The Lawletter Vol 40 No 11

Alistair Edwards—Senior Attorney, National Legal Research Group

     Does a party buying mineral rights have to disclose to the vendor before the sale that it already has a deal in place to sell the mineral rights to a third party for a much higher price? In McCarthy v. Evolution Petroleum Corp., 2014-2607 (La. 10/14/15), 2015 WL 5972515, the court recently considered the novel issue of whether a mineral lessee who had purchased the lessor's mineral rights was liable to the lessor under a fraud-by-silence claim when the lessee failed to disclose to the lessor at the time of the purchase that it had already negotiated the resale of the rights to a third party for a significantly higher price.

     In considering this issue, the court pointed out the well-established rule (codified by Louisiana statute) that "[a] mineral lessee is not under a fiduciary obligation to his lessor, but he is bound to perform the contract in good faith and to develop and operate the property leased as a reasonably prudent operator for the mutual benefit of himself and his lessor." La. Rev. Stat. Ann. § 31:122. This language, which focuses on mineral development operations, not the selling of mineral rights, did not, according to the court, impose on the lessee/purchaser a duty to disclose to the lessor/vendor that the lessee already had a deal in place to resell the mineral rights to a third party for a much higher price.

The Lawletter Vol 40 No 11

Anne Hemenway—Senior Attorney, National Legal Research Group

     There are a variety of reasons why a federal bankruptcy case may be reopened after the debtor has been discharged and the case closed. A debtor may discover a claim, not known at the time the case was pending, and seek to reopen the case to discharge the claim. More typically, a Chapter 7 trustee may seek to reopen a case after discovering potential bankruptcy estate assets that the debtor failed to schedule. The party seeking to reopen may find intense challenges to the motion to reopen, because the reopening can result in a major redistribution of assets. Under the Bankruptcy Code, the bankruptcy court has broad discretionary authority to reopen a case "to administer assets, to accord relief to the debtor, or for other cause." 11 U.S.C. § 350(b).

     Recently, in In re Ludvigsen, BAP No. MB 14-039, Bankr. No. 13-12232-WCH, 2015 WL 3733193 (B.A.P. 1st Cir. Jan. 16, 2015) (not for publication), the First Circuit Appellate Panel stated that a bankruptcy court properly exercises its discretionary authority to reopen a closed bankruptcy case when it does so to determine a substantive dispute on its merits, but does not exercise proper discretionary authority when only technical defects with the closed case are at issue. Further, when determining whether to exercise its discretionary authority, the court should look at each § 350(b) motion on a fact-by-fact basis. Id. at *4 (citing In re Dalezios, 507 B.R. 54, 58 (Bankr. D. Mass. 2014).

The Lawletter Vol 40 No 10

Matt McDavitt, Senior Attorney, National Legal Research Group

     It is well settled under workers' compensation law nationally that, generally, worker injuries occurring coming to, or going from, work are not compensable in nature. However, an important exception to this rule exists regarding accidents in which workers are traveling in employer-supplied vehicles, where the worker is off duty but remains on call. For example, given that city police departments receive a benefit by having their police officers on call for duty at a moment's notice while driving their police cruisers, so long as the travel has some relation to employment, injuries received during such travel are compensable.

[W]e are satisfied that the City enjoyed sufficient benefits from Ms. Ross's participation in the take-a-car-home program to affirm the Commission's determination of eligibility. The City does not dispute the Commission's conclusion that the City benefitted from the program by having more officers available for immediate response, from better care of patrol cars, and from increased police visibility. Officers with take-home cars were prepared to respond to emergency calls at any time. These officers always had at hand those items required to be kept in the take-home patrol cars, including their service gun, police radio, identification, flashlight, ticket book, report forms, and flares.

The Lawletter Vol 40 No 10

Fred Shackelford, Senior Attorney, National Legal Research Group

     Can damages for emotional distress be recovered in a nuisance claim in the absence of physical injury? That was one of three issues of first impression that were recently addressed by the Nevada Supreme Court. In Land Baron Investments, Inc. v. Bonnie Springs Family LP, 356 P.3d 511 (Nev. 2015), a purchaser (Land Baron) contracted to buy land on the outskirts of Las Vegas. The land was largely undeveloped, and the buyer intended to construct a subdivision there. Land Baron conducted no due diligence to investigate the availability of water and access rights, and these issues were not addressed in the contract.

     Before the closing occurred, it became apparent that Land Baron would be unable to acquire sufficient water and access rights for the proposed project. Land Baron stopped making payments to extend the escrow period, thereby breaching the contract. Land Baron then filed a complaint with the Clark County Commissioner's office, alleging that there were multiple code violations on the property. The Commissioner and other state and local authorities conducted a large-scale investigation on the premises at a time when guests and children were present.

The Lawletter Vol 40 No 10

Dora Vivaz—Senior Attorney, National Legal Research Group

      The intracorporate conspiracy doctrine was created to shield corporations and their employees from liability for routine, collaborative business decisions that are later alleged to be discriminatory. E.g., Tabb v. District of Columbia, 477 F. Supp. 2d 185 (D.D.C. 2007). Although the doctrine was initially crafted in the context of the Sherman Act, the courts have extended its reach to many other contexts, including claims brought under civil rights and other antidiscrimination laws. See, e.g., Blades v. Countrywide Home Loans, Inc., No. CIVA1:06CV1000LG-JMR, 2007 WL 2746678 (S.D. Miss. Sept. 18, 2007) (available on WL and Pacer). The courts have not necessarily agreed on just how far the doctrine should be extended, however. See id. (and cases cited).

      In a recent case, for example, the federal district court noted that while the doctrine applies in the Sixth Circuit to conspiracy claims under 42 U.S.C. § 1985, it is unclear whether it also applies to claims under 42 U.S.C. § 1983. See Engle v. City of Cuyahoga Falls, No. 5:14-CV-1161, 2015 WL 3852143 (N.D. Ohio June 22, 2015). In fact, it appears that the district courts within the Sixth Circuit continue to disagree on whether the doctrine should apply to § 1983 cases. Id.

The Lawletter Vol 40 No 9

Suzanne Bailey, Senior Attorney, National Legal Research Group

     Whether you believe that quarterback Tom Brady was aware that the New England Patriots were using allegedly deflated footballs during the January 18, 2015 AFC Championship Game between the Patriots and the Indianapolis Colts or whether you are unsure what sport the Patriots and Colts play or whether they play the same sport, the recent decision by U.S. District Judge Richard M. Berman in National Football League Management Council v. National Football League Players Ass'n, Nos. 15 Civ. 5916 RMB JCF, 15 Civ. 5982 RMB JCF, 2015 WL 5148739 (S.D.N.Y. signed Sept. 3, 2015), appeal filed, No. 15-2805 (2d Cir. Sept. 3, 2105), vacating the arbitration award in favor of the National Football League ("NFL"), provides a valuable primer on basic notice and hearing requirements under the Federal Arbitration Act ("FAA").

     As has been well publicized, shortly after the conclusion of the January 18, 2015 game, the NFL retained Theodore V. Wells Jr. and the law firm of Paul, Weiss, Rifkin, Wharton & Garrison ("Paul, Weiss"), to conduct an independent investigation—along with NFL Vice President and General Counsel Jeff Pash—into the use of underinflated balls. The source of authority for the investigation was the NFL Policy on Integrity of the Game and Enforcement of Competitive Rules ("Competitive Integrity Policy").

The Lawletter Vol 40 No 9

Steve Friedman, Senior Attorney, National Legal Research Group

     One of the bedrock principles of American jurisprudence is the freedom of religion guaranteed by the First Amendment. See U.S. Const. amend. I. More recently, the law had mandated that disabled students are to receive certain minimum educational benefits at public expense. See 20 U.S.C. §§ 1400–1491o (Individuals with Disabilities Education Act ("IDEA")); 29 U.S.C. § 794 (Rehabilitation Act of 1973 ("RA")). At times, these two distinct rights may overlap and conflict with one another. As illustrated by two fairly recent cases, however, public schools need not accommodate the student's (or the parents') religious beliefs in providing a free appropriate public education ("FAPE") as required by the IDEA and the RA.

      In M.L. ex rel. Leiman v. Starr, No. PWG-14-1679, 2015 WL 4639569 (D. Md. filed Aug. 3, 2015), appeal filed, No. 15-1977 (4th Cir. Aug. 27, 2015), the parents of a child with an intellectual disability brought suit against Maryland's Montgomery County Board of Education, alleging that the Board had failed to provide the student with a FAPE as required by the IDEA. The student is part of the Orthodox Jewish community, and, thus, it is very important to his parents that he learn the rules and customs of Orthodox Jewish life. Consequently, the parents sought an individualized education program ("IEP") that placed the student at a private school where the basics of Orthodox Jewish life are a part of the curriculum. Instead, the school district proposed an IEP that placed the student at a public school that did not include instruction on Orthodox Jewish life.

The Lawletter Vol 40 No 9

Charlene Hicks, Senior Attorney, National Legal Research Group

     For a prevailing party in a civil lawsuit to obtain attorney's fees, he or she must file a motion requesting fees by a statutory deadline. Problematically, however, many state statutes do not specify whether this deadline is tolled by the filing of a postjudgment motion. As a result, counsel may be placed in the awkward position of deciding whether to move for attorney's fees while the losing party's postjudgment motion is pending before the court.

      The effect of a postjudgment motion on the time in which a prevailing party must move for attorney's fees was recently addressed in Barbara Ann Hollier Trust v. Shack, Nos. 63308, 64047, 2015 WL 4656697 (Nev. Aug. 6, 2015). There, the court noted that Rule 54(d) of the Nevada Rules of Civil Procedure requires a prevailing party to move for attorney's fees within 20 days after service of notice of entry of judgment. However, in the case before the court, the losing party filed a motion for judgment notwithstanding the verdict or, alternatively, for a new trial before the prevailing party moved for attorney's fees. The prevailing party did not file any motion for attorney's fees until after the court denied the losing party's postjudgment motions.

The Lawletter Vol 40 No 8

Brad Pettit, Senior Attorney, National Legal Research Group

     In 2014, an Indiana appellate court considered the issue of whether a landlord can enforce a provision in a residential lease contract that seeks to protect it from liability for personal injuries caused by fungus or mold on the leased premises. In Hi-Tec Properties, LLC v. Murphy, 14 N.E.3d 767 (Ind. Ct. App.), transfer denied, 20 N.E.3d 851 (Ind. 2014), a tenant who leased an apartment that was below ground level brought suit against her landlord, alleging, inter alia, that mold in the apartment had aggravated her preexisting asthma and caused other injuries. The landlord defended against the tenant's claim by pointing to a clause in the parties' lease agreement that read in pertinent part as follows:

The Lawletter Vol 40 No 8

Brett Turner, Senior Attorney, National Legal Research Group

     In In re Marriage of Iqbal & Khan, 2014 IL App (2d) 131306, 11 N.E.3d 1, the two parties, of the Islamic faith, signed a separation agreement ("PNA"). The PNA named a prominent member of the local Islamic community as Counselor. It then provided:

     Husband and Wife agree that an unreasonable divorce (without Counselor's express written approval) is a violation and contrary to the purposes and intents of this agreement, and an unreasonable divorce sought by either party will forfeit their rights to custody of the children and any rights conveyed in this agreement. If either party seeks an unreasonable divorce, they hereby agree to surrender full custody rights to the other, and agree to only reasonable visitation rights to the Children.

Id. ¶ 28, 11 N.E.3d at 10 (quoting PNA).