Pennsylvania Law Monitor : Pennsylvania Lawyer & Attorney : Stark & Stark Law Firm : Yardley, Philadelphia, New York, New Jersey

Henry E. Van Blunk, Shareholder in Stark & Stark’s Business & Corporate group, will present a seminar entitled, Understanding Deal Structure: Legal Agreements and Due Diligence at the 2009 Schwab Transition Planning Workshop. The Workshop will take place July 9-10, 2009 in Boston, Massachusetts. 

Mr. Van Blunk’s presentation will include a discussion on the key points of structuring a deal, as well as a discussion on the process, time frames and negotiating strategies for both internal and external ownership transitions. Mr. Van Blunk will also focus on the contracts, due diligence and documents associated with these transitions.

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While much of the tabloid debate surrounding when Jon and Kate separated seems focused on whether or not they were faking their relationship the past couple seasons and scamming their viewers; the legal reality is that the date of final separation plays a crucial role in the divorce.

The significance of the date of final separation lies in determining the “marital property”; or the portion of the parties assets that the Court has the power to divide between the parties.

In Pennsylvania, “marital property” means all property acquired by either party during the marriage as well as the increase in value of most nonmarital property during the marriage.  However, marital property does NOT include property acquired after final separation.

This could be significant in this case.  The Gosselins have already released at least two books and Kate has a third book scheduled to be released this fall, not to mention the lucrative speaking engagements the parties participate in.  Any income received from any of the book deals (or speaking engagements) after the date of final separation will not be considered marital property and will belong exclusively to the party who earned the income.

The high profile of Jon and Kate provides the public with a unique opportunity to explore issues that arise in contested divorce cases. Through this ongoing series I will offer comments and analysis of the proceedings and provide insight on how developments in Jon and Kate's case may occur in other divorces.  I am a Pennsylvania divorce attorney who is not involved in the Jon and Kate matter and the comments I present in this blog series are not case specific but rather intended to provide the public with helpful information on Pennsylvania divorce law.

Follow me on Twitter @jdvisco.

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Even though your car may sustain minimal property damage in an accident, it is possible that you may be seriously hurt, and entitled to a significant amount of money.  I recently assisted a Bucks County woman recover almost $100,000 when she had less than $500 worth of property damage to her car when she was rear-ended by another driver.  By using experts, we were able to prove that my client’s life had been significantly altered by the accident. 

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It has been alleged Kate Gosselin states in her divorce complaint that Jon and her have been living “separate and apart” for the past two years.  Many viewers of the show are claiming they have been “duped” and now believe the past 2 years of their television show was a sham. The truth: no one has been duped, and Jon & Kate have not been separated for the last two years.

First, you need to understand the significance of the 2 year separation language in Kate’s complaint.
In Pennsylvania divorcing spouses must establish a legal reason (or “grounds”) in order for the court to grant a divorce.  Pennsylvania has two no-fault grounds for divorce:

1. consent by both parties that the marriage is irretrievably broken; and
2. the parties living separate and apart for two years and an acknowledgment by one of the parties that the marriage is irretrievably broken.

In Pennsylvania, it is common practice for the party filing for divorce to allege both of the no-fault grounds for divorce in the complaint.  This is done so that if the other party refuses to give their consent (option #1 above) the filing party (Kate) can still proceed under option #2 once they establish the 2 years of separation.  Option #2 can be established despite the other party’s refusal to consent.

Absent one of the two no-fault grounds being established above, Kate (as the plaintiff) would have to proceed on a fault based ground (such as indignities or adultery) in order to get a divorce.
Obviously proceeding on a fault based ground, while wonderful for tabloids, would only further divide the parties, increase hostility, prolong the divorce and ultimately subject the children to unnecessary animosity.

This case clearly seems to be heading down the path for option #1: both parties will ultimately consent that the marriage is irretrievably broken.

The high profile of Jon and Kate provides the public with a unique opportunity to explore issues that arise in contested divorce cases. Through this ongoing series I will offer comments and analysis of the proceedings and provide insight on how developments in Jon and Kate's case may occur in other divorces.  I am a Pennsylvania divorce attorney who is not involved in the Jon and Kate matter and the comments I present in this blog series are not case specific but rather intended to provide the public with helpful information on Pennsylvania divorce law.

Follow me on Twitter @jdvisco.

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It is official.
 
On Monday, June 22, 2009 Katie I. Gosselin filed for divorce against Jonathan K. Gosselin in the Montgomery County Court of Common Pleas, Norristown, Pennsylvania.
 
Per the complaint, the address listed for both parties is Sinking Springs, Berks County, Pennsylvania.
 
Hmmm.  The first question that comes to mind is why didn’t Kate file in her home county?  Is she allowed to file wherever she wants?
 
First of all, just to clarify - this is not a jurisdictional issue: Pennsylvania, where the parties have lived and currently reside, certainly has jurisdiction to decide the case and divorce the parties.  What is at issue is venue: specifically, what court in Pennsylvania should hear the case.
 
Thankfully, we have laws which decide these procedural issues.
 
The relevant law is found in Chapter 23 of the Pennsylvania Consolidated Statues, Section 3104, which states:
 e) Venue.--A proceeding for divorce or annulment may be brought in the county:

1. where the defendant resides;
2. if the defendant resides outside of this Commonwealth, where the plaintiff resides;
3. of matrimonial domicile, if the plaintiff has continuously resided in the county;
4. prior to six months after the date of final separation and with agreement of the defendant, where the plaintiff resides or, if neither party continues to reside in the county of matrimonial domicile, where either party resides; or
5. after six months after the date of final separation, where either party resides. 

When you apply each of the above enumerated provision to the case we find: 

1.  the defendant (Jon) resides in Berks County;
2.  not applicable - Jon resides in the Commonwealth of Pennsylvania;
3.  matrimonial domicile - Berks County;
4.  where the plaintiff or either party resides - Berks County;
5.  where either party resides - Berks County.

Based upon the information known to the public, this divorce belongs in Berks County.
 
However, Rule 1920.2 of the Pennsylvania Rules of Civil Procedure also addresses venue in a divorce action.
 
Rule 1920.2 provides:
 
(a) The action, except for a claim for custody, may be brought only in the county
     (1) in which the plaintiff or the defendant resides, or
     (2) upon which the parties have agreed
          (i) in a writing which shall be attached to the complaint, or
         (ii) by participating in the proceeding.
(c) Notwithstanding any agreement of the parties, if neither the plaintiff nor the defendant has resided in the county at any time during the pendency of the action, the court, upon its own motion and for its own convenience, may transfer the action to the appropriate court of any other county where the action originally could have been brought.
 
So can they legally file in Montgomery County?
 
Yes. Legally they can be in Montgomery County if either one of the parties has established a residence in Montgomery County or the parties have already agreed in writing to Montgomery County.
 
My guess is the parties already have a written agreement to have the case heard in Montgomery County.
 
Why would they want to file in Montgomery County?
 
Privacy.  Go figure.  Berks County’s policy is to allow the public to access all legal pleadings filed with the court.  Montgomery County drastically limits public access to the records and, generally, only will release pleadings, orders and related documents to the parties or their attorneys.
 
Interestingly, by Rule, custody cannot be decided in Montgomery County.  Unless Jon and Kate agree on custody they will have to go back to Berks.
 
It is hard to believe that TLC does not have their hands in this matter.  By filing in Montgomery County they (or the parties) maintain greater control of the release of information.   Surely the creative producers at TLC will find a way to exploit this information black-out to boost the show’s ratings.
 
The high profile of Jon and Kate provides the public with a unique opportunity to explore issues that arise in contested divorce cases. Through this ongoing series I will offer comments and analysis of the proceedings and provide insight on how developments in Jon and Kate's case may occur in other divorces.  I am a Pennsylvania divorce attorney who is not involved in the Jon and Kate matter and the comments I present in this blog series are not case specific but rather intended to provide the public with helpful information on Pennsylvania divorce law.

Follow me on Twitter @jdvisco.

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Edward Shensky, Shareholder in Stark & Stark's Personal Injury Group, obtained a $3,200,000 settlement for a client and his family after he was electrocuted by an electric high voltage power line. Mr. Shensky's client owned a home whose back yard shared a property line with a utility right-of-way. The branches of a fast-growing tree, located in the right-of-way, surrounded an electric line leading to the client's home. Interference from the tree branches had caused repeated electrical outages over an extended period of time.

Mr. Shensky's client made numerous requests to the utility company to have the tree trimmed, however, they took no action. Mr. Shensky's client then took matters into his own hands, and climbed the tree in an attempt to trim the branches himself. Unfortunately, he came in contact with a high voltage power line and was electrocuted which caused severe and permanent brain damage.

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I’m in the process of a divorce in Bucks County, Pennsylvania.  My spouse and I are separated and I want to buy a townhouse in Newtown.  Can I buy it without having to worry about my spouse claiming ownership of it?

When you are separated and in the midst of a divorce, whether in Bucks County, Pennsylvania, or almost anywhere in the United States, you need to be mindful of any assets you acquire prior to a divorce decree being signed by a judge and the entry of an accompanying Order disposing of all marital property. 

While property acquired after separation, at least in Bucks County and all of Pennsylvania, is generally considered non-marital, it could be considered marital if the source of funds used to acquire the property existed prior to separation.  For example, if you are separated and you use funds to make a down payment on a condominium from a credit union account that accrued during the marriage, then that condominium would be considered marital property and subject to equitable distribution.  That means your spouse could have a claim to the condominium.  By using the tracing method a party is able to reveal the origination of the down payment.  Furthermore, earnings and losses on the investment may be considered marital and subject to equitable distribution. 

To safeguard a post separation acquisition from being considered marital property, it is best to use only funds earned after separation to make a post separation acquisition.

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John Cordisco, Shareholder in Stark & Stark’s Personal Injury group, was recently appointed to serve on the Pennsylvania State Advisory Board of the Association of Plaintiff’s Interstate Trucking Lawyers of America. The Association is the largest single group of plaintiff industrial trucking lawyers in America.

Mr. Cordisco has extensive experience litigating trucking accident cases throughout the state of Pennsylvania. He recently obtained a $3,000,000 settlement in the Middle District of Pennsylvania (U.S. District Court) for the family of a 12-year old boy who was killed as a passenger in a vehicle which was struck by a tractor trailer. The driver of the tractor trailer failed to conduct a pre-trip inspection, and subsequent discovery found that several brakes were out of alignment which contributed to his inability to bring his vehicle to a full and complete stop prior to colliding with the vehicle occupied by the minor. The settlement in this case was noted as one of the most significant results in the Middle District of Pennsylvania.
 

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Henry E. Van Blunk, Shareholder in Stark & Stark's Business & Corporate group, and Thomas D. Giachetti, Chair of Stark & Stark's Securities group, authored the article An Overview of Internal Succession Planning for the Registered Investment Advisor for the June 2009 edition of the CharlesSchwab Institutional Compliance Review.

The article discusses the critical components a company needs to consider in order to implement a successful succession plan. Mr. Van Blunk and Mr. Giachetti recommend advisors to formulate a succession plan which focuses on protecting existing client relationships, planning for business continuity and determining what will happen when an the advisory firm founders retire. You can read the full article online here.  

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Child support is frequently litigated by parents throughout Pennsylvania. In almost all divorce cases, a number is either agreed upon or ordered by the court.  Whatever the number, the payor believes it to be too high and the payee believes it to be too low.

So how did the court get this number and who are they to say it’s the right number?

The number is, with few exceptions, chosen based upon child support guidelines.  Bucks County, and all of Pennsylvania, require child support be awarded pursuant to these statewide guidelines.  The guidelines were created to insure that persons similarly situated (i.e. persons with the same earnings and number of children) are treated similarly. 

The guidelines are based upon the “Income Shares Model.”  The Income Shares model (used by Pennsylvania and 32 other states) is premised on the concept that a child of separated, divorced or never-married parents, should receive the same proportion of parental income that she or he would have received if the parents lived/remained together.  In other words, separated parents should spend the same amount on their children as non-separated parents.  The children’s lifestyles should not be compromised due to the parents failure to maintain a relationship.       

But how much do non-separated parents typically spend on their kids?

Numerous economic studies have been performed to determine the average amount spent on children in intact households.  The studies reveal that the proportion of household spending devoted to children is directly related to the level of household income and the number of children.  The child support schedule used in Bucks County represents the average expenditures on children for food, housing, transportation, clothing and other necessities typically provided by the parents.  The estimates used in the schedule to determine household expenditures is based on detailed national data and surveys.  The guidelines break up the total net monthly income of the parents into $50.00 increments (or income levels) and determine the average spent per income level for the number of children of the parents.  Each parent is then responsible for their proportional share of the guideline amount.  The party having partial physical custody would pay that amount as child support to the parent having primary physical custody.

For example:

Mom’s net monthly income is $6,000.  Dad’s net monthly income is $3,000.  The combined net monthly income of the parties is therefore $9,000.  Per the guidelines, at $9,000 the monthly basic child support obligation is $1,311 for one child, $1,741 for two children and $1,925 for three children.  Mom’s proportional share is 67% (6,000 divided by 9,000).  Dad’s proportional share is 33% (3,000 divided by 9,000).  If dad has primary custody of the children mom would pay $878 per month in child support to dad for one child (67% of $1,311); $1,166 per month in child support for two children (67% of $1,741) and $1,290 per month in child support for three children (67% of $1,925).

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Like many states before it, Pennsylvania has adopted the Uniform Trade Secrets Act (“UTSA”). Prior to its enactment, Pennsylvania relied on common law, as well as its criminal statutes to provide remedies for those who brought trade secret violation claims. What follows is a brief examination of Pennsylvania’s UTSA (“PUTSA”).

Definition of Trade Secret
The PUTSA defines a trade secret as follows:

Information, including a formula, drawing, pattern, compilation including a customer list, program, device, method, technique or process that:

(1) Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use.

(2) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

Injunctive Relief
The PUTSA provides that an “[a]ctual or threatened misappropriation may be enjoined.”  The insertion of the word “may” seems to indicate that just because a trade secret is misappropriated, an injunction will not automatically be granted. “Misappropriation” is a defined term in the PUTSA and generally speaking, means “acquisition of a trade secret of another by a person who knows or has reason to know that the trade secret was acquired by improper means.” 

If a person acquires the trade secret information by accident or mistake and then later learns that the information is a trade secret, the person misappropriates the information if the person discloses the information to another before materially changing his or her position based upon the information.

The PUTSA specifies that the injunction, if any, will terminate when the trade secret ceases to exist, but may be extended for a period of time to ensure the elimination of the commercial advantage the “misappropriator” may have received from his or her use of the trade secret.

Under exceptional circumstances, as set forth in the PUTSA, courts may allow the recipient of the trade secret to continue to use same, conditioned upon the recipient of the trade secret paying a royalty fee for no longer than the period of time for which use could have been prohibited. As set forth in the PUTSA, an exceptional circumstance may include a material or prejudicial change of position prior to acquiring knowledge or reason to know of the misappropriation that renders the prohibitive injunction inequitable.

Damages
Damages pursuant to the PUTSA can be broken down into two categories: monetary and exemplary (punitive damages).
 

Monetary:
The PUTSA provides that a victim of the trade secret misappropriation may receive an award of monetary damages. Pursuant to the PUTSA, courts have a wide array of ways to fashion the monetary remedy. Monetary damages can include both the actual lose caused by the misappropriation, the unjust enrichment caused by the misappropriation that is not taken into account in computing the actual loss, and, in some cases, a reasonable royalty for the misappropriator’s unauthorized disclosure or use of the trade secret.

Exemplary:
If willful and malicious misappropriation exists, the court may award exemplary (punitive) damages in an amount not exceeding two times the award of monetary damages awarded by the court.

Willful and malicious is defined in the PUTSA as including “[s]uch intentional acts or gross neglect of duty as to evince a reckless indifference” and an entire want of care so as to raise the presumption that the person at fault is conscious of the consequences of his carelessness.” 
 

Attorney’s Fees
Under the PTUSA, a court may award reasonable attorney’s fees, expenses and costs to the prevailing party if: (1) if the claim of misappropriation is made in “bad faith”; (2) a motion to terminate an injunction is made or resisted in bad faith; (3) the court finds “willful and malicious” misappropriation.     

Statute of Limitations
A person who has a potential claim for the misappropriation of a trade secret by another has three (3) years from the date that the misappropriation was or should have been discovered to bring his or her claim against the “misappropriator”.    

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