Gibbons Law Alert Blog

New Jersey Appellate Division Finds Parties’ Agreement for Arbitrator to Participate in Settlement Discussions and Continue as Arbitrator Need Not Be in Writing

In Pami Realty, LLC v. Locations XIX Inc., the New Jersey Appellate Division, in a to-be-published opinion, reversed a trial court’s determination that an agreement between litigants that an arbitrator could participate in settlement discussions and then continue as arbitrator must be in writing. After commencing litigation over a construction contract dispute, the parties agreed to participate in arbitration proceedings to resolve their dispute. On the second day of arbitration, the parties discussed settlement. When the settlement negotiations were unsuccessful, the arbitration resumed for a final day of testimony. Six weeks after the submission of post-hearing briefs, the arbitrator reported that he had finished his opinion and would be finding in favor of the defendant. Plaintiff’s counsel responded that the arbitrator “had no authority to act as a mediator in this matter and then re-assume the role of arbitrator,” and his “decision to act as mediator created a conflict of interest that neither party waived through the arbitration agreement.” After the arbitrator issued an award in favor of the defendant, the defendant moved to confirm the award. The plaintiff filed a cross motion to vacate the award, again arguing that the arbitrator had “exceeded his powers when he resumed the role of arbitrator after acting as a mediator mid-arbitration.” In a one-page statement of reasons,...

Colorado Is the Latest State to Enact a Data Privacy Law: Here’s What You Need to Know

Colorado has become the third state to enact a comprehensive data privacy statute imposing compliance obligations on legal entities that collect or process the personal data of its residents. The Colorado Privacy Act (CPA) is based on and enforces many of the same key concepts as do other data privacy statutes and regulations. As such, companies that are implementing or updating compliance programs for the European Union’s General Data Protection Regulation (GDPR), California Consumer Privacy Act (CCPA), California Privacy Rights Act (CPRA), and Virginia Consumer Data Protection Act (CDPA) will be familiar with the main provisions of the CPA and likely will have an easier time achieving compliance. There are, however, some important distinctions that companies must consider as part of any ongoing compliance efforts in anticipation of the CPA’s effective date of July 1, 2023. As a threshold matter, the CPA applies to legal entities that (i) conduct business in Colorado or produce or deliver commercial products or services that are “intentionally targeted to residents of Colorado,” and (ii) either (a) control or process personal data of more than 100,000 consumers per year or (b) earn revenue (or receive a discount on goods or services) from the sale of personal data and control or process personal data of more than 25,000 consumers. Notably, the CPA...

Buckle Up: Facebook and Instagram Seek Extreme Sanctions in Trademark Litigation Following Extensive Spoliation

In a recently filed motion in the United States District Court for the Northern District of California, plaintiffs Facebook, Inc. and Instagram, LLC (collectively, “the plaintiffs”) requested terminating sanctions pursuant to Federal Rule of Civil Procedure 37 in a trademark infringement and cybersquatting litigation against a domain registrar, based on the registrar’s destruction of over 11 million records. The motion relies heavily on a Special Master’s detailed report, which outlines egregious discovery abuses, including “ample evidence that Defendants failed to preserve responsive ESI, deleted ESI and withheld ESI.” In the motion, the plaintiffs requested a default judgment in the amount of $3.5 million ($100,000 for each of the 35 infringing domain names registered by defendant ID Shield), attorneys’ fees in the amount of $2,057,782.17, costs of the action, costs of the Special Master in the amount of $88,937, and a permanent injunction. As background, the plaintiffs sued the defendants for cybersquatting pursuant to the Anti-Cybersquatting Consumer Protection Act, trademark infringement, false designation of origin, and dilution. Numerous discovery disputes arose in the litigation, including motion practice after the defendants: (1) failed to produce documents with proper metadata; (2) designated public documents as “confidential”; and (3) did not deduplicate hundreds of thousands of pages of documents. The plaintiffs subsequently requested the appointment of a Special Master...

Gibbons Environmental Director David J. Freeman: “A ‘Bridge Builder’ Whose Vision Came to Fruition,” Featured in New York City Brownfield Partnership Interview

In June 2021, Gibbons Director David J. Freeman received the Distinguished Service Award from the New York City Brownfield Partnership, an organization he co-founded. Further honoring David for his extensive contributions to environmental law and the development of brownfields policy, the Partnership published an engaging and wide-ranging interview of David. In the interview, David describes how the Partnership’s goal of creating a bridge between the private sector and the Mayor’s Office of Environmental Remediation, which David developed with his co-founder, Dr. Daniel Walsh, grew over 15 years to include pro bono work, internships, and scholarships. The Partnership’s contributions to shaping brownfields law helped vitalize the Brownfield Opportunity Area initiative with its focus on neighborhood revitalization and community outreach. With the current focus at the federal and state levels on environmental justice for disadvantaged communities, the Brownfield Opportunity Area initiative has taken on an even more critical role.

New Jersey Enacts Three Laws with Enhanced Penalties for Employer Misclassification

On July 8, 2021, Governor Murphy signed into law three bills that amend the Worker Misclassification Package signed into law in January 2020 and intensify penalties against employers that misclassify workers. As employment practitioners across the state will recall, the Misclassification Package signed into law in January 2020 consists of a number of laws that grant the Commissioner of Labor and Workforce Development (“Commissioner”) the power to assess penalties against any employer that misclassifies its employees and to issue stop-work orders at the location where any state wage, benefit, or employment tax law violation is found. The laws included in the previously enacted Misclassification Package also allow the New Jersey Department of Labor (NJDOL) to post on its website a list of employers who have been found to misclassify their workers and to create joint liability for employers and staffing agencies for violations of state wage and hour laws. For a more detailed look at the Misclassification Package, see here.

Eleventh Circuit Holds That Administrative Feasibility is Not a Precondition for Class Certification

The Eleventh Circuit Court of Appeals recently analyzed a “hotly contested issue in class action practice” – whether administrative feasibility is a requirement for class certification under Federal Rule of Civil Procedure 23. Breaking from the First, Third, and Fourth Circuits and agreeing with the Second, Sixth, Seventh, Eighth, and Ninth Circuits, the Eleventh Circuit held putative class representatives need not prove the existence of an administratively feasible method to identify absent class members as a precondition for certification of a class action.

New Jersey Appellate Division Holds Semblance of Acknowledgement Needed for Internet-Based Terms and Conditions Arbitration Clause to Apply

In Wollen v. Gulf Streams Restoration and Cleaning LLC, the New Jersey Appellate Division, in a to-be-published opinion, reversed a trial court’s determination that a plaintiff was bound to an arbitration provision found on an internet-based company’s website. Specifically, the Appellate Court found that the plaintiff did not “knowingly and voluntarily agree to waive her right to resolve her disputes in court.” Defendant HomeAdvisor is an internet-based home improvement website that refers potential customers to third-party local service providers. A potential customer would log on to the HomeAdvisor website and create an online account in order to submit a service request. The customer was then required to provide information about the project before reaching the final webpage, which featured a button for the user to press requesting “free project cost information” from contractors in the area. An orange button with the words “View Matching Pros” was at the bottom of the page, with a line of text beneath it stating “[b]y submitting this request, you are agreeing to our Terms & Conditions.” The phrase “Terms & Conditions” was in blue and contained a hyperlink to a separate document entitled “HomeAdvisor Terms and Conditions.” However, a customer could click “View Matching Pros” without viewing the terms and conditions. Further, there was nothing to indicate that a...

Eighth Circuit Rules That Plaintiff Can File Motion to Strike Class Action Without Waiving Right to Compel Arbitration

In Donelson v. Ameriprise Financial Services, Inc., the Eighth Circuit reversed and remanded a district court’s decision that had denied both a motion to strike class action allegations and a motion to compel arbitration. The plaintiff was invited to create an Ameriprise account by defendant Sachse, who worked as a broker and investment advisor at defendant Ameriprise. The two met over lunch, where Sachse brought, and filled out himself, a copy of the account application. After the account application was signed, but not read, by the plaintiff, it was alleged that Sachse “badly mishandled [Plaintiff’s] investment account.” The plaintiff brought suit alleging violations of § 10(b) and § 20(a) of the Securities Exchange Act and Rule 10b-5, as well as breach of fiduciary duty under 15 U.S.C. § 80b-6, and, after finding other Sachse clients who had experienced similar problems with their accounts, sought to represent them in a Rule 23(b)(2) class action. The defendants moved to strike the class action allegations and to compel arbitration, which the district court denied. The defendants appealed. On appeal, the court addressed the question of whether the defendants waived their right to arbitrate when they simultaneously moved to strike the class action allegations. The court found that they had not. Ultimately, the court determined that when the defendants...

Supreme Court Limits Scope Of The Computer Fraud And Abuse Act

The Consumer Fraud and Abuse Act, 18 U.S.C. §1030 (CFAA) is a federal statute that imposes criminal penalties and provides for a civil cause of action against individuals who obtain information from a computer by intentionally accessing the computer without authorization or by exceeding authorized access. The statute has been used to criminally prosecute and bring civil actions for damages and losses against employees who have misappropriated their employers’ trade secrets or other confidential information. Those damages and losses may include attorneys’ fees expended by the employer to investigate violations of the statute. In its recent opinion in Van Buren v. United States, the United States Supreme Court resolved a disagreement among the lower federal courts over the scope of the CFAA’s “exceeds authorized access” clause. Does an employee with authorized access to his employer’s computers “exceed authorized access” only when accessing specific computer files the employee has not been authorized to access, or does the employee also “exceed authorized access” when accessing files for which the employee has authorization, but uses the information for an unauthorized purpose? In Van Buren, the Supreme Court ruled in favor of the more limited scope of the “exceeds authorized access” clause. Background When employed as a police officer in Georgia, Nathan Van Buren was the target of an...

The New Jersey WARN Act and the Coronavirus Epidemic – Update II

On January 21, 2020, New Jersey Governor Phil Murphy signed into law major amendments to the Millville Dallas Airmotive Plant Job Loss Notification Act, more commonly referred to as the New Jersey WARN Act (“the Act”). These amendments require employers with 100 or more employees to give 90-days’ advance notice to the affected employees of any reduction in force involving at least 50 employees. Employees not given the required notice may bring a civil action for damages. Even when the employer complies with the Act’s notice requirements, the amendments require the employer to pay the affected employee severance in an amount equal to one week of pay for each year of service. Failure to comply with the notice requirements will entitle each affected employee to an additional four weeks of severance pay. A fuller discussion of the amendments can be found here. The amendments were to take effect on July 19, 2020, but, because of subsequent actions by the legislature in response to the coronavirus pandemic (see here), the effective date was changed to the 90th day after the termination of Governor Murphy’s Executive Order 103, issued on March 9, 2020, which declared a Public Health Emergency and State of Emergency due to the coronavirus outbreak. Until recently, Executive Order 103 remained in place without...