NLRB Administrative Judge Finds Employee Facebook Post Was Protected Speech

A recent decision by the National Labor Relations Board attempts to define further the boundaries of protected speech under the National Labor Relations Act, reports Seyfarth Shaw in its Employment Law Lookout blog.

Writers Erin Dougherty Foley and Craig B. Simonsen explain that the initial question in Laborers’ International Union of North America and Mantell was whether the union restrained or coerced Frank Mantell in the exercise of a Section 7 right. The union member posted comments on a Facebook page that criticized the Union for allowing a Niagara Falls city councilman, running for mayor, to obtain a journeyman’s book.

The union tried Mantell and fined him $5,000, as well as suspending his membership for 24 months. After an appeal, the International Union directed the local to dismiss charges against Mantell.

An NLRB Administrative Law Judge found that Mantell’s Facebook posts were protected under the National Labor Relations Act.

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Mylan to Pay $465 Million Over EpiPen Medicaid Rebate Dispute

EpiPen

Image by Intropin

Mylan NV has announced it will pay $465 million to settle questions of whether it underpaid U.S. government healthcare programs by misclassifying its EpiPen emergency allergy treatment, Reuters is reporting. The announcement comes as the company is under intense scrutiny after a series of drastic price increases.

“Mylan has been lambasted by consumers and lawmakers for raising prices on the lifesaving EpiPen sixfold to over $600 for a package of two in less than a decade, making the devices unaffordable for a growing number of families,” writes Deena Beasley.

At issue is whether Mylan made more money on EpiPen than warranted from state Medicaid programs by having it classified as a generic product. That classification yielded much smaller rebates to the government health plans. Beasley explains that the Medicaid rebate for a generic prescription drug is 13 percent, compared with a minimum 23.1 percent for a branded drug.

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New York Proposes Cybersecurity Regulation for Insurance Companies, Banks, Financial Institutions

Section symbol - regulationsNew York State has proposed a new regulation that requires insurance companies, banks, and other financial services institutions regulated by the New York State Department of Financial Services (DFS) to establish and maintain a cybersecurity program designed to protect consumers and ensure the safety and soundness of New York State’s financial services industry, reports Jason O. Balogh, a partner with Hickey Smith LLP.

If enacted, this change would bring the first statewide regulation mandating that insurance companies, banks, and other financial institutions create such a program. The regulation would set forth fairly general minimum standards, Balogh explains in the article published on the firm’s website.

“Among other requirements, under the proposed regulation, insurance companies, banks, and other financial institutions would be required to set out detailed plans for handling data breaches, increase their monitoring of how third-party vendors handle and secure data, and appoint a chief information security officer. While many insurance companies, banks, and other financial institutions will find that elements of the proposed regulation are similar to those found in existing regulatory and technical guidance, they have not previously been required as a matter of law,” Balogh writes.

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Litigator Craig Woods Joins Dykema’s Dental Service Organizations Industry Group in Dallas

Dykema, a national law firm, announced the addition of Craig Woods to its Commercial Litigation Practice Group and Dental Service Organizations Industry Group as a member in the firm’s Dallas office. Prior to joining Dykema, Woods practiced at the Dallas office of Greenberg Traurig LLP.

In a release, the firm said Woods has a national practice that focuses on serving clients on a broad range of matters, including contractual disputes, breach of fiduciary duty, theft of trade secrets, unfair competition, covenants not to compete, injunctive actions, fraud and deceptive trade practices, products liability litigation, medical device litigation, financial services litigation and complex business litigation. In addition to handling individual claims, he also has experience litigating disputes in the context of class action lawsuits.

The firm’s release continues:

Woods also has considerable experience advising Dental Service Organizations (DSOs), Medical Service Organizations (MSOs), large practice groups, dentists and other health care providers in various corporate and regulatory matters, including the preparation of regulatory compliant business agreements between DSOs and their affiliated practices and dentists. He also has substantial experience in complex commercial, business and health care law where he has advised and represented Fortune 500 and industry-leading dental, medical and health care companies.

“We are extremely excited to welcome Craig to our DSO team and commercial litigation practice,” said Chris Kratovil, Office Managing Member of the Firm’s Dallas office and Assistant Leader of Dykema’s Commercial Litigation Practice Group. “Craig’s extensive background litigating cases for a wide variety of clients enhances our bench strength in Dallas, and his experience will be a great benefit to the firm’s ever-expanding DSO Industry Group, as well as its clients.”

Woods, who has been recognized in Texas Super Lawyers as a Rising Star each year since 2010, received a J.D., cum laude, from the Southern Methodist University Dedman School of Law, as well an M.S. in Finance, and a B.B.A., cum laude, in Financial Management and Information Systems from Texas A&M University.

 

 

 




Former Baylor Title IX Coordinator Patty Crawford Says She Was Set Up to Fail

Patty Crawford, the Baylor University Title IX coordinator who recently resigned from the university, says Baylor set her up to fail from the beginning. Crawford appeared on “CBS This Morning” with her attorney Rogge Dunn of Dallas’ Clouse Dunn LLP to discuss her decision to leave.

On its website, Androvett Legal Media & Marketing reported on the interview:

“Ms. Crawford wants to make sure her story is told so the public knows what is really going on at Baylor and women there can receive the protection they deserve,” says Dunn.

Crawford claims Baylor didn’t allow her to fulfill her responsibilities as Title IX coordinator then retaliated against her for fighting discrimination.

“I continued to work very hard, and the harder I worked the more resistance I received from senior leadership,” Crawford told CBS.

Baylor University hired Crawford in November 2014 to handle Title IX directives and the university’s sexual discrimination policies, including sexual assault complaints. The university faced multiple lawsuits and accusations of ignoring sexual assault claims. Baylor’s Board of Regents hired Philadelphia law firm Pepper Hamilton to conduct an investigation that led to a scathing report blasting the university for failing to adequately respond to the complaints. In response to the report, university president Ken Starr and head football coach Art Briles were removed, and athletic director Ian McCaw resigned. Pepper Hamilton gave the university more than 100 recommended improvements to its Title IX policies, which the university has adopted as mandates.

“Patty is justifiably proud of what she was able to accomplish, but also profoundly troubled by what she views as Baylor’s efforts to impede her ability to fully perform her Title IX responsibilities,” says Dunn.




Delivery By Drone? Maybe When Pigs Fly, Says FAA

DroneThe enactment of new Federal Aviation Administration (FAA) regulations governing unmanned aircraft systems – or “drones” – has companies and consumers alike dreaming of the stuff of science fiction, but if the new regulations are any indication, the FAA is in no rush to see those dreams become reality, write Sarah L. Bruno, Anthony V. Lupo and Daniel B. Jasnow of Arent Fox LLP.

The new regulations permit use of drones for some commercial purposes, but the FAA declined to clear the way for package delivery by drone, according to the article on the firm’s Behind the Scenes blog.

“Although not a blank check for commercial interests, the FAA’s new rule on commercial drone use likely signals just the beginning of a long regulatory debate over the commercial use of unmanned aircraft, as well as the potential safety and privacy concerns that should, or should not, influence such a debate,” the authors write.

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Payday Loan Mogul Scott Tucker’s $1.3 Billion Judgment is a Record for the FTC

The Federal Trade Commission, in its first public remarks since a federal judge last week entered a $1.3 billion judgment against payday loan businessman Scott Tucker, called the penalty the largest of its kind, reports The Kansas City Star.

The judgment against Tucker and related entities eclipses the FTC’s previous record judgment from litigation: a $478 million judgment in 2012 ($501.4 million, when adjusted for inflation) against John Beck, the perpetrator of a deceptive real estate get-rich-quick scheme, according to reporter Steve Vockrodt.

U.S. District Court Judge Gloria Navarro last week entered a $1.3 billion judgment against Tucker and others to wrap up a case brought by the FTC in 2012.

“The FTC tracked and sued Tucker, his brother Blaine Tucker and several corporations under their control on claims that they extended loans that deceived consumers about the true cost of their credit,” Vockrodt explains. “For example, the FTC said that $300 loans extended by Tucker’s companies cost $390, at a 30 percent interest rate. In reality, through deceptive loan terms and automatic loan renewals, the FTC said many consumers ended up paying nearly $1,000.”

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Obama Takes Aim at U.S. Corporations Shifting Profit Overseas

Banking - taxes - moneyReuters is reporting that U.S. regulations, proposed by the Treasury to crack down on companies that try to reduce taxes by rebasing abroad, have begun a White House review and could be finalized shortly.

The regulations would make it difficult for U.S. business operations to avoid taxation while shifting profits overseas through a practice called “earnings stripping.”

The White House Office of Management and Budget regulations received the proposed regulations last week and now has up to 90 days to decide whether the rules should be finalized or returned to Treasury for further consideration, reports Reuters’ David Morgan.

“The Obama administration has faced widespread criticism from the business community over its regulatory assault on tax inversions, which are tax-driven mergers in which a U.S. company acquires a smaller, foreign business in a low-tax country and shifts its headquarters there, if only on paper, to avoid higher U.S. taxes,” according to the report.

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Executive Pay Clawbacks Are Gratifying, but Not Particularly Effective

Businessman - executiveIf the goal of compensation clawbacks is to keep corporate executives honest, then they aren’t doing the job, according to a report by The New York Times.

As evidence, writer  recent action by Wells Fargo’s board. The bank’s directors acted on Tuesday to recover $60 million in stock grants from two top executives after a phony-account-opening scandal rocked the company and its executives. But the move came almost three years after the improprieties came to light.

There are several reasons givebacks are rare, Morgenson reports: “One is that corporations limit the scope of their recovery policies. For example, the policies are written to cover only a portion of an executive’s pay.”

“Clawbacks extending to all types of compensation are uncommon,” James F. Reda, managing director of executive compensation consulting at Arthur J. Gallagher & Company, told the reporter. “They typically only apply to the cash portion and only to the top executives.”

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U.S. Clean Power Plan Remains on Firm Legal Ground Says AWEA

While the oral arguments about the merits of the Clean Power Plan are heard by the U.S. Court of Appeals for the D.C. Circuit, the American Wind Energy Association (AWEA) remains confident the plan will be upheld by the courts, reports Renewable Energy Magazine.

The Clean Power Plan is the Environmental Protection Agency’s rule placing the first-ever federal carbon pollution limits on American electric power plants, writes Robin Whitlock.

Tom Kiernan, CEO of AWEA, issued a statement, saying in part: “The clean-energy train has already left the station in the form of affordable renewable energy already making major carbon pollution reductions today. The Clean Power Plan reasonably builds on these existing trends in the power sector that have allowed many states to reliably and cost-effectively slash carbon pollution at a rapid rate over the last decade through investment in clean sources of electric generation, like wind power. We fully expect the D.C. Circuit to agree that EPA correctly took these facts into account in considering well-established pollution control measures, such as renewable energy, when establishing carbon reduction standards for power plants under the plan.”

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OSHA Joins SEC in Attacking Confidentiality in Private Settlement Agreements

OSHAThe federal Occupational Safety and Health Administrationreleased new policy guidelines in September for its review of private settlement agreements presented to the agency for approval in whistleblowing actions, reports Littler Mendelson P.C.

Authors Ed Ellis, Chip Jones and Kevin Griffith write that OSHA issued these guidelines based on its concern that certain confidentiality and other provisions in settlement agreements may unlawfully restrict or discourage employee activity that the government would like to protect and promote. The new policy guidelines track the approach recently adopted  by the U.S. Securities and Exchange Commission.

The article explains that the SEC issued an agreed cease-and-desist order on August 10, 2016 in BlueLinx Holdings, Inc., requiring the company to amend its severance agreements. “In that cease-and-desist order, the SEC directed the company to remove language from its agreements that prevented employees from accepting monetary awards from the SEC for whistleblowing complaints. BlueLinx also agreed to pay a $265,000 civil penalty,” according to the article.

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Thomson Reuters, Clifford Chance Deliver OTC Derivatives Documentation Solutions

Thomson Reuters and Clifford Chance have joined forces to help global financial institutions deal in a more cost-effective manner with regulatory obligations relating to margin rules for uncleared over-the-counter (OTC) derivatives, Thomson Reuters announced.

“Using an innovative approach to contract negotiation and documentation, the partnership offers a flexible, rapidly scalable, technology-enabled solution that will empower these financial institutions to meet their current multi-jurisdictional regulatory obligations and as they continue to evolve in the future,” the company says in a release.

The release continues:

Pressure on both buy-side and sell-side financial institutions is growing as new regulatory deadlines relating to margin for uncleared OTC derivatives loom large and the volume and complexity of contract work needed to meet compliance obligations increases. In addition, the internal challenge within all financial institutions to find further cost-efficient ways to operate has caused many to look again at their own internal processes, specifically their existing documentation and negotiation processes.

The collaboration between Thomson Reuters, one of the world’s most innovative providers of intelligent information and solutions, with Clifford Chance, one of the world’s pre-eminent international law firms, offers deep legal acumen and financial industry experience powered by highly efficient processes and advanced technology. Thomson Reuters is applying its proprietary contract automation software, Contract Express, and abstraction technology built specifically for OTC documentation. This Thomson Reuters technology platform enables its teams to rapidly generate compliant and consistent documentation to clients’ specifications, easily extract key terms from existing documentation and enable advanced analytics of the clients’ agreements, which ultimately results in cost and time savings.

“By working with Thomson Reuters we can combine our deep understanding of the difficult challenges financial institutions face with a powerful, scalable delivery platform to offer clients the best of both worlds,” said Paul Landless of Clifford Chance Singapore. “The fact that we can fully support from Clifford Chance teams across New York, London, Europe and Asia Pacific to work with Thomson Reuters places us perfectly to tackle both the local regulatory issues and the complex, international challenges our clients face.”

David Felsenthal of Clifford Chance New York said, “At Clifford Chance we are always exploring new ways of working to ensure we deliver our legal expertise in the best possible way for our clients across the globe, considering everything from deploying artificial intelligence to working with carefully chosen partners. This is particularly relevant for the complicated, multi-jurisdictional regulatory and documentation remediation challenges now facing the financial services sector.”

“Thomson Reuters supports financial institutions with their ongoing master documentation needs by leveraging a global team comprised of OTC derivatives documentation lawyers and professionals with direct experience working in major financial institutions,” said Gregory McPolin, chief operating officer of Thomson Reuters Legal Managed Services. “Plus we have developed an industry-leading approach to tackling the time sensitive documentation needs driven by new and changing regulations for financial institutions and other heavily regulated industries.”

Maria Garcia, head of Financial Documentation Services for Thomson Reuters Legal Managed Services explained that “combining those knowledgeable resources with advanced technology, such as Contract Express, uniform processes and efficient project management allows us to handle high volumes of work in tight timeframes. As a result, our clients have found their negotiations are propelled forward faster and at a lower cost. We believe this technology-enabled service model coupled with the derivatives-related legal knowledge and counsel from Clifford Chance presents a powerful and exciting proposition to the financial services industry.”

 




Salesforce Pushes Regulators to Block Microsoft’s LinkedIn Deal

LinkedInSalesforce once enjoyed a cozy relationship with Microsoft, now it’s urging regulators to kill Microsoft’s deal to buy LinkedIn as “anticompetitive,” according to the company’s chief legal officer.

CNN Money is reporting that Salesforce also bid for LinkedIn, but lost out to Microsoft’s $26.2 billion bid for the professional social network.

“Microsoft’s proposed acquisition of LinkedIn threatens the future of innovation and competition,” Burke Norton, chief legal officer at Salesforce, said in a statement. “By gaining ownership of LinkedIn’s unique dataset of over 450 million professionals in more than 200 countries, Microsoft will be able to deny competitors access to that data, and in doing so obtain an unfair competitive advantage.”

“The combative remarks hint at a renewed chill in the relationship between Salesforce and Microsoft,” writes CNN’s Seth Fiegerman. “The two companies entered into a global strategic partnership in 2014, heaping praise on one another after years of fierce competition. It was unclear how Salesforce’s comments would impact the partnership.”

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Trump Foundation Lacks Certification Required for Charities That Solicit Money

The Washington Post is reporting that the charitable Donald J. Trump Foundation — which has been sustained for years by donors outside the Trump family — has never obtained the certification that New York requires before charities can solicit money from the public, according to the state attorney general’s office.

New York state law requires any charity that solicits more than $25,000 a year from the public to obtain a special kind of registration before collecting contributions, reports The Post‘s David A. Fahrenthold. The law also requires large charaties to submit to a rigorous annual audit that asks — among other things — whether the charity spent any money for the personal benefit of its officers.

“If New York Attorney General Eric Schneiderman (D) finds that Trump’s foundation raised money in violation of the law, he could order the charity to stop raising money immediately,” writes Farenthold. “With a court’s permission, Schneiderman could also force Trump to return money that his foundation has already raised.”

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Newly Organized Employer Must Bargain Discretionary Employee Discipline Pre-First Contract

Jackson Lewis reports that, prior to entering into a first contract, an employer has a statutory obligation to bargain with the union that represents its employees before imposing discretionary “serious discipline” (such as suspension, demotion, or discharge) on any of those employees, the National Labor Relations Board again has held.

In its ruling in Total Security Management Illinois 1, LLC, 364 NLRB No. 106, the board found that discretionary discipline, like pay rates and benefits, is a term and condition of employment, and, thus, a mandatory subject of bargaining. The board also held bargaining is required about less serious degrees of discipline, such as oral or written warnings, but may occur after the discipline is imposed, write Philip B. Rosen and Howard M. Bloom.

“Despite this decision, employers and unions in the midst of first contract bargaining may continue to agree on the employer’s unilateral right to impose discipline or on a procedure for bargaining over discipline that is less cumbersome than that imposed by the Board,” they conclude.

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When Arbitration Is Favored Despite USERRA Violations

Juan C. Enjamio and Robert Scavone Jr. of Hunton & Williams report that the Eleventh Circuit recently addressed a novel issue: What should courts do when faced with an employment contract containing provisions that run afoul of a statute aimed at protecting the rights of men and women who serve in the armed forces?

The Eleventh Circuit answered this question in Bodine v. Cook’s Pest Control Inc., and held that an arbitration agreement in an employment contract is enforceable despite the fact that certain provisions of the arbitration agreement violate the Uniform Services Employment and Reemployment Rights Act of 1994 (USERRA).

They explain that Congress enacted USERRA in part “to prohibit [employers from] discriminat[ing] against persons because of their service in the uniformed services.”

Rodney Bodine brought suit against his former employer under USERRA and state law, alleging, inter alia, that Cook’s discriminated against him because of his military service. Bodine argued that the entire arbitration agreement of his employment contract was void under USERRA’s nonwaiver provision because the statute of limitations and attorneys’ fees provisions of the arbitration agreement conflicted with USERRA.

The appellate court affirmed the district court’s order and concluded that “USERRA’s nonwaiver provision should not be read to automatically invalidate an entire agreement with USERRA-offending terms.”

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New Risk for GCs – Contracts With Human Rights Clauses

Human rightsResearch conducted as part of a flagship report on human rights published in partnership with Herbert Smith Freehills shows that the growing importance of corporate human rights clauses is changing the way GCs operate, reports Legal Business.

A survey of 275 GCs and senior counsel found that 46 percent of businesses now have a human rights policy in place. For companies in the $10bn+ revenue bracket, that figure rises to 84 percent.

Reporter James Wood writes, “As Stéphane Brabant, co-head of Herbert Smith Freehills’ business and human rights group, commented: ‘Human rights are not a law-free zone for businesses. Failing to respect human rights presents real legal risks for companies and the way lawyers, both in-house and external, advise businesses requires a new way of thinking – this is a new legal practice.’ ”

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Employers Under Fire for Improper Use of Independent Contractors

Two Gulf Coast oilfield services and marine staffing firms recently agreed to pay more than $500,000 in fines to settle federal lawsuits that alleged they skirted employment rules and overtime laws by improperly paying workers as contractors to reduce overtime costs, according to an article published by Androvett Legal Media & Marketing.

The penalties are the latest reminders to Texas employers of the consequences of a continued federal and state crackdown on employee misclassification, says Dallas attorney Audrey Mross, who leads the Labor & Employment section at Munck Wilson Mandala.

Such enforcement efforts have gained steam in 34 states, including Texas. These states signed on to an initiative to share information and aid the feds in identifying and punishing employers who fail to properly classify workers as employees. In addition, the National Labor Relations Board recently found that a trucking company improperly classified its drivers as independent contractors, which interfered with their rights to join labor unions.

“Businesses that are not on top of this issue are operating in perilous territory,” Mross says. “Any employer using independent contractors should analyze whether workers are properly classified and regularly re-evaluate those relationships. Violators face a long list of economic penalties, including fines, back pay, IRS penalties and legal fees.”

 




Florida AG Defends Decision to Take Money From Trump

Pam Bondi

Pam Bondi

Florida Attorney General Pam Bondi said she had no regrets about asking Donald Trump for money and no regrets about keeping the donation even after New York Attorney General Eric Schneiderman had filed a lawsuit against Trump University, reports the Associated Press.

“If I had returned it, you would have reported ‘Bondi accepted a bribe, got caught and returned it,'” Bondi said. “That’s how the reporting goes. And so, no, there was nothing improper about it. So there was no reason to return it.”

Reporters Gary Fineout and Michael Biesecker write that Rep. Ted Deutch, a South Florida Democrat and member of the House Judiciary Committee, said in a statement that “Bondi’s murky answers only raise more questions” that should be looked into by federal prosecutors.

Bondi’s office said at the time of the donation that it was “reviewing” the New York lawsuit, but it never took any other action.

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ExxonMobil Accounting Practices Probed By New York Attorney General

Image by Mike Mozart

Image by Mike Mozart

New York Attorney General Eric Schneiderman is investigating why Exxon Mobil Corp. hasn’t written down the value of its assets, two years into a pronounced crash in oil prices, reports The Wall Street Journal.

Schneiderman’s office already is looking into Exxon’s past knowledge of the impact of climate change and how it could affect its future business.

“Since 2014, oil producers world-wide have been forced to recognize that wells they plan to drill in the future are worth $200 billion less than they once thought, according to consultancy Rystad Energy,” reports Bradley Olson. “Because the fall in prices means billions of barrels cannot be economically tapped, such revisions have become a staple of oil-patch earnings, helping to push losses to record levels in recent years.”

But Exxon is the only major oil producer not to take any write-downs, leading some analysts to question its accounting practices,” Olson writes.

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