Epstein Becker Green Enjoins Landlord from Terminating Clients’ Gas Station Lease
Epstein Becker Green successfully prevented a landlord from terminating the commercial lease of clients Shell Oil Company and Motiva Enterprises LLC (collectively, "Shell/Motiva") at a gasoline service station in Suffolk County, Long Island. On Sept. 3, 2011, Shell/Motiva received a notice indicating that the landlord intended to terminate the lease within 30 days because of Shell/Motiva's allegedly unlawful use of the leased premises as a gasoline refilling station with a convenience store. (The certificate of occupancy permits the leased premises to be used as a gasoline refilling station with a garage.) On Sept. 30, 2011, Epstein Becker Green, on behalf of Shell/Motiva, immediately requested a temporary restraining order, which was granted that day. EBG subsequently filed a motion, on behalf of Shell/Motiva, seeking a "Yellowstone injunction" to stop the landlord from terminating the lease and ejecting Shell/Motiva from the leased premises.
On March 23, 2012, the Suffolk County Supreme Court granted the motion for a Yellowstone injunction. The court found that Shell/Motiva had met the criteria for the injunction, including demonstrating that they have the desire and ability to cure the alleged default. Additionally, the court pointed out that the landlord acknowledged that Shell/Motiva had already stopped using the leased premises as a convenience store. Based on the clear and unambiguous language of the lease, the court also rejected the landlord's argument that Shell/Motiva had an affirmative obligation to restore the automobile repair shop operation, which had been discontinued several years ago.
The EBG team representing Shell/Motiva consisted of New York Litigation attorneys William Ruskin and J. William Cook.
Massachusetts Superior Court Throws Out Tax Case Against Epstein Becker Green Clients
On June 1, 2015, Epstein Becker Green ("EBG") obtained the dismissal of a tax case brought by the owner of the Berkshire Mall (“Mall”) in the Massachusetts Superior Court. The Mall sought a declaration that certain taxes assessed by the Baker Hill Road District (“District”), which is located in the Town of Lanesborough, Massachusetts, were unauthorized and excessive. The Mall also claimed that the District’s tax assessments were “ultra vires” (i.e., beyond the District’s powers) and unconstitutional. EBG represented three individual officials of the District in this case.
The District was originally created to acquire and maintain a road that leads to the Berkshire Mall. In addition to assessing a tax to acquire and maintain that road, the District entered into four contracts relating to police, fire, and ambulance services. The District’s tax assessment, which was issued on January 2, 2015, incorporates the costs associated with these service contracts. The District has only three taxpayers.
With regard to the service contracts, EBG argued before the court that the Mall lacked standing to sue about the District’s alleged abuse of power by entering into the service contracts, because, under a state statute, this lawsuit must be started by a petition of not less than 10 taxable inhabitants of the town. The court agreed with EBG’s argument that, not only was this suit brought by less than 10 taxpayers, but the Mall could not qualify as a “taxable inhabitant” under the statute because the Mall is not a “natural person.” Moreover, even if the Mall could qualify as a taxpayer under the statute, there were only three taxpayers in the District—not enough to meet the 10-taxpayer threshold for the petition.
Next, regarding the Mall’s claim that the tax assessments were ultra vires and unconstitutional, the court agreed with EBG’s argument that the court lacked jurisdiction to hear this claim as well, since the Mall was required by law first to seek an abatement from the local board of assessors and, if denied, to appeal to the State Appellate Tax Board. However, the Mall failed to exhaust these administrative remedies before filing this lawsuit.
Member of the Firm Barry A. Guryan and Senior Counsel J. William Cook led the EBG team. The case is Comm 2005-FL10 Berkshire Mall LLC v. Baker Hill Road District, Civ. No. 2014-00355 (Mass. Sup. Ct., Berkshire Cty., 2015).
Winning Summary Judgment for Retailer in Real Estate Dispute
Epstein Becker Green has won a significant summary judgment motion as to all claims for its client Wakefern Food Corporation (“Wakefern”). The claims at issue were $24 million. Wakefern is the largest retailer-owned supermarket cooperative in the United States and manages the trademark for ShopRite Supermarkets. Wakefern was sued in the Eastern District of Pennsylvania (Arsenal Inc. et al. v. Ammons et al, 14-CV-1289) by a property developer who alleged that Wakefern and one of its member supermarkets caused the failure of plaintiff’s commercial development by pretending to be interested in locating a supermarket there while simultaneously planning to locate the supermarket at a competing development. Because the site related to the claims was a former military installation that had been a political issue for the last 25 years, the allegations against Wakefern were politically charged and closely followed in the region. After Wakefern’s initial motion to dismiss disposed of several claims, and after vigorous discovery on the remaining claims, for promissory estoppel, tortious interference, and negligent misrepresentation, plaintiff and defendants filed cross-motions for summary judgment. In a 25-page decision, Judge Anita B. Brody dismissed plaintiff’s three remaining claims, finding that Wakefern had made no enforceable promises to the developer, was under no obligation to enter into any lease with plaintiff, and had made no actionable misrepresentations.
The Epstein Becker Green team included Princeton attorneys Anthony Argiropoulos, Theodora McCormick, William Gibson, and Scheherazade A. Wasty.
Upholding Procedures That Limit the Dispensing of Opioids
While the tragic consequences of the opioid epidemic continue to make headlines, and manufacturers and retailers face lawsuits for distributing these potent and addictive painkillers, Epstein Becker Green recently defended a retailer that stood its ground by refusing to fill an opioid prescription.
In November 2016, the Office of Civil Rights (OCR) of the Department of Health and Human Services commenced an investigation of a drugstore chain client under Title VII of the Civil Rights Act of 1964, the Age Discrimination Act of 1975, and Section 1557 of the Affordable Care Act. The investigation was conducted in response to a customer complaint of age and race discrimination against our client due to its decision to decline to fill an opioid prescription issued by an out-of-state physician. At issue was the validity of our client’s procedures for validating and dispensing controlled substances. After the investigation, in May 2017, OCR concluded that our client acted consistently with its procedures and did not discriminate against the patient. Accordingly, OCR declined to issue a complaint against our client, and the proceedings concluded.
The OCR decision validated the use of our client’s procedures in all of its pharmacies for filling opioid prescriptions. These procedures comply with federal and state law relating to dispensing controlled substances without violating laws prohibiting places of public accommodation from discriminating against customers with disabilities or due to race, gender, or age. OCR’s decision not to issue a complaint eliminated a threat of the application for an injunction that would have affected all of our client’s stores.
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Protecting Companies That Use Chatbots for Certain HR Functions
Increasingly, companies are using “chatbots” for lower-level human resources (HR) functions, such as tracking employees’ paid time off, leave, or benefits. (A “chatbot” is a computer program that uses artificial intelligence (AI) to simulate conversation with human users—for example, a chatbot may appear in a pop-up window on a website that asks whether a visitor needs any assistance.) Some companies are even evaluating whether they should complement humans with chatbots to take in internal complaints of discrimination or harassment. Although management and HR personnel may embrace chatbots to increase efficiency and reduce subjectivity, there are legal risks involved with adopting this technology.
Epstein Becker Green provides advice and counsel to clients that use, or are considering using, chatbots and want to mitigate their legal risks. We recently assisted clients in the retail and financial services industries with their chatbots. Our attorneys evaluated the questions asked by these chatbots to ensure that the algorithms, among other things, are able to distinguish between various types of employee requests—such as requests for sick leave, Family and Medical Leave Act leave, a regular day off, or an accommodation under the Americans with Disabilities Act. In addition, we made sure that our clients' chatbots have built-in processes to elevate certain matters for human review and are creating a favorable experience for employee-users.
Helping HR Departments Minimize Risk When Using AI Tools in Hiring
Human resources (HR) departments are progressively turning to artificial intelligence (AI) tools to assist in the process of recruiting and vetting job applicants. AI vendors claim that their tools can quickly and seamlessly identify the best candidates for open positions. Despite such claims, these tools have the potential to perpetuate stereotypes, disparately impact certain populations, and present troublesome issues relating to people with disabilities—leaving employers vulnerable to class or collective actions.
Epstein Becker Green understands both the promise and pitfalls of AI, and our attorneys have experience counseling clients on how to maximize the benefits of AI in recruitment and selection while minimizing potential risks. Recently, two clients—a major financial institution and a restaurant chain—sought Epstein Becker Green’s help in evaluating AI vendors for their employee recruitment, selection, and onboarding functions. Our attorneys assisted our clients in assessing the product offerings, reviewing vendor contracts, identifying the appropriate questions to ask the vendors about their AI products, monitoring and testing those products, and evaluating whether those products would raise red flags from a legal perspective.