Friday, April 22, 2011
Gross &Romanick P.C. Handles Large Corporate Acquisition
Gross & Romanick, P.C. is proud to announce that its client has successfully closed on the purchase of the D.C. area’s premier moving company, “Two Guys and a Truck”. Our firm represented the purchaser from the initial stages of contract negotiation through the closing of the multi-million dollar transaction. This was a very complex acquisition involving the purchase of the assets of various entities, as well as the purchase of ownership interests in other entities. Gross & Romanick prepared the various agreements necessary to document the complex sale, and performed the closing in our Fairfax office. Part of the transaction involved the acquisition of a franchise operation and the issuance of a new “Two Guys and a Truck” franchise in Washington, D.C. Edward Gross and Christopher DeSimone, the Gross & Romanick attorneys handling the transaction, conducted substantial legal due diligence and were able to structure the deal to limit the purchaser’s liability exposure. In addition, Gross & Romanick negotiated a favorable lease extension with the landlord. Following the closing and the exchange of the keys to the business, both the Buyer and Seller were pleased with the handling of the transaction and were enthusiastic about their future endeavors.
Thursday, April 14, 2011
Business Owner and Landlord's Liability for Criminal Assaults: How Adequate is Your Security?
A sales clerk abducted from a Northern Virginia shopping mall obtained a $360,000 settlement from the owners and operators because a former mall employee sodomized her, attempted to rape her and threatened to kill her. Yet, a woman who was attacked in a parking lot after attending a dinner theatre had her favorable verdict reversed on appeal to the Virginia Supreme Court. What is the difference between these two cases? Apparently, the main distinction was that 170 crimes had occurred at the mall in the past four years, while the dinner theatre had only two prior isolated acts of violence.
Duty to Foresee Imminent Danger
In the dinner theatre case (Wright v. Webb) the Court held that an owner did not have a duty to foresee acts of criminal violence and that two acts are insufficient to "lead a reasonable person ... to conclude that there was an imminent danger of criminal assault which required the invitor to take action to protect Webb." The mall which settled for $360,000 had numerous acts of violence, but hired only had one security guard to monitor the mall's interior.
Changes in Premise Liability Article
The Webb case would have a very different result if the business was the type that either "attracts" or "provides a climate" for assaultive crimes. But, what this standard means is difficult to define. Thus, a 24 hour Hardee's located in a bad neighborhood and catering to a "club crowd", which possesses guns and drugs, was not sufficient to prove that the business established a "climate" for criminal activity. On the other hand a car wash was held liable for maintaining a nuisance because of the behavior of its patrons who used and sold narcotics, consumed alcohol, littered and played loud music. Thus, we can assume that a criminal act committed by a patron of the car wash might result in liability to the owner. Nevertheless, even if the premises is permeated with criminal behavior, maintaining adequate security may still overcome liability for criminal acts against patrons.
Inadequate Security
A 1992 study indicates the average jury verdict in an inadequate security case is $3.35 million, with an average out of court settlement of $545,800. In a recent Texas case a jury awarded $17 million to a residential tenant who was raped by an intruder who had broken into the management offices and stole the woman's unit key. The victim had requested a deadbolt lock from the inside but the management company refused because the lease prohibited measures that would make the unit inaccessible to the management company, a policy which violated state law. In addition, the keys were stolen the day before the actual crime and no preventative action was taken; thus, it was foreseeable that there was danger of an imminent crime.
If a case goes to trial, the plaintiff will hire an expert who will identify the reasonable and appropriate preventative security measures which should have been taken by the owner. This same type of expert should be hired by an owner before a crime occurs in order to establish a security plan. Follow the plan, because a deviation can be used against the owner. Indiscriminate notation of problems by security personnel must be avoided; another recent large settlement resulted from the mall's personnel categorizing some teenage assaults as sexually related, as well as overdocumentation and exaggeration of many petty problems which occurred at the mall. Furthermore, failure to warn tenants of crimes that have been committed on the property and false assurances about security measures are cited as reasons for lawsuits.
In a case involving imminent danger of criminal assault, the Virginia Supreme Court reversed a judge who threw out a premises liability case. The case involved a restaurant which was sued for permitting a patron who was threatening a customer to return to the restaurant after he was initially escorted outside. Because this patron later assaulted the same customer upon reentry, the Court found sufficient evidence that the restaurant might have had notice that the assailant was likely to commit an assault o n a customer.
Standard of Care
Violation of federal, state, county and other municipal statutes, ordinances and regulations can be used by a plaintiff to establish negligence per se. The Residential Landlord Tenant Act authorizes localities to require charley bars, secondary locks on sliding glass doors and special locks on windows. Many municipalities have passed lighting requirements for parking lots, parking garages, common areas and other specific places. Virginia Code Section 9-183, et.seq. establishes licensing requirements for security guards. Follow these requirements.
The American National Standard Institute (ANSI) and other industry standards can help determine the specifications that should be followed. A focus on actual practices of comparable entities assists in discovering a standard of care. By surveying competitors an owner knows where closed circuit television cameras are normally used or how fire escape access is limited.
Conclusion
Do a realistic assessment of the likelihood of a crime being committed against your tenant or customer. Based upon that assessment, structure and follow a security plan which may include more security guards and structural solutions. Finally, do not violate any building codes designed to promote safety!
***
The above is not meant to replace legal counsel. If you'd like to speak to one of Gross & Romanick's lawyers, please call 703-273-1400 or fill out our online information request form.
Duty to Foresee Imminent Danger
In the dinner theatre case (Wright v. Webb) the Court held that an owner did not have a duty to foresee acts of criminal violence and that two acts are insufficient to "lead a reasonable person ... to conclude that there was an imminent danger of criminal assault which required the invitor to take action to protect Webb." The mall which settled for $360,000 had numerous acts of violence, but hired only had one security guard to monitor the mall's interior.
Changes in Premise Liability Article
The Webb case would have a very different result if the business was the type that either "attracts" or "provides a climate" for assaultive crimes. But, what this standard means is difficult to define. Thus, a 24 hour Hardee's located in a bad neighborhood and catering to a "club crowd", which possesses guns and drugs, was not sufficient to prove that the business established a "climate" for criminal activity. On the other hand a car wash was held liable for maintaining a nuisance because of the behavior of its patrons who used and sold narcotics, consumed alcohol, littered and played loud music. Thus, we can assume that a criminal act committed by a patron of the car wash might result in liability to the owner. Nevertheless, even if the premises is permeated with criminal behavior, maintaining adequate security may still overcome liability for criminal acts against patrons.
Inadequate Security
A 1992 study indicates the average jury verdict in an inadequate security case is $3.35 million, with an average out of court settlement of $545,800. In a recent Texas case a jury awarded $17 million to a residential tenant who was raped by an intruder who had broken into the management offices and stole the woman's unit key. The victim had requested a deadbolt lock from the inside but the management company refused because the lease prohibited measures that would make the unit inaccessible to the management company, a policy which violated state law. In addition, the keys were stolen the day before the actual crime and no preventative action was taken; thus, it was foreseeable that there was danger of an imminent crime.
If a case goes to trial, the plaintiff will hire an expert who will identify the reasonable and appropriate preventative security measures which should have been taken by the owner. This same type of expert should be hired by an owner before a crime occurs in order to establish a security plan. Follow the plan, because a deviation can be used against the owner. Indiscriminate notation of problems by security personnel must be avoided; another recent large settlement resulted from the mall's personnel categorizing some teenage assaults as sexually related, as well as overdocumentation and exaggeration of many petty problems which occurred at the mall. Furthermore, failure to warn tenants of crimes that have been committed on the property and false assurances about security measures are cited as reasons for lawsuits.
In a case involving imminent danger of criminal assault, the Virginia Supreme Court reversed a judge who threw out a premises liability case. The case involved a restaurant which was sued for permitting a patron who was threatening a customer to return to the restaurant after he was initially escorted outside. Because this patron later assaulted the same customer upon reentry, the Court found sufficient evidence that the restaurant might have had notice that the assailant was likely to commit an assault o n a customer.
Standard of Care
Violation of federal, state, county and other municipal statutes, ordinances and regulations can be used by a plaintiff to establish negligence per se. The Residential Landlord Tenant Act authorizes localities to require charley bars, secondary locks on sliding glass doors and special locks on windows. Many municipalities have passed lighting requirements for parking lots, parking garages, common areas and other specific places. Virginia Code Section 9-183, et.seq. establishes licensing requirements for security guards. Follow these requirements.
The American National Standard Institute (ANSI) and other industry standards can help determine the specifications that should be followed. A focus on actual practices of comparable entities assists in discovering a standard of care. By surveying competitors an owner knows where closed circuit television cameras are normally used or how fire escape access is limited.
Conclusion
Do a realistic assessment of the likelihood of a crime being committed against your tenant or customer. Based upon that assessment, structure and follow a security plan which may include more security guards and structural solutions. Finally, do not violate any building codes designed to promote safety!
***
The above is not meant to replace legal counsel. If you'd like to speak to one of Gross & Romanick's lawyers, please call 703-273-1400 or fill out our online information request form.
Monday, March 21, 2011
Federal Privacy Policy
Does the Gramm-Leach-Bliley Act (The GLB ACT) affect the operations of your company?
The GLB Act seeks to protect disclosure of non-public personal information about individuals to non-affiliated third parties. Such information includes names, addresses, dates of birth, social security numbers, etc. If the GLB Act applies, your company is required to give notice of its privacy policy, by July 1, 2001, to customers who have provided individual non-public personal information. In addition, your company is required to annually provide notice of its privacy policy to these customers. The GLB Act is intended to apply to banks, thrifts, credit unions and other "Financial Institutions". The term "Financial Institutions" is very broadly defined under the act. The broad definition of "Financial Institutions" may result in the GLB Act applying to your business. "Financial Institutions" under the GLB Act include those companies that are deemed to be a "lender".
DOES THE GLB ACT APPLY TO YOUR BUSINESS?
Do you regularly obtain non-public personal information about individuals? Do you extend payment terms and charge an interest component? If the answer is yes, then it is quite possible that your company may be defined as a "lender" under the GLB Act. The GLB Act does not specify how often this has to occur before your company will be deemed a lender. If you do so on rare occasions, you are probably not a "lender" subject to the GLB Act. However, if it is a normal part of the business to extend payment terms and charge interest, you may be deemed a lending institution subject to the GLB Act. The GLB Act is unlikely to apply to a situation where the interest is only charged upon the event of a default of the payment terms. However, the closer an agreement looks to be a loan of any kind, the more likely it is that the GLB Act applies to the information obtained in the transaction.
WHAT SHOULD YOUR COMPANY DO?
Even if you do not disclose to third parties the nonpublic personal information you obtain from customers, the safest route is to establish a Privacy Policy and provide a copy of it to your customers by July 1, 2001 and annually thereafter. Whether you actually fall under the Act or not, you can establish a privacy policy, prepare a Federal Privacy Disclosure Form, and send a copy of it to all of your customers. You may be able to utilize it as a marketing tool. The privacy policy will need to advise your customers of their right to "Opt Out" of your disclosure of information to third parties. Please contact us if we can help you create and effectuate a proper Privacy Policy to comply with the GLB Act.
***
The above is not meant to replace legal counsel. To speak to one of Gross & Romanick's attorneys, call 703-273-1400 or fill out our online information request form.
The GLB Act seeks to protect disclosure of non-public personal information about individuals to non-affiliated third parties. Such information includes names, addresses, dates of birth, social security numbers, etc. If the GLB Act applies, your company is required to give notice of its privacy policy, by July 1, 2001, to customers who have provided individual non-public personal information. In addition, your company is required to annually provide notice of its privacy policy to these customers. The GLB Act is intended to apply to banks, thrifts, credit unions and other "Financial Institutions". The term "Financial Institutions" is very broadly defined under the act. The broad definition of "Financial Institutions" may result in the GLB Act applying to your business. "Financial Institutions" under the GLB Act include those companies that are deemed to be a "lender".
DOES THE GLB ACT APPLY TO YOUR BUSINESS?
Do you regularly obtain non-public personal information about individuals? Do you extend payment terms and charge an interest component? If the answer is yes, then it is quite possible that your company may be defined as a "lender" under the GLB Act. The GLB Act does not specify how often this has to occur before your company will be deemed a lender. If you do so on rare occasions, you are probably not a "lender" subject to the GLB Act. However, if it is a normal part of the business to extend payment terms and charge interest, you may be deemed a lending institution subject to the GLB Act. The GLB Act is unlikely to apply to a situation where the interest is only charged upon the event of a default of the payment terms. However, the closer an agreement looks to be a loan of any kind, the more likely it is that the GLB Act applies to the information obtained in the transaction.
WHAT SHOULD YOUR COMPANY DO?
Even if you do not disclose to third parties the nonpublic personal information you obtain from customers, the safest route is to establish a Privacy Policy and provide a copy of it to your customers by July 1, 2001 and annually thereafter. Whether you actually fall under the Act or not, you can establish a privacy policy, prepare a Federal Privacy Disclosure Form, and send a copy of it to all of your customers. You may be able to utilize it as a marketing tool. The privacy policy will need to advise your customers of their right to "Opt Out" of your disclosure of information to third parties. Please contact us if we can help you create and effectuate a proper Privacy Policy to comply with the GLB Act.
***
The above is not meant to replace legal counsel. To speak to one of Gross & Romanick's attorneys, call 703-273-1400 or fill out our online information request form.
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