New Jersey Lawyer & Attorney : Stark & Stark Law Firm : New Jersey Law Blog

Each plan subject to minimum-funding requirements must maintain a minimum-funding standard account and meet a minimum-funding standard. A funding standard account consists of charges for normal costs, amortization costs and funding deficiencies, offset by credits for amounts contributed by the employer, amortization gains, waived funding deficiencies, and the excess of any debit balance in the funding standard account over any debit balance in the alternative minimum standard account, if any.
 

All costs, liabilities, rates of interest, and other factors under the plan must be determined on the basis of actuarial assumptions and methods that must be reasonable in the aggregate and in combination offer the actuary's best estimate of anticipated experience under the plan. A plan meets the minimum-funding requirements only if, at the end of each plan year, the account does not have an accumulated funding deficiency.

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Adam J. Siegleheim, member of Stark & Stark's Franchise Group, attended the 2011 International Franchise Expo's Annual Convention February 13-16, 2011 in Las Vegas, Nevada. In this podcast, Mr. Siegelheim meets with Thomas Scott of Brand Journalists. Mr. Siegelheim and Mr. Scott discuss how to use social media outlets in order to strategically grow your brand and drive qualified traffic to your franchise.

You can listen to the full podcast online here. 

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The Appellate Division has recently upheld summary judgment in favor of a guarantor who had executed a personal guaranty for rent due under a lease, finding that the specific language of the guaranty, read in conjunction with the language of the lease, rendered the guaranty inapplicable in a holdover situation.

In Montpen SC, L.L.C. v Mathews Art, Inc., d/b/a/ Art Wholesalers, Ltd., A-5036-09T3 (March 30, 2011), the Appellate Division had before it a situation where a tenant’s business had been purchased by a third party and its lease assigned to the purchaser. Fearing that the purchaser, a shell company, would be judgment proof in the event of default, the landlord required that the principal of the purchaser execute a personal guaranty to secure the landlord’s consent to the assignment of lease and agreement of an extension of the lease.

Notwithstanding the landlord’s exercise of caution, the landlord was not careful enough. The lease specifically addressed a holdover situation and designated such circumstances as not constituting a renewal or extension of the lease. The guaranty, however, contained specific language which limited the guarantor’s obligations under the lease to the initial term of the lease and any “extensions and renewals thereof.”

In finding that the guaranty was not enforceable in a holdover situation, the court dispensed with the landlord’s argument that the guaranty was a substantial inducement for its agreement to allow the assignment and to authorize the extension of the lease. The court, having before it a clear and unambiguous lease and guaranty, declined to make for the landlord a better agreement than it had made for itself.

Commercial landlords should be aware of the possibility of a guarantor escaping his responsibilities under a guaranty and ensure that they have enlisted counsel cognizant of the potentially ruinous results of a poorly crafted lease or guaranty. Moreover, an abundance of caution should be exercised when dealing with savvy tenants who use, and often abuse, the myriad corporate forms available to them in order to avoid liability.

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A waiver of subrogation in insurance policies for associations is always a thing of mystery.  However, a recent case occurred that I believe requires community association managers and boards to pay more attention to this issue.

Most association by-laws require that the association’s insurance policy include  a waiver of subrogation.  This waiver of subrogation within the insurance policy will prohibit the insurance company from  seeking reimbursement of monies paid to the association from any party, as that party is defined within the insurance policy.  However, in this recent case,  the association’s insurance policy did not have the wavier of subrogation anywhere and therefore the insurance carrier was able to proceed against certain parties.

Association managers needed to make certain the insurance professional provides the association a writing, after the policy has been obtained, indicating where exactly within the policy the appropriate waiver of subrogation language is set forth.  Knowing this information will provide the association with the level of comfort it is entitled to under the terms of the insurance policy.
 

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Timothy P. Duggan, Chair of Stark & Stark’s Real Estate Tax Appeals Group, was featured in the February 21, 2011 NJ Biz article, A taxing affair for towns as appeals mount.

The article discusses the recent rise of property tax appeals taking place in New Jersey as the steep drop in property values continues after the market crashed. Mr. Duggan states, “property owners should analyze their property to determine whether an appeal is appropriate. You can be properly assessed, and your neighbor under or over. The question is whether your property is properly assessed irrespective of what is going on in the market.”

You can read the full article online here.

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On March 4, 2011, the Appellate Division of the New Jersey Superior Court, in a case captioned Mid-Atlantic Solar Energy Industries Association v. Christie, reviewed a challenge to Section six of the 2010 Supplemental Appropriations Act (P.L. 2010, c. 19), which authorized the reallocation of $158,000,000 collected under the Electric Discount and Energy Competition Act (EDECA) and deposited into the Clean Energy Fund for purposes other than those expressly set forth in the EDECA.  “The question presented by this appeal is whether the Legislature has the power to authorize another use of the portion of those monies deposited in the Clean Energy Fund, specifically their transfer into the General Fund by means of an Appropriations Act.”

In evaluating this issue, the court looked to past practices and found that “[n]otwithstanding the limitations the EDECA places upon the use of the money collected under the societal benefits charge, the Legislature has repeatedly included provisions in Appropriations Acts authorizing distributions from the Clean Energy Fund that are not provided by the EDECA, including transfers into the General Fund.”  Additionally, the court consulted case precedent and determined that the Appellate Division and the Supreme Court “[h]ave long recognized that the Legislature has the authority to change or suspend the operation of its prior enactments through an Appropriations Act.”  In light of these findings, the court upheld Section six of the 2010 Supplemental Appropriations Act as a legitimate exercise of legislative authority, which “[h]ad the same operative effect for the 2009-10 State fiscal year as an amendment to N.J.S.A. 48:3-60(a) to authorize appropriation of money collected thereunder for any purpose the Legislature might determine rather than solely the purposes originally set forth in this statute.”

The Appellate Division also rejected the plaintiff’s argument that the monies deposited into the Clean Energy Fund are private rather than public funds (since they are primarily generated by the imposition of the societal benefits charge upon public utility customers) and, therefore, may not be moved into the General Fund by the Legislature.  According to the court,

[i]f the characterization of the money in the Clean Energy Fund as ‘public’ were a prerequisite to upholding the Legislature’s authority to transfer a portion of it into the General Fund through an Appropriations Act, the pervasive role of the Legislature and the [Board of Public Utilities] in authorizing this charge and determining the uses of the money collected thereunder would warrant this characterization.

In any event, we do not view the characterization of the money collected under social benefits charge as ‘public’ or ‘private’ to be dispositive of the Legislature’s authority to authorize a transfer of some of that money into the General Fund.  However, this money may be characterized, the fact that the Legislature has authorized its collection and directed the purposes to which it may be allocated means that the Legislature retains the authority to change those permitted purposes.

By this case, the Appellate Division has reconfirmed that State government may transfer monies expressly reserved for clean energy programs (or for other specified purposes) to the General Fund and use them for any legitimate public function.  The court’s decision in Mid-Atlantic Solar Energy Industries Association v. Christie may be viewed on Westlaw at 2011 WL 744860 (N.J.Super. A.D.) and has been approved for publication.

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In a recent decision, 350 Main Street, LLC v. Ren Guan Li d/b/a Sun Hing Restaurant, A-3265-09T4 (March 21, 2011), the Superior Court of New Jersey, Appellate Division, examined whether the strict compliance requirements regarding notice under New Jersey’s Anti-Eviction Act (N.J.S.A. 2A:18-61.1a) were applicable to the statute governing non-residential evictions (N.J.S.A. 2A:18-53). In answering this question in the negative, the Appellate Division examined various case precedents as well as the express language of both statutes. 
 

In reaching its conclusion the Appellate Division noted that the Anti-Eviction Act expressly states that notice must be given to the residential tenant, “prior to the institution of the action [for possession].” Conversely, the statute governing non-residential evictions contains no such express language requiring notice before the commencement of suit. Thus, the Appellate Division held, “We find nothing in the plain language of N.J.S.A. 2A:18-53 that would permit or require us to read into that statute the requirement that notice to quit precede suit.” 350 Main Street, LLC at 13.
 

Moreover, the Appellate Division also noted that policy concerns surrounding the enactment of the Anti-Eviction Act have not been expressed in those cases concerning commercial evictions. Although unreported, the 350 Main Street, LLC decision should be a welcome sign for commercial landlords that New Jersey courts are not seeking to impose necessary protections in the residential context in matters in the commercial arena, where such protections are neither needed nor appropriate.
 

Nevertheless, landlords and commercial property owners should not construe this decision or the absence of such express notice language in the statute governing non-residential evictions to mean that they are free to proceed as they deem appropriate. Even in the commercial context, there are requirements that must be complied with otherwise, a commercial landlord could find itself embroiled in an lengthy legal battle, where had they sought the advice and consent of trusted counsel same could have been avoided.

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Timothy P. Duggan, Chair of Stark & Stark’s Condemnation & Eminent Domain Group, was quoted in the March 18, 2011 NJ Biz article, N.J. Supreme Court decision could affect commercial lease negotiation.

Mr. Duggan comments on the recent New Jersey Supreme Court decision on a Kearny eminent domain case which would affect the majority of commercial lease negotiations in the state. Mr. Duggan states that the decision “is going to have a minimal impact on the majority of condemnation cases, because in the majority of condemnation cases, the government will take the entire property from the owner.”

You can read the full article online here.

 

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ERISA establishes the fiduciary responsibilities applicable to employee benefit plan administrators and sets out certain fiduciary standards by which trustees' actions will be measured, including the mandate that trustees are to discharge their duties solely in the interest of the plan with the care, skill, and diligence which a prudent individual would use in similar circumstances in accordance with the instruments governing the plan and through diversifying the plan's investments.

Supplementing these fundamental standards prohibits specific transactions. A plan fiduciary may not cause the plan to engage in a transaction that constitutes a loan, sale, or other transfer of assets to a party in interest, or the improper acquisition of employer security or real property. The statute also forbids a fiduciary from dealing with assets of the plan in his own interest or receiving consideration from any party dealing with the plan in a transaction involving plan assets; nor may a fiduciary participate in any transaction involving the plan on behalf of a party whose interests are adverse to the plan. Trustees who violate their fiduciary duty may be held personally liable and the courts are free to fashion equitable relief appropriate to the circumstances, including removal of the trustee. 

Fiduciary duty under ERISA has three components:

1. a duty of loyalty pursuant to which all decisions regarding an ERISA plan must be made with an eye single to the interest of the plan participants and beneficiaries;
2. the prudent-person obligation imposes an unwavering duty to act both as a prudent person would act in a similar situation and with single-minded devotion to those same plan participants and beneficiaries; and
3. an ERISA fiduciary must act for the exclusive purpose of providing benefits to plan beneficiaries.

Of these, the duty to act solely in the interest of plan participants and beneficiaries has been called the main fiduciary duty.
 

A participant, beneficiary, or other fiduciary may bring a civil action against any plan fiduciary who breaches any responsibilities, obligations, or duties under ERISA. However, the statutory provisions recognizing a right of action against an administrator for breach of trust obligations are limited to claims on behalf of the plan for misconduct regarding the trust itself, not the payment of benefits to participants. Recovery from a fiduciary for breach of fiduciary duty inures to the benefit of the plan as a whole. 
 

Therefore, ERISA actions for breach of fiduciary duty should be brought in representative capacity on behalf of the plan as whole. The trick seems to be proving that the plan assets themselves have been improperly depleted, rather than just the anticipated benefits of the individual plaintiffs being extinguished. 
 

Moreover, there is usually a question or disagreement regarding whether the alleged wrongdoer, is actually a fiduciary or trustee of the pension plan. To determine whether a person is a fiduciary under ERISA with respect to the particular function at issue, discretionary authority or responsibility of such person with respect to that function must be examined and the actions of the person to be charged as a fiduciary for the function must be considered. However, the ERISA provisions, creating a duty of care by requiring the administrator to use the care, skill, prudence, and diligence, under the circumstances then prevailing, that a prudent person acting in a like capacity and familiar with such matters would use in conduct of like enterprise does not create a standard of absolute liability. For an ERISA fiduciary to be liable for a breach of duty, there must be a showing of some causal link between the alleged breach and the loss the plaintiff seeks to recover. To show that a fiduciary is excused from liability for any loss which results from a participant's or beneficiary's exercise of control over an investment under an ERISA provision, the causal nexus between the participant's or beneficiary's exercise of control and claimed loss is established with proof that the participant's or beneficiary's control is the cause-in-fact, as well as a substantial contributing factor in bringing about the loss incurred.  Notably, the fiduciary duties owed participants and beneficiaries under ERISA apply only to the administration of the plan, not to its formation, amendment, or modification.
 

However, vested pension rights may not be altered without the consent of the retirees. Vesting of pension rights occurs when all the eligibility requirements of a voluntary noncontributory pension plan have been met, and the retiree may not therefore be divested of his rights. 
 

Nonetheless, in the past, courts have upheld the district court's conclusion that an employer was not acting in an ERISA fiduciary capacity in amending its pension and welfare plans to allocate assets and liabilities between itself and a newly created subsidiary, even though it allegedly "rigged" the allocation procedures so that the subsidiary might not have enough money to provide the benefits by the time it became responsible for the retirement benefits of the former employees of the parent corporation.  The district court had rejected arguments that the employer, although not a fiduciary in making the decision to restructure, became a fiduciary when it "invaded" its ERISA plan trust corpus to allocate the trust assets and thereby exercised management and control over the assets.  In upholding this decision, the court noted that changing the design of a trust does not involve the kind of discretionary administration that typically triggers fiduciary responsibilities.  The court concluded that the conduct complained of—that the employer had allocated the assets of its plans in a manner allegedly benefiting the employer to employees' detriment—might violate ERISA provisions regarding transfer of plan asset, but that the allocation did not implicate ERISA's fiduciary provisions. 
   

The 1980 amendments provided that a plan sponsor (the trustees) may cause a multiemployer plan to merge with another only if it complies with regulations of the Pension Benefit Guaranty Corporation, the benefits of participants are not adversely affected, and other statutory conditions are observed.

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Adam J. Siegelheim, member of Stark & Stark's Franchise Group, attended the 2011 International Franchise Expo's Annual Convention February 13-16, 2011 in Las Vegas, Nevada. In this podcast, Mr. Siegelheim meets with Paul Segreto of Franchise Essentials. Mr. Siegelheim and Mr. Segreto discuss social media and how franchisors can utilize social networking applications, such as Facebook, Foursquare, LinkedIn and Twitter, to enhance their brand.

You can listen to the full podcast online here.

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A party’s involuntary loss of a job and subsequent employment at a lower wage, are not necessarily determinative for a reduction in alimony. There are criteria that a Court must consider in determining whether the spouse seeking modification has established a case for modification. It is well-settled law that temporary unemployment or a temporary change in employment is not adequate to reduce alimony. Other factors a Court must consider are the party’s assets and income that he or she could have earned from personal attention to business as well as the efforts made to find comparable employment. In addition, the Court may analyze the post-marital lifestyle (expenses) of the paying spouse in view of the marital standard of living.

In the recent case of Ianneillo vs Ianneillo, the ex-Husband was laid off from his job and quickly found re-employment at a lower salary at which time he filed a Motion to Reduce Alimony. The Court focused on the fact that the Husband remarried and purchased a new marital residence which had a substantial monthly mortgage payment. This latter obligation was voluntarily incurred without regard to his pre-existing alimony obligation. It was also noted that there was nothing in the record to establish that his current job was more than temporary. Further, although he made statements to the Court in his Certification that his efforts to find new employment at a higher salary were diligent, he did not prove same to the Court. As a result, the Court denied his application for a reduction in alimony.

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Stark & Stark Shareholders, Gary S. Forshner and Timothy P. Duggan, will present seminars at the 62nd annual New Jersey Builders Association’s 2011 Atlantic Builders Convention. The convention will take place April 6-8, 2011 in Atlantic City, New Jersey. 

Mr. Forshner will present two seminars at this year’s convention. The first seminar, entitled, Affordable Housing, will take place Wednesday April 6, 2011 from 11:00 AM – 12:30 PM at the Atlantic City Convention Center in conference room 318. The seminar will discuss the status of affordable housing litigation, legislation and newly enacted law.

Mr. Forshner’s second seminar, entitled, Repositioning Failed Projects, will take place Thursday April 7, 2011 from 11:00 AM – 12:30 PM at the Atlantic City Convention Center in room 320. The seminar will offer advice on identifying a viable market, and repositioning failed projects, including change of zoning and PRED filings.

Mr. Duggan will present a seminar entitled, Tax Strategies for Builders & Investors, Wednesday April 6, 2011 from 9:00 – 10:30 AM at the Atlantic City Convention Center in room 416. The seminar will discuss financial and tax strategies that can boost the bottom line of builders, associates and investors.  New regulations, real estate tax appeals and the federal New Market Tax Credit will be included.  Examples and case studies will also be provided.

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On March 3, 2011, Governor Christie conditionally vetoed Senate bill S2126, which I have dubbed the “solar landfill bill” and summarized on February 7, 2011.  Judging from the Governor’s veto message, it appears that Governor Christie is inclined toward approving this bill; provided, however, that the Legislature agrees to insert “some technical changes . . . needed to accomplish the intention of the legislation concerning the existing landfill and resource extraction operations within the Pinelands area.” 

For example, the Governor wants to eliminate the requirement that a resource extraction operation must be both “closed” and “operated pursuant to a resource extraction permit on or after December 31, 1985" in order to host a solar or photovoltaic energy facility or structure.  According to the Governor’s veto message these “technical changes” were recommended “by the Pinelands Commission and [the] primary sponsor of this legislation.”  As such, it is probably only a matter of time before the solar landfill bill becomes law.

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Have you ever wondered what you’re worth?  No, not your “net worth” (i.e. the cumulative value of your assets less any debts or liabilities), but the commercial value of your name, identity, image or likeness.  Yes, you have a right of publicity: the right to control the use of your name, picture, voice, image or likeness, and to prevent another from using the same for commercial benefit without your consent.       
                               

New Jersey, like most states, recognizes this right of publicity.  The right of publicity “signifies the right of an individual, especially a public figure or celebrity, to control the commercial value and exploitation of his name and picture or likeness and to prevent others from unfairly appropriating this value for commercial benefit.”  Hart v. Electronic Arts, Inc., 2010 WL 3786112 *5, (D.N.J. Sept. 22, 2010; citing McFarland v. Miller, 14 F.3d 912, 918 (3d Cir. 1994); Prima v. Darden Rest., 78 F.Supp.2d 337, 348 (D.N.J. 2000); also citing Jarvis v. A&M Records, 827 F.Supp. 282, 297 (D.N.J. 1993) (“[t]he right of publicity generally applies to situations where the plaintiff’s name, reputation or accomplishments are highly publicized and the defendant used that fact to his or her advantage”).  Fundamentally, the right of publicity acknowledges the validity and legality of a person’s interest in his/her name or likeness in the nature of a property right.  Restatement (Second) of Torts, § 652C comment a.  The courts have further articulated this right, recognizing that “a celebrity has the right to capitalize on his persona, and the unauthorized use of that persona for commercial gain violates fundamental notions of fairness and deprives the celebrity of some economic value in his persona.”  Hart, supra, at *5 (citing Prima, 78 F.Supp.2d at 349).  The violation of an individual’s right of publicity and unauthorized use of his/her likeness - especially celebrities whose status often generates wealth - harms the individual by diluting the value of his/her name and depriving that individual from just compensation.  Id.   
 

The prima facie case for infringement of the right to publicity is, in essence, a two-fold requirement: validity and infringement.  Validity relates to whether the individual has an enforceable “property” right in his likeness.  Hart, 2010 WL 3786112 at *6.  Infringement speaks to whether the defendant, without permission, used the likeness in such a way that plaintiff is identifiable and in a manner likely to cause damage to the commercial value of the individual.  Id.

Over time, this right of publicity has evolved (some states have adopted statutes protecting rights of publicity) and the number of publicity rights disputes has increased.  Athletes, in particular, are moving the chains.  Ed O’Bannon, who starred on UCLA’s 1995 NCAA basketball title team, filed a class-action lawsuit against the National Collegiate Athletic Association (“NCAA”) and Collegiate Licensing Company (“CLC”) for the use of his and other players’ images and likenesses in video content, photos and other memorabilia.  Sam Keller, a former quarterback at Arizona State and Nebraska, filed suit against Electronic Arts, Inc. (“EA Sports”) for replicating his likeness in its NCAA Football video games.  NFL great Jim Brown sued EA Sports over the use of his likeness in the popular Madden NFL video games, and most recently, NBA legend Oscar Robertson has filed suit against the NCAA, CLC and EA Sports arguing that the defendants have attempted to control his likeness into perpetuity.

Ryan Hart is advancing the ball in New Jersey.  On June 15, 2009, Hart filed a putative class action lawsuit, on behalf of himself and all others similarly situated, against EA Sports alleging, among other things, that EA Sports invaded his right of privacy by misappropriating his likeness for commercial purposes and violating his right of publicity.  In his complaint, he claims EA, without his consent, used his likeness in its NCAA Football video game series for the years in which Hart was quarterback of the Rutgers University football team, and again in 2009, in which Hart claims a photograph of him appears in a montage of actual college football players.
 

According to Hart, the similarities between he and the “virtual” Rutgers quarterback in the video game are palpable, the commonality of the attributes unmistakable.  For example, the virtual quarterback in the video game shares the same height and weight as Hart.  Aside from those immutable traits, the virtual quarterback dons jersey number 13, wears a left wrist band and has a helmet visor, just as Hart did when he ran the Rutgers offense.  Hart points out that the virtual quarterback, like Hart, hails from Florida.  Hart also has alleged that EA, in the promotion of its video game, used actual video footage of him throwing a pass in Rutgers’ 2005 Insight Bowl game against Arizona State.
 

The NCAA, CLC and EA Sports have raised several defenses to these claims.  After all, the doctrine has discernible standards.  For example, in Hart’s case, EA Sports has argued that Hart’s likeness was not used for a commercial purpose.  The use of a person’s likeness for non-commercial purposes, such as the dissemination of news or information, generally is not actionable.  See Castro v. NYT Television, 370 N.J. Super. 282 (App. Div. 2004) (disallowing emergency room patients filmed for a reality TV show to recover for misappropriation of their likeness).  Not every use of one’s image by a commercial publication is considered a commercial use.
 

EA Sports also has sought safe harbor under the First Amendment, arguing that the medium in which the alleged misappropriations have occurred - the video games - are creative, expressive works entitled to First Amendment protection.  According to the court in Hart’s case, the applicability of this defense depends on whether the video game is considered commercial speech or an artistic work.  Hart, supra, *10 (citing Facenda v. N.F.L. Films, Inc., 542 F.3d 1007, 1018 (3d Cir. 2008).  In these cases, the defendants also have pointed to the existence of various federal laws under which the claim may be preempted.
 

The plaintiffs, however, maintain that the misappropriation of their likeness is tantamount to stealing; they otherwise would be entitled to market and promote themselves and reap the financial benefits.       
 

Many of these cases (including Hart’s) are pending, and it remains unclear how these disputes will resolve.  Still, what is clear is that a right of publicity exists, and it gives an individual, especially a public figure or celebrity, the right to control the exploitation of his likeness and to prevent others from infringing upon that right for commercial benefit.

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Facebook, Twitter, LinkedIn, YouTube, personal blog sites and other social media and networking sites have become a part of everyday life.  Not surprisingly, social networking and social media sites have found their way into the workplace.  While such sites can be an extremely valuable resource for both employers and employees, their use also gives rise to a variety of new legal issues, concerns and claims for employers to navigate.  With the advent of such issues, large and small employers alike are now recognizing the need to develop and implement policies to limit and control their employees’ work-related Internet posts as well as the employers’ own use of social networking sites in making hiring and employment decisions.

While social media can provide new ways to interact and respond to customers, social media activities by employees can create numerous problems for employers.   For example, a company can work for years to craft a positive image of itself to the public and its client base, only to have that image instantly tarnished by negative postings from employees. Other risks concern the disclosure of employers’ confidential, proprietary and/or trade secret information. Whether it may concern marketing plans, identity of customers or current projects, inadvertent distribution of such information by employees via social networking may significantly undercut a company’s business plans and strategies – even if the information is only unwittingly disclosed.
 

But it is not just the employee’s use of social media that warrants concern.  These sites often hold a wealth of information that may be useful in screening job applicants. In fact, many employers now use social networking sites to screen potential hires. However, in so doing, an employer may also learn about information that may later become the basis of a discrimination lawsuit. For example, what if photos or comments posted on a rejected applicant’s Facebook page revealed her membership in a class protected under federal or state laws - such as her race, age, health condition, political or religious affiliation, or pregnancy status?  Whether or not the information putting her in the protected class was a determining factor in a decision not to hire her, the fact that the employer checked the applicant’s Facebook page and was aware of that fact may give rise to an allegation of discrimination.
 

Recognizing these risks, many employers are wisely implementing policies to directly address the use of social-networking sites so that employees know exactly what is expected of them.  There is not a one-size-fits-all policy for employers.  Some businesses – such as those that focus on sales and marketing, may, in fact, depend on social media and networking sites and may even mandate their employees’ use of the sites as an essential part of their job duties.  Other businesses may wish to ban the use of social networking and media sites at work altogether.
 

Although there are inherent risks in the use of social media, employers can minimize such risks by evaluating the issues involved and adopting and implementing policies appropriate to their particular business and circumstances with a minimal investment of time and resources.  Development of a social media policy requires an understanding of the specific employer’s needs; the potential rewards and liabilities arising out of the use of social media for that employer; employees’ rights and liability issues; and the realistic social media use of its employees.  Once this analysis – whether formal or informal – is undertaken, an employer can establish appropriate policies for the use of social media to make decisions about job applicants and employees, to address employees’ use of social media – both at and away from work (when the activities directly affect the employer) and to ensure that the policies are consistently implemented.  With such policies and procedures in place, employers can maximize the benefits and opportunities presented by social media and networking, while limiting the potential pitfalls that accompany use of the Internet sites.

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The completion of the Seller’s Disclosure Statement is a task that is often taken lightly by a Seller of residential real estate when they are preparing to sell their house.  In fact, many individuals when faced with completing this task give it little thought and complete it in a cursory fashion. What a Seller should be aware of, however, is that any misstatement of fact, whether intentional or not may subject a Seller to liability post-closing.  In the State of New Jersey a Seller of residential real estate has a duty to disclose any and all latent defects with regard to the condition of their property.  A latent condition is a condition that is not otherwise observable, or in essence, hidden.  Examples of latent conditions are radon contamination, underground oil tank leaks, or a history of water problems.  If a Seller fails to disclose the existence of a latent defect of which they have knowledge, this party may be subject legal claims post closing for failure to disclose the defect(s).  The Claims that may be filed against a Seller would be claims of fraudulent concealment or fraudulent misrepresentation.

In order for a Plaintiff to prevail on a claim of fraudulent concealment or fraudulent misrepresentation, the plaintiff must first establish that the Seller had actual knowledge of the defect and that the Seller either fraudulently misrepresented the condition or failed to disclose same to the Buyers.  Thereafter, the Plaintiff must demonstrate that the defect was material to the real estate transaction.  It is for this reason that the careful completion of a Seller’s Disclosure Statement is extremely important when a party is selling their real estate.

In order to avoid being subjected to a lawsuit post-closing, a seller should make sure that the Seller’s Disclosure Statement is accurate and inclusive.  If it is completed in this fashion, it is far less likely that a party could be subjected to claims for fraudulent concealment or fraudulent misrepresentation.  Obviously, in this harsh economic climate it is better to put yourself in a position where you are far less likely to be sued rather than in a position where you might be sued due to a simple lack of diligence in completing the Seller’s Disclosure Statement. 

If you feel you are the victim of fraudulent misrepresentations or omissions, you should be aware that prosecuting this type of claim is challenging.  You must first establish that the party had actual or constructive knowledge of the defect and that they either misrepresented the condition or failed to disclose same.  As such, you must present evidence which demonstrates that the condition existed and that the purchaser either had actual knowledge or constructive knowledge of same.  Although a party may believe that the Seller had actual knowledge of a defect, it nonetheless carries the burden of proof.  Thereafter, you must demonstrate that the defect was material to the real estate transaction.

As such, the simple a task of completing the Seller’s Disclosure Statement may seem, it is important that it be taken seriously, as it may expose a Seller of residential real estate to lawsuits post-closing should this document not be properly completed. 

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You are more than likely one of the 500 million active users on Facebook who willingly choose to share your comments, pictures, and status updates with friends and family.  It is easy to lose sight of the gross reality that our “second self,” or our presence on the Internet, is anything but private.   The belief that one retains a privacy interest in their social networking accounts is being dispelled by a recent decision in the Pennsylvania Court of Common Pleas of Jefferson County. 

In McMillen v. Hummingbird Speedway, Inc., a personal injury action, the defendant questioned in a set of interrogatories whether the plaintiff belonged to any social networking sites and to provide plaintiff’s usernames, login names, and passwords. McMillen v. Hummingbird Speedway, Inc., No. 113-2010 CD (C.P. Jefferson, Sept. 9, 2010).  Upon reviewing the public portion of plaintiff’s Facebook account, the defendant discovered comments relating to relevant facts surrounding the litigation.  Plaintiff’s counsel claimed confidentiality or privilege to the information.  Defendant then moved to compel discovery, arguing that the areas to which they did not have access could contain further comments which would impeach or contradict plaintiff’s disability and damages claims.  Plaintiff contended that the court should recognize communications “shared among one’s private friends on social network computer sites as confidential and thus protected against disclosure.”  A “social network site privilege” has not been recognized under Pennsylvania statute or case law.  President Judge John Henry Foradora found that while people use these forums, such as Facebook, MySpace, and their counterparts to seek advice on personal and private matters, “it would be unrealistic to expect that such disclosures would be considered confidential.”  After careful review of the privacy and disclosure policies of Facebook and MySpace, the court concluded that the users are on notice that their communications posted may be revealed to third-parties.  Accordingly, the court held that access to one’s social networking sites is not protected by any privilege.  As a result, plaintiff was compelled to turn over his usernames and passwords of his Facebook and MySpace accounts to defendant’s counsel.

Likewise, in Romano v. Steelcase Inc. a New York Suffolk County Supreme Court ordered plaintiff to sign an authorization permitting the defendant to access her Facebook and MySpace accounts, including any records previously deleted or archived. Romano v. Steelcase Inc., N.Y.S.2d 650 (N.Y. Sup. Ct. 2010).  In a personal injury action, defendant found pictures of plaintiff on her Facebook and MySpace accounts that yielded relevant information regarding damages and the extent of plaintiff’s injuries.  Acting Justice Jeffrey Arlen Spinner rejected plaintiff’s arguments that it violated her Fourth Amendment right to privacy.  In analyzing the websites privacy policies, the court found users are aware that they post content to the sites at their “own risk.” 

In light of these two decisions, it becomes increasingly apparent that courts are not willing to recognize a privacy interest in one’s accounts on social networking sites.  So remember, everything can become public.

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As a long-term employee, it is important to know what is happening with your pension plan, but more importantly, what could happen.  There is an enormous body of law that covers retirement plans, however, given its convoluted nature, a simple question or issue may require a lengthy and complex answer.  Nonetheless, below, and following in later posts, is a condensed discussion of the general law and some of the more prominent issues that arise in the context of pension plans.

The Employee Retirement Income Security Act of 1974 (“ERISA”), established a comprehensive regulatory and remedial scheme designed with a curative aim to protect individual pension rights and is liberally construed to safeguard the interests of fund participants and beneficiaries and to preserve the integrity of fund assets. 

ERISA's policy is to protect the interests of employee-benefit plan participants and beneficiaries, by requiring the disclosure and reporting to them of financial and other plan information; by establishing standards of conduct, responsibility, and obligation for fiduciaries; by providing appropriate remedies, sanctions, and ready access to the federal courts; and by improving the equitable character and the soundness of such plans through requirements as to the vesting of accrued benefits of employees with significant periods of service, minimum standards as to funding, and a requirement as to coverage by plan termination insurance.
   
Pension funds are governed by ERISA and it is well established that ERISA displaces all state law purporting to relate to private pension plans. The statute, however, does not address many of the issues that arise in the normal course of the administration of such pension plans. Therefore, in a situation where the statute does not provide explicit instructions, it is well settled that Congress intended that the federal courts would fill in the gaps by developing, in light of reason, experience, and common sense, a federal common law of rights and obligations imposed by the statute.

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The Hon. Rodney W. Sippel, U.S.D.J., presides over the federal multi-district litigation in the Eastern District of Missouri addressing claims against NuvaRing®.  Judge Sippel held a case management conference on February 14, 2011 at 3:30 p.m. wherein Plaintiffs addressed the possibility of naming an additional defendant, NV Organon.  Judge Sippel Ordered Defendants to respond to Plaintiffs’ stipulation by March 16, 2011.

As we have discussed in previous posts, studies have shown that the ingredients contained in the birth control product NuvaRing® have been linked to various forms of severe side-effects including: heart attack, stroke, deep vein thrombosis (also known as DVT or blood clots), internal organ damage, myocardial infarction and pulmonary embolism.

At Stark & Stark we pursue claims throughout the nation against drug manufacturers, so they can be held accountable when the drugs they market are proven to be defective or cause catastrophic injury to the people who use them. Contact Stark & Stark to speak with one of the Mass Tort/ Pharmaceutical Litigation attorneys, free of charge, who can help assess any claims that you might have against the manufacturers of NuvaRing®.

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Adam J. Siegelheim, member of Stark & Stark’s Franchise Group, will present a seminar in conjunction with the New Jersey Institute for Continuing Legal Education entitled, The Legal Aspects of Franchising. The seminar will take place Thursday, June 09, 2011 from 9:00 AM to 1:00 PM at the Wilshire Grand Hotel, West Orange, New Jersey.

The seminar will discuss franchise issues which affect countless industries from automotive services to real estate agencies, from sports and recreation facilities to food chains. The presenters will discuss key issues you are likely to encounter as a franchise and distribution law practitioner as well as a discussion on recent developments and cases.

You can access additional information, including registration information, online here.
 

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Adam J. Siegelheim, member of Stark & Stark's Franchise Group, attended the 2011 International Franchise Expo's Annual Convention February 13-16, 2011 in Las Vegas, Nevada. 

 During the convention, Mr. Siegelheim interviewed Ricardo Roman, V.P. of Strategic Alliance for Caliper. Mr. Siegelheim and Mr. Roman discuss a presentation Mr. Roman recently gave entitled, "The Psychology of the Successful Franchisee." Mr. Siegelheim and Mr. Roman also discuss the value of franchisors utilizing assessment tools when meeting with potential franchisees. 

 You can listen to the podcast online here. 

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