Monday, March 19, 2018

Does the Clean Water Act Apply to Groundwater?

Originally published by tiffany.dowell.

If a person discharges a pollutant from a point source into groundwater, and that pollutant then reaches a “Water of the United States” as defined under the Clean Water Act, is a discharge permit required?  

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Friday, March 16, 2018

Top 10 from Texas Bar Today: An RFP, the ADA, and the Y Generation

Originally published by Joanna Herzik.

To highlight some of the posts that stand out from the crowd, the editors of Texas Bar Today have created a list from the week’s blog posts of the top ten based on subject matter, writing style, headline, and imagery. We hope you enjoy this installment.

10. Including Your Pet in Your Texas DivorceNavarrete & Schwartz, P.C. in Midland

9. Be an Einstein. Use the Library. – Librarians at the Harris County Law Libary @HCLawLibrary in Houston

8. Recruiting and Retaining the Y GenerationCordell Parvin @cordellparvin of Cordell Parvin LLC in Dallas

7. Lack of Proof Dooms Pugh Clause DefenseCharles Sartain of Gray Reed & McGraw, P.C. @GrayReedLaw in Dallas

6. Exploring the Influential Trade Secrets Case of Waymo v. UberThe Kumar Law Firm PLLC in Austin

5. Fifth Circuit Resolves Split with Other Circuits on Standard of Review – Haynes and Boone Benefits Group of Haynes and Boone, LLP @haynesboone

4. Employees are ALSO Required to Engage in the Interactive Process Under the ADASeyfarth Shaw LLP @seyfarthshawLLP

3. Fear of Future Disability Actionable Under ADA?William Goren of William D. Goren, J.D., LL.M., LLC

2. Surface Use at the 5th CircuitRobert Woods of Yetter Coleman LLP in Houston

1. So, You Received An RFP. Now What? of Muse Communications, LLC @MuseCommLLC

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Fifth Circuit Resolves Split with Other Circuits on Standard of Review

Originally published by Haynes and Boone Benefits Group.

Generally, when discretionary authority is delegated to the plan administrator of an ERISA plan, a court reviewing the denial of a benefits claim is limited to determining whether the plan administrator abused its discretion in denying the claim. In a prior seminal case, Firestone Tire & Rubber Co. v. Bruch, the U.S. Supreme Court held that, when there is no delegation of discretionary authority, a denial of benefits is to be reviewed de novo (i.e., without deference to the plan administrator’s previous decision). The U.S. Court of Appeals for the Fifth Circuit (whose jurisdiction includes Texas, Louisiana, and Mississippi) interpreted Firestone to only require de novo review of a denial of benefits based on an interpretation of plan language, but not denials based on factual determinations. The Fifth Circuit recently overturned its longstanding precedent in order to bring its interpretation of Firestone in line with eight other federal circuit courts – the de novo standard of review applies to both legal and factual determinations when there is no delegation of discretionary authority under the plan. Employers should continue to ensure that their plan documents properly allocate discretionary authority to the plan administrator to ensure that a court would use a discretionary standard to judicially review a plan administrator’s benefit claim denial.

Ariana M. v. Humana Health Plan of Texas, Inc., No. 16-20174 (5th Cir. Mar. 1, 2018)

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March 16, 2018 Weekly Round Up

Originally published by tiffany.dowell.


It’s been a busy week for me and for agricultural law!  On Wednesday I spoke in Albany, Texas at a program hosted by the Leon Bosque RC&D and on Thursday evening I was in Brownwood to speak at the Brown County Ag Day.  Welcome to those of you joining from those events.

Here are some of the ag law stories in the news this week.

* FMCSA Extends Agricultural Exemption to New Hauling Regulations Another 90 Days.  The Federal Motor Carrier Safety Administration (FMCSA) announced that it will extend the current waiver of the new hauling rules related to hours of service another 90 days, extending the waiver period through June 18, 2018.  This means that the new regulations related to hours of service and electronic logging devices will not apply to people hauling agricultural commodities, supplies, livestock, or horses.  The waiver does not apply to the rules regarding Commercial Drivers Licenses (CDLs) for agricultural haulers.  [Read announcement here.]

* Proposed $1.51 Billion Settlement Announced in Syngenta Litigation.  Plaintiffs in the litigation pitting corn farmers against Synegnta involving genetically modified seeds containing the trait MIR-162 have filed a motion for preliminary approval of a settlement agreement.  [Read Motion here.]  Because the cases filed were class actions, any settlement must be preliminarily approved by a court, then notice and an opportunity to object or opt out is given to all class members, then a fairness hearing is heard, and a judge must decide whether to grant final approval.  The proposed settlement would include all farmers, grain elevators, and ethanol facilities who have offered corn for sale between 9/15/2013 and the date of preliminary settlement approval (which has not yet occurred.)  I will have a full blog post discussing this settlement in the coming weeks.

* Report that Congress has “found a fix” for the co-op issue in tax reform bill.  Lawmakers say they have “found a fix” for an issue in the recent tax reform act that gave an “unintended advantage” to cooperatives.  Under the tax law as passed, Section 199A allows farmers to deduct 20% of gross sales to cooperatives, but only 20% of net income if they sell to another purchaser.  Legislators intend to include the amendment in the omnibus spending bill.

* Planning checklist for parents of children with special needs.  I came across a blog post last week written by an Idaho attorney offering a checklist with regard to long-term planning for parents of children with special needs.  This is such an important issue for all parents, but especially for those parenting kiddos with special needs.  [Read checklist here.]

*Reading, understanding dairy contracts is imperative.  Indiana-based attorney Todd Janzen was recently interviewed for an article focusing in milk supply contracts in the dairy industry.  Todd did a great job of outlining major issues that should be considered before entering a milk supply contract.  [Read article here.]  Todd also did a webinar on dairy supply contracts, and you can listen in on that recording here.

Programs Next Week

Next week I will be in Ft. Worth for the Texas & Southwestern Cattle Raisers Convention.  It is always a great program and my husband and I are looking forward to making the trip and attending the Convention!  I’ll be speaking twice on Friday.  First, from 9:30am to 12 noon, Jim Bradbury, James Decker, Kyle Weldon, and I will be hosting the Ask an Ag Lawyer session.  Second, I’ll be presenting on grazing and agricultural leases at 3:30pm.  Look forward to seeing you all there!  For more information, click here.  As always, you can see a list of all my upcoming programs by clicking here.


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Lack of Proof Dooms Pugh Clause Defense

Originally published by Charles Sartain.

There are specific requirements for proving that an oil and gas lease has survived past its primary term. Fail to hit them all when the lease is challenged at the courthouse, wand disappointment will be order of the day.

The heart of the dispute in J&L Oil Company v. KM Oil Company was whether plaintiff J&L satisfied the requirements of a Pugh clause in a 1951 lease. J&L sued KM for impinging upon J&L’s lease on 55 acres in Caddo Parish, Louisiana. Summary judgment in favor of KM, the alleged impinger, was affirmed.

The case turned on whether J&L’s affidavits established facts sufficient to prove that wells on the lease had produced in paying quantities from the time they were drilled.

Five wells were drilled under the 1951 lease within a certain time period required by the Pugh clause (referred by the court as such. It looks more like a hybrid Pugh clause and continuous development obligation). KM owned a 2008 lease on the property covering 2,000 to 2,500 feet and had drilled wells under that lease.

The burden of proof

J&L invoked the Pugh clause. To prevail, J&L needed prima facie evidence that it satisfied the requirements of the Pugh clause, which was a resolutory condition. (If an obligation in a contract may be immediately enforced but will come to an end when an uncertain event occurs, the condition is resolutory.) When any of the five wells failed to produce in paying quantities, the condition was triggered, reducing the acreage held by the lease to five-acre squares around producing wells.

Doomed by lack of evidence

J&L submitted affidavits by its pumper Courtney to establish that the 1951 lease had been maintained by production. The affidavits were not sufficient to be the proof that J&L needed.

The Courtney affidavits didn’t state when the five wells were drilled and didn’t show constant production. Thus, J&L didn’t provide a material and essential fact that the required wells had constantly produced in paying quantities since 1951. The KM wells impinged on the 1951 lease only if the wells drilled under that lease had constantly produced in paying quantities. The Courtney affidavits did not establish that fact.

And other rulings on the evidence

Incidentally, the court noted that the acknowledgment by the lessors in the 2008 lease that the 1951 lease was in effect was insufficient proof that all the wells had constantly produced in paying quantities since being drilled. That acknowledgement appears to be an unsubstantiated conclusion.

And KM’s affidavit from McCormick summarizing conclusions from a review of Office of Conservation records was accepted. The court rejected J&L’s argument that the affidavit was not reliable because McCormick was not deemed an expert.

 A Louisiana case deserves a full dose of the King of Zydeco.

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Another Federal Court Victory For LGBTQ Rights

Originally published by Meredith L. Kaufman and Melissa Logan.

On the heels of the Second Circuit’s decision that sexual orientation discrimination violates Title VII, advocates for LGBTQ rights scored another victory in federal court. On March 7, 2018, the Sixth Circuit unanimously ruled in EEOC v. R.G. & G.R. Harris Funeral Homes, Inc. that discrimination on the basis of transgender and transitioning status violates Title VII’s prohibition on sex-based discrimination.


The EEOC brought suit against a funeral home for firing an employee after she disclosed that she would be transitioning from male to female and would dress as a woman at work. The funeral home claimed that allowing the employee to dress as a woman would violate the Religious Freedom Restoration Act (RFRA), which prohibits government enforcement of a religiously neutral law (here, Title VII) if that law substantially burdens the individual’s religious exercise and is not the least restrictive way to further a compelling government interest. Although the district court found direct evidence to support a sex–but not transgender–discrimination claim, the court nevertheless granted summary judgment in favor of the funeral home based on its RFRA defense. Specifically, the court narrowly defined the EEOC’s compelling interest to be ensuring the employee “was not subject to gender stereotypes in the workplace in terms of required clothing at the funeral home,” and found that a gender-neutral dress code would have been a less restrictive way to achieve that interest.

Reversing the district court, the Sixth Circuit found that Title VII protects against transgender and transitioning status discrimination, which “necessarily entails discrimination on the basis of sex.” The Court rejected the funeral home’s RFRA defense, finding that neither customer preferences nor the potential violation of the funeral home owner’s religious beliefs constituted a substantial burden to religious exercise. This determination alone was enough to reverse the district court’s decision. Yet in the interest of “completeness,” the Court further concluded that the EEOC has a broad compelling interest in eradicating and remedying workplace discrimination, a goal that cannot be achieved by anything less restrictive than enforcing Title VII.

The Sixth Circuit’s opinion relies heavily on the analysis of the Second Circuit and Seventh Circuit in two recent cases holding that Title VII prohibits sexual orientation discrimination. With three federal appellate courts now recognizing sexual orientation or gender identity as a protected under Title VII, it seems even more likely that the tide is changing, at least in the federal courts, regarding LGBTQ protections. Employers in all states, particularly those in the Sixth Circuit (Michigan, Kentucky and Ohio), should ensure their employment policies and practices conform with the continued developments in this area of law.

For more information, please contact your Baker McKenzie lawyer.

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Changes to patent law and possibilities for future change

Originally published by Adam Faderewski.

Changes in patent law over the past five years have created some relief in the number of cases filed but big problems remain.

Colleen Chien, a law professor at Santa Clara University School of Law; Evan Engstrom, executive director of Engine; U.S. Rep. Darrell Issa, a member of the House Judiciary Committee and chairman of the Subcommittee on Courts, Intellectual Property, and the Internet; and Ruben Rodrigues, an intellectual property trial attorney and senior counsel to Foley & Lardner, comprised a panel that discussed the “Persistence of Patent Trolls in Tech” at SXSW in Austin.

The panel discussed some of the changes to patent law and suggested changes to patent law that could deter frivolous lawsuits.

Changes to Patent Law
The Leahy-Smith America Invents Act’s central provisions went into effect on September 16, 2012, and on March 16, 2013. Rodrigues said the act is “much quicker and cheaper than the previously available methods for validating patents.”

But the act isn’t perfect, Rodrigues said, “It’s still very expensive. The final fee alone is almost $50,000 to get the thing going and the attorneys’ fees can range from being $150,000 to $500,000 depending on the complexity of the matter.”

Supreme Court decisions in Octane Fitness v. Icon Health & Fitness in 2014 and Highmark v. Allcare Health Management System in 2014 changed the “exceptional case” definition under the U.S. Patent Act’s fee-shifting provision.

After Octane and Highmark decisions, “exceptional” was defined as “a case that sets out from others or stands out from others,” Rodrigues said.

Even with the change, Rodrigues said there has been little increase in fee-shifting provisions in patent cases. Chien said the fee-shifting provision might be too difficult of a culture shift for the U.S. as compared to countries with regular rates of compensation in place.

The panel also referenced Rule 11 of the Federal Rules of Civil Procedure as a way to possibly have litigation labeled as frivolous. Rodrigues said, “it is, however, a gruesome process because of the back and forth that goes on and at the end of the day the judge has to entertain a motion for sanctioning.”

Another change was a result of the 2014 Supreme Court ruling in Alice Corporation v. CLS Bank International, where “the Supreme Court struck down one patent for claiming an abstract idea,” Rodrigues said.

A Supreme Court order in 2015 abrogated Rule 84 of the Federal Rules of Civil Procedure and thus eliminated Form 18. Rodrigues said before the changes “it used to be that there was a form for a patent complaint and it was very basic. If you complied with the form, you basically met your obligations to file a suit. So courts wouldn’t dismiss a lawsuit, no matter how bare bones the pleading was, if it complied with Form 18.”

In 2017, the Supreme Court issued a decision in TC Heartland v. Kraft Food Groups Brand. “You can only sue someone for patent infringement where they’re incorporated or where they have a place of business and have committed acts of infringement,” Rodrigues said.

The decision affected the U.S. District Court for the Eastern District of Texas, which had been a hot bed of patent litigation because plaintiffs did very well there, Rodrigues said. The “stats as of two years ago, the win rate of plaintiffs was above 80 percent, whereas the national average was 40 percent.”

Rodrigues also identified other trends that have reduced patent litigation, including “the willingness of courts to entertain early summary judgment [and] a willingness of large companies to fight trolls to discourage copycat suits.”

Trolls Change Tactics
With larger companies now showing a willingness to combat patent trolls, there has been a change in demand. “Now they ask for $50,000 rather than ask for a million dollars, and that’s been my experience in practice,” Rodrigues said. “They’re not going after large companies, but they continue to be very active in going after small and medium companies getting these ‘nuisance value’ settlements.”

Proposed Changes
Loser Pays system. A possible solution to frivolous patent lawsuit would be the “Loser Pays” system where the idea is that the losing parties in the suit pay the winners’ legal expenses, including attorneys’ fees.

Engstrom said he doesn’t see the loser pay system as a solution for the problems startups face in battling patent trolls because startups are really capitally strained.

“Even the notion of having a loser pay system may not work if your decision point is ‘do I pay $3,500 and wash my hands of this or take a loan out to finance litigation that is going to cost up to $6 million even if it’s a 95 percent chance that I’ll win?’ Really, it’s about preventing these things from happening in the first place.”

Cheaper court costs. A common tactic of patent trolls is to offer a “nuisance cost” to settle lawsuits. The nuisance cost is a fee that the troll knows will be less than the cost of litigation.

The most impactful changes to patent law have been around “the introduction of cheaper alternatives to litigation, such as inter partes review, which is still expensive,” Chien said. “I think this is an indictment of our court system that’s so expensive, so cumbersome, that we’ll try to go around by going to the PTAB [Patent Trial and Appeal Board].”

The notion of inter partes review, or IPR, is highly contested, Chien said. In fact, a current Supreme Court case, Oil States Energy Services v. Greene’s Energy Group, is challenging whether IPR violates the Constitution by removing private property rights through a non-Article III forum without a jury.

Compulsory Licensing Act. “One of the first things that may end up in the long run happening is more situations like the famous IBM case, where IBM was forced to license their patent portfolio because they had effectively locked out—in perpetuity—anyone from making an effective computer simply because by the time you’d get to use their patents it would be useless,” Issa said.

Although, there may be certain circumstances where compulsory licensing is necessary for the continuance of innovation, Issa said.

All of the changes aimed at controlling patent controls may have an undesired effect though, said Chien. “Now there’s a lot of concern in the patent community that the pendulum has swung too far in a direction that sort of devalued patents.”

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