New York Business Litigation Attorney Blog

Small Businesses Have Power to Fight Employee Lawsuits

Wed, 15 May 2013 15:10:21 -0500

In the course of our many years as business lawyers, we have represented clients from both sides of the aisle in employment disputes.

Having this kind of unique perspective is of great benefit to those who trust us to handle their cases. We're intimately familiar with negotiation tactics and bottom lines for both employers and embattled employees.

One thing we've noted in all these years is that when it comes to companies, especially smaller firms, there seems to be a tendency to simply settle an employment case rather than have it played out in a courtroom. Some simply view it as the cost of doing business, regardless of whether they've done anything wrong.

But it's important to understand when this might be a mistake.

First, it bears mention that consulting with an experienced attorney at the outset of your business formation - and then periodically each year - may help you avoid many of the litigation catalysts that may arise in the first place.

In addition to that, your attorney should be involved in the process from the very moment it comes to your attention. In some cases, business are blindsided. Other times, there may have been some significant foreshadowing. When you can, get your attorney involved early.

The other thing to determine is whether there was in fact any wrongdoing.
You don't have to necessarily break the law to get sued. However, if you are being sued, it's a good idea to know - and to be able to prove - that you have done the right thing. In cases where there may have been misconduct - or at the very least the strong appearance of such - it may be worth engaging in a discussion over a settlement agreement. But that's not a conclusion you should reach hastily. You should be apprised of all your options and the potential risks of each.

You may also want to consider out how much you can afford to pour into the case, the reputation of the plaintiff and the potential distraction of litigation.

Some reasons you might consider fighting it out:

The case is frivolous. You might need to do a fair amount of research and investigation to even determine whether that is the case, but if the case is frivolous, a settlement shouldn't be your first chose.

Doing so would prove a point. Employees are well aware that many companies would rather settle. Fighting a case through to the end might send a powerful message that you are not willing to simply pay up on every claim. It may be a good deterrent for such cases in the future.

There is a fair amount of bad press. These situations must be handled delicately - and your attorney is usually the best person to speak to the media on your behalf. But settling in some cases could make the wrong impression, with the public presuming that you're wrong. Even if the only reason you're doing it is to be able to move on, the media might not see it that way.

To be sure, the decision of whether to "fight or flight" is not one you should take lightly. You should never assume that you have been pigeonholed into a single option.

Education Fraud Case Declined By State High Court

Fri, 10 May 2013 14:20:27 -0500

The New York Supreme Court has rejected the first of more than a dozen lawsuits brought by recent law school graduates, alleging their school had lured them to enroll under fraudulent pretenses.

Our fraud litigation attorneys were disappointed with

the ruling, as it likely means the remaining 14 cases will not move forward.

The case, Gomez-Jimenez v. New York Law School had alleged that school had misrepresented and/or lied about how successful alumni were in finding employment after the completion of their education. Plaintiffs had been seeking a collective $225 million.

Among the claims made by the school at the time students enrolled was that between 90 and 92 percent of graduates from the school had secured employment within nine months. What the school allegedly failed to mention was how many of those positions were temporary or part-time or how many of them had nothing to do with a law degree. Lumped in with that 92 percent were graduates who were working as coffee shop baristas and in retail sales - jobs that don't require a law degree and won't even begin to help make a dent in those astronomical law school loans.

If this case sound familiar, that's probably because you may have heard it before. A New York County judge had dismissed the action back in the spring of last year, saying that the career woes of the plaintiffs could be pinned more on the economic downturn than on the claims made by the school.

The case was appealed. However, the appellate court found that while the law school had been "less than candid" about the career paths of its recent graduates, the dismissal was still appropriate.

The plaintiffs had hoped the state's high court would agree to review the matter, but now that does not appear likely. A similar lawsuit involving Albany Law School was dismissed by a trial court as well, though that case is pending appeal. Decisions are also pending in cases against the law school at Hofstra University and the Brooklyn Law School.

Representative lawyers had said that while they were disappointed with the court's decision, one of the latent goals of the entire process was realized: law schools on the whole are becoming more transparent in how they operate and in what they promise.

Part of that has been the American Bar Association's response to this type of litigation, which has been to require schools to submit more in-depth information regarding alumni employment for publication of its annual law school rankings, which is compiled each year in conjunction with U.S. News & World Report.

The attention that all this has garnered also prompted a number of U.S. senators to speak out critically against deceptive law school practices.

Although courts in New York State have generally not favored students in these matters, they had a moderate level of success elsewhere. In New Jersey, for example, a federal judge declined just last month to dismiss a similar case, saying that it was plausible that the claims of the alumni had merit.

Parents: Disabled Students Face Discrimination, Abuse

Thu, 02 May 2013 15:40:50 -0500

School is supposed to be a nurturing haven of learning and a refuge of safety.

Sadly, our education lawyers know this is not always the case. It's troubling enough when children are cut down by their peers. But when it comes from teachers, administrators and bus drivers, it can be devastating.

Parents in New York's Garden City have filed a lawsuit in federal court, alleging the public school system has practiced widespread discrimination against disabled children. It is one of a number of similar cases cropping up across the country.

In this case, three mothers say the district treats children who have autism like second-class citizens.

In one case, a former female student with a neurological disorder who is able to communicate with the assistance of a machine, was allegedly told by public school administrators that she would not be able to finish high school. Her mother refused to accept that answer. She had to fight for it, but her daughter did eventually graduate high school, and is now receiving a college education.

By federal law, the public education system must provide an education to all students - regardless of the unique challenges they face. However, these mothers say when it comes to disabled children, the school does not make equal education a priority.

As our education lawyers well know, the process for these parents often involves an ongoing string of meetings and hearings. It's wise in these cases to bring an advocate with you, to ensure your child is receiving the best possible education - and that the school is abiding by the law.

The mothers in this case speculate that the schools are reticent to provide equal education for their kids because their children's test scores, like all other students, are tied to overall school ratings and therefore state and federal dollars.

That doesn't make it acceptable.

Down in Florida, another federal lawsuit has been filed on behalf of a young female student who suffered from a neuromuscular disorder that made it difficult to sit up straight. She died on a school bus after suffocating; the lawsuit indicates bus employees failed to take action or even call 911. Instead, they reportedly followed "protocol" by trying to reach a supervisor. The lawsuit alleges a series of deaths of disabled children within the district dating back to 1999, revealing a pattern of disregard for the needs of disabled children.

In another case out of a Chicago suburb, parents there are suing the school district alleging that a school bus aide slapped an autistic male student. Parents might never have known of the incident had they not put a camera on his backpack when they noticed he seemed afraid to board the bus.

On that tape, the aide reportedly began yelling at the boy to get his hands out of his pocket, and then began slapping and hitting the child and threatened to break his fingers.

No other employee on the bus attempted to step in and stop the abuse, nor was it ever reported to the aide's superiors.

If you believe your special needs child is being discriminated against or abused, call our experienced attorneys for advice on how to proceed.

Employment Discrimination Alleged for HIV-Positive Status

Fri, 26 Apr 2013 13:34:03 -0500

Employment discrimination takes on many forms, be it sex or sexual orientation, race, ethnic origin or religious affiliation.

Our employment attorneys recognize that sometimes these actions can be attributed to an employer's ignorance of the law. Other times, it is a flagrant disregard for it.

Interestingly, the kind of discrimination being alleged by a former New York City car dealership finance employee would likely not have even been considered a form of discrimination a few decades ago. But because of our expanded understanding and exponential medical advancements in that time frame, there is no reason why an employer should view the following as an acceptable cause of termination: HIV-positive status.

According to media reports, the 43-year-old former employee filed suit with the New York Supreme Court against a dealership in Queens, seeking $4 million in damages.

Specifically, the former worker is alleging discrimination on the basis of sexual orientation and retaliation by the employer and individual liability for discrimination on the basis of his sexual orientation by three former co-workers.

The plaintiff said that he was hired by the dealership last November, at which time he had about two decades of experience in the automotive industry. At his new position, he earned roughly $10,000 monthly.

Five years ago, the plaintiff said he learned that he was HIV-positive. In the interim, he'd had two other employers, both of which knew of his condition and took no issue with it.

At this office, however, he says it was different.

He said he did not make a secret of the fact that he was homosexual, but neither did he make it a topic up for routine discussion.

Despite having this knowledge, several co-workers - including the general manager of the dealership - allegedly made extremely offensive homophobic remarks, spitting out slurs and discriminatory remarks.

The defendant said he tried to ignore it, but it deeply bothered him.

Then sometime around mid-March, the plaintiff was conversing with the general sales manager when the latter indicated that his brother was HIV-positive, and that due to this, he was no longer welcome at family functions or around his children. The defendant said at that point, he revealed his own HIV-positive status, attempted to dispel the myth that HIV-positive people are dangerous.

His revelation was met with silence and a blank look.

Two days later, the plaintiff was called in for a meeting with his superiors - including the general sales manager. At that time, it was alleged that there was a "problem" with the plaintiff's work - though none had been hinted to at any point prior. He was then promptly fired.

With no health insurance and only a month's worth of anti-viral medication left, this discrimination poses a threat to his health as well as his finances.

The U.S. Equal Employment Opportunity Commission reports that there were 200 allegations of discrimination on the basis of HIV last year. That accounted for .08 percent of all disability claims filed in 2012 under the Americans with Disability Act. Compare that to 1997, when there were 323 cases, or nearly 2 percent of all cases that were tracked by the EEOC.

Among some of the other medical conditions for which the EEOC received disability complaints about last year:

Anxiety disorders (6.1 percent);

Asthma (1.5 percent);

Cancer (3.7 percent);

Depression (6.7 percent);

Diabetes (4.8 percent);

Hearing impairment (3 percent);

Back injuries (8.9 percent);

Former School Employee Alleges Retaliation, Seeks Whistleblower Status

Mon, 22 Apr 2013 11:57:54 -0500

When video publicly surfaced showing Rutgers University Coach Mike Rice engaging in abusive behavior toward his players, administrators took swift action to have him fired.

But as our New York employment lawyers know, the public release of those recordings wasn't the first that administrators had been made aware of them.

In fact, the school knew about problems with the coach since at least last year. Former nine-year National Basketball Association player Eric Murdock, who worked as the university's director of basketball player development from 2010 to 2012, said he had informed the school's athletic director, Tim Pernetti, about the alleged abuse on numerous occasions.

The allegations included assertions that Rice was shoving players, grabbing them, hurling basketballs at them and launching homophobic slurs at them.

Yet, Murdock says, nothing was done.

Then, Murdock handed over a video recording proving the alleged abuse to Pernetti.

Still, no action was taken against Rice.

Instead, Murdock was fired.

In the Murdock v. Rutgers et. al. civil lawsuit filed recently, Murdock noted that bullying had been a major problem on the Rutgers campus during his tenure there, most notably with the high profile incident of an incoming freshman who took his life and the life. Ultimately, a roommate was criminally prosecuted for bullying the victim on the basis of his homosexuality.

In the wake of this tragedy, the state had adopted anti-bullying laws and the school, too, had instituted a new policy that was to protect students against harassment, bullying, defamation and intimidation.

Yet somehow, the basketball coach seemed immune to the requirement to abide by these rules. Not only did Rice's actions violate school policy, Murdock says, they broke the law. Murdock said that in all the years of his career, he had never before experienced or witnessed the kind of abuse that Rice heaped on his players.

The school, rather than punish Rice, punished Murdock - which is a form of employment retaliation.

Murdock says he was abruptly fired in the summer of 2012, after he had put university officials on notice about Rice's actions. Murdock says the firing was initiated under the false pretense that his contract wasn't being renewed for the following school year.

Murdock says a meeting was arranged in late November for university officials to further discuss Murdock's allegations regarding Rice. At that time, the university was provided with the video evidence of the abusive conduct. However, Murdock said the school officials revealed at that meeting that they had known about Rice's conduct all along, as every practice was video-recorded.

Yet, confronted with the evidence form Murdock, the school chose to suspend Rice and fine him $50,000. No investigation was carried out.

It wasn't until that recording was made public that the university actually took action.

Now, Murdock is seeking whistleblower status. He claims that his reports of Rice's wrongdoing were protected speech, and that the administration's response to fire him amounts to illegal retaliation.

Whistleblower status is a very specific type of protection from retaliation that one can seek for publicly revealing misconduct, dishonesty or illegal activities in government or within a private company or organization.

If you are concerned that you may be retaliated against for speaking out for the right thing, contact our law offices today.

New York City Bans Employment Status Discrimination

Mon, 15 Apr 2013 08:40:29 -0500

In the wake of America's economic crisis, many workers through no fault of their own were being overlooked and outright discriminated against for employment.

One ad in particular sparked national outrage when a company in Texas indicated that the unemployed need not apply.

Now, our Great Neck employment lawyers know it's been little more than a month since New York City passed a new law barring businesses from rejecting job applicants solely on the basis of unemployment. The measure passed 44-4 and specifically outlaws help wanted ads requiring that potential job candidates be currently employed.

The idea of course is to help New Yorkers get back on their feet. In New York state, our unemployment rate is 8.2 percent. It's markedly higher in New York City at 9.1 percent. Those numbers are skewed for minorities - 13.6 percent for African Americans and 10 percent for Latinos.

A survey of hiring managers last year found that unemployed job candidates were viewed as less qualified, even when they had the exact same resume as someone who was currently employed. This provided insight as to why unemployment begets unemployment. It's not a matter of laziness. It's a matter of opportunity denied on an illogical basis, and what's more, it hurts us all as it prolongs economic recovery.

Council support was able to override a veto by Mayor Michael Bloomberg, who argued that such a measure would hurt businesses who are already fighting to stay open. The biggest concern, he said, is that a flood of "frivolous litigation" would hurt more than it would help.

One would have to ask - help and hurt whom? It's only "frivolous" until you are the one who is discriminated against for a layoff or job loss over which you had no control. When you are the one who is qualified, able and eager to work, yet you are struggling to scrape by because no one will hire you - it's not so frivolous anymore.

What's more, other places that have passed very similar measures (New Jersey and Oregon) haven't noted a great uptick in litigation. One would hope that's because businesses are taking heed.

In New York City, the new law holds that an employer found in violation could be required to pay a civil penalty of up to $250,000, not including statutory fines and attorneys' fees.

Still, there is some leeway provided for employers. Companies are allowed to consider an applicant's unemployed status as long as there is a substantial, job-related reason to do so.

A similar measure at the federal level was proposed by President Barack Obama in 2011, with the President saying that requiring a candidate have a job to get a job "makes no sense." It wouldn't have made employment status a protected class, like how we view race or sex or religion, but it would have given unemployed job candidates a leg up. However, the bill, titled the American Jobs Act, ultimately faltered in Congress.

New York City applicants who feel they have been discriminated against on the basis of their employment status can file a complaint with the city's Human Rights Commission, and should contact an experienced employment lawyer as soon as possible.

New York Business Start-Ups Should Invest in Legal Advice

Sat, 13 Apr 2013 10:28:05 -0500

New York's new business sector has exploded in recent years, with 2011 seeing an 86 percent increase in the number of start-ups as compared to 1991.

Our Great Neck small business lawyers know that New York has always been a hub of innovation, so in many ways, this is no surprise.

The Center for an Urban Future reported that the Bronx in particular is leading the way, with the number of newly-incorporated businesses climbing from 1,159 back in 1991 to 4,690 in 2011 - an eye-popping 305 percent increase.

What we want to ensure is that these new firms are equipped to handle whatever legal obstacles come their way.

In analyzing date culled by the New York State Department of State, researchers learned that the rate of new businesses increased every year up until the housing crisis in 2007, at which time it dropped sharply (except in the Bronx, where it still rose 5 percent). But the numbers have begun to bounce back since then, and new business formation has jumped nearly 10 percent between 2009 and 2011.

While the Bronx has made great strides, it isn't even the No. 1 job-generating borough. Manhattan holds 35 percent of all new businesses (it held 52 percent in 1991), while Brooklyn held 35 percent, Queens 25 percent, Bronx 7 percent and Staten Island 4 percent.

The tech industry is a big part of this, but many other models have thrived as well in recent years. At the very least, you will need an attorney to ensure all the paperwork is properly filed, that your are in good standing with the IRS and that you haven't overlooked any potential legal liabilities.

In the long-term, you will need someone with whom you can trust with your firm's most sensitive legal issues. You need to be confident of his or her legal experience and skill and also comfortable in confiding.

In exploring whether an attorney is a good match for you and your new company, consider the following questions:

Question the attorney's experience within the industry. Areas of business including franchise agreements, intellectual property and service contracts often require a heightened level of knowledge.

Ask about references. While many lawyers value client confidentiality, a seasoned attorney should be able to give you at least one or two satisfied clients willing to vouch for the value of their services.

Learn whether there are any conflicts of interest that could be relevant, such as if the attorney is working with a former business partner or competitor.

Ask about typical communication policies. How long does he or she take to get back to clients? Does he or she prefer phone, e-mail or face-to-face correspondence? Make sure your lawyer's communication style will mesh with your needs.

Report: New York Auto Insurance Fraud Rampant

Wed, 10 Apr 2013 09:38:15 -0500

A new report from the National Insurance Crime Bureau indicates that one out of every three auto insurance claims made in New York City is fraudulent. It's one of the top cities for allegedly fraudulent claims potentially linked to organized crime.

Our New York City insurance fraud lawyers know that insurance agencies, and auto insurance agencies in particular, are cracking down more than ever on insurance fraud. And in light of information that false auto insurance claims add approximately $240 million to insurance premiums just in New York City alone, the whole thing is pitting neighbor against neighbor - literally.

The New York Post recently reported that Staten Island residents are flooding lawmakers to tip them off to neighbors who are registering their vehicles out-of-state illegally so as to reduce their auto insurance costs. New York has the fourth-highest car insurance rate in the nation.

In Brooklyn, for example, the average insurance premium is $2,000.

The New Yorkers Stand Against Insurance Fraud reports that more than one-tenth of all vehicles owned by New Yorkers are registered out-of-state for this reason.

Our New York legal team has ample experience in representing both insurance carriers and policy holders, so we bring a unique perspective to the table that ultimately benefits our clients. As of right now, the enforcement on out-of-state registrations is essentially non-existent. State legislators are currently working to draft a measure that would change that.

But it's worth noting that registering your vehicle out-of-state is far from the only type of auto insurance fraud in New York.

One of those involves third-party repair shops and counterfeit airbags. Let's say you are in a crash. You take your vehicle to be repaired, your insurance picks up the tab. However, you might only later find out that the airbags in the vehicle are counterfeit - meaning the insurance company has paid for junk and the driver is left with a vehicle that isn't safe.

Another common type of auto insurance fraud is in the form of staged accidents. The NICB reports that there has been a more than 100 percent increase in this type of action in the few short years between 2008 and 2011. In many cases, two drivers will work in a team to involve another unsuspecting person in an accident so that they can collect the insurance money.

Some unsuspecting victims have fallen prey to agent fraud. This is a form of fraud whereby the insurance agent pockets a consumer's money, yet doesn't actually establish the insurance. The consumer only finds out about it when they are involved in a wreck and find out they aren't covered. Another form of this is something called sliding, in which an agent may bulk up your plan with services or features you don't want and for which you didn't ask. This boosts the agent's commission, but costs the consumer several hundred dollars annually.

No matter what your situation or whether your are a policy holder, body shop or an insurance carrier, we are here to fight for your rights.

Mom Sues NY School for Failing to Protect Daughter from Bully

Fri, 05 Apr 2013 14:56:06 -0500

Parents of children with disabilities are fighters and advocates from the time they are born.

Our Great Neck education lawyers know those battles have only just begun when the child reaches school age.
Many times, you are up against a district that may be providing substandard services and lessons, or is failing to provide the appropriate accommodations. Other times, you may learn the district isn't doing enough to protect your child from a number of potential harms.

The latter scenario is what one Brooklyn mother is up against, after her 13-year-old disabled daughter, who was mercilessly teased and bullied, was one day pushed by a peer from a moving bus and into oncoming traffic. It's a miracle she wasn't killed. The girl did however suffer a broken collarbone and had to be rushed to the hospital. In addition to being severely injured, the girl was also incredibly frightened and embarrassed by the ordeal, which the mother contends would not have happened had the school district taken action to curb the bullying before it got so out-of-control.

The mother has filed a notice of intent to sue the New York Department of Education in connection with the incident. The bus was reportedly staffed with one aide and a driver, neither of whom are facing any disciplinary action by the district.

The district has said the student believed to have pushed the girl has been forbidden from taking the bus and "will receive appropriate discipline."

Yet the mother says she had informed school officials for months that a group of children at the school was harassing her daughter, and she was deeply concerned for her safety. She credits God with saving her daughter, but says the district needs to ensure such an incident never happens again.

The ordeal that day began when one of the girl's classmates spit at her. Another threw her own school books at her.

The aide then instructed the bullied girl to move to the back of the bus so that she could get away. However, once there, one of the boys in the group - who reportedly had a history of violence both with other students and with this girl - walked back, opened the back door of the bus and pushed her out. He fell out along with her.

Said the girl later, "I thought I was going to die."

Bullying is not a new situation in schools. In fact, it's one they have been dealing with for some time. In 2011, the U.S. Department of Education released a statement saying that schools have an obligation to intervene to address harassment, online or on campus, when administrators know about it or reasonably should have known.

The department further defines bullying as unwanted and aggressive behavior among school children that involves a perceived or real imbalance of power. It could be verbal (teasing, inappropriate sexual comments, taunting, threatening, name-calling), social (purposeful exclusion, spreading rumors, public embarrassment) or physical (hitting, pinching, kicking, spitting, pushing, tripping, damaging property or making rude gestures).

If your child has been injured by a bully and school officials refuse to address the situation, we can help.

New York Paid Sick Leave Requirement on Table, Unions Split

Mon, 01 Apr 2013 13:29:39 -0500

The New York City Council appears poised to pass a measure requiring all city employers, public or private, of more than 15 employees to provide at least 5 sick days to workers.

Our New York City employment lawyers understand that the bill is likely to pass, despite the pledged veto of Mayor Michael Bloomberg and criticism from at least two major unions voicing concern that the new law won't go far enough.

The measure is expected to affect some 600,000 New Yorkers. Businesses with fewer than 15 workers won't be required to offer paid leave, but will need to give at least five days of unpaid sick leave. Regardless of whether they offer paid or unpaid leave, employers will be forbidden from firing workers who take that time off.

Examples of why this law is necessary abound. Take the case of a couple whose teen daughter contracted a blood infection and required hospitalization. The couple also had a newborn, who had to be left in the care of the father while the mother was in the hospital with their teen. The father was fired from his pizza delivery job for taking those two days off. As the family's primary wage earner, the effect was financially devastating.

As written, the law would take effect April 1, 2014 for companies with more than 20 employees and Oct. 1, 2015 for firms with 15 or more. A provision was written into the bill that holds it will not be enacted if the city's economic health, as measured by the Federal Reserve Bank, falls below the levels measured as of January 2012. Currently, the city has a 9.1 percent unemployment rate.

Part of the concern expressed by the mayor and others is that while the measure is well-intended, it may actually result in many low-wage workers being laid off as smaller companies struggle to shoulder the cost of the new requirements. That was essentially what happened in San Francisco when a similar measure was passed there six years ago. In the immediate aftermath, research showed, nearly 30 percent of the lowest-paid workers were either laid off or suffered a reduction of hours.

But of course the ultimate goal is to protect workers from being fired simply because they have suffered an illness and can't make it to work. In that regard, representatives from the building services and health care unions say the new law doesn't go far enough. Most workers, they say, will fall ill more than five days out of the year and should be shielded from the financial repercussions.

As the measure was originally written, companies with more than 20 workers would have had to offer nine paid sick days throughout the year. However, that number was later reduced to five as part of a compromise in an effort to get the measure passed.

Still, advocates say that the move could serve as as a bellwether regardless, given the size of New York's workforce.

However, given the resistance that so many businesses have put up, we expect there will be some level of intimidation discouraging workers from actually taking those sick days. Firms should be put on notice that such action could result in swift legal action, should workers seek to pursue it.

New York Consumer Lawsuit Filed Against Furniture Company

Fri, 28 Dec 2012 08:01:25 -0500

A New York furniture company has been ripping off consumers of funds totaling hundreds of thousands of dollars, according to a lawsuit filed by Attorney General Eric Schneiderman.

Our New York consumer law attorneys understand that the biggest problems occurred as FWS Home Furnishings was spiraling deeper into debt, closing in October without warning. Ultimately, this left many customers who had made advance or down payments with no furniture - and no refunds.

Stock has been sold during a foreclosure auction, and a developer is planning to snatch up the store property on Elmwood Avenue.

Schneiderman's Buffalo branch investigation revealed that the total consumer losses is likely somewhere in the range of $250,000. While this might not seem like a great deal of money in the grand scheme of business deals, particularly when spread out among many victims, the fact is that people save up for years to make these type of big-ticket purchases. To be completely left out in the cold - with little recourse to recover their money - is unconscionable and, based on the facts so far provided, illegal.

New York Code, Article 22-A, Section 349, covers deceptive acts and practices. This statute holds that deceptive acts or practices in the conduct of any business, commerce or trade or in the providing of any service are unlawful. Deceptive practices are generally held to be any business practice that involves fraud or misrepresentation or unconscionable or oppressive acts. If the court finds that the defendant willfully violated this law, it may increase the award damages to an amount that equals three times the actual damages, plus attorney's fees. Additional awards may be given if the victim is elderly.

Although the furniture store had been in business for more than 30 years, the most recent two owners purchased it in the spring of 2010. Under new ownership, the business began hemorrhaging funds. Just this year alone, the company is believed to have lost more than $400,000. This prompted creditors to effectively shut it down.

The Attorney General's investigators later learned that whenever the company made an order on behalf of a customer, the company required customers to make advance payments. However, the company didn't separate those funds into a different account. Instead, it spent the money before merchandise was even delivered. Had the company continued to stay open and thrive, this may not have been a major issue. But when FWS did close, it's estimated there were about 700 open orders in which consumers had made some sort of payment, but hadn't received the merchandise. In all, this amounted to roughly $420,000.

Since then, some of those customers have been able to either stop payment they had made with credit cards or were able to actually get the furniture for which they had paid.

Ultimately, the Attorney General's office is hoping to get the two former owners to repay the money they owe to the remaining customers, and to bar the owners from opening another business in the state unless they post a $500,000 performance bond. Additionally, Schneiderman's office is requesting a temporary restraining order that would prohibit the company and owners from destroying any business records or transferring any funds.

NYC Class Action Employment Lawsuit Pits Interns Against Hearst

Mon, 24 Dec 2012 08:34:47 -0500

A New York City employment lawsuit filed by a former intern at Harper's Bazaar has been granted class action status, with some 3,000 people eligible to join in a fight alleging that intern employment practices at Hearst Corp. violated state and federal labor laws.

The suit alleges the company aggressively worked unpaid interns, who routinely worked overtime without compensation and were critical to the company's operation. Yet, it was rare for the firms to actually extend a job offer or even recommendation. Hearst has begun fighting back, e-mailing thousands of former interns in an effort to find some willing to testify regarding the value of their intern experience.

Our New York employment attorneys understand the decision rendered in this case - and we could see one as early as next year - will have a greater impact on some industries than others. That's because some industries, such as fashion, film and media, have always tended to rely a bit more heavily on the work of interns as part of daily operations.

These are cut-throat industries, with a fierce level of competition for even the unpaid positions. For a long time, these companies have probably felt as if that insulated them from legal action.

Speaking out against these companies' practices would inevitably lead to a person being black-balled from the industry. And in fact, following the filing of this lawsuit, many in the fashion and publishing industry have been highly critical of the interns. Among those big names are CNN's Anderson Cooper and Vogue's Grace Coddington.

The federal Fair Labor Standards Act holds that interns who work at private, for-profit firms and who qualify as employees, as opposed to trainees, must typically be paid a minimum wage, plus overtime for any hours they work over 40 a week.

However, there are some situations in which interns may be unpaid. In most cases, in order to meet this standard, the following criteria must be met:

The internship, despite including actual operation of the employer's facilities, is more akin to the training that would be received in an educational environment;

The internship experience is for the benefit of the intern;

The intern doesn't displace any regular workers, but instead works closely under the supervision and guidance of existing staffers;

The employer provides training, yet derives no immediate advantage from the intern's work, and in fact, may be impeded by their presence;

The intern understands that he or she isn't entitled to receive a job when the internship is done;

Both the intern and employer are on the same page about the fact that the position is unpaid.

In this case, in addition to Harper's Bazaar, interns from Redbook, Marie Claire and Esquire have also joined the suit. They are seeking back wages, overtime and other damages.

It's not expected that this suit, if successful, would end the unpaid internships altogether. However, we understand the goal is to prompt companies to change their policies so that interns can be paid rather than provided school credit. A number of media organizations have already done so, including Fox and Gawker Media.

New York Civil Rights Violations Alleged by State Prisoners

Sat, 22 Dec 2012 13:43:34 -0500

New York State is being sued by a civil rights advocacy group on behalf of state prisoners who were reportedly banished to long periods of solitary confinement for infractions that were petty and nonviolent.

Our New York City civil rights attorneys understand that some of the alleged violations included having too many cigarettes or not properly cleaning a cell. Guards were given a vast amount of discretion in terms of what infractions would trigger a solitary confinement stint. This led to blatant discrimination, with black prisoners in particular punished with isolation at a disproportionately inflated rate than prisoners of other races.

These stints inevitably caused prisoners to suffer severe psychological and physiological damage, according to the state chapter of the Civil Liberties Union. Solitary confinement is a form of punishment in which a prisoner is relegated to a small cell with little to no human contact or stimulus. They are given no more than one hour a day outside of the cell to exercise.

A 1995 study conducted by Harvard Medical School Psychiatrist Dr. Grassian found that even a few days of solitary confinement will affect brain scan readings to show abnormal patterns reflecting delirium.

Additionally, German researchers have even given a name to the psychiatric syndrome associated with long periods of solitary confinement: Ganser's Syndrome. It's characterized by massive amounts of anxiety, hyperresponsiveness to stimuli, vivid hallucinations of all kinds, acute confusion, sudden, violent outbursts, perceptual distortions and paranoid delusions.

As the Civil Liberties Union characterizes it: Torture.

The plaintiff in this case reportedly was given solitary confinement punishment on two different occasions - once for possessing diet pills and another for filing a false lien against D.A.'s office members who had prosecuted him. In all, his isolation totaled two years.

He was serving 16 years in Attica for rape.

Just before filing the suit, the Civil Liberties Union released a report in October called, "Boxed In," which revealed that in addition to imposing extensive solitary confinement punishments, corrections officers would routinely deprive prisoners of showers, exercise and haircuts for innocuous offenses such as "poor demeanor."

While the corrections department requires that such orders be reviewed every day, they have yet to cap the maximum amount of time a prisoner can spend in isolation. Plus, despite the requirement that such orders be reviewed, the organization found several incidents in which this was not done, in violation of its own regulations.

Some prisoners in isolation were deprived of edible food as a form of punishment -- referred to by staffers as a "restricted diet." This went on for up to a week before a disciplinary hearing - which determines guilt or innocence - was even held. This diet consists of a brick of vegetable-bread matter, cabbage and water.

The group also found that self-harm and suicide rates for these prisoners, as opposed to those who are serving their time in the general population, are much higher. However, rather than providing these prisoners with psychiatric care, they punish them for incidents of self-harm - with more solitary confinement. One prisoner, who had spent more than two decades in and out of extreme isolation, had a long history of cutting himself. After one incident, his punishment was four months of solitary confinement.

NYC Tight-Lipped On Employment Lawsuit Settlements

Thu, 20 Dec 2012 12:17:19 -0500

Our New York City employment litigation attorneys understand that city leaders have quietly adopted a policy of shielding from public view the dollar figures it pays to settle the majority of lawsuits filed against either itself or its employees.

The New York Times reports these figures were at one time always included in courthouse documents. However, about three years ago, the city began notifying plaintiffs who had filed suit that if they wanted their labor and employment case settled, one condition was that the dollar amounts would remain confidential.

Then last month, that policy was expanded to include any lawsuits that were filed against the city's police department or its members.

Of course, the settlement amounts are technically public record, available through a formal Freedom of Information Act request.

We view this action by the city with skepticism for several reasons. One is that the new policy now requires potential litigants to obtain the city's permission for information that once could be obtained with neither the city's knowledge or permission. Essentially, it sets them on alert for a pending action, which can sometimes be harmful to a plaintiff attorney's strategy. Additionally, while it has historically been typical to maintain confidentiality in settlements involving private parties, a city government does have an obligation to offer a greater level of transparency.

First Amendment attorneys have been quick to note that this shift is not consistent with the major issue of the public's right to know. Even if it doesn't violate the letter of the law, it certainly violates the spirit.

This is important not only from a taxpayer point-of-view, but also from the strategic perspective of knowing how the city is compensating victims of misconduct or abuse perpetrated by its employees.

A recently cited case involved a man who was wrongly arrested for gambling based on falsified police reports. Inside sources indicate the man settled for $20,000 - but only on the condition that the plaintiff agreed to omit the amount of payment from courthouse records.

The Times reports this was just one of thousands of lawsuits that are filed against city employees each year. During the 2011 fiscal year, the city reportedly spent nearly $665 million on awards or settlements. It was slightly less this fiscal year, with the total settlement amount reaching about $585 million.

The city said that the new policy started when a federal judge overseeing a police misconduct case stated she was uncomfortable releasing the amounts. However, it's not clear why.

What is clear is that a government that is not interested in being forthcoming about the actions taken to right its wrongs is likely not all that interested in actually righting those wrongs at all.

NYC Sandy Insurance Claims Fast-Tracked By Lenders, City

Tue, 18 Dec 2012 13:05:03 -0500

We are now more than a month removed from Hurricane Sandy, but the city has a long way to go in terms of untangling the insurance nightmare that has unfolded in its wake.

Our New York City insurance lawyers understand there are more than 360,000 Sandy victims who have pending insurance claims to sort through. However, despite efforts to fast-track the process, we suspect that there will be many New Yorkers who will be unsatisfied with the outcome of the settlements - or lack thereof - offered by the insurance companies.

If your insurance company is trying to avoid paying up, you need the experience of a skilled insurance law attorney - someone who will fight for you so that you can begin the process of rebuilding. in many cases, these companies send out low-ball offers, counting on the delay and hassle of putting up a fight being enough to induce a homeowner to settle for less. We are here to tell you in such cases you are going to be better off consulting an attorney.

Late last month, Gov. Andrew Cuomo said that he had met with top insurance company executives to prompt an expedited claims process. As with any insurance claim, an adjuster must inspect the damage to the home or business before the amount can be paid. Previously, the deadline for the insurance adjuster to conduct the inspection was 15 days. That has since been reduced to six.

However, many companies are finding they don't have enough adjusters that are licensed in New York State to be able to contend with the volume of claims. So the governor has approved a number of temporary state licenses to out-of-state adjusters to help speed the process.

Some insurance companies have even sent mobile claims offices to areas that were hardest hit.

And just recently, the state's Department of Financial Services announced it would increase production of their endorsements of borrowers' initial insurance checks, which tend to be worth anywhere from $5,000 to $20,000. That's a process that can take anywhere from two to four weeks, and now it should take just a few days. Additionally, some lenders promised to immediately release checks that would assist in making certain homes livable, while also providing policy holders funds to live elsewhere in the meantime.

Still, if Katrina and other major disasters have taught us anything, it is that at the end of the day, these are businesses, and they are working to protect their bottom lines. In the aftermath of Katrina, the Gulf Coast saw throngs of policyholders denied legitimate claims for repairs. This only serves to slow the recovery process.

What was a key issue then and may be one for us here today is the determination of whether damage was caused by wind or flood. After Katrina, home and business owners were shocked to learn that their insurance companies refused to pay their claims on the basis that the damage had been caused not by wind, but by flood - something that was not covered under the majority of policies.

The fact is, most insurance policies carry protection for wind damage, but very few include coverage for flooding. There may be a select few individuals who paid high premiums for additional insurance to cover flooding, but before Sandy hit, most New Yorkers probably thought they would never need it.

What may end up complicated matters is if part of the damage is determined to have been caused by flooding, while other parts by wind. Which caused more damage? And who shoulders the burden of proof in that case?

Our New York insurance lawyers are ready to answer all of your hurricane damage insurance-related questions.