The Do’s and Don’ts of Data Cleaning – Don’t Drown in Bad Data

Bad CRM data can compound exponentially, impacting marketing and business development. It’s essential to understand the scope of  your data problems and follow a plan for regular data cleaning.  

Have you ever heard the saying, “No man ever steps into the same river twice”? Because a river’s water is constantly flowing and changing, the water you step in today will be different from yesterday. The same is true for the data in your CRM system: people are constantly changing roles, relocating, retiring; companies are opening, closing, moving and merging.

On top of that, new data isn’t always entered correctly. As a result, a database with clean, correct information today will not necessarily be accurate tomorrow. Over time, this bad data can compound exponentially, resulting in ineffective marketing, events and communication campaigns because as your data degrades, you reach fewer members of your target audience.

For professional services firms, poor data quality in your CRM system can also translate into a decline in system adoption. Once your professionals see bad data, they won’t trust the system as a whole and ultimately may outright refuse to use it. This is why we stress the importance of ongoing data cleaning.

Data Cleaning Do’s and Don’ts

Simply put, data cleaning involves identifying incorrect, incomplete and/or dated data in your systems and correcting and enhancing it. If you have a large database with thousands, or hundreds of thousands, of records, the data quality process can seem daunting and overwhelming.

While there’s no magic bullet or quick fix for poor data quality, ignoring data problems until there’s a crisis is not a strategy. Good data quality requires ongoing effort that never ends. The good news is that this means you have forever to get better at it. So, start now. Begin by assessing the scope of your data quality issues. Then, because it’s not always cost-effective or even possible to clean all your data, start by focusing on the highest priority projects.

Identify and Prioritize Your Most Important Data

All contact records are not created equal. For instance, client data is typically more important than non-client data. Additionally, individuals who have recently subscribed to your communications or attended an event are more important than those who last interacted with your firm years ago. Whatever segmenting scenario you select, it’s important to find ways to divide your contact data into manageable pieces because it makes the process more manageable and allows you to better measure progress.

Eliminate Stagnant Records

Related to prioritizing your data, don’t be hesitant about removing records that have been inactive for an extended period. Search your system for contacts that have not been updated for a few years, are not related to or known by any of your professionals, are not clients or alumni, and have not opened a communication or invitation in two to three years. Chances are good these records are not only outdated but also may not be worth the resources it would take to update them. Identify these records and consider removing them from the system. Less mess in your database makes cleanup a bit more manageable.

Your Plan Is Your Life Preserver

Once you’ve prioritized subsets or segments of contacts, identifying and prioritizing your most common data errors can help you decide on the best way to tackle ongoing data cleaning. For example, if you have an important email that needs to be sent to clients, you need to focus on email addresses. Identify records that don’t have an email address, have incorrectly formatted email addresses or have bounced recently.

In addition, if there are contacts you haven’t sent a communication or invitation to for an extended period of time, it’s entirely likely that their email may no longer be valid. It’s important to regularly test emails on your lists because not doing so can cause you to be blacklisted by anti-spam entities or have your account blocked by your eMarketing provider.

Initial Cleaning Cycle

The best place to start your data cleaning cycle is with a contact and list verification and cleansing service such as TrueDQ. This service will evaluate your list data, identify potentially harmful “honeypot” email addresses and even automatically update many of your contacts with current, complete contact information. The data can then also be enhanced with additional missing information, such as industries and locations, to help with targeting and segmenting.

Rinse and Repeat

When one segment or list has been cleaned, move on to the next one – bearing in mind that what’s important on the next list may be different from the last one. For example, maybe you need to send a hard copy postal mailing, so it will be important to ensure the accuracy of physical mailing addresses rather than email addresses.

Bounces and Returns

One of the most common data quality failures at law and other professional services firms is ignoring bounced emails and returned hard copy mailings. Bounces and returns are real-time indicators that can help you keep on top of your data quality. Researching and correcting them is important because sometimes they involve important former clients who could potentially hire the firm again at their new company.

Returned hard mail will often include the forwarding address of the recipient, which should be corrected in your CRM. For emails, use a central email address to collect automatic email replies, since these frequently tell you when a recipient no longer works at an organization.

Ideally, data stewards should regularly review all bounces to take the onus off the professionals. However, it can also be helpful to generate reports on bounced communications and circulate them to professionals or their assistants who may be able to provide updated information – or will at least appreciate knowing which of their contacts have moved on or changed roles.

Finally, if your eMarketing and/or CRM system has a process for automatically isolating bounced records, be sure you have a reciprocal process that automatically reinstates bounced records when the email field is updated.

Prevent Invalid Data

There are multiple ways to encourage good data habits, depending on your system and method of contact entry. If your firm relies on manual data entry, implement a firmwide Data Standards Guide to inform users how data should be entered (e.g., does your firm spell out or abbreviate job titles?). It can also be helpful to use system validation rules wherever possible to require certain information in new records such as last name, city and email address to ensure your contacts are relevant.

Finally, regularly review newly added records for consistency and completeness. This process can reveal issues such as users who may require additional training on contact input best practices. It can also help to catch spam or other potentially dangerous entries that can sometimes flow into your database from online forms that are filled out by bots.

Never, Ever Stop

Just as rivers keep flowing, so does the data in your CRM system – and the data will always need cleaning to ensure that it is fresh. While this may feel like a relentless and burdensome task, never stop – just go with the flow –  because when you’re not regularly cleaning the data, your CRM “river” can become stagnant, and the more polluted it becomes, the longer the eventual cleanup will take.

Article By Christina R. Fritsch JD and Rachel Fields of CLIENTSFirst Consulting

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

© Copyright 2022 CLIENTSFirst Consulting

Now is a Good Time to Confirm Your S Corporation Status

On October 11, 2022, the IRS published Revenue Procedure 2022-19 providing taxpayers with liberalized procedures for resolving common S corporation issues. Previously, taxpayers would have needed costly IRS letter rulings for certainty on their S corporation status. The new procedures are simpler and less expensive.

The IRS has separately assured taxpayers that LLCs that are classified as S corporations may also qualify for this liberalized relief.

Inadvertent loss of S corporation status can have significant tax consequences and can make your business a less attractive acquisition target. For example, an S corporation that reverts to a C corporation may be subject to a double layer of tax going back several years. As a result, potential acquirers of any S corporation invariably request representations on the validity of the S corporation status.

The new Revenue Procedure describes common situations that the IRS has historically treated as not affecting the validity of S corporation status or qualified S corporation Qsub status, such as:

  1. One class of stock requirement in the governing provisions (including the concept that commercial contractual agreements are not treated as binding agreements unless a “principal purpose” of the agreement is to circumvent the one class of stock requirement);

  2. Disproportionate distributions inadvertently creating a second class of stock;

  3. Certain inadvertent errors or omissions on Form 2553 or Form 8869;

  4. Missing administrative acceptance letters for S corporation or Qsub elections;

  5. Federal income tax return filings inconsistent with an S election; or

  6. Governing provisions that allow for non-identical treatment of shareholders, such as differing liquidation rights (allowing for retroactive corrections).

For these common situations, there are now simpler and cheaper procedures to preserve S corporation status. For example, for certain small errors such as missing officer signatures, S corporations may follow the same simplified procedures as the late election relief procedures in Revenue Ruling 2013-30. Those procedures do not require a private letter ruling request, but only the original election form with a reasonable cause statement. As another example, if the issue is non-identical governing provisions and no disproportionate distributions were made, the S corporation may simply be retroactively treated as an S Corporation if it meets certain eligibility requirements and keeps a copy of a signed statement in its files.

Shareholders of uncertain S corporations should consider taking advantage of these new relaxed and cheaper procedures for curing S corporation mistakes. Each different type of error has a different cure with specific requirements.

Article By Christie R. Galinski and Samuel L. Parks of Miller Canfield

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

© 2022 Miller, Canfield, Paddock and Stone PLC

ADA Compliance for Law Firm Websites in 2022

Legal reasoning involves applying the law to the facts to determine the rights and duties of those involved in a situation. Lawyers frequently take the position that the application of rules should settle disputes and that policies will be considered, if at all, only when there is a high degree of uncertainty surrounding the applicability of the rule. The lawyer might take the position that it is always preferable to seek the result that would further the underlying policies, even if that result would be contrary to the clear language of the rules.

But what if no explicit rules currently exist?

That is the issue with website compliance under the Americans with Disabilities Act (ADA). The Act does not offer specific guidelines to follow; however, websites are expected to be easily accessible to everyone, including those who are disabled. The failure to create an ADA-compliant website could expose an organization to discrimination lawsuits, financial liabilities, and severe damage to its reputation.

What is the ADA?

The ADA compels certain businesses, including banks, hotels, restaurants, public transit, law firms, and others to make accommodations for people with disabilities. According to the National Law Review, the Act is divided into three parts:

  • Title I prohibits employers from discriminating against employees based on disability and requires them to provide reasonable accommodation to certain employees under specific circumstances.
  • Title II covers state and local governments.
  • Title III covers “places of public accommodation,” which the ADA does not define, but are generally private businesses or organizations that provide goods, services, facilities, privileges, or accommodations to the public. These places commonly include schools, restaurants, health care providers, social service agencies, law firms, and more.

The ADA is commonly associated with physical locations and the accommodations that certain businesses must make for people with disabilities, which include wheelchair accessibility, reserved parking, and service animals. Companies that fall under ADA Title I and operate 20 or more weeks per year with at least 15 full-time employees, or Title III – those that fall under the category of public accommodation – must be ADA-compliant.

Although physical “brick-and-mortar” locations are nearly always considered places of public accommodation, the debate is ongoing as to whether a business’s website is a place of accommodation. If so, the digital content must be accessible to all users.

A law firm website must be designed so that those who are disabled can access it easily to comply with ADA requirements. While there are no well-defined regulations that describe precisely what an ADA-compliant website should include, businesses that fall under ADA Title I or ADA Title III are required to develop a website that offers “reasonable accessibility” to people with disabilities.

Compliance Tools & Plugins

Because the ADA doesn’t offer specific guidelines for website compliance, many organizations follow the Web Content Accessibility Guidelines 2.0 (WCAG), updated to 2.1 in 2018. While WCAG isn’t a legal requirement, its requirements have been followed in the European Union and other nations since 1999 and still serves as a reference for businesses that want to improve accessibility to their website.

Under WCAG 2.1, website accessibility concerns generally fall into four groups. These include issues that are:

  • Perceivable – issues that affect users’ ability to locate and process the information on a website, e.g., many visually-impaired individuals use screen readers to distinguish between the text and the background to help them navigate online content.
  • Operable – challenges that impair users’ ability to navigate a site, e.g., functions and navigations such as online forms should be accessible via keyboard-only commands, and users who need additional time to complete them should be allowed to do so.
  • Understandable – users should be able to comprehend the information on the site, e.g., error messages that provide an explanation and directions for correcting an error should be offered.
  • Robust – can be interpreted by various devices and platforms according to the varying needs and abilities of users, e.g., the alt text that should pop up to let users know what it is when read by assistive technology when they hover over an image.

Here are more suggestions regarding what to include to help ensure ADA website compliance:

  • “Alt” tags for every media file and map
  • Descriptive HTML tags for online forms
  • Hyperlinks with descriptive anchor text
  • “Skip navigation” links on all website pages
  • Heading tags to organize text
  • Accessible PDF files
  • Subtitles, transcripts, and audio descriptions for videos
  • Accessible fonts for all applications
  • HTML tables with column headers, row IDs, and cell information
  • Captions written in English for audio files
  • Call-to-action buttons with easily accessible names and ARIA labels
  • A website accessibility policy
  • Easy to find contact information

Meeting these guidelines will make a firm’s website more accessible to those with vision or hearing impairments, as well as cognitive, language, or learning disabilities.

Court Rulings Regarding Website ADA Compliance

According to the American Bar Association (ABA), the number of accessibility-related lawsuits filed against websites has increased dramatically in recent years. Plaintiffs are basing these lawsuits on two legal theories:

  1. Title IIIs “equal access and general nondiscrimination mandate
  2. A requirement that places of public accommodation must provide auxiliary aids and services as necessary (for no extra charge)

Although neither Title III nor its regulations mention websites and mobile applications, the phase “auxiliary aids and services” includes “accessible electronic and information technology,” which covers websites and mobile apps.

ADA Title III Lawsuits Filed Each Year Graph
Image by Seyfarth via adatitleiii.com

A recent ABA analysis of court filings related to ADA website compliance found:

  • Federal courts across the country were inundated with more than 8,000 website accessibility lawsuits between 2017 and 2020.
  • In 2020, three states – New York, Florida, and California – brought more than 85 percent of all the ADA website compliance lawsuits.
  • Since 2018, website and mobile app accessibility disputes have accounted for approximately 20 percent of all ADA Title III cases initiated in federal courts, which now regularly exceed 10,000 suits each year.

These statistics do not consider a significant number of website and mobile app cases pursued in state courts, cases settled before filing in court, and DOJ enforcement proceedings that are resolved prior to court filing.

Here are some examples of court rulings related to ADA compliance and websites:

Gil v. Winn-Dixie Stores Inc.

In June 2107, a Florida court ruled in favor of a blind plaintiff who brought an ADA violation lawsuit against Winn-Dixie. The man claimed that aspects of the supermarket chain’s site weren’t compatible with screen readers, leaving him unable to order his medications online or download rewards cards. The trial court agreed that the website was inaccessible to those with impaired vision and ordered that it be brought into compliance with the WCAG 2.0 Level AA.

Although Winn-Dixie complied with the court order, in April 2021, the Eleventh Circuit Court of Appeals overturned the trial court’s decision, finding that Winn-Dixie was not in violation of the ADA because it did not need accessibility aids to conduct business. After that, however, Winn-Dixie posted an accessibility statement on its website that commits to adhere to WCAG 2.0 AA by using testers from the disability community to check the accessibility of their website periodically.

Robles v. Domino’s Pizza

Domino’s Pizza lost a website accessibility lawsuit in 2019 after years of exhaustive litigation when a federal district court in California granted the plaintiff’s motion for summary judgment after it determined that the website was indeed not fully accessible. The court ordered Domino’s to make its website compliant with the WCAG 2.0 to connect customers to the goods and services of Domino’s physical restaurants.

The court held that the ADA applied to Domino’s website and app because the Act requires places of public accommodation, like Domino’s, to offer auxiliary aids and services to make visual materials available to blind individuals. Although customers primarily access the Domino’s website and app outside its physical restaurants, the court found that the Act pertains to the services of public accommodation, not services in a place of public accommodation.

Andrews v. Blick Art Materials

In 2017, Victor Andrews, who is blind, filed a lawsuit against Blick Art Materials for website inaccessibility. Andrews alleged that because Blick’s website was inaccessible, he could not navigate and purchase items on the defendant’s website independently. When Blick made a motion to dismiss the lawsuit, Judge Jack Weisenstein denied it and made this statement:

Today, internet technology enables individuals to participate actively in their community and engage in commerce from the comfort and convenience of their home. It would be a cruel irony to adopt the interpretation of the ADA espoused by Blick, which would render the legislation intended to emancipate the disabled from the bonds of isolation and segregation obsolete when its objective is increasingly within reach.

The ruling in this case and others illustrates that businesses need to consider their websites equivalent to a place of public accommodation, which puts them at risk of being sued, even without explicit web accessibility regulations.

Latest DOJ Guidelines

In 2010, the Department of Justice (DOJ) launched a rulemaking process to address ADA requirements for website accessibility, including technical standards for accessible websites. However, that effort stalled for seven years during the Obama administration (even though the administration continued to pursue investigations and enforcement actions against businesses with inaccessible websites).

The Trump administration abandoned the process to interpret the ADA entirely in 2017. In 2018, the DOJ revealed that it would not give official guidance regarding website accessibility under the Act, releasing this statement:

The Department is evaluating whether promulgating regulations about the accessibility of Web information and services is necessary and appropriate. Such an evaluation will be informed by additional review of data and further analysis. The Department will continue to assess whether specific technical standards are necessary and appropriate to assist covered entities with complying with the ADA.

Since the DOJ’s withdrawal, the number of lawsuits involving website accessibility increased dramatically, raising awareness regarding website accessibility among businesses but also causing confusion surrounding what features an ADA-compliant website should include. As a result, numerous website accessibility consulting companies emerged promising inexpensive solutions. However, some have been challenged in court.

In June 2018, some bipartisan members of the U.S. House of Representatives sent a letter to Attorney General Jeff Sessions encouraging the DOJ to release clear website accessibility regulations to diminish the unclear nature of current legislation. On September 25, 2018, the DOJ responded by stating that, at this time, the DOJ would not be issuing web accessibility regulations under the ADA: “The Department has consistently taken the position that the absence of a specific regulation does not serve as a basis for noncompliance with a statute’s requirements.”

In March 2022, the DOJ issued further web accessibility guidance under the ADA. The “new” guidance references both the WCAG – which are voluntary – and Section 508 standards, which set standards for federal websites, and indicates that the DOJ supports the notion that sites of public accommodation must be accessible, and in the absence of explicit regulations, websites can be flexible in how they choose to comply with the ADA’s requirements. However, the guidance does not clarify what such flexibility or choice entails and– not necessarily the direction regulation-seekers are looking for, since it provides no substantially new information regarding the vagueness of website accessibility requirements under the ADA.

Final Thoughts

As accessibility regulations for websites remain unclear, it can be easy for organizations to assume that they cannot be sued for noncompliance. However, with no specific standards to follow, law firms and other businesses must do their best to interpret the ADA, practice website accessibility as they see fit, and try to avoid website accessibility-related lawsuits.

One more thing to consider: ambiguity runs both ways, and even though an organization might think its website is accessible, a disabled person might think otherwise, providing the grounds for a lawsuit. Organizations aren’t granted immunity simply because of a lack of clarity in legislation. Instead, uncertainty allows for interpretation by anyone, including the courts.

This article was authored by Jan Hill of Lawmatics.

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

©2022 — Lawmatics

U.S. Fish & Wildlife Service Proposes New Regulations Creating General Eagle “Take” Permits for Certain Wind Energy and Power Line Infrastructure Projects

The U.S. Fish and Wildlife Service recently published a proposed rule revising regulations that authorize permit issuance for eagle incidental take and eagle nest take under the Bald and Golden Eagle Protection Act (the “Act”). In addition to retaining the individual permits already available under the Act, the new rule proposes creation of a “general” permit for qualifying wind energy and power line infrastructure projects.

The Act generally prohibits the “take,”[1] possession, and transportation of bald eagles and golden eagles, except pursuant to federal regulations. However, the Act also authorizes the Secretary of the Interior to issue regulations to permit the take of these eagle species for various purposes. Under the current regulations, there are 2 permit types for the incidental take of eagles and eagle nests, which are issued on an individual, project-specific basis. Due, in part, to inefficiencies in the application review and approval process, issuance of these project-specific eagle take permits has – historically – been relatively rare. The Service acknowledges that, while participation in the permit program by wind energy projects has increased since 2016, it still remains well below the Service’s expectations.

According to the Service, the purpose of the new regulations is to: (i) increase the efficiency and effectiveness of permitting; (ii) facilitate and improve compliance with the regulations; (iii) and increase the conservation benefit for eagles. The Service proposes to do this by creating a general permit program to streamline the permitting process and provide more timely and cost-effective coverage for affected industries.

General permits would be available to authorize incidental take by activities that occur frequently enough for the Service to have developed a standardized approach to permitting. Specifically, the Service proposes activity-specific eligibility criteria and permit requirements in 4 new sections based on activity and type of take: (i) incidental eagle take for permitting wind energy; (ii) incidental eagle take for permitting power lines; (iii) bald eagle disturbance take; and (iv) bald eagle nest take. As part of the revised application process, a general permit applicant would self-identify as eligible and register with the Service. The applicant is then required to submit an application containing all requested information and fees, as well as certification that the applicant meets the eligibility criteria and would implement permit conditions and reporting requirements.

Two particular proposed general permits – for wind energy and power line projects – could prove particularly useful for renewable energy developers.

Wind Energy Projects

The core general permit eligibility criterion for wind energy projects would be a relative eagle abundance threshold, which a project would need to be below in order to qualify for a general permit. The proposed rule includes specific abundance thresholds for bald and golden eagles, applicable during 5 defined portions of the year. For project eligibility, seasonal bald or golden eagle abundance at all existing or proposed turbine locations must be lower than all 5 seasonal thresholds listed. Presently, the Service estimates that nearly 80% of all existing wind-energy turbines in the coterminous United States are located in areas under the proposed relative abundance thresholds for both species and thus eligible for a general permit under this proposal. The Service plans to offer publicly available online mapping resources depicting areas that qualify. However, at this time, we note that under the proposed rule, Alaska would be excluded from the general permitting program.

In addition to falling below the relative eagle abundance thresholds, wind energy projects would also need to be sited more than 660 feet from bald eagle nests and more than 2 miles from golden eagle nests to be eligible for a general permit.

For existing projects where not all turbines are located within an area below the designated thresholds of relative abundance, the project operator would need to apply for an individual permit and request consideration for a general permit in the application. The Service would review the project and issue a letter of authorization if it determines it is “appropriate” to extend general permit coverage.

Although the Service has not yet promulgated a complete set of conditions for wind energy project general permits, the proposed rule requires permittees to implement all practicable avoidance and minimization measures to reduce the likelihood of take. Permittees would also be subject to a 4 discovered-eagle permit condition, under which discovery of 4 eagle mortalities at a wind energy project covered by a general permit would prohibit the project from reapplying for additional 5-year general permits. Such a project would have to apply for an individual permit.

Power Lines

In the proposed rule, the Service acknowledged that it has sufficient understanding of how eagles interact with power lines to develop a general permit for eagle take resulting from power-line infrastructure.

While the proposed rule does not include detailed eligibility criteria, the Service contemplates 6 key conditions for the new power line general permit:

  1. All new construction and reconstruction of pole infrastructure must be electrocution-safe for bald eagles and golden eagles, except as limited by human health and safety.
  2. All new construction and reconstruction of pole infrastructure must be electrocution-safe for bald eagles and golden eagles, except as limited by human health and safety. All new construction and reconstruction of transmission lines must consider eagle nesting, foraging, and roosting areas in siting and design, as limited by human health and safety. Specifically, the Service recommends siting utility infrastructure at least 2 miles from golden eagle nests, 660 feet from a bald eagle nest, 660 feet from a bald eagle roost, and 1 mile from a bald eagle or golden eagle foraging area.
  3. A reactive retrofit strategy must be developed that governs retrofitting high-risk poles when an eagle electrocution is discovered. A reactive retrofit strategy responds to incidents in which eagles are killed or injured by electrocution.
  4. A proactive retrofit strategy must be developed and implemented to convert all existing infrastructure to be electrocution-safe, prioritizing poles identified as the highest risk to eagles.
  5. A collision-response strategy must be implemented for all eagle collisions with power lines. If an eagle collision is detected, a strategy must outline the steps to identify and assess the collision, consider options for response, and implement a response.
  6. An eagle shooting response strategy must be developed and implemented when an eagle shooting is discovered near power-line infrastructure.

Service review and approval would not be required prior to obtaining coverage under either of these general permits. Rather, according to the Service, the general permit authorization would be “generated” using permit conditions and reporting requirements for the proposed activity. Under the proposed rule, upon submitting an application, the Service will “automatically issue a general permit to authorize the take requested in the application.”

The Service intends to conduct annual audits for a small percentage of all general permits to ensure applicants are appropriately interpreting and applying eligibility criteria. The maximum term for wind energy and power line project general permits would be 5 years; after expiration, with certain narrow exceptions, projects could reapply for new 5-year general permits.

Finally, because the Service will undertake environmental review to support its final rule, obtaining coverage under the general permits would not require project-specific environmental review under the National Environmental Policy Act. However, applicants for the general permit must certify, among other things, that: (i) the activity for which take is to be authorized does not affect a property that is listed, or is eligible for listing, in the National Register of Historic Places; or (ii) that the applicant has obtained, and is in compliance with, a written agreement with the relevant State Historic Preservation Officer or Tribal Historic Preservation Officer that outlines all measures the applicant will undertake to mitigate or prevent adverse effects to the historic property.

The Service is accepting comments on the proposed rule until November 29, 2022. The Service hosted an initial listening session for the general public on October 20th, and will host an additional listening session on November 3, 2022.

FOOTNOTES

[1]Under the federal Endangered Species Act, “take” is defined as any action “to harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect, or to attempt to engage in any such conduct.”

Article By S. Keith Garner and Daniel S. Maroon of Sheppard, Mullin, Richter & Hampton LLP

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

Copyright © 2022, Sheppard Mullin Richter & Hampton LLP.

Employers, It’s Time to Replace Your Mandatory EEOC Poster

On October 20, 2022, the U.S. Equal Employment Opportunity Commission (EEOC) released an updated version of its mandatory workplace poster that informs employees of their rights and protections.

Employers must post this new version of the poster in their office spaces as soon as practicable.

The latest “Know Your Rights” flyer, which replaces the previous “EEO is Law” poster, must be displayed in all workplaces covered by the agency’s jurisdiction. This includes private sector businesses with 15 or more employees, as well as state and local government agencies, educational institutions, unions, and staffing agencies.

What’s Changed?

The new poster includes several updates from the older version. Some of the main changes are:

  • Clarification that sex discrimination includes discrimination based on pregnancy and related conditions, sexual orientation, or gender identity;
  • Identifies harassment as a prohibited form of discrimination;
  • Provides information about equal pay discrimination for federal contractors; and
  • Uses more straightforward language and formatting.

The poster also includes a QR code for employees with a smartphone or other compatible devices to quickly access the EEOC’s website on how to file a charge of employment discrimination.

What’s Remained the Same?

While the poster has been updated, some of the information included remains the same. The bulletin still outlines the types of discrimination that are prohibited by federal law, such as:

  • Race, color, sex (including pregnancy and related conditions, sexual orientation, or gender identity), national origin, religion,
  • Age (40 and older),
  • Equal pay,
  • Disability,
  • Genetic information (including family medical history or genetic tests or services), and includes
  • Retaliation for filing a charge, reasonably opposing discrimination, or participating in a discrimination lawsuit, investigation, or proceeding.

Actions Employers Should Take

Employers who fail to post the new Know Your Rights poster could face noncompliance penalties from the EEOC. Therefore, businesses must take the time to update their posters as soon as possible.

On October 25, 2022, the EEOC distributed an FAQ stating that employers should remove the old poster and display the new one “within a reasonable amount of time” but did not provide a specific deadline.

The agency recommends that employers post the new flyer in a conspicuous place where employees will see it, such as in a break room or near the time clock.  Covered employers should also consider posting an online notice on their website for remote or hybrid workers.

You can download a copy of the poster here.

Article By Emily G. Massey and Ward and Smith, P.A.

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

© 2022 Ward and Smith, P.A.. All Rights Reserved.

Actual Malice in the Age of #fakenews

Public figures are fighting back against fake news.

In the most recent headline from the world of celebrity defamation cases, E. Jean Carroll is suing former President Trump for statements he made after she accused him of sexual assault. In a 2019 book and excerpt in New York magazine, Carroll, a longtime advice columnist for Elle magazine, accused Trump of sexual assault in the mid-1990s. Trump responded that Carroll was “totally lying” and not his “type.” Carroll sued Trump for defamation, claiming his statements had harmed her reputation. But Carroll—like all public figure defamation plaintiffs—has an uphill battle before her. To succeed, Carroll will have to prove that Trump’s statements were false, and—because Carroll is a public figure—she will also have to show that Trump acted with “actual malice.” The actual malice standard often proves to be too high a threshold for most public figures to cross, and most cases are lost on that prong—regardless of whether the statement was false. In fact, Johnny Depp was one of the few public figures in recent years to win a defamation suit.

So, what would it mean if the actual malice requirement was rescinded?

The seminal decision in New York Times Company v. Sullivan and its progeny are the backbone of defamation law in this country. These cases hold that public officials and public figures claiming defamation must prove that the allegedly defamatory statement was made, “with knowledge that it was false or with reckless disregard of whether it was false or not.” In other words, with “actual malice.” On the other hand, a private figure, or one who has not sought out the limelight, need only show the false statement was made negligently. Prior to Sullivan, all plaintiffs fell under the negligence standard.

Public figures who must meet this “actual malice” standard fall into two categories: (1) all-purpose public figures, with “pervasive fame or notoriety,” like Johnny Depp; and (2) limited-purpose public figures, like Carroll, who, in the words of Gertz v. Robert Welch, Inc., achieve their status by “thrust[ing] themselves to the forefront of particular public controversies in order to influence the resolution of the issues involved.” The Court rationalized that both categories of public figures have “invite[d] attention and comment.” Moreover, because “public figures enjoy “greater access to the channels of effective communication” than private individuals, they are better able to “contradict the lie or correct the error.”

In today’s age of social media, do these justifications still hold true? When Sullivan and its progeny came down, there was a clear delineation between public and private figures. Typically, public figures had media access, and private figures did not. Today’s social media landscape muddles that line. We are all just one post, tweet, or TikTok away from becoming public figures.

In 2019, in a case strikingly similar to Carroll’s, the Supreme Court declined to review a defamation case filed by Kathrine McKee against Bill Cosby. In 2014, McKee publicly accused Cosby of forcibly raping her 40 years earlier. In response, Cosby’s attorney authored and subsequently leaked an allegedly defamatory letter. Excerpts of the letter were disseminated via the Internet and published by news outlets around the world. McKee argued that the letter deliberately distorted her personal background to “damage her reputation for truthfulness and honesty, and further to embarrass, harass, humiliate, intimidate, and shame” her. Applying Sullivan and its progeny, the Court concluded because McKee had “‘thrust’ herself to the ‘forefront’” of the public controversy over “sexual assault allegations implicating Cosby,” she was a “limited-purpose public figure” who needed to show actual malice—regardless of whether the statements about her were false.

In a lone dissent, Justice Clarence Thomas noted that “in an appropriate case, [the Court] should reconsider the precedents” requiring public figures to satisfy an actual-malice standard. Justice Thomas later double-downed on his proffer in his dissents in Berisha v. Lawson, and most recently in Coral Ridge Ministries Media, Inc. v. Southern Poverty Law Center. In Berisha, pointing to the shift in the media landscape since Sullivan, Justice Neil Gorsuch joined Justice Thomas in calling to review the Sullivan decision, noting our new media world “facilitates the spread of disinformation.”

According to these Justices, in recent years Sullivan has become less of a shield and more of a sword. The “actual malice” standard allows spreaders of conspiracy theories, false accusations, and fake news to be virtually untouchable. In an era where misinformation spreads like wildfire, has the actual malice standard allowed journalists to become sloppy and irresponsible? Under this legal standard a journalist is better off printing a story without fact-checking. In fact, failing to thoroughly investigate, standing alone, does not prove actual malice. If the Court abolished that standard, public figures would be like every other defamation plaintiff and would only need to show that the false statement was made carelessly. In other words, instead of the defendant knowingly printing misinformation, a plaintiff would only need to show that the defendant didn’t bother checking if the information was true or false before making it.

Under this precedent, for years reporters, and individuals alike have been shielded from consequences of publishing falsehoods about public figures. Removing the “actual malice” standard would have sweeping effects on journalists and news platforms, and would make reputable news organizations more vulnerable to attack and open to further scrutiny. But responsible journalists would still remain protected. Truth remains an absolute defense to a defamation claim.

Between 2018 and 2020 the number of defamation suits filed increased by 30%. With “fake news” on the rise, more individuals falling into the “public figure” category, and technology moving at warp speed, the Court may have no choice but to rethink Sullivan. While it is unlikely that that 50 years of settled precedent would be overturned, Sullivan just might, at the very least, be revisited.

Article By Melissa Sarsten Polito of Epstein Becker & Green, P.C.

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

©2022 Epstein Becker & Green, P.C. All rights reserved.

Feds Announce More Aggressive Enforcement of Poor Performing Nursing Homes

In February of 2022, during his State of the Union Address, President Biden announced an action plan to improve the safety and quality of care in the nation’s nursing homes.[i] On October 21, 2022, Centers for Medicare and Medicaid Services (CMS) announced new requirements to help with oversight of facilities selected to the Special Focus Facilities (SFF) Program.[ii]

The SFF Program was created to help and oversee the poorest performing nursing homes in the country and improve nursing homes that have a history of noncompliance.  The goal is to improve safety and quality of care. The facilities selected for the SFF Program must be inspected no less than once every six months and if severe enforcement is needed, it is at the discretion of the state surveyors. The main objective for the SFF Program is for facilities to show exponential improvement, graduate from the program, and then maintain compliance and better quality of care and safety.

The new CMS requirements, outlined below, are aimed at facilities that continuously fail to improve and remain in the SFF Program for a prolonged period of time. Health and Human Services Secretary Xavier Becerra stated, “Let us be clear: we are cracking down on enforcement of our nation’s poorest-performing nursing homes. As President Biden directed, we are increasing scrutiny and taking aggressive action to ensure everyone living in nursing homes gets the high-quality care they deserve. We are demanding better because our seniors deserve better.”

CMS announced the following revisions to the SFF Program:

  • Effective immediately, CMS will use escalating penalties for violations for deficiencies cited at the same level in subsequent surveys. This can include possible discretionary termination from Medicare and/or Medicaid funding for facilities that are cited with immediate jeopardy deficiencies on any two surveys while participating the in the SFF Program.
  • CMS will consider facilities’ efforts to improve when considering discretionary termination from Medicare and/or Medicaid programs.
  • CMS will impose more severe escalating enforcement remedies for SFF Program facilities for noncompliance and no effort to improve performance.
  • Increased requirements that nursing homes in the SFF Program must meet to graduate from the SFF Program.
  • For three years after graduation from the SFF Program, CMS will ensure nursing homes consistently maintain compliance with safety requirements by continuing to closely monitor these facilities.
  • CMS is offering more support resources to facilities selected for the SFF Program.

Additionally, the Biden administration released a fact sheet with the steps they are taking to in improve the quality of nursing homes. [iii] Some of the steps mentioned include more resources to support union jobs in nursing home care, establishing minimum staffing requirements, incentivizing quality performance through Medicare and Medicaid funding, and enhanced efforts to prevent fraud and abuse.

  1. https://www.whitehouse.gov/briefing-room/statements-releases/2022/02/28/…
  2. https://www.cms.gov/files/document/qso-23-01-nh.pdf
  3. https://www.whitehouse.gov/briefing-room/statements-releases/2022/10/21/…

Article By Thomas W. Hess, Kelly A. Leahy, Sydney N. Pahren, and Bryan L. Cockroft of Dinsmore & Shohl LLP

For more health law and managed care legal news, click here to visit the National Law Review.

© 2022 Dinsmore & Shohl LLP. All rights reserved.

Is The End Of FINRA Drawing Nigh?

The Financial Industry Regulatory Authority, aka FINRA, is a non-profit Delaware corporation.  It was formed in 2007 by the combination of the National Association of Securities Dealers, Inc. and the regulatory arm of the New York Stock Exchange, Inc.  FINRA is a self-regulatory organization that primarily regulates securities broker-dealers.

Professor Benjamin P. Edwards recently reported that a complaint has been filed in Florida challenging the constitutionality of FINRA.  The lawsuit filed by two broker-dealers alleges:

However, FINRA’s current structure and operations, particularly in light of the transformation of the organization over the course of the last two decades, contravene the separation of powers, violate the Appointments Clause of the United States Constitution (the “Constitution”) and constitute an impermissible delegation of powers. Because it purports to be a private entity, FINRA is unaccountable to the President of the United States (the “President,” or “POTUS”), lacks transparency, and operates in contravention of the authority under which it was formed.  It utilizes its  own in-house tribunals in a manner contrary to Article III and the Seventh Amendment of the Constitution and deprives entities and individuals of property
without due process of law.

The plaintiffs are seeking, among other things, declaratory and injunctive relief.

For more Finance Legal News, click here to visit the National Law Review

© 2010-2022 Allen Matkins Leck Gamble Mallory & Natsis LLP

Chamber of Commerce Challenges CFPB Anti-Bias Focus Concerning AI

The end of last month the U.S. Chamber of Commerce, the American Bankers Association and other industry groups (collectively, “Plaintiffs”) filed suit in Texas federal court challenging the Consumer Financial Protection Bureau’s (“CFPB”) update this year to the Unfair, Deceptive, or Abusive Acts or Practices section of its examination manual to include discrimination.  Chamber of Commerce of the United States of America, et al v. Consumer Financial Protection Bureau, et al., Case No. 6:22-cv-00381 (E.D. Tex.)

By way of background, the Consumer Financial Protection Act, which is Title X of the 2010 Dodd-Frank Act (the “Act”), prohibits providers of consumer financial products or services or a service provider from engaging in any unfair, deceptive or abusive act or practice (“UDAAP”).  The Act also provides the CFPB with rulemaking and enforcement authority to “prevent unfair, deceptive, or abusive acts or practices in connection with any transaction with a consumer for a consumer financial product or service, or the offering of a consumer financial product or service.”  See, e.g., https://files.consumerfinance.gov/f/documents/cfpb_unfair-deceptive-abusive-acts-practices-udaaps_procedures.pdf.  In general, the Act provides that an act or practice is unfair when it causes or is likely to cause substantial injury to consumers, which is not reasonably avoidable by consumers, and the injury is not outweighed by countervailing benefits to consumers or to competition.

The CFPB earlier this spring published revised examination guidelines on unfair, deceptive, or abusive acts and practices, or UDAAPs.  Importantly, this set forth a new position from the CFPB, that discrimination in the provision of consumer financial products and services can itself be a UDAAP.  This was a development that was surprising to many providers of financial products and services.  The CFPB also released an updated exam manual that outlined its position regarding how discriminatory conduct may qualify as a UDAAP in consumer finance.  Additionally, the CFPB in May 2022 additionally published a Consumer Financial Protection Circular to remind the public of creditors’ adverse action notice requirements under the Equal Credit Opportunity Act (“ECOA”).  In the view of the CFPB, creditors cannot use technologies (include algorithmic decision making) if it means they are unable to provide required explanations under the ECOA.

In July 2022, the Chamber and others called on the CFPB to rescind the update to the manual.  This included, among other arguments raised in a white paper supporting their position, that in conflating the concepts of “unfairness” and “discrimination,” the CFPB ignores the Act’s text, structure, and legislative history which discusses “unfairness” and “discrimination” as two separate concepts and defines “unfairness” without mentioning discrimination

The Complaint filed this fall raises three claims under the Administrative Procedure Act (“APA”) in relation to the updated manual as well as others.  The Complaint contends that ultimately it is consumers that will suffer as a result of the CFPB’s new position, as “[t]hese amendments to the manual harm Plaintiffs’ members by imposing heavy compliance costs that are ultimately passed down to consumers in the form of higher prices and reduced access to products.”

The litigation process started by Plaintiffs in this case will be time consuming (a response to the Complaint is not expected from Defendants until December).  In the meantime, entities in the financial sector should be cognizant of the CFPB’s new approach and ensure that their compliance practices appropriately mitigate risk, including in relation to algorithmic decision making and AI.  As always, we will keep you up to date with the latest news on this litigation.

For more Consumer Finance Legal News, click here to visit the National Law Review

© Copyright 2022 Squire Patton Boggs (US) LLP

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