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    The Lawletter Blog

    PROPERTY: Virginia Civil Forfeiture Eclipsed by Tenancy-by-Entirety Immunity

    Posted by Trish Sifka on Thu, Apr 8, 2021 @ 10:04 AM

    The Lawletter Vol 46 No 3

    Trish Sifka—Senior Attorney, National Legal Research Group

            An English Judge and Jurist, Sir Edward Coke, declared in 1604: “[T]he house of everyone is to him as his Castle and Fortress as well for defence against injury and violence, as for his repose[.]” This famous quote from the Court of King’s Bench has been simplified to essentially mean that “every man’s home is his castle” and, thus, deserves special protection. Sir Coke stated this as part of his ruling in Peter Semayne v. Richard Gresham & Estate of George Berisford. Gresham and Berisford were joint tenants of a house in Blackfriars, London. Berisford died while still owing a debt to Semayne, so Semayne sued for writ of attachment against the home.

            In Virginia, real property held as tenancy by the entirety is especially sacrosanct. Where a tenancy by the entirety in the fee simple is created, the property is completely immune from the claims of creditors against either husband or wife alone. Rogers v. Rogers, 257 Va. 323, 512 S.E.2d 821 (1999); Pitts v. United States, 242 Va. 254, 408 S.E.2d 901 (1991). “The tenancy by the entirety may be severed only by mutual consent of the spouses or by divorce.”  In re Bunker, 312 F.3d 145, 151 (4th Cir. 2002); see also In re Sampath, 314 B.R. 73, 92 (Bankr. E.D. Va. 2004) (“The tenancy by the entirety estate retains its full vitality in Virginia.”). Accordingly, a spouse cannot waive contest to forfeiture of real property held as tenancy by the entirety in a plea agreement because that would result in severing of the title without the other spouse’s consent.

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    Topics: property, civil forfeiture, Trish Sifka, tenancy by the entirety, state forfeiture actions, property owner's rights

    EMPLOYMENT: Exotic Dancers—Employees or Independent Contractors?

    Posted by Nadine Roddy on Thu, Apr 8, 2021 @ 10:04 AM

    The Lawletter Vol 46 No 3

    Nadine Roddy—Senior Attorney, National Legal Research Group

                An exotic dancer was an "employee" of an adult entertainment club under the Fair Labor Standards Act ("FLSA"), even though a written agreement disclaimed an employment relationship, a federal district court sitting in Florida recently held in Schofield v. Gold Club Tampa, Inc., No. 8:19-CV-3097-VMC-TGW, 2021 WL 533540 (M.D. Fla. Feb. 12, 2021). The summary judgment evidence showed that the economic reality of the relationship was one of employer and employee given the degree of control over the dancer's work exercised by the club, among other factors.

                An exotic dancer who worked at an adult entertainment club brought suit against the club owner and its operator ("club"), seeking a ruling that she had been misclassified as an independent contractor, that she was the club's employee, and that she was thus entitled to employee's protections under the FLSA.

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    Topics: employment law, Nadine Roddy, FLSA, employee vs. independent contractor, adult entertainment club, degree of control

    GIFTS: Beneficiaries/Disqualification to Take/Ingratitude

    Posted by Matthew T. McDavitt on Thu, Apr 8, 2021 @ 09:04 AM

    The Lawletter Vol 46 No 3

    Matt McDavitt—Senior Attorney, National Legal Research Group

                It is well-settled that in most states, completed inter vivos gifts are deemed irrevocable, even in circumstances where the donor’s relationship with the donee later deteriorates or the purpose of the gift dissipates. “Many gifts are made for reasons that sour with the passage of time. Unfortunately, gift law does not allow a donor to recover/revoke an inter vivos gift simply because his or her reasons for giving it have soured.” Dayal v. Lakshmipathy, 2020-Ohio-5441, ¶ 37, 163 N.E.3d 683 (quotation formatting and citations omitted). However, Louisiana has a unique statute that allows completed lifetime gifts to be revoked upon proper facts showing “ingratitude” to the donor, either through attempted murder or through cruel treatment, where an action is brought within a year of the injurious act or imputed knowledge of such.

    Revocation on account of ingratitude may take place only in the following cases:

    • If the donee has attempted to take the life of the donor; or
    • If he has been guilty towards him of cruel treatment, crimes, or grievous injuries.
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    Topics: Matthew T. McDavitt, inter vivos gifts, ingratitude, Louisiana revocation

    CIVIL PROCEDURE: Responding Competently to Incompetently Drafted Pleadings

    Posted by Lee P. Dunham on Thu, Apr 8, 2021 @ 09:04 AM

    The Lawletter Vol 46 No 3

    Lee Dunham, Senior Attorney, National Legal Research Group

                As most seasoned practitioners are all too aware, it is often more time- consuming and frustrating to litigate a case against an incompetent pro se party or opposing counsel than it is to oppose a good lawyer. A litigant who is sloppy, mentally unwell, or who has very little understanding of the law can simply invent fictions faster than a competent and ethical attorney can refute them. Luckily, such a litigant often reveals his or her incompetence immediately through his or her pleadings. The best way to limit wasted time is usually to attempt to dispose of as much of the case as possible “on the papers.” Dismissal is, of course, the ideal result, but even if dismissal is not possible, it is still better to force the opponent to proceed on “cleaned up” and comprehensible pleadings without irrelevant statements or unsupportable claims.

                The Federal Rules of Civil Procedure specify requirements for the form and content of pleadings and motions, as well as mechanisms to force opposing counsel to adhere to those specifications or suffer penalties for failing to do so. Most states have some version of these procedural tools, and many have adopted rules close or identical to the Federal Rules.

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    Topics: civil procedure, Lee Dunham, drafting pleadings, Federal Rules of Civil Procedure, incompetence

    CIVIL PROCEDURE: What Happens to a Derivative Action When the Company Settles a Parallel Lawsuit?

    Posted by Charlene J. Hicks on Mon, Feb 22, 2021 @ 09:02 AM

    The Lawletter Vol 46 No 2

    Charlene Hicks—Senior Attorney, National Legal Research Group

                Corporate shareholders, individual members of a limited liability company, or residents of a homeowners' association often file derivative complaints on behalf of the entity to assert rights that the entity itself has failed to raise against third parties. Sometimes these derivative actions prompt the entity to file its own lawsuit against the same third parties, resulting in parallel proceedings.

                In Star v. TI Oldfield Development, LLC, 962 F.3d 117, 131 (4th Cir. 2020), the Fourth Circuit considered for the first time the issue of "whether a plaintiff's derivative action on behalf of an entity is rendered moot by the entity's settlement of the same or similar claims in another action." As a matter of first impression, the court held that it may.

                The evidence showed that the Board of Directors of Oldfield, a residential community in South Carolina, filed lawsuits related to Oldfield's development. Rob Star, an Oldfield resident, later filed a derivative action on Oldfield's behalf, alleging similar claims against the same defendants. After the Board settled the lawsuits that it brought, the defendants moved to dismiss Star's derivative action on the ground that the settlements rendered the derivative lawsuit moot, and, therefore, the court lacked jurisdiction. In opposition, Star alleged that the settlement agreement was invalid due to a conflict of interest by certain board members and that the derivative action alleged claims not included in the Board's lawsuits.

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    Topics: civil procedure, Charlene J. Hicks, derivative action, parallel lawsuit, settlement of similar claim, release provision

    TAXATION: Taxation of Early Withdrawal from Retirement Account; COVID Exception

    Posted by D. Bradley Pettit on Thu, Feb 18, 2021 @ 11:02 AM

    The Lawletter Vol 46 No 2

    Brad Pettit—Senior Attorney, National Legal Research Group

                A recent decision by the U.S. Tax Court serves as a reminder that if an individual elects to take funds from his or her tax-favored retirement account before he or she attains the age of 59½, the distribution from the account to him or her is not only subject to federal income tax, as are all distributions from retirement accounts, but is also subject to the 10% additional tax that is imposed upon early withdrawals from retirement accounts, such as individual retirement accounts ("IRAs"). In Lashua v. Commissioner, T.C. Memo. 2020-151, 2020 WL 6559172 (Nov. 9, 2020), the Tax Court reminded us that if we decide to withdraw funds from an otherwise tax-deferred retirement account before we reach the age of 59½, we should be prepared, under 26 U.S.C. § 61(a), to report the distribution as "gross income" on our individual or joint federal income tax return and, pursuant to 26 U.S.C. § 72(t)(1), to pay an "additional tax" equal to 10% of the funds that were withdrawn.

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    Topics: D. Bradley Pettit, early distribution of retirement funds, exceptions to additional 10% tax, COVID exception, qualified retirement account

    ADMINISTRATIVE/IMMIGRATION LAW: Chevron Deference Does Not Always Result in Support for the Government's Position

    Posted by Suzanne L. Bailey on Thu, Feb 18, 2021 @ 10:02 AM

    The Lawletter Vol 46 No 2

    Suzanne Bailey—Senior Attorney, National Legal Research Group

                It is well-established law that when a federal court reviews a federal agency's construction of a statute it administers, the court will look to whether Congress has addressed the precise question at issue. If the court determines that Congress has not directly addressed the issue, rather than imposing its own construction of the statute, the court will defer to the administrative agency's permissible construction of the statute. This standard of review is called Chevron deference, after the U.S. Supreme Court decision that articulated it. See Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 842 (1984). While application of Chevron deference frequently results in a decision upholding the agency's interpretation of its own statute, a recent decision from the Fourth Circuit Court of Appeals demonstrates that when the agency's interpretation is unreasonable, its interpretation will not prevail.

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    Topics: Suzanne Bailey, Chevron deference, Amaya v. Rosen, administrative law, unreasonable statutory construction

    CIVIL PROCEDURE: COVID-19 Venue Issues and Relevant Practical Problems

    Posted by Anne B. Hemenway on Thu, Feb 18, 2021 @ 09:02 AM

    The Lawletter Vol 46 No 2         

    Anne B. Hemenway—Senior Attorney, National Legal Research Group

                The COVID-19 pandemic has caused many state courts around the country to either close down during parts of 2020 and 2021 or dramatically curtail operations. In many jurisdictions, jury trials have been canceled or postponed for months. The pandemic has resulted in a plethora of federal court cases regarding requests by federal inmates to be released from federal custody and other court-related issues. See Fern L. Kletter, COVID-19 Related Litigation: Effect of Pandemic on Release from Federal Custody, 54 A.L.R. Fed. 3d art. 1 (2020 & Westlaw updated weekly).

                In a case of first impression in the Commonwealth of Virginia, Clarke v. Medical Facilities of America, Inc. , No. CL20-4379, 2020 Va. Cir. LEXIS 493 (Va. Cir. Ct. City of Norfolk Dec. 30, 2020), the court reviewed whether pandemic-related issues were material to a venue dispute. In that case, defendants in a wrongful death action sought to transfer venue from the circuit court in the City of Norfolk, one of the largest cities in Virginia, to a small rural circuit court closer to the rehabilitation center where the plaintiff decedent had been treated.

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    Topics: Anne B. Hemenway, COVID-19, court venue issues, too speculative, pandemic's disparate impact, relevant practical problems

    ESTATES: Multiple Wills—Reconciliation—Choice of Personal Representative

    Posted by James P. Witt on Tue, Feb 2, 2021 @ 11:02 AM

    The Lawletter Vol 46 No 1

    Jim Witt—Senior Attorney, National Legal Research Group

                Once in a while, the estate planning steps taken by a decedent make you wonder if he or she was intentionally leaving a mess. When Aretha Franklin, the Queen of Soul, died as a result of pancreatic cancer at age 76 on August 16, 2018, no will was filed. Her family believed that she had died intestate. If that had been the case, her net estate would have simply been divided under Michigan law into four equal shares, one for each of her sons, Clarence, Edward, Ted, and Kecalf. In May 2019, however, the family discovered three wills written by Franklin, two from 2010 were found in a locked cabinet, and one from 2014 was found in a spiral notebook left under a couch cushion. The wills seemed fairly evenhanded as among the four sons, but there were questions raised as to the documents' validity by a number of contradictory provisions and the problem with deciphering some of the writing, not to mention numerous underlinings, strikeouts, and marginal notes; much of the writing seemed to be in a stream of consciousness mode.

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    Topics: James P. Witt, estate planning, multiple wills, reconciliation, personal representative

    EMPLOYMENT: Gay and Transgender Employees Are Protected by Federal Antidiscrimination Statute, Supreme Court Holds

    Posted by Nadine Roddy on Tue, Feb 2, 2021 @ 11:02 AM

    The Lawletter Vol 46 No 1

    Nadine Roddy—Senior Attorney, National Legal Research Group

                An employer that discharges an individual for being homosexual or transgender violates Title VII of the Civil Rights Act of 1964, the Supreme Court held 6-3 in one of the last decisions of its October 2019 term. Bostock v. Clayton County, Georgia, 140 S. Ct. 1731 (2020). Title VII contains the well-known prohibition of discrimination in employment against an individual “because of” the individual's “race, color, religion, sex, or national origin.” 42 U.S.C. § 2000e-2(a)(1). Writing for the majority, Justice Gorsuch explained that an employer who fires an individual for being homosexual or transgender fires that person for traits or actions it would not have questioned in members of a different sex. Thus, sex plays a “necessary and undisguisable role” in such decisions—precisely what Title VII forbids.

                Three cases were consolidated for this appeal. Each one started with an employer discharging a long-term employee soon after the employee revealed that he was homosexual or gender-transitioning—and allegedly for no other reason.

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    Topics: employment law, Title VII, sexual orientation, Nadine Roddy, gender status

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