The National Law Forum

What's Ahead for Legal Marketing in 2014?

WebDAM, a web-based digital asset management company, took the time to gather data from industry experts and leading sources on digital marketing to create the infographic below, which illustrates the trends and statistics they believe will drive marketing in 2014.

Of primary interest to attorneys looking to strengthen their marketing program next year:

78% of marketing executives think custom content is the future of marketing(Google agrees!)
B2B companies say blogs generate 67% more leads than those that don’t blog
Marketers are finding actual, money-paying clients on LinkedIn and Facebook
Customer testimonials have the highest effectiveness rating for content marketing (89%)
Inbound marketing delivers 54% more leads than traditional outbound marketing

Article by:

Stephen Fairley

Of:

The Rainmaker Institute

Federal Terrorism Risk Insurance Act (TRIA) Impact on Workers’ Comp

Because of the significant financial impact of the Sept. 11, 2001 terrorist attacks, Congress created the Federal Terrorism Risk Insurance Act (TRIA). Its purpose is to provide a financial backstop to the insurance industry that would cap losses in the event of another large-scale terrorist event. TRIA was initially set to expire at the end of 2005, but it has been extended twice and is now set to expire Dec. 31, 2014.

federal terrorism workers compensation insurance

When most people think of TRIA, they think of property insurance. Without TRIA, many high-profile properties would be difficult to insure in the commercial marketplace. However, TRIA also plays an important role in workers’ compensation coverage, and its pending expiration is already impacting some renewals.

Workers’ compensation insurers are particularly concerned about large accumulations of employees in small areas, also known as employee concentrations. When carriers model employee accumulations, they not only look at a single employer’s concentrations, but also their aggregate accumulation exposure for all their policyholders in a particular zip code or city and in some cases across multiple correlated lines of business. Because workers’ compensation underwriters are required to provide terrorism coverage by law, the only way to limit their exposure is to reduce the amount of capacity they offer.

If TRIA is allowed to expire or is modified significantly, employers in certain cities and industries with large employee concentrations will likely experience capacity shortages. In fact, the uncertainty around TRIA’s reauthorization is already leading some workers’ compensation carriers to decline or non-renew risks in certain geographical areas, or ask for large rate increases. The healthcare, public entity, higher education, and financial sectors are particularly affected by employee concentration issues at the moment.

To mitigate the impact of TRIA’s uncertainty, employers should differentiate their risk. Since both insurers and reinsurers use catastrophic models to estimate their loss potentials, it is critical that employers provide the highest quality of exposure data to help distinguish their risk profiles from their peers.

Additionally, companies with multiple shifts or those that operate in a campus setting should make sure to report both the total number of employees and the number of employees working during peak shifts—as well as the actual buildings where the employees are located. The number of employees working during peak shifts is the actual exposure to a terrorist event, not the total number of employees. Also, companies with a large percentage of their workforce in the field or telecommuting, rather than in the office where their payroll is assigned, should give this information to insurers. Providing very detailed information can help overcome some potential pitfalls of the catastrophic models and better reflect an employer’s exposure to catastrophic losses.

Employers with a large concentration of workers, especially those in major metropolitan areas, should be prepared to provide the following information to underwriters:

Employee marital or dependency status, including dates of birth for dependents.
Employee telecommuting/hospitality practices and impact on concentration.
Physical security of the building, including information about guards, surveillance cameras, parking areas, and HVAC protections.
How access to the building is controlled.
Construction of the building and location of the offices.
Management policies around workplace violence, weapons, and employment screening.
Employee security procedures.
Emergency response/crisis management plans and procedures.
Fire/life safety program.
A list of security staff.

As we move into 2014 without Congressional action on TRIA, the reaction of the marketplace is expected to become more pronounced. It is imperative that employers prepare to address the concentration issues with their carriers. This will help lessen the impact of these concerns and position employers to receive optimal terms on their risk management programs.

Mark Walls contributed this article.

Article by:

Risk Management Magazine

Of:

Risk and Insurance Management Society, Inc. (RIMS)

Food and Drug Administration (FDA) Guidance for Industry and FDA Staff: Mobile Medical Applications

On September 25, 2013, the Food and Drug Administration (the “FDA”) released final guidance on the regulatory requirements regarding the introduction of mobile medical applications into the marketplace (the “Final Guidance”). The purpose of the Final Guidance and its Appendices is to assist manufacturers with determining if a product is a mobile medical app and if so the FDA’s expectations for that product. This Alert summarizes some the key components of the Final Guidance.

I. Summary of the Guidance

This Final Guidance informs manufacturers, distributors and other entities on how the FDA intends to apply its regulatory authorities to select software applications intended for use on mobile platforms (mobile applications).¹ Some mobile applications may meet the definition of a medical device under section 201 of the Federal Food, Drug, and Cosmetic Act (FD&C Act)), but because some may pose a lower risk to the public, FDA intends to exercise enforcement discretion. A majority of mobile applications either do not meet the definition of the FD&C Act or are in a category where the FDA intends to exercise enforcement discretion.

The FDA intends to apply its regulatory oversight on those mobile applications that are medical devices and whose functionality could post a risk to a patient’s safety if the mobile application does not function appropriately. The Final Guidance is intended to provide clarity and predictability for manufacturers of these mobile applications.

The Final Guidance provides lengthy definitions of the following terms:

Mobile Platform
Mobile Application
Mobile Medical Application
Regulated Medical Device
Mobile Medical App Manufacturer

The above-referenced definitions can be found in the full guidance.

II. Scope

The Final Guidance explains the FDA’s intent—to focus its oversight on a segment of mobile apps.

III. Regulatory Approach for Mobile Medical Apps

The FDA intends to apply its regulatory oversight to only those mobile apps that are (1) medical devices; and (2) whose functionality could pose a risk to a patient’s safety if the mobile app were to not function as intended. The FDA believes that if it fails to function as intended, this subset of mobile medical apps poses potential risks to the public health as currently regulated devices. The FDA strongly recommends that manufacturers who fall within the scope of this guidance follow the Quality System² regulation (which includes good manufacturing practices) in the design and development of their mobile medical apps and initiate prompt corrections to their mobile medical apps, when appropriate, to prevent patient and user harm. Manufacturers of mobile medical apps must meet the requirements associated with the applicable device classification.

A. Mobile medical apps: Subset of mobile apps that are the focus of the FDA’s regulatory oversight

The FDA currently intends to apply its regulatory oversight to only the subset of mobile apps.³ Of major importance, mobile apps can transform a mobile platform into a regulated medical device by using attachments, display screens, sensors, or other such methods. In spite of the transformation, FDA considers such mobile apps to be mobile medical apps.

The following are mobile apps that the FDA considers to be mobile medical apps that are subject to regulatory oversight:

Mobile apps that are an extension of one or more medical devices by connecting⁴ to such device(s) for purposes of controlling⁵ the device(s) or displaying, storing, analyzing, or transmitting patient-specific medical device data.
Mobile apps that transform the mobile platform into a regulated medical device by using attachments, display screens, or sensors or by including functionalities similar to those of currently regulated medical devices. Mobile apps that use attachments, display screens, sensors or other such similar components to transform a mobile platform into a regulated medical device are required to comply with the device classification associated with the transformed platform.
Mobile apps that become a regulated medical device (software) by performing patient-specific analysis and providing patient-specific diagnosis, or treatment recommendations. These types of mobile medical apps are similar to or perform the same function as those types of software devices that have been previously cleared or approved.

B. Mobile Apps for which the FDA intends to exercise enforcement discretion (meaning that FDA does not intend to enforce requirements under the FD&C Act)

The Final Guidance illustrates the FDA’s exercise of enforcement discretion for mobile apps that: (i) Help patients (i.e., users) self-manage their disease or conditions without providing specific treatment or treatment suggestions; (ii) Provide patients with simple tools to organize and track their health information; (iii) Provide easy access to information related to patients’ health conditions or treatments; (iv) Help patients document, show, or communicate potential medical conditions to health care providers; (v) Automate simple tasks for health care providers; or (vi) Enable patients or providers to interact with Personal Health Record (“PHR”) or Electronic Health Record (“EHR”) systems.

It is important to note that some mobile apps listed above and below may be considered mobile medical apps, and others might not.

The following examples represent mobile apps for which the FDA intends to exercise enforcement discretion:

Mobile apps that provide or facilitate supplemental clinical care, by coaching or prompting, to help patients manage their health in their daily environment.
Mobile apps that provide patients with simple tools to organize and track their health information.
Mobile apps that provide easy access to information related to patients’ health conditions or treatments (beyond providing an electronic “copy” of a medical reference).
Mobile apps that are specifically marketed to help patients document, show, or communicate to providers potential medical conditions.
Mobile apps that perform simple calculations routinely used in clinical practice.
Mobile apps that enable individuals to interact with PHR systems or EHR systems.

IV. Regulatory Requirements

Manufacturers of mobile medical apps are subject to the requirements described in the applicable device classification regulation.⁶

Our team will continue to provide you with updated information on various aspects of this Final Guidance.

¹ While many have suggested that this guidance provides similar views on software, the Agency has taken a more formalized position on certain software requirements and the classification of such products. For example, the FDA has previously clarified that when stand-alone software is used to analyze medical device data, it has traditionally been regulated as an accessory to a medical device or as medical device software. Medical Devices; Medical Device Data Systems Final Rule (76 FR 8637) (Feb. 15, 2011).

² See 21 CFR part 820.

³ See Appendix C.

⁴To meet this criterion, the mobile medical apps need not be physically connected to the regulated medical device (i.e. the connection can be wired or wireless).

⁵Controlling the intended use, function, modes, or energy source of the connected medical device.

⁶ Class I devices: General Controls, including:

Establishment registration, and Medical Device listing (21 CFR Part 807);
Quality System (QS) regulation (21 CFR Part 820);
Labeling requirements (21 CFR Part 801);
Medical Device Reporting (21 CFR Part 803);
Premarket notification (21 CFR Part 807);
Reporting Corrections and Removals (21 CFR Part 806); and
Investigational Device Exemption (IDE) requirements for clinical studies of investigational devices (21 CFR Part 812).

Class II devices: General Controls (as described for Class I), Special Controls, and (for most Class II devices) Premarket Notification.

Class III devices: General Controls (as described for Class I), and Premarket Approval (21 CFR Part 814).

Article by:

Chad D. Ehrenkranz

Nancy E. Taylor

Of:

Greenberg Traurig, LLP

Rite Aid to Pay $12.3 Million for Failing to Properly Manage Waste Products from its California Stores

Rite Aid Corporation has agreed to pay more than $12.3 million to settle a civil lawsuit alleging that Rite Aid improperly managed, transported, and disposed of hazardous waste at hundreds of its California stores and distribution centers. The hazardous wastes at issue include: pharmaceuticals and over-the-counter medications, bleaches, photo processing chemicals, pool chlorine and acids, pesticides, fertilizers, batteries, electronic devices, mercury containing lamps, paints, lamp oils and other ignitable liquids, aerosol products, oven cleaners and various other cleaning agents, automotive products, and other flammable, reactive, toxic and corrosive materials.

Background

The case against Rite Aid began in 2009 when local environmental health agencies began to investigate Rite Aid facilities’ management of hazardous wastes. Prosecutors, investigators, and environmental regulators statewide conducted a series of waste inspections at Rite Aid stores and local landfills. The inspections revealed that over a six-and-a-half year period, Rite Aid had improperly managed certain hazardous wastes at its facilities, transported hazardous waste without meeting regulatory requirements, and in some cases illegally disposed of hazardous waste in landfills not authorized to accept such waste. On September 17, 2013, fifty-three California district attorneys and two city attorneys filed a joint environmental protection lawsuit against Rite Aid. Pursuant to California Health and Safety Code sections 25516 and 25516.1, the prosecutors brought a civil action in the name of the People of the State of California and sought to enjoin violations of California’s hazardous waste, medical waste, hazardous waste transportation and hazardous materials release response laws and implementing regulations.

The Allegations

The prosecutors asserted that Rite Aid stores engaged in numerous violations of California’s hazardous waste laws and regulations, including:

Disposal of hazardous waste at unauthorized points, such a trash compactors, dumpsters, drains, sinks, toilets, Rite Aid facilities, and landfills or transfer stations not authorized to receive hazardous waste, in violation of Health and Safety Code sections 25189 and 25189.2;
Failure to determine whether each waste generated at each facility in question as a result of a spill, container break, or other means of rending the product not useable for its intended purpose was a hazardous waste, as required under the California Code of Regulations (“CCR”), Title 22, sections 66262.11 and 66260.200;
Transporting or transferring custody of hazardous wastes without a properly licensed and registered transporter, as required by Health and Safety Code section 25163;
Failure to dispose of accumulated hazardous wastes from facilities at least once during every 90 day period, as required by CCR Title 22, section 66262.34;
Failure to timely file with the Department of Toxic Substances Control (“DTSC”) a hazardous waste manifest for all hazardous waste transported for offsite handling, treatment, storage, disposal or combination thereof, as required by Health and Safety Code section 25160(b)(3) and CCR Title 22, section 66262.23;
Failure to contact the transporter or owner/operator of the designated receiving facility to determine the status of hazardous waste in the event of non-receipt of a copy of a manifest with the signature of the owner/operator within 35 days of the date the waste was accepted by the transporter, as required by CCR Title 22, section 66262.42;
Treatment, storage, disposal, and transport of hazardous waste without receiving and using a proper EPA or DTSC identification number for the originating facility, as required by CCR Title 22, section 66262.12(a);
Failure to maintain a program for the lawful storage, handling and accumulation of hazardous waste, as required by Health and Safety Code section 25123.3 and CCR Title 22, sections 66262.34, 66265.173 and 662165.177;
Failure to properly designate hazardous waste storage areas, segregate hazardous wastes, and failure to conduct inspections, as required by CCR Title 22, sections 66262.34 and 66265.174;
Failure to comply with employee training obligations for the management of hazardous waste, as required by CCR Title 22, section 66262.34;
Failure to have in place at all times a hazardous waste contingency plan and emergency procedures for each facility, as required by CCR Title 22, section 66262.34;
Failure to continuously implement, maintain, and submit a complete hazardous materials business plan, as required by Health and Safety Code sections 25503(a), 25504, 25505 and CCR Title 19, sections 2729 et seq.;
Failure to immediately report any release or threatened release of a reportable quantity of any hazardous material from any facility into the environment, as required by Health and Safety Code sections 25501 and 25507;
Failure to properly manage, mark, and store universal waste in compliance with management standards in CCR Title 22, sections 66273.1 et seq.;
Failure to comply with the California Medical Waste Management Act (Health and Safety Code sections 117600 et seq.); and
Causing to deposit, without permission of the owner, hazardous substances upon the land of another, in violation of California Penal Code section 374.8(b).

The prosecutors sought civil penalties for each violation and reimbursement of the costs of investigation, enforcement, prosecution, and attorneys’ fees.

The Consent Judgment

On September 24, 2013, Judge Linda L. Lofthus issued an order approving the consent judgment negotiated by the parties. Under the agreement, Rite Aid agreed to fully comply with the Code sections and regulations at issue in the Complaint. Moving forward, stores will be required to retain their hazardous waste in segregated, labeled containers so as to minimize the risk of exposure to employees and to ensure that incompatible wastes do not combine to cause dangerous chemical reactions. The company will continue to designate four full-time employees responsible for environmental, health, regulatory and safety compliance assurance in California. California Rite Aid stores will work with state-registered haulers to document, collect and properly dispose of hazardous waste produced through damage, spills and returns. Moreover, Rite Aid has implemented a computerized scanning system and other environmental training to manage its waste.

Rite Aid agreed to pay $9,500,000.00 in civil penalties pursuant to Health and Safety Code sections 25189 and 25514 and Business and Professions Code section 17206, to the prosecuting and regulatory agencies. Rite Aid also agreed to pay $1,974,000 for certain supplemental environmental projects. Finally, Rite Aid will pay $950,000 for reimbursement of attorneys’ fees, costs of investigation, and other costs of enforcement.

According to the Los Angeles County District Attorney’s Office, Rite Aid was cooperative with prosecutors and investigators throughout the case.

Conclusion

The Rite Aid case reflects continued active enforcement by California’s prosecutors and regulators of the state’s environmental protection laws against retailers related to alleged mismanagement of hazardous wastes. Since 2011, California regulators have secured more than seven multi-million dollar settlements in hazardous waste enforcement actions against large retailers.

Article By:

Laura Metz Duncan

Donald J. Patterson, Jr.

Sara L. Vink

Of:

Beveridge & Diamond PC

10 Blogging Tips for Your Law Firm

Everyone blogs.

These days, that sweet grandma down the street probably blogs.

With so many voices chiming in on the Web, how can yours stand out?

More to the point, how can your blog pique the interest of your target audience? You can accomplish this by simply providing unique content that answers your prospective clients’ questions and builds up your firm as an authority.

Attracting interest in your law firm by offering useful information is the essence of inbound marketing; making it easy for people to find you and making your marketing appealing enough for them to convert. Content development is a prime inbound marketing component and there is no better place to test out the effectiveness of content than through a blog.

Here are ten blogging tips for your law firm:

1) Be You

Just as your law firm’s website design reflects your practice, so should your blog. If your brand is that of a serious litigator, you would not want to share humorous or carefree content on your blog. If your firm’s goal is to provide a listening ear to personal injury victims, you should steer away from hardball posts. Embody your personality and keep your blog content consistent with your brand. Perhaps you want to be an authority on court opinions from your state appellate courts. If so, you’ll want to post about the latest appellate rulings, as Millar & Mixon does.

2) Develop a Writing Voice

Since your blog is driven by the written word, it is through your words that you will make the strongest impression. Try to echo the way you talk, using phrases that are unique to you or language that reflects your education in your writing. A simple way to pinpoint your writing voice would be to write a mock blog post or a few paragraphs about why you are a lawyer. Then, get someone who knows you well to read the piece and ask them if the content “sounds” like you. If the answer is no, keep working at it. If yes, then congratulations! You’ve just discovered your writing voice.

3) Be Interesting

It goes without saying, but your posts should be worth reading! Your blog should not be a dry repetition of facts or, worse, a carbon copy of another post. Rather than simply reporting on a new law or verdict, write on the implications of that legislation or decision for your readers. Maybe you have a unique opinion on a legal trend, a knack for explaining legal matters or you have the opportunity to interview a mover and shaker in the field. Leverage such strengths and your blog will quickly become bookmark-worthy. Here’s an example from Texas lawyer Kevin Krist, who explored the dangers posed by kids operating personal watercraft.

4) Think Outside the Box

The struggle to find compelling material is a challenge all writers face sooner or later. If you find yourself in a downward spiral, it’s time to get more creative. Grab a few people in your practice and have a five-minute, intentional brainstorming session. You will be delighted with the results a quick, focused chat can bring. Also consider using tools such as Google Alerts to prompt ideas for upcoming posts.

5) Use, Don’t Abuse, Keywords

While you should thoughtfully employ targeted keywords in your blog posts, don’t overuse them. Unnaturally using keywords in your content, a black hat SEO tactic called keyword stuffing, is seen as manipulative and spammy by search engines. Research the keywords that are competitive for your practice area and use them naturally.

6) Stay in Your Niche

Don’t blog about everything. Not only will you be drained by trying to keep up too many industry changes, your readers will become confused and not certain of what they should expect from your blog. It is in your best interest to choose specific topics that are connected to your firm’s practice areas. There may be opportunities to blog outside of your niche, but you should choose those moments wisely.

7) Don’t Duplicate Content

Not only is copy and pasting someone else’s thoughts an act of plagiarism, it is duplicating content. Duplicate content will be penalized by search engines and can eventually cause your site to fall in rankings. Quoting portions of other blog posts (with appropriate links back to their site) is perfectly fine, when done in moderation. When in doubt, use your own wording.

8) Track Results

The devil may be in the details, but the profits are in the data. Use Google Analytics to track which of your posts are gaining the most traction. With this information, you will know exactly what kinds of material your readers prefer.

9) Feature Guest Posts

Do you have a mentor who has taught you much of what you know about being a lawyer? Or maybe you know someone who is an expert in matters concerning your practice area. Reach out to these industry connections for guest blogging opportunities.

10) Don’t Force It

If writing just does not come naturally to you, don’t force it. Play to your strengths. If you are an excellent litigator but a mediocre blogger, don’t feel as if you have to be someone you are not to succeed online. Honestly assess your abilities and your time obligations.

Article by:

Victoria Wilson

Of:

Consultwebs.com, Inc.

IRS Announces Modification to “Use-It-Or-Lose-It” Rule for Health Care Flexible Spending Accounts

On October 31, 2013, the Internal Revenue Service (“IRS”) announced a modification to the “use-it-or-lose-it” rule that applies to health care Flexible Spending Arrangements (“FSAs”) under a cafeteria plan. Under the use-it-or-lose-it rule, unused amounts in a participant’s health care FSA for a plan year not used to pay eligible medical expenses incurred during the plan year were required to be forfeited to the employer, unless the employer adopted the 2 1/2 month grace period. The grace period rules permit participants to use amounts remaining from the prior year to pay eligible medical expenses incurred during the first two months and 15 days immediately following the end of the plan year (March 15 for a calendar year plan).

The New Carryover Provision

Under the new rule, an employer, at its option, may permit a participant to carryover to the immediately following plan year up to $500 in unused amounts from a health care FSA. This carryover may be used to pay or reimburse medical expenses under a health care FSA incurred during the entire plan year to which it is carried over. The rule also provides that:

The carryover does not count against or otherwise affect the maximum payroll reduction limit for the plan year ($2,500 for 2014).
Although the maximum unused amount allowed to be carried over to any plan year is $500, the plan may specify a lower amount.
If a plan permits a carryover, the same dollar limit must apply to all plan participants.
A plan that adopts the carryover provision is not permitted to provide the FSA grace period.
The use of the carryover option does not affect the plan’s ability to provide for the payment of expenses incurred in one plan year during a permitted “run-out” period at the beginning of the following year.
A plan is not permitted to allow unused amounts related to an FSA to be cashed out to the participant or used for any other taxable or non-taxable benefit.
A plan is permitted to treat reimbursements of all claims that are incurred in the current plan year as reimbursed first from unused amounts credited for the current plan year and, only after exhausting these amounts, as then reimbursed from unused amounts carried over from the previous year.
Any carryover amount used to pay for eligible medical expenses in the current plan year will reduce the amounts available to pay claims during the run-out period from the prior plan year.

For example, Jane Smith participates in her employer’s FSA with a calendar plan year, a run-out period from January 1 to March 31, an open enrollment in November for making salary reductions for the following year and the $500 carryover.

In November 2014, Jane elects a salary reduction of $2,500 for 2015. By December 31, 2014, she has $800 remaining from 2014. The plan may treat $500 of the unused $800 as available to pay 2015 expenses. Jane now has a total of $3,000 to spend in 2015. She is reimbursed for a $2,700 claim incurred in July 2015. The plan treats the first $2,500 as reimbursed with 2015 contributions, and the remaining $200 of the claim as reimbursed with unused 2014 contributions (leaving $300 for any further 2015 expenses). If she submits no further claims in 2015, the remaining $300 is carried over to 2016.

Assume these same facts, except that Jane’s $2,700 expense is incurred and submitted in January 2015 (during the 2014 run-out period). Jane is reimbursed for the claim first from 2015 contributions ($2,500) and then from 2014 contributions ($200). Since this claim was incurred during the run-out period, the 2014 run-out amount is reduced to $600 ($800-$200). If on February 1, 2015 Jane receives a medical bill from 2014 for $700 and submits the expense, the plan may only reimburse her for $600 of the total $700 claim. Jane continues to have $300 available for any 2015 expense, which may be carried over to 2016.

Next Steps

An employer that wants to implement the new carryover option must amend its cafeteria plan on or before the last day of the plan year from which amounts may be carried over and the amendment can be made effective retroactively to the first day of that plan year. For example, an employer can amend a calendar year plan on or before December 31, 2013 and have the carryover rule apply for 2013. The employer must notify participants of the new rule.

This increased flexibility will reduce a key barrier for many potential FSA users and may increase enrollment in FSA programs. Participants will no longer have to perfectly predict normally unpredictable health expenses a year in advance. Even though the carryover is limited to $500, the majority of forfeitures under the use-it-or-lose-it rule were less than $500.

Employers should carefully consider whether their employees would benefit from adopting the carryover rule instead of the grace period rule. The carryover rule is limited to $500 but permits the $500 to be used to pay for eligible expenses during the entire year into which it was carried over. In contrast, the grace period rule permits the entire amount of unused dollars in a health care FSA to be used but only to pay expenses incurred during the first 2 1/2 months of the next year.

Employers seeking to modify a 2013 plan that currently has a grace period should also carefully consider the ERISA implications of eliminating the availability of the grace period for 2013 contributions.

Article by:

Eric W. Gregory

Of:

Dickinson Wright PLLC

National Labor Relations Board (NLRB) Judge Gives a “Like” to Facebook-Related Termination

National Labor Relations Board (NLRB) Administrative Law Judge Jay R. Pollack recommended the dismissal of a complaint involving the termination of two former employees of the Richmond District Neighborhood Center, a non-profit organization in the San Francisco Bay Area that runs community programs including after-school and summer programs for youth.

The decision is all the more surprising because Judge Pollack agreed with the General Counsel that the employees at issue were engaged in protected concerted activity in complaining about their employer on Facebook; yet he found that some of the actions described by the employees (including having “crazy events [without] permission,” “do[ing] cool [expletive] and let[ting] [the employer] figure it out,” “playing loud music and get[ting] graffiti artists to place graffiti on the walls,” and hav[ing] clubs and tak[ing] the kids”) in their Facebook conversations were not protected. Accordingly, the Judge found that the employer could lawfully find that the employees conduct was not protected and that they were unfit for further service.

While this decision shows that not all social-media misconduct must be tolerated by employers, it is important for employers dealing with these types of issues to contact competent labor and employment counsel prior to making any termination decisions involving social media, as defending against an action of this nature before the NLRB can be costly.

Article by:

Scott J. Witlin

Steve L. Hernández

Of:

Barnes & Thornburg LLP

District of Columbia Court Allows Extra Virgin Olive Oil Fraud Claims To Proceed To Trial

Judge Brian F. Holeman of the D.C. Superior Court issued an omnibus order this week denying summary judgment in lawsuits against a number of D.C. grocery stores, including Safeway and Giant, paving the way for a consumer to proceed to trial on claims that the stores sold inferior quality olive oil falsely labeled as “extra virgin.” The consumer, Mr. Dean Mostofi, brought the suits as a “private attorney general” under the District’s consumer protection law.

Extra virgin olive oil is the purest and highest quality of olive oil. In order to qualify as extra virgin, olive oil must have certain chemical and sensory properties and must be free of all defects and chemical processing. The lawsuits allege that Defendants sold inferior grades of olive oil as “extra virgin.” The olives oil brands in question include Carapelli, Filippo Berio, Pompeian, Bertolli, and Safeway Select.

Testing performed by the UC Davis Olive Center in 2010 and 2011 found that a large percentage of “extra virgin” olive oil sold by those brands was actually not “extra virgin.” In addition, Mr. Mostofi employed taste-testing “panels” of olive oil experts in both California and Australia to test bottles of olive oil he purchased in D.C. Those panels—as well as an Australian chemical laboratory—indicated that some olive oil sold in D.C. under those brand names is also not truly extra virgin.

In denying summary judgment to the Defendants, the Court found that (1) expert testimony could support a finding that the oils are not, in fact, extra virgin; (2) testing on bottles other than those purchased by the Plaintiff could be considered at trial; (3) selling olive oil falsely labeled as “extra virgin” could violate a reasonable consumer’s expectation; and (4) testing performed by UC Davis and Mr. Mostofi’s expert was sufficient evidence to allow the claims on behalf of the general public to proceed to trial.

Counsel for Plaintiff, Hassan Zavareei, said, “This is a huge victory in a hard-fought battle against entrenched interests determined to prevent our case from going to trial. We are gratified that we will have an opportunity to put an end to this fraudulent food mislabeling in the District of Columbia. D.C. consumers have a right to get what they pay for.”

To read the omnibus order denying summary judgement, click here.

To read the omnibus order denying the exclusion of expert testimony, click here.

Article by:

Hassan A. Zavareei

Of:

Tycko & Zavareei LLP

2013 Year-End Planning for Lesbian, Gay, Bisexual and Transgender (LGBT) Taxpayers

2013 has been a year of historic change for the LGBT community. The landmark Supreme Court decision in U. S. v. Windsor, decided on June 26, 2013, held that Section 3 of the Defense of Marriage Act (DOMA) (defining marriage for federal purposes as being between a man and a woman) violates the equal protection clause of the Constitution and is therefore unconstitutional.

For married same-sex couples living in one of the 14 states (as of this writing) or District of Columbia which recognize same-sex marriages, their marriages are now recognized for both federal and state purposes. Married same-sex couples living in a state that does not recognize same-sex marriages are left with many questions.

Place of Celebration

On August 29, 2013 the IRS released Revenue Ruling 2013-17 clarifying that where a couple was married (place of celebration) rather than where a couple resides (place of domicile) determines a same-sex couple’s marital status for federal tax purposes. A tremendous benefit of this decision is that married same-sex couples can now travel freely across state lines and be considered married in each state for federal tax purposes. This ruling applies to same-sex marriages legally entered into in a US state, the District of Columbia, a US territory or foreign country. The ruling does not apply to civil unions, registered domestic partnerships or similar relationships that might be recognized under state law but do not necessarily guarantee the same protection as marriage.

Impact on Gift and Estate Taxes

Before the Windsor decision, transfers between same-sex married couples could result in significant gift and estate taxes. Now transfers between same-sex spouses can generally be made with no tax consequences. In addition, certain estate provisions such as portability, the marital deduction and qualified terminable interest property (QTIP) trusts are now available to same-sex married couples. Other commonly used estate and gift planning tools for married couples, such as gift splitting and spousal rollover IRA’s, are also now available to a same sex married couple.

If you die in a state that does not recognize same-sex marriage, your spouse will not automatically inherit under state spousal rights statutes. Therefore, if the couple intends to inherit from each other, a will or living trust is still needed.

Planning tip: An important part of 2013 year-end planning is to review and update wills and estate documents to make sure to take advantage of the new rules and to properly designate beneficiaries.

Impact on Income Taxes

Many married couples have a lower joint tax liability because of netting income and deductions, eligibility for certain tax credits and income exclusions, or have an increased tax liability due to the marriage penalty tax or because of limitations on deductions based on their combined adjusted gross income. For 2013, LGBT couples considered married under the state of celebration rule will have to file their federal tax return as married filing joint or married filing separate, which may cause a shift in tax planning.

Planning tips: As part of 2013 year-end planning, same-sex couples should work with their tax advisors to determine if original or amended returns, using married filing joint or married filing separate status, should be filed for years open under the statute of limitations. The statute for a refund claim is open for three years from the date the return was filed or two years from the date the tax was paid, whichever is later. Projections should be run to compare the potential benefit or cost of a married-joint filing versus separate-single or head of household filing, as there may be a better tax result to leave the returns as filed and not amend.

In addition, same-sex couples should consider credits that might not have been available as single filers, or consider the traditional year-end planning ideas for married couples mentioned in other sections of this guide.

Impact on Benefits

Before the fall of DOMA, benefits provided to the non-employee same-sex spouse, such as employer provided health insurance, flexible spending plans, etc. were paid with after-tax dollars and the benefit was included in the employee’s taxable income. Now, same-sex couples can pay for these benefits with pre-tax dollars and the coverage will not be included in their taxable income. Employees can file amended returns (for years prior to 2013) excluding those benefits from taxable income and request refunds. Also, employers who paid payroll taxes based on previously taxed health insurance and fringe benefits can also file amended returns (Notice 2013-61 provides guidance to employers for correcting overpayments of employment taxes (FICA) for 2013).

On August 9, 2013, the US Department of Labor (DOL) announced that the Family and Medical Leave Act (FMLA) extends only to same-sex marriage couples who reside in states that recognize same-sex marriage.

On September 18, 2013 the DOL announced (in Technical Release 2013-04) that same-sex couples legally married in a jurisdiction that recognizes their marriage will be treated as married for purposes of the Employee Retirement Income Security Act of 1975 (ERISA) and the Health Insurance Portability and Accountability Act of 1996 (HIPAA). The DOL recognizes the marriage regardless of where the legally married couple currently resides. This announcement covers pensions, 401K’s, and health plans.

The Social Security Administration (SSA) also announced that it will process and pay out spousal retirement claims for same-sex spouses. The SSA urges people who believe they are eligible for benefits to apply as soon as possible in order to establish a protective filing date, which is used to determine the start of potential benefits. Under the SSA’s “Windsor instructions”, claims can be filed when the holder of a social security number was married in a state that permits same-sex marriages and resides in a state that recognizes same-sex marriage at the time of application. Once benefits are approved, the recipient can move to any state without disqualification. Applications that don’t meet these criteria are being held for later processing when further guidance is issued.

Planning tips for employees: Employees in a same-sex marriage should consider amending their tax returns if they were paying for employer-provided benefits to their spouse. Employees in a same sex-marriage should also review the benefits their employer offers to married couples to make sure they are taking full advantage of all benefits. Also, same-sex married couples should provide their Human Resource Department with a copy of their marriage license and confirm that the spouse’s insurance coverage is no longer being included in taxable income and/or that an appropriate adjustment will be made for the 2013 calendar year.

Planning tips for employers: Employers should ensure that their benefits packages are in compliance with the new laws. See Rev. Rul. 2013-61 for guidance on how to correct overpayments of employment taxes for 2013 by either adjusting 4th QTR 2013 Form 941, (correcting the 1st -3rd Quarterly filings) or by filing Form 941-X (correcting all quarters of 2013).

Pre- and Post-Nuptial Agreements

Consider agreements for same-sex couples to avoid disagreements and litigation expenses for future possible divorce. State uncertainty remains.The majority of states currently do not recognize same-sex marriages. There are prominent court cases challenging these state laws, and the resulting impacts on tax and estate planning for same-sex married couples are as yet unknown.

Article by:

Janis Cowhey McDonagh

Of:

Marcum LLP

Today’s Tip for Commercial Litigators: Making a Legal Argument Versus Being Argumentative

Trials are the culmination of extensive discovery and oftentimes unsuccessful attempts to resolve matters out of court. Parties can spend significant resources preparing for trial; they have a lot to gain or lose; and they expect a great deal from their attorneys. As a result, the tension can get thick between opposing attorneys during trial.

Keep in mind that no matter what your feelings may be about opposing counsel by the time of trial, demeaning a lawyer in court never helps your client’s case. Similarly, stay cool if opposing counsel acts disrespectfully towards you for the following reason—juries may not understand the nuances of a legal argument, but they know a cheap shot when they see it.

The same holds true for cross-examination, which can be sufficiently aggressive to fit the purpose. Yet an overly aggressive cross-examination can backfire when an attorney’s apparent hostility towards a witness becomes more prominent than the substance of the questions and answers.

For example, suppose you represent a plaintiff in a breach of contract action. The civil defendant’s mother is testifying about a conversation she alleges took place between the parties. Your goal during cross-examination is to undermine her testimony by showing that she is inherently biased. Instead of attacking the mother, perhaps cross-examination could consist of the following, “Ma’am, it is true that you love your son, correct? You are aware that your son is being sued for breaching a contract with my client, correct? Are you are aware that if your son is found to be in breach of the contract, he would owe my client a significant amount of money? Is it fair to say that you don’t want to testify in a way that would hurt your son?”

At this stage, most reasonable juries are going to discount whatever the mother says. However, if you simply go on the attack, the cross-examination will be more about disrespecting someone’s mother than showing the witness’ bias. The point is that zealous advocacy for a client does not translate into exhibiting hostility towards opposing counsel or an adverse witness.

Article by:

Stephen C. Shannon

Of:

Odin, Feldman & Pittleman, P.C.

The National Law Forum

Federal Terrorism Risk Insurance Act (TRIA) Impact on Workers’ Comp

Like this: