Category: Business Law & Commercial Litigation

Pennsylvania Democrats Urge Lawmakers to Allow Student Athletes to Receive Endorsement Money

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Student-athletes receive thousands of dollars in scholarship money. In fact, some students receive full scholarships for all four years of college. Yet, until recently, college athletes were prohibited from accepting compensation through lucrative endorsement deals. The governor of California recently signed legislation that will allow college athletes to receive endorsement money while maintaining their status as an amateur athlete. Democrats from Pennsylvania are hoping to follow suit and provide the same opportunity to college athletes in Pennsylvania.

According to Pennsylvania Democratic State Representatives, colleges and universities get recognition for their star athletes. These students should be compensated for their contribution, particularly when their name, image, and likeness is used. Governor Tom Wolf is open to having a conversation with the General Assembly about how to improve the system for student athletes, including those who may have endorsement opportunities.

New Legislation Would Level the Playing Field

One Representative argued in favor of the legislation, pointing out that college coaches can make millions of dollars for coaching student athletes, and corporations make billions of dollars using names and faces of popular athletes. Most college athletes do not go on to become highly paid professional athletes, so it is only fair that they are financially compensated for the athletic contribution they are making to the college or university.

Pennsylvania is one of four other states that has modeled the legislation after the California law. The NCAA opposed the California law, saying that it should have the opportunity to develop a national strategy for handling compensation for student athletes. The NCAA also released a statement saying that, with over 1,100 campuses and close to half a million student-athletes across the country, it is not possible to provide a fair and level playing field when each state has different laws related to compensating student athletes.

The Representatives have been monitoring the controversy for several years and will continue to track it. They hope it attracts support from both sides of the isle, but it is unclear at this point which committee the legislation will be assigned to as it may take time for the bill to gain traction.

Philadelphia Business Lawyers at Sidkoff, Pincus & Green P.C. Assist Clients with Endorsement Issues

If you are a student athlete, and you believe you are entitled to compensation from endorsement deals or other potentially lucrative contracts, contact the Philadelphia business lawyers at Sidkoff, Pincus & Green P.C. today. If legislation is passed that allows college athletes to be compensated, we will secure the maximum financial compensation you deserve. To schedule a confidential consultation, call us today at 215-574-0600 or contact us online. Located in Philadelphia, we serve clients throughout Pennsylvania and New Jersey.

NLRB Addresses Issues Regarding Mandatory Arbitration Agreements

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In the case of Epic Systems Corp. v. Lewis, the Supreme Court upheld the validity of employment contracts that prevent employees from pursuing collective litigation against their employer. Following this ruling, the National Labor Relations Board (NLRB) issued several decisions that addressed arbitration agreements containing class and collective action waivers. According to the NLRB, these agreements are unenforceable. The NLRB’s recent decisions include new parameters for these arbitration agreements.

In August 2019, the NLRB issued its Supplemental Decision, Order, and Notice to Show Cause in the case of Cordua Restaurants, Inc. and Steven Ramirez and Rogelio Morales and Shearone Lewis, 368 NLRB No. 43 (2019). The case resolves important issues related to Epic Systems v. Lewis.

NLRB Holdings

  • Holding One: The National Labor Relations Act (NLRA) does not prohibit employers from promulgating mandatory arbitration agreements involving employees who intend to pursue collective action under the Fair Labor Standards Act (FLSA). According to the NLRB, Section 7 of the NLRA protects an employee’s right to participate in class actions and other protected concerted activities.
  • Holding Two: The NLRA does not prohibit employers from notifying employees that they will be terminated if they fail to sign a mandatory arbitration agreement. An assistant manager notified employees that they would be removed from the schedule if they did not sign an arbitration agreement. Employees claimed that this violated the NLRA. However, the NLRB found that the manager’s statements were an explanation of the lawful consequence of refusing to sign the agreement.
  • Holding Three: Employers may not take retaliatory action against employees for filing a class action lawsuit. A Cordua employee who filed a collective action against his employer argued that the employer violated the NLRA by terminating his employment because he discussed wage issues with fellow employees and filed an FLSA collective action for wage and overtime violations. The NLRB ruled in favor of the employee, stating the decision is consistent with the board’s long-standing precedent.

The NLRB’s decisions have a significant impact on employers because it makes it clear that they may not take adverse action against employees for discussing wage issues, requesting personal records for the purpose of confirming that the employer is in compliance with obligations, or engaging in protected activity, including filing legal claims against an employer.

Philadelphia Business Litigation Lawyers at Sidkoff, Pincus & Green P.C. Counsel Clients on All Types of Arbitration Matters

The Philadelphia business litigation lawyers at Sidkoff, Pincus & Green P.C. have a track record of reaching successful settlements involving arbitration agreements. Protecting our clients’ legal rights is our top priority. To schedule a confidential consultation, call us today at 215-574-0600 or contact us online. Located in Philadelphia, we serve clients throughout Pennsylvania and New Jersey.

Court Ruling Addresses Attorney-Client Relationships

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Philadelphia litigation lawyers assist clients with attorney-client privilege issues.In 2011, physician George R. Bousamra sued Excela Health for defamation after a peer-review investigation conducted by the company revealed that Bousamra performed surgical procedures on over 100 patients whose medical condition may not have warranted surgery. Before announcing the investigation, Excela’s general counsel spoke about the investigation with outside counsel to determine the best legal course of action. Excela’s general counsel shared certain information with an outside public relations firm that the company used for crisis management. The Pennsylvania Supreme Court ruled that an organization may not disclose privileged information to the general population, or its adversaries.

During the trial, Excela tried to use the attorney-client privilege argument and the attorney work product doctrine to protect the communications from disclosure. However, Bousamra argued that Excela waived any privilege when the company’s general counsel shared information with the outside public relations firm. The Supreme Court held that Excela did waive the attorney-client privilege, but not the attorney work product doctrine when the general counsel forwarded an email to outside counsel.

PA Supreme Court Sets New Standard for Attorney Work Product Doctrine

The Pennsylvania Supreme Court looked closely at the communications that were sent from Excela to outside counsel, and considered them to be attorney work product, but the Court needed to further examine whether Excela gave up those protections when they sent the communications to the public relations firm. The Court set forth a new standard in Pennsylvania for waiver of the attorney work product doctrine by holding that the attorney work product doctrine is only waived by disclosure if the work is disclosed in a way that increases the likelihood that an adversary would obtain it. The Supreme Court returned the case to the trial court to determine whether Excela waived the attorney work product doctrine protections. The trial court has not yet ruled on whether Excela increased the likelihood that Bousamra would have access to Excela’s communications.

The Supreme Court held that Excela waived the attorney-client privilege when it forwarded a privileged email to the third party. The Court agreed that there may be instances when an attorney will need to include a third party on privileged information to provide legal advice. However, the Court found that the purpose of forwarding the communications was not to provide legal advice, but for public relations management. Therefore, the Court found that Excela waived the attorney-client privilege over the otherwise-privileged emails.

The following are important take-aways from the Bousamra v. Excela Health case:

  • Organizations should educate their employees about attorney-client privilege and the attorney work product doctrine.
  • Be careful about communications that offer legal advice or educate employees about how to identify privileged information.
  • Think twice before sending documents to a third party.
  • Mark all communications that address legal matters as confidential.
  • Third-party individuals receiving communications about legal matters should sign a non-disclosure agreement.

Philadelphia Litigation Lawyers at Sidkoff, Pincus & Green P.C. Assist Clients with Attorney-Client Privilege Issues

If you need assistance with a legal matter involving attorney-client privilege, contact the Philadelphia litigation lawyers at Sidkoff, Pincus & Green P.C. We have extensive experience in these types of cases, and we will work tirelessly to protect your rights and your company’s privileged information. To schedule a confidential consultation, call us today at 215-574-0600 or contact us online. Located in Philadelphia, we serve clients throughout South Jersey, Pennsylvania, and New Jersey.

Merck Sued Over Rescinded Job Offer

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Philadelphia employment lawyers handle employment contract disputes.Pharmaceutical giant, Merck, is being sued by a woman who was in the process of being hired by the company. She was given employment information and was offered a job over the phone by a Merck recruiter. After receiving the offer of employment in the mail, she quit her job at Crown Bioscience and made a down payment for a townhouse that was closer to Merck. The offer was later rescinded by Merck because the woman’s temporary visa expires in 2020, which means the company would have to sponsor her during the application process. Although her contract litigation claim of promissory estoppel and breach of implied covenant of good faith and fair dealing against Merck were dismissed, the court granted her leave to amend the negligent misrepresentation complaint.

U.S. District Judge Gene E.K. Pratter dismissed the plaintiff’s claim of promissory estoppel on the grounds that at-will employees may not sue for promissory estoppel under Pennsylvania law. The promise of employment was contingent, so it was not actionable for promissory estoppel purposes. The court determined that the claim would have been dismissed, even if the promissory claim was allowed for at-will employment.

Court Allows Plaintiff to Proceed with Misrepresentation Claim

The court disagreed with Merck’s argument that the economic loss doctrine prevents recovery for damages, so the plaintiff was granted leave to amend the complaint. According to the court, it was clear that Merck and the plaintiff were in the process of establishing an employer/employee relationship. The plaintiff was given employment information, which implied a job offer. Companies are aware of the fact that prospective employees use the information provided to decide whether or not to accept the position.

The plaintiff claimed that she assured the Merck recruiter that the company would not have to sponsor her because she was in the United States on a work visa, but the visa expires in May 2020. The employment offer was contingent on proof of identity and eligibility to work in the U.S. She would be required to complete an I-9 form and provide the necessary documentation. After quitting her job at Bioscience, Merck rescinded the offer on the grounds that they would be required to sponsor her in the future.

Philadelphia Employment Lawyers at Sidkoff, Pincus & Green P.C. Handle Employment Contract Disputes

If you believe that your legal rights were violated in an employment dispute, you are urged to contact the Philadelphia employment lawyers at Sidkoff, Pincus & Green P.C. To schedule a confidential consultation, call us today at 215-574-0600 or contact us online. From our offices in Philadelphia, we assist clients across South Jersey and Pennsylvania.

Legal Battle Over $4M Lottery Ticket

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Philadelphia business litigation lawyers represent employees whose rights have been violated.On March 21, 2019, a customer purchased $22 worth of Match 6 Lotto tickets at the ACME supermarket in Doylestown Borough. The tickets were printed out on four sheets of paper with several tickets on each sheet. The man who purchased the tickets returned the sheets of paper, asking that each ticket be printed individually. The returned tickets were set aside. When the winning number was announced later that day, the employee who had printed the unwanted tickets realized that one of the numbers was a winner, so she purchased the tickets and filed a claim for the winnings.

A legal battle ensued after ACME Markets Inc. filed a lawsuit against the employee, arguing that by ringing up the tickets herself, she violated company policy, which states that another employee should have completed the transaction for the tickets. The lawsuit goes on to say that ACME owns the tickets because the lottery does not reimburse stores for unpurchased tickets that were generated by an employee. The lawsuit will determine who deserves the $4.15 million in winnings.

Details of the Lawsuit

According to the lawsuit, once the Acme employee purchased the tickets and filed the claim, the ticket sale was recognized by the Pennsylvania Lottery. As a result, lottery officials were unable to stop processing the payment without a court order. On April 16, a Bucks County judge granted a temporary restraining order and a preliminary injunction against the Pennsylvania Lottery, which states that the lottery may not submit any of the winnings to the Acme employee until the legal issues have been resolved. In the meantime, the parties involved have agreed to put the winnings into an escrow account.

The lawyers representing the Acme employee argued that Acme had established a pattern of allowing its employees to purchase “mistake tickets” before a redrawing if the winnings were unclaimed. Their client, who was suspended from her job at Acme, had worked at the store for 20 years. Her legal team plans to move on to pretrial discovery.

Philadelphia Business Litigation Lawyers at Sidkoff, Pincus & Green P.C. Represent Employees Whose Rights Have Been Violated

If you believe that your legal rights have been violated by your employer, it is in your best interest to contact the Philadelphia business litigation lawyers at Sidkoff, Pincus & Green P.C. To schedule a confidential consultation, call us today at 215-574-0600 or contact us online. From our offices in Philadelphia, we represent clients in Pennsylvania and New Jersey.

Dittman v. UPMC Ruling – Pennsylvania’s Economic Loss Doctrine Permits Recovery for “Purely Pecuniary Damages” on Negligence Claims

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In 2014, a group of employees from the University of Pittsburgh Medical Center (UMPC) filed a class action lawsuit against the organization, claiming that a breach in data compromised sensitive personal employee information, including social security numbers, tax information, and confidential bank account information. The plaintiffs alleged that UMPC failed to adopt the appropriate security measures, which increased the risk of identity theft and other crimes.

In a landmark decision, the Pennsylvania Supreme Court held that employers have a legal duty to protect employee information that is stored on internet-accessible computer systems. In addition, by limiting the economic loss doctrine, claimants can sue for economic losses resulting from a failure to protect their personal data.

According to the plaintiffs involved in the Dittman v. UPMC case, as a condition of employment, they were required to provide certain personal information, including Social Security numbers and bank account information. As a result, the plaintiffs argued that UPMC had a duty to protect their information against the threat of identity theft crimes.

The plaintiffs alleged that UPMC breached this duty by failing to implement effective security measures, including encryption programs, firewalls, and adequate authentication protocols. The plaintiffs sought economic damages for losses associated with fraudulent tax returns, as well as the potential risk of identity theft crimes.

Significance of the Pennsylvania Supreme Court Ruling

The Court’s decision in the Dittman v. UPMC case made the rule of law in Pennsylvania very clear. Employers who collect personal data must take reasonable measures to protect that information. The Pennsylvania Supreme Court also adopted a wide interpretation of the economic loss doctrine, and found that employees may recover economic losses in a variety of tort actions. By limiting the economic loss doctrine, claimants can now sue for the economic losses resulting from a failure to protect personal data.

The Court’s decision also reflects the rise in cyberattacks, and the growing need for improved cybersecurity frameworks. The lower court found that employers should not be held responsible for security breaches that were not preventable. However, the PA Supreme Court overturned this argument, because companies are now expected to take advantage of the latest cybersecurity systems that protect confidential employee data.

Because of the expansive interpretation of the economic loss doctrine, defendants will not be able to rely on this line of defense to summarily dismiss negligence claims.

Philadelphia Business Lawyers at the Law Office of Sidkoff, Pincus & Green P.C. Represent Employees in Legal Disputes

If your employer failed to take adequate security measures to protect your personal information against the threat of cyberattacks, contact the Philadelphia business lawyers at the Law Office of Sidkoff, Pincus & Green P.C. Protecting your rights is our top priority, and we will work tirelessly to secure the maximum financial compensation you deserve. To schedule a confidential consultation, call us today at 215-574-0600 or contact us online. Our offices are conveniently located in Philadelphia, where we serve clients throughout Southeastern Pennsylvania, South Jersey, and across New Jersey.

Pennsylvania Superior Court Refuses to Pierce the Corporate Veil to Hold Beneficiary of Estate Personally Liable for Corporation’s Debts

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In Mark Hershey Farms, Inc. v. Robinson, the Superior Court reversed the trial court’s ruling to pierce the corporate veil and hold the executor of an estate personally liable for the debts of the company he was operating on behalf of the estate. 171 .3d 810 (Pa. Super. Ct. 2017).  Robinson was the beneficiary of his father’s estate and after his father’s passing, Robinson operated his fathers’ businesses as the executor of his father’s will. Mark Hersey Farms, Inc. (“Mark Hershey”), a creditor of one of Robinson’s father’s businesses, brought suit for the debt. The trial court pierced the corporate veil and found Robinson, along with the business and estate, personally liable for the debts incurred.

Piercing the corporate veil allows the court to disregard the liability insulation provided by the corporate form and find the shareholders personally liable. In Pennsylvania, there is a strong presumption against not piercing the veil, and courts have only found it necessary when it is clear that the corporate form is merely a pretense to hide the shareholders’ wrongdoing. When deciding whether to pierce the corporate veil, courts are concerned with how the corporate records are kept, how the shareholders, other than the dominate shareholder actually function, and whether the dominant shareholder has used assets of the corporation as if they were his own. Appellee’s argued that Appellant gained personal benefit from the business with the company, and as a result, was unjustly enriched. In order to succeed under unjust enrichment, a plaintiff must establish that (1) a benefit was conferred on the defendant by plaintiff; (2) appreciation of such benefits by defendant; and (3) acceptance and retention of such benefits under the circumstances would be inequitable.

The Court rejected Mark Hershey’s argument because it was not convinced that Robinson received a personal benefit and found that piercing the corporate veil would be without basis. The Court was clear that unjust enrichment does not apply simply because the defendant has received a benefit, and that to succeed on such a claim, Mark Hershey was required to establish that it would be unconscionable for Robinson to retain such benefit.

For more information, call Philadelphia business lawyers at the Law Offices of Sidkoff, Pincus & Green at 215-574-0600 or contact us online.

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Eastern District of Pennsylvania Rules in Favor of Store Owner in Slip and Fall Case

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In Harrell v. Pathmark, the Eastern District of Pennsylvania ruled that a store owner was not negligent in slip and fall. 2015 U.S. Dist., LEXIS 23154* (E.D. Pa. 2015). The plaintiff in this matter, Ms. Harrell, was severely injured when she slipped on a wet floor in the Philadelphia Pathmark Store.

Under Pennsylvania law, in order for a store owner to be held liable in a slip and fall action, the owner must have known about, or by the exercise of reasonable care would have discovered, a condition that involved an unreasonable risk of harm. This standard requires the plaintiff to prove that the owner either played a role in creating the dangerous condition or that the owner had actual or constructive notice of the harmful condition.

Constructive notice must be determined on a case-by-case basis because it is drawn from “the existence of facts and circumstances that a party had a duty to take notice of.” The relevant factors courts consider when determining constructive notice include: the nature of the dangerous condition; its location on the premises; its cause (or likely cause); the opportunity of the defendant to remedy the condition; and most importantly, the time elapsing between when the dangerous condition arose and when the accident occurred.” The amount of time plays such a critical role in determining notice because if the dangerous condition only existed for a very short time before the incident then, even by the exercise of reasonable care, the owner would not discover the hazardous condition.

The Court determined that Ms. Harrell was not able to provide any evidence of how the water got onto the floor, how long the water had been on the floor, or if Pathmark employees had any knowledge of the water. Furthermore, the fact that Pathmark did not follow a set cleaning or inspection schedule did not provide the sufficient evidence of constructive notice. Therefore, due to the lack of evidence presented, the Court concluded that Pathmark did not have constructive notice of the hazardous condition, and thus, was not liable for her injuries.

For more information, please call our Philadelphia business lawyers at the Law Office of Sidkoff, Pincus & Green at 215-574-0600 or submit an online inquiry.

Third Circuit Holds Computer Manufacturer Could Not Pierce Corporate Veil of Insolvent Corporate Buyer

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In Clientron Corp. v. Devon IT, Inc., 2018 WL 3293212 (3rd Cir. 2018), the Third Circuit Court of Appeals found that Appellant failed to establish under Pennsylvania law that shareholders were alter ego of Appellee and thus Appellant was not entitled to pierce Appellee’s corporate veil as reparations for a business tort. In addition, the Court held that the corporate veil could not be pierced as a discovery sanction against one shareholder to hold him personally liable for part of the judgment.

Appellant, a computer component manufacturer brought action against an insolvent Pennsylvania corporation seeking to enforce a $6.5 million arbitration award obtained in Taiwan pursuant to the Pennsylvania Uniform Foreign Money Judgment Recognition Act (“UFMJRA”). The District Court for the Eastern District of Pennsylvania declined to pierce the corporate veil to hold shareholders jointly liable thereby erasing the $6.5 million award obtained by manufacturer. The manufacturer appealed.

Although Pennsylvania law recognizes a strong presumption against piercing the corporate veil, factors weighing in favor include: “failure to observe corporate formalities, non-payment of dividends, insolvency of the debtor corporation at the time, siphoning of funds of the corporation by the dominant shareholder, non-functioning of other officers or directors, absence of corporate records, and the fact that the corporation is merely a façade for the operations of the dominant stockholder or stockholders.”

Appellant attempted to show that shareholders use of credit cards for personal use, loans from Appellee to individual shareholders, and money transfers to personal accounts of shareholders’ other companies amounted to a lack of adhering to corporate formalities. The Court found, however, that the evidence was insufficient because “lack of formalities in a closely-held corporation does not often have as much consequence as where other corporations are involved”. Therefore, the Court held that Appellants evidence was insufficient to overcome Pennsylvania’s strong presumption against piercing the corporate veil.

The Philadelphia business lawyers at The Law Offices of Sidkoff, Pincus & Green represent clients is all areas of business law. Contact us online or call us at 215-574-0600.

Eastern District of PA Prevents Credit Reporting Agencies from Venue Transfer

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On June 20, 2018 the Eastern District of Pennsylvania prevented a consumer credit reporting agency, Equifax, from transferring a case from Pennsylvania to Georgia. Edwards v. Equifax Info. Servs., LLC, No. CV 18-1077, 2018 WL 3046603, at *1 (E.D. Pa. June 20, 2018). Consumer credit reporting agencies gather consumers’ personal information about their credit history, credit worthiness, mode of living, and other personal characteristics which they then analyze and sell. Credit reporting agencies like Equifax gather this information independently and not at the request of the person whose credit is being reported on. Consumers must therefore react to the actions of credit agencies in this unilateral relationship. To properly maintain this unusual relationship Congress passed the Fair Credit Reporting Act (FCRA) to create a “national standard for regulating the relationship between credit reporting agencies and consumers.”

In this case the plaintiff brought a claim alleging that Equifax violated the FCRA by failing to provide contact information for entities that accessed his credit information. After the case was removed to the Eastern District Court, Equifax then sought to have the venue changed and moved to the Northern District of Georgia. Equifax is headquartered in Atlanta and claimed that “all documents, data, and witnesses pertinent to the claim are also located there” which made it a far more suitable location to litigate the dispute. The Court however rejected the change in venue due to the concern that any FCRA claim would force all plaintiffs to bring claims in districts far from where they live, “a burden that would inevitably undermine enforcement of federal consumer protection laws under the system of private litigation that Congress sought to incentivize.” The Court predicated their belief on the fact that in the e-commerce era credit reporting agencies operate nationwide and impact the lives of people hundreds or thousands of miles from the agencies’ headquarters and do so not at the behest of the person who is being reported on. After analyzing the procedural rules for changes in venue pursuant to the Federal Rules of Civil Procedure, the Court articulated that Congress has repeatedly amended the FCRA to promote private enforcement and to allow all credit agencies to force plaintiffs to litigate elsewhere would stop private enforcement. Further the balance of convenience strongly favored and required maintaining venue in the Eastern District of Pennsylvania where the plaintiff resides.

For more information, contact the Philadelphia business lawyers at the Law Office of Sidkoff, Pincus & Green at 215-574-0600 or contact us online.