Adams Leclair LLP is a litigation law firm that concentrates its practice in commercial and construction advocacy throughout upstate New York. Headquartered in Rochester, New York, we provide specialized counsel, honed by decades of experience in state and federal courts at the trial and appellate levels. We also represent clients in various administrative tribunals from local planning boards and boards of assessment review to state and federal agencies, such as Financial Industry Regulatory Authority (FINRA), the New York State Department of Labor, the EEOC, and the National Labor Relations Board.
Our practice areas additionally include employment, municipal, real property tax, estate and trust litigation. In September 2019, we combined the talents of the construction litigation practitioners from Adams Bell Adams, PC and the experienced commercial litigators from Leclair Korona Cole LLP which has helped us better structure our clients’ business affairs in ways that anticipate and avoid conflict. We are proud of the reputation we have earned among our peers and our clients for vigorous advocacy and effective representation.
In this article, Tony Adams reviews the history of the “gentlemen’s agreement” and the recent MLB press release announcing “Major League Baseball is correcting a long time oversight in the game’s history by officially elevating the Negro Leagues to ‘Major League’ status.”
Snippet from the article:
Two months ago, Major League Baseball announced it would recognize players from seven Negro Leagues that operated between 1920 and 1948 as “major leaguers” for historical and statistical purposes. That symbolic act — nearly all the affected players are long-deceased — finally addresses the last vestige of a shameful “Gentlemen’s Agreement” that excluded generations of Black athletes from white baseball, while defaming their abilities and disparaging the only forums in which they were permitted to play. The wonder is that it took so long.
A true “gentlemen’s agreement,” according to Black’s Law Dictionary, is “an unwritten agreement that is secured by the good faith and honor of the parties.” Such agreements, though not enforceable legally, were central to gaining ratification of the first U.S. Constitution by the states, to opening San Francisco’s public schools to Aisian children in the early 1900s, and to ending the Cuban Missile Crisis in 1962.
Until Jackie Robinson took the field for the Montreal Royals in 1946, a “gentlemen’s agreement” among team owners was cited by baseball’s leaders — if they were being honest — as the reason why no Black athletes had played for any organized professional team since the previous century. (In less candid moments, they said that no African-Americans were good enough to make their teams.)
Tony Adams is a founding partner of Adams Leclair LLP. Contact Tony Adams at 585-327-4100 or aadams(Replace this parenthesis with the @ sign)adamsleclair.law
An Irrevocable Life Insurance Trust — ILIT for short — is a common estate planning tool, well known to attorneys and financial planners. In this article, Anthony Adams discusses some potential ILIT issues, such as what happens if the grantor stops contributing an amount sufficient to pay the annual premium or a beneficiary decides to take some or all of the money to fund the premium. This issue was addressed in Matter of Baron, reported out of Queens County Supreme Court last summer.
Snippet from the article:
The Baron case involved an irrevocable trust that Harry Baron created in 1992 to hold two whole-life insurance policies for the benefit of his children. Baron named a business associate, Roy Leibowitz, as trustee. Until 1998, Baron made annual gifts to the trust that Leibowitz used to pay the policy premiums. But the trust agreement didn’t require Baron to make those annual gifts, and after 1997 he stopped doing so. Click through for the full article.
Anthony J. Adams is a founding partner of Adams Leclair.
Litigation Hold Notice – How do I Locate and Preserve Electronically Stored Information (“ESI”) Relevant to a Legal Dispute?
You may receive a litigation hold notice if you or your company have documents related to a legal dispute that is or may become the subject of a lawsuit.
A litigation hold (also known as a legal hold) notice is a written notification directing you or your company to preserve all documents, both paper and electronic, that are potentially relevant to a legal dispute or lawsuit.
As we are living in an increasingly digital world, understanding what electronically stored information (ESI) is and where it is located will be crucial in order to comply with a litigation hold. ESI is defined as any data or documents that are created or stored on electronic media. Disregarding a litigation hold notice, failing to properly preserve data, or deleting data could expose you to claims of spoliation and penalties issued by a court. Luckily, there are a few simple steps that you can take to preserve your data.
Read the Notice Carefully and Contact your Attorney.
Carefully read the litigation hold notice. Identify the party who sent the notice, determine if the notice specifies any particular people who are asked to preserve the data (often referred to as custodians), determine the type of data they are asking you to preserve, determine the location of the data (often referred to as a device), and determine the date ranges for relevant information.
You should contact your attorney to notify them of the ligation hold as soon as possible. Your attorney can advise you of your duty to preserve data and help to identify any additional individuals in your organization who should also receive the notice.
Identify Where Your Data Resides.
Do you know where all of your electronic data is located, or do you have an inventory of devices? If you have an IT person or department, reach out and ask for assistance. If you are an individual or do not have an IT department, you should create a log of all the devices where you likely store data and the location of each device
Some examples of typical devices and data sources are:
Online email accounts (Office 365, Microsoft Exchange, Gmail, etc.)
Cloud document accounts (iCloud, Google Drive, Sharepoint)
Physical devices (laptop, tablet, cell phone)
Messaging apps (WhatsApp, Slack, Facebook messenger)
Removable devices like USB drives or external hard drives
Backup servers or archives
Social media accounts (Facebook, Instagram, Snapchat)
Provide the list of devices and data sources to your attorney. Your attorney will advise which sources and types of data should be preserved based on the facts of the dispute. If you determine additional devices or locations after the fact, please let your attorney know as soon as possible.
Turn Off All Automatic Deletion and Turn on Data Back-up.
Once data locations have been identified as subject to the litigation hold notice, you should immediately turn off all automatic deletion features on the relevant devices, software, and applications. If you have difficulty navigating these systems enlist help from an IT person, your attorney or contact the software company’s support team.
Some operating systems and applications have a setting that allows you to periodically back up data to a cloud-based location or server on an automatic basis (i.e. iCloud or Google Drive). If you have this capability you should enable automatic data back-ups.
Periodically Check in on Data Preservation.
Set periodic reminders to continue to check on data preservation. While you should have already turned off automatic deletion and turned on automatic device back-ups, it is recommended that you periodically verify that your data is continuously being preserved. This includes continuing to check-in with IT and any additional individuals who also received the litigation hold notice. You should also continue to communicate with your attorney and any other ESI professionals you are working with as this process continues.
While these steps do not encompass the entirety of the preservation process, this process will demonstrate a reasonable effort to preserve data, which will provide protection against claims of spoliation and penalties associated with the deletion of relevant information.
Written by Amy Demanchick, paralegal for Adams Leclair LLP.
In 2018, the New York Court of Appeals issued a landmark insurance law decision in Keyspan Gas East Corp v. Munich Reins. Am., Inc., et al, 31 NY3d 51 (2018), holding that an insured can be held responsible for indemnification of claims occurring during periods when it was uninsured, even when relevant insurance was not available on the market during those time periods. In rejecting the “unavailability rule” used in several other jurisdictions, the Court of Appeals made clear that, where insurance policies provide for “pro rata” risk allocation, an insured will bear the risk for policy periods in which it did not have coverage, regardless of the reason for the lack of coverage.
The Court of Appeals emphasized in Keyspan that New York has not adopted either a strict “pro rata” or “all sums” allocation rule for apportioning costs among insurers in long-tail product liability or environmental suits. These cases present unique challenges because the alleged harm is gradual and continuous, and can span multiple insurance policy periods, including periods when insurance was either not available or not purchased by the policyholder. Accordingly, courts in multiple jurisdictions have been charged with determining the proper distribution of liability between multiple insurers, and between insurers and the insured.
In New York, whether a particular insurance policy should be subject to a “pro rata” or “all sums” allocation turns on the specific language of the policy, and particularly on whether the policy includes so-called “non-cumulation provisions” that contemplate coverage spanning multiple policy periods. The Court of Appeals has provided substantial guidance in distinguishing between terms which dictate pro rata vs. all sums allocation, including discussions of non-cumulation provisions in cases such as Consolidated Edison Co. of NY v. Allstate, 98 NY2d 208 (2002), Matter of Viking Pump, 27 NY3d 244 (2016) and in Keyspan.
Keyspan only addressed the allocation of indemnification costs and did not tackle the question of whether or how defense costs should be divided among insurers and insured. The Southern District of New York has now addressed this issue in Danaher Corp. v. Travelers Indemnity Co., 2019 414 F.Supp.3d 436 (SDNY 2019), a complex insurance coverage dispute that has been in litigation since 2012. Danaher, the plaintiff, is the former owner of Chicago Pneumatic, a manufacturer of various products that continue to give rise to both asbestos and silica-related bodily injury claims. In 1987, Danaher sold Chicago Pneumatic to Atlas Copco, now a third-party defendant in the suit. Danaher brought the action to resolve disputes over insurance coverage among Chicago Pneumatic’s insurers, including Travelers, who issued various primary insurance policies to Chicago Pneumatic prior to 1987, excess insurers, and the companies themselves, who did not have insurance policies for the entire period which gave rise to these claims. (Danaher no longer has an ownership stake in Chicago Pneumatic, but indemnified Atlas Copco against certain liabilities in connection with the sale of the company.) As of 2019, Danaher and Atlas Copco had incurred more than $8.7 million to defend the asbestos and silica-related injury claims, and more than $2 million in settling claims. This is in addition to the over $7.1 million in costs and fees incurred by Travelers in defending the claims. These costs continue to accrue- the parties have represented to the court that on average 70 new asbestos claims are filed each year against Chicago Pneumatic.
In 2012, the SDNY, after determining that several of Travelers’ policies covered the time periods at issue, granted Danaher and Atlas Copco’s summary judgment motion, determining that Travelers had the “duty to defend” the asbestos and silica claims against Chicago Pneumatic, and additionally had to reimburse the insured companies for defense costs incurred to that point. The Court left open the question of whether Travelers could recover contributions to defense costs from other insurers “for another day.”
In 2019, after seven years of litigation on the underlying claims, and after the Keyspan decision, Travelers brought a summary judgment motion seeking a declaration both that the liabilities at issue should be subject to “pro rata” allocation among the parties, commensurate to their “time on the risk,” and that it could seek contribution for both indemnity and defense costs from the other parties, relative to their “pro rata” obligations.
The SDNY agreed with Travelers that many of the relevant policies contain provisions which necessitate a pro rata method of allocation of indemnity costs. Following Keyspan’s dictate that the unavailability exception did not apply, it found both that other insurers were responsible for certain policy periods, and that the insureds themselves would be liable for periods there was no coverage. It further found that Travelers’ right to contribution “may be applied in the context of an insurer’s overpayment of both indemnification and defense costs.” As the court had determined that the insureds were “among the parties responsible for indemnifying” the claims, it concluded that there was “no compelling basis for excusing [the insureds] from contributing to defense costs for those periods as well.”
In November 2020, the SDNY rejected the insureds’ motion for leave to appeal. 2020 WL 6712193 (SDNY 2020) Danaher and Atlas Copco sought to bring an interlocutory appeal challenging the trial court’s finding that an insured, in some circumstances, has the obligation to contribute to defense costs for long-tail claims. The Court rejected the argument that such a finding was “contrary to New York law.” The Court reasoned that just as Danaher and Atlas Copco have an obligation to contribute to Travelers’ indemnification costs for the years in which Chicago Pneumatic was not insured, the same apportionment will apply to defense costs for those claims.
It’s important to note that Danaher, while confirming the ability of Travelers to seek contribution for defense costs post-litigation, also reaffirmed the court’s 2012 judgment that Travelers, “as the primary insurer of the risks of loss posed by the [claims] for a number of years. . . has a continuing duty to defend [those claims] in the first instance.” Danaher also presumes that such a division of costs will only apply “so long as defense costs can be readily apportioned.”
How this will work in practice is less clear. New York courts have long held that “the duty to defend. . . is a much broader duty than the duty to indemnify.” Continental Cas. Co. v. Employers Ins. Co. of Wausau, 60 AD3d 128, 142 (1st Dept. 2008). But the SDNY, relying on Keyspan, does not define how a “broader” duty translates into any differentiation in apportionment between and among insurers and the insured for indemnity liability and defense costs. And if an insured will eventually have to contribute to their own defense costs, is it in that company’s interest to wait until post-litigation for a contribution action, or should the issue be addressed up front?
Also note that this is the SDNY’s application of Keyspan. Whether the Court of Appeals will address this precise question is still to be seen. Finally, it is worth pointing out that whenever a company is on notice that it may be subject to long-tail claims for product liability or environmental damages, it is vital to conduct a thorough analysis of any applicable policies. The entire question of an insured’s contribution to defense costs only arises in the context of a pro rata allocation; if the insurance policies dictate an all sums approach, logically the insurers will be on the hook for providing the defense. In the meantime, insureds should be on notice that, particularly in complex long-tail claims, their insurers may seek contribution for defense costs.
Erin F. Casey is an attorney with Adams Leclair, LLP. Erin represents businesses and individuals in complex disputes in federal and state courts, in arbitration, and before governmental agencies.
Anthony Adams has been named to the Government Relations Committee for the Associated General Contractors of New York State for 2021.
Adams is a construction and litigation attorney for Adams Leclair LLP in Rochester, New York and has volunteered to serve in this capacity to help AGC advance the interests of its members and contractors generally with New York State and its agencies and authorities that participate in the construction marketplace or that regulate the industry, including the Office of General Services, the Dormitory Authority, the State University Construction Fund, the Department of Labor and others. Additionally, there can be as many as 300 construction-related bills considered by state legislators each year. These bills address such issues as: prevailing wage and other labor law matter; bidding; state contracting, environmental issues and changes to the Transportation and Vehicle and Traffic Law. Adams will contribute his legal experience and expertise to AGC and its staff as needed to pro-actively push for legal and contractual changes to benefit the construction industry.
Adams has spent much of his 40+year career representing contractors and other construction industry participants in contract negotiations, claims, public works issues, labor relations, risk management and other general business matters.