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November 2010 Archives

Supreme Court Rules Against Employee

Recently, the Texas Supreme Court ruled that a worker was required to arbitrate her employment discrimination claims against her employer even though she was an "at-will" employee. Normally, an employer cannot take away an employee's rights to bring a claim in the Texas court system unless the agreement to arbitrate has "consideration." That term means that the employer has given value in order to compel arbitration. Here, the employee was an "at-will" employee, and so the employer could fire her at any time for any cause (other than for an illegal reason, such as one based upon age, religion, or race). She therefore argued that the employer gave no consideration to remove her right to pursue a lawsuit. The Supreme Court disagreed.

The United States Public Interest Research Group

The United States Public Interest Research Group recently released their report on the safety level of toys and other children's products. Noting progress, not perfection, the organization found a small fraction of children's toys tested for toxic substances and choking risks to still be in violation of federal safety regulations. PIRG credited a 2008 federal law that imposed stronger regulations and standards on these products to help make them safer. In their 25th annual "Trouble in Toyland" report on hazardous playthings, the group focused on lead or other metal tainted toys, soft plastic toys that contain chemicals harmful to children -- in particular, phthalates -- and toys with small parts that can be choking hazard for young children.

Johnson & Johnson Issues Recall on Children's Products

Johnson and Johnson today recalled 4 million packages of children's Benadryl allergy tablets and about 800,000 bottles of junior-strength Motrin. A recent internal review revealed insufficiencies in the development of the manufacturing process, prompting J&J to issue the recall, which is currently only at the wholesale and retail levels. "There's no safety issue, and consumers don't have to take any action," said a spokeswoman for J&J. This is the latest setback for J&J, as recent recalls of Tylenol and several other over-the-counter brands for quality problems, such as musty odors and floating particles in some liquid solutions, have severely hurt the reputation and financial standing of the company. Because of these recent lapses in quality control, J&J is currently under governmental investigation over its handling of the recalls, as well as a criminal probe by the U.S. Justice Department.

Toyota Recall Litigation - District Judge Refuses to Dismiss Economic Loss Lawsuit

On Friday, November 19, U.S. District Judge James Selna issued a 63-page opinion, which temporarily refused to dismiss one of the class-action lawsuits brought by purchasers of Toyota vehicles. In that class action, plaintiffs' have sued Toyota for the diminished market value of their vehicles in light of the defects in those vehicles.

Tanker Truck Explosion at San Antonio Refinery Results in Over $12,000 in Fines

A tanker truck explosion at a fueling station has lead to $12,600 in fines for AGE Refining, Inc. After an investigation conducted by the Occupational Safety and Health Administration (OSHA), AGE Refining was cited for three safety violations.

DANGER LURKING BELOW

According to a recent Houston Chronicle investigation, more than half of the major natural gas transmission lines in Texas were laid more than 40 years ago and are "vulnerable to failure." In Texas, there is are nearly 46,000 miles of transmission pipe and, according to federal records, more than 25,000 miles are older than 1970. Some of the pipe dates back to the Great Depression. According to pipeline experts, and not surprisingly, older pipelines have inferior properties that make them more likely to fail.

Supreme Court Rules Against Texas Consumers

The Texas Supreme Court recently ruled against Texas consumers of electricity. The case was Texas Industrial Energy Consumers v. CenterPoint Energy Houston Electric, LLC, ___ S.W.3d ___, (Tex. 2010), and the opinion was handed down on October 22, 2010.
During the deregulation of electricity, Reliant Energy was divided into an electrical generation company, a retail provider, and CenterPoint, a transmission and distribution company. Electrical providers were allowed to recovery certain "stranded" costs including interest, as well as the costs of a "valuation panel" incurred when presenting the claim. Here, over the objection of consumers' groups, the Supreme Court affirmed a ruling for CenterPoint by the Public Utility Commission. That ruling allows CenterPoint to recover - and pass along to consumers - an imputed interest rate in excess of 11%. In addition, it will also be allowed to pass to consumers the costs of the experts it hired for its valuation panel, which exceed $5,000,000.
"The consumer groups argue that interest . . . is not allowed because we invalidated Rule 25.263(l)(3) in its entirety in [an earlier opinion]. The PUC and CenterPoint argue that we only invalidated the timing portion of the Rule - the date that interest begins to accrue. We agree with the PUC and CenterPoint."
The Court approved the costs of the valuation panel, approved by the PUC. "[T]he PUC, whose reasonable construction of PURA merits 'serious consideration,' [has] the better argument: '[B]y providing that the transferee corporations 'shall pay' valuation panel expenses, the legislature did not intend to preclude those expenses ultimately being recovered through rates under PURA 36.061(b)(2). [Section 39.262(h)(3)]. . . . It is true, as TIEC contends, that state-agency powers are limited, and agencies may not 'on a theory of necessary implication from a specific power, function, or duty expressly delegated, erect and exercise what really amounts to a new and additional power or one that contradicts the statute, no matter that the new power is viewed as expedient for administrative purposes.' But that admonition is inapposite here.

"Toyota's Safety Questioned Again"

The deadly crash of a Toyota Camry in western Utah is being blamed on a sticky gas pedal, the same problem that led the world's largest automaker to recall the car for repairs early this year. The 2008 Camry slammed into a rock wall near the Nevada border on Nov. 5, killing the driver and a passenger. The vehicle was the subject of three recalls, most recently for an accelerator that can get stuck in the open position.The crash raised questions about Toyota Motor Corp.'s system for repairing flaws in its vehicles. Safety advocates note that the government has received dozens of customer complaints about problems continuing even after a repair.

Rollerblade Recall

Rollerblade has recalled 29,000 pairs of Spark and Spitfire Inline Skates over injury risks. It was discovered that the frame mounting bold and wheel axle bolts may be loose on new skates, which would cause a rider to fall. These skates were sold at sporting goods stores nationwide and on the internet from September 2009 through July 2010. The Consumer Product Safety Commission urges all consumers to immediately inspect all wheel-axle and frame-mounting bolts to ensure that they are properly tightened.

Deepwater Horizon Investigation Continues

As the Deepwater Horizon drilling rig catastrophe investigation continues, it is becoming more and more apparent the companies who participated on this rig created an atmosphere that did not focus on safety. The presidential commission in charge of the investigation has uncovered an atmosphere of, at the very best, complacency for the safety rules and regulations, and at the very worst, an atmosphere of profits over safety. Further, at this initial investigation stage it appears that more than one company contributed to one of the greatest disasters of all time.

Noche de Las Américas Gala

On October 23, 2010 the Institute of Hispanic Culture celebrated its 45th Annual Noche de Las Américas Gala. The law firm of Abraham, Watkins, Nichols, Sorrels, Agosto & Friend is happy to be one of the sponsors of this historic celebration. This black-tie fundraiser celebrated the court of King Ferdinand and Queen Isabella and the expedition of Christopher Columbus, which introduced the Hispanic culture and language to the Americas. Benny and Nikki Agosto held the honorary titles of King Ferdinand and Queen Isabella at this year's gala.

CHAPERONE INFANT CAR SEATS RECALLED - CHOKING AND LACERATION HAZARDS

On November 4, 2010, the United States Consumer Product Safety Commission and Britax Child Safety Inc. announced a voluntary recall of the Chaperone Infant Car Seat. According to the recall, approximately 23,000 of these units have been imported into the United States from China. These units were sold at retailers nationwide and on the Britax website from June 2009 to October 2010 for about $230. This product was also recalled by the National Highway Traffic Safety Administration.

"Rental Car Companies Slow to Fix Recalls"

The Federal Trade Commission is being asked to explain why the rental car industry shouldn't have to live by the same rule that requires auto dealers to fix vehicles under recall notice before they can be sold. Safety groups say most business travelers or those renting cars for long trips don't know whether the vehicle they pick up at the rental lot has been the subject of a recall, posing a potential safety threat. The issue has taken on more significance this year following a series of safety recalls by Toyota Motor Co. and several large recalls involving other automakers.

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