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Businesswoman looking pensive while reading contract

Danielle Ward has concentrated her law practice on defending developer, general contractor, and subcontractor clients in a variety of construction matters.

Update: Lawyers Can Be Bound to Confidentiality Provision in Settlement Agreement

Monday, January 13, 2020 — Danielle Ward, Esq. - Balestreri Potocki & Holmes

In July 2019, the California Supreme Court ruled that an attorney’s signature under the often-used phrase “approved as to form and content” does not preclude a finding that the attorney could be bound to the terms of a settlement agreement. (Monster Energy Co. v. Schechter (2019) 7 Cal.5th 781.) This decision marks a reversal of the Fourth District Court of Appeal’s 2018 ruling that approval of a contract is not tantamount to an agreement to be bound by that contract.

The underlying action stemmed out of a wrongful death suit by Wendy Crossland and Richard Fournier, parents of the decedent, against Monster Energy Company. The parties negotiated a settlement, a critical of element of which was a confidentiality provision aimed at keeping the the settlement secret.

The confidentiality provision prohibited plaintiffs and their counsel of record from disclosing both the existence of the settlement, or the terms thereof, to any person, entity, or publication, including the legal website Lawyers & Settlements. The attorneys signed the agreement under the phrase “approved as to form and content.”

Shortly after the settlement agreement was executed, the Plaintiffs’ attorney Bruce Schechter disclosed his clients’ settlement with Monster in an interview with Lawyers & Settlements. Monster filed suit against Mr. Schechter for breach of contract, among other causes of action. Mr. Schechter challenged the lawsuit with a SLAPP motion, essentially arguing that the lawsuit was meritless and merely an attempt to thwart freedom of speech.

The trial court denied Mr. Schechter’s motion as to the breach of contract cause of action finding that the settlement clearly contemplated that the attorneys were subjected to the terms of the agreement, and Schechter’s claim that he was not a party because he merely approved as to form and content was “beyond reason.”

The Fourth District Court of Appeal reversed, concluding that Mr. Schechter was not a party to the agreement by virtue of his signature approving the form and content, and the Plaintiffs had no authority to bind their attorney to the terms of the agreement. The Court of Appeal found that by affixing his signature to the agreement Mr. Schechter was merely manifesting his “professional thumbs up” in line with legal industry’s customary understanding.

In its reversal, the California Supreme Court did not disturb the legal community’s understanding of the phrase “approved as to form and content.” Rather, the Court concluded that an attorney’s signature under that often-used phrase does not preclude as a matter of law that the attorney intended to be bound by the agreement. The entire agreement, including the substantive provisions, need to be examined to determine the attorney’s intent in affixing his/her signature to the agreement.

Turning to the Crossland/Fournier Monster settlement agreement, the Court was unpersuaded by Mr. Schechter’s argument that he was not bound to the agreement because counsel was not included in the definition of “party”. The Court stated that it’s the substance of the agreement that determines whether counsel is a party to the contract, as opposed to a party to the lawsuit.

The Court was persuaded, in part, by the important role that confidentiality plays in brokering settlements. It noted that public disclosure of private settlements would serve to “chill” parties’ ability to resolve matters short of trial, and there was little doubt that confidentiality was an important term of the Crossland/Fournier Monster settlement. In concluding that Monster had met its burden to defeat an anti-SLAPP motion, the Court pointed to the numerous references to counsel in the substantive provisions of the agreement which a trier of fact could conclude bound Mr. Schechter to the confidentiality terms.

Danielle Ward has concentrated her law practice on defending developer, general contractor, and subcontractor clients in a variety of construction matters. She has been an attorney with Balestreri Potocki & Holmes since 2010 and can be reached at dward@bph-law.com.



Gavel

Tred R. Eyerly discusses two collapse cases.

Connecticut Supreme Court Further Refines Meaning of "Collapse"

Monday, January 13, 2020 — Tred R. Eyerly - Insurance Law Hawaii

Connecticut courts have been inundated with collapse cases the past couple of years due to insureds' living in homes that were constructed with defective concrete manufactured by J.J. Mottes Concrete Company. In a duo of cases, the Connecticut Supreme Court responded to a certified question from the U.S. District Court, holding that collapse required that the building be in imminent danger of falling down. Vera v. Liberty Mut. Fire Ins. Co., 2019 Conn. LEXIS 339 (Conn. Nov. 12, 2019).

Plaintiffs had resided in their home since 2009. The home was built in 1993. In August 2015, after learning about the problem of crumbling basement walls affecting homes in their community due to cement manufactured by Mottes, they retained a structural engineer to evaluate their basement walls. The engineer found spider web cracking approximately 1/16 of an inch wide in the basement walls and three small vertical cracks. There were no visible signs of bowing. The engineer did not find that the walls were in imminent danger of falling down, but recommended that the basement walls be replaced.

Plaintiffs submitted a claim under their homeowners policy to Liberty Mutual. The claim was denied. The policy did not define collapse, but stated that collapse did not include "settling, cracking, shrinking, bulging or expansion."

Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert

Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Ducklings on grass

Attorney Rahul Gogineni discusses Barrett v. Berry Contr. L.P.

“Wait! Do You Have All Your Ducks in a Row?” Filing of a Certificate of Merit in Conjunction With a Complaint

Monday, January 13, 2020 — Rahul Gogineni - The Subrogation Strategist

In Barrett v. Berry Contr. L.P., No. 13-18-00498-CV, 2019 Tex. LEXIS 8811, the Thirteenth District Court of Appeals of Texas considered, among other things, the procedural timing requirements of filing a certificate of merit in conjunction with a complaint. The court concluded that the proper reading of the statute requires a plaintiff to file a certificate of merit with the first complaint naming the defendant as a party.

In Barrett, after sustaining injuries while working at a refinery, David Barrett (Barrett) filed suit against Berry Contracting, LP and Elite Piping & Civil, Ltd. on July 6, 2016. In Barrett’s first amended complaint, which he filed on August 23, 2016, Barrett added Govind Development, LLC (Govind) as another defendant. Barrett subsequently filed a second amended complaint (omitting Govind) and, on December 27, 2017, shortly before the statute of limitations ran, a third amended complaint (reasserting claims against Govind). On January 28, 2018, after the statute of limitations period ran, Barrett filed a certificate of merit. Govind filed a motion to dismiss the claim, asserting that Barrett violated the statute that required a certificate of merit to be filed with the complaint, Tex. Civ. Prac & Rem. Code §150.002.

Tex. Civ. Prac. & Rem. Code §150.002(a) states,
In any action or arbitration proceeding for damages arising out of the provision of professional services by a licensed or registered professional, a claimant shall be required to file with the complaint an affidavit of a third-party licensed architect, licensed professional engineer, registered landscape architect or registered professional land surveyor…

Reprinted courtesy of Rahul Gogineni, White and Williams LLP

Mr. Gogineni may be contacted at goginenir@whiteandwilliams.com

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CEMEX Ventures Invests in X3 Builders, a Vertically Integrated General Contractor

January 13, 2020 — Aarni Heiskanen - AEC Business

CEMEX Ventures has announced its investment in X3 Builders. X3 Builders is a vertically integrated general contractor that combines architectural design, material procurement, and construction services to provide clients with a one-stop solution and a seamless transition from design to construction.

This California-based startup is a completely new type of general contractor due to its 100% technological approach. It provides real-time pricing during the design process to reduce cost uncertainty and wasteful redesign efforts. It also standardizes material selection and works directly with suppliers to procure materials, eliminating submittals and lead-time delays. Their in-house software helps to manage the process end-to-end, simplifying the complexities of construction and automating most of the construction administration and accounting process.

Mr. Heiskanen may be contacted at aec-business@aepartners.fi

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Pro Se Plaintiff's Motion to Dismiss Federal Claim against Carrier Without Prejudice Denied

January 13, 2020 — Tred R. Eyerly - Insurance Law Hawaii

The Hawaii federal district court denied the pro se plaintiff's motion to dismiss his claim against the carrier without prejudice. Greenspon v. AIG Specialty Ins. Co., et al., 2019 U.S. Dist. LEXIS 144148 (D. Haw. Aug. 23, 2019).

Greenspon secured a default judgment against AIG's insured in state court in 2014. In November 2018, AIG removed the case to federal district court. Greenspon filed a motion to remand. On February 25, 2019, the court denied Greenspon's motion for remand because Greenspon had not asserted a claim against the sole in-state party, a law firm, rendering the law firm's presence as a defendant improper and resulting in its exclusion when determining diversity.

Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Homebuilder Stocks Rally After Lennar Results Top Estimates

January 13, 2020 — Felice Maranz – Bloomberg

Builders rose after Lennar Corp.’s fourth-quarter orders and revenue beat estimates, even as home prices fell in the quarter.

Lennar shares jumped as much as 5.4% in early Wednesday trading, the most since March 27. The S&P Supercomposite Homebuilding Index rose as much as 2.9% to the highest since Dec. 12, with top gainers including M/I Homes Inc., which got an upgrade earlier, William Lyon Homes, Century Communities Inc. and Toll Brothers Inc.

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NAHB IBS 2020

January 13, 2020 — Beverley BevenFlorez – CDJ Staff

Next week, the National Association of Home Builders (NAHB) presents their annual International Builders’ Show (IBS) in Las Vegas, Nevada. With 600,000 square feet of space, 1,400+ exhibitors, 67,000+ attendees from 100+ countries, 2 show homes, and 150+ educational sessions, the IBS 2020 will have something for everyone in the home building industry.

January 21st-23rd, 2020
Las Vegas Convention Center
3150 Paradise Road
Las Vegas, NV 89109

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Contract in typewriter

Why is a construction attorney learning about lean?

Get Your Contracts Lean- Its Better than Dieting

Monday, January 13, 2020 — Brian Perlberg, Esq. - ConsensusDocs

I recently took the AGC Lean Construction Educations Program Units 1-7. After studying diligently, I’m happy to say that I passed the exam and earned my CM-Lean credential. Surprisingly, this makes me the first attorney to earn this distinction out of over 1,200 CM-Lean holders. So why is a construction attorney learning about lean? After all, this was my first exam in 20 years since I took the bar.

Well, according to McKinsey Global Institute, construction actually became less productive from 1995 through 2009. When it comes to efficiency, construction still lags significantly behind the manufacturing sector and the overall economy. Construction contracts – what we sign and the way in which we negotiate them, or lack thereof – is a principal reason why construction productivity is stagnant.

Contracting under an integrated lean project delivery method (ILPD) and incorporating Lean construction tools is the most powerful means to increase efficiency and add-value to owners. Owners are the client’s end-users of construction projects. ConsensusDocs has taken a leadership role in publishing the first standard ILPD contract which is an integrated form of agreement (IFOA). The ConsensusDocs 300 Integrated Project Delivery (IPD™) provides an off-the-shelf solution to contract utilizing lean tools. Not every owner can or is comfortable using an IPD approach. Consequently, ConsensusDocs produced the ConsensusDocs 305 Construction Lean Construction Addendum last year to provide an option for contracting for lean on Construction Management at-Risk and design-build projects. Some people call this approach IPD-lite or IPD’ish. Some disfavor such terms, because those terms have been used loosely on projects that aren’t very Lean.

Reprinted courtesy of Brian Perlberg, Esq., Executive Director and Senior Counsel of ConsensusDocs

ConsensusDocs may be contacted at support@consensusdocs.org

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Rain hitting home

Attorney David Adelstein analyzes Meridian Engineering Co. v. U.S.

Delays Caused When Government (Owner) Pushes Contractor’s Work Into Rainy / Adverse Weather Season

Monday, January 13, 2020 — David Adelstein - Florida Construction Legal Updates

There are a number of horizontal construction projects where a contractor’s sequence of work and schedule is predicated on avoiding the rainy season (or certain force majeure events). The reason is that the rainy season will result in delays due to the inability to work (and work efficiently) during the adverse weather (including flooding caused by the weather). If the work is pushed into the rainy season, is such delay compensable if the government (or owner) delayed the project that pushed work out into the rainy season? It very well can be.

For example, in Meridian Engineering Co. v. U.S., 2019 WL 4594233 (Fed. Cl. 2019), a contractor was hired by the Army Corps of Engineers to construct a flood control project for a channel in Arizona. Due to delays, including those caused by the government, the project was pushed into the monsoon season, which caused additional delays largely due to flooding caused by the heavy rain. One issue was whether such delays were compensable to the contractor – the government raised the argument that the contractor assumed the risk of potential flooding from the rainy season. The Court found this argument unconvincing:

[The contractor’s] initial construction schedule planned for a completion of the channel invert work, a necessary step in protecting the site from flooding, to be completed by late June 2008…[M]any issues arose in the project’s early stages that led to cumulative substantial delay, including those caused by the government’s failure….The government cannot now claim that [the contractor] assumed the risk of flooding from monsoon season when the government was largely responsible for [the contractor’s] inability to complete the project prior to the beginning of the monsoon season. Simply put, the government cannot escape liability for flood damages when the government is responsible for causing the contractor to be working during the flood-prone season.
Meridian Engineering, 2019 WL at *7 (internal citations omitted)

Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.

Mr. Adelstein may be contacted at dma@kirwinnorris.com

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Conference room

Attorney John Van Vlear has been elected to the Board of Directors for the GRA.

Newmeyer Dillion Announces Partner John Van Vlear Named to Board Of Groundwater Resources Association Of California

Monday, January 13, 2020 — Newmeyer Dillion

Prominent Orange County-based law firm Newmeyer Dillion is pleased to announce that partner John Van Vlear has been elected to the Board of Directors for the Groundwater Resources Association of California (GRA). He will serve a three year term effective immediately.

"It was an honor to be nominated and I'm excited to help further GRA's goal of remaining the preeminent professional organization in the West addressing timely and important groundwater issues," says Van Vlear. He has been a member of the GRA for five years and has spoken both at a Southern California branch event and the 2nd Annual Western Groundwater Congress in Sacramento. Serving on the GRA Board will be Van Vlear's fourth different lifetime non-profit Board volunteer effort. He joins a diverse group of members to complete the Board, including a hydrologist with the US Geological Survey, environmental and engineering consultants, an equipment manufacturer, and water agencies' managers.

Van Vlear's practice focuses on all aspects of "contaminated sites" environmental legal work. Applying technical acumen, he focuses on investigation, strategic analysis, and remediation for site acquisitions/sales, development, regulatory interface, and related litigation in federal and state courts. He represents clients before a wide range of environmental agencies and has a portfolio of projects that include: commercial, industrial, raw land, and residential, as well as specialty facilities such as affordable housing, oil fields, and landfills throughout California and across the country. These matters have involved a complex blend of soil, groundwater, and vapor contamination. Van Vlear is a frequent speaker on environmental, real estate and contamination topics, as well as being a professional author and novelist, an expert witness, and arbitrator on environmental issues. He has been interviewed on TV twice professionally and has testified before the California Senate subcommittee on Environmental Quality.

Established in 1992, the GRA is a 1,000 member state-wide professional organization dedicated to resource management that protects and improves groundwater supply and quality through education and technical leadership. The GRA hosts programs and webinars focusing on important issues to water management community at both the state-wide and regional branch levels.

About Newmeyer Dillion
For 35 years, Newmeyer Dillion has delivered creative and outstanding legal solutions and trial results that achieve client objectives in diverse industries. With over 70 attorneys working as a cohesive team to represent clients in all aspects of business, employment, real estate, environmental/land use, privacy & data security and insurance law, Newmeyer Dillion delivers holistic and integrated legal services tailored to propel each client's success and bottom line. Headquartered in Newport Beach, California, with offices in Walnut Creek, California and Las Vegas, Nevada, Newmeyer Dillion attorneys are recognized by The Best Lawyers in America©, and Super Lawyers as top tier and some of the best lawyers in California and Nevada, and have been given Martindale-Hubbell Peer Review's AV Preeminent® highest rating. For additional information, call 949.854.7000 or visit www.newmeyerdillion.com.



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Coral reef

The 2015 rule was very controversial.

EPA and the Corps of Engineers Repeal the 2015 “Waters of the United States” Rule

Monday, January 13, 2020 — Anthony B. Cavender - Gravel2Gavel

The pre-publication version of the final rule to be promulgated by EPA and the U.S. Army Corps of Engineers (ACOE) to repeal the 2015 redefinition of the Clean Water Act’s term “Waters of the United States” which is the linchpin of these agencies’ regulatory power under the CWA, was made available on September 12, 2019. The rule should be published in the Federal Register in the next few weeks, and it will be effective 60 days thereafter. Many challenges are expected to be filed in the federal courts.

The 2015 rule was very controversial, and petitions challenging the rule were filed in many federal district courts, several courts of appeal, and finally in the Supreme Court (see NAM v. Department of Defense), which held that all initial challenges must be filed in the federal district courts. The upshot of these challenges is that, at this time, the 2015 rule has been enjoined in more than half the states while the other states are bound by the 2015 rule, a situation which is frustrating for everyone.

In addition to repealing the 2015 rule, the agencies also restored the pre-2015 definition had had been in place since 1986. As a result, the pre-2015 definition of waters of the U.S. will again govern the application of the following rules: (a) the ACOE’s definition of “waters of the U.S.” at 33 CFR Section 328.3; (b) EPA’s general Oil Discharge rule at 40 CFR Section 110; (c) the SPCC rules at 40 CFR Part 112; (d) EPA’s designation of hazardous substances at 40 CFR Part 116; (e) EPA’s hazardous substance reportable quantity rule at 40 CFR Part 117; (f) the NPDES permitting rules at 40 CFR Part 122; (g) the guidelines for dredged or fill disposal sites at 40 CFR Part 230; (g) Exempt activities not requiring a CWA 404 permit (guidelines for 404 disposal sites at 40 CFR Part 232); (h) the National Contingency Plan rules at 40 CFR Part 300; (i) the designation of reportable quantities of hazardous substances at 40 CFR Part 302; and (j) EPA’s Effluent Guidelines standards at 40 CFR Part 401.

Reprinted courtesy of Anthony B. Cavender, Pillsbury

Mr. Cavender may be contacted at anthony.cavender@pillsburylaw.com

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Woman touching her temples

Please raise your hand if your clients — corporate clients — are angry about the burdens of litigation.

Breaking the Impasse by Understanding Blame

Monday, January 13, 2020 — Christopher G. Hill - Construction Law Musings

For this week’s Guest Post Friday (on a Thursday) here at Construction Law Musings, Victoria Pynchon (@vickiepynchon) joins us for the 4th time. Victoria is an attorney-mediator with ADR Services, Inc. in Century City; an arbitrator with the American Arbitration Association in Los Angeles, California; and, a negotiation consultant and trainer world-wide. Victoria co-founded She Negotiates Training and Consulting in 2010 and writes for ForbesWoman at its She Negotiates blog. She is the author of one of my favorite books on conflict resolution, A is for A*@!#, the Grownups’ ABC’s of Conflict Resolution reviewed at Musings here.

First Let’s Talk About Anger
Please raise your hand if your clients — corporate clients — are angry about the burdens of litigation. Irritated with the document “demands” and interrogatories. Frustrated about the e-discovery. Ticked off at the way opposing counsel asks them questions as if they’re lying. Hot under the collar about the mounting attorneys’ fees and the distance between the day suit was filed and the probable day on which a trial might eventually be scheduled. Simmering about the time the litigation consumes, time they’d prefer to be spending doing their actual jobs — planning for and implementing business strategies for a profitable future instead of fighting about the unprofitable past.

And we’re not even talking about your clients’ anger at the defendant who has stolen their intellectual property or stopped worked at the construction site or refused to release the remaining funds in the construction loan account. And if you believe that powerful people in highly successful and profitable businesses do not fear that litigation might hurt their careers, think again.

Reprinted courtesy of The Law Office of Christopher G. Hill

Mr. Hill may be contacted at chrisghill@constructionlawva.com

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Steel plate

The bridge's reconstruction is anything but a straightforward operation.

Steel Makeover Under Way for Brooklyn's Squibb Footbridge

Monday, January 13, 2020 — Tom Stabile - Engineering News-Record

Brooklyn Bridge Park’s Squibb Bridge has 127 fewer years of existence than the borough’s iconic East River span, but the pedestrian crossing got lots of New York City attention since it was first opened in 2013 after being shut down twice—once for excessive “bounciness” and again due to rotting wood. Now its reconstruction, hopefully for good, is anything but a straightforward operation.

Tom Stabile, Engineering News-Record

ENR may be contacted at ENR.com@bnpmedia.com

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Inside NYC's Skinniest Supertall Skyscraper | 3D VR180

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Disaster Goes Down on Burnt Paper

A shocking number of companies in the construction industry have neither a cyber insurance policy nor a basic cyber security plan.

Failing to Adopt a Comprehensive Cyber Plan Can Lead to Disaster

Monday, January 13, 2020 — Richard Volack - Construction Executive

Despite being aware of cyber risk, and even frightened by it, a shocking number of companies in the construction industry have neither a cyber insurance policy nor a basic cyber security plan to deal with a hack or breach into their computer systems. Once breached, companies with no plan in place become, essentially, a rudderless ship subject to the whims of criminal tides.

A proper cyber plan lays out at least the following:

  • the criteria for when a plan would be triggered (i.e., in the event of a breach or a hack);
  • which persons inside the company (in-house counsel, IT personnel, executive, project managers) and which persons outside the company (attorney with knowledge of cyber issues and ideally construction law as well; forensic computer experts, crisis management experts; and an insurance broker familiar with cyber policies) should be involved;
  • the chain of command and communication in this type of situation and the distinct roles each of the above players will fulfill (Note: this is not the same as the normal corporate chain of command); and
  • the various available options to address the breach situation, which will all depend upon the facts at issue—such as the type and extent of the breach and how much of what particular kind of information was lost, stolen or exfiltrated.

Reprinted courtesy of Richard Volack, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.

Mr. Volack may be contacted at rvolack@pecklaw.com



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Illustration of businessman sinking with liferaft

The House voted to approve the NAFTA replacement by a 385 to 41 vote.

Will The New U.S.-Mexico-Canada Trade Deal Calm Industry Jitters?

Monday, January 13, 2020 — Bruce Buckley - Engineering News-Record

News that House Democrats and the Trump administration have come to an agreement on the United States-Mexico-Canada Agreement (USMCA) provided a bit of calm in the storm over trade policies that have roiled the construction market since 2017.

Bruce Buckley, Engineering News-Record

ENR may be contacted at ENR.com@bnpmedia.com

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Word congratulations on ripped paper

Congratulations to attorney Tred R. Eyerly for 12 years of blogging.

On to Year Thirteen for Blog

Monday, January 13, 2020 — Tred R. Eyerly - Insurance Law Hawaii

Insurance Law Hawaii hits twelve years of existence this week, 1347 posts later. We started in December 2007. We continue in order to keep up on developing issues in insurance law. We strive to keep readers abreast of new developments in cases from Hawaii and across the country.

Other Damon Key blogs to check out are inversecomdemnation.com [here] authored by Robert Thomas, Mark Murakami's oceanlawhawaii.com [here] and hawaiiconstructionlaw.com [here] by Anna Oshiro.

Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert

Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Business people shaking hands

MTL serves as a resource for minority litigators, in-house counsel and law students, aiming to foster professional development, legal scholarship, advocacy and community involvement.

Hunton Insurance Partner Syed Ahmad Serves as Chair of the ABA Minority Trial Lawyer Committee’s Programming Subcommittee

Monday, January 13, 2020 — Michelle M. Spatz - Hunton Insurance Recovery Blog

Syed Ahmad, a partner in Hunton Andrews Kurth’s Insurance Coverage practice, has volunteered to serve as Chair of the ABA Minority Trial Lawyer Committee’s Programming Subcommittee. The Minority Trial Lawyer Committee (MTL) serves as a resource for minority litigators, in-house counsel and law students, aiming to foster professional development, legal scholarship, advocacy and community involvement. As Chair of the Programming Subcommittee, Syed, who was named to Benchmark Litigation’s 40 & Under Hot List earlier this year, will help advance MTL’s mission of facilitating discussions about diversity and the law and providing career network opportunities for minority trial lawyers.

Reprinted courtesy of Michelle M. Spatz, Hunton Andrews Kurth

Ms. Spatz may be contacted at mspatz@HuntonAK.com

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Builders Standard of Care Expert Witness and Consulting General Contractor area area area

Builders Standard of Care Expert Witness and Consulting General Contractor area area area

Builders Standard of Care Expert Witness and Consulting General Contractor area area area

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