The National Law Forum

Timeliness – The Devil Is in the Details (a.k.a. Rules)

GEA Process Engineering, Inc. v. Steuben Foods, Inc.

In an order issued by the Patent Trial and Appeal Board (PTAB or Board), the Board expunged exhibits from the records of five related cases on the basis of timeliness. GEA Process Engineering, Inc. v. Steuben Foods, Inc., Case Nos. IPR2014-00041, IPR2014-00043, IPR2014-00051, IPR2014-00054, IPR2014-00055 (PTAB, Sept. 29, 2014) (Elluru, APJ).

In post-grant proceedings, it is important to note that there are two different deadlines for objecting to evidence. Prior to institution, a patent owner is required to object to evidence submitted to the PTAB with the petition within 10 business days of institution of a trial. Once the trial has begun, i.e., after institution, a party seeking to object to the introduction of evidence or an exhibit must raise its objection within five business days of service of the evidence or exhibit. The objections should be served on the offering party and not filed with the PTAB.

In GEA Process Engineering v. Steuben Foods, following the institution of trial, the petitioner filed what it characterized as exhibits entitled “Petitioner’s Objections” to the patent owner’s evidence. However, the PTAB expunged the exhibits from the records of all five cases. As the Board explained, the applicable rule, 37 C.F.R. § 42.64(b)(1), requires that “[o]nce a trial has been instituted, any objection [to evidence] must be served within five business days of service of evidence to which the objection is directed.” As such, the petitioner’s filingits objections to the patent owner’s evidence, at the Board was improper—a potentially costly mistake.

ARTICLE BY

Ryan Edmond Vachon

McDermott Will & Emery

FCC: The New Data Security Sheriff In Town

Data security seems to make headlines nearly every week, but last Friday, a new player entered the ring. The Federal Communications Commission (“FCC”) took its first foray into the regulation of data security, an area that has been dominated by the Federal Trade Commission. In its 3-2 vote, the FCC did not tread lightly – it assessed a $10 million fine on two telecommunications companies for failing to adequately safeguard customers’ personal information.

The companies, TerraCom, Inc. and YourTel America, Inc., provide telecommunications services to qualifying low-income consumers for a reduced charge. The FCC found that the companies collected the names, addresses, Social Security numbers, driver’s licenses, and other personal information of over 300,000 consumers. The data was stored on Internet servers without password protection or encryption, allowing public access to the data through Internet search engines. This, the FCC found, exposed consumers to “an unacceptable risk of identity theft.”

The FCC charged the companies with violation of Section 222(a) of the Communications Act, which it interpreted to impose a duty on telecommunications carriers to protect customers’ “private information that customers have an interest in protecting from public exposure,” whether for economic or personal reasons. Additionally, the companies were charged with violation of Section 201(b), which requires carriers to treat such information in a “just and reasonable” manner.

The companies were determined to have violated Sections 201(b) and 222(a) by failing to employ “even the most basic and readily available technologies and securities features.” The companies further violated Section 201(b), the FCC found, by misrepresenting in their privacy policies and statements on their websites that they employ reasonable and updated security measures, and by failing to notify all of the affected customers of the data breach.

Commissioners Ajit Pai and Michael O’Rielly dissented, arguing that, among other things, the FCC had not before interpreted the Communications Act to impose an enforceable duty to employ data security measures and notify customers in the event of a breach. Though now that the FCC has so-interpreted the Act, we can expect the FCC to keep its eye on data security.

The FCC made clear that protection of consumer information is “a fundamental obligation of all telecommunications carriers.” Friday’s decision also makes clear that the FCC will enforce notification duties in the event of a breach, and will look closely at carriers’ privacy policies and online statements regarding data security.

ARTICLE BY

David A Munkittrick

Proskauer Rose LLP

How Should IME (Independent Medical Examination) Doctors Apportion for Pre-Existing Impairment Using the AMA Guides and Rule 20 Guidelines?

In West Virginia, Workers’ Compensation statutes provide that an employee who has a definitely ascertainable impairment resulting from an occupational or non-occupational injury, disease, or any other cause, whether or not disabling, and the employee thereafter receives an injury in the course of and resulting from his employment, the prior injury and the effect of the prior injury and aggravation shall not be taken into consideration in fixing the amount of compensation or impairment allowed by reason of the subsequent injury. The statute provides that compensation, i.e., a permanent partial disability impairment rating, shall be awarded only in the amount that would have been allowable had the employee not had the pre-existing impairment.

No provision in this particular code section requires that the degree of pre-existing impairment be definitely ascertained or rated prior to the injury received in the course of and resulting from the employment or that the benefits must have been specifically granted or paid for the pre-existing impairment. Additionally, the degree of pre-existing impairment may be established at any time by competent medical evidence. It is not clear in the rules or statutes whether a reduction of an award for a pre-existing degenerative impairment should be calculated after the application of the tables in Rule 20 for determining impairment in regard to the lumbar, thoracic, or cervical spine or before the application of these tables.

In West Virginia, with regard to permanent partial disability evaluations and awards, such assessments shall be determined based upon the range of motion model contained in the AMA Guides, 4th Edition. Once an impairment level has been determined by range of motion assessment in regard to a claimant’s spine injury, that level will be compared with the ranges set forth in the corresponding tables for permanent impairment as found in Rule 20, W. Va. C.S.R. § 85-20 et seq. Permanent partial disabilities in excess of the range provided in the appropriate category as identified by the rating physician are reduced to within the ranges set forth in these tables found in Rule 20. A single injury or cumulative injuries that lead to permanent impairment to the lumbar, thoracic, or cervical spine area of one’s person shall cause an injured worker to be eligible to receive a permanent partial disability award within the ranges identified in the tables found in Rule 20.

The rating physician must identify the appropriate impairment category and then assign impairment within the appropriate range designated for that category. Rule 20 provides that all evaluations, examinations, reports, and opinions with regard to the degree of permanent whole body medical impairment which an injured worker has suffered shall be conducted and imposed in accordance with the AMA Guides, 4th Edition. Rule 20 does not specifically address allocation of physical impairment at any time but does dictate that degenerative conditions are not compensable. Also, Rule 20 allows for an evaluating physician to deviate from the rule with sufficient explanation for the deviation.

In a memorandum decision issued by the West Virginia Supreme Court of Appeals on June 11, 2014, the Supreme Court reversed and remanded a decision of the Office of Judges and Board of Review based on an employer’s appeal and found that the Office of Judges inappropriately concluded that the reviewing doctor did not correctly apportion for the claimant’s pre-existing condition when she did so after applying the table for impairment found in Rule 20. The Supreme Court specifically noted that the physician correctly and appropriately apportioned for a pre-existing impairment after applying the tables found in Rule 20. Even though this is a memorandum decision that does not have any specific syllabus points, it certainly is the only decision we have from the high court which shows that apportionment for a pre-existing condition should be made after applying the tables of impairment for the lumbar, thoracic, or cervical spine found in Rule 20.

ARTICLE BY

Alyssa A Sloan

Steptoe & Johnson PLLC

Contract Corner: Cybersecurity (Part 3)

Over the last two weeks, we discussed contract provisions designed to address the implementation of preventive security measures, as well as responding to security incidents. Our third and final blog post in this series focuses on contractual provisions that address the allocation of liability for breaches that result in security incidents.

Because of the potential for large-scale damages from a security incident, customers and service providers are generally very focused on the allocation of liability in indemnification and liability provisions. Below we list some key issues to consider when drafting these contract provisions.

Rather than relying on general negligence or contract breach standards, consider adding security incidents resulting from a contractual breach as separate grounds for indemnification coverage.
Determine whether indemnification is limited to third-party claims or includes other direct and/or indirect damages and liabilities caused by a security incident.
Coordinate indemnification defense with incident response provisions and consider the effect on the customer’s client relationships where the vendor assumes such defense.
Assess whether all potential damages from a security incident are covered by the damages provisions, including any damages that may be considered indirect or consequential.
To determine the allocation of liability, consider the contract value, industry norms, type of data at issue, potential business exposure, cost of preventative measures, and cause of the security incident.
Consider calling out specific damages related to a security breach that are not subject to any cap or exclusion to provide clarity and protection—such damages can include the costs of reconstructing data, notifying clients, and providing them with identity protection services.

With cyber attacks growing in number and sophistication on a daily basis and the increased amount and value of data that is at risk to such attacks, cybersecurity concerns are top of mind for senior management.

This post is part of our recurring “Contract Corner” series, which provides analysis of specific contract terms and clauses that may raise particular issues or problems. Check out our prior Contract Corner posts for more on contracts, and be on the lookout for future posts in the series.

Click here for Part 1.

Click here for Part 2.

ARTICLE BY

Peter M. Watt-Morse

A. Benjamin Klaber

Morgan, Lewis & Bockius LLP

How to Measure Your Email Marketing Performance

Email newsletters have proven to be one of the most effective methods for attorneys to market themselves to prospects, clients and referral sources. Every year, email marketing service provider MailerMailer provides a report on email marketing metrics across 34 different industries, including Legal.

They have just issued their 2014 report, based on data gathered from 62,000 newsletter campaigns totaling 1.18 billion emails sent between Jan. 1, 2013 and Dec. 31, 2013. Here are the results — and what should be your new benchmarks — for your law firm newsletter:

Open rate (what percentage of your recipients opened your email):  13.5%

Click rate (what percentage of your recipients clicked on a link in your email)::  1.6%

Click-to-open rate (of the recipients who opened your email, what percentage of them clicked on a link):  11.8%

Bounce rate (the percentage of emails that cannot be delivered):  2.4%

Every email service (Constant Contact, Mail Chimp, iContact, etc.) provides these statistics for each newsletter you send out. If your newsletters are not delivering at rates that meet or exceed the benchmarks above, you have a problem.

Here’s what you should consider to improve your click, open and bounce rates:

Are your subject lines engaging to entice people to open your email? Short subject lines — 4 to 15 characters — generate the highest open and click rates.

Are you sending emails on the right day and at the right time? The highest open rates occur on Mondays and the highest click rates occur on Sundays. Open rates peak during the early part of the day, between 8 a.m. and noon.

Is your email list updated regularly and cleaned of old, undeliverable email addresses? Bounce rates are inescapable but can be improved if you send out emails on a regular basis.

Have you segmented your email list so you can tailor your content to your different audiences? Targeted emails deliver 18 times more revenue than general blast emails.

Are your emails personalized? Personalizing the message content can boost open rates significantly.

Do you use a responsive design template so your emails are displayed properly for every screen size? More than half of emails are now opened on mobile devices.

If your newsletters are performing at or above these benchmarks, you may still have some work to do: if you don’t know the source of your success, you can’t repeat it.

ARTICLE BY

Stephen Fairley

The Rainmaker Institute

EEOC Loses on Procedural Grounds in Hotly Contested Case Challenging CVS Pharmacy Separation Agreement

Employers should continue to proceed with caution despite the recent pro-employer decision in EEOC v. CVS Pharmacy, Inc., a closely-watched case in which the EEOC alleged that CVS’ standard separation agreement interfered with the rights of former employees to file an EEOC charge or participate in an EEOC investigation. Although summary judgment was granted in favor of CVS by Judge John W. Darrah of the Northern District of Illinois, the court chose not to address the merits of the case, and instead dismissed the lawsuit on procedural grounds based on the EEOC’s failure to conciliate the case prior to filing its lawsuit.

This lawsuit was unique because there was no allegation that CVS had engaged in discrimination or retaliation under Title VII of the Civil Rights Act of 1964 (Title VII). Rather, the EEOC alleged that CVS’ mere use of its standard separation agreement constituted a “pattern or practice” of resistance under Section 707 of Title VII. Among several challenged provisions, the separation agreement required former employees to release all waivable claims against CVS, prohibited them from filing any lawsuits or claims against CVS, and required former employees to notify CVS if they participated in an agency investigation. A disclaimer expressly stated that execution of the separation agreement was not intended to interfere with the right to participate in an agency proceeding or from cooperating with such agency.

The court granted summary judgment to CVS due to the EEOC’s failure to conciliate prior to filing suit. Yet, this decision provides little comfort for employers that utilize separation agreements with similar terms. Although the issue of whether the agreement constitutes a “pattern or practice” violation of Title VII remains unsettled, a resolution may be forthcoming as the EEOC is currently pursuing a similar theory in a case pending in the District of Colorado.

The court’s opinion includes a footnote that may prove helpful to employers. Judge Darrah noted that it was unreasonable to interpret CVS’ separation agreement as prohibiting employees from filing an EEOC charge and that, even if the agreement did prohibit the filing of a charge, that provision would simply be unenforceable and “could not constitute resistance to [Title VII]” such that the agreement would violate Title VII. However, this comment is non-binding dicta and not precedential.

ARTICLE BY

Lauren S. Novak

Schiff Hardin LLP

United States Supreme Court Round-Up: Key Opinions from 2013 to 2014 and Upcoming High-Profile Business Disputes

The 2013–2014 term of the United States Supreme Court resulted in a wide range of decisions of importance to business. In this article, we highlight some of the key opinions and explore their likely impacts. We also preview a few of the high-profile business disputes the Supreme Court has agreed to hear next term.

Key Business Cases from the 2013–2014 Term

American Chemistry Council v. Environmental Protection Agency: Holding: The Environmental Protection Agency (EPA) reasonably interpreted the Clean Air Act to require sources that would need permits based on their emission of chemical pollutants to comply with “best available control technology” for greenhouse gases. Effect: The decision reinforces the Supreme Court’s previous recognition that the EPA has the power to regulate greenhouse gases as pollutants. However, portions of the decision strongly cautioned the EPA against overreach, stating that the agency may not “bring about an enormous and transformative expansion in [its] regulatory authority without clear congressional authorization.” These comments suggest that the Supreme Court may take a hard line when the Obama Administration’s other climate regulations eventually go to court.

Daimler AG v. Bauman: Holding: A foreign company doing business in a state cannot be sued in that state for injuries allegedly caused by conduct that took place entirely outside of the United States. Effect: Daimler makes it much harder for plaintiffs to establish general jurisdiction over foreign entities. The opinion re-characterizes general jurisdiction as requiring the defendant to be “at home” in the state, a circumstance that the Supreme Court suggested will generally be limited to the places where the defendant is incorporated or where it has its principal place of business. Moreover, the fact that a domestic subsidiary whose activities are imputed to the foreign parent may be “at home” in the state will not make the foreign parent “at home” in that locale for purposes of general jurisdiction.

Halliburton v. Erica P. John Fund, Inc.: Holding: Plaintiffs in private securities fraud actions must prove that they relied on the defendants’ misrepresentations in choosing to buy stock. Basic v. Levinson’s holding that plaintiffs can satisfy this reliance requirement by invoking a presumption that the price of stock as traded in an efficient market reflects all public, material information, including material misstatements, remains viable. However, after Halliburton, defendants can defeat the presumption at the class certification stage by proving that the misrepresentation did not in fact affect the stock price. Effect: While investors will continue to pursue class actions following large dips in stock prices, the Halliburton decision helps to level the playing field by providing defendants a mechanism to stop such suits at the class certification stage.

Lawson v. FMR LLC: Holding: Employees of privately held contractors or subcontractors of a public company are protected by the anti-retaliation provision of the Sarbanes-Oxley Act of 2002 (SOX). Effect: Following Lawson, there will likely be an increase in SOX litigation against public and non-public companies. Because many of the issues concerning the scope and meaning of SOX have yet to be resolved, lower courts will continue to wrestle with defining the parameters of the law. Questions left unanswered byLawson include whether the whistleblower’s accusation must be related to work he or she performed for the company and whether the contract with the public company must have some relation to public accounting or securities compliance.

Chadbourne & Park LLP v. Troice: Holding: The Securities Litigation Uniform Standards Act of 1988 (SLUSA) does not preclude state-law class actions based on false representations that the uncovered securities that plaintiffs were purchasing were backed by covered securities. Effect: SLUSA bars the bringing of securities class actions “based upon statutory or common law of any state” in which the plaintiff alleges “a misrepresentation or omission of a material fact in connection with a purchase of sale of covered securities.” The statute defines “covered securities” to include only securities traded on a national securities exchange or those issued by investment companies.

U.S. v. Quality Stores: Holding: Severance payments to employees who are involuntarily terminated are taxable wages for purposes of the Federal Insurance Contributions Act. Effect: Employers should, under most circumstances, treat severance payments to involuntarily terminated employees as wages subject to FICA taxes. There are exceptions, however, and employers should therefore seek legal counsel to assist in determining the tax status of a particular severance arrangement.

Business Cases to Watch in the 2014–2015 Term

Integrity Staffing Solutions v. Busk: Whether time spent in security screenings is compensable under the Fair Labor Standards Act.

Mach Mining v. Equal Employment Opportunity Commission: Whether and to what extent a court may enforce the Equal Employment Opportunity Commission’s mandatory duty to conciliate discrimination claims before filing suit.

Omnicare v. Laborers District Council Construction Industry Pension Fund: Whether, for purposes of a claim under Section 11 of the Securities Act of 1933, a plaintiff may plead that a statement of opinion was untrue merely by alleging that the opinion itself was objectively wrong, or must the plaintiff also allege that the statement was subjectively false through allegations that the speaker’s actual opinion was different from the one expressed.

Young v. UPS: Whether, and in what circumstances, an employer that provides work accommodations to non-pregnant employees with work limitations must provide work accommodations to pregnant employees who are similar in their ability or inability to work.

As in recent years, the Supreme Court continues to grant review on more and more cases involving matters of concern to U.S. businesses. Andrews Kurth attorneys are available to provide further detail and guidance on the decisions highlighted here, and on any other issues of concern to your company that have reached the high court.

ARTICLE BY

Kelly Sandill

Andrews Kurth

Managing Ebola Concerns in the Workplace [PODCAST]

Many employers are struggling to understand the potential workplace implications of Ebola hemorrhagic fever (EHF). We invite you to listen to a complimentary 48-minute podcast during which three Jackson Lewis practice group leaders discuss some of the legal and practical issues relating to the virus. Among the issues discussed are:

Steps employers should consider taking to ensure OSHA and state workplace health and safety laws are satisfied;
ADA, GINA and FMLA compliance challenges that may arise as employers attempt to lawfully identify and manage employees who are or may have been exposed to Ebola; and
HIPAA and other sources of privacy and medical confidentiality obligations that should be considered as employers respond to workplace Ebola concerns.

You can access the podcast here.

ARTICLE BY

Bradford T. Hammock

Jackson Lewis P.C.

Retrogression for EB-5 Predicted at IIUSA Conference; July 2013 Cut-Off Discussed

The Chief of the Visa Control and Reporting Division of the U.S. Department of State, Charles Oppenheim, reported that the EB-5 immigrant visa category would likely retrogress in July 2015. However, this does contradict his prediction provided to AILA earlier last week of retrogression occurring in May 2015. What is striking about Oppenheim’s announcement was that retrogression of the EB-5 immigrant visa category would cause him to establish a cut-off date of July 2013. A cut-off date has the effect of establishing an orderly line for the issuance of EB-5 immigrant visas. The cut-off date is determined based on the date an I-526 Petition was filed and is the date included on each I-526 Petition approval notice in the “Priority Date” box. For example, if a cut-off date of July 2013 is established in July 2015, during the month of July 2015, only those EB-5 investors (and their derivative beneficiaries) with a Priority Date in July 2013 or earlier (i.e. June 2013, May 2013, etc.) may apply for an EB-5 immigrant visa.

As we have stated previously, EB-5 investors should continue to file I-526 Petitions in the regular course of business because retrogression will have no effect on the adjudication of I-526 Petitions by the U.S. Citizenship & Immigration Services. By filing an I-526 Petition, an EB-5 investor is reserving his or her place in line by establishing his or her Priority Date, which has the effect of determining when he or she may apply for an EB-5 immigrant visa after receiving approval of his or her I-526 Petition. However, there are other effects of retrogression which should be evaluated when making a decision to pursue an EB-5 immigrant visa.

Oppenheim attributed the establishment of a July 2013 cut-off date to the increasing volume of I-526 Petition approvals by the U.S. Citizenship & Immigration Services (the USCIS) and his estimation of approximately three derivatives per I-526 Petition. According to his own calculations, this would indicate that there are roughly 3,333 principal investors under the EB-5 Program, with the remaining 6,667 EB-5 immigrant visa slots filled by family members of EB-5 investors. As retrogression of the EB-5 immigrant visa category may cause a drop in market demand for the EB-5 immigrant visa, it appears the inclusion of dependents against the 10,000 limit of EB-5 immigrant visas available for each U.S. government fiscal year (Oct. 1 to Sept. 30) would likely constrain the flow of foreign investor capital to the United States.

ARTICLE BY

Dillon R. Colucci

Greenberg Traurig, LLP

‘Tis The Season To Think About Your Retail Lease

With November nearly upon us, the holiday shopping season is right around the corner. For retailers, the peak season can bring a whole host of issues to be considered in connection with a commercial lease. The best time to think about these issues is now – before the droves of eager customers start lining up at the doors. So, if you are a retailer and lease a space for your business, take a few minutes and consider the following:

Does your lease require that you only operate during certain hours, preventing you from participating in “Black Friday” or staying open late during especially busy days?
Is there available parking for seasonal employees?
Are there any limitations in the lease about the type of signage or decorations? Must signs or decorations be approved by a landlord?
Are there any provisions prohibiting special activities in or around the store (i.e., having carolers, a gift wrapping station, or passing out hot chocolate to bystanders)?
If you are in a multi-unit building, how will advertising and general maintenance costs be divided? In other words, who is really paying for Santa and his elves to be stationed in the center?

Shopping Christmas Santa Claus

By addressing these issues early, landlords and tenants can reduce the possibility of misunderstandings and disputes during the shopping season. A little forethought and communication can go a long way in making everything merry and bright.

The National Law Forum

Timeliness – The Devil Is in the Details (a.k.a. Rules)

GEA Process Engineering, Inc. v. Steuben Foods, Inc.

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FCC: The New Data Security Sheriff In Town

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How Should IME (Independent Medical Examination) Doctors Apportion for Pre-Existing Impairment Using the AMA Guides and Rule 20 Guidelines?

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Contract Corner: Cybersecurity (Part 3)

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How to Measure Your Email Marketing Performance

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EEOC Loses on Procedural Grounds in Hotly Contested Case Challenging CVS Pharmacy Separation Agreement

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United States Supreme Court Round-Up: Key Opinions from 2013 to 2014 and Upcoming High-Profile Business Disputes

Key Business Cases from the 2013–2014 Term

Business Cases to Watch in the 2014–2015 Term

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Managing Ebola Concerns in the Workplace [PODCAST]

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Retrogression for EB-5 Predicted at IIUSA Conference; July 2013 Cut-Off Discussed

Like this:

‘Tis The Season To Think About Your Retail Lease

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