Daily Decision Service Alert: Vol. 22, No. 127 – July 2, 2013

New Jersey Law Journal

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STATE COURT CASES

ADMINISTRATIVE LAW — UNEMPLOYMENT COMPENSATION BENEFITS
01-2-0497 Jones v. Board of Review, App. Div. (per curiam) (7 pp.) Appellant appeals from a final decision of the Board of Review that found her unemployment claims invalid under N.J.S.A. 43:21-19(i)(7)(C) and determined she was liable for a refund of benefits received. The panel affirms, holding that the board properly found that appellant's employment could not be used to establish a valid unemployment claim because she worked for a single-member limited liability company owned by her husband and thus she worked for her husband and that employment is excluded under N.J.S.A. 43:21-19(i)(7)(C) , and she is required to repay the unemployment benefits received pursuant to N.J.S.A. 43:21-16(d).   

BUSINESS ENTITIES
12-1-0498 Sipko v. Koger Inc., Sup. Ct. (Patterson, J.) (29 pp.) George Sipko’s gift of Koger stock to Robert Sipko was unconditional and therefore irrevocable. Robert’s transfers of KDS and KPS stock are void for lack of consideration.  

CIVIL RIGHTS
46-2-0499 Brown v. Middlesex Management, App. Div. (per curiam) (5 pp.) Plaintiff appeals from a decision of the director of the Division on Civil Rights finding no probable cause to her allegations that she was denied an apartment at the complex managed by defendant because of her race and her participation in the Section 8 housing subsidy program. The panel affirms, finding that the director's determination that the refusal was based on negative information in a credit report, including several prior eviction proceedings and two accounts in collection, was properly based on facts in the record and is consonant with relevant statutory provisions. 

CONTRACTS
11-2-0500 KS Engineering P.C. v. Tony Gomes Construction Co. Inc., App. Div. (per curiam) (5 pp.) Plaintiff contracted with defendant to provide engineering services in connection with a construction project awarded to defendant. The contract provided for payment of $23,000 on completion of each of three specified milestones. The parties dispute the amount to which plaintiff is entitled for work done before defendant notified it to stop work. Defendant appeals from the judge's conclusion that plaintiff was entitled to $23,000 based on the conclusions that plaintiff had completed the first milestone in the contract and that Gomes' testimony to the contrary was not credible. Finding that there is substantial credible evidence to support the judge's factual findings, the panel affirms. 

FAMILY LAW
20-2-0501 Black v. Black, App. Div. (per curiam) (5 pp.) Defendant appeals from the orders denying his motion to terminate alimony and child support and for reconsideration. The panel reverses, finding that defendant, a contractor who suffers from certain ailments that have prevented him from performing physical labor and who has begun collecting Supplemental Security Income although he has not been determined to be permanently disabled, has made a prima facie showing of changed circumstances. The matter is remanded for disclosure of the parties' financial status and a determination of whether there are changed circumstances sufficient to adjust defendant's obligations for child support and alimony.

HEALTH LAW
22-2-0502 St. Peter’s University Hospital v. New Jersey Building Laborers Statewide Welfare Fund, etc., App. Div. (Axelrad, P.J.A.D.) (25 pp.) In these consolidated appeals, we decide whether the Employee Retirement Income Security Act (ERISA), 29 U.S.C.A. § 1001 to -1461, pre-empts a medical provider’s claims against the ERISA benefit plan for payment of the provider’s customary fees for the services it rendered to patients rather than the discounted fees the plan would have been legally entitled to pay had it not breached its contractual obligation for timely payment. We are satisfied the provider’s claims are expressly pre-empted by § 514(a) of ERISA, 29 U.S.C.A. § 1144(a), and thus affirm summary judgment dismissal of the complaints. [Approved for publication.] 

LABOR AND EMPLOYMENT
25-2-0503 Searles v. Board of Review, App. Div. (per curiam) (5 pp.) Searles appeals from a final decision of the Board of Review dismissing her appeal from the denial of unemployment compensation benefits as untimely because it was filed more than three years after the expiration of the statutory 10-day period and good cause was not shown for such late filing. In her letter of appeal, Searles alleges she was in a car accident on May 3, 2007, and for this reason she was unable to appeal the Appeal Tribunal's July 18, 2007 decision. However, this accident did not prevent Searles from appealing the Appeal Tribunal's May 15, 2007, decision. Also, Searles failed to provide any medical documentation regarding her injuries. The appellate panel affirms the board's final decision. 

LABOR AND EMPLOYMENT
25-2-0504 Toll v. Sills Cummis & Gross, App. Div. (per curiam) (20 pp.) Plaintiff James Toll, a 52-year-old attorney, had been employed by defendant Sills Cummis & Gross for 22 years when his employment was terminated. Plaintiff appeals from orders of the Law Division granting summary judgment to defendant on plaintiff's age discrimination claim and defendant's counterclaim for conversion of a referral fee; and granting a directed verdict to defendant on his claim of retaliation. The appellate panel affirms. As to the age discrimination claim, plaintiff has not met his burden of demonstrating that defendants' proffered legitimate, nondiscriminatory reasons for his termination were pretextual. As to the claim of retaliatory discharge, plaintiff failed to establish that his termination, which occurred in September 2007, was in retaliation for the December 2006 letter from plaintiff's counsel claiming age discrimination. As to the conversion claim, plaintiff was the agent of defendant acting within the scope of his employment and the fee belongs to defendant. 

LAND USE AND PLANNING
26-2-0505 The Salt & Light Company Inc. v. Township of Willingboro Zoning Board of Adjustment, App. Div. (per curiam) (6 pp.) In a neighborhood that was zoned for single-family homes, plaintiff, The Salt & Light Company, sought to convert a residence to a three-family unit to provide transitional housing for the homeless. Defendant Willingboro Zoning Board of Adjustment denied the use variance. The court reversed the denial of the use variance and remanded for a determination as to plaintiff’s application for a parking variance and site-plan waiver, which defendant denied. Plaintiff appeals from the order subsequently granting defendant s motion for reconsideration of the denial of the use variance, reversing the grant of the use variance, and denying plaintiff's motion for summary judgment. The appellate panel affirms. The Municipal Land Use Law provides that a variance, even for an inherently beneficial use, must not be granted if it will substantially impair the intent and the purpose of the zoning plan. Here, conversion of a single-family property to a three-family residence would substantially impair the zoning plan, which was intended for single-family homes.  

RESIDENTIAL AND COMMERCIAL REAL ESTATE
34-2-0506 Fields Development Group Co. v. 79-01 Associates, App. Div. (per curiam) (14 pp.) Plaintiff Fields Development Group Co. entered into a contract to purchase defendant 79-01 Associates’ property located in Jersey City. Defendant did not fulfill its Industrial Site Recovery Act obligation and therefore was never able to proceed to closing. Plaintiff filed a complaint against defendant and its attorney, alleging breach of contract and exercise of unlawful dominion over the contract deposit. Defendant filed an answer and counterclaims, seeking dismissal of plaintiff's complaint and alleging a breach of contract entitling defendant to keep the deposit. Both parties moved for summary judgment. The appellate panel affirms the order of the Law Division granting summary judgment in favor of plaintiff, and ordering its attorney to remit the deposit being held in trust by him to plaintiff. 

TORTS
36-2-0507 Awad v. Forest Realty Management, App. Div. (per curiam) (7 pp.) Plaintiff appeals from the Law Division's grant of defendants' motion for summary judgment in this action filed after plaintiff, a tenant in an apartment complex owned and managed by defendants, voluntarily left her apartment after observing a fire in a neighboring unit that was caused by lint buildup and tripped and fell over a fire hose when she went to speak with firefighters regarding the neighbor's cat, which was still in the apartment. The panel affirms, agreeing with the motion judge that plaintiff's injuries were not foreseeable because her voluntary actions in leaving her apartment and then approaching the firefighters broke the chain of causation between defendants' negligence and her injuries. 

CRIMINAL LAW
14-2-0508 State v. Rosario, App. Div. (per curiam) (9 pp.) Defendant appeals from an order denying his petition for postconviction relief (PCR). Without the benefit of oral argument, the PCR court denied defendant's petition because it was not timely filed, where the judgment of conviction was entered on Feb. 20, 2004, and the PCR petition was filed on April 30, 2009. Although the trial judge has discretion regarding whether to grant oral argument, there is a strong presumption in favor of it on a petition for PCR. Given the short interval that elapsed after the five-year limitation period ended, the trial court erred in stringently upholding the procedural time-bar, especially in light of the fact that the court had not heard oral argument. The appellate panel remands for a determination as to whether defendant has met the requirements for relaxing the procedural time-bar. 

CRIMINAL LAW
14-2-0509 State v. Marcano, App. Div. (per curiam) (8 pp.) Defendant is charged with uttering a forged instrument, attempting to obtain a controlled dangerous substance by fraud, and attempting to obtain prescription legend drugs. By leave granted, the state appeals from the trial court's order limiting the testimony of the state's principal witness. The appellate panel reverses, finding that the physician-patient privilege does not bar defendant's doctor from testifying regarding defendant's efforts to obtain a prescription for Percocet during an office visit. 

FEDERAL COURT CASES

CIVIL PROCEDURE
07-7-0510 Giles v. Phelan, Hallinan, & Schmieg, U.S. Dist. Ct. (Simandle, U.S.D.J.) (32 pp.) Plaintiffs bring this proposed class action for damages under the Racketeering Influenced and Corrupt Organizations Act (RICO), alleging that defendants engaged in a scheme to prosecute fraudulent mortgage foreclosure lawsuits. This case presents several novel issues in this circuit, including whether the New Jersey litigation privilege bars federal RICO claims against lawyers, parties, and their representatives arising from litigation practices and whether the Noerr-Pennington doctrine bars federal RICO claims based on state foreclosure litigation. The court holds that the New Jersey litigation privilege does not bar the federal RICO claims pleaded in this case. Plaintiffs’ claims are based on defendants’ actions in petitioning the state foreclosure court. However, the court holds that the Noerr-Pennington doctrine bars plaintiffs’ RICO claims arising out of defendants’ prosecution of the Ocean County Superior Court foreclosure action because the doctrine applies to petitioning activity in all governmental departments, including the courts, and because the doctrine has expanded beyond its antitrust origins. Even if the Noerr-Pennington doctrine did not bar this action, plaintiffs’ RICO claims would still fail because plaintiffs have not pleaded that defendants’ actions were the proximate cause of their injuries. Plaintiffs’ RICO claims are dismissed with prejudice. [Filed June 4, 2013.] 

CIVIL RIGHTS
46-7-0511 Carney v. Pennsauken Township Police Department, U.S. Dist. Ct. (Kugler, U.S.D.J.) (8 pp.) Plaintiff was arrested and charged for allegedly forging a prescription. The charges were dismissed after plaintiff provided evidence that the prescription was for his mother. Plaintiff argues that due to the actions of defendants CVS and Wanda Frey, he was detained for three hours and was forced to pay an attorney to contest the baseless charges against him. CVS and Frey move to dismiss plaintiff’s §1983 claim for failure to state a claim, arguing that plaintiff cannot allege that defendants initiated a criminal proceeding against him, as required for a viable malicious-prosecution claim. Plaintiff counters that defendants initiated the proceeding when Frey maliciously reported to the police that plaintiff’s mother was a “narcotics seeker” and deceptively induced plaintiff to wait at CVS to be arrested. Because plaintiff has not satisfied the “initiation” requirement for malicious prosecution, defendants’ motion to dismiss is granted. [Filed June 3, 2013.] 

IMMIGRATION
51-8-0512 Gonzalez-Ramirez v. Secretary of the U. S. Department of Homeland Security, Third Cir. (Aldisert, U.S.C.J.) (7 pp.) Appellant Orlando Rodriguez, warden of the Elizabeth Detention Center in New Jersey, appeals from the judgment of the district court granting a writ of habeas corpus to Gonzalez-Ramirez, a citizen and native of the Dominican Republic and legal permanent resident of the United States. The district court held that because the government failed to immediately detain Gonzalez-Ramirez on his release from the five years' probation imposed after a CDS conviction, but rather waited nearly four years, he could not be held in mandatory detention during the pendency of his removal proceeding and was eligible for an individualized bond hearing under the Immigration and Nationality Act. The Third Circuit reverses in light of Sylvain v. Attorney General of the United States, which held that the government does not lose its § 1226(c) mandatory detention authority if it fails to detain an alien immediately on his release from state custody. The court also finds that because Gonzalez-Ramirez was released from preconviction custody after his arrest, there was a "release" as required for detention under § 1226(c). [Filed June 17, 2013.] 

LABOR AND EMPLOYMENT — ALTERNATIVE DISPUTE RESOLUTION
25-7-0513 Beery v. Quest Diagnostics Inc., U.S. Dist. Ct. (McNulty, U.S.D.J.) (31 pp.) Defendants move to compel arbitration in this putative class action alleging that defendants subjected female employees to a systematic pattern and practice of pay and promotion discrimination in violation of Title VII of the Civil Rights Act of 1964, the Equal Pay Act, and the New Jersey Law Against Discrimination and asserting individual claims for retaliation and sexual harassment. The court finds that although the portion of the arbitration provision in the employment contracts that plaintiffs signed containing a 90-day limitations period and certain preclaim procedures is unenforceable because it unduly restricts plaintiffs' vindication of their federal rights, that portion can be severed and the remainder of the provision is enforceable and clearly requires that this dispute be arbitrated. The forum-selection clause in the provision does not unduly impair plaintiffs' efforts to vindicate their rights under Title VII and the EPA, the provision is not procedurally or substantively unconscionable under Florida law, and defendants have not waived arbitration. The court therefore grants the motion. [Filed June 14, 2013.]  

LABOR AND EMPLOYMENT — DISCRIMINATION
25-7-0514 Garcia v. Hanwha Solarone USA Inc., U.S. Dist. Ct. (Salas, U.S.D.J.) (6 pp.) Plaintiff, a former employee of Hanwha filed a complaint in state court alleging, inter alia, that Hanwha favored employees of Korean descent and terminated him because he is not Korean, in violation of Title VII of the Civil Rights Act of 1964. Defendant removed the matter to the federal court and now moves for partial dismissal. The court grants the motion because plaintiff has not alleged any facts relating to his having filed a charge with the Equal Employment Opportunity Commission or that he received a right-to-sue letter from the EEOC. Because there is a possibility that plaintiff filed such a charge within 300 days of his termination and received a right-to-sue letter, the motion is granted without prejudice and plaintiff is given 30 days to file an amended complaint to cure the deficiency noted. [Filed June 17, 2013.]

LEGAL PROFESSION
04-7-0515 Dwyer v. Cappell, U.S. Dist. Ct. (Hochberg, U.S.D.J.) (8 pp.) Plaintiffs seek injunctive and declaratory relief under 42 U.S.C. § 1983 against defendants, who are members of the Committee on Attorney Advertising that is appointed by the New Jersey Supreme Court. Specifically, plaintiffs seek to enjoin enforcement of the committee’s Attorney Advertising Guideline 3, which precludes the use of quotations or excerpts from judicial opinions about the legal abilities of an attorney on a website or other advertisement. However, the full text of opinions, including those that discuss the attorney’s legal abilities, are permitted on a website or other advertisement. Attorney Advertising Guideline 3 is appropriately characterized as a regulatory requirement of additional disclosure and is constitutional. [Filed June 26, 2013.] [For publication.]

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