Philadelphia Employment Lawyers: Non-Solicitation Verdict Upheld

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Recently, a Pennsylvania appellate court upheld a $6.9 million verdict for an insurance brokerage firm that sued several former employees who violated their non-solicitation contracts. The employees allegedly tried to lure clients to a competing agency.

Things began when two executives at Balmer began considering launching a new Philadelphia office for competing firm Frank Crystal & Co. (“FCC”). Just one month after these discussions began, the Philadelphia FCC branch opened with three Balmer employees at the helm. The Balmer employees purportedly worked on transitioning to their new positions while on agency phones, computers, and time. One employee allegedly compiled a list of Balmer clients and other trade secrets. Ultimately, the Philadelphia branch of FCC solicited at least twenty-four Balmer clients. One of these clients had been with Balmer for over 25 years and was one of the agency’s biggest.

Balmer sued both FCC and the former employees, seeking damages for breach of fiduciary duty, tortious interference, unfair competition, conspiracy, and other violations. A Chester County judge awarded Balmer $2.4 million in compensatory damages and $4.5 million in punitive damages.

An Undeniable Breach in Contract

The defendants appealed to the Superior Court, urging that the punitive damages be struck, as there was no evidence of outrageous conduct. The court did not agree, finding ample evidence to support the punitive damages. Specifically, the court noted that FCC knew about the Balmer executives’ non-solicitation contracts, yet courted them anyway. Furthermore, the employees had provided FCC with privileged, protected information about Balmer clients.

The court relied on an earlier case wherein a radio station manager solicited members of his sales staff to join him in his move to a competing station. They also persuaded an advertising client to follow them to their new employer. Even though the two cases are distinguishable in that one deals with a covenant not to compete, and the other deals with non-solicitation contracts, the conduct was similar in both.

In ruling against FCC, the court found that when a company hires the entire marketing and sales staff from one agency, the sole purpose is clearly to induce clients of that agency to keep their accounts with with the sales force that is switching agencies. FCC Philadelphia earned approximately $300,000 its first year, all from Balmer Agency clients. The court upheld the punitive damage award.

Philadelphia Employment Lawyers at Sidkoff, Pincus & Green Counsel on Non-Solicitation Contracts, Non-Compete Agreements

Whether you are trying to craft a solid employment contract, or whether you need an experienced, aggressive team of litigators to handle a claim of breach of contract, the highly regarded Philadelphia employment lawyers at Sidkoff, Pincus & Green are prepared. We take pride in developing successful relationships with our clients. Contact us online or call our offices at 215-574-0600 to speak with a Philadelphia business lawyer.

South Jersey Employment Lawyers: Refusing Flu Shot Results in Lawsuit

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The Equal Employment Opportunity Commission (EEOC) recently brought a lawsuit against a hospital in Erie, Pennsylvania for religious discrimination after it fired six employees based on their flu shot refusal due to religious beliefs.

In this case, the EEOC claims some employees were granted religious or medical exemptions from the flu shot, but that six employees were denied a religious exemption from the shot despite their requests. Nowadays, it is commonplace for healthcare facilities to mandate that all employees obtain a flu shot to minimize the spread of the flu in medical facilities.

Under Title VII of the Civil Rights Act of 1964, employees cannot be discriminated against based on a “sincerely held” religious belief, and the religion does not necessarily have to be a widely recognized or organized one. Under the law, the belief must only be “sincerely held” by the individual.

In this instance, the employees claimed that they belonged to a variety of Christian faiths, such as Russian Orthodox, Methodist, Independent Fundamentalist Baptist, and Christian Mysticism. The hospital’s main defense is that the employees did not provide adequate proof regarding their religious beliefs. The hospital’s policy requires certification by a clergy member regarding the religion prior to approving an exemption.

Religious Discrimination is Not Uncommon

The EEOC has brought other claims throughout the country when employees were wrongfully terminated over religious refusals to the flu vaccines in a healthcare setting. For example, the EEOC brought claims when employees have filed for exemptions after what it called “an arbitrary deadline” and also when an employee allegedly could not be understood when she wore a mask over her mouth in lieu of getting the flu shot.

In these types of religious discrimination cases, the employee must show a sincerely held belief and a religious reason as to why they refuse the flu shot. Additionally, the employees will need to demonstrate that they requested an accommodation or exemption from the flu shot prior to the discriminatory action or termination. The employee has to show that there is no undue hardship on the employer when it grants an accommodation, or in this case, an exemption from its requirement that all employees obtain seasonal flu shots each year.

South Jersey Employment Lawyers at Sidkoff, Pincus & Green, P.C. Represent Employees in Wrongful Termination Suits

If you or someone you know was discriminated against at work as a result of religious beliefs, or wrongfully terminated, call the South Jersey employment lawyers at Sidkoff, Pincus & Green, P.C. today at 215-574-0600 or contact us online.

Philadelphia Employment Lawyers: Non-Solicitation Award

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Superior Court of Pennsylvania Upholds Non-Solicitation Agreement, Awards $6.9 Million in Damages 

On October 7, 2016 the Superior Court of Pennsylvania handed down a ruling upholding the legality of non-solicitation agreements and awarded millions of dollars in damages. In B.G. Balmer & Co. Inc. v. Frank Crystal & Company Inc., et al, 2016 PA Super 202 (Pa. Super. 2016). Plaintiff Balmer sued to former employees as well as their new employer, Frank Crystal. The former employees began planning to work for Frank Crystal six months prior to leaving Balmer. Although they had signed non-solicitation agreements with Balmer, the defendant employees worked with a recruiter during this time and gave up valuable information about Balmer, such as trade secrets and client lists. During their first year at Frank Crystal, the defendant employees generated revenue solely on former Balmer clients, and managed to bring Balmer’s largest client over to Frank Crystal. As a result of the defendant employees’ actions, Balmer lost its client base and had to be sold.

Balmer sued the former employees and Frank Crystal, alleging violation of their non-solicitation agreements, breach of fiduciary duty, tortious interference with contractual relations, unfair competition and other claims. The trial court ruled in Balmer’s favor for a majority of the claims, assessing $2.4 million in compensatory damages and $4.5 million in punitive damages. Defendants appealed the award of punitive damages, but the Pennsylvania Superior Court affirmed the lower court’s ruling and found their conduct egregious enough to warrant a large award.

For more information, call the Philadelphia employment lawyers at Sidkoff, Pinus & Green, P.C. today at 215-574-0600 or contact us online.

Philadelphia Employment Lawyers | Uber Minimum Wage Complaint

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EDPA Denies Uber’s Motion to Dismiss Complaint for Failure to Pay Minimum Wage

On October 7, 2016, Judge Michael Baylson of the Eastern District of Pennsylvania denied Defendant Uber’s Motion to Dismiss a Complaint filed by Uber drivers suing Uber over its failure to pay minimum wage. Plaintiffs brought the Complaint on behalf of all Philadelphia UberBlack drivers. Razak v. Uber Techs., Inc., No. 16-573, 2016 U.S. Dist. LEXIS 139668 (E.D. Pa. Oct. 7, 2016)

The Court agreed with Plaintiffs that they were misidentified by Uber as independent contractors.  The Court ruled in favor of Plaintiffs by classifying them as employees under the FLSA, subjecting them to the Federal Minimum Wage standards.

Plaintiffs allege that Uber failed to pay them the minimum wage of $7.25 per hour, as required by the FLSA. In response, Uber claimed that Plaintiffs’ Complaint was insufficient because they failed to identify their pay rates and waged earned in a work week. Judge Baylson responded in his opinion that under the FLSA the employers are supposed to keep records of the work week information for employees. Judge Baylson further explained that while this was a close case because Plaintiffs did not specifically provide weeks where their wage fell below the Federal minimum wage, there was enough evidence to provide a reasonable inference to the court that Plaintiffs were not paid minimum wage. Specifically mentioned was the fact that Uber automatically deducts certain expenses each week regardless if the driver earned enough money to cover these expenses. Therefore, Uber’s Motion to Dismiss was denied and further proceedings will commence.

For more information, call the Philadelphia employment lawyers at Sidkoff, Pinus & Green, P.C. today at 215-574-0600 or contact us online.

Philadelphia Trial Lawyers: Judge Halts Rideshare Services

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On October 6, 2016, Judge Lisa Carpenter of the Philadelphia County Court of Common Pleas granted a preliminary injunction requiring that rideshare services such as Uber and Lyft cease operations in Philadelphia. Judge Carpenter ruled that these services, known as transportation network companies, (“TNCs”), violate the Americans with Disabilities Act and Philadelphia’s Fair Practices Ordinance.

The original Complaint was filed by a number of plaintiffs, including Rob Blount, the head of the Taxi Workers Alliance. The Complaint alleged that the companies discriminate against disabled riders because there are no requirements to ensure vehicles can accommodate wheelchairs or protections against refusing to allow service animals, as well as no protection against unfair pricing. In September, Blount amended the Complaint, alleging the Philadelphia Parking Authority violated the equal protection clause of the Constitution by not subjecting TNCs to the same “limitations, assessments, vehicle inspections, or driver requirements.”

If the TNCs violate the injunction, Uber and Lyft could be held in contempt of court.

For more information, call the Philadelphia business lawyers at Sidkoff, Pinus & Green, P.C. today at 215-574-0600 or contact us online.

Philadelphia Business Lawyers: Qualified Immunity

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Teacher Denied Qualified Immunity After Allowing Child to Leave School With Stranger

A Philadelphia kindergarten teacher, Reginald Littlejohn, was denied qualified immunity in an action alleging that he violated the Fourteenth Amendment rights of a student. Littlejohn allowed the child to leave with a stranger and the stranger then sexually assaulted the child. The stranger was later identified as Christina Regusters. Littlejohn asked for Regusters’ identification as per district policy, however, no ID was produced, and Littlejohn allowed the child to leave with Regusters. Regusters was subsequently convicted and sentenced to 40 years to life for kidnapping and sexual assault. The parents of the child filed a civil suit against Littlejohn in his individual capacity. They did this under the state created danger theory exception to the Fourteenth Amendment’s general rule that the Due Process Clause imposes no liability on states to protect citizens from harm. The parents prevailed and Littlejohn appealed.

Judge Fuentes of the Third Circuit upheld the lower court’s decision that Littlejohn could be held liable to the student. Fuentes went on to explain that while qualified immunity is important for public officials, like teachers, to be shielded from civil cases, there are exceptions to this rule. Fuentes stated in his opinion, “Exposing a child to an obvious danger is the quintessential example of when qualified immunity should not shield a public official from suit” L.R. v. Sch. Dist. of Phila., No. 14-4640, 2016 U.S. App., 89 (3d Cir. 2016).

For more information, call the Philadelphia business lawyers at Sidkoff, Pinus & Green, P.C. today at 215-574-0600 or contact us online.

Philadelphia Business Lawyers: Enforceability of Fee Agreement Via Email

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Recently, a Pennsylvania Superior Court ruled in a business litigation case where a contingent fee agreement, which was set forth in an email between an attorney and client, was enforceable against the client even though the client did not sign it.

In that case, the client owed approximately $40,000 to his attorney under that contingent fee agreement. The Court found that client should be responsible for about $39,000 of it. The main takeaway in that case has major impacts on how attorneys or other businesspeople can collect their fees. The fee agreement between attorney and client was enforceable since it appeared in an email between the parties and no signature by the parties was necessary. In that case, it may also be important to note that the email that contained the agreement requested a $32,000 upfront fee which the client promptly paid.

Emails Constitute as “In Writing”

The client attempted to argue that the fee agreement was not enforceable since the Pennsylvania Rules of Professional Conduct (RPCs) for attorneys requires that contingent fee agreements must be in writing. The court found that the client’s argument failed for two reasons: first because the Rules of Professional Conduct for attorneys do not have the same weight as substantive law in civil proceedings since those rules are intended to be relied upon in attorney disciplinary proceedings; secondly, the court said that the contingent fee agreement was in fact in writing, as required by the RPCs, since it was in an email sent from the attorney to the client.

Although attorneys and other businesses have traditionally favored signed paper contracts for these types of fee agreements, technology appears to be carrying more weight these days. Even though it was not mentioned in the Court’s opinion, the Court may have also found it important that there was no question that the client actually read and received the emailed fee arrangement since he paid the $32,000 in response to that email. Additionally, this client was likely quite knowledgeable in business matters since his attorney was defending him regarding a $1.5 million loan he received from his employer, a major bank.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green, P.C. Counsel on Business Litigation Issues

Call the Philadelphia business lawyers at Sidkoff, Pinus & Green, P.C. today at 215-574-0600, or contact us online, to see how we can protect your rights in when entering into or disputing business agreements.

Philadelphia Employment Lawyers: ADA Suit Against CVS

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The Third Circuit affirmed an order of the United States District Court for the Middle District of Pennsylvania, granting a summary judgment motion for CVS, the defendant in a disability discrimination case brought by the plaintiff, Nicole Moore. Nicole Moore v. CVS RX Services, Inc., No. 15-3836, (3d Cir. Sept. 8, 2016)

Moore was employed by CVS while pregnant. Unfortunately, she developed complications during her pregnancy that made it so she was not able to lift over her head or climb. CVS was unable to give her a job with these limitations, so the company allowed her to go on short-term disability. Moore returned to work after her child was born, but developed post-pregnancy complications. CVS’s Leave of Absence department approved a leave for a small period of time that was later extended to end up being a few months in total. When Moore sought to extend her leave even further, the Leave of Absence department asked her to provide proof or certification from a doctor that she was unable to work.

However, when Moore went to get the certification, her nurse practitioner cleared her for work, saying she could “fully perform her job and that she needed only intermittent leave for follow-up doctor appointments.” The department then rejected her continuous leave. When Moore did not show up for work after her extension was over, she was terminated. Moore filed a complaint for failure to accommodate her disability and disparate treatment.

The Third Circuit stated that to establish a case for failure to accommodate, the plaintiff has to show under the Americans with Disabilities Act that, “(1) plaintiff was disabled within meaning of statute; (2) plaintiff was a ‘qualified individual’; and (3) the employer knew plaintiff needed reasonable accommodation and failed to provide it”. The Court stated there was no genuine issue of material fact as to the second and third elements. The reasoning for this is that a qualified individual is one “who, with or without reasonable accommodation, can perform the essential functions of the employment position that such individual holds or desires.” Because Moore was unable to lift over or head or climb, she could not perform the basic functions of her job with accommodations, and therefore was not a qualified individual under the statute. Furthermore, CVS provided reasonable accommodation by giving her leave for 6 months; therefore, the third element was not met. The reasoning was similar for the dismissal of the disparate treatment claim, in that Moore needed to prove she was qualified for her job, and that she could perform the essential tasks of her job with accommodation, and she did not.

For more information call our Philadelphia employment lawyers at Sidkoff, Pincus & Green at 215-574-0600 or contact us online.

Philadelphia Business Litigation Lawyers: NJ Court Upholds Arbitration Award

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A New Jersey federal court recently ruled that corporate officers could be bound by an arbitration agreement that was only signed in the name of the company. The court reasoned that the individual officers were alter egos of the corporation, and successors-in-interest to their company. Significantly, because the officers had relied on the arbitration agreement to assert a counterclaim during arbitration, the court determined that they could not now escape being bound by its terms.

New World Solutions, Inc. (NWS) was formed in 2007 to provide IT services to another corporation, Asta. NWS was solely owned by Neal and Coyne, who also served as directors. Two years after formation, NWS and Asta entered into a contract for the provision of services. But after NWS paid Asta four million dollars, Asta terminated the agreement, alleging that NWS submitted inflated invoices, created a malfunctioning replacement unit, and provided essentially useless network monitoring services.

Asta commenced arbitration proceedings against NWS. The relevant provision in the services agreement specified that disputes “between the Parties” would be resolved in accordance with the Commercial Arbitration Rules of the American Arbitration Association. Although NWS was represented by counsel at the outset, at some point, Coyne, one of the directors, assumed representation and filed the counterclaim in arbitration. A separate arbitration was initiated against Neal and Coyne individually.

In addition to finding that Coyne and Neal were bound by the arbitration agreement, the arbitrator also determined that they had used NWS to defraud Asta out of hundreds of thousands if not millions of dollars. The principals were held liable for damages in excess of three million dollars. They appealed, and a New Jersey District Court confirmed the arbitration award in full on a motion for summary judgment.

The Importance of This Ruling in Business Litigation

 A threshold issue the court had to address was whether it could assert jurisdiction over Neal and Coyne because they were not named parties to the arbitration agreement. The court determined that pursuant to the Federal Arbitration Act, the court should determine whether a dispute is to be arbitrated, unless the parties agree otherwise. The court ultimately confirmed the award even though Neal and Coyne refused to participate in the proceedings.

Philadelphia Business Litigation Lawyers at Sidkoff, Pincus & Green, P.C. Provide Competent Counsel in Arbitration

This decision serves as an important reminder that corporate officers can be bound by arbitration agreements signed in the name of their principal. If you need counsel for arbitration, the Philadelphia business litigation lawyers at Sidkoff, Pincus & Green are prepared to help. With offices conveniently located in Philadelphia, we proudly serve businesses located in Pennsylvania and South Jersey. To schedule a consultation, call us at 215-574-0600 or contact us online today.

Philadelphia Discrimination Lawyers: Report Following Lawsuit Alleging Discriminatory Behavior

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On the heels of a complaint filed against them for discrimination, Airbnb Inc. proposes several steps to end discrimination. In complaint entitled Selden v. AIRBNB, Plaintiff alleges that Airbnb unlawfully denied Plaintiff’s application for housing accommodation because of his race. In response to the complaint, Airbnb filed a motion to compel arbitration and dismiss. Although no decision has been reached thus far, in an attempt to stem negative press Airbnb will change its operating procedures to prevent discriminatory behavior in the future.

On September 8, 2016, Airbnb released a report entitled Airbnb’s Work to Fight Discrimination and Build Inclusion by Laura Murphy of the ACLU. In this report they outline their steps to eliminate racism and discrimination. These steps includes changes to methods of bookings such as removing prominence of photographs, a stronger message about Airbnb’s policy on discrimination, and making everyone who uses Airbnb affirmatively agree to Airbnb’s policy on discrimination.

For more information call our Philadelphia discrimination lawyers at Sidkoff, Pincus & Green at 215-574-0600 or contact us online.