CLOSE X
RSS Feed LinkedIn Instagram Twitter Facebook
Search:
FMG Law Blog Line

Posts Tagged ‘regulations’

DOL Fiduciary Rule Suffers a Slow Death

Posted on: May 15th, 2018

By: Ted Peters

In 2016, the U.S. Department of Labor (“DOL”) promulgated a set of rules and regulations now infamously referred to as the “Fiduciary Rule.”  After multiple criticism and legal challenges, the Fifth Circuit Court of Appeal struck down the Fiduciary Rule effective May 7, 2018.  Surprising many, the DOL elected not to challenge the Fifth Circuit ruling.  Even more surprising, however, was the bulletin issued by the DOL on the effective date of the court’s order.

The court’s ruling, which was not opposed by the DOL, left many unanswered questions.  Enter the DOL’s field bulletin.  Rather than admitting the total defeat of the Fiduciary Rule, however, the DOL seeks to maintain the status quo.  Specifically, the DOL announced that pending further guidance, advisors will not be penalized for either complying with the Fiduciary Rule, or ignoring it in favor of pre-existing standards.  Unfortunately, this announcement leaves the single most important question unanswered – what is the standard to which advisors will be held?  With the U.S. Securities and Exchange Commission working on its own set of rules, and the wait-and-see approach embraced by the DOL notwithstanding, only time will tell.

If you have questions or would like more information, please contact Ted Peters at [email protected].

FTC Guidance for Online Protection for Children

Posted on: May 14th, 2013

By: Matt Foree

A byproduct of widespread use of the internet is its inevitable use by young children. Today, children have access to the internet through computers, smartphones and countless other electronic devices. To protect the privacy of children online, Congress enacted the Children’s Online Privacy Protection Act (“COPPA”), which provides rules for operators of commercial websites and online services directed to or knowingly used by children under 13. COPPA required the Federal Trade Commission (“FTC”) to issue and enforce regulations concerning children’s online privacy. The FTC’s original COPPA Rule became effective on April 21, 2000.

Significantly, the FTC issued new, stricter rules under COPPA on December 19, 2012, the first time the rules have been amended since COPPA was enacted in 1998. (See video of Chairman John D. Rockefeller IV’s remarks regarding the amendment and the modernization of COPPA here.) Obviously, much of the relevant technology has evolved since COPPA was enacted. The new rules go into effect on July 1, 2013. The new rules can be found here. on the FTC’s website.

The stricter rules under COPPA came shortly after the FTC issued a report entitled “Mobile Apps For Kids: Disclosures Still Not Making the Grade” on the state of mobile app privacy protections for children in December 2012. This report characterized the results of its recent survey on mobile apps as “disappointing,” and noted that the mobile app industry “appears to have made little or no progress in improving its disclosures” since the FTC’s previous report.

Generally, COPPA applies to operators of commercial websites and online services, such as mobile apps, directed to children under 13 that collect, use, or disclose personal information from children, and operators of general audience websites or online services with actual knowledge that they are collecting, using, or disclosing personal information from children under 13. COPPA also applies to websites or online services that have actual knowledge that they are collecting personal information directly from users of another website or online service directed to children. “Personal information” includes, among other things, first and last name, a home or other physical address, a screen or user name, a telephone number, certain geolocation information, a social security number, and a photograph, video, or audio file that includes a child’s image or voice.

The rules provide that operators covered by COPPA must, among other things, post a clear and comprehensive policy describing their information practices for personal information collected online from children, provide direct notice to parents and obtain verifiable parental consent, with some exceptions, before collecting personal information online from children, and give parents access to their child’s personal information to review and/or have the information deleted.

The FTC has recently released a document providing further COPPA guidance.  Entitled “Complying with COPPA:  Frequently Asked Questions, a Guide for Business and Parents and Small Entity Compliance Guide” (the FAQ), this compliance document sets forth 92 frequently asked questions related to COPPA.  As stated in the document, the “primary goal of COPPA is to place parents in control over what information is collected from their young children online.”  The FAQ provides specific guidance about obligations regarding use or disclosure of previously collected information that will be deemed personal information once the amended rule goes into effect on July 1, as well as an explanation of the differences between the new and old COPPA rules.

The new COPPA rules provide pitfalls for covered operators of commercial websites and online services. Covered businesses should review COPPA and the FTC guidance to ensure compliance with COPPA, which authorizes civil penalties of up to $16,000 per violation. COPPA gives states and certain federal agencies authority to enforce compliance.

Temporary Flooding May Give Rise to a Takings Claim

Posted on: January 2nd, 2013

By: Ali Sabzevari

A fundamental part of our Takings Clause jurisprudence holds that when the Government physically takes possession of an interest in property for some public purpose, it has a duty to compensate the former owner.  There is a multitude of ways in which government actions or regulations may give rise to Takings Clause liability.  Recently, however, the United States Supreme Court directly addressed the issue of whether government-caused temporary flooding might amount to a compensable taking.

On December 4, 2012, the United States Supreme Court issued a decision, Arkansas Game & Fish Comm’n v. United States, which instructed lower courts not to be deterred from finding that government-caused temporary flooding may result in a taking under the Fifth Amendment of the U.S. Constitution.

The Supreme Court held that “government-induced flooding temporary in duration gains no automatic exemption from Takings Clause inspection.”  By doing so, the Court reversed a Federal Circuit decision which had found that flood conditions needed to be “permanent or inevitably recurring” before the resulting damage would constitute a taking under the Fifth Amendment.

Although Supreme Court precedent had already established that government-induced flooding could constitute a taking, and that a taking need not be permanent to be compensable, under the guise of Arkansas Game & Fish Comm’n, government-caused recurrent floodings, even if of limited duration, may give rise to Takings Clause liability.

Despite ultimately remanding the case to determine whether a taking had occurred, the Supreme Court, in emphasizing the case-by-case approach required to complete this task, highlighted several relevant factors to consider:

1)      Time or duration;

2)      Severity of the government interference;

3)      The degree to which the intrusion is intended or is the foreseeable result of authorized  governmental action;

4)      The character of the land at issue; and

5)      The owner’s reasonable investment-backed expectations regarding the land’s use.

Looking ahead, local governments should be cognizant that a temporary government-caused flooding may give rise to Takings Clause liability.

When is Medical Care Not an Emergency? Clever Lawyering Finds a Loophole in the Stringent Gross Negligence Standard

Posted on: November 5th, 2012

By: Mike Flint and Laura Broome

In 2005, the tort reform passed by the Georgia legislature included a statute that changed the standard for suing emergency room health care professionals in medical malpractice actions. The statute in essence states that no health care provider who provided emergency medical care in a hospital emergency department, or surgery suite, etc., after the patient has been treated in the emergency room, shall be held liable for an action in medical malpractice unless it is proven by clear and convincing evidence that the physician or health care provider’s actions showed gross negligence. The standard for liability of emergency medical care personnel was changed thereby from ordinary negligence by a preponderance of the evidence to gross negligence by clear and convincing evidence.

Case law further defines the new gross negligence proven by clear and convincing evidence standard as “that degree of care which every man of common sense, however inattentive he may be, exercises under the same or similar circumstances.” In other words, gross negligence has been defined as “equivalent to [the] failure to exercise even a slight degree of care.” “Clear and convincing evidence” is “a more stringent standard than ‘preponderating’ and requires a greater quantum and a high quality of proof in plaintiff’s favor.” As a result of this higher standard, there has been far fewer malpractice lawsuits filed against emergency room professionals.

Despite these hurdles, a recent trial suggests that a jury may be allowed to determine whether emergency medical care was provided in the emergency room, thereby triggering the higher standard in the first place. In the recent case, the plaintiff was presented to an emergency room with severe leg pain, but was sent home with a diagnosis of a skin rash, despite not being able to walk. The plaintiff later returned to the emergency room by ambulance after she was found unresponsive, and was determined to have severe blockage in her leg arteries. The plaintiff’s legs were both amputated below the knees a few days later.

Plaintiff’s counsel argued that the lower standard of ordinary negligence under a preponderance of the evidence standard should apply because the legal definition of emergency medical care does not include non-urgent patients in stable condition. Plaintiff’s counsel claimed that this plaintiff was considered to be a non-urgent patient in stable condition during her first trip to the emergency room.

The judge allowed the jury to decide whether the plaintiff received emergency medical care, and thus whether the gross negligence standard or ordinary negligence standard applied. The jury determined that the care the plaintiff received in the emergency room during the initial visit was not emergency medical care, and thus applied the ordinary negligence standard in the case.  In doing so, the jury further decided the emergency room defendants were negligent in failing to diagnose the plaintiff’s blocked arteries during the initial emergency room visit, and awarded $5 million to the plaintiff in damages.

It will certainly be interesting to see if other courts follow this lead in allowing juries to decide which standard applies.

California Becomes Third State to Limit Access to Employees’ Social Media Accounts

Posted on: October 1st, 2012

By: David Cole

On Thursday, Governor Jerry Brown signed a new law that significantly limits when California employers may ask employees and job applicants for social media information.  Under the new law, an employer cannot require or request an employee or job applicant to disclose his username or password, access a social media account in front of the employer, or share any social media content with the employer.  However, there is an exception that allows an employer to ask an employee to divulge social media that is reasonably believed to be relevant to an investigation of allegations of employee misconduct or employee violation of applicable laws and regulations, provided that the social media is used solely for purposes of that investigation or a related proceeding.  The new law takes effect January 1, 2013.

With this new law, California joins Maryland and Illinois as the first states to have laws restricting employer access to employees’ social media accounts.  Fittingly, Governor Brown announced the new law via Twitter, Facebook, Google+, LinkedIn, and MySpace, saying that this law, and a companion law that establishes a similar privacy policy for postsecondary education students, will “protect Californians from unwarranted invasions of their social media accounts.”