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Bloomberg Businessweek posted an interesting video featuring Sheryl Sandberg, chief operating officer of Facebook, Inc. talking about how women don’t identify themselves as “ambitious” and don’t seek leadership roles in business organizations. Check it out here.

She analyzes what creates this “ambition gap” that prevents women from becoming CEOs or seeking other leadership roles. Part of it is a perception that powerful and successful women aren’t likeable. Part of it is that women are actively discouraged from being ambitious at an early age. Part of it is that women still take on the lion’s share of work at home, even when they work full-time outside the home as well.

This “ambition gap” is certainly evident in law. Women go to law school in equal numbers as men, but few make it to equity partner at law firms. The women I know are certainly ambitious in law school and sought to be the Editors in Chief of law review and other journals, chief justice of the moot court, and tops in the class rank for GPA. Over time, however, those ambitious female law students gravitate away from becoming equity partners – or they are pushed out.

As a female trial attorney, there is another consideration. Jurors need to perceive a party’s attorney as credible, trustworthy, and who are enthusiastic. (See, for example, this article posted by American Law School about the power of persuasion. On page 19 of the excerpt, page 4 of the posted PDF, the author discusses how jurors are influenced by the likeability of an attorney.) Powerful and effective female trial lawyers have to balance that line between appearing successful, confident, enthusiastic, but still likeable. It can be a challenge for a female attorney to aggressively cross examine a witness, without bankrupting all the rapport and “likeability” built up with jurors earlier in the trial.

Given these considerations, should people hiring a lawyer think about hiring a man who can negotiate more forcefully and cross examine a witness more aggressively without losing likeability? Sandberg addresses this problem with the resounding answer no. She illustrates the point with a great quote by Warren Buffet, who said that one key to his success was that he “was privileged to work during a period when it was only necessary to compete against half the population.” Clearly, allowing women to step aside and surrender leadership roles – in an organization or on a trial team — removes half the talent available to a client or to a firm. For example, I am adept at some of the newest trial technology, because I had the privilege of being a Graduate Research Fellow for the Center for Legal and Court Technology when I was a law student at William and Mary. There I learned technology-assisted trial advocacy from some of the best and I have the ability to understand the intersection between traditional trial tactics and the capabilities of new technologies better than many other attorneys at my firm. That is a knowledge base worth keeping, even if I face some unique challenges as a female trial attorney.

I welcome your ideas on how to balance the need for women to be successful while staying “likeable” and how to keep top female talent in the spotlight at law firms and on litigation teams. How do you strike the balance? How do you think firms and clients can use their talented female attorneys better? Can we cure the “ambition gap” by changing perceptions of successful women?

The new rule from the Department of Transportation prohibits commercial motor vehicle (CMV) drivers from holding, dialing, or reaching for a hand-held mobile phone while driving, except for emergency purposes. This rule applies to buses and trucks on interstate routes.

Commercial motor vehicle (CMV) means a motor vehicle or combination of motor vehicles used in commerce to transport passengers or property if the motor vehicle:

1.  Has a gross combination weight rating or gross combination weight of 11,794 kilograms or more (26,001 pounds or more), whichever is greater, inclusive of a towed unit(s) with a gross vehicle weight rating or gross vehicle weight of more than 4,536 kilograms (10,000 pounds), whichever is greater; or
2.  Has a gross vehicle weight rating or gross vehicle weight of 11,794 or more kilograms (26,001 pounds or more), whichever is greater; or
3.  Is designed to transport 16 or more passengers, including the driver; or
4.  Is of any size and is used in the transportation of hazardous materials as defined in the law. http://www.fmcsa.dot.gov/rules-regulations/administration/fmcsr/fmcsrruletext.aspx?reg=383.5
Hands-free use of cellular phones is allowed. This new regulation does not affect Citizen Band Radio, GPS or fleet management system use.

Drivers can be fined $2,750 per violation and carriers may be fined $11,000.

It is recommended that employers institute new employee guidelines and training in order to be in compliance.

If you should need any assistance with developing a policy, the employment law lawyers at Sands Anderson PC would be pleased to assist.

Anyone who has been a defendant in a lawsuit will tell you that the process is expensive, time consuming and stressful. I have spent the past twenty years defending businesses and individuals in courts throughout Virginia and can attest to the emotional and financial toll which a lawsuit can have on the litigant. This article will focus on what steps a business in general and a builder in particular can take to make this process as painless as possible.

There are some steps a builder can take to defend itself even before a lawsuit is filed. Frequently, a builder will have some inclination that a lawsuit is imminent. If that is the case, one should make sure to preserve all evidence, including putting a hold on all e-mails, correspondence and other documents which may be relevant. Courts can impose heavy sanctions when evidence is discarded, even unintentionally, when a party has reason to know that a claim might be filed. Taking photographs of the project is very important, especially since access to the property will be restricted once the case is in suit.

Once a plaintiff files a lawsuit, Virginia law allows the party to wait for up until one year before the complaint has to be served on the defendant or its registered agent. Once the defendant has been served, it is important to promptly notify your attorney and liability insurance carrier or agent. Notifying the insurance company, even as early as the time when a builder has reason to believe that a suit may be filed, could have the effect of having insurance company hire a lawyer at the insurer’s expense to defend the law suit. An insurer’s requirement to defend and indemnify a builder for a construction defect claim is a subject for another article, but placing the carrier on notice of a law suit is a step which a defendant should take.

After the lawsuit has been served, a defendant has twenty-one days to file responsive pleadings. These pleadings can come in a variety of forms, depending on the nature of the asserted claims and the defendant’s available defenses. Some early responsive pleadings can focus on a discreet issue, such as whether the lawsuit was timely filed, and can allow a defendant an opportunity to dismiss a meritless claim early in the proceedings. In many lawsuits, a general contractor may want to assert claims against third parties not named as defendants, such as a sub-contractor whose work led to the defect at hand. If the lawsuit involves injury to an employee of a subcontractor, a plea asserting that the injured employee’s sole remedy is through workers’ compensation may also be pursued. In a defect case brought by a homeowner against a subcontractor, a valid dispositive defense may be that the lack of a contract between the parties is fatal to the homeowner’s case. The defendant will need to coordinate strategy with its lawyer to make sure that the proper defenses have been asserted in a timely manner.

After responsive pleadings have been filed and preliminary motions argued before the court, the parties will typically launch into the discovery phase whereby each side tries to learn what information the other side has. Our system is designed for the full exchange of documents and information between the parties. Construction lawsuits typically involve the exchange of hundreds or thousands of pages of documents. Many trees have died at the hands of construction lawyers. The parties will also be required to answer under oath written questions, referred to as “interrogatories.” The parties are also allowed to issue subpoenas to non-parties to obtain their records. Documents can also be sought from governmental agencies, such as building inspectors’ offices, through Freedom of Information Act requests.

Retaining the right expert witnesses is a critical step in the pre-trial process. Most construction cases involve engineering, architectural and building code issues on which expert witnesses can offer their opinions. There is no shortage of available experts of varying quality throughout Virginia. It is important not to rush into retaining an expert. Carefully checking the expert’s background, qualifications and ability to testify well in front of a jury are all critical steps.

Once documents have been exchanged, interrogatories answered and each side has become thoroughly familiar with the other side’s position and theories, the next stage in the discovery process involves the taking of depositions of the parties and important witnesses, including experts. At its essence, a deposition is a question and answer session in which the lawyer asks the deponent questions under oath. A court reporter is present, transcribing the testimony. The scope of questions which can be asked in a deposition is much broader than what would be admissible at trial. There is no judge present to rule on objections made during a deposition, and the parties are largely left to self-police their conduct. The vast majority of depositions, while they can certainly be contentious, run smoothly without the need for the lawyers to place a call to a judge for intervention. A deposition, however, can be very long, depending on such things as the complexity and quantity of issues, the amount of money at stake, the reasonableness of the lawyer and the amount of material to cover, among other factors.

By the time the discovery phase has been completed, and usually well before that time, the parties should be in a position to evaluate their strengths and weaknesses. Most cases will settle out of court. However, with the economy as it is, my experience of late has been that builders are frequently financially unable to settle cases which would require that they spend even modest amounts of money.

In the event that the parties are unable to reach a settlement, the case will generally proceed to trial. Under our system, either party may require that a court empanel a jury consisting of seven citizens to decide factual disputes. In my experience, juries have little patience for either plaintiffs or defendants in construction dispute cases and frequently will not be able to understand the subtleties of complex issues which frequently are found in such cases. For these reasons, the parties may well be better off having their case tried by a judge rather than a jury. Invariably, each side will have volumes of exhibits to introduce into evidence. Such exhibits can include documents, photographs, inspection reports and other records. The parties should give a lot of thought to stipulating to the admissibility of non-controversial exhibits in order to speed up the trial and allow it to run more efficiently. Of course, witnesses will also testify at the trial. Assuming the judge does not dismiss the case for one reason or another during the trial, the case would then be submitted to the court or jury for its consideration of the law and evidence after the lawyers have completed their closing arguments.

There is no question that law suits are expensive, time consuming and stressful for all. Knowing the process and having good communication with counsel can, however, help make the process more bearable.

In fact, this Veterans Day, the Virginia Bar Association is really working to get the word out and raise money and sign up pro bono volunteers to meet the needs of Veterans in Virginia. Please visit their website to learn more: www.vba.org/veterans.

Sands Anderson is also supporting the effort this year by raising money to help the Helping Military Veterans through Higher Education (“HMVHE”) program, a consortium of Virginia’s colleges and universities that use the resources of their graduate programs to assist veterans with their legal, medical, psychiatric, and veterans benefits needs.

I am lucky to work with many veterans who have used their military service in their law practices. Al Orgain and John Butler are both former military aviators who use that experience in their aviation practice. Doug Winegardner uses his experience as a Navy JAG not only as a litigator, but to develop a maritime practice. (Sadly, he says it is almost nothing like this: 

Good thing he actually was in the Navy and not just a school play!) Army Captain Stacey-Rae Simcox has also been a mentor and inspiration to me throughout law school and my law practice.

So what are your stories? How have veterans inspired you? Please leave a comment if you are participating in any Veterans Day activities, even if it is just a $10 donation to help fund the clinics around Virginia to give back to those who inspire us every day.

Legal Ethics Opinion 1858 (LEO 1858), issued July 27, 2011, is of particular interest to all parties, especially with the introduction of the SCHIP Extension Act of 2007, which requires certain entities, including liability carriers, to report certain payments made to plaintiffs to the Center for Medicare and Medicaid Services (CMS). The goal of this legislation is to protect Medicare’s interest as a secondary payer. Because there are penalties for any party who fails to protect Medicare’s interests, plaintiffs and defendants alike are concerned with ensuring that third party liens are satisfied at the time of settlement. However, practically speaking, the attorneys involved do not always know what liens exist, and must rely on the lay parties for that information. It is no surprise, then, that both attorneys and insurers have an interest in protecting themselves from incurring a penalty from CMS to the extent a third party claim exists of which they are unaware.

LEO 1885 examines the issue against the backdrop of the Virginia Rules of Professional Conduct, noting that a plaintiff’s attorney would be prohibited from agreeing to indemnify the defendant, as Rule 1.8(e) prohibits a lawyer from providing financial assistance to his client in connection with pending or contemplated litigation (with a few exceptions not applicable here). Also, such an indemnification agreement would violate ethics Rule 1.7(a), since it presents a potential conflict of interest between the lawyer and the client, under the idea that the settlement can only go forward if the indemnification clause is included (making plaintiff’s counsel personally responsible for any third party liens), the attorney may be less likely to settle the case despite the plaintiff’s wishes.

LEO 1885 also discusses the defendant’s attorney’s ethical obligations with regard to such an indemnification clause, and concludes that by insisting that the plaintiff’s attorney agree to this provision in the settlement agreement, the defense attorney is inducing the plaintiff’s attorney to act unethically, which is itself a violation of Rule 8.4(a).

The LEO only discusses the obligations of attorneys under the Virginia Rules of Professional Conduct. There is nothing to prevent a plaintiff (versus his counsel) from personally indemnifying a defense attorney or a carrier from liability for any outstanding third party claims.

Colleen Gentile authored this article and is a member of the firm’s Healthcare and Business and Professional Litigation groups. Her practice is focused primarily on medical malpractice defense, which includes the defense of hospitals, doctors, nurses, and other health care providers in professional liability cases

What do you think? Is letting non-parties gamble on the outcome of litigation an innovative way to fuel the expensive American justice system, or another sign of a system that has gotten too far from the concept of justice?

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This encouraging news certainly brightened my day as a practicing Virginia litigator: 

Virginia Lawyer’s Weekly has posted an article indicating movement to codify Virginia Rules of Evidence. 

Virginia has long considered codification of its rules of evidence, but previously, the proposed rules never made it past Virginia’s Supreme Court. As discussed in the Virginia Lawyer’s Weekly article, codified rules would make it far easier to argue objections to evidence in real time during a trial or plea in bar (link goes to a case explaining Virginia’s plea in bar). Plus, key evidentiary considerations, such as whether a piece of favorable evidence will be admissible and why, will rely more on codified rules and less on hours of expensive legal research to find just the right case, allowing parties more certainty and less expense as they evaluate cases set to go trial. 

This news definitely will give me something to look forward to in the 2012 legislative session of Virginia’s General Assembly.

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Amen to Ted Tjaden for writing this article about why “and/or” should never be used in legal writing. 

Although I know that “and/or” has its place – it certainly is economical – that place is not in well-crafted discovery requests. Too often I see it when the drafter of the document simply failed to really think about what he was saying and making a commitment. For some attorneys, use of “and/or” is nearly a reflex, born of the philosophy that “if ‘and’ is good, ‘and/or’ is better!” Yet, in nearly every sentence in which “and/or” appears, the sentence would be clearer and easier to read if the writer simply committed to using one or the other. In crafting discovery that is genuinely attempting to elicit a cogent response from the opposing party, clarity is vital. It helps the other party know exactly what the writer is asking for, and it will help the court find the request clear and reasonable if the other party is non-responsive in the answer.

Use of “and/or” also seems uncertain, as if the writer was afraid that if he asked for “any document or picture that supports the damages in this case” instead of “any document and/or picture that supports the damages” opposing counsel would clap her hands in glee, because she only had to produce the documents OR the pictures, not both, in response. Of course, this fear is utterly unfounded. The request for production that asks for “any document or picture” clearly also asks for the production of both, if available. Woe to any attorney that attempts to skirt the discovery rules by arguing otherwise.

Eliminating “and/or” eliminates the impression that the writer is lazy or uncertain. It shows that the writer really thought about what he wanted, rather than copying from a form book. It suggests confidence and precision. It is also easier to read, which should be the goal of most legal writing, particularly in discovery, when the objective of the request is to obtain a useful answer.

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As a lawyer representing homebuilders and general contractors, I am sometimes asked to assist them in responding to complaints filed against them by dissatisfied homeowners with the Department of Professional and Occupational Regulation (“DPOR”). For builders, these complaints can be stressful, time-consuming, expensive and potentially detrimental to their licenses. Should you face a complaint, you should keep a few principles in mind.
DPOR regards its mission as, among other things, protecting the health, safety and welfare of the public by licensing qualified businesses and enforcing standards of professional conduct. Part of DPOR’s job is to administer and investigate consumer complaints filed against businesses licensed by DPOR. The process begins when a consumer files a complaint. For our purposes, let’s assume the consumer is an individual who has contracted with a builder for a new home. Once DPOR receives the complaint, its first step is to determine whether it is authorized to process the complaint. Assuming DPOR has jurisdiction, it will notify the builder of the complaint and request a written response, normally within a short period of time. In my experience, DPOR is generally willing to extend the time for responding.
Once the builder has responded, DPOR will typically investigate further. Often, if the circumstances so justify, the DPOR investigator will interview the homeowner, builder and other relevant witnesses. Such witnesses may include subcontractors and building inspectors. Frequently, DPOR will request documents from the parties. It is important to keep in mind that the file compiled by the DPOR investigator will likely be subject to disclosure under the Freedom of Information Act. As a result, information which the parties share with the investigator will typically not enjoy any anonymity.
After its investigation, DPOR will decide whether or not a violation of a law or board regulation may have occurred. In the event that DPOR concludes that a violation did occur, the investigator will prepare a report of findings setting forth the facts in support of its conclusion that violations have occurred. If such findings are found, the next step involves the disciplinary process. Generally, DPOR will present the builder with a consent offer. The consent offer will usually include one or more forms of punishment. Disciplinary action can include a requirement that the builder undertake remedial education. A monetary fine may be imposed. In some circumstances, the builder’s license can be suspended or revoked.
A builder facing a consent offer has some choices. The builder can accept the offer and the punishment which it entails. A builder needs to be careful in doing so because such could be construed as an admission of guilt. If a civil lawsuit is later filed by the homeowner, such an admission could be a real disadvantage to the builder. Another option which the builder has is to propose a counter-offer. In doing so, the builder may want to suggest a lower monetary fine and state that it is not in any way admitting guilt or liability. The builder also has the option of rejecting the consent offer outright. If the builder does so, the matter will move on to the Board for a hearing.
If a builder has concerns during construction that the homeowner is not happy with the project and may be contemplating a lawsuit or DPOR complaint, it is important for the builder to properly document its files. Doing so could include taking extensive photographs of the construction, ensuring that pertinent e-mails are saved and writing letters to the homeowner. Keep in mind that a builder’s access to the homeowner’s property may be severely limited after the builder ends his involvement with the construction.
It is also important to be forthcoming and responsive to the DPOR investigator and his/her requests for information. Remember, the investigator is at the front line of making decisions on the complaint which could have serious implications for your business. Keep in mind also, because the investigator’s file will likely be discoverable in any civil lawsuit, that the builder’s statements are clearly thought out and well organized. What the builder says during the DPOR investigation could come back to haunt him during a later civil lawsuit.
DPOR has a helpful website which does a good job of explaining the complaint process. The site can be found a thttp://www.dpor.virginia.gov/dporweb/dpormainwelcome.cfm . Feel free to contact Henry Spalding should you have any questions about this article.

We’re pleased both for Chip’s results for our client and that he was noticed at the top professional organization for our work.

Jayne was recognized for, among other things, her work in the Metropolitan Richmond Women’s Bar Association (MRWBA) and Big Brothers Big Sisters of Central Virginia (BBBS).

In the MRWBA, Pemberton quickly rose through the ranks to the presidency this year. Under her leadership, MRWBA has adopted the Peter Paul Development Center in Church Hill as a public service project, raising money, sponsoring a family at Christmas, and organizing parties at Christmas and in the spring for the children, attended by MRWBA members.

At BBBS, Pemberton has been in lead positions for the Board during the hiring and installation of a new Executive Director. She has mentored one young lady through her senior year in high school and graduation from the BBBS program, and has started mentoring a second “little sister” in January of this year. In 2007, she was awarded the prestigious Big Sister of the Year Award for her years of service to BBBS. Recently, Jayne has been working to garner the support of BBBS by MRWBA, marrying two of her passions within and without the practice of law.

Pemberton joined Sands Anderson in 2005 and focuses her legal practice on defense of companies and individuals in insurance litigation, and on insurance coverage issues. She earned Bachelors and Masters of Arts degrees at Baylor University and her law degree at the University of Richmond School of Law.

Now in its third year, the Virginia Lawyers Media awards program recognizes the outstanding efforts of women in the commonwealth in all fields, including law, business, health care, education and the arts. The honors are given to individuals who are making notable contributions to their chosen professions, their communities and society at large, according to publisher Paul Fletcher. The entire class of 2011 recipients was covered in a special publication inserted in the May 9 edition of Virginia Lawyers Weekly.

Regardless of how carefully plaintiff’s counsel may attempt to disguise claims for severance in state law clothing, employers should remember that claims of entitlement to severance benefits by former employees under a plan established by the employer for the purpose of providing severance to employees are frequently ripe for dismissal as being preempted in their entirety by the Employee Retirement Income Security Act of 1974, 29 U.S. § 1001, et seq., (“ERISA”), as illustrated by a recent decision from the U. S. District Court Western District of Virginia.

In Woodruff v. Monumental Life Ins. Co., 2011 U.S. Dist. LEXIS 8250 (W.D. Va. 2011), a long time employee who retired from his job with an insurance company sued alleging that his former employer had withheld a severance package from him. The plaintiff filed suit in state court, making state law claims of breach of contract and quantum meruit. Monumental removed the case to federal court and moved to dismiss the action for failure to state a claim upon which relief can be granted. The District Court ruled that the plaintiff’s action was preempted by the ERISA, but granted plaintiff leave to file an Amended Complaint under that federal statute.

After plaintiff filed his Amended Complaint alleging violations of ERISA, a state statute, breach of contract and quantum meruit, the District Court again held that each of plaintiff’s state law claims seeking severance was preempted by ERISA and must be dismissed.

With respect to plaintiff’s allegations attempting to make a claim under ERISA, the District Court ruled that in his Amended Complaint plaintiff had still failed to adequately allege a right to recovery under an ERISA plan, citing plaintiff’s failure to allege that he was even covered by such a plan much less the terms of that ERISA plan. Since the plaintiff had pled only a conclusory allegation that he was entitled to severance, the District Court granted Monumental’s Motion to Dismiss and dismissed each of plaintiff’s claims without prejudice.

As we move into 2011, we thought it would be helpful to reflect on 2010 and highlight some of the litigation activity of the risk management attorneys at Sands Anderson. 

January

David Hearn saved the client the burden and expense of costly products liability litigation when he successfully argued a plea in bar after his client was added as a defendant after the statute of limitations had expired.
Chip Delano proved the old adage “cheaters never win” after successfully arguing that a woman was not entitled to her husband’s $200,000 life insurance policy when she canceled it before he died, but sued the insurance company for reinstatement after his death.
Will Watkins obtained a defense verdict in a construction and products liability case before a jury in Covington, Virginia.
Jayne Pemberton had a significant victory in a recent premises liability case in which she won a defense verdict after a one day trial.
February

Chip Delano wrote $162,000 brief when he a won another significant victory against claimants who made material misrepresentations when applying for a life insurance policy. Upon receiving Chip’s brief in support of his motion for summary judgment to dismiss the family’s claim against the insurance company, the claimants dismissed their $162,000 claim with prejudice rather than attempt to develop an opposition to Chip’s brief.
David Hearn won a defense verdict in a trucking case tried in the Roanoke division of the Western District Federal Court, sparing his client from the Plaintiff’s claim of $750,000 in damages with $100,000 in medical expenses.
Jayne Pemberton settled two multi-million dollar cases days just weeks before the trials for a small fraction of the amount sued for, which was a significant savings to her client.

March

Terrence Graves and Drew Wilson successfully defended a high-value brain injury case in which the plaintiff originally sued for $68 million in compensatory damages after a fall down a outside flight of stairs, allegedly because of a flyer left on the landing by the management of the apartment complex. After a strong defense on liability and damages, including assertions that her deficits were due to other factors, such as age and pre-existing health problems, they were able to settle the case for just .02% of the initial ad damnum.

April-May

Chip Delano won a significant victory for his client recently in the Eastern District of Virginia when the court accepted his argument for summary judgment against a plaintiff who claimed permanent disability benefits that should have been covered by his wife’s insurance policy were denied. First, Chip successfully convinced the judge that the plan changed the standard of review that should be used by the court and then proved that the insured was not completely paralyzed in his leg as the plan required to pay the benefit.
Terrence Graves and Drew Wilson won a defense verdict when defending a tractor-trailer driver sued by a driver of a car and his wife after the tractor-trailer was struck by a car driven by a driver who fell asleep. The sleepy driver’s car caused the tractor-trailer to swerve out of control, causing the driver to hit his head and lose consciousness. Thus, when the tractor-trailer hit the plaintiffs’ vehicle, it was not through any negligence on the part of the trucker.
June

David Hearn won a significant victory by settling a maritime products liability case pending in federal court for only defense costs. David torpedoed the plaintiff’s case by finding a “smoking gun” document that clearly fixed liability for the plaintiff’s sunken boat on a third party.
Justin Ward’srecent win was written up in Virginia Lawyers Weekly when he successfully argued in Stanley, Adm’r v. Star Transport Inc.. that Iqbal applies to state law claims filed in federal cases, which lead to the court’s dismissal of the plaintiff’s claim for reckless acts, negligent hiring and supervision, and punitive damages. The opinion agreeing with Justin’s argument was featured in the statewide publication in the Daily Alert for May 28, 2010.
Doug Winegardner won a General District Court case recently when the plaintiff filed suit to recover defense costs in an underlying suit brought in federal court. Doug won at trial after proving that the damages claimed did not meet the policy definitions of an “advertising injury,” when the basis for the plaintiff’s claim was a breach of warranty action arising out of statements made in advertising about a residential subdivision.

July

Erin McNeill successfully presented a Special Plea in Bar on the issue of respondeat superior to Judge C. N. Jenkins of the Richmond Circuit Court July 19, 2010. The claims were for intentional torts allegedly made by private security forces. Erin represented the property owner and property management company and argued that only the security company had respondeat superior liability for the acts of the guards. We presented two witnesses in support, after convincing the judge that he could sit as fact-finder on a plea in bar and that the parties were not bound only to the pleadings. The Court sustained the Plea and dismissed both of Sands Anderson’s clients from the case with prejudice.
Drew Wilson was vindicated recently, by the apprehension of one of Chip Delano client’s insureds in a case that is unusual even by Risk Management standards. Drew successfully argued before a court in North Carolina that his client, a life insurance company, should not be obligated to pay on the policy, although the insured had been missing for over the seven year period required to create a presumption of death. Drew was able to overcome the presumption by showing that the insured was alive, but in hiding as a fugitive from justice – the insured was even featured on America’s Most Wanted! When the insured was apprehended in Florida, it was a satisfying resolution to the exceptional case.

August

Chip Delano held on to an earlier win last month after the trial court in the Eastern District court of Alexandria upheld their grant of summary judgment in favor of Chip’s client. The original Complaint was filed in 2003 and the plaintiff has appealed it to the Fourth Circuit twice – obtaining a remand each time. Chip’s continued zealous advocacy cemented his earlier victory and prevented the plaintiff from successfully overturning the grant of summary judgment.

September

Mike Charnoff and Doug Winegardner won a declaratory judgment action in the U.S. District Court in Lynchburg this month when the court declared after a one day trial that Doug’s client, an insurance company, was not liable for a claim brought by a landowner against the client’s insured land developer. Doug won on the argument that the developer was aware of the landowner’s pollution allegation before the effective date on his insurance policy.
Once again Justin Ward was featured in the Virginia Lawyers Weekly as the Top Opinion in their daily e-newsletter for his big win in getting a wrongful death claim dismissed that was predicated on a claim of negligent hiring. The plaintiff sued the tractor-trailer driver’s employer, claiming that they were liable for negligent hiring because the driver was fired from a previous employer for a safety violation and suspended driver’s license and because he had a prior speeding violation. The U.S. District Court in Abingdon disagreed and dismissed the claim.

In the suit, the mother alleges that the school principal, the two assistant principals, the school counselor, and the school resource officer failed their duty to protect her son while he was in their custody or under their supervision at Grafton High. The school resource officer was dismissed on demurrer, with the court holding that a school resource officer serves a peacekeeping function at the school, not one intended to supervise the students. The attorney for the defendants argued that school administrators did not have a duty to prevent a suicide that occurred at home, after the child left their custody. There was also a question whether the school administrators could have foreseen the student’s suicide based on the information available to them. The court held that the plaintiff pled enough for the case to move forward past the initial pleadings, to determine what the administrators knew about the bullying suffered by the student while he was in their care and what they could have done or should have done to protect him.

The theory of the case is not as novel as it may sound at first. The U.S. Supreme Court has dealt with a related issue in the case Davis v. Monroe County Board of Education, 526 U.S. 629 (1999). In Davis a mother brought a claim against the school board for not preventing the harassment of her daughter by a male student. She based her claim on Title IX of the Education Amendments of 1972, which guarantees equal access to educational benefits by students, regardless of the sex of the student. Because the male student sexually harassed the plaintiff’s daughter, the Court held that a school may be liable if a school is deliberately indifferent to student-on-student harassment that is “so severe, pervasive, and objectively offensive that it effectively bars the victim’s access to an educational opportunity or benefit.”

Although Davis imposes a duty on school administrators to stop gender-based sexual harassment bullying, Title IX does not offer protection based on sexual orientation or other traits that might make a student the target of bullying – anything from socioeconomic status to red hair can single out a student for pervasive harassment that bars them from educational access without triggering Title IX’s protections. If Alise Williams prevails in her wrongful death suit against Grafton High School administrators, she may create a common law protection similar to Title IX’s protection against sexual harassment.

As a defense attorney, I wonder if this type of liability really will make our schools safer for male victims of bullying. (Interestingly, the recently publicized deaths of victims of bullying due to suicide were all male.) It may make school officials less likely to dismiss a student’s complaint with a shrug and a “boys will be boys” mentality. On the other hand, how much power to school administrators really have to stop bullies from harassment that extends to facebook messages, twitter posts, and bus stop assaults? When a student is so depressed from bullying that he takes his own life, that seems to be a problem that is better addressed through parental involvement to seek mental health counseling for their child to help them withstand the psychological effects of bullying and live until their son can make his own “happy ending” like the one shared by the couple in the “It Gets Better” video, rather than school administrators who can at best offer physical security for students in their care, but not the self-confidence and counseling needed to survive the psychological effects of bullying. At the same time, if school administrators are aware of bullying but don’t provide that sense of physical safety and don’t partner with parents to alert them that their child may need counseling, maybe they should have some liability for their inaction.

For example, the recent suicide of Rutger’s student Tyler Clementi seemed to have been triggered by his roommate posting messages and video links to a Twitter feed revealing the teenager was gay. That kind of bullying is far beyond the ability of school administrators to regulate or control. Although Clementi and his roommate were college students and the wrongful death case involves the suicide of a persecuted high school student, Clementi’s death highlights how hard it is for parents and school officials to protect kids from cyber-bullying, which can be just as psychologically damaging as physical threats.

I would be interested to hear your thoughts on how effective the civil litigation system is to prevent bullying. Should we turn up the heat on school administrators to protect younger students from bullying by imposing civil liability for suicides that result from a student’s harassment at school or is this the wrong vehicle for finding ways to increase protections to students harassed by other students in ways that are outside the protections of Title IX? Do school officials have a duty to keep kids physically safe from bullies, but leave kids like Clementi unprotected from cyber bullies? These are questions worth asking as the legal system works to address the growing problem of bullying, the pervasiveness of cyberspace that allows bullies to reach kids even at home, and the devastating effects.

On June 10, 2010, the Supreme Court of Virginia issued two rulings that could have important impacts on Risk Management clients.

First, in Walton v. Mid-Atlantic Spine Specialists, PC, Record No. 091009, the Court issued an important ruling on safe-guarding documents that should be privileged from disclosure to an opposing party under the “attorney work-product” and “attorney-client” privileges. In this case, the defendant physician in a malpractice case drafted a letter to his lawyer, intended to be privileged, which contained certain after-the-fact opinions and admissions about his care of the plaintiff. He claimed that he kept his “litigation documents” separate from his client’s medical records, but somehow the letter was inadvertently copied and provided to the plaintiff’s lawyer, as part of a larger production of medical records that were being produced in response to a subpoena. The copy service used alleged that the letter was included in the medical records that they were instructed to copy and provide to counsel, while the doctor alleged that the copy service must have accidentally copied his “litigation” folder.

When defense counsel discovered that the document had been produced, it sought a protective order, asserting that the document was privileged, and that the privilege was not “waived” by the disclosure since the disclosure was accidental and not purposeful.

The Virginia Supreme Court held that there was a legal distinction between disclosures of privileged documents that were “involuntary” and those that were “inadvertent” and that an involuntary disclosure (one occurring due to fraud or theft) rarely result in a waiver of the privilege. However, where a disclosure is “inadvertent”, the Court adopted a five-part test to determine whether the disclosure “sticks” and the plaintiff gets to use the information. The court looks at (1) the reasonableness of precautions taken to prevent disclosures, (2) the time taken to rectify the error, (3) the scope of the discovery, (4) the extent of the disclosure, and (5) whether the party asserting the privilege has used the unavailability of the document to mislead the other side.

Applying these factors, the Court held that the doctor failed to take reasonable measures to protect the letter from disclosure, specifically finding that the letter had to have been contained in the overall file of “medical records” instead of in a separate “litigation” folder as alleged, and that when notified about the plaintiff’s receipt of the letter, failed to take reasonably speedy efforts to have it returned and protected.

The lessons from this case are clear….if you have privileged documents that you want to keep privileged, you have to protect them. This should include clearly and effectively segregating the privileged documents from those that are “fair game” and should also include marking them conspicuously which language such as “Privileged—Do Not Disclose”. Failure to take such precautions could result in “inadvertent” disclosures which harm your case.

Secondly, in Evans v. Evans, Record No. 091469, the Supreme Court of Virginia examined whether the “seat belt laws” passed several years ago by the General Assembly, and which included a provision that evidence of a failure to use a seat belt system/safety restraint system could result in a ticket, but could not be used as evidence of negligence in a tort case, prevented a mother from suing a child’s father for failing to properly secure their infant daughter in his pickup truck, under Virginia common law negligence principles, without reference to the “seat belt laws” in the suit or at trial.

Va. Code § 46.2-1095(C) mandated the use of seat belts and seat restraints, but also held that violations of the law “shall not constitute negligence” or be admissible in civil court in any way. In the mother’s lawsuit, she did not cite to the statute, nor did she assert any claim that violating the statute constituted negligence as a matter of law. Instead, she asserted that the father was negligent for failing to secure his infant daughter by placing her in a portable foam seat on the floorboards of his 1972 pickup truck, which she further alleged caused her to suffer serious injuries when the father then got into an accident.

The Court allowed this common law negligence claim to proceed against the father despite the prohibition contained in §46.2-1095(C), noting that the plain language of the law prevented any lawsuit alleging a violation as negligence or negligence per se, and forbade any evidence of the failure to use proper safety restraints in court. Since this lawsuit did not so allege, the Court allowed the mother’s lawsuit to go forward, providing that the trial court did not allow evidence of the failure to use a proper safety restraint into evidence.

The Court sent the case back for trial, but also ruled that the trial court must “be mindful” of Virginia law that a four-year old child cannot legally be held to be “contributorily negligent”, that a parent’s negligence cannot be imputed onto the child, and that a four-year old child was exempt from the normal rule that requires all plaintiff’s to take reasonable actions to mitigate injuries and damages.

In short, creative pleading allowed this case to go forward.

On June 7, 2010, in Krupski v. Costa Crociere S.p.A., No. 09-337, slip op. at 1 (U.S. June 7, 2010), the Supreme Court of the United States held that “relation back under Rule 15(c)(1)(C) depends on what the party knew or should have known, not on the amending party’s knowledge or its timeliness in seeking to amend the pleading.” Federal Rule of Civil Procedure 15(c) governs the circumstances under which an amendment is considered to take effect on the original date of filing, and not on the date the amendment is actually made. Specifically, Rule 15(c)(1)(C) governs amendments that change the party being sued or the naming of the party being sued. State rules and statutes concerning amendments to correct misnomer or misjoinder often contain language similar to Rule 15(c). Virginia Code section 8.01-6, for example, contains language identical to the Federal Rule. The Krupski decision, therefore, may have far-reaching implications for state civil procedure as well.

In Krupski, the petitioner, Wanda Krupski, suffered a nautical misadventure—she tripped over a cable while aboard a cruise ship and fractured her femur. Krupski mistakenly filed suit against Costa Cruise Lines, the sales and marketing agent for the ship’s owner and proper defendant, Costa Crociere. By the time Krupski amended her Complaint, the limitations period for her claim had run. Krupski sought to invoke Rule 15(c); counsel for Costa Crociere argued that the amended Complaint was not brought within the limitations period and could not relate back under Rule 15(c).

The District Court for the Southern District of Florida and the Court of Appeals for the Eleventh Circuit agreed. Rule 15(c) requires, in part, that the plaintiff show that the newly-named defendant “knew or should have known that the action would have been brought against it, but for a mistake concerning the proper party’s identity.” FED. R. CIV. P. 15(c)(1)(C)(ii). The courts adopted a narrow interpretation of “mistake” under this Rule. They reasoned that Krupski knew or should have known to file suit against Costa Crociere because her ticket identified Costa Crociere as the ship’s owner. Therefore, they treated her misdirected lawsuit as an affirmative decision to sue the wrong entity—not as a mistake concerning the proper party’s identity. The courts further reasoned that Krupski waited too long to amend her complaint after she knew of Costa Crociere’s existence.

On appeal, the Supreme Court of the United States reversed, holding that the lower courts had misapplied Rule 15(c) and that Costa Crociere “should have known that Krupski’s failure to name it as a defendant in her original complaint was due to a mistake concerning the proper party’s identity.” Krupski, slip op. at 18. The Court explained that Rule 15(c) does not focus on the rationality of the plaintiff’s mistake—just that the plaintiff made a mistake concerning the proper party. Whether Krupski knew or should have known that Costa Crociere existed is irrelevant for the purposes of this determination. Instead, the Rule is concerned with whether the prospective defendant knew or should have known that it was an intended party to the lawsuit. The Court determined that Costa Crociere should have been on notice for several reasons:

(a) Costa Cruise Lines and Costa Crociere are related corporate entities with similar corporate names (“crociere” is Italian for “cruises”);
(b) Krupski’s Complaint described Costa Crociere’s activities, but it named Costa Cruise Lines; and
(c) Advertisements on the ticket mentioned the carrier as “Costa Cruises” without clarifying whether this referred to Costa Cruise Lines or Costa Crociere.

Furthermore, the Court observed that Costa Cruise Lines made no attempt to correct Krupski’s mistake until after the limitations period had expired. The Court seemed particularly concerned that Costa Crociere would profit from an obvious mistake that its subsidiary only helped to perpetuate.

The Court also clarified that the speed with which a plaintiff moves to amend her Complaint has no bearing on whether the amendment relates back. Although Rule 15(c) contains a number of requirements, haste is not one of them.
The Krupski opinion will substantially affect how many federal courts approach Rule 15(c). Krupski indicates the Supreme Court’s willingness to impute notice to a related, similarly-named corporation. A corporation, therefore, will not be in the clear when a plaintiff has mistakenly filed suit against one of the corporation’s subsidiaries—even after the limitations period has expired.

Not only does this opinion expand the protections under Rule 15(c), but it may have implications under state law. In Virginia, for example, the standard for amendments that correct a misnomer includes language identical to Federal Rule 15(c). See VA. CODE. ANN. § 8.01-6(iv) (“An amendment changing the party against whom a claim is asserted . . . relates back to the date of the original pleading if . . . that party knew or should have known that but for a mistake concerning the identity of the proper party, the action would have been brought against that party.”) When state courts confront the same question under often-identical state rules and statutes, the Supreme Court’s reasoning will be highly applicable and should be highly persuasive. Thus, Krupski will have extensive implications for federal and state civil procedure.

A recent ruling only enforces Virginia’s commitment to impeachment by prior felony conviction when Judge Roush of the Fairfax County Circuit Court held in Sulton v. FedEx Ground Package System, Inc. that a restoration of civil rights does not include a “right” to testify without being impeached with the fact of a former felony conviction.

The Virginia Lawyers Weekly, a periodical targeted to Virginia lawyers and legal professionals, featured the holding in a recent article about the opinion and its implications. The article quoted Sands Anderson attorney Robert “Chip” Delano, who represented the successful defendant in the case. Read the entire story, by Peter Vieth, on Virginia Lawyers Weekly’s website here: http://valawyersweekly.com/blog/2010/06/24/rights-restored-man-still-can-be-impeached/

Provided by Kelly A. Davidson (Practice Group Support)

On January 11^th, Judge Shira A. Scheindlin entered an eighty-eight page decision in The Pension Committee of the University of Montreal Pension Plan, et al. v. Banc of America Securities, LLC, et al., 2010 U.S. Dist. LEXIS 1839 (S.D.N.Y. Jan. 11, 2010), subtitled “Zubulake Revisited: Six Years Later,” addressing the preservation, collection, litigation holds and sanctions relating to ediscovery. The genesis of the decision stems from a series of prior decisions in Zubulake v. UBS Warburg, referred to as Zubulake I-V. The Zubulake decisions gave rise to eventual sweeping changes in the Federal Rules of Civil Procedure regarding electronically stored information (“ESI”) and ediscovery in December of 2006 and many state court rules, including the Rules of the Supreme Court of Virginia as of January 1, 2009. See, e.g., Rule 4.1.

What is offered here are highlights of some of Judge Scheindlin’s comments in this decision. This is neither offered as a complete analysis of the opinion, nor is it postured to be a legal analysis of the opinion with respect to the rules of discovery or other case law.

Continuum of Fault

In the court’s opinion, Judge Scheindlin addresses the definitions of negligence, gross negligence, and willfulness in the discovery context. She offers a continuum of fault particularly as it relates to the adequacy of the remedy – from additional/further discovery to dismissal or default judgment. While Judge Scheindlin states that the activities described are not meant to be a complete list, what follows is a sampling of conduct she does address, many of which are triggered by the duty to preserve.

Willful or Grossly Negligent Actions/Activities:

• “Failure to collect records… from key players”
• “Intentional destruction of relevant records, either paper or electronic”
• “Destruction of email or certain backup tapes”

Grossly Negligent Actions/Activities:

• “Failure to issue a written litigation hold”
• Failure to collect from former, as well as current, employees when in possession, care, and control of the party

Negligent or Grossly Negligent Actions/Activities:

• Failure to cease the deletion of email or other routine destruction of business records
• Failure to complete a comprehensive search and to supervise/monitor the search for evidence

Negligent Actions/Activities:

• Failure to collect from all employees, in addition to the key employees identified, even “some of whom may have only have had a passing encounter with the issues in the litigation”
• “Failure to assess the accuracy and validity of selected search terms”

Lessons to be Learned

While many lessons and procedure modifications can be taken from this opinion, three important topics concern: (1) litigation hold standards (including triggers of the duty to preserve), (2) the preparation of witnesses, and (3) the retention of backup tapes.

Litigation Holds (Including Triggers and Collection)

Litigation holds are the primary tool in the preservation of evidence. This consists of three types of litigation hold letters; letters from a company representative (quite often, in-house counsel) to the employees of a company, letters from outside counsel to the client, and letters from a party to the opposing party. Judge Scheindlin addresses litigation holds by a party, setting forth the standard that a duty to preserve starts when a party “reasonably anticipates litigation.” When discussing first two types of hold letters, language should address the following:

• Notification “to preserve all relevant records – both paper and electronic”
• Instruction not to destroy relevant information
• Information on the collection process
• Timing of the hold
• Stopping the routine destruction of potentially relevant information

Triggers to the litigation hold process differ on a case by case basis. For the plaintiff, it is quite often the case that the duty to preserve starts prior to the filing of a litigation as “plaintiffs control the timing of the litigation.” For the defense, it is often the case that the duty to preserve starts no later than the moment that the defendant is served, potentially sooner. It is imperative that litigation holds are written and are sent to all personal that may have a role in the litigation, every those that may have a cursory role or a support function to personnel involved. Litigation hold letteres should also have some instruction as to the preservation of the electronically stored information and a direction to avoid trying to perform a self collection.

Any discussion of a litigation hold should also be backed by a collection process, addressed in part in the Continuum of Fault section above. Many times, it is during the collection process that relevant materials and evidence can be missed, damaged, or modified resulting in spoliation. Collection of evidence should be performed by a person that is trained to do so, and that person should be prepared to testify as to the means and methods. Do not fall victim to the adage that there is “no harm in trying.” Spoliation of electronic evidence is prone to occur (even if innocently) when performed by someone not knowledgeable about, for example, metadata, how to properly mine for data and how to properly process said materials to conform with the applicable discovery rules, including the form of production.

Witness Preparation

After the collection, knowledge of the collection by a witnesses who is able to discuss the collection process is important to the case when it pertains to the burden of proof of proper preservation, collection, and production of evidence, as Judge Scheindlin discusses, as well as authentication as witnessed by myself in practice. A witness should be prepared to testify as to:

• from where files were collected,
• how the files were searched to find relevant information, including the key terms used and the tools or software employed to conduct the search,
• who conducted the search,
• what the collecting party was told about the search and what was to be (and not to be) searched and excluded, and
• what supervision was in place to monitor the search.

The more complete this information, the more empowered a witness will be during a deposition or at trial and the better prepared a party will be to address issues of spoliation.

Backup Tapes (and Other Forms of Backups)

Backups, including tapes, have been a long standing issue of contention between parties with regard to their preservation and the costs associated with that preservation and the restoration of the data contained. Backups were initially developed and are still seen by many today as disaster recovery and not as a mode of preservation. Preservation and collection from backups, while potentially costly, may be crucial to avoid spoliation sanctions. This is particularly the case when retention policies routinely overwrite or destroy backups and when a backup is the only source for evidence in a case.

Conclusion

It is important to protect interests in matters of spoliation of evidence and the associated sanctions. It is crucial for client and attorney to work in concert with each other during the entire discovery process. Cases have been won and lost on matters of electronic information. Clients need to provide all the information possible to their attorneys and attorneys have to work closely with clients so that they understand the process and need for the collection of electronic information.

HB 93 creates what is frequently referred to as a “dump and run” provision in the UIM Statute to address these concerns. It allows an underlying liability carrier to be relieved of the costs of defending its insured owner or operator of a motor vehicle in a personal injury and/or property damage action. Under the amended UIM Statute, a liability carrier may make an irrevocable offer in writing to pay the limits of its insurance policy to the carrier providing underinsured motorist (hereinafter “UIM”) coverage. Once coverage is tendered in writing by the liability carrier, then the UIM carrier has 60 days to assume the cost of the defense.

Once the defense is tendered, the liability carrier still retains its duty to defend the action. As a result, it appears that the attorney retained by the liability carrier will continue as counsel in the case. It also appears that logistically, the liability carrier continues to pay these costs directly, but is then reimbursed by the UIM carrier. If there are multiple UIM policies available, then the cost of the defense will be assumed in the same order of priority as previously established by the UIM statute.

HB 93 does clearly establish that in the event a case is dismissed or a verdict in an amount equal or less than the tendered liability coverage, then the offer will not apply. One issue that caused concern to the Virginia Association of Defense Attorneys is that HB 93 is silent as to the issue of subrogation. An attorney for an insured faced with suit in excess of policy limits holds an ethical obligation to make sure that the insured is personally protected. That frequently means that a defense attorney will not recommend that policy limits be tendered without an agreement from the UIM carrier to waive its subrogation rights against the insured. With its failure to address this very important issue, HB 93 may have little effect on defense attorneys’ recommendations to tender policy limits in excess coverage cases and may not adequately address the concern that UIM carriers sometimes force protracted litigation.

HB 93 is scheduled to go into effect on July 1, 2010. If you would like to discuss this opinion further, please feel free to contact Jayne Pemberton or any of the other members of the Sands Anderson Risk Management team.