Category: Business Law

Philadelphia Contract Lawyers: Arbitration Clauses in Nursing Home Contracts

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Over the past decade, arbitration clauses have become increasingly common. Look closely at your cellphone service contract, credit card contract or student loan agreement, and you are likely to discover that you have given up your right to seek redress in court in the event of a dispute. Nursing homes have also embraced these clauses. The ethics of mandatory arbitration for nursing home patients is even more questionable than in other contexts, because elderly patients may not be able to understand that they are surrendering this important right.

Recently in Massachusetts, an elderly nursing home patient was murdered by her 97-year-old roommate after a disagreement over moving a nightstand so that the decedent could make her way to the bathroom. The decedent’s son sought to hold the nursing home accountable, only to discover the nursing home contract forced any dispute into private arbitration.

The patient’s son has questioned whether the arbitration process could really be objective. The arbitration firm, who ultimately resolved this dispute, had previously handled over 400 arbitrations for the law firm representing the nursing home. Because the arbitration firm draws such a substantial amount of business from the nursing home, it would appear they might have a reason to resolve cases in their favor. In this case, the firm ruled in the nursing home’s favor, without providing any basis for their ruling. The arbitrator’s “opinion” consisted of a single check mark indicating that the nursing home had not been negligent in its care of the late patient.

Despite these issues, judges have consistently upheld mandatory arbitration clauses, even where the individuals who signed the contracts did not understand what rights they were forfeiting. However, lawmakers are becoming increasingly concerned because the private nature of arbitration proceedings can shield the public from patterns of wrongdoing in nursing homes. Recently, lawmakers in 16 states have urged the federal government to deny Medicaid and Medicare funding to nursing homes that use mandatory arbitration clauses.

In this case, the patient’s son challenged the validity of the arbitration clause in his mother’s nursing home contract on grounds that he signed the admissions papers on her behalf, but did not have the authority to bind her to arbitration. A judge found in his favor. Appeals courts across the country are following suit and throwing out nursing home contracts signed by family members of residents.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green Represent Businesses and Individuals in Contract Disputes

If you have a contract dispute, or are being sued for breach of contract, the experienced Philadelphia contract lawyers at Sidkoff, Pincus & Green can help. With offices conveniently located in Philadelphia, we represent clients throughout Pennsylvania and South Jersey. Call us at 215-574-0600 or contact us online today.

Philadelphia Business Lawyers: Settlement in Mislabeled Product Lawsuit

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Qualitest Pharmaceuticals Inc., facing a class-action lawsuit brought by the federal government and 48 states claiming unlawful labeling, has settled the case for five million dollars.

Qualitest, a manufacturer of generic vitamins and a subsidiary of Endo Health Solutions, allegedly misrepresented the amount of fluoride in its multivitamin tablets. Although Qualitest labeled and advertised its product as containing the daily amount of fluoride recommended by the American Dental Association, the vitamins actually contained only half the recommended amount. Under the settlement agreement, Qualitest will pay $2.2 million to the federal government and $2.8 million to the state of New York to resolve claims pertaining to New York’s Medicaid program.

Philadelphia business lawyers at the Law Offices of Sidkoff, Pincus & Green have successfully represented clients in whistleblower lawsuits, class actions and business tort litigation for more than 50 years. Contact us online or call our Philadelphia law firm at 215-574-0600.

Business Lawyers Philadelphia: Insurance Bad Faith Claims

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Insurance Bad Faith Claims May Survive Even Where No Coverage is Due

In Citi Gas Convenience v. Utica Mutual Insurance Co., the Eastern District of Pennsylvania ruled that a party can bring a bad faith claim even where a court may find no coverage is due if “bad faith is asserted as to conduct beyond a denial of coverage, the bad faith claim is actionable as to the conduct regardless of whether the contract claim survives.”

For example, an insurer may conduct bad faith in its investigation practices, even if ultimately the Court rules that a party is not entitled to coverage. However, the Plaintiff in Citi Gas Conveniencefailed to adequately plead such a claim, and it was dismissed without prejudice.

For more information, call Philadelphia business lawyers at Sidkoff, Pincus & Green at 215-574-0600 or contact us online.

Philadelphia Business Lawyers: Conflict of Interest / Self-Dealing Transactions

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Courts will closely scrutinize conflict of interest and self-dealing transactions (i.e., having an individual and/or corporation on both sides of the same transaction). Traditionally, these types of transactions are subjected to the “entire fairness review”. In order to survive this standard review, the price and the dealing must be fair. Globe Woolen Co. v. Utica Gas & Elec. Co., 224 N.Y. 483 (fundamental business organization case holding that there is a breach of fiduciary duty of loyalty despite a director, who served on two boards of two companies, did not vote on a transaction because neither fair price nor fair dealing was present). Fair price is typically the equivalency of value between what the corporation gave up and what the corporation received. Fair dealing has several factors (none dispositive) of candor and disclosure:

1)      Not only abstaining vote, but excusing yourself to not exert pressure on the deal;

2)      Imbalance between the corporations at negotiation;

3)      Involvement of disinterested advisors; and

4)      Candor – director should not stand in silence when he or she is aware that the agreement is detrimental to one side.

For more information, call Philadelphia business lawyers at Sidkoff, Pincus & Green at 215-574-0600 or contact us online.

Philadelphia Business Lawyers: Public Accommodation Requirements

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Title III of the ADA

Title III of the Americans with Disabilities Act regulates the accessibility requirements that businesses must follow to be in compliance with Title III. They address both outside of businesses such as sidewalks or ramps, as well as indoor business structure such as bathroom accessibility and corners. All new construction or alterations must adhere to this title. Entities also have an on-going obligation to remove non-complaint architectural barriers in existing facilities is it is readily available. This determination is dependent on the size and the resources of the business. This applies to, but is not limited to, commercial facilities such as factories, office buildings or warehouses, private entities that offer examinations or related to educational purposes, and most notably public entities.

Any individual with a disability who is denied access to a place of public accommodation due to a non-compliant architectural barrier may sue under Title III for an injunction requiring the business to become ADA-compliant and reasonable attorney’s fees, costs, and expenses. According to a recent study, nearly twice as many Title III suits were filed in Pennsylvania’s federal courts between July 1, 2012 and January 1, 2015 than during the preceding thirty-month period. These suits—most of which were filed by a few individuals represented by a small number of plaintiff’s attorneys—frequently settle before trial, resulting in businesses paying the plaintiff’s attorney’s fees as well as the cost of remediating non-compliant facilities.

For more information, call Philadelphia business lawyers at Sidkoff, Pincus & Green at 215-574-0600 or contact us online.

Business Lawyer in Philadelphia: Ex-Employee Alleges Wrongful Conduct in Counterclaim

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Lawing Financial has accused a former employee of conspiring with a co-worker to steal trade secrets, then opening up a competing business. According to Lawing Financial’s lawsuit, the defendant initially helped the company establish its business. Then, he and his co-worker allegedly conspired to steal trade secrets, including client lists, from the firm before resigning without notice to immediately open a competing business. He had been employed by the company for seven years before resigning.

The defendant has denied all accusations of wrongdoing and filed a counterclaim, alleging that he left the company because, among other things, he was not paid compensation he was entitled to. He is also suing Lawing Financial for defamation of character, libel, slander and tortious interference of contracts.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green Pursue Compensation for Those Victimized by Wrongful Acts and Business Torts

If you are in need of a business lawyer in Philadelphia, the team at Sidkoff, Pincus & Green has extensive experience in business tort litigation, including copyright or trademark infringement, fraud, breach of fiduciary duty, unfair competition and misappropriation of confidential information. To schedule a consultation, call us at 215-574-0600 or fill out our online contact form today. With offices conveniently located in Philadelphia, we represent businesses throughout Pennsylvania and South Jersey.

Philadelphia Business Lawyers: Insurance Claims

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Pennsylvania Federal Court Rules Insurance Claims Files are Discoverable and Not Subject to the Work-Product Doctrine

In Smith v Progressive Specialty Insurance Company, the Western District of Pennsylvania ruled that an insurer’s claims file can be discoverable in a bad faith case, as information in that file on the insurer’s decision to deny the claim is “relevant or could lead to potentially relevant information.” The Court ordered Progressive to produce all relevant documents from its claim file prepared before it could be reasonably anticipated that the claim would be litigated, finding that the work-product doctrine did not apply.

The Court acknowledged that not everything “prepared by or for the agents of an insurer” is protected by the work product doctrine, and that the doctrine only protects documents prepared in anticipation of litigation. Here, the insurer argued that litigation was anticipated as soon as the insured asserted an underinsured motorist claim. The
Court disagreed, and found that the insurer could not have reasonably anticipated litigation until the insurer’s position and the insured’s position as to the extent of the insured’s damages and lost wages came to “loggerheads.” Accordingly, documents prepared before that time fell outside the scope of the work product

For more information, call Philadelphia business lawyers at Sidkoff, Pincus & Green at 215-574-0600 or contact us online.

Philadelphia Wrongful Termination Lawyers: Doctor’s Case May Proceed

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On February 24, 2016 the Eastern District of Pennsylvania ruled to allow Plaintiff, Dr. Muhamad Aly Rifai, to move forward on his claims for breach of contract and wrongful termination under the Americans with Disabilities Act. In Rifai v. CMS Medical Care Corporation, et al., Plaintiff alleges that Defendant CMS hired him in May 2011 for a three-year term of employment, which was subsequently renewed a year later. The employment contract provided that either Plaintiff or CMS could terminate the agreement by giving the other party at least 120 days’ notice of the intent to terminate, or CMS could terminate immediately for cause.

Plaintiff alleges that on January 2, 2013, Plaintiff was given 120 days’ notice that he would be terminated on May 7, 2013. However, Plaintiff alleged that only five days later he was terminated for cause, effective May 7, 2013. Plaintiff thereafter filed suit, claiming Defendants fired him due to his Syrian ethnic background, Islamic religious beliefs, and the perception that he was mentally disabled. The Eastern District ruled that Plaintiff plead sufficient facts to allege breach of contract and a claim under the ADA.

The Court ruled that it found “that plaintiff sets forth sufficient facts to demonstrate that defendants regarded him as having an impairment,” specifically noting how Rifai’s complaint explained that at the time of his termination, defendants told various employees Rifai suffered from a mental impairment and was mentally unstable, unable to safely perform his medical duties.

For more information, call Philadelphia wrongful termination lawyers at Sidkoff, Pincus & Green at 215-574-0600 or contact us online.

Philadelphia Business Lawyers: Statue of Limitations for Bad Faith Claim

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Statute of Limitations for Bad Faith Claim Triggers After Failure to Investigate Same Claim After Denial, When Insurer is Provided With New Information

In Rancosky v. Washington National Insurance Company, the Superior Court addressed the issue of whether the statute of limitations for bad faith claims restarts after an insurance company fails to investigate a claim after receiving new information. In Rancosky, the Court ruled that the insured’s bad faith claim fell within the two-year statute of limitations based upon poor investigative practices. .

The trial court effectively ruled that a bad faith plaintiff must establish the insurer had a motive of self-interest or ill will. While the trial court had ruled that self-interest or ill will were considered in weighing the first element, absence of a reasonable basis, the Superior Court found this was merely a back door ruling that self-interest or ill will were required elements to establish the claim. The Superior Court observed that “there is an important distinction between an initial act of alleged bad faith conduct and later independent and separate acts of such conduct.”  It ruled that: “When a plaintiff alleges a subsequent and separately actionable instance of bad faith, distinct from and unrelated to the initial denial of coverage, a new limitations period begins to run from the later act of bad faith.” Thus, “[a]n inadequate investigation is a separate and independent injury to the insured.”

For more information, call Philadelphia business lawyers at Sidkoff, Pincus & Green at 215-574-0600 or contact us online.

Philadelphia Business Lawyers: Class Action Lawsuit for Unsolicited Text Messages

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Advertising firm, Campbell-Ewald, sent unsolicited text messages on behalf of the U.S. Navy to approximately 100,000 people, stating: “Destined for something big? Do it in the Navy.” These messages were sent as part of an ongoing recruitment drive. The U.S. Supreme Court has recently ruled against Campbell-Ewald, despite arguments that the advertising firm’s settlement offer to class action members would have resolved the case.

The class action plaintiffs claim that the company violated the federal Telephone Consumer Protection Act by sending the unsolicited text messages. The company argued that because it had offered to pay plaintiffs the maximum amount available under law to settle the claims, that the Court had no grounds to hear the case. Campbell-Ewald had offered to settle for $1,500 for each violation of the Act.

The Supreme Court upheld the September 2014 decision of the San Francisco-based 9th Circuit Court of Appeals. The Court’s six-three decision was issued in favor of the plaintiffs, led by class action lead plaintiff Jose Gomez. Writing on behalf of the majority, Justice Ruth Bader Ginsburg indicated that an unaccepted settlement offer does not moot a plaintiff’s case. The Court’s opinion is docketed Campbell-Ewald v. Gomez, U.S. Supreme Court, No. 14-857.

In the current Supreme Court term, there are three class action appeals on the docket. The other cases involve appeals filed by Tyson Foods, Inc. and Spokeo, Inc. Campbell-Ewald is a large Detroit-based advertising agency that is a subsidiary of the Interpublic Group of Companies, Inc.

The U.S. Navy was not named as a defendant in this case and is not being sued with respect to this incident. The Obama administration has filed an amicus brief in favor of Gomez and the other class action plaintiffs.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green Represent Individuals in Class Action Lawsuits

In a class action lawsuit, large numbers of individuals who have suffered a similar harm can harness the power of their numbers to effectively seek justice against a large corporation. When an individual suffers a nominal harm, such as receiving an unsolicited text message, there is no incentive to file a lawsuit due to the high cost-benefit ratio. But when plaintiffs unite, class actions are an effective means to hold corporations responsible for their harmful conduct.

Philadelphia business lawyers at Sidkoff, Pincus & Green represent clients in class actions throughout Philadelphia and South Jersey. Our offices are conveniently located in Center City Philadelphia. To schedule a consultation, call us at 215-574-0600 or contact us online.