Family Law
Essential Components of a Parenting Plan During Divorce
Divorce can be a challenging experience for families, especially when children are involved. One of the most important aspects of a divorce involving children is the creation of a parenting plan. A parenting plan, also known as a child custody agreement, outlines how parents will share responsibilities and time with their children after a divorce. Crafting a comprehensive and effective parenting plan can help reduce conflict and provide stability for the children. Here are the essential components to include in a parenting plan during a divorce: Custody Arrangements Physical Custody: Specifies where the child will primarily reside and the schedule for the child's time with each parent. Legal Custody: Determines which parent (or both) will have the authority to make major decisions regarding the child’s upbringing, such as education, healthcare, and religious upbringing. Visitation Schedule Establish a clear schedule for when the child will spend time with each parent, including regular visitation days, holidays, and special occasions such as birthdays. Include details on pick-up and drop-off times and locations to avoid misunderstandings. Communication Outline expectations for communication between the child and each parent, including phone calls, video chats, or other forms of contact. Specify how parents will communicate with each other about the child, including preferred methods (e.g., email, text) and frequency. Dispute Resolution Include a process for resolving disputes between parents, such as mediation, counseling, or another neutral third party. Avoid vague language and provide clear steps for conflict resolution to minimize misunderstandings. Child Support and Financial Provisions Specify the amount and frequency of child support payments, as well as how expenses such as medical care, education, extracurricular activities, and other significant costs will be divided. Address the child's insurance needs, including health, dental, and vision coverage. Education and Healthcare Address each parent's involvement in the child's education, including school-related decisions and participation in school activities. Specify how healthcare decisions will be made, including the choice of doctors and medical treatments. Travel and Relocation Define any restrictions on travel with the child, including requirements for notifying the other parent and obtaining consent for trips. Include provisions for what happens if one parent wants to relocate with the child, such as notice periods and mediation. Review and Modification Establish a process for reviewing and modifying the parenting plan as the child grows and circumstances change. Specify how often the plan will be reviewed (e.g., annually) and under what circumstances modifications can be made. Safety and Well-Being Address any concerns about the child's safety, including provisions for supervised visitation if necessary. Include guidelines for both parents regarding any substance abuse issues, criminal activity, or mental health concerns. Miscellaneous Provisions Consider including clauses for other aspects such as religious upbringing, participation in extracurricular activities, and access to the child's records (e.g., school, medical). Ensure the plan is as detailed as possible to avoid ambiguity and potential disputes. A well-thought-out parenting plan can provide a roadmap for co-parenting after divorce and help ensure the child's best interests are prioritized. Consulting with legal and family professionals can help parents create a comprehensive plan that suits their family's unique needs.
April 16, 2024
Construction
Show Me the Money: The Importance of Owner's Proof of Financing
Lack of project financing can be a very unpleasant surprise for a contractor (and all players on the project). In a volatile environment — where project costs are increasing and borrowed money, credit, and leverage are increasingly difficult to obtain — what are some approaches for a contractor to address and reduce these risks upfront or during the project? The best time to address project financing concerns is at the beginning, during preconstruction, and certainly before work has broken ground. Many contractors are hesitant to probe and inquire about project finances. If, however, there is any concern about whether the project will be adequately funded, it is best to ask for the necessary information directly. Representing that it is standard practice and policy may help reduce tension on disclosure of the information. An open and honest discussion on the financing not only ensures that the project does not stall but also is reasonable because a contractor’s role in confirming the project costs, schedule, setting contingencies, experience and reputation, and qualifying the trades is a key component to the owner’s discussions with the bank to obtain financing. It makes sense that if the owner is reliant on the contractor to help obtain the financing, then, likewise, the contractor should have the ability to confirm that the financing is sufficient, too. At the start of the relationship, the contractor can communicate to the owner that it expects to receive satisfactory proof of financing that might include any of the following: Commitment letter from bank/lender or equivalent term sheet or written confirmation from a lending committee at the bank. Oral conversations with the bank/lender to confirm financing. Documentation confirming loan amount, terms for the loan and disbursements, and a commitment to a loan closing date. Documentation of disbursements, such as disbursement agreements or a disbursement summary. If the owner is self-financing the project, it is reasonable to ask that funds be set aside for the project. This could be done with the bank (or a third party) and a statement showing proof of funds. It is also reasonable to ask for financial statements, credit reports, and bank strength ratings, especially if it is self-financed by an unfamiliar owner. Depending on the circumstances, further information might be necessary, including details of the owner’s budget for the project. Such details should be set forth in the owner’s pro forma or related documents. The documents should identify proper contingencies, reserves, and budgets to cover the various issues that can arise with the owner’s land development, design, and construction. Including clauses in the prime contract that address financing issues is also useful. The contract should include a clause that entitles the contractor to request additional proof of funding or even the right to engage in direct discussions with any lender or bank. The clause should also express that the contractor has the right to suspend work in the event of slow payments or indications of problems with the owner’s financing on the project. Contractors should also pay particularly close attention to the ownership entity of the land/project. First, the owner should provide adequate information to confirm the record owner of the real estate. If the owner of the real estate is an unknown company or is a “single shot” LLC used for holding the real estate (often indicated by its name, which uses the property address, such as, for example, 35 Main Street, LLC), then, the contractor should realize that the LLC owner of the property likely has no other assets other than the project property itself. In these “single-shot” scenarios, a mechanics’ lien right is the best approach to lack of payment because it attaches to the property itself, and, other than the property, the LLC may have limited or no other assets. Also, it is best to obtain the information of the LLC owners (members) if possible because the financials of a single-shot LLC are only as strong as the loan and members backing the LLC. If the contracting party is not the record owner, that creates a few additional wrinkles that must be addressed for both proof of financing and also mechanics’ lien rights. A last point for consideration: Sureties often require disclosure of project finances. One tactic is to bond the project with a surety, which has some benefits aside from this discussion, and use the surety as the reason for all the financial questions. This shifts any tension from the contractor to a third-party surety. Handling problems with project financing can be a thorny situation at any point in a project. The best practice is to have sound internal protocols and trusted counsel for troubleshooting. Offit Kurman construction attorneys are available to advise and counsel contractors, construction managers, design-builders, design professionals, subcontractors, and developers on construction contracts, risk, and project disputes.
April 16, 2024
Labor and Employment
In the Know Series - Labor & Employment Law Changes – Federal
Stay Ahead of the Curve with Key Insights from Our L&E Team Now that the first quarter is behind us, employers across the nation must navigate changes in federal labor and employment regulations. Our team has compiled a comprehensive overview of the latest updates at the federal level, providing insights to help you stay compliant and proactive in managing your workforce. While not updates to the law, notable issues are below: With increased scrutiny on the ERC, the Service is starting to send out letters denying the credit. We anticipate it will send letters to employers who deserve the credit. Misdirected payroll tax deposits by payroll companies have increased, particularly where the payroll company handles payroll for related companies. Because they involve payroll taxes, the Service is particularly aggressive in its collection efforts. The quicker the client lets us know, the easier (and quicker) it is to resolve. ACA Issues: companies are receiving deficiency notices for failure to provide MEC. Most notices now are for the 2020 tax year. It is important for employers to understand that Treas. Reg. § 54-4980H-5((e)(2)(ii) does not define whether an offer of coverage is affordable. It simply provides a safe harbor. IRC § 36B(c)(2)(C)(i) determines whether an employer’s offer of coverage is affordable, which means even if coverage does not meet the safe harbor, it still may be affordable, so the employer avoids a penalty. We have obtained penalty abatements for several clients on this issue. Employer-Sponsored Healthcare Plans - The Next ERISA Fiduciary Duty Battlefield: With the issuance of much awaited final regulations, DOL has made clear that ERISA fiduciary duties apply with equal force to health and welfare benefit plans. Plaintiffs’ lawyers are actively looking for plaintiffs who are participants in employer-sponsored plans, particularly following the recent court decision regarding Johnson & Johnson’s healthcare plan. As in many areas, the best offense is a strong defense, which begins with companies implementing a health and welfare benefits committee to take a much more active role in the selection and negotiation of health plan benefits and documenting this process We have guided many clients on how to organize and structure health and welfare benefit committees.
April 15, 2024
Commercial Litigation
Protecting Real Estate Rights - Filing a Lis Pendens in Virginia
In the realm of real estate litigation, securing or defending your interests during a pending legal action is paramount. One tool often utilized is the filing of a lis pendens, a Latin term meaning "suit pending." In Virginia, the lis pendens memorandum serves as a notice to prospective buyers, lenders, or interested parties that a property is subject to a claim involved in litigation. How to file a lis pendens in Virginia: Initiate Legal Action concerning an interest in Real Property: First, a legal action concerning the specific real property must be filed. Common legal actions include claims related to ownership, title defects, construction, or other property interests. Importantly, a party cannot file a lis pendens memorandum unless the action on which the lis pendens is based seeks to establish an interest by the filing party or to enforce a zoning ordinance. Code § 8.01-268. Draft the lis pendens memorandum: Once a legal action is filed, the claimant must draft the lis pendens memorandum and include the following information:the title of the pending legal action the general object of the legal action the court where the legal action is pending the amount of the claim asserted by the plaintiff a description of the real property the name of the person whose estate is intended to be affected by the lis pendens a description of the alleged zoning violation (only in actions to enforce a zoning ordinance) Recording with the Circuit Court Clerk: Once drafted, the lis pendens memorandum must be recorded with the Circuit Court Clerk in the jurisdiction where the property is located. Recording ensures that the memorandum becomes part of the public record and is accessible to anyone conducting due diligence on the property. Maintaining Compliance: Claimants must adhere to all statutory requirements and deadlines associated with filing a lis pendens in Virginia. Failure to comply with these requirements could result in the lis pendens being deemed invalid or ineffective. Why File a Lis Pendens? Preservation of Property Rights: Filing a lis pendens in Virginia allows claimants to preserve their rights and interests in real property during the pendency of litigation. The lis pendens is a publicly recorded document that provides notice to potential buyers, lenders, or claimants and can prevent unauthorized transactions or encumbrances on the property. Protection Against Conveyances: Lis pendens acts as a safeguard against possible fraudulent or voluntary conveyances of property during pending litigation. By alerting third parties to the existence of pending litigation concerning real property, claimants can deter individuals from attempting to transfer or encumber the property in bad faith. Enhanced Negotiating Position: The presence of a lis pendens can strengthen a claimant's negotiating position during settlement discussions. Interested parties may be more inclined to reach a favorable resolution, knowing that the property's status is subject to ongoing litigation. Public Notice: Filing a lis pendens provides public notice of the legal action, thereby reducing the risk of subsequent purchasers or lenders claiming ignorance of the litigation. This transparency promotes fairness and protects the interests of all parties involved. Conclusion Filing a lis pendens serves as a vital tool for claimants seeking to protect their rights and interests in real property during the course of litigation. By following the prescribed process and understanding the strategic advantages of filing a lis pendens, claimants can effectively assert their claims and mitigate the risk of adverse actions against the property. If you or your organization have a real estate-related claim, consulting with a trusted attorney in your area is critical. While outcomes cannot be guaranteed and past performance cannot assure future success, Offit Kurman litigator Anders Sleight | Offit Kurman is available to evaluate your specific situation.
April 11, 2024
Labor and Employment
In the Know Series - Labor & Employment Law Changes in Delaware
Stay Ahead of the Curve with Key Insights from Our L&E Team Delaware joins the ranks of states ushering in updates to employment legislation this year. Now that the first quarter is behind us, it is crucial for construction industry employers in the First State to stay informed about these changes to ensure compliance and mitigate potential risks. Here is a brief summary of some of the key updates affecting construction industry employers in Delaware. Paid FMLA: This passed and was signed a year or more ago and rolls out a major change for Delaware employers with 10 or more employees. Far too detailed to explain in depth here but suffice it to say that this creates a system similar to unemployment, where employers pay into a fund for their employees (partially paid by the employee, partially paid by the employer) and employees will eventually be able to tap the fund for qualifying FMLA events. While similar to federal FMLA the “paid” component creates a host of employer obligations. Wage Theft: This was passed a year or so ago and allows the State to pursue employers criminally for “wage theft” from their employees. To my knowledge this has not been tested yet, but our highly aggressive DOL has only to find a good test case and I’m sure we’ll see it in action. Recreational Marijuana: The bill was allowed to become law without the Governor’s signature (he opposed it and vetoed the version that passed in 2022). At present the agency tasked to administer the law is preparing draft regulations and creating the infrastructure for licensing in cultivation, testing, manufacture, and retail sale of marijuana in Delaware. Employers may still prohibit use on company property/time and conduct testing. This is distinct from medical marijuana, which has been legal here for over a decade. Joint and Several Liability: Efforts are underway in the General Assembly to make upstream contractors, prime and general contractors, liable for violations of wage and contractor registry statutes. This creates a tremendous burden on upstream contractors to “police” those working under them, even second and third (or greater) tier subcontractors.
April 11, 2024
Labor and Employment
Ask Sarah: Handling Extended Employee Absences Effectively
Dear Sarah: Help! I have an employee who has been out of work for twenty weeks. He has an “expected” return to work date, but we have not received anything definitive. Because of his absence, business is suffering, and I need to find someone to take over his job duties. What am I legally permitted to do here!? — Frustrated & Confused HR Rep Believe it or not, encountering this issue is not uncommon. When an employee requests additional time off beyond their twelve-week Family Medical Leave Act (FMLA) entitlement (assuming FMLA applies to that employer), it often leaves employers feeling perplexed. Accommodating a disabled employee under the Americans with Disabilities Act (ADA) can pose significant challenges for employers. If the employee's limitations prevent them from fulfilling essential job duties, granting an unpaid leave of absence may be deemed a reasonable accommodation. However, relying solely on unpaid leave creates staffing challenges for employers. Nonetheless, if other alternative accommodations are not feasible, unpaid leave should be considered an option. Reasonable accommodations for a qualified individual with a disability — defined as someone who, with or without reasonable accommodation, can perform the essential functions of their job — may involve various measures, including: Eliminating non-essential job duties Modifying job processes Providing supportive aids to assist the employee Adjusting schedules to accommodate needs Offering light duty positions if available Facilitating transfers to open positions Granting an unpaid leave of absence, among other options While an employer is not obligated to provide the exact accommodation requested by an employee, it is required to provide a reasonable accommodation that enables the employee to effectively perform essential job functions. If implementing the only feasible reasonable accommodation would result in substantial difficulty or expense for the employer or fundamentally alter the nature of the job, it may be deemed an undue hardship, exempting the employer from providing it. The threshold for defining undue hardship may vary based on the employer's size and resources, but meeting this standard can be particularly challenging in certain circumstances. The Equal Employment Opportunity Commission's (EEOC) ADA guidance suggests that considering unpaid leave as a reasonable accommodation is wise for employers. While EEOC guidance lacks the weight of law, courts often find it persuasive due to the agency's role in ADA enforcement. The duration of leave an employer must grant is not explicitly defined and should be assessed on a case-by-case basis. The EEOC and numerous federal courts assert that an indefinite leave of absence without a reasonable estimate of the return-to-work timeframe may constitute an undue hardship and is not mandatory. However, situations where an employee's medical provider recommends an extended absence before the employee returns to the job pose challenging and context-specific questions influenced by factors such as the nature of the employer's business, the employee's role, and the anticipated duration of absence. While definitive answers may not exist for every scenario, if the requested leave has a defined duration and supporting medical documentation suggests it will enable the employee to return to work, employers retain the right to deny it if granting the leave would unduly burden the business. Furthermore, even if a specific leave initially seems manageable, circumstances may change over time, emphasizing the importance of requiring thorough documentation throughout the leave period. For example, requesting a note from the treating physician specifying an estimated return-to-work date and asking the medical provider to opine on the medical rationale for the leave may help make the leave process more transparent and facilitate the employee's return. Additionally, gathering this information could help employers apply the undue hardship analysis in a manner that is advantageous to its operations. Handling successive leave requests cautiously and seeking consultation before making decisions are crucial practices to uphold. In conclusion, navigating extended employee leaves beyond the FMLA entitlement can be daunting for employers, especially when accommodating disabled employees under the ADA. While unpaid leave may be a reasonable accommodation, it can pose operational challenges. Employers must explore alternative accommodations while considering undue hardship factors, such as significant difficulty or expense. The EEOC's guidance on unpaid leave underscores its importance as a potential accommodation, albeit without a specified duration. However, indefinite leaves without a return-to-work timeframe may constitute undue hardship. Employers should carefully assess each situation, document medical rationales, and seek legal advice to make informed decisions. If you're facing similar HR dilemmas or need legal guidance on employment matters, don't hesitate to contact me for assistance. Reach out today to ensure compliance with ADA regulations and protect your business's interests. Blog Disclaimer: The information provided in this blog is for general informational purposes only and should not be considered legal advice. Consult a qualified attorney for advice on specific legal issues.
April 10, 2024
Family Law
Credit Card Chaos: Safeguarding Your Credit in Separation
Often spouses share joint credit cards during their marriage, or one spouse may be added as an authorized user on the other’s credit card. However, upon separation, one party may continue using the card, leading to significant debt accumulation. When considering divorce or separation, paying prompt special attention to the status of your credit accounts is crucial. Determine if the accounts are joint or individual. If there are any individual accounts, check if your spouse is an authorized user. Please consult an attorney about closing joint accounts or converting them to individual ones before canceling any authorized user cards. Additionally, it is essential to run a credit report to identify all accounts in your name or jointly. Often, one spouse may be unaware that their credit is linked to the other spouse’s accounts. In many divorce cases, parties and their attorneys will reach an agreement as to who is responsible for which credit card debt or arrange to pay off specific debts from marital assets before or after the finalization of the divorce. However, what if one party fails to abide by the agreement? In the case of a joint account, failure to pay by one party would adversely impact both parties’ credit scores. While the innocent spouse can bring the offending spouse back to court for violating the order, there is no court remedy to repair a credit score. Avoid leaving any loose ends in your divorce proceedings. Ensure all joint accounts are closed and paid off before the divorce is finalized or transferred into the responsible party’s name. Don’t solely rely on your spouse’s agreement to pay off the debt. Secure funds from another asset, if possible, to settle the account promptly and ensure your name is removed from the account as soon as possible. When considering divorce or separation, consult with an experienced family law attorney such as Megan Smith and Emily Ingall about closing joint accounts or converting them to individual accounts before canceling any authorized user cards. Should you have any questions, don't hesitate to contact Megan and Emily for guidance.
April 9, 2024
Real Estate
Legal Considerations for Warehouse Leases in the Transportation and Shipping Industries
Warehouse leases are integral to the operations of businesses within the transportation and shipping industries, providing essential storage hubs for goods in transit. Navigating the legal landscape surrounding warehouse leases requires careful consideration of various factors to protect the interests of both landlords and tenants. From mitigating liability concerns to ensuring regulatory compliance, here are essential legal considerations to address when entering into warehouse lease agreements. 1. Lease Terms and Conditions Warehouse leases should comprehensively outline the terms and conditions of occupancy to ensure clarity and protect the interests of all parties involved. These terms should include, but not be limited to, the duration of the lease, permitted use of the space, rental rates, payment terms, options for renewal, restrictions on alterations, obligations regarding maintenance and repairs, termination rights, and provisions for parking arrangements. When evaluating your space requirements, consider factors like storage capacity, loading and unloading requirements, and any unique features needed for your operations. Make sure that the lease contains an adequate and clear description and depiction of the space. This becomes especially critical for new construction leases when the square footage of the space can only be estimated at the time of lease signing. In such cases, the lease should reserve a right for you to measure and confirm the square footage upon delivery of possession by the landlord and should define the method of measurement to be used. 2. Build-Out / Tenant Improvements It is imperative at the outset to have clear guidance for the initial build-out of your space, including who is responsible for what, who pays for what, and the sequence in which the build-out must occur to ensure timely delivery of the space. The governmental approvals required for such build-out and determining the parties’ obligations to secure such approvals are of significant importance. The timeframe to obtain any necessary approvals will factor into negotiating the rent commencement date. Moreover, make sure to negotiate and have the lease explicitly state who shall own such alterations and any requirements for restoring the space to its original condition at the expiration of the lease. 3. Liability and Insurance Determining liability for loss, damage, or theft of goods stored in the warehouse is crucial. The lease should outline insurance requirements for both parties, including general liability insurance and property insurance. Provisions should also address indemnification obligations to protect against legal claims arising from warehouse operations or landlord negligence. 4. Casualty and Condemnation Accidents and other forces of nature happen, and when they do, both parties generally want the space to be restored as soon as possible. You should consider rent abatement and termination rights dependent upon the timeframe for restoration. Events of condemnation (eminent domain), while not terribly common, do happen, and the lease should not be silent about what happens when they do. 5. Maintenance and Repairs Establishing clear maintenance and repair responsibilities guidelines is crucial for preventing disputes between landlords and tenants. The lease should specify which party is responsible for maintaining the warehouse’s structural integrity, along with overseeing essential systems such as HVAC, plumbing, and electrical. Additionally, it should outline provisions for emergency repairs and articulate the process for addressing maintenance concerns. By defining these responsibilities upfront, both parties can mitigate potential conflicts and ensure the smooth operation of the leased premises. The lease structure will determine whether you are required to pay additional rent for property taxes, insurance, and maintenance expenses. Under a triple net lease, the costs of owning and operating the building are passed through to you. To safeguard your interests, limits should be imposed on potential increases in the amounts of operating expenses over the term of the lease, certain costs should be excluded from being passed through to you, and you should have audit rights. These measures ensure transparency and protect you from unforeseen financial burdens, enhancing the overall fairness and sustainability of the lease agreement. 6. Compliance with Regulations Warehouse operations are subject to various regulations at the local, state, and federal levels, including zoning laws, building codes, and environmental regulations. Not only should the lease require compliance with applicable laws and regulations, with provisions for audits, permits, and certifications as necessary, but you should also perform due diligence prior to lease execution to ensure you do not inherit landlord’s or a prior tenant’s liability. 7. Security Measures Security plays a paramount role in warehouse operations to protect valuable inventory from potential theft or damage. A comprehensive lease agreement should address security measures such as surveillance systems, access controls, and fencing. Landlords may also have obligations to provide adequate lighting and secure entry points to the premises. 8. Subleasing and Assignment You should seek flexibility to sublease or assign your lease rights to third parties. The lease should outline the process for obtaining landlord consent for subleasing or assignment, including any conditions and restrictions to such consent and any exceptions from requiring such consent. At the lease negotiation stage, you should consider the potential for a future sale or merger of your business, in which case flexibility of assignment of your lease rights is particularly important. 9. Termination and Default The lease should include provisions for termination and default, specifying circumstances under which either party can terminate the lease. This may consist of failure to pay rent, breach of lease terms, or insolvency. In addition, the lease should include clear guidelines for notice periods, cure periods, and remedies in the case of default to protect the interests of both parties. From your perspective, you will want to ensure you receive notice of any alleged event of default and an adequate opportunity to cure before the landlord can exercise remedies. Conversely, the landlord will want to ensure that it has events of default that can be triggered automatically or quickly, as well as enforceable remedies. 10. Dispute Resolution Mechanisms Despite efforts to prevent conflicts, disputes may arise between landlords and tenants during the lease term. The lease should include mechanisms for resolving disputes, such as mediation, arbitration, or litigation. Clear procedures for dispute resolution help expedite resolution and minimize disruptions to warehouse operations. Addressing these legal considerations in warehouse leases is essential for protecting the interests of landlords and tenants in the transportation and shipping industries. By clearly defining rights, responsibilities, and obligations upfront, you can minimize legal risks and disruptions in the operation of your business, ensure compliance with regulations, and maintain a positive landlord-tenant relationship throughout the lease term. For personalized assistance in tailoring your warehouse lease to suit your specific needs and circumstances, please feel free to contact Faith Miros or Mark Wendaur. We are here to help you navigate the complexities of warehouse leasing with expertise and care.
April 9, 2024
Labor and Employment
In the Know Series - Labor & Employment Law Changes in California
Stay Ahead of the Curve with Key Insights from Our L&E Team Now that the first quarter is behind us, all California employers should ensure that they are aware of and are in compliance with the new 2024 California employment laws. Our team has compiled a concise overview of these changes to keep you informed and prepared for compliance. The west coast was fairly active this year and the following are the major changes in the law: Effective January 1, 2024: State-mandated sick leave increases to 5 days. If the client has PTO, the analysis may be a math problem. Also, remember that several California cities have their own sick leave laws that require more than 5 days of sick leave. All employers, regardless of size, must allow up to 5 days of reproductive loss leave (for failed adoption, failed surrogacy, miscarriage, stillbirth, or an unsuccessful assisted reproduction). This is in addition to family medical leave. The state has codified the fact that non-competes are void, with the exception of the sale of goodwill when a business is sold as set forth in Business and Professions Code § 16601. One new statute states they are void regardless of where signed (even outside the state). Another statute requires employers with employees who have signed non-competes to notify them by February 14, 2024, that the non-compete provision is void. Marijuana use becomes a protected basis under the Fair Employment and Housing Act. Employees cannot use or be under the influence at work, but an applicant cannot be denied employment if they test positive for marijuana. The regulations regarding criminal background checks were revised requiring the employer to conduct a detailed individualized assessment before denying an applicant employment. The minimum wage is increasing to $16.00/hour on January 1, 2024, which means exempt employees need to earn a minimum of $66,560 annually and $5,546.67 monthly in order to be exempt. Effective April 1, 2024 The minimum wage for fast food workers rises to $20/hour. Effective July 1, 2024: All employers will be required to have a workplace violence plan. Similar to an Injury & Illness Prevention program if you are familiar with those plans – in other words, it needs to be in writing, employees need to be trained and it will take some effort to be in compliance.
April 5, 2024
Intellectual Property
Navigating Trademark Complexities: Meta’s Brazilian Setback
Meta Platforms Inc., the behemoth that owns Facebook, Instagram, Threads and others, recently faced a court in Brazil that prohibited the company from using the Meta trademark in the country. A digital transformation consultancy has held a registered trademark for Meta in Brazil since 1990, resulting in Meta Platforms being blocked from using the trademark. The refusal in Brazil demonstrates the challenges inherent in global branding. For one thing, searching for the availability of trademarks worldwide is prohibitively expensive for many businesses. Of course, Meta is a deep-pocketed company that likely researched the availability of this trademark far and wide before announcing their decision to change their name from Facebook in October 2021. However, for reasons unknown, the company went forward with the rebrand, even though this obstacle existed in one of the largest countries in the world. Of course, we do not know what Meta’s team of lawyers advised, but regardless, the company finds itself in an unfortunate situation, unable to use META in Brazil. This scenario is not limited to international borders; it can also occur within the United States. A trademark registration, which can be obtained if a business uses a trademark in more than one state, provides nationwide rights and protections against later users. But what happens when one company adopts a brand that is already used in a part of the United States? The junior user may need to select one trademark to use in one part of the country and a different one for the rest of the country. Such is the case with the ice cream brand Dreyer’s, which people in the eastern half of the U.S. know as Edy’s. When Dreyer’s came along, there was already a well-known brand of ice cream sold in supermarkets called Breyers. Photo courtesy of Laura Winston Photo courtesy of Laura Winston Another instance is Hellmann’s mayonnaise, known as Best Foods mayonnaise west of the Rocky Mountains. The U.S. Patent and Trademark Office may grant what is known as a “concurrent use registration,” which carves out the territories in which each party has the rights derived from mark registration. This is an exception that challenges the principle that a trademark registration provides nationwide rights. Whether your business is going global or you are considering expanding within the United States, it is best to consult with an attorney who can advise you about the best ways to protect and expand your trademark rights. If you have any questions, please feel free to reach out.
April 4, 2024
Family Law
Unleashing Your Inner Barbie: Embracing Independence after Divorce
While some may view the Barbie Movie as nothing more than a whimsical, kitschy movie based on the famous Mattel doll. However, when viewed through the lens of Ms. Greta Gerwig, the film’s director, the film illuminates Barbie’s journey of self-discovery as Barbie learns how to stand on her own two legs, both literally and figuratively, realizing that she does not need a “Ken” to define herself. Thus, she asserts her independence and defines herself on her own terms, free from the constraints of societal norms and expectations. In marriages, women often grapple with identity issues, feeling like their sense of self has been replaced by their role as a wife or mother. A common cause for divorce is a spouse’s desire and need to rediscover their identity. In post-divorce life, many women face the challenge of discovering who they are, what skills and resources they will need to navigate an independent life, where they fit into society, and, most importantly, how to successfully and meaningfully live life without their “Ken.” Progressing forward post-divorce is more challenging for more women than men since many must remain financially connected to their “Ken” through spousal and child support payments. Closure becomes more elusive, hindering pursuing new opportunities and nurturing personal growth. Whether you want to be a Teacher Barbie, an Attorney Barbie, a Nurse Barbie, or a Real Estate Agent Barbie, it is important, post-divorce, to surrender to your imagination and rely on your matrimonial attorney. They should not only have the experience to navigate you through the financial intricacies of divorce but also demonstrate empathy for your post-divorce journey. Recognize that finding your best Barbie may require additional support, such as a competent financial planner to help you manage assets, a therapist to boost self-esteem and confidence, or a vocational coach to aid in re-entering the workforce. Trust in this collaborative approach to empower yourself and pave the way for a fulfilling post-divorce life. In a poignant moment near the movie’s end, Barbie reflects, “I don’t think I have an ending.” Ruth Handler, the creator of Barbie (or rather her ghost, as portrayed by Rhea Perlman), affirms that this lack of conclusion was intentional. “That was always the point,” she explains to Barbie, “I created you so you wouldn’t have an ending.” Like Barbie’s story, divorce is not an end but a new beginning. It’s your narrative to shape, filled with choices and the occasional misstep. Embrace your journey, forgive yourself for any missteps, and remember to draw strength from your inner Barbie whenever doubt creeps in. In the journey of life, divorce marks not an ending but a beginning – an opportunity to redefine yourself and craft your own narrative. As you navigate this new chapter, our legal team is here to provide the support and guidance you need to empower yourself and embrace your future with confidence. Reach out to us today to take the first step towards reclaiming your independence and authoring your own story. Remember, you’re not alone – let us help you channel your inner Barbie and write the next chapter of your life. NOTE: BARBIE is a registered trademark of MATTEL, INC.
April 3, 2024
Business
Shipment Success: The Importance of Pre-Contract Qualification in Fulfillment Centers
Shipping fulfillment centers play a pivotal role in the third-party logistics ecosystem. These businesses are uniquely positioned as both a warehouse to store products sold on e-commerce sites and a service provider responsible for packing and shipping such products once ordered. This dual role creates unique liabilities and responsibilities for each of these two functions. Appropriate customer and vendor screening is important to complete these functions. Warehouse Liability and Issues When a shipping fulfillment center receives customer products for storage and subsequent shipment, it is critical to understand what the products are, together with the creditworthiness of the fulfillment center’s customer. Product considerations may include: What products require a temperature-controlled environment? Do the products contain regulated materials that require special handling and storage? What is the packaging of these products when delivered to the fulfillment center warehouse? Additionally, assessing the customer’s creditworthiness upfront helps address accounts receivable issues and prevents scenarios where aging customer inventory occupies valuable rack space due to non-payment or bankruptcy. Each of these considerations is tied to some aspect of liability and whether the fulfillment center must take special steps to mitigate any such liability. This may include incorporating special charges for mitigation efforts into the service agreement with the customer. Packing and Shipping Concerns Similarly, the fulfillment center’s packing and shipping side must understand the customer’s desired packaging requests and shipping procedures. For example: Does the shipped product contain unique characteristics requiring special packaging materials? Are special freight charges likely to apply? Is the fulfillment center provided with the shipping materials, or is this item being sourced from a third party? Each of these factors will affect the workflow of the fulfillment center team. Pre-Contract Qualification of Customers With the above issues in mind, the fulfillment center must assess whether the customer is a good fit for their business or otherwise contract around any concerns or issues. This decision-making process (and subsequent contract negotiation) will help mitigate issues such as damage to other customer products, unforeseen expenses incurred to the fulfillment center’s detriment, delayed shipping issues, or rack space occupied by defunct customers. Implementing a comprehensive customer screening process will help drive better customer interactions and warehouse efficiency while ensuring that you engage with reliable and legitimate parties. Here is a structured approach that your warehouse can implement to evaluate potential customers: 1. Authorization to Do Business; Background Checks Documentation Check: Require potential customers to provide official business registration documents from the appropriate governmental body in their state (or, when dealing with international companies, their country of origin). This verifies their legal existence and is an easy way to confirm whether this customer sells legitimate products accepted by the market. Be cautious of any company unable to provide such documentation, as they may be either undercapitalized or operating as “fly-by-night” entities selling defective or non-compliant products until the market rejects them. Such companies are prone to leaving fulfillment centers with unpaid invoices and obsolete inventory occupying valuable fulfillment center rack space. Verification with Authorities: Cross-check the provided documents with relevant authorities or utilize online government databases specifically designed for business verification. Background Check: If the account is a significant size, consider a background check to ensure the company has a history of legitimate business operations and payment history. This can include checking for any legal issues or past bankruptcies. References: In addition to conducting background checks, consider requesting financial references from banks and other companies that have done business with the potential customer. This provides valuable insights into their financial integrity and payment track record. This is also an important step when negotiating contract terms because the fulfillment center can assert a security interest in the products being stored. Therefore, it is crucial to identify existing lienholders and assess whether they are considering legal action against the customer. 2. Proper Licensing Licensing Verification: Ask for copies of relevant licenses if the products use special materials that require specialized care. This same consideration should be given when hiring vendors to handle specialized products. This step is crucial for ensuring compliance with industry regulations and standards, as well as your applicable insurance policies. Compliance Checks: Conduct or request audits on compliance with industry-specific regulations and standards. This might include environmental, safety, and other operational standards relevant to the logistics sector. Implementing the Process Once you develop a screening and qualification process for customers, implementing that process into your daily workflows is essential. The best way to implement such screening is by creating a digital or paper-based checklist to be reviewed when accepting new customer inquiries. The process should also be continuous. Customers can change over time, so annual or bi-annual compliance and background checks can help proactively identify payment issues before they begin. Establish a structured procedure for periodic customer re-evaluation to ensure ongoing compliance with your standards. Lastly, be sure to maintain detailed records of all checks and verifications carried out. These records serve as vital documentation for audits, compliance checks, and resolving any potential disputes with the customer or third parties. Conclusion Implementing these measures will significantly reduce the risk associated with onboarding new customers. Warehouse space is critical for fulfillment center operations, and one of the quickest ways to endanger profits is to have this space occupied by delinquent customer accounts. Remember, the depth of the screening should be proportional to the potential risk and impact the customer might have on the fulfillment center’s business operations. For assistance implementing a customer screening process or addressing specific concerns in contracts, feel free to reach out to Mark Wendaur or Faith Miros.
April 2, 2024
Commercial Litigation
Five Things to Know About Hiring a Litigator
Did you get sued for the first time? Then you’ve got litigation on your hands. Litigation is just another word for a court case. Choosing an attorney to represent you in that litigation is tricky — and very important. Here are five things to know about hiring a litigator: 1. Hire Within Your Budget Most attorneys in the New York City area have higher billable rates. This is common across the country — legal services cost more in larger cities. But just because most attorneys have higher billable rates doesn’t mean you can’t afford high-quality representation. Make sure you know your attorney’s billable rate and ask about budgeting for your case. For example: What is your estimated budget for each stage of the case? What can we do to keep costs low in the case? Who will work on my case, and what is each person’s billable rate? 2. Experience vs. Titles Titles vary from firm to firm. What ultimately matters is the experience. An associate at a midsize firm might have more experience than someone who opened their own practice straight out of law school. On top of that, a midsize firm gives you the best of both worlds with experienced associates and significant resources at their disposal — but not at big law firm rates. 3. Seek a Clear Communicator Make sure your attorney tells you what the options are for your case — in detail and in language that you understand. Litigation is stressful, emotional, and expensive. If communication isn’t clear from the outset, it is likely to only add more stress, confusion, and frustration to your case — which may last for months or even years. Many attorneys have poor bedside manners. The term “legalese” exists for a reason. The law can be complex and dense — it’s your lawyer’s role to communicate to you clearly what’s happening. You shouldn’t feel talked down to. If your attorney is an effective communicator, you will receive updates about your case in clear and understandable language, confidently discuss each component of your case, and strategize together about how best to move forward. 4. Hire a Litigator, Not an Attorney Even though all attorneys are admitted to practice law, they’re not all the same. Litigation is a specialty. It requires being familiar with the court rules. More than that, it means having expertise in using the tools available to give you an edge in the case. Find a litigator who knows how to practice in the court your case is in. Even then, litigation is a wide-ranging area with many specialties. Make sure you ask about that attorney’s experience in your case’s area. For example: Have they worked on a case in this area before? What are some of the strategies that work well for this type of case? Do other attorneys in their firm have experience in this area? 5. Act Quickly As soon as a case starts, so do the deadlines. If you delay taking action for too long, the deadlines will pass, and your attorney will have to try to undo the damage by asking the court to give you another chance to make things right. All of this work is likely to result in additional costs and time. It is imperative to move quickly. Reach out to schedule a consultation right away so that you can best protect yourself.
April 2, 2024
One Minute of Overtime
Legal Test
Welcome to One Minute of Overtime, where I will share insights on Labor and Employment Law topics, mostly related to minimum wage and overtime compliance issues. Compliance in this area of law is nuanced and technical, so it is critical for employers to audit and adjust their practices to remain compliant, so stop by to stay up-to-date and in-the-know. Whether a worker is an employee, or an independent contractor is not a choice the employer gets to make. Instead, it is a legal conclusion reached based on the application of a legal test. In Maryland, the test focuses on the economic realities of the engagement.
March 20, 2024
Commercial Litigation
Protecting Your Business: Understanding ADA Website Accessibility Lawsuits in New York
Did you receive a complaint alleging that your company’s website violates New York’s equivalent of the Americans with Disabilities Act? Does the complaint allege the website violates New York State Human Rights Law and New York City Human Rights Law? By an individual claiming they tried to purchase goods on your website but could not do so due to accessibility issues? You are far from alone. Court dockets are ballooning in New York with these cases. With the right strategy, you can maximize your chances of greatly reducing the exposure you face and potentially securing the dismissal of the case without paying the other side a dime. Here are five things to know about your case: 1. Your Website Actually May Have Accessibility Issues There are many technical requirements for making your website accessible. It is important to work with a trusted vendor to bring your website into compliance, but that alone won’t cause the lawsuit to be dismissed. 2. Still, the Plaintiff Must Be Able to Prove the Impairment or Disability Even though your website may have been inaccessible to those with an impairment or disability, the plaintiff who sued you still must be able to prove that they are impaired or disabled. The phase of the lawsuit where you can dig into that proof is the discovery phase, and with the right strategy, you may be able to resolve the case during that phase and not have to proceed to trial. 3. A Fast-Paced, Active Approach Tends to Work Best The law firms that file these cases file a lot of them. Managing such a high volume of cases takes time and effort. With so many cases, their attorneys prefer to attack those cases where the other side is asleep at the wheel. Don’t show complacency. Instead, bring the fight to them and put them on their heels. 4. Don’t Expect Immediate Results Depending on which court your case is in, you may be facing a court with a lengthy process to bring your case to its close. The court may take its time to move your case along, and there are ways to nudge it to the next step. Maintaining that proactive approach is best, but be ready for the case to likely last a minimum of several months. 5. Be Ready to Negotiate Settlement talks can happen at any stage of the case. Don’t assume that the first offer you receive will be one you’re ready to take. Often, the attorneys for the other side are anxious to settle the case and will be open to significant negotiation. If you just received a complaint about your website, it is imperative that you act quickly. As soon as a lawsuit starts, so do the deadlines. You don’t want to miss a deadline—especially in this type of case where the other side is waiting for you to slip up.
March 15, 2024
Family Law
Shareholder Agreements in Divorce: A Legal Perspective
Divorce proceedings can often involve complex financial negotiations, particularly when business interests are involved. When spouses who are shareholders in a company decide to part ways, it can raise a host of challenging issues regarding the disposition of shares, control of the business, and the future direction of the company. In such cases, understanding shareholder agreements becomes crucial, as they often dictate how shares can be transferred, sold, or retained in the event of a divorce. Shareholder agreements are legal documents that outline the rights and obligations of shareholders in a company. These agreements typically address a wide range of matters, including the transfer of shares, the appointment of directors, voting rights, and dispute resolution mechanisms. While shareholder agreements vary widely depending on the specific needs and circumstances of the shareholders and the company, they often contain provisions that address what happens in the event of a shareholder’s divorce. One common provision found in shareholder agreements is a buy-sell agreement, also known as a buyout agreement. A buy-sell agreement is a contractual arrangement between shareholders that governs the sale and purchase of shares under certain circumstances, such as death, disability, retirement, or divorce. In the context of divorce, a buy-sell agreement may specify that the shares owned by a divorcing shareholder must be sold to the remaining shareholders or to the company itself at a predetermined price or according to a specified valuation method. Another important consideration in the context of divorce is the issue of control and management of the business. In closely-held companies, where a small number of shareholders typically control the company, the transfer of shares as a result of divorce can have significant implications for corporate governance. Shareholder agreements often include provisions that address voting rights and the composition of the board of directors, which can become relevant in the event of a divorce. In some cases, spouses may be parties to a shareholder agreement together or may have entered into a separate agreement that governs their ownership interests in the company. In either scenario, the terms of the shareholder agreement will play a central role in determining how shares are treated in the divorce process. For example, if the shareholder agreement contains provisions restricting the transfer of shares or giving other shareholders a right of first refusal, those provisions will generally need to be respected in the divorce proceedings. However, it’s important to note that while shareholder agreements can provide valuable guidance and structure in the event of a divorce, they are not necessarily binding on the court. In some jurisdictions, the court does not have the authority to transfer title of shares from one spouse to another. However, if the parties enter into an agreement to transfer shares from one spouse to the other, the shareholder agreement becomes the governing instrument on effectuating the transfer. Ultimately, navigating shareholder agreements in the context of divorce requires careful attention to both the terms of the agreement itself and the applicable family law. Consulting with experienced legal counsel who can provide guidance on both corporate and family law issues can be essential in ensuring that the interests of all parties are protected and that the divorce process proceeds as smoothly as possible. By understanding the implications of shareholder agreements and how they intersect with divorce law, shareholders can better position themselves to protect their interests and preserve the value of their investments in the company.
March 14, 2024
Construction
A Primer on Preliminary Notice of Mechanics' Liens
Most contractors, subcontractors, and suppliers know that lien claims have strict deadlines, typically measured from the last date of work. But did you know that some states also require preliminary notice of lien rights upfront, at the first time of furnishing labor or materials? In 2017, Pennsylvania created an online registry known as the Construction Notices Directory that allows owners to register private projects that exceed $1.5 million. If a project is registered, all subcontractors and suppliers must file a Notice of Furnishing within 45 days of first providing labor or materials to the project; otherwise, the lien right will be lost. Recently, more owners have been registering projects. Thus, prompting the questions: Do other states have similar early notice requirements for preserving lien claims? And what steps should be taken in Pennsylvania when dealing with the Directory? Other States' Lien Claim Process and Notice Requirements Pennsylvania’s requirement for a preliminary notice at the start of work (only when a project is registered on the Directory) is atypical in the Mid-Atlantic. Neither Maryland, Delaware, the District of Columbia, nor New Jersey require any similar preliminary notice at the start of work. The only other Mid-Atlantic state with a similar requirement is Virginia, which requires a preliminary notice to be issued within 30 days of commencing work on a one- or two-family residential dwelling if the owner has identified a Mechanics’ Lien Agent in the building permit. Preliminary notices at the commencement of work are more prevalent in other regions of the country; for example, California requires a preliminary notice to be issued within 20 days of first furnishing labor or material to the project. The point is that while preliminary notice requirements are atypical in the Mid-Atlantic, they are required in other parts of the country. It has become more popular for owners to utilize the Pennsylvania Construction Notices Directory. Thus, it is best to stay current on preliminary notice requirements if working in multiple jurisdictions. Practical Tips for Handling Pennsylvania's Construction Notices Directory If a prime contractor works directly with the owner, recognize that it is ultimately the owner’s choice on whether to register the project. If the owner elects to register the project, a Notice of Commencement is filed on the Directory, and that document should become part of the Contract Documents. The best practice is to also identify in the special conditions of the contract the Directory listing. The Notice of Commencement must be posted at the project site. Additionally, statutorily mandated language must be included in all contracts that provide notice that a failure to file a Notice of Furnishing will result in a waiver of the lien claim. The notice of furnishing is only required to be filed by subcontractors and suppliers. For subcontractors, closely review the Contract Documents to identify any indication of the project being registered. It is also recommended to include in internal standard processes that the Directory be searched at the time of signing the subcontract and also at the time of commencing work. The Notice of Furnishing can be filed prior to starting work; thus, there is no need to wait or delay in properly filing the document. Properly noticing mechanics’ lien claims and preserving rights can be a complicated area of construction law. The best practice is to have sound internal protocols and trusted counsel for troubleshooting. Offit Kurman construction attorneys are available to advise and counsel contractors, construction managers, design-builders, design professionals, subcontractors, developers, and design professionals on construction contracts, risk, and project disputes.
March 14, 2024
Immigration Law
Unlocking Opportunities: Navigating National Interest Waivers (NIW) for STEM Professionals
As we explore the maze of U.S. immigration law, we come across a provision that makes it easier to bring exceptional professionals with special skills to the U.S. Through this provision, the National Interest Waiver (or NIW), individuals may be able to secure permanent more easily and faster than the traditional labor certification process for those in STEM fields (Science, Technology, Engineering, Mathematics), this provision may be the perfect fit. What is a National Interest Waiver? The National Interest Waiver is a unique provision within the U.S. employment-based immigration system, offering a streamlined route to permanent residency for individuals who can demonstrate their work's national importance. This waiver enables eligible applicants, including STEM degree holders, to bypass the labor certification process and job offer requirements. STEM Professionals and National Interest Waivers: Why should STEM degree-holders pursue the NIW? STEM degree holders are particularly well-positioned to benefit from the National Interest Waiver due to the inherent value of their contributions to the U.S. economy and society. Here's how STEM professionals can leverage the NIW: In-Demand Skills: STEM fields are consistently identified as high-priority areas by the U.S. government due to the demand for skills that drive technological innovation, research, and development. National Economic Growth: STEM professionals often contribute directly to economic growth by advancing cutting-edge research, developing new technologies, and fostering innovation, all of which align with the national interest. Job Flexibility: The NIW offers STEM professionals greater flexibility in their career choices, as it eliminates the need for a specific job offer from a U.S. employer. This flexibility allows individuals to pursue opportunities that align with their expertise and passion. Expedited Permanent Residency: With the NIW, STEM professionals can benefit from an expedited path to permanent residency, bypassing the lengthy labor certification process that is typically required for employment-based green cards. How to Qualify While the benefits are clear, it's essential for STEM professionals seeking a National Interest Waiver to meet specific criteria, including showcasing exceptional abilities or skills, demonstrating the potential to benefit the nation, and establishing the national interest in waiving the job offer and labor certification requirements. Applicants must hold a U.S. advanced degree (or foreign equivalent) followed by five years of professional experience. Those demonstrating exceptional ability must demonstrate that they have ten years of professional experience. Exploring the Specific Criteria for National Interest Waivers The National Interest Waiver (NIW) serves as a valuable pathway for individuals with exceptional abilities or skills, including STEM professionals, to obtain permanent residency in the United States. To qualify for an NIW, applicants must satisfy specific criteria established by the U.S. Citizenship and Immigration Services (USCIS). Let's dive into the details of these criteria: Exceptional Abilities or Skills: NIW applicants must demonstrate extraordinary abilities or skills in their respective fields. This can be evidenced through a combination of factors, including: Recognition and Awards: Receipt of major awards or prizes in the field. Publications: Authorship of scholarly articles, publications, or books in esteemed journals or platforms. Patents: Ownership or co-ownership of patents in the field. Significant Contributions: Evidence of significant contributions to the field, such as groundbreaking research or innovations. Critical Impact on the Field: Applicants must showcase the significance of their work and its impact on advancing the field. This can be demonstrated through:Citations and References: High citation counts and references to the applicant's work by peers and experts in the field. Research Collaborations: Participation in collaborative research projects with prominent institutions or researchers. Technical Contributions: Development of technologies, methodologies, or solutions that have had a substantial impact on the field. National Interest: The heart of the NIW application lies in demonstrating the national interest served by waiving the job offer and labor certification requirements. This involves:Economic Impact: Showing how the applicant's work directly contributes to economic growth, job creation, or competitiveness in critical sectors of the U.S. economy. Healthcare Advancements: Demonstrating contributions to healthcare innovations, treatments, or technologies that benefit the nation's public health. Environmental Sustainability: Highlighting efforts to address environmental challenges or promote sustainability practices that align with national priorities. National Security: Illustrating contributions to national security through research, technological advancements, or expertise in strategic areas. Comparative Assessment: Applicants must provide evidence that their contributions are unique and cannot be easily replicated by U.S. workers. This may include:Expert Testimonials: Letters of support from experts in the field affirming the applicant's exceptional abilities and the importance of their work, as well as documentation of at least ten years of full-time experience in the occupation. Market Demand: Demonstrating demand for the applicant's specialized skills or expertise in the U.S. job market. Navigating Education Requirements for National Interest Waivers In addition to showcasing exceptional abilities or skills and making significant contributions to their field, applicants for the National Interest Waiver (NIW) must meet specific education requirements as mandated by the U.S. Citizenship and Immigration Services (USCIS). Here's a detailed breakdown of the specific educational criteria for NIW eligibility: Advanced Degree or Equivalent: To qualify for an NIW, applicants are typically required to hold an advanced degree or its equivalent in a relevant field. This includes: Bachelor’s Degree or Master's Degree: Many NIW applicants possess a master's degree or higher in a field such as science, technology, engineering, mathematics (STEM), or a related discipline. A master's degree demonstrates a high level of expertise and specialization in the applicant's area of focus. Doctoral Degree (Ph.D.): Applicants with a doctoral degree, such as a Ph.D., are particularly well-suited for NIW eligibility due to the depth of knowledge and expertise gained through advanced research and academic study. Professional Degree: In some cases, applicants with professional degrees, such as a Doctor of Medicine (M.D.) or Doctor of Jurisprudence (J.D.), may also be eligible for an NIW if their work significantly benefits the nation and aligns with the national interest criteria. Field of Specialization: The applicant's advanced degree must be directly relevant to their area of expertise and the work they intend to pursue in the United States. USCIS evaluates whether the applicant's educational background aligns with the national interest served by waiving the job offer and labor certification requirements. Equivalency Evaluation (if applicable): For applicants educated outside the United States or with degrees from non-U.S. institutions, USCIS may require an equivalency evaluation to determine the degree's comparability to a U.S. degree. This evaluation ensures that the applicant's education meets the necessary standards for NIW eligibility and demonstrates the required level of academic achievement. Demonstrated Impact of Education: NIW applicants must provide evidence of how their advanced education and academic achievements have contributed to their exceptional abilities or skills and their potential to benefit the nation. This may include:Research and Publications: Highlighting academic research, publications, or thesis work that showcases the applicant's expertise and contributions to the field. Advanced Training or Specialization: Demonstrating advanced training, specialized coursework, or academic achievements that have enhanced the applicant's skills and knowledge in their area of specialization. Academic Awards or Honors: Providing evidence of academic awards, honors, or scholarships received in recognition of the applicant's educational achievements and contributions to the field. The National Interest Waiver (NIW) does not just expedite the immigration process of persons of extraordinary ability but also acknowledges that professionals in science, technology, engineering, and mathematics (STEM) are significant contributors to America’s future. In this era of innovation and technological advancement, the NIW becomes a means through which holders of STEM degrees can add value to the country while still being able to seek permanent residency. In an effort to influence their careers in the U.S. permanently, the National Interest Waiver (NIW) offers STEM professionals a chance to navigate through immigration intricacies with dexterity and intentionality.
March 13, 2024
Business
Is a Trust Better Protection Than a Prenup?
Business owners and families of wealth should know that a properly structured trust can be a very effective alternative to a pre-nuptial agreement. The Legal Intelligencer By Joe Armstrong Preparing for your child’s wedding should be a joyful experience, so it should come as no surprise when a family business owner avoids bringing up a prenuptial agreement. Business owners and families of wealth should know that a properly structured trust can be a very effective alternative to a prenuptial agreement. When one or more generations of a family have worked hard in business to accumulate substantial wealth, they will frequently ask their children to enter into prenuptial agreements to protect the family business and other assets in the event of a future divorce. For a first marriage of relatively young persons, the concept of a prenuptial agreement is frequently considered offensive and a topic to be avoided. Even the discussion between parent and child can be stressful and considered by the child to be undue pressure ahead of what they believe will be the happiest day of their lives. When met with these circumstances, counsel can help alleviate the family strife by suggesting the use of trusts to protect assets in the event of a divorce at least as effectively as an actual prenuptial agreement signed by those about to be married. This article discusses some of the many ways that a trust can be a very effective alternative to a prenuptial agreement. Each state has its own laws and customs regarding the division of property between divorcing spouses. These state laws can vary significantly (e.g., equitable distribution v. community property states), but they all will look at the extent to which a spouse owns or controls an asset and the right to receive income from that asset. It is the ownership or control of an asset by a spouse that will bring the asset within reach of a divorce court. This core concept of ownership or control is what allows a trust to be such an effective alternative to a prenuptial agreement. As a general proposition, if a divorcing spouse does not own or control a particular asset or the right to income from that asset, a divorce court will not attempt to award that asset to the other spouse. Just because a trust is established for someone’s benefit does not mean that the beneficiary automatically has ownership or control of the assets in the trust, or even the right to income generated by those assets. The key is structuring the trust in a way that does not give the spouse ownership or control over the assets in the trust while still giving the trustee broad discretion in how to utilize the assets for the benefit of the spouse. Revocable Living Trusts One of the most commonly used trusts is a revocable living trust or “RLT.” As suggested by its name, an RLT is fully revocable by the settlor and is typically used in conjunction with a simple will that leaves the assets of the testator to the RLT. Since an RLT does not provide savings on death taxes that can be achieved with a more complicated irrevocable trust, those without exposure to the federal estate tax often prefer an RLT as a cost-effective method to minimize the burden of the probate process and provide asset protection to the heirs. An RLT does not complete a transfer of assets during the lifetime of the settlor since by nature an RLT may be revoked at any time. An RLT can work well for the generation owning the family business or otherwise having substantial wealth with the intent to hold on to their assets until death. Irrevocable Trusts An RLT immediately becomes an irrevocable trust upon the death of the settlor since the trust can no longer be revoked. An irrevocable trust upon formation transfers assets of the settlor to the trust during the lifetime of the settlor (an inter vivos transfer). The use of an irrevocable trust allows for more complex tax planning to minimize the burden of estate, gift and generation skipping taxes on the beneficiaries and future generations. For those fortunate enough to have wealth beyond the amount of the lifetime federal estate and gift tax exemption ($13.61 million for an individual and $27.22 million for a married couple in 2024), an irrevocable trust with tax planning provisions will be the preferred form of trust to use in lieu of a prenuptial agreement. So How Does It Work? Whether using an RLT or one of the many varieties of irrevocable trusts, it all comes down to making sure the language of the trust document cannot be fairly construed to give the spouse, as beneficiary, ownership or control of the assets in the trust. The following are some of the key points to address when drafting a trust to have the same impact as a prenuptial agreement but without the angst that goes along with putting one in place. A Trustee You Can Trust Selecting a trustee that you can readily trust (for lack of a better word) to act in the best interest of the spouse as the beneficiary is critical. The more independent the trustee is from influence by the beneficiary, the better for protecting the assets from a divorcing spouse. A corporate trust company will be viewed as highly independent while a sibling of the beneficiary spouse may be considered more susceptible to influence by the beneficiary. Identifying the trustee is often the most challenging task for the family. When in doubt, select a corporate fiduciary with a long history of serving as a trustee for multiple generations of families of substantial wealth. No Absolute Right to Income or Principal Distributions Clients are often tempted to provide terms in their trust that will give their child as a beneficiary the right to withdraw some or all of the principal in the trust at certain ages or other milestones. Providing beneficiaries with the absolute right to income from the trust or the ability to withdraw principle from the trust can significantly weaken the asset protection characteristics of the trust and its effectiveness as a substitute for a prenuptial agreement. Giving withdrawal rights or the absolute right to income to beneficiaries of a trust indirectly gives them a degree of ownership or control over the assets of the trust that springs into existence when the stated age or milestone is reached. In a divorce court setting, one can expect a special master or judge to consider a spouse to own or control some or all of the assets in the trust. Once ownership or control is established, one must assume that the divorce court will look to find a way to include the value of the assets in the trust as being subject to some form of distribution to the other spouse in the divorce. In the end, a carefully crafted trust can be even better than a prenuptial agreement when seeking to protect assets in the event of a divorce. Reprinted with permission from the February 15, 2024, edition of The Legal Intelligencer © 2024 ALM Global Properties, LLC. All rights reserved. Further duplication without permission is prohibited, contact 877-256-2472 or asset-and-logo-licensing@alm.com.
March 7, 2024
Intellectual Property
Lights, Camera, Trademark: The Unsung Heroes of the Oscars
Oscar night is the most glamorous night in Hollywood. The red carpet. The gold statuettes. The gowns. The tuxedos. The stars. The trademarks. That’s right, the trademarks. They are essential to the movie industry, and when we celebrate the best in the movies, we should also celebrate the unforgettable trademarks that go along with the motion picture industry. The equipment used to make and show movies are all emblazoned with trademarks. We’ve all seen PANAFLEX or PANAVISION cameras in behind-the-scenes documentaries. Most of us have seen movies in IMAX, and we have heard movies in DOLBY SURROUND SOUND, DOLBY ATMOS, or DTS. Or maybe we’ve even seen a movie in CINEMASCOPE (Disney’s 20,000 Leagues Under the Seas, for example). We’ve probably watched movies with special effects from ILM, DIGITAL DOMAIN, and WETA. Almost all of us have seen a movie in an AMC or REGAL CINEMAS theater, or maybe we have seen where the stars have signed their names and left their handprints outside of GRAUMAN’S CHINESE THEATER in Los Angeles. That theater is so well-known that the look of the building is registered as a trademark. The studio and production company names that appear at the beginning of films are great examples of trademarks, indicating the source of the movie that viewers are watching. PARAMOUNT, PIXAR, WARNER BROTHERS, RKO, UNIVERSAL, SONY, COLUMBIA PICTURES, A24, ORION PICTURES, FOCUS FEATURES, BAD ROBOT, and AMBLIN are all trademarks. So are the roaring lion that introduces MGM films, the Twentieth Century Fox Fanfare, and Netflix’s “Tudum” sound. The water tower on the Warner Brothers lot is also a trademark. That brings us to the movies themselves. The U.S. Trademark Office will not register the title of a single work (this is true for books, too); rather, it will only register the title of a series (meaning two or more movies). While none of this year’s Best Picture nominees are part of a series, plenty of movie series titles are registered trademarks: BACK TO THE FUTURE, JURASSIC PARK, STAR WARS, MISSION: IMPOSSIBLE, DUNE, THE GODFATHER, BARBERSHOP, MADEA, and GODZILLA to name a few. Even some characters and props are the subjects of trademark registrations. Mickey Mouse, for one, is a registered trademark (trademark protection for characters is not always available). There are trademark registrations for multiple lightsaber hilts, as well as the X-Wing Fighter. In Europe, the owner of James Bond has a number of trademark registrations, including one for the well-known gun barrel sequence, and one for one the famous spy’s iconic poses. At least some movie brands have received legal advice and sought trademark protection. Thus, there are registrations for STAY PUFT (for marshmallows), STARK INDUSTRIES (for clothing), THE DAILY PLANET (also for clothing), WILLY WONKA (for candy), BUBBA GUMP (for restaurants), THE MIGHTY DUCKS (for hockey). Of course, we should not forget that Mattel has a trademark registration for the shade of pink associated with BARBIE. And yes, the golden statuette itself is a trademark, so all those who took one home took home a trademark. It’s the most glamorous night in Hollywood, and the trademarks have the best seats.
March 7, 2024
Estates and Trusts
Four Reasons Your Power of Attorney May be Out of Date
A financial Power of Attorney is an essential document in any estate plan. It enables you to appoint someone you trust to manage your finances and other legal matters in case you become unable to do so yourself. The person you name, called your “attorney in fact,” generally has broad powers to handle things like paying your bills, filing your taxes, accessing your safe deposit box, managing your investments, and even selling or mortgaging your house. A “Durable” Power of Attorney remains in effect even if you become incompetent, which is when the document is most likely to be needed. Because it may be years before your Power of Attorney is used, you should review it periodically to make sure it remains current. Here are four reasons to consider having your Power of Attorney revised: It is more than five years old. Unless the document states otherwise, a Power of Attorney technically remains valid indefinitely. Still, banks and other financial institutions may be skeptical if the document is more than five years old. Their skepticism may stem from a legitimate concern that the Power of Attorney has been revoked or perhaps superseded by a newer version of the document. It names the wrong people. Longtime partners and married couples often name each other as their attorneys, in fact, and another individual to act as a backup in case the partner or spouse isn’t able to do the job. If your marital status has changed since you had your Power of Attorney prepared, or if your backup attorney, in fact, has fallen out of favor, it’s time to rethink who should be in charge of your finances if you can’t be. It’s Not the Maryland Statutory Form. In October 2023, the Maryland Legislature adopted a new Statutory Power of Attorney. Under state law, Maryland’s banks, insurance companies, and brokerage firms are legally obligated to accept this statutory form. Anyone who refuses to honor the Statutory Power of Attorney can be forced to pay the attorney’s fees spent getting a court to require that they accept the document. Although other Power of Attorney forms are still valid in Maryland, having the statutory form will help to ensure that the document is honored without delay. It doesn’t include provisions for your digital assets. Digital assets include things like the electronic data stored on your computer or smartphone, your Internet accounts like LinkedIn and Gmail, and your online pictures and documents. Without explicit authorization, called “lawful consent,” no one can legally manage these assets for you if you become incapacitated. Some of these assets, like your PayPal or Amazon accounts, may have monetary value. Others, like your email account or personal blog page, could be of great sentimental importance. Even your voicemail account may be valuable if it includes messages from potential clients or expressions of support from loved ones during an illness. Only a newer Power of Attorney will include provisions for your digital assets, and it may be wise to have yours updated for this reason alone. It is also important to make a list of your passwords and login information. This should be kept in a safe place so your attorney, in fact, can find it when the need arises. Do you really need a Power of Attorney? Without one, it could be necessary for the court to appoint someone to become your legal guardian. A guardianship proceeding is an arduous and expensive process. In addition, the guardian would need to file annual accountings with the court to verify how your assets had been spent. Taking the time to have a Power of Attorney prepared—and to keep it current—is well worth the small effort required. Lee Carpenter is a Principal at the law firm of Offit Kurman, P.A., and can be reached at (410) 209-6426 or lee.carpenter@offitkurman.com. This article is intended to provide general information and should not be construed as legal advice.
March 4, 2024
Intellectual Property
Trademark Use in the U.S.
Demystifying What Constitutes an Acceptable Specimen of Use Evidence of use is, in most circumstances, essential to securing and maintaining a U.S. trademark registration. Subject to certain limited exceptions involving foreign trademarks, the U.S. Trademark Office will not issue a U.S. trademark registration without appropriate proof of use. Similarly, to maintain a U.S. trademark registration, a registrant must submit adequate proof of use to the Trademark Office. While this sounds straightforward, in practice, it can sometimes be very difficult to find evidence of use that the Trademark Office will accept. According to the Trademark Manual of Examining Procedure, § 904, specimens “are required because they show the manner in which the mark is seen by the public.” Acceptable specimens can be labels and tags affixed to goods or the containers for goods (but not mockups), stampings on products, commercial packaging, screenshots from a computer program or a frame of a movie or video, a website from which software can be downloaded, point of sale displays, catalogs with ordering information, websites from which products can be ordered, and manuals. TMEP §§ 904.03 (a) through 904.03 (k). On the other hand, printer’s proofs, mockups, renderings, and advertising materials are generally not acceptable as evidence of use. TMEP §§ 904.03 (a) through 904.03 (k). Once evidence of use is submitted, the Trademark Office will examine it carefully. If it is not accepted, an Office Action will be issued, after which one will have the ability to submit a substitute specimen that was in use as of the pertinent date (usually the date on which the original specimen was submitted). TMEP § 904.05. Obtaining an acceptable specimen is often one of the most difficult parts of preparing a trademark application or a maintenance filing. This is in part because the Trademark Office examines them so carefully but also partly because there is a desire to avoid the expense of repeated filings with the Trademark Office. Indeed, failure to submit an acceptable specimen can lead to the refusal of an application, as demonstrated by a recent case. Hi-Tech Pharmaceuticals, Inc. sought to register EXPERIMENTAL AND APPLIED SCIENCES as a trademark for use in connection with dietary and nutritional supplements. As evidence of use, it submitted an original specimen and a substitute specimen. The original specimen was five pages long, consisting of a screen capture of a web page showing five different products. The proposed mark did not appear on the first page, but it did appear on close-ups of two supplement bottles that were part of the specimen. The close-ups showed the proposed mark on the lower back portion of the label, on one line of a four-line group. All four lines were the same color, appeared in the same font size and style, and had the same justification. The proposed mark appeared at the end of the following sentence: “Developed and exclusively manufactured by Experimental And Applied Sciences”; because of its positioning, the proposed mark was on the second line. The next line had the applicant’s address, and the following line had the applicant’s phone number and website address. The Examining Attorney refused registration of the mark, taking the position that the evidence of use showed the proposed mark being used as a trade name, not as a trademark (the submitted evidence did not show the proposed mark anywhere else on the bottle). The Trademark Trial and Appeal Board affirmed on appeal, agreeing with the Examining Attorney that the “applicant would be hard-put to present the term in a less prominent manner.” (emphasis in original). The TTAB explained that the proposed mark appeared as part of a visual unit and that, as a result, the impression was that the proposed mark should be read in the context of the lines around it. Therefore, registration was refused. An acceptable specimen would have led to a different result. While the Hi-Tech Pharmaceuticals case was in the context of seeking registration of a mark, it applies with equal force to maintenance filings—an improper specimen can lead to the cancellation of a registration mark. Thus, in either context, it is important to work with experienced counsel to make sure that a mark is being used in a manner that demonstrates trademark use and that will be accepted by the Trademark Office. If there is any doubt about whether the Trademark Office will accept use, please contact me (preferably well in advance of any deadlines).
February 29, 2024
One Minute of Overtime
Primary Duty
Welcome to One Minute of Overtime, where I will share insights on Labor and Employment Law topics, mostly related to minimum wage and overtime compliance issues. Compliance in this area of law is nuanced and technical, so it is critical for employers to audit and adjust their practices to remain compliant, so stop by to stay up-to-date and in-the-know. Most exemptions under the FLSA focus on the employee’s primary duty. This means that even where an employee may do a variety of work, the exemption analysis will focus on the principal, main, major or most important duty that the employee performs.
February 28, 2024
Labor and Employment
Employment Law Update: Delaware Supreme Court Takes a Stand on Restrictive Covenants
In Cantor Fitzgerald, L.P. v. Ainslie, C.A. No. 9436 (Del. Jan. 29, 2024), the Delaware Supreme Court signaled to its lower courts that many well-drafted restrictive covenants remain valid and enforceable. The Cantor Court unanimously reversed the Delaware Chancery Court’s ruling, which had rejected as unenforceable a financial services company’s limited partnership agreement clause under which a limited partner’s equity is forfeited if the partner violates non-competition provisions. The decision is noteworthy because the Court of Chancery has increasingly demonstrated a willingness to strike down overly broad non-compete agreements, accompanied by a growing reluctance to revise (or “blue pencil”) agreements by narrowing their terms. The Court of Chancery held that the non-compete and non-solicitation provisions contained in the limited partnership agreement, which had a worldwide geographic scope, were geographically overbroad and unenforceable. Additionally, the Court of Chancery found the definition of “Competitive Activity” overbroad due to its inclusion of “any Affiliated Entity,” reasoning that “it is highly possible that a partner could unknowingly engage in a Competitive Activity.” 2023 WL 106924, at *18. Notably, the court declined to “blue pencil” the provisions to make them more reasonable. The Court of Chancery then focused on the forfeiture-for-competition provision triggered by “Competitive Activity.” The Court of Chancery considered whether it should evaluate the forfeiture-for-competition provision (which it called a “Conditioned Payment Device”) for reasonableness or apply contractual deference under the “employee choice” doctrine. The court determined that “forfeitures do not enjoy this Court’s contractarian deference” and conducted a reasonableness analysis. Id. at *24. Although the court applied a “lenient” reasonableness test, it nonetheless determined that the Conditioned Payment Device was unreasonable and invalid, given the broad definition of “Competitive Activity,” the lack of an established legitimate business interest for the broad restrictions, and the four-year temporal scope, which extended beyond the temporal scope of the contractual non-competition and non-solicitation provisions. Id. at *26. The Supreme Court disagreed, highlighting the distinction between non-competition clauses for former employees and those for former partners. It ruled that partnership agreements could include consequences not typical in standard contracts, like penalties and forfeitures. While the Delaware Supreme Court’s decision was specific to limited partnership agreements, employers should still take note. Put another way: while employment-based non-compete clauses are still subject to a reasonableness standard, the tides in Delaware may be shifting back towards the employer-friendly interpretation of restrictive covenants, at least for now (and until there is more clarity surrounding the FTC’s final rule). Moreover, such provisions may not be enforceable in specific industries, such as law firm partnership agreements where ethics rules may be implicated due to a chilling effect on a client’s right to select counsel. Furthermore, following the Cantor ruling, the Delaware Supreme Court accepted an interlocutory appeal regarding a Chancery Court ruling in Sunder Energy, LLC, v. Jackson, C.A. No. 455, 2023 (Del. Jan. 25, 2024). This case concerns the denial of a preliminary injunction to enforce a non-compete provision in a limited liability company agreement and a refusal to engage in blue-penciling. The Delaware Supreme Court’s stance on the matter remains to be determined. Given the current state of Delaware jurisprudence on restrictive covenants, employers must carefully consider any restraints on employee mobility. They should also give similar consideration to the choice of law and forum selection provisions contained in employment agreements. Thank you for reading our legal update- please get in touch with us if you have any questions or require any assistance. Sarah Goodman can be reached at sarah.goodman@offitkurman.com or 267-338-1319, and Charles McCauley can be reached at cmccauley@offitkurman.com or 484-531-1712.
February 27, 2024
Family Law
Navigating High-Asset Divorce Cases
High-asset divorces typically involve couples with substantial wealth, including real estate, investments, business interests, and other valuable assets. These cases require a meticulous approach to ensure a fair and equitable distribution of assets, spousal support, and child custody arrangements. Determining the value of complex assets such as businesses, stock options, and intellectual property can be challenging. Valuation experts may be required to assess the worth of these assets accurately. In some cases, spouses may attempt to conceal assets to reduce the amount subject to division. Uncovering hidden assets demands thorough financial investigations, and forensic accounting may be possible. The tax consequences of asset distribution need careful consideration. Dividing assets without a comprehensive understanding of tax implications can lead to unexpected financial burdens. When one or both spouses own a business, the division or buy-out of business assets becomes a critical issue. This involves assessing the business's value and determining the most equitable way to distribute ownership interests. High-asset divorces often involve substantial spousal support considerations. Calculating the appropriate amount requires a detailed analysis of each spouse's financial situation and needs. Your divorce attorney will help you engage the necessary financial experts, such as forensic accountants and valuation professionals. Comprehensive documentation of all assets, liabilities, and financial transactions is essential in determining the marital estate. Given the complexity of high-asset divorces, negotiation and mediation can be effective methods for reaching agreements outside the courtroom. This allows the parties more control over the outcome. Having a well-drafted prenuptial or postnuptial agreement can simplify the divorce process by establishing clear guidelines for asset division and financial arrangements. If you have such an agreement, you should provide a copy to your attorney. Each spouse should seek experienced legal representation with experience in high-asset divorces. Attorneys with expertise in this area can navigate the legal complexities and advocate for their client's best interests.
February 15, 2024
Intellectual Property
Upcycling, Customization, and Trademark Infringement
With its potential environmental and sustainability benefits, upcycling is a popular trend. Likewise, product customization, allowing consumers to express their own style, is also popular. As illustrated by two cases involving watches, both can give rise to claims of trademark infringement and counterfeiting. Rolex Watch USA, Inc. v. BecekerTime, L.L.C. BeckerTime is a seller of decades-old preowned watches containing Rolex parts. BeckerTime identifies such watches as “Genuine Rolex,” but they include both Rolex and non-Rolex parts. Before taking action, Rolex purchased two watches from BeckerTime. BeckerTime added diamonds as hour markers to the refinished watch dials by drilling holes in the dials and inserting aftermarket diamonds or other stones and settings in the holes. As part of the refurbishment process, BeckerTime strips the dial down to bare metal, and once the refurbishment is complete, it reapplies Rolex’s trademarks. When selling the modified watches, BeckerTime lists a retail price with a comparison price labeled as “New MSRP (if all factory)”— even though Rolex does not and has never sold a similar watch. Additionally, BeckerTime adds various non-Rolex parts (such as bezels with added diamonds, bands, or straps). BeckerTime issues an “Authenticity Guarantee” for each watch it sells and has held itself out as a “Certified PreOwned Watch Dealer” with a “Rolex Certified Master Watchmaker” even though Rolex has not certified BeckerTime or its watchmaker. Moreover, the parts added by BeckerTime are integral to the function of the watches and do not bear any markings indicating that BeckerTime is the source of the watches. To be sure, BeckerTime did indicate on its website that the replacement parts were not genuine Rolex parts, that the alterations it makes would void any Rolex warranty, and that BeckerTime is not affiliated with Rolex. That was not enough to stave off legal action. Rolex sued BeckerTime for trademark counterfeiting and trademark infringement in September 2020. After a bench trial, the court found that BeckerTime infringed Rolex’s trademark by counterfeiting Rolex watches and issued an injunction precluding BeckerTime from using Rolex’s trademark in specific ways. Both parties appealed, and the court of appeals largely upheld the injunction. The court of appeals explained that “BeckerTime does more than recondition or repair vintage Rolex watches.” According to the court of appeals, BeckerTime sold watches that were materially different from those sold by Rolex; the watches could not be called genuine Rolex watches. The court of appeals also pointed out that customers were confused as to whether the watches were entirely genuine Rolex and that BeckerTime had received complaints about the quality of the watches. As a result, the court of appeals affirmed the injunction, although it did instruct the lower court to clarify one point. Hamilton Intern. Ltd. v. Vortic LLC Like the BeckerTime case, this case also involved watches. The outcome was very different. Robert Thomas Custer founded Vortic and endeavored to make a watch that would be entirely made in America. After learning that no active company in the U.S. made watch movements, Vortic began salvaging and restoring parts from antique American-made pocket watches manufactured in the late 1800s and early 1900s. The parts, which included antique parts from watches bearing Hamilton’s trademark, were then encased in new wristwatches. One of the watches Vortic made was named “The Lancaster,” after the city where the Hamilton Watch Company was originally based. The Lancaster features restored antique pocket watch movements and front dials made by Hamilton. The front dial bears the HAMILTON trademark. The watch strap, case, and various internal parts were either manufactured by Vortic or came from modern U.S. sources. The back of the watch has a glass cover through which the watch parts, some of which bear the HAMILTON trademark, can be seen. The cover is surrounded by a metal ring with Vortic’s name and serial number for the watch, as well as the watch’s name. Buyers received the watch in a wooden box with Vortic’s name and a booklet that displayed the Vortic logo and explained its manufacture and restoration process. The box also included an authentication card with Vortic’s name and serial number, which was signed by the watchmaker. Vortic’s advertisements emphasized the antique and authentic nature of the watch’s parts. In July 2017, Hamilton sued for trademark infringement and counterfeiting. After a bench trial, the court ruled in favor of Vortic, finding that there was no likelihood of customer confusion. Hamilton appealed, and the court of appeals affirmed the lower court’s ruling. The court of appeals pointed out that Vortic took genuine parts from Hamilton watches, refurbished and repaired them, and modified them into a wristwatch and that consumers would view the watch as an antique pocket watch modified into a wristwatch rather than as an entirely new product. Further, the court of appeals explained that Vortic took many steps to disclose that it was not affiliated with Hamilton and that its watch used refurbished original parts. This could be seen in advertisements, the marks on the watch itself, and the fact that the watches themselves are presented to consumers as restored antique pocket watch parts modified into a wristwatch. The court of appeals contrasted this with other cases (including cases brought by Rolex) where there was no disclosure of the changes made to the watch and pointed out that there was no evidence of consumer confusion in the record. So, What Is Permitted? Anyone seeking to reuse a previously manufactured product or parts from a previously manufactured product should make sure to disclose to consumers exactly what has been done. Further, it is important to make clear that there is no affiliation between the upcycler/customizer and the original manufacturer. These seem to be the key differences between the Rolex decision and the Vortic decision. However, strict compliance with those requirements does not mean that reusing a previously manufactured product cannot give rise to a claim for trademark infringement. One thing that does seem settled is that customization of a product purchased by a consumer is permitted so long as the customized product is intended for the consumer’s own use and not for resale (in the BeckerTime case, it appears that BeckerTime was customizing watches for sale, rather than in response to consumer requests). If you are contemplating reusing someone else’s products or are concerned that a third party reusing your products will result in consumer confusion, please feel free to contact me.
February 14, 2024
Intellectual Property
Laughing in the Face of Copyright: The Unsettling Case of AI-Generated Comedy and Digital Immortality
George Carlin had quite the career. His seven dirty words routine was the centerpiece of litigation about the government’s power to censor indecent material on the airwaves that went up to the Supreme Court. He won awards for his comedy specials and albums (full disclosure: Jammin’ in New York is a personal favorite). He appeared in movies like The Prince of Tides, Bill & Ted’s Excellent Adventure, Cars (where he voiced Fillmore), and was the conductor on Shining Time Station. Carlin passed away in 2008, and he is now at the center of a new lawsuit raising questions about whether AI should be used to “resurrect” deceased artists, who controls the legacy of deceased artists, and who can profit from their “resurrection.” On January 9, 2024, Dudesy LLC (“Dudesy”) released an hour-long video entitled “George Carlin: I’m Glad I’m Dead (2024). The introductory voiceover explained that Dudesy, using some type of AI, fed George Carlin’s standup routines into the training database for the AI; the AI was then used to create the video. The introductory voice further stated, “I listened to all of George Carlin’s material and did my best to imitate his voice, cadence, and attitude, as well as the subject matter I think would have interested him today.” The video quickly made the rounds on social media. By January 25, Carlin’s estate, which had nothing to do with the video, filed suit against Dudesy and the individuals associated with the making of the video. The lawsuit, filed in federal district court in Los Angeles, asserts three claims: violation of the common law right of publicity, violation of the statutory right of publicity, and copyright infringement. The first two claims are based on the unauthorized use of Carlin’s name, voice, and likeness in the video. The third claim is based on the copying allegedly occurring when Carlin’s standup routines were fed into the AI to create the video. The lawsuit claims that Dudesy saw the video as a profit center, not just a way to make people laugh. Dudesy promoted the video with social media posts providing links to its online store and Patreon page from which subscribers can purchase monthly subscriptions. And a YouTube channel associated with Dudesy that posted videos relating to the hour-long special with the same hyperlinks and advertisements. Further, in anticipation of a likely claim that the video was a “fair use,” the lawsuit alleges that the video “has no comedic or creative value absent its self-proclaimed connection with George Carlin. It does not, for example, satirize Carlin as a performer or offer an independent critique of society.” In the wake of the filing of the lawsuit, Dudesy now claims that the video was not written by AI but instead by Chad Kultgen. Mr. Kultgen, together with Will Sasso, hosts the Dudesy podcast—a podcast that was used to promote the video. If it is true that a human wrote the script for the video, that might negate the copyright infringement claim insofar as it relates to the use of AI, but it still leaves Dudesy facing the California right of publicity claims for their efforts to “resurrect” George Carlin. The question of who, if anyone, has the right to “resurrect” a performer or personality depends on state law; slightly less than half of the states recognize a post-mortem right of publicity. The case neatly crystallizes the issues surrounding AI as it impacts the legacies of performers and other celebrities and touches on similar issues that were at the core of last year’s Hollywood strikes. Thirty years after it came out, the movie Jurassic Park remains prescient. And Dr. Malcom’s indictment of John Hammond and InGen applies with equal force to the burgeoning use of AI: “your scientists were so preoccupied with whether or not they could that they didn’t stop to think if they should.” If you need to talk with someone about whether or not you should, contact me or one of my intellectual property colleagues at Offit Kurman.
February 7, 2024
Construction
Avoiding Preconstruction Pitfalls (from the Contractor's Point of View)
It has become increasingly popular for private commercial construction projects to engage the contractor during preconstruction design early in the project. By doing so, the owner’s team and design professionals are able to work collaboratively and receive valuable feedback on key project details, such as constructability, schedule, early cost estimates, projected budgets, long lead items, and value engineering. This is true for any project delivery system that uses design assistance, delegated design, is a true design-build, is a CM at risk or CM as an advisor, or is a version of an integrated project delivery. But what happens if the owner tries to call an audible at the line of scrimmage and seeks to replace the contractor right before the construction phase begins? And what other pitfalls should a contractor be wary of if involved in preconstruction services? Precon, Not Freecon Some owners ask that preconstruction services be offered for free as a value-added customer service. Each project should be considered on a case-by-case basis. There might be projects and business reasons why that makes sense. Typically, however, it is best to avoid giving “freecon.” The preconstruction work is a valuable service, and there can be risk associated with it. Proper business relations should clearly define the scope, rights, and obligations regarding the preconstruction services and have an associated fee, typically done on an hourly or stipulated sum basis. Land Development, Design Assist, Delegated Design, or Design Build? The role, responsibilities, and scope of preconstruction services should be clearly identified in a contract so that there is no confusion about the exact services and risks being undertaken. Sometimes (but rarely), the contractor will assist the owner with land development, acquisition, usage, and zoning. Usually, however, the contractor is not involved in land development activities but instead will only provide services in relation to the preconstruction itself. If the contractor is only assisting and commenting on the design (design assist), that limited scope should be clearly stated. If any scope is delegated design, where the contractor will be responsible for furnishing the actual sealed/stamped design, or perhaps the contractor is responsible for a performance specification, it should be clearly stated. Furnishing of design should always be done by properly licensed professionals per any statutory laws. Intellectual Property Ownership of the Design One of the best approaches to protect the contractor from unpleasant surprises when furnishing any design is for the contractor to expressly remain the owner of the design intellectual property. If the intellectual property rights to the design will be assigned, it should be later in the project or at the end of the project. This ensures that the owner cannot receive a discounted design, remove the contractor, and then continue with the project, still using the original contractor’s design work. Similarly, whether furnishing the design or merely assisting, termination for convenience and “buyout” clauses help to protect the contractor from being unceremoniously removed from the project. Lastly, if furnishing the design, the final seal/stamp on the design should be the last thing and done very close in time with the submission of the design to the AHJ and the buyout/procurement phase. Unintentionally having a sealed/stamped design floating around without any future involvement in the project tends to lead to issues down the road. Clarifying the Guaranteed Maximum Price If using a GMP, it should be clearly defined in regards to evolving, unfinished design development. Also, it should be clear whether certain work or potential work is included in the GMP. Issues can arise when owners believe that the GMP includes the reasonably inferable, developing design (e.g., incomplete lighting package, which is often developed at the end of design), but the contractor believes that the incomplete design was not included in the GMP. For developing design, any placeholders, assumptions, budgets, qualifications, and exclusions should be clearly noted, and it should be clear how they relate to the GMP. Similarly, if using a GMP, there should always be a contingency. The contingency should be clearly defined both in terms of use and process, so that everyone is in agreement as to the type of work, issues, scope, and snafus that allow for application of the contingency. It is further recommended that the savings on the contingency be split in an agreed upon percentage ratio. By allowing the contractor to participate in the savings, it incentivizes the project to come in on budget and schedule. Assessing the risks and properly contracting for preconstruction services can be a complicated area of construction law. Best practice is to engage trusted counsel, insurance consultants, and other professionals. Offit Kurman construction attorneys are available to advise and counsel contractors, design-builders, CMs, design professionals, developers, and specialty trades on contract matters and project disputes.
February 7, 2024
Intellectual Property
Recipes, Trademarks and Décor
Feasting on the Lessons of Il Mulino’s Intellectual Property Battle When thinking about restaurants, most people think of a savory meal in a pleasant setting. I think about that, too, but more often than not, my thoughts turn to a restaurant’s intellectual property and what can be protected (a danger of the trade, I suppose). Restaurant names can be protected as trademarks, recipes as trade secrets, and the plating of an entrée may be protected by a design patent. A recent case involving the well-known Italian restaurant Il Mulino touches on many of these aspects of protection. Still, perhaps most interestingly, that case found that the look of the restaurant’s interior, its trade dress, is protectable. According to the court, this case is the latest in a long-running dispute over intellectual property relating to the Il Mulino restaurants. Defendants had been involved in opening and operating Il Mulino restaurants, an enterprise that involved various entities; one entity owned the intellectual property and licensed it to various locations. In 2020, some of the Il Mulino entities filed for bankruptcy. As a result of the bankruptcy, plaintiffs acquired those entities, including the entity that owned the intellectual property. The defendants opened Il Mulino Tribeca in 2018, and the location closed in September 2023. On September 15, 2023, the defendants opened a new Italian restaurant in the same space as Il Mulino Tribeca. The lawsuit was filed in November, with plaintiffs seeking to preliminarily enjoin the defendants from using proprietary recipes, certain restaurant names, the trade dress of Il Mulino Tribeca, a former Il Mulino location, and certain property from Il Mulino Tribeca in their new restaurant. Each claim warrants review, particularly the trade dress claim. The Trade Dress of Il Mulino Tribeca The court explained that the Plaintiffs defined the trade dress of Il Mulino Tribeca as consisting of the following elements: an art collection of black and white photographs arranged in a perfectly symmetrical design, covering almost one entire interior wall of the restaurant; custom artwork commissioned for Il Mulino Tribeca’s back wall that evokes the restaurant’s Tribeca home by referring to its location “Below Canal St[reet]”; (3) white-washed brick and high ceilings painted matte black; and unique, hand-blown glass pendants hanging near the entrance of the restaurant. All of the above appear in the Defendants’ new restaurant. The court found that the above definition was sufficiently precise and that the claimed trade dress was not functional. According to the court, “Il Mulino Tribeca’s décor plainly does not affect a customer’s “use or purpose” of the restaurant nor the cost or quality thereof. A customer could just as easily enjoy veal parmigiana in the absence of glass pendants or white-washed brick.” The court also pointed out that the trade dress analysis focuses on the trade dress as a whole, not particular elements that may be used by competitors. Finding that the trade dress was also inherently distinctive since it did not convey any information about the restaurant’s services or cuisine, the court concluded that the claimed trade dress was entitled to protection. Since the trade dress was entitled to protection, the court next determined whether there was a likelihood of consumer confusion. The court found that there was a likelihood of confusion even though the claimed trade dress was weak because there was little evidence that consumers associated the trade dress with Il Mulino. In reaching its finding, the court pointed out that the trade dress in the two restaurants was very similar (not surprising since the new restaurant opened in the exact location as the old restaurant and since social media posts for the new restaurant used images that seemed to draw on social media posts for Il Mulino Tribeca); that both restaurants were Italian; and that defendants seemed to be trying to capitalize on the reputation of Il Mulino. On that basis, the court found a likelihood of consumer confusion and preliminarily enjoined the defendants’ use of the claimed trade dress. Infringement of the IL MULINO Trademark The plaintiffs did not fare so well on their other claims. They claimed that the new restaurant’s name, Il Giglio, infringed on the IL MULINO trademark. Apparently, a prior restaurant affiliated with Il Mulino had operated under the name Il Giglio, but the court did not think consumers would associate the new Il Giglio with the old one. Likewise, the court pointed out that Il Mulino and the new Il Giglio used different fonts for their names and that “Mulino” and “Giglio” sound different and have different meanings. Proprietary Recipes The court seemed prepared to protect any of the plaintiffs’ proprietary recipes that the defendants might be using. However, in the court’s eyes, plaintiffs did not present sufficient evidence that the defendants were doing so—the claims were based mostly on the review of a menu and photos of similar-looking preparations of entrees. The court pointed out that neither party presented witnesses at the preliminary injunction hearing, and the plaintiffs did not seek expedited discovery before moving for a preliminary injunction. As a result, the evidence relating to the improper use of the plaintiffs’ proprietary recipes was insufficient. Interestingly, the court raised the possibility of a confusion-based theory as to the plating of dishes (particularly Il Mulino’s branzino) but did not pursue it since plaintiffs failed to develop it. Personal Property Finally, the court declined to enjoin the defendants’ use of certain personal property allegedly belonging to plaintiffs, such as tableware and tens of thousands of dollars of alcohol. According to the court, this personal property was not part of the trade dress, and plaintiffs could be compensated for the use of this property if its use was not enjoined. The court’s decision is a good example of the many different types of intellectual property a restaurant may have and how willing a court will be to protect that intellectual property. If you have questions about protecting your restaurant’s intellectual property or about someone who might be using your restaurant’s intellectual property without authorization, contact me or one of my intellectual property colleagues at Offit Kurman.
February 2, 2024
Elder Law and Advocacy
Aging in Place: NYFSC’s Home Sharing Program Offers a Unique Housing Solution for NYC’s Aging Population
The housing crunch in New York City is real. Exorbitant rents and climbing interest rates have led many further into debt, all but ruled out homeownership for most, and forced countless seniors to reconsider their plan to “age in place” in the space they have called home for decades. New York City’s Foundation for Senior Citizens (“NYFSC”) may have a solution in its established “Home Sharing Program.” What Is It?: NYFSC’s free Home Sharing Program has been in existence for the last 30 years. Its mission is to help link senior or adult “hosts” with unused private spaces in their homes or apartments with appropriate adult “guests.” The hosts and guests share their abode and the related expenses and perhaps forge a friendship along the way. The only age requirement is that both must be over the age of 18, and either the guest or host must be 60 or older. How Does It Work?: The NYC program (and similar programs in other cities) has a comprehensive screening process to match hosts with the right guests. Social workers provide a formal intake to screen applicants to consider lifestyle, work schedule, and collective needs for socialization. The host and the guest must have three solid professional recommendations and endorsements to ensure they are suitable candidates. The housing coordinators also assist with negotiating home-sharing and financial specifics to ensure the arrangement works for both parties. What are the Benefits?: Home or apartment sharing can provide homeowners and tenants additional income by renting out spare rooms and space. This is particularly helpful in expensive cities like NYC with high housing costs. The cost of long-term care is multiplying each year. Likewise, the guest’s contribution can ensure that a senior who no longer can afford to reside in their home can remain now that the guest is sharing the carrying charges of the home or apartment. Similarly, guests who find themselves out of options due to unaffordable rents might be able to find the perfect housing arrangement in a neighborhood that they thought was out of their reach. In addition to the obvious financial benefits, coordinated housing can foster a sense of community by connecting people who may not have otherwise interacted. When they work well, such arrangements can lead to the formation of relationships and mutual support between hosts and guests. This is particularly useful for seniors who tend to become more isolated as they age. Beyond companionship, there is a real opportunity, particularly in NYC, for cultural exchange and a richer understanding of different lifestyles and backgrounds, which can, in turn, contribute to a more diverse and interconnected community. In addition to building community and an exchange of cultures, an intergenerational arrangement may provide both parties the opportunity to give and receive advice from someone who is further on in life. Learn More: Certainly, this option is not for everyone, but perhaps it is an option that might work for those who wish to age in place as they age. For more information about this program or similar programs in your town or city, contact your local county office on Aging.
January 31, 2024
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