by KPMLAW | Jun 14, 2016 | KPMBlog, News, Uncategorized, Updates
Written by Gary Reinhardt, Esq. In Virginia, a material misrepresentation in an insurance application may render the insurance policy voidable. Who is an “applicant” is a question that an insurer must answer, particularly with small businesses set up as LLCs or corporations. In Jeb Stuart Auction Services, LLC v. West American Ins. Co., 122 F.Supp.3d 479 (W.D. Va. 2015), the Court ruled on who was the “applicant” when an individual completed an insurance application for an LLC. The person completing the application previously had been convicted of insurance fraud. The insurance application asked, “Has any applicant been indicted for or convicted of any degree of the crime of fraud . . .” The individual completing the application on behalf of the LLC answered “No” to this question. The individual then signed the application at the “Applicant Signature” location. Following a fire, the insurer voided the policy and denied coverage, claiming that the individual’s “No” answer to the fraud question amounted to a material misrepresentation in the application. The insured countered that the individual was not the “applicant.” Instead, the LLC was the “applicant” and the LLC had not been convicted of fraud, the LLC had not materially misrepresented facts on the application and, therefore, the LLC had coverage for the fire. The insurer responded that an LLC obviously cannot complete an application and must speak through its members. Further, in order to assess risk, the application must seek information about the party or parties that make up an LLC. The insurer argued that the failure to disclose the fraud conviction voided the policy. The Court sided with the LLC,...
by KPMLAW | May 24, 2016 | KPMBlog, News, Profiles, Uncategorized
AM Best, the oldest and most widely recognized provider of ratings, financial data and news with an exclusive insurance industry focus, recently featured KPM’s Brian Cafritz on their “Best’s Directories Insurance Law Podcast.” Brian has been closely following news and rulings related to restroom access for transgender individuals. Listen to the podcast here or view the transcript below. You can follow Brian on Twitter at @briancafritz. John Czuba: Welcome to the “Insurance Law Podcast,” the broadcast about timely and important legal issues effecting the insurance industry. I’m John Czuba, managing editor of Best’s Directory of Recommended Insurance Attorneys. We’re pleased to have with us today attorney Brian Cafritz from KPM LAW in Richmond, Virginia, with additional offices in Fairfax, Norfolk, and Roanoke, Virginia. Brian is a partner in the firm, and helped to expand the firm’s regional defense network. He focuses his practice on the defense of Fortune 500 companies that operate under large self-insured retentions. He co-founded the National Retail and Restaurant Defense Association to promote the education and communication channels of industry leaders and counsel. Brian was elected to the first two terms as the association’s first president. He is also the only Virginia attorney selected to IALDA, a defense network dedicated to the defense of the amusements and leisure industry. We’re very pleased to have you with us today, Brian. Brian Cafritz: Thank you very much, proud to be here. John: Today’s topic is on legal issues pertaining to transgender restrooms, and Brian this has been a very topical issue of late, can you comment on which states have been the most impacted? How common is...
by KPMLAW | May 24, 2016 | KPMBlog, News, Uncategorized, Updates
Written by Jessica Relyea, Esq. Edited by Brian Cafritz, Esq. With the ubiquitous nature of social media, more and more retail and restaurant establishments are requiring confidentiality clauses in settlement agreements to contain strong penalties that deter a breach. In an effort to streamline litigation should a breach occur, those provisions often contain liquidated damages clauses, which state the parties agree a breach of confidentiality would result in a return of all settlement proceeds. This begs the question, is this provision enforceable? If a plaintiff breaches confidentiality, can you get the settlement funds back? The Supreme Court of Virginia has held, and the Eastern District of Virginia has recently reaffirmed, that parties “may agree in advance about the remedy resulting from a breach, including damages, but only when (i) the actual damages contemplated at the time of the agreement are uncertain and difficult to determine with exactness and (ii) the amount fixed is not disproportionate to the probable loss.” Job v. Simply Wireless, Inc., 2015 U.S. Dist. LEXIS 171535, *11 (E.D. Va. Dec. 22, 2015). A breach in confidentiality would be a good example of when actual damages are unknown, as the facts surrounding the breach are also unknown at the time the release is negotiated and executed. The bigger question for a restaurant or retail establishment to consider is whether or not the amount of damages is proportional to the probable loss. To help answer that question, Virginia courts will allow discovery into a liquidated damages clause to determine if the “stipulated damages are grossly in excess of the actual damages suffered by the non-breaching party.” O’Brian...
by KPMLAW | May 24, 2016 | KPMBlog, News, Uncategorized
Idiopathic and unexplained accident cases are on the rise as more employees are taking medications for a myriad of health issues. An idiopathic accident is one where the injury is caused by a preexisting personal disease of the employee (diabetes, seizures, etc.) and can be compensable if the employment increases the dangerous effects of the condition. Typically, compensable idiopathic injuries are found in motor vehicle accident and fall from ladder cases. Unexplained injuries are not compensable because the claimant cannot prove that the injury arose out of the employment. In an unpublished decision, Burney-Vivens v Community Corrections Administration, the Court of Appeals addressed the idiopathic v. unexplained injury issue. In Burney-Vivens the claimant had a history of migraines. She had also sustained a compensable back injury in 2012 for which she was still taking medication. She was driving an employer provided car while on assignment for her employer. Because she was driving she did not take her back pain medication that day. She was involved in a single car accident in which her car left the road and went down an embankment. She testified that at a certain point in time on the trip, after driving past a sign for the Town of Boones Mill her vision diminished and started blurring. The next thing she remembered was crawling out of the car. She did not remember what caused her to run off the road. At the hearing, the claimant alleged that her accident was caused by an idiopathic condition of blurred vision due to her pre-existing migraine headaches. In the alternative, she alleged that she blacked out because of...
by KPMLAW | May 24, 2016 | KPMBlog, News, Profiles, Uncategorized
Written by Beth Gould, Esq. Companies increasingly face competing demands and challenges associated with the desire to provide convenient online spaces for their clients to conduct business while also ensuring those spaces are safe from data breaches. We are all familiar with, and seem to constantly hear about, data breaches due to intentional hacking by third parties who seek access to companies’ websites and other online databases in order to steal consumers’ information. However, there are also more passive data breaches which can occur due to a company failing to fully secure an online space. In the latter case, rather than a third party actively seeking entry into a companies’ online consumer information, a company may inadvertently fail to shore up a vulnerability in an online space it provides to its consumers, potentially leaving consumer information available to the public. Both types of data breach are risks which an insurer may consider insuring or may wish to forego insuring. If an insurer wishes to forego covering either, or both, sort of data breach, it must clearly address that when drafting its policy. The United States Court of Appeals for the Fourth Circuit recently considered a case involving a passive sort of data breach, affirming in an unpublished opinion that under the applicable insurance policies, a healthcare recordkeeping company must be accorded a defense by its insurer against claims by consumers that the company had made consumers’ private healthcare information accessible online to the general public. On April 11, 2016, the Fourth Circuit Court of Appeals ruled on an appeal by the plaintiff in the declaratory judgment action, Travelers Indemnity...
by KPMLAW | May 24, 2016 | KPMBlog, News, Uncategorized
I originally planned to go straight into law school and had taken the LSATs and sent off applications. My diversion into opera and theater resulted from volunteering during my last semester at UVA to sing a small opera scene for a doctoral student doing some of her research in the music department. She had been unearthing old French operas from the Baroque period and had to direct a scene from one as part of her program. She asked for students from the singing groups to assist her and I volunteered. I sang the tenor part of Sancho from “Don Quichotte chez la Duchesse” by Joseph Boudin de Boismortier. After completing the performance, the doctoral student-director told me she thought I should study opera and contacted four teachers in New York and Philadelphia to have me sing for them. That summer, I sang for two of the teachers in the small practice studios in Carnegie Hall. Although I was not ready to move to New York at that time, I found a teacher in Washington, DC and two years later auditioned for and received a full scholarship to study opera at the Academy of Vocal Arts in Philadelphia. I quickly learned I did not have a Pavarotti-sized voice, but found a lot of good work singing secondary character roles in opera and operetta, lead roles in American musical theater, and oratorio in Philadelphia, Minneapolis, Chicago, Dayton, in Wisconsin, and at rotating repertory theaters in Pennsylvania, Virginia, and Florida. As with a lot of struggling performers, I did a lot of different things to try to branch out and pay the...
