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Posts Tagged ‘email’

Florida Updates Its HOA Laws

Posted on: December 10th, 2018

By: Michael Kouskoutis

Earlier this year, Florida has enacted several laws impacting homeowners associations. Among these changes include the following:

As of July 1, 2018, Florida requires homeowners associations to publicly record all amendments to governing documents, where “governing documents” is defined to include “rules and regulations adopted under the authority of the recorded declaration, articles of incorporation, or bylaws and duly adopted amendments thereto.” Prior to this law, an HOA’s rules and regulations did not need public recording to take effect. Therefore, associations should publicly record such rules passed after July 1, 2018, especially prior to any attempt to enforce them.

Also as of July 1, 2018, association board members are not permitted to cast votes through email, and fines levied by the board and approved by the committee must be paid within 5 days after the committee’s approval. Moreover, amendments must be presented to voters with proposed changes either underlined or stricken, unless it would hinder the ability to understand the amendment, whereby a notation must be inserted before the proposal.

While these changes are not monumental, we still encourage homeowners associations to be mindful of them. If you have any questions or would like more information, please contact Michael Kouskoutis at [email protected].

Protecting In-House Correspondence from Disclosure: The Troublesome “CC”

Posted on: November 28th, 2018

By: Jake Carroll

Commercial disputes present complex issues of causation—what caused the accident, who is responsible, what is impacting company revenue. But before the dispute even arises, in-house attorneys are frequently copied on correspondence with team members and employees evaluating and offering opinions on causation, performance, and potential costs. Then, when the dispute or accident ends up in litigation, the materials prepared by the employees are sought in discovery.

For example, what if an engineering firm learns that one of its employees improperly installed a part of the anti-corrosion system for a pipeline. The employee’s supervisor prepares an email detailing all instances of improperly installed systems in the last four (4) years by the employee and decides to cc in-house counsel. Is this email protected from disclosure if a lawsuit arises from the improperly installed pipe system?

Claims of privilege and work product are often asserted when an in-house attorney is included as a secondary recipient—or CC—on an email, raising the question of what exactly is covered by the attorney-client privilege and work-product doctrine. Resolving these issues can be costly in their own right, and have the potential to derail an otherwise straightforward dispute.

While there are some exceptions, the general rule is that the communications where in-house attorneys are only CC’d are not protected from disclosure under either the attorney-client privilege or the work-product doctrine.[1]

The attorney-client privilege protects confidential communications that are sent for the purpose of securing legal advice.[2] However, when an email is neither addressed to the in-house attorney, nor sent directly to the attorney, it is unlikely that the privilege applies.[3] Similarly, the work-product doctrine protects correspondence or reports prepared in anticipation of litigation.[4] When an in-house attorney is only CC’d on correspondence, the emails are neither work performed by the in-house attorney, nor work prepared at the direction of the in-house attorney.[5] Additionally, many of these emails are typically sent prior to litigation and are not protected.

Businesses would do well to remember that simply copying your in-house attorney on an email will not shield its disclosure during discovery. The impact of this fact is far-reaching. In the example above, not only would the other side have an admission regarding the mislaid pipe from the supervisor, the email has also identified other projects where the business may be vulnerable to suit to a plaintiffs’ attorney.

If a company wishes for correspondence to be protected from disclosure, the following tips, though not exhaustive, are helpful:

  1. The sender of the email should direct correspondence to in-house counsel in a separate email—not by CC—and for the express purpose of seeking legal advice on a potential issue. For example, starting the email with “legal advice needed” or “request for legal advice” will go a long way to preserving the privilege and are more effective than “I have a question” or “see below.” Such requests should also be addressed specifically to the in-house attorney or an attorney on the legal team, rather than being directed to other employees with just a cc to the lawyer.
  2. To protect the privilege when using emails, avoid communications with both business and legal purposes as much as possible.
  3. Limit long email chains. Besides being good business practice, in-house counsel should not let privileged discussions continue in a long email chain. Inevitably, as the discussion continues, the topic may stray away from the original question and new people may be added to the email string—risking the privilege protection.

Protecting the attorney–client privilege and work-product privilege requires sound policies and procedures, a properly trained workforce and constant vigilance from the in-house attorney. But business that put procedures in place on the front end will find it well worth their time if and when a dispute arises.

If you need help with this issue, or any other commercial law questions, Jake Carroll practices construction and commercial law, is licensed to practice in Georgia and Florida, and is a member of Freeman Mathis & Gary’s Construction Law and Tort & Catastrophic Loss practice groups. He represents corporations and manufacturers in a wide range of litigation and corporate matters involving breach of contract, business torts, and products liability claims. He can be reached at [email protected].

 

 

[1] Minebea Co. v. Papst, 228 F.R.D. 13, 21 (D.D.C. 2005) (“A corporation cannot be permitted to insulate its files from discovery simply by sending a ‘cc’ to in-house counsel.”) (quoting USPS v. Phelps Dodge Refining Corp., 852 F.Supp. 156, 163-64 (E.D.N.Y.1994)).
[2] See e.g. Upjohn Co. v. U. S., 449 U.S. 383, 394-95 (1981).
[3] Id. at 394; In re Seroquel Prods. Liability Litig., 2008 U.S. Dist. LEXIS 39467, 2008 WL 1995058, at *4 (May 7, 2008) (explaining that “[t]here is general agreement that the protection of the privilege applies only if the primary or predominate purpose of the attorney-client consultation is to seek legal advice or assistance”) (quoting Paul R. Rice, Attorney-Client Privilege in the United States § 7:5).
[4] The work-product privilege is derived from the United States Supreme Court’s ruling in Hickman v. Taylor, 29 U.S. 495, 510-11, 67 S. Ct. 385, 393 (1947), and is codified in Fed. R. Civ. P. 26(b)(3).
[5] See Cox v. Adm’r U.S. Steel & Carnegie, 17 F.3d 1386, 1421-22 (11th Cir. 1994), opinion modified on reh’g, 30 F.3d 1347 (11th Cir. 1994) (recognizing that the work-product privilege protects from discovery “materials that reflect an attorney’s mental impressions, conclusions, opinions, or legal theories” that were prepared in anticipation of litigation and intended to remain confidential); cf. Hickman, 329 U.S. at 511, 67 S.Ct. at 393; Upjohn, 449 U.S. at 399, 101 S.Ct. at 687.

The Sixth Circuit Finds Coverage For Fraudulent Wire Transfer Under Crime Policy

Posted on: September 12th, 2018

By: Allen Sattler

Business email compromise (“BEC”) claims consist of incidents where cyber criminals access or use a company’s email system to commit a crime, usually for financial gain and often including the use of trickery to convince an employee to wire transfer corporate funds to the criminal’s account.  According to statistics reported by the FBI,  BEC claims are on the rise, especially in the last three years.  In 2016, there was a 2,370% increase in email account compromise attacks, involving losses of nearly $346 million, and the frequency of BEC claims continues to rise.

Several insurers offer coverage for BEC claims, including for losses sustained as the result of fraudulent wire transfer.  In American Tooling Center, Inc. v. Travelers Casualty and Surety Co. of Am., 5:16-cv-12108 (6th Cir 2018), the Sixth Circuit became the latest federal appeals court to interpret an insurance policy that included coverage for fraudulent wire transfers.  In a decision dated July 13, 2018, the Sixth Circuit ruled that the crime policy provides coverage for the loss incurred by the insured.

American Tooling Center (“ATC”), a Michigan manufacturer in the automobile industry, hired a Chinese company to manufacture stamp dies.  To receive payment for its work, the Chinese company would send invoices to ATC, and ATC would route payment to its vendor via wire transfer.  In 2015, a person outside the company intercepted an email from ATC to its vendor.  That person impersonated an employee of the vendor and told ATC that because of an audit, ATC should wire transfer payment on its outstanding invoices to a different bank account.  ATC complied with the instructions and wired over $800,000 to the thief’s bank account.  The thief was never identified, and the money was not recovered.

ATC made a claim to its insurer pursuant to a “Computer Fraud” provision of its crime policy to recover the money lost.  The insurer denied coverage, arguing that ATC did not suffer a loss until it eventually paid the outstanding invoices to the Chinese vendors, and that ATC therefore did not suffer a “direct loss” as required by the policy wording.  The insurer also argued that the acts by ATC in changing the bank account information without verification constituted intervening acts that break the chain of causation.  The Sixth Circuit disagreed, holding that ATC immediately lost the money when it wired the money to the thief, and that the thief’s instructions to ATC directly caused the loss.  The Court also rejected an argument by the insurer that the policy required that the thief first gain access to ATC’s computer systems prior to triggering coverage, and that here, the thief did not hack into the email system to commit the fraud.  The Court ruled that the policy language was not so limited.

The insurer sought reconsideration of the ruling, which the Sixth Circuit recently denied.

If you have any questions or would like more information, please contact Allen Sattler at [email protected].

If You Don’t Have Anything Nice To Say….You Probably Shouldn’t Post It!

Posted on: August 22nd, 2018

By: Shaun DaughertySamantha Skolnick

Mothers all over the world have admonished their children: “if you don’t have anything nice to say, don’t say anything at all.”  It may lose something when translated into some obscure dialects, but the sentiment was still there.  Now that we live in the age of technology, it appears that the old saying could use a facelift.  “If you don’t have anything nice to say, you should not type it anywhere on the internet.”  That is especially true if you are criticizing doctors and hospitals.

A wave of litigation has been emerging involving doctors and hospitals, but in these instances, they are not the targets, they are the plaintiffs.  Doctors and hospitals are starting to sue their patients for negative reviews on social media. The most recent example earned itself an article in USA Today where retired Colonel David Antoon had to pay $100 to settle felony charges for emailing his surgeon articles that the doctor found threatening as well as posting a list on Yelp of the surgeries the urologist had scheduled for the same time as his own.  Antoon alleged that his surgery left him incontinent and impotent and he had tried to appeal to the court of public opinion.

In other news, a Cleveland physician sued a former patient for defamation after the negative internet reviews of her doctor reached the level of deliberately false and defamatory statements. The case may be headed to trial in August. Close by, a Michigan hospital sued three relatives for Facebook posts and picketing which amounted to defamation, tortious interference and invasion of privacy. The family claimed that the hospital had mistreated their deceased grandmother.

We live in a country that ensures freedom of speech, and that right is exercised more than ever with the advent of social media and an ever-growing audience of participants.  However, there can be consequences if the speech is inaccurate or defamatory in nature.  While some attorneys, like Steve Hyman, cite the law in stating that “[t]ruth is an absolute defense. If you do that and don’t make a broader conclusion that they’re running a scam factory then you can write a truthful review that ‘I had a bad time with this doctor.’”  Other commentators, like Evan Mascagni from the Public Participation Project, tout avoiding broad generalizations, “If you’re going to make a factual assertion, be able to back that up and prove that fact.” That is defense against defamation claims 101.

The world of non-confrontational criticism on social medial makes it easy and tempting to post an emotionally fueled rant.  But beware!  You want to avoid a situation like that of Michelle Levine who has spent nearly $20,000 defending herself against a suit filed by her Gynecologist over defamation, libel, and emotional distress. The 24-hour rule is still a viable alternative to hitting “send” or “post.”  Type it out, let it sit and ruminate for a bit, and then decided if you are going to post the negative comments for the world to see.  Some opinions are worth sharing, or you may decide…. don’t say anything at all.

If you have any questions or would like more information please contact Shaun Daugherty at [email protected] or Samantha Skolnick at [email protected].

What Should I Do If The Government Invites Our Company To Participate In A Program?

Posted on: April 25th, 2018

By: Kenneth S. Levine

The FMG Immigration Section was recently asked to address a client’s question on how they should respond to an emailed “invitation” by the USCIS E-Verify Unit for their company to participate in a quality control program.  First, it is extremely important for clients to be aware that USCIS or ICE agency inquiries/requests are typically not sent by email.  This email turned out to be an exception.

Once we confirmed that the email was in fact legitimate, our focus shifted to the nature of the actual invitation.  In this case, the USCIS E-Verify Unit was inviting our client to participate in a quality control initiative meant to refine and improve the E-Verify system.  The invitation mentioned that participation was not mandatory, and that if our client decided to participate USCIS would then provide a list of corporate documentation to submit.

We advised our client to send a response confirming that the email had been received and that they’ve elected not to participate.  I have yet to run across any situation where it would be advisable for a company to willingly provide internal corporate documents based on nothing more than a government invitation. In fact, a standard rule of thumb is that a company should never provide internal records to a government agency absent a legal obligation to do so.

In the email USCIS sought to characterize their invitation as inconsequential and nothing to be concerned about.  However, the simple act of handing over records to USCIS could easily prompt an investigation if document errors/violations are discovered during the agency’s review.  While it is reasonable to assume that the government would be less aggressive or punitive under these circumstances, there are no guarantees.

Government emails soliciting companies to voluntarily submit their documentation for “quality control purposes” is a new and novel concept.   This type of invitation should always be turned down.

For additional information related to this topic and for advice regarding how to navigate U.S. immigration laws you may contact Kenneth S. Levine of the law firm of Freeman, Mathis & Gary, LLP at (770-551-2700) or [email protected]