Gibbons Law Alert

Gibbons Law Alert Blog

Federal Circuit Overturns Supplemental Jurisdiction Over Claims of Breach of Fiduciary Duty

On August 5, 2016

In a recent decision from the Federal Circuit in AngioScore, Inc. v. TriREME Medical LLC et al. the court found that a plaintiff’s claim for patent infringement and breach of fiduciary duty did not have the requisite “common nucleus of operative fact” for the district court to maintain supplemental jurisdiction over breach of fiduciary duty claims. In particular, this decision provided the Federal Circuit a rare opportunity to review the jurisdiction limits of a district court in a case involving federal patent infringement claims and state law claims for breach of fiduciary duty aiding and abetting and unfair competition by an independent director and companies he co-founded which developed a competitive product to a product marketed by the plaintiff corporation AngioScore, Inc.

New Jersey Supreme Court Holds Denial of Right to Jury Trial Not Within Panoply of Sanctions in a Trial Court’s Arsenal

by Caroline E. Oks

Posted in General Litigation

On August 4, 2016

Recently, the New Jersey Supreme Court unanimously held that trial courts may not deprive civil litigants of their constitutionally protected right to a jury trial as a sanction for failure to comply with a procedural rule. In Williams v. American Auto Logistics, the pro se plaintiff’s complaint did not include a jury demand, but the defendant’s answer did. The defendant later sought to waive its jury demand, but the plaintiff withheld his consent, which was required by court rules. Notwithstanding the lack of consent, the trial judge granted the request to waive the jury as a sanction against the plaintiff for his failure to provide the pre-trial disclosures required by Rule 4:25-7. The Appellate Division affirmed the trial court’s waiving of the jury as a sanction for the plaintiff’s failure to comply with Rule 4:25-7.

New Jersey’s Time of Application Rule Does Not Bar a Favorable Zoning Amendment

by Howard D. Geneslaw

Posted in Development/Redevelopment

On August 2, 2016

In a published decision, the New Jersey Appellate Division ruled on July 27 that the “time of application” rule, which mandates that development applications are governed by the regulations in effect at the time of submission, and was intended to protect applicants from negative zone changes while their applications were pending, does not apply to zone changes which benefit a project.

Newark Requires Developers to Identify Environmental Impacts of Projects

by Gibbons P.C.

Posted in Development/Redevelopment / Environmental and Green Issues

On July 29, 2016

Recently, the City of Newark (the “City”) approved Ordinance No. 16-0803, a/k/a the Environmental Justice and Cumulative Impacts Ordinance, (the “Ordinance”), which may significantly impact the process for seeking development approvals from the City. The Ordinance purports to advance the policy of promoting environmental justice, environmental stewardship, and sustainable economic development in the City. More specifically, the Ordinance seeks to mitigate the disproportionate impact of pollution and environmental degradation on the health of minority and socioeconomically disadvantaged communities, otherwise known as “environmental injustice.” As the Ordinance notes, the prevalence of environmentally overburdened, underserved, and economically distressed communities near industrial centers and other areas afflicted by poor environmental quality is well documented.

Parties Must Clearly Agree to Delegate Arbitrability to an Arbitrator, Says the NJ Supreme Court

by Michael R. McDonald and Kate E. Janukowicz

Posted in Class Action Defense / General Litigation

On July 28, 2016

In its most recent pronouncement on arbitration clauses, the New Jersey Supreme Court confirmed that it is for the Court, and not an arbitrator, to determine whether the parties have agreed to arbitrate consumer fraud claims in the absence of a clear delegation clause to the contrary. In Morgan v. Sanford Brown Inst., the New Jersey Supreme Court reversed an order of the Appellate Division holding that arbitrability was for the arbitrator to decide, finding that under Atalese v. U.S. Legal Servs. Grp. and First Options of Chi., Inc. v. Kaplan, the agreement to delegate arbitrability to an arbitrator must, as with the other arbitration provisions, clearly inform the average consumer of the rights he or she is giving up.

N.J. Appellate Division Holds that Municipalities are not Obligated to Satisfy “Separate and Discrete” Gap Period Need for Affordable Housing

by Cameron W. MacLeod

Posted in Development/Redevelopment

On July 28, 2016

On July 11, 2016, in an interlocutory appeal, the Appellate Division reversed Judge Mark A. Troncone’s February 18, 2016 order, which had found, as a matter of law, that municipalities were obligated to provide realistic opportunities for the construction of affordable housing for the need that accumulated during the period from 1999-2016 (the “gap period”). In an opinion by Judge Fasciale, the Appellate Division held that municipalities were not required to discretely calculate or satisfy the housing obligations that accumulated during the gap period as part of a municipality’s “prospective need.” In the Appellate Division’s view, those who are living in dilapidated, overcrowded, or cost-burdened housing would be adequately reflected in present need calculations, and any further alterations to municipal obligations would require legislative or executive action. The opinion highlights what appears to be a distinction between the constitutional fair share housing obligation, which had been understood to accrue year after year according the Court’s decision in Mt. Laurel II, and the compliance obligations arising under the Fair Housing Act, which are limited only to satisfying the statutorily prescribed need.

NJ Supreme Court Broadens Scope of LAD’s “Marital Status” Protection

by Gibbons P.C.

Posted in Discrimination

On July 27, 2016

On June 21, 2016, in Smith v. Millville Rescue Squad, the Supreme Court of New Jersey addressed the scope of the marital status protection afforded to employees by the Law Against Discrimination (LAD). The Court ruled that the LAD’s marital status provision is not limited to the state of being single or married but protects employees who have announced “they will marry, have separated, have initiated divorce proceedings or have obtained a divorce.”

Privately Financing the Public Good: Using Public-Private Partnerships to Inject Private Financing into Public Projects in New Jersey

by Gibbons P.C.

Posted in Economic Development

On July 26, 2016

New Jersey has a higher inventory of worthy infrastructure projects than it has money to fund sorely needed improvements. Although New Jersey has the seventh highest revenue of any state, the pressures of being a densely populated commuter state often impose significant liabilities on those revenues such that the State is often faced with having to choose between worthy projects because available financing is limited. One common sense solution gaining significant traction is the injection of private financing into public projects in order to relieve some of the State’s financing burdens. Often referred to as public-private partnerships or P3s, these agreements trade a limited, future revenue stream over time to a private corporation in exchange for a fiscal commitment allowing a project to put shovels in the ground. These projects can take various forms: construction of state college dormitories in exchange for rents, maintenance of highways in exchange for availability payments, or construction of a bridge in exchange for toll rights, to name a few. The State entity receives an influx of capital to address infrastructure needs and the private entity receives a long term profit from rents, tolls, availability payments, or maintenance agreements. The elegance of this type of solution is that design, procurement, and initial construction can all overlap because they are being...

Wrap Up of United States Supreme Court’s 2015-2016 Term

by Gibbons P.C.

Posted in General Litigation

On July 26, 2016

With the close of the United States Supreme Court’s 2015-16 term, we offer this wrap up of the Court’s term, focusing on decisions of special interest from the business and commercial perspective (excluding patent cases): Upon being granted a discharge from a Bankruptcy Court, a bankrupt’s debts are discharged unless a particular debt falls within one of the Bankruptcy Code’s statutory exclusions. One of those exclusions is for debts arising from “false pretenses, a false representation, or actual fraud.” Husky Int’l Elecs., Inc. v. Ritz asked whether a debt arising from a fraudulent transfer made for the purpose of frustrating a creditor, but accomplished without making a false representation, is subject to this exclusion.

Arbitration Clause Held Too Vague to Cover Statutory Claims

by Gibbons P.C.

Posted in Alternative Dispute Resolution

On July 25, 2016

Employers drafting arbitration clauses for employment contracts and others drafting arbitration agreements generally need to be familiar with the line of New Jersey cases involving arbitration clauses, including the Appellate Division’s recent opinion in Anthony v. Eleison Pharmaceuticals LLC, Docket No. A-932-15T4 (App. Div. July 18, 2016), where the court held that an arbitration clause that does not include reference to a waiver of plaintiff’s statutory rights or a jury trial does not constitute a valid waiver of the right to have claims decided in a judicial forum.