Roseland
The Roseland, New Jersey, office of Marshall Dennehey opened in February of 1993. Since that time, it has realized substantial growth in response to client demand for our professional services. Roseland is in Essex County, home to Newark, New Jersey's largest city, and is within 30 minutes of New York City. The office services the densely populated counties of the northern part of the state. The attorneys practicing in our Roseland office have easy access to all of the federal and state courts of Northern New Jersey, which counties include Bergen, Essex, Hudson, Hunterdon, Middlesex, Monmouth, Morris, Passaic, Somerset, Sussex, Union and Warren.
Our Roseland office, like all of the firm's offices, provides the advantages of the personal attention of a small firm with the advantages that come from the intellectual property and broad-based experience of a large firm. The office is staffed by native and long-time residents of New Jersey who handle professional liability, product liability, employment, property and casualty, and workers' compensation defense litigation.
Thought Leadership
Defense Digest
When Immunity Ends: What Galette v. NJ Transit Means for Liability Exposure
June 30, 2026
Key Points: The U.S. Supreme Court ruled that New Jersey Transit Corporation is not an arm of the state and cannot claim interstate sovereign immunity. Plaintiffs can now sue NJ Transit in the state where an accident occurs, expanding litigation venues. Forum selection risk increases, including plaintiff-friendly jurisdictions. Expect higher defense costs and broader exposure in multi-state incidents. The United States Supreme Court’s decision in Galette v. New Jersey Transit Corporation, 607 U.S.(2026), marks a significant shift in how liability exposure is assessed for public transportation entities operating across state lines. In a unanimous ruling issued just last month, the Court held that NJ Transit does not qualify as an “arm of the state” for purposes of sovereign immunity. As a result, it can be sued in courts outside New Jersey. This ruling has substantial consequences, particularly for insurers, risk managers, and defense counsel handling casualty and liability claims. Sovereign immunity is a tool used to protect states and certain state entities from being sued without consent, especially in federal or out-of-state courts. Historically, organizations tied to state governments have used this doctrine to limit where they can be sued. Galette arose from separate accidents involving NJ Transit buses outside New Jersey state lines. One of the central cases involved Cedric Galette, who was injured in 2018, in Philadelphia, when a vehicle he occupied was struck by an NJ Transit bus. He filed suit in Pennsylvania. NJ Transit argued that, as an arm of the State of New Jersey, it could not be sued in another state’s courts. Lower courts rejected that position, and the issue ultimately reached the Supreme Court. The Supreme Court unanimously affirmed the decisions of the lower courts. Writing for the majority, Justice Sonia Sotomayor emphasized that sovereign immunity protects the state itself, not every entity it creates. The key question the Court addressed in its opinion was whether the state structured the entity as legally separate from the state itself. In this case, the answer was yes. In simpler terms, the Court found that NJ Transit should not be treated the same as the State of New Jersey when it comes to lawsuits. This decision has broader implications for how liability risk is evaluated across a range of public and quasi-public entities. Several factors informed the Court’s decision. First, the Court found that NJ Transit is a separate corporate entity with the power to sue and be sued, enter contracts, and hold property. Second, the Court found that it is financially independent: its debts and liabilities are not obligations of the State of New Jersey. Third, although the state exercises oversight, the Court found that this oversight did not override NJ Transit’s legal separateness. Taken together, the Court reasoned, these characteristics placed NJ Transit squarely outside the scope of sovereign immunity. This decision carries immediate implications for casualty and insurance professionals. Most importantly, it expands litigation exposure; plaintiffs are no longer limited to suing NJ Transit in New Jersey. Instead, they may bring claims in the state where an accident occurs. This increases the likelihood of cases being filed in jurisdictions with more favorable laws, higher jury awards, or procedural advantages for plaintiffs, and creates uncertainty in claims handling. Insurers will now be required to account for variability in legal standards, jury behavior, and damages depending on where a case is filed. What might have been a predictable exposure in one jurisdiction can become far less certain in another. The decision in Galette will also lead to an increased risk of forum shopping. Plaintiffs may strategically choose venues they believe will offer better outcomes, particularly in high-value bodily injury cases, complicating defense strategy and affecting every aspect of a case from early evaluation to settlement posture. The Court’s reasoning is not limited to NJ Transit: it signals that other quasi-public entities, like regional transportation authorities or public utilities, may face similar challenges if they attempt to use sovereign immunity as a shield to lawsuits. Courts will look closely at how an entity is structured, including its financial independence and legal status, rather than relying on labels or general affiliations with a state. For insurers, this decision raises important underwriting and risk assessment questions. Entities previously viewed as benefiting from immunity protections may now present broader and more complex exposure. Policy terms, limits, and pricing may need to be revisited to respond to an increased risk landscape. The Galette opinion also holds cost implications for insurers and defense counsel. Defending cases in a variety of jurisdictions typically increases costs, as the need for local counsel and varied procedural rules are factors that now must be considered. In jurisdictions known for higher verdicts, indemnity exposure may rise as well. These factors are particularly relevant in matters involving bodily injury, mass transit incidents, and multi-party accidents. In response to Galette, insurers and defense teams should place greater emphasis on early case strategy. Determining where a case may be filed and whether venue can be challenged will be critical issues to tackle early on. Coverage for public or quasi-public entities should take into consideration the possibility of multi-state exposure, increased defense obligations, and the potential for higher verdicts depending on the jurisdiction. The broader significance of Galette lies in its message: courts are willing to scrutinize claims of sovereign immunity and will not extend protections automatically. Entities that operate with a degree of independence, even if those entities are publicly created, may be treated more like private actors for liability purposes. For insurance professionals, the takeaway is straightforward: assumptions about immunity-based defenses should be revisited. Organizations that were once considered relatively insulated by sovereign immunity can now face expanded exposure, more complex litigation, and higher costs. In an environment where jurisdiction can significantly influence outcomes, Galette underscores the importance of anticipating not just whether a claim will be filed, but where it will be litigated. Haleigh works in our Roseland, NJ office. He can be reached at (973) 618-4153 or HACatalano@MDWCG.com.
Defense Digest
Don’t Waive Goodbye to Your Section 40 Lien Rights
June 30, 2026
Key Points: Under NJ workers’ compensation law, employers can assert a lien upon third-party actions for any medical and indemnity benefits paid. The employers are free to compromise or waive this lien. The Appellate Division found that a carrier cashing a check for less than the full lien amount, but accompanied by a letter stating this payment was full and final payment of the lien, constituted an agreement to waive the remainder of the lien. A chief concern of the workers’ compensation system in New Jersey has always been prevention of double recovery, in which an injured worker would obtain a “windfall” by receiving compensation from both a workers’ compensation claim and a third-party suit. In order to avoid this, the Workers’ Compensation Act provides the respondent with a lien against third-party proceeds. Known as the “Section 40 lien,” the respondent can assert a lien based on the medical and indemnity benefits it has issued for the workers’ compensation claim. The lien can be collected upon two-thirds of the third-party recovery, minus $750.00 for the costs of suit. As with most liens, a Section 40 lien can be negotiated. Employers will sometimes agree to compromise or, in some cases, even waive the lien. In the recent unpublished case of Tomaselli v. Petco, 2026 WL 585448 (N.J. Super. App. Div. April 3, 2026), the Appellate Division addressed a dispute as to whether an employer’s Section 40 lien had been compromised. In the case, the petitioner was employed as a store manager at Petco (insured by Sedgwick). On December 23, 2017, he was collecting shopping carts in the store’s parking lot when a car backed into him, causing injuries to his lower back. Since the petitioner was injured by a third-party tortfeasor in the course of his employment, he filed both a workers’ compensation claim against Petco and a suit against the driver. The third-party suit ended with a settlement of $85,000 in underinsured motorist (UIM) benefits and $15,000 in third-party settlement. At the time of resolution of the civil claim, Sedgwick had paid a total of $177,084.30 in benefits ($90,351.50 in medical and $86,732.80 in indemnity). This amount was not exhaustive, as the petitioner was still undergoing treatment and the costs would continue to increase. At that point, Sedgwick was entitled to recoup over $65,000.00 from the third-party settlement. However, in the spirit of compromise, they sent the petitioner a letter indicating that they would accept $33,333.33 from the UIM award and $15,000.00 from the third-party settlement. The petitioner’s lawyer sent a check to Sedgwick for $33,333.33 with a letter stating the check “represents full and final payment of any outstanding worker's compensation lien, in connection with the above-referenced claim." The check was cashed by the carrier. The workers’ compensation matter subsequently went to trial and ended with a judgment from the judge of compensation finding a percentage of permanent disability and further concluding that Sedgwick’s acceptance of the check for $33,333.33 with the aforementioned letter constituted an agreement to resolve the lien for only that amount. On appeal, Sedgwick argued that the mere act of cashing a check did not constitute a waiver of its Section 40 lien rights. The Appellate Division ruled that it did. They stated that Sedgwick was clearly aware of its rights to recover the full amount allowable under their Section 40 lien, and that “[b]y accepting and endorsing the check, Sedgwick clearly and unequivocally conveyed its intent to accept $33,333.33 as full and final payment of any outstanding workers' compensation lien.” While this is an unpublished opinion and therefore not binding, it will likely have persuasive authority for judges of compensation going forward. The impact of this case is significant. At most corporations, the high volume of checks received in the mail are sorted, endorsed, and deposited by an accounts receivable department or comparable business unit. However, in this opinion, the Appellate Division is ascribing significant decision-making authority to the action of one who is likely not a corporate officer, but a clerk. What are some actions that carriers can take to safeguard their Section 40 liens and prevent an unintentional waiver of same? The first is to enact policies requiring supervisory approval before any check pertaining to a Section 40 lien repayment is deposited. Systems should be enacted which will lead to any check pertaining to Section 40 lien repayment being flagged, and requiring a supervisor to review and approve before it is deposited. If there is no language on the check or accompanying paperwork indicating anything about “full and final” or “resolution” or “waiver” or any other terms to that effect, the check can be deposited without issue. If there is such language, consultation should be made with the workers’ compensation adjuster, defense counsel, or another designated party that can verify the full amount of the carrier’s Section 40 lien and determine whether any negotiated amounts have been agreed to by the carrier.If the check with such language is in the full amount (or the negotiated amount, if applicable), the check can then be deposited. If the check is for a lesser amount, it should be immediately sent back with a letter copying all pertinent parties, stating that the carrier is entitled to (state the full dollar amount of entitlement) and does not agree to accept a lesser amount. The carrier should then ask the addressee to advise whether they will be re-sending the proper amount or whether further legal action will be required. A second suggestion would be to designate that such checks need to be sent to defense counsel. This would task the carrier’s legal team with the job of verifying that endorsement of the checks does not unintentionally cause a waiver of lien rights. After review, the defense counsel can then pass the check on to the carrier or send back to the addressee, as the situation requires. A third cautionary step would be to issue a notice to petitioner’s attorney, indicating that the carrier is asserting its full lien rights under N.J.S.A. 35:15-40 and that going forward, the carrier does not consent to any compromise of its full entitlement unless noted in a formal agreement signed by both parties. While the service of this document by itself would be helpful, it would be optimal for it to be signed by petitioner’s attorney. Since the carrier is normally asked to produce a ledger showing the amount of its Section 40 lien, petitioner’s attorney should be told that production of the requested ledger will only be made upon receipt of the notice with their (the attorney’s) signature. The Tomaselli opinion has exposed a vulnerability in respondent’s rights to assert their full Section 40 liens they are entitled to under law. The carriers are entitled to recoup monies spent on medical and indemnity benefits. They should act with great care to ensure that entitlement isn’t lost through error. William J. Murphy is in our Roseland office. He can be reached at (973) 618-4129 or at wjmurphy@mdwcg.com.
Results
No-Cause Jury Verdict Secured in Wrongful Death Trial
We successfully obtained a no-cause jury verdict in a 13-day wrongful death trial. The decedent, a 59-year-old man, was admitted to the emergency room on February 15, 2019, with complaints of abdominal pain, decreased appetite, and constipation, despite the use of laxatives. The patient did not complain of any nausea, vomiting, or diarrhea. He had a significant medical history including diabetes, hypertension, prior coronary artery stenting, morbid obesity (with past gastric bypass surgery), longstanding ventral hernia, and back pain. A CT scan revealed multiple hernias and a potential closed-loop bowel obstruction, leading to a surgery consultation. Our client, an emergency general surgeon, interpreted that the patient did not have a closed loop or any significant obstruction and recommended non-surgical management. The patient was approved to have clear liquids, and had a vomiting incident shortly after, but our client was not notified. The patient was returned to NPO status, and after improving overnight, he was returned to “clears” and additional medical and renal consults were ordered. Our client did not receive any communications from the residents/nurses of any changes in the patient’s condition. On February 18, 2019, two rapid responses were called due to increased heart rate and vomiting. It is believed that the vomiting resulted in aspiration, causing sepsis, ultimately leading to the patient’s death. During the trial, the plaintiff’s sole medical expert highlighted imaging on the wrong hernia, which called into question all of his opinions in the case. We made key objections related to the expert testimony, limiting what the allegations were, and preventing new allegations from being made. After approximately two and a half hours of deliberating, the jury returned a no-cause verdict.
Unanimous Verdict Obtained in a Medical Malpractice Matter in Bergen County, New Jersey
