Author: National Law Forum

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OSHA Expands Criteria for Severe Violator Enforcement Program

In an announcement that expands the criteria for entry into the Occupational Safety and Health Administration’s (OSHA) Severe Violator Enforcement Program, OSHA has signaled that it is making enforcement a priority and that employers with willful, repeat, and failure-to-abate violations will be subject to significant consequences.

Key Takeaways

  • On September 15, 2022, OSHA announced that it was expanding its criteria for entering employers into its Severe Violator Enforcement Program (“SVEP”). The updated SVEP directive is available here.
  • Previously, entry into the program was limited to cases involving fatalities, three or more hospitalizations, high-emphasis hazards, the potential release of a highly hazardous chemical, and enforcement actions classified as egregious.
  • Now, an employer can be entered into the program in cases involving two or more willful, repeat, or failure-to-abate violations, regardless of the hazard involved. They will continue to be subject to entry in the program in certain cases involving fatalities, three or more hospitalizations, and enforcement actions classified as egregious.
  • In light of this expansion, employers should review their compliance records and current health and safety practices and consider whether further actions are needed to mitigate enforcement risks.

Background

In 2010, OSHA created the Severe Violator Enforcement Program to “concentrate[] resources on inspecting employers who have demonstrated indifference to their OSH Act obligations by willful, repeated, or failure-to-abate violations.” Under the original SVEP, OSHA would designate employers as “severe violators” if they were involved in an enforcement action:

  • Involving a fatality in which OSHA found one or more willful, repeat, or failure-to-abate violations;
  • Involving a catastrophe (three or more hospitalizations) in which OSHA found one or more willful, repeat, or failure-to-abate violations;
  • Involving a high-emphasis hazard in which OSHA found two or more high-gravity willful, repeat, or failure-to-abate violations;
  • Involving the potential release of a highly hazardous chemical in which OSHA found three or more high-gravity willful, repeat, or failure-to-abate violations; or
  • Classified by OSHA as “egregious.”

Employers entered into the SVEP were subject to consequences that included mandatory enhanced follow-up inspections, a nationwide inspection of related workplaces, negative publicity, enhanced settlement provisions, and the potential for federal court enforcement under Section 11(b) of the OSH Act.

Updated Criteria

Under the new criteria, employers will continue to be entered into the SVEP in enforcement actions involving a fatality or catastrophe in which OSHA found one or more willful, repeat, or failure-to-abate-violations and in enforcement actions classified as egregious.

In a departure from the original criteria, cases involving two or more high-gravity willful, repeat, or failure-to-abate violations will also be entered into the SVEP, regardless of whether they are linked to a certain hazard or standard. As a result of this change, OSHA expects that more employers will be entered into the SVEP.

Other Key Changes

In addition to expanding the criteria for entry into the SVEP, OSHA made key changes regarding follow-up inspections and removal from the SVEP.

  • Follow-up OSHA inspections must occur within one year, but not longer than two years after the final order. Previously, there was no required timeframe for conducting follow-up inspections.
  • Eligibility for removal will begin three years after the date an employer completes abatement. Previously, that period began running on the final order date.
  • If an employer implements an enhanced settlement agreement that includes the use of a safety and health management system that follows OSHA’s Recommended Practices for Safety and Health Programs, the employer can be eligible for removal after two years.

Implications

These changes signify that OSHA is prioritizing enforcement and intends to impose significant consequences on employers that repeatedly and/or willfully violate OSHA requirements. Employers should review their compliance records and current health and safety practices and evaluate whether additional action is needed to mitigate the risk for willful, repeat, or failure-to-abate violations and entry into the SVEP.

Article By Jayni A. Lanham and Mark N. Duvall of Beveridge & Diamond PC

For more labor and employment legal news, click here to visit the National Law Review.

© 2022 Beveridge & Diamond PC

CFPB Plans to Increase Regulation over “Buy Now, Pay Later” Lenders

The Consumer Financial Protect Bureau (CFPB) issued a release on September 15, 2022, announcing its intent to issue additional interpretive guidance or rules to ensure “Buy Now, Pay Later” (BNPL) lenders comply with the same or similar regulations already established for credit cards following a study on the industry.

In its press release, the CFPB Director Rohit Chopra noted the rapidly growing use of “Buy Now, Pay Later is a rapidly growing type of loan that serves as a close substitute for credit cards.” While credit cards include interest charges, BNPL loans do not, making them more attractive to consumers. Instead, these loans allow consumers to purchase a product and repay the purchase price through several installment payments. As a result, BNPL loans have become prominent over the past several years, particularly during the COVID-19 pandemic. These previously niche loans, typically used for apparel and beauty purchases, are now used in almost all consumer-facing industries.

The CFPB noted several highlights of BNPL loans found through the study, which include:

  • Increased loan approval rates year over year;
  • Increased occurrences of late fee charges;
  • Increased product returns by consumers; and
  • Shrinking profit margins by BNPL lenders.

As a result of the study, the CFPB outlined the following concerns with the BNPL industry, mainly because the marketing of these loans leads consumers to believe the loans are a “zero-risk credit option.”

  • Limited Consumer Protections: While BNPL loans are used as an alternative to credit cards, they lack the standard credit disclosures, dispute resolution rights, etc., that similar consumer credit transactions often require.
  • Data Harvesting: Lower profit margins associated with BNPL loans have pushed the industry to monetize consumer data, potentially impacting consumer privacy.
  • Debt Accumulation: According to the CFPB, BNPL loans encourage consumers to purchase more products and borrow more, resulting in consumers becoming overleveraged. While the CFPB notes that the lenders in this space do not furnish credit data to credit reporting companies, the CFPB is concerned about this industry extending credit to consumers who may not be able to repay the debt.

Takeaways

The CFPB has yet again reinforced its commitment to regulate lenders that extend consumer credit. The CFPB’s decision to either enforce existing consumer laws (i.e., the Truth in Lending Act disclosures already required for credit cards and other consumer loans) or create new rules on the growing BNPL industry is not unexpected. However, the CFPB’s release shows a renewed focus on protecting consumers’ privacy rights and ensuring that consumers can afford to repay their credit lines before offers of credit are extended, and demonstrates once more that the Bureau will seek to regulate emerging forms of consumer credit.

Article By David T. Long Jr. and Andrew J. Narod of Bradley Arant Boult Cummings LLP

For more financial institutions and banking legal news, click here to visit the National Law Review.

© 2022 Bradley Arant Boult Cummings LLP

Name, Image and Likeness: What Higher Education Institutions Need to Know for Legal Compliance

More than a year has passed since the NCAA v. Alston ruling and roll-out of the NCAA Name, Image and Likeness Interim Policy. What processes should institutions have in place, and what situations should they be on the lookout for at this point in the NIL game? While institutions cannot provide compensation to student-athletes or potential student-athletes in exchange for use of a student’s NIL, below are items counsel at higher institutions should have on their radar.

Review and Approval of NIL Agreements

The NCAA Interim Policy does not require student-athletes to disclose NIL agreements and/or opportunities to their institutions. In the State of Michigan, however, pursuant to House Bill 5217, beginning December 31, 2022, student-athletes must disclose proposed NIL opportunities or agreements to the institution at least seven days prior to committing to the opportunity or contract. For the institution, this means there needs to be a process in place by which student-athletes submit opportunities or agreements to the institution and the institution does a timely and thorough review of the submission. The institutional representative reviewing the submissions must be knowledgeable of the institution’s active contractual obligations and only sign off on the student-athlete’s potential NIL opportunity or contract once confident there is no conflict with an existing institutional contract. This is most likely to come up in agreements with exclusivity terms, such as sports apparel and campus-wide pouring rights agreements. If there is a conflict, the institution needs to articulate the specific conflict to the student-athlete so they can negotiate a revision, which is then subject to additional review and potential approval by the institution.

Institutions are the Regulating Bodies

Institutions in states that require submission of NIL opportunities by student-athletes need to pay close attention when reviewing submissions because the NCAA has placed most of the NIL regulatory burden on institutions. Specifically, institutions are obligated to report potential violations of NCAA policy. Among other potential violations, institutions must report possible abuses on the prohibition of pay-for-play and improper inducements of potential student-athletes and current student-athletes. Essentially, in addition to spotting potential conflicts between NIL agreements and current institution agreements, institutions need to review NIL agreements to determine if a student-athlete is being compensated for athletic achievement and/or for their enrollment or continued enrollment at a particular institution. Any indication that the student-athlete’s NIL agreement will be void if they no longer participate on an athletic team requires the institution to complete due diligence and determine the appropriateness of the arrangement in light of the NIL policy. Institutions are ultimately responsible for certifying the eligibility of student-athletes, and the presence of the previously mentioned terms place the agreement in direct violation of the language in the NIL Interim Policy and corresponding NCAA guidance.

Institutional Staff Members

It is in the best interest of institutions to train their staff members on appropriate interactions with boosters because the NCAA holds institutions responsible for the “impermissible recruiting activities engaged in by a representative of athletics interest (i.e., a booster).” Staff members need to understand the actions they are permitted to take and conversations they are permitted to have, as failure to do so could land them deep in the gray area of NIL.

  • An institutional staff member cannot directly or indirectly communicate with a potential student-athlete on behalf of a booster or NIL entity.
  • An institutional staff member cannot enter into agreements with an NIL entity to secure NIL deals between the entity and potential student-athletes.
  • An institutional staff member cannot “organize, facilitate or arrange” a meeting or any conversations between an NIL entity and a potential student-athlete, which includes transfer students coming from other institutions.

Financial Aid

Institutions should ensure they are not influencing how a student-athlete uses their compensation. Specifically, institutions should not direct student-athletes to use their NIL compensation for financial aid. Student-athletes’ financial aid is not impacted by compensation they would receive from NIL agreements. Financial aid limitations exclude compensation which also extends to NIL compensation. However, if a student receives NIL compensation, this may impact need-based financial aid.

FERPA

Many public institutions have made the argument that FERPA precludes them from disclosing NIL agreements without a release executed by the student-athlete. If a copy of an NIL agreement or summary of an NIL opportunity is provided to the institution by the student-athlete, this becomes a record of the university per the definition of FERPA and is likely part of the student-athlete’s educational record. There may be a particular circumstance in which a FERPA exception would apply to a request, but there is no broad FERPA exception that would apply in this situation. Institutions might find it strategic to include their stance on FERPA in an NIL policy to ensure all requests for NIL agreements are handled consistently.

International Students

International students can receive NIL compensation but with some caveats. In its documentation, the NCAA directs international student-athletes to their institution’s Designated School Official for “guidance related to maintaining their immigration status and tax implications.” As a result, institutions should make sure the individual(s) is/are well equipped to provide answers regarding NIL from international students.

Five Steps to Become a Well-Organized and Compliant Institution

  1. Have an NIL policy and procedures that are followed consistently and made available to student-athletes for reference and consultation;
  2. Have a process in place to review NIL agreements between the institution’s student-athletes and outside entities or individuals (if located in a state that requires student-athletes to make such disclosures);
  3. Have trained its staff (especially athletics staff) on what actions can and cannot be taken in relation to student-athletes’ NIL opportunities;
  4. Have trained its student-athletes on available resources; and
  5. Have a team of institutional staff members ready to pivot if additional laws are enacted by their state, if additional guidance is provided by the NCAA or if federal legislation is enacted.

Article By Richard T. Hewlett and Jessica E. Visser of Varnum LLP

For more entertainment, art, and sports legal news, click here to visit the National Law Review.

© 2022 Varnum LLP

OCR Announces $300,000 Settlement Related to Improper Disposal of Physical PHI

On August 23, 2022, the U.S. Department of Health & Human Services, Office for Civil Rights (“HHS”) announced that it had settled a case involving the disposal of physical protected health information (“PHI”).

OCR alleged that, on March 31, 2021, a specimen containing PHI was found by a third-party security guard in the parking lot of the New England Dermatology and Laser Center (“NEDLC”). The PHI included patient name, patient date of birth, date of sample collection, and the name of the provider who took the specimen, in violation of the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”).

As part of the settlement, NEDLC agreed to pay HHS $300,640. According to NEDLC’s Resolution Agreement and the Corrective Action Plan, there were two potential violations by NEDLC. First, NEDLC allegedly failed to maintain appropriate safeguards to protect the privacy of PHI,” as required by 45 C.F.R. § 164.530(c). Second, NEDLC allegedly permitted the impermissible disclosure of PHI, in violation of Rule 45 C.F.R. § 164.502(a). The Corrective Action Plan requires NEDLC to develop, maintain and appropriately revise written policies and procedures in accordance with HIPAA.

Several highlights of the settlement include:

  1. Changes to Policies and Procedures. NEDLC must develop, maintain and revise, as necessary, its written HIPAA policies and procedures, and provide such policies and procedures to HHS for review and approval. NEDLC also must assess, update and revise, as necessary, such policies and procedures at least annually, or as needed, and seek HHS’s approval of the revised policies and procedures.
  2. Designation of Privacy Official. NEDLC must designate a privacy official who is responsible for the development and implementation of NEDLC’s HIPAA policies and procedures, and a contact person or office who is responsible for receiving relevant complaints.
  3. Training Requirements. NEDLC must provide HHS with training materials for its workforce members and seek HHS’s approval of such training materials. NEDLC must also distribute the HIPAA policies and procedures to its workforce members and relevant business associates, and obtain a written compliance certification from all such individuals. NEDLC must provide HIPAA training for new workforce members, and all workforce members at least every 12 months. Each workforce member must certify, in electronic or written form, that they received training. NEDLC must review the training at least annually, and update the training where appropriate. NEDLC must promptly investigate, review, report to HHS, and sanction any workforce member that does not comply with its HIPAA policies and procedures.
  4. Implementation Report and Annual Report.  NEDLC is required to submit to HHS a written report summarizing the status of its implementation of the requirements provided set forth in the settlement, and annual compliance reports.

For more Health Care legal news, click here to visit the National Law Review.

Copyright © 2022, Hunton Andrews Kurth LLP. All Rights Reserved.

In One Day, California Governor Signs Into Law Ten Cannabis Bills, Including Authorization for Interstate Commerce

Acting in one fell swoop, on September 18, 2022, California Governor Gavin Newsom signed 10 cannabis-related legislative bills into law. These bills, which touch on issues that run the gamut of the cannabis industry, are intended to “strengthen California’s cannabis laws, expand the legal cannabis market and redress the harms of cannabis prohibition.” Senate Bill 1326 is the most widely recognized bill of the group, and authorizes the Governor the power to sign cannabis trade agreements with other states where cannabis is legal. Other bills address employment protection, labelling, use of cannabis in veterinary medicine and taxation. In his press release, Governor Newsom said: “For too many Californians, the promise of cannabis legalization remains out of reach. These measures build on the important strides our state has made toward this goal, but much work remains to build an equitable, safe and sustainable legal cannabis industry.”

Still before Governor Newsom for his signature is SB 1496, which would implement a series of changes to the state’s cannabis tax policy, including authorizing regulators to extend the deadline for tax payments by cannabis businesses located in areas affected by an emergency proclamation by the Governor.

Below is a discussion of the cannabis-centric Senate and Assembly bills adopted during the 2022 Legislative session.

SB 1326 – Cannabis: Interstate Agreements

SB 1326 adds Chapter 25 to the Business and Professions Code and allows for interstate cannabis commerce from California to and from other states that recognize the legality of cannabis cultivation, production, distribution and/or possession. While seemingly revolutionary, SB 1326 is contingent on an official assurance that the activity would not result in federal enforcement action against California – meaning, most likely, that this bill cannot be utilized until cannabis is federally decriminalized.

Historically, California is an industry leader in product quality and innovation, and this bill, according to SB 1326’s author, Senator Anna Caballero, “provides a relief valve for the oversupply of cannabis, an opportunity to grow California’s brand and market share, support job creation, and gives the state a competitive advantage as federal policy develops…SB 1326 is an essential step to ensure that California can fully capitalize on, and remain a leader in, the forthcoming national cannabis market. Furthermore, SB 1326 would allow California to use its own labor, environmental, and product quality standards be adopted in other states.”

SB 1186– Medicinal Cannabis Patients’ Right of Access Act

SB 1186 prohibits a local jurisdiction from adopting or enforcing any regulation that prohibits the delivery of a medicinal cannabis retail sale to medicinal cannabis patients or their primary caregivers by medicinal cannabis businesses, or that has the effect of prohibiting such delivery. The bill’s author, Senator Scott Weiner, states this bill is a victory for seniors living with chronic illness, and will both improve patient access and help fill voids throughout the state where no cannabis license types have been authorized.

AB 1646 – Cannabis Packaging: Beverages.

AB 1646 authorizes cannabis beverages to be packaged in containers of any material that are clear or any color.

AB 1706 – Cannabis Crimes: Resentencing.

If an eligible cannabis conviction was not challenged by July 1, 2020, AB 1706 requires the California court system to process record sealing and other forms of relief for such convictions by March 1, 2023. AB 1706 also requires the Department of Justice to complete an update of the State’s summary criminal history information database, and ensure that inaccurate state summary criminal history is not reported. The Department of Justice is also required to conduct an awareness campaign so that individuals that may be impacted by this process become aware of methods to verify updates to their criminal history. The bill would make a conviction, arrest, or other proceeding that has been sealed pursuant to these provisions deemed never to have occurred.

AB 1885 – Cannabis & Cannabis Products: Animals: Veterinary Medicine

AB 1885 expands the purpose of the comprehensive system established by Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA) to include the control and regulation of the cultivation, distribution, transport, storage, manufacturing, processing, and sale of cannabis products intended for use on, or consumption by, animals. The bill makes various related revisions to the definitions under MAUCRSA, would exclude livestock and food animals, as specified, from the definition of “animal,” for these purposes, and would specify that cannabis concentrate and edible cannabis products are not considered processed pet foods as defined under the Pure Pet Food Act of 1969.

AB 1885 would also prohibit the Veterinary Medical Board within the Department of Consumer Affairs from disciplining a veterinarian who recommends the use of cannabis on an animal for potential therapeutic effect or health supplementation purposes, unless the veterinarian is employed by or has an agreement with a cannabis licensee. Under this bill, the Veterinary Medical Board is required to adopt guidelines, by January 1, 2024, for veterinarians to follow when recommending cannabis within the veterinarian-client-patient relationship, and would require the Veterinary Medical Board to post the guidelines on its internet website.

Lastly, AB 1885 would require that cannabis products intended for animals comply with additional concentration and other standards adopted by regulation. These regulations must be promulgated no later than July 1, 2025, and would prohibit the marketing or sale of those products before the regulations take effect.

AB 1894 – Integrated Cannabis Vaporizer: Packaging, Labeling, Advertisement, & Marketing

AB 1894 requires the advertisement and marketing of a cannabis cartridge and an integrated cannabis vaporizer to prominently display a specified message to properly dispose of a cannabis cartridge and an integrated cannabis vaporizer as hazardous waste. This bill also prohibits the package, label, advertisement, and marketing from indicating that the cannabis cartridge or integrated cannabis vaporizer is disposable or implying that it may be thrown in the trash or recycling streams.

AB 2210 – Cannabis: State Temporary Event Licenses: Venues Licensed by the Department of Alcoholic Beverage Control: Unsold Inventory

AB 2210 prohibits Department of Cannabis Control (DCC) from denying an application for a state temporary event license solely on the basis that there is a license issued pursuant to the Alcoholic Beverage Control Act for the proposed premises of the event. It also prohibits the Department of Alcoholic Beverage Control from taking disciplinary action against a person licensed pursuant to the Alcoholic Beverage Control Act on the basis of a state temporary event license issued by the DCC to a licensee that utilizes the same premises.

AB 2210 requires all on- and off-sale privileges of alcoholic beverages at the venue to be suspended for the day of the event until 6 a.m. on the day after the event has ended, and would prohibit all alcohol consumption on the venue premises for the day of the event, until 6 a.m. on the day after the event has ended. All inventory of cannabis or cannabis products to be sold by a state temporary event license to be transported to and from the temporary event by a licensed distributor or licensed microbusiness. A state temporary event licensee, upon completion or cessation of the temporary event, is authorized to reconcile unsold inventory of cannabis or cannabis products and return it to the licensee’s retail premises.

AB 2188 – Discrimination in Employment: Use of Cannabis[1]

AB 2188 makes it unlawful for an employer to discriminate against a person in hiring, termination, or any term or condition of employment, or otherwise penalize a person” solely because of off-duty, off-site cannabis use. The bill will also eliminate employment-based THC testing, with exceptions for certain positions, such as federal employees or those working in the building and construction trades. AB 2188 does not preempt state or federal laws requiring applicants or employees to be tested for controlled substances as a condition of employment, receiving federal funding or federal licensing-related benefits, or entering into a federal contract.

AB 2568 – Cannabis: Insurance Providers.

AB 2568 provides it is not a crime for individuals and firms to provide insurance and related services to persons licensed to engage in commercial cannabis activity.

AB 2925 – California Cannabis Tax Fund: Spending Reports.

AB 2925 requires that the State Department of Health Care Services submit reports to the legislature, starting no later than July 10, 2023, that accounts for cannabis tax revenue that has been distributed to the Youth Education, Prevention, Early Intervention and Treatment Account, as required under MAUCRSA.

For more Biotech, Food, & Drug Law news, click here to visit the National Law Review.

FOOTNOTES

[1] AB 2188 is discussed in further detail here.

Copyright © 2022, Sheppard Mullin Richter & Hampton LLP.

September 2022 Legal Industry News and Updates: Law Firm Growth and Expansion, Industry Recognition, and Spotlights on Women in Law

Happy autumn from the National Law Review! As the seasons change, we hope you are having a safe and healthy year. Please read on for the latest news coverage in the legal field, including law firm hiring and expansion, industry awards and recognition, and continued updates on women in law.

In addition, please be sure to check out Episode 4 of the Legal News Reach podcast: “The Perfect Storm: Law Firm Marketing & Business Development Budgeting with Beth Cuzzone, Global Practice Leader of Intapp.”

Law Firm Hiring and Expansion

Shumaker, Loop & Kendrick, LLP has named two new attorneys to lead their growing Public Sector practice group: partner Andy Mayts will serve as the chair of the group, and partner Patrick Duggan will serve as co-chair. Mr. Matts focuses his practice on banking, finance, and construction-related litigation. He handles complex civil litigation for many clients, including large businesses, national banks, and other financial institutions. Mr. Duggan practices employment law and litigation in complex workplace public sector and business disputes, with a specific focus on the Americans with Disabilities Act, the Fair Labor Standards Act, and other prominent legislation.

“It will take unique thinking and creativity to help governmental and public entities meet the growing needs of our communities,” said Shumaker Management Committee Vice Chair Jennifer Compton. “Andy and Patrick are top-performers and ready to meet this demand. With their leadership, we are confident that Shumaker’s Public Sector Practice will have continued growth and success.”

Stephanie J. Blumstein has joined law firm A.Y. Strauss as a partner in the Franchise practice group. Ms. Blumstein has a great deal of franchise litigation experience, including matters related to breach of contract, trademark infringement, fraud claims, business competition, and lease negotiations. She has assisted prospective franchisees as well as veteran franchise owners on all types of issues. Ms. Blumstein was also recognized in the 2023 edition of The Best Lawyers in America.

“I am thrilled to welcome Stephanie to the team,” said Marisa Rauchway, chair of the firm’s Franchise Group. “As a veteran of the national franchise community, her broad legal talents and deep industry knowledge will add immediate value to both existing and future clients of our practice.”

Michael Best added Dan Forest, former Lieutenant Governor of North Carolina, as a senior advisor in the firm’s Raleigh office. Joining the Government Relations practice group, Mr. Forest assists Michael Best Strategies with developing a strong bipartisan team of professionals who are focused on serving clients with public affairs and government relations needs. In his former role as Lieutenant Governor, Mr. Forest also served as President of the North Carolina Senate, Chairman of the Energy Policy Council, and Chairman of the Digital Technology Committee as a member of the State Board of Education.

“We’re excited to add Dan to our leadership team in North Carolina,” said Andy Jones, North Carolina Managing Partner for Michael Best & Friedrich, LLP. “Dan’s record of service and deep network across the State will help us continue to build our entrepreneurial-minded team of professionals and round out our ability to provide full-service solutions to our clients.”

BakerHostetler added Lisa Houssiere as a member of the firm’s Litigation Practice Group and Energy Industry team in their Houston office.  Ms. Houssiere has extensive experience in international disputes and investigations, particularly in the energy sector, and has worked on several high-profile Foreign Corrupt Practices Act cases and advised clients under investigation by the U.S. Department of Justice, the Federal Bureau of Investigation, the Commodity Futures Trading Commission and the European Commission.

Commenting on Ms. Housssiere’s addition to the firm, W. Ray Whitman, chair of BakerHostetler’s national Litigation Practice Group, stated. “Her range of trial work, including complex energy, antitrust and intellectual property matters, brings additional depth to our internationally recognized litigation practice.”

Venable LLP expanded its Product Liability and Mass Torts team in the Chicago and Los Angeles with the addition of partner John Roberts (Chicago) and partner Karen Firstenberg (Los Angeles). Mr. Roberts assists clients in the areas of product liability, commercial litigation, insurance recovery, and regulatory compliance, with much experience serving as national litigation counsel for a variety of clients. Mrs. Firstenberg provides counsel to life sciences companies on compliance, toxic torts, and product liability, representing clients in all fields, including medical devices, materials science, biotech, and pharmaceuticals.

“We are thrilled to welcome John and Karen to Venable and to our product liability team. Their addition will not only diversify our practice, but further solidify our presence in Los Angeles and expand it to Chicago, a long-standing life sciences hub and the home of some of our most valued clients. John and Karen’s success in the courtroom also deepens our bench of proven products trial lawyers,” said Kathleen Hardway, a co-chair of Venable’s Product Liability and Mass Torts Group.

Industry Awards and Recognition

Steve Adamczyk, partner at Varnum LLP, has been named to the 2022 Gulfshore Business 40 Under 40. This magazine seeks to recognize young legal professionals in the Southwestern region of Florida who have aided the area through volunteer work and philanthropy. Mr. Adamczyk has served on the board of the Florida Southern Gulf Coast to Heartland Chapter of the American Red Cross since 2015. He has also supported local elected officials and long-term recovery efforts in the wake of Hurricane Irma.

Mr. Adamczyk has a great deal of experience in estate and trust planning services. At Varnum, he broadly focuses his practice on residential and commercial real estate transactions, as well as community association representation, providing counsel and assistance for condominium and homeowners associations across the state of Florida.

Katten Muchin Rosenman LLP was recognized at the 2022 HFM US Services Awards ceremony as the best onshore law firm for hedge fund client services in the United States. Recipients were chosen by a panel of leading hedge fund chief operating officers, as well as chief financial officers and general counsels. Wendy Cohen and Allison Yacker, co-chairs of the firm’s Investment Management and Funds practice, accepted the award on behalf of the firm.

Lance Zinman, Global Chairman of Katten‘s Financial Markets and Funds group, said the following of the award: “Receiving this distinction underscores what clients and others have told us they appreciate about Katten: That we provide excellent and sophisticated counsel in a business-savvy manner that takes into account the practical aspects of our clients’ business; that we analyze complex market and legal issues and close investments and transactions, navigating regulatory issues quickly and comprehensively; and that we quickly see the big picture, to name just some of what we hear.”

Lawmatics, a leading legal client relationship management platform, was named a “Hot Product” in the 2022 TechnoLawyer Buyer’s Guide. TechnoLawyer continues to report on the latest developments in legal technology and law office management; the publication cited Lawmatics’ versatile automation capabilities as a particularly significant feature that set the platform apart.

“We’re extremely proud to be identified as a premier tool for helping law firms grow,” said Matt Spiegel, CEO of Lawmatics. “Our software empowers law firms to spend less of their time on administering the business of their practice, and more time focusing on the clients they serve. We know that firms thrive when they can prioritize people rather than paperwork.”

Thomas F. Zych, co-chair of Thompson Hine’s Antitrust, Competition & Distribution and Emerging Technologies practices, and Privacy & Cybersecurity team, has been selected to chair the American Bar Association’s Antitrust Law Section, through August 2023.

Based in Cleveland, Mr. Zych has over 39 years of experience in a wide range of data protection, intellectual property, consumer protection, social media, competition and antitrust matters. He also represents a full range of business enterprises in their privacy and data security operations.

Los Angeles Business Journal’s 2022 “Most Admired Law Firms” list added Sidley, as one of the most distinguished and “best law firms to work for” in the Los Angeles area. The Los Angeles Business Journal’s list recognizes law firms who are working toward creating diverse, positive, and supportive professional environments.

Of note is the 2022 launch of Sidley’s “Built to Lead,” program designed to help the firm’s associates by equipping them with greater business acumen by partnering with top business schools and helping young lawyers grow their leadership capabilities by partnering with select nonprofit legal and community organizations.

Women in Law

Foley and Lardner Partner Natasha Allen has been recognized on The Recorder’s California Legal Awards “Women Leaders in Tech Law” list. A co-chair of Foley’s Venture Capital Committee and Innovative Technology Sector Artificial Intelligence Section, Ms. Allen guides domestic and international corporations through mergers, acquisitions, and divestitures, with a special focus on cybersecurity, software, and virtual reality firms.

The California Legal Awards celebrate legal innovators who are influential in the ongoing development of technological jurisprudence. Allen and her peers will be celebrated at an awards ceremony on November 3, 2022.

Paula Cozzi Goedert, a leading nonprofit attorney with Barnes and Thornburg specializing in tax, compliance, and strategy, has been recognized on Crain’s Chicago Business 2022 “Notable Women in Law” list. Crain’s annual list illustrates the power of women in law by showcasing leaders with compelling professional stories.

Ms. Goedert chairs Barnes and Thornburg’s Associations and Foundations Group and has served over 300 clients, including the National PTA, American College of Surgeons, American Library Association, and Bank Administration Institute. Goedert’s expertise was invaluable during the COVID-19 crisis, where she guided her clients through challenges including staff furloughs, endowment raids, and insurance claims.

Additionally, Perkins Coie Partners Gina LaMonica and Lucy Park, were included on the 2022 Chicago Business Notable Women in Law list, whose requirements include mentoring other women lawyers, promoting inclusive practices in the workplace, and assuming a leadership role in professional organizations and civic and community service initiatives.

Ms. LaMonica practices white-collar criminal defense and is regularly retained to conduct internal investigations involving employee misconduct, regulatory violations, financial fraud, and is co-chair of Perkins Coie’s Educational Institutions & Services industry group and a co-founder and current secretary of the Chicago chapter of the national Women’s White Collar Defense Association.

Ms. Park  a partner in Perkins Coie’s Trust & Estate Planning group, counsels high-net-worth individuals, families, and family-owned businesses on wealth preservation and transfer, charitable giving, and succession planning and is a member of the firm’s Executive Committee, Strategic Diversity Committee,  and co-chair of the firm’s Women’s Forum, a  resource group, which works to attract, retain, and promote and support the firm’s female lawyers.

Former White House Administrator Sharon McGowan is adding her anti-discrimination background to her new role as partner at nationally-recognized civil rights law firm Katz Banks Kumin. Ms. McGowan has previously worked as Chief Strategy Officer and Legal Director for the Lambda Legal Defense and Education Fund, staff attorney with the ACLU’s LGBT and AIDS projects, and lead attorney for seminal trans workplace antidiscrimination case Schroer v. Billington. During Obama’s administration, Ms. McGowan worked toward ending various forms of discrimination as Principal Deputy Chief at the U.S. Department of Justice’s Civil Rights Division and Acting General Counsel and Deputy General Counsel for Policy at the U.S. Office of Personnel Management.

“Sharon is a brilliant legal advocate who has played an unparalleled role in securing some of our nation’s greatest achievements in civil rights,” said firm Co-Founding Partner Lisa J. Banks. “Her unique perspective and wide range of counseling experience will be a tremendous asset to our clients in the areas of whistleblower law, employment law, sexual harassment law, and civil rights and civil liberties matters.”

Firm Co-Founding Partner Debra S. Katz added: “Sharon’s experience as one of President Obama’s top anti-discrimination attorneys, as well as her deep level of public policy and advocacy expertise, will be invaluable to our clients and the firm’s ongoing efforts to advance civil rights in the workplace.”

Article By Chandler Ford, Crissonna Tennison, and Jennifer Schaller of The National Law Review / The National Law Forum LLC

For more business of law legal news, click here to visit the National Law Review.

Copyright ©2022 National Law Forum, LLC

NLRB’s Proposed New Joint Employer Rule: What to Do Now to Manage the Risk

On September 7, 2022, the National Labor Relations Board (NLRB) issued a Notice of Proposed Rulemaking (NPRM) that would, if adopted, make it much easier for the NLRB to find a company to be a “joint employer” of persons directly employed by its contractors, vendors, suppliers and franchisees. The consequences of a joint employer finding are significant and can lead to: liability for unfair practices committed by the direct employer; a duty to bargain with a union representing the direct employer’s employees; exposure to liability for one’s own conduct that fails to take into account the indirect employer relationship and spread of a union from the direct employer’s employees to the indirect employer.

Joint-employer theory creates far more risk for employers than related doctrines such as single employer or alter ego because, unlike those theories, joint employer status does not require any common ownership or corporate control. Two companies operating entirely at arm’s length can be found joint employers.

The major proposed change relates to the degree of influence that an indirect employer must have to justify a finding of single employer status. Under the current NLRB standard, the indirect employer must actually exercise “immediate and direct” control over key terms of employment, normally limited to wages, benefits, hours and termination.

The proposed rule relaxes that standard in three key ways. First, it eliminates the actually exercise requirement and states that possession of even unused authority can be sufficient.

Second, it does away with the immediate and direct requirement so that influence exercised by the indirect employer through the direct employer can be used to support a finding.

Third, it expands, beyond the list enumerated in the current rule, the types of employment terms control of which will justify a finding of joint employer status. The Obama Board had adopted the currently proposed standard by an NLRB decision, Browning-Ferris Inds. 362 NLRB No. 186 (2015). However, that decision was overturned by the Trump Board’s adoption of the current rule, 85 FR 11184, codified at 29 CFR 103.40, (Feb. 26, 2020). The proposed rule seeks to reinstate Browning-Ferrisas the governing law.

Because Browning-Ferrisand the NPRM endorse pre-1984 NLRB decisions regarding joint employer status, those decisions provide guidance for how the new rule may be enforced. The NLRB and courts frequently relied on what authority was given to the alleged indirect employer in its agreement with the contractor or vendor. Clauses that required or allowed the indirect employer to approve hirings, terminations or wage adjustments to contractor employees usually resulted in finding joint employer status. In addition, cost-plus arrangements, particularly those that were terminable on short notice were often found to support a joint employer finding. Finally, clauses allowing the indirect employer to set work schedules, production rates, or requiring contractor employees to abide by the indirect employer’s work rules and other policies governing conduct also were found supportive of joint employer status.

The proposed rule is still subject to comment and revision, but it is likely to be adopted without significant change. The comment and review period, which closes on November 21, 2022, provides a window in which savvy employers can assess the risks to their organization when the Rule goes into effect. A key step is to examine existing contractual relationships with vendors to identify and modify those terms that may potentially support joint employer status, or, if modification is untenable, to manage the risk through indemnity agreements with the vendor.

Article By Ahmad Chehab and Robert T. Zielinski of Miller Canfield
© 2022 Miller, Canfield, Paddock and Stone PLC

Ethylene Oxide Verdict First of Its Kind, and It’s Eye Opening!

Our prior reports discussed when an ethylene oxide case would go to verdict, and what the ensuing result would look like.  We no longer need to speculate.  On September 19, 2022, a Cook County (Illinois) jury awarded $363 million to a plaintiff who alleged that she developed breast cancer as a result of ethylene oxide emissions from the Sterigenics Willowbrook plant.  This was the first ethylene oxide personal injury case to go to trial, but there are hundreds of cases behind it waiting their turn.

Trial

After a five week trial in the Circuit Court of Cook County, Illinois, Law Division (Sue Kamuda v. Sterigenics et al, case number 2018-L-010475), the jury returned a verdict in the amount of $363 million.  Plaintiff had requested $21 million in compensatory damages and $325 million in punitive damages.

Plaintiff Kamuda argued that the ethylene oxide utilized at the Willowbrook plant, opened in 1984 and used primarily to sterilize medical equipment, caused serious cancer and reproductive health risks. Kamuda alleged that the company failed to analyze how long the chemical would stay in the air in the Willowbrook community or the distance it would travel. Further, Kamuda argued that Sterigenics recklessly failed to install emission controls decades earlier to reduce releases of the chemical.

For its part, Sterigenics argued that plaintiff Kamuda’s reliance on risk assessment and regulatory studies inaccurately led to her assertion that her breast cancer resulted in part from the plant’s ethylene oxide emissions.

Notably, the facility was closed a few years ago after the state of Illinois issued a seal order in February 2019 directing that ethylene oxide emissions had to be reduced significantly. Ultimately, the company decided to keep the facility closed.

Analysis

With this very large jury verdict, plaintiff firms will surely be pushing to get their ethylene oxide cases to trial, or, at a minimum, leverage steep pre-trial settlements.  Further, plaintiff firms will surely recruit new plaintiffs who allege some type of cancer as a result of residing in the vicinity of an ethylene oxide plant.

The next ethylene oxide case to go trial is scheduled for two weeks from now in the same court, though with different plaintiff counsel and judge, as well as a different alleged disease (leukemia).

We note that it remains to be seen whether the Kamuda verdict will be appealed. It also remains to be seen whether this verdict is aberrational or is a bellwether for future trials. Will juries return verdicts based on one type of cancer but not for another?  We will continue to report as these ethylene oxide trials go to verdict and analyze the ramifications.

Article By David A. Goldman of CMBG3 Law

For more environmental, energy, and resources legal news, click here to visit the National Law Review.

©2022 CMBG3 Law, LLC. All rights reserved.

Reinventing the American Road Trip: What the Inflation Reduction Act Means for Electric Vehicle Infrastructure

The Inflation Reduction Act of 2022 (“IRA”) signifies a turning point in domestic efforts to tackle climate change. Within the multibillion-dollar package are robust investments in climate mitigation initiatives, such as production tax credits, investment tax credits for battery and solar cell manufacturers, tax credits for new and used electric vehicles (“EV”)1, automaker facility transition grants, and additional financing for the construction of new electric vehicle manufacturing facilities.2 One thing is abundantly clear, the IRA’s focus on stimulating domestic production of electric vehicles means that the marketplace for electric vehicles will see a dramatic change. The Biden Administration has set an ambitious target of 50% of EV sale shares in the U.S. by 2030. However, if electric vehicles are going to achieve mass market adoption, a central question remains — where is the infrastructure to support them?

Addressing gaps in EV Supply and EV Infrastructure

As it stands, the shortage of charging infrastructure is a substantial barrier in the push for mass consumer adoption of EVs.3 Experts estimate that in order to meet the Biden Administration’s EV sale target by 2030, America would require 1.2 million public EV chargers and 28 million private EV chargers by that year.4 Department of Energy data shows that approximately 50,000 EV public charging sites are currently operational in the United States.5 In comparison, gasoline fueling stations total more than 145,000.6 However, federal legislation such as the Bipartisan Infrastructure Law (“BIL”) passed earlier this year signifies a clear commitment to remedying this disparity. The BIL establishes a National Electric Vehicle Infrastructure Formula Program (“NEVI”) to provide funding to States and private entities to deploy EV-charging infrastructure and to establish an interconnected network to facilitate “data collection, access and reliability.”7 The Federal Highway Administration, the federal agency charged with implementing NEVI, proposed minimum standards and requirements that states must meet to spend NEVI funds:

  • Installation, operation and maintenance by qualified technicians of EV infrastructure

  • Interoperability of EV charging infrastructure

  • Network connectivity of EV charging infrastructure

  • Data collection pertaining to pricing, real-time availability and accessibility8

The goal of the proposed rule is to secure EV charging infrastructure that works seamlessly for industrial, commercial and consumer drivers. Combining the historic investments in clean energy and climate infrastructure in the BIL and IRA, the federal government has jumpstarted what will be a fundamental shift in how consumers use transportation. Earlier this week, the Biden Administration announced more than two-thirds of EV Infrastructure Deployment Plans from States, the District of Columbia and Puerto Rico have been approved ahead of schedule under NEVI.9 With this early approval, these states can now unlock more than $900 million in NEVI funding from FY22 and FY23 to help build EV chargers across highways throughout the country.10

Section 13404’s Alternative Fuel Refueling Property Credit

Building up the U.S. capacity to build EVs, and then ensuring people can use said vehicles more easily by shoring up EV infrastructure is a crucial facet of the Inflation Reduction Act. Section 13404 of the IRA provides an Alternative Fuel Refueling Property Credit that targets the accelerated installation of EV charging infrastructure and assets.11 Section 13404 extends existing alternative fuel vehicle refueling property credit through 2032, and significantly restructures the credit by allowing taxpayers to claim a base credit of 6% for expenses up to $100,000 (for each piece refueling property located at a given facility) so long as the property is placed in service before Jan. 1, 2033.12 However, the alternative fuel property must be manufactured for use on public streets, roads and highways, but only if they are (1) intended for general public use, or (2) intended for exclusive use by government or commercial vehicles and (3) must be located in a qualifying census tract (i.e., low-income communities or non-urban areas).13 From a job creation standpoint, the IRA also provides an alternative bonus credit for taxpayers that meet certain wage requirements during the construction phase.14

The Future of EV Infrastructure

EV stations in city streets, parking garages and gas stations will become a prominent part of the nation’s infrastructure as it moves towards a green future. The effort will require coordination among municipal, state and federal policymakers. Even more, electric utilities must ensure that local infrastructure can support the additional strain on the grid. Utilities also have a direct interest in a cleaner, efficient, and less overburdened grid. Federal tax incentives, like the IRA, and subsides from states and local ordinances are integral to the implementation and construction of these networks. The private sector has already taken steps to do its part. In a recent study conducted by consulting company AlixPartners, as of June 2022, automakers and suppliers expect to invest at least $526 billion to fund the transition from gasoline powered vehicles to EVs through 2026.15 This is double the five-year EV investment forecast of $234 billion from 2020-2024.16 Even more, according to Bloomberg, not including deals that have disclosed financials, more than $4.8 billion has already been invested in the EV charging industry this year in the form of debt financing and acquisitions.17 Driven by fast growth and robust availability of government funds, financiers and large companies seeking to acquire EV charging companies, sense immense opportunity.18

FOOTNOTES

1“Electric Vehicle” is used interchangeably with the acronym “EV” throughout this article.

2 Isaacs-Thomas, I. (2022, August 11). What the Inflation Reduction act does for green energy. PBS. https://www.pbs.org/newshour/science/what-the-inflation-reduction-act-do…

3 Consumer Reports (2022, April). Breakthrough Energy: A Nationally Representative Multi-Mode Survey. https://article.images.consumerreports.org/prod/content/dam/surveys/Cons…

4 Kampshoff, P., Kumar, A., Peloquin, S., & Sahdev, S. (2022, August 31). Building the electric-vehicle charging infrastructure America needs. McKinsey & Company. https://www.mckinsey.com/industries/public-and-social-sector/our-insight…

5 U.S Department of Energy. (2022). Alternative Fueling Station Locator. Alternative Fuels Data Center: Alternative Fueling Station Locator. https://afdc.energy.gov/stations/#/find/nearest?fuel=ELEC&ev_levels=all&…

6 American Petroleum Institute. (n.d.). Service station FAQs. Energy API. https://www.api.org/oil-and-natural-gas/consumer-information/consumer-re…

7 U.S. Department of Transportation/Federal Highway Administration. (n.d.). Bipartisan Infrastructure Law – National Electric Vehicle Infrastructure (NEVI) formula program fact sheet: Federal Highway Administration. U.S. Department of Transportation/Federal Highway Administration. https://www.fhwa.dot.gov/bipartisan-infrastructure-law/nevi_formula_prog…

8 The Office of the Federal Register of the National Archives and Records Administration and the U.S. Government Publishing Office. (2022, June 22). National Electric Vehicle Infrastructure Formula Program. Federal Register. https://www.federalregister.gov/documents/2022/06/22/2022-12704/national…

9 United States Department of Transportation. (2022, September 14). Biden-Harris Administration announces approval of First 35 state plans to build out EV charging infrastructure across 53,000 miles of Highways. United States Department of Transportation. https://highways.dot.gov/newsroom/biden-harris-administration-announces-…

10 See Id.

11 As a note, “refueling property” is property used for the storage or dispensing of clean-burning fuel or electricity into the vehicle fuel tank or battery.  Clean-burning fuels include CNG, LNG, electricity, and hydrogen.

12 Inflation Reduction Act of 2022, H.R. 5376, 117th Cong. § 13404 (2022); See also Wells Hall III, C., Holloway, M. D., Wagner, T., & Baldwin, E. (2022, August 10). Nelson Mullins tax report–Senate passes Inflation Reduction Act. Nelson Mullins Riley & Scarborough LLP. https://www.nelsonmullins.com/idea_exchange/alerts/additional_nelson_mul…

13  Id.

14  Id.

15 AlixPartners, LLP. (2022, June 22). 2022 Alixpartners global automotive outlook. AlixPartners. https://www.alixpartners.com/media-center/press-releases/2022-alixpartne… See also Lienert, P. (2022, June 22). Electric vehicles could take 33% of global sales by 2028. Reuters. https://www.reuters.com/business/autos-transportation/electric-vehicles-…

16 Id.

17 Fisher, R. (2022, August 16). Electric car-charging investment soars driven by EV Growth, government funds. Bloomberg. https://www.bloomberg.com/news/articles/2022-08-16/car-charging-investme…

18 Id.

Article By Lawrence L. Ostema and Jeffrey E. Joseph of Nelson Mullins

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Copyright ©2022 Nelson Mullins Riley & Scarborough LLP

911 Network Reliability Deadline Approaching

Earlier this month, the FCC announced that its 2022 911 Reliability Certification System is now open for Covered 911 Service Providers to file annual reliability certifications.  The filings are due on October 17, 2022.  Failure to submit the certification may result in FCC enforcement action.

Background

In 2013, the FCC adopted rules aimed at improving the reliability and redundancy of the nation’s 911 network.  Those rules require Covered 911 Service Providers (“C9SP”) to take steps that promote reliable 911 service with respect to three network elements: circuit auditing, central-office backup power, and diverse network monitoring.  The Commission identified these three network elements as vulnerabilities following a derecho storm in 2012 that significantly impacted 911 service along the eastern seaboard.

Applicability. The rules apply to all C9SPs, which are defined as any entity that provides 911, E911, or NG911 capabilities such as call routing, automatic location information (ALI), automatic number identification (ANI), or the functional equivalent of those capabilities, directly to a public safety answering point (PSAP).

Certification. The rules require C9SPs to certify annually that they have met the FCC’s safe harbor provisions for each of these elements or have taken reasonable alternative measures in lieu of those safe harbor protections.  The certification must be made under penalty of perjury by a corporate officer with supervisory and budgetary authority over network operations.

In 2018 and 2020, the FCC sought comment on changes to the 911 reliability certification rules, but the rules have not yet been updated as a result of those proceedings.

Enforcement Against Noncompliant Providers

Last year, the FCC entered into eight consent decrees with Covered 911 Service Providers that failed to submit their reliability certifications in 2019, 2020, or both.  A Consent Decree typically requires the recipient to admit it violated an FCC rule, pay a fine to the federal government, and implement a Compliance Plan to guard against future rule violations.  These Compliance Plans required the C9SPs to designate a compliance officer, establish new operating procedures, and develop and distribute a compliance manual to all employees.

Additionally, the providers were required to establish and implement a compliance training program, file periodic compliance reports with the FCC detailing the steps the provider has taken to comply with the 911 rules, and report any noncompliance with 911 rules within 15 days of discovering such noncompliance.

Looking Forward

C9SPs have about one month to confirm compliance with the reliability rules and submit a required certification.  Based on the FCC’s enforcement efforts last year, C9SPs would be well-advised to work diligently to meet this upcoming deadline.

Article By Wesley K. Wright and Liam Fulling of Keller and Heckman LLP.

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© 2022 Keller and Heckman LLP