Friday, November 30, 2018

Do Not Be Fooled — Misleading Solicitations Regarding Your Trademarks

Originally published by Alicia Groos.

Misleading trademark solicitations are becoming an epidemic. Trademark owners beware!

If you have registered a U.S. federal trademark, you may know that you must periodically make certain filings to maintain or renew your registration. For most post-registration maintenance filings, there is a one-year window in which to make the filing and a six-month grace period following the deadline. Nevertheless, unscrupulous companies are sending out misleading notices and invoices which scare trademark owners with statements such as:

Your trademark is about to expire. Sign and return this document to renew your trademark.

The notice or invoice may look official and display all the information for your trademark—the registration number, date, etc. It will likely be addressed from the “Patent & Trademark Office,” or “Trademark Bureau,” or some other official-sounding office. But many of these notices are scams! Often the “deadline” is not a deadline, but in fact the opening of the window in which the trademark owner is able to take action to maintain the trademark, with the real deadline falling a year or more later. Or the solicitation might be for publication of the trademark in an private and unnecessary database or registry.

Somewhere in the fine print, the notice may explain that the sender is not actually a government agency, but sometimes it is difficult to determine. If you worked with a law firm or an attorney to register your trademark, you may wish to contact your attorney to verify any deadlines and to confirm whether the notice is legitimate, especially before you pay any money. Many attorneys maintain a docketing system and will send reminders to their clients at the appropriate time.

The United States Patent and Trademark Office provides a warning list of misleading solicitations, with images of each scammer’s typical letters, on its website. The growing list has at least 50 known offenders. As it explains on that page, “All official correspondence about your trademark application or registration will be from the “United States Patent and Trademark Office” in Alexandria, Virginia, and all emails will be from the domain ‘@uspto.gov.’” Be wary of any official-looking communication or notice that does not come from the USPTO.

For international trademark filings, the World Intellectual Property Organization (WIPO) “Warning” page, provides examples of similar solicitations for international registrations.

If you have received a trademark-related solicitation or notice that you think is a scam, or if you have paid one of these companies for unnecessary services, you may also wish to submit a consumer complaint to the FTC. Or contact your state consumer protection authorities for help.

The post Do Not Be Fooled — Misleading Solicitations Regarding Your Trademarks appeared first on The Brand Protection Blog.

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Debunking Common Misconceptions About Appeals

The Celebrated Gopher Frog of Southern Mississippi

Originally published by David Coale.

The dusky gopher frog returns to the Fifth Circuit; the Supreme Court has reversed a decision about judicial review of the Fish & Wildlife Service’s treatment of the endangered frog’s habitat, reached after a close denial of en banc review. In the meantime, the Fifth Circuit’s makeup has materially changed in ways that likely predispose the full court toward a different view of the underlying administrative-law issues.

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Texas’ newest attorneys sworn in

Originally published by Eric Quitugua.

The Texas Supreme Court and State Bar of Texas welcomed newly licensed attorneys at the New Lawyer Induction ceremony November 19 at the Frank Irwin Center in Austin.

Members of the Texas’ highest courts, deans from the state’s law schools, State Bar and Texas Board of Law Examiners officials, and friends and family watched as hundreds of law school graduates took the Lawyer’s Oath Monday morning.

State Bar of Texas President Joe K. Longley congratulated the freshman lawyers, telling them they are now part of an institution dedicated to providing leadership and pro bono opportunities and advancing the rule of law through equal access to justice. The power granted to them by their law license, he said, is a vast one that should not be abused.

As an example of that power, Longley told a story involving well-known atheist and activist Madalyn Murray O’Hair, who was arrested and jailed in San Antonio. She relied on help from American Civil Liberties Union attorney and former Texas Representative Maury Maverick Jr.

“Upon Maury Maverick Jr. making his appearance, Madalyn Murray O’Hair quickly exclaimed, ‘Maury, thank God you’re here,’ and as a result, you have a demonstration of what this piece of paper—the power that it gives to you,” he said.

Longley left the new attorneys with two pieces of advice: The oath they took goes beyond business hours and sticks with them for the rest of their lives, and reputations—which can easily be lost because of negligence or recklessness—must be protected.

Sally Pretorius, president of the Texas Young Lawyers Association, echoed Longley’s remarks, reminding graduates that their reputations precede them. She also gave them advice on taking advantage of misconceptions about new lawyers:

“I think that being underestimated is one of our biggest strengths as young attorneys,” Pretorius said. “Nobody expects us to show up and know what we’re doing. I can’t tell you how many times I’ve shown up for a hearing and won against a 30-year board-certified attorney because I was more prepared. I’d taken the time to search Facebook for that one piece of evidence that was going to win a family law case. Or taken the time to get to know my client’s story because I am a young attorney and I have a little bit more time.”

She also gave practical advice on taking care of health and temperament, encouraging new lawyers to do simple things like go outside for lunch or go for a walk to Starbucks for coffee. On handling stress and anger at work:

“Type that angry email, then hit delete, and re-type again a couple minutes later, Pretorius said. “That angry email—it’s going to exist for a long time.”

The Bar Exam’s high scorer, Baylor Law School graduate Stephen Burbank, gave a light-hearted and humble speech, acknowledging the only separation between him and the rest of the graduates was “just a couple points on a test.”

He told the new lawyers how he prepared for his speech, looking back at those by previous high scorers. The format, Burbank said, seemed to be a joke on being nervous in front of crowds, thanking people who helped along the way, and words of wisdom. He then told a joke of his own.

“What is the difference between a good lawyer and a bad lawyer? A bad lawyer can let a case drag on for several years. A good lawyer can make it last even longer.”

Burbank then thanked his wife, parents, in-laws, relatives, friends from Baylor, Judge Alan Albright (for whom he clerked), and his co-clerks before congratulating everyone who passed the Bar Exam.

“Let’s go out and show everyone how awesome Texas lawyers can be,” he said.

Before Texas Supreme Court Chief Justice Nathan L. Hecht administered the oath, he told the graduates that in raising their hands, they swear to support the U.S. and Texas constitutions, to honestly demean themselves in practice, to discharge their duties to clients to the best of their abilities, and to conduct themselves with integrity and civility.

“From this day forward, you are the voice and the instrument for the rule of law,” he said. “You therefore have a special responsibility not only to whom you represent but to our profession and our great experiment in democracy.”

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Why Did the Girl Scouts Sue the Boy Scouts? Scouts BSA

Originally published by Claudia Alvarado.

The times are ever evolving and with it, so are the Boy Scouts of America. After over a century in existence, they’ve decided to open […]

The post Why Did the Girl Scouts Sue the Boy Scouts? Scouts BSA appeared first on Klemchuk LLP.

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How Will US Eminent Domain Law Change During Texas Population and Economic Growth?

Originally published by Luke Ellis and Justin Hodge.

 

In booming, growing Texas, an inherent tension exists between the government’s need to build and expand public infrastructure and the need to protect
      

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Tips for How to Make the Best of Rest Time and How to Know You Need It

Originally published by Angela Morris.

 

Texas law students yearning for rest and relaxation will get a chance later this month, but winter break isn’t just a time for leisure.To make
      

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Wildfire Considered One Occurrence Despite Damaging Numerous Properties

Originally published by Christina Phillips.

A recent decision by the Supreme Court of Wisconsin1 might predict how other courts would analyze coverage under commercial general liability insurance policies for wildfires. In May 2013, a fire broke out on forest land owned by Lyme St. Croix Forest Company. The fire burned nearly 7,500 acres over the course of three days and…… Continue Reading

.

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You Had Me At “Class Action Waiver”

Originally published by Michael E. Brewer, Michael Leggieri and Robin Samuel.

As we previously discussed here, the United States Supreme Court’s May 2018 decision in Epic Systems v. Lewis was a clear win for employers that seek to avoid the expense and disruption of class litigation by resolving disputes individually through binding arbitration. As explained by the Supreme Court in AT&T Mobility LLC v. Concepcion, “[i]n bilateral arbitration, parties forego the procedural rigor and appellate review of the courts in order to realize the benefits of private dispute resolution: lower costs, greater efficiency and speed, and the ability to choose expert adjudicators to resolve specialized disputes.”

For employers looking to take advantage of the benefits of individual arbitration, there are several drafting nuances to consider before rolling out or updating existing arbitration agreements.

 

You complete me. 

First and foremost, employers who are continuing to use arbitration agreements that are silent on class or collective arbitration should consider including an express class waiver in their agreements. Notwithstanding the Supreme Court’s statement that “the parties’ mere silence on the issue of class-action arbitration” does not signify assent, Stolt-Nielsen S.A. v. AnimalFeeds, Int’l Corp., agreements that do not explicitly state that class or collective proceedings are impermissible leave the issue open to differing judicial interpretation, and may cause what many consider the worst of all worlds—claims being subject to class-wide arbitration. To remove any doubt, employers should consider including an explicit class action waiver.  In other words, show me the class action waiver!

Help me help you.

Besides an explicit class action waiver, here are several other drafting tips that employers choosing to use arbitration agreements in California should consider:

  • Specifically provide that the Federal Arbitration Act governs the parties’ arbitration agreement. The FAA mandates that courts enforce arbitration agreements according to their terms, including terms that preclude class proceedings, notwithstanding state laws or policies to the contrary. Although a reference to the FAA is not required, it will clarify that the parties intend the FAA to govern their agreement, and not another statutory scheme (such as the California Arbitration Act) that may not provide for the same enforcement of class action waivers.
  • Specifically state that a court, and not an arbitrator, will determine whether an arbitration agreement permits the possibility of class arbitration. Absent contractual language that assigns this question to the court or the arbitrator, the presumption of “who decides” varies by jurisdiction. The majority of federal courts (including the Third, Fourth, Sixth, Seventh, Eighth, and Eleventh Circuits) have determined this is presumptively a gateway issue for the courts, but the California Supreme Court has held that it is presumptively an issue for the arbitrator to decide, and other courts have not yet spoken on this issue. To remove any ambiguity and the risk of differing judicial interpretation, arbitration agreements should expressly state that a court, and not an arbitrator, will determine whether an agreement permits the possibility of class-wide arbitration.

From help designing your company’s arbitration program, please reach out to your Baker McKenzie employment lawyer.

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Thursday, November 29, 2018

Court Approves Will Drafted for Quadriplegic Who Could Only Blink Answers to His Lawyer’s Questions

Originally published by John Council.

 

Fort Worth’s Second Court of Appeals has validated a will that was drafted by an attorney in an unusual manner—his client was a quadriplegic, unable to speak, and could communicate with the lawyer only by blinking “yes” or “no” to questions.
      

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Multitask Your Legal Marketing

Originally published by Amy Boardman Hunt.

Now that we’re well and truly in the holiday season – the one that exhausts and delights in equal measure – it’s a good time to take a deep dive into one of my favorite timesavers: marketing multitasking. Some of us have a hard time saying no. That’s how I ended up with two Girl […]

The post Multitask Your Legal Marketing appeared first on Muse Communications.

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“Don’t Rush to Failure” — Why Company Policies Come First

Originally published by Mary Harokopus.

 Photo by Enrico Mantegazza on Unsplash

Photo by Enrico Mantegazza on Unsplash

I am often asked to update a company’s handbooks, contracts, and policies, or to prepare these important documents when none existed. Unfortunately, the first test of the enforceability and utility of these writings comes at the worst possible time for the employer – when needed to justify and support a termination or, even worse, in litigation. When a company is just starting out, there are so many moving pieces to get the business off the ground that, by necessity or inattention, the documents dictating important relationships go by the wayside. Sometimes new business owners will resort to short cuts like searching the internet for something that seems to fit. However, it is often unclear where the language in these documents came from, which state and federal laws apply, and whether the document takes account of changes in authorities such as statutes or administrative regulations. Regrettably, the business owner will generally only discover these issues when the documents become critically important – too late in the game.

Careful preparation of your contracts and policies allows you to think through these questions proactively. For example, one way of drafting may dictate where any litigation occurs – preferably in your preferred courts – whereas another leaves room for the other side to choose where and how to bring a case. With that in mind, here are some points to keep in mind:

  1. CONSIDER INCLUDING VENUE AND FORUM PROVISIONS IN YOUR CONTRACTS AND USING ARBITRATION AGREEMENTS FOR YOUR EMPLOYEES. Including a dispute resolution process in your employee agreements affords you notice before things get out of hand, and can solidify your position by allowing you to determine when, how, and where matters get brought before a court. Additionally, language requiring notice of claims, or requiring that you have the opportunity to cure any alleged issues, can potentially save a relationship before things become irreconcilable.
  2. INCLUDE NOTICE AND OPPORTUNITY TO CURE PROVISIONS IN YOUR CONTRACTS WITH VENDORS AND BUSINESS AFFILIATES. Similarly, with regard to your vendors and other contracted parties, a robust dispute resolution process can require not only advance notice, but resolution opportunity steps before launching into costly litigation. Advance notice can allow you to get in front of potentially problematic terminations. A jury waiver or arbitration clause can be imposed to lessen the damages potential of a jury verdict, and place decisions in the hands of a former judge or attorney who may be better able to understand the legal issues involved.
  3. CAREFULLY REVIEW THE CLAUSES IN YOUR EMPLOYEE HANDBOOK. Your company handbooks is your employee’s first experience with understanding how you want to run your business. How lenient do you want to be with absenteeism, or is it critical to your business that your employees show up on time and provide advance notice of absences? Do you want to pay out unused vacation when an employee quits? Do you want the option to withhold pay if an employee leaves owing money? What kind of disciplinary policies do you want to implement? These very important questions can be addressed in a well written and considered handbook. From a practical perspective, these policies will come into play when you terminate an employee and they seek unemployment. The availability of unemployment benefits for a terminated employee can depend on whether there was a policy in place to address the conduct at issue, and whether you provided warnings prior to the termination. Therefore, to manage your unemployment claims, it is important to address in writing conduct that will constitute grounds for termination. It is also important that the employee understand those grounds in order to adjust conduct accordingly.

In the bustle of starting or scaling a business, remember the phrase “don’t rush to failure.” Careful planning at the early stages may pay dividends for years to come, providing a solid foundation on which to build your vision.

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8th Circuit Agrees, Request for Religious Accommodation is not Opposition Conduct

Originally published by Seyfarth Shaw LLP.

By Dawn Reddy Solowey and Latoya R. Laing

Seyfarth Synopsis: The 8th Circuit recently held that while a request for a religious accommodation  may qualify as a protected activity, it is not necessarily “oppositional” so as to give rise to an opposition-clause retaliation claim until Title VII. Employers considering requests for religious accommodation should, despite this Circuit’s narrow decision, proceed carefully when considering any request.

Last year we blogged about a Minnesota District Court’s decision holding that a religious accommodation request did not constitute a protected activity under Title VII. The plaintiff appealed the ruling.  On November 13, 2018, the Eighth Circuit Court of Appeals affirmed, holding that it could not “categorically” resolve whether a request for religious accommodation is oppositional activity for a retaliation claim, but that it would affirm the ruling for the employer on the summary judgment record in this case.

Case Background

The case is EEOC v. North Memorial Health Care, Civ. No. 17-2926 in the U.S. Court of Appeals for the Eighth Circuit. The Equal Employment Opportunity Commission (EEOC) sued the employer hospital, claiming that the employer had retaliated against an applicant by withdrawing a conditional job offer because she asked for a scheduling accommodation for her religious beliefs as a Seventh Day Adventist. On March 15, 2017, the employer moved for summary judgment. The employer argued that the retaliation claim failed on grounds including that a religious accommodation request did not amount to protected activity as a matter of law. The District Court agreed, granting summary judgment in favor of the employer.  The EEOC appealed, joined by amicus curiae that included the American Civil Liberties Union (ACLU).

What Did the Court Rule?

The 8th Circuit explained that it was considering an “issue of first impression,” namely whether “requests for religious accommodation are protected activity under Title VII’s anti-retaliation provision.”  The Court held that “the issue cannot be resolved categorically,” but affirmed the district court’s ruling on the summary judgment record in this case, holding that the applicant’s simple request for a religious accommodation was not “oppositional” activity as required for Title VII retaliation claims.

Title VII makes it unlawful for an employer to discriminate against an employee or an applicant for employment because the employee opposed an unlawful employment practice. To establish a prima facie case of retaliation, the EEOC was required to show that the applicant opposed an unlawful practice.

The Court relied on the Supreme Court case Crawford v. Metro. Gov’t of Nashville and Davidson Cty. 555 U.S. 271 (2009), emphasizing that when an employee communicates to the employer a belief that the employer had engaged in discrimination, that communication almost always constitutes the employee’s opposition to the activity.

However, in this case, the Court held that the applicant’s actions were not oppositional because “merely requesting a religious accommodation is not the same as opposing the allegedly unlawful denial of a religious accommodation.”

While the Court generally construes the statute “broadly to cover opposition to employment actions that are not unlawful,” the plaintiff’s request for religious accommodation, by itself, “did not reflect, much less communicate, any opposition or resistance to any North Memorial employment practice.”

The Court explained that at least for religious accommodation claims, “protected activity” is not always “oppositional activity.”  The Court held that in some circumstances, a religious accommodation request could form the basis for a retaliation claim, such as if an employer denied an accommodation on the grounds that it was not in fact based on a religious practice and fired the employee for making the request.  However, when the employee or applicant requests a religious accommodation, and the request is denied on the grounds that it cannot reasonably be accommodated absent undue hardship, there is no basis for an opposition-clause retaliation claim.  Instead, the employee or applicant’s exclusive claim is a disparate impact or disparate treatment claim under Title VII.

Finally, the Court noted that the applicant’s original EEOC charge had included a claim of disparate treatment.  However, the EEOC’s enforcement action alleged only unlawful retaliation.  Thus, while the Court held that the applicant’s “Title VII remedy as an unsuccessful job applicant was a disparate treatment claim under [the statute] for failure to reasonably accommodation,” there was in this case no disparate-treatment claim before the Court.

What Does This Case Signal for Employers Defending Retaliation Litigation?

In defending a retaliation claim, an employer should consider whether, in the relevant jurisdiction, there is a viable argument in its jurisdiction that a request for religious accommodation is not sufficient to establish protected activity as a matter of law.  This issue was one of first impression in the Eighth Circuit, and different courts are likely to reach different conclusions.  As always, it is important to keep in mind that the law governing retaliation claims under Title VII may differ from that under state and local laws.

What Does This Case Signal for Employers Managing Accommodation Requests?

Employers should follow a conservative approach in responding to religious accommodation requests.  Employers would be wise to assume — until there is settled, binding law to the contrary in the relevant jurisdiction on identical facts  — that a request for religious accommodation may be construed as protected activity under Title VII.  As a practical matter, this means that an adverse action that an employer takes against an employee, and that post-dates a religious accommodation request from the employee, may be challenged as retaliatory by the employee and/or the EEOC.  Further, an unlawful denial of a religious accommodation request can give rise to a disparate-treatment discrimination claim, even if there is no available retaliation claim.

Best Practices for Responding to Religious Accommodation Requests

Best practices for employers to respond to religious accommodation requests, and minimize the risk of retaliation liability, include:

  • Set up a policy and process for managing religious accommodation requests in a manner that is consistent and compliant with the jurisdiction’s law. Ensure that managers and HR are trained in the policy and process, and that employees know how to request a religious accommodation.
  • Review each religious accommodation request individually on a case-by-case basis. You can read our Roadmap for Responding to a Request for Religious Accommodation here. Given the complexities of this area of the law, it is wise to enlist the help of counsel who specializes in this area.
  • Ensure that any adverse actions taken against an employee, including those subsequent to a religious accommodation request, are based on legitimate, non-discriminatory and non-retaliatory reasons, and that the business reasons for those adverse actions are well-documented.

For more information on this topic, please contact the authors, your Seyfarth Attorney, or any member of the Firm’s Absence Management and Accommodations Team.

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Approaching Your First Law School Final Exam

Originally published by Academic Support.

Treat your first law school final exam as an opportunity to show your excellence in thinking and writing like a lawyer. Here are some guidelines for the coming weeks. Put together the final pieces: Learn your professors’ individual preferences. Should…

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U.S. Court of Appeals for the Fourth Circuit’s Decision to Vacate Mountain Valley Pipeline Nationwide Permit

Originally published by Energy Legal Blog ®.

On November 27, 2018, the U.S. Court of Appeals for the Fourth Circuit issued the most recent in a series of decisions from various courts affecting the federal permitting and construction of interstate pipelines. Sierra Club v. U.S. Army Corps of Engineers, No. 18-1173 (4th Cir. Nov. 27, 2018). In this instance, the Circuit held that the U.S.

Ann Navaro, Christine Wyman
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Music Law for PRO’s

Originally published by Charles Wallace.

 Photo by NeONBRAND on Unsplash .

Photo by NeONBRAND on Unsplash.

Most everyone has attended a live music concert at one point or another (if you haven’t, you’re really missing out on a significant facet of life — get out more), but almost no one is lame enough to simultaneously consider the legal implications of what they are watching (notice I said “almost” no one). I have been attending live music concerts, theatrical and dance performances, and other “gigs” since a very early age, and I have always been fascinated by the creativity required in putting together a show. How much of the musical performance, however, really belongs to the performers (or group, company, etc.), and how much of it was taken? Moreover, how much of another’s work is allowed to be performed without permission, if at all?

I became an attorney, in part, to learn the answer to these types of questions inherent in the entertainment industry. Much to my dissatisfaction, I learned that the answer is largely “it depends” — any attorney can tell you that. However, the question of “what material is a band allowed to perform” can be answered with relative certainty, especially when it comes to a band playing another artist’s song publicly.

First, some context:

In the music industry, there are two different types of copyrights: (1) Musical Works and (2) Sound Recordings. A musical work, or simply, a “song,” is both the lyrics and music that make up the written musical composition itself. A sound recording, on the other hand, is a work made up of recorded sound. The owner of a Musical Work copyright often owns both the copyright in the song itself and the copyright in the Sound Recording of that same song (if one exists).

Among the exclusive rights granted to copyright owners in the music industry is the right to publicly perform the song (see 17 U.S.C. §106(4)) and to perform the sound recording of the song through digital transmission (see 17 U.S.C. §106(6)). For example, if a guitarist plays the all-too-familiar guitar riff to Led Zeppelin’s “Stairway To Heaven” in a public place without permission, that infringes on the band’s Musical Work copyright. Similarly, playing the band’s original recording of the song off a CD or audio track in public would infringe on the band’s Sound Recording copyright. This is where the Performance Rights Organizations (“PROs”) come in.

A PRO, like the American Society of Composers, Authors, and Publishers (“ASCAP”) and Broadcast Music, Inc. (“BMI”), licenses the public performance rights of their songwriter, composer, and producer members to users such as restaurants, bars, and radio stations. These “blanket licenses” give licensees access to a PRO’s full database of songs without licensees having to procure individual licenses from each member of a PRO and without rights holders having to solicit individual licenses to potential customers. Generally, a band does not need a license to perform a cover song live because it is the club, restaurant, or concert venue’s responsibility to obtain the necessary public performance licenses from the PROs. This does not mean, however, that the band is completely insulated from liability when publicly performing others’ songs..

Although it is the audience’s job to enjoy the musical performance, show, or concert (or in my case, to spend half my time considering the legality of what I am witnessing), it is the band’s job to make sure its performance is compliant with laws meant to protect artists from infringing and “free-riding” on others’ work. With respect to the everyday garage band, live musician, or recording artist, here are some helpful notes that may help one avoid a potential lawsuit from infringing on another’s public performance rights:

  1. Play your own material. I can’t stress this enough — this is, by far, the safest (but not always the most fun) way to insulate yourself from copyright infringement liability. You can’t infringe on your own copyrights, so create away, and play to your heart’s content (then make sure other bands aren’t using your material).
  2. Check whether the performance venue secured PRO licensing. If a venue has opted not to buy any music performance licenses from any PROs, then it might tell you that you cannot play any other band’s material (“cover” songs). In this case, try to respect this request and refer back to Note 1 above. When in doubt, ask!
  3. If necessary, purchase your own PRO license. If your show is largely comprised of others’ material, and if the venue you are performing at does not have a license, it is best practice to check with the applicable PRO to see whether they require you to purchase your own license.

These three steps only speak to performing others’ material in full and does not contemplate other types of use such as sampling, parody, and other fair use. Copyright is a complex and specialized area of the law, so it is best to revel in your own creativity and avoid using another’s work. Or consult the PROs.

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Feds Claim Protection from Sutherland Springs Liability Under the Brady Act

Originally published by Texas Personal Injury News.

The Federal government has filed a motion with the intent to dismiss several lawsuits filed against the United States Air Force by victims of the Sutherland Springs massacre. It is claiming that a law that was intended to prevent gun violence also shields them from any liability.

What Happened?

On Nov. 5, 2017, 26-year-old, Devin Patrick Kelley perpetrated the deadliest mass shooting in Texas and the fifth deadliest in the United States. It was also not surprisingly, the deadliest shooting in an American place of worship in the modern era. He opened fire inside and around the First Baptist Church in Sutherland Springs, killing 26 people and injured 20 others.

Failure to Record

Kelley, a former member of the United States Air Force, had been prohibited from purchasing or possessing any firearms due to a previous domestic violence conviction in a court-martial. However, the Air Force never filed the conviction in the FBI National Crime Information Center Database. The database serves as a tool to help the National Instant Check System to flag any prohibited purchases.

At least five lawsuits have been filed and consolidated in San Antonio federal court concerning the shooting. The suits claim that the Air Force should be held liable for its failure to report Kelley’s domestic violence conviction into the database. He had been kicked out of the military in 2014, having spent a year prior behind bars for part of a 2012 plea deal surrounding the beating of his then-wife and stepson.

The Brady Handgun Violence Prevention Act

The plaintiffs assert that Kelley would have been unable to purchase any firearms, such as the ones he bought between 2012 and 2014, and the one he used during the attack, had his conviction been in the system. The lawsuits reference the Brady Handgun Violence Prevention Act.

The government has cited a number of cases concerning the Act, claiming that the laws they reference should shield Air Force personnel from any bureaucratic mishaps. Lawyers for the Justice Department, which is currently defending the Air Force, has expressed that statutory immunity shield the United States from any liability to the plaintiffs in this case. “The federal statute on which the plaintiffs primarily base their claims (the Brady Act) expressly provides that no liability for damages may be imposed on employees of the federal government to prevent the sale of a firearm to a person prohibited by law from receiving it,” they wrote.

Watching the Brady Center to Prevent Gun Violence

It should be interesting to watch how this plays out, as the Brady Center to Prevent Gun Violence had no comment on this case, though it filed a brief in 2015 arguing against the government’s shield claim in the case of Charleston, S.C. church shooter and white supremacist, Dylann Roof. Roof shot and killed nine African-American worshippers.

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Syngenta Special Master Rejects $150M in Fees for Texas Attorney Mikal Watts

Originally published by Amanda Bronstad.

 

Special master Ellen Reisman recommended that lead counsel in Kansas get half the estimated $500 million in legal fees.
      

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Wednesday, November 28, 2018

Some Thoughts on Registration of CPA’s as Solicitors

Originally published by John C. Anjier.

For many investment advisers, CPAs are a big source of referrals. Often these CPAs are compensated for the referrals. Most states now require registration of solicitors, including CPAs, as investment adviser representatives (“IAR”). This article provides some background on these requirements.

1.  A Little Refresher

What is a solicitor? A solicitor is a person who, directly or indirectly, solicits or refers clients to an adviser. A solicitor relationship arises when an adviser pays an employee or third party for referring clients. The use of solicitors is regulated by the SEC under the Investment Advisers Act of 1940 and by the various states.

The SEC regulates the use of solicitors and imposes certain requirements. Generally, for the use of a solicitor to be lawful:

  • There must be written agreement between the adviser and the solicitor that specifies the scope of the solicitor’s activities, the solicitor’s fee and includes covenants by the solicitor to act in compliance with the law and the adviser’s instructions.
  • Solicitor cannot be subject to certain disqualifying events such as being barred or suspended by the SEC or respective state authorities, convicted of a felony, or misdemeanor relating to fraud;
  • Solicitor must provide written disclosure statement to the client.
  • Client must sign statement acknowledging the receipt of disclosure statement and the adviser’s brochure

The good news – the SEC does not require the registration of solicitors.

The bad news – most states now require the registration of solicitors as an investment adviser representative (“IAR”). Further bad news, the regulation of IARs differs among the states and advisers are wise to have their lawyer or compliance professional review the law relating to registration of solicitors and IAR’s in each state in which the adviser has operations.

2.  State Registration of Solicitors

In 2006, Louisiana defined an IAR as including an individual who “solicits, offers or negotiates for the sale or sells investment advisory services”. In 2016, Louisiana specifically required IARs to be registered and to pass a Series 65 exam or meet other third-party certifications, such as CFP, PFS, or CFA. In the same regulation, Louisiana specifically defined “Third Party Solicitor” as:

[A]n investment adviser representative who meets all of the following criteria: 1. investment advisory business consists solely of referring individuals to other investment adviser firm(s); 2. provides no advice to individuals regarding specific investments; 3. fees consist entirely of referral fees received from the investment adviser firms to whom the investment adviser representative makes referrals.

Most states include a similar definition. For example, Mississippi defines an IAR as including an individual who “receives compensation to solicit, offer, or negotiate for the sale of or for selling investment advice.” As an IAR, CPA solicitors must be registered in Louisiana and most other states (there are exemptions, see below).

Although Louisiana requires the registration of third-party solicitors, third party solicitors are exempt from the exam requirement. In contrast, Mississippi requires solicitors to take the Series 65 test

3.  Other Possible Exemptions for CPA’s as Solicitors

Professional Exemption
The SEC and most states incorporate a professional exemption for lawyers, accountants, engineers, etc. for performance of services solely incidental to the practice of his or her profession. However, the SEC and most courts have limited this exemption to providing information on broad classes of assets and the referral to a particular advisor would be outside of this definition. Moreover, if the fees paid are not consistent with customary professional fees (percentage of assets versus hourly fees), the exemption is not available. Accordingly, this exemption generally is not applicable.

De minimus Exemption
Most states have a de minimus exemption that varies from state to state. Louisiana, Florida, and Tennessee have an exemption of 15 clients in any 12-month period while Alabama and Texas have a de minimus exemptions of five clients.

Institutional Investor
Many states provide an exemption for advisers whose only clients are institutional investors. For example, Alabama includes an exemption from registration for advisers whose sole clients are banks, trust companies, insurance companies and employee benefit plans with assets of greater than $1 million. Louisiana has a similar exemption. Texas provides an exemption for individuals who are accredited investors, QIB’s and various entities with a net worth greater than $5 million. This could be used if a CPA only referred larger 401(k) and defined benefit plans for example.

Other Exemptions
A lawyer or compliance professional will need to examine the law in each state in which one intends to engage CPA’s as solicitors. Georgia, for example, exempts CPA’s from the definition of “solicitor”.

Disclaimer: This Blog/Web Site is made available by the law firm of Liskow & Lewis, APLC (“Liskow & Lewis”) and the individual Liskow & Lewis lawyers posting to this site for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice as to an identified problem or issue. By using this blog site you understand and acknowledge that there is no attorney client relationship formed between you and Liskow & Lewis and/or the individual Liskow & Lewis lawyers posting to this site by virtue of your using this site. The Blog/Web Site should not be used as a substitute for legal advice from a licensed professional attorney in your state regarding a particular matter.

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Tuesday, November 27, 2018

Music Publishers Target PokerNews Podcast For Copyright Infringement

Originally published by Peggy Keene.

Even as Congress works to pass new legislation that would address digital music licensing and streaming, record labels and music publishers are still filing mass […]

The post Music Publishers Target PokerNews Podcast For Copyright Infringement appeared first on Klemchuk LLP.

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DOL Eliminates “80/20” Tip Credit Rule

Originally published by Emily Harbison and Remi Balogun.

The Department of Labor’s newly issued opinion letter provides good news for employers who use tipped workers. On November 8th, the DOL reversed its previous “80/20” guidance on use of the tip credit. The tip credit permits employers to pay employees in tip-based positions, such as bartenders and waiters, a lower hourly wage than the federally mandated minimum wage (with the thought that earned tips will make up the difference). Under the previous “80/20” rule, employers were barred from paying the lower cash wage to tipped employees who spent more than 20% of their time performing non-tip generating duties such as setting tables or cutting lemons.

 

The previous “80/20” rule saddled employers with the unworkable burden of continually monitoring and accounting for how tipped employees spent their time. The rule sparked copious litigation about whether tipped employees’ non-tip generating duties accounted for 20% of the employees’ time. Recognizing the confusion and inconsistent application of the former rule, the DOL’s new guidance seeks to protect workers while enabling “employers to determine up front whether their actions are in compliance.”

In the opinion letter, the DOL discards the “80/20” rule and clarifies that it does not “intend to place a limitation on the amount of duties related to a tip-producing occupation that may be performed.” However, the rejection of these limits is conditioned on the duties being “performed contemporaneously with” or “for a reasonable time before or after” the employee’s direct service or tip-generating duties.

Even though the opinion letter eliminates the “80/20” rule, it maintains the dual jobs categorization, which applies where an employee takes on two positions, one a traditionally tipped role and the other a non-tipped role. Employers should still be mindful as employees engaged in dual jobs are entitled to the full minimum wage for time spent on the non-tipped job.

It remains to be seen how this new guidance will be applied, but the elimination of the “80/20” rule relieves employers of the taxing burden of monitoring and accounting for tipped employees tip and non-tip generating time.

For more, please reach out to your Baker McKenzie employment lawyer.

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The Fifth Circuit Issues Its First Decision on the Defend Trade Secrets Act

Originally published by Leiza Dolghih.

trade secrets label on folderEarlier this month, the Court ruled that: (1) a party must “prevail” before it can recover any attorney’s fees under the DTSA and (2) a plaintiff’s dismissal of its claims without prejudice does not confer the “prevailing party” status on defendants.

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Three collisions. One occurrence?

Originally published by David Coale.

A gruesome series of automobile accidents led to a fundamental question about causation and insurance coverage in Evanston Ins. Co. v. Mid-Continent Casualty Co.: “Over a ten-minute period on November 15, 2013, the insured’s Mack truck struck (1) a Dodge Ram, (2) a Ford F150, (3) a Honda Accord, (4) a toll plaza, and (5) a Dodge Charger. . . . [T]he Mack truck’s primary insurer refused to contribute more than $1 million toward the settlements of the final three collisions, claiming that they were part of a single ‘accident’ under its policy.”  Examining the reference points about this question under Texas law, the Fifth Circuit noted that:

  • Eight specific sales from one shipment of contaminated bird seed created eight separate occurrences;
  • Two fires, set by the same arsonist “several blocks and at least two hours apart,” created two separate occurrences; and
  • “[A]n HEB employee’s sexual abuse of two different children, a week apart, at an HEB store” created separate occurrences; however,
  • A flawed three-hour crop dusting that damaged the land of several neighbors created one occurrence, even though “the plane had landed several times to refuel . . . [and] the temperature, wind, and altitude varied during the several passes over different sections of thee property”; and
  • Two separate storms that damaged the same drilling rig created two separate occurrences.

Under the principles behind these cases, the Court found that the harm caused by the Mack truck’s driver created a single occurrence: “Absent any indication that the driver regained control of the truck or that his negligence was otherwise interrupted between collisions . . . all of the collisions resulted from the same continuous condition – the unbroken negligence of the Mack truck driver.” No. 17-20812 (Nov. 19, 2018).

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Texas High Court Invokes the Discovery Rule

Originally published by Charles Sartain.

In a ruling that could benefit mineral owners who don’t regularly examine county deed records (to-wit, you?) the Supreme Court of Texas in Carl M. Archer Trust No. Three v. Tregellas held that the discovery rule delayed the running of the statute of limitations on behalf of the holder of a recorded right of first refusal to purchase mineral interests.

The trustees sued the Tregellases for buying the minerals without allowing the Trust to exercise its ROFR, contending that a contract was formed when they sued more than four years after the Tregellases’ purchase; the suit was their acceptance of the right to purchase the minerals, they said.

According to the Trellgases, the claim was barred by limitations because the suit was filed more than four years after the sale. The trustees responded that even if that were so, limitations should be delayed because they they had no obligation to search the county deed records.

The discovery rule described …

The rule defers accrual of a cause of action until the plaintiff knew or should have known of the fact giving rise to the cause of action. The injury must be inherently undiscoverable and the evidence objectively verifiable. Whether an injury is inherently undiscoverable is determined on a categorical basis, not on the facts of the individual case.

… and applied

The court held that the Trust suffered an injury when the minerals were sold, but the discovery rule delayed limitations. The Tregellases bought the mineral rights with actual or constructive knowledge of the ROFR. The mineral owner conveyed the property in breach of that right without giving the trustees notice.

The question was not whether the trustees could have discovered their injury with diligence but whether the injury was the type of injury that could be discovered through the exercise of reasonable diligence.

A purchaser of property with actual or constructive notice of a ROFR purchasers subject to that right and stands in the shoes of his grantor. The ROFR holder has the right to be offered the property at a price offered by a bona fide purchaser if and when the owner decides to sell. Only when the grantor discloses the offer does the holder have a duty to act.

Who has a duty?  

The ROFR was described as an essentially dormant option. Only when the grantor communicates its intention to sell and discloses the offer does the ROFR holder have a duty to act. Here, in light of the grantor’s duty to provide notice, the absence of the ROFR holder’s duty to act before receipt of notice, and the fact that a purchaser takes property subject to the recorded ROFR, the holder who has been given no notice of the grantor’s intent to sell or the existence of a third-party offer generally has no reason to believe that his interest may have been impaired.

How is this different from Neel and its progeny?

In HECI Exploration Company v. Neel, the lessee failed to notify royalty owners of the existence of a cause of action against an adjoining operator for depleting a common reservoir. The Supreme Court deemed that not to be an inherently undiscoverable injury. Wells visible on neighboring properties put royalty owners or inquiry that there was a potential claim, and the royalty owners could have gotten the information from the lessee if they had just asked (Are you kidding me?), and Railroad Commission records showing drilling and production were not inherently undiscoverable. The inequity in Neel was that the royalty owners lived far away and, as a real world matter, were not in a position to investigate their rights and, as with the Trust in this case, did not know they had a reason to worry until it was too late.

It was a happy time for the trustees.

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Lateral Partner Recruits: Questions You Need Answered

Originally published by Cordell Parvin.

It was 2003, and I was having a record year. Near the end of the year, two large international law firms with Dallas offices offered me far greater compensation than I was making at my firm.

The difference was significant enough that many lawyers would have jumped to one of the firms just based on the increased compensation. I didn’t. I stayed with my firm one more year and then left to coach lawyers full-time.

I read recently that in a study of lateral partners barely more than half (52.8 %) responded they were “very satisfied” with their new firm. Based on my experience, I believe the laterals who were not “very satisfied” did not know enough about their new firm before making the change.

Lateral partner recruits: How much do you know about the firm that is about to make you an offer? What should you know?

Having been heavily recruited when I practiced law, I came up with questions I wanted to be answered from firms that wanted to make me an offer.  Here are some of those questions:

  1. May I review the firm’s partnership (shareholder) agreement?
  2. How would you describe the firm’s core values?
  3. Does the firm have a strategic plan?
  4. What are your expectations for partners? Associates?
  5. How do you hold your lawyers accountable for what is in the plan?
  6. Does the firm have a marketing plan and a marketing budget?
  7. How does the firm encourage lawyers to engage in client development efforts?
  8. Are associates encouraged to help with client development?
  9. Do your partners have a written business plan with goals?
  10. Do your associates have a development plan or some kind of plan for their non-billable time?
  11. Do you have a plan for cross-selling and expanding relationships with existing clients?
  12. How do you encourage partners to help develop your next generation of successful lawyers?
  13. What is the retention rate for partners?
  14. What is the retention rate for associates?
  15. Does the firm have any debt?
  16. May I see the firm’s financial statements for the last three years?
  17. What is your plan to successfully integrate me into the firm?
  18. How many total number of clients does the firm have, and what percentage of the firm’s business is coming from the top ten clients?

The post Lateral Partner Recruits: Questions You Need Answered appeared first on Cordell Parvin Blog.

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What’s Next? Stop-Gap Flood Insurance Extension Set To Expire On November 30, 2018

Originally published by Verne Pedro.

On November 30, 2018, the legislative authority that allows the National Flood Insurance Program (NFIP) to operate, will expire. The NFIP was originally set to expire on September 30, 2017. Since then NFIP has continued under a series of short-term extensions ever since; the current extension was authorized in July 2018. With the deadline fast…… Continue Reading

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USA Gymnastics Refuses to Grant Conflict Waiver, Stalling Houston Lawyer’s Lateral Move

Originally published by Brenda Sapino Jeffreys.

 

Efrain Gonzalez needs a conflict of interest waiver from USA Gymnastics to join Abraham. Watkins, Nichols, Sorrels, Agosto & Aziz, but the troubled organization is refusing to provide it.
      

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