LexisNexis® Legal Newsroom
    4th Circuit Says Trustee May Not Recover Assets Of Bankrupt Derivium Capital

    RICHMOND, Va. - A panel of the Fourth Circuit U.S. Court of Appeals on May 24 affirmed a bankruptcy court's ruling and said assets the trustee claimed were fraudulently transferred could not be recovered (Grayson Consulting Inc. v. Wachovia Securities $(In Re: Derivium Capital LLC$), No. 12-1518, Chapter 7, 4th Cir.; 2013 U.S. App. LEXIS 10529).

    Judge Partly Rules In Insurer's Favor In Suit Over $2.5M Bankruptcy Judgment

    SCRANTON, Pa. - A federal judge in Pennsylvania on May 28 entered summary judgment in part in favor of an errors and omissions insurer in a declaratory judgment action arising from a $2.5 million bankruptcy judgment against its insured, finding that the policy does not cover claims arising under the Pennsylvania Unfair Trade Practices and Consumer Protection Law (PUTPCPL) and that coverage extends only to claims occurring between Oct. 29, 2007, and Oct. 29, 2008 (Joan Hrobuchak, et al. v. Federal Insurance Co., No. 3:10-0481, M.D. Pa.; 2013 U.S. Dist. LEXIS 74160).

    Judge Trims Only Negligence Claim Against Bank From Predatory Lending Action

    CHARLESTON, W.Va. - A federal judge in West Virginia on May 28 held that a man sufficiently stated a majority of his claims against Quicken Loans Inc. and Bank of America in a lawsuit over the origination and servicing of his loan, finding only that he could not pursue a claim of negligence against the bank (Anthony O'Brien v. Quicken Loans Inc., et al., Nos. 12-cv-5138, 12-cv-5262, S.D. W.Va.; 2013 U.S. Dist. LEXIS 74363).

    Virginia Federal Judge Finds Tenant's Mold, Discrimination Claims Fail

    ROANOKE, Va. - A Virginia federal judge on May 23 adopted a magistrate judge's report and recommendation to dismiss a case filed by a tenant who alleged that she was discriminated against in relation to her race and mold growth in her apartment, finding that the tenant failed to submit evidence in support of her claim under the Fair Housing Act (FHA) (Yvonne Reeves v. Carey Campbell, et al., No. 7:13CV00001, W.D. Va.; 2013 U.S. Dist. LEXIS 73479).

    Federal Judge Stays Insurer's Coverage Action In Favor Of Insured's State Court Action

    CHARLOTTE, N.C. - A commercial general liability insurer's lawsuit regarding coverage for a construction defects action is stayed pending the outcome of a South Carolina state court action filed by the parties involved in the construction defects action concerning insurance coverage, a North Carolina federal judge ruled May 23 (Crum & Forster Specialty Insurance Co. v. Tripple J Framing Inc., No. 12-61, W.D. N.C.; 2013 U.S. Dist. LEXIS 73198).

    11th Circuit Affirms Decision For Doctor In Medical Malpractice Case

    ATLANTA - The 11th Circuit U.S. Court of Appeals on May 24 upheld summary judgment for a Florida doctor named as the defendant in a medical malpractice case, agreeing that a state prisoner failed to show that the defendant was deliberately indifferent to his medical needs (Elisames Harris v. Douglas Leder D.O., No. 12-12098, 11th Cir.; 2013 U.S. App. LEXIS 10485).

    Kodak: Expense Claim Should Be Denied Firm For Failure To Perform Its Duties

    NEW YORK - Bankrupt Eastman Kodak Co. on May 24 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York arguing that the bankruptcy court should not allow a $258,968.43 administrative expense claim asserted by a firm Kodak hired to provide services related to underlying patent litigation because the firm failed to perform its duties under the contract (In Re: Eastman Kodak Company, No. 12-10202, Chapter 11, S.D. N.Y. Bkcy.).

    Mass. Federal Judge Certifies Class Of Female Inmates Suing Over Strip Searches

    SPRINGFIELD, Mass. - A Massachusetts federal judge on May 23 certified a class of female inmates who allege that they were improperly videotaped by male correctional officers while they were being strip-searched in nonemergency situations (Debra Baggett, et al. v. Michael J. Ashe, Jr., et al., No. 11-30223, D. Mass.; 2013 U.S. Dist. LEXIS 73202).

    No Coverage Due For Water Infiltration Into Salt Mine, Kansas Federal Judge Says

    TOPEKA, Kan. - Because insureds did not notify an insurer of a claim for damages arising out of water infiltration into a salt mine until more than two years after discovering the loss, the insurer owes no coverage, a Kansas federal judge said May 22, noting that the policies require claims to be reported within 90 days of discovery of the loss (B.S.C. Holding Inc., et al. v. Lexington Insurance Co., No. 11-2252, D. Kan.; 2013 U.S. Dist. LEXIS 72418).

    Ga. Federal Judge Rules ERISA Preempts Claims; Order Certified For Appeal

    COLUMBUS, Ga. - A health plan's and plan sponsor's state law claims against a medical provider to recover benefits erroneously paid by the plan because of the provider's alleged fraudulent misrepresentations are completely preempted under the Employee Retirement Income Security Act, a federal judge in Georgia ruled May 22 (Aflac, Inc., et al. v. Richard Bloom, No. 4:12-CV-331, M.D. Ga.; 2013 U.S. Dist. LEXIS 72106).

    Rhode Island Federal Judge Finds For Providers In Health Care Contract Dispute

    PROVIDENCE, R.I. - A Rhode Island federal judge on May 22 found in favor of two health care providers in a contract dispute with a health insurer, finding that the plaintiff failed to establish that the treatment provided by the defendants was not a form of mechanical traction covered by the plan (Blue Cross and Blue Shield of Rhode Island v. Jay S. Korsen, et al., No. 09-317L, D. R.I.; 2013 U.S. Dist. LEXIS 72463).

    2nd Circuit Reverses; Creditor May Set Off Judgment She Owes Against Claim

    NEW YORK - A panel of the Second Circuit U.S. Court of Appeals on May 28 reversed and remanded a bankruptcy court's ruling and determined that a creditor was entitled to have a $226,000 judgment she owes set off by her claim against the debtor's bankruptcy estate (Sally Ogden v. Ronald Ian Chorches $(In Re: Bolin & Co. LLC$), No. 12-1310, Chapter 7, 2nd Cir.; 2013 U.S. App. LEXIS 10614).

    9th Circuit Affirms Judgment Against Man Convicted For Selling Microsoft Codes

    PASADENA, Calif. - A Ninth Circuit U.S. Court of Appeals panel on May 28 unanimously affirmed a man's conviction of wire fraud and violation of the Digital Millennium Copyright Act (DMCA) for unauthorized sale of Microsoft software product activation codes, finding no error in a lower court's judgment and its sentence of more than five years' imprisonment and $28,000 in fines (United States of America v. Adonis Gladney, No. 10-50170, 9th Cir.).

    Bausch & Lomb Unit Pleads Guilty, Pays $33.5M To Settle Criminal, Civil Cases

    BUFFALO, N.Y. - A near-defunct subsidiary of Bausch & Lomb Inc. on May 24 pleaded guilty to two federal felony counts of off-label promotion of a drug and paying kickbacks and agreed to settle a related whistle-blower lawsuit, to pay $33.5 million in criminal fines and civil penalties and to be excluded from participation in Medicare (United States of America v. ISTA Pharmaceuticals, Inc., No. 1:13-cr-99, United States of America, ex rel. Keith Schenker v. ISTA Pharmaceuticals, Inc., No. 1:07-372, W.D. N.Y.).

    Bottling Company Urges High Court To Consider NLRB Quorum Dispute

    WASHINGTON, D.C. - A bottling and distribution company in its May 23 respondent brief did not oppose certiorari and urged the U.S. Supreme Court to agree to decide whether President Obama's appointment of three members to the National Labor Relations Board in 2012 should be upheld (National Labor Relations Board v. Noel Canning, a Division of the Noel Corp., et al., No. 12-1281, U.S. Sup.).

    Florida Federal Judge Lifts Stay Of Seamans' Claims Against Cruise Line

    MIAMI - A Florida federal judge on May 24 lifted a previously imposed stay of case that was filed by cruise line workers who seek damages for allegedly withheld wages, dismissing the case so that the workers can appeal an order compelling arbitration of their claims (Kenneth Downer, et al. v. Royal Caribbean Cruises Ltd., No. 11-21948, S.D. Fla.; 2013 U.S. Dist. LEXIS 74135).

    Creditor: Bankruptcy Court Should Deny Cash Collateral For Bankrupt Laser Company

    FORT WORTH, Texas - A creditor of Primcogent Solutions LLC, a distributor of a non-invasive body contouring laser, on May 27 filed a brief in the U.S. Bankruptcy Court for the Northern District of Texas objecting to Primcogent's motion seeking cash collateral on grounds that the money should not be approved because the company is litigating a contract dispute with the supplier that makes Primcogent's business operation possible in the first place (In Re: Primcogent Solutions LLC, No. 13-42368, Chapter 11, N.D. Texas Bkcy.).

    U.S. Supreme Court Declines To Hear Planned Parenthood Funding Case

    WASHINGTON, D.C. - The U.S. Supreme Court on May 28 declined to reconsider the Seventh Circuit U.S. Court of Appeals' affirmation of a trial court's grant of a preliminary injunction against the Indiana State Department of Health in enforcing a state law stripping Medicaid funds from Planned Parenthood of Indiana Inc. because the agency provides abortions (Secretary of the Indiana Family and Social Services Administration, et al. v. Planned Parenthood of Indiana Inc., Nos. 12-1039, 12-1159, U.S. Sup.).

    Georgia Federal Judge Allows Company Extra Time To Identify Construction Expert

    ATLANTA - A federal judge in Georgia on May 23 allowed a party in a construction defects dispute involving a collapsed parking garage extra time to identify an expert witness after the death of its previously disclosed witness (Metromont Corp. v. Sirko Associates Inc., et al., No. 11-2407, N.D. Ga.; 2013 U.S. Dist. LEXIS 72853).

    Tribune: Claims Not Valid; $20M Related To Underlying Newspaper Case Has Expired

    WILMINGTON, Del. - The reorganized version of The Tribune Co. on May 24 filed a series of briefs objecting to assorted claims against the bankruptcy estate, most notably arguing that a $20 million claim asserted by the estate of Parren Mitchell, a former Maryland congressman, had expired (In Re: Tribune Company, No. 08-13141, Chapter 11, D. Del. Bkcy.).

    Texas Legislation Dismissing Asbestos Cases With Faulty Reports Signed By Governor

    DALLAS - Texas Gov. Rick Perry on May 24 signed legislation dismissing asbestos claims supported by inadequate medical reports. The bill becomes effective Sept. 1, 2013.

    Federal Magistrate Judge Dismisses Counterclaims In Failed-Bank Action

    SAN JUAN, Puerto Rico - A federal judge in Puerto Rico on May 22 dismissed the counterclaims brought by borrowers in a mortgage foreclosure suit filed by a bank that subsequently failed, finding that the borrowers did not exhaust the administrative claims process pursuant to the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA) before bringing the counterclaims (Federal Deposit Insurance Corp. v. Empresas Cerromonte Corp., et al., No. 10-1623, D. Puerto Rico; 2013 U.S. Dist. LEXIS 74120).

    Some Cloud-Computing Patent Infringement Claims Against Amazon, Oracle Dismissed

    WILMINGTON, Del. - A Delaware federal judge on May 24 granted in part motions to dismiss infringement claims brought by a patent holding company against Amazon.com Inc., Oracle Corp. and Rackspace Hosting Inc., finding that the patent holder failed to plead facts supporting induced infringement (Clouding IP LLC v. Amazon.com Inc., et al., No. 1:12-cv-00641, 1:12-cv-00642 and 1:12-cv-00675, D. Del.; 2013 U.S. Dist. LEXIS 73655).

    Coverage Owed For Damages Caused By Drain Blockage, N.Y. Justice Determines

    CORTLAND, N.Y. - An insurer owes coverage for damages sustained when waste water flooded two insured apartments because the insurer failed to prove that the damages were caused by a blockage that originated off the insured premises, a New York Supreme Court justice said May 23 (Michael J. Pichel v. Dryden Mutual Insurance Co., No. 2011-0449, N.Y. Sup., Tompkins Co.; 2013 N.Y. Misc. LEXIS 2185).

    California Appellate Panel Upholds Overtime Verdict For Assistant Store Manager

    LOS ANGELES - A California appellate panel on May 23 upheld a $26,184.60 award of overtime pay for a grocery store assistant manager who was found to have spent more than 50 percent of her work hours performing "nonexempt" tasks (Linda M. Heyen v. Safeway Inc., et al., No. B237418, Calif. App., 2nd Dist., Div. 4; 2013 Cal. App. LEXIS 409).