Dallas Bar Association
HEADNOTES
Focus Health Law & Employee Benefits/Executive Compensation
July 2015 Volume 40 Number 7
Rod Phelan: Trial Lawyer of the Year by Meghan Hausler
“I would rather watch a closing argument than a Cowboys game or Duke basketball,” Rod Phelan confessed, confirming the merits of his selection as the 2015 Dallas Bar Association’s Trial Lawyer of the Year. Mr. Phelan, a partner at Baker Botts, has been practicing as a commercial trial lawyer for over 40 years, in which time he has built a reputation as a smart, tenacious and hardworking litigator who gives his all for his clients. “Rod is as deserving an honoree as there has ever been for this award,” said Tom Melsheimer, last year’s award recipient. Jim Coleman describes Mr. Phelan as both a “superb lawyer” and a “kind, good human being.” During his career, Mr. Phelan has received countless honors, including being named a “Trial Leg- Rod Phelan end” by the DBA Torts & Insurance Practice Section in 2014. He has been recognized as a Top 100 Texas Lawyer, Texas Super Lawyer and Best Lawyer in Dallas every year since each list’s inception. He has been included as one of the Best Lawyers in America every year for the past 20 years. Mr. Phelan was also profiled in Chambers USA from 2004 to 2014 and in Chambers Global from 2004 to 2005 and 2010 to 2015. He is a fellow of the American College of Trial Lawyers, the International Academy of Trial Lawyers and the International Society of Barristers. He was Dallas Chapter President of the American Board of Trial Advocates in 2010. He is also a Master in the Patrick E. Higginbotham Inn of Court. Mr. Phelan’s path to becoming a successful trial lawyer started in an unusual place—Sports Illustrated magazine. During his senior year at Vanderbilt University, Mr. Phelan contacted the magazine about a job as a “stringer,” pulling news stories off the wires and delivering them to writers. He learned that the position paid $5,000 a year. Instead of pursuing that job and a career as a journalist after graduating cum laude from Vanderbilt, Mr. Phelan went to law school at Duke University School of Law. Shortly after graduating law school cum laude, he started work at the firm now known as Carrington, Coleman, Sloman & Blumenthal—making $14,400 a year—enough to pay his $5,000 of law school debt in his first year as a lawyer. He joined Baker Botts in 1987. Since then, Mr. Phelan has never looked back. He has developed a well-rounded practice encompassing many types of litigation, including professional malpractice, intellectual property and shareholder litigation. Patrick Long describes him as both a “’big brain’ litigator who can constantly excel in analyzing and handling complex issues in commercial litigation” and a trial lawyer with “folksy charm that makes him deadly effective with jurors.” According to Mr. Long, this unique combination of talents “is why some of the best law firms in the world turn to Rod when they have been sued.” Over the years, Mr. Phelan has tried cases before judges, juries and arbitration panels. His success in all of these areas has made him known in the legal community as a fearless and well-prepared advocate. He is an “aggressive,” “tough-as-nails” litigator, according to Mr. Coleman. Mr. Melsheimer concurred,
“He strikes hard blows, but never foul ones.” George Bramblett, who litigated against Mr. Phelan in his first solo jury trial, said, “He’s fearless and thrives on difficult, complex cases. I want him on my side.” Mr. Phelan believes that in order to be a successful litigator “being competitive is first. If you don’t want to win, you won’t. And if you do, you’ll do the work it takes.” This attitude is apparent to those who know him. “He works tirelessly, and if you are with him or against him, you are likely to get emails at all hours of the day or night. . . . That kind of behavior has two different effects. When he is your opponent, you know you better pack a lunch. When he is on your side, you feel like you can’t lose,” said Mr. Melsheimer. After litigating against Mr. Phelan, Mr. Long agrees: “To make matters worse for opposing lawyers, Rod’s talent is magnified by his tireless work ethic.” Mr. Phelan recognizes several mentors for guiding him during his career. He credits Bob Blumenthal with teaching him “how to think like a lawyer.” He describes Fletcher Yarbrough as a hero. And Mr. Coleman “is in all things and in all ways inspirational.” Mr. Phelan describes his own mentoring style simply as “watch this!” He recommends that young lawyers watch and learn from the experienced attorneys they work with, as well as other members of the bar that they have an opportunity to interact with and observe. He also advises more seasoned attorneys not to hold back in their mentoring: “[T]ell them what you’re doing and why, and what they’re doing right and wrong. For me, trying to be sure to praise what’s right is the hard part.” Although Mr. Phelan has built an impressive career and a reputation amongst his peers as an outstanding litigator and advocate, he insists that his favorite trial memories are of watching others. He loves observing trials and closing arguments, and he has high praise for other members of the bar: “About 25 years ago, I nearly cried watching John Hill close in a death case. Tom Melsheimer made the best closing argument I have ever heard, for Mark Cuban in the insider trading case.” In keeping with his advice to more junior members of the bar, Mr. Phelan has gleaned useful insight from his observations of other litigators: “Roy Minton and Jim Coleman made me realize it’s OK to talk like a regular person, without big words, but with conviction. Steve Susman taught me it’s OK to look organized. And David Beck and George Bramblett made it plain that passion matters—turn it loose!” Litigators across Dallas agree that Mr. Phelan is himself worthy of the praise he so generously bestows on others. Mr. Long praised Mr. Phelan as a “unique talent.” Mr. Melsheimer noted that Rod is not only “quick on his feet and a compelling advocate” but also “writes beautifully and memorably.” Mr. Bramblett said “He’s very simply the best.” By all accounts, Mr. Phelan is an outstanding litigator and an asset to the Dallas Bar Association. Congratulations to Mr. Phelan on this well HN deserved award. Meghan Hausler is an associate at Baker & McKenzie LLP and is Co-Chair of the DBA Publications Committee. She can be contacted at meghan. hausler@bakermckenzie.com.
Inside
3 Pension Plan Buyout Offers
7 Fly Ball! ERISA and Fly Ball Communication
10 Bar None XXX: Obscenely Funny 13 A New Era of Med-Mal Arbitration?
Insights From Corporate Counsel
On May 27, the Dallas Minority Attorney Program presented “Insights from Corporate Counsel: From Developing Business to Going In-House. Panelists included (left to right) Bipasha Mukherjee, Cinemark; Alan Dorantes, AT&T; Victor Corpuz, Jackson Lewis LLP, DMAP Chair; Rudy Rodriguez, Jr., CEC Entertainment; Stephanie Zapata Moore, Luminant; and Crystal Moore, Methodist Health System.
Focus
Healthcare
Audits Conducted by Medicare by Richard Cheng
Medicare accounts for approximately 16 percent of the total federal budget. As such, regulatory scrutiny by the Centers for Medicare and Medicaid Services (CMS) has gradually increased. With datamining practices by federal auditors, it is imperative for providers (and their legal counsel) to possess a strong understanding of the different types of Medicare audits.
Additional Development Requests (ADRs)
The Medicare Administrative Contractor (MAC) is the frontline contractor in the Medicare regulatory framework. The MAC, created by the Medicare Prescription Drug Improvement and Modernization Act of 2003, is designed to process, pay and ensure accuracy of Medicare payments. MACs send ADRs to providers in order to gather information necessary to assess proper documentation associated with Medicare claims. Providers are given 45 days to respond
to the ADR, though the MAC has discretion to grant extensions for responding if “good cause” is shown. The MAC must make a payment determination within 60 days of receipt of documentation from the provider and has authority to deny payment for minor errors or omissions. The MAC is tasked with minimizing losses to the Medicare Trust Fund and to remedy issues with providers. Specifically, CMS instructs MACs to use penalties to remedy repeated infractions. As such, a provider’s compliance should include periodic audits of billing and documentation practices.
Comprehensive Error Rate Testing (CERT)
CMS uses CERTs to evaluate MACs’ processing to determine its accuracy with payment. The CERT also uses its gathered information to estimate the national Medicare fee-for-service improper payment rate. When CERTs are continued on page 9
The 2015 DBA Membership Directory is now available in print & online. Check out the directory and legal resource guide used by Dallas attorneys! To view the Online Directory and Legal Resource & Expert Witness Guide, go to www.dallasbar.org/pictorial and login. To request a copy of the new directory, contact pictorial@dallasbar.org.
2 He a d n o t e s l D a l l a s B a r A s s o ciation
Jul y 2015
Calendar July Events FRIDAY CLINICS
JULY 10-NORTH DALLAS** Noon
“What to Do When Outside Counsel Loses Control of Your Case,” Heath Cheek. (MCLE 1.00)* At Two Lincoln Centre, 5420 Lyndon B. Johnson Frwy., Ste. 240, Dallas, TX 75240. Parking is available in the Visitor’s Lot located in front of the entrance to Two and Three Lincoln Centre. There are several delis within the building. Food is allowed inside the Conference Center. Thank you to our sponsor Fox Rothschild LLP. RSVP to kzack@dallasbar.org.
WEDNESDAY, JULY 1 Noon
DAYL Judiciary Committee
J.L. Turner Legal Association
Criminal Justice Committee
5:30 p.m. Bankruptcy & Commercial Law Section “Game of Thrones Rules: A Discussion of the Local Bankruptcy Rules of the Northern District of Texas,” Stephen Manz, Laurie Dahl Rea, Laura Smith and Paul Lopez, moderator. (MCLE 1.00)*
THURSDAY, JULY 2 Noon
Publications Committee
Christian Lawyers Fellowship
6:00 p.m. J.L. Turner Legal Association
FRIDAY, JULY 10 Noon
Family Law Section Board Meeting
FRIDAY, JULY 3
DBA & Belo offices closed in observance of Independence Day
MONDAY, JULY 6 No DBA events Scheduled
TUESDAY, JULY 7 Noon
Tort & Insurance Practice Section “Top Trends in Texas Insurance Law,” Micah Skidmore. (MCLE 1.00)* Morris Harrell Professionalism Committee
6:00 p.m. DAYL Board of Director’s Meeting
11:30 a.m. House Committee Walk Through Noon
Family Law Section “The Elements of a CPS Investigation,” Gauthami Vemula & Zee Powell. (MCLE 1.00)*
Solo & Small Firm Section “There are Traps in the TRAPs: What You Need to Know to Handle an Appeal,” Chad Ruback. (MCLE 1.00)*
Bench Bar Conference Committee
DAYL ACE Committee
Dallas Asian American Bar Association
Minority Clerkship Luncheon Panelists include Jonathan Childers, Rocio Garcia, Bill Richmond, Ebony Rivon, Hon. Roberto Cañas, moderator. Learn about the broad range of opportunities in Dallas. RSVP to bavina@dallasbar.org. DAYL Freedom Run Committee
Noon
Alternative Dispute Resolution Section “The Dispute Resolution Center: Mediation Tips and Traps from the Field,” Othel Bursey. (MCLE 1.00)*
Real Property Law Section “Top Environmental Litigation Issues that Every Real Estate Attorney Should Know,” Michael R. Goldman. (MCLE 1.00)*
Peer Assistance Committee
TUESDAY, JULY 14
5:15 p.m. Legalline. Volunteers welcome. Second floor Belo.
THURSDAY, JULY 9
Friday Clinic—North Dallas** “What to Do When Outside Counsel Loses Control of Your Case,” Heath Cheek. (MCLE 1.00)* At Two Lincoln Centre, 5420 Lyndon B. Johnson Frwy., Ste. 240, Dallas, TX 75240. Parking is available in the Visitor’s Lot located in front of the entrance to Two and Three Lincoln Centre. There are several delis within the building. Food is allowed inside the Conference Center. Thank you to our sponsor Fox Rothschild LLP. RSVP to kzack@ dallasbar.org.
MONDAY, JULY 13
WEDNESDAY, JULY 8
Noon
Visit www.dallasbar.org for updates on Friday Clinics and other CLEs.
Judiciary Committee “Effective Trial Preparation: Views from the Bench and Bar,” Hon. Phyllis Lister Brown, Hon. Jane Boyle, Hon. Martin Hoffman, Eric Pinker and Daniel Tobey, moderator. (MCLE 1.00)*
Noon
Business Litigation Section “Current Issues in Motions to Disqualify and Conflict of Issues Law,” Dan Boyd. (Ethics 1.00)*
DAYL Lawyers Promoting Diversity Committee
J.L. Turner Legal Association Presidential Series
WENDESDAY, JULY 15 Noon
Energy Law Section “Pipelines – The Legal of Who, What, When, Where, and How,” Vince Murchison. (MCLE 1.00)*
Health Law Section “Physician Employment and Non-Competes: What Does Taking the Plunge Really Mean,” Karin Zaner. (MCLE 1.00)*
Non-Profit Law Study Group
5:15 p.m. Legalline. Volunteers welcome. Second floor Belo.
THURSDAY, JULY 23 Noon
Criminal Law Section Topic Not Yet Available
Environmental Law Section “Review and Discussion of 84th Texas Legislature (2015),” Martha K. Landwehr. (MCLE 1.00)*
DBA Community Service Fund Board of Directors Meeting
THURSDAY, JULY 16 Noon
Franchise & Distribution Section “Recent Developments and Case Law Update,” Sarah Walters, Jason Binford, Laura Hayes, Jacob King and Sarah Walters. (MCLE 1.l00)*
Media Relations Committee
Minority Participation Committee
DAYL Animal Welfare Committee
Christian Legal Society
Dallas Gay & Lesbian Bar Association
FRIDAY, JULY 24
9:00 a.m. Christmas in July Donation Drop Off Noon
FRIDAY, JULY 17
11:30 a.m. SOLD OUT! Inspiring Women: Humor & War Stories to Reach the Top of Your Game. Panelists: Monica Brown, Ophelia Camiña, Stacey Doré , Hon. Susan Hawk, Allyson Ho, Hon. Margaret Keliher and Hon. Karen Gren Scholer. (Ethics 1.00)* Noon
DAYL Lawyers Against Domestic Violence Committee
MONDAY, JULY 20 Noon
Labor & Employment Law Section “Intellectual Property Issues for the Labor and Employment Attorney,” Bobby Braxton, Zach Hilton and Greg Perrone. (MCLE 1.00)* Senior Lawyers Committee
TUESDAY, JULY 21 Noon
Antitrust & Trade Regulation Section “Recent Antitrust & Trade Regulation Cases,” Kim Van Winkle. (MCLE 1.00)*
International Law Section “A Comparison of Leading Arbitral Institutions Outside the U.S.,” Matt Christensen. (MCLE 1.00)*
Community Involvement Committee
Entertainment Committee
Dallas Bar Foundation Board Meeting
DAYL Elder Law Committee
WEDNESDAY, JULY 22 Noon
Sports & Entertainment Law Section “Legal Issues in Operating a Performance Venue,” a panel of Dallas club operators, including Kim Finch and Don Nedler; Emily Horton, moderator. (MCLE 1.00)*
Intellectual Property Law Section “Copyright Law Update,” Kevin Meek. (MCLE 1.00)*
MONDAY, JULY 27 Noon
Securities Section “Opinions after Omnicare: Potential Pitfalls in Registration Statements,” Matthew Fry and Richard Guiltinan. (MCLE 1.00)*
DAYL Solo & Small Firm Committee
3:30 p.m. DBA Board of Directors Meeting 6:00 p.m. DAYL Dinner & Dialogue. For more information, contact cherieh@dayl.com.
DVAP New Lawyers Luncheon. For more information, contact reed-brownc@lanwt.org.
TUESDAY, JULY 28 Noon
Trial Skills Section “What Lawyers Can Learn From Actors: Being Effective In Front of a Jury,” Natalie Arbaugh and Cathryn Hartt. (MCLE 1.00)*
Courthouse Committee
American Immigration Lawyers Association
6:00 p.m. Dallas Hispanic Bar Association
WEDNESDAY, JULY 29 Noon
DAYL Lunch & Learn CLE. For more information, contact cherieh@dayl.com.
DAYL Equal Access to Justice Committee
Municipal Justice Bar Association
THURSDAY, JULY 30
8:00 a.m. Federal Bar Association Criminal Practice Seminar Noon
South Dallas Clinic “Attorneys’ Fees: Setting, Proving and Collecting Them,” Robert Tobey. (Ethics 1.00)* At UNT Dallas, 7400 University Hills Blvd, Building 2, Room #212. Park in lot in front of 7400 University Hills Blvd. RSVP to kzack@ dallasbar.org.
Collaborative Law Section “Coming Out of the Litigation Closet: An Update on How Collaborative Law Can Minimize Damage in Same-Sex Breakups,” Julie Quaid, Adam Seidel, Shelly Skeen and Barrett Stern. (MCLE 1.00)*
FRIDAY, JULY 31
8:00 a.m. Federal Bar Association Criminal Practice Seminar
SIGN UP FOR THE 2015 DBA 100 CLUB! Judiciary Committee Panel Discussion Noon
DAYL CLE Committee
What is the DBA 100 Club? The Dallas Bar Association 100 Club is a special membership recognition category given to firms, agencies, law schools and organizations that have 100% membership in the Dallas Bar Association.
What is the cost to join the DBA 100 Club? It’s FREE! How do you join? Firms, government agencies, and law schools with two or more lawyers as well as corporate legal departments may qualify for the DBA 100 Club if all attorneys are a member of the Dallas Bar Association. To join the 2015 DBA 100 Club, please submit a list of all lawyers in your Dallas office to Kim Watson, kwatson@dallasbar.org. We will verify your list with our membership records and once approved, your firm will be added to the 2015 DBA 100 Club membership list! What are the perks? Our 2015 DBA 100 Club members will be recognized in Headnotes, the 2016 DBA Pictorial Directory and receive a Certificate of Appreciation as well as recognition at our Annual Meeting in November. If we receive your list by July 6th, your organization will be included in the August DBA 100 Club recognition ad in Headnotes.
Send in your list TODAY!
Don’t Miss Out on this Great Opportunity!
On June 4, the Judiciary Committee presented a panel discussion titled “The State of the Civil Justice System in Texas.” Panelists included (left to right) moderator Jerry Fazio, Judge Craig Smith, Tom Melsheimer, Judge David Godbey, Al Ellis and Michele Smith.
If special arrangements are required for a person with disabilities to attend a particular seminar, please contact Cathy Maher at 214/220-7401 as soon as possible and no later than two business days before the seminar. All Continuing Legal Education Programs Co-Sponsored by the DALLAS BAR FOUNDATION. *For confirmation of State Bar of Texas MCLE approval, please call Teddi Rivas at the DBA office at 214/220-7447. **For information on the location of this month’s North Dallas Friday Clinic, contact KZack@dallasbar.org.
Jul y 2 0 1 5
Focus
D al l as Bar A ssoci ati on l Headnotes 3
Health Law & Employee Benefits/Executive Compensation
Pension Plan Buyout Offers by Brooks Hamilton
Which is the “smarter” retirement benefit choice? A $74,391 cash buyout rolled into an IRA at age 50 or a $1,095 monthly lifetime benefit beginning at age 65? When a friend recently asked this seemingly simple question, and because I have been in the “retirement” business for over 50 years, I wanted to give a relatively simple answer. But it turns out there is not one simple answer as the devil resides in the employee’s details. As I told my friend, if you think the $1,095 monthly pension will be important, and are in above average health, you may be better off choosing the pension. But if you think that it will not be important, that your life expectancy is below average, and that you have had success managing money, you may be better off choosing the cash buyout. The foundation of my thinking is explained below. My sole purpose is to explain these choices as clearly and succinctly as I can— and rationally target which appears preferable: (1) the Plan’s monthly pension of $1,095 beginning at age 65, or (2) a cash buyout at age 50 of $74,391 rolled over to an IRA account. Let us identify the benefit gap. At 8 percent, $74,391 will grow to $235,981 in 15 years, presumptively producing a $1,305 monthly pension; i.e., a benefit increase of $210. However, at 5 percent, $154,654 would presumptively produce $855; i.e., a monthly benefit decrease of $240. Slippery slope indeed! The word “presumptively” is used because a new risk is taken in a buyout—a “life expectancy risk” (explained below). Since the range of future benefits produced by a buyout appeared so large, I constructed the adjoining table to gain
better insight into this issue, which critically depends upon future IRA investment returns. Note that most investment return scenarios produce a reduction in the default monthly pension ($1,095). For example, if future IRA earnings average 3 percent, a participant’s pension benefit would be reduced 41 percent. But earning 8 percent increases the pension 19 percent. Clearly, future IRA investment earnings are crucial. What is a reasonable investment return to expect? And what does “life expectancy risk” mean? Logically, as life expectancy increases, pension benefits will decrease.
If the IRA earns 2 percent and grows to $100,120 over 15 years, this stealthy expectancy risk means that this sum may not provide the $554 monthly pension shown above. By 2030 one’s life expectancy may have soared, and a much smaller pension produced. So, if the monthly benefit remains at $554, there is a real risk that IRA money will be exhausted! Life expectancy was 47 in 1900, and soared to 77 by 2000! This 30 year increase, in 100 years, is the greatest in history! Many gurus believe future generations will have a triple-digit expectancy at birth.
Articles are speculating that pension plan costs will surely increase, and soon, by perhaps 10 percent! And that companies will increase buyout offers. Some gurus suggest that employees wait for the next buyout offer, as it will be significantly better. There are many moving parts determining which of these two choices will prove preferable. And there are several less obvious factors which may prove equally vital in a particular case. Personal health for example. Assume a 50-year-old is from a family that typically lives 10 years beyond life expectancy. Or 10 years short. If a person reasonably expects to live a long or short life, that is important to consider. Financial health is also important. Assume our 50 year old is wealthy. Or relatively poor. And what about other sources of retirement income? Perhaps a military pension? Or from a previous employer? Naturally, a spouse’s personal and financial health is equally important. Thousands of employees will face this question. One cannot say that all should take a buyout; or that none should. Or that a few, some, many or most, should or should not. It will depend, and the devil resides in the details. The choice is for the employee to make. The monthly pension may be preferable for some, while the buyout may prove preferable for others. Facts and circumstances control; unfortunately there is not a onesize-fits-all answer. Before you decide, re-read this essay. And remember what Mark Twain said: “It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just HN ain’t so.” Brooks Hamilton is a partner in Brooks Hamilton & Partners and can be reached at bhamilton@brookshamilton.com.
TexAs eRIsA ATTORney LOOKING FOR A JOB? NEED TO POST A JOB OPENING? VISIT THE DBA’S ONLINE CAREER CENTER
The DBA’s Online Career Center is a great resource for attorneys and legal professionals! Jobseekers can search jobs, post their resume and set up email alerts. Employers can post job openings as well as search resumes to find the right candidate! Log on to www.dallasbar.org/career-center to get started.
Bernard A. Guerrini 6500 Greenville Ave. Ste. 320 Dallas, TX 75206 baguerrini@erisaltd.com
DALLAS BAR ASSOCIATION TO PARTNER WITH BIG BROTHERS BIG SISTERS ON mentor2.0
The Dallas Bar Association is proud to join hands with Big Brothers Big Sisters (BBBS) by merging its very successful E-Mentoring Program created in 2003 with BBBS very successful program, mentor2.0. The DBA will adopt the 2015 freshman class at North Dallas High School, located in Uptown in the fall. The Dallas Bar has been fortunate to have outstanding and committed leaders of the E-Mentoring Program over the years, and most recently, Co-Chairs, Krista Hanvey and Ashley Sissell, along with long-time committee member, Stephanie Zaleskin have led the successful program. Mentor2.0 is primarily an electronic platform, just as the DBA E-Mentoring Program and is also designed to help students graduate from high school, succeed in college and in their careers. The new program includes a guided curriculum, in-class staffing by BBBS, match support from BBBS, and fun in-person group events every six weeks at North Dallas High School. The DBA’s E-Mentoring Program concluded at the end of the school year and all current DBA mentors are encouraged to continue mentoring in the DBA/BBBS mentor 2.0 program at North Dallas High School for the 2015-2016 school year. Mentors are asked to make a two-year commitment with the hope that the match will last through high school, as well as make weekly e-mail contact with mentees and attend face-to-faceevents every six weeks at the school.
214-692-6556
Serving all of Texas
Short & Long Term Disability Insurance Claims Are The Heart Of Our Practice ERISA and Non-ERISA
“Our members are passionate about helping students be successful in high school, and we are very proud to join with Big Brothers Big Sisters to help make our programs stronger programs,” said Brad Weber, DBA president. For more information and to sign up, please go to www.bbbsmentor2.org. All current mentors are asked to enroll now. If you have any questions, please contact Mandy Klem at mklem@bbbstx.org. To watch a short video on mentor2.0 http://bbbsmentor2.org/2013/youtube-video-on-mentor2-0/
erisaltd.com
4 He a d n o t e s l D a l l a s B a r A s s o ciation
Jul y 2015
Headnotes
President's Column
Published by: DALLAS BAR ASSOCIATION
214 Lawyers Brad Weber
“214 Lawyers”—you know, those lawyers from Dallas who have “214” area codes in their telephone numbers. It is a euphemism used by some lawyers and judges around the state when talking about Dallas lawyers. When they use the term it rarely is meant to be flattering. I recently heard another Dallas lawyer described as a “214 lawyer,” and it caused me to wonder—“Why is it that Dallas lawyers often have poor reputations outside of Dallas?” In 1987 when I arrived in Dallas as a new lawyer, the term “Rambo Litigator” was commonly used to describe lawyers who utilized hardball litigation tactics. The term was derived from the 1982 movie First Blood, starring Sylvester Stallone as John Rambo, a troubled Vietnam War veteran and former U.S. Army Special Forces officer who was skilled in hand-to-hand combat and guerrilla warfare. “Rambo tactics” were characterized as zealous advocacy, disdain for common courtesy and civility, and a scorched earth litigation strategy. Rambo litigators were those who used discovery as a weapon, constantly threatened other lawyers with sanctions, and engaged in an aggressive and abusive style of litigation in order to win at all costs. Unfortunately, many Dallas lawyers and their clients seemed to equate successful lawyers with those who utilized Rambo tactics. This, in turn, likely contributed to the poor reputations associated with many Dallas lawyers. Due to the proliferation of Rambo tactics during the 1980s, the U.S. District Court for the Northern District of Texas issued an opinion in 1988 that set standards for professional conduct among lawyers who practice in that court, Dondi Properties Corp. v. Commerce Savings and Loan Assoc., 121 F.R.D. 284 (N.D. Tex. 1988) (per curium). Signed by every judge in the Northern District of Texas, Dondi was intended to curb the pernicious problem of abusive litigation tactics that was threatening to delay the administration of justice and to place litigation beyond the financial reach of litigants. Following the issuance of Dondi, every lawyer admitted to practice in the Northern District of Texas must attest that he or she has read the opinion and will comply with it. Even before the Dondi opinion was issued, the Dallas Bar Association was taking steps to improve the level of professionalism among Dallas lawyers. In 1987, the DBA
Board of Directors adopted the Dallas Lawyer’s Creed and the Dallas Bar Association Guidelines of Professional Courtesy. The Creed and Guidelines established an aspirational code of conduct that was intended to curb the overly aggressive actions of Rambo-like members of the Dallas legal community. Predicated upon the maxim that attorneys owe duties of candor, diligence, and respect to their clients, the judiciary, and opposing counsel, the Creed and Guidelines emphasize the importance of dispensing justice and meeting each client’s needs, rather than waging expensive and harassing legal warfare. Over the years, the DBA has placed a high priority on encouraging professionalism among its members. The Morris Harrell Professionalism Committee sponsors a number of programs designed for this purpose, including the “Law Students’ Professionalism Program” and the “Transition to Law Practice Program.” Both of these programs are designed to teach law students and new lawyers the importance of practicing law with professionalism and civility. I believe that these longstanding DBA programs, which are led by some of the most respected judges and lawyers in Dallas, have had a significant, positive effect on the level of professionalism among the Dallas legal community. It is difficult to measure the positive effects that these DBA professionalism programs have had on the general reputation of Dallas lawyers, but I have seen signs that suggest the negative stigma associated with “214 lawyers” may be diminishing. In the recent State Bar of Texas election for President-Elect, Frank Stevenson from Dallas defeated a “512 lawyer” from Austin. This was the first time in 13 years that a candidate from Dallas has been elected to this position, despite the fact that there have been several outstanding lawyers from Dallas who were candidates during that time period. Going into the campaign many viewed Frank as the underdog because of the “214” at the beginning of his phone number, but he was able to overcome that stigma and win the election. Based on my observations, Dallas lawyers are much more professional than their reputations as “214 lawyers” would suggest. The vast majority of Dallas lawyers are committed professionals who pursue their legal careers with civility, courtesy, and honesty. And for those Dallas lawyers who continue to use Rambo tactics in their law practices, I hope they have HN a “469” area code in their telephone number.
Just a Few of the CLE Presentations: Mark Lanier on “Technology in the Courtroom”
John Ansbach explains “The Internet of Things”
Justice Don Willet and Supreme Court of Texas Blogger Don Cruse
Federal Judges—Meet Your New Judges
State Judges tell us “What the Jury Says”
SAVE THE DATE! SEPTEMBER 17 - 6 A.M. TO MIDNIGHT
REGISTER NOW for the discounted EARLY BIRD RATE! YOUNG LAWYERS (Licensed 1-5 years): CATCH THE YOUNG LAWYER EARLY BIRD SPECIAL RATE!
www.dallasbar.org or 214-220-7403
Events/Activities: Plan to Stay Friday Night! Sporting Clays, Game Plan, Golf, Tennis, Yoga and more! More than 7 hours CLE, including 1.00 hour ethics.
Casual Attire Only!
Minority Clerkship Luncheon Friday, July 10, Noon at Belo Learn about the broad range of opportunities available in Dallas. Speakers: Jonathan Childers Dallas Association of Young Lawyers Rocio Garcia Dallas Hispanic Bar Association Bill Richmond Dallas Asian American Bar Association Ebony Rivon J.L. Turner Legal Association Hon. Roberto Cañas Dallas County Criminal Court No. 10, Moderator RSVP to bavina@dallasbar.org
2101 Ross Avenue Dallas, Texas 75201 Phone: (214) 220-7400 Fax: (214) 220-7465 Website: www.dallasbar.org Established 1873
The DBA’s purpose is to serve and support the legal profession in Dallas and to promote good relations among lawyers, the judiciary, and the community.
OFFICERS President: Bradley C. Weber President-Elect: Jerry C. Alexander First Vice President: Rob D. Crain Second Vice President: Michael K. Hurst Secretary-Treasurer: Victor D. Vital Immediate Past President: Scott M. McElhaney Directors: Wes Alost, A. Shonn Brown, Jonathan Childers (President, Dallas Association of Young Lawyers), Laura Benitez Geisler (Chair), Hon. Harlin “Cooter” Hale (Judicial At-Large), Hon. Martin Hoffman, Krisi Kastl, Michele Wong Krause, Monica Lira (President, Dallas Hispanic Bar Association), Bill Mateja, Karen McCloud, Cheryl Camin Murray (At-Large), Courtney Barksdale Perez (At-Large), Bill Richmond (President, Dallas Asian American Bar Association), Ebony Rivon (President, J.L. Turner Legal Association), Mary Scott, Diane M. Sumoski, Robert L. Tobey (Vice-Chair) and Aaron Tobin Advisory Directors: Stephanie Gause (President-Elect, Dallas Association of Young Lawyers), Rocio Cristina Garcia (President-Elect, Dallas Hispanic Bar Association), Emmanuel Obi (President-Elect, J.L. Turner Legal Association), and Monika Sanford (President-Elect, Dallas Asian American Bar Association). Delegates, American Bar Association: Rhonda Hunter, Hon. Liz Lang-Miers Directors, State Bar of Texas: Wm. Frank Carroll, Leon Carter, John Jansonius, Florentino A. Ramirez and Scott Stolley HEADNOTES Executive Director/Executive Editor: Catharine M. Maher Communications/Media Director & Headnotes Editor: Jessica D. Smith In the News: Judi Smalling Art Director: Thomas Phillips Display Advertising: Deni Ackerman, Tina DeRobertis, Annette Planey, Jessica D. Smith Classified Advertising: Judi Smalling PUBLICATIONS COMMITTEE Co-Chairs: Jared Slade and Meghan Hausler Vice-Chairs: Paul Clevenger and Keith Pillers Members: Timothy Ackermann, Jerry C. Alexander, Vincent Allen, Natalie Arbaugh, Jody Bishop, Lisa Tomiko Blackburn, Jillian Bliss, Jason Bloom, Andrew Botts, Lance Caughfield, Chhunny Chhean, Stephen Clarke, Shannon Conway, Joel Crouch, David Dummer, Christopher Elam, Alexander Farr, Daniel Felz, Dawn Fowler, Robin Ghio, Basheer Ghorayeb, Kimberly Gonzalez, Andrew Gould, Susan Halpern, Jeremy Hawpe, Zachary Hilton, Ezra Hood, Mary Louise Hopson, Michael K. Hurst, Ashley Johnson, Amanda Kelley, Sara Krumholz, Margaret Lyle, Thomas Maddrey, Orly Mazur, Jodi McShan, Ethan Minshull, Paige Montgomery, Jessica Nathan, Jeffrey Novel, Eugene Olshevskyy, Mason Parham, Aimee Pingenot, Kirk Pittard, Laura Anne Pohli, Lisa Prather, Michelle Reed, David Ritter, Carl Roberts, Lantis Roberts, Eugenie Robichaux, Joshua Sandler, Chandrika Shori, Micah Skidmore, Stefan Smith, Bradley Smyer, Thad Spalding, Elizabeth Stanley, John Stevenson, John Ting, Paul Tipton, Pryce Tucker, Peter Vogel, Tracey Wallace, Brad Weber, Philip Worley DBA & DBF STAFF Executive Director: Catharine M. Maher Accounting Assistant: Shawna Bush Communications/Media Director: Jessica D. Smith Controller: Sherri Evans Director of Community Services: Alicia Hernandez Events Director: Rhonda Thornton Executive Assistant: Mary Ellen Johnson Executive Director, DBF: Elizabeth Philipp LRS Program Assistant: Biridiana Avina LRS Interviewers: Viridiana Avina, Marcela Mejia Law-Related Education & Programs Coordinator: Kimberlynn Taylor Membership Coordinator: Kimberly Watson Projects Coordinator: Kathryn Zack Publications Coordinator: Judi Smalling Receptionist/Staff Assistant: Yedenia Hinojos DALLAS VOLUNTEER ATTORNEY PROGRAM Director: Alicia Hernandez Managing Attorney: Michelle Alden Mentor Attorneys: Kristen Salas, Katherine Saldana Volunteer Recruiter: Chris Reed-Brown Paralegals: Whitney Breheny, Tina Douglas, Zaporra Gonzales, Andrew Musquiz, Carmen Perales, Alicia Perkins, Monique Scott, Zach Watkins Program Assistant: Patsy Quinn Secretary: Ellie Pope Copyright Dallas Bar Association 2015. All rights reserved. No reproduction of any portion of this publication is allowed without written permission from publisher. Headnotes serves the membership of the DBA and, as such, editorial submissions from members are welcome. The Executive Editor, Editor, and Publications Committee reserve the right to select editorial content to be published. Please submit article text via e-mail to jsmith@ dallasbar.org (Communications Director) at least 45 days in advance of publication. Feature articles should be no longer than 750 words. DISCLAIMER: All legal content appearing in Headnotes is for informational and educational purposes and is not intended as legal advice. Opinions expressed in articles are not necessarily those of the Dallas Bar Association. All advertising shall be placed in Dallas Bar Association Headnotes at the Dallas Bar Association’s sole discretion. Headnotes (ISSN 1057-0144) is published monthly by the Dallas Bar Association, 2101 Ross Ave., Dallas, TX 75201. Non-member subscription rate is $30 per year. Single copy price is $2.50, including handling. Periodicals postage paid at Dallas, Texas 75260. POSTMASTER: Send address changes to Headnotes, 2101 Ross Ave., Dallas, TX 75201.
Jul y 2 0 1 5
D al l as Bar A ssoci ati on l Headnotes 5
Get Ready for
e m i T d o o G ’ n i k c Ro at Law Jam 5! Saturday, August 22, 2015
Doors open at 6:30 p.m. Music starts at 7:00 p.m. The Granada Theater—Lower Greenville Avenue Listen to great music by lawyer bands: Big Wheel u Black Dirt Tango u The Catdaddies u Random Blue A night of great music, food and fun! Silent auction Proceeds benefit the Dallas Volunteer Attorney Program Get Your Tickets Today at www.dbalawjam.org. Tickets: $25 in advance/$35 after August 7. Law Students Only $10! For sponsorship information, contact jsmalling@dallasbar.org.
6 H e a d n o t e s l D a l l a s B a r A s s o ciation
Column
Jul y 2015
Ethics
A Reasonable Expectation of Privacy for Client Information? by Katherine C. Hall
Texas Professional Ethics Committee Opinion 648 (April 2015) has now addressed whether lawyers may communicate confidential information by email. Lawyers used to send most written communications via the U.S. Postal Service or by fax. Many now use web-based email, such as unencrypted Gmail. How can we discharge our duties to protect information in the current environment? As a general rule, lawyers must protect confidential client information. Tex. Disciplinary Rules Prof ’l Conduct R. 1.05. reprinted in Tex. Gov’t Code Ann., tit. 2, subtit. G, app. A (West 2005)(Tex. State Bar R. art. X, § 9). We must safeguard privileged and unprivileged client information, both of which might be transmitted by email. Rule 1.05(b) provides (except as otherwise specified under paragraphs (b) - (f)): “a lawyer shall not knowingly . . .[r] eveal confidential information of a client or a former client to (i) a person that the client has instructed is not to receive the information; or (ii) a n y one else, other than the client, the client’s representatives, or the members,
associates, or employees of the lawyer’s law firm.” Using email creates a risk that unauthorized persons might get confidential information. Organizations previously considering the problem, such as the American Bar Association and other states’ legal committees, often raise two points: • All delivery systems present an inherent risk that an unauthorized person will gain access to confidential information, and • Email users have a reasonable expectation of privacy under statutes that criminalize email interception, like the Electronic Communications Privacy Act, 18 U.S.C. § 2510 et seq. (1986). Also instructive, Texas Professional Ethics Committee Opinion 572 (June 2006) determined that a lawyer could disclose privileged items when he reasonably expected a copy service to respect the confidential nature of the information. Following analysis of these precedents, Opinion 648 announced: “In general, considering the present state of technology and email usage, a lawyer may communicate confidential information by email. In some cir-
Do You Want to Refresh Your Spanish? Spanish for Lawyers is the Answer! 10-Week Fall Course | $180 • August 25-October 29, 2015 All courses are a continuation of spring semester. For more information, contact Yedenia Hinojos at yhinojos@dallasbar.org or (214) 220-7447.
cumstances, however, a lawyer should consider whether the confidentiality of the information will be protected if communicated by email and whether it is prudent to use encrypted email or another form of communication.” Of course, lawyers should exercise caution when handling communications of “highly sensitive or confidential information.” They should also consider whether to use encrypted email or other forms of communication when dealing with situations in which: • a client has a shared email account, • a third party (spouse or co-worker) has obtained an account password, • a lawyer or client is using a public or borrowed computer, • a recipient checks email on an unprotected cellphone or other device, or • a lawyer is concerned that a law enforcement agency may read email communications “with or without a warrant.” After the Opinion was released, a well-known security technologist blogged that attackers could read and modify encrypted data over certain connections. Schneier on Security, The Logjam (and Another) Vulnerability against Diffie-Hellman Key Exchange (May 21, 2015), https://www.schneier. com. Computer security breaches are often in the news. Last year, for example, hackers launched a cyber-attack against a major bank, compromising account security for an estimated 76 million households and 7 million small businesses. Despite the bank’s annual $250 million computer-security bud-
get, overseas hackers accessed sensitive, personal data, including names, addresses and emails of account holders. Russian hackers are said to be reading President Obama’s unclassified email. And the NSA reportedly collects Gmail user data. Ethical lawyers might not knowingly reveal confidential information. Most would lack “knowledge,” as did JPMorgan Chase and the White House. Is lack of knowledge—which is virtually certain—sufficient? Encryption software written years ago—with known vulnerabilities—though reportedly patched in the last few weeks, is used by many websites and email providers, and is now in question. Because it is not clear that state or federal statutes provide a “reasonable expectation of privacy” for anyone, what can we do? The Opinion suggests that we: • advise and caution clients about the dangers inherent in sending or accessing emails, • obtain clients’ informed consent to use email, including unencrypted email, and • maintain ongoing evaluation of technology and email practices. The Opinion’s analysis of the Texas Disciplinary Rules of Professional Conduct, which does not include fiduciary obligations or best practices, notes that “there may be changes in the risk of interception of email communications over time that would indicate that certain or perhaps all communications should be HN sent by other means.” Katherine C. Hall is a Dallas-based lawyer. She can be reached at khall.atty@sbcglobal.net.
South Dallas Clinic Presents:
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In partnership with Big Brothers Big Sisters, the DBA has adopted North Dallas High School for the new MENTOR2.0 Program. North Dallas High School is conveniently located in Uptown at Cole and McKinney Avenue. The MENTOR2.0 Program is primarily an electronic pla�orm mentoring program with the 2015-2016 freshman students. It is designed for DBA volunteers to help students prepare for college and career success through e-mail and face-to face visits every six weeks at the school. This highly successful program has already made a huge difference in the lives of many students.
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J ul y 2 0 1 5
Focus
D al l as Bar A ssoci ati on l Headnotes 7
Health Law & Employee Benefits/Executive Compensation
Fly Ball! ERISA and Fly Ball Communication by Jim Griffin
In baseball, two outfielders must communicate with each other when a fly ball is headed in their general direction. One player is responsible for making the play while the other player is responsible for getting out of the way. Baseball players are taught rules of priority and communication to keep the game running smoothly. Those rules also keep routine plays from showing up on Sports Center’s blooper reel. This baseball analogy applies to an important recent ERISA case involving executive retirement benefits and payroll taxes. In Davidson v. Henkel, Case No. 12-cv14103 (E.D. Mich. Jan. 6, 2015), the fly ball was the obligation to collect and remit Social Security and Medicare taxes owed by Henkel Corporation and its executives on monthly retirement benefits. For brevity, I will call these payroll taxes. Whether they knew it or not, the outfielders, Henkel’s benefits and payroll departments, were responsible for making the play. Typically, the benefits department is responsible for designing and administer-
ing an executive retirement plan. The payroll department is responsible for collecting, remitting and reporting taxes on executive retirement plan benefit payments. Unfortunately, neither department fielded the ball. In fact, it appears that neither department knew that a payroll tax ball was even in play. Let us look more closely at what happened. John Davidson, an executive of Henkel, retired in 2003. John worked for Henkel for more than 30 years. Through his employment, John earned a right to receive lifetime monthly payments from Henkel after retirement. The monthly payments were only available to executives under a nonqualified deferred compensation plan. In 2011, to everyone’s surprise, Henkel discovered that it had not collected and paid payroll taxes on John’s executive retirement benefits. Henkel arranged a meeting with the IRS to discuss the matter. After that meeting, Henkel sent a letter to John to let him know that payroll taxes would have to be withheld from his monthly payments which would reduce the cash amount that John received each month.
Not being satisfied with Henkel’s explanation, John decided to protest Henkel’s decision to the umpire of the dispute, the federal tax court. John argued that Henkel should have been required to collect and remit payroll taxes on his retirement payments under a tax rule called the “special timing rule.” The special timing rule—added to the employment tax regulations in the early 1990s—imposes a duty on the plan provider to deduct payroll taxes on the present value of future monthly retirement payments. John argued that Henkel’s failure to use the special timing rule in 2003 increased John’s payroll tax liability. When Henkel discovered the tax problem in 2011, it was too late for Henkel to use the special timing rule. Instead, the employment tax regulations required Henkel to use another rule called the “general timing rule.” That rule imposed payroll taxes on John’s monthly payments on a “pay as you go” basis. John asked the Court to hold Henkel liable for the additional payroll taxes that John would owe under the general timing rule because of Henkel’s failure to apply the
special timing rule. The Court ruled in favor of John’s Motion for Summary Judgment, finding that Henkel had a duty as an ERISA fiduciary to administer its plan in John’s best interest. Henkel’s fiduciary duty included the obligation to administer the plan in a way that would minimize John’s payroll taxes. The Court explained that the general purpose and wording of Henkel’s plan formed the basis for this duty. Employers with plans like Henkel’s should pay careful attention to how and when payroll taxes will be applied to nonqualified deferred compensation plan payments. John’s case is ongoing and has moved to the damages phase. Henkel may seek relief from this new fiduciary duty from the “instant replay umpire”— the appeals court. Time will tell whether there is a fiduciary duty under ERISA to minimize payroll taxes in these circumstances. Regardless of the outcome, Davidson v. Henkel is an important reminder of how base HN ball applies in law and in life. Jim Griffin is a partner at Jackson Walker LLP and can be reached at jgriffin@jw.com.
ABA Publication Discount For DBA Members Texas Rangers Baseball DBA Discount Tickets Now Available! If you are interested in Season Tickets, Suite Rentals or Group Tickets, please contact Jeremy Christopher at (817) 273-5173.
Dallas Bar members can purchase ABA books at a 15% discounted rate. For a complete list of titles or to place an order, visit www.ababooks.org. Enter code “PAB7EDBA” upon checkout and the 15% discount will be automatically applied to your order. Discount does not apply to ABA-CLE iPod products. For assistance, call (312) 988-6112.
8 He a d n o t e s l D a l l a s B a r A s s o ciation
Focus
Jul y 2015
Health Law & Employee Benefits/Executive Compensation
Fueling Interest in Severance Arrangements by Lori Oliphant
It is BIG news in Texas. Oil prices have been plummeting. In response, several energy companies have announced reductions in force. Halliburton, Schlumberger, Apache and Baker Hughes were among those companies to announce layoffs in an effort to match their resources with current demand. When implementing reductions in force, or any involuntary termination without cause, employers often consider providing severance benefits to the departing employees. Benefits may consist of cash payments, accelerated vesting of incentive awards, health and welfare benefits, and outplacement services. While some employers consider these arrangements contemporaneously with a particular event, many employers adopt broad plans or policies that designate the benefits that will be paid to employees who are involuntarily terminated in connection with designated future events. Severance benefits may also be addressed in individual employment agreements. Although preexisting obligations provide less flexibility for the employer, such programs help attract key employees and maintain morale during an economic or industry downturn. Regardless of the format or scope of
benefits, however, all severance arrangements must be drafted and administered with caution. Failure to do so could result in violations of applicable federal and state laws as well as unexpected tax liability to the employee. It is common for severance benefits to be conditioned upon the employee’s release of employment-related claims. For a release to be enforceable, however, the severance benefits must constitute consideration for the release, the release cannot cover future rights and the employee must knowingly and voluntarily consent to the release. In addition, the release cannot limit the employee’s right to participate in an investigation, hearing or proceeding conducted by the Equal Employment Opportunity Commission. Special attention must also be given to releases of age discrimination claims obtained from employees age 40 or over as well as to waivers obtained in connection with layoffs involving groups of employees age 40 or over. In addition to labor laws, severance arrangements can implicate the Employee Retirement Income Security Act of 1974 (ERISA). A severance arrangement that is subject to ERISA may be required to comply with various statutory mandates related to reporting, disclosure, vesting, funding, fiduciary responsibility and
claims procedures. Many severance arrangements are structured to avoid some or all of the foregoing requirements. For example, a plan that provides a limited benefit upon a termination of employment (other than retirement) and that is paid out within two years of the termination will generally not be subject to ERISA’s funding and vesting requirements. Similarly, an unfunded plan that is maintained primarily for a select group of management or highly compensated employees (referred to as a “top-hat plan”) will be exempt from most of ERISA’s requirements, if an election is timely filed with the Department of Labor. Finally, severance arrangements may constitute nonqualified deferred compensation subject to Section 409A of the Internal Revenue Code of 1986, as amended (Code). If the arrangement fails to satisfy the requirements of Code Section 409A, in form or operation, the benefits are immediately taxable to the employee upon vesting and the employee can be subject to a 20 percent excise tax as well an interest charge. In order to comply with Code Section 409A, payments may only be made upon limited events stated in the statute and the employee must be restricted on his or her ability to defer or to accelerate such
payments once set. Furthermore, severance payments to officers of publicly held companies must generally be delayed for six months following termination of employment. Due to these restrictions, it can be especially challenging to condition a payment on the receipt of an executed, irrevocable release or to provide immediate severance payments to key employees. Notably, arrangements that are entered into contemporaneously with an involuntary termination will not be subject to the foregoing restrictions if the benefits are paid immediately upon termination (or within a short period following the end of the taxable year). For other arrangements, several useful exemptions exist under Code Section 409A and an employer can rely on any or all of them, to the extent they apply. For example, an arrangement that provides limited benefits payable within a limited period following the termination of employment, or that is offered pursuant to a collectivelybargained separation pay plan, is exempt. Similarly, certain reimbursements and inkind benefits, including medical benefits, can be exempt if applicable conditions HN are satisfied. Lori Thayer Oliphant is a Shareholder at Winstead PC and can be reached at loliphant@winstead.com.
NEED TO REFER A CASE?
J.L. Turner Legal Association Bedford Awards Luncheon New Date: Friday, August 21, Noon at Belo Keynote Speaker: Cheryl Wattley, UNT Dallas College of Law Tickets: $25/each or $250/table. To register, contact twaits@mcglinchey.com.
The DBA Lawyer Referral Service Can Help. Log on to www.dallasbar.org/dallas-lawyer-referral-service or call (214) 220-7499. CLIENT: Communities Foundation of Texas JOB#: CFOT-14-011 Brand Campaign
T I M VO N H AT T E N
North Texas Giving Day Donor
TRIM: 5"w x 7.75"h LIVE: 5"w x 7.75"h BLEED: n/a COLOR: CMYK
Professionalism Tip
I will advise my client that I reserve the right to determine whether to grant accommodations to opposing counsel in all matters that do not adversely affect my client’s lawful objectives. A client has no right to instruct me to refuse reasonable requests made by other counsel.
PUB: Headnotes CONTACT: Jessica D. Smith, Headnotes Editor Communications/Media Director (214) 220-7477 jsmith@dallasbar.org
Find the complete Creed online at http://txbf.org/texas-lawyers-creed/. Excerpt from the Texas Lawyers Creed
RELEASE: 6/10/15 INSERTION: July Pickup for September.
DVAP’s Finest Joe Cox
Joe Cox is a partner at Bracewell & Giuliani LLP. Through DVAP, Joe said that he has met some of the most deserving people who need legal help. He has handled divorce cases (with and without children), drafted wills, worked on landlord-tenant disputes and handled consumer cases. As Joe said, “These pro bono representations bring a smile to my face when I see the smiles of my clients after they obtain relief from the court or receive the services only a lawyer can provide. All lawyers, young and old, should do pro bono work.” Thank you for all you do, Joe!
CRE ATIN G A C YCLE of G I V IN G On North Texas Giving Day, an annual giving event organized by Communities Foundation of Texas, thousands of people donate to nonprofits that are improving our community. One of those nonprofits, Arlington Life Shelter, helped Tim Von Hatten overcome
Deep in the heart of giving™
Pro Bono: It’s Like Billable Hours for Your Soul.
the encompassing despair of homelessness, addiction and joblessness. Four years later, with a fulfilling career and bright future, Tim was able to donate back to the organization that changed his life. Thanks to the incredible outpouring of support on North Texas Giving Day, many of
Open your fund today. Call us at 214-750-4145,
the discouraged and hopeless are empowered to eventually
email giving@cftexas.org
give back themselves, creating an enduring cycle of giving.
or visit www.CFTexas.org/GivingFund.
CFOT-14-011 Headnotes_TVonHatten_01mg.indd 1
6/8/15 3:12 PM
To volunteer or make a donation, call 214/748-1234, x2243.
J ul y 2 0 1 5
D al l as Bar A ssoci ati on l Headnotes 9
2015 DBA 100 CLUB - WE WANT YOU! What is the DBA 100 Club? The DBA 100 Club is a distinguished membership recognition category that consists of Firms, Law Schools and Government agencies with two or more attorneys as well as corporate legal departments that have 100% membership in the DBA. Recognition is free and given to the 2015 DBA 100 Club members in our June, July and August Headnotes and at our Annual meeting in November. Please note that the DBA 100 Club is FREE recognition and open for renewal annually. We do not automatically renew an organization’s membership due to changes in attorney rosters each year. Do you see your name on the list? If not, you need to GET ON THE LIST! To become a 2015 DBA 100 Club member, please submit your request via email and include a list of all lawyers in your Dallas office to Kim Watson, kwatson@dallasbar.org. We will verify your list with our membership records and if you qualify, your firm will be added to the 2015 DBA 100 Club! If we receive your list by July 6th, your firm will be included on the August DBA 100 Club recognition list in Headnotes.
Send in your list of lawyers in your firm TODAY! DBA 100 Club Members As of June 17, 2015 2 to 5 Attorneys A. William Arnold III & Associates, P.C. Ackerman & Savage, L.L.P. Adair, Morris & Osborn, P.C. Aldous \ Walker Alexander Dubose Jefferson & Townsend LLP Anderson & Brocious P.C. Anderson Beakley, PLLC Anthony & Middlebrook, P.C. Ashcraft Law Firm Ashley & Laird Atwood Gameros LLP Bailey Brauer PLLC Blackwell & Duncan, PLLC Blankenship, Wiland & O’Connor, P.C. Campbell & Associates Law Firm, P.C. Carlock & Gormley Christiansen Davis LLC Clark Law Firm Coffin & Bailey, PLLC Collins Law Group PC Connatser Family Law Crain Lewis, L.L.P. Cunningham Swaim Curtis Law Group Daniel Sheehan & Associates, LLP Deandra M. Grant & Associates Dement | Stern PLLC Dunn Sheehan LLP Edwards & de la Cerda, L.L.C. Elliott Thomason & Gibson, LLP Erhard & Jennings, P.C. Fair & Watts, P.C. Fisher & Welch, P.C. Franklin Hayward LLP Goldfarb PLLC Grau Law Group, PLLC Grogan & Brawner P.C. Hamilton & Squibb, LLP Hance | Wickham, P.C. Hedrick Kring, PLLC Helms & Kilgore, PLLC Hollingsworth Walker Holmes Firm PC Hooper & Hale, LLP Horton & Archibald, P.C. Hunt | Ham, PLLC Jameson & Powers, P.C.
Johnston ♦ Tobey, P.C. Kabani & Kabani, PLLC Karel & Hicks, P.C. Kevin Buchanan & Associates, P.L.L.C. Kinser & Bates, L.L.P. Kleiman, Lawrence, Baskind & Fitzgerald, L.L.P. Koning Rubarts LLP Langley LLP Law Offices of Carmen S. Mitchell, LLP Law Offices of Maduforo & Osimiri Law Offices of Richard A. Gump, Jr., P.C. Law Offices of Terrence G. Turzinski, P.C. Lawrence Law PLLC Lidji Dorey & Hooper Lillard Wise Szygenda PLLC Little Pedersen Fankhauser LLP Lori A. Leu & Associates Malouf & Nockels LLP Maris & Lanier, P.C. Marshall & Kellow, LLP Martin + Sallaway, PLLC McElree | Smith McTaggart & Beasley, PLLC Mincey-Carter, PC Mullin Hoard & Brown, L.L.P. Musgrove Law Firm, P.C. Orenstein Law Group, PC Prager & Miller, P.C. Quaid Farish, LLC Raggio & Raggio, P.L.L.C. Ramirez & Associates, P.C. Ray & Thatcher, Attorneys at Law PC Richardson Koudelka, LLP Riney Packard PLLC Rochelle & Rankin LLP Rose Walker, L.L.P. Rosenberg Paschall Johnson LLP Sawicki Law Schubert & Evans, P.C. Sheils Winnubst, PC Silverman Goodwin, LLP Simon | Paschal PLLC Smith Hargrave Law Smith, Stern, Friedman & Nelms, P.C. Stamer Chadwick Soefje PLLC Stanton Law Firm PC Suggs Law Firm, P.C. The Courtney Firm The Vermillion Law Firm, LLC Thomas, Cinclair & Beuttenmuller, PC
Tillman Batchelor LLP Travis Law Group, P.C. Tremain Artaza PLLC Ward & Turton, PLLC Williamson Law, PLLC Winn, Beaudry & Winn, L.L.P. Woodward & Shaw Woolley <> Wilson, LLP. Law Firms with 6 or More Attorneys Ackels & Ackels, L.L.P. Addison Law Firm P.C. Baker Botts, L.L.P. Beirne, Maynard & Parsons, L.L.P. Bell Nunnally & Martin LLP Bragalone Conroy PC Brousseau Naftis & Massingill Burford & Ryburn, L.L.P. Canterbury, Gooch, Surratt, Shapiro, Stein & Gaswirth, P.C. Carrington, Coleman, Sloman & Blumenthal, L.L.P. Carstens & Cahoon, LLP Carter Scholer Arnett Hamada & Mockler, PLLC Cavazos, Hendricks, Poirot & Smitham, P.C. Cobb Martinez Woodward PLLC Condon Thornton Sladek Harrell LLP Cowles & Thompson, P.C. Cozen O’Connor Cutler Smith, PC Deans & Lyons, LLP Estes Okon Thorne & Carr PLLC Ford, Nassen & Baldwin Godwin Lewis PC Griffith Davison & Shurtleff, P.C. Gruber Hurst Elrod Johansen Hail Shank LLP Guida, Slavich & Flores, P.C. Hankinson LLP Hiersche, Hayward, Drakeley & Urbach, P.C. Higier Allen Lautin, P.C. Hoge & Gameros, L.L.P. Jordan Cresswell Monk Reber, PC Kessler Collins, P.C. Key Harrington Barnes PC Klemchuk LLP KoonsFuller Littler Mendelson, P.C. Locke Lord LLP Malouf Lynch Jackson & Swinson, P.C. McCathern, LLP
McGuire, Craddock & Strother, P.C. McKool Smith P.C. Meadows, Collier, Reed, Cousins, Crouch & Ungerman, L.L.P. Mullin Russ Kilejian PC Munsch Hardt Kopf & Harr, P.C. Passman & Jones, P.C. Rochelle McCullough LLP Sayles Werbner, P.C. SettlePou Shore Chan DePumpo LLP Sorrels, Udashen & Anton Spencer Law, P.C. Stacy & Conder, L.L.P. Staubus & Randall, L.L.P. Steed Dunnill Reynolds Murphy Lamberth LLP The Bassett Firm, P.C. The Hartnett Law Firm Thiebaud Remington Thornton Bailey LLP Thomas, Feldman & Wilshusen, L.L.P. Thompson & Knight LLP Tollefson Bradley Mitchell & Melendi, LLP Touchstone Bernays Turley Law Firm VernerBrumleyMcCurley Winstead PC Wright Ginsberg Brusilow P.C. Zelle Hofmann Voelbel & Mason LLP Corporate Legal Departments Austin Industries, Inc. Baptist Foundation of Texas Borden Dairy Company D6 Consulting LLC Front Burner Restaurants, LP Hexter-Fair/First American Title Company Morgan Management Corporation Neuberger Berman Tenaska, Inc. Government Agencies & Law Schools City of Irving UNT Dallas College of Law Special Recognition Students of the UNT Dallas College of Law Inaugural Class 2014
Audits Conducted by Medicare continued from page 1
sent to providers as part of the monthly random sample, they request that medical records be returned within 75 days of the initial CERT letter. If a provider fails to respond or the response is incomplete, payment may be denied or CMS may require repayment of any money previously paid. If the CERT experts (e.g., nurses, coders, etc.) determine an improper payment was made, the provider will be required to reimburse payment. However, providers maintain a right to appeal any adverse decision.
Recovery Audit Contractor
Medicare Recovery Audit Contractors (RACs) are responsible for identifying and calculating overpayments and underpayments made to providers under Medicare through post payment claims review. RACs are increasingly expected
to identify fraud and make appropriate referrals to CMS. It should be noted that RACs, unlike other Medicare contactors, are paid on a purely contingent fee basis, which arguably impacts RAC decisions. RACs identify overpayments using an automated review, complex review or semi-automated review. The type of review utilized is determined by the certainty of the coding error and whether a Medicare guideline exists in relation to the coding error. With each review, the RAC can identify an overpayment because the services were not covered and an overpayment because of a coding error or some other issue (e.g., a duplicated claim). The RAC can request additional documentation from the provider or third party provider. The RAC must allow the provider 45 days to respond to a request and grant one extension to the request to the provider if requested.
The RAC is required to make a determination on the claim within 60 days of receipt of the requested documentation. If an overpayment is identified, the RAC validates the finding and notifies the provider of the error. The MAC is then accountable for recoupment of the overpayment.
Zone Program Integrity Contractor (ZPIC)
ZPICs are solely designed to detect fraud, acting as the “police officer” of the Medicare audit world. ZPIC audits derive from tips from other Medicare contractors, tips from whistleblowers and ZPIS own review of medical claims. High utilization and an abundance of high cost services are the usual suspects to trigger red flags. Unlike RACs, ZPICs are not required to receive prior approval from CMS for selecting billing
issues or post a notice of billing issues targeted by the ZPIC. The timeline to respond during a ZPIC audit is shorter, allowing the provider only 30 days to respond to any requests for information. Providers must be aware that prepayment review rules and deadlines are different from post payment reviews. The Affordable Care Act expanded payment suspensions, providing that payments may be suspended pending an investigation into a credible allegation of fraud unless good cause is shown not to suspend payments. Lastly, ZPICs are distinguished from other types of audits because if the likelihood of fraud or violation of the False Claims Act is determined, ZPICs will refer matters to the FBI, DOJ or OIG for investigation HN and possible prosecution. Richard Cheng is Partner at Shannon, Gracey, Ratliff & Miller, L.L.P. and can be reached at. rcheng@shannongracey.com
10 H e a d n o t e s l D a l l a s B a r A s s o ciation
Jul y 2015
Once again, Bar None’s cast revealed that their abilities extend beyond the practice of law. Celebrating their 30th year, Bar None XXX: Obscenely Funny brought the house down! Led by show director Martha Hardwick Hofmeister, choreographer Rhonda Hunter and producer Tom Mighell, the show played for four nights in June, and thanks to the Dallas Bar Foundation and these hard-working singers, dancers and actors, more than $1.5 million has been contributed to the Sarah T. Hughes Diversity Scholarships, benefitting nearly 50 law students since 1986. For more information, visit www.barnoneshow.com. Photo credits: Scott Alden.
Thank You, Bar None Sponsors!
On behalf of the Sarah T. Hughes Diversity Scholarship, the Dallas Bar Foundation salutes and thanks the following sponsors of Bar None XXX. Their generous contributions not only benefit the scholarships, but they made this year’s show possible.
Mogul
William “Mac” Taylor American Inn of Court Platinum Point Media
Producers:
Attorney at Law Magazine • The Mighell Family • Sarah T. Hughes Alumni Scholars • Texas Lawyer
Directors:
Burdin Mediations • E. Leon Carter • DBA Corporate Counsel Section • ExxonMobil • Farrow-Gillespie & Heath, LLP • Jackson Walker L.L.P. • Law Office of LAWRH • Loncar & Associates • Merrill Corporation • Ricoh Legal • Shackelford, Melton, McKinley & Norton, LLP
Stars:
Altrusa International of Downtown Dallas, Inc. • Brown & Hofmeister, LLP • Cooper & Scully, P.C. • Cowles & Thompson • DBA Bankruptcy & Commercial Law Section • DBA Mergers & Acquisitions Section • DBA Tort & Insurance Practice Section • DBA Trial Skills Section • Goranson Bain, PLLC • Hunton & Williams LLP • Jones Day • John McDowell • Millennium Settlements • Siemens PLM Software
J ul y 2 0 1 5 â&#x20AC;
Dal l as Bar A ssoci ati on l Headnotes 11
Health Care Is Under a Microscope. Jody Rudman Has Seen It All.
JODY RUDMAN
Health care providers need experienced legal counsel in responding to the increase in Accusations of regulatory and coding violations Fraud allegations Criminal investigations A former assistant AG and federal prosecutor, Jody Rudman is uniquely prepared to represent doctors and other clinicians in these critical legal challenges to their licenses and livelihoods. Our firm appreciates your referrals.
J ody R u dm a n
j r udman@ kendal l l awgroup. com
3232 McKinney, Suite 700 | Dallas, Texas 75204 www.kendalllawgroup.com
|
214-744-3000
12 H e a d n o t e s l D a l l a s B a r A s s o ciation
Jul y 2015
Constitutional Limits on the Authority of the Bankruptcy Courts by Jim McCarthy and MaryAnn Joerres
Until Stern v. Marshall, 131 S. Ct. 2594 (2011), a bankruptcy court’s authority to decide the matters before it largely turned on whether a claim was “core” or “non-core,” per 28 U.S.C. §157. Bankruptcy courts could generally handle “core” claims through final judgment. If the parties did not consent to bankruptcy court adjudication of a “non-core” proceeding, a bankruptcy court could hear it and issue proposed findings of fact and conclusions of law, but a final judgment required de novo review by a federal district court. See 28 U.S.C. §157(c). In Stern, however, the Supreme Court announced a new category of claims—“core” claims over which only Article III courts had authority, and over which an Article I bankruptcy court could not enter final judgment. Unfortunately, the case did little to explain which claims were Stern claims; whether the bankruptcy courts could play any role in adjudicating them; and—if so—what procedures were to be followed. Stern also called into question the widespread practice of bankruptcy court adjudication by consent of the parties. Stern imposed confusion and cost on a bankruptcy system that reacts poorly to both. Proceedings that bankruptcy courts had comfortably addressed in the pre-Stern era were now encumbered, slowed, and made more expensive by motion practice and collateral litigation over what Stern meant, and what the courts and parties could do with such claims. Fortunately the Supreme Court’s opinions in Execu-
tive Benefits Insurance Agency v. Arkison, 134 S.Ct. 2165 (2014), and very recently in Wellness International Network Ltd. v. Sharif, 135 S.Ct. 1932 (May 26, 2015), reduce—somewhat— the confusion created by Stern. In Executive Benefits, a unanimous Supreme Court held that, even absent the consent of the parties, a bankruptcy court could oversee pre-trial matters and provide findings of fact, conclusions of law, and recommendations to the district court, but still could not enter final judgment on that claim. Executive Benefits thereby closed the “statutory gap” that allegedly existed because those statutory procedures applicable to “non-core” matters did not facially apply to “core” Stern claims. In Wellness, the Supreme Court tackled an important practical and constitutional question: does Article III permit the exercise of judicial power by the bankruptcy court based upon litigant consent, and—if so—can that consent be implied? It answered “yes” to both parts of that question and held unequivocally that Article III is not violated when the parties knowingly and voluntarily consent to adjudication by a bankruptcy judge. Unfortunately, the Court also declined the opportunity to define Stern claims more clearly, despite having granted certiorari on a second question that would have allowed it to do so. The majority’s focus on the constitutional issue is odd but understandable. Odd, because, the Court will generally avoid a constitutional decision, if a matter can be determined without doing so. Understandable, because the consent issue, by extension, implicated
and threatened not only the bankruptcy courts, but the federal magistrate system. As the Wellness majority noted: “Adjudication based on litigant consent has been a consistent feature of the federal court system since its inception,” and “interpreting Stern to bar consensual adjudications by bankruptcy courts would ‘meaningfully chang[e] the division of labor’ within our judicial system.” Since Wellness itself involved allegedly implied consent, the Supreme Court remanded the case for a determination as to whether Sharif ’s actions in the litigation constituted “knowing and voluntary consent” or whether he had forfeited his Stern argument as to bankruptcy court authority by not timely raising it. The “guidance” that went with that remand was limited, but not inconsequential, as Roell v. Withrow, 538 U.S. 580 (2003) (holding that litigant consent to proceed before a magistrate can be implied by the conduct of the parties) suggests that the traditional factors (e.g. whether the party now contesting bankruptcy
The DBA Community Involvement Committee is coordinating a drive to benefit local charities, including the Austin Street Centre, Big Brothers Big Sisters, Genesis Women’s Shelter, The Family Place, North Texas Food Bank and North Dallas High School. Items needed: men’s/women’s clothing, nonperishable canned food items, hotel/travel-sized toiletries, gently-used luggage/ duffle bags, high school and elementary school supplies, bed and bath linens, home décor items and kitchen supplies. Drop off is at the Belo Mansion on Friday, July 24. For more information, contact Elaine Mosher (elaine@attorneytxs.com) or Tracye McGaughy (tmcgaughy@higierallen.com).
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Jim McCarthy and MaryAnn Joerres are a Partners at Diamond McCarthy LLP. They can be reached at jmccarthy@diamondmccarthy. com and mjoerres@diamondmccarthy.com, respectively.
Don’t miss your opportunity to advertise (print & online) in the #1 “Legal Resource & Expert Witness Guide” in Dallas County. Contact PJ Hines at (214) 597-5920 or pjhines@legaldirectories.com
CHRISTMAS IN JULY Friday, July 24 ~ 9 a.m. to Noon ~ The Belo Mansion ~
court authority initiated the litigation in that court, what it asked that court to do, how long it waited to raise its “objections” to bankruptcy court adjudication, etc.) will be considered. After Wellness and Executive Benefits, district courts can breathe a sigh of relief. They will not have to do it all on their own, because the bankruptcy courts once again have clear constitutional authority to undertake their share of the judicial labor. But Wellness offered little guidance as to which claims were Stern claims, a fact underscored by Justice Roberts’ argument, in dissent, that the Wellness claim in question was not a Stern claim and that Wellness should have been resolved on that issue. Accordingly, courts and litigants will continue to argue over which claims are Stern claims, and whether knowing and voluntary consent can be implied in those circumstances where it has not HN been expressly given.
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Jul y 2 0 1 5
Focus
D al l as Bar A ssoci ati on l Headnotes 13
Health Law & Employee Benefits/Executive Compensation
A New Era of Med-Mal Arbitration? by Michael L. Hood and David M. Merryman
A recent Texas Supreme Court decision changes the landscape for arbitration of medical malpractice claims. In The Fredericksburg Care Co., L.P. v. Juanita Perez et al, 58 Tex. Sup. Ct. J. 452 (Mar. 6, 2015), the Court held that the arbitrationfriendly Federal Arbitration Act (FAA), 9 U.S.C. § 1 et. seq., preempts the more stringent arbitration requirements found in the Texas Medical Liability Act (TMLA), TCP&RC § 74.451. As a result, many providers, especially nursing homes and home health operators, may start including arbitration clauses in their agreements with patients. In the past, few Texas providers would rely on arbitration clauses because they feared violating the TMLA. TMLA Section 74.451 requires that the arbitration agreement state: UNDER TEXAS LAW, THIS AGREEMENT IS INVALID AND OF NO LEGAL EFFECT UNLESS IT IS ALSO SIGNED BY AN ATTORNEY OF YOUR OWN CHOOSING. THIS AGREEMENT CONTAINS A WAIVER OF IMPORTANT LEGAL RIGHTS, INCLUDING YOUR RIGHT TO A JURY. YOU SHOULD NOT SIGN THIS AGREEMENT WITHOUT FIRST CONSULTING WITH AN ATTORNEY. Section 74.451 further states that providers who fail to comply with its requirements risk liability under the Texas Occupations Code or the Texas Deceptive Trade Practices-Consumer Protection Act.
Before Fredericksburg, Texas lower courts routinely rejected the argument that the FAA preempts the TMLA. They reasoned that the McCarran-Ferguson Act (MFA), 15 U.S.C. § 1011-1015, exempts the TMLA from FAA preemption. The MFA is federal law which provides that state law governs the regulation of the business of insurance. In Fredericksburg, however, the Texas Supreme Court unanimously ruled that the MFA does not apply to the TMLA because the TMLA does not regulate the business of insurance. According to Fredericksburg, if the FAA applies to an agreement to arbitrate a healthcare liability claim, and the arbitration agreement satisfies the FAA, courts must enforce arbitration of healthcare liability claims regardless of whether the arbitration agreement complies with the TMLA. These were the facts in Fredericksburg: Fredericksburg operated a nursing home. Elisa Zapata was a patient. She signed a pre-admission agreement that included a standard arbitration clause stating: “Any legal dispute, controversy, demand or claim . . . that arises out of or relates to the Resident Admission Agreement or any service or health care provided by the Facility to the Resident, shall be resolved exclusively by binding arbitration . . . and not by lawsuit or resort to court process . . . .” Zapata died while a patient at Fredericksburg. Her beneficiaries filed medical malpractice claims against Fredericksburg in state court. Fredericksburg moved the trial court to compel arbitration on the grounds that the FAA preempted TMLA Section 74.451. The beneficiaries objected on the grounds that the MFA exempted the TMLA from FAA preemption. The beneficiaries prevailed at trial and before
Opinions of Counsel for Delaware Special Purpose Entities and for Pennsylvania, New Jersey and D.C. Real Estate Transactions We provided the Delaware special purpose entity opinions for 55 real estate loans in 2014. Our firm’s attorneys are also licensed in Pennsylvania, New Jersey, the District of Columbia, and Washington.
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the court of appeals, and Fredericksburg appealed to the Texas Supreme Court. The Court concluded that the TMLA’s indirect effect on insurance costs was only a “tenuous impact” on the business of insurance, not a regulation of the business of insurance. The Court agreed that the Texas Legislature enacted the TMLA to improve the insurance marketplace and to reduce medical malpractice insurance rates. But the Court disagreed that any of that renders the TMLA a statute that “regulates the business of insurance” within the scope of MFA protection. Now that the Texas Supreme Court has opened the door to FAA-friendly arbitration agreements between patients and healthcare providers, providers should ask themselves whether they should seek arbitration. Providers should consider: (1) whether Fredericksburg is final. The beneficiaries seek a rehearing, and many are urging the Court to withdraw its opinion; (2) whether the FAA would apply. In Fredericksburg, the FAA applied because the nursing home received Medicare payments on
behalf of the patient; (3) whether the arbitration agreement would satisfy the FAA. The FAA requires that arbitration agreements be in writing, agreed to by the parties, and cover the claims at issue. But even FAA-friendly arbitration clauses are subject to state law contract defenses, such as duress, incapacity, and lack of authority; (4) the potential advantages and disadvantages to arbitration. Benefits include confidentiality, expediency, experienced decisionmaker, predictability, less adversarial, and less procedural. Drawbacks include waiver of jury trial rights, expense, relaxed rules of discovery and evidence, and limited right to appeal; (5) what arbitration forum and rules would apply; (6) whether the provider can unilaterally determine whether to enforce the arbitration clause; and (7) the effect if other defendants are not sub HN ject to the arbitration clause. Michael L. Hood is a partner at Haynes and Boone, LLP, and David M. Merryman is an associate at the firm. They can be reached at michael.hood@haynesboone.com and david. merryman@haynesboone.com, respectively.
SAVE THE DATE!
DBA Community Day of Service Saturday, October 24, 2015 A day of community service hosted by the DBA’s Community Involvement Committee. If your firm or group has an idea for a project that you would like to organize, please contact elwoodb@gtlaw.com or elwoodb@gtlaw.com.
Congratulations to Darrell Jordan Recipient of the Outstanding 50 Year Lawyer Award Diamond McCarthy is proud to recognize Darrell Jordan, a recipient of the Texas Bar Foundation’s 2015 Outstanding 50 Year Lawyer Award. This is a well-deserved honor that recognizes Darrell’s extraordinary leadership and significant contributions to the legal profession and the community over the last fifty years. Congratulations, Darrell. We are proud to call you our Partner.
diamondmccarthy.com
14 H e a d n o t e s l D a l l a s B a r A s s o ciation
Jul y 2015
Tips when Accepting Credit Cards by Tracey Gavin
In the world of merchant accounts, law firms are unique business entities. Unlike a restaurant or retail store, law firms have special considerations when dealing with credit cards and client funds. Whether you are considering accepting credit cards or already offer an electronic payment option, using stateof-the-art technology will ensure you are paid quickly and securely. Some other tips to ensure a successful transition to the modern ways of getting paid as a law firm merchant: Protect your trust and IOLTA accounts. Do not allow your merchant provider access to your trust account. Most merchant agreements will require you to give access to this account in the event of a charge back or fraud. There are merchant services specific to law firms that correctly protect and safeguard your trust accounts. Avoid storing credit card information. If you bill clients on a monthly basis, you will potentially need the ability
to recharge their credit cards. Accepting credit cards through a secure web-based solution will allow you to avoid keeping sensitive credit card information within the walls of your office. Modern law firms are quickly moving away from the traditional credit card machines, which sometimes require paper storage of client credit card numbers. This also limits the liability and risk to your firm of credit card information falling into the wrong hands. Communicate to your clients. Let clients know what your payment expectations are on the front end by including due dates, late fees, and payment options as part of your fee agreement. It is much easier to establish these guidelines while your client is new and eager to get started. More importantly, continue to communicate to your clients what payment options you provide by including credit card logos or adding “Major Credit Cards Accepted” to your invoices and website. Clients will commonly look for an attorney who provides credit card options. Even popular legal websites such as Martindale-Hubbell have specific search criteria to find
attorneys who accept credit cards. Use the technology you have. Once you make the decision to accept credit cards, be sure to use the payment option that best suits your needs. Depending on your area of practice—and, more importantly, where you interact with your client—there are different choices to accept payment. For example, there are many options to accept credit cards with smart phones, including iPads and laptops. Let your clients do the work. By taking time to establish payment options on your website, clients can run their own credit cards. Not only does this provide a convenience to clients, but it frees up the time you otherwise would spend processing credit card payments. This also allows you to avoid ever seeing credit card numbers, eliminating any responsibility to accept, store, shred, or protect credit card numbers. PCI compliance. When you accept credit cards in your office, you also accept
the responsibility of protecting cardholder data. Be sure your merchant solution is PCI compliant. PCI-DSS is the payment card industry’s security guidelines for merchants. More information can be found on the PCI Security Standards Council website, www.pcisecuritystandards.org.
About LawPay
The LawPay program, is a custom payment solution designed for attorneys. The LawPay program complies with ABA and state requirements for managing client funds. As a member benefit of the Dallas Bar Association, law firms save up to 20–25 percent off standard credit card fees. If you are currently accepting credit cards, we encourage you to compare your current processor with LawPay. To learn more contact (866) 376-0950 or www. HN LawPay.com/dallasbar.
Tracy Gavin is the Marketing Director for LawPay. She can be reached at tgavin@affinipay.com.
COMMUNITY VOLUNTEER OPPORTUNITIES FOR LAWYERS
32nd Annual Philbin Awards Luncheon Tickets Now Available!
Donate to the Christmas in July Donation Drive, contact kzack@dallasbar.org.
Tutor a Child Confined to the Henry Wade Juvenile Justice Center, contact ahernandez@dallasbar.org. Mentor a Child Impacted by Incarceration, contact Mandy Klem at (214) 288-3551. Speak to a Community or Civic Group on a Law-Related Topic, contact mjohnson@dallasbar.org. Participate in the DBA’s Community Service Day, contact elwoodb@gtlaw.com or acavazos@velaw.com.
KEYNOTE SPEAKER Author of Desert Diplomat
EARLY BIRD RATE: TICKETS: $45 | TABLES OF 10: $450 AFTER SEPT. 9: TICKETS: $50 | TABLES OF 10 $500
Wednesday, September 23 | Noon | Belo
For tickets, log on to www.dallasbar.org
WHY DONATE TO THE EQUAL ACCESS TO JUSTICE CAMPAIGN BENEFITTING DVAP? 1. Help provide legal aid to the poor. 2. Receive recognition in Headnotes, Texas Lawyer, D Magazine and The Dallas Morning News. Receive recognition in the DBA’s weekly e-newsletter and on the DBA website and social media pages. Be highlighted in press releases. Be the subject of a feature Headnotes article on you, your
firm or organization.
Receive complimentary tickets to the DBA Inaugural Ball. Plus many more perks!
Donate now to take advantage of these great benefits!
Find out more at
www.dallasbar.org/dvapcampaign Inclusion varies with donor levels.
J ul y 2 0 1 5
Dal l as Bar A ssoci ati on l Headnotes 15
Classifieds
July
EXPERT WITNESS
Mexican Law Expert - Attorney, former law professor testifying since 1997 in U.S. lawsuits involving Mexican law issues: FNC motions, Mexican claims/defenses, personal injury, moral damages, contract law, corporations. Co-author, leading treatise in field. J.D., Harvard Law. David Lopez, (210) 2229494. dlopez@pulmanlaw.com. Economic Damages Experts - Thomas Roney has more than twenty five years’ experience providing economic consulting services, expert reports and expert testimony in court, deposition and arbitration. His firm specializes in the calculation of economic damages in personal injury, wrongful death, employment, commercial litigation, IP, business valuation, credit damage and divorce matters. Mr. Roney and his experienced team of economic, accounting and finance experts can help you with a variety of litigation services. Thomas Roney LLC serves attorneys across Texas with offices in Dallas, Fort Worth and Houston. Contact Thomas Roney in Dallas/Fort Worth (214) 665-9458 or Houston (713) 513-7113. troney@thomasroneyllc.com. “We Count.”
OFFICE SPACE
Far North Dallas- Tollway & Frankford Rd - Office Space Available, 2588 square feet, ready to go! Includes 7 Large Carpeted Private offices, Reception Area, Large Conference Room, Large Kitchen, Storage and Utility Rooms, Ample Parking. One block east of Dallas North Tollway – contact Kevin at (214) 770-4063 or kevin@kevinodavis.com. Park Cities/Preston Center/Toll Road – Spacious window office with adjoining conference room or secretarial space in recently built office suite. Amenities include additional large conference room, receptionist, fax, high-speed color scanner/copier/ printer, parking garage, Internet-wired and Wi-Fi. Email rick@tubblawfirm.com or call (214) 965-8535. Class A Building | Central Expressway | Mockingbird Station | Premier Place - 3 window offices and 1 interior office available for rent in Class A building with move-in June 1, 2015. Located at Premier Place, 5910 N. Central Expressway, 9th Floor, facing south towards Mockingbird Station and downtown Dallas. Access to conference room as well as other amenities, including phone, Internet, copier/ work room, kitchen, file room, etc. Perfect for Solo practitioners and small law practice from 2-to-4 person firm. Office located next to Mockingbird Station which has several restaurants within a short walking distance. Easy access to Central Expressway. For further information, please call Robert at (214) 987-0098 or email robert@grishamlaw.com. Central Expressway | Park Cities. Varying sized offices and cubicles are available for rent. Office with several long-established law practices. Perfect for Solo practitioners and 2-to-3 partner groups. Your space comes with turnkey services, amenities and updated technology at affordable pricing. For pictures, floorplan and greater detail, please visit
us at www.MeadowsLawCenter.com or call (214) 368-7880 Ext 4413. Downtown Dallas – KATY Building. Office available, located in the historic KATY Building directly across from the Dallas County Courthouses. Receptionist, phone system, conference room, Wi-Fi, fax and copier available for tenants use. No lease required. Please inquire at (214) 748-1948. North Dallas – Lincoln Centre. Law firm located at Lincoln Centre has one partner size office and cubicle available. Located at LBJ and the Tollway; two conference rooms; break room/kitchen; copier; Email: dallasipfirm@gmail.com for more information. Park Cities/Central Expressway – Upscale law firm has Class A office space with high-end finish-out available. Located at 8150 Central Expressway in Dallas. Up to 3 partner offices, 6 associate offices, and 6 interior offices available. Access provided to 2 conference rooms, large boardroom and kitchen, as well as office amenities/equipment such as phone, Internet, copier, etc. Free surface and garage parking. Please contact Chelsea at (214) 367-6000. Richardson – 75 & Spring Valley. Private office space and suites for lease in Richardson. Excellent Location off Spring Valley two blocks east of I-75. Perfect space for Attorneys/CPA’s/Title Company/Insurance Agent/Architects. Availability of Two Suites. Amenities Include: Receptionist service, Use of standard conference room, Complimentary coffee service, Full kitchen, copier/scanner available for an added charge. Flexible lease terms. All utilities included. Free parking and 24/7 access. Additional information available please send email to: janice@nacollawfirm.com. Ready To Practice Law “Like A Boss”? No Law Firm Required. Independent business attorneys and litigators need a professional, secure place to work, meet clients, and network - NOT just another executive suite, sublease, home office or coffee shop. VENUE is a “working clubhouse” built BY attorneys, exclusively FOR attorneys. Occupying two top floors in a landmark downtown building, VENUE provides the resources, training and support attorneys need to launch their firms and accelerate their practices. In addition to workspaces and offices, VENUE members will have access to: 30+ hours CLE & management/development training annually, exclusive networking & social events, and an elite network of 100+ local partner-level peers. VENUE is the “Practice of Law Made Perfect.” For info or to schedule a tour: www.attorneyvenue.com. Ready For A Change? Leaving an existing firm or you are a solo practitioner? Thinking about an Executive Suite? Join an office of established attorneys with all the benefits of being in a law firm environment, being able to brainstorm with seasoned attorneys. Ours is a relaxed, yet professional environment in tasteful, bright offices in a class A building overlooking a lake and with a view of downtown. Includes administrative stations,
Need Help? You’re Not Alone. Texas Lawyers’ Assistance Program…………...(800) 343-8527 Alcoholics Anonymous…………………………...(214) 887-6699 Narcotics Anonymous…………………………….(972) 699-9306 Al Anon…………………………………………..…..(214) 363-0461 Mental Health Assoc…………………………….…(214) 828-4192 Crisis Hotline………………………………………..1-800-SUICIDE Suicide Crisis Ctr SMU.…………………………...(214) 828-1000 Metrocare Services………………………………...(214) 743-1200 More resources available online at www.dallasbar.org/content/peer-assistance-committee
conference room, kitchen, copier, phone system, reserved garage parking, and other amenities. Plenty of guest parking and next to the DART rail system. One executive office or two smaller offices. If this sounds like your future office home, give us a call at (214) 750-1600 for details. Pearlstone Suites in the West End of downtown Dallas are unique new law offices combined with professional law firm marketing services to help attorneys launch or grow a solo practice or small firm. Suites include these amenities at no additional cost: Direct dial phone with personalized voicemail and call forwarding, high speed Internet access, IT support, law office reception, onsite building security, conference rooms, kitchen and coffee service, fitness center, building directory listing, all utilities and CAM charges. Marketing services available include websites, branding, brochures, strategy, coaching and more. Preleasing discounts available until June 30. Visit www.pearlstonesuites.com or call (214) 446-3943. East Dallas – I-30 & St. Francis. Why Rent When You Can Buy For Even Less? Two story, 6970 sq. ft. office building in east Dallas, corner of I-30 and St Francis exit. Walk across parking lot to JP court at County sub-courthouse. Hop on I-30 for EZ and fast access to downtown and courts. Use whole building yourself, or rent part of it to cover mortgage, and adjust it to suit your expanding practice and need for more space. Your occupancy could be FREE. Great, unique investment opportunity. Lots of parking. Available immediately. Possible seller financing. Don (214) 682-6425 (principal). Downtown Dallas – Arts District. Offices available for rent with law firm located in Downtown Dallas Class A, Arts District building. Amenities include conference room, law library, secretarial station, kitchen, parking garage, photocopy/scanner/postage/facsimile and related amenities. Contact Laura at (214) 922-9265. Uptown – McKinney Avenue. Furnished single office with secretarial space available if needed within small real estate law firm located at 4054 McKinney Avenue. Shared conference and break room, furniture, copier, fax, DSL & phone equipment are available if needed. No long term commitment and a monthly rate of $850. Call (214) 520-0600. Sublease at Campbell Centre I - Central Expressway & Northwest Highway area. Nice window office space ($2,600/mo) with separate space for assistant (addt’l $500 / mo); 12th floor. Space includes shared use of three conference rooms, kitchen, and covered parking garage spaces. Amenities include shared receptionist, phone system, copier, scanner, and fax. Please contact Mr. Hall at (214) 691-7781.
POSITION AVAILABLE
Emmert & Parvin, LLP is seeking the addition of 2-3 attorneys with established practices in commercial litigation, family law and probate. Our compensation formula has no billable hours requirements and allows you to set your hours. Contact Chris Parvin for more information at chris@emmertparvin.com. Paralegal Wanted: Duffee+Eitzen, OakLawn/Turtle Creek area boutique family law firm, is looking to hire a paralegal with at least 5 years heavy family law experience. Competitive compensation package. Please send resumes to meitzen@duffee-eitzen.com. Civil Trial Attorney Position: 3 years’ minimum experience in civil law. Other
requirements: Please do not be afraid of hard work. You have to be able to laugh at yourself, but never at others. Lose the ego. Treat staff like you would treat your best client. Be willing to do things our way and don’t throw people under the bus. The Bassett Firm provides competitive salaries and exceptional benefits. Interested applicants send resume to nmenchaca@thebassettfirm.com. Real Estate Attorney. Fort Worth law firm seeking attorney with at least 3 years of Real Estate experience. Please send resume and salary requirements to asincleair@bamolaw.com. Health Law Attorney Needed. Experience in healthcare regulatory and payment matters - Medicare, Medicaid, licensing, transactional or criminal law services to healthcare providers. We prefer a problem solver with a disciplined work ethic, excellent writing skills, good attitude who is self-motivated and will participate in marketing & seminar presentations. Please email resume to markskennedylaw@msn.com. Legal Aid of NorthWest Texas (“LANWT”) currently has various openings throughout its firm at various locations. We are a Section 501(c)(3) nonprofit Texas Corporation. LANWT provides free civil legal services to eligible low-income residents in 114 Texas Counties. If you are interested in joining a great team that offers you the opportunity to rapidly develop litigation skills in court, a generous health benefits package, and the ability to be of service to others, we encourage you to visit LANWT’s career site at www.lanwt.org.
SERVICES
Of Counsel Energy Attorney. Does your matter have an energy component that needs to be addressed by an experienced energy attorney? As the energy industry continues to grow, many firms intake matters that do not necessitate hiring a full time associate nor retaining a partner exclusively for oil & gas support. If you have a project or a series of projects that require primary or ancillary assistance from an experienced counsel who possesses needed knowledge of the nexus of oil & gas and corporate law, please do not hesitate to contact me using the phone number or email address set forth herein. (214) 264-1414 or ted@teslawfirm.com. Immediate Cash Paid For Diamonds and Estate Jewelry. Buying all types of jewelry and high end watches. Consignment terms available @ 10-20 % over cash. For consultation and offers please call J. Patrick (214) 739-0089. Energy Acquisition(s): I buy any size royalty(ies), mineral(s), working interest(s) and try to reach (and pay) the sellers asking price. I am a licensed attorney and have been making oil and gas purchases for 35 +/- years. E-mail to bleitch@prodigy.net or call Brenda at (800) 760-9890 or (214) 720-9890 for a friendly and quick analysis and response. Helping trial lawyers win cases. Attorney with outstanding research and writing skills available for hourly projects. More than 30 years’ experience; law review, former judicial clerk. (972) 2438444; www.trialassistance.com. To place an affordable classified ad here, contact Judi Smalling at (214) 220-7452 or email jsmalling@dallasbar.org.
Connect jobseekers with employers in the legal field. Run your ad in the DBA’s online Career Center. www.dallasbar.org/career-center.
16 H e a d n o t e s l D a l l a s B a r A s s o ciation KM_HN_2015 July gym.pdf
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