The Legal Intelligencer Blog

Aggrieved Parties and Their Right to Appeal

By James W. Cushing
Special to the Legal

The Rules of Civil Procedure are designed to facilitate litigation so it can be performed smoothly and predictably. Unfortunately, one simply cannot predict and write a rule for every possible contingency that could happen in the life of a case. There will always be circumstances that seem to fall into the cracks between the rules.

Pa.R.C.P. 1028(a)(1) requires a complaint be dismissed when the court lacks jurisdiction over the subject matter and/or the parties to a claim. Pa.R.C.P. 1028(5) requires a complaint be dismissed when a plaintiff lacks standing to file one on the issues contained therein. What if a plaintiff sues two defendants in municipal court, wins a judgment for jurisdictional limits against only one defendant but files an appeal to the court of common pleas against both parties despite having won as much as legally permitted against one of the defendants?

Although, pursuant to 42 Pa.C.S.A. §5105, a party may file an appeal from a final order, it could be argued that only an aggrieved party may file an appeal, as in Pierro v. Pierro, 434 Pa. 131 (1969). Pennsylvania case law has something to say on this subject: “Standing [to file an appeal] requires an aggrieved party, and one ‘who is not adversely affected in any way by the matter which he seeks to challenge is not ‘aggrieved’ thereby and has no standing to obtain a judicial resolution of his challenge,’” as the court held in Lisa H v. State Board of Education 67 Pa.Cmwlth. 350 (1982), quoting William Penn Parking Garage v. City of Pittsburgh, 464 Pa. 168 (1975).

If our hypothetical plaintiff above won a judgment against one of the defendants for full jurisdictional limits in municipal court, it could be argued, per the above case law, that the plaintiff is not an aggrieved party, as he won his case against the defendant as completely as possible according to his own complaint and the municipal court rules. As he is not aggrieved, it could be argued, he has no standing to file an appeal of that judgment to the court of common pleas against that defendant. If the plaintiff had no standing and, therefore, could not file an appeal of the judgment, the court of common pleas, theoretically, has no jurisdiction over the person or subject matter at issue as it pertains to that one defendant.

The statute and cases seem to point in the direction that only a truly aggrieved party can file an appeal. Unfortunately, there seems to be a conspicuous absence among the relevant cases and statutes as to precisely whether a party that completely wins its case against a party, particularly in municipal court, is actually an aggrieved party with the right to appeal. It would seem that this issue is ripe for testing in the courts as soon as the opportunity arises.

James W. Cushing is an associate at the Law Office of Faye Riva Cohen P.C., research attorney for Legal Research Inc. and sits on the board of directors of the Christian Legal Clinics of Philadelphia.

Superior Court Offers Refresher Course on Appeals Procedures

By James W. Cushing
Special to the Legal

The recent Pennsylvania Superior Court matter of J.J. DeLuca v. Toll Naval Associates, 2012 Pa.Super. 222, involved a large construction contract, alleged breaches of that contract and allegations of fraud over the life of the relationship of the parties in this case. Although the underlying case is interesting, the focus of this article is what amounted to the primer the court gave in its opinion regarding appellate practice.

After a verdict and an appeal and remand of the same, the trial court again calculated damages that were appealed again by both parties. On appeal, DeLuca raised a whopping 16 issues while Toll raised nine. When faced with potentially 25 issues raised on appeal, the court recalled U.S. Court of Appeals for the Third Circuit Senior Judge Ruggero J. Aldisert’s statement in his opinion prepared in the case of Kenis v. Perini, 452 Pa.Super. 634 (1996), when he said, “When I read an appellant’s brief that contains 10 or 12 points, a presumption arises that there is no merit to any of them. I do not say that it is an irrebuttable presumption, but it is a presumption that reduces the effectiveness of appellate advocacy. Appellate advocacy is measured by effectiveness, not loquaciousness.” When reviewing DeLuca’s issues raised on appeal, the court further observed that they often overlapped with one another and were inconsistently numbered and lettered.

Some of DeLuca’s arguments regarded the sums of money paid by Toll at one point during the matter. Despite DeLuca’s taking the time to make the arguments, they had virtually no references to places in the record to support their claims. The court noted that Pa.R.A.P. 2119(c) requires references made to pleadings and evidence and such to be specifically cited to in the record. Indeed, the court, citing Commonwealth v. Imes, 603 Pa. 680 (2009), specifically said it would not “scour the record to find the evidence to support an argument.” As a result, the insufficiently cited claims were deemed waived by the court.

The subsequent argument raised by DeLuca presented a conclusory statement without any supporting authority and was therefore deemed waived by the court. DeLuca’s next argument was quickly deemed “demonstrably incorrect” by the court when compared to the clear testimony of the record. DeLuca’s argument after that was also deemed waived because “DeLuca has failed to develop an argument in support of its … claim, and offers no authority at all to support it.” DeLuca also proposed an argument based on the statute of limitations. The court ruled this argument, too, was waived, as “DeLuca [did] not present any citation to the record to support its claim, or to show where Toll’s evidence was deficient.”

Indeed, another of its arguments was dismissed because DeLuca offered “no other substantiation or explanation” aside from a bald assertion offering “no other support of its claim,” not to mention that it “fail[ed] to present or develop an independent argument in support of its claim.” Furthermore, the court noted that DeLuca’s arguments did “nothing to refute the trial court’s findings.” When reviewing DeLuca’s arguments regarding punitive damages, the court indicated that they were “incomplete” and ignored certain issues and/or merely “incorrectly assumed it would prevail on its assertion[s].” The court also believed that DeLuca “misapprehend[ed the court’s] standard of review” and misapplied (or misunderstood) certain constitutional requirements.

As stated above, the Superior Court’s decision is useful as guidance on what to do (or not do) when filing an appeal. First, when filing an appeal, make the issues on appeal concise, specific and clear, as opposed to sprawling, numerous and repetitive. Second, be sure to cite to the record at all times whenever possible, as the court will not do your work for you in this regard. Third, and this seems quite obvious, one’s arguments must be fully developed, based on the facts and evidence available, supported by authority and the record, consistent with the law and clearly explained and articulated to the court.

James W. Cushing is an associate at the Law Office of Faye Riva Cohen and research attorney for Legal Research Inc. He is licensed to practice law in both Pennsylvania and New Jersey.

USPS Listens to Deaf Employees’ Claims

By James W. Cushing
Special to the Legal

The matter of Hubbard v. Donahoe, Civil Case No. 03-1062, U.S. District Court for the District of Columbia, is a class action lawsuit that pits the United States Postal Service against its deaf and hard-of-hearing employees.

The Equal Employment Opportunity Commission brought a class action suit on behalf of various deaf employees USPS alleging that the USPS denied them communication accommodations (e.g., American sign-language interpreters), especially during meetings, refused to provide them a TTY for telephone communication, failed to give them emergency evacuation notification systems, did not promote them or provide assistance in their effort to get promoted, and subjected them to a hostile work environment as a direct result of their disabilities.

After about 10 years of litigation, the parties have finally submitted a class action settlement agreement to the District Court for $4.55 million.

Over the course of my life, I have been involved in the deaf culture in one way or another and I have learned that although most people think of not being able to hear as the disability of a deaf person, the challenges the deaf have in the simplest act of communication with a hearing person are perhaps the disability that most impacts their lives each day. The inability to effectively communicate serves to isolate the deaf person – likely the only one at a given employment location – and therefore completely separate him from the rest of his co-workers. Therefore, failing to provide an interpreter or basic emergency systems or even a telephone (i.e., TTY) compounds a deaf person’s disability and enhances his or her isolation. I can think of few things that would make a work environment more hostile than near complete isolation.

Regardless of the merits of the case, it reminds us that those with disabilities are equal members of our society and our workforce and all have value. A case like this serves as an important reminder that employers all have the obligation to ensure that they honor their responsibility to take reasonable measures to accommodate the disabilities of their employees and to ensure that the workplace is one in which the employees feel comfortable.

James W. Cushing is an associate at the Law Office of Faye Riva Cohen and research attorney for Legal Research Inc. He is licensed to practice law in both Pennsylvania and New Jersey.

A Reminder to File Post-Trial Motions

By James W. Cushing
Special to the Legal

The matter of DeLage Landen Financial Services v. Rovner Allen, 85 Bucks Co. L. Rep. 983 (2012), reminds practitioners to be vigilant in protecting their clients’ appeal rights at the conclusion of trials.

In DeLage, the defendant, Rovner Allen, lost at trial and immediately appealed directly to the Pennsylvania Superior Court without filing any post-trial motions. The court ruled that a party that wishes to appeal an adverse decision must file post-trial motions in order to preserve the issues the party wishes to raise on appeal, otherwise the issues are waived. Indeed, the court indicated that failing to file a post-trial motion is fatal to an appeal and a mandatory prerequisite to filing an appeal.

The DeLage court’s decision was based on the Pennsylvania Supreme Court decision in Chalkey v. Roush, 569 Pa. 462 (2002). The fact pattern in Chalkey is remarkably similar to DeLage in terms of the issues addressed in this article. In Chalkey, the court ruled that after a verdict is reached by either a judge or jury in either a matter of equity or law, Pa.R.C.P. 227.1 requires all issues to be potentially raised on appeal to be preserved in post-trial motions or they are otherwise waived. Indeed, Pa.R.C.P. 227.1 is consistent with the also applicable Pa.R.A.P. Rule 302(a), which lays out the general rule that “issues not raised in the lower court are waived and cannot be raised for the first time on appeal.” One way to raise an issue in the lower court is through the filing of a post-trial motion.

An interesting tidbit in the Chalkey matter is that the trial court judge, sitting in equity, did not enter a decree nisi pursuant to Pa.R.C.P.. 1517(a) (which was rescinded in 2003), which gave the appellant the impression that a post-trial motion was not required. Further, before the matter reached the Supreme Court, the Pennsylvania Superior Court relied upon Pa.R.C.P. 1517 and 1518, both of which deal directly with appealing matters of equity. Unfortunately, while both of the aforementioned rules were rescinded (Rule 1517 in 2004 and 1518 in 1984) and replaced by Pa.R.C.P. 227.1, the Supreme Court noted that confusion had arisen as there was little to no guidance from the court as to whether the cases decided under the aforesaid rescinded rules had been abrogated. Therefore, the Chalkey court made it abundantly clear and definitively ruled that there is “no excuse for a party’s failure to file post-trial motions,” period, regardless of whether the trial was heard by a judge or jury in either a matter of equity or law; they must be filed in order to have any issues preserved for appeal.

So, let the above cases serve as a valuable reminder to practitioners that in order to preserve any and all issues one wishes to argue on appeal after a trial, post-trial motions must be filed within 10 days of the trial verdict/decision one wishes to appeal.

James W. Cushing is an associate at the Law Office of Faye Riva Cohen and research attorney for Legal Research Inc. He is licensed to practice law in both Pennsylvania and New Jersey.

The Effect of Retiring on Workers’ Compensation Benefits

By James W. Cushing
Special to the Legal

The matter of Krushauskas v. Workers’ Compensation Appeal Board, 56 A.3d 64 (Pa.Cmwlth. 2012), involved a claimant who suffered a work-related injury while working as a stock picker for General Motors. Claimant Thomas Krushauskas filed a penalty petition against GM alleging it unilaterally suspended his benefits without any additional agreement or order. Simultaneously, Krushauskas voluntarily entered GM’s attrition plan and accepted early retirement. The court noted that no one was forced into the attrition plan and, in fact, Krushauskas had 45 days to revoke the decision to enter it. Krushauskas argued that he did not intend to retire and was simply taking advantage of the plan offered.

The court ruled that GM violated the Workers’ Compensation Act when it unilaterally – without agreement or court order as a result of Krushauskas’s retirement – suspended Krushauskas’ benefits because of him retiring per his entrance into the attrition plan. Generally, an employer is supposed to file a petition specifically requesting the relief sought. Despite this, the court noted that it has never required unreasonable strictness in workers’ compensation pleadings. Unfortunately for Krushauskas, because the court also ruled that he did, indeed, retire, the unilateral suspension did not cause any loss in workers’ compensation benefits owed to him.

The court’s ruling that Krushauskas did retire, contrary to his argument that he did not actually intend to do so, was based on a credibility determination of Krushauskas’ testimony. As stated above, Krushauskas’ representations in the documentation for the attrition plan indicated retirement and the court found those representations likely to be true.

Perhaps the most significant aspect of the court’s ruling is that it clarified and consolidated previous rulings that a workers’ compensation judge has the authority to suspend/terminate a claimant’s benefits without a formal petition from the employer as long as doing so would not be prejudicial to the claimant. A claimant having an opportunity to defend him or herself, and/or having adequate notice, would tend toward the matter lacking prejudice against the claimant even if the workers’ compensation procedures were not followed with precision.

The court noted, based on the facts presented, that Krushauskas certainly had sufficient notice and knew a suspension of benefits was possible. Indeed, the court drew significance from the fact that when GM argued that Krushauskas voluntarily retired, he objected on the basis of relevance, and not surprise, which would have been the objection if he did not have sufficient notice. Furthermore, Krushauskas never attempted to submit additional evidence to oppose the argument that he voluntarily retired.

The court further indicated that where someone accepts a retirement pension, as Krushauskas did here, then the employer is entitled to a suspension of benefits. Benefits will be suspended unless the claimant can show that he is seeking employment or he was forced into retirement because of a work-related injury. In the instant case, Krushauskas clearly accepted a retirement pension and never testified to seeking new or continued employment.

When collecting workers’ compensation, be sure to consider all implications before accepting a retirement plan or pension, as the workers’ compensation benefits may be terminated long before expected.

James W. Cushing is an associate at the Law Office of Faye Riva Cohen and research attorney for Legal Research Inc. He is licensed to practice law in both Pennsylvania and New Jersey.

Is It A-OK Withdrawing From a 401(k) for UC?

By James W. Cushing
Special to the Legal

A question was recently posed to me asking whether a withdrawal from a 401(k) would cause one’s unemployment compensation benefits to be denied, be diminished or even cease if already in payment. The answer to this inquiry is not totally clear.

43 Pa.C.S.A. 804(d)(2)(i) states: “Periodic payment, under a plan maintained or contributed to by a base period or chargeable employer, the weekly benefit amount payable to such individual for such week shall be reduced, but not below zero, by the pro-rated weekly amount of the pension as determined under Subclause (ii)” and 43 Pa.C.S.A. 804(d)(2)(ii) states: “If the pension is entirely contributed to by the employer, then one hundred per centum of the pro-rated weekly amount of the pension shall be deducted. … [I]f the pension is contributed to by the individual, in any amount, then fifty per centum of the pro-rated weekly amount of the pension shall be deducted.”

The obvious questions that arise are, is a 401(k) a pension under the above statutes, and what if someone withdraws funds from their 401(k) before he is of retirement age as one would withdraw funds from a bank account? Answers to these questions are not readily forthcoming from the cases decided under the unemployment compensation law, but need to be parsed from cases dealing with other retirement vehicles (Wise v. Unemployment Compensation 707 A.2dc 627 (Pa.Cmwlth. 1997)).

After a review of the Wise case, it appears that if someone withdraws money from a 401(k) after he has reached an age of 59½, which enables the withdrawal to be made without a penalty, then the statutory guidelines laid out above apply and unemployment compensation benefits are reduced, possibly to zero. If someone is under the age of 59½ and rolls over the funds in his 401(k) into another retirement vehicle/investment in order to avoid the penalty for withdrawal, but does not withdraw any of the funds in it, then the above guidelines laid out do not apply and the unemployment compensation claimant can receive benefits without the statutory reduction in the same. Indeed, the Wise court opined that a roll over is not actual receipt of the funds and the claimant ought not be penalized with a reduction of unemployment benefits.

Unfortunately, courts generally have not directly addressed a situation in which someone who is under 59½ withdraws all of his funds from his 401(k), and pays the 10 percent penalty required for so. The court appears to imply that it does not believe it is just, or consistent with legislative intent, to make someone pay a penalty on the withdrawal and also be subject to a reduction of unemployment compensation benefits per the above statutory guidelines, as that would amount to a double penalty; however, the court did not rule on this scenario.

One question that the court does not appear to have addressed at all is if a claimant withdraws all funds from a 401(k) (with penalty) under the age of 59½, which could lead to a reduction of unemployment compensation benefits, does it matter if the contributions were made solely by the claimant, were made solely by the employer or the contributions came from both sources. If the 401(k) is comprised entirely of a claimant’s own contributions, would not those assets be his own as if he had contributed to a bank account, which would not affect benefits at all under normal circumstances? Are an employer’s contributions somehow different?

Per the Wise court’s dicta, one could reach the conclusion that one can withdraw all funds from a 401(k) under the age of 59½, pay the penalty for doing so, and still be eligible for the full unemployment compensation benefit amount. In saying that, however, due to government budget constraints and current economic conditions, the Department of Labor (and sometimes the courts) has been trending toward finding and justifying reasons to reduce or eliminate unemployment compensation benefits. Indeed, even if a claimant would be ultimately successful using the arguments laid out above, I would not at all be surprised if the Unemployment Compensation Board of Review, taking advantage of the ambiguity described above, would rule an under-59½ year old claimant ineligible due to withdrawing his entire 401(k) and make the claimant appeal the decision and make the above arguments at a referee’s hearing.

Ultimately, I think the odds are that the law will ultimately settle on specifically permitting full benefits to be paid to someone who withdraws all funds from a 401(k) with a penalty while under the age of 59½. I think this is likely because it is consistent with the case law described above and it avoids having to formulate a policy to address a claimant’s own contributions to a 401(k) as distinct from an employer’s contribution. For the practitioner, I think it would be prudent to inform his client of the risks described above, and even if the chances of success are high, to be prepared to have to engage in the hearing process to arrive there.

James W. Cushing is an associate at the Law Office of Faye Riva Cohen and research attorney for Legal Research Inc. He is licensed to practice law in both Pennsylvania and New Jersey.

Get ‘Em Out By Friday: Landlord-Tenant Disputes

By James W. Cushing
Special to the Legal

Back in the early 1970s, when the band Genesis, a progressive/art-rock band at the time, still had musical credibility, they released one of their more theatrical songs called “Get ‘em Out by Friday” on their classic album Foxtrot. It is one of my favorite albums, and every time I hear the song, with many of the lyrics being dialogue between landlord and tenants, it quickly brings to mind my own landlord-tenant cases. In the song, despite the desperate pleas of the pathetic tenants to stay – even offering to pay double the rent – Peter Gabriel, playing the role of the landlord, bellows “Get ‘em out by Friday!”

Many of my tenant-clients are struck by what they think is an inherent injustice in landlord-tenant law in two ways. First, tenant-clients obviously view their possession of a rented space with a certain amount of ownership interest. Even if they don’t own their place, it is still their home. Further, they also believe that being a “good tenant” (i.e., remaining current on rent and taking care of the property) should be rewarded with a certain amount of loyalty to them from the landlord. Unfortunately for tenants, neither of these is the case. Landlords have no obligation to reward and/or have loyalty for and/or give allowances to tenants who are so-called “good tenants.” As long as the terms of the lease are met, a landlord can request a tenant to vacate at any time at his or her own discretion. Additionally, regardless of whether the tenant pays rent timely and consistently, if the lease is a month-to-month lease, the landlord can request the tenant to vacate the premises within 30 days at the landlord’s discretion, or even less if the lease so permits.

Second, there are times where a landlord can be terrible, whether that means he or she is slow to maintain the property, has license and inspections violations, or is generally nonresponsive. Unfortunately for tenants, however, if the outstanding maintenance (and/or other) issues are cleared up and/or not raised by the tenant in court, the landlord again can request the tenant to vacate the property at any time (presuming he or she is in compliance with the terms of the lease). Indeed, many tenants believe an eviction action against them is often a form of retaliation for, say, reporting the landlord to Philadelphia Licenses and Inspections. They may be right, but unfortunately, contrary to popular belief, a tenant of a less-than-good landlord does not acquire additional rights, defenses and/or some sort of immunity from eviction. As long as there is compliance with the lease and the law, a landlord can pursue the eviction of a tenant at any time even when the landlord’s performance has historically been rather poor.

When counseling tenant-clients, it is important to impress upon them that landlords can pursue them at any time – within the bounds of the lease – regardless of how good of a tenant they are and how poor of a landlord they have. It is important to advise tenants to always be prepared for a landlord to request them to vacate the premises. More importantly, it is important to advise tenants that while they may win the initial battles against landlords for various maintenance and/or licenses and inspections issues, as soon as they are resolved, they should be prepared for an eviction action against them that will likely be successful. So, despite being a good tenant or being subjected to a bad landlord, at some point a landlord can – and likely will – loudly and successfully bellow “get ‘em out by Friday!”

James W. Cushing is an associate at the Law Office of Faye Riva Cohen and research attorney for Legal Research Inc. He is licensed to practice law in both Pennsylvania and New Jersey.

 

 

Fresh Ink: Inside Today's Legal

Welcome to your Friday morning round-up of stories in today’s edition of The Legal Intelligencer. All of the links below will take you directly to today’s stories, or you can head straight over to The Legal’s homepage. (Some stories may require registration or a paid subscription.)

The top story this morning is the Third Circuit restating its prediction that the Restatement (Third) of Torts, not the Restatement (Second), will be adopted in Pennsylvania by the state Supreme Court. As reporter Amaris Elliott-Engel writes, some district courts have said the Restatement (Second) should apply because the high court has not affirmatively adopted the Restatement (Third).

Also above the fold on Page 1, reporter Ben Present writes that Jerry Sandusky filed post-sentence motions arguing the judge presiding over his trial denied him due process by failing to grant him several motions for a continuance before his June trial.

Below the fold on Page 1, reporter Gina Passarella writes that the state Supreme Court has ruled that the state’s Coroner’s Act does not give a county coroner the discretion to deny a request for immediate disclosure of someone’s manner of death.

In more Regional News on Page 3, a former Dechert associate’s retaliation claim has been allowed to proceed in a case alleging the firm’s “macho culture” caused his work troubles.

As always, our People in the News section is on Page 2, and the top stories from our sister publications across the country make up the Page 4 National News section.

In a Family Law column on Page 5, James W. Cushing writes that substantial evidence must be used to convince the court in child abuse cases based on a recent case that profoundly changed the burden of proof to have someone listed on the ChildLine and Abuse Registry as a perpetrator of child abuse.

In a Bankruptcy Update on Page 7, Eric Scherling writes that the Third Circuit has protected post-confirmation appeals in the case of In re Philadelphia Newspapers.

If you have questions or comments about any of today's stories, or our coverage as a whole, we invite you to email any of the reporters directly. We hope you'll enjoy today's Legal.

The Pros and Cons of a Cut-Rate Divorce

By James W. Cushing
Special to the Legal

I am sure you have seen billboard or newspaper advertisements that read something like “$250 Divorce!” or “Divorce Only $350!” Usually, the prices indicated are less than $500; indeed they are so low that they are less than the typical lawyer’s hourly rate for one hour of work, let alone a proper full retainer. How can these rates be so low for this sort of work? Clearly there has to be a catch.

Like most unbelievable deals, the cheap rates do come with a catch, but for some people it may be a risk worth taking. The key to one of these low-cost divorces is that they require filing in a distant Pennsylvania county, usually where neither party resides - Potter County, for example - and a guarantee that there will be no resistance from the opposing spouse or any sort of property division.

The reason for filing in places like Potter County is that the total court fees and costs for a divorce are $69. This is in contrast to the court fees and costs for a divorce, in Philadelphia, which currently are $316 for the complaint and $66 for the praecipe to transmit, plus other fees required for motions and/or seeking equitable distribution, etc. So, right off the bat, there is more than a $300 savings in court costs and fees alone. It should be noted that the opposing party must stipulate to the jurisdiction of a foreign county over the divorce or else the entire endeavor to file the divorce in that county is a non-starter.

The reason for restricting these divorces to matters where there is complete cooperation and no property division is because, perhaps obviously, fees begin to add up when the parties start bickering over various things or need to seek some sort of property division, whether by agreement or order of court. As soon as either one of the above begins to occur, the low rate is immediately untenable for the lawyer representing one of the parties. If the parties are completely cooperative without any sort of property division, litigating the divorce only involves preparing some form documents and filing them at the correct times and in the correct order. Obviously, litigating in this fashion will take very little time or effort on the attorney’s part, which justifies taking the case at such an extremely reduced rate.

So, from the client’s point of view, there is a risk or tradeoff. On one hand, filing in your local county is more expensive, but if something goes wrong you have the security of being able to litigate the issues conveniently and locally without having to withdraw your complaint and start afresh elsewhere. On the other hand, filing in a different county is very cheap and easy, but if something goes wrong, the cost to litigate in a very distant county likely becomes prohibitively expensive and extremely inconvenient. Either way, you will have to withdraw your complaint in the foreign county and file a new complaint in your own county, potentially wasting the time and money that was spent filing elsewhere.

Both of the above options are viable and legitimate; it just depends on whether the circumstances suggest one over the other. Ultimately, the decision of where and how to proceed lies with the client as long as he or she is fully aware of the pros and cons, and costs and benefits, of each of the options described above.

James W. Cushing is an associate at the Law Office of Faye Riva Cohen and research attorney for Legal Research Inc. He is licensed to practice law in both Pennsylvania and New Jersey.

The House Loses?

By James W. Cushing
Special to the Legal

 They say the house always wins at a casino; however, against all odds, one would wager that a recent case brought in Atlantic County, N.J., seems to be a victory for the gamblers instead.

Back in April, a group of gamblers playing baccarat at the Golden Nugget in Atlantic City were astute enough to notice that with each successive hand, the same pattern of cards were dealt. The pattern was so consistent that the gamblers won 41 consecutive hands for $1.5 million worth of winnings.

The casino suspected the gamblers of cheating and approached at least one of them by allegedly waking him in the middle of the night in his hotel room and interrogated him – allegedly dealing him some physical force – and deprived him of food, water and an English interpreter for eight hours.

As it turned out, the gamblers did not cheat. Instead, it was discovered that the casino purchased its cards from a company called Gemaco, which was statutorily obliged to pre-shuffle the cards. Unfortunately for the casino, Gemaco allegedly failed to pre-shuffle the cards, leading to deck after deck of unshuffled cards being used for hand after hand of baccarat.

The casino decided to roll the dice and sued the gamblers for the return of the winnings paid and withheld the winnings it still possessed, saying that gambling regulations require fair odds for both gambler and casino. Of course, the gamblers disagreed, arguing that the fact the casinos crapped out by not shuffling the cards is not their fault, nor does it change the nature of the odds of the game itself. In addition, the gamblers upped the ante and countersued on the basis of ethnic/racial discrimination.

Judge James Isman ultimately ruled in favor of the gamblers, ruling that he did not believe the card game was rigged and noting that the complete lack of evidence of any unlawful activity on the part of the gamblers trumped the casino’s arguments.

The Golden Nugget has threatened to appeal, but also apparently has hedged its bets and made a settlement offer to resolve the matter. Regardless, the Golden Nugget will be pursuing Gemaco for providing unshuffled cards.

James W. Cushing is an associate at the Law Office of Faye Riva Cohen and research attorney for Legal Research Inc. He is licensed to practice law in both Pennsylvania and New Jersey.