jeff matura and amanda taylor assist with argument presented to the united states supreme court10/6/2018
Attorneys Jeff Matura and Amanda Taylor assisted with an argument presented to the United States Supreme Court regarding whether the Age Discrimination in Employment Act ("ADEA") applies to public employers that have less than 20 employees. The argument was presented to the United States Supreme Court on the first day of its Fall 2018 session.
The case involves a lawsuit that two former employees filed against the Mount Lemmon Fire District. The trial court dismissed the lawsuit after agreeing with Mr. Matura and Ms. Taylor's arguments that the ADEA does not apply because the Fire District had less than 20 employees. The Ninth Circuit reversed the trial court's decision and concluded that the 20-employee threshhold only applies to private employers, but not to public employers such as the Fire District. The Ninth Circuit's decision was contrary to the decision of every other Circuit Court that had analyzed the same issue. Mr. Matura and Ms. Taylor then filed a petition to the United States Supreme Court, which agreed to hear the issue and resolve the Circuit Court split that existed following the Ninth Circuit's decision. Mr. Matura and Ms. Taylor assisted with the arguments to the United States Supreme Court and requested that the Court conclude that the 20-employee threshhold within the ADEA applies to both public and private employers. The United States Supreme Court took the matter under advisement and is expected to issue a ruling within the next several months. For more information on this issue, please contact Mr. Matura or Ms. Taylor. Arizona Court of Appeals Rules “Hashish” Not Covered Under Arizona’s Medical Marijuana Act6/27/2018
The Arizona Court of Appeals, in their recent ruling in State v. Jones, No. 1 CA-CR 16-0703 has held that “hashish” is not covered as “marijuana” under the Arizona Medical Marijuana Act (“AMMA”). Hashish is a resin extracted from marijuana plant. The case arose from the criminal conviction of Rodney Jones in March 2013, when Jones was found in possession of a jar containing .05 ounces of hashish. Jones was a registered qualifying patient under the AMMA. Jones was indicted on one count each of possession of the drug cannabis and possession of drug paraphernalia- the jar containing the cannabis. Jones moved to dismiss the charges, arguing that his valid AMMA card provided an absolute defense. The Superior Court denied his motion, convicting Jones in September 2016 to 3.5 years’ imprisonment.
The AMMA defines marijuana as the “dried flowers of the marijuana plant, and any mixture or preparation thereof…” [1] (Emphasis added). Lawyers for Jones argued that hashish is a preparation of the marijuana plant, and thus allowed under the AMMA. The Court of Appeals disagreed and sided with the State, finding that hashish is not a “preparation” of the marijuana plant, but an extracted resin, and thus distinct from marijuana allowed under the AMMA. The Court cited to a 1978 case, State v. Floyd,[2] which notes the “great potency” of hashish, rendering it “susceptible to serious and extensive abuse.”[3] Judge Kenton Jones wrote a dissenting opinion, arguing that the AMMA’s definition of marijuana “clearly encompasses all forms of the marijuana plant, including its resin” and advocated for an interpretation that is consistent with the “spirit and purpose of the AMMA.” This case will no doubt have wide implications on the medical marijuana industry. It’s estimated that 40 percent of dispensary sales are made up of “concentrates” such as hashish and resins.[4] If you have questions regarding this recent ruling, contact Jeff Matura, Tabitha Myers, or Melissa England at 602-792-5705. Learn more about the Barrett | Matura Cannabis Law Practice Group. You can read the Court's Full Decision here. [1] A.R.S. Sec. 36-2801(15). [2] 120 Ariz. 358, 360 (App. 1978) [3] Id. [4]http://www.phoenixnewtimes.com/news/cannabis-extracts-arizona-dispensaries-illegal-appeals-court-rules-10558752 Hunton v. American Zurich Ins. Co. – Expert’s Testimony May Lead to Implied Waiver of Attorney-Client Privilege
The Arizona District Court recently found an implied waiver of the attorney-client privilege based on the testimony of the insurer’s own bad faith expert. In Hunton v. American Zurich Ins. Co., 2017 WL 3712445 (D. Ariz. 2017), the insured brought a bad faith suit against the carrier for the handling of her worker’s compensation claim. At issue was the failure of the carrier to accept the claim for several months even after it had obtained an IME report confirming the injury was the direct result of work activity. The carrier’s expert ultimately opined there was no bad faith on the part of the carrier. However, during his deposition, the expert testified that he did not know why the adjuster delayed and then ultimately accepted the claim and speculated that it was probably the result of “a series of emails” between her and her counsel. He further stated that he assumed she “still had doubts” after the IME report and suspected it was due to “a discussion she had with counsel the day she accepted it.” Those emails, of course, had been redacted, which led to a motion to compel their production. Although the carrier argued that it was not raising a defense of “subjective” reasonableness and, therefore, the adjuster’s state of mind was not relevant, the Court found that through the testimony of the carrier’s own expert, it had expressly put “the subjective beliefs of the claims adjuster directly at issue.” As a result, the carrier impliedly waived the attorney-client privilege with respect to any communications regarding the ultimate coverage determination and decision to accept the claim. The Court relied on the principle that if the adjuster incorporated the advice or judgment of its own coverage counsel in making its decision, it could not “shield” those communications. Carriers should be cautioned that if they do attempt to rely on any advice of counsel, a court may find an implied waiver of the privilege, even though that carrier does not expressly raise an “advice of counsel” defense. Therefore, the testimony of an adjuster is usually critical in this regard. If that testimony raises any issue with regard to the subjective beliefs of the adjuster or his or her reliance on communications from counsel, a court will likely find such a waiver. This case further confirms that a court may find such a waiver even if the testimony comes from the carrier’s expert instead of the adjuster. As a result, carriers and their counsel should ensure that their experts do not offer such testimony or speculate that certain actions or decisions may have been based on communications or advice from their counsel. Otherwise, they may inadvertently waive the attorney-client privilege with regard to any such communications. Learn more about the Barrett | Matura Insurance Litigation and Coverage Practice Group. Contact Jennifer Bahling or Kevin Barrett for more information. Chukly v. American Family – Insured Can Prevent Removal to Federal Court by Adding Individual Adjuster as a Defendant
Insurers routinely remove breach of contract and bad faith lawsuits to Federal Court, a forum typically thought of as more favorable. The Arizona District Court recently confirmed that an insured, by adding a separate claim against an individual adjuster (or other employee of the insurer) could defeat the diversity requirement, allowing the case to be sent back to state court. In Chukly v. American Family Ins. Co., 2017 WL 3262541 (D. Ariz. 2017), the insureds sued their homeowner’s insurer for bad faith arising out of a claim for storm damage to their home. They also added a claim against the individual adjuster and the claims manager for “aiding and abetting” the alleged bad faith handling of the claim. Because the individual employees were Arizona residents (as were the insureds), they moved to remand the case based on a lack of complete diversity. The Court noted that it did not have jurisdiction unless there was complete diversity among all parties, unless one of those parties was “fraudulently joined” simply to defeat the diversity requirement. Fraudulent joinder occurs if the claim “fails to state a cause of action” against a particular defendant and the failure is “obvious.” The Court pointed out that Arizona courts, both state and federal, have reached “diverging outcomes” in terms of the validity of an “aiding and abetting” claim against an individual claims adjuster or other such employee. Some have allowed such a claim. Some courts have found that there is no basis for such a claim unless that adjuster actually engaged in a “separate tortious act” of his own. As a result, the Court resolved this ambiguity in the law in favor of the insureds and remanded the case back to state court. This may not create a blanket rule, as each case will depend on the claims raised in that particular lawsuit and the merits of those claims. However, this ruling does potentially allow more insureds to defeat removal to Federal Court simply by adding this type of claim against individual adjusters and other employees if they are non-diverse. Of course, if those claims are ultimately dismissed, insurers may have the opportunity to remove the case back to Federal Court at that time. Learn more about the Barrett | Matura Insurance Litigation and Coverage Practice Group. Contact Jennifer Bahling or Kevin Barrett for more information.  Attorneys Jeff Matura and Amanda Taylor filed a petition to the United States Supreme Court to request that it enforce the language of the Age Discrimination in Employment Act (“ADEA”). Mr. Matura and Ms. Taylor represent an Arizona public entity. Two former employers filed a lawsuit against this public entity and allege that it wrongfully terminated them due to their age in violation of the ADEA. The federal trial court dismissed their lawsuit and agreed with Mr. Matura and Ms. Taylor that the ADEA does not apply because the public body has less than 20 employees. The Ninth Circuit Court of Appeals reversed the trial court’s decision and held that the 20-employee requirement does not apply to public entities. The Ninth Circuit’s decision is contrary to every other appellate court that has reviewed the issue. Mr. Matura and Ms. Taylor therefore petitioned the United States Supreme Court to request that it reverse the Ninth Circuit and apply the ADEA’s 20-employee requirement to all employers, including public entities. If you have questions about this petition, the ADEA, or other issues involving public entities, please contact Mr. Matura or Ms. Taylor. You can read the full petition here and below. 
Attorneys Jeff Matura, Melissa England and Tabitha Myers at Barrett & Matura, PC, in conjunction with attorney Sean Berberian at White Berberian, PC are asking the Arizona Court of Appeals to force state health officials with the Department of Health Services to reduce the amount charged to patients and caregivers who are required to obtain state-issued permits to buy their medicine.
The plaintiffs are two Arizona patients and a caregiver. They argue that the Arizona Medical Marijuana Act requires the State to charge fees only in an amount “sufficient to implement and administer” the state’s medical marijuana program. Instead, the state charges exorbitant fees that have resulted in a surplus of about $25 million. Will Humble, who was Arizona’s health director when the Arizona Medical Marijuana Act became law, has commented in the past that the fee he initially set was based upon a estimation that 25,000 individuals would apply for permits. In reality, more than 140,000 individuals have applied in Arizona. The result is that the state has collected fees far in excess than the amount necessary to implement and administer the program. The plaintiffs are therefore requesting the Court to order the state to reduce the amount of the fees and to return the surplus money to the patients and caregivers in Arizona. Learn more about the Barrett | Matura Cannabis Law Practice Group. On January 4, 2018, United States Attorney General Jeff Sessions reversed the government’s long-standing policy regarding the enforcement of federal drug laws in states that have passed laws to protect marijuana businesses and users. In 2013, the Obama Administration adopted a policy known as the Cole Memorandum, which directed federal prosecutors to use discretion in prioritizing and prosecuting violations related to marijuana in states that had passed laws to protect its sale and use for medical and recreational purposes. This policy indicated that the federal government would respect state marijuana laws if certain conditions were satisfied - such as keeping marijuana away from criminal gangs and out of the hands of children. Attorney General Jeff Sessions reversed this policy and stated that each United States Attorney in each individual state should decide whether they will prosecute businesses and individuals who buy, sell, or use marijuana pursuant to state law. The result is that the government’s view on state marijuana laws could vary from state-to-state. It also means that businesses and users who comply with state marijuana laws are no longer shielded from prosecution by the federal government because marijuana remains illegal under federal law and is classified as a Schedule I drug by the federal Controlled Substances Act.
Despite the new direction from Attorney General Jeff Sessions, some limited protections do still exist, including under the Rohrabacher-Blumenauer Amendment, which limits the government’s use of certain funds to prosecute individuals who are complying with state marijuana laws. If you have questions about compliance with state and federal marijuana laws, call Jeff Matura, Melissa England, or Tabitha Myers at 602-792-5705. Learn more about the Barrett | Matura Cannabis Law Practice Group.  Kevin Barrett and Jeff Matura announced the opening of their new law firm, Barrett | Matura. Joining Kevin Barrett and Jeff Matura are attorneys Jennifer Bahling, Melissa England, Amanda Taylor, and Tabitha Myers. Barrett | Matura is a full-service law firm that represents clients in Arizona, Nevada, and California in a broad range of legal areas, including business disputes, insurance coverage and bad faith litigation, municipal and governmental issues, medical and recreational cannabis law, employment disputes, and real estate transactions.
Double AA Builders v. Preferred Contractors Ins. Co. – “Subcontractor Exception” Does Not Create More Coverage for Additional Insured
The Arizona Court of Appeals recently confirmed that the “subcontractor exception” of the “your work” exclusion cannot create coverage for an additional insured, particularly when the same provision would bar coverage for the named insured. The “your work” exclusion, standard in a commercial general liability policy, typically bars coverage when the only damage is to the insured’s own “work.” Courts have uniformly recognized that this type of policy is not meant to act as a warranty of the insured’s own work. This exclusion typically includes an exception, however, if the damage arises out of work “performed on your behalf by a subcontractor.” In Double AA Builders v. Preferred Contractors Ins. Co., 241 Ariz. 304, 386 P.2d 1277 (Ariz. App. 2016), the Arizona Court of Appeals addressed, for the first time, whether this exception could create coverage when an additional insured, as opposed to a named insured, is seeking coverage. Double AA Builders was the general contractor for the construction of a Harkins Theatre. It hired Anchor Roofing to install the roof. After the roof leaked and caused damage to the theater, Double AA replaced it and sought indemnity from Anchor as well as its insurer, Preferred Contractors (whose policy named it as an additional insured). Notably, Double AA sought to recover only the cost of replacing the roof. The trial court found that there was an “occurrence” that had resulted in “property damage” during the policy period and that the “subcontractor exception” negated the “your work” exclusion since the work was performed by Double AA’s sub, Anchor Roofing. On appeal, however, the Court held the exception did not apply. Simply put, the “your work” exclusion applies to work performed by the named insured. “You” and “your” are defined to include the named insured and anyone qualifying as a named insured under the policy. Anchor Roofing, the named insured, performed the work. All damage was to the named insured’s work. The subcontractor exception, explained the Court, would only apply if Anchor had used subs to perform this work. Double AA Builders was simply an additional insured. It could not argue that this exception applied because the work was performed by one of its subs. Otherwise, explained the Court, the additional insured would be able to “take advantage of” the subcontractor exception and obtain greater coverage than would be available for the named insured, and interpretation that would “neither be rational nor consistent with the express language of the policy”. This is particularly true since coverage for an additional insured, by nature, is intended to be more limited than that of a named insured and, in many cases, is provided with little or no additional premium. Notably, in Double AA Builders, the additional insured sought coverage only for the cost of replacing the roof itself. In other words, the “your work” exclusion applied in the first place because all damage sought was to the named insured’s own work. This holding does not necessarily impact coverage in other situations, where the work has caused damage to other property and claims are made for that other damage. Further, although the leaking roof had apparently caused additional damage, no claim was made for that additional damage. The trial court still had found an “occurrence” causing “property damage” before addressing the applicability of the exclusion and its exception. Because the Court of Appeals found the “your work” exclusion clearly applied, and the exception did not apply, it did not further address whether the trial court had correctly found an “occurrence” in the first place. Because this case was limited to a situation involving the replacement of faulty work only, it may not have a broad impact on coverage in general. It merely reinforces the general rule that liability policies do not cover the repair of faulty work. However, the Court of Appeals’ decision does confirm the notion that an additional insured is not entitled to any greater coverage under a policy than a named insured, a notion advanced by most insurers although perhaps never expressly articulated by the Courts. This general principle may ultimately assist carriers in making similar arguments in other types of situations involving additional insureds and the scope of coverage available under a general liability policy. Learn more about the Barrett | Matura Insurance Litigation and Coverage Practice Group. Contact Jennifer Bahling or Kevin Barrett for more information.  Jeffrey Matura spoke at the Southwest Cannabis Conference & Expo held in Phoenix, Arizona. Mr. Matura discussed legal issues and trends facing individuals and businesses involved in the legal cannabis industry. Mr. Matura also provided advice regarding best practices to ensure compliance with all state laws and regulations. The Southwest Cannabis Conference & Expo markets itself as the premier conference in which individuals can obtain education on medical and recreational cannabis issues.
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