USLAW Magazine - Spring 2019

S P R I N G

Through the Thicket: Issues When Working In, or With, the Legal Cannabis Industry p30

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The State of U.S. Immigration Law from I to V (ICE to Visas) p 40

First Line of Defense: How Businesses Use the First Amendment to Overrule Government Laws and Regulations p22

ADDRESSING AUTO INSURANCE ISSUES SURROUNDING AUTONOMOUS VEHICLES p12

Expand and Contract: Developments in Worker’s Compensation Exclusive Remedy p20

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REVEALING THE CAUSE. MITIGATING THE RISK. Engineering, Investigation and Analysis since 1970

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contents

FEATURES:

P3 Projects Take Flight

By Joel D. Pedersen • Baird Holm, LLC............................................................................ page 2

Opportunity Knocks: How You and Your Client Can Take Advantage of Opportunity Zones

By Justin Hage and Brett Miller • Bingham Greenebaum Doll, LLP................................. page 4

Liar Liar Pants on Fire: Why we Should File More Motions to Dismiss for Fraud

By Elizabeth “Betsy” Burgess and Christopher Barkas • Carr Allison............................. page 6

Six Cutting Edge Technologies to improve Safety on Construction Sites

Thomas S. Creel • Carr Allison .................................................................................... page 10

When the Driver is a Computer: Addressing Auto Insurance Issues Surrounding Autonomous Vehicles

Kent M. Bevan • Dysart Taylor Cotter McMonigle & Montemore, PC.......................... page 12

Developing Data Privacy Law and the Standard for “Reasonable Security Measures”

By Hilary Wells and Holly White, Lewis Roca Rothgerber Christie LLP......................... page 14

GOODBYE, GRANDFATHER: How Property Renovations Can Create Compliance Issues with Current Building Codes

By Rebecca K. Hinds and M. McKenzie Reed Martin, Tate, Morrow and Marston, P.C...................................................................... page 16

Regulations Remain Hazy around CBD Use in Supplements

By Marc S. Ullman • Rivkin Radler LLP........................................................................ page 24

Structured Settlements In Workers’ Compensation Claims: A Creative Approach To Settlement

By Brian Annandono • Structured Financial Associates............................................... page 26

To Be or Not to Be… A Fiduciary: Examining the Revised CFP Code

By Alexandria M. Ransom • Simmons Perrine Moyer Bergman PLC ........................... page 28

Through the Thicket: Issues When Working In, or With, the Legal Cannabis Industry

By Michael McGrory • SmithAmundsen ...................................................................... page 30

Helmets, Seatbelts, and Comparative Fault

By Martin S. Driggers, Jr. and Brandon Gottschall Sweeny, Wingate & Barrow, P.A.................................................................................. page 32

We’re Being Sued WHERE? Personal Jurisdiction In The Electronic Age

By Alyssa Reiter • Wicker, Smith, O’Hara, McCoy & Ford, P.A..................................... page 34

Using Advanced Technology to Understand Accidents at Night Involving Pedestrians

Fawzi P. Bayan, CSP • SEA, Ltd................................................................................... page 36

BRAZIL’s GENERAL DATA PROTECTION LAW: an important move towards legal certainty for data-driven businesses

The Fast & Furious World of Second Requests

Expand and Contract: Developments in Worker’s Compensation Exclusive Remedy

By Keith McDaniel & Kristen Burge McCranie Sistrunk Anzelmo Hardy McDaniel & Welch................................................. page 40

By Tomás Filipe Schoeller Ribeiro Paiva and Kauê Almeida Curti Mundie e Advogados................................................................................................... page 18

By Michael J. Nunez and Kelsey L. Maxwell • Murchison & Cumming LLP.................. page 20

First Line of Defense: How Businesses Use the First Amendment to Overrule Government Laws and Regulations

By Peter Ostrega • Consilio......................................................................................... page 38

A Solution in Search of a Problem: Discord Over Proposed Changes to Coporate Depositions The State of U.S. Immigration Law from I to V (ICE to Visas)

Jennifer Parser • Poyner Spruill LLP............................................................................. page 42

By William S. Fish, Jr. • Hinckley Allen......................................................................... page 22

DEPARTMENTS: From the Chair’s Desk................................................ page 1 Firms On the Move......................................................page 46 Faces of USLAW..........................................................page 48 Successful Recent USLAW Law Firm Verdicts / Transactions....................................page 50

Pro Bono Spotlight...................................................page 52 About USLAW .............................................................page 53 USLAW NETWORK SourceBook......................................page 56 Spotlight on Corporate Partners.............................page 60

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from t h e

Chair’s Desk

Publisher Roger M. Yaffe Editor Connie Wilson Art Director Jeff Freibert • Compass Creative

BOARD OF DIRECTORS

Kevin L. Fritz, Chair

Lashly & Baer, P.C., St. Louis, MO

Dan L. Longo, Vice Chair

I am pleased to share with you the Spring 2019 issue of USLAW

Murchison & Cumming, LLP, Irvine, CA

Magazine. This is one of many complimentary client resources USLAW

Kenneth B. Wingate, Secretary/Treasurer

produces throughout the year that share industry, practice area and

Sweeny Wingate & Barrow, P.A., Columbia, SC

jurisdictional knowledge on a wide array of topics. USLAW Magazine

Bradley A. Wright, Assistant Treasurer Roetzel & Andress, Akron, OH

articles are written by USLAW member firms and USLAW’s exclusive

Nicholas E. Christin, Law Firm Management Director

corporate partners. As you peruse the pages, you will read about the

Wicker Smith O’Hara McCoy & Ford P.A., Coral Gables, FL

Amanda P. Ketchum, Client Liaison Director

rise in P3 projects, opportunity zones, tech updates for construction

Dysart Taylor Cotter McMonigle & Montemore, PC, Kansas City, MO

sites, insurance considerations with autonomous vehicles, U.S. immi-

Michael P. Sharp, Special Projects Director

gration updates, the cannabis industry and so much more. You also will read about attorneys’ outreach in their communities, trial successes and industry honors.

USLAW NETWORK was launched with the purpose of providing members and their clients with a network of firms that would deliver the capability to respond quickly, efficiently and economically to client needs.

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Please connect with us. Follow us on Twitter (@uslawnetwork) or join our USLAW LinkedIn Group to stay current on legal, legislative and jurisdictional news regularly shared by our members. Take advantage of the many resources available throughout the year and let us know how we can help you.

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Please enjoy this complimentary issue of USLAW Magazine. Thank you

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for your support of USLAW.

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P3 Projects Take Flight Joel D. Pedersen

Public private partnerships (“P3s”) are poised to accomplish much-needed revitalization, infrastructure renewal, and “dream big” projects. This article answers common questions about P3s – what they are and what types of projects can benefit the most.

It also provides some context and history along with a summary of current state legislation enabling P3s plus pros/cons and costs to consider.

P3s offer more collaborative solutions to deliver large construction projects on time and on budget. Now more than ever, opportunities abound for the public and private sectors to collaborate. P3s (also known as “cross-sector partnerships”) are legal agreements to optimize this collaboration.

Combining public and private expertise, skills, resources and capabilities is a highly effective response to this growing need.

TEAMWORK

Teamwork can realize efficiencies and long-term cost savings over the life of the improvements. Owners, designers and builders collaborating can better optimize for efficient, long-term operations. Surveys conducted and reported by KPMG have concluded that traditional project delivery methods for large project owners in the public sector miss expectations in 90% of reported cases! Bringing the owner, architect, and contractor together early on keeps

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projects on a better track.

It’s important to note that P3s are not a funding source on their own. The cost savings over time and ability to complete projects sooner are the big advantages of using P3s. Compared to other project delivery methods, P3s are succeeding where traditional design, bid, build (DBB) projects offer disappointing results, especially over the life cycle of a project.

The life cycle approach takes a project from conceptual design through operations and maintenance of 30 years or more. Many design-build advocates know the advantages of bringing the team in early to effectively design and build to a budget. P3s amplify these advantages. You build your own house better when you plan to live there for 30 years!

WHAT ARE P3S?

P3s are partnerships in the best sense.

They accomplish shared goals beyond what the partners could do acting alone. P3s aim to provide the best available project team along with focused project governance.

The result: projects get done on time and on budget, an assurance that all involved demand.

There is no single definition for P3s.

The Federal Highway Administration takes a very broad view: Any public project shifting risk to the private sector is a P3, including design-build projects. The National

Conference of State Legislators uses a more helpful P3 continuum diagram that spans from traditional DBB (Design, Bid, Build) to full privatization BOO (Build, Own, Operate) at its website.

For this article – P3s are an effective “on time and on budget” contracting tool to improve project outcomes compared to traditional project delivery. P3s can bring an integrated “project team” together to plan and implement large projects, sometimes including long-term operations and maintenance. Of course, all projects encounter difficult problems. P3s get the right team around the table to focus on solving problems and keeping projects on track.

P3 PROJECTS TAKE FLIGHT Courthouses, higher education facilities, sports facilities, and infrastructure owners are the primary owners that are seriously considering P3 alternatives.

Deploying P3 project delivery options mitigates risks and improves outcomes. The Fred & Pamela Buffett Cancer Center in Omaha, Nebraska, used a CM-at-risk project delivery with an integrated P3 project team that delivered a very complex project on time and under budget. Successful P3 projects not only demonstrate the advantages of the integrated team approach, but they also set the stage for collaboration into the operations of new facilities. Because of the com-

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lation. The summary describes nearly half of means you cannot use a structure that plexity and up-front costs, P3 options are those 36 as having “broad” P3 enabling legbetter for larger projects. Pennsylvania is worked in College Park and plug it into islation. Colorado, Texas and Virginia might using a P3 to replace 558 bridges throughSpringfield. If the public process is predebe the best starting points for those considout Pennsylvania more rapidly. Using a P3 termined to prefer traditional project delivering new legislation. Supporting P3s with helped reduce the estimated average cost ery, P3s might be too much change. Simply adequate technical assistance can be chalto design, build and maintain each bridge put, the metrics for success are different lenging, especially outside large urban cenfrom more than $2 million to about $1.6 for P3s by design. Extracting concessions ters. States are using centralized resources million. A P3 concessionaire/construction from contractors is an easier way to keep and guidelines to improve protections and joint venture is doing the work for a total score on projects compared to using P3s. improve results with dedicated P3 offices. estimated combined project cost of nearly The advantages of integrated project plan$900 million. ning and implementation are not

The best P3s infuse their projalways self-evident, especially in ects with the combined capabilicommunities that are accustomed ties and resources of the partners to all-out competition on every • Over $20M • Coalitions throughout the life cycle of a projcomponent of public projects.

• Multiple owners • Revenue Producing ect. Ideally, the planning includes Finally, government partners may outreach and revitalization efforts lose some of their legal defenses.

• Diverse Stakeholders • Specialized build out in the supporting community.

Costs – Legal, insurance, cost con• Complex Funding • Multi-year Construction The callout box above lists several tainment • Donors Schedule factors supporting the use of P3s A special purpose entity (SPE) to consider. or development corporation is

There are many capable expart of the P3 toolbox. While not perts to help project funders conrequired, it is worth considering sider their P3 options. Lawyers even though there may be legal certainly help as do most design and insurance costs. These entiand engineering firms. Other fities will have separate costs, such nance and accounting firms have as liability and directors and offidedicated teams working in P3s. cers insurance. Bringing experts Early in the RFQ/RFP process is in early and hosting additional the best time to seek expert help. team meetings will have associated costs. Several tools to consider are P3 PROJECTS — a build-to-budget delivery with CONTEXT AND HISTORY open cost reporting for the prime

Many commenters attribute contractor. These features offer an thought leadership for today’s P3s independent accountability tool to Great Britain or more broadly beyond what is customary. Experts to Europe and India. The private Source: FHWA can help identify and evaluate the sector in the United States, howcosts for your particular project.

P3 PROS AND CONS — ever, has always been a huge part of our inCOSTS TO CONSIDER frastructure and “dream big” solutions: the CONCLUSION Hoover Dam, Tennessee Valley Authority,

Pros – Collaboration, easier course correc P3 projects are taking flight. They proEisenhower Interstate system, railroads, tions, and timely, better informed decisions vide flexible solutions to complete more U.S. Air Mail or the first U.S. Navy expediP3s excel when the partners effectively colprojects sooner rather than later and often tion to the North Pole. The private sector laborate to get the project done right. That save both time and money. P3 teamwork clearly has a long-standing role of “heavy means everyone expects course corrections effectively responds to challenges for many lifting” on a wide variety of important puband discourages disputes. Because of this large projects. P3s are a useful option to lic projects in the United States. built-in flexibility, P3s are more effective in consider for your next large project. responding to input and changing condiFEDERAL ASSISTANCE tions. Effective collaboration allows P3s to The Transportation Infrastructure function in situations that would undo a Finance and Innovation Act (TIFIA) Program competitively awarded project, sending it Joel D. Pedersen is an attorcurrently provides federal loan assistance to back to the starting point. P3s often hanney with Baird Holm, LLC transportation-related P3s. Federal authorizadle changes in technical details more efin Omaha, Nebraska. He is fectively. The right P3 structure provides tion for private activity bonds (PABs), certain a former vice president and tax provisions, and technical advice through better informed decisions and improves general counsel, University of quality engagement with stakeholders. the U.S. Department of Transportation Nebraska. Joel has served as (DOT) are other forms of federal assistance

Cons – Too much change, different metrics legal counsel for more than currently provided for P3s. for success, project control $1B in successful projects, inSTATE AUTHORIZATIONS P3s are different. While many experts and cluding the Fred & Pamela Buffett Cancer Center,

As of a June 2018 summary prepared resources can help the agreements take Baxter Arena, Nebraska Innovation Campus, by the Federal Highway Administration, 36 shape, each P3 needs to be unique. Owners Antelope Valley and Haymarket Ballpark. states have some form of P3 enabling legisneed a custom fit for each project. That 1

Factors Supporting P3

The Product Liability Risk Retention Act of 1981 initially created risk retention groups. The LRRA expanded the concept of risk retention groups to apply to commercial liability insurance.

1986 U.S.C.C.A.N. 5304

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Opportunity Knocks How You and Your Client Can Take Advantage of Opportunity Zones

By Justin Hage and Brett Miller Bingham Greenebaum Doll, LLP

Buzz has been building in the investment and economic development communities about the new Opportunity Zones Program made law as part of the tax reform package at the end of 2017. The program’s goal is to incentivize investment in distressed census tracts in communities around the country. However, since the program’s creation, the federal government has been slow to introduce regulations, which has caused many to hold off on investing in an Opportunity Zone. Despite the slow adoption of rules, the potential tax savings through the next 10 years – and beyond – has created a tremendous amount

of interest in the program – not just in the real estate investment community.

WHAT ARE OPPORTUNITY ZONES?

The Opportunity Zones Program was established in the Tax Cuts and Jobs Act of 2017 as a way to transform economically distressed rural and urban communities through development investment. Specific areas are designated (using the same standards as those for New Market Tax Credits) as certified census tracts by the U.S. Department of Treasury. States nominated up to 25 percent of their qualified census tracts based on a range of factors, includ-

ing likelihood of attracting short- and longterm investment.

There are 8,764 certified opportunity zones, which include all 50 states, the District of Columbia, and Puerto Rico.

However, investors cannot just buy land or a building in an Opportunity Zone and receive the tax benefits. Investors must reinvest capital gains within 180 days of the gain realization event through a Qualified Opportunity Fund (QOF). The QOF is the investment vehicle, which is organized as either a corporation (both S- and C-corporations) or partnership (including limited liability companies, but not sin-

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gle-member) for the purpose of investing in an Opportunity Zone. The QOF must hold at least 90 percent of its assets in Qualified Opportunity Zone (QOZ) property, which is a business property, stock or partnership interest.

The proposed regulations from the Internal Revenue Service issued Oct. 19, 2018, are almost exclusively geared toward real estate development (as opposed to operating businesses). This is primarily because the QOZ property needs to remain in the zone to receive the tax benefits.

The White House sees the importance of this program for breathing new life into economically distressed areas. President Trump signed an executive order Dec. 12, 2018, which established the White House Opportunity and Revitalization Council and directed federal agencies to prioritize funding (which includes loan guarantees, grant funding, infrastructure spending, and crime prevention funding) for Opportunity Zones.

ATTRACTIVE TAX ADVANTAGES

Both the Treasury Department and IRS issued proposed guidance in 2018 detailing how investments will be taxed and how other program elements will function.

The proposed regulations clarify what gains qualify for deferral, the parameters for Opportunity Funds, which taxpayers and investments are eligible, and other guidance.

In announcing the proposed regulations, Treasury Secretary Steven Mnuchin estimated the program will lead to $100 billion in private capital invested in Opportunity Zone areas. How will the program attract enough investors and dollars to make this a reality? Through attractive tax advantages.

The Opportunity Zone Program provides three tax benefits when investing in a QOF – temporary deferral, partial exclusion, and permanent exclusion.

• Temporary deferral (for pre-investment gains) – Capital gains reinvested in a QOF will not be taxed until 2026, or when the investment is disposed of, whichever date comes first.

• Partial exclusion (for pre-investment gains) – An investor who keeps the reinvested capital gains in the QOF for five years can exclude 10 percent from taxation and can exclude 15 percent for a holding period of seven years.

• Permanent exclusion (for gains derived from QOF investment) – If the investor holds the investment in the QOF for at least 10 years, then the investor is eligible for an increase in basis of the QOF invest-

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ment equal to its fair market value on the date that the QOF investment is sold or exchanged (meaning any gains the investor accrues, after the investment in the QOF, are permanently excluded after 10 years).

QOF INVESTMENT EXAMPLE

For example, if an investor sold land for $500,000 (held for more than 12 months with a tax basis of $100,000), then the investor would normally pay 23.8 percent (assuming a 20 percent long-term capital gains tax and 3.8 percent net investment income tax) in federal income tax, leaving $304,800 (before state taxes).

If the investor deploys the capital gains in a QOF within 180 days of the sale of the land, holds the QOF investment for 10 years, and then sells it for $2 million, the following will occur: 1. Temporary deferral of the $400,000 (pre-investment gain); 2. Partial exclusion of 15 percent on the pre-investment gain (pay long-term capital gains tax on $340,000); and 3. Permanent exclusion of $1.6 million (gain derived from QOF investment).

The partial exclusion of the pre-investment gain leads to a savings of $14,280 ($80,920 as opposed to $95,200 when the land was sold.) The exclusion for gain derived from the QOF investment leads to a savings of $380,800 (based on 23.8 percent rate) for a total savings of $395,080.

The program structure encourages long-term investing, so those who stick with a QOF investment for at least 10 years will receive the most financial benefit. The Opportunity Zones keep their designation for just 10 years, but under the proposed regulations, investors can keep their investments in a QOF through 2047 without losing tax benefits.

LURING INVESTMENT DOLLARS

States and municipalities are eager to capture the capital that could be infused in their communities as a result of this program. They have set up websites with information about how the Opportunity Zone Program works, seeking to lure investment dollars to their struggling areas. For example, a group of public and private entities created an online deal portal — called the Opportunity Investment Consortium of Indiana — for Opportunity Zone investment projects in Indiana.

Large institutions are also establishing QOFs. Goldman Sachs, Washington, D.C.based Fundrise, and hedge fund firm EJF Capital have announced the creation of QOFs. PNC Bank has also created a QOF

and will be investing gains owned by the bank into it.

The proposed regulations released in October 2018 are just the beginning of clarity on the Opportunity Zones Program.

Comments on those regulations were due

by Dec. 28, 2018, and the final rule should be issued in the coming months.

NEXT STEPS Investors and their counsel should consider these factors when evaluating a potential Opportunity Zone investment: 1. Realized eligible capital gains must be reinvested by Dec. 31, 2019 to maximize the partial exclusion benefit (15 percent for pre-investment gains).

2. There are no special requirements for how the initial capital gains are utilized prior to making the QOF investment.

3. Although the long-term capital gains tax will be deferred, it will be due when the investor exits the QOF investment, so the investor should consider holding back some portion of their initial realized gains.

Once the federal government releases its final rule for the Opportunity Zones Program, more investors may be comfortable participating in the program. Those who invest in a QOF long-term could see substantial tax savings as well as positive growth in an economically distressed community. If you are interested in investing in a QOF, consult with your attorney and/or tax professional to determine what fund may be the right fit for your objectives.

Justin Hage is an attorney with the law firm of Bingham Greenebaum Doll, LLP in Indianapolis, IN. His practice focuses on economic development, real estate and government services specializing in site selection and the procurement, negotiation, compliance and administration of economic development incentives for clients locating or expanding their businesses.

Brett Miller is a Partner with the law firm of Bingham Greenebaum Doll, LLP in Indianapolis, IN. He has significant experience with many of the issues on which the IRS currently focuses its resources.

His tax practice includes a practical knowledge of a wide array of state and federal taxation.

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Liar Liar Pants on Fire Why we should file more Motions to Dismiss for Fraud

Elizabeth “Betsy” Burgess and Christopher Barkas

Historically, Motions to Dismiss for Fraud on the Court have been known as difficult, if not impossible, motions to win.

This is primarily because the ultimate sanction sought is the fatal dismissal with prejudice -- the harshest sanction a Court can issue. This understanding discourages some attorneys from spending the time and effort to pursue such a Motion, even when armed with demonstrable proof of a plaintiff lying or engaging in misrepresentation about a material issue.

However, recent national trends suggest Judges and Appellate Courts are becoming more receptive to these Motions, signaling a new lack of judicial tolerance for litigants playing “fast and loose” with the truth. The fraud we are talking about is fairly common: testimony that conflicts with surveillance, incomplete or evasive testimony that conflicts with medical or employment records, fabricated evidence, and half-truths or partial omissions on critical

Carr Allison

matters central to the case.

Additionally, and importantly, there are strategic benefits to filing these Motions, regardless of the outcome, that may justify the time and expense many times over. This article will explore both the changing legal landscape and the strategic advantages a movant may consider when contemplating filing a Motion to Dismiss for Fraud.

RECENT NOTABLE RULINGS ON MOTIONS TO DISMISS FOR FRAUD IN STATE AND FEDERAL COURTS 1. State Courts

Florida Courts are leading the way in granting and upholding dismissals for fraud. In a recently upheld dismissal for fraud, the plaintiff’s deposition testimony conflicted with medical records obtained by subpoena. The plaintiff blamed “poor memory” among other excuses for the discrepancies. The judge found the deposition testimony patently false, and found

the plaintiff had “fraudulently concealed” evidence directly related to his claim for damages. The Appellate Court affirmed the dismissal and noted the false testimony about prior injuries was “at the very heart” of the case. The Court further stated the plaintiff’s attempt to conceal the information was nothing less than an “unconscionable scheme calculated to interfere” with the proper adjudication of the matter.1 In Florida, even an attempt to obfuscate the discovery of facts relating to causation or damages, whether ultimately successful or not, warrants dismissal with prejudice.2 Additionally, only full and complete honesty is acceptable. “Being truthful about some facts while denying or omitting others does not constitute the truthful disclosure of facts on which the integrity of the civil litigation process depends.”3 So in Florida, if a plaintiff is even partially dishonest about a relevant matter, the case may be dismissed for fraud.

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Other states are also signaling increasing intolerance for fraud. To highlight a few, in October 2017, a Texas Appeals Court upheld a dismissal for fraud where the plaintiff’s affidavit conflicted with bankruptcy filings, showing how easily accessible (even public) records can assist in identification and reliable proof of fraud.4 In November 2018, a New York Appeals Court vacated a Judgment due to plaintiff’s fraud and entered monetary sanctions. The Court’s language revealed its frustration, as the ruling states, “The Plaintiff hopes that the fraud it has perpetrated on this Court can be concealed under the guise of a wordy Settlement Agreement and the Defendants’ purported waiver of their rights. The Court hereby shatters any such hope by the Plaintiff…”5 Additionally, in December 2018, an Ohio Appeals Court upheld a finding of dismissal for fraud on the Court where a litigant forged a signature on a document. Again, the Court again voiced its distaste for the fraudulent conduct with choice words, stating, “falsification of documents ….embarrasses the court as well as brings it into disrespect.”6 2. Federal Courts

A Motion to Dismiss for Fraud typically is more difficult to prevail upon in Federal Court. The federal standard for dismissal for fraud is more stringent than many state court standards, as it requires a showing of actual prejudice to the movant and highly favors lesser sanctions. However, despite the heightened bar, the federal judiciary recognizes there are circumstances when dismissal is reasonable and appropriate.

Penalizing fraudulent conduct “is necessary to the integrity of the courts, for tampering with the administration of justice in this manner involves far more than an injury to a single litigant. It is a wrong against the institution set up to protect and safeguard the public.”7

Examples of the type of fraudulent conduct which has justified dismissal under Rule 41(b) include the following separate situations: 1) where a plaintiff engaged in “a pattern of deception” and filed pleadings and motions under a false name, 2) where a plaintiff failed to produce or destroyed record evidence and intentionally misidentified a witness, 3) where a plaintiff fabricated evidence and committed perjury, and 4) where plaintiff engaged in obstruction

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of access to discoverable evidence by failing to disclose a treating physician and subsequently lying at his deposition when questioned on the same subject.8 These cases show that where fraud is demonstrable on a material issue, and the defendant has been prejudiced, defense attorneys should not be reluctant to file a Motion to Dismiss for Fraud in Federal Court.

fraud to the judge in an evidentiary hearing, subject to cross-examination and direct questioning by the judge. It is valuable to know in advance how the plaintiff intends to rationalize discrepancies and/or misrepresentations to a jury if the case is allowed to move forward to trial, and how he or she will respond to cross examination on these subjects.

STRATEGIC REASONS TO FILE MOTIONS TO DISMISS FOR FRAUD 1. Availability of Alternate Sanctions

While a Motion to Dismiss for Fraud may be legally viable, due to the severity of the ultimate sanction, judges may be understandably hesitant to dismiss the case altogether. Fortunately, dismissal is not the only sanction available or worth seeking.

Judges may use their discretion to issue lesser sanctions they deem appropriate.

Defense counsel should be proactive in suggesting alternate sanctions if the judge is receptive to the fraud arguments, but perhaps is signaling he or she feels dismissal would be too harsh. This tactic is helpful where a material misrepresentation may not raise to the level of outright dismissal, but may justify alternate sanctions, such as striking portions of pleadings or claims for certain categories of damages (for example, if a plaintiff has lied about post-accident income, ask the court to strike the plaintiff’s wage claims).

4. Leveraging a Reasonable Settlement

A well-supported Motion to Dismiss for Fraud puts a plaintiff and his or her attorney in an uncomfortable position. A plaintiff’s attorney may be unaware of the fraud until the Motion is filed, but should recognize the importance of credibility and the potentially serious implications with a jury, even if the case is not dismissed for fraud.

Both the plaintiff and his or her counsel may be more willing to discuss reasonable or nominal settlement when faced with the prospect of a dismissal or, at the least, a potentially devastating cross-examination at trial. If settlement negotiations have stalled or plaintiff’s counsel refuses to negotiate in a reasonable range, a Motion to Dismiss for Fraud can get attention and apply valuable pressure.

2. Educating the Judge about the Weaknesses of Plaintiff’s Case

A clearly drafted Motion to Dismiss for Fraud will, even if not fully granted, serve the purpose of educating the judge about the weaknesses of a plaintiff’s case that will be pursued through cross-examination at trial if not dismissed, and will certainly be the subject of motions in limine nearer to trial. If a judge is educated about the nature of the fraud in advance, and the relevance of such fraud to the defense of the case, the judge will be more prepared to address (and deny) objections and motions in limine by plaintiff’s counsel than if the judge is learning about the issue for the first time at the pre-trial hearing.

3. Flushing out Plaintiff’s Arguments Defending or Minimizing the Fraud

A viable Motion to Dismiss for Fraud requires a plaintiff to fully explain the

Wallace v. Keldie, 2018 Fla. App. LEXIS 8301 ICMFG & Assocs v. Bare Bd. Grp., Inc., 42 Fla. L. Weekly D648, *19-20 (Fla. 2d DCA March 17, 2017) Id. Poff v. Guzman, 532 S.W.3d 867 Richmond Capital Group v. Orion Megivern, 2018 N.Y. Misc. LEXIS 6052, *8 In re Polete, 2018-Ohio-5275, P1 Chambers v. NASCO, supra, 501 U.S. at 44.

Parcher v. Gee, 2016 U.S. Dist. LEXIS 179454

CONCLUSION Fraudulent conduct occurs frequently in litigation, yet the Motion to Dismiss for Fraud is an underused tactic because it is viewed as nearly impossible to win. However, recent cases show not only that they are winnable, but are a valuable device for positioning a defendant for the best resolution of a case.

Elizabeth “Betsy” Burgess is a shareholder at Carr Allison in Tallahassee, Florida. She primarily defends retail, construction, employment, and professional liability cases.

She graduated from Auburn University and Florida State University College of Law, and is licensed to practice in all State and Federal Courts in Florida.

Christopher Barkas is a shareholder with Carr Allison in Tallahassee, Florida. He started his career as a prosecutor in Miami, Florida.

He now defends employment, professional liability, transportation, and retail cases.

He graduated from Florida State University and Cumberland School of Law, and practices in Florida State and Federal Courts.

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Six Cutting Edge Technologies to Improve Safety on Construction Sites Thomas S. Creel

According to OSHA, there were 971 worker fatalities in 2017 in the construction industry alone. One out of every five deaths that occurred in private industry occurred in the construction field. More than half of the construction industry deaths were the result of what OSHA calls the “Fatal Four,” which consists of falls, being struck by an object, electrocutions, and being caught in/ between equipment or objects. According to the Associated General Contractors of America, the construction industry grew by 23,000 jobs in September 2018, which is a 4.5% increase from the previous year, and brings the total construction workforce to its largest total in a decade. With a relatively large influx of new workers into an industry that can be inherently dangerous, safety on the job site is more important than ever.

Fortunately, new technology to combat the “Fatal Four” is being adopted into the construction industry at a rapid pace. New technology is being utilized to better train the workforce and to plan the project better to enhance safety, in addition to making the jobsite safer for workers once construction begins.

Carr Allison

WEARABLE TECHNOLOGY When most of us hear the term “wearables,” we think of counting our steps with one of the popular brands of fitness trackers. However, wearable technology is actually defined much more broadly, and constitutes any electronic device or sensor that collects and sends data to and from the wearer to a smartphone or a computer. In the construction industry, wearable technology is now being utilized to track a variety of information personal to the worker in order to monitor their activities and help keep them safe.

Current wearable technology used in the construction industry can use biometric sensors to monitor fatigue levels and track vitals in an effort to prevent injury. Many wearables contain GPS or radio-frequency identification (RFID) technology to allow managers to track each worker’s location at a given moment and alert them if they enter into unauthorized areas. Wearable technology can be used to send alerts to avoid collisions or unauthorized use of certain tools or equipment, and to monitor whether personal protective equipment is

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being utilized. Some wearable technology can also send an alert in the event of contact with a hazardous materials. Wearables can be used to send an alert in the event of an unwitnessed fall where the worker is unable to call for help, and can help rescuers locate trapped workers more easily.

Wearable technology can also improve evacuation speed in the event of an emergency.

Wearable technology can be implemented into bands/watches and into clothing such as vests, jackets or hats. A company called SolePower even manufactures boots that contain biometric sensors, GPS/RFID tracking technology, and a cellular 4G module that comes equipped with kinetic chargers that are powered by walking. (www. solepowertech.com/industrial/).

DRONES The use of drones, or Unmanned Aerial Vehicles (UAVs), in the construction industry has exploded over the past several years. One of the many benefits of their increasingly widespread incorporation into the industry is their ability to make the construction site safer in a variety of ways. On large construc-

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tion sites, drones are used to provide managers with a real-time, first-person view of the work being performed for use in accident prevention. Drones are also being used to perform visual, thermal and infrared sensors for inspections of hard-to-reach areas such as roofs, scaffolding, flashing, windows, and unstable or unsafe areas. Some drones are equipped with LIDAR technology to create 3D maps of job sites. Drones are also being used to inspect areas where there is a risk of exposure to hazardous substances. Some companies are using drones to transport tools, equipment and materials to dangerous places as well. In certain situations, drones are even being used to control unmanned construction vehicles.

EXOSKELETONS Robotic exoskeletons have not yet been widely adopted in the construction industry, but it is easy to see their potential impact in the future.

Exoskeletons are suits that consist of a light metal framework, that, when worn by workers, can make objects being lifted seem lighter or even weightless. Exoskeletons were first developed for the military, but have since found application in the healthcare and manufacturing industries.

Exoskeletons are being produced that contain motors or batteries to assist with lifting or hauling (known as “active”) or without (known as “passive”). Passive, unpowered systems are obviously less expensive and are becoming more popular than active systems in the manufacturing industry, according to industry professionals.

There are several different types of exoskeletons that would have application in the construction industry to reduce injuries. Some consist of a mounted arm attached to a counterweight worn on the lower body, which would be useful in operating tools. Other exoskeletons provide back support for bending down and lifting, while others can be worn on the lower body to support crouching or standing for long periods at a time. Finally, some full-body powered suits exist to assist with a variety of lifting and carrying tasks.

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BIM Building Information Modeling, or “BIM,” has been available for a while, but has continued to evolve in recent years and is becoming more widespread in use. The National Institute of Building Sciences defines BIM as “digital representation of physical and functional characteristics of a facility. . . a

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shared knowledge resource for information about a facility forming a reliable basis for decisions during its life-cycle; defined as existing from earliest conception to demolition.” (NBIMS-US, 2016). BIM includes 3D-modeling of a given project, but increasingly involves much more information than just a model that can be manipulated in software. BIM software tools can also include data pertaining to scheduling, cost and as-built operations. Much of the discussion surrounding BIM focuses on the financial benefits and improved efficiency that can result from advanced coordination between the design/construction teams and planning using BIM tools. However, those same improved efficiencies can result in a much safer jobsite as well.

Generally speaking, BIM tools can be used to reduce risk by identifying potential hazards early on in the planning phase and continuing throughout the life of the project. Some BIM tools incorporate automated safety rule checking, which can define when and where personal fall protection or perimeter protection should be utilized. The ability to simulate each construction process in advance makes it easier to develop the most efficient safety strategy possible. BIM results in streamlined communication between all parties involved in the construction process, which can result in fewer accidents. Another safety benefit to utilizing BIM tools is that it allows for offsite prefabrication of certain components of a structure, which allows for construction in more ergonomically favorable conditions than the job site itself.

VIRTUAL REALITY Virtual reality is another relatively new technology that has multiple practical applications in the construction industry. VR is being utilized in the development of training programs for workers that can place them in immersive, true-to-life scenarios that use sight, sound and even motion to provide training for a particular job in a safe environment. VR technology can even be used in conjunction with technology such as BIM to allow workers to be trained in a virtual mockup of their construction site. Heavy equipment operators can also use VR to be trained on a particular piece of equipment on a simulated jobsite like the one where they would be working.

The primary benefit of VR training is to provide realistic training in an environment that is completely safe. Individuals who are better “hands on” learners could be trained more quickly than with other types of train

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ing. Retention of the material should also be higher than other traditional forms of training because VR training is more realistic and immersive. Training using VR allows for the creation of more risky scenarios than other forms of training, which should also improve the quality of the training. VR training would also allow for endless repetition, as well as a safe environment to test and evaluate new processes. VR training provides the trainers with better means to evaluate the progress of the trainees.

SELF-DRIVING VEHICLES Driverless cars are projected to be publicly available for the first time later this year.

Self-driving technology and remote-controlled vehicles are being developed and incorporated into the construction industry because they can increase productivity and efficiency. Selfdriving vehicles also promote safety by reducing or eliminating human error and by allowing equipment to operate in areas that may be too hazardous for human drivers, allowing the operator to manage the project from a distance.

Autonomous trucks and other equipment have already been adopted to some extent in the mining industry, and industry leaders believe they will soon become mainstream across the entire construction industry. Heavy construction equipment is already available that can integrate 3D modeling of the job site with GPS, collision avoidance technology and other technology to autonomously create the grades that are specified in a 3D model, for example.

Such technology not only increases productivity and efficiency, but also promotes a safer jobsite.

In terms of the technology discussed above, the future is here. More widespread adoption in the construction industry will occur as the cost continues to decrease and more applications for each are developed.

As that occurs, the number of deaths or injuries resulting from the “Fatal Four” will be diminished, and productivity should be increased as well.

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Thomas S. Creel is a shareholder with Carr Allison and is based out the Birmingham, Alabama, office. His practice is focused on litigation, and in particular, the defense of both contractors and design professionals in construction defect cases. You can view his expanded bio at www.carrallison.com/attorneys/thomas-s-creel/.

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When the Driver is a Computer:

Addressing Auto Insurance Issues Surrounding Autonomous Vehicles Kent M. Bevan

Driverless cars and autonomous vehicles are a common sight in futuristic science fiction movies, but now they’re becoming a part of present-day reality. In fact, the physical act of driving a car may soon become a thing of the past.

The Insurance Institute for Highway Safety estimates that there will be 2.5 million self-driving vehicles on U.S. roads by 2025, and 4.5 million by 2030. This number jumps to 23 million by 2035 according to a study conducted by Accenture as reported by the Harvard Business Review.

Dysart Taylor Cotter McMonigle & Montemore, PC

That’s close to 10 percent of the nearly 250 million total cars and trucks registered in the U.S. Many of today’s high-end cars and even some mid-grade ones already have driverless vehicle technology options.

The increasing presence of all these autonomous vehicles on U.S. roads gives rise to new and unique issues for the insurance industry. Why the demand for driverless cars in the first place? The major reasons are safety, efficiency, and convenience.

The U.S. Dept. of Transportation National Highway Traffic Safety

Administration attributes 94 percent of auto accidents to human error. Motor vehicle crashes in the U.S. caused more than 37,000 deaths in 2016, or 1.18 deaths per 100 million vehicle miles traveled. It stands to reason that when you remove human error as a factor, the roads naturally become much safer.

Most autonomous vehicles of the near future will be owned by auto manufacturers and technology companies, not individuals. Fleet owners can utilize these assets on a 24-hour basis, amortizing the cost of ownership. Thus, individual consumers may

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no longer need to own a car themselves to get where they’re going. Transportation and logistics companies will also integrate autonomous vehicles at a rapid pace for the same reasons.

Current vehicle regulations bar self-driving cars without equipment such as steering wheels, pedals, and mirrors.

However, the current U.S. administration is in the process of revising these rules. In addition, vehicle manufacturers are seeking exemptions from such rules as they now exist. According to the Insurance Journal, General Motors Co. recently filed a petition seeking an exemption from the requirement for vehicles to have steering wheels and other human controls for a ride-sharing fleet it wishes to deploy as soon as 2019.

RISKS AND RISKY BEHAVIORS PERSIST EVEN WITH DRIVERLESS CARS When you have a moment, Google “sleeping Tesla drivers” and check out some of the search results that pop up. They’ll include several news stories and even YouTube videos of drivers asleep at the wheel as their autopilot-driven vehicles propel them down the road. It’s a shocking sight, and it’s hard to believe that this could be a safer situation than a fully awake driver who’s completely in command of their vehicle. The fact is that when you remove human control you don’t always remove human error, and you don’t necessarily guarantee safety.

In 2017, the National Transportation and Safety Board faulted Tesla autopilot technology in a May 2016 car crash that killed the autonomous car’s driver. The NTSB said the “probable cause” of the accident was “the truck driver’s failure to yield the right of way and a car driver’s inattention due to over-reliance (on autopilot technology).” Tesla stated in a blog post about the incident that the driver ignored repeated warnings to keep his hands on the steering wheel.

In 2018, a Tesla vehicle fatally struck a pedestrian as she was crossing the street. Video from inside the car at the time of the incident showed the driver was distracted and not paying attention to the road when it occurred.

Based on these and many other incidents involving autonomous vehicles, we can conclude that insurance will continue to play a major role in the automotive and transportation industries. The question is, “How?” IMPLICATIONS FOR INSURERS Nearly half of insurers consider autonomous vehicles to be an important emerging issue according to a 2016 survey by the International Organization for Standardization. However, most respondents had only engaged in informal dis-

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cussions on the topic, if they had discussed it at all. This needs to change because the number of individual auto policy owners is poised to fall dramatically in the coming years as the number and severity of accidents and insurance claims drop due to autonomous vehicle technology.

One of the most prominent industry leaders to recognize this fact is billionaire investor Warren Buffett whose company, Berkshire Hathaway, owns insurance titan Geico. He said, “If the day comes when a significant portion of the cars on the road are autonomous, it will hurt Geico’s business very significantly.”

Of primary concern is where blame will be apportioned when auto crashes occur involving autonomous vehicles. Typically, blame is shared among drivers vis-à-vis comparative fault. But when some of the blame fell on the autopilot systems involved in the 2017 and 2018 fatal Tesla crashes, it created an uncomfortable level of ambiguity as to how to proceed for insurance purposes.

Product liability may become a greater factor in litigation arising from autonomous vehicle crashes. But such litigation is arduous and time-consuming and can also produce cascading claims.

Some technology companies and auto manufacturers have stated that they’ll assume liability for their autonomous vehicles’ level of responsibility in crashes.

Google, Volvo, and Mercedes-Benz already accept such liability, and Tesla is extending an insurance program to those who’ve purchased their vehicles. However, it may not always be up to the private businesses as to whether they accept responsibility.

Michigan recently passed a law which specifies that automakers must assume liability when the driverless cars they manufacture are at fault and must also insure every autonomous vehicle in their fleet.

One possibility could be for insurers to offer hybrid product liability and auto insurance. This could reduce the length and cost of litigation while covering both the driver and the manufacturer at the same time. But, the overall compatibility of such hybrid coverages with current laws remains unknown. State legislatures have so far done little to address the implications of autonomous vehicles in existing auto insurance laws. Another option is for insurers to revise or expand no-fault insurance options and comprehensive insurance to address issues pertaining to autonomous vehicles.

WHAT INSURERS CAN DO NOW There are three main areas with significant profit potential for insurers as autonomous vehicles become more commonplace.

These areas will help insurers offset revenue losses from decreasing individual policies and premiums. They are: • Cybersecurity – The increase in reliance of motor vehicles in internet-connected technology also increases potential vulnerability to cyberattacks.

• Product liability – When crashes occur as a result of faulty technology products and not human error or in addition to human error.

• Infrastructure – Cloud servers and other technology infrastructure that enable vehicle autonomy must be safeguarded against any potential liabilities.

To address these areas, insurers should develop expertise in internet-of-things technology, big data, and analytics. This will enable them to understand data generated by autonomous vehicles which will give them an advantage over competitors who lack these capabilities. They should also develop actuarial and modeling techniques that specifically address features of autonomous vehicle technology. This will help them adjust their business models as the technology becomes more commonplace. Finally, they should network to develop new and deeper relationships with automakers as well as communication technology companies and local and state governments. One other thing to note is that decreasing premiums may ultimately make mergers and acquisitions more likely as larger carriers purchase smaller ones to maintain revenue.

Driverless cars and autonomous vehicles are already becoming a reality, and the insurance industry needs to keep up with technology. Understanding the issues surrounding such technology and making strategic adjustments to your business model now will give you an advantage over your competition in the not-too-distant future.

Kent M. Bevan is of counsel at Dysart Taylor Cotter McMonigle & Montemore, PC in Kansas City, Missouri.

His practice focuses on insurance law and litigation.

Kent regularly writes alerts with analyses of recent court decisions involving insurance litigation which you can view at https://www.dysarttaylor.com/ news-events/alerts. You can view his expanded bio at https://www.dysarttaylor.com/our-people/ kent-m-bevan or contact him at kbevan@dysarttaylor.com.

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Developing Data Privacy Law and the Standard for

“Reasonable Security Measures” Hilary Wells and Holly White

Legislation regarding data privacy has exploded over the past few years. Gone are the days of data protection requirements only applying to the finance and health care sectors. Individuals and companies across all sectors face new and expanded requirements to protect and properly maintain personal identifying information. The FTC, exercising its enforcement powers under Section 5, is targeting businesses it believes are employing unreasonable security practices. To complicate matters even further, because Congress has failed to enact a uniform data protection statute, the individual states are taking up the charge to protect personal information, each in a slightly different manner. This article will analyze the newly enacted data protection laws in the United States and offer guidance

Lewis Roca Rothgerber Christie LLP

regarding the developing standard of care, known as “reasonable security measures.”

Nearly 10 states have recently enacted expanded data privacy legislation, which has already become effective or will become effective early next year. These states include Alabama (SB 381, effective June 1, 2018), Arizona (HB 2145, effective August 3, 2018), California (A.B. 375, effective January 1, 2020), Colorado (HB 1128, effective September 1, 2018), Louisiana (Act No. 382, effective August 1, 2018), Nebraska (LB 757, effective July 18, 2018), Ohio (SB 220, effective November 2, 2018), Oregon (SB 1551, effective June 2, 2018), and South Dakota (SB No. 62, effective July 1, 2018).

Most of these laws broaden the definition of “personal information” and increase notification obligations. Some states now

mandate deletion of personal information when it is no longer needed, and impose hefty civil penalties for non-compliance.

Many of these newly enacted statutes, including those enacted in Alabama, California, Colorado, Louisiana, Nebraska and Oregon require the individual, business or entity maintaining personal information to use “reasonable security measures.” Other states that use “reasonable security measures” for their data protection standard include Arkansas, Illinois, Maryland, Nevada and New Mexico. Ohio has taken a unique approach by focusing on compliance through voluntary action and offers a breach litigation safe harbor to covered entities that meet the law’s cybersecurity standards. Conversely, California and Colorado have some of the broadest and

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strictest statutes in the country. Colorado requires covered entities to affirmatively delete and protect personal information as well as investigate breaches and potential breaches and adhere to strict notification standards. California’s new law provides that consumers have the right to request the deletion of personal information, opt out of the sale of personal information and access the personal information in a “readily usable format” that enables it to be easily transferred to third parties. Businesses are concerned that this law could threaten companies that generate revenue from targeted advertising over internet platforms, such as social media companies, Google and even internet service providers.

The term “reasonable security measures” is becoming part of the data protection lexicon. Thus, it is important to understand what this term means and how to comply. Reasonable security is not a new concept. The Uniform Commercial Code has used the term “security procedure” in connection with wire transfers since 1989.

“Security procedure” is defined in Section 4A of the Uniform Commercial Code as:

A procedure established by agreement of customer and a receiving bank for the purpose of (i) verifying that a payment order or communication amending or cancelling a payment order is that of the customer, or (ii) detecting error in the transmission or the content of the payment order or communication. A security procedure may require the use of algorithms or other codes, identifying words or numbers, encryption, callback procedures, or similar security devices.

Comparison of a signature on a payment order or communication with an authorized specimen signature of the customer is not by itself a security procedure.

Further, Uniform Commercial Code Section 4A provides:

If a bank and its customer have agreed that the authenticity of payment orders issued to the bank in the name of the customer as sender will be verified pursuant to a security procedure, a payment order received by the receiving bank is effective as the order of the customer, whether or not authorized, if (i) the security procedure is a commercially reasonable method of providing security against authorized payment orders, and (ii) the bank proves that

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it accepted the payment order in good faith and in compliance with the security procedure and any written agreement or instruction of the customer restricting acceptance of payment orders issued in the name of the customer.

Commercial reasonableness of a security procedure is a question of law to be determined by considering the wishes of the customers expressed to the bank, including the size, type, and frequency of payment orders normally issued by the customer to the bank, alternative security procedures offered to the customer, and security procedures in general use by customers and receiving banks similarly situated.

This early Uniform Commercial Code definition of a commercially reasonable security procedure would become a springboard for the interpretation of “reasonable security measures” contained in the recently enacted data privacy legislation. The standard relies heavily upon the industry practice in which the individual, business or entity operates. Thus, it is important to be aware of what your particular industry requires with respect to cybersecurity. For example, the Federal Financial Institutions Examination Council (“FFIEC”) has released regulatory guidance regarding online banking, outlining what kind of security controls need to be in place, such as multifactor authentication and back-end fraud detection controls. The FFIEC is a formal United States government interagency body composed of five banking regulators that is “empowered to prescribe uniform principles, standards and report forms to promote uniformity in the supervision of financial institutions.” Courts rely heavily on this type of guidance to determine whether “reasonable security measures” have been implemented by an organization.

The National Institute of Standards of Technology has developed a Cybersecurity Framework for how private sector organizations in the United States can access and improve their ability to prevent, detect and respond to cyberattacks. The first version of the framework was published in 2014 and was originally aimed at operators of critical infrastructure. Version 1.1 of the framework was released to the public on April 16, 2018, and includes guidance on how to perform self-assessments, additional detail regarding supply chain risk management, and how to interact with supply chain stakeholders. The NIST framework is generally viewed as an industry best practice, but it has faced criticism because complete implementation requires

a high level of investment.

The NIST Cybersecurity Framework is divided into three parts: “Core,” “Profile,” and “Tiers.” The NIST Framework’s Core structure consists of five functions (1) Identify, (2) Protect, (3) Detect, (4) Respond and (5) Recover. Each of these functions is then broken down into categories, subcategories and informative references. The “Profile” element of the framework is where an organization typically begins. The organization develops a “Current Profile” to outline its cybersecurity activities and the outcomes it is achieving. It can then develop a “Target Profile,” or simply utilize a baseline profile tailored to its particular sector or type of organization. The “Tiers” are used by an organization to clarify how it views its cybersecurity risk and the degree of sophistication of its management approach.

The FFEIC guidance and the NIST Cybersecurity Framework are good resources for determining if your organization is meeting the standard of care with respect to “reasonable security measures.”

However, assessing cybersecurity risk must be a dynamic process, as the risks are always changing and evolving. What constitutes a “reasonable security measure” this year may not be considered as such next year. Thus, an organization should have a core structure in place that is flexible and appreciates that “reasonable security measures” are not a static concept but one that must continue to evolve and develop to meet the challenges of the changing cybersecurity landscape.

Hilary Wells is a partner in Lewis Roca Rothgerber Christie’s Litigation Group and serves as the chair for the Data Protection and Cybersecurity team. She has represented a wide-range of businesses including banks, financial advisors, private equity companies, insurance companies and health care providers.

Holly White is a partner in Lewis Roca Rothgerber Christie’s Litigation Group.

Her practice is primarily focused on contractual disputes between large commercial entities and insurance companies. She approaches litigation thoughtfully and strategically, with the intent of obtaining the best and most efficient outcome for her clients based on her analysis of the specific facts of each individual case.

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GOODBYE, GRANDFATHER How Property Renovations Can Create Compliance Issues with Current Building Codes Rebecca K. Hinds and M. McKenzie Reed Martin, Tate, Morrow and Marston, P.C.

Meeting building-code requirements is challenging enough for new builds, but did you know that an update to your existing structure can trigger compliance with a whole new set of standards?

In endeavoring to improve a building, contractors and business owners alike must be careful not to disturb the “grandfathered in� status of the balance of the structure.

Maintaining code compliance is important for a number of reasons, but this article focuses on the significance of code conformity in avoiding liability in negligence per se.

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The International Building Code (IBC) is a model building code generated by the International Code Council (ICC) that most jurisdictions in the United States have adopted as a base code standard. The purpose of the IBC is to protect health, safety, and general welfare as they relate to the construction of buildings. To that end, the IBC provides minimum performance criteria that must be met to safeguard the well-being of occupants of new and existing buildings and structures.

In order to keep up with new methods and technologies, the ICC publishes a new edition of the IBC every three years.

Recognizing, however, that it would be unreasonable to require buildings to comply with new standards in the Code every three years, and that in many cases, bringing an entire building up to compliance would be cost-prohibitive or even structurally impossible, the IBC contains “grandfathering” provisions that exempt structures “erected under the provisions of an earlier building code” from having to comply with new construction requirements.

But what happens when an existing structure gets an upgrade? Until 2015, Chapter 34 of the IBC answered this question. Under Chapter 34, upgrades in the form of alterations or additions to an existing building were required to comply with new code requirements, but portions of the structure not altered or affected were not required to meet current standards. An “alteration” was defined as “any construction or renovation to an existing structure other than a repair or addition,” and an “addition” was defined as “an extension or increase in floor area or height of a building or structure.” Upgrades in the form of repairs, however, were more complicated. A “repair” was defined as “the reconstruction or renewal of any part of an existing building for the purpose of its maintenance.” The extent to which a repair of one aspect of the structure triggered the requirement to bring other parts of the building into compliance with current standards depended on the extent of the damage that necessitated the repair. Anything less than “substantial structural damage” required only the repair itself to meet current building standards and did not affect the “grandfathered” status of the undamaged portions of the building.

In 2015, however, the ICC eliminated Chapter 34 of the IBC. A separate code, the International Existing Building Code (IEBC), now governs alterations, additions, and repairs to existing structures in jurisdictions that have adopted the 2015 code and the omission of Chapter 34 therefrom. Like Chapter 34 of the IBC, the IEBC aims to pro-

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tect public health, safety, and welfare without unnecessarily increasing construction costs.

The gist remains that additions, alterations, and repairs should comply with new codes, but generally speaking, existing buildings need only be maintained to their current level of safety. The IEBC requires any update to a building comply with the then-existing building requirements, but it offers flexibility to owners, builders, and design professionals by providing three methods of compliance: (1) prescriptive, (2) work area, and (3) performance. Each of these methods addresses alterations, additions, and repairs. The prescriptive compliance method mirrors Chapter 34 of the IBC. The work-area compliance method is the most flexible of the three options and focuses on the scale and level of work being performed. The performance method, which is the least employed, scores the existing safety conditions of a building and requires improvements be undertaken where appropriate to increase the building’s safety score to a suitable level.

What does this have to do with the price of tea in China? Premises liability, of course. In a majority of American jurisdictions, the violation of a building code can qualify as negligence per se. This means the conduct is automatically considered negligent without any further proof, and the plaintiff need only establish causation to recover damages. Because the inference of negligence makes it much easier for a plaintiff to prevail than by conventional means, it is important to limit exposure to claims sounding in negligence per se. In the context of building-code compliance, the most fertile ground for a costly error is in improvements to existing structures.

Consider, for example, you own an apartment complex. The complex was built in 2000 under the then-existing building code, which required the installation of handrails on all stairs inside and leading into a structure but did not require handrails on exterior stairs. At the time, a trusted design professional assured you no handrails were required on an exterior set of stairs that you had commissioned to connect your apartment units to a parking lot on the complex.

Years later, however, at a tenant’s request, you decided to install a single handrail along one edge of the parking-lot stairs.

You made sure the handrail complied with the 2012 building code, which applied at the time of the update.

Fast-forward to 2019. A tenant falls down the stairs to the parking lot and sues you alleging liability under negligence per se because, she claims, the 2012 building code required a handrail on both sides of any exterior stairs and the lack of the sec-

ond handrail caused her to lose her balance and tumble. However, you read this article and talk to your attorney and know that the installation of a single handrail in 2012 was an “alteration” to an existing step structure.

While the alteration itself was required to comply with code standards for new construction, you were not required to bring the remaining portions of the steps into compliance with the 2012 code because those areas were not altered or affected by the installation of the single handrail.

Therefore, the tenant cannot rely on your failure to meet the two-handrail requirement of the 2012 code to form the basis of a claim of negligence per se.

Would the installation of a single handrail after 2015 in a jurisdiction controlled by the IEBC lead to the same result? The answer depends on whether the chosen compliance method at the time of the improvement was prescriptive, work area, or performance. For example, under the performance method, if the parking-lot stairs scored low in safety because of the absence of handrails, yet you installed only one handrail, you may be in violation of the IEBC and subject to liability in negligence per se if two handrails were required to render the stairs sufficiently safe.

Familiarize yourself with the laws of your jurisdiction and whether existing structures are governed by the IEBC or Chapter 34 of the IBC. Also know whether the upgrade you are making is an alteration, addition, or repair. Down the line, these distinctions could mean the difference between a multi-million-dollar verdict and a judgment for the defense.

Rebecca Hinds is an associate at Martin, Tate, Morrow and Marston, P.C. in Memphis, Tennessee. She represents clients in a wide variety of civil and commercial litigation matters, including in business law, transportation liability, construction disputes, breach-of-contract matters, and employment law.

McKenzie Reed is an associate at Martin, Tate, Morrow & Marston, P.C. in Memphis, Tennessee, where she is involved in various types of litigation, including transportation matters, contract disputes, construction issues, and business law.

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BRAZIL’s GENERAL DATA PROTECTION LAW An important move towards legal certainty for data-driven businesses

Tomás Filipe Schoeller Ribeiro Paiva and Kauê Almeida Curti Mundie e Advogados

Despite being a relevant player in the global digital economy and the exponential growth of data-driven markets in the country in the last few years, Brazil did not have a general legal framework for data protection until August 2018, when the National Congress passed Federal Law No. 13,709/2018 (the so-called Brazil General Data Protection Law – “GDPL”), which provides for general principles and rules regarding the processing of personal data of individuals located within the Brazilian territory. The new Law – whose draft was subject to public consultations and hearings with the relevant participation of several stakeholders (public bodies, academy, companies, general public, etc.) – is the result of six (6) years of debate within the National Congress.

Besides closing a legislative gap on the subject, the GDPL provides legal certainty

in relation to data protection in Brazil, as the issue was subject to multiple, and several times, conflicting sector-specific laws and regulations (including consumer protection norms, credit Reporting laws, the Internet Law, regulations on specific sectors such as telecommunications, health insurance, etc.).

Largely inspired by the EU General Data Protection Regulation, the GDPL adopts a broad definition of personal data as “information regarding an identified or identifiable natural person.” Based on this definition, the provisions of the new law are intended to cover any operation performed on personal data by a natural person or a legal entity, regardless of the means and of whether the processing takes places, as long as (i) it is performed within the Brazilian territory, (ii) the processing activities are related to the offering of goods or services

in Brazil or the processing of data subjects who are in Brazil, or (iii) personal data to be processed abroad is gathered within the Brazilian territory.

It is worth mentioning that the law does not apply in relation to anonymized data, i.e. data that had undergone an irreversible anonymization procedure that is impossible to link to an identified or identifiable natural personal.

Under the GDPL, data processing shall always be limited to the extent of the specific purposes disclosed to data subjects and to what is necessary for such purposes (and once the purposes are reached, data processing is expected to cease).

The processing of personal data will only be lawful according to Brazilian legislation if a valid circumstance applies, being the following considered as “lawful circumstances:”

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(i) the data subject has given consent to the processing of his personal data; (ii) processing is necessary: a. for compliance with a legal obligation to which the controller is subject; b. for the performance of a contract to which the data subject is party or to take steps at the request of the data subject prior to entering into an agreement; c. for the legal exercise of rights in a judicial, arbitral or administrative proceeding; d. to protect the vital interests or the physical safety of the data subject and/or a third party; e. for health protection, in relation to proceedings performed by health professionals and entities; f. for the purposes of the legitimate interest pursued by the controller or by a third party, except where such interests are overridden by the interests or the fundamental rights of the data subject; or g. for credit purposes, as set forth in the Brazil’s Consumers’ Defense Code.

In case the processing is based on consent, it is up to the controller (i.e., the natural person or the legal entity responsible for making the decisions regarding a certain data treatment) to demonstrate that the consent was given in an unequivocal manner.

More than consenting with the collection/ processing of its data, the data subject shall consent with the purposes of the processing.

Where processing is based on consent, the data subject’s consent will also be requested for data exchange with other controllers, except where the law provides differently.

Under the law, data subjects can withdraw their consent at any time.

One different legal basis for the processing of personal data under the GDPL is the so-called “legitimate interests,” which is a balancing test that is made by the controller at their own risk. According to the law, the “legitimate interests” circumstance is applicable in cases where the controller has a “legitimate interest” that prevails over the data subject’s privacy rights. Due diligence, internal investigation and fraud prevention are examples of processing based on a “legitimate interest” circumstance, without the data subjects’ prior-consent.

Pursuant to the law, data subjects are entitled to several rights, including (i) information and access to personal data stored by a controller/processor, (ii) rectification and erasure, (iii) anonymization,

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(iv) restriction of the processing, (v) consent withdrawal, (vi) data portability and (vii) the right to object a decision based solely on automated processing and to request its review by a natural person.

Data controllers and processors (i.e., the natural person or the legal entity that processes personal data on behalf of the controller), in turn, shall comply with several relevant obligations, including: (i) to adopt security and administrative measures to avoid unauthorized access, destruction, loss, modification, transfer or any other illicit processing operation of data subjects’ personal data, according to the standards to be set forth by an enforcement authority; (ii) to delete gathered data once the purposes for the processing are reached, except where the law provides differently; (iii) to name a Data Protection Officer (the enforcement authority shall enact a regulation establishing the criteria for such a designation); (iv) in case of data breach, to give notice of the breach to data subjects and to the enforcement authority; and (v) to adopt the principles of “privacy by design and by default.”

In relation to cross-border data exchange, the GDPL adopts a similar approach to the EU GDPR, being that the international flow of data is allowed only in relation to countries whose legal regime is deemed as capable to provide an “adequate” level of protection. In the absence of an adequacy decision, transfers can take place under certain conditions set forth by law, including the use of standard contractual clauses or binding corporate rules (BCRs) or with the specific and highlighted consent from the data subject, authorizing the data flow to a third country.

Under the original language of the GDPL, an independent authority would be empowered to enforce the new piece of legislation. However, the provisions regarding such an authority were vetoed by Brazil’s president due to formal aspects.

At the eleventh-hour of 2018, four days before the new government took office, President Michel Temer enacted a Provisional Measure which modifies several provisions of the GDPL and provides for an enforcement authority, empowered with, among other attributes, supervising and imposing penalties to those subject to the new law.

Although under Brazilian Law, Provisional Measures as the one enacted by President Temer, as a rule, enter into force immediately, the provisions are subject to further review and deliberation by the National Congress and may be modified by the legislature.

Pursuant to the GDPL, violations to the provisions set forth by the law may entail

warnings, one-off or daily fines, publication of the condemnatory decision in newspapers, suspension, and partial or total prohibition of processing personal data within the Brazilian territory. Fines may reach up to 2% of the gross revenue of the company or its economic group in Brazil, limited to BRL 50 million (approx. USD 14.7 million).

Besides the above-mentioned penalties, the responsible party (data controllers and processors) that causes damage, either individual or collective, to a person is liable by law to pay the relevant compensations, to be ascertained by the Courts. Under the law, data processors are jointly liable with data controllers in case they violate the provisions set forth by law or had not complied with the instructions set out by the data controller.

According to Section 65 of the GDPL, except in relation to the provisions regarding the enforcement authority, the new law will enter into force in 2020. Considering how recent the law is, the fact that the enforcement authority is still to be established and the implementing regulation and guidelines are pending, much is still uncertain. Several issues that remain unresolved will doubtless be the subject of further discussion in the coming months.

It is indisputable, however, that the GDPL is an important landmark for Brazil and an important step towards legal certainty for data-driven businesses.

Tomás Filipe Schoeller Ribeiro Paiva is an associate attorney at Mundie e Advogados.

He earned a PhD in Constitutional Law at both the University of São Paulo, Brazil, and University Paris I, Pantheón-Sorbone in France. Tomás is a member of the Brazilian Bar and his main areas of work are internet & technology; media, communication, content and entertainment; and telecommunications.

Kauê Almeida Curti is an associate at Mundie e Advogados. He graduated with a Bachelor of Laws from Mackenzie Presbyterian University followed by post-graduate degree in Public Law at Damásio Educacional. He is a member of the Brazilian Bar and his main areas of work are internet & technology; media, communication, content and entertainment; and telecommunications.

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Expand and Contract:

Developments in Workers’ Compensation Exclusive Remedy Michael J. Nunez and Kelsey L. Maxwell

Broadly speaking, the workers’ compensation exclusive remedy provision holds that employers are immune from liability for injuries sustained by employees during the course of employment. This exclusive remedy provision is codified in a number of states1 in order “to give efficacy to the theoretical “compensation bargain” between the employer and employee.” Privette v. Superior Court, 5 Cal. 4th 689, 697. While this rule is routinely applied when the injured party is an employee of the employer, a question often arises as to whether the exclusion applies to an employer (or landowners) when the injured party is an employee of an independent contractor or subcontractor. States vary in how widely or narrowly this doctrine is applied when it comes to employees of independent contractors, subcontractors, or

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other hirees and in the last few years, various states have taken steps to either expand or contract the application of this doctrine.

NEVADA Most recently, Nevada has expanded this doctrine as it applies to employees of independent contractors and subcontractors.

Dating back decades, Nevada has afforded independent contractors and subcontractors the same status as employers when it comes to “exclusive remedy” so long as the contractor is in the same trade, business, profession or occupation as the employer of the injured worker.2 Nevada refers to this analysis as the “normal work test.” The defining question of the “normal work test” is whether the work being performed is normally, in that business, carried on

through employees rather than independent contractors.

In the recent unpublished decision of Sedano v. Houston, the court concluded that Sedano was bound by the exclusive remedy rule where the court determined that Houston was not performing a specialized repair. 2018 Nev. App. Unpub. LEXIS 280, *3-5. Sedano worked at a residential construction site when Houston’s employee, who was operating a crane to install roof trusses, lowered a truss onto Sedano. There, Sedano’s employer was not qualified to use cranes so it hired Houston to perform crane work on the project. The court determined Houston was hired to provide a service directly in furtherance of the overall project (i.e., building a residential structure).” Thus, the exclusive remedy defense

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applied. Sedano v. Houston is compared to D&D Tire, Inc. v. Ouellette.

In D & D Tire, Inc. v. Ouellette, an employee of Allied, hired to perform tire service work on mining equipment, was injured when an employee of a third-party, Purcell, who was repairing the Allied employee’s truck, backed the truck into the Allied employee. 131 Nev. Adv. Rep. 47, 352 P.3d 32, 34. The Supreme Court concluded that the Purcell employee was sent to the work site for the purpose of specialized repairs on the truck and therefore was not a statutory employee of Allied. Id. at, 352 P.3d at 37.

WASHINGTON Similarly in Washington, the Court of Appeals recently decided a case (Am. Hotel & Lodging Ass’n v. City of Seattle, 2018 Wash.

App. LEXIS 2890), challenging the validity of a ballot initiative in the state. Initiative 124 (I-124) established health, safety, and labor standards for hotel employees within Seattle. In part, the initiative conferred subject matter jurisdiction on a state court to resolve work-related injury claims. The Court of Appeals instructed the trial court to enter summary judgment in favor of the challenging parties in part, because the initiative conflicted with key provisions of Washington’s workers’ compensation system by creating a private cause of action that does not exist under Washington law.

The Court explained that Washington’s Industrial Insurance Act represents a “grand compromise” between industry and labor to remove workplace injuries from the court system and to provide injured workers with a swift, no-fault compensation system for on-the-job injuries. Accordingly, the Court held that even if a city could lawfully enact worker safety provisions that are stricter than those imposed by the Washington State Department of Labor and Industries, the city cannot confer subject matter jurisdiction on a state court to resolve work-related injury claims when, by statute, the Washington legislature has abolished that very jurisdiction more than a century ago. This was a clear affirmation of the State’s exclusive remedy rule.

CALIFORNIA California on the other hand has gone in a different direction, narrowing the scope of the application of this doctrine to employees of independent contractors and subcontractors. The leading case in California 1 2

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regarding property owners’ liability to employees of independent contractors working on its land is Privette v. Superior Court, 5 Cal. 4th 689. In Privette, the California Supreme Court limited the breadth of the peculiar risk doctrine, concluding that it does not extend to hired contractor’s employees. The Court reasoned that because the Workers’ Compensation Act shields an independent contractor from tort liability to its employees, applying the peculiar risk doctrine to the independent contractor’s employees would illogically and unfairly subject the hiring person to greater liability than that faced by the independent contractor whose negligence caused the employee’s injury. This principle however is subject to many exceptions and the scope of those exceptions is expanding.

For example, in 2018, California’s Second District Court of Appeals heard the case of Gonzalez v. Mathis, 20 Cal. App. 5th 257 which focused on the “hazardous conditions” exception. In reviewing a lower Court’s ruling on a Motion for Summary Judgment, the Court analyzed scope of this exception as it pertained to a concealed hazard. Generally, when there is a known safety hazard on a hirer’s premises that can be addressed through reasonable safety precautions on the part of the independent contractor, the hirer delegates the responsibility to take such precautions to the contractor and is not liable to the contractor’s employee if the contractor fails to do so. See Kinsman v. Unocal Corp., 37 Cal.4th 659, 673-674 (2005). However, if the hazard is concealed from the contractor, but known to the landowner, liability may attach.

The recent Gonzalez case took this exception further and held that while generally a hirer cannot be held liable for injuries resulting from open or known hazards the contractor could have remedied through the adoption of reasonable safety precautions, similarly the hirer can be held liable when he or she exposes a contractor (or its employees) to a known hazard that cannot be remedied through reasonable safety precautions. Thus, the hazardous conditions exception seems to apply not only to concealed conditions, but obvious conditions if the contractor cannot remedy the condition. This holding widens the number of exceptions to Privette’s rule of “no liability” for landowners.

OREGON Recent case law in Oregon has similarly limited the scope of this exclusion. In the

See Cal Lab Code § 3601; Nev. Rev. Stat. Ann. § 616B.612; ORS § 656.018; Wash. Rev. Code § 51.04.010.

Statutory employers are immune from suit under the Nevada Industrial Insurance Act. Richards v. Republic Silver State Disposal, Inc., 122 Nev. 1213, 1218, 148 P.3d 684, 687 (2006). “A company that ‘has in service any person under a contract of hire,’ is that person’s statutory employer under the NIIA.” Id. The scope of “statutory employer” is broadened to include principal contractors, …, but also of the employees of their subcontractors and independent contractors. Id.; see also NRS 616A.210(1).

case of Bundy v. NuStar GP, LLC, 362 Ore. 282, Oregon’s Supreme Court analyzed ORS 656.019 to determine whether the “claim” includes subsequent claims. ORS 656.019 states, “an injured worker may pursue a civil negligence action for a work-related injury that has been determined to be not compensable because the worker has failed to establish that a work-related incident was the major contributing cause of the worker’s injury only after an order determining that the claim is not compensable has become final.” The question this Court considered was whether “the claim” refers to the initial claim for workers compensation only, or whether it includes subsequent claims. In Bundy the Plaintiff initially received workers compensation for injuries sustained while working, but later claims were denied workers compensation and thus Plaintiff sought recovery for these subsequent claims via civil litigation. The defense argued that as Plaintiff received workers’ compensation for his injuries initially, such compensation was his exclusive remedy. The Supreme Court disagreed and agreed with Plaintiff that a single workplace incident can give rise to multiple individual “claims.” Accordingly, the workers’ compensation exclusion has been limited in Oregon in that the same workplace injury can give rise to both workers’ compensation claims, and civil lawsuits.

In sum, while hirers are often categorically immune from liability for injuries to its employees or employees of its independent contractors when workers’ compensation insurance is available, various jurisdictions are expanding on, or limiting, this application.

Michael J. Nuñez is a senior partner at Murchison & Cumming, LLP and a member of the firm’s Diversity Committee. He handles general and professional liability, hospitality, HOA, D&O, breaches of fiduciary duties, corporate litigation, contract disputes, and transactional, and employment related matters.

Kelsey L. Maxwell, an associate at Murchison & Cumming, LLP, focuses her practice on the areas of general liability, and specialty tort including habitability and discrimination claims. She is a graduate of The University of Arizona (B.A.) and Chapman University, Dale E. Fowler School of Law (J.D.).

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First Line of Defense:

How Businesses Use the First Amendment to Overrule Government Laws and Regulations William S. Fish, Jr.

Free speech and the First Amendment are quintessential, well-known American values. What is far less known is that the First Amendment has become a potent weapon for businesses to successfully challenge government regulations. Specifically, through a series of decisions, the U.S. Supreme Court increasingly has relied upon the First Amendment to hold that laws regulating businesses are unconstitutional because they impermissibly infringe on a business’s commercial free speech rights. Justice Breyer commented on the potential breadth of this weapon in dissent in the Supreme Court’s most recent (2018) decision on this topic:

Because much, perhaps most, human behavior takes place through speech and because much, perhaps most, law regulates that speech in terms of its content, the majority’s approach at the least threatens considerable litigation over the constitutional validity of much, perhaps most, government regulation.

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It is important to understand how this “new weapon” is used by businesses to overrule all types of government regulations through litigation. This article explores this in-depth, starting with a history of commercial speech and our nation’s highest court.

COMMERCIAL SPEECH AND SCOTUS: A COMPLEX HISTORY

Commercial free speech has a complex and confusing history at the Supreme Court. The first time that the Court granted constitutional protection to commercial free speech was in 1976. There, in a case involving the Virginia Board of Pharmacy, the Supreme Court overturned a law making it illegal for pharmacists to advertise prices, holding that so long as the advertisement was truthful, it was protected by the First Amendment to satisfy the public interest in the free flow of information.1

In 1980, the Supreme Court overturned a New York law that banned utility advertising in an attempt to decrease energy usage

during the energy crisis. The Supreme Court adopted a four-part test – now known as the Central Hudson test – for determining whether government regulation of commercial speech was proper: (1) the speech could not be false or misleading; (2) the government interest in regulating the speech had to be substantial; (3) the regulation had to directly advance the government’s interest; and (4) the regulation had to be no more extensive than necessary. This test has been characterized as requiring an “intermediate level” of scrutiny.2

In 1985, the Supreme Court upheld an Ohio law that required lawyers to put certain disclaimers in every contingency fee advertisement. The Court held that the government may compel commercial speakers to make certain disclosures if the disclosures were (1) factual and uncontroversial, (2) reasonably related to a non-speculative government interest, and (3) not unduly burdensome.3 Because the required disclaimer met these requirements, which be-

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came known as the Zauderer test, the Court upheld the Ohio law. Notably, courts have struggled to apply the Zauderer test, which was more lenient than the Central Hudson test, reaching different conclusions on how and when the Zauderer test should apply.

These principles have been significantly broadened by the Roberts Court.

Beginning in 2010 with the landmark decision of Citizens United,4 the Supreme Court expanded the concept of corporate free speech and used that expanded concept to strike down various laws. First, in Citizens United, the Supreme Court struck down parts of the Bipartisan Campaign Reform Act of 2002, holding that its limitation on political expenditures was a violation of corporate free speech rights under the First Amendment. Justice Kennedy wrote: “the government lacks the power to restrict political speech based on the speaker’s corporate identity.” Clearly, the Supreme Court was now looking at commercial speech from the perspective of the corporate speaker, not the listener or consumer.

In 2011, the Supreme Court struck down a Vermont law that banned data mining companies from selling information on prescription usage to drug companies. Although the case did not pertain to “speech” in a traditional sense because it involved the sale of commercial information, Justice Kennedy again wrote for the majority, stating: “[s]peech in aid of pharmaceutical marketing … is a form of expression protected by the Free Speech Clause of the First Amendment.” Applying “heightened judicial scrutiny” because the Vermont law was a content- and speaker-based restriction, the Supreme Court held that the statute was unconstitutional.5

In 2015, the Supreme Court held that an Arizona town’s sign code was unconstitutional because it regulated speech-based content.6 Writing for the majority, Justice Thomas applied strict scrutiny to the town’s code, explaining that because the code had different rules for “temporary directional signs” used by churches and others as compared to other types of signs, the code was a content-based regulation on its face. In a concurrence, Justice Breyer argued that 1 2 3 4 5 6 7 8 9 10 11 12

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there was no basis to apply this heightened level of scrutiny to the code because this would lead to numerous other challenges to government regulations, which could not survive this heightened test. Among those mentioned were regulations of securities, regulation of prescription drugs, protection of doctor-patient confidentiality, income tax statements, commercial airplane flight procedure briefings, and even signs at petting zoos recommending persons wash hands upon exiting the area.

“PROFOUND SHIFT” IN COMMERCIAL SPEECH PROTECTION Most recently, in June 2018, the Supreme Court relied upon the First Amendment and Reed to strike down a California law that required certain licensed and unlicensed family planning centers (most or all of which were pro-life pregnancy centers) to make certain written disclosures to patients.7 In a 5-4 opinion again authored by Justice Thomas, the Court held that this compelled speech by the State of California was a “content-based” regulation and therefore unconstitutional under the strict scrutiny applied to such laws. In so ruling, the Court seemingly departed from some of its prior decisions and expanded the First Amendment protections applicable to commercial free speech. As one commentator noted in the Harvard Law Review, this case “marks a profound shift in the Court’s treatment of compelled commercial disclosures. … Taken as written, [the decision] represents a dramatic expansion of the scope of First Amendment protection for commercial speech and threatens the entire foundation of a broad range of consumer protections.”8 LOWER COURTS GRAPPLE WITH COMMERCIAL FREE SPEECH ISSUES

Even before this most recent Supreme Court case, which seems to have dramatically expanded commercial free speech rights, businesses had filed numerous lawsuits successfully challenging laws on the grounds that they impermissibly regulated commercial speech. Here are just a few examples (of many):

Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748 (1976).

Central Hudson Gas & Electric Corp. v. Public Service Commission of New York, 447 U.S. 557 (1980).

Zauderer v. Office of Disciplinary Counsel of Ohio, 471 U.S. 626 (1985).

Citizens United v. Federal Election Commission, 558 U.S. 310 (2010).

Sorrell v. IMS Health Inc., 564 U.S. 552 (2011).

Reed v. Town of Gilbert, Arizona, 135 S.Ct. 2218 (2015).

National Institute of Family & Life Advocates v. Becerra, 138 S.Ct. 2361 (2018).

132 Harvard L. Rev. 347 (2018).

National Association of Manufacturers v. SEC, 800 F.3d 518 (D.C. Cir. 2015).

Gresham v. Rutledge, 198 F. Supp. 3d 965 (E.D. Ark. 2016).

Ocheesee Creamery LLC v. Putnam, 851 F.3d 1228 (11th Cir. 2017).

Kimberly-Clark Corp. v. D.C., 286 F. Supp. 3d 128 (D. D.C. 2017).

• In 2015, the D.C. Circuit struck down an SEC rule that required public companies to disclose whether their products contained “conflict minerals” related to the civil war in Congo.9 The Court held that the rule was unconstitutional because it compelled companies to speak and the SEC could not justify the rule under the intermediate scrutiny test of Central Hudson.

• In 2016, the Arkansas District Court struck down a state statute that prohibited automated telephone calls on the grounds that it was a content-based restriction on commercial speech that violated the plaintiffs’ First Amendment rights.10 The Court applied the strict scrutiny test of Reed and held that Arkansas failed to justify its statute under that test.

• In 2017, the Eleventh Circuit held that a Florida law was unconstitutional under the First Amendment and the Central Hudson test because it prohibited a creamery’s truthful use of the term “skim milk” to describe its product merely because it did not contain Vitamin A.11 • In 2017, the D.C. District Court struck down a D.C. ordinance that required makers of disposable wipes to not label wipes as “flushable” and to instead state that they “should not be flushed” if the wipes failed a three-part test for “flushability.” The court held that the law violated the manufacturer’s First Amendment rights under the Central Hudson test because D.C. did not consider less restrictive alternatives to the ordinance.12 WHAT’S NEXT? As Justice Breyer predicted, courts increasingly are being used to strike down laws on the grounds that they unconstitutionally infringe a business’s commercial free speech rights. Although this use of the First Amendment may be counterintuitive to many, there is no doubt that businesses today have a potent new weapon in the First Amendment to challenge laws and regulations that restrict their activities. Although the law continues to evolve in this area, it is safe to predict that the current Supreme Court will only continue to expand these rights as new cases come before it.

William S. Fish, Jr. is a partner at Hinckley Allen. Bill’s practice spans a range of legal disciplines including corporate, commercial litigation, bankruptcy and creditors’ rights, real estate, and the First Amendment. He’s been recognized as a Best Lawyer “Lawyer of the Year” six times in multiple disciplines since 2011.

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Regulations Remain Hazy around CBD Use in Supplements Marc S. Ullman

On December 20, 2018, President Trump signed the Agricultural Improvement Act of 2018, known as the Farm Bill, into law. Of the many provisions of this legislation, the “Hemp Legalization Amendment” received by far the most public attention.1 As a result “industrial hemp,” defined as Cannabis Sativa plants that contain less than 0.3 percent THC (tetrahydrocannabinol, which is the psychoactive ingredient in marijuana), has been removed from the Drug Enforcement Administration’s definition of Marijuana Extract. Industrial hemp is, therefore, no longer a controlled substance, and is legal to cultivate for commercial purposes everywhere in the United States.

The new status granted industrial hemp is expected to open a wealth of legitimate business opportunities for not only the farming sector, but for businesses interested in what can be manufactured from the byproducts of the plant, from healthy oils and protein for use in food to textiles

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and durable goods. The one notable exception may be the market for CBD (cannabidiol), a constituent of virtually all species of hemp, which has been flourishing in the grey areas of the dietary supplement industry. The problem for CBD, the companies that market it and the consumers who are looking to purchase it is that the farm bill did nothing to alter the status of industrial hemp under the Federal Food Drug and Cosmetic Act (FDCA) as enforced by the Food and Drug Administration (FDA).

FDA AND CBD

FDA’s position on CBD is straightforward: CBD is not a legal ingredient for use in foods or dietary supplements. This was expressly stated in a June 2018 Guidance Document, “FDA and Marijuana Questions and Answers,” in which the Agency poses the question, “Can products that contain THC or cannabidiol (CBD) be sold as dietary supplements?” According to the agency:

Based on available evidence, FDA has concluded that THC and CBD products are excluded from the dietary supplement definition under sections 201(ff) (3)(B)(i) and (ii) of the FD&C Act, respectively. Under those provisions, if a substance (such as THC or CBD) is an active ingredient in a drug product that has been approved under 21 U.S.C. § 355 (section 505 of the FD&C Act), or has been authorized for investigation as a new drug for which substantial clinical investigations have been instituted and for which the existence of such investigations has been made public, then products containing that substance are outside the definition of a dietary supplement. FDA considers a substance to be “authorized for investigation as a new drug” if it is the subject of an Investigational New Drug application (IND) that has gone into effect. Under FDA’s regulations (21 CFR 312.2), unless a clinical investigation meets the

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limited criteria in that regulation, an IND is required for all clinical investigations of products that are subject to section 505 of the FD&C Act.

There is an exception to sections 201(ff)(3)(B)(i) and (ii) if the substance was “marketed as” a dietary supplement or as a conventional food before the drug was approved or before the new drug investigations were authorized, as applicable. However, based on available evidence, FDA has concluded that this is not the case for THC or CBD. For more information on this provision, including an explanation of the phrase “marketed as,” see, Draft Guidance for Industry: Dietary Supplements: New Dietary Ingredient Notifications and Related Issues. (citation omitted)

The Q&A supports FDA’s conclusion that CBD is excluded from the dietary supplement definition under 21 USC §331 by citation to public disclosure by GW Pharma of “substantial clinical investigations” pursuant to an Investigational New Drug Application for its cannabidiol drug, Epidiolex, in a May 7, 2014, press release and a November 26, 2007, press release concerning GW’s approval of an Investigational New Drug Application for its drug Sativex, which contains a mixture of CBD and THC. More recently, at the Council for Responsible Nutrition Annual Conference in October 2018, Steve Tave, director of the FDA’s Office of Dietary Supplements, explained, “Just because we (FDA) have not taken enforcement action (against CBD products that do not make claims), people seem to think it is OK.” However, “anyone who thinks it is lawful is mistaken.”2 CBD-FREE HEMP FOODS?

The FDA’s position does not mean that companies wishing to market hemp-based supplements or food must remove all traces of CBD from their products. As long as food or supplement ingredient suppliers do not manipulate the CBD content of the products, use “traditional” extraction methods, and marketers do not “call out” CBD content, FDA will have no regulatory concerns.

Hemp products containing trace amounts of CBD are on the same footing as Chinese red yeast rice products containing trace amounts 1

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of the naturally occurring constituent monacolin K, which is also known as lovastatin.

As explained by the FDA and the 10th Circuit Court of Appeals in Pharmanex, Inc. v. Shalala in 2000, there was no question that traditionally prepared red yeast rice had been marketed as a food and used in traditional Asian medicine for its cardiovascular benefits for many years and that it naturally contained monacolin K, which is chemically identical to the active ingredient lovastatin in the prescription drug, Mevacor®. In fact, Merck discovered the efficacy of lovastatin after studying red yeast rice. Traditional red yeast rice, however, does not contain more than trace amounts of lovastatin, and there is no evidence that it was marketed for consumption because of the presence of lovastatin prior to Merck’s marketing of Mevacor®. Thus, while it remained possible to market traditionally prepared red yeast rice following the approval of Mevacor®, the Court found it within FDA’s power pursuant to sections 201(ff) (3)(B)(i) and (ii) of the FD&C Act to prohibit the marketing of red yeast rice with claims relating to lovastatin or where the manufacturing process had been adjusted to manipulate the amount of lovastatin.

BUT WHAT’S HAPPENING IN THE MARKET? Despite the FDA’s seemingly clear pronouncements that CBD is not a legal ingredient, it can be found in many foods and beverages, dietary supplements and even topically applied ointments. Media coverage of these products abounds.

• On October 8, 2018, CNN.com described CBD as “the USA’s coolest food and drink ingredient”; • On January 17, 2019, an article on FoodNavigator.com detailed the market launch of New Age Beverages’ Marley brand of CBD-infused drinks. While the company described its decision not to make any performance-related claims for CBD, the ingredient is featured prominently in the front panel of the drinks’ cans; and • On January 15, 2019, The Atlantic covered CBD-infused cupcakes sold out of Weed World Candies trucks in Manhattan, noting their ready availability despite the significant questions concerning their illegality.

•

At New York State Bar Association’s an-

E.g., “Hemp is about to be legal under the 2018 Farm Bill. You can’t get high from it — but you can wear it”, LA Times, December 19, 2018

2 https://www.nutraingredients-usa.com/Article/2018/11/06/Top-FDA-official-Anyone-who-thinks-CBD-is-lawful-

is-mistaken E.g, Stanley Brothers Social Enterprises, LLC 10/31/17, https://www.fda.gov/ICECI/EnforcementActions/ WarningLetters/2017/ucm583192.htm 4 Letter to Marc Ullman, Esq. Re: Docket No. FDA 2009-P-0298, February 3, 2011.

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nual meeting, speaking at the session presented by the Committee on Cannabis, Dr. Daniel Fabricant, president of the Natural Products Association, stated that his organization believes that there are more than 1,400 foods, beverages and dietary supplements currently being marketed as containing CBD as an ingredient.

Given its absolute statements of illegality, the FDA’s response has been surprisingly timid. Since October 2015 it has issued a half dozen Warning Letters to companies marketing foods and supplements for CBD content, but each of these letters has also cited numerous unapproved drug claims3.

FDA has not taken any enforcement action, however, against CBD products that do not carry such claims.

WHERE TO FROM HERE? The same part of the FDCA that blocks CBD foods and supplements also allows the Secretary of Health and Human Services to promulgate a regulation permitting their use. FDA has never published any guidance advising of the factors it would consider in issuing such a regulation, and it has rejected the only petition submitted on the subject without addressing the merits of the request, instead citing highly technical reasons as the basis to refuse to even consider the issue.4

Given FDA’s position that CBD is not permitted as an ingredient in food, beverages or dietary supplements, its hostility to permitting a “drug” ingredient to be used in food, and its simultaneous failure to take any enforcement action against the numerous CBD products on the market, it seems that the market will remain in limbo for some time. Companies with a strict policy of compliance with FDA laws and regulations will continue to decline to manufacture or distribute CBD products, while others who are not as risk-averse will play in the market.

Whether this state of affairs is sustainable seems doubtful, as it is very unusual for a federal regulator to oversee a marketplace that disregards its authority. Where we will end up, however, remains to be seen.

Marc S. Ullman, of counsel to Rivkin Radler LLP, counsels clients on all aspects of FDA regulatory issues, with a focus on the dietary supplement/natural products industry. He represents clients in Federal Trade Commission proceedings and litigation concerning consumer protection compliance and response to enforcement actions.

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STRUCTURED SETTLEMENTS IN WORKERS’ COMPENSATION CLAIMS: A CREATIVE APPROACH TO SETTLEMENT Brian Annandono

The structured settlement is a well-established and effective method for settling workers’ compensation claims. Beyond the traditional use of the structured settlement for negotiations only, the structured settlement annuity is an excellent tool for evaluating exposures and building a strong settlement strategy before negotiations begin.

A UNIQUE APPROACH TO SETTLEMENT

A structured settlement is an alternative to a cash-only settlement, incorporating a combination of up-front cash and future periodic payments designed to meet specific needs of a claimant. This unique approach to claims settlement was established in 1983 by the United States Congress through revisions to the Internal Revenue Code and provide for these periodic payments to be paid to claimants on an income tax-free basis.

Settlement consultants help carriers and self-insured corporations settle cases creatively and often for less money than allcash settlements. The services provided by settlement consultants are offered at no cost to the parties. Moreover, claimants value the tax advantages, flexibility and guarantees inherent in the structured settlement annuity.

Structured Financial Associates

COUNSEL AS SETTLEMENT ADVISOR Appropriately, representatives from self-insured corporations and carriers look to Counsel for advice on settlement strategy, and Counsel is well-served by encouraging clients to include discussion of a structured settlement during the settlement evaluation stage. Including a structured settlement expert during the evaluation phase will help form a well-rounded settlement team and lead to broader discussions of strategy ideas and settlement funding options.

Does Your Client Want To Settle?

Before addressing the possibility of using the structured settlement tool, Counsel needs to determine if the client wants to settle the claim. Settling a workers’ compensation claim puts a fixed cost on exposure and eliminates the uncertainty associated with an open claim, as well as ongoing legal or administrative costs. With a structured settlement, carriers and self-insured corporations transfer risk to life insurance companies that issue structured settlement annuities, while allowing the claimant to continue to receive ongoing payments for medical costs and living expenses.

CLAIM EVALUATION

The structured settlement annuity can be used during the settlement evaluation process, providing an additional method for evaluating present-day costs of existing workers’ compensation benefits.

The life insurance companies that issue structured settlement annuities may evaluate mortality risk and determine if a claimant’s life expectancy is reduced for any reason. A reduced life expectancy means lower annuity costs. This information helps carriers and self-insured corporations assess their exposure, evaluate their reserves and decide if it is appropriate to settle complex cases.

Age rating is one method of expressing the evaluation of an individual’s life expectancy. Life insurance companies analyze a claimant’s medical records and co-morbidities (i.e., hypertension, diabetes, smoking, etc.) to determine if the claimant has a reduced life expectancy. Following medical underwriting guidelines and based on a claimant’s medical history and current health conditions, life insurance companies may determine that the claimant has a reduced life expectancy and issue a rated age.

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Example of Age Rating and Impact on Present-day Cost

John’s chronological age is 54, with a normal life expectancy of 26.3 years. After reviewing John’s medical records, a life insurance company determines that, based on John’s health conditions, he has a reduced life expectancy. The life insurance company issues a rated age of 61, meaning the life company has determined that John has the life expectancy of a 61-year-old male or 20.8 years; this is 5.5 years shorter than the normal life expectancy of a 54-year-old male.

How does the rated age translate to a lower settlement cost?

The life insurance company can offer the same annuity benefits at a lower annuity cost because they expect to make payments for a shorter duration of time due to the anticipated reduced life expectancy.

Example: Assume that John is currently receiving workers’ compensation benefits of $1,000 per month. The present-day cost of an annuity to provide $1,000 per month for life, based on the normal life expectancy of a 54-yearold, is $208,585. By contrast, the present-day cost to provide a lifetime annuity for a 61-year-old male is $178,564. By utilizing a rated age, the employer will realize a total savings of $30,000.

STRUCTURING MEDICARE SET-ASIDES

In recent years, the structured settlement has been especially effective in the evaluation, negotiation and settlement of claims that involve Workers’ Compensation Medicare Set-Aside Agreements (WCMSA).

The structured settlement is an excellent tool to illustrate how future Medicarecovered medical expenses can be provided for, thus helping claimants protect their eligibility for Medicare benefits.

Moreover, it allows carriers and self-insured corporations to settle these claims with minimal risk, knowing that they have provided a thoughtful post-settlement financial plan for claimants to manage their medical treatment. Further, structured settlement-funded WCMSAs help claimants effectively manage their WCMSA funds.

Additionally, structured settlements can provide significant savings on WCMSAs. Purchasing a structured settlement annuity costs less than funding a WCMSA with a lump sum of cash.

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A STUDY OF SETTLEMENTS INVOLVING MSAS

Structured Financial Associates, Inc. has participated in the handling of more than 800 claims involving WCMSAs for a large national insurer. Of those 800 claims, 427 were successfully structured with a combination of cash and structured settlement annuity. Prior to utilizing structured settlements, this insurer would typically settle claims involving a WCMSA with a lump sum settlement. The exposure and lump sum settlement value on these 427 claims was $50,628,100. In contrast, the present-day cost to settle and fund the WCMSAs with up-front cash (seed funding) and a structured settlement annuity was $31,753,100, a savings of $18,875,000 (37%).

The Centers for Medicare and Medicaid Services (CMS) accepts WCMSAs that are funded by annuities, and funding can be modified to match final CMS determinations. Settlement consultants also collaborate with Medicare compliance experts and companies that provide professional administration to ensure that the MSA is funded and managed properly.

CREATIVE SETTLEMENT PLANNING

In addition to the numerous ways to use the structured settlement in various aspects of the settlement process, it is important to remember the fundamental value of the structure: Creative settlement planning to resolve challenging cases.

Negotiating the settlement of a workers’ compensation matter on a cash-only basis is challenging, and cash is one-dimensional. Using a structured settlement presents a unique opportunity for claimants to convert existing wage compensation benefits into a revised payment plan to meet their short- and long-term financial needs.

Claimants can receive a lump sum of cash plus annuity payments that are secure and income tax-free. The parties have flexibility to design annuity payments for life or for a certain amount of time, and to occur weekly, monthly, annually, or periodically in lump sums at pre-determined milestones.

Settlement of a Death Benefits Case

A consultant with Structured Financial Associates, Inc. was recently invited by Counsel for a self-insured employer to participate in the evaluation and settlement of a death benefits claim, and the experience exemplifies the importance of assembling a productive settlement team.

The claimant, a surviving spouse, was receiving bi-weekly benefits of $1,475. The employer’s reserve was set at $825,000.

Counsel for the employer included a structured settlement expert in the evaluation of the employer’s exposure, and it was determined that the present-day cost of a lifetime structured settlement annuity to replace the current benefits was slightly less than the third-party administrator’s evaluation of the exposure.

Counsel collaborated with the settlement consultant on a letter to the claimant, including a request to meet in-person to discuss settlement and a few settlement proposals that included both immediate cash and annuity payment ideas. When the parties met, Counsel explained the reasons the employer wanted to settle. The spouse’s questions were answered, and settlement options were reviewed. Input from the decedent’s spouse led to the creation of other structured settlement options for her review. It was clear that the spouse was ready to settle, and a settlement plan was designed and accepted.

Ultimately, the claimant accepted a settlement plan that included an immediate $25,000 lump-sum, plus lifetime annual payments of $18,461. The annual annuity payments included a 30-year guarantee so that if the claimant died, the remaining unpaid annual installments would be payable to her daughter as her beneficiary. The settlement plan had a present-day total cost of $750,000, significantly lower than the employer’s reserve of $825,000, and included a guaranteed payout of over $1,130,000.

MANAGING THE FINAL RESOLUTION Following settlement, a settlement consultant assists the parties – Counsel, risk managers, claims handlers, claimants – to bring the claim to final closure, including finalizing settlement documents and gaining approval from the workers’ compensation board or commission. After settlement, there are no ongoing legal or administrative costs, and the case is settled and permanently closed.

The structured settlement is an excellent tool for building a strong settlement strategy, evaluating exposures and resolving workers’ compensation claims.

Brian Annandono is a Certified Structured Settlement Consultant with Structured Financial Associates, Inc. in Cleveland, Ohio.

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To Be or Not to Be… A Fiduciary:

Examining the Revised CFP Code Alexandria M. Ransom

Individuals in the financial services in dustry often possess multiple professional designations and are governed by several regulatory bodies. One non-governmental regulatory body, the Board of Directors of the Certified Financial Planner Board of Standards, Inc. (the “CFP Board”), regulates all financial planners designated as Certified Financial Planner Professionals (CFP Professionals”). The CFP Board has proposed a new Code of Ethics and Standards of Conduct (“Revised CFP Code”), which is effective on October 1, 2019.1 In the United States, more than 82,000 individuals are certified as CFP Professionals, and all such individuals must abide by the Revised CFP Code in order to maintain a CFP designation. This Article will (i) focus on the new fiduciary standard imposed by the Revised CFP Code, (ii) discuss the role of the Revised CFP Code in the larger regulatory scheme for financial services, and (iii) explore criticisms of the Revised CFP Code.

Simmons Perrine Moyer Bergman PLC

UNPACKING THE NEW FIDUCIARY STANDARD Though CFP Professionals are presently governed by the Current Standards of Professional Conduct, the Revised CFP Code departs from the prior standards in numerous ways. This Article focuses on one of the changes: the new fiduciary duty standard, including the adoption of the term “Financial Advice.” However, keep in mind that there are other significant changes, including but not limited to changes to the definitions of terms, such as “Financial Planning,” and heightened disclosure and conflict of interest requirements.

The Revised CFP Code is divided into two sections. The first section contains a sixpronged code of ethics, which requires the CFP Professional to, among other things, “[a]ct in the client’s best interests” and “[a] void or disclose and manage conflicts of interest.” The second section comprises the bulk of the Revised CFP Code and describes standards of conduct that offer a practical application of the code of ethics described

above. Additionally, the second section contains a new fiduciary duty standard.

Under the Current Standards of Professional Conduct, a CFP Professional must act as a fiduciary when providing financial planning. Under the Revised CFP Code, a CFP Professional must uphold certain fiduciary duties and act in the client’s best interests at all times when providing Financial Advice (as defined below) to a client.

Financial Advice is defined as: A. A communication that, based on its content, context, and presentation, would reasonably be viewed as a recommendation that the Client take or refrain from taking a particular course of action with respect to:

1. The development or implementation of a financial plan; 2. The value of or the advisability of investing in, purchasing, holding, gifting, or selling Financial Assets; 3. Investment policies or strategies, portfolio composition, the management of Financial Assets, or other

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financial matters; 4. The selection and retention of other persons to provide financial or professional services to the client; or B. The exercise of discretionary authority over the Financial Assets of a client.

The determination of whether Financial Advice has been provided is an objective rather than subjective inquiry. The more individually tailored the communication is to the Client, the more likely the communication will be viewed as Financial Advice.2

Financial Advice does not mean responses to directed orders, “the provision of services or the furnishing or making available of marketing materials, general financial education materials, or general financial communications that a reasonable CFP professional would not view as Financial Advice.”

When providing Financial Advice, the CFP Professional must: (1) act in the best interests of the client; (2) abide by a duty of loyalty by (i) placing the client’s interests above the interests of the CFP Professional (and the CFP Professional’s firm), (ii) avoiding or disclosing and managing conflicts of interest, and (iii) acting solely with regard to the client’s interests, including financial interests; (3) abide by a duty of care by acting with the care, skill, prudence, and diligence of a prudent professional in light of the client’s circumstances; and (4) adhere to the client’s instructions (including the client’s objectives and restrictions).

As further discussed below, this fiduciary standard has been subject to criticism, much of which is characterized as the inconsistent and redundant nature of the fiduciary code as compared with the standards of conduct imposed by other regulatory bodies.

THE REVISED CFP CODE’S ROLE IN THE OVERARCHING REGULATORY SCHEME Numerous bodies regulate the financial services industry. Recently, the United States Department of Labor (“DOL”) and the Securities and Exchange Commission (“SEC”) have both proposed rules regulat1

2

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ing financial services. Specifically, the DOL proposed a Fiduciary Duty Rule set to take effect in 2017 that would have imposed fiduciary standards on advisors working with retirement accounts. However, the Fifth Circuit Court of Appeals struck down the Fiduciary Duty Rule, and the DOL refrained from seeking review of the Fifth Circuit decision, so the Fiduciary Duty Rule is not currently in effect. Though current policies mandate that broker-dealers make recommendations that are suitable considering a consumer’s specific circumstances, the SEC has proposed the Regulation Best Interest, which would require that broker-dealers act in a client’s best interests under particular circumstances and make certain heightened disclosures. The Regulation Best Interest also explains fiduciary duties owed by investment advisors. The Regulation Best Interest was proposed in April 2018, though the rule has not yet been enacted.

Further, certain states have also recently introduced or enacted legislation regulating the financial services industry, including without limitation Connecticut and Nevada. Critics of the Revised CFP Code argue that a patchwork quilt of regulations imposed on the financial services industry by federal and state governments, as well as non-governmental organizations, will result in both inconstant and duplicative standards of conduct for financial professionals, though the CFP Board argues that the Revised CFP Code either meets or exceeds the requirements of other standards of conduct imposed on financial planners.

CRITICISMS OF THE REVISED CFP CODE There are numerous criticisms of the Revised CFP Code, and the CFP Board has responded to many of the criticisms in the Commentary to Code of Ethics and Standards of Conduct.3 Among these criticisms, commenters argue that financial professionals will be required to potentially provide unnecessary services to clients, which could increase the cost of providing financial services to lower net worth clients.

The CFP Board has responded by stating

New Code of Ethics and Standards of Conduct, CFP Board, available at https://www.cfp.net/for-cfp-professionals/professional-standards-enforcement/code-and-standards.

Code of Ethics and Standards of Conduct, CFP Board, available at https://www.cfp.net/docs/default-source/forcfp-pros---professional-standards-enforcement/cfp-board-code-and-standards.pdf?sfvrsn=11.

To provide clarity, the term “Financial Assets” is defined as “[s]ecurities, insurance products, real estate, bank instruments, commodities contracts, derivative contracts, collectibles, or other financial products.”

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Commentary to the Code of Ethics and Standards of Conduct, CFP Board, available at https://www.cfp.net/ docs/default-source/for-cfp-pros---professional-standards-enforcement/cfp-board-code-and-standards-with-commentary.pdf?sfvrsn=9.

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Regulation of Financial Planners, Financial Planning Coalition, available at http://financialplanningcoalition. com/issues/regulation-of-financial-planners/.

that CFP Professionals will not be required to provide financial planning to clients who do not desire such planning and that it is beneficial to all clients, including lower net worth clients, that CFP Professionals are held to a fiduciary standard when providing Financial Advice. Additionally, there are questions as to whether the Revised CFP Code could constitute a basis for imposing third-party liability on CFP Professionals, though the Commentary to Code of Ethics and Standards of Conduct states that the Revised CFP Code is not intended to “be a basis for civil liability and that Clients of a CFP professional and other third parties are not intended to be considered thirdparty beneficiaries of a CFP professional’s agreement to adhere to the Code and Standards.”

After October 1 of this year, if a CFP Professional violates the Revised CFP Code then such individual could be subject to discipline, which could include private censure, public sanction, suspension, or even revocation of the CFP Professional’s certification. The heightened standards could result in individuals and firms surrendering their CFP certifications in order to avoid compliance with the Revised CFP Code, as CFP Professionals and firms employing CFP Professionals ask themselves— is the cost of compliance worth the benefit of maintaining a CFP designation?

CONCLUSION The Revised CFP Code will potentially affect a large number of individuals and entities providing financial services, and it is important to consider the Revised CFP Code’s place in the larger regulatory scheme governing financial services.

Additionally, if you need one more thing to keep on your radar, the Financial Planning Coalition (an organization made up of the CFP Board, the Financial Planning Association, and the National Association of Personal Financial Advisors) currently advocates for the adoption of a uniform standard regulating financial planners — modeled after the CFP certification.4

Alexandria M. Ransom is an associate at Simmons Perrine Moyer Bergman PLC in Cedar Rapids, Iowa, where she is in general practice. She earned her JD from the University of Iowa College of Law. She has been selected to the Iowa Chapter of the Order of the Coif.

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Through the Thicket:

Issues When Working In, or With, the Legal Cannabis Industry Michael McGrory

INTRODUCTION

The cannabis decriminalization movement continues to flourish. A significant majority of states have legalized medical marijuana, and an increasing number have legalized recreational marijuana. This growth presents tremendous opportunity, both for investors and entrepreneurs who wish to work directly in the cannabis industry, and for existing businesses that wish to work with the cannabis industry. But this opportunity is not without obstacles and risk, not the least of which is that cannabis remains illegal under federal law. This

SmithAmundsen

article will address the broad contours of state marijuana programs, as well as some of the more noteworthy hurdles cannabis businesses face as a result of the continued federal illegality.

STATE LAWS Each state that has implemented a form of cannabis decriminalization has done it differently. Most significantly, they differ in the uses permitted. Most states have approved medical marijuana, which allows qualifying patients to purchase cannabis products. Some states have approved only

high-CBD/low-THC forms of cannabis for medical purposes (THC is the psychoactive component of cannabis, so this form would not produce the “high” typically associated with the plant). A smaller—but growing—number of states allow adults to use marijuana for recreational purposes, and in many respects treat it just like alcohol.

Even among states with similar approaches, there can be significant differences in the fundamental structure of a state’s system.

For example, some states allow people to grow their own marijuana, while others permit only licensed commercial cultivators.

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Each state has also implemented its own regulatory framework, and these rules can vary significantly by jurisdiction. This patchwork of laws poses difficulties, particularly since regulatory compliance is absolutely key for cannabis businesses, since operating outside the rules is likely to be considered a criminal act even under state law. To be sure, as the cannabis industry has matured, and as lawmakers have learned from other states, certain common regulatory principles have emerged. For example, most states have regulations pertaining to cannabis facility security, labeling and packaging requirements, product tracking, and other safety issues. But the devil is in the details, and the differences that remain are such that nobody should embark on a cannabis industry venture without a thorough understanding of the applicable rules.

FEDERAL POSITION

Polls show a majority of Americans favor legalizing cannabis, and it is impossible to ignore the increasing decriminalization at the state level. Nevertheless, under federal law, cannabis remains a Schedule I drug, meaning that the DEA believes it has a high potential for abuse and no recognized medical use. This categorization puts marijuana in the same class as heroin, LSD, and ecstasy. Efforts to persuade the DEA to re-schedule cannabis have thus far been fruitless. The industry is hopeful that Congress will take action in the near future, but as of this writing, anyone who grows, sells, or possesses cannabis is committing a federal crime, regardless of what a particular state may say. (The law in this area tends to move quickly, and it would not surprise this author at all if the federal government has passed cannabis legislation by the time of publication).

The federal illegality creates all sorts of problems for the cannabis industry. For example, cannabis businesses can struggle to turn a profit because they are not entitled to the same tax deductions that federally legal businesses can take. They have also found it difficult to protect their intellectual property, since the most robust patent and trademark protections are federal.

Landlords, equipment lessors, and cannabis business owners worry about criminal prosecutions, RICO lawsuits, and property forfeiture. Many more of the things traditional businesses may take for granted are also hard to come by for the cannabis industry, e.g., adequate legal advice, property and liability insurance, banking services, and bankruptcy protections.

Though the federal government has not yet offered any legislative fixes, it has

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recognized and attempted to deal with some of the problems created by the state/ federal conflict. Its efforts, though, have largely been unsuccessful. The Department of Treasury attempted to address the cannabis industry’s banking problem by issuing guidance to banks on how to comply with money laundering laws when serving cannabis customers. Nevertheless, most large banks remain wary of the compliance costs and regulatory risks. In 2013, the Department of Justice issued what has come to be known as the “Cole Memo.”

The Cole Memo sets out the priorities federal prosecutors should consider when deciding whether to prosecute a cannabis business. These priorities included things such as preventing the distribution of marijuana to minors. While the Cole Memo did not change the law in any respect, it provided comfort to state-licensed cannabis businesses who were compliant with state law and otherwise operating responsibly.

Attorney General Sessions rescinded the Cole Memo in early 2018, but many have argued that notions of prosecutorial discretion and the prudent use of enforcement funds continue to militate against prosecuting state-legal cannabis businesses.

Perhaps the most important federal measure affecting the cannabis industry is the Rohrabacher-Blumenauer Amendment (previously the RohrabacherFarr Amendment), which was first enacted as part of the 2014 omnibus spending bill.

The R-B Amendment essentially prohibits the Department of Justice from using federal funds to prosecute state-legal medical marijuana businesses. There are some important caveats. First, the R-B Amendment does not apply to recreational cannabis businesses. Second, the R-B Amendment only protects those businesses that are strictly compliant with a state’s regulatory scheme. And third, the R-B Amendment has served as a temporary stop-gap, and it is possible that it may not be renewed in a future budgetary bill.

The long and short of it is this: marijuana remains illegal under federal law, but there are obstacles to enforcement and protections against enforcement that have thus far prevented a draconian crackdown on state-legal businesses. This situation remains fluid, as more states come online with new or broadened programs, and the federal government decides how to deal with this trend.

WORKING IN OR WITH THE CANNABIS INDUSTRY

Despite the murky state of the law and the associated risks, people are flocking to

the cannabis industry in droves. It’s easy to see why. While projections vary, there seems to be general agreement that the cannabis industry in the U.S. will continue to thrive, and see revenues in the tens of billions of dollars over the next several years. So of course entrepreneurs want to build cannabis businesses and investors want to invest in cannabis businesses. Other industries want in, too. Equipment manufacturers, software designers, app developers, testing facilities, commercial property owners, lawyers, accountants, and more, all want to serve this booming market. What’s more, optimism abounds that the federal government will take the necessary steps to legitimize the cannabis industry.

Until then, though, those in or around the cannabis industry must be comfortable with ambiguity and understand the risks.

Any state license holder must adopt an attitude of vigilant compliance with applicable regulations. They should assemble a team of trusted employees and advisors, know the law inside and out, and implement foolproof policies and procedures. Even ancillary businesses that do not “touch the plant” should assume a similar mindset.

For one, a state’s cannabis regulations may apply with equal force to the ancillary business, particularly as it pertains to things like entering a cannabis facility. Moreover, ancillary businesses should perform some due diligence with respect to their marijuana industry clients, and ensure that the cannabis business is properly licensed, compliant, and responsible.

CONCLUSION

The growth of the medical and recreational cannabis industry has been nothing short of remarkable. The industry has overcome or sidestepped many obstacles—often in innovative and creative fashion—and there is no reason to believe this growth will stop anytime soon. It remains a risky field, though, and people interested in working in or with the cannabis industry must appreciate that risk, understand the law, and plan their operations in a way that reduces the risks as much as possible.

Michael McGrory is a partner in SmithAmundsen’s Chicago office. He advises clients in the areas of aviation and aerospace law, commercial litigation, regulatory compliance and the emerging medical cannabis field.

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Helmets, Seatbelts, and Comparative Fault

Martin S. Driggers, Jr. and Brandon R. Gottschall

Few would seriously dispute the safety benefits of seatbelts and helmets, or that these benefits are widely understood. Yet many jurisdictions still bar admission of a plaintiff’s failure to use a seatbelt or helmet as evidence of comparative fault. Why is this? Furthermore, are there any trends toward — or away from — increased recognition of seatbelt and helmet defenses?

These issues can have substantial impacts on insurance, from underwriting all the way through trial and beyond.

HELMETS AND SEATBELTS: THE STATISTICS

In 2016, over 7.25 million auto accidents occurred in the United States. Of these, more than 2 million involved injuries, and 23,714 involved fatalities of one or more vehicle occupants. Simply wearing a seatbelt reduces the chance of death by 45% and the chance of serious injury by 50% for drivers and front-seat passengers.

Helmets likewise offer dramatic levels of increased protection to motorcyclists, bicyclists, and others. For example, helmets reduce the risk of death for motorcyclists by 37% and of head injury by 69%. Similarly, the NHTSA states that “[a] helmet is the

Sweeny, Wingate & Barrow, P.A.

single most effective way to prevent head injury resulting from a bicycle crash.”1

Safety organizations widely agree that seatbelts and helmets save lives and prevent injury.

ADOPTION OF HELMET AND SEAT BELT DEFENSES: THE STATUS QUO

While seatbelts and helmets undoubtedly provide substantial benefits, states are far from unified regarding whether to admit evidence of helmet and seatbelt use in litigation. One recent survey2 found that as of August 2017, only 15 states (Alaska, Arizona, California, Colorado, Florida, Georgia, Iowa, Michigan, Missouri, New Jersey, New York, Ohio, Oregon, West Virginia, and Wisconsin) have recognized some variation of the seatbelt defense.

On the other hand, Washington D.C. and another 30 states (Alabama, Arkansas, Connecticut, Delaware, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maine, Mar yland, Massachusetts, Minnesota, Montana, Nebraska, New Hampshire, New Mexico, North Carolina, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, Vermont, Virginia, Washington, and Wyoming) have no seatbelt defense. The

remaining five states were undecided.

Although it is perhaps less litigated, a substantial number of states have rejected the helmet defense, at least in part.

These include Iowa, Washington D.C., South Carolina, Hawaii, and many others.

However, some states recognize variations of the helmet defense, including Arizona, Louisiana, Minnesota, North Dakota, and Wisconsin, among others.

THE LEGAL ANALYSIS

As courts have analyzed whether to recognize helmet and seatbelt defenses, various lines of reasoning have emerged, some supporting—and others opposing— adoption of the defenses. For example, many state courts have begun by examining whether a statutory duty to wear a seatbelt or helmet exists. Where a statutory duty exists, a state is much more likely to recognize a helmet or seatbelt defense. However, somewhat counterintuitively, some state statutes ban the helmet or seatbelt defense in the same statute requiring helmet or seatbelt use in the first place. If a state does not have a statutory duty requiring seatbelt or helmet use (or banning use of the seatbelt and helmet defense), courts often look

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next to common law, although only a few courts have found a common law duty in the absence of a statutory duty.

On the other hand, some courts turn to a proximate cause analysis. For example, several courts have rejected the helmet and seatbelt defense on the grounds that accidents are proximately caused by negligent drivers, not by an injured party’s failure to use a seatbelt or helmet. Notably, though, this analysis has been increasingly challenged on the grounds that, while the absence of a seatbelt or helmet may not be the proximate cause of the accident, it may well be a proximate cause of the injuries themselves.

Yet other states have weighed in their analysis whether recognition of a seatbelt or helmet defense may result in a windfall to a defendant who causes an accident. This concern is more prominent in pure contributory fault jurisdictions where plaintiffs cannot recover if they are even 1% negligent.

Other considerations arise in the various state court discussions regarding seatbelt and helmet defenses, but the above topics are among the most prevalent.

THE TRENDS: TOWARDS OR AWAY FROM WIDER ADOPTION OF THE DEFENSES? National trends regarding seatbelt and helmet defenses tend to develop gradually, with periodic bursts of activity spurred by federal legislation (e.g., legislation tying highway funds to state helmet laws). However, while most jurisdictions still have not recognized seatbelt and helmet defenses, the arguments available to proponents of these defenses appear to be gaining ground. In addition, a few recent developments suggest there may be mounting pressure to recognize these defenses.

Since the 1960s, the viability of many early arguments opposing seatbelt and helmet defenses has eroded. For example, as public awareness of seatbelt and helmet safety benefits has increased, arguments against finding a common law duty to use seatbelts and helmets have weakened.

In addition, the “windfall” arguments popular in jurisdictions with pure contributory negligence regimes have lost steam as many states have adopted comparative negligence standards. These changes potentially pave the way to re-examine seatbelt and helmet defenses in these jurisdictions.

Influential treatises and courts have

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also provided some favorable ground for these defenses. Notably, the seatbelt defense has been supported by the Restatement (Third) of Torts: Apportionment Liab. § 3 (2000) and by recent courts, including the Texas Supreme Court in 2015. Prior to 2015, Texas had rejected the seatbelt defense for decades. However, on re-examination, the Texas Supreme Court found the prohibition of seatbelt evidence to be “a vestige of a bygone legal system and an oddity in light of modern societal norms.”3 Because the helmet defense is so closely related to the seatbelt defense, these developments may also bode well for the former.

In another vein, the Arkansas Supreme Court in 2016 found unconstitutional a state statute barring admission of seatbelt evidence.4 While this holding was somewhat specific to Arkansas’ constitution and seatbelt laws, other state statutes may be subject to similar challenges.

Another factor that could change the status quo, at least with regard to the helmet defense, would be the reenactment of federal measures encouraging states to adopt universal helmet laws. Only 19 states and the District of Columbia now maintain universal helmet laws for motorcyclists as of January 2019, while previously, a vast majority of states had mandatory helmet laws from 1966-1975. This change is primarily due to repeal of federal safety standards tying federal benefits to universal helmet laws.

Should federal encouragement of helmet laws reemerge, the tide may again shift in favor of universal helmet laws. With such laws back in place, courts in those states may be more inclined to find a duty on cyclists to use helmets, resulting in an increased recognition of the helmet defense.

PUTTING THE INFORMATION INTO ACTION

Even in the face of relatively gradual changes in state jurisprudence governing seatbelt and helmet defenses, knowledge of the trends and issues in this area can be of great value to underwriters, claims handlers, subrogation departments, in-house counsel, defense counsel, and others.

There are several practical steps that may prove useful to those facing claims where seatbelt or helmet use may be relevant. These include: • Determining early whether claimants were restrained or helmeted;

NHTSA, Bicyclists and Other Cyclists, in TRAFFIC SAFETY FACTS 2 (May 2018), https://crashstats.nhtsa.dot.gov/ Api/Public/ViewPublication/812580https://crashstats.nhtsa.dot.gov/Api/Public/ViewPublication/812507.

Matthiesen, Wickert & Lehrer, S.C., Seat Belt Defense in All 50 States (last updated 8/31/17), https://www.mwllaw.com/wp-content/uploads/2013/03/Seat-Belt-Defense-In-All-50-States-Chart.pdf.

3 Nabors Well Servs., Ltd. v. Romero, 456 S.W.3d 553, 555 (Tex. 2015).

4 Mendoza v. WIS Int’l, Inc., 2016 Ark. 157, 490 S.W.3d 298 (2016).

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• Determining whether the claimant’s injuries were caused by the failure to use a seatbelt or helmet; • Considering whether the state requires expert testimony on causation to assert the seatbelt or helmet defense and, even where not required, whether an expert may be helpful; • Researching whether statutory caps may limit how much a plaintiff’s recovery may be reduced for failure to wear a helmet or seatbelt; • Researching jurisdictional nuances (for example, some states may require motorcyclists to wear helmets but not bicyclists, and this may impact whether the helmet defense applies); • Staying abreast of federal laws impacting seatbelt and helmet use at the state level; and • Challenging the status quo, as even states with developed jurisprudence may change course (e.g., Texas in 2015).

CONCLUSION Should a favorable trend towards seatbelt and helmet defenses continue to develop, one potential side effect may be the increased use of helmets and seatbelts and, hopefully, a decrease in serious injury or death. That’s good news for motorists, cyclists, auto insurers, health insurers, and just about everyone else. In the meantime, however, careful consideration of the legal issues and jurisdictional trends remains key to the effective defense and prosecution of cases involving helmets and seatbelts.

Martin S. Driggers, Jr. is the managing partner of Sweeny, Wingate & Barrow’s Pee Dee Region office in Hartsville, South Carolina. His practice focuses on civil litigation, with an emphasis on defending clients involved in professional malpractice, administrative law, and general liability.

Brandon R. Gottschall joined Sweeny, Wingate & Barrow, P.A., following a three-year clerkship with the Chief United States District Judge for the District of South Carolina.

Brandon’s focuses on insurance coverage, personal injury defense, premises liability defense, and transportation defense in both state and federal court, as well as state and federal appellate matters.

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We’re Being Sued WHERE? Personal Jurisdiction Alyssa Reiter

Wicker, Smith, O’Hara, McCoy & Ford, P.A.

In The Electronic Age

Alyssa Reiter

Wicker Smith

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Your company hires a social media manager to tweet, blog, and post publicity.

Your IT specialist improves your website so it is more interactive. Now customers can place orders or make reservations online from anywhere and at any time. You attend trade shows and gather contact information that is used to e-mail potential customers.

All of this may grow your business. But, have you thought about the impact that these acts might have if you are sued in another state? For the past 20 years, courts have been grappling with the concept of personal jurisdiction in the electronic age.

VERY BASIC PERSONAL JURISDICTION PRINCIPLES

Personal jurisdiction signifies the extent to which a court can require a party to defend itself in the state where the lawsuit has been filed (the forum state).

Generally, courts can exercise jurisdiction for any reason over parties who reside in the forum state. Beyond that, the Due Process Clause of the 14th Amendment of the U.S. Constitution establishes the outer boundaries of a state court’s authority to proceed against a defendant who does not reside in that forum. This article focuses on “longarm jurisdiction” – a court’s power to assert jurisdiction over non-resident defendants.

Specific jurisdiction is highlighted, meaning that the suit must relate to or arise out of the defendant’s contacts with the forum state.

Many years ago, the Supreme Court of the United States held that courts may exercise personal jurisdiction over an outof-state defendant who has “certain minimum contacts with [the forum State] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.”1 For the 74 years since the Supreme Court made that statement, courts, lawyers, and law students have agonized over what type of contacts and how many contacts will satisfy that standard.

Historically, courts would examine the defendant’s physical presence within the forum state. Examples would include such things as whether the defendant had a home or office in the forum, whether the defendant maintained a bank account in the forum, or whether a business had a sales agent or representative located within the forum. Courts would look at these contacts in order to determine whether the defendant had purposefully availed himself of the benefits of the forum. In the electronic

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age, the issue of the defendant’s contacts with and “purposeful availment” of the forum has become more complicated.

ELECTRONIC-BASED “CONTACTS” When considering the defendant’s “contacts” with the forum state, courts are increasingly called upon to examine various electronic-based activities.

The defendant’s website activity A website can reach any computer plugged in anywhere. Some plaintiffs have argued that a defendant’s maintenance of a website thus exposes it to jurisdiction in any state.

Not surprisingly, courts have been hesitant to find jurisdiction based only on the maintenance of a website. As one court found, an interactive website “should not open a defendant up to personal jurisdiction in every spot on the planet where that interactive website is accessible.”2 However, courts still may factor in website activity as part of the jurisdictional analysis.

Some courts have focused on whether the website is passive, interactive, or active. A passive site is one that simply conveys information. An interactive site is one where users can exchange information with the host.

An active site is one where, for example, a customer can place orders or schedule appointments. Some courts use a sliding scale of website activity to determine whether a defendant has sufficient contacts with the forum.3 The more interactive the site is, the more likely a court is to find jurisdiction.

Courts may also look at such facts as how much money is generated through website activity. If a business is located in a different state but, through internet activity, generates 70% of its revenue through sales to customers in the forum state, that would likely be persuasive to a court when examining jurisdiction. On the other hand, a website might generate no or minimal sales in the forum state, making a court far less likely to use this contact to justify exercising personal jurisdiction.

The defendant’s social media activity

Courts have examined the type of activity that the defendant conducts on social media sites. Does the defendant have, for example, a Facebook account that merely provides information? Or, does the account include links to the defendant’s website?

Courts might also look to how integral the social media site is to the case. For ex-

International Shoe Co. v. State of Wash., Office of Unemployment Compensation and Placement, 66 S. Ct. 154 (1945) (citation omitted).

Advanced Tactical Ordnance Sys., LLC v. Real Action Paintball, Inc., 751 F.3d 796 (7th Cir. 2014).

3 See e.g. Zippo Mfg. Co. v. Zippo Dot Com, Inc., 952 F. Supp. 1119 (W.D. Pa. 1997).

4 SEC v. PlexCorps, No. 17-CV-7007 (E.D.N.Y. Aug. 9, 2018).

5 Blue Water Int’l, Inc. v. Hattrick’s Irish Sports Pub, LLC, No. 8:17-CV-1584 (M.D. Fla. Sept. 21, 2017).

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ample, in a case involving an alleged fraudulent scheme by Canadian defendants, the court was persuaded by the fact that the defendant’s Facebook accounts were integral to finding investors and directing statements at them to encourage them to participate in the fraudulent scheme.4

Jurisdictional issues may arise where a plaintiff resides in the forum and claims injury by virtue of images or text posted on a social media site. Courts may examine whether the posts are specifically aimed at users, beside the plaintiff, within that forum state. At least one court has held that subjecting a defendant to personal jurisdiction in the forum merely because a Facebook user in the forum might view the defendant’s Facebook page offends traditional notions of fair play and substantial justice.5 The defendant’s participation in electronic bulletin boards and chat rooms

Courts may look at the audience of the bulletin board or chat room. Is it a closed group or open to the public? Is the defendant directing his comments to an audience of specific individuals who he knows reside in a specific state?

The defendant’s e-mail activity

Courts may look at the defendant’s e-mail activity. Are forum residents being specifically targeted by the emails? Courts will examine whether the e-mail is related to the cause of action. This may arise, for example, in a defamation case or a fraud claim.

CONCLUSION

None of the electronic communications or internet and social media activity discussed above may be enough, on its own, to subject a defendant to personal jurisdiction in a foreign state. However, the use of social media and other electronic platforms continues to impact legal analyses of issues such as personal jurisdiction. Therefore, in this electronic age, parties may see themselves increasingly sued in states in which they never expected to be sued.

Alyssa Reiter is a partner at Wicker Smith who loved civil procedure in law school. Her practice focuses on appeals and critical motion practice.

In her 31-year career, she has handled more than 100 appeals in a wide range of cases, including product liability, professional malpractice, commercial litigation, and premises liability.

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Using Advanced Technology to Understand Accidents at Night Involving Pedestrians Fawzi P. Bayan PE, CSP

Visibility of pedestrians in night accidents is evaluated in multiple ways from simple observations, to a review of literature, to calculations using published or assumed data, to comprehensive experimental data collection and testing using specialized tools and calculations, to a combination of all the above. Accordingly, the quality and cost of the resulting work product varies widely. The study is always dependent on investigational limitations such as the difficulty of closing a road, obtaining the subject or an exemplar vehicle and matching other conditions. It is also dependent on the available information or the lack of it and as such depends on the reconstruction of the accident.

EVALUATION OF VISIBILITY

A first approach, consisting of viewing the accident site, provides some information although it is essentially of a qualitative nature. For example, it can inform as to the

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presence of oncoming traffic, background clutter, or impact of overhead lights on the illumination of an area but it cannot provide any quantitative data. Although the eye/brain combination can understand the information, it doesn’t provide a “measuring stick” to quantify the data. In addition, the age of the observer and exposure time affect the interpretation and cannot be duplicated by simple observation. Similarly, capturing a photograph or video without a calibration process yields inaccurate results with little to no connection with reality.

A second approach, consisting of reviewing available literature, offers more quantitative data and may be scientifically informative if the conditions of the accident are similar to those of the study in terms of key factors, including color of the clothing, pedestrian position, illumination type and glare. Pedestrian accident data in reputable studies have existed since at least the 1980s for mostly dark roadways, with or

without oncoming glare, and for variously clad pedestrians on different sides of the road. Data on lit roadways is significantly more scarce perhaps because the position, number and types of overhead lights offer so many variables in relation to the multiple possible positions of a pedestrian as to make it very difficult to establish a baseline applicable to all lit roadway pedestrian accidents. New data is, however, becoming available based on naturalistic studies funded by the U.S. government. In these studies, private driver’s vehicles are instrumented for multiple parameters, including speed and forward video of the driver view.

Accidents and near misses are therefore recorded and can be analyzed. In analyzing a given accident, the challenge remains, like in all general studies, to have as many similar parameters as possible.

At night, contrast is one of the key factors to observe a pedestrian. Luminance is the amount of light reflected toward the

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observer’s eye from a surface, such as the coat of the pedestrian. Reflectance of white clothes is higher than that of dark clothes and as such the luminance is also higher.

Contrast is a measure of the relationship between the luminance of the clothes of the pedestrian and the luminance of the background (such as the ground or the sky). In addition to luminance required to calculate contrast, glare is a significant factor in night visibility. Glare is highly dependent on the angle between the glare source and the eye, a value that is changing as the observer and the glare source move toward each other, for example. As such, in trying to quantify this data for a set of accident conditions, the remaining available methods rely on measurements or a calculation of luminance or a combination of both.

Thus, the third approach is based on comprehensive full-scale testing at the accident site with specialized tools under substantially similar conditions as the accident being analyzed. This can often yield the most reliable data. This method consists of recreating a site in order to measure as many of the parameters as possible. Calculations complement this analysis for the parameters that can’t be measured. Direct measurement of luminance and glare at the recreated or exemplar site with the subject or an exemplar vehicle is ideal, while calculations to account for age and the effect of glare, for example, complement the study. In the case where the accident site cannot be used, a similar site in terms of photometric characteristics can be chosen. A vehicle with similar characteristics or an exemplar vehicle can likewise be chosen.

In the case where neither the site nor a vehicle can be used directly, a fourth approach relies primarily on calculations and equations relating the amount of incident light and reflectance of the clothing to calculate luminance of the pedestrian. The background luminance at a site can either be measured or assumed based on literature. Incident light from headlights can be measured directly on a vehicle or found in available literature on vehicle headlight illumination when available. In this situation, the challenge is again to ensure that as many parameters as possible are appropriate and similar to the accident conditions.

LUMINANCE MEASUREMENTS

When luminance measurements can be performed directly, specialized tools can be used that produce a high level of accuracy while allowing for detailed analyses otherwise not possible. Luminance can be measured using a spot meter, which as its name indicates, can measure one point at

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a time. A luminance imaging photometer on the other hand enables an engineer to capture full-scene measurements at once and produce a luminance map with embedded luminance measurements of the entire scene. An example is shown in the luminance image of a pedestrian wearing a reflective vest standing in the middle of the road, talking to the truck driver, and illuminated by an approaching vehicle. It also

sure and otherwise illustrate. Another example is shown below, where a pedestrian tripped on the wheel stop in a lit parking lot. The embedded luminance data of two adjacent areas is illustrated. An effectively infinite number of contrast calculations can be performed in various areas and adapted to the specifics of where and how the accident occurred.

Pedestrian multiple clothing reflectances, movements and positions in relation to lights and glare at night require a careful and often more specialized approach and are well suited to the latest technology of luminance imaging. Visual observations and the evaluation of literature do not provide actual measurements specific to the accident. Calculations alone suffer from the same disadvantage but can be significantly amended by the use of judicious measurements. In the case where full-scale measurements are possible, luminance imaging photometers provide large amounts of data

-286, 138 Luminance 14: 0.3525 cd/m2 -695, 185 Luminance 14: 0.1058 cd/m2

results in the production of informative visuals to illustrate the concept of contrast.

In this case, rather than opining in general terms about the effect of a reflective vest or lack of, the engineer can perform an evaluation specific to the accident conditions with the pedestrian and vehicle placed in the proper reconstructed accident configuration. The colors in the images are directly related to the level of luminance and, in simple terms, the larger the difference in color, the larger the contrast. The images thus convey this concept with the critical added benefit that each pixel is embedded with measured data which is in turn used to perform necessary foundational contrast calculations.

Without the imager, a detailed analysis between adjacent regions is difficult to achieve. For example, contrast between the narrow reflective vest stripe and the rest of the pedestrian body is problematic to mea-

that can be used to perform detailed analysis while providing effective and simple to understand visuals. This technology is available today to evaluate multiple types of pedestrian accident in a clear and convincing fashion that never existed before.

Fawzi P. Bayan PE, CSP is the director of the Vehicle Accident Reconstruction Group in the Baltimore/Washington, D.C. office of SEA, Ltd. He specializes in the reconstruction of transportation accidents. He has published in peer reviewed journals in the areas of accident reconstruction, computer simulation, night perception and conspicuity, and other topics. Mr. Bayan holds a Bachelor of Science degree from the University of Colorado Boulder and a Master of Science degree from Stanford University.

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The Fast & Furious World of Second Requests Peter Ostrega

If the Holmes-Rahe Stress Inventory applied to organizations, even standard merger and acquisition transactions would be near the top of the scale. And the more complex the deal, or the greater the antitrust concerns, the higher the pressure.

Top that with a “Request for Additional Information and Documentary Materials,” also called a “Second Request,” from the Federal Trade Commission (FTC) or the Antitrust Division of the Department of Justice (DOJ), and the stakes can start to feel incredibly high.

A Second Request comes into play for transactions that meet a minimum threshold—currently $84.4 million—under the Hart-Scott-Rodino Antitrust Improvements Act. No matter the industry, all Second Requests share two variables that seem, at first blush, to be diametrically opposed: a potential scope of review that includes an unlimited number of documents and an exceptionally limited amount of time to produce them—sometimes as short as 30

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days. The requested material can span the breadth of an organization, from financial information, business plans, pricing and competitive strategies, industry participation and research and development details all the way to manufacturing and production documentation. A failure to “substantially comply” with the request can prompt a variety of further government action that can be devastating to the success of the deal.

Ensuring that the right material is produced on deadline requires balancing the variables of time, cost and volume of data. While maintaining communication between parties and practicing end-to-end project management are essential ingredients of any production, technology is often the linchpin for success in fast and furious Second Request productions. Leveraging technology-assisted review (TAR, also called predictive coding) can pave the path for success while managing risk and keeping the deal on track.

THE GOVERNMENT HAS EMBRACED THE USE OF ADVANCED EDISCOVERY TECHNOLOGY.

Gone are the days when parties viewed TAR technology as an impenetrable “black box.” In fact, regulatory support for the technology has continued to grow as over the last few years, government agencies have repeatedly voiced their support for using tools such as TAR for identifying and reviewing documents in regulatory matters, including Second Requests.

For example, in 2014, Tracy Greer, the Antitrust Division’s Senior Litigation Counsel for eDiscovery, observed, “The use of TAR offers the promise of reducing the costs incurred by merging parties responding to Second Requests and the size of the document productions received by the Division, without undermining the ability of the Division to conduct an appropriately thorough investigation.” That said, the Antitrust Division has specific requirements for parties that employ “software or tech-

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nology to identify or eliminate potentially responsive documents and information produced in response to [a] Request,” including TAR, search terms and other analytics. Specifically, producing organizations must describe, in detail, how they searched for documents. The agency’s Model Second Request requires that a party seeking to use TAR “submit a written description of the method(s) used to conduct any part of its search” and “include (a) confirmation that subject-matter experts will be reviewing the seed set and training rounds; (b) recall, precision and confidence-level statistics (or an equivalent); and (c) a validation process that allows for Department review of statistically-significant samples of documents categorized as non-responsive documents by the algorithm.”

In 2015, the Federal Trade Commission also revised its Model Second Request permitting the use of TAR, asking that parties describe their collection methodologies and share “all statistical analyses” related to “the precision, recall, accuracy, validation or quality of its document production in response to [a] Request.” In short, a company representative must be able to explain the following: (a) how the software was utilized to identify responsive documents; (b) the process the Company utilized to identify and validate the seed set documents subject to manual review; (c) the total number of documents reviewed manually; (d) the total number of documents determined nonresponsive without manual review; (e) the process the Company used to determine and validate the accuracy of the automatic determinations of responsiveness and non-responsiveness; (f) how the Company handled exceptions (“uncategorized documents”); and (g) if the Company’s documents include foreign language documents, whether [they were] reviewed manually or by some technology-assisted method.

WHICH TECHNOLOGY IS RIGHT FOR YOU: TAR 1.0 OR TAR 2.0?

There are essentially two mainstream versions of TAR. The first, often called TAR 1.0, is a workflow whereby a knowledgeable human reviewer initially codes a subset of documents for relevancy, which are then used as training examples by the TAR software. The goal is to review a minimal subset of documents (Ex. 2,500 out of 500,000) to enable the TAR software to identify likely responsive documents. The training process is iterative and continues until training is deemed complete. Training is complete when additional training examples are no

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longer improving the TAR software’s ability to distinguish between responsive and non-responsive content. To help make this decision, a set of randomly selected documents, referred to as a Control Set, is used to generate metrics that indicate whether training is complete. Once fully trained, the TAR software is capable of identifying likely responsive documents, within a statistical certainty.

In our experience, the DOJ has made the following requests of parties using TAR 1.0.

• A small team of subject-matter experts, not a large group of contract reviewers, must conduct the training rounds.

• All documents must go through TAR; no search terms can be used to cull documents beforehand.

• No review is allowed for documents predicted to be responsive and not privileged.

• The producing party must provide consistency reports that reveal any overturned decisions.

• The documents identified as responsive must achieve an 80 percent recall rate— that’s the percentage of responsive documents in the corpus—using a 95 percent confidence level and a 5 percent confidence interval.

• At the conclusion of TAR, the producing party must provide five random samples (each sample consisting of approximately 400 documents) pulled from the non-produced pile. The DOJ will then select two of these samples and code them.

Unlike TAR 1.0, where the TAR software is trained until training is no longer needed, TAR 2.0 leverages the software to prioritize responsive documents for linear review. Under TAR 2.0, an initial set of example documents (Ex. 50 documents), which may be comprised of previously coded responsive documents, are used by the software to rank the entire dataset based on relevancy. Documents ranked highly responsive are sent for human review, coded for relevancy, and are then submitted as additional training examples. This process of reviewing and training on documents the TAR software ranks as responsive continues until very few responsive documents are being reviewed.

THE BOTTOM LINE: PARTIES INTERESTED IN BENEFITING FROM THE COST SAVINGS AND EFFICIENCY CREATED BY TAR SHOULD SUGGEST USING IT FOR SECOND REQUESTS.

Both versions of TAR are cost-effective, and government support for the latest iter-

ation seems to be on the upswing. When we recently proposed TAR 2.0 in response to a Second Request, the government asked about the following items: • the proposed methodology; • the team who would train the TAR algorithm; • our recall and precision targets; • the categorization of number-heavy documents, such as spreadsheets (which typically don’t do well in TAR); • the presence of other file types such as chats, voicemails and photos; • the presence of foreign language content; • the privilege review plan; and • the availability of metrics to measure review efficacy.

These sophisticated questions show that the government understands TAR 2.0 workflows and appreciates the technology’s ability to find the most relevant documents more efficiently.

Parties using TAR instead of search terms can lower their review budgets.

Producing parties need only perform manual review of potentially privileged responsive documents. But when parties use search terms to identify responsive documents, they must review each document returned as a hit for the terms. In the Second Request scenario, that can require the time-consuming, costly eyes-on review of millions of documents.

Furthermore, intelligent TAR workflows drive more efficiency in the review and production process. With the average cost of manual review hovering around $1 per document, using TAR offers potentially tremendous cost savings. In our studies, parties that chose TAR over full linear review have saved more than 60 percent—even with the complex file types that often populate Second Reviews, including spreadsheets and presentations.

In short, TAR enables parties to deliver a fast and furious, yet accurate and cost-effective, Second Request response.

As a Managing Director at Consilio, Peter Ostrega’s focus is engagement oversight, business relationship management, and pre-litigation consulting. He works closely with in-house and outside legal counsel to help them understand the most effective processes and technologies to manage complex workflows and generate maximum quality, accuracy, cost reduction, and return on investment.

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A Solution in Search of a Problem: Discord over Proposed Changes to Corporate Depositions Keith McDaniel & Kristen Burge

At some point, your corporate client will face a notice for a corporate deposition. Federal Rule 30(b)(6), which governs these depositions, is primed for its first substantive change in nearly 50 years. The proposed amendments will affect organizations of all sizes, in all industries, and in all aspects of litigation. Therefore, it is important to understand the implications of the rule and the potential opportunities to level the playing field should the amendment pass as expected.

Businesses initially viewed the committee’s willingness to amend the rule as an opportunity to combat abusive discovery tactics. Proponents for change viewed this as the long-awaited opportunity to set limits on the permissible number of topics covered in a corporate deposition and to implement a clear mechanism for objecting to the notice. Unfortunately, in its current proposed form, the suggested amendments do little to address these legitimate concerns. Instead, the proposed changes impose new obligations on organizations,

McCranie Sistrunk Anzelmo Hardy McDaniel & Welch

and appear to invite more problems than the amendments aim to fix.

MEET AND CONFER ON TOPICS

The first proposed change would require parties to meet and confer before or shortly after the corporate deposition notice is served and to continue conferring “as long as necessary.” The concept of meeting and conferring is not new to attorneys. Indeed, few would argue that efficient litigation is served through reaching a mutual understanding on the scope of topics to be covered.

At the Judicial Conference Advisory Committee’s public hearing in January 2019, practitioners argued the meet and confer on topics is largely already taking place. Which begs the question, why try to fix something that is not broken?

According to critics, merely mandating the meet and confer is not going to do anything but create an infinite loop and an infinite opportunity for disputes to arise and costs to be incurred. There is no companion framework for raising objections and or a

means to have those objections to the notices resolved before the deposition. Add to that, the meet and confer requirement would not only extend to topics, but to the corporate representative’s identity.

DISCLOSING THE IDENTITY OF THE 30(B)(6) WITNESS

The drafting committee appears to have lost sight of the purpose of 30(b)(6) – to provide a means to depose a non-person. Indeed, the committee’s insistence on the “identity” of the witness overlooks the obvious. The “identity” of the witness is the non-person organization, not the representative speaking on behalf of the entity.

Under the current Rule 30(b)(6), organizations have one requirement: to designate a representative who can testify to the matters set forth in the notice. No more, no less. The proposed amendment would require the parties to confer about the identity of the witness in advance. The proposed rule suggests the noticing party has the right (and the obligation) to influence the selection.

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This arguably undermines an organization’s autonomy and subjects it to new scrutiny.

Indeed, the draft Committee Note suggests that the parties’ exchanges will facilitate “identifying the right person to testify” and qualifies an organization’s right to select its designee with the word “ultimately.” In so doing, the Committee empowers the noticing party to interject its opinion, bias, and gamesmanship into an otherwise straightforward, non-contentious process. According to its critics, this change will invite litigants to weaponize the rule to their advantage, thereby opening Pandora’s Box to collateral litigation and increased costs. And ultimately, some warn the change could lead to a resurrection of the “most knowledgeable witness” standard, as is employed in some state courts.

“If you allow the opponent to come in and challenge the person that you have selected to be the spokesman, and inject the deponent into the process of who is to testify, you’re creating an interesting and very problematic situation,” observed one commentator. To illustrate, consider the following scenario. An attorney notices the corporate deposition of a manufacturing company in a product defects case. Under the proposed rule, opposing counsel would be able to make an argument that the chief R & D of engineering should be designated, not lower engineers. Defending your selection to the judge necessarily would require invading work product and potentially attorney-client privileged information. And regardless of the reason (business related, personal, or strategic), making the change will risk a deposition of the formerly identified representative concerning why he or she could not speak for the company.

IS THE DEPOSITION PERSONAL, CORPORATE, OR BOTH?

Identifying the corporate witnesses muddies the water by confusing the ‘individual deposition’ right that one may have with the ‘corporate deposition’. Indeed, Keith McDaniel, managing partner at McCranie Sistrunk Anzelmo Hardy & Welch has personally experienced this in his practice. “I was defending a corporate deposition for a foreign manufacturer. Plaintiff’s counsel came to me and said, ‘can you tell me ahead of time who’s going to be testifying? We don’t know anything about this manufacturer.’ I did, because I thought it was the right thing to do. . . . We spent four days of depositions going through [the witnesses’] social media, where they had worked in the past, and all of these things and, quite frankly, hardly touched on any areas of the notice.” More time will be spent on personal information with respect to the

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witness than is warranted in the context of corporate knowledge.

The blurring of personal and corporate information changes the intended nature of the process. Whether the witness personally knows about a specific piece of information is not why the witness is there to testify.

Witnesses are made available to answer questions about the company’s knowledge on particular topics. Knowing the identity of the witness naturally influences the selection of documents and areas of inquiry. Proponents suggest the change will enable them to see which part of those documents this witness was involved in and to tailor the questions to those documents. But doing so perpetrates the exact muddling that opponents fear. The corporate deposition will now turn towards asking the person about the things they actually know as opposed to the information that they’ve been made aware of as part of the 30(b)(6) process.

ONE PUNCH AT A TIME, ONE ROUND AT A TIME So, you meet and confer, yet continue to disagree. What’s next? What’s the responding party’s obligation? The proposed amended is silent on the specific procedures available, thus begging more questions than it answers. While prospects appear bleak for this round, it is not too late to advocate for meaningful change.

Now, more than ever, counsel and their clients should urge the committee to adopt changes that level the playing field – particularly with the looming threat of mandatory identity disclosure.

Currently, parties can seek a protective order under Rule 26, but there is no consensus as to its effect. For instance, does the motion delay the deposition until a court rules or must parties move forward and subject the witness to questions about the objectionable topics? And how long must parties confer before one or both conclude they have reached an impasse? No doubt, there will often be one party arguing more conferencing is necessary while the other will declare that it has satisfied the obligation. Indeed, some will utilize this new obligation to seek discovery sanctions against a party that allegedly terminates the conference prematurely.

Critics agree, the current rule fails to provide uniformity. The proposed amendment perpetuates this void. Critics propose that the rule include a framework for the parties to address their objections and to resolve their objections before the depositions go forward. In addition, “a period of time, just like in Rule 45, to meet and confer and work it out, and if you don’t,

you have ten days to file an objection. So that when you go into the deposition, there is a ruling,” suggests McDaniel. “Because, as has been my experience, it’s all over the place with respect to what benefit a motion for a protective order brings. In my practice, more times than not they’re filed and I don’t have a ruling by the time of the deposition, so we go forward with it, sort of not knowing what the outcome is going be.”

We leave you with a parting sports analogy. In the past, the NFL had a rule where the clock would not stop when players were injured during the final two minutes of play. Later, the league changed the rule to promote player safety. The unintended consequence? Nearly 50% of all injuries occurred during the last two minutes of a football game. There are always those who take advantage of rule change, no matter how well-founded the change seems to be.

Assuming passage of the proposed amendments to Rule 30(b)(6), it remains to be seen how the rules committee will manage the unintended (yet predictable) consequences. Some may ponder if the better option is to leave 30(b)(6) alone.

The advisory committee’s public comment period for this round has closed.

The Standing Committee will review the findings and make a recommendation to the Supreme Court. It is incumbent upon us to continue advocating for changes that will benefit our clients – and even more so if the Court promulgates the proposed amendments. You may address your suggestions to RulesCommittee_Secretary@ao.uscourts.gov.

Keith McDaniel is a member of McCranie Sistrunk Anzelmo Hardy McDaniel & Welch and leads the firm’s catastrophic tort and product liability group. He represents clients in tort litigation across a spectrum of practice areas, including general liability, products liability, mass tort, life sciences, and toxic tort.

Kristen Burge is an associate with McCranie Sistrunk Anzelmo Hardy McDaniel & Welch. She holds an Intellectual Property LL.M. from University of Washington and a Neuroscience degree from Vanderbilt. She practices products liability, toxic tort, commercial litigation, and copyright and trademark law.

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The State of U.S. Immigration Law from I to V (ICE to Visas) Jennifer Parser

The state of United States immigration law is in the throes of tremendous change and under unprecedented stresses as an old system struggles to deal with today’s reality.

Mass migration is common and will only increase - the World Bank attributing 140 million people alone will migrate due to climate change by 2050 - and is seen today both by the professional seeking better career opportunities and the refugee grasping for personal security. This article will parse through recent news and focus on topics most relevant to employers and their counsel.

ICE Immigration and Customs Enforcement (ICE) has taken an increasingly aggressive stance toward illegal employment by seeking out and punishing the guilty employer. The law is clear: on the first day of hire for pay, an employee must choose from a list of acceptable documents

Poyner Spruill LLP

that prove identity and employment authorization and complete the first portion of Form I-9. The employer’s designated representative reviews the documentation and completes the rest of the form. If the employer is registered with E-Verify, the documents provided must include one with a photograph.

ICE can audit I-9s at any time by providing 72 hours’ notice of inspection (NOI). An internal yearly self-audit by the employer’s HR department is a prudent means to be sure the I-9s are compliant before an NOI arrives. From our experience, some employees show employment authorization documents (EADs) that necessarily expire, upon which their employment authorization ceases, unless steps have been taken to extend their status, often surprising both the employer and even the employee. An annual self-audit will keep both employer and employee aware of when the employee, assuming eligibility, should apply for a new EAD.

However, an unannounced raid by ICE can happen at any time and scoop up both the illegally hired employees and even independent contractors’ employees on the premises.

Why are authorized employment and accurate I-9s so important? First, it is the law, and second, the fines imposed by the U.S. Department of Homeland Security range from $375 to $16,000 per violation.

In 2017, Asplundh agreed to pay $95 million in fines for hiring unauthorized workers. The knowingly hiring of unauthorized workers can also include forfeiture of property and imprisonment of not just company owners but managers as well.

How common are NOIs? In the first half of 2018, 5,200 NOIs were delivered as part of a two-part nationwide operation. For the second phase, 2,738 NOIs were issued.

To place this in perspective, this represents a 400 percent increase in NOIs for fiscal year 2018. ICE has indicated it will continue

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its enforcement activities which recent news further corroborates.

California is the first state that introduced a law to sanction an employer for cooperating with ICE, thus placing an employer on the proverbial horns of a dilemma. California law AB 450, effective as of Jan. 1, 2018, prevented employers from responding to an ICE request for documents without a subpoena or judicial warrant and from permitting ICE agents physical access to nonpublic areas without a judicial warrant. It also required the employer to notify employees and any labor union if ICE is auditing the I-9 forms.

Fines range from $2,000 to $10,000 for an employer, while obeying federal law, fails to comply with AB 450. As a result, ICE announced plans to increase enforcement activities in California. However, Federal District Court Judge Mendez enjoined private sector employers from being prosecuted for allowing ICE to access nonpublic areas or voluntarily allowing the ICE agent access to employee records, upholding the pre-inspection notice to employees or his/ her collective bargaining representative and post-inspection notification of an affected employee.

There are no further developments as of the date of writing this article.

WORK VISAS

The H-1B visa is a common employer-sponsored temporary, and hence nonimmigrant, visa used to hire highly skilled workers in so-called “specialty occupations.” Specialty occupations are those which require the minimum of a U.S. bachelor’s degree or foreign equivalent. This visa is especially popular with IT companies that hire thousands of such workers, mainly from India and China. Entitled the Immigration Innovation Act of 2018 and introduced in September 2018, HR 6794 is a bill before Congress that primarily affects the H-1B visa with a long-term goal of increasing investment in STEM for U.S. students in K-12 and college. Homeland Security Secretary Kirstjen Nielson has also told the Senate Judiciary Committee considering the bill that another goal of the bill is that U.S. workers not be forced to train their H-1B replacements nor should foreign workers be exploited by being paid lower salaries.

If enacted, the law would remove the annual quota on holders of a U.S. master’s degree or higher, which is currently capped at 20,000 per year. The annual cap on bachelor’s degrees is 65,000. The proposed law creates an electronic registration requirement for employers seeking to file cap-sub-

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ject H-1B petitions, prioritizing foreigners with U.S. master’s degrees or higher and foreign Ph.Ds, followed by those holding U.S. STEM bachelor’s degrees. It also provides a grace period to allow H-1B visa holders to change jobs without losing status, regardless of whether termination of their employment was voluntary or involuntary.

Further, the bill would seek to protect U.S. workers by penalizing employers who have more than five H-1B employees who work under 25 percent of the time the first year of hire, and importantly, prohibits employers from hiring an H-1B worker to replace a U.S. worker. It also permits work authorization for spouses and dependent children of H-1B visa holders.

Finally, the bill would curtail the current harsh stance of the U.S. Citizenship and Immigration Services (USCIS) reviewing H-1B petitions and all extension petitions by the same employer. The USCIS has indicated that it will review such extension petitions de novo, and in September 2018 added the regulation that it can unilaterally approve or deny petitions without first issuing a request for more evidence, in essence removing from the employer a “second bite of the apple.” The new legislation would mercifully require approval of an extension unless there was a material error in the first petition, a substantial change in circumstances, or if material information is discovered that adversely impacts the eligibility of either the employer or employee.

Now a regulation, the Department of Homeland Security announced that effective in fiscal year 2020, employers seeking an H-1B visa must first electronically register all H-1B petitions with the USCIS during a specific registration period, counting all registrations toward the number allowed to reach the H-1B cap. Once a sufficient number are registered, the USCIS will first consider those holding advanced degrees, increasing the likelihood that most H-1B visas will in the future be awarded to the most skilled and highest paid positions.

It will decrease the chances of success for those with a U.S. bachelor’s or non-U.S. bachelor’s degree or foreign graduate degree. However, USCIS predicts that there will be a 16 percent increase in the number of U.S. graduate degree holders permitted to remain in the U.S. upon graduation.

PERMANENT U.S. RESIDENCE A/K/A “GREEN CARD” DEVELOPMENTS

The coveted “green card” entitles the holder to remain in the U.S. indefinitely, change jobs with no obligations on either the employer or prospective hire, other than completion of a Form I-9, and offers

the possibility of eventually applying for U.S. citizenship.

If enacted, HR 392 would eliminate the current per-country limits for employment-based green cards. The bill also exempts from per-country limits the spouses and children of employment-based green card holders, holders of U.S. STEM master’s degrees or higher, and extraordinary EB-1 green card holders. It would create a conditional green card for university-educated candidates by a process different from the onerous process of seeking to move an H-1B visa holder to green card status. A conditional green card would be issued if the employer can attest that no U.S. worker would be displaced thereby, that it first recruited U.S. workers for the position, and if it agrees to pay not less than a $100,000 per year in salary.

This bill is supported by Amazon, Deloitte LLP, Equifax, Inc., Hewlett Packard Enterprise, Microsoft Corp., IBM Corp., Salesforce.com and Texas Instruments, among others. In fact, its enactment would have a profound effect on skilled Chinese and Indian workers. The bipartisan Congressional Research Service, an independent research department of Congress, has determined that countries like China and India will dominate the green card market if per-country quotas are eliminated. For example, with a 7 percent per country quota, the backlog is currently at almost 10 years for Indians, with 306,601 waiting in line for green cards as of April 2018.

CONCLUSION

While Congress has recognized the urgent need for changes in our immigration law, the likelihood of continued gridlock over our southern border may well delay or prevent any significant changes that will help employers to retain or hire foreign talent. But meanwhile, ICE is aggressively on the move to ensure that employers have a legal workforce.

Jennifer Parser serves as Of Counsel in Poyner Spruill LLP’s Raleigh, North Carolina, office. Her practice includes a broad range of immigration and labor and employment matters. She is a multi-lingual attorney who advises on I-9 compliance, oversees and responds to issues relating to employer-generated audits, and assists with Immigration and Custom Enforcement issues.

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on the move

Georgia Staton of Jones, Skelton & Hochuli, PLC (JSH) has been appointed chair of the American College of Trial Lawyers (ACTL) Arizona State Committee. She has been an ACTL Fellow since 2010, and previously served as vice chair. The ACTL is an invitation-only fellowship of exceptional trial lawyers who demonstrate the very highest standards of trial advocacy. Membership in the ACTL does not exceed 1% of the total lawyer population of any state or province.

Stephen Bullington of Jones, Skelton & Hochuli, PLC (JSH) has been elected into the American Board of Trial Advocates (ABOTA).

He is the 10th JSH attorney to earn this distinction, and joins colleagues James Curran, James Evans, William Holm, John Masterson, Donald Myles, Russell Skelton, Phillip Stanfield, Georgia Staton and Mark Zukowski. ABOTA is a national association of experienced trial lawyers and judges. ABOTA and its members are dedicated to the preservation and promotion of the civil jury trial right provided by the Seventh Amendment to our United States Constitution.

The Poyner Spruill team of Drew Erteschik, Saad Gul, J.M. Durnovich, and Cosmo Zinkow had their certiorari petition on behalf of the N.C. Department of Revenue granted by the U.S. Supreme Court.

Martha Svoboda, of counsel at Poyner Spruill LLP in Raleigh, North Carolina, passed the ACAMS exam (The Association of Certified Anti-Money Laundering Specialists) and is now a Certified Anti-Money Laundering Specialist (CAMS).

Thomas G. Williams, a managing member of Quattlebaum, Grooms & Tull PLLC in Arkansas, was inducted as a Member of the American Board of Trial Advocates (ABOTA) during the 2018 Annual Meeting of the Arkansas Chapter held in Chicago, Illinois.

Founded in 1958, ABOTA is a national association of experienced trial lawyers and judges dedicated to the preservation and promotion of the civil jury trial right provided by the Seventh Amendment to the U.S. Constitution.

Joseph W. Price II, a member of Quattlebaum, Grooms & Tull PLLC, has been appointed DRI state membership chair for Arkansas. As state membership chair, he is responsible for membership recruitment, retention, and engagement on behalf of DRI within Arkansas. DRI is the largest international membership organization of attorneys defending the interests of business and individuals in civil litigation.

Rivkin Radler LLP in Uniondale, New York, recently launched the electronic news bulletin Rivkin Rounds. Subtitled, “Your prescribed dose of health law news,” Rivkin Rounds was created for businesses, professionals, investors and stakeholders in the healthcare industry.

The bulletin presents brief articles with links to primary sources, covering such items as developments in regulations and laws affecting the healthcare industry and related health insurance market, and important cases and regulatory proceedings. It also features news from related areas affecting healthcare organizations, including changes in employment and tax laws. Rivkin Rounds contributors include members of the Health Services Practice Group, and the bulletin is edited by Health Services Partner Eric D. Fader. (https:// www.rivkinradler.com/rivkin-rounds/) SmithAmundsen was recognized by the Chicagoland Associated General Contractors (AGC) as a longstanding member since 2008.

The Chicagoland AGC is the leading trade association serving the Chicagoland commercial construction industry.

SmithAmundsen’s Moses Suarez was elected president of the Lesbian and Gay Bar Association of Chicago (LAGBAC). Moses has served as vice president of LAGBAC since 2015 and on its board of directors since 2010. He is a partner in the firm’s Chicago office where he concentrates his practice in medical malpractice litigation and health care compliance.

Gary Zhao, a partner at SmithAmundsen in Chicago, Illinois, was elected treasurer of the National Asian Pacific American Bar Association.

Erin Nathan has been elected to the Iowa State Bar Association Board of Governors for District 6. Erin is one of five representatives from District 6, and has been selected to help represent Linn County. She is a member of Simmons Perrine Moyer Bergman PLC where she practices in the firm’s Labor & Employment Law practice group.

Paul Morf of Simmons Perrine Moyer Bergman PLC has been elected president by the Board of Directors of the Iowa Academy of Trust and Estate Counsel (IATEC). Paul has served as IATEC’s vice president since it was established in 2012. Membership to IATEC is by invitation only and is limited to 250 Iowa attorneys. The group exists to “foster cooperation and collective discussion” within the Iowa trust and estate planning bar and to “educate and support legislative efforts and initiatives for facilitating effective transmission of wealth and values of Iowa families.”

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Joining volunteers around the world, Flaherty Sensabaugh Bonasso PLLC attorneys took part in the inaugural Global Day of Service, a worldwide initiative spearheaded by Ford Motor Company’s Legal Alliance for Women (LAW), the company’s professional organization focused of women in the legal practice.

“We are proud to partner with Ford on this day of service. Manna Meal is an organization that we have supported for many years, so we naturally gave them a call to see how we could help,” said Tyler Dinsmore, assistant managing member at Flaherty in Charleston, West Virginia. “Manna Meal serves the hungry in our community every day, no questions asked. It is an honor to play a small part in giving back and helping to further their mission.”

Alan S. Rutkin of Rivkin Radler LLP in Uniondale, New York, received the 2018 John Alan Appleman Award from the Federation of Defense & Corporate Counsel (FDCC). The award recognizes the Substantive Law Section Chair who has made the most outstanding contribution to the advancement of the FDCC’s educational goals through the work of his or her Section.

Jones, Skelton & Hochuli, P.L.C. (JSH) in Phoenix, Arizona, sponsored the third annual Phoenix Children’s Hospital 5k in downtown Phoenix. A total of 49 JSH employees, friends and family members (plus a few four-legged friends) participated in the event to show support of PCH’s efforts to serve the community. A record-breaking 2,000 walkers, runners and kids participated in the event, raising a total of $313,000 for the PCH Foundation. All proceeds from the 5K support more than 60 of the hospital’s programs and services funded solely or significantly through philanthropy.

In preparation for the 2018-2019 school year, the Jones, Skelton & Hochuli, P.L.C. (JSH) Charity Committee stocked the “lending closets” at Mitchell Elementary School with $2,000 worth of back-to-school clothing and toiletries. The school serves more than 550 students in pre-K through 5th grade. Thanks to the very generous donations from JSH employees, the Charity Committee donated two truck-loads of essentials, including: 63 uniform polos; 78 skorts, pants and shorts; 49 pairs of sneakers; 346 pairs of socks and under garments; and 185 essential toiletries such as toothpaste, toothbrush, shampoo, soap, deodorant, combs, hand sanitizer and baby wipes.

of USLAW Elizabeth “Betsy” Burgess, a shareholder in the Tallahassee, Florida, office of Carr Allison, was the honoree of Cards for a Cure, Tallahassee’s annual fall event that honors a local member of the Tallahassee (Florida) community who has shown courage and valor in their fight against breast cancer. The event benefits the Tallahassee Memorial Cancer Center & Cancer Programs. Carr Allison sponsored, Betsy delivered a heartfelt speech, more than 600 people attended and the event raised important funding for cancer support programs. To learn more about Betsy’s story, visit https://vimeo. com/293440066/867f3f0248.

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Poyner Spruill partner and former congressman Mike McIntyre will be honored with the Distinguished Alumni Award at the UNC School of Law Alumni Association’s Annual Law Leadership and Awards Dinner in Chapel Hill on May 3. The Distinguished Alumni Award is given each year to a UNC School of Law graduate whose accomplishments and contributions have enhanced the school and the profession of law at the local, state, national or international level.

Jared Cohane and Peter J. Martin of Hinckley Allen in Hartford, Connecticut, are recipients of the Minority Construction Council Training Alliance Award. The award was presented at the Construction Expo and Matchmaker event, and given to individuals who assist the Minority Construction Council (MCC) in educating Minority Business Enterprise (MBEs) contractors in the areas of safety, contract administration, contractor development, and contract law. The MCC is dedicated to advancing the cause of minority contracts and workers.

Whether an established business, new business, a developer seeking qualified workforce, construction worker or skilled laborer, the MCC provides advocacy, training seminars, education, and contractor networking.

Wicker, Smith, O’Hara, McCoy & Ford, P.A, (Jacksonville, FL) participated in the Jacksonville Bar Association, Young Lawyers Section annual Charity Chili Cook-Off with to help raise money for Best Buddies, a nonprofit organization dedicated to ending the social, physical, and economic isolation of the 200 million people with intellectual and developmental disabilities. The attorneys at Wicker Smith joined 48 other local law firms who competed and raised money in this annual event to support a worthy cause. Pictured front: Holly Howanitz, back l-r: Adam Remillard, Chris Koutnik, Tara Floyd, and Eric Whitaker.

Rivkin Radler’s Evan Krinick was the honoree of Mentor New York’s 22nd Annual Benefit that raised nearly $150,000 to support mentoring programs in New York. Evan was one of the first Leadership Council members for Mentor New York, where he served on numerous committees and ultimately was elected a co-chair. Photo: Evan H. Krinick (4th from right) is Rivkin Radler’s Managing Partner.

Joe Price of Dysart Taylor Cotter McMonigle & Montemore, P.C. in Kansas City, Missouri, was inducted into the Hall of Fame of the Estate Planning Society of Kansas City (EPS). He is only the ninth attorney, and the youngest, to ever be inducted into the Hall of Fame. The EPS was established in 1965 and is the principal estate planning organization in the region.

Cheslie Kryst, an associate at Poyner Spruill’s Charlotte, North Carolina, office was crowned Miss North Carolina USA and will be competing for the title of Miss USA this summer.

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RECENT USLAW LAW FIRM VERDICTS Flaherty Sensabaugh Bonasso PLLC (Charleston, WV) The United States District Court for the Southern District of West Virginia granted summary judgment in favor of the defendants, CBS Broadcasting, CBS News, reporter Jim Axelrod, anchor Scott Pelley, and producer Ashley Velie, in a lawsuit alleging defamation and false light invasion of privacy arising out of CBS News’ Peabody Award-winning series on the opioid crisis in West Virginia, ruling that the plaintiff had failed to establish that the defendants’ alleged defamatory statements were false. In a 41-page published opinion filed on August 21, 2018, the federal court further ruled for the defendants on the plaintiff’s claims of tortious interference and intentional infliction of emotional distress claims, concluding that the challenged broadcasts “were not only tolerable – they were applaudable.” Thomas V. Flaherty teamed with Ballard Spahr attorneys Michael D. Sullivan, Jay Ward Brown, and Maxwell S. Mishkin to obtain the result.

Jones, Skelton & Hochuli (Phoenix, AZ) Michele Molinario and Jon Barnes of Jones, Skelton & Hochuli in Phoenix, Arizona, obtained a successful outcome in Arizona Court Of Appeals. In Dyer v. City of Yuma (Dyer II), the Arizona Court of Appeals affirmed a judgment upholding Officer Dyer’s termination. The City of Yuma terminated Dyer based on violations of police department policy, and Dyer appealed to the City’s merit board, which recommended Dyer’s reinstatement. The City Administrator rejected that recommendation and upheld Dyer’s termination, but without specifying any findings required by the governing statute. Dyer sued the City claiming, inter alia, the City was required to reinstate her pursuant to the merit board’s recommendation. The trial court dismissed Dyer’s complaint and upheld the City Administrator’s decision. But the Court of Appeals in Dyer I remanded based on the City Administrator’s failure to specify the statutorily required findings. On remand, the City Administrator upheld Dyer’s termination and set forth detailed findings in support of his decision. The trial court then entered judgment, finding that the mandate from Dyer I was satisfied, which the Court of Appeals in Dyer II affirmed.

Murchison & Cumming LLP (Los Angeles, CA) Richard C. Moreno and Gina E. Och secured a victory for their client, a hotel with a golf course on its property, who was sued by adjacent property owners and insurers affected by the Poinsettia Fire.

In 2014, a fire originated on a hotel’s golf course and spread to properties beyond the hotel and golf course. The plaintiffs sued the hotel for negligence, trespass, and nuisance. The hotel moved for summary judgment on the elements of duty and causation and argued that the it owed no duty to the other property owners to minimize fire hazards by restricting smoking and maintaining the native vegetation on the golf course, and the hotel’s conduct was not the cause of their damages. The trial court granted the summary judgment motion. A subrogation plaintiff appealed.

Recently, the California Court of Appeals affirmed the trial court’s decision. Without deciding the issue of duty, the appellate court concluded that the hotel met its burden on summary judgment of showing the plaintiff could not establish the causation element of its claims.

The plaintiff offered several theories on the element of causation however, all fire cause and origin investigators, including the Fire Department’s fire investigator and the plaintiff’s own experts, agreed the cause of the fire was undetermined. The plaintiff also argued the hotel caused its damages by failing to adequately irrigate and maintain the native areas at or surrounding the golf course. However, the plaintiff’s fire fuels management expert conceded that, had the hotel done everything the expert recommended to maintain the native areas, there was a high likelihood a lit cigarette dropped in the same area under the same conditions would have still caused a fire to start and spread.

For these reasons, the Court of Appeal affirmed summary judgment in favor of the hotel.

Pierce Couch Hendrickson Baysinger & Green, LLP (Oklahoma City, OK) Mark E. Hardin, partner at Pierce Couch Hendrickson Baysinger & Green, LLP, recently obtained a successful jury verdict in favor of a large national bank. The bank sought to foreclose on a residential mortgage and the borrower filed counterclaims for: 1) breach of contract; 2) violations of RESPA; 3) violations of the Oklahoma Consumer Protection Act: 4) violations of the FDCPA; 5) emotional distress; 6) violations of TILA; 7) negligence; 8) fraud; 9) defamation; and 10) invasion of privacy. Mr. Hardin was successful in eliminating nine of the Defendant’s 10 counterclaims during pretrial motions. The case proceeded to a three-day jury trial on the bank’s foreclosure claim and the Defendant’s breach of contract counterclaim. Despite testimony from Defendant’s expert witness that the bank misapplied payments and maintained unreliable records, the jury returned a unanimous verdict in favor of the bank and awarded it the full amount it had requested.

Rivkin Radler LLP (Uniondale, NY) Rivkin Radler partners Michael C. Cannata, Stephen J. Smirti Jr. and Stuart I. Gordon filed an amicus brief with the U.S. Supreme Court on behalf of the New York Intellectual Property Law Association in a case styled Mission Product Holdings, Inc. v.

Tempnology, LLC. The case concerns the rights of a trademark licensee to continue to use a trademark after a licensor declares bankruptcy and rejects the license agreement.

The case is currently before the Supreme Court based on a circuit split; the First Circuit concluding that a debtor-licensor’s rejection of a trademark license terminates a licensee’s right to use a trademark and, conversely, the Seventh Circuit concluding that under such circumstances, a trademark licensee’s rights were not extinguished. If the position that was advanced in the amicus brief is

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successful, consistent with the Seventh Circuit, a licensee can continue to use a trademark even after the licensor files bankruptcy.

The brief argued several points, including: (1) that a plain construction of Section 365 of the Bankruptcy Code demonstrates that the rejection of a trademark license by a debtor-licensor should be treated only as a breach of the license, not as a termination of the license; (2) if the rights that have been granted to a licensee in a license agreement rise to the level of a property interest, such interest cannot be divested by operation of bankruptcy law and the license agreement cannot be terminated; and (3) the quality control requirements of trademark licensing law do not preclude a licensee’s continued use of a trademark after rejection.

SmithAmundsen (Chicago, IL) SmithAmundsen’s Jeff Risch and Mike Hughes successfully represented two separate franchise owners against union organizing petitions filed by a Chicago-based Teamsters local union under the NLRB’s “Ambush Election” Rule, where the vote count initially appeared unanimously for the union. After careful strategic planning under a “joint employer” analysis under the NLRA, both franchises were combined into one unit for the final vote, which ultimately resulted in the union being voted down.

Sweeney & Sheehan, P.C. (Philadelphia, PA) J. Michael Kunsch of Sweeney & Sheehan in Philadelphia obtained summary judgment in the Eastern District of Pennsylvania following a successful Daubert challenge of plaintiffs’ liability expert in a product liability case. Plaintiffs asserted claims of strict liability, negligence and breach of warranty against the manufacturer and seller of a fiberglass stepladder. The husband-plaintiff fell off the ladder in the master bathroom of his home while

painting a skylight. He had positioned the ladder on a tarp, and claimed the ladder feet slipped and caused his fall. The ladder contained a warning to “Set all four feet on a firm level surface.

Do not place on unstable, loose or slippery surfaces.” Despite the presence of that warning, plaintiffs’ engineering expert opined that the ladder should have had a specific warning about the danger of the ladder slipping when placed on a tarp on a smooth tile surface. The Court found the expert’s opinion did not satisfy the Daubert reliability and fit requirements, noting that he made no inspections of the ladder or scene, performed no tests, cited no relevant industry standards, offered inconsistent opinions, and simply accepted plaintiff’s testimony about how the accident happened. After precluding the expert, the Court further found that no reasonable jury could conclude that the ladder was defective and entered summary judgment.

Williams Kastner (Seattle, WA) Dan Brown and Adam Rosenberg of Williams Kastner in Seattle represented Northwest Motorsports (NWMS) in its claims against Sunset Chevrolet revolving around a predicate agreement breached by Sunset where it promised not to utilize NWMS’s trademark phrases and catch phrases in Sunset’s advertising, as well as its attempts at unfairly soliciting away NWMS’s employees.

This was an incredibly contentious litigation with Sunset filing (and losing) six dispositive motions and hundreds of pleadings being filed. Earlier in the case, Sunset was sanctioned $75,000 for hiding documents and interfering in third party discovery – which we believe is the largest sanction the judge in Pierce County has ever handed down. Williams Kastner successfully obtained a permanent injunction against Sunset’s actions and obtained a judgement on NWMS’s damage request for the breach of contract which, including interest and fees, exceeds $1.8 million.

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RECENT USLAW LAW FIRM transactions Hinckley Allen (Hartford, CT) Hinckley Allen is representing First Connecticut Bancorp, Inc. (NASDAQ: FBNK), the holding company for Farmington Bank, in connection with First Connecticut Bancorp’s acquisition by People’s United Financial, Inc. (NASDAQ: PBCT), the holding company for People’s United Bank, N.A., in an all-stock transaction valued at approximately $544 million. Completion of the transaction is subject to customary closing conditions, including receipt of regulatory approvals and the approval of First Connecticut Bancorp, Inc. shareholders.

Farmington Bank is a full-service community bank with 28 branch locations throughout Central Connecticut and Western Massachusetts, offering commercial and retail banking as well as wealth management services.

People’s United Bank, founded in 1842, is a premier, community-based, regional bank in the Northeast offering commercial and retail banking, as well as wealth management services through a network of nearly 400 retail locations in Connecticut, New York, Massachusetts, Vermont, New Hampshire and Maine.

Rivkin Radler LLP (Uniondale, NY) Rivkin Radler LLP advised Northwell Health, Northwell Health, the largest integrated health system in New York, on its $100 million acquisition of Orlin & Cohen, a leading private orthopaedic practice in Long Island, New York, with eight offices and 35 physicians.

The Rivkin team worked on all the transactional, regulatory, and compliance aspects of the deal, which signed in October 2017 and closed in January 2018.

The partnership between Orlin & Cohen and Northwell expands the health system’s presence in the south shore of Nassau County and complements inpatient services that Northwell offers at 12 hospitals on Long Island.

Orlin & Cohen has 80 providers on staff at eight Long Island locations, with 35 physicians specializing in sports medicine and total joint replacement. All of Orlin & Cohen’s 500 employees will move over to Northwell.

Rivkin Radler is a regular advisor to Northwell Health, a major not-for-profit healthcare network that includes 20 hospitals, and numerous other healthcare facilities. With around 60,000 employees, it is the largest private employer in New York state.

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Hall Booth Smith, P.C. (Atlanta, GA) In 2007, Justin Kerenyi, a partner at Hall Booth Smith in Atlanta, was one of four board members who founded the Atlanta-based non-profit Songs For Kids Foundation. Songs For Kids (SFK) gives kids battling serious illness the opportunity to express themselves through music, both in and out of children’s hospitals. Musical artists working with SFK engage and inspire kids and their families through live concerts, bedside performances, music mentorships, and songwriting and recording programs. By uplifting anxious families and transforming kids struggling with medical hardship into rock stars, the non-profit provides those in need a positive outlet to communicate their feelings, fears and triumphs through songs and music.

“It’s been a privilege to participate in the creation and growth of a successful charitable foundation and I’m honored to have the opportunity to contribute through pro-bono legal work as well as other services,” says Kerenyi, who serves as Songs for Kids’ secretary and general counsel. “I’m also thankful for the generous support from Hall Booth Smith. It’s humbling to see a “labor of love” side-project proudly supported by my firm and colleagues and I’m ever grateful for the support.”

Now in its 12th year, the continued enthusiasm for the musical services has allowed SFK to grow well beyond Atlanta. In 2013, SFK completed a nationwide tour visiting all 200 children’s hospitals in the continental U.S. SFK currently provides regular music programs annually in five states; totaling more than 1,000 music sessions a year. Recently, SFK announced the opening of a facility in Atlanta, The Songs For Kids Center. The Center has a state-of-the-art recording studio and stage where kids of all ages and abilities can write, record and perform music as well as receive weekly musical instruction with SFK mentors.

To learn more about Songs For Kids, visit www.songsforkids.org.

Lashly & Baer, P.C. (St. Louis, MO) Lashly & Baer, P.C. in St. Louis, Missouri, received an Award of Achievement for its participation in the 2018 Honorable Richard B. Teitelman Memorial St. Louis Pro Bono Challenge sponsored by the Bar Association of Metropolitan St. Louis and Legal Services of Eastern Missouri. The firm increased its pro bono hours by 38% in 2018 and strives to increase its participation in both attorney count and hours in 2019.

Attorney Julie Z. Devine manages the program for the firm.

Kelly Santini LLP (Ontario, Canada) Kelly Santini LLP has been a huge proponent of the legal services offered by Pro Bono Ontario. Kelly Santini lawyers have actively been volunteering their time for years to assist at the Ottawa Pro Bono office by providing legal assistance to the vulnerable in their society who do not have the financial means to retain counsel. In December 2018, Mitch Kitagawa and Lisa Langevin, partners at Kelly Santini, were requested by the Ottawa judiciary to act as amicus curiae counsel to a self-represented individual just a couple days before a jury trial was scheduled to begin.

An amicus curiae (literally, “friend of the court”) is someone who is not a party to a case and may or may not have been solicited by a party and who assists a court by offering information, expertise, or insight that has a bearing on the issues in the case.

The case involved an individual injured in a motor vehicle accident who sued the at-fault driver and his insurer for accident benefits.

Typically, insurance defense counsel, Mitch and Lisa were pleased to accept the appointment as amicus counsel by the trial judge in order to assist the court during the trial to ensure that the plaintiff was provided appropriate legal support. The role was at times challenging given that amicus counsel cannot fully advocate for the plaintiff but rather act as a friend of the court by guiding the plaintiff through the trial to ensure the matter ran as efficiently as possible and the process was fair for the plaintiff given that both defendants were represented by counsel. Mitch and Lisa’s involvement saved a lot of valuable court time and expense. In the end, the judge found in favor of the plaintiff and nominal damages were awarded for generals, housekeeping and loss of income (Mame v. Victorin 2018 ONSC 7477).

Rivkin Radler LLP (Uniondale, NY) The Nassau County Bar Association (NCBA), The Safe Center LI (TSCLI) and Nassau Suffolk Law Services (NSLS) have named Rivkin Radler a top law firm in pro bono service for 2017. This is the fourth consecutive year the firm has been recognized.

The annual award, which ranks law firms by categories based on size, also ranks firms within their peer group based on the total number of pro bono service hours.

Sixteen of the firm’s attorneys received recognition, including Brian L. Bank, Michelle A. Bholan, William Cornachio, Ryan Goldberg, Jeffrey S. Greener, Ada Kozicz, Matthew A. Lampert, Sean McAloon, Frank M. Misiti, Jason M. Romeo, Alan S. Rutkin, Jonathan Salm, Brian S. Schlosser, Matthew V. Spero, Frank A. Valverde and John J. Vobis Jr.

USLAW

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a bout

uslaw network 2001. The Start of Something Better.

Mega-firms...big, impersonal bastions of legal tradition, encumbered by bureaucracy and often slow to react. The need for an alternative was obvious. A vision of a network of smaller, regionally based, independent firms with the capability to respond quickly, efficiently and economically to client needs from Atlantic City to Pacific Grove was born. In its infancy, it was little more than a possibility, discussed around a small table and dreamed about by a handful of visionaries. But the idea proved too good to leave on the drawing board. Instead, with the support of some of the country’s brightest legal minds, USLAW NETWORK became a reality.

Fast-forward to today.

The commitment remains the same as originally envisioned. To provide the highest quality legal representation and seamless cross-jurisdictional service to major corporations, insurance carriers, and to both large and small businesses alike, through a network of professional, innovative law firms dedicated to their client’s legal success. Now as a diverse network with more than 6,000 attorneys from more than 60 independent, full practice firms with roots in civil litigation across the U.S., Canada, Latin America and Asia, and with affiliations with TELFA in Europe, USLAW NETWORK remains a responsive, agile legal alternative to the mega-firms.

Home Field Advantage.

USLAW NETWORK offers what it calls The Home Field Advantage which comes from knowing and understanding the venue in a way that allows a competitive advantage – a truism in both sports and business.

Jurisdictional awareness is a key ingredient to successfully operating throughout the United States and abroad. Knowing the local rules, the judge, and the local business and legal environment provides our firms’ clients this advantage. The strength and power of an international presence combined with the understanding of a respected local firm makes for a winning line-up.

A Legal Network for Purchasers of Legal Services.

USLAW NETWORK firms go way beyond providing quality legal services to their clients. Unlike other legal networks, USLAW is organized around client expectations, not around the member law firms. Clients receive ongoing educational opportunities, online resources including webinars,

jurisdictional updates, and resource libraries. We also provide a semi-annual USLAW Magazine, USLAW DigiKnow, which features insights into today’s trending legal topics, compendiums of law, as well as annual membership directory. To ensure our goals are the same as the clients our member firms serve, our Client Leadership Council and Practice Group Client Advisors are directly involved in the development of our programs and services. This communication pipeline is vital to our success and allows us to better monitor and meet client needs and expectations.

USLAW Abroad.

Just as legal issues seldom follow state borders, they often extend beyond U.S. boundaries as well. In 2007, USLAW established a relationship with the TransEuropean Law Firms Alliance (TELFA), a network of more than 20 independent law firms representing more than 1000 lawyers through Europe to further our service and reach.

How USLAW NETWORK Membership is Determined.

Firms are admitted to the NETWORK by invitation only and only after they are fully vetted through a rigorous review process.

Many firms have been reviewed over the years, but only a small percentage were eventually invited to join. The search for quality member firms is a continuous and ongoing effort. Firms admitted must possess broad commercial legal capabilities and have substantial litigation and trial experience. In addition, USLAW NETWORK members must subscribe to a high level of service standards and are continuously evaluated to ensure these standards of quality and expertise are met.

USLAW in Review.

• All vetted firms with demonstrated, robust practices and specialties • Efficient use of legal budgets, providing maximum return on legal services investments • Seamless, cross-jurisdictional service • Responsive and flexible • Multitude of educational opportunities and online resources • Team approach to legal services The USLAW Success Story.

The reality of our success is simple: we succeed because our member firms’ clients succeed. Our member firms provide high-quality legal results through the efficient use of legal budgets. We provide cross-jurisdictional services eliminating the time and expense of securing adequate representation in different regions. We provide trusted and experienced specialists quickly.

When a difficult legal matter emerges – whether it’s in a single jurisdiction, nationwide or internationally – USLAW is there.

Success.

For more information, please contact Roger M. Yaffe, USLAW CEO, at (800) 231-9110 or roger@uslaw.org

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Calgary, AB Edmonton, AB

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membership roster ALABAMA | BIRMINGHAM Carr Allison Charles F. Carr......................(251) 626-9340 ccarr@carrallison.com

ILLINOIS | CHICAGO SmithAmundsen LLC Lew R.C. Bricker....................(312) 894-3224 lbricker@salawus.com

NEW MEXICO | ALBUQUERQUE Modrall Sperling Jennifer G. Anderson............(505) 848-1809 Jennifer.Anderson@modrall.com

UTAH | SALT LAKE CITY Strong & Hanni, PC Stephen J. Trayner................(801) 323-2011 strayner@strongandhanni.com

ALASKA | ANCHORAGE Richmond & Quinn Robert L. Richmond.............(907) 276-5727 brichmond@richmondquinn.com

INDIANA | INDIANAPOLIS Bingham Greenebaum Doll LLP James M. Hinshaw................(317) 968-5385 jhinshaw@bgdlegal.com

VIRGINIA | RICHMOND LeClairRyan C. Erik Gustafson..................(703) 647-5902 egustafson@leclairryan.com

ARIZONA | PHOENIX Jones, Skelton & Hochuli, P.L.C. Phillip H. Stanfield...............(602) 263-1745 pstanfield@jshfirm.com

IOWA | CEDAR RAPIDS Simmons Perrine Moyer Bergman PLC Kevin J. Visser........................(319) 366-7641 kvisser@spmblaw.com

NEW YORK | HAWTHORNE Traub Lieberman Straus & Shrewsberry LLP Stephen D. Straus................. (914) 586-7005 sstraus@tlsslaw.com

ARKANSAS | LITTLE ROCK Quattlebaum, Grooms & Tull PLLC John E. Tull, III......................(501) 379-1705 jtull@qgtlaw.com

KANSAS/WESTERN MISSOURI | KANSAS CITY Dysart Taylor Cotter McMonigle & Montemore, PC Patrick K. McMonigle...........(816) 714-3039 pmcmonigle@dysarttaylor.com

CALIFORNIA | LOS ANGELES Murchison & Cumming LLP Dan L. Longo.........................(714) 953-2244 dlongo@murchisonlaw.com CALIFORNIA | SAN DIEGO Klinedinst PC John D. Klinedinst................(619) 239-8131 jklinedinst@klinedinstlaw.com CALIFORNIA | SAN FRANCISCO Hanson Bridgett LLP Mert A. Howard....................(415) 995-5033 mhoward@hansonbridgett.com CALIFORNIA | SANTA BARBARA Snyder Burnett Egerer, LLP Barry Clifford Snyder............(805) 683-7750 bsnyder@snyderlaw.com COLORADO | DENVER Lewis Roca Rothgerber Christie LLP Michael D. Plachy.................(303) 628-9532 MPlachy@lrrc.com CONNECTICUT | HARTFORD Hinckley Allen Noble F. Allen.......................(860) 725-6237 nallen@hinckleyallen.com

KENTUCKY | LOUISVILLE Bingham Greenebaum Doll LLP Mark S. Riddle.......................(502) 587-3623 mriddle@bgdlegal.com LOUISIANA | NEW ORLEANS McCranie, Sistrunk, Anzelmo, Hardy McDaniel & Welch LLC Michael R. Sistrunk..............(504) 846-8338 msistrunk@mcsalaw.com MAINE | PORTLAND Richardson, Whitman, Large & Badger Elizabeth G. Stouder.............(207) 774-7474 estouder@rwlb.com MARYLAND | BALTIMORE Franklin & Prokopik, PC Albert B. Randall, Jr..............(410) 230-3622 arandall@fandpnet.com MINNESOTA | ST. PAUL Larson • King, LLP Mark A. Solheim...................(651) 312-6503 msolheim@larsonking.com

NEW YORK | UNIONDALE Rivkin Radler LLP Evan H. Krinick.....................(516) 357-3483 evan.krinick@rivkin.com NORTH CAROLINA | RALEIGH Poyner Spruill LLP Deborah E. Sperati...............(252) 972-7095 dsperati@poynerspruill.com NORTH DAKOTA | DICKINSON Ebeltoft . Sickler . Lawyers PLLC Randall N. Sickler.................(701) 225-5297 rsickler@ndlaw.com OHIO | CLEVELAND Roetzel & Andress Bradley A. Wright..................(330) 849-6629 bwright@ralaw.com OKLAHOMA | OKLAHOMA CITY Pierce Couch Hendrickson Baysinger & Green, L.L.P. Gerald P. Green.....................(405) 552-5271 jgreen@piercecouch.com OREGON | PORTLAND Williams Kastner Greene & Markley Thomas A. Ped......................(503) 944-6988 tped@williamskastner.com PENNSYLVANIA | PHILADELPHIA Sweeney & Sheehan, P.C. J. Michael Kunsch.................(215) 963-2481 michael.kunsch@sweeneyfirm.com

MISSISSIPPI | GULFPORT Carr Allison Douglas Bagwell...................(228) 864-1060 dbagwell@carrallison.com

PENNSYLVANIA | PITTSBURGH Pion, Nerone, Girman, Winslow & Smith, P.C. John T. Pion..........................(412) 281-2288 jpion@pionlaw.com

MISSISSIPPI | RIDGELAND Copeland, Cook, Taylor & Bush, P.A. James R. Moore, Jr................(601) 427-1301 jmoore@cctb.com

RHODE ISLAND | PROVIDENCE Adler Pollock & Sheehan P.C. Richard R. Beretta, Jr............(401) 427-6228 rberetta@apslaw.com

MISSOURI | ST. LOUIS Lashly & Baer, P.C. Stephen L. Beimdiek............(314) 436-8303 sbeim@lashlybaer.com

SOUTH CAROLINA | COLUMBIA Sweeny, Wingate & Barrow, P.A. Mark S. Barrow.....................(803) 256-2233 msb@swblaw.com

MONTANA | GREAT FALLS Davis, Hatley, Haffeman & Tighe, P.C. Maxon R. Davis.....................(406) 761-5243 max.davis@dhhtlaw.com

SOUTH DAKOTA | PIERRE Riter, Rogers, Wattier & Northrup, LLP Robert C. Riter......................(605) 224-5825 r.riter@riterlaw.com

NEBRASKA | OMAHA Baird Holm LLP Jill Robb Ackerman...............(402) 636-8263 jrackerman@bairdholm.com

TENNESSEE | MEMPHIS Martin, Tate, Morrow & Marston, P.C. Lee L. Piovarcy......................(901) 522-9000 lpiovarcy@martintate.com

HAWAII | HONOLULU Goodsill Anderson Quinn & Stifel LLP Edmund K. Saffery................(808) 547-5736 esaffery@goodsill.com

NEVADA | LAS VEGAS Thorndal Armstrong Delk Balkenbush & Eisinger Brian K. Terry........................(702) 366-0622 bkt@thorndal.com

TEXAS | DALLAS Fee, Smith, Sharp & Vitullo, L.L.P. Michael P. Sharp...................(972) 980-3255 msharp@feesmith.com

IDAHO | BOISE Duke Scanlan & Hall, PLLC Richard E. Hall......................(208) 342-3310 reh@dukescanlan.com

NEW JERSEY | ROSELAND Connell Foley LLP Kevin R. Gardner..................(973) 840-2415 kgardner@connellfoley.com

DELAWARE | WILMINGTON Cooch and Taylor P.A. James W. Semple..................(302) 984-3842 jsemple@coochtaylor.com FLORIDA | CENTRAL FLORIDA Wicker Smith O’Hara McCoy & Ford P.A. Richards H. Ford...................(407) 843-3939 rford@wickersmith.com FLORIDA | SOUTH FLORIDA Wicker Smith O’Hara McCoy & Ford P.A. Nicholas E. Christin..............(305) 448-3939 nchristin@wickersmith.com FLORIDA | TALLAHASSEE Carr Allison Christopher Barkas...............(850) 222-2107 cbarkas@carrallison.com GEORGIA | ATLANTA Hall Booth Smith, P.C. John E. Hall, Jr.......................(404) 954-5000 jeh@hallboothsmith.com

TEXAS | HOUSTON MehaffyWeber Barbara J. Barron..................(512) 394-3840 BarbaraBarron@mehaffyweber.com

WASHINGTON | SEATTLE Williams Kastner Sheryl J. Willert.....................(206) 628-2408 swillert@williamskastner.com WEST VIRGINIA | CHARLESTON Flaherty Sensabaugh Bonasso PLLC Andrew B. Cooke..................(304) 347-4274 acooke@flahertylegal.com WYOMING | CASPER Williams, Porter, Day and Neville PC Scott E. Ortiz.........................(307) 265-0700 sortiz@wpdn.net

USLAW INTERNATIONAL BRAZIL | SÃO PAULO Mundie e Advogados Rodolpho Protasio...........(55 11) 3040-2923 rofp@mundie.com CANADA | ALBERTA CALGARY & EDMONTON Parlee McLaws LLP Connor Glynn.......................(780) 423-8639 cglynn@parlee.com CANADA | ONTARIO | OTTAWA Kelly Santini Lisa Langevin...........(613) 238-6321 ext 276 llangevin@kellysantini.com CANADA | QUEBEC | BROSSARD Therrien Couture L.L.P. Douglas W. Clarke................(450) 462-8555 douglas.clarke@therriencouture.com CHINA | SHANGHAI Duan&Duan George Wang........................8621 6219 1103 george@duanduan.com MEXICO | MEXICO CITY EC Legal Rubio Villegas René Mauricio Alva..........+52 55 5251 5023 ralva@ecrubio.com

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USLAW NETWORK offers legal decision makers a variety of complimentary products and services to assist them with their day-to-day operation and management of legal issues. The USLAW SourceBook provides information regarding each resource that is available. We encourage you to review these and take advantage of those that could benefit

the c om pl e t e

you and your company. For additional information, contact Roger M.

uslaw sourcebook

Yaffe, USLAW CEO, at roger@uslaw.org or (800) 231-9110, ext. 1.

USLAW is continually seeking to ensure that your legal out-

comes are successful and seamless. We hope that these resources can assist you. Please don’t hesitate to send us input on your experience with any of the products or services listed in the SourceBook as well as ideas for the future that would benefit you and your colleagues.

5, 2018 TELFA AND WED • SEP NETWORK/ BUSINESS E

ER EXCHANG USLAW ORDON CROSS-B CTI S TRANSA

EDUCATION

montreal fall 2018

US

FALL 2018

SEPT 6-8, 2018 USLAW NETW ORK • FAIRMONT THE QUEEN CLIENT CONFERE ELIZABETH NCE • MONTREAL, QC

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2019 ®

SPRIN MARC

USLAW NETWORK undoubtedly has some of the most knowledgeable attorneys in the world, but did you know that we also have the most valuable corporate partners in the legal profession? Don’t miss out on an opportunity to better your legal game plan by taking advantage of our corporate partners’ expertise. Areas of expertise include forensic engineering, legal visualization services, court reporting, jury consultation, courtroom technology, forensic accounting, structured settlements, eDiscovery, cyber security and data forensics, and investigation.

LA W N ETW

RK

It’s no secret – USLAW can host a great event. We are very proud of the industry-leading educational sessions at our semi-annual client conferences, seminars, and client exchanges.

Reaching from national to more localized offerings, USLAW member attorneys and the clients they serve meet throughout the year not only at USLAW-hosted events but also at many legal industry conferences. CLE accreditation is provided for most USLAW educational offerings.

clien t

G 2019

USLA

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NETW H 28 ORK – 30 | CLIEN JW MA T CONF RRIOT EREN T NASH CE VILLE | NASH VILLE , TN

A TEAM OF EXPERTS

USLAW ON CALL What is the value in having individual access to 4-8 highly experienced USLAW member attorneys from around the country and around the world (if necessary) roundtable specific issues you may be facing including actual cases or hypotheticals? USLAW is pleased to provide this free consultation that will give you a sense of comfort that you are managing a specific issue/case in an appropriate manner and make you aware of unforeseen roadblocks and variables that may pop up. It never hurts to phone a friend!

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LAWMOBILE

We are pleased to offer a completely customizable one-stop educational program that will deliver information on today’s trending topics that are applicable and focused solely on your business. In order to accommodate the needs of multiple staff, we go one step further and provide LawMobile right in your office or a pre-selected local venue of your choice. We focus on specific markets where you do business and utilize a team of attorneys to share relevant jurisdictional knowledge important to your business’ success. Whether it is a one-hour lunch and learn, half-day intensive program or simply an informal meeting discussing a specific legal matter, USLAW will structure the opportunity to your requirements – all at no cost to your company.

COMPENDIUMS OF LAW

USLAW regularly produces new and updates existing Compendiums providing a multi-state resource that permits users to easily access state common and statutory law. Compendiums are easily sourced on a stateby-state basis and are developed by the member firms of USLAW. Some of the current compendiums include: Retail, Spoliation of Evidence, Transportation, Construction Law, Workers’ Compensation, Surveillance, Offer of Judgment, Employee Rights on Initial Medical Treatment, and a National Compendium addressing issues that arise prior to the commencement of litigation through trial and on to appeal. Visit the Client Resources section of uslaw.org for the complete USLAW compendium library.

SUBROGATION RIGHTS FOR WORKERS’ COMPENSATION LIENS

Compendiumof Law ®

ALWAYS KNOW WHAT LIES AHEAD

STATE JUDICIAL PROFILES BY COUNTY

Jurisdictional awareness of the court and juries on a county-by-county basis is a key ingredient to successfully navigating legal challenges throughout the United States. Knowing the local rules, the judge, and the local business and legal environment provides a unique competitive advantage.

In order to best serve clients, USLAW NETWORK offers a judicial profile that identifies counties as Conservative, Moderate or Liberal and thus provides you an important Home Field Advantage.

STATE JUDICIAL PROFILES

BY COUNTY 2019

P R E PA R E D B Y T H E M E M B E R F I R M S O F

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USLAW DIGIKNOW

USLAW DigiKnow is USLAW’s bi-weekly digital e-newsletter featuring insights and perspectives on today’s trending legal issues. Articles and posts are written by USLAW member attorneys who are subject matter leaders from our nearly 20 substantive USLAW Practice Areas and the USLAW membership in general. Through USLAW DigiKnow, we share legal, legislative and jurisdictional news as well as promote upcoming USLAW events and webinars that might be of interest to you and your colleagues. It is an excellent resource to keep abreast of new case law, important verdicts and other pending legislation.

USLAW

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USLAW MOBILE APPS

W USLA

We pack light. Take USLAW with you wherever you go with two important USLAW mobile applications. Get USLAW information fast by downloading USLAW 24/7. As well, USLAW Events is our Client Conference mobile app that archives all of the presentation materials, among several other items, from past USLAW Conferences.

USLAW apps are available on iPhone/iPad, Android (by typing in keyword USLAW) and most Blackberry devices.

USLAW CONNECTIVITY

In today’s digital world there are many ways to connect, share, communicate, engage, interact and collaborate. Through any one of our various communication channels, sign on, ask a question, offer insight, share comments, seek advice and collaborate with others connected to USLAW. Please check out USLAW on Twitter @uslawnetwork and our LinkedIn group page.

FALL | WINTER | 2018

35 Million Reasons to Heed New SEC Guidance on Cybersecurity Disclosure pg28 Requirements

ATTORNEY -CLIENT PRIVILEGE

pg20

Is the Attorney-Client Privilege Under Attack?

LOCKING THE PLAINTIFF IN

Accident Demonstrations in Product Liability Litigation

BEFORE YOU SEAL THE DEAL Multiemployer Pension Plan Can Impact An Asset Purchase

pg 2

USLAW MAGAZINE

USLAW Magazine is an in-depth publication produced twice annually and designed to address legal and business issues facing commercial and corporate clients. Released in Spring and Fall, recent topics have covered cyber security & data privacy, medical marijuana & employer drug policies,management liability issues in the face of a cyberattack, defending motor carriers performing oversized load & heavy haul operations, employee wellness programs, social media & the law, effects of electronic healthcare records, patent troll taxes, allocating risk by contract and much more.

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MESSAGING APPS

Don’t Let the Disappearing Act Catch You by Surprise in Discovery

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USLAW EDUNET

A wealth of knowledge offered on demand, USLAW EduNet is a regular series of interactive webinars produced by USLAW practice groups. The one-hour programs are available live on your desktop and are also archived at USLAW.org for viewing at a later date. Topics range from Medicare to Employment & Labor Law to Product Liability Law and beyond.

The Class Action Attack upon the Motor Carrier Industry:

Defending against Independent Contractor Classification Claims, and Wage and Hour Cases

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USLAW MEMBERSHIP DIRECTORY

Each year both print and online versions of our membership directory is produced. Here you can quickly and easily identify the attorney best-suited to handle your legal issue. Arranged by state, listings include primary and alternate contacts, practice group contact information as well as firm profiles.

RAPID RESPONSE

The USLAW NETWORK Rapid Response App locates USLAW attorneys quickly when timeliness is critical for you and your company. Offered for Transportation, Construction Law and Product Liability, this resource provides clients with attorneys’ cell and home telephone numbers along with assurance that USLAW will be available 24/7 with the right person and the right experience. Available at uslaw.org and the USLAW 24/7 App.

CLIENT LEADERSHIP COUNCIL AND PRACTICE GROUP CLIENT ADVISORS

Take advantage of the knowledge of your peers. USLAW NETWORK’s Client Leadership Council (CLC) and Practice Group Client Advisors are a hand-selected, diverse group of prestigious USLAW firm clients who provide expertise and advice to ensure the organization and its law firms meet the expectations of the client community. In addition to the valuable insights they provide, CLC members and Practice Group Client Advisors also serve as USLAW ambassadors, utilizing their stature within their various industries to promote the many benefits of USLAW NETWORK.

PRACTICE GROUPS

USLAW prides itself on variety. Its 6,000+ attorneys excel in all areas of legal practice and participate in USLAW’s nearly 20 substantive active practice groups and communities including Banking & Financial Services, Commercial Law, Complex Tort and Product Liability, Construction Law, Data Privacy & Security, E-Discovery, Employment & Labor Law, Energy/Environmental, Healthcare Law, Insurance Law, International Business & Trade, IP and Technology, Professional Liability, Retail and Hospitality Law, Transportation and Logistics, White Collar Defense, Women’s Connection, and Workers’ Compensation.

Don’t see a specific practice area listed? No worries as USLAW firms cover the gamut of the legal profession and we are sure to find a firm that has significant experience in the area of need.

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THANK YOU PARTNERS

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S-E-A

OFFICIAL TECHNICAL FORENSIC ENGINEERING AND LEGAL VISUALIZATION SERVICES PARTNER

HHH HH USLAW PREMIER PARTNER

www.SEAlimited.com 7001 Buffalo Parkway Columbus, OH 43229 Phone: (800) 782-6851 Fax: (614) 885-8014 Chris Torrens Vice President 795 Cromwell Park Drive, Suite N Glen Burnie, MD 21061 Phone: (800) 635-9507 Email: ctorrens@SEAlimited.com Ami Dwyer, Esq. General Counsel 795 Cromwell Park Drive, Suite N Glen Burnie, MD 12061 Phone: (800) 635-9507 Email: adwyer@SEAlimited.com Richard R. Basom Director, National Accounts/London 7001 Buffalo Parkway Columbus, Ohio 43229 Phone: (800) 782-6851 Email: rbasom@SEAlimited.com S-E-A is proud to be the exclusive partner/sponsor of technical forensic engineering and legal visualization services for USLAW NETWORK. A powerful resource in litigation for nearly 50 years, S-E-A is a multi-disciplined forensic engineering, fire investigation and visualization services company specializing in failure analysis. S-E-A’s full-time staff consists of licensed/registered professionals who are experts in their respective fields. S-E-A offers complete investigative services, including: mechanical, biomechanical, electrical, civil and materials engineering, as well as fire investigation, industrial hygiene, visualization services, and health sciences—along with a fully equipped chemical laboratory. These disciplines interact to provide thorough and independent analysis that will support any subsequent litigation.

S-E-A’s expertise in failure analysis doesn’t end with investigation and research. Should animations, graphics, or medical illustrations be needed, S-E-A’s Imaging Sciences/Animation Practice can prepare accurate demonstrative pieces for litigation support. The company’s on-staff engineers and graphics professionals coordinate their expertise and can make a significant impact in assisting a judge, mediator or juror in understanding the complex principles and nuances of a case.

S-E-A can provide technical drawings, camera-matching technology, motion capture for biomechanical analysis and accident simulation, and 3D laser scanning and fly-through technology for scene documentation and preservation. In addition, S-E-A can prepare scale models of products, buildings or scenes made by professional model builders or using 3D printing technology, depending on the application.

You only have one opportunity to present your case at trial. The work being done at S-E-A is incredibly important to us and to our clients – because a case isn’t made until it is understood. Please visit www.SEAlimited.com to see our capabilities and how we can help you effectively communicate your position.

U.S. Legal Support, Inc

OFFICIAL COURT REPORTING PARTNER

HHH HH USLAW PREMIER PARTNER

www.uslegalsupport.com 16825 Northchase Drive, Suite 900 Houston, TX 77060 Phone: (800) 567-8757 Fax: (713) 653-7172 Charles F. Schugart President & CEO 16825 Northchase Drive, Suite 900 Houston, TX 77060 Phone: (832) 201-3834 Email: cfschugart@uslegalsupport.com Pete Giammanco Executive VP & COO 16825 Northchase Drive, Suite 900 Houston, TX 77060 Phone: (818) 995-0600 Email: pgiammanco@uslegalsupport.com Jim Cunningham Senior VP, Division President Midwest Region 200 West Jackson Boulevard, Suite 600 Chicago, IL 60606 Phone: (312) 236-8352 Email: jcunningham@uslegalsupport.com Shana Holton Senior VP, Division President West Region 575 Anton Blvd., Suite 400 Costa Mesa, CA 92626 Phone: (714) 955-4887 Email: sholton@uslegalsupport.com Headquartered in Houston, Texas, and founded in 1996, U.S. Legal Support is a privately held company with over 85 offices located across the United States. As one of the leading providers of litigation services, U.S. Legal Support is the only litigation support company that provides a full suite of court reporting solutions, record retrieval, interpreting & translations, trial services and transcription services to major insurance companies, corporations and law firms nationwide.

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Consilio

OFFICIAL E-DISCOVERY, CYBERSECURITY AND DATA FORENSICS PARTNER

Litigation Insights

OFFICIAL JURY CONSULTANT AND COURTROOM TECHNOLOGY PARTNER

www.consilio.com 1828 L Street, NW Suite 1070 Washington, DC 20036 Phone: (877) 714-6204

www.litigationinsights.com 9393 W. 110th Street, Suite #400 Overland Park, KS 66210 Phone: (913) 339-9885 Twitter: @LI_Insights

Bryan Duberow Managing Director (West Region) Email: bryan.duberow@consilio.com

Merrie Jo Pitera, Ph.D. Chief Executive Officer Phone: (913) 486-4159 Email: mjpitera@litigationinsights.com

Greg Lutz Managing Director (East Region) Email: glutz@consilio.com Roger Miller Managing Director (Central Region) Email: roger.miller@consilio.com Michael Pontrelli Managing Director (West Region) Email: mpontrelli@consilio.com Andrew Stone Managing Director (Central Region) Email: andrew.stone@consilio.com Consilio is proud to be the official eDiscovery, cybersecurity and data forensics partner of USLAW NETWORK. Consilio is a global leader in eDiscovery, risk management and compliance, document review, and legal consulting services. The company assists legal departments of multinational corporations and their outside counsel to respond to legal matters, reduce legal spend, minimize risks, and operate more efficiently using innovative software, costeffective managed services, and deep legal and regulatory industry expertise across a spectrum of industries. Consilio and its global family of companies, DiscoverReady, Advanced Discovery, Altep, Millnet Document Services and Legal Placements Inc., employ leading professionals in the industry, applying defensible workflows with patented and industry-proven technology across all phases of the eDiscovery and risk management lifecycle. ISO 27001:2013 certified, the company operates offices, document review facilities, and data centers across Europe, Asia, and North America.

Adam Bloomberg Vice President – Managing Director of Visual Communications Phone: (214) 658-9845 Email: abloomberg@litigationinsights.com Jill Leibold, Ph.D. Director of Jury Research Phone: (310) 809-8651 Email: jleibold@litigationinsights.com Christina Marinakis, J.D., Psy.D. Director – Jury Research Phone: (443) 742-6130 Email: cmarinakis@litigationinsights.com Since 1994, Litigation Insights has been a nationally recognized leader in the trial consulting field.

Litigation Insights is proud to be the exclusive corporate sponsor of jury research and courtroom technology services for USLAW NETWORK. Our clients hire us when their cases are complex, difficult and/or unclear. They bring us in when issues are volatile, emotions are high, and millions of dollars are at risk. We’re asked to consult on tough litigation because we’ve seen so many tough cases and, more importantly, we’ve provided valuable insights. Remember, not every case needs a mock trial.

We also support your litigation efforts with smaller budget services such as theme development, witness preparation, voir dire and jury selection.

Our courtroom consultants, or “Hot Seat” operators, have no fewer than 12 years of experience in the application of industry-leading presentation software and equipment, as well as an advanced knowledge of courtroom protocol and procedure.

We make a point of learning the case facts, becoming familiar with your exhibits and video depositions, and we work closely with the trial attorneys to provide continuity and peace of mind.

Litigation Insights has been certified as a Women’s Business Enterprise by the Women’s Business Enterprise National Council (WBENC).

For more information on how can help with jury research and/or courtroom technology support, please contact any of our executive staff listed above.

Marshall Investigative Group OFFICIAL INVESTIGATIVE PARTNER

www.mi-pi.com 401 Devon Ave. Park Ridge, IL 60068 Phone: (855) 350-6474 (MIPI) Fax: (847) 993-2039 Doug Marshall President Email: dmarshall@mi-pi.com Adam M. Kabarec Vice President Email: akabarec@mi-pi.com Matt Mills Vice President of Business Development Email: mmills@mi-pi.com Thom Kramer Director of Internet Investigations Email: tkramer@mi-pi.com Amie Norton Business Development Manager Email: anorton@mi-pi.com Liva Rivera Business Development Consultant Email: lrivera@mi-pi.com Marshall Investigative Group is a national investigative firm providing an array of services that help our clients mediate the validity of questionable cargo, disability, liability and workers’ compensation claims. Our specialists in investigations and surveillance have a variety of backgrounds in law enforcement, criminal justice, military, business and the insurance industry. Our investigators are committed to innovative thinking, formative solutions and detailed diligence.

One of our recent achievements is leading the industry in Internet Presence Investigations. With the increasing popularity of communicating and publishing personal information on the internet, internet presence evidence opens doors in determining the merit of a claim. Without approved methods for collection and authentication this information may be inadmissible and useless as evidence. Our team can preserve conversations, photographs, video recordings, and blogs that include authenticating metadata, and MD5 hash values. Our goal is to exceed your expectations by providing prompt, thorough and accurate information. At Marshall Investigative Group, we value each and every customer and are confident that our extraordinary work, will make a difference in your bottom line.

Services include: • Activity/Background Checks • AOE / COE • Asset Checks • Bankruptcies • Contestable Death • Criminal & Civil Records • Decedent Check • Health History

• Intellectual Property Investigations • Internet Presence Investigations • Pre-Employment • Recorded Statements • Skip Trace • Surveillance

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MDD Forensic Accountants

Structured Financial Associates, Inc

www.mdd.com 11600 Sunrise Valley Drive, Suite 450 Reston, VA 20191 Phone: (703) 796-2200 Fax: (703) 796-0729

www.sfainc.com 3060 Peachtree Road, NW Suite 1150 Atlanta, GA 30305 Phone: (770) 393-1028 Fax: (770) 393-4432 Toll Free: (800) 638-5890

OFFICIAL FORENSIC ACCOUNTANT PARTNER

David Elmore, CPA, CVA 11600 Sunrise Valley Drive, Suite 450 Reston, VA 20191 Phone: (703) 796-2200 Fax: (703) 796-0729 Email: delmore@mdd.com Kevin Flaherty, CPA, CVA 10 High Street, Suite 1000 Boston, MA 02110 Phone: (617) 426-1551 Fax: (617) 426-6023 Email: kflaherty@mdd.com Matson, Driscoll & Damico is a leading forensic accounting firm that specializes in providing economic damage quantification assessments for our clients. Our professionals regularly deliver expert, consulting and fact witness testimony in courts, arbitrations and mediations around the world.

We have been honored to provide our expertise on cases of every size and scope, and we would be pleased to discuss our involvement on these files while still maintaining our commitment to client confidentiality. Briefly, some of these engagements have involved: lost profit calculations; business disputes or valuations; commercial lending; fraud; product liability and construction damages.

However, we have also worked across many other practice areas and, as a result, in virtually every industry.

Founded in Chicago in 1933, MDD is now a global entity with over 40 offices worldwide.

In the United States, MDD’s partners and senior staff are Certified Public Accountants; many are also Certified Valuation Analysts and Certified Fraud Examiners. Our international partners and professionals possess the appropriate designations and are similarly qualified for their respective countries. In addition to these designations, our forensic accountants speak more than 30 languages.

Regardless of where our work may take us around the world, our exceptional dedication, singularly qualified experts and demonstrated results will always be the hallmark of our firm. To learn more about MDD and the services we provide, we invite you to visit us at www.mdd.com.

OFFICIAL STRUCTURED SETTLEMENT PARTNER

Richard Regna, CSSC CEO/President 3060 Peachtree Road, NW, Suite 1150 Atlanta, GA 30305 Phone: (800) 638-5890 Email: rregna@sfainc.com John Machir Chief Marketing Officer 7255 E. Griswold Road Scottsdale, AZ 85258 Phone: (800) 638-5890 Email: jmachir@sfainc.com Structured Financial Associates, Inc. is honored to be USLAW’s exclusive partner for structured settlement services.

Structured Financial Associates, Inc. (“SFA”), a founding leader in the structured settlement business, takes a multifaceted approach to claims resolution. The use of structured settlement annuities to provide consistent income to injured parties while honoring the business practices of our client partners is the core of our business model. SFA consultants assist in the establishment and funding of other settlement tools, including Special Needs Trusts and Medicare Set-Aside Arrangements, and SFA is strategically partnered to provide innovative market-based, tax-efficient income solutions for injured plaintiffs and their legal counsel.

Structured Financial Associates, Inc. was founded in 1985 and is one of the largest structured settlement companies in the industry. SFA is a member of Integrated Financial Settlements (IFS) and has more than 60 structured settlement consultants with offices in every major metropolitan area of the country. SFA’s full-service operations and support teams are comprised of veterans of the settlement industry and are dedicated to providing superior service to its customers throughout the United States. Our knowledge and ability to create comprehensive and tailor-made solutions makes SFA invaluable to defense clients, injured plaintiffs and their attorneys.

THANK YOU PARTNERS

2 0 19 USLAW C orporate Part n e r s

We’ve been prepping for your next case for nearly 50 years.

S-E-A’s engineers, technicians and investigators have conducted independent and objective evaluations and analyses to produce real answers and articulate them in court since 1970.

For more information, call 800.782.6851 or visit www.SEAlimited.com.

Proud Partner USLAW NETWORK Inc. since 2004.

REVEALING THE CAUSE. MITIGATING THE RISK. Engineering, Investigation and Analysis since 1970

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“AM I LIABLE BECAUSE YOU DID NOT FOLLOW MY TRAVEL DIRECTIONS?”

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