BLT: March 2015

Business & Corporate

Our Mini-Theme: Employee Benefits

Employee benefits and executive compensation continue to be evolving and diverse practice areas. A practice in employee benefits and executive compensation touches on myriad other dedicated practice areas: health law, taxation, information protection and privacy, trusts, and others. The Business Law Section’s Employee Benefits and Executive Compensation Committee is dedicated to keeping the Business Law Section current on these issues and is pleased to present this mini-theme to discuss general employee benefit topics. The four articles we present, described below, illustrate the broad implications of employee benefits and executive compensation in any business-focused practice.

Taxation

Your Partnership’s Employment Tax Debt May Come Back to Bite You

Betty J. Boyd

If you are a general partner, you can be liable for your partnership’s employment tax debt, even if there was no tax assessment or judicial action against you personally. Much of this tax debt may not be dischargeable in bankruptcy. This article presents a brief primer on employment taxes and its interaction with bankruptcy law, and comments on the In re Pitts case and the lessons it offers.

Business & Corporate

ESOPs: A Tax Advantaged Exit Strategy for Business Owners

Sharon B. Hearn

As business owners reach retirement age and seek liquidity for their life-long investments, many will need an exit strategy to transition ownership of their businesses. An employee stock ownership plan, or “ESOP,” may provide a practical exit strategy. This article will describe ESOPs, discuss how they provide a reasonable exit strategy for a business owner, and review the advantages and disadvantages of selling all or a portion of a business to an ESOP.

Business & Corporate

Affordable Care Act Considerations in Mergers and Acquisitions

Jason P. Lacey

The Affordable Care Act (ACA) creates new compliance obligations and risks that impact how health plans should be handled in mergers and acquisitions. This article provides some background on the aspects of the ACA that are most likely to raise issues in the M&A context and identifies key considerations at various stages of a transaction.

Taxation

Sections 409A and 162(m) of the Internal Revenue Code: Top Compliance Pitfalls

Compliance with Sections 409A and 162(m) of the Internal Revenue Code continues to challenge companies. This article highlights key Section 409A and Section 162(m) pitfalls and traps for the unwary and provides practical tips and strategies to help ensure compliance.

Real Estate

The TRIA’s Reauthorization and What It Means for the Real Estate Industry

Early this year, Congress and the president reauthorized the Terrorism Risk Insurance Act, which permits the federal government to supplement insurance losses resulting from catastrophic terrorist attacks after damages reach a certain threshold. While some consider the act to be an example of a federal “subsidy” to the insurance industry, others maintain that it is necessary to promote economic recovery in an age where damage from terrorist attacks is an ever-increasing reality.

Business & Corporate

Taming the Beast: Lessons in Civility from Zenith v. Matsushita

The behind-the-scenes activity at the trial court level in a case that has become famous for the U.S. Supreme Court’s ultimate decision in Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corp, illustrates how one federal judge fostered and maintained civility in one of this nation’s largest, most complex, and most contentious lawsuits, and in doing so, managed to bring a pair of lawsuits that had been pending for many years to a conclusion.

Business & Corporate

KEEPING CURRENT: Integrity Staffing Solutions, Inc. v. Busk: Employee Time in Security Screenings Not Compensable Work under FLSA

Jon D. Bible

Those who violate the FLSA may be assessed damages for unpaid overtime or minimum wages, liquidated damages equal to the amount of unpaid wages, and reasonable attorney fees and costs. Willful violations may carry criminal and civil penalties. While the command is simple – pay employees for their work – its implementation can be fraught with difficulties.

Business & Corporate

KEEPING CURRENT: Recent Ninth Circuit Opinion Could Have Broad Application to Antitrust Matters

The recent decision by the Ninth Circuit in St. Alphonsus Medical Center v. St. Luke’s Health System is instructive on a broad range of antitrust issues, offering lessons to companies from all industries. This article summarizes the main points discussed in the opinion and provides several key takeaways to help companies minimize antitrust risks in their own transactions.

Business & Corporate

DELAWARE INSIDER: What Statute of Limitations Applies? The Effect of the Delaware Borrowing Statute on Claims Governed by Foreign Law

Several recent decisions of the Delaware Court of Chancery demonstrate the sometimes unanticipated consequences that can arise where the Delaware statute of limitations is different than that of the law governing the contract at issue, and in particular, the effect of the Delaware Borrowing Statute in such situations.

Business & Corporate

ETHICS CORNER: Preventing Legal Malpractice and Disciplinary Complaints: Ethics Audits as a Risk-Management Tool

Susan Saab Fortney

A meaningful law firm risk-management system requires a periodic examination to monitor lawyers’ compliance. Although ethics audits take time and effort, they will reap benefits in terms of client and lawyer satisfaction, risk management, and malpractice prevention.

Business & Corporate

MEMBER SPOTLIGHT: An Interview with Chief Justice Leo E. Strine, Jr.

In February of 2014, Leo E. Strine, Jr. became the eighth Chief Justice of the Delaware Supreme Court, marking a long life of public service. Before the appointment, Chief Justice Strine served on the Delaware Court of Chancery as Chancellor and as Vice Chancellor. He also teaches at Harvard, University of Pennsylvania, and Vanderbilt Schools of Law. Since 2006, he has served as the special judicial consultant to the ABA Business Law Section's Corporate Laws Committee.

Business & Corporate

Inside Business Law (March 2015)

This month’s “Inside Business Law” highlights several recent newsletters: the Consumer Financial Services Committee, Cyberspace Law Committee, Middle Market and Small Business Committee, and White Collar Crime Committee; and previews the upcoming In the Know and BLS Spring Meeting.