The Supreme Court and President Trump Agree -- Nursing Homes Plaintiffs May Be Required to Arbitrate
Melito & Adolfsen P.C.
"There is no doubt that this case is distasteful; it may be worse than that. But our concern is not with tawdry tales of Ferrari's, Rolex's and ball gowns. It is instead with the broader legal implications of the government's boundless interpretation of the federal bribery statute. A more limited interpretation of the term "official act" leaves ample room for prosecuting corruption, while comporting with the text of the statute and the precedent of this Court."
New York's Highest Court, the NY Court of Appeals, issued a decision holding that the phrase "caused by your acts or omissions" in the additional insured endorsement requires that the named insured wrongful actions be a proximate cause of the accident. The Court of Appeals reversed the Appellate Division which had held that it was the same as "arise out of" such that employee injuries always created additional insured coverage. The decision narrows the coverage an requires some affirmative fault on the part of the named insured for the coverage to apply.
The way to stop a runaway train is to push the brake. The way to stop a runaway horse is to pull the reins. The way to stop a runaway jury is to demand arbitration.
The New York Times provides the background for this fascinating question in its September 23, 2016 article, Physicist in Albany Corruption Case Was a Geek With Big Goals, by Vivian Yee. As Ms. Yee tells it:
A short while ago 49 people were killed in a club in Orlando Florida. Last week bombs exploded in NYC's Chelsea and Linden, New Jersey. These incidents reveal a very troubling issue for security in the United States. Each of the perpetrators of these crimes had been reported to the FBI as potential terrorists and each time the investigation ended with no arrest.
On September 8, 2016, the United States moved to dismiss the charges against Robert F. McDonnell and his wife Maureen McDonnell. The reason given for the decision was short but thoughtful: "After carefully considering the Supreme Court's recent decision and the principles of federal prosecution, we have made the decision not to pursue the case further." The decision not to prosecute is a matter of prosecutorial discretion and cannot be reviewed by a court. The prosecutor's discretion is respected by the Courts, and has been seen lately in many high profile matters. For example, FBI Director James B. Comey, a prosecutor whose dignity some might say, in the words of Lionel Trilling, "is wholly manifest in word and deed...," was strongly criticized for not recommending the prosecution of Hillary Clinton over her e-mails.His reasoning was: "Although there is evidence of potential violations of the statutes regarding the handling of classified information, our judgment is that no reasonable prosecutor would bring such a case."
On August 31, 2016, the United States Court of Appeals, ruling on an issue the PLO and PA had been making since Sokolow was commenced in 2004, dismissed the case for lack of personal jurisdiction. But there is more to the Sokolow case than what can be found in the Second Circuit opinion. First, there is nothing extraordinary about the dismissal for personal jurisdiction. There was always a compelling argument that the PLO and PA were not subject to jurisdiction. Knowing this, the PA and PLO have argued that there was no jurisdiction over them for more than 12 years. Their original attorney, Ramsey Clarke, a former Attorney General of the United States and the son of Supreme Court Justice Tom Clarke, felt so strongly about the issue that he refused to file an answer to the complaint based on his principled view that the PLO and PA were not subject to personal jurisdiction in the United States.
There are many state and federal statutes which provide personal liability against the owners of businesses that are operated through corporate or other legal forms such as Limited Liability Company's ("LLC's"). One such statute is New York's Public Health Law §2808-a, which allows anyone seeking damages to make a claim against a "controlling person" of the nursing home. The definition of a "controlling person" is a person who has the ability to financially affect the operation of the nursing home. The ability to sue the owner of a nursing home is often used as a tactic to put pressure on the owners when there is no need to sue them because the recovery can be had against the nursing home. The statute, quoted in full below, and highlighted in bold to emphasize certain features, provides: