Friday, June 21, 2013

Breaking the Amish

Economic loss to innocent third-parties is often the collateral damage from contract disputes that land in court. Lapp’s Fresh Meats, an Amish-run stall at Joppatowne Plaza Shopping Center, has been sent packing.  According to a federal judge’s ruling last week, the popular vendor, which moved into the Joppa Market Place over two years ago, must shut down by June 23, 2013. The trusting Amish did nothing wrong. They simply got caught in the cross-fire between their landlord and another tenant. And it can happen to your business, too!

The decision follows a 2010 lawsuit filed by Redner’s Markets, which has a store in the plaza, against the shopping center’s owner, Baltimore-based Cordish Companies.  In 2005, this Pennsylvania grocery chain became an anchor tenant after signing a lease with Joppatowne G.P. Limited Partnership, a division of Cordish.  Redner’s agreed to pay $12 million over a 20-year lease that prohibits Cordish from leasing property within a five-mile radius of the shopping center to competing grocery shops.

Redner’s claims that the presence of a half-dozen Amish stalls inside the sprawling marketplace, including Lapp’s Fresh Meats, breaks this contract and siphons business from the grocer.  According to an accountant hired by Redner’s, the grocery chain has lost around $2.3 million in revenue because of the Amish Market.  

Cordish, however, defends the presence of the Amish stores, insisting that they fall within the term of the lease that makes exceptions for ethnic markets.

On June 13, U.S. District Judge Richard D. Bennett ended this two year debate with his ruling against Cordish, ordering the removal of Lapp’s Fresh Meats.  He determined, however, that the presence of several other food stalls in Joppa Market Place do not violate the contract.  Still, the fate of numerous shops remains uncertain and requires another trial.

Cordish will appeal the order forcing Lapp’s Fresh Meats to close.  Meanwhile, the Amish  butchers can only wait for others to determine their fate. If Judge Bennett stays (or postpones) the effect of his order, the market will continue to operate while the appeal winds through the U.S. Court of Appeals. If the order is not stayed, our Amish neighbors will be sent packing.

Fairness to third-parties is not always a core concern in business disputes. Maryland law goes far to protect the deal made by parties to the contract, and that includes restrictions on competition.  Here, a long-term tenant extracted a specific promise from the landlord that related businesses would not be set up to compete against the tenant's business within a five mile radius. The Amish certainly did not know about this restriction when they signed their own lease but enforcement of the restriction necessarily destroys the Amish butcher's business.

But the Amish are not without recourse- if they hire an "english" lawyer, they just might prevail against Cordish for breach of their own leasing agreement.

That would be fair.

Monday, June 10, 2013

Don't be a court jester!

Chad Johnson (the football player formerly known as "Ochocinco") has not been relevant as a professional athlete for some time, but in this video clip, he becomes a lesson in court decorum to all court litigants, criminal and civil.

Don't slap your lawyer on the butt to celebrate a victory!

Put more simply, show some sense, and show some respect for the courtroom setting.  It is a serious place where serious matters are discussed and resolved, including Mr. Johnson's freedom. Here, his lack of respect caused Broward County Circuit Judge Kathleen "Katie" McHugh to reject the plea bargain made by the prosecution and defense lawyers which would have kept the defendant out of jail.  She is a no-nonsense judge with 18 years under her belt as an experienced prosecutor.

Watch what happens.

What did you just see?  You watched a fellow who has made a career out of excessive celebration on the football field inject a bit of showmanship in his own criminal hearing. And the court took deep offense. The court then exercised it's discretion to reject a negotiated plea agreement.

A judge in criminal matters is not obligated to accept a plea bargain.  The parties negotiations are nothing more than a suggestion to the court.  The judge may accept or reject the deal. She also had the option to honor the plea agreement and hold Mr. Johnson in contempt, or constructive civil contempt. She chose the harshest route and sent Mr. Johnson to jail. Whether Katie McHugh's conduct survives further challenge can be debated, but isn't the more important thing to stay out of jail, in the first instance?

Thanks, Mr. Johnson, for being a teacher.

Epilogue:  Judge McHugh releases Mr. Johnson after seven days in the slammer, but extends his probation by three months.

Thursday, June 6, 2013

Maryland v. King: Your DNA on trial.

In 1994, the State of Maryland established a DNA database to catalogue samples from convicted sex offenders.  Five years later, the list of persons required to contribute to the DNA database was expanded to include all those convicted of violent crimes.   Three years later, it was expanded to include all those convicted of felonies.  On January 1, 2009, Maryland once again expanded the reach of DNA collection to all persons arrested  (not convicted) for violent crimes.

Later in 2009, Alonzo King was arrested for assault.  Pursuant to Maryland’s DNA collection statute, the State extracted DNA from his mouth, and found it matched DNA taken from the victim of a 2003 rape.  Mr. King was subsequently indicted and convicted of rape, and sentenced to life without parole.  On appeal, Maryland’s highest court ruled that the practice of taking DNA from those who have not been convicted, but merely been arrested for certain crimes, violated the Fourth Amendment’s proscription of unreasonable searches and seizures.  The United States Supreme Court disagreed.

In a 5-4 decision, the Supreme Court found Maryland’s expanded DNA collection procedures constitutional, likening the extraction of DNA from an arrestee’s mouth to standard identification techniques like: finger-printing, comparing the arrestee to wanted posters, and looking at external tattoos of the arrestee.  The Supreme Court recognized that the intrusion associated with a swab of an arrestee’s mouth is necessarily greater than a visual inspection of their person, but reasoned that the intrusion was slight compared to the state interest served.

Let’s take a step back and consider how DNA samples are collected.  The inside of the mouth is rubbed with a cotton swab, also known as a buccal swab.  Cheek cells adhere to the swab, which is then marked with the party’s identification and sent to a laboratory for testing.  The timetable for results varies but can take up to two weeks. 

Results are then registered in DNA databases, making it possible for law enforcement laboratories to electronically search and compare collected DNA profiles to crime scene evidence.  The Combined DNA Index System (CODIS) links all local, state, and national databases and contains more than 5 million records.

All 50 states take cheek swabs from convicted criminals to check against federal and state databanks, with the court’s blessing.  The Supreme Court issue revolved around whether that DNA collection could come before conviction and without a judge issuing a warrant.  Currently, the federal government and 29 states, including Maryland, take DNA swabs upon arrest.  Of these states, 13 limit DNA collection to people arrested for a felony, while the others limit it to those accused of certain felonies.

The practical impact of the decision is that Maryland’s legislators have been vindicated by crafting a crime-fighting statute that has survived the highest level of federal constitutional scrutiny.  With every cold-case solved, politicians are re-writing their campaign speeches to emphasize their involvement with the passage of such a monumental law.

But where does it end?  Currently, anyone arrested for certain crimes, like assault, rape, arson, etc. are subject to mandatory DNA extraction.  As the brief history of Maryland’s DNA database has shown, the persons subject to such DNA extraction continues to grow.  It isn’t long before a legislator, seeking to appear “tough on crime,” proposes such extraction for an even broader cross-section of the community.

Soon, “you have the right to remain silent” may pale in ubiquity to “open wide and say ‘Ah’.”

Wednesday, June 5, 2013

Setting limits so you can afford to litigate.

A lawyer can help you with a whole lot of things in your life.  Heck, as a young lawyer, I even waited tables at a client's restaurant when his waitress called in sick on a Saturday (I made $50 in tips). As an older lawyer, I now have some clients who find value in calling me for advice over a wide range of business and personal matters, sometimes on a daily basis, and without much concern for the cost. That is truly the exception.

As a general rule, new and existing clients hire the firm for a specific task, such as review of a contract ("can I cancel/enforce this deal?"), or to answer a specific question ("if my business partner steals all the money, will I personally owe on the LLC tax bill?"). These are called "limited scope representations." 

Our practice, which mirrors the practice of most law firms, is to write down the scope of our engagement, as agreed by our clients. This avoids heartburn for all- you know what is to be paid, and we know what must be done to get paid.

But litigation is slightly different. If hired to prosecute or defend a lawsuit in the state or federal courts of Maryland and the District of Columbia, your lawyer is subject to court rules dictating what must be done, and when a lawyer may get out of a case. And if you have limited resources, you have to understand how your desire for limited scope, and limited costs, can sometimes be out of your lawyer's control. Most litigation engagements are broadly written precisely because litigation can be a pandora's box of cost and expense.  But if you understand some of the moving parts, you can still craft a reasonable limited scope engagement.

A lawsuit is like a big, messy, sandbox where the other children may not play nice.  And it is very likely that nobody wants to be in the sandbox, to begin with.  The only moment you are in full control of your lawsuit is when it is filed.  But once filed, how your case proceeds, and at what cost, can be greatly influenced by others- the court, the clerks office, your witnesses, and certainly the opposing side. 

Every court system has general rules, published in books that all lawyers have, which dictate how and when things must be done.  And then there are standing orders that apply to a particular courthouse.  Within each courthouse, the individual judge may have standing orders about how cases run in his or her courtroom.  Now add the scheduling order issued by the Assignment Office for your case, often with a fixed administrative deadline when the case must be completed, and managing your case cost and expense just got complicated.

Your witnesses, particularly experts, cost money (non-experts get reimbursed for expenses, while experts also get paid for their expertise), and they have their own work schedules and family emergencies. The more witnesses you have, the more complicated scheduling court dates, depositions, and trial becomes. A subpoena will force a witness to appear, but reasonable accomodations to a witnesses needs makes for more cooperative witnesses.

Your opponent certainly has a different idea about the case.  In fact, disagreement with your opponent likely triggered the lawsuit, right? So don't expect accommodation, and don't expect cooperation.  As officers of the court, and as professionals, the attorneys will extend various scheduling courtesies to each other, but that does not include compromising your opponent's substantive claims and defenses. And when the parties can't agree, it usually triggers a court proceeding to decide the issue. And that means cost and expense to you!

How do you minimize your cost and expense? The ethical rules in both Maryland and the District of Columbia permit lawyers to make fee agreements that limit the scope of engagement.  And so, if you don't want to spend money on depositions, you can carve that out of the engagement.  Some of our clients have requested this type of limitation.  But please know that you cannot prohibit your opponent from requiring depositions, or from serving written discovery requests, and that will require some participation by your lawyer, which equals expense to you. You also cannot carve out a court's particular requirements, such as mandatory conferences, hearings, status reports, mediation, exhibit preparation and exchange, and motions. Each one of these equals cost and expense to you.

Litigation is a very effective tool to resolve disputes, recover damages, and to protect your business and property interests. If you have limited resources (as we all do!), discuss possible limitation of the engagement with your lawyer, and write it all down in the fee agreement.  And even after you establish a budget, expect some surprises created by the other side. The fee agreement may even require amendment as the case progresses. But if you work hand-in-glove with your lawyer, you can achieve your goals.