Experience
Stradley Ronon Secures Appellate Win for TD Bank on New Jersey Claims Arising from Law Enforcement Involvement
A Stradley Ronon has secured a significant win for TD Bank before the New Jersey Superior Court, Appellate Division, which affirmed the trial court’s grant of summary judgment in the client’s favor. In Wimbish v. TD Bank, the plaintiff sought to hold TD Bank liable under a negligence theory after criminal charges stemming from an attempted check transaction were later dismissed. The Appellate Division rejected that theory, agreeing that New Jersey does not permit plaintiffs to use negligence as a lower-standard substitute for malicious prosecution.
The decision builds on important New Jersey precedent, including Morris v. TD Bank, another prior TD Bank win, in which the Appellate Division declined to recognize negligence-based claims that would undermine the state’s strong public policy encouraging cooperation with law enforcement. In Wimbish, the court reaffirmed that where a plaintiff’s alleged harm flows from a criminal prosecution, the proper claim, if any, is malicious prosecution, a cause of action requiring a substantially higher showing, including malice and lack of probable cause.
The ruling is an important confirmation for financial institutions and other businesses that New Jersey courts will not expand negligence law to penalize citizens or businesses for contacting or assisting law enforcement. It also reinforces TD Bank’s successful defense strategy in a line of cases addressing attempts to recast malicious-prosecution allegations as ordinary negligence claims.
Andrew I. Hamelsky and Maxx M. JohnsonPennsylvania Supreme Court Rules Sureties Are Not Liable for Bad Faith
Stradley Ronon partner Patrick Kingsley and counsel Adriel Garcia secured a significant victory for surety companies in Pennsylvania. In Eastern Steel Constructors v. International Fidelity Insurance, 2026 WL 457805 (Pa. 2026), the Pennsylvania Supreme Court ruled that Pennsylvania’s insurance bad-faith statute does not apply to sureties or surety bonds. The subcontractor, Eastern Steel Constructors, had asserted a payment bond claim, which was denied in part. It argued a surety should be liable for bad faith under the statute because suretyship and insurance are essentially the same thing. Mr. Kingsley presented oral argument before the Supreme Court and convinced them otherwise.
The Supreme Court found the plain language of the statute only applies to “insurance policies” written by “insurers.” The court found that language “clearly and unambiguously does not encompass a surety bond.” The court was persuaded that insurance and suretyship were fundamentally different and had been recognized as different for quite some time, citing the 1996 Pennsylvania Supreme Court case Foster v. Mutual Fire, Marine and Inland Insurance, which itself quotes the 1962 U.S. Supreme Court case Pearlman v. Reliance Insurance. As a result, the court concluded that “the General Assembly did not intend to subject surety bonds to the bad faith statute.”
Until Eastern Steel Constructors, there had not been a published Pennsylvania appellate court decision on the applicability of the bad-faith statute to sureties. This historic ruling from Pennsylvania’s highest court resolves the issue in Pennsylvania once and for all.
Mr. Kingsley previously succeeded in reversing the law in New Jersey regarding the applicability of bad-faith claims to sureties. In the 2010 case of SBW v. Ernest Bock & Sons, the U.S. District Court for the District of New Jersey rejected the holding in the 2000 case of U.S. ex rel. Don Siegel Construction v. Atul Construction, which recognized such a bad-faith cause of action against sureties. The SBW case has since been cited several times with approval, marking a reversal in New Jersey law.
Patrick R. Kingsley and Adriel J. GarciaStradley Ronon Secures Summary Judgment Victory for Bank in Multimillion-Dollar Theft Case
After 10 years of litigation, a Stradley Ronon team has secured summary judgment on behalf of a bank in the U.S. Court of Appeals for the Second Circuit in a complex case involving a multimillion-dollar burglary affecting a safe deposit box.
The plaintiff, an LLC formed solely to pursue this lawsuit, filed suit over the theft. Central to the dispute was the ownership of the box’s contents and whether the LLC had standing to bring the claim. During discovery, the individuals who rented the box admitted they did not own the items inside and instead asserted they were holding the items for an unidentified third party.
In response, the bank argued the renters lacked the authority to transfer ownership or title to the contents of the box. Furthermore, the bank contended that the assignment on which the lawsuit was based was invalid, as it failed to convey ownership or title of the stolen contents.
On summary judgment, the bank raised defenses for lack of standing and an invalid assignment. The plaintiff opposed the motion and also sought leave to amend its complaint in an attempt to cure the standing deficiencies. The U.S. District Court for the Eastern District of New York ruled in favor of the bank, dismissing the case for lack of standing and denying the plaintiff’s request to amend as untimely, prejudicial and futile.
On appeal, the Second Circuit upheld the district court’s dismissal, bringing this long-running litigation to a close. The victory reinforces the importance of legal precision and the critical need to assert jurisdictional defenses at the inception of any case.
Andrew I. Hamelsky, Jenifer A. Scarcella, Sabina Corrado, Maxx M. Johnson and Steven D. Feldman
Stradley Ronon Attorneys Victorious in Historic Appellate Decision Granting the Garden State’s Largest and Oldest Health Insurer, Horizon, to Reorganize Corporate Structure
New Jersey’s appellate court issued an opinion today, May 31, 2023, in a matter concerning a challenge to the reorganization of Horizon Blue Cross Blue Shield of New Jersey, deciding whether the almost a century-old health insurance carrier could reorganize its corporate structure to a mutual insurance holding company. The court unanimously upheld Stradley Ronon’s arguments on behalf of Horizon to reorganize as a mutual holding company saying, “As Horizon correctly noted at oral argument, on the critical issue of membership in the new MHC, the statute controls. For these reasons, based on the facts presented, we are unconvinced the revelation of this information at the public hearings would have led to a different result.”
Andrew I. Hamelsky, partner-in-charge of the firm’s Newark office and member of the firm’s healthcare litigation team, defended and argued on behalf of Horizon Healthcare Services, Inc. on May 1, 2023. The Stradley Ronon team also included Spencer R. Short and Deenah Sirota.
Stradley Ronon’s arguments focused on how the corporate reorganization will benefit the State, including creating a more modern structure that will allow Horizon to provide better services to their members by partnering with innovative healthcare companies.
Stradley Ronon worked closely with Horizon representatives, state agencies and partners on this landmark application.
Andrew I. Hamelsky, Spencer R. Short and Deenah SirotaAppellate Court Victory for Hyperion Bank in Significant Title Dispute Litigation
Stradley Ronon’s client, Hyperion Bank, was victorious in a significant decision for the banking industry. On July 28, 2022, the Superior Court of Pennsylvania affirmed the dismissal of a lawsuit against Hyperion Bank. The suit alleged fraudulent deed transfers and sought to render the transfers and Hyperion’s mortgage and other security interests null and void. The Court held that an action challenging a deed transfer accomplished through a sheriff’s tax sale pursuant to 53 P.S. § 7283, even assuming that such a challenge could survive the “absolute title” conveyed by the sheriff, is subject to a six-year statute of limitations and that the equitable doctrine of laches also precluded the plaintiff/appellant’s claims which challenged the tax sale and the bank’s security interests in the real estate approximately seven years later.
Jeffrey D. Grossman
