Author: Scott J. Etish

Third Circuit Holds Non-Signatories May Be Bound By Forum Selection Clause

In Carlyle Investment Management LLC v. Moonmouth Co., the United States Court of Appeals for the Third Circuit concluded that a non-signatory to an agreement can be bound by a forum selection clause where the forum selection clause is valid, the non-signatory is a third-party beneficiary of the agreement or closely related to the agreement, and the claim arises from the non-signatory’s status related to the agreement.

Adverse Inference Instruction Warranted For Insurer’s Breach of Retention Policy

It should come as no surprise that litigants continue to ignore such basic discovery obligations as the duty to preserve potentially relevant documents once litigation is reasonably anticipated. A recent case out of the Northern District of New York exemplifies the importance of patience in establishing a record of discovery abuses, including data deletion, before seeking sanctions to address such situations.

Pennsylvania Supreme Court Concludes That Dissenting Shareholders’ Post-Merger Recourse Is Limited to Judicial Appraisal

As discussed in a previous post, the Third Circuit’s August 2012 ruling in Mitchell Partners, L.P. v. Irex Corp. predicted that the Pennsylvania Supreme Court would “permit a post-merger suit for damages based on the majority shareholders’ breach of their fiduciary duties.” As a result, the Third Circuit concluded that Pennsylvania’s appraisal statute did not preclude dissenting minority shareholders who are “squeezed out” in a merger from seeking remedies beyond the appraisal remedies provided in the statute. However, on certification, the Pennsylvania Supreme Court concluded that minority shareholders who oppose a merger have no recourse — in the absence of fraud or fundamental unfairness — other than to seek judicial appraisal of the value of their post-merger shares.

New Jersey District Judge Upholds Sanctions for Camden County’s Grossly Negligent Litigation Hold Procedures

On March 21, 2012, New Jersey District Judge Noel Hillman upheld Magistrate Judge Ann Marie Donio’s ruling against Camden County, New Jersey (the “County”) for spoliation of evidence in an insurance dispute arising out of injuries to a motorist on a county road. State National Insurance Co. v. County of Camden, 08-cv-5128 (D.N.J. March 21, 2012). Judge Hillman’s March 21, 2012, decision addresses the County’s appeal of a June 30, 2011, decision of Judge Donio granting State National Insurance Company’s (“State National”) motion regarding the County’s failure to preserve electronically stored information (“ESI”). Specifically, the County failed to institute a litigation hold, to disable its automatic email deletion program, and to preserve copies of its backup tapes after litigation was commenced.

In re Facebook Privacy Litigation – Uphill Battle for Plaintiffs

In a recent case in California, Facebook account holders filed a putative class action lawsuit against Facebook, alleging that Facebook knowingly forwarded personal information to online advertisers without its users’ consent. In In re Facebook Privacy Litigation, Plantiffs asserted eight causes of action against Facebook, including violations of the Electronic Communications Privacy Act, 18 U.S.C. §§ 2510, et seq. and various California laws (both statutory and common law), and all were dismissed.

Minority Shareholders Not Precluded From Seeking Damages for Majority Shareholders’ Post-Merger Breaches of Fiduciary Duty

In Mitchell Partners, L.P. v. Irex Corporation, et al., the Third Circuit concluded that Pennsylvania’s appraisal statute does not preclude dissenting minority shareholders who are “squeezed out” in a merger from seeking remedies beyond the appraisal remedies provided in the statute. In the precedential ruling, the Third Circuit predicted that the Supreme Court of Pennsylvania would “permit a post-merger suit for damages based on the majority shareholders’ breach of their fiduciary duties.”

Caution to Anonymous Internet Posters – Your Cover Might Be Blown

Next time you consider posting something on the Internet, think again as your identity could be revealed! Under the presumed cloak of anonymity, individuals often throw caution to the wind and voice controversial and unfiltered views on the Internet. Based upon a recent ruling by an Indiana State Court in a defamation case, however, the rules of engagement on the Internet may have changed.

Blind CCs and “Replies to All” – An Email Trap for the Unwary Attorney

Some traditional practices from the paper era don’t translate well to the world of e-communication. And some are downright dangerous. Back in the day, attorneys would often “bcc” their clients on correspondence to adversaries, an efficient and relatively safe means of keeping the client apprised. No longer in the age of email, where the ability to instantly respond invites quick, at times reactionary, replies that can easily fall into the wrong hands, with potentially devastating consequences.

“Cached” Web Files May Serve as Evidence in Child Pornography Case

In a prosecution for promoting and possessing computer images of child pornography, a Brooklyn appellate panel upheld the conviction of defendant and determined that temporary files automatically “cached” by an internet browser may serve as evidence of promoting and possessing child pornography. People v. Kent, ___ A.D.3d ___, 2010 N.Y. Slip. Op. 7364, 2010 N.Y. App. Div. LEXIS 7405 (App. Div. 2d Dept. Oct. 12, 2010). The defendant, a professor of public administration at a Dutchess County college, was found guilty of 134 counts of possession of a sexual performance and 2 counts of promotion related to his use of an office computer.

The 2010 E-Discovery Landscape: Panel Discussion on the Essential E-Discovery Decisions of 2010 at Gibbons Fourth Annual E-Discovery Conference

Gibbons’ Fourth Annual E-Discovery Conference kicked off with a panel discussion on the essential e-discovery decisions from 2010. The panel, comprised of renowned e-discovery authority Michael Arkfeld of Arkfeld & Associates, Scott J. Etish, Esq., an associate at Gibbons and member of the firm’s E-Discovery Task Force, and the Hon. John J. Hughes, United States Magistrate Judge for the District of New Jersey (Retired), addressed numerous recent decisions related to the following areas: (1) the need for outside and inside counsel to monitor compliance; (2) obtaining electronically stored information from foreign companies; (3) cooperation between adverse parties; (4) social media discovery; (5) searches and inadvertently disclosed privilege documents; and (6) legal holds and sanctions. The panel provided guidance as to best practices related to numerous areas, including navigating e-discovery challenges in the aftermath of the seminal Pension Committee, Rimkus and Victor Stanley II decisions. A brief summary of all of the cases the panel discussed is available here, and a copy of the PowerPoint slides the panel used is available here.