Gibbons Law Alert Blog

Safety First: Counsel Should Take Affirmative Steps to Ensure ESI Is Being Preserved

In the advent of the 2015 amendment to Rule 37(e), courts have made clear that counsel’s obligation to ensure the preservation of ESI extends beyond the mere issuance of a litigation hold. Instead, to avoid possible sanctions, counsel must take affirmative steps to ensure the client’s compliance with the litigation hold to prevent the destruction of relevant ESI. In multidistrict litigation over a hazardous spill, In re Gold King Mine Release, defendant Harrison Western Construction Corporation (“Harrison”) was sanctioned for its failure to preserve and produce relevant documents related to its work on a Colorado mine prior to the release of millions of gallons of toxic waste. In its 2019 discovery requests, the state of Utah sought documents related to the work Harrison performed or planned to perform at the mine in 2014 and 2015. In response, Harrison was unable to provide most of the requested documents from that time period, claiming – through a third-party IT consultant – that a “catastrophic event” occurred during Harrison’s migration of documents to a new server. Because Harrison could not produce the requested documents, Utah moved for sanctions under Federal Rules of Civil Procedure 37(b) and (e); however, the court seemingly only analyzed Utah’s application under Rule 37(e). In its analysis under Rule 37(e), the court focused on Harrison’s...

Unraveling Environmental Legal Complexities: Lessons from the Clarios Case and RIP Waivers

A recent February 5, 2024, decision by the New Jersey Superior Court Appellate Division delivered a significant blow to Clarios, LLC (Clarios), a car battery manufacturer facing environmental scrutiny at its New Brunswick plant. This recent decision has echoed through the environmental legal landscape, leaving companies contemplating the use of Remediation in Progress Waivers (RIP waivers) with critical questions and a renewed sense of caution. The case, far from offering definitive answers, instead highlights the intricate interplay between property rights, environmental stewardship, and the nuances of due process protections. Moreover, the court’s denial of Clarios’s request to postpone remediation has broader implications for scenarios involving joint liability agreements and property transactions, highlighting the complex challenges associated with RIP waivers. By dissecting the court’s reasoning and its implications, we gain valuable insights into the limitations and prudent utilization of RIP waivers, ensuring responsible environmental practices and mitigating unintended legal consequences. Decoding the Chain of Title of the RIP Waiver The complex history of the RIP waiver granted to Clarios in 2007 finds its roots in the ownership transition of the site. Delphi Automotive Systems, LLC (Delphi), the former owner, had been manufacturing automobile batteries at the location. In 2006, Delphi sold the property to Johnson Controls Battery Group, Inc., a corporate predecessor of Clarios, triggering a sequence of...

Gibbons to Present Live CLE Seminar: “Keys to Negotiating Better Software and Software-as-a-Service Agreements”

From April 16-18, Peter J. Frazza, a Director in Gibbons’s Business & Commercial Litigation Group, will lead a seminar in Las Vegas analyzing the negotiation of software licenses and software-as-a-service agreements, addressing artificial intelligence, the Internet of Things (IoT), and data protection and privacy issues specific to software transactions. Mr. Frazza will leverage his 40+ years of experience handling complex lawsuits and contract negotiations on behalf of licensees and users, in order to provide a substantive, insightful overview and practical action steps to optimize your negotiation strategies in an ever-changing technology environment. This seminar is ideal for: Chief Information Officers Chief Technology Officers Chief Financial Officers Contract Negotiators In-House Counsel IT/IS/MIS Managers Contract Managers Contract Administrators Purchasing/Procurement Agents Consultants CLE INFORMATION New Jersey: Gibbons P.C. is an accredited MCLE provider in the State of New Jersey. This program has been approved by the Board on Continuing Legal Education of the Supreme Court of New Jersey for 18.0 hours of total CLE credit. Of these, 0 qualify as total hours of credit for Ethics and Professionalism, including 0 hours in diversity, inclusion, and elimination of bias, and 0 qualify as hours of credit toward certification in civil trial law, criminal trial law, workers compensation law, municipal court law, and/or matrimonial law. New York: Gibbons P.C. has been...

New Jersey’s Consumer Data Privacy Statute – What You Need to Know

On January 16, 2024, Governor Murphy signed S332 into law, making New Jersey the 13th state to enact legislation designed to protect the personal data of its residents. The law will become effective next year, on January 15, 2025, and imposes various obligations on a person or entity (designated as either a “controller” or a “processor”) that collects, discloses, processes, or sells the personal data of New Jersey consumers. The statute establishes various rights for New Jersey residents with respect to their own personal data and also provides consumers with the ability to opt out of disclosure and sale of their personal data in certain circumstances. Finally, the Division of Consumer Affairs has the authority to develop rules and regulations necessary to effectuate the purposes of the statute, and the Attorney General has sole and exclusive enforcement authority. The scope of S332 signed by the Governor was expanded significantly from prior versions. As late as December 17, 2023, the bill only applied to a person or entity that operated “any service provided over the Internet that collects and maintains personally identifiable information from a consumer.” The law enacted less than one month later, however, is not limited to collection of data over the internet; it applies to all “personal data” regardless of how it is...

Corporate Counsel Is Not Your Counsel: Communications Between Shareholders and Corporation Counsel Are Not Necessarily Privileged

You founded, own, and run your company. So, it is natural to assume that your company’s lawyer is your lawyer, right? While the assumption may be natural, the courts are firm in differentiating an attorney’s responsibilities to a corporation versus an individual shareholder. One who disregards this distinction may find that communications believed to be confidential and privileged are subject to discovery in later litigation. “A lawyer employed or retained to represent an organization represents the organization as distinct from its directors, officers, employees, members, shareholders or other constituents.” NJRPC 1.13(a). Shareholders of a closely held corporation are no exception to this rule and are not entitled to any presumption of privilege distinct from the corporate entity. The New Jersey Appellate Division recently emphasized this point in Royzenshteyn v. Pathak, where two shareholder-owners of a closely held corporation unsuccessfully appealed a trial court order that compelled production of allegedly privileged communications between the plaintiffs and corporate counsel. In Royzenshteyn, the plaintiffs retained corporate counsel for a transaction that transferred majority ownership of their corporation to the defendants. That transaction was completed in 2015. Soon thereafter, the parties’ relationship soured, and, in 2018, the plaintiffs retained new counsel to file a lawsuit that challenged the 2015 transaction. During discovery, the plaintiffs asserted attorney-client privilege over communications...

A Look Ahead: The 221st Legislature and State of the State Address

On Tuesday, the 221st Legislature commenced in Trenton. The Senate welcomed 10 new Senators to the chamber, namely: Sen. Carmen Amato, Jr. (LD9); Sen. John Burzichelli (LD3); Sen. Owen Henry (LD12); Sen. John McKeon (LD27); Sen. Angela McKnight (LD31); Sen. Paul Moriarty (LD4); Sen. Raj Mukherji (LD32); Sen. Parker Space (LD24); Sen. Britnee Timberlake (LD34); and Sen. Latham Tiver (LD8). Senators McKeon, McKnight, Moriarty, Mukherji, Space, and Timberlake each moved over to the Senate after serving in the General Assembly during the last session. Sen. Nick Scutari, of Union County, was elected to continue as Senate President, and Sen. M. Teresa Ruiz, of Essex County, will continue as the Senate Majority Leader. Sen. Shirley Turner, of Mercer County, has been named President Pro Tempore, a position she previously held twice, and Sen. Anthony Bucco, of Morris County, will continue as the Senate Minority Leader.

Is “Per Se” Getting in the Way? Use of That Term in Defamation Law

The twin branches of defamation consist of libel and slander. Libel is defamation by written words or by the embodiment of the communication in some tangible or physical form. Slander consists of the communication of a defamatory statement by spoken words or transitory gestures. Although attorneys, and even courts, sometimes refer to “defamation per se” as a third category of defamation, such reference is incorrect as it misunderstands the term “per se” in the defamation context. Properly understood in the context of slander, the phrase “per se” refers to four highly specific accusations that have traditionally been considered so clearly damaging to reputation that the damage element of the tort is deemed satisfied by the very utterance of the words: (1) accusing another of having committed a criminal offense (2) accusing another of having a loathsome disease (3) accusing another in a way that affects his/her business, trade, profession, or office (4) accusing a woman of being unchaste As to categories (3) and (4), the New Jersey Appellate Division later recharacterized them, respectively, as “accusing another of engaging in conduct, or having a condition or trait, incompatible with his or her business” and “accusing another of having engaged in serious sexual misconduct.” In the context of libel, “per se” refers to a writing that is...

Environmental Group’s David J. Freeman to Co-Chair NYSBA’s Superfund/Brownfield Program Update 2023

The New York State Bar Association Environmental & Energy Law Section is presenting a virtual conference on the state’s brownfield and federal Superfund programs on Tuesday, December 5. Gibbons’s David J. Freeman, Environmental Group Senior Counsel, is Co-Chair of the conference, which will feature a distinguished faculty comprising government officials, attorneys, and consultants in the field to review recent developments in both programs. In addition, Mr. Freeman will moderate the panel discussing the federal Superfund program. The CLE event will also feature a panel discussion on current issues in environmental insurance and an update on recent case law involving Superfund and brownfield issues. For more information about the program or to register to attend, please click here.

The Gibbons Government & Regulatory Affairs Group’s 2023 General Election Recap

Many political pundits predicted that the 2023 General Election would mirror the 2021 vote, when Republicans picked up seats in the State Legislature by defeating incumbent legislators. A historical repeat seemed possible since the Legislature was running in new districts under a “consensus” map agreed to by both parties, recent polling data has indicated that President Biden has become less popular in New Jersey, and the issues at the forefront created opportunities for the minority party. The most closely watched legislative districts were Districts 3 and 4 in the southern part of the state, Districts 11 and 16 in the central region, and District 38 in northern New Jersey. It was the Democrats, however, who flipped the script from 2021 and ended up gaining five seats in the State House by holding off challengers and defeating incumbent and favored Republican candidates: In Legislative District 3 (Gloucester/Salem/Cumberland Counties), incumbent Republican Senator Ed Durr lost to former State Assemblyman John Burzichelli. Senator-elect Burzichelli’s running mates for the Assembly, Heather Simmons and Dave Bailey, appear on track to defeat incumbent Republican Assemblywoman Bethanne McCarthy Patrick and Thomas Tedesco. These results will flip the Third District from Republican to Democrat. With three open seats in Legislative District 4 (Camden/Gloucester Counties), incumbent Assemblyman Paul Moriarty won an open Senate seat...

What Employers Should Know About Biden’s AI Executive Order

On October 30, 2023, President Biden issued an Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence (AI). The sweeping Executive Order sets out standards for safe and secure uses of AI with an emphasis on privacy protections, the promotion of innovation and competition, avoiding discrimination and bias, and supporting workers. The Executive Order requires principles and best practices to be established by the Secretary of Labor within 180 days of the Executive Order. The principles and best practices will provide guidance for employers to “mitigate AI’s potential harms to employees’ well-being and maximize its potential benefits.” The principles and best practices must address the following, • job-displacement risks and career opportunities related to AI, including effects on job skills and evaluation of applicants and workers • labor standards and job quality, including issues related to the equity, protected activity, compensation, health, and safety implications of AI in the workplace • implications for workers of employers’ AI-related collection and use of data about them, including transparency, engagement, management, and activity protected under worker-protection laws Agencies will likely adopt the Secretary of Labor’s guidelines, as appropriate and consistent with applicable laws. We can also expect guidance on AI workforce development, as well as employee monitoring, which would ensure that workers whose...