The Lawletter Vol 44 No 3

Jim Witt—Senior Attorney, National Legal Research Group

            In Kimberley Rice Kaestner 1992 Family Trust v. North Carolina Department of Revenue, ___ N.C. App. ___, 789 S.E.2d 645, aff'd, ___ N.C. ___, 814 S.E.2d 43 (2018), cert. granted sub nom. North Carolina Department of Revenue v. Kimberley Rice Kaestner 1992 Family Trust, No. 18-457, 2019 WL 166876 (U.S. Jan. 11, 2019) the court addressed the issue of whether North Carolina's taxation under North Carolina General Statutes § 105-160.2 of the income accumulated by the trust in question met the minimum contacts requirement of the Due Process Clause of the Fourteenth Amendment to the U.S. Constitution where the trust's only connection with North Carolina was the residence and domicile of the beneficiary.

            The Trust, the Kaestner 1992 Family Trust, was established by Joseph Lee Rice III, with William B. Matteson as trustee. The situs of the trust was New York. The primary beneficiaries of the trust were the settlor's descendants (none of whom lived in North Carolina at the time of the trust's creation).

The Lawletter Vol 44 No 3

Suzanne Bailey—Senior Attorney, National Legal Research Group

            Title I of the Americans with Disabilities Act ("ADA"), 42 U.S.C. §§ 12111-12117, makes it unlawful for an employer to "require a medical examination" or to "make inquiries of an employee as to whether such employee is an individual with a disability or as to the nature or severity of the disability, unless such examination or inquiry is shown to be job-related and consistent with business necessity."  Id. § 12112(d)(4)(A). According to the Equal Employment Opportunity Commission ("EEOC"), this means that an employer should not make disability-related inquiries or require a medical examination of an employee unless the employer "has a reasonable belief, based on objective evidence, that: (1) an employee's ability to perform essential job functions will be impaired by a medical condition; or (2) an employee will pose a direct threat due to a medical condition." Enforcement Guidance:  Disability-Related Inquiries and Medical Examinations of Employees Under the Americans with Disabilities Act (ADA), 5 (EEOC No. 915.002 July 27, 2000).  A recent decision from the Fourth Circuit Court of Appeals reversing a grant of summary judgment in favor of the employer illustrates the difficulties employers face in navigating the ADA rules regarding required medical examinations of employees.

The Lawletter Vol 44 No 3

Charlene Hicks—Senior Attorney, National Legal Research Group

            One potentially overused legal principle that is often recited in appellate cases is that a party waives any issues or legal theories that he or she fails to assert at the trial court level. In other words, a party generally cannot raise a new issue for the first time on appeal. Any attempt to do so will likely be rejected by the appellate court.

            Even so, an appellate attorney would do well to keep in mind that this oft-repeated principle does not apply to certain situations, including questions pertaining to the standard of review employed by the lower court. The proper standard of review that is applicable to a particular legal issue is a nonwaivable matter. See Winfield v. Dorethy, 871 F.3d 555, 560 (7th Cir. 2017), cert. denied, 138 S. Ct. 2003 (2018); Gardner v. Galetka, 568 F.3d 862, 879 (10th Cir. 2009). Accordingly, an appellant does not forfeit a claim that the lower court failed to employ the proper standard of review “by failing to argue it” to the lower court. Sierra Club v. U.S. Dep't of Interior, 899 F.3d 260, 286 (4th Cir. 2018); see also United States v. Freeman, 640 F.3d 180, 186 (6th Cir. 2011). Similarly, the parties to a case cannot agree on or assign an incorrect legal standard of review to an issue. Sierra Club, 899 F.3d at 286.

The Lawletter Vol 44 No 2

Nadine Roddy—Senior Attorney, National Legal Research Group

            When an arbitration agreement is in effect, who decides whether an employment dispute—or any dispute for that matter—is arbitrable? The Supreme Court recently released a pair of decisions that address this issue under the Federal Arbitration Act (FAA), Henry Schein, Inc. v. Archer & White Sales, Inc., ___ S. Ct. ___, 202 L. Ed. 2d 480, 2019 WL 122164 (Jan. 8, 2019), and New Prime, Inc. v. Oliveira, ___ S. Ct. ___, 2019 WL 189342 (Jan. 15, 2019).

            Each case involved an arbitration agreement that contained a clause delegating the issue of arbitrability of disputes to an arbitrator rather than a court. The Supreme Court had previously held that such clauses are enforceable under the FAA. Rent-A-Center W., Inc. v. Jackson, 561 U.S. 63 (2010) (applying 9 U.S.C. § 2). Some courts of appeals developed an exception to this general rule, holding that a court need not grant a motion to compel arbitration under § 4 of the FAA if the argument that the underlying claim is within the scope of the arbitration agreement is "wholly groundless." These courts reasoned that such an exception would enable courts to block frivolous attempts to transfer disputes from the court system to arbitration.

The Lawletter Vol 44 No 2

Mark Rieber—Senior Attorney, National Legal Research Group

The Lawletter Vol 44 No 2

Jason Holder—Senior Attorney, National Legal Research Group

            Following an incident in which he allegedly grabbed, choked, and struck the mother of his children, Saylor Suazo (“Suazo”) was charged with a variety of crimes including assault in the third degree, unlawful imprisonment in the second degree, criminal obstruction of breathing or blood circulation, endangering the welfare of a child, menacing, and harassment in the second degree.  People v. Suazo, No. 117, 2018 WL 6173962, at *1 (N.Y. Nov. 27, 2018).  Immediately before the start of trial, however, the prosecution moved to reduce the charges to attempt crimes.  Id.  This reduction meant that Suazo now faced a maximum sentence of three months in jail and, more importantly, that the offenses could be tried without a jury pursuant to Criminal Procedure Law § 340.40(2).  Id. 

            Suazo challenged the reduction and continued to assert his right to a jury trial, arguing that he was a noncitizen charged with deportable offenses rendering any conviction sufficiently serious to mandate a jury trial under the Sixth Amendment.  Id.  In response, the prosecution argued that any deportation was merely a "collateral consequence" and not a criminal penalty for the purposes of the Sixth Amendment.  Id. 

The Lawletter Vol 44 No 2

Amy Gore—Senior Attorney, National Legal Research Group

            The Model Rules of Professional Conduct provide that “[t]o maintain the requisite knowledge and skill, a lawyer should keep abreast of changes in the law and its practice, including the benefits and risks associated with relevant technology.”  Model Rules of Prof’l Conduct R. 1.1 cmt. 8.  Maintaining computer security is both a business responsibility and an ethical obligation for all lawyers.  Additionally, attorneys are charged with the ethical obligation to make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation of a client.  Id. R. 1.6(c).  The need for attorneys to maintain current security protocols for the technology used in their offices has never been more pressing. 

            Computer “hackers” have infiltrated thousands of computer systems from private individuals to government entities, and litigation firms have increasingly been targeted.  A recent article highlights the story of several firms involved in litigation arising out of the 9/11 attack, including the ransoming of sensitive and confidential information that had been on the firms' systems.  Dan Packel, “Dark Overlord” Hack Shows Mounting Cyber Risks for Law Firms, The American Lawyer (Jan. 07, 2019).  In another case, hackers destroyed files of global law firm DLA Piper in 2017, requiring expensive and time-consuming reconstruction of systems and documents. 

The Lawletter Vol 44 No 1

Anne Hemenway—Senior Attorney, National Legal Research Group

          When a spouse places a Global Positioning Systems ("GPS") device in the other spouse's vehicle without consent to monitor that spouse's movements and position around town, the admissibility of the GPS data in the divorce trial is likely to be challenged. In United States v. Jones, 565 U.S. 400 (2012), the United States Supreme Court held that a GPS tracing device is a "search" under the Fourth Amendment to the United States Constitution, and absent a warrant allowing for the device to be used, data from the GPS device will be considered inadmissible.  Further, in Carpenter v. United States, 138 S. Ct. 2206 (2018), the United States Supreme Court held that the Fourth Amendment protections against search and seizure also requires the government to obtain a search warrant before acquiring cell phone data, which the Court analogized to GPS tracking data.

The Lawletter Vol 44 No 1

Matthew McDavitt—Senior Attorney, National Legal Research Group

            Sometimes, through ignorance or neglect, employers subject to the state statutory workers' compensation mandates fail to obtain or maintain the requisite insurance. Where employers subject to the system's mandates are found on the date of an employee's workplace accident (or other compensable event) to lack such insurance (either as a self-insurer or through a third-party insurer), such noncompliance with the workers' compensation insurance mandate has serious consequences for the employer.

First, a noncompliant employer loses a primary benefit of the workers' compensation system's exclusive remedy provision.  This provision bars injured workers from suing their employers in tort in exchange for statutorily defined wage replacement and medical benefits, thereby significantly limiting the potential legal exposure of the employer regarding such accidents.

The Lawletter Vol 44 No 1

Paul Ferrer—Senior Attorney, National Legal Research Group

         In a putative class action against Facebook, a federal district court in California has determined that "[i]ntrusion on privacy alone can be a concrete injury" for purposes of establishing standing to bring suit in federal court. Patel v. Facebook Inc., 290 F. Supp. 3d 948, 954 (N.D. Cal. 2018). In reaching that conclusion, the court applied the concreteness analysis laid out by Justice Alito in Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016).

         The judicial power of the United States resides in the federal courts and extends only to "Cases" and "Controversies." U.S. Const. art. III, § 2. Standing to sue is a doctrine "rooted in the traditional understanding of a case or controversy," and limits the category of litigants who can maintain an action in federal court. Spokeo, 136 S. Ct. at 1547. To have standing, a plaintiff must plead and prove three elements: (1) an injury in fact that is (2) fairly traceable to the defendant's conduct and (3) likely to be redressed by a judicial decision in the plaintiff's favor.