Client Alerts

Michigan House Bill 4198, recently introduced by State Representative Lucido (R-Washington Township), doesn’t just severely restrict non-compete clauses in employment agreements, it seeks to ban them outright.

The U.S. Citizenship and Immigration Services has announced a new rule allowing certain spouses of H-1B worker to apply for employment authorization. The rule takes effect on May 26, 2015.

In December 2012, Michigan enacted separate right-to-work statutes for both the private sector, Public Act 348, and the public sector, Public Act 349. But the right-to-work statutes did not take effect until March 28, 2013, and they permitted employers and unions to retain and enforce union security clauses that were contained in agreements before March 28, 2013. For that reason, before that March 28, 2013 effective date, labor unions, in both the private sector and the public sector, sought to negotiate lengthy extensions of the union security clauses, which require an employee to become and remain a union member as a condition of employment. The unions’ purpose was to delay the effect of the right-to-work law and, consequently, the ability of union members to discontinue their mandatory union membership under that law.

The Michigan Legislature recently enacted legislation outlining a property owner’s liability for the injury or death of a trespasser. Although the statute is technically “new,” the legal principals expressed by the legislature simply mirror those applied by Michigan courts for decades, developed through case law.

Recently, we were retained to represent a non-U.S. parent corporation which had encountered employee benefits difficulties due to its acquisition of two completely unrelated U.S. businesses. The difficulties arose due to a concept known as a “controlled group” – a concept unique to the employee benefits and tax arenas. First, we very briefly discuss the controlled group concept. Then we very briefly list some implications of entities being part of the same controlled group. We conclude by suggesting that when purchasing U.S. businesses, non-U.S. companies should retain employee benefits counsel to advise them on U.S. employee benefits issues.

In what might well be the beginning of a new wave of litigation arising out of the current epidemic of cyber breaches, Travelers Casualty and Surety Company of America has brought suit against Incognito Studios, a web designer, to recover payments Travelers paid to its insured, Alpine Bank, to cover losses caused by the breach of the bank’s confidential data by hackers. Travelers is suing as the assignee and subrogee of the bank. The Complaint alleges that the web designer was negligent by, among other things, not placing adequate anti-malware software on the bank’s server, not disabling one or more websites of other customers running on the same server, and failing to maintain adequate encryption of bank customer data.

In this world of connectivity, automobiles become one large mobile device, transmitting and receiving data whether running or not. Whether you are a component manufacturer or a digital provider streaming content into the vehicle, there are new concerns surrounding tracking and hacking that may put American drivers at risk.

Michigan labor unions have filed several lawsuits challenging the legality of Michigan’s right-to-work laws for the private sector and the public sector. One lawsuit filed by labor unions and some anti-right-to-work politicians claimed that the laws should be invalidated under Michigan’s Open Meetings Act. The OMA requires that meetings be “open to the public,” MCL 15.263, but does not define that phrase. On February 6, 2015, the Michigan Court of Claims, by Judge Deborah Servitto, dismissed the unions’ lawsuit in its entirety. The legality of the right-to-work laws, in other words, survived this union challenge under the Open Meetings Act.

The deep freeze that has been sweeping across the nation is not the only chill in the air. On January 29, 2015, the U.S. Department of Health & Human Services, Centers for Medicare and Medicaid Services (“CMS”), extended for another 6-months the moratorium freezing enrollment of Home Health Agencies (“HHA”) and Ambulance Suppliers in federal healthcare programs, including Medicare, Medicaid, and CHIP. The Initial moratorium was effective January 30, 2014 and extended an additional 6 months in July 2014. A similar restriction has been in force in areas surrounding Chicago and Miami since July 2013.

The Federal Communications Commission recently issued a Policy Statement in which it announced a new methodology for assessing forfeitures (penalties) on service providers who fail to pay the annual federal regulatory fees and make timely contributions to the Universal Service Fund (USF), the Telecommunications Relay Service (TRS) Fund, and the cost recovery mechanisms for local number portability (LNP) and the North American Numbering Plan (NANP) collected by the Universal Service Administrative Company (USAC).

The current situation in the region of Syria and Iraq involving the Islamic State (ISIS) seems to worsen daily. The danger for America is very real, and extends beyond potential military hostilities or even terrorism. American businesses that export or are willing to export may be at heightened legal risk. Export Control regulations and related enforcement places a significant responsibility and associated risks on American individuals and companies. The penalties for export violations, both civil and criminal, can be (and often are) draconian; and “I didn’t know” has no weight as a defense or mitigating factor where penalties for exports or technology transfer violations are involved.

The Federal Circuit held that the term “molecular weight” was fatally indefinite, rendering a patent for making Copaxone (a drug for treating MS) invalid. In Teva Pharmacueticals USA, Inc. v. Sandoz, Inc., 574 U.S. __, __ (2015), the Supreme Court vacated the Federal Circuit’s judgment.

Recently, Chrysler published a new version, dated December 2014, of its Production And Mopar Purchasing Terms And Conditions ("New Terms"). The New Terms are not retroactive and apply only to the NAFTA region.

In a Final Rule published in the Federal Register on December 15, 2014, the National Labor Relations Board has issued new representation election rules which will significantly reduce the period between the filing of an election petition by a union and the holding of an NLRB election. The new procedures will seriously affect the ability of employers to effectively communicate a union-free message to their work force in the course of a union election campaign, and will require employers to be more proactive in their employee relations programs in order to maintain non-union status. The new rules are scheduled to take effect on April 15, 2015.

In a long-awaited and widely-expected ruling, the NLRB held that employee use of company email systems on non-work time for activities protected by the National Labor Relations Act must be permitted if employers have given employees access to their email systems in the course of their work. The decision expressly overturns the Board's 2007 Register Guard decision. The Board provided a narrow exception in the decision, but stated that the exception's use will be "rare." Purple Communications, 361 NLRB #126 (December 11, 2014).

Labor unions continue to challenge the 2012 Michigan right-to-work law in pending cases in state and federal courts. The legality of that Michigan law recently received an indirect boost from the Indiana Supreme Court, which upheld the 2012 Indiana right-to-work law that is very similar to the Michigan law.

The Internal Revenue Service has recently announced cost-of-living adjustments applicable to dollar limitations for retirement plans (and other items) for 2015. Many of the retirement plan limitations will change for 2015 because the increase in the cost-of-living index met the statutory thresholds that trigger their adjustment. However, other limitations will remain unchanged because the increase in the index did not meet the statutory thresholds that trigger their adjustment.