Bove v. Akpharma Inc.

          Argued May 21, 2019

          On appeal from the Superior Court of New Jersey, Law Division, Atlantic County, Docket No. L-0982-15.

          Neil M. Mullin argued the cause for appellant (Smith Mullin, PC, and Niedweske Barber LLC, attorneys; Neil M. Mullin and Kevin Edward Barber, of counsel; Nancy E. Smith, on the brief).

          Roberto A. Rivera-Soto argued the cause for respondents (Ballard Spahr LLP, attorneys; Roberto A. Rivera-Soto and Casey Gene Watkins, of counsel and on the brief).

          Deborah Lynn Mains argued the cause for amicus curiae New Jersey Association for Justice (Costello & Mains, LLC, attorneys; Deborah Lynn Mains, on the brief).

          Before Judges Fisher, Suter and Enright.

          OPINION

          ENRIGHT, J.S.C.

         Plaintiff, Charles L. Bove, appeals from an order granting summary judgment to defendants, AkPharma Inc. and its CEO, Alan Kligerman, and denying his motion to strike defendants' affirmative defense under the Workers' Compensation Act (WCA), N.J.S.A. 34:15-1 to -146. Bove also appeals from an order entering judgments for sanctions against his attorneys under Rule 1:4-8. We affirm the two rulings granting summary judgment and denying Bove's motion to strike, but reverse the order imposing sanctions.

         In November 2013, Bove filed a workers' compensation claim and then in August 2014, he filed a companion civil suit against AkPharma Inc. and Kligerman. Both actions involved claims arising from Bove's use of a nasal spray product called "NasoCell." Bove's civil complaint was dismissed without prejudice so the parties could explore alternative dispute resolution, but when attempts at settlement failed, Bove refiled his civil complaint in April 2015. In his complaint, Bove alleged defendants were liable for fraudulent concealment, battery, and prima facie tort, based on Bove's use of NasoCell. In response to the refiled complaint, on May 5, 2015, defendants' counsel sent Bove's counsel a "safe harbor" letter, per Rule 1:4-8(b)(1). That letter made no mention of Bove's separate workers' compensation petition nor the exclusivity bar under the WCA. Instead, the letter generally indicated Bove's factual allegations about his use of NasoCell were contrary to the evidence and that there was no scientific evidence linking his alleged injuries to NasoCell. The "safe harbor" letter also contended Bove's legal claims were contrary to New Jersey law and were "governed exclusively by the New Jersey Product Liability Act" (PLA), N.J.S.A. 2A:58C-1 to -11. In response to this letter, Bove's counsel filed an amended complaint, outlining five causes of action, namely, fraudulent concealment, battery, prima facie tort, strict products liability/design defect, and strict liability/failure to warn.

         In July 2015, defendants moved to dismiss the amended complaint or, alternatively, for summary judgment based on the WCA bar. On April 19, 2016, the court dismissed the prima facie tort action, denied dismissal as to the other counts and denied, without prejudice, defendants' motion for summary judgment. Shortly thereafter, the trial court ordered discovery limited to the application of the WCA litigation bar. In October 2016 and March 2017, supplemental orders were entered to extend discovery and to allow Bove's counsel time to engage a scientific expert.

         In June 2017, Bove filed a motion to strike defendants' affirmative defense of the WCA's litigation bar. Defendants opposed this motion and renewed their request for summary judgment. The trial court then conducted a five-day evidentiary hearing in July 2017, to determine whether Bove could proceed with his civil suit or was barred from doing so under the WCA. The trial court heard testimony from Bove, Kligerman, and their respective experts during this hearing.

         On August 4, 2017, the trial court denied Bove's motion to strike defendants' affirmative defense of the WCA's litigation bar and granted defendants' motion for summary judgment. Defendants then timely moved for a frivolous litigation award, seeking reimbursement in the sum of $702, 819.87 for counsel fees, costs and expert fees. On December 13, 2017, the trial court partially granted defendants' request for sanctions and entered judgments against Bove's attorneys amounting to $205, 147.82. Each firm representing Bove was directed to pay half of this award.

         Bove appeals from the August 4, 2017 and December 13, 2017 orders. The New Jersey Association for Justice (NJAJ) joins in his appeal, as amicus curiae.

         The two opinions accompanying the orders at issue reflect extensive fact- findings, which we need not repeat here. Instead, we highlight only those facts salient to our analysis and note the trial court accurately captured the testimony of the parties and their experts, including the error committed by Bove's expert in misreading the content and meaning of a Food & Drug Administration (FDA) public notice about "Nasal Moisturizer Drug Products."

         According to the testimony from the evidentiary hearing, Bove was hired by Kligerman in 2003 on a part-time basis. Soon, he became a full-time employee and the Director of Clinical Studies at AkPharma. By 2007, he was engaged in discussions with Kligerman about NasoCell, the nasal spray product Kligerman had developed. NasoCell was comprised of calcium glycerophosphate (CGP) and distilled water. Kligerman used this product personally and decided to put the mixture into a spray bottle. He claimed NasoCell helped him with his asthma and that several of his family members also used NasoCell.

         The testimony from the evidentiary hearing confirms Kligerman suggested Bove and other AkPharma employees use NasoCell spray. It is uncontroverted that some employees declined to use NasoCell but Bove agreed to try it. He used NasoCell from 2007 to as late as 2010, documented the effects he observed while using this product, and submitted his observations to Kligerman. The record reflects Bove often used NasoCell outside the workplace and in his home, and he provided many positive reviews about his use of NasoCell.

         When NasoCell's ingredients were modified and the product became known as "NasoCell-S," Bove continued to use this modified product. The record shows Bove's use of NasoCell-S was unsupervised, except on one occasion when Bove testified he felt pressured to use the product because Kligerman followed him into a bathroom at work to watch him use it. However, on cross-examination, Bove conceded "nobody had a gun to (his) head" to use the product and he "did it for Alan (Kligerman)." The record also reflects that in January 2008, Bove completed a survey at work, advising he wanted to continue to be a panelist to study NasoCell and to receive another bottle of the spray. Bove was unsure when he stopped using NasoCell, but did not believe he used it after defendants received a "full clinical hold letter" from the FDA in 2010, testifying, "I pretty much washed my hands of it after that."

         For his part, Kligerman denied pressuring Bove at any time to use NasoCell and testified Bove was enthusiastic about the product. Kligerman also testified he personally used NasoCell several times a week, starting in 2007, and as of the time of the evidentiary hearing, he and his family members continued to use NasoCell on a regular basis with no negative effects. Kligerman was unwavering in his testimony that NasoCell was safe and that Bove voluntarily used the product. Further, there was no evidence presented at the hearing of any adverse action taken against Bove or other employees at AkPharma who declined to use NasoCell or started but then stopped using NasoCell.

         In August 2010, AkPharma received a full clinical hold letter from the FDA, essentially placing a hold on any further clinical study of NasoCell as a drug until certain stated deficiencies were cured. There is no dispute Bove knew NasoCell did not have FDA approval before he used the product. Concerned about incurring additional expenses, AkPharma discontinued development of NasoCell as a drug and explored its development as a cosmetic. However, NasoCell never got past the early planning and development stage, it was not marketed to the public, and ultimately, it was abandoned by defendants altogether.

         In 2011, AkPharma terminated Bove and other employees as part of a workforce reduction. Then, in 2013, Bove was diagnosed with permanent endocrine failure and a colon tumor. Following these diagnoses, Bove researched the ingredients that had been used in NasoCell, such as CGP and parabens, and concluded his use of NasoCell had caused his health problems. He also asserted a number of medical professionals had connected his use of NasoCell to his ailments, but did not present any reports to support this contention.

         Based on these facts, the trial court granted defendants summary judgment in August 2017, finding Bove did not "vault" the exclusivity provision of the WCA. It explained Bove's proofs did not show that: (1) Kligerman knew his actions were substantially certain to result in injury or death to plaintiff; or (2) Bove's injuries and the circumstances of their infliction were more than a fact of life of industrial employment and beyond what the Legislature intended the WCA to immunize. The trial judge also stated that as AkPharma's Clinical Studies Manager, Bove's "involvement in the early stages of new products was apparently part of his duties." The trial judge found Bove: used NasoCell at work and at home; he made positive findings regarding its effectiveness; and then ceased using it, years prior to his initial workers' compensation petition. Moreover, the trial court noted that several years after Bove stopped using NasoCell, he had no medical evidence to support his claim that NasoCell caused his health problems.

         On the other hand, the trial court found Kligerman "was, and remains, very confident of the safety of the conduct he asked plaintiff to engage in. Not only has [Kligerman] used NasoCell regularly for the past several years, he has encouraged his family members to do so." Based on these and other observations, the trial judge concluded that "[s]uch are not the circumstances to support a civil claim for personal injuries by an employee against an employer" and there is no basis to waive the "cloak of immunity afforded an employer under the WCA." Additionally, the trial court determined "there are no facts in dispute that might support a finding by a reasonable jury that AkPharma knew with virtual certainty that Mr. Bove had been required to engage in conduct that would be harmful to him," adding, "the evidence is so one-sided that it is inconceivable that a jury would find that [d]efendant was substantially certain that [p]laintiff would suffer harm from his use of NasoCell." Thus, the trial court granted summary judgment in defendants' favor.

         We review the trial court's decision granting summary judgment de novo, using the identical standard that governs the trial court. Townsend v. Pierre, 221 N.J. 36, 59 (2015). We owe no deference to the motion judge's conclusions on issues of law. Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995). Additionally, we review the record "based on our consideration of the evidence in the light most favorable to the parties opposing summary judgment." Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 523 (1995).

         Rule 4:46-2(c) provides that a court should grant summary judgment when "the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact challenged and that the moving party is entitled to a judgment or order as a matter of law." Thus, a summary judgment motion should be denied if the non-moving party comes forward with evidence that reflects a "genuine issue as to any material fact challenged." Brill, 142 N.J. at 529.

         A summary judgment motion is not defeated simply by pointing to any fact in dispute. Ibid. Also, self-serving assertions unsupported by evidence are "insufficient to create a genuine issue of material fact." Miller v. Bank of Am. Home Loan Servicing, L.P., 439 N.J.Super. 540, 551 (App. Div. 2015) (quoting Heyert v. Taddese, 431 N.J. Super 388, 414 (App. Div. 2013)). "Competent opposition requires 'competent evidential material' beyond mere 'speculation' and 'fanciful arguments.'" Hoffman v. Asseenontv.Com, Inc., 404 N.J.Super. 415, ...