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Archive for July, 2020

Microsoft Takes Control of Domains Exploiting COVID-19 Crisis in Phishing Attacks

Posted on: July 17th, 2020

By: Barry Miller

Microsoft now controls several domain names that, according to the company, were used in attempts to get personal information from Microsoft account holders during the COVID-19 crisis.

A Virginia federal court issued a temporary restraining order July 7, finding good cause to believe that two John Doe defendants would likely violate federal law by using the domain names in phishing attacks. That order directed the registries to give Microsoft control over the hosting and administration of the offending internet domains.

The Court also unsealed Microsoft’s complaint. It alleges that the John Doe Defendants registered the domains such as “OfficeInventorys.com,” and “OfficeSuiteSoft.com,” using them to send emails “designed to look like they come from an employer or other trusted source.”

Links in those emails, if clicked, would lead the victim to servers hosting malicious web applications that interacted with Office 365 services. Those applications granted the criminals access to Office 365 accounts holding “email, contacts, notes and material stored in the victims’ One Drive for Business” or SharePoint, according to the complaint.

Microsoft’s Digital Crimes Unit began investigating these criminals in December 2019, according to a blog post from Tom Burt, Corporate Vice President, Customer Security and Trust. It blocked their activity but continued to monitor them. “Recently, Microsoft observed renewed attempts by the same criminals, this time using COVID-19 related lures in the phishing emails to target victims,” Mr. Burt’s post stated.

His post cited the FBI’s 2019 Internet Crime Report stating business email compromise attacks (BECs) are the most expensive complaints the Internet Crime Complaint Center receives. The FBI attributed losses exceeding $1.7 billion to BECs.

Mr. Burt pledged that Microsoft would continue to investigate and disrupt cybercriminals, but reminded users that cyber threats continue to evolve, making it “more important than ever to remain vigilant against cyber attacks.”

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

Additional Information:

FMG has formed a Coronavirus Task Force to provide up-to-the-minute information, strategic advice, and practical solutions for our clients. Our group is an interdisciplinary team of attorneys who can address the multitude of legal issues arising out of the coronavirus pandemic, including issues related to Healthcare, Product Liability, Tort Liability, Data Privacy, and Cyber and Local Governments. For more information about the Task Force, click here.

You can also contact your FMG relationship partner or email the team with any questions at [email protected].

**DISCLAIMER: The attorneys at Freeman Mathis & Gary, LLP (“FMG”) have been working hard to produce educational content to address issues arising from the concern over COVID-19. The webinars and our written material have produced many questions. Some we have been able to answer, but many we cannot without a specific legal engagement. We can only give legal advice to clients.  Please be aware that your attendance at one of our webinars or receipt of our written material does not establish an attorney-client relationship between you and FMG. An attorney-client relationship will not exist unless and until an FMG partner expressly and explicitly states IN WRITING that FMG will undertake an attorney-client relationship with you, after ascertaining that the firm does not have any legal conflicts of interest.  As a result, you should not transmit any personal or confidential information to FMG unless we have entered into a formal written agreement with you. We will continue to produce education content for the public, but we must point out that none of our webinars, articles, blog posts, or other similar material constitutes legal advice, does not create an attorney client relationship and you cannot rely on it as such. We hope you will continue to take advantage of the conferences and materials that may pertain to your work or interests.**

Are “Flat Fees” For Legal Services Okay in California?

Posted on: July 15th, 2020

By: Greg Fayard

Many lawyers in California charge their clients “flat fees.” That is, immigration lawyers, criminal defense lawyers, bankruptcy and estate planning lawyers, and patent lawyers all routinely charge “one price” for all services, regardless of the time it took the lawyer to do the work.

Under the old rules of Professional Conduct for California lawyers, if a lawyer received a flat fee, the rules were silent on where to put those funds—the lawyer’s trust account or operating account? Under the current rule, Rule 1.15, flat fees MAY go into the lawyer’s operating account.

Flat fees over $1,000 can go into the operating account provided the lawyer discloses in writing that the fee MAY go into the client’s trust account until earned and the client is entitled to a refund of any amount that is unearned.

If the lawyer does not have this disclosure in writing, which the client must sign, flat fees over $1,000 MUST go into the lawyer’s trust account.

Fortunately, the California State Bar has ethics guidelines to help lawyers determine what part of a flat fee is earned and when. For those California lawyers who charge flat fees, please read Rule 1.15 to make sure you are in compliance.

If you have any questions or would like more information, please contact Greg Fayard at [email protected], or any other member of our Lawyers Professional Liability Practice Group, a list of which can be found at www.fmglaw.com.

Who Falls Within The Ministerial Exception? Look To The Job Duties, Not The Job Title

Posted on: July 14th, 2020

By: Michael Hill

The Supreme Court has clarified the so-called “ministerial exception” to federal employment laws, such that it is not necessarily limited to leadership positions in a religious institution. In Our Lady of Guadalupe School v. Morrissey-Berru, the Court held that the employment relationship between a religious organization and an employee who performs core religious duties, regardless of job title, is protected from government scrutiny. This means that federal employment discrimination laws are inapplicable to these employment relationships.

The ministerial exception derives from the First Amendment right to free exercise of religion. It is the separation of church and state put into practice. Since the Constitution forbids the government from establishing a religion, or impermissibly intermingling in religious affairs, the government cannot tell a religious organization whom it can or cannot employ to perform vital religious functions. To allow such government interference would threaten the very independence of religion that the First Amendment was designed to protect.

Some courts previously thought this exception applied only to “leadership” positions in a religious organization. Indeed, this was the dissent’s primary argument. The plaintiffs in Our Lady of Guadalupe School and the consolidated case of St. James School v. Biel both were teachers in parochial schools who alleged claims of unlawful discrimination in their employment (one based on age, the other based on disability). Neither employee had the title of “minister.” Yet the Supreme Court held that official job title is not dispositive. What matters for the ministerial exception is what the employee does. The teachers in these schools played a vital role in educating and guiding their students in the faith. That factor, for the majority, should be the focus of the analysis. The majority also held that courts should give deference to a religious institution’s explanation of the role its employees play in the life of the religion in question. Because the ministerial exception applies to these positions, the federal discrimination laws under which the plaintiffs sued have no authority.

For religious organizations, the ministerial exception can be a powerful defense to claims of unlawful employment discrimination. Looking forward, the Court’s opinion in Our Lady of Guadalupe School opens the door to applying the ministerial exception to other job positions, not just to parochial-school teachers, so long as the employee’s job involves performing vital religious duties. Such employers should review the job positions in their organization and seek the advice of counsel to be sure they are applying the law correctly.

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

New Jersey and COVID-19: What Businesses Need To Know About Reopening Plans

Posted on: July 13th, 2020

By: Ashley Hobson

New Jersey has been one of the most proactive and reactive states amidst the COVID-19 pandemic. As of the publication of this Blog, the State has only entered into the second stage of its reopening, which still excludes indoor dining and attendance at bars, indoor exercise at gyms and other fitness studios, and attendance at nightclubs.

As the state continues to slowly reopen its doors, employers must be keenly aware of the many regulations imposed on newly reopened facilities. Not only are New Jersey businesses advised to follow CDC and OSHA Guidelines in reopening their businesses, they must follow guidelines imposed by the state.  Despite the initial closure of many retail operations, on April 15, 2020, Executive Order No. 122 provided a short, but comprehensive list of cleaning requirements for business that remained open and those that would eventually reopen. The guidelines include, but are not limited to, routine cleaning and disinfecting of highly touched areas, maintaining routine cleaning procedures in areas that are not highly touched, and ensuring there are enough workers to implement the cleaning protocols.

As employees remain cautious about a return to work, many employees across the state, however, remain unable to return to their positions because their employers can only reopen as a part of the 3rd stage of Governor Phil Murphy’s plan.  As a result, the current employment rate increased to 15.2% in May 2020, which represents a drastic increase from 3.3% in the prior year.

To continue to prepare for the growing number of the unemployed, on July 1, 2020, New Jersey’s Department of Labor expanded the number of eligible weeks for a claimant by 20 weeks. The additional 20 weeks will begin after the claimant has exhausted the initial 26 weeks of the state’s unemployment and the 13 weeks of the federal Pandemic Emergency Unemployment Compensation (“PEUC”).

In addition to the additional state benefits, the Department of Labor and Workforce Development announced that eligible workers will be able to receive a larger percentage of their wages under the Temporary Disability Insurance and Family Leave Insurance programs. The changes to the legislation will provide:

  • Workers with up to 12 consecutive weeks of Family Leave Insurance or 56 days of intermittent days and
  • Increase of the maximum benefit amount to 85% of the employee’s average weekly wage with a maximum of $881 per week.

The increased benefit amount and time adds to the growing list of protections under New Jersey’s ever-expanding protections for the employed and unemployed. It will remain to be seen if additional expansions will be announced after the expiration of the additional 20 weeks of unemployment compensation and if the state will also increase the benefit amount as the unemployment rate continues to hover in the double digits.

All of these new changes remind employers that they must remain vigilant in understanding their obligations during these very unusual times.  Of course, if you have any questions, please contact one of our New Jersey Labor & Employment team members.

Additional Information:

FMG has formed a Coronavirus Task Force to provide up-to-the-minute information, strategic advice, and practical solutions for our clients.  Our group is an interdisciplinary team of attorneys who can address the multitude of legal issues arising out of the coronavirus pandemic, including issues related to Healthcare, Product Liability, Tort Liability, Data Privacy, and Cyber and Local Governments.  For more information about the Task Force, click here.

You can also contact your FMG relationship partner or email the team with any questions at [email protected].

**DISCLAIMER:  The attorneys at Freeman Mathis & Gary, LLP (“FMG”) have been working hard to produce educational content to address issues arising from the concern over COVID-19.  The webinars and our written material have produced many questions. Some we have been able to answer, but many we cannot without a specific legal engagement.  We can only give legal advice to clients.  Please be aware that your attendance at one of our webinars or receipt of our written material does not establish an attorney-client relationship between you and FMG.  An attorney-client relationship will not exist unless and until an FMG partner expressly and explicitly states IN WRITING that FMG will undertake an attorney-client relationship with you, after ascertaining that the firm does not have any legal conflicts of interest.  As a result, you should not transmit any personal or confidential information to FMG unless we have entered into a formal written agreement with you.  We will continue to produce education content for the public, but we must point out that none of our webinars, articles, blog posts, or other similar material constitutes legal advice, does not create an attorney client relationship and you cannot rely on it as such.  We hope you will continue to take advantage of the conferences and materials that may pertain to your work or interests.**

Are Construction Codes Copyrightable?

Posted on: July 10th, 2020

By: Catherine Bednar and Kathleen Cusack

A case pending in the Southern District of New York is exploring the question of whether model construction codes can be copyrighted.  The case, International Code Council v. UpCodes, was filed in 2017 and debates whether various construction codes that were drafted by a non-governmental entity, International Code Council (ICC), are protectable by copyright. 

ICC is a non-profit corporation that develops model codes, which it calls “I-Codes”.  I-Codes include, for example, the International Building Code, International Plumbing Code, International Mechanical Code and International Zoning Code.  ICC develops the I-Codes and routinely publishes updated versions to reflect changes in the industry.  ICC offers users free copies of current codes, as well as versions of a few select codes showing historical changes.  ICC allows jurisdictions to incorporate I-Codes by reference rather than draft unique codes and standards. 

While UpCodes provides free access to the I-Codes, it charges users for the ability to search, bookmark, highlight, and comment.  ICC claims that UpCodes infringed its copyrights by posting: (1) I-Codes online without ICC’s permission, (2) state and local building codes that incorporate I-Codes by reference, and (3) unadopted model code with “redline” formatting to show differences in state or local codes.  On May 26, 2020 the Southern District of New York denied both parties’ motions for summary judgment.  Although the May 26 decision is not the final ruling in the case, the court noted that “if Defendants are liable for copyright infringement, it will not be for accurate copying of the I-Codes as adopted [into law].” 

In its decision, the district court relied on a recent Supreme Court decision published in April 2020, Georgia v. Public.Resource.Org.  In that case, the Supreme Court held that annotations to public code that were drafted under the supervision of the Georgia legislature were ineligible for copyright protections because they are not “original works of authorship” as defined in the Copyright Act.  Following the logic of earlier Supreme Court precedent that legal explanations are not copyrightable if penned by judges who possess authority to make and interpret the law, the court held that explanatory legal materials created by a legislative body are similarly ineligible.  The court explained, “If judges, acting as judges, cannot be ‘authors’ because of their authority to make and interpret law, it follows that legislators, acting as legislators, cannot be either. . . . In the same way that judges cannot be authors of their headnotes and syllabi, legislators cannot be the authors of (for example) their floor statements, committee reports, and proposed bills.” The Court was unpersuaded by Georgia’s argument that annotations in all forms are protectable, explaining that the pertinent question was authorship rather than the type of work produced.

The ICC v. UpCodes case differs from Georgia v. Public.Resource.Org. because the ICC is not a governmental body.  UpCodes is nonetheless encouraged by the Supreme Court case, citing it as validation that “no one can own the law.” The Southern District of New York noted in its May 26 judgement, however, that simply because “a law references a privately-authored, copyrighted work does not necessarily make that work ‘the law,’ such that the public needs free access to the work.”  The court specified that such a work might become the law if, for example, the private author intended the work to be adopted into law, “the work comprehensively governs public conduct,” the work expressly regulates an industry, the work provides for penalties or sanctions in the event that its rules are violated, and the work is identified as part of the law rather than as a copyrighted work.

The ongoing ICC v. UpCodes litigation will resolve the fact-dependent questions as to what was copied and whether UpCodes violated copyright law. The decision in ICC v. UpCodes could create cost-saving opportunities for members of the construction industry, who must often purchase multiple codes governing their projects.

If you have questions or would like more information, please contact Catherine Bednar at [email protected] or Kathleen Cusack at [email protected]