Firm News: Uncategorized

gartner + bloom, P.C. congratulates Partner Arthur P. Xanthos on scoring an impressive appellate victory by convincing an appellate court to reverse a Brooklyn trial judge on a complex toxic tort causation issue.

At the trial level, Arthur P. Xanthos requested and conducted a “Frye” hearing to disqualify the plaintiff’s medical expert from testifying that toxic mold exposure caused the plaintiff’s massive neurological, dermatologic, and internal injuries. The expert had intended to give a medical opinion at trial that the plaintiff suffered a cascade of physical injuries after exposure to toxic mold over a decade ago in our client’s building.

Despite a strong presentation at the hearing, the Brooklyn trial judge refused to disqualify the plaintiff’s expert, reasoning that a treating doctor should be able to say just about anything at trial. So Arthur appealed to the Appellate Division.

Yesterday the Appellate Division ruled, unanimously reversing the Kings County trial judge. In its ruling, the appellate court highlighted the very high standard a toxic tort plaintiff must attain to warrant a trial for bodily injury damages, and reasoned that Arthur’s evidence, witnesses, and arguments at the trial level sufficiently proved that plaintiff’s medical expert’s opinion on causation was not generally accepted in the medical community. Access a copy of the decision by clicking here.

Arthur’s successful result for the client is one of hundreds he and the firm have obtained in the defense of toxic tort lawsuits over the last 30 years, earning us our stellar reputation in the defense of such claims. Grand kudos🎩to you, Art on delivering a spectacular outcome!

View Oral Argument »

Senior Associate, Maria Miller Esq convinced a highly-regarded NYC plaintiffs firm to accept a low 5 figure amount settlement, where the demand started at close to 1 Million dollars.

Plaintiff claimed that because of a trip and fall in a Brooklyn discount store, she suffered a facial disfigurement/ laceration and required a right ankle incision and drainage of a large hematoma. Pictures after the accident were graphic and would have provided vivid evidence for a jury.

Settlement discussions were initiated after the firm developed a detailed injury timeline to show treatment chronologies and extensive medical summary analysis, built out by our Junior Associate, Austin LaBorwit. Maria concluded and argued that all the Plaintiff’s injuries were treated immediately after the accident and had healed since then.

At that point, Plaintiff reduced their demand by half but added an argument that Plaintiff developed significant neurological problems after she hit her head requiring neurological visits.

We pointed to the lack of records of Plaintiff seeing a neurologist for any extensive period and Plaintiff’s counsel again reduced the demand.

After discussion with our client, we conducted an onsite investigation at the Brooklyn discount store and determined that Plaintiff’s version of events leading to her accident was questionable. Further we obtained pictures and videos for discussion at Plaintiff’s deposition.

With our extensive field investigation pictures, videos, comprehensive medical summaries and invaluable timeline chronologies, we were able to secure a favorable outcome with a settlement equal to about 3% of the settlement demand.

Congratulations Maria and the dream team on delivering a fabulous result. 👏👏

By Maria Miller, Esq.

Plaintiff homeowner and defendant contractor entered into an agreement for home renovation construction, which allegedly resulted in defective and incomplete construction. gartner + bloom, P.C. represented the general contractor who, after performing substantial construction services, was replaced with another contractor following a dispute with the homeowner. 

Plaintiff then decided to expand the construction project and demanded from our client the costs associated with the new contractor’s fees. Our client was facing a contract claim for more than a quarter million dollars.

In the lawsuit, Plaintiff asserted causes of action for breach of contract, fraudulent inducement, unjust enrichment, violation of General Business Law Sections 349 and 772, New York Lien Law Section 71-a and unjust enrichment. After strategic discovery and targeted deposition questioning, we made a motion for summary judgement the Duchess County Supreme Court granted entirely but for one breach of contract claim. Trial was scheduled for June 2024.

Attorney Maria Miller Esq began settlement discussions with Plaintiff’s counsel and argued line by line each hard cost associated with Plaintiff’s remaining contract claim.  

Further, during the pre-trial conferences with the assigned judge, Maria carefully negotiated and secured successively lower settlement demands (at one point arguing successfully for a legal fees sanction against Plaintiff’s counsel).

Plaintiff’s counsel paid the legal fees sanction and, deciding that discretion was the better part of valor, accepted Maria’s settlement offer to avoid further litigation setbacks. 

In the end Maria Miller Esq settled the case for 16% of the initial demand and avoided our client being personally exposed to an uninsured judgment. 

Congratulations and Champagne Cheers to Maria and the team💜🥂💜

By Jessica Price

New York Labor Law remains an uphill battle for the defense as the Court limits the integral to work defense under Labor Law 241(6). The lower courts were recently more inclined to deny plaintiff summary judgment as to Labor Law 241(6) based on a violation of Industrial Code Section 12 NYCRR 23-1.7 (d) based on the integral to the work defense, but in its February 20, 2024 Court of Appeals Decision in Bazdaric v. Almah Partners LLC, 2024 N.Y. LEXIS 71, the Court overturned the lower courts’ denial of plaintiff’s summary judgment motion as to Labor Law 241(6), finding that the integral to the work defense was inapplicable as to Industrial Code 12 NYCRR 23-1.7 (d).  

In Bazdaric, plaintiff, a painter, slipped and fell on a plastic covering that was placed over an escalator, which he had to stand on so he could paint.  When plaintiff stood on the plastic, he slipped and fell due to the plastic covering.  The lower courts held that the plastic covering was integral to the work and denied plaintiff summary judgment as to Labor Law 241(6) pursuant to 12 NYCRR 23-1.7 (d).  Plaintiff argued that drop cloths would have been appropriate.

In the Court of Appeals Decision, the majority held that plaintiff established that the covering was a slipping hazard that defendants failed to remove in violation of Industrial Code 12 NYCRR 23-1.7 (d), rendering defendants liable under Labor Law § 241 (6). The Court heled that “additionally, contrary to the Appellate Division's conclusion, the plastic covering was not integral to the paint job but was created by use of a nonessential and inherently slippery plastic that caused plaintiff employee's injuries.” 

As always with Labor Law, the Court of Appeal’s Decision is heavily reliant on the deposition testimony of the parties.  The Court sites to plaintiff’s deposition testimony wherein he testified that he complained about the use of the plastic, which was unsecured.  Further, the general contractor’s superintendent also testified that the plastic was the wrong type of covering for the escalator and that often wood would be used instead.  The Court was unmoved by an affidavit from a foreman stating that plaintiff had placed and used the plastic covering himself, even though canvas drop cloths were available.  The majority opinion finds that the plastic covering was not part of the escalator and therefore was a foreign substance under 12 NYCRR 23-1.7 (d).  

The concurring opinion of Justice Garcia notes that the majority fails to focus on 23-1.7(d)’s requirement that a foreign substance caused the slippery condition. “The Court invoked the principle of ejusdem generis to conclude that the plastic sheeting was not a foreign substance because it "is not similar in nature to the foreign substances listed in the regulation, i.e., ice, snow, water or grease." This dicta may be useful in distinguishing cases in motion practice as the Court’s conclusory finding that the plastic covering was a foreign substance is devoid of any reference to snow, water or grease. 

This Decision only further emphasizes the need for thorough questioning during depositions to obtain all facts that could sway the Court.

Well-deserved congratulations to our newly-elevated Partners: Kenneth O'Donohue, Vera Tsai, Narri Subrati, and James E. Stephens, Esq.

We appreciate your dedication, hard work and outstanding achievement over the years and look forward to your continued growth, success and prosperity at the firm! Here's to celebrating each of you 🥂

Well-deserved congratulations to our newly-elevated Senior Partners: Susan Mahon, Alexander Fisher, Rebecca Appelbaum, Anne Armstrong and Roy Michael Anderson!

We appreciate your dedication, hard work and outstanding achievement over the years and look forward to your continued growth, success and prosperity at the firm! Here's to celebrating each of you 🥂

By Jacqueline Muttick & Kenneth O’Donohue

While attorneys have been navigating both the implementation and implications of artificial intelligence in the legal industry, the courts and state legislatures have been weighing the ethical hazards related to use of this emerging technology. Two recent examples are Florida and New Jersey. Florida has now issued ethical guidelines for the use of artificial intelligence in the legal industry, while New Jersey has released preliminary guidelines for it.

Generative artificial intelligence (“AI”) utilizes neural networks comprised of large datasets to generate content. This is how a program like ChatGPT takes a prompt, performs automated analysis using predictive models, and provides a text output to the user. While this can be a valuable tool when used correctly, the novelty of AI has led to unanticipated outcomes, including the generation of false information. The consequences of such false information have resulted, in some extreme cases, in attorney sanctions and ethical complaints against lawyers that have improperly utilized AI. In response, courts have established committees to offer guidance to both the courts and legal counsel.

Florida’s guidelines (Opinion 24-1) stress the need for confidentiality, accuracy, competency, and adherence to current ethical standards. Florida does not bar the use of AI, but does require oversight to ensure that firms establish polices for the use of AI in research, drafting, and communications. All law firm personnel, including third-party vendors, should be aware of and adhere to these policies. AI results must be verified for accuracy and truthfulness, and must be consistent with attorney professional and ethical standards.

The Florida guidelines also address legal billing. Any costs associated with the use of AI should be disclosed to clients, and any increases in efficiency should be reflected in invoices. Further, lawyer advertising created by AI must adhere to current legal advertising standards. To the extent that AI is used on a lawyer’s website as a chatbot, that program should be modified to conform to ethical rules, including disclosing it is a chatbot, limiting responses to avoid giving legal advice, and including screening questions to prevent communications with website visitors already represented by counsel.

Florida’s opinion also stresses that confidentiality must be maintained when utilizing AI. Users must prevent disclosure of confidential information, particularly because AI programs may store and save user prompts thereby retaining confidential information. Before utilizing AI, attorneys should determine the security protocols concerning user prompts, as well as how user prompt information is utilized, retained, and destroyed. Further, if confidential information must be disclosed to an AI program, client consent may be required.

New Jersey’s preliminary guidelines, while not as robust as those issued by Florida, still provide direction by stressing that AI does not change the core ethical responsibilities for lawyers.

New Jersey emphasizes that lawyers should engage with AI carefully, focusing on accuracy and truthfulness which includes verifying all information generated by AI. Lawyers may use AI in interacting with clients, and, if asked, must disclose its utilization. Lawyers should remain cognizant of the possibility that AI may generate false information and should therefore confirm all generated information. Disclosure of confidential information must be avoided and it is incumbent upon lawyers using AI to ensure the security of confidential information. Firms and lawyers are responsible for overseeing other attorneys and staff in the ethical use of AI.

Overall, the Florida and New Jersey guidelines underscore the ethical duties already incumbent upon all attorneys and provide direction on considerations that must be undertaken prior to utilizing AI in legal work. With the proliferation of AI in a variety of contexts, including those that may not be obvious at first glance, attorneys must remain attentive and conscientious in adhering to current ethical requirements, and must familiarize themselves with the emerging technology prior to utilization.

On October 30, 2023, President Joseph Biden signed the “Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence”, proclaiming “[the] Federal Government will enforce existing consumer protection laws and principles and enact appropriate safeguards against fraud, unintended bias, discrimination, infringements on privacy, and other harms from AI.” In a subsequent speech, Vice President Kamala Harris emphasized that there was “a moral, ethical and societal duty to… address predictable threats, such as algorithmic discrimination,” a term which describes when AI systems “contribute to unjustified different treatment or impacts disfavoring people based on [race, sex, age, and other protected traits].”

The Executive Order is the latest in a series of Biden Administration pronouncements and policy decisions designed to police algorithmic discrimination using the powers of the Equal Opportunity Commission (“EEOC”) and Title VII of the Civil Rights Act, which prohibit discrimination against employees or prospective employees. The Executive Order directs the Attorney General to convene a meeting of Federal Civil rights officials by the end of January, 2024, to discuss coordination and enforcement measures with the Department of Justice. Clearly, in the years to come, employers will need to insulate themselves from charges of algorithmic discrimination stemming from AI-influenced hiring decisions.

The Department of Justice is particularly sensitive to concerns about AI discrimination in the hiring process because the use of AI has grown exponentially in recent years. Indeed, an August 2023 survey from Zippia found that 35-45% of all companies and 99% of Fortune 500 Companies use AI to assist with employee recruitment.

The concern is that AI, trained on pattern recognition through review of historical hiring data, will develop biases against certain applicants. For example, in 2018, Amazon found that an AI program designed to assist with recruitment of software developers showed bias against resumes which contained the word “women”. The genesis of the problem was that the AI program was trained to find prospective candidates by reviewing resumes submitted by candidates over the preceding ten years, most of whom were male. As such, the AI program unintentionally discriminated against prospective female recruits and potentially exposed Amazon to civil liability. Similarly, in August 2023, the EEOC settled a first-of its-kind lawsuit brought in the Eastern District of New York for $365,000 against iTutorGroup Inc., a company which provided English tutors to students in China. The lawsuit alleged that iTutorGroup utilized AI screening tools to automatically reject female job applicants over age 55 and male job applicants over age 60.

Traditional Indemnification Agreements May Not Be Sufficient To Protect Your Business From Claims of Algorithmic Discrimination

Employers must take special care when seeking indemnification for claims of algorithmic discrimination in hiring because contractual indemnification agreements are barred under existing Title VII case law. In the matter of the Equal Employment Opportunity Commission v. Blockbuster, Inc., the United States District Court for the District of Maryland rejected Blockbuster’s attempt to bring a contractual indemnification claim against a staffing company which had provided it with temporary workers, holding that “the primary goal of Title VII to eradicate discriminatory conduct would be thwarted if Blockbuster were permitted to contract around its obligations and shift its entire responsibility for complying with Title VII.” EEOC v. Blockbuster, No. RWT 07cv2612, 2010 U.S. Dist. LEXIS 2889, at *9 (D. Md. Jan. 13, 2010). Multiple other cases have held similarly, finding that an “indemnification agreement would undermine any incentive to abide by the terms of the act.”¹

Therefore, under existing Title VII case law, if an employer contracts to be indemnified against claims of algorithmic discrimination in the hiring process, the contract is most likely unenforceable.² This begets the question: How can an employer protect itself against claims of algorithmic discrimination?

THE INSURANCE INDUSTRY HAS AN OPPORTUNITY TO OFFER TECHNOLOGY ERRORS AND OMISSIONS COVERAGE TO PROTECT EMPLOYERS FROM THE NEW DEPARTMENT OF JUSTICE ENFORCEMENT MEASURES

An errors and omissions policy (“E&O”) is “intended to insure a member of a designated calling against liability arising out of the mistakes inherent in the practice of that particular profession or business.” Watkins Glen Cent. Sch. Dist. v. Nat'l Union Fire Ins. Co., 286 A.D.2d 48, 51, 732 N.Y.S.2d 70, 72 (2d Dep’t 2001). An example of the language used in a Technology E&O policy can be found in the 8th Circuit decision of St. Paul Fire & Marine Ins. Co. v. Compaq Comput. Corp., 539 F.3d 809, 813 (8th Cir. 2008), where the policy in question states “[w]e'll pay amounts any protected person is legally required to pay as damages for covered loss that . . . is caused by an… error, omission or negligent act." Said policies usually cover the employer’s legal fees as well. Employers looking to mitigate the risk of liability from claims of algorithmic discrimination in hiring should consider obtaining Technology E&O coverage which insures that the AI hiring software being utilized is free from bias and which provides coverage for any incidental or consequential damages.

Unlike the policy at issue in EEOC v. Blockbuster, No. RWT 07cv2612, 2010 U.S. Dist. LEXIS 2889, at *9 (D. Md. Jan. 13, 2010), a Technology E&O policy would not need to specifically reference coverage for claims made by the EEOC. Instead, the policy should be drafted so that the focus of the coverage pertains to claims based upon errors in the AI software. With careful drafting focusing upon the performance of the software, rather than indemnification against discriminatory conduct, the parties to the insurance agreement could perhaps avoid the problems caused by the case law barring indemnification for Title VII claims of discrimination.

A number of companies have already contemplated the need for Technology E&O insurance against claims of algorithmic discrimination. It still remains to be seen whether these insurance policies are ruled enforceable. Moreover, it remains to be seen what additional measures, if any, the Department of Justice and the Attorney General will announce later this month to police the threat of algorithmic discrimination.

1^ See Maness v. Vill. of Pinehurst, 522 F. Supp. 3d 166, 172 (M.D.N.C. 2021); See also Brown v. OMO Grp., Inc., No. 9:14-cv-02841-DCN, 2017 U.S. Dist. LEXIS 45048, at *11 n.4 (D.S.C. Mar. 28, 2017);Cordova v. FedEx Ground Package Sys., 104 F. Supp. 3d 1119, 1136 (D. Or. 2015); Thurmond v. Drive Auto. Indus. of Am., Inc., 974 F. Supp. 2d 900, 906-07 (D.S.C. 2013).

2^ Similarly, if an employer obtains software which utilizes AI to assist in the hiring process and if the use of that software leads to claims of hiring discrimination, the same case law may operate to bar claims for indemnification against the software developer.

Kudos and warm round of cheers to gartner + bloom PC trial attorney, Maria Miller Esq on her immense victory earlier this week in Brooklyn.

Maria’s contractor client was facing the possibility of full liability for a ceiling collapse, a case where the injured plaintiff’s demand at trial was $5 million dollars. Prior to the trial commencing, a settlement offer of $100,000 was extended but rejected.

Maria picked the jury, argued the in limine motions, gave the opening statement to the jury, and cross-examined three witnesses including the plaintiff. Then, on the eve of jury deliberations and a verdict, the third-party plaintiff gave in and accepted what had been offered to them before the trial -- $100k ~ (2% of the claim).

This is an extraordinary result given the fact that our client was facing an uninsured judgment in seven figures and the opposition accepted the carrier’s pre-trial offer.

This incredible resolution eliminated the risk of a significant seven-figure money judgment against our contractor client, and only made possible by innovative, aggressive trial strategy that illuminated the weaknesses in the adversary’s case at every step of the litigation process. Brava Maria Miller Esq on this win and many more!

In a collaborative team effort with an ingenious defense strategy laid out by Managing Partner, Ken Bloom, a construction claim with damages in excess of $10M was defeated for a mere fraction of the demand!

In an iconic commercial tower in NYC’s Financial District, a sprinkler pipe burst in 2019. The Plaintiff brought suit claiming that it was the faulty installation of a specific coupler within the fire suppression system that caused a pipe separation, ensuing flood, which caused millions of dollars in damage especially with regard to the super high speed elevators.

The case was litigated in the Commercial Division in the Supreme Court, New York County by a well known, sophisticated and aggressive commercial law firm.

Managing Partner, Ken Bloom developed a defense strategy that involved recruiting experts in the field of fire suppression, metallurgy and elevators; shifting responsibility to other parties on various products liability theories as well as those involving fluid dynamics.

Based on the analysis and findings from working with our fire suppression, metallurgy and elevator experts, Partner Todd Shaw was able to develop a winning strategic and tactical litigation game plan.

Partner Roy Michael Anderson led upwards of 20 fact witness and expert depositions, and was able to put every adverse witness on the defensive, eviscerating opposing fact and expert witnesses with his knowledge of highly technical issues and extraordinary detailed questioning.

Senior Associate, Michael Hemway spearheaded and oversaw a robust discovery campaign while managing hundreds and thousands of documents with our e-discovery partners.

Not only was this victory due to the strength of the players on the team but to innovative strategies and technological advancements deployed from the onset of the case and throughout to procure an incredibly powerful win for our client.

Most importantly and all along the journey, the team worked very closely with our clients to glean valuable data insights throughout every step of the litigation process.

A standing ovation and grand Kudos to Partners Ken Bloom, Todd Shaw, Roy Michael Anderson, and Michael Hemway as well as all our support team members who contributed to this monumental victory that has already and will continue to blaze trails for similar cases to come!!