LEGISLATIVE UPDATE: Independent Contractor v. Employee

NJ: Proposed Legislation

NJ State House

It was all but certain to pass. New Jersey Governor Phil Murphy was waiting to sign it. Television ads proclaimed its virtues. But the State’s anti-independent contractor bill (similar to California’s AB5) was pulled from the last legislative session. Groups representing independent contractors in myriad occupations made forceful and practical arguments against the bill. Included were freelance writers, musicians, doctors, various independent teachers, truckers, graphic designers, bakers, and others. Many legitimate independent contractor businesspeople prefer the freedom of owning and operating their own businesses. They do not want to be artificially classified as employees, a move they say would harm their businesses. The legislation was re-introduced on January 14th, and referred to the Labor Committees of both the Senate and Assembly. We are watching developments in both New Jersey and New York, which is also considering similar legislation.

CA: Preliminary Injunction Granted

Much to the relief of many, on January 16th, Judge Benitez granted a preliminary injunction to the California Trucking Association, temporarily stopping the enforcement of AB5 upon motor carriers. In his decision, Judge Benitez writes, “…there is little question that the State of California has encroached on Congress’ territory by eliminating motor carriers’ choice to use independent contractor drivers, a choice at the very heart of interstate trucking. In so doing, California disregards Congress’ intent to deregulate interstate trucking, instead adopting a law that produces the patchwork of state regulations Congress sought to prevent. With AB-5, California runs off the road and into the preemption ditch of the FAAAA.”

John Lane Reflects Upon a Great TIDA Annual Seminar Amid a Gathering of National Heroes

photo by Louise Lane

I recently attended the 27th Annual Seminar of the Trucking Industry Defense Association, in Tampa, Florida, gathering with wonderful friends from across the county. As a bonus, we shared our hotel with some of the most inspiring Americans – recipients of the Congressional Medal of Honor at their annual meeting.

The two-day educational program was kicked off by a state-of-the-industry presentation by Randy Guillot, the new chairman of American Trucking Associations. Mr. Guillot gave specific descriptions of how the siege of lawsuits against trucking companies affects the profitability of companies because of the expense of defending lawsuits, payments of settlements and judgments, and increasing insurance premiums from a downsizing of the insurance market. He gave a call to arms to those of us who defend truckers every day.

That address was followed by a discussion by a panel of insurance, trucking, and legal experts, of the view that more cases need to be tried, rather than settled, to help stem the tide of lawsuits. A well-known plaintiffs’ attorney gave his views of trucking cases from his side of the lawsuits, while the remainder of the first day saw excellent presentations on technology and whether advancements are creating additional standards of care, the potential tensions between safety and claims departments, and regulatory compliance, with a final panel devoted to urging a commitment to the sharing of information and ideas through an open forum to assist all who work in and who defend trucking companies.

The final day concentrated on controlling and reducing damage awards, countering the Reptile attack of the industry by plaintiffs’ lawyers, and some good news of some recent successful verdicts. A strong appeal was made for the defense bar to help respond to the onslaught of media advertising by the other side, especially targeted at trucking companies.

Our hotel was also home to the 2019 annual meeting of the Congressional Medal of Honor Society, an affair that lasted all week and brought together 46 of the 70 living recipients of the Medal of Honor. (The ranks grew to 71 on October 31, 2019, when President Trump awarded the Medal to Sergeant Matthew O. Williams). Only two date back to World War II. A third, Francis Curry, had passed away less than two weeks before the gathering. Some 3500 Medals of Honor have been awarded by presidents of the United States since the Civil War, many posthumously. The 71 living honorees form an extremely exclusive group. To have had the opportunity to speak with some of the attendees, shake their hands and say “Thank you, sir,” was awe-inspiring.

John

Does Admiralty Law Permit Punitive Damages in a Seaman’s Injury Claim Based on Unseaworthiness?

The Supreme Court rules that it does not, in Dutra Group v. Batterton, decided on June 24, 2019.

“This case asks whether a mariner may recover punitive damages on a claim that he was injured as a result of the unseaworthy condition of the vessel.” With that introduction, Justice Alito began a fascinating history of maritime personal injury claims on behalf of merchant seamen. In maritime and admiralty cases, the federal courts sitting as courts of admiralty “proceed in the manner of a common law court,” as instructed by the Constitution. In Batterton, the Court exercised its jurisdiction to decide that punitive damages are not available in a mariner’s personal injury claim based upon unseaworthiness of the vessel.

Christopher Batterton worked as a deckhand on vessels owned by Dutra Group. His hand was injured when it was caught between a bulkhead and a hatch that blew off as a result of unventilated air accumulating and pressurizing with the compartment. Batterton alleges this was an unseaworthy condition causing his injuries, for which the owner is strictly liable under federal admiralty law. He seeks compensatory and punitive damages.

Photo by Pixabay on Pexels.com

Historically, maritime law was largely judge-made, protecting seamen as “wards of the admiralty,” because they led “miserable lives.” Unlike the common law, many admiralty cases in the Supreme Court are named for the ship involved, because in true maritime claims the ship is a defendant in the court action. In The Resolute (1897), named for the ship involved, the Supreme Court held that the Constitution’s grant of admiralty jurisdiction includes “the power to dispose of a case as justice may require.”

Before any federal legislation on maritime personal injuries, the law of admiralty created two remedies for seamen, found in no other field of law. The first, arising in the 12th and 13th centuries, is “maintenance and cure,” requiring a ship’s master to provide food, lodging, and medical services to a seaman injured while serving the ship – a sort of medieval worker’s compensation. The second, “much more recent development,” is a claim for unseaworthiness, which grew out of causes of action unrelated to personal injury. For example, a seaman could collect his wages even if he refused to board an unseaworthy ship. The Cyrus (Pa. 1789). Unseaworthiness of the vessel was held to be a defense to criminal charges of refusal to obey the master’s orders. And a claim of unseaworthiness could be asserted by a shipper for cargo damage, or by an insurer to deny coverage when the poor condition of the ship resulted in damage to or loss of the cargo. The Caledonia (U.S. 1895).

In 1903, the Supreme Court decided The Osceola, concluding that “the vessel and her owner are liable to an indemnity for injuries received by seamen in consequence of the unseaworthiness of the ship.” Lower court rulings put limitations on this landmark decision, holding that there would be no recovery based on negligence that does not render the vessel unseaworthy, and requiring a seaman to show that the owner of a vessel had failed to exercise due diligence in ensuring the ship was seaworthy condition.

In 1920 Congress passed the Jones Act, which enables an injured seaman to sue for damages resulting from the negligence of the owner, master or crew of the vessel. The Act provides recovery for compensatory damages, but is silent on punitive damages. Importantly, the seaman was granted a jury trial under the Act, something not available in an unseaworthiness claim. It became common for injured seamen to include counts for negligence under the Jones Act, and unseaworthiness claims under the general maritime law. The latter provides for strict liability without proof of negligence. The former, the Jones Act, provides a jury trial.

Traditionally, maritime law does not provide for punitive damages in any kind of claim. That history controlled the Court’s decision in this case: “Punitive damages are not a traditional remedy for unseaworthiness. The [cases] promoting uniformity in maritime law . . . [prevent] us from recognizing a new entitlement to punitive damages where none previously existed. We hold that a plaintiff may not recover punitive damages on a claim of unseaworthiness.” Thus, stare decisis continues in the ancient and venerable field of maritime law.

John Lane Named Co-Chair of the Transportation ADR Council

John has been named co-chair of the Transportation ADR Council, an arm of the Transportation Lawyer’s Association, a nationwide organization of attorneys in corporate, government, and private practice in the field of transportation law. Together with the ADR Council’s other newly-named co-chair, Dan Fulkerson, Esq., of Houston, John will manage the arbitration/mediation apparatus for resolution of legal disputes arising in the transportation industry.

Recognizing the value of alternate dispute resolution and the benefit it would avail to members of the transportation industry, John along with several other TLA members, sought to create a body of rigorously-trained arbitrators and mediators who are experts in transportation law, and a system of arbitration procedures that accommodate the parties. Under the leadership of Steve Uthoff, Esq. and Eric Benton, Esq., they formed the Transportation ADR Council.

In addition to his role with the ADR Council, John is a member of the American Arbitration Association, the New Jersey Association of Professional Mediators, the Garibaldi Inn of Court for Alternative Dispute Resolution, the Dispute Resolution Sections of the New Jersey and New York State Bar Associations, and has recently been accepted as an arbitrator for the Financial Industry Regulatory Agency, FINRA. John also serves as a mediator in the Superior Court of New Jersey.

Learn more about the TLA and the ADR Council at https://translaw.org.

On This Date in SCOTUS History – June 13

photo by Jennifer Enberg

​In 1966, the landmark case of Miranda v. State of Arizona, 384 U.S. 436 (1966), was decided.  The 5-4 majority held that a person in custody must be informed of his right to counsel before and during questioning, and the right to not self-incriminate.  It further held that the suspect must not only understand these rights but, should the suspect choose to waive these rights, that it be done voluntarily.  While most are familiar with the case of Miranda v. Arizona, which gave rise to the term “Miranda rights,” did you know that three additional cases fell under this SCOTUS ruling?  Westover v. United States, Vignera v. New York, and California v. Stewart, had been consolidated with Miranda.


In 1967, Thurgood Marshall was nominated to the Court by President Johnson. He was confirmed on August 30, 1967, by a vote of 69-11, becoming the first African American to serve as an Associate Justice.  Justice Marshall, himself, won 29 out of the 32 cases he argued before the Supreme Court, the most famous being Brown v. Board of Education of Topeka, 347 U.S. 483 (1954).

Care, Custody, or Control, Water Damage Exclusion, Dominate Recent New Jersey Insurance Decisions

Mix a safe, a blowtorch, and $4,000,000 in pearls, and you have a dandy insurance coverage fight. Companion Trading Company, a New York business, purchased a safe from Mega Security Company, in New Jersey. Companion used the safe to store semi-precious jewelry, including pearls at its New York location. For some reason the safe door became immovable, and Companion called Mega in to investigate. Mega’s technician could not open the door, and so arranged to ship the safe back to New Jersey for further work. Over several days Mega employees and an outside technician worked on the safe in vain at Mega’s headquarters. Finally, they opened the safe by using a blowtorch. When Companion got it back and checked the contents, they saw that a valuable cache of pearls had been damaged.

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