Volume 49, Issue 1- January 2014

Legislation&Legal

Federal Lawsuit Concerning Shattered
Glass at Hotel Continues in Texas

A federal suit resulting from a shattered glass incident at a W Hotel in Texas more than two years ago is moving forward without one of the original defendants. According to court documents, Steel Studio USA Inc. filed for Chapter 7 bankruptcy protection in Delaware and has been released from all claims in the case, which is being heard before Judge Lee Yeakel of the U.S. District Court for the Western District of Texas. That leaves Xinyi Glass alone to face negligence and breach-of-contract charges by Illinois-based Old Republic General Insurance Corp.

The three incidents of falling glass occurred at the W Hotel in Austin between June 10 and June 28, 2011, raining glass down upon the surrounding area and forcing the hotel’s closing for a period of time, as well as the immediate evacuation of guests and nearby residents.

Old Republic, seeks to recover more than $1 million and contends the incidents were the result of “defectively designed, engineered and/or manufactured balcony railings (from the Steel Studio railing system) and/or defectively manufactured glass panels” supplied by Xinyi Glass to subcontractor Custom Components LLC, according to court documents.

China-based Xinyi Glass has denied any negligence on its part, saying that it properly explained the tendency of tempered glass to break spontaneously to Glass 3 Enterprises (GE3), the company that bought the 10 millimeter lites of clear, tempered glass before selling it to Custom Components LLC for installation. GE3 refused an additional heat-soak treatment that may have prevented such an occurrence, says Paul Huckabay, the San Antonio-based attorney representing Xinyi Glass, according to court papers.

Efforts to reach either Huckabay or David J. Schubert, the Dallas-based attorney representing Old Republic, were unsuccessful.

In filing suit in July 2013, Old Republic alleges that Xinyi Glass was negligent by providing glass to them that included nickel sulfide inclusions, thereby rendering them “susceptible to sudden failure under certain conditions.”

Old Republic says it plans to add Quality Design Services LLC as a defendant in the case, alleging that the Florida-based company was negligent in designing certain aspects of the railing system that contained the glass that shattered.

Committee Recovers Money to Repay Trainor Creditors

Multiple companies have now agreed to return some of the money given to them by the Trainor Glass Co. in the 90 days prior to its Chapter 11 bankruptcy petition in 2012, pushing the total recovered by the Official Committee of Unsecured Creditors to nearly a half million dollars.

NPW Contracting Inc., Architectural Systems Inc. and Kawneer Co. Inc. reached a deal on December 20 to repay nearly $265,000 collectively, according to records filed with the U.S. Bankruptcy Court for the Northern District of Illinois. Just two weeks earlier, Mestek Inc., Trulite Glass & Aluminum and Connelly Crane Rental Corp. reached similar deals for a total of $178,000, according to court records.

Per the terms of the settlements, the companies returning the money are released from any future liabilities without any admission of wrongdoing, according to court documents.

Court records show that Architectural Systems Inc. will repay $250,000 to avoid any further legal action. The sum, which will be payable by three installments, is considerably less than the more than $813,000 the committee had originally sought.

NPW Contracting Inc., of Denver has agreed give back $8,500, while Kawneer Co. Inc. will reimburse Trainor Glass to the tune of $6,250, according to court documents. Creditors had hoped to recover nearly $150,000 from Kawneer.

The latest arrangements come on the heels of the $75,000 collectively recovered in late November from Firestone Building Products Co. LLC and Facility Construction Services Inc.

ASI Ltd. Continues to Face Legal Woes

Legal troubles are continuing to follow the now defunct ASI Ltd. of Whitestown, Ind., which shut its doors more than two years ago, allegedly laying off close to 300 workers without notice. A federal judge has now given the okay for a class action suit to move forward against it.

Judge Sara Evans Barker of the U.S. District Court for the Southern District Court of Indiana rejected claims by ASI Ltd. that most of the plant’s employees did not fall under guidelines of the Worker Adjustment and Retraining Notification (WARN) Act of 1988 that mandates employers with 100 or more full-time employees give workers 60 days’ notice before a plant closing or mass layoff. Originally filed in February 2012, Andrew Shepherd’s legal action on behalf of the 273 listed former employees contends that ASI failed to do that when it shuttered its doors December 22, 2011, laying off all of the plant’s employees, including Shepherd.

Shepherd is seeking unpaid wages, salary, commissions, bonuses, accrued holiday pay, accrued vacation pay pension and 401(k) contributions and other benefits he alleges would have been covered and paid under the “then-applicable employee benefit plans had that coverage continued for that period, for 60 working days following the member employee’s termination,” according to court records.

Shepherd is represented by Mobile, Ala.-based attorney David C. Tufts and is asking for attorneys’ fees and a trial by jury.

ASI, which is listed as a defendant in the case along with Winston Development LLC and S&S Racing LLC, the two companies that shared the facility, has never disputed that plant workers were terminated without notice, according to court documents. The company, however, objected to Shepherd’s number of employees affected, contending that many were not eligible under the WARN Act because many—but not al—had been re-hired by the Ohio Farmers’ Insurance Company that had purchased ASI’s assets from PNC Bank before reconstituting the plant. Those re-hired employees would not have suffered “employment loss,” argued ASI’s Indianapolis-based attorney John K. McDavid. The company also contended that part-time employees and those who worked offsite and did not “work at or report to the ASI facility” were not covered by the federal law, according to court documents.

In another legal case, the trustees of the Indiana State Council of Roofers and Health and Welfare Fund have asked a federal judge to make a default judgment in their favor in their breach of contract lawsuit against ASI. In court papers filed with the U.S. District Court of the Northern District of Indiana, Evansville, Ind.-based attorney Charles L. Berger alleges that ASI owes more than $111,000 to the Indiana State Council of Roofers Health and Welfare Fund, a multi-employer employee benefit plan that provides health, welfare and other benefits for employees of employers who contribute into its plan. Nearly $4,000 more in dues is owed to the International Union of Painters and Allied Trades Glaziers Local 387, as well as attorney fees and court costs, according to court documents.

The suit was originally filed in January 2012.


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