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This page is a compilation of recent developments in our firm’s Practice Areas. Updates are presented chronologically below. To sort by Practice Area, select a Practice Area from the menu at left.

S.C. Dep’t of Disabilities & Special Needs v. Hoover Universal, Inc., 535 F.3d 300 (4th Cir. 2008).
Docket No. 07-1190, decided July 30, 2008.
Practice Areas: Litigation

The South Carolina Department of Mental Health, the South Carolina Department of Disabilities and Special Needs, and the South Carolina State Budget and Control Board—Insurance Reserve Fund brought this products liability action in federal court against a Michigan corporation, invoking diversity jurisdiction. The district court granted the defendant’s motions for summary judgment based on the statute of repose and various statutes of limitations. While the summary judgment orders were on appeal, the plaintiffs filed a motion to vacate the summary judgment orders for lack of subject matter jurisdiction, alleging that they were arms of the State of South Carolina, and therefore were not “citizens” for purposes of diversity jurisdiction. The district court granted the motion and dismissed the case for lack of subject matter jurisdiction. On appeal, the United States Court of Appeals for the Fourth Circuit affirmed. The court found that under the four-factor test discussed in Maryland Stadium Authority v. Ellerbe Becket Inc., 407 F.3d 255 (4th Cir. 2005), all plaintiffs were arms or alter egos of the State of South Carolina and therefore could not be considered “citizens” for purposes of diversity jurisdiction.

In re Spence, 541 F.3d 538 (4th Cir. 2008).
Docket No. 06-2114, decided July 30, 2008.
Practice Areas: Bankruptcy

A debtor filed filed bankruptcy and sought to discharge her government-backed student loan debt pursuant to 11 U.S.C. § 523(a)(8), which permits the bankruptcy court to discharge student loan debt if repayment of those loans would constitute “an undue hardship on the debtor and the debtor’s dependents.” Under the Brunner test adopted by the Fourth Circuit, debtors must show that: (1) they cannot maintain, based on current income and expenses, a minimal standard of living for themselves and their dependents if forced to repay the loans; (2) additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of their student loans; and (3) they have made good-faith efforts to repay their student loans. The bankruptcy court found that the debtor satisfied the Brunner test and discharged the debt, but the district court reversed. On appeal, the United States Court of Appeals for the Fourth Circuit affirmed the district court’s judgment on the basis that the debtor had not demonstrated a good-faith effort to obtain higher-paying employment for which she was well-qualified. Therefore, the court found that she had not made good-faith efforts to repay her loans and that the circumstances did not indicate that her inability to maintain a minimal standard of living was likely to persist.

Williams v. Watkins, 379 S.C. 530, 665 S.E.2d 243 (Ct. App. 2008).
Opinion No. 4429, decided July 23, 2008.
Practice Areas: Personal Injury

The plaintiffs operated a foster care home and community training home through a contract with Babcock Center, a state contractor which provides program for vulnerable adults. A client of the plaintiffs’ foster care home reported allegations of sexual abuse to Babcock Center’s administrator, who reported the allegations to the Department of Social Services and ultimately terminated Babcock Center’s contract with the plaintiffs. The plaintiffs filed this action against the administrator and Babcock Center, alleging defamation and infliction of emotional distress, but the trial court granted summary judgment to the defendants, holding that the Omnibus Adult Protection Act shielded them from liability. On appeal, the South Carolina Court of Appeals affirmed, finding that the client was a “vulnerable adult” under the Act, that the administrator was required under the Act to reported suspected abuse of the client, and that the defendants were therefore shielded from liability absent evidence that the administrator’s report was not in good faith.

State v. NV Sumatra Tobacco Trading Co., 379 S.C. 81, 666 S.E.2d 218 (2008).
Opinion No. 26522, decided July 21, 2008.
Practice Areas: Litigation

The State of South Carolina filed a complaint against an Indonesian cigarette manufacturer for its failure to comply with the Tobacco Escrow Fund Act. The manufacturer moved to dismiss for lack of personal jurisdiction, but the trial court denied the motion and later granted summary judgment to the State, awarding a civil penalty of over $300,000. On appeal, the manufacturer argued that the trial court erred by denying its motion to dismiss. However, the South Carolina Supreme Court held that the trial court was correct to find that South Carolina courts could exercise personal jurisdiction over the manufacturer. The court held that by selling millions of cigarettes in South Carolina and the rest of the United States, among other factors, that the manufacturer availed itself of conducting business in South Carolina and should have reasonably anticipated being haled into court in this state. The court also found that the exercise of personal jurisdiction over the manufacturer was “reasonable” and “fair” because the State’s interest in protecting itself through the Tobacco Escrow Fund outweighed any inconvenience suffered by the manufacturer in defending itself in South Carolina.

M&M Group, Inc. v. Holmes, 379 S.C. 468, 666 S.E.2d 262 (Ct. App. 2008).
Opinion No. 4427, decided July 15, 2008.
Practice Areas: Contract Law

The plaintiff and defendant entered into an agreement whereby the defendant would purchase the assets of the plaintiff’s business. The agreement contained a recital stating: “Whereas, the parties agree that Buyer’s obligation to purchase the assets of the business and Seller’s obligation to sell the assets is contingent upon Buyer’s ability to secure commercial financing at prevailing interest rates.” After the defendant failed to close the transaction for lack of financing, the plaintiff sued for breach of contract. The trial court granted summary judgment to the defendant on the grounds that a condition precedent was not met. On appeal, the plaintiff argued that the contingency language could not be read as a condition precedent because it was merely a recital. However, the South Carolina Court of Appeals held that a recital may contain operative language if it is clear that the parties so intended. The language “is contingent upon” clearly indicated the parties intend to condition the contract upon the defendant’s ability to obtain financing. Because the condition was not met, the court affirmed the trial court’s grant of summary judgment for the defendant.

Mozingo & Wallace Architects, LLP v. Patricia Grand, 379 S.C. 478, 666 S.E.2d 267 (Ct. App. 2008).
Opinion No. 4426, decided July 15, 2008.
Practice Areas: Mechanic's Liens

An architect entered into an agreement with a hotel owner to perform schematic design work for planned renovations to the hotel. Over the next several months, a dispute arose between the parties regarding the timeline for the renovations. The dispute culminated with the architect terminating his services and demanding full payment for his services rendered up to that point. The hotel owner refused to pay, so the architect filed a mechanic’s lien and subsequently brought this action to foreclose the lien. The trial court found in favor of the architect and awarded the amount requested in the notice of mechanic’s lien, prejudgment interest, and attorneys’ fees. On appeal, the hotel owner argued that the architect had not complied with its obligations under the scope of the parties’ agreement, but the South Carolina Court of Appeals found that there was sufficient evidence in the record to support the trial court’s finding that the architect either fulfilled its responsibilities under the agreement or was prevented from doing so by the hotel owner. The court also upheld the trial court’s determination that the architect’s award of attorneys’ fees was statutorily limited to the amount set forth in the notice of mechanic’s lien.

Hatfill v. The New York Times Co., 532 F.3d 312 (4th Cir. 2008).
Docket No. 07-1124, decided July 14, 2008.
Practice Areas: Personal Injury

The plaintiff, a prominent bio-defense research scientist, filed this defamation action against a national newspaper. The plaintiff claimed that several columns published in the newspaper suggested that he was responsible for the mailing of anthrax spores to several members of Congress and news organizations in late 2001. The district court granted summary judgment in favor of the newspaper on the grounds that the plaintiff was either a public figure or a limited-purpose public figure and that he had failed to meet his requisite burden of showing constitutional actual malice on the part of the newspaper by clear and convincing evidence. On appeal, the United States Court of Appeals for the Fourth Circuit affirmed, holding that the plaintiff was a public figure for the limited purpose of the controversy regarding the threat to national security posed by bioterrorism. Therefore, the plaintiff was required to show that the newspaper made the alleged defamatory statements with knowledge of their falsity or with reckless disregard of their falsity, which the court held the plaintiff failed to do.

McNair v. Fairfield County, 379 S.C. 462, 665 S.E.2d 830 (Ct. App. 2008).
Opinion No. 4425, decided July 8, 2008.
Practice Areas: Litigation

Fairfield County served a condemnation notice on the plaintiff informing him that the county intended to condemn a tract of land he owned in order to extend a runway at the Fairfield County Airport. The plaintiff filed this action challenging the condemnation and sent discovery requests to the county. The county failed to adequately respond to the discovery requests, and the court granted the plaintiff’s motion to compel adequate discovery responses. Subsequently, the plaintiff’s attorney wrote the county six times over the next six months requesting that the county comply with the order, but the county failed to do so. Finally, the plaintiff moved for dismissal of the condemnation action and for sanctions against the county. At the hearing on the plaintiff’s motion, the trial court gave the parties forty-five days to reach an agreement or to submit proposed orders. The parties did not reach an agreement, so the plaintiff filed a proposed order, but the county did not. The trial court signed and entered the plaintiff’s proposed order dismissing the county’s condemnation action with prejudice. The trial court also denied the county’s motion for reconsideration. On appeal, the South Carolina Court of Appeals affirmed, finding that although the sanction for the county’s discovery abuse was harsh, the trial court had not abused its discretion in finding that the county’s actions were an affront to the integrity of the judicial system and therefore warranted dismissal.

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