Comments on Recent Cases: August 2022
Part of my work involves reading court decisions to keep abreast of how judges decide the types of cases I handle. Below, I share some thoughts on recent decisions.
Court Enforces “Buyer Beware” Disclaimer at Auction
When sellers expressly say that they are not making any representations about the quality of their wares, courts are reluctant to hold sellers accountable in litigation when buyers feel deceived with their purchases.
For example, in a recent case, the state appellate court in Manhattan considered whether a buyer of a Russian medal could sue an auction house once he discovered the medal did not have real diamonds. The auction house publicized “Terms of Sale” that stated that it “made no warranties or guarantees or representations” about its items. Accordingly, the court held the buyer could not recover from the auctioneer.
Cases like this highlight the importance of disclaimers by sellers and of due diligence by buyers.
Twitter Issues Subpoenas in Dispute with Elon Musk
The Wall Street Journal quoted me in an article about the Twitter v. Elon Musk dispute. Although I am not an attorney in that dispute, I commented that Twitter may have served subpoenas on investors to investigate whether Musk really did the work necessary to acquire the company.
Amber Heard Retains New Counsel in Appeal
The New York Post quoted me in an article about Amber Heard’s appeal in her lawsuit against Johnny Depp. Ms. Heard retained new counsel to help in her appeal. I am not an attorney in that dispute, but I often help clients in different jurisdictions, so I thought I would share some of the benefits of having a lawyer who has experience in a particular subject versus the benefits of having a lawyer with local expertise.
Court Determines Freelancer’s Business Qualifies for Law Making it Easier to Sue Clients Who Do Not Pay
Often it may not make economic sense to sue for hundreds or thousands of dollars, since the legal fees to litigate may exceed the amount a plaintiff seeks to recover. But many small businesses need a way to compel payment in those amounts from clients.
New York recently adopted a law called the Freelance Isn’t Free Act (“FIFA”). It enables freelancers to sue customers that do not pay and recover double what they were owed, plus attorney’s fees. The purpose of the law is to discourage customers from not paying and to enable freelancers to afford litigation. But the law does not apply in every case; just when the plaintiff is a freelancer that works by his or herself.
The state appellate court in New York recently decided whether a plaintiff qualified as a freelancer under FIFA. It decided that a company that was owned and operated by one person and that itself hired three independent contractors could still be a freelancer, and that a model that worked with an agency that collected payments on her behalf could also be a freelancer.
Cases like this provide helpful details about New York’s FIFA law.
Court Requires Plaintiff to Arbitrate Against Defendant Despite No Contract Between Requiring Arbitration
A person can waive her right to pursue claims in court by signing an agreement with an arbitration clause. But in some situations, a party can only pursue arbitration even if she did not sign an arbitration agreement with the defendant.
This issue arose in a recent case before the state appellate court in Manhattan. In that case a musician licensed his work to a production company who sublicensed it to another company. The plaintiff alleged the agreement between the licensee and the sublicensee entitled it to royalty payments, but since that agreement had an arbitration clause, the court held it needed to arbitrate that claim.
Cases like this illustrate how a court can extend an arbitration provision to a third party beneficiary of an arbitration agreement.
Court Shields Co-Workers from Litigation Because of Workers Compensation Law
Employers in New York are protected from personal injury claims by employees so long as they maintain Workers Compensation Insurance. This provides an incentive for employees to sue other people who do not benefit from such a shield.
This issue arose in a recent case before the state appellate court in Brooklyn. An employee of a company was in a three car accident that involved two cars driven by coworkers and a third car driven by a stranger. The court upheld the dismissal of the litigation against the employer and the two drivers because of the worker’s compensation law, but reversed the dismissal against the stranger.
Cases like this illustrate how the Worker’s Compensation Law influences who the defendants are in personal injury lawsuits.