A decade-long construction defect battle involving a South Padre Island, Texas, luxury condominium complex damaged during Hurricane Dolly has been resolved in a take-nothing defense win secured by attorneys of the West Mermis law firm for the general contractor, G.T. Leach Builders.

The condominium developer, Sapphire, initially sued its insurance brokers for negligence for allowing the builder’s risk insurance policy to expire, leading to claims for extensive damage to the Sapphire condominium project from the 2008 storm. Nearly three years later, G.T. Leach and several of its subcontractors were added to the $30 million lawsuit.

In a release, the firm said G.T. Leach sought to enforce the arbitration provision of its contract, with appeals ultimately progressing to the Texas Supreme Court. The company was represented by attorneys from Houston-based West Mermis, which routinely handles construction and contract disputes, products liability and general business matters.

The release continues:

The Texas Supreme Court’s decision in G.T. Leach Builders, LLC vs. Sapphire VP LP, 458 S.W.3d 502 (Tex. 2015), which sent the dispute to arbitration, stands as a landmark opinion now routinely cited in similar cases.

After settling with all other parties, Sapphire entered into arbitration with G.T. Leach in 2017. During the proceedings, the defense team, led by West Mermis name partner Lawrence J. West, provided evidence refuting multiple breach of contract claims and challenging factual allegations.

“Despite claims to the contrary, the Sapphire project had not been completed when Dolly made shore. It was imperative to show the arbitrator that our client acted reasonably and responsibly,” said Mr. West. “It was an exceptionally complex case that had endured a number of detours, but we are pleased to have secured the decisive win G.T. Leach deserved and that this chapter can finally be closed.”

Also representing G.T. Leach were West Mermis attorneys Justin W. Safady and Stephen A. Dwyer.

Wolters Kluwer Legal & Regulatory U.S. announced that registration is open for a relevant and timely webinar to provide employers with practical guidance on sexual harassment policies.

The 60-minute webinar, titled “Sexual Harassment Roundtable: Practical Guidance for Employers,” will be Thursday, March 1, 2018, beginning at 1 p.m. EST.

The event will feature experts from law firms in employment and labor law.

Topics will include:

• Why sexual harassment remains a persistent workplace problem
• The types of sexual harassment allegations that can be trickiest for employers
• Pros and cons of using nondisclosure clauses in settlement agreements
• How mandatory arbitration impacts sexual harassment claims
• Best practices for preventing sexual harassment and handling allegations when they do arise

Register for the webinar.

CNBC is reporting that an expected bankruptcy filing by Remington could jeopardize a landmark class action settlement involving the company’s iconic Model 700 bolt-action rifle, according to an attorney involved in the case.

The article quotes Mark Lanier, a lead attorney for plaintiffs: “If they file for bankruptcy, it will stay all proceedings.”

Plaintiffs claim that Remington covered up a deadly design defect that allows the rifle — and a dozen similar models — to fire without the trigger being pulled. Remington denies those accusations.

“In 2014, while still maintaining the guns are safe, Remington agreed to replace the trigger mechanisms, free of charge, on millions of guns in order to settle the case. But two Model 700 owners, Richard Denney of Oklahoma and Lewis Frost of Louisiana, appealed the settlement. They argue the agreement deliberately downplays the risks from the guns, and does not do enough to notify the public,” reports Scott Cohn.

Read the CNBC article.

A recent ruling  is a powerful reminder that the broad freedom of contract that Delaware law accords entities such as LLCs offers both the promise of great latitude to contracting parties and the threat of serious pitfalls for parties that fail to carefully protect their interests in the agreement, according to a post on the website of Cadwalader, Wickersham & Taft.

The decision also underscores the limits on an implied covenant breach claim under Delaware law.

The authors offer some takeaways from the ruling, discussing in detail:

• The implied covenant of good faith and fair dealing as applied in Delaware does not operate to rewrite contract simply because regretful plaintiffs wished they had negotiated a better or different deal
• The negotiated, mutual waiver of fiduciary duties narrows the already slim chance a Delaware court will apply the implied covenant of good faith and fair dealing
• Waiver of fiduciary duties, conditioned on a sale to an unaffiliated third party, granted the board unfettered discretion to determine the marketing and structure of the company’s sale
• Plaintiffs offered no reason to believe defendants’ conduct frustrated their reasonable expectations
• The court highlighted certain conduct that may be sufficiently egregious to implicate the implied covenant in similar situations

Read the article.

An agreement between two parties involved in an international contract may involve a mechanism, known as the “home country” provision, that provides that the party initiating arbitration must sue the other party in its home country.

A post of the website of Skadden, Arps, Slate, Meagher & Flom explains that “proponents of such clauses say they provide a disincentive to elevate disputes because a party will be reluctant to go to the other side’s home country. Though they are not widely used in large transactions (and are not recommended in arbitral literature or by arbitral institutions), they are occasionally present.”

The authors discuss two cases that illustrate that “home country” arbitration clauses may prove cumbersome to administer in practice and may result in unintended consequences for the parties.

Read the article.

As climate-change lawsuits against the oil industry mount, Exxon Mobil Corp. is taking a bare-knuckle approach rarely seen in legal disputes: It’s going after the lawyers who are suing it, according to a Bloomberg report.

Exxon’s targets include the attorneys general of New York and Massachusetts, hitting them with suits, threats of suits or demands for sworn depositions. The company claims the lawyers, public officials and environmental activists are “conspiring” against it in a coordinated legal and public relations campaign, writes Bob Van Voris.

He quotes Howard Erichson, an expert in complex litigation and a professor at Fordham University School of Law in New York: “It’s an aggressive move. Does Exxon really need these depositions or is Exxon seeking the depositions to harass mayors and city attorneys into dropping their lawsuits?”

Read the Bloomberg report.

In what appears to be a first-of-its-kind ruling, the District Court for the Southern District of New York recently concluded that a federal district court has the authority to vacate an arbitrator’s class certification award based on the due process rights of absent class members, according to a post on the website of K&L Gates.

The ruling involves the long-running Jock v. Sterling Jewelers, Inc., in which the district court and the Second Circuit Court of Appeals have rendered multiple decisions addressing the proper role of a court in reviewing an arbitrator’s authority to determine whether parties have agreed to class arbitration.

The K&L Gates authors explain that the Jock court determined that, absent an express class arbitration provision in each putative class member’s arbitration agreement, an arbitrator does not have the authority to bind absent class members to a class judgment—even if they signed the same form of arbitration agreement as the named plaintiffs.

Read the article.

The family of Parker Waldridge, one of five workers killed in the Jan. 22 gas well explosion near Quinton, Oklahoma, has hired the Texas trial law firm Deans & Lyons, LLP, to investigate and pursue a lawsuit involving the deadliest oil and gas drilling disaster since the 2010 Deepwater Horizon rig explosion in the Gulf of Mexico.

“Mr. Waldridge was an incredible man who will be terribly missed by his family,” said Deans & Lyons co-founder Michael Lyons. “While we mourn the tremendous loss experienced by all the families impacted by this tragedy, there are a number of questions raised about the circumstances of this explosion and what could have been done to prevent it.”

In a release, the firm said:

According to published reports, Waldridge, 60, of Crescent, Oklahoma, was among the workers trapped in an operations room when the first of two explosions occurred at the well site operated by Oklahoma City-based Red Mountain Energy. The drilling contractor was Houston-based Patterson-UTI Energy Inc., a company with an extensive history of fatal accidents and safety violations.

The resulting inferno was so intense that the site was inaccessible to emergency workers until the following day. An initial report by the U.S. Chemical Safety Board indicated that rig workers were preparing to change out a drill bit at the time of the explosion, but the investigation is not yet complete.

“The Waldridge family and the families of the other victims deserve to know the truth about what happened,” said Mr. Lyons. “Oil field work has inherent dangers, but this disaster appears to have been preventable if safety had been the paramount concern of this operation.”

Deans & Lyons represents clients in a broad range of complex personal injury and wrongful death claims, including cases involving the oil and gas industry.

Image by Montgomery County Planning Commission

A day after Aetna sued the claims administrator Kurtzman Carson Consultants for exposing confidential medical information about Aetna clients in a settlement notification, a KCC subsidiary brought a new suit blaming Aetna and its lawyers at Gibson Dunn & Crutcher for failing to protect the privacy of Aetna customers, according to Reuters.

The underlying case is based on the mailing of prescription notices sent to Aetna insureds. Those mailings by KCC were in envelopes that included transparent windows that displayed text including the words  “when filling prescriptions for HIV medications.”

KCC now claims that “Aetna and Gibson knew that windowed envelopes were being used in the mailings in question.” The law firm is not named as a defendant, but the firm’s actions on Aetna’s behalf are mentioned throughout the complaint, writes Alison Frankel.

Read the Reuters article.

Lawyers for Chevron Corp., hoping to keep climate-change lawsuits by California cities out of state courts, have sued Oslo-based Statoil, calling it “one of many” oil producers that should help foot the bill if the industry is found liable, reports The Los Angeles Times.

Kartikay Mehrotra writes that adding foreign companies to the litigation is a tactical maneuver to keep the dispute out of state court, where the cities have more favorable prospects, and force it into federal court.

She quotes Julia Olson, executive director and chief legal counsel for the environmental law group Our Children’s Trust: “The industry is grasping at straws while looking for any way out of these cases and using creative lawyering to do so. By cherry-picking Statoil, a sovereign Norwegian entity, Chevron hopes to reinforce federal jurisdiction.”

Read the LA Times article.

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Reuters is reporting that the board of Wynn Resorts has been sued by shareholders, claiming the board knew for years that Steve Wynn, founder and chief executive of the casino operator, had been accused of sexual misconduct and failed to investigate.

Reporter Tom Halls explains:

“The case is a derivative lawsuit, meaning any damages paid by Wynn and the other board members who are named defendants would be paid to Wynn Resorts, not directly to investors.

“The lawsuit filed in Clark County, Nevada, claimed, based on press reports, that “a board representative” was notified of Wynn’s alleged misconduct in 2009 by Wynn’s then-wife Elaine.”

Read the Reuters article.

Of all the blockbuster cases at the Supreme Court this year, Janus v American Federation of State, County and Municipal Employees (AFSCME) is expected to hold the fewest surprises, according to The Economist.

Janus, which is due to be argued on Feb. 26, asks whether public employees who choose not to join their designated union may nevertheless be charged “agency fees” to support collective bargaining. Non-members of a union may be required to subsidize contract negotiations over salary, benefits and working conditions. But those workers can’t be charged fees for a union’s political efforts, such as lobbying.

The Economist explains: “Janus is at bottom a bid to undermine America’s labour movement. The case is not presented that way; it arrives at the Supreme Court in First Amendment wrapping by express invitation from Justice Samuel Alito in a pair of recent cases.”

Read The Economist‘s article.

Above the Law examines a case in which a district court and a lawyer got into trouble with the 11th Circuit when the lower court took the lawyer’s advice not to apply the circuit’s ruling in a remanded case.

Kathryn Rubino explains that the dispute dates to 2011, when Winn-Dixie grocery store company sued more than 100 dollar stores for violating exclusivity provisions in their lease agreements. The 11th Circuit ruled in the appeal and sent the case back to the district court for application.

The problem arose when lawyers for the dollar stores persuaded the district court not to apply the ruling.

The judges singled out Troutman Sanders lawyer Brian P. Watt for statements urging the lower court not to follow the circuit’s mandate.

“Needless to say (or maybe not), a district court cannot amend, alter or refuse to apply an appellate court’s mandate simply because an attorney persuades the court that the decision giving rise to the mandate is wrong, misguided or unjust,” the panel said.

Read the Above the Law article.

Andrews Kurth Kenyon LLP will kick off its 2018 Case in Point Webinar Series on Feb. 13 with “The Dog Ate My Evidence – Tips for Implementing Litigation Holds and Avoiding Sanctions.”

The first webinar will be on Tuesday, Feb. 13, at 10 a.m. Central time. Presenters will be  Kelly Sandill and Ashley Lewis.

Destruction of evidence can lead to the imposition of substantial sanctions against a company and its non-compliant employees, the firm says on its website. An effective litigation hold can be a first line of defense against claims of spoliation or obstruction. Unfortunately, implementing a litigation hold is not always a simple process and sometimes does not go as planned.

This CLE program provides an overview of developments in the law surrounding destruction of evidence, discusses the human and technological challenges of litigation holds, provides suggestions for avoiding common pitfalls, and discusses how companies can best handle situations in which evidence has gone missing.

Register for the Feb. 13 webinar

See upcoming  events in the series

A Sixth Circuit ruling in a recent case shows that an employer’s notice of its institution of a mandatory arbitration policy or program is, without more, insufficient to compel an employee to arbitrate a subsequent dispute, writes Gilbert Samberg in Mintz Levin’s ADR: Advice From the Trenches blog.

He explains that something more is required in order to be able to infer the employee’s knowing assent to the new term of employment. The new “Employment Dispute Resolution Process” (EDRP) was promulgated after the plaintiffs had commenced employment.

Samberg writes that the appellate court “determined that the employer’s failure to notify the employees expressly that ‘they would accept the terms of the EDRP by continuing their employment’ was a critical omission, and thereupon held that the employees had not manifested knowing assent merely by continuing to work at FCA.”

Read the article.

Confidential sexual harassment settlements and accompanying attorney’s fees are no longer tax deductible under the new tax reform bill, according to a new post by Natalie Lynch of Lynch Law Firm in Austin.

In short, companies will no longer be able to use confidential settlements pertaining to sexual harassment as a tax-deductible settlement, she explains.

Non-confidential settlements can still be used for tax deductions. While the reform bill makes it clear that sexual harassment settlements that carry non-disclosure agreements can no longer be used as tax deductions, it stops short of making all confidential settlements non-deductible. Language that would include gender discrimination, retaliation, or Title IV is entirely absent in the bill.

Read the article.

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Employers can find good news and some bad news in Seyfarth Shaw’s 14th Annual Workplace Class Action Litigation, which analyzes 1,408 rulings.

The firm has posted the 57-page report on its website and has created a microsite that provides a brief overview of the survey’s findings.

David Shadovitz of Human Resource Executive also has written a summary of the report.

Shadovitz offers the good news for employers from the report: “Legal precedents and new defense approaches resulted in better statistical outcomes for employers in opposing class-certification requests for the second straight year. For instance, in wage-and-hour litigation—one of the more active categories of employment law—employers won 63 percent of decertification rulings, a success rate of nearly 20 percent from the year before.”

On the other side of the coin, he writes, the monetary value of the top workplace class-action settlements jumped more than $1 billion to a record high of $2.72 billion.

Read the Seyfarth report.

CloudNine has posted an on-demand webinar that covers key 2017 case law decisions covered by the company’s eDiscovery Daily blog and what the legal profession can learn from those rulings.

The presentation leader is Doug, VP of Products and Professional Services for CloudNine. And special consultant is Tom O’Connor, a nationally known consultant, speaker, and writer in the field of computerized litigation support systems.

Topics include:

• Handling objections to production requests
• Waiver of privilege and Rule 502(d)
• Case law related to subpoenaed production of international data
• Control of data stored by a third party
• Dictation of search terms and production scope by courts
• Form of production disputes and the issues involved
• Performing keyword search before Technology Assisted Review
• The state of sanctions with the new Rule 37(e)

Watch the on-demand webinar.

Monday’s blowout near Quinton, Oklahoma, that killed five workers is the deadliest oil and gas incident since the 2010 Deepwater Horizon disaster in the Gulf of Mexico. As this incident moves from the recovery of the victims to the cleanup and investigation stage, a prominent Texas trial lawyer says the industry must use this tragedy as a signal to self-reflect and take stock of their safety procedures, according to a post on the website of Androvett Legal Media & Marketing.

“When it comes to rig blowouts, somebody made a mistake,” says trial lawyer Frank Branson of The Law Offices of Frank L. Branson, who has handled numerous oilfield tragedies, including involvement in a 2015 onshore rig explosion where three men died in a well blowout near Midland, Texas.

“Every driller and operator knows that well control must be maintained at all times. That’s rule number one on these rigs. A failure to control the well is inexcusable and absolutely preventable. With so much at stake, companies like Patterson-UTI and Red Mountain Energy must make worker safety – not shareholder profits – the overriding priority.

“Patterson-UTI, one of the largest onshore rig operators in the U.S., has been called out for its safety shortcomings by name in Congressional reports and has been fined by OSHA following earlier oil and gas well fatalities. As the families of those killed search for answers, it’s clear that relatively toothless regulations are not enough to ensure the safety of hardworking oilfield workers. In cases like these, American jurors will be called upon to determine who was at fault and return a verdict that will make sure these companies put worker safety first.”