Daily Decision Service Alert: Vol. 22, No. 17 – January 25, 2013

New Jersey Law Journal

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STATE COURT CASES
 
ADMINISTRATIVE LAW
01-2-8816 In re New Jersey Highlands Water Protection And Planning Council Approval Of The Petition For Plan Conformance For The Town Of Clinton, Hunterdon County, App. Div. (per curiam) (30 pp.) The Fair Share Housing Center filed two separate appeals, each challenging a resolution of the Highlands Water Protection and Planning Council conditionally approving a municipality's master plan and land use regulations as conforming with the Council's regional master plan for the Highlands. The Center asserts the Council was required, but failed, to adopt "the substantive and procedural requirements that form the plan conformance process" in accordance with the rule-making procedures of the Administrative Procedure Act (APA). The Center urges the court to invalidate the resolutions, and compel the Council to comply with the APA. The issues concern the Council's implementation and administration of the Highlands Water Protection and Planning Act and consolidation is appropriate. The appellate panel finds the Center has not overcome the presumption of validity afforded agency action, that is, the Center has failed to overcome the validity of the Council's choice to provide instructions on plan conformance informally. The providing of instruction on the essential requirements of plan conformance can be viewed as actions related to the Council's obligations to investigate, publicize, plan, and supervise to achieve the complex goals of the Highlands Act.
 
ADMINISTRATIVE LAW — CIVIL SERVICE COMMISSION
01-2-8817 I/M/O Gliottone, App. Div. (per curiam) (22 pp.) Appellant appeals from a final decision of the Civil Service Commission upholding his removal as a Mercer County Corrections Officer and denying his motion to enforce a purported settlement agreement. Finding that the attorney for the county had neither actual nor apparent authority to settle the matter before a settlement agreement was drafted and reviewed by the county authorities, and that appellant's claim that he relied to his detriment on the attorney's representation in her emails and that his reliance was reasonable is without merit, and that even if the attorney had authority to negotiate a settlement, her proposal lacked essential terms which rendered it non-binding and unenforceable, the panel holds that the commission's conclusion that there was no enforceable agreement was supported by credible evidence and should not be disturbed. The panel also finds that the commission's decision to remove appellant was supported by sufficient credible evidence and was not arbitrary or capricious.
 
BUSINESS ENTITIES
12-2-8818 Mizrack v. Fairmount Chemical Co. Inc., App. Div. (per curiam) (44 pp.) This appeal arises from a derivative action by plaintiffs, two shareholders and Fairmount's bankruptcy trustee, against William Kaltnecker, one of Fairmount's officers, and other defendants for damages, an order directing them to comply with document requests, for breach of fiduciary duty and misappropriate of corporate opportunities. The trial court found that defendants Branson and Halle had breached their fiduciary duties and awarded damages. The allegations against Kaltnecker, DaMota and the DaMota Family Partnership were dismissed, and counsel fees were denied as to all parties except for $100,000 in favor of Kaltnecker against Fairmount only. Kaltnecker appeals the limitation on his fee award. Plaintiffs cross-appeal, arguing that the judge erred by failing to find Kaltnecker and DaMota liable, awarding Halle a setoff for damages and failing to find him also liable for additional sales of Fairmount's products, limiting damages against Branson, and dismissing their expert's opinion on valuation. The panel affirms, substantially for the reasons set forth below, including that there was ample evidence to support the finding that Kaltnecker was blameless for Fairmount's demise and how it would up its affairs; Kaltnecker was entitled to counsel fees pursuant to N.J.S.A. 14A:3-5(2)(a); and that the decision to grant Halle a setoff for unpaid wages and unreimbursed wages was firmly grounded in the record.
 
CIVIL PROCEDURE
07-2-8819 Fitzgerald v. Gann Law Books, Inc., App. Div. (per curiam) (10 pp.) Plaintiff filed this class action suit in the Law Division against defendants Gann Law Books, Inc., Gann Legal Education Foundation, Inc., and Michael Protzel, alleging that defendants violated the federal Telephone Consumer Protection Act (TCPA). Shortly thereafter, the Appellate Division decided Local Baking Products, Inc. v. Kosher Bagel Munch, Inc., which held that class action suits were inappropriate for adjudicating TCPA claims in the courts of this state. The next day, defendants moved to dismiss plaintiff's class action claims with prejudice and to transfer the remaining claims to the Small Claims Section of the Special Civil Part. The following day, plaintiff filed a notice of voluntary dismissal without prejudice under Rule 4:37-1(a), and defendants filed an answer. Five days later, plaintiff filed a similar complaint in District Court. The Law Division ruled that plaintiff's notice of voluntary dismissal was untimely under Rule 4:37-1(a) but construed Rule 4:37-1(b) as giving it discretionary authority to dismiss plaintiff's complaint. Defendants appeal, arguing that the trial court erred in exercising the authority conferred in Rule 4:37-1(b) because the court failed to consider plaintiff's alleged improper motive of forum shopping. The appellate panel affirms for reasons other than those expressed by the trial court, finding plaintiff's notice of voluntary dismissal under Rule 4:37-1(a) was timely filed.
 
CONTRACTS ALTERNATIVE DISPUTE RESOLUTION
11-2-8820 Tri-Tech Environmental Engineering Inc. v. Nutley Bd. of Educa., App. Div. (per curiam) (25 pp.) This dispute arises out of an agreement under which plaintiff provided construction management services for the remodeling and renovation of the board's seven school facilities, defendant's termination of plaintiff's services, and defendant's repudiation of a settlement between the parties. Plaintiff appeals the trial court's order referring some of the counts in plaintiff's second amended complaint to arbitration, arguing that the court should have referred all 14 counts to arbitration pursuant to the parties' original agreement that contained a mandatory arbitration clause and that the entire controversy doctrine does not allow a portion of its claims to be litigated and the other portion to be arbitrated. The panel affirms, finding that the court properly retained jurisdiction over counts in the second amended complaint that grew out of the settlement and a rider, which specifically preserved for litigation in court plaintiff's claims for non-payment and any other claims that arose relating to the settlement and rider. Given the explicit terms of those instruments, the trial court correctly declined to refer such specified claims to arbitration without the mutual consent of the parties. Also, the court properly maintained jurisdiction over those claims against co-defendants who were not parties to an arbitration agreement. Given the distinctive, bargained for arrangements, the jurisdictional division of plaintiff's claims into two tribunals, although inefficient, does not violate the entire controversy doctrine.
 
FAMILY LAW
20-2-8821 Burgos v. Burgos, App. Div. (per curiam) (6 pp.) Plaintiff appeals from the grant of defendant's motion to reduce alimony and child support without discovery or a hearing. Because the trial judge did not explain his reasons for concluding that defendant had produced sufficient evidence of a material changed circumstance, and, assuming such showing was made, erred in not affording plaintiff compulsory discovery, the panel reverses and remands for reconsideration.
 
FAMILY LAW
20-2-8822 Mayer v. Mayer, App. Div. (per curiam) (15 pp.) In this post-judgment matter, defendant appeals from two orders. She contends that the judge erred in awarding her ex-husband, plaintiff, judgment in the amount of 35,558.88, reflecting overpayments made for child support, without a plenary hearing. She also asserts the judge erred in denying her request for modification of the parenting time schedule, and in denying her request for counsel fees. Plaintiff cross-appeals, contending the judge erred in setting the amount of weekly credit to reduce the overpayment to be deducted from his child support payments going forward, and in denying his request for counsel fees. The support payments were made via a wage garnishment administered by the Monmouth County Probation Division which applied the pendent lite support amount in error. Defense counsel raised laches and equitable estoppel as defenses to plaintiff’s request for reimbursement. The judge apparently decided that, since there was no dispute that plaintiff overpaid his child support for more than seven years, reimbursement was required. The judge did not address plaintiff’s equitable claims. The appellate panel reverses and remands for a plenary hearing on the child support issue. The panel affirms the denial of defendant’s request for modification of the parenting time schedule. Counsel fees will be addressed on remand.
 
WORKERS’ COMPENSATION AND OTHER COMPENSATION SYSTEMS
39-2-8823 Osorto v. Frank Feimer T/A FMF Construction, App. Div. (per curiam) (7 pp.) In this workers' compensation coverage case, petitioner Santos Osorto was employed by FMF Construction, a subcontractor on a project for which Integrity Material Handling Systems was the general contractor. After he was injured on the job, Osorto filed two separate claim petitions naming FMF as the respondent and listing Travelers Indemnity Company as the insurance carrier for the employer. Travelers answered each petition "on behalf of the carrier only," asserting that the employer's policy was cancelled prior to the accident. Travelers filed a "Motion to Dismiss Carrier," on notice to petitioner and FMF, claiming lack of coverage. Osorto then filed a separate claim petition against Integrity. He also filed a motion to join the Uninsured Employers' Fund as a respondent in his petition against FMF. The appellate panel finds that, having settled Osorto's petition without a reservation of rights, Travelers is barred from denying coverage to its insured and cannot pursue an appeal aimed at canceling that coverage. Also, Integrity was not a party to the claim petition that Travelers settled and Travelers was not a party to Osorto's claim petition against Integrity. Travelers therefore cannot appeal from the order dismissing Osorto's petition against Integrity. This appeal is dismissed.
 
CRIMINAL LAW
14-2-8824 State v. Abdelrehim, App. Div. (per curiam) (17 pp.) Defendant, an Egyptian native, entered a guilty plea for one drug offense and multiple theft-related offenses while he was a lawful resident of the United States and was sentenced to probation. He subsequently violated probation and was sentenced to three years of custody. His first PCR petition alleging ineffective assistance of counsel and deprivation of his rights under the Geneva Convention was denied and defendant was deported. His appeal was dismissed as moot in light of the deportation. His second PCR petition, filed five years later, was dismissed on the papers. Concluding that the time bar of Rule 3:22-12 should be relaxed in this case, the panel remands to the trial court for an evidentiary hearing on whether his plea counsel affirmatively misled him about whether his guilty plea could subject him to deportation consequences.
 
CRIMINAL LAW
14-2-8825 State v. Dixon, App. Div. (per curiam) (38 pp.) After a bench trial, defendant was found guilty of second-degree robbery, second-degree burglary, third-degree aggravated assault, false imprisonment, fourth-degree resisting arrest by flight, and fourth-degree unlawful possession of a weapon. The court sentenced defendant to an aggregate term of twenty-five years of incarceration. The appellate panel affirms the denial of defendant’s suppression motion and his conviction. However, the panel finds the five-year consecutive sentence imposed for the aggravated assault is invalid because the assault conviction must merge into the robbery offense. The other consecutive sentence was imposed on what the judge erroneously treated at sentencing as a "criminal restraint" offense but what, in actuality, was false imprisonment. The false imprisonment conviction is sufficiently distinct from the burglary and robbery convictions. The sentence for false imprisonment may lawfully run consecutively to the sentences imposed for robbery and burglary. The convictions are affirmed as modified. The matter is remanded for resentencing.
 
FEDERAL COURT CASES
 
BANKRUPTCY
42-6-8826 In Re: Clemente, Bankruptcy Ct. (Kaplan, U.S.B.J.) (9 pp.) Before the Court is a motion for reconsideration filed on behalf of the United States of America, seeking to vacate the order granting the Chapter 7 Trustee’s motion to expunge, reduce, and modify the United States’ two proofs of claims. The Trustee does not oppose the United States’ motion and consented to the amended priority claim filed by the Internal Revenue Service (“IRS”). The Debtor opposes the United States’ motion and disputes the amount and the dischargeability of the IRS’s claim. The court finds that the Debtor willfully refused to pay his tax liability and is liable for penalties and interest. The court finds that there was no basis to expunge or reduce the IRS’s claims. The court rules in favor of the IRS and reconsiders its order reducing and expunging the IRS’s claims. Since the filing of the motion to reconsider, the Trustee and the United States have submitted a Consent Order with respect to the amount and classification of the IRS’s claim. Consistent with that order, the court fixes the IRS’s priority claim in the amount of $299,590.53 and the IRS’s general unsecured claim in the amount of $654.75. To the extent these claims are priority claims, they are non-dischargeable. The IRS’s motion for reconsideration is granted and the court’s order expunging and reducing the IRS’s claim is vacated. [Filed January 17, 2013]
 
CIVIL RIGHTS
46-7-8827 United States of America v. Franco-Felix, Dist. Ct. (Pisano, U.S.D.J.) (12 pp.) Defendant was indicted for possession with intent to distribute 500 grams or more of cocaine. Defendant moved to suppress evidence that was recovered from a search of his vehicle and apartment and to suppress any post-arrest statements that were made. The Court finds that Defendant voluntarily consented to the search of his vehicle. The evidence obtained from such search will not be suppressed. However, the Court concludes that officers entered Defendant’s apartment without voluntary consent. The search of the apartment violated Defendant’s Fourth Amendment right to be free from unreasonable searches and seizures. Defendant’s motion to suppress evidence seized at the apartment is granted. Defendant’s motion to suppress statements obtained in connection with the search is denied as moot. [Filed January 16, 2013]
 
CIVIL RIGHTS CORRECTIONS
46-7-8828 Malouf v. Dr. Nicoletta Turner-Foster, Dist. Ct. (Simandle, U.S.D.J.) (26 pp.) Plaintiff, a federal inmate, asserts an Eighth Amendment denial of medical care claim, a medical negligence claim, and a claim of retaliation. The Court takes judicial notice of Plaintiff’s earlier civil rights action, which raised similar prior claims. The court in the earlier action dismissed Plaintiff’s medical negligence claim for lack of jurisdiction because Plaintiff failed to present the claim to the BOP, as required under the Federal Tort Claims Act (FTCA). The court granted Defendants’ motion for summary judgment regarding the Eighth Amendment denial of medical care claim and retaliation claim for failure to exhaust administrative remedies. Here, Plaintiff’s Eighth Amendment claim alleging denial of medical care and Plaintiff’s First Amendment retaliation claim will be dismissed without prejudice for failure to state a claim. Plaintiff’s FTCA claim of medical malpractice may proceed as against the United States only, and limited to those allegations pertaining to claims of medical negligence purportedly occurring while Plaintiff was confined at FCI Fort Dix. [Filed January 17, 2013]
 
CONSTITUTIONAL LAW — HABEAS CORPUS
14-7-8829 Smith v. Warden of Essex County Jail, Dist. Ct. (Debevoise, S.U.S.D.J.) (11 pp.) Plaintiff, a citizen of Jamaica who pled guilty in state court to possession of CDS and robbery, was subsequently deported. He was rearrested for unlawful reentry and has been remanded to the custody of the United States Marshall's Service and is housed at the Essex County Jail awaiting trial on violating the INA. The state court, relying on State v. Gaitan's holding that Padilla is not retroactive, denied his PCR motion. He filed a petition for a writ of habeas corpus, alleging that he was unlawfully imprisoned in violation of the Constitution of the United States. The court dismissed the petition, finding that no state official has custody over petitioner and thus could not be subject to a habeas corpus petition. On reconsideration, the court finds that petitioner was arrested by Immigration and Customs Enforcement Officers for unlawful entry into the United States following his deportation. He is in custody facing criminal prosecution for violation of the INA. He was remanded to the USMS by the order of a United States Magistrate Judge. These are all lawful proceedings. Even if the state court were to grant his PCR and allow him to withdraw his plea taken in violation of his Padilla rights, application for federal relief more properly is made to the judge who is handling his criminal case and presently has jurisdiction over him. Therefore, his petition against the United States Marshal was appropriately dismissed. [Filed January 24, 2013]
 
EVIDENCE
19-7-8830 Glielmi v. The Raymond Corporation, Dist. Ct. (Schneider, U.S.M.J.) (19 pp.) This order addresses whether certain of defendants’ proposed trial exhibits should be barred because they were produced late. This lawsuit arises out of plaintiff’s forklift accident on February 6, 2008 while he was in the course and scope of his employment with Superior Pool Products. Superior purchased a forklift from Raymond Corporation. Raymond forwarded the sales order to its dealer, Arbor Materials Handling, Inc. Because the purchased forklift was not ready, Arbor delivered a rental stand-up forklift to Superior. While Arbor was showing Superior’s employees how to use the Forklift, plaintiff was injured. The Court finds that plaintiffs were required to produce the exhibits at issue in response to defendants’ discovery served in 2010. In any event, the exhibits should have been produced soon after January 27, 2011 when Plaintiffs’ expert’s report put defendants on notice that they would argue that plaintiff should have been trained on the loading dock. Defendants’ late production is not substantially justified. Plaintiffs will be substantially prejudiced if the exhibits are used at trial. The Court grants plaintiffs’ motion to preclude defendants from submitting the evidence at trial. [Filed January 17, 2013]
 
INTELLECTUAL PROPERTY PATENTS
53-7-8831 MacDermid Printing Solutions, L.L.C. v. E.I. Du Pont De Nemours and Company, Dist. Ct. (Cooper, U.S.D.J.) (2 pp.) Plaintiff MacDermid Printing Solutions, L.L.C. brings this patent infringement action against defendant E.I. du Pont de Nemours and Company. MacDermid alleges, inter alia, that DuPont infringes United States Patent Number RE39,835 (“the ’835 Patent”) by “making, using, offering to sell, selling and/or importing” a product known as “Cyrel DFM 67”. Dupont moves for summary judgment as to MacDermid’s allegations relating to Cyrel DFM 67. DuPont supports the motion with a brief and statement of undisputed facts. MacDermid has filed a brief in response to the motion. It has not filed a response to DuPont’s statement of undisputed facts, nor has it offered a counterstatement of facts. MacDermid’s brief concedes that Cyrel DFM 67 does not infringe the ’835 Patent. The Court grants Dupont’s motion for summary judgment insofar as this action concerns Cyrel DFM 67. [Filed January 15, 2013]
 
LABOR AND EMPLOYMENT
25-7-8832 Greaves v. Gap Inc., Dist. Ct. (Wigenton, U.S.D.J.) (9 pp.) In this action arising out of plaintiff's termination and alleging violation of the Conscientious Employee Protection Act and the Fair Labor Standards Act, the court converts defendant's motion to dismiss into a motion for summary judgment and grants the motion, finding that plaintiff's CEPA claims fail because they are time-barred as they were not filed within one year of his termination and because plaintiff fails to allege concerns that relate to the public; and that plaintiff's FLSA claims fail because they are time barred and because plaintiff has not offered support for his overtime claims or disputed the records defendant provided showing that he did not work any uncompensated overtime hours. [Filed January 23, 2013]
 

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