The case, Osowski v. AMEC Construction Management, Inc., involves a serious injury suffered by a workman during the construction of the New York Times Building in Manhattan. The appeal addressed the liability insurance policy for the construction site and a third-party action for indemnification and contribution brought by the defendants.
During the course of the litigation the injured plaintiff entered into a confidential settlement agreement with the defendants who are the plaintiffs in the third-party action. The defendant in the third-party action sought disclosure of the confidential agreement; the trial court ordered the disclosure, and the Appellate Division agreed that disclosure was required in order for the third-party defendant to defend itself.
The Appellate Division concluded that attempts by an attorney to resist disclosure of the agreement "cannot be viewed as anything but a clear attempt to perpetuate a fraud on the [trial] court....Moreover, counsel...appears to have acted in disregard of well-established discovery rules and demonstrated a lack of forthrightness and candor to the court by failing to come forward with the terms of the settlement agreement which directly concerned [the defendant's] defense in the third-party action. We believe that counsel's continued prosecution of the third-party action against [the third-party defendant] after [the defendants in the principal action] entered into the settlement agreements raises substantial questions under the Code of Professional Responsibility." The decision can be found here.
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