The National Law Forum

Texas Judge Not Persuaded, Permanently Enjoins DOL’s New Reporting Rule

In a major victory for the business community, Judge Sam R. Cummings of the U. S. District Court for the Northern District of Texas issued a permanent nationwide injunction blocking the Department of Labor (DOL) from enforcing its new “persuader” rule. National Federation of Independent Business, et al. v. Perez, et al., Case No. 5:16-cv-00066. The rule attempted to expand disclosure requirements by employers and their consultants (including attorneys) related to union-organizing campaigns.

The new rule, which Judge Cummings had preliminarily enjoined prior to its effective date of July 1 of this year, would have greatly increased the reporting requirements under Section 203 of the Labor Management and Reporting Disclosure Act. That section requires employers and their labor relations consultants to disclose the terms (including financial terms) of any arrangement by which the consultant provides services that are intended to directly or indirectly persuade employees concerning their rights to organize a union or to bargain collectively with their employer.

For years, the DOL took the position that no reporting was required unless the consultant had direct contact with employees by way of in-person meetings, telephone calls, letters, or emails. Similarly, no reporting was required if the consultant’s activities were limited to providing sample materials such as speeches, postings, letters to employees, and the like that the employer was free to accept, reject, or modify.

However, the new persuader rule expanded the disclosure requirements to include indirect contact with employees by the consultant, including:

Directing, planning, or coordinating the efforts of managers to persuade employees
Providing materials such as speeches, letters, or postings that are intended to persuade employees
Conducting union avoidance seminars if the consultant assists the employer in developing anti-union strategies
Developing personnel policies intended to persuade employees in the exercise of their organizational or collective bargaining rights.

The attorneys general for 10 states as well as various business groups challenged the new rule as infringing on employers’ First Amendment rights and conflicting with the attorney-client privilege. Judge Cummings agreed that the rule is unlawful and should be set aside. Presently, it is unknown if DOL intends to appeal Judge Cummings’ order.

ARTICLE BY Henry W. Sledz Jr. of Schiff Hardin LLP

The Unknown Future Of The Affordable Care Act

Donald Trump’s victory to become the next president of the United States, and the Republican Party’s continued control of the United States Senate and House, will likely have a significant impact on the future of the Affordable Care Act (ACA). President-elect Trump (Trump) has vowed to immediately dismantle the ACA. To date, Trump has provided only a broad outline of what exactly he plans to replace the law with, such as the following:

Eliminating ACA requirements which generally require (1) individuals to maintain health insurance, and (2) employers with more than 50 full time employees to offer affordable major medical plan coverage or run the risk of paying penalties;
Eliminating tax subsidies that eligible individuals can use to purchase coverage and/or offset costs under health insurance exchanges;
Expanding the use of health savings accounts to pay deductibles, copayments, etc.;
Establishing tax breaks to allow taxpayers to deduct premiums they pay for individual health insurance policies;
Allowing health insurance across state lines;
Allowing states to manage Medicaid funds;
Modifying or eliminating the ACA’s “essential health benefits” requirements;
Expanding age rating bands (increasing the range of premiums that will be allowed); and
“Modernizing” Medicare.

Despite his general opposition to the ACA, Trump has expressed support for ACA rules which prohibit insurers and employer plans from excluding coverage for expenses related to preexisting conditions. However, those prohibitions force insurance companies and employer plans to bear significant costs. The ACA’s employer and individual coverage mandates were intended to make the pre-existing condition exclusions more palatable to payers by forcing healthy individuals into the applicable insurance pools. Consequently, it is unclear how Trump would preserve the pre-existing condition exclusions yet eliminate the employer and individual mandates.

In addition, the ACA contains hundreds of provisions affecting hospitals, corporations, Medicare, health care quality and integrity, the health care workforce, biosimilars, health care prevention and other issues unrelated to what most people think of as “Obamacare.” To date, Trump appears not to have taken any public position on these provisions.

ARTICLE BY Molly R. Berkery, Todd M. Cleary, John E. Donahue, Thomas N. Shorter, Charles G. Vogel & Jed A. Roher of Godfrey & Kahn S.C.

Top Takeaways from FDA Draft Guidance on Software as Medical Device

FDA’s proposed adoption of an IMDRF document raises questions.

On October 14, the US Food and Drug Administration (FDA) released a new draft guidance document, Software as a Medical Device (SaMD): Clinical Evaluation (Draft Guidance).^[1] The Draft Guidance was developed by the SaMD Working Group of the International Medical Device Regulators Forum (IMDRF),^[2] a voluntary group of medical device regulators from around the world, including FDA. This is the first time that FDA has proposed issuing an IMDRF document as an official FDA guidance document.

The Draft Guidance discusses clinical evaluation recommendations for SaMD and focuses on the general principles of clinical evaluation, which include establishing scientific validity, clinical performance, and analytical validity for an SaMD. The Draft Guidance is available for public comment until December 13, 2016. We have highlighted below key takeaways.

1. Cart Before the Horse?

Over the years, FDA has issued several guidance documents attempting to clarify its position on software products. For instance, in 2015, the Agency issued its final guidance on Mobile Medical Applications, which describes when FDA will or will not actively regulate software that can be executed on a mobile platform.^[3] However, the Mobile Medical Apps guidance is limited to the specific mobile app examples listed in that guidance, and FDA has yet to issue its long-promised draft guidance on clinical decision support software. Thus, there is no clear overarching policy on when software used for health- or medical-related purposes would be considered SaMD, subject to FDA regulation. In this context, issuing guidance on FDA’s expectations for the clinical evaluation for SaMD seems premature. Software developers need to first understand where the proverbial line is before investing in clinical evaluation activities.

2. New Unadopted Terminology and Reference Documents Used

The Draft Guidance uses terminology defined in other IMDRF documents and also incorporates by reference findings from other IMDRF documents; however, FDA has not officially adopted those other IMDRF documents as FDA guidances. Thus, it is not clear whether FDA intends for this Draft Guidance to be the first volley, followed up by formally issuing other IMDRF documents on SaMD as FDA guidances, or whether FDA would simply consider the terminology and principles in those other IMDRF documents to be adopted by proxy if and when it finalizes this current Draft Guidance. It also is not clear how the principles and terminology in these other IMDRF documents align with FDA’s existing regulations and guidance documents. For instance, the Draft Guidance discusses a system of classifying SaMD based on its intended use and risk; however, it is not clear how this classification system would translate to FDA’s existing device classification system (Class I, Class II, and Class III) and classification regulations. Such an understanding is important for SaMD developers to determine the premarket review standard that will apply (e.g., establishing substantial equivalence vs. safety and effectiveness), because this will inform the goals for SaMD clinical evaluation.

3. Context Is Important

Although this Draft Guidance’s focus is SaMD clinical evaluation, a significant part of its 45 pages is used to provide definitions, general principles, context, and SaMD categorization principles (not to mention the references to other IMDRF documents, as described above). Only Section 6 directly addresses clinical evaluation. On that point, the new Draft Guidance describes clinical evaluation as the process for establishing the scientific validity, analytical validity, and clinical performance of an SaMD and provides recommendations for generating evidence in these three areas. The Draft Guidance further describes how to determine the required level of evidence based on the SaMD’s categorization. With regard to categorization, the Draft Guidance proposes a SaMD categorization scheme based on: (1) how the information generated by the SaMD will be used (for nondiagnostic, diagnostic, or therapeutic purposes), and (2) the criticality of the healthcare situation or condition in which the SaMD is to be used. An SaMD intended to treat or diagnose critical healthcare situations or conditions is considered higher risk and thus would be subject to more rigorous clinical evaluation requirements.

4. FDA Requests for Feedback

In its Federal Register notice announcing the new Draft Guidance, FDA highlighted specific areas for which it would like feedback, including the following:

Does the document appropriately translate and apply current clinical vocabulary for SaMD?
Are there other types of SaMD beyond those intended for nondiagnostic, diagnostic, and therapeutic purposes that should be highlighted or considered in the document?
Does the document adequately address the relevant clinical evaluation methods and processes for SaMD to generate clinical evidence?
Given the uniqueness of SaMD and the proposed framework, is there any impact on currently regulated devices or any possible adverse consequences?

Next Steps

The Draft Guidance document indicates that it is intended to provide globally harmonized principles of when and what type of clinical evaluation is appropriate based on the SaMD risk. However, questions remain about how these principles translate to FDA regulatory requirements.

The Guidance Document is available for comment until December 13, 2016 (Docket No. FDA–2016–D–2483).

ARTICLE BY Michele L. Buenafe & M. Elizabeth Bierman of Morgan, Lewis & Bockius LLP

^{[1] 81 Fed. Reg. 71105 (Oct. 14, 2016), https://www.gpo.gov/fdsys/pkg/FR-2016-10-14/pdf/2016-24805.pdf.}

^{[2] FDA,International Medical Device Regulators Forum (IMDRF) (last updated May 5, 2015), http://www.fda.gov/MedicalDevices/InternationalPrograms/IMDRF/default.htm.}

^{[3] FDA, Mobile Medical Applications: Guidance for Industry and Food and Drug Administration Staff, (Feb. 9, 2015), http://www.fda.gov/downloads/MedicalDevices/…/UCM263366.pdf.}

Cybersecurity Due Diligence Is Crucial in All M&A—Including Energy M&A Transactions

Can a single data breach kill or sideline a deal? Perhaps so. Last month Verizon signaled that Yahoo!’s disclosure of a 2014 cyberattack might be a “material” change to its July $4.83 billion takeover bid—which could lead Verizon to renegotiate or even drop the deal entirely. Concern over cybersecurity issues is not unique to technology or telecommunications combinations. In a 2016 NYSE Governance Services survey of public company directors and officers, only 26% of respondents would consider acquiring a company that recently suffered a high-profile data breach—while 85% of respondents claimed that it was “very” or “somewhat” likely that a major security vulnerability would affect a merger or acquisition under their watch (e.g., 52% said it would significantly lower valuation).

Bottom Line: Cybersecurity should play a more meaningful role in the due diligence portion of any potential M&A deal. Certainly this is so when a material portion of the value in the acquisition comes from intangible assets that might be most vulnerable to hackers. Financial information comes to mind. Personal information of employees does as well. But companies also need to be concerned about their trade secrets, know-how and other confidential business information whose value inheres in its secrecy. Therefore, a merely perfunctory approach to cybersecurity can become very costly. The union of companies today is a union of information, malware and all.

Energy M&A Is Not Immune

To weather the plunge in prices, many oil companies have sought out new innovations to reduce the cost of extraction and exploration. Investments in digital technologies will likely only increase—a 2015 Microsoft and Accenture survey of oil and gas industry professionals found that “Big Data” and the “Industrial Internet of Things” (IIoT) are targets for greater spend in the next three to five years. Cybersecurity threats were perceived in the survey as one of the top two barriers to realizing value from these technologies.

These developments in energy industry—bigger data and bigger vulnerabilities—are here to stay. The proposed merger of General Electric and Baker Hughes also speaks to the growing importance of analytics to oil production. Commentators note that the acquisition would allow GE more fully to implement its Predix platform, an application of IIoT to connect everything from wellhead sensors to spreadsheets. However, as last month’s massive cyberattack on DNS provider Dyn, Inc. demonstrated, the IIoT holds unique challenges as well as great promise for operational efficiency. (In this attack, reportedly 400,000 internet-linked gadgets were hacked and used to reroute web traffic to overload servers.)

Bottom Line: Robust cybersecurity diligence should be de rigueur for energy M&A.

What Can Companies Do to Protect Deal Value?

For starters, energy companies should treat cybersecurity as a separate and more involved category for due diligence.

Liability for or damages from legacy data breaches or malware can become expensive—damages to systems, theft of information and liability from the release of personal or reputation-damaging information, to name a few. Therefore, anticipating problems post-merger, cataloguing past vulnerabilities and most importantly, discovering actual breaches before closing is crucial to avoid deals blowing hot and cold.

Companies should retain IT specialists who can do an objective assessment of the cybersecurity posture of a proposed merger or acquisition. This can help prospective acquirers better determine the adequacy of a target’s cybersecurity programs, such as its policies over incident response, how access to data is distributed, the extent of a company’s online presence and vulnerabilities, and how remediation of any potential cyberthreats or actual breaches may best proceed.

A cybersecurity questionnaire should also be developed, covering such topics as:

How and where has company data been stored?
Who has had access?
Have there been any actual or attempted intrusions into (or leaks) of company data?

An acquirer could further insist on specific representations and warranties from a target company regarding their cybersecurity compliance, as well as bargain towards indemnity for prior data breaches.

On the target side, energy companies should prepare (in turn) for more scrutiny over their data security and privacy practices. Among other benefits to “knowing thyself,” getting ahead of this process should offer targeted companies a better negotiating position. It would also allow them to take a more proactive role in defining the policies of the combined company post-merger. At the very least, these efforts could help avoid the kind of hiccups and uncertainties that lead to undervaluation. In any event, poor cybersecurity practices can give an impression that a target lacks risk management in other areas—not an ideal pose to strike in any bargain.

Parting Thoughts

It is a trope in cybersecurity writing to invoke figures like Sun Tzu and shoehorn in quotes about war stratagem. Well, these habits are in some ways unavoidable: For all intents and purposes, fighting anonymous hackers resembles battle prep—a method of self-awareness and readiness that defies box-checking.

Energy companies could take these words to heart from the inestimable Miyamoto Musashi, a samurai who won 60 duels: “If you consciously try to thwart opponents, you are already late.” (A sentiment echoed more recently by Mike Tyson’s truistic “Everyone has a plan until they get punched in the mouth.”)

And This Key Takeaway: Any cybersecurity program must go hand-in-hand with a corporate culture that respects data as among its most valued assets. Efforts in detection, reporting and remediation are challenges that fall throughout the ranks and, if reflexive to the unknown, stand the best chance of being fully realized.

Bottom Line: Mind Your Data!

ARTICLE BY Jeff C. Dodd, Douglas W. Rommelmann & Ross Campbell of Andrews Kurth Kenyon

Privacy and Data Security in the Trump Administration

Privacy and data security issues were prominent in the campaign. Allegations were even made that Russia was behind the DNC hack.

Despite it being front and center in the campaign, cybersecurity did not generate specific policies from the Trump campaign. One thing Donald Trump did promise was a top to bottom review of US cyber defense and security led by government, law enforcement, and private sector experts. He also committed to establishing a Justice Department task force to coordinate responses to cyber attacks and a cyber review team to audit existing government IT systems.

Another area on which the President-elect spoke was the need to clamp down on the theft of US intellectual property, especially by foreign nations and competitors. Tools already exist to do that, of course: Economic Espionage Act of 1996. Congress, which earlier this year enacted the Defend Trade Secrets Act, is likely to respond favorably to any additional resources or authorities the new administration might seek for this purpose.

Related to cyber security were Mr. Trump’s comments on encryption during Apple’s dispute with the Justice Department in the wake of the San Bernardino terrorist attack. Trump sided strongly with law enforcement, and we can expect Congress to return to the subject of encryption in the coming session. Whether anything happens legislatively is uncertain, and some in Congress want to await the pending report of the National Academy of Science on encryption, which will remain a highly contentious issue. Still, Candidate Trump’s comments show where he stands. One wildcard in the debate may be how weakened is FBI Director Jim Comey, who has been leading the charge on encryption issues for law enforcement.

Also due for legislative consideration in 2017 is the renewal of section 702 surveillance authority under the FISA Amendments Act, which is due to sunset at the end of the year. Trump is likely to take a much more pro-surveillance position than either the current administration or Secretary Clinton might have taken. Privacy advocates in both parties are likely to press for changes in the law, but at this point the odds would be against them.

Either on its own or in conjunction with the section 702 debate, Congress is likely to return to consideration of ECPA reform. The House passed the E-mail Privacy Act unanimously this Congress, but it stalled in the Senate due to privacy groups’ opposition to an amendment sought by Senator Cornyn. The must-pass section 702 legislation is likely to provide a vehicle for e-mail privacy and related ECPA reform legislation if it does not move on its own.

Also in the mix on these issues is consideration of legislation clarifying and modernizing how domestic law enforcement accesses data across national borders. Legislation addressing that issue enjoys prominent support in Congress and may well get taken up in conjunction with ECPA reform or get lumped in with that in the context of section 702 renewal.

And the House Judiciary Committee is already moving ahead with a hearing scheduled to consider protecting geolocation data, setting up another area of dispute between law enforcement and privacy advocates.

Also in the mix legislatively will be proposals on how firms deal with data breaches and theft of information. The recently disclosed hack of Yahoo and the DNC hack have again raised the profile of data breach issues. While there is consensus that something should be done, disagreement remains on the details, including whether a federal law should preempt state data breach laws. There is little reason to expect that the disagreements can be bridged or that legislation will in fact move forward.

Finally and briefly, among other issues that Congress is likely to look at, though on which a legislative solution is unlikely are:

1) how to address distributed denial of service attacks, and the inter-related topic of the growth of the Internet of Things, on which several committees have already scheduled hearings in the wake of the recent significant DDOS attack. At this stage, Congress is likely to seek to continue to build its level of understanding of the issues here rather than act on anything;

2) how to address the recruitment of terrorists and the spread of violent extremism through social media; and

3) the implementation of last year’s Cybersecurity Information Sharing Act by the Department of Homeland Security.

One final point: the key players on these issues are likely to remain the same. One possible change would have Senate Judiciary ranking member Pat Leahy, just reelected, move to become ranking member of the Appropriations Committee, which could open the door for Senator Feinstein to become ranking member of the Judiciary Committee. She would be more sympathetic to law enforcement and less aligned with the privacy advocates than Senator Leahy has been. However, her move might allow tech-friendly Senator Mark Warner to become vice chairman of the Intelligence Committee, of which Senator Richard Burr will remain as chairman after his reelection.

ARTICLE BY Richard A. Hertling of Covington & Burling LLP

It’s Not Really ”Repeal and Replace”; It’s Transition – pt 1

For the last six years, Republicans have talked about repeal and replacement of the Affordable Care Act. The election outcome now puts Republicans in a position of authority to take action on the Affordable Care Act. As we look ahead to the 115th Congress, it is important to move away from political rhetoric and consider what can actually be achieved as a matter of public policy.

First, the Affordable Care Act is an extremely complex law including many more provisions than those related to coverage. Complete repeal of the law is not remotely realistic. For years Republicans have claimed support for provisions within the bill, some of which were actually bipartisan ideas. No one should assume complete repeal. The President-elect has already publicly voiced his support, for example, for continuing the bar on pre-existing condition exclusions from coverage.

Second, repeal and replace has been the mantra for many years, but that’s not actually the most accurate description of what Republicans want to do with the Affordable Care Act. Republicans want to provide consumers with market-driven, high-value, cost-efficient health care coverage choices provided by private insurers. That’s what Democrats arguably intended to do with the coverage provisions of the Affordable Care Act.

Ultimately, Republicans are going to transition the Affordable Care Act to function more to their liking. The core of that function will still be covering millions of Americans through market-driven, high-value, cost-efficient health care coverage choices provided by private insurers. The challenge for Republicans will be to limit the number of people who lose coverage in the transition, and it is simply wrong to assume Republicans intend to cause people to lose coverage. For example, merely repealing the individual mandate will lead to significant market disruption and loss of coverage. But if the individual mandate is transitioned to a late enrollment penalty, disruption and loss of coverage could be greatly minimized.

Finally, transition will not occur quickly. While there is much more information about the consequence of policy decisions today than there was in 2009, writing legislation, determining the impact of legislation, and then moving legislation through Congress will take much of 2017. This is not something that is likely to happen in a special session early in 2017.

This post is the first in a series. In the posts that follow, we will describe the critical issues that Republicans must tackle as they transition the Affordable Care Act into a version of health care reform that they must own and defend.

ARTICLE BY Stephen M. Weiner & Rodney L. Whitlock of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

Congress Returns for Lame Duck Session as President-Elect Trump Prepares New Administration

A New Administration and a New Congress: What to Expect

On Tuesday, November 8, the American public elected Donald J. Trump as the 45th President of the United States and elected one-third of the 100 Senators and all of the House Members who will make up the 115th Congress. As a result of the elections, President-Elect Trump will have the opportunity to work with a Republican Senate and a Republican House to address the challenges facing the country.

In his victory speech, President-Elect Trump said:

Now it’s time for America to bind the wounds of division; [we] have to get together. To all Republicans and Democrats and Independents across this nation, I say it is time for us to come together as one united people. It’s time. I pledge to every citizen of our land that I will be president for all Americans, and this is so important to me.

In the aftermath of the most bruising and bizarre presidential election in modern history, will anything get done in Washington DC? Given the stark divisions between the Republican and Democratic parties and the message voters sent to policymakers inside the Capital Beltway, can policymakers overcome their differences to address the pent up demand to resolve major issues that have been multiplying for the better part of a decade?

Senate Legislative Activity

The Senate will convene on Monday, November 14, in pro forma session. On Tuesday, November 15, the Senate will convene at 4:00pm. Following any Leader remarks, the Senate will be in a period of morning business, with Senators permitted to speak therein for up to 10 minutes each until 5:00pm. At 5:00pm, the Senate will proceed to the consideration of H.R.4511, Gold Star Families Voices Act. There be 30 minutes of debate followed by a vote on passage of the bill.

House Legislative Activity

On Monday, November 14, the House will meet at 2:00pm for legislative business, with votes postponed until 6:30pm. The following legislation will be considered under suspense on of the rules:

H.R. 1192 – National Clinical Care Commission Act;
H.R. 1209 – Improving Access to Maternity Care Act;
H.R. 2713 – Title VIII Nursing Workforce Reauthorization Act of 2016;
H.R. 4365 – Protecting Patient Access to Emergency Medications Act of 2016, as amended;
H.R. 985 – Concrete Masonry Products Research, Education, and Promotion Act of 2015, as amended;
H.R. 4665 – Outdoor Recreation Jobs and Economic Impact Act of 2016, as amended;
H.R. 2566 – Improving Rural Call Quality and Reliability Act of 2016; and
H.R. 2669 – Anti-Spoofing Act of 2016

On Tuesday, November 15, the House will meet at 12:00pm for legislative business. The following legislation will be considered under suspension of the rules:

H.R. 5732 – Caesar Syria Civilian Protection Act of 2016, as amended;
H.R. ___ – Iran Sanctions Extension Act;
H.R. 5332 – Women, Peace, and Security Act of 2016, as amended; and
H.Res. 780 – Urging respect for the constitution of the Democratic Republic of the Congo in the democratic transition of power in 2016, as amended

On Wednesday, November 16, the House will meet at 10:00am for morning hour and at 12:00pm for legislative business. On Thursday, November 17, the House will meet at 9:00am for legislative business, with last votes expected by 3:00pm. The House will consider:

H.R. 5711 – To prohibit the Secretary of the Treasury from authorizing certain transactions by a U.S. financial institution in connection with the export or re-export of a commercial passenger aircraft to the Islamic Republic of Iran, Rules Committee Print (Subject to a Rule); and
H.R. 5982 – Midnight Rules Relief Act of 2016 (Subject to a Rule)

On Friday, November 18, no votes are expected in the House.

ARTICLE BY Brandon C. Roman of Squire Patton Boggs (US) LLP

Power of Communication in Legal Marketing – The Medium Does Change the Message Part 2

Communication is important to almost everything we do–and today, we have more ways to reach out than ever before. Lee Broekman of Organic Communication and Judith Gordon of LeadeEsQ presented at the LMA Tech¹ conference in San Francisco, focusing on empowering communication by understanding the medium. In Part 1 we discussed some of the advantages and challenges of communicating face to face and through print. In this article, we will examine communication over the phone and panel communication–or any way of communication through a screen.

Phone as a medium is what it sounds like–talking on the telephone either one or one or on a conference call. The danger with this form of communication is all the other things we might be doing while we are on the phone–especially on a conference call–everyone knows how easy it is to click over to email, check Facebook on your smartphone, or start to scribble your to-do list on the paper at your desk. While you are still physically on the call, your attention drifts to the other things on your to do list. This hints at what Gordon calls “the lost art of focus.” She says, “Today’s attention spans have been radically reduced by our tether to technology. We leap from conversation to conversation—from the person speaking to us to email to headline notifications to texts back to the person speaking—without fully engaging in any one of those communications.” Staying engaged on a phone call, and reminding yourself to be present and aware is important when using the phone as a medium. One way to do this is to make sure the conversation is a back and forth–and not just a series of monologues. Additionally, if the call is a conference call with multiple participants, making sure there is a plan in place, so that each participant has a role, and that ground rules are established and enforced, can help.

Panel refers to any form of communication with a screen between the speaker and the listener. With technology, this is becoming common–web meetings, webinars and some panels where there is an audience in the room, but also some audience members are tuning in via videoconference. Gordon says, “Presenters are well served by understanding that their ‘audience’ may be viewing or only listening to a recording at a later point in time, and taking those parameters into account when preparing their presentations.” Going beyond just the people in the room is important–and one way to make sure everyone stays engaged is to have an interactive portion. Another good practice for webinars is to focus on visuals. Broekman says, “When our communication is on a panel, we need to color our black and white text and bulleted lists with vibrant visuals that will captivate our audience and keep them attentive to our intention. Many webinars present dry data instead of information that is new, relevant and interesting. Charismatic conversation, speaker photos and conceptual images in shorter timeframes will go a long way towards making the communication in this channel more effective.”

Another major concern with a panel can be a false sense of distance, and the tendency to feel bold when you cannot see the person you are talking to. This barrier is one reason Internet comment sections can get nasty, and people become callous over social media. These tendencies can be devastating when they seep into professional communications. Broekman argues, “If you can’t say it to someone’s face, don’t say it behind a screen.”

Other pitfalls haunt Panel as a communication method. Like the phone, placing the screen between people communicating removes the opportunity to see facial expressions and body language. Gordon says, “When we remove that layer of information, our brains ‘fill in the blanks’ by superimposing our own judgment, which can be devastating.” Additionally, Broekman describes one of the biggest communication problems as a failure to listen with an intention to understanding the speaker. “Instead of listening to what the other person is saying, we listen to our own internal dialogue and filter information through our personal judgments, thoughts, opinions and ideas.” A screen between parties can only amplify the tendency to hear what we want to hear. With that said, clarity in transmission is crucial, and consistent checks on understanding are important. Above all, awareness of the potential for misunderstanding is important.

For attorneys, communication is paramount. Communication is also very complicated. Gordon says, “to put it simply, lawyers ‘speak for’ their clients. Whether in transactional matters or litigation, lawyers are conduits of their clients’ intentions. To fully and accurately represent another—the essence of a lawyer’s work—understanding the fundamentals of communication is essential. Key communication skills—such as the ability to listen, understand, and then accurately present a client’s position to third parties in negotiations or litigation—are essential to a successful practice, and the smooth running of our legal system.”

Click here to read part one: Power of Communication in Legal Marketing – The Medium Does Change the Message Part 1

ARTICLE BY Eilene Spear of The National Law Review / The National Law Forum LLC

_{1 Broekman and Gordon spoke at the Legal Marketing Technology Conference on October 6th in San Francisco. Their session was entitled Webinars, Podcasts and Mobile (Oh My!) The Medium Does Change the Message. The LMA Tech conference is the largest conference dedicated to technologies that law firms use to identify, attract and support clients.}

Election 2016 Likely to Result in End of ACA as We Know It, But Employers and Plan Sponsors Should Stay Course for Now

Over the past five years or so, Republican Congressmen have repeatedly taken steps to repeal President Obama’s landmark legislative effort – the Patient Protection and Affordable Care Act (the “ACA”). However, those efforts either failed to advance in Congress or were vetoed by President Obama. Tuesday’s Presidential and Congressional election, in which Donald Trump was elected President and Republicans maintained a Congressional majority in both houses, puts the future of the ACA in jeopardy. Indeed, President-elect Trump and Congressional leaders have already confirmed that repeal of the ACA is a top priority.

Although the ACA is certainly in the crosshairs, the path to outright repeal is not so clear. Republicans have majority control in both chambers of Congress, but they do not have a filibuster-proof supermajority in the Senate. This means that unless Congress changes procedural rules, Democratic Senators can effectively block though filibuster any blanket repeal of the ACA.

So what other options do Congress and President-elect Trump have? First, Congress could invalidate many of the ACA’s revenue-related provisions through budget recollection legislation. This is not a novel approach to effect healthcare legislation – the ACA itself was a product of budget reconciliation legislation passed after Democrats lost their Senate supermajority in 2010. Budget reconciliation legislation cannot be held-up by filibuster, but the subject of the legislation must be related to revenue. Non-revenue related provisions can be struck from this type of legislation.

In 2015, the Republican-controlled Congress passed budget reconciliation legislation to invalidate many of the ACA’s revenue-related provisions. Although that legislation was vetoed by President Obama, it might be used as a template for new legislation once President-elect Trump takes office. Here are some key parts of the 2015 legislation:

The individual and employer mandates (and associated reporting requirements) would be repealed.
Expansion of Medicaid to electing States would be repealed.
The availability of premium and cost-sharing subsidies on the public insurance Marketplace would be repealed.
Taxes, such as the “Cadillac Tax”, medical device tax and increased Medicare taxes on high-earners would all be repealed.

Other ACA market reforms, such as first-dollar coverage of preventive healthcare, prohibition on preexisting condition exclusions, prohibition of annual and lifetime limits on certain benefits, and required coverage of dependents through age 26, are generally not related to revenue and probably cannot be included in budget reconciliation legislation.

Second, President-elect Trump could take immediate action to impact agency enforcement of various aspects of the ACA. For example, President-elect Trump could issue a directive to agencies to stop all enforcement of regulations currently in effect under the ACA. In addition, incoming Presidents often take immediate action to stop regulatory efforts in process. This means that proposed and pending regulations would never become effective. At the moment, regulations related to expatriate healthcare coverage and opt-out payments are currently proposed and regulations related to the Cadillac Tax are being drafted. In addition, recently proposed regulations would expand Form 5500 filing requirements to include attestations regarding compliance with the ACA. Presumably, those regulatory efforts would end.

Moreover, a significant part of the ACA’s enforcement infrastructure is found in sub-regulatory guidance – there are 34 interpretive FAQs alone – meaning that there are opportunities for the new administration to take action without significant procedural hurdles. One could surmise that the days of expansive interpretations of the ACA in sub-regulatory guidance are over and, in some cases, prior sub-regulatory guidance would be reversed.

To the extent that the ACA is limited or eliminated by these actions, there is then the question of what stands in its place. Throughout his campaign, President-elect Trump has made clear that he intends not just to repeal the ACA, but also replace it with something new. Concrete details are lacking at the moment, but the following are possible components of his replacement plan:

A cap on the employer deduction for health coverage provided to employees.
Individuals without employer-provided health coverage would receive a tax credit against the cost of coverage purchased on the individual market. The tax credit would not be an advanced premium credit, but would instead be taken in full when filing income tax returns.
Expansion of health savings accounts, including increased contribution limits, and improved price transparency from healthcare providers.
Insurance companies would be able to sell policies across state lines.
Provide block grants to states for Medicaid.
Allow consumer access to imported drugs meeting safety standards.

Ultimately, it is far too early to know exactly what President-elect Trump and the Republican-controlled Congress will do with respect to the repeal of the ACA and the enactment of new health care reform or what the impact of any of those changes will be. Even if the ACA is ultimately repealed in full or in part, it is unlikely to happen on “day one.” Therefore, at least for the time being, employers and plan sponsors should continue operating their health plans in compliance with the ACA.

ARTICLE BY Robert M Projansky, Steven D Weinstein & Damian A Myers of Proskauer Rose LLP

Workplace Law Under President-Elect Donald Trump: What to Expect

President-elect Donald Trump will assume office on January 20, 2017, with a Republican majority in both the Senate and the House of Representatives. While it is difficult to predict whether the new administration will be able to deliver on President-elect Trump’s campaign promises, we can expect significant policy and enforcement shifts. For example, judicial appointments to the U.S. Supreme Court and other federal courts will have significant and far-reaching implications. This analysis focuses on the likely dramatic impact of the Trump Administration on workplace law.

Courts

The U.S. Supreme Court has been operating with eight justices since the sudden passing of Justice Antonin Scalia in February. There also are many judicial vacancies on the federal bench. President-elect Trump likely will appoint judges more inclined to preserve the strict certification standards for class actions and rein in novel interpretations of laws such as the Americans with Disabilities Act (e.g., on disparate impact and reasonable accommodation issues).

Government Enforcement

Federal agencies increasingly have been aggressive and controversial in their enforcement methods. Under new leadership in the Department of Labor (DOL), the Equal Employment Opportunity Commission (EEOC), and the Office of Federal Contract Compliance Programs (OFCCP), among others, one can expect a return to traditional, more conservative theories of discrimination previously recognized by federal courts. We may see the EEOC ease its systemic discrimination enforcement activity and enforcement position on the ADA, Title VII, and the Pregnancy Discrimination Act. An important issue to watch is the EEOC’s position on Title VII’s application to LGBT issues. Corporate diversity and inclusion programs are not likely to be affected by the new administration, as they are driven much more by demographic changes in the population, labor force, and marketplace and risk management considerations, and much less by federal law and policy in the short-term.

Further, the focus of current controversial regulatory action will change. New DOL leadership may revisit recent DOL proposed or implemented regulations, including those subject to court injunctions. Congress may also now pass legislation to repeal the new DOL overtime rule that raises the salary level for exempt employees effective December 1, 2016, and President-elect Trump might agree. Ongoing challenges to the Occupational Safety and Health Administration (OSHA) final rules (e.g., silica and the electronic recordkeeping rule) may result in settlements that lessen the regulatory impact of the rules. Aggressive enforcement coupled with significant publicity and fines have been key tools implemented by the current administration. Under new leadership, these agencies may ease back on such aggressive approaches and offer greater cooperation to the employer community as they try to balance the purposes of the law with business realities.

Executive Orders and Actions

President-elect Trump has announced an intention to undo President Barack Obama’s Executive Orders, many of which impose significant employment-related prohibitions and requirements on government contractors. The new administration likely will rescind at least some of those Executive Orders, chief among them the controversial Fair Pay and Safe Workplaces Executive Order.

In addition, President-elect Trump has stated he will reverse the Deferred Action for Childhood Arrivals (DACA) and Deferred Action for Parents of Americans (DAPA) Executive Actions. It is unclear whether this would only address the enjoined executive relief programs or also include revocation of work authorization documents for currently eligible workers under DACA.

EEO-1 Pay Data Reporting

Final rules revising the EEO-1 report to add W-2 earnings and work hours reporting are scheduled to go into effect in early 2018. The new administration may consider rescinding the changes before first reporting is due in 2018 or revising the reporting to ease the burden on employers.

National Labor Relations Board (NLRB)

Currently, the NLRB has a 2-1 Democratic majority, with two vacant seats. Since the President traditionally has had the opportunity to appoint Board members to achieve a majority along political lines, the open seats likely will be filled by Trump appointees. This will create a more business-oriented NLRB. A new Board with a Republican majority is likely to revisit recent NLRB rules and decisions, including those covering (1) class action waivers, (2) joint employers, (3) inclusion of temporary workers in bargaining units with an employer’s regular workers, (4) quickie elections, (5) expansion of protected concerted activity (e.g., its impact on workplace policies), (6) definition of appropriate bargaining units, and (7) status of college/university adjunct faculty, graduate students, and student athletes. The new Board also may not make additional changes the current Board would make, such as extending Weingarten rights to non-union workplaces and making misclassification of employees as independent contractors a separate violation of the National Labor Relations Act (NLRA). In addition, the Labor-Management Reporting and Disclosure Act (LMRDA) “persuader” regulations, which are currently enjoined, may be revisited.

Sarbanes-Oxley Act and Dodd-Frank Act

During the campaign, President-elect Trump singled out the Dodd-Frank Act of 2010 (DFA) as making it impossible for banks to lend money to businesses for the purpose of creating jobs. A repeal of the DFA might encourage Congress and the Securities and Exchange Commission to rely more heavily on the Sarbanes-Oxley Act of 2002 (SOX) whistleblower provisions and thus mandate that corporate compliance programs, as developed by publicly traded companies, be increasingly robust, providing for greater “self-regulation.” Further SEC enforcement actions regarding confidentiality agreements likely will decrease.

Affordable Care Act (ACA)

President-elect Trump has vowed to repeal and replace the ACA. The extent to which this comes to fruition, the timing of any dismantling efforts, and the types of replacements that are offered will be of utmost importance to employers. While there has been much mentioned in broad brush strokes about a full repeal, it is unlikely that that can or will occur. Alternatives, such as the reliance on private healthcare savings accounts, market-based universal coverage and allowing for insurance plans to be offered across state lines have been floated, however, there is no Republican consensus on what the path away from the ACA will look like. Employers will be eager to see what is done to change and lessen employer obligations under the ACA, but for the meantime, will have to stay the course.

Fiduciary Rule

The DOL’s fiduciary rule concerning the expanded definition of who is considered a fiduciary under the Employee Retirement Income Security Act (ERISA) and the Internal Revenue Code, as well as certain exemptions addressing conflicts of interest, also may be subjected to increased scrutiny in light of the President-elect’s opposition to the current administration’s financial initiatives and, more generally, “unnecessary” regulations. It is hard to determine at this point where these types of regulations on fiduciary status and conduct will rank among a long list of priorities for the new administration.

Federal Tax Reform

President-elect Trump has promised sweeping federal tax reform, including tax cuts for corporations. While the viability of implementing such changes rests with the Republican Congress, the lack of specificity as to what tax reform would look like under the new administration leaves many questions. These questions include how tax reform may affect benefits plans and arrangements, such as qualified retirement plans, fringe benefits, and executive compensation arrangements.

E-Verify

The new administration may focus on expanding enforcement of existing immigration laws in the workplace, which may include encouraging more employers to use E-Verify under existing law, as well as working with Congress to expand mandatory use of E-Verify. Under current federal law, E-Verify is voluntary for employers, except as mandated by executive order for federal government contractors.

International

The new administration may suspend temporarily the issuance of visas to certain countries and regions designated as high risk. President-elect Trump has indicated he will ask the Department of State, Department of Homeland Security, and the Department of Justice to begin a comprehensive review of high-risk visa cases to develop a list of regions and countries for which visa issuance will be suspended until a proven and effective vetting mechanism is implemented. Individuals from countries such as Syria, Iraq, Libya, and other designated high-risk areas, or individuals who have traveled to such countries, will face even longer delays obtaining visas for both short- and long-term travel to the U.S. In addition, global mobility may be affected if the U.S. restricts or delays business visas, resulting in reciprocal treatment by the affected countries.

U.S. companies operating in major European markets and other countries with strong labor interests may encounter increasingly complex labor relations and works council issues, as the United States is perceived as more nationalistic and less deferential to local employee protections. Further, there may be increasing pressure from foreign vendors, suppliers, customers, and employees on U.S. companies to certify that they will comply with ILO standards.

Post-Employment Restrictions

The new administration is unlikely to continue attempts to prohibit non-compete agreements we have seen from the White House over the past months, at least on a federal level. On a state level, legislatures still may respond to the Obama Administration’s “call to action” and introduce measures to curb the use of non-compete agreements, as, for example, has been promised by New York State Attorney General Eric Schneiderman.

The “Antitrust Guidance for Human Resource Professionals,” issued by the Department of Justice and Federal Trade Commission, is not likely to continue as a priority for the new administration. The guidance promised criminal prosecution of human resource professionals who, for example, enter into “naked” no-poach agreements.

Trade Secret Protection

Adding to the bi-partisan federal Defend Trade Secrets Act, which provided a civil right of action under the Economic Espionage Act, a new administration may adopt protectionist policies, bringing further enforcement efforts to misappropriation of trade secrets flowing to foreign powers, including to China.

Cybersecurity

President-elect Trump has expressed a desire to reduce, rather than increase regulation. However, political party hacking and unfavorable email dumps from WikiLeaks, coupled with continued data breaches affecting privacy and public sector entities, may prompt the new President and Congress to do more. Politics aside, cybersecurity is a top national security concern, and it is having a significant impact on private sector risk management strategies and individual security.

DOL Opinion Letters

The long-standing practice of the Administrator of the Wage and Hour Division of the DOL issuing official opinion letters regarding application of the Fair Labor Standards Act (FLSA) upon which employers rely may make a comeback. In recent years, the DOL had stopped issuing opinion letters, choosing instead to issue less frequent “Administrator Interpretations” with wider applicability and scope, but less specificity. Two significant Administrator Interpretations concerned “joint employment” and “independent contractor” status under the FLSA. Both have been viewed as clear efforts to expand the rights of workers under the law and place additional burdens on employers. New opinion letters are issued on a variety of topics and could scale-back or withdraw the Obama Administrator Interpretations, permitting employers greater flexibility in using independent contractors and giving business more certainty in expanding through use of franchises.

White Collar

The President-elect has been critical of excessive and unnecessary government regulation in such areas as health care, energy, and the environment. We may see a decreased investigatory focus in these areas, and fewer federal prosecutions of health care organizations, pharmaceutical companies, and manufacturers.

Focused on security and protecting the homeland, the new administration may enhance emphasis on international terrorism investigations, import/export violations, and immigration offenses.

Given his pledge to improve life in “inner city” areas, we should expect greater resources and attention to be devoted to the prosecutions of criminal activity by violent gangs and an effort to address crimes that affect the daily lives of the residents of America’s cities.

***

An important question for many, especially those that operate in multiple states and must comply with the current patchwork of state laws on data breach and sick leave, for example, is whether a federal law that supersedes state law is likely. With Republicans in control of the executive and legislative branches, that remains to be seen.

ARTICLE BY Howard M. Bloom & Philip B. Rosen of Jackson Lewis P.C.

The National Law Forum

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