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Homeless Sites in Utah

Monday, 17 April 2017 by Erin McAllister, Paralegal

Since 2014, community leaders, service providers, and elected officials have been meeting regularly to develop a new model and find lasting solutions to Utah's homelessness and housing crisis. On March 25, 2016, Governor Gary Herbert signed into law HB436 (sponsored by Rep. Francis Gibson), providing $9.25 million in state funding during Fiscal Year 2016. HB 436 represents the first appropriation of the State’s commitment to fund $27 million over a three-year period. This initial funding, supplemented by private donations, as well as funding from Salt Lake City and Salt Lake County, will be used to support homeless programs and services as well as begin initial plans for resource center sites in Salt Lake City. Workshops were initiated to give residents opportunities to hear about the site selection process, learn about the homeless population, and provide feedback on how the new shelters — which city leaders have deemed homeless "resource centers" — should be incorporated into the community. The goals of the new shelters/resource centers are to reform statewide efforts to house, shelter and service people experiencing homelessness at scattered sites and to break up the population at the Road Home. The aim is to serve families, single adults, children, and other specific populations experiencing homelessness in a more strategic way. The Road Home shelter on Rio Grande will be closed after the four new resource centers are completed. As soon as the four facilities are up and operating, the building that is the Road Home facility will be transferred to the Salt Lake City’s Redevelopment Agency and will no longer be used as a shelter space. As part of this effort, Salt Lake City formed a Homeless Services Site Evaluation Commission (HSSEC) with the task of recommending the best configuration and location for shelter and emergency homeless services. The recommended “scattered site model”—which calls for separate sites for identified sub-populations—was adopted by the Site Selection Evaluation Commission, with public input, in the fall of 2014. Adoption of the new model for providing crisis services to the homeless community marked the end of the first phase of the Commission’s work. Authorities stress that they are not replacing one shelter with four. They are replacing one with an entirely new approach. New city and county homeless services programs, including affordable housing initiatives, rapid rehousing, and Pay for Success programs will be able to absorb and divert those who don’t occupy bed space in the four new resource centers. Communities have become increasingly hostile to relocating homeless shelters in Salt Lake City and surrounding communities. Public meetings on where shelters should be located have been met with boos and jeers. In Draper, a loud chorus of boos met public officials who considered that community for a site. The leaders of all of Utah's major religions have issued an open letter calling for civility and compassion on issues surrounding homelessness. The letter is signed by the leaders of The Church of Jesus Christ of Latter-day Saints, the Catholic Diocese of Salt Lake City, the Episcopal Diocese of Utah, Salt Lake Calvary Baptist Church, the Greek Orthodox Church, the Islamic Society of Greater Salt Lake, and Congregation Kol Ami. “The depth and strength of a community’s character can be measured by how it treats its most vulnerable citizens. As a group representing many faiths, we implore all to seek a deeper understanding of the many paths that lead to homelessness and to join our common efforts to assist our homeless brothers and sisters in meeting their needs for housing and other services that will help them achieve economic independence and a life of dignity.” This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

New York's Free Tuition

Friday, 14 April 2017 by Staff, Spaulding Law

The State of New York has just announced that starting this fall, undergraduate students attending a State University of New York or a City University of New York may be eligible for a scholarship that will reduce their fees to nothing. This scholarship (The Excelsior Scholarship) will be offered to students if their families earn no more than $100,000 annually. This cap will increase to $110,000 in 2018 and to $125,000 in 2019. Students must also take 30 credits a year to be eligible. This doesn’t necessarily mean 15 credits each semester, a student could take fewer credits one semester and increase their credits in another. Students may also be able pause and restart their participation in the program if they are facing hardship. The scholarship is not necessarily intended to be free money. Students receiving the scholarship are expected to contribute to the New York economy. They will be required to live and work in New York for the same number of years for which they received funding. If they choose to leave, the money will be considered a student loan and will have to be repaid. In a statement explaining why he introduced the bill, Governor Cuomo said, "Today, college is what high school was -- it should always be an option even if you can't afford it." However, with an estimated 200,000 students eligible for the fully implemented program, one has to wonder about the cost. Many colleges are expecting to have more students due to the scholarship. The Governor’s office has estimated that the scholarship will cost $163 million in the first year, but there are questions as to how accurate that number really is. This estimation takes into account other financial aid received by these students. If the number of students increases or the amount financial aid received decreases, the costs of this scholarship could grow very quickly. One of the criticisms of the bill was that initially it didn’t provide assistance for students attending private schools. The final budget now includes an additional $19 million in financial aid for students attending private schools in the same income bracket. However, participating colleges must match the funding provided by the state and agree not to raise tuition costs for that student during their enrollment. These students are eligible for a maximum award of $3,000 from the state which will likely still leave them with some tuition costs, but will greatly reduce this burden as they work toward their degree. With other states considering similar bills, it will be interesting to see what the cost will be, how it changes enrollment numbers, and how it affects the job market. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Syria Strike

Monday, 10 April 2017 by Staff, Spaulding Law

At 3:45 a.m. on Friday morning, the U.S. launched 59 Tomahawk missiles at the Shayrat air base in Syria. This strike was ordered in response to a chemical attack that took place on Tuesday and may have killed as many as 100 people, many of them children. It is believed that the airplane that disbursed the chemicals took off from this air base. The U.S. strike was ordered by President Trump without formal congressional approval. The question is, does he need formal congressional approval? I, like many others, learned in high school civics classes that only Congress has the power to declare war. How then can a President order a missile strike of this magnitude without Congressional approval? The answer is in the War Powers Resolution of 1973 (sometimes referred to as the War Powers Act). This resolution is a federal law that is intended to check the President’s power to commit to armed conflict, but it also gives the President of the United States the flexibility to respond to attacks or other emergencies. However, this is not a blank check to declare war, the President must notify Congress before committing armed forces to military action and may only send armed forces into combat for up to 90 days without congressional authorization for use of military force. The Washington AP noted that while Trump didn’t get formal congressional approval, he did brief more than two dozen members of Congress (from both parties) before the strike. Though many have agreed, to differing extents, that the strike was the right thing to do, members of Congress are requesting more details on the President’s plan moving forward. There seems to be recognition that an act like this will likely not be a one-time thing and Congress wants its opportunity to debate what the actions of the U.S. should be in the future. Representative Justin Amash, R-Michigan, shared his thoughts via Twitter saying, “Framers of Constitution divided war powers to prevent abuse. Congress to declare war; president to conduct war and repel sudden attacks.” It’s not clear what the result of the air strike will be. Countries such as Great Britain, France, Italy, and Israel supported the strike as “an appropriate response”. While supporters of Assad such as Iran and Russia condemned the strike claiming it was aggressive and launched under a “far-fetched pretext”. The conflict in Syria has existed for 6 years and is likely not close to being resolved. A military strike like the one launched on Friday suggests more involvement from the U.S. in the future. It’s unclear what involvement other countries may have, and it will be interesting to see what action Congress is willing to approve. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

The Nuclear Option

Monday, 10 April 2017 by Erin McAllister, Paralegal

James Madison wrote in the federalist papers that the Senate was "the great anchor of the Government," whose slower processes and higher thresholds for action would guard against the "fickleness and passion" of public opinion. That may not be true since facing significant Democratic opposition, Republicans enacted the "nuclear option" to clear the way to confirm Neil Gorsuch as President Donald Trump's nominee to the Supreme Court. The "nuclear option" is a last-resort effort for the majority party in the Senate to overcome obstruction by the minority. It involved changing the rules of the Senate so that a nominee like Gorsuch can be confirmed with a simple majority of 51 votes. Under the previous rules, 60 votes were needed to foil any attempt by the minority party to block a vote by use of the filibuster. While senators are no longer required to give actual speeches to mount a filibuster, it has remained a powerful tool that allows the minority to stall actions in the Senate until the majority can find 60 votes to break a logjam. The change to a simple majority vote may not sound very dramatic, but in a place like the Senate, which historically has operated on tradition and bipartisanship, it's a big deal befitting its doomsday name. Former GOP Senate Majority leader Trent Lott coined the term because both parties saw it as an unthinkable final recourse, just like nuclear war. During a standoff over George W. Bush nominees in 2003, Republicans discussed invoking the parliamentary move by using the codeword "The Hulk" since it, like the superhero alter ego, cannot be controlled once it is unleashed. Others, who want to give it a positive spin, call changing the rules "The Constitutional Option." The history of the constitutional option can be traced to a 1917 opinion by Senator Thomas J. Walsh, who contended that the U.S. Constitution provided the basis by which a newly commenced Senate could disregard procedural rules established by previous Senates, and had the right to choose its own procedural rules based on a simple majority vote. The constitutional option was given further support in 1957 by an advisory opinion written by then-Vice President (and thus President of the Senate) Richard Nixon. In his opinion, Nixon stated that the Constitution grants the presiding officer of the Senate the authority to override Senate rules by making a ruling that is then upheld by a majority vote. The maneuver was brought to prominence in 2005 when Majority Leader Bill Frist (R TN) threatened its use to end Democratic-led filibusters of judicial nominees submitted by President George W. Bush. In response to this threat, Democrats threatened to shut down the Senate and prevent consideration of all routine and legislative Senate business. The ultimate confrontation was prevented by the Gang of 14, a group of seven Democratic and seven Republican Senators, all of whom agreed to oppose the nuclear option and oppose filibusters of judicial nominees, except in extraordinary circumstances. The nuclear option was raised again following the congressional elections of 2012, this time with Senate Democrats in the majority (but short of a supermajority). The Democrats had been the majority party in the Senate since 2007 but only briefly did they have the 60 votes necessary to halt a filibuster. The Democrats would "likely" use the nuclear option in January 2013 to effect filibuster reform, but the two parties managed to negotiate two packages of amendments to the Rules concerning filibusters that passed on January 24, 2013, by votes of 78 to 16 and 86 to 9, thus avoiding the need for the nuclear option. In July 2013, the Senate Democratic majority came within hours of using the nuclear option to win confirmation of seven of President Obama's long-delayed executive branch appointments. The ability of the minority party to filibuster appointments was preserved by a last-minute deal in which the White House withdrew two of the nominations in exchange for the other five being brought to the floor for a vote, where they were confirmed. But no one pushed the button until in 2013, when then-Majority Leader Harry Reid invoked the nuclear option to lower the 60-vote threshold to 51 for approval of Executive Branch appointees (such as Cabinet secretaries) and federal judges below the Supreme Court (such as for U.S. Courts of Appeal). Reid justified the move by citing unprecedented obstruction from Senate Republicans, but members of both parties lamented the precedent it set. Going nuclear means that future presidents of either party will have a much easier time getting their Supreme Court nominees confirmed, which could change whom they decide to appoint. Instead of choosing a more moderate judge who could win support from both parties, they could pick a more ideological jurist capable of winning only on a party-line vote, since the threshold will move from 60 to 51 votes. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Civility in the Public Square

Thursday, 6 April 2017 by Erin McAllister, Paralegal

The heart of American democracy is the “public square”. It is both a symbol of our commitment to First Amendment freedoms of speech, assembly, press, and religion and a collection of real places where debates, political expression and protests take place. In settings as diverse as town halls, barber shops, street corners, colleges, and funeral services for soldiers, Americans come together to listen, discuss, debate and protest. The public square becomes loud and unruly. Groups with opposing views try to shout down one another. Scuffles, violence and arrests sometimes occur. Special interests choose locales to gather and march that are designed to offend the targets of their protest. The signs, language and symbols of the public square are often offensive, nasty, and uncivil. Historians are quick to point out that the lack of civility in the public square is not new. What is changing is that any form of civility is being brushed aside by the desire of groups to force their views in the public square at the detriment of others. The public square must and should be open to all individuals or groups and all views. When ideas or views are diminished by political correctness and shaming, as is popular on social media, democracy is diminished and the public square is not inclusive. The U.S. Supreme Court has generally protected political speech and assembly in many different forms and settings, including the right of neo-nazis to march down the streets of Skokie, Illinois, a community heavily populated with Holocaust survivors. More recently, the Court upheld the free expression of rights of a church to picket at a funeral even though the expression was considered offensive and outrageous. The University of Colorado's Conflict Research Consortium, has been developing an approach which is called "constructive confrontation." This approach combines an understanding of conflict processes, dispute resolution, and advocacy strategies to help disputants better advance their interests. Their approach tries to separate people from the problem, and focus on using available technical facts. They want to limit interpersonal misunderstandings, escalation and use fair processes. They value the legitimate uses of legal, political and other types of power in the hopes of separating win/win from win/lose issues. Civility is about more than just politeness, although politeness seems to be a necessary first step. It is about disagreeing without disrespect, and seeking common ground as a starting point for dialogue about differences. Civility is the hard work of staying present even with those with whom we have deep-rooted and fierce disagreements. It is a necessary prerequisite for civic action. Civility should be used to make sure that everyone’s voice is heard, and nobody is ignored. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Gorsuch Confirmation Hearings

Tuesday, 4 April 2017 by Staff, Spaulding Law

The Senate hearings for US Supreme Court nominee Neil Gorsuch began March 20th, and as expected there was strong opposition from the Democratic party. This opposition is for multiple reasons: payback for the refusal by the Republican controlled Senate to hold a hearing for Merrick Garland who was nominated by President Obama, differences in philosophy, and an attempt to activate their base. Supreme Court Justice Antonin Scalia passed away on February 13, 2016 leaving a vacancy on the Supreme Court. Then president, Barack Obama nominated Merrick Garland to fill this vacancy on March 16, 2016. The Senate was controlled by Republicans at the time. As it was the last year of President Obama’s term and with considerable concern that replacing the very conservative Scalia with a more liberal justice would cause a shift in the ideological balance of the court, the Senate refused to hold any hearings for Supreme Court nominees. This caused frustration and anger amongst Democrats as there was ample time to hold hearings before the election. This frustration was felt during Gorsuch’s hearing through questions specifically referring to the fairness of the treatment of Mr. Garland. Nominee Gorsuch is similar to Justice Scalia in that both are considered to be textualists. The idea behind this philosophy is that you are bound by the language in the law and, to some extent, the original intention of the law. This philosophy is often thought to be narrow and to favor conservative ideals. Many Democrats favor a more liberal philosophy referred to as judicial activism. Judicial activism refers to an interpretation of the law in the current atmosphere and can take into consideration political ramifications of decisions. Gorsuch through his hearings repeatedly refused to give his thoughts on current political issues reaffirming a belief that as a judge he must remain politically neutral. This affirmation was interpreted as insincere by those who oppose him and labeled an attempt to evade difficult questions and avoid transparency. The Democratic party’s power is currently limited at the federal level. They do not have control of either house of Congress, the presidency, and the ideology of the Supreme Court is fairly balanced. Their first real opportunity to change the balance of power comes in the 2018 midterm elections. If there is enough dissatisfaction with the status quo, the Democrats stand a fair chance at regaining control of either the House, Senate, or both. One way to create dissatisfaction is to make it difficult for the other side to accomplish their goals. Democrats may use a filibuster against Gorsuch’s to achieve this. The Republican party still has a “nuclear option” to change the rules of a confirmation to a simple majority vote. However, that may cause the dissatisfaction Democrats are looking for and could have undesirable implications when the opposing party regains power. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Reasonable Doubt

Tuesday, 4 April 2017 by Staff, Spaulding Law

Last month concluded the end of a four-year process in what many have deemed to be the biggest corruption scandal in Utah. John Swallow was acquitted of eight felonies and one misdemeanor following a fifteen-day trial and investigations that began in January of 2013. The basis for this trial were the alleged inappropriate actions and connections of Mark Shurtleff, Tim Lawson, and John Swallow with two convicted felons, Marc Sessions Jenson and Jeremy Johnson. Tim Lawson died before reaching trial and Mark Shurtleff’s case was dismissed without prejudice. However, John Swallow’s case proceeded after Sim Gill (Salt Lake County District Attorney) asserted it was different from the other two. Ultimately the prosecution’s case rested on the testimony of three individuals, Marc Sessions Jenson, Jeremy Johnson, and Jon Isakson. Marc Sessions Jenson testified that the three men had extorted money from him and thrown him in jail unjustly. His testimony primarily focused on Tim Lawson’s requests for money and claims that these payments would result in favors from current Attorney General Mark Shurtleff and his supposed successor John Swallow. Jenson’s credibility was brought into question by the testimony of the other witnesses. For example, he told a story about a secret meeting at Pelican Hill that involved Senate Majority Leader Harry Reid and current Utah House Speaker Greg Hughes where Jenson claimed they met with UTA officials to broker a deal that would benefit them personally. Hughes was vocal in his denial of ever having been a part of such a meeting. While he didn’t testify in the trial, he did offer evidence that he was still in Utah at the time of the supposed meeting. Jenson held firm to his testimony that Hughes was there. There were also audio clips of telephone conversations of him speaking with his wife from jail referencing a desire for revenge. On top of Jenson’s credibility issues, many of the other witnesses called by the prosecution raised questions about Swallow’s connection to Shurtleff and Lawson and even offered explanations as to why Swallow’s actions may not have been inappropriate such as his being a private attorney at the time of the Pelican Hill trips. The prosecution’s case was materially damaged when Jeremy Johnson refused to take the stand. Johnson is currently serving a sentence in federal prison that he plans to appeal. Though the Salt Lake County District Attorney offered Johnson immunity against possible future charges, his attorneys were not convinced that the immunity would cover the federal jurisdiction and two investigations currently underway in different states. Judge Hruby-Mills ultimately agreed with the prosecution and Johnson was ordered to testify. He refused and was found to be in contempt of court and ordered to serve 30 days in the Salt Lake jail. He was brought back to the courtroom several times to see if he had reconsidered, but he remained resolute. With this lack of testimony, the prosecution was eventually forced to drop 4 of the counts against Swallow. The last witness for the prosecution was Jon Isakson (the FBI agent that led the investigation into Shurtleff, Lawson, and Swallow). During cross-examination, he was asked why he didn’t obtain evidence Jenson claimed to have until more than a year after the claim. The defense drew a sharp contrast between the way Jenson (a convicted criminal) was treated versus the way Swallow’s former campaign worker Renae Cowley was treated. She had also been cooperating with investigators, but she had a dozen agents in riot gear search her home. The most explosive part of Isakson’s testimony were his comments regarding the FBI’s declination to prosecute. This decision by the FBI had been barred from this trial and the defense had not been provided evidence concerning this issue. It was decided that the letter declining the prosecution by the FBI would be entered into evidence and some of the testimony given outside the presence of the jury would be presented to the jury. The defense took only one day to call witnesses before resting. For the most part, they didn’t directly refute testimony that had been given, rather they provided more context. For example, two of their witnesses broke down the communications between Shurtleff, Lawson, and Swallow which the prosecution had used as a key part of the evidence for the racketeering charge. These defensive witnesses broke down the data to show when the communication happened, the duration, and even who initiated the contact. This data made it clear that the contact was not consistent over the range of time the data was pulled from. Rather, there was a lot of communication before Swallow joined the Attorney General’s office and almost no contact thereafter. The jury was given instruction and left to sort through the information presented. They deliberated for thirteen hours and came back with four questions. Knowing that the standard for guilty finding was evidence beyond a reasonable doubt, one juror said, "Based on the evidence that was presented, and basically all of the evidence, we weren't firmly convinced, and obviously unanimously we weren't firmly convinced of guilt." They felt that there were gaps in the evidence provided by the prosecution and were not firmly convinced of guilt. In response to the verdict, Sim Gill acknowledged that this case was not black and white but involved various shades of gray. Mr. Gill seemed to imply that the most important thing was that the issues were heard in a public forum. Troy Rawlings, the Davis County District Attorney responsible for dismissing the charges against Shurtleff, said that the outcome of the Swallow case was “predictable to any prosecutor who bothered to assess the evidence with an objective view…” He disagreed with Mr. Gill that the need for transparency to the public was more important than vetting the evidence and understanding the constitutional issues. With such opposing views from two District Attorneys, it is clear that this can be a complicated issue. However, it is reassuring to know that, whatever the standard might be for bringing a case to trial, the standard for conviction is clear: proof beyond a reasonable doubt. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

International Women’s Day

Thursday, 30 March 2017 by Erin McAllister, Paralegal

On February 28, 1909 in New York, 15,000 female garment workers, organized by the Socialist Party of America, marched through New York demanding better working conditions and the right to vote. This event was initially named “International Working Women’s Day. In 1914 it was renamed International Women’s Day (“IWD”) and moved to March 8th. IWD has been a force for good throughout the world. It has brought women together to affect positive changes for women and others. At the end of World War I, Russian women began a strike for “bread and peace” in response to the death of over 2 million Russian soldiers during World War 1. As the strike continued the Czar was forced to abdicate and the provisional government granted women the right to vote. The United Nations began celebrating International Women’s Day in 1975 to help raise awareness of the plight of women and the issues they face: economic inequality, violence, sex trafficking and lack of educational opportunities to name a few. While progress comes slowly, some progress has been made. New Zealand was the first country to give women the right to vote in 1893 and the United States ratified the 19th Amendment on August 18, 1920. More recently, King Abdullah of Saudi Arabia granted women the right to vote in 2011. Now, in 2017, another group, the Women’s March, organized an event to raise awareness of the value of women by encouraging women to participate in A Day Without A Woman on March 8th. This entailed women taking a day off, and refusing to shop or spend money except at woman or minority owned businesses. Their stated focus was on the economic value of women. The event was not without its detractors. Los Angeles Times columnist Meghan Daum described the Women’s March event in “the fine tradition of taking something that worked before and milking it to the point of uselessness or maybe self-parody.” Other authors have noted this new movement excludes women while purporting to speak on behalf of all women. After all, 49.6% of the world’s population is women and those women are going about their lives making a contribution as astronauts, prime ministers, doctors and fire fighters, university presidents, scientists and mothers. Regardless of the criticisms and benefits of the Women’s March Event, it is undisputed that a cultural shift has started but it will take time and energy to enact lasting change. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Hosni Mubarak Walks Free

Thursday, 30 March 2017 by Erin McAllister, Paralegal

Ousted Egyptian president Hosni Mubarak has walked free after six years in jail. Mubarak was cleared for release earlier this month after the country's highest appeals court acquitted him of any involvement in the deaths of nearly 900 Egyptians during the January, 2011 uprising. He had been sentenced to life in 2012 but an appeals court dismissed the charges two years later. Mubarak, 88 left a military hospital in Cairo where he had been held in custody and returned to his home in the upscale Heliopolis district under heavy security. The order to release him was the latest in a series of rulings in recent years that acquitted about two dozen, Mubarak-era cabinet ministers, top police officers and aides charged with graft or in connection with the killing of protesters during the uprising. Some of those acquitted have made a comeback in public life, while others partially paid back fortunes amassed illegally. A former air force chief and vice president, Mubarak became president after fighters who had infiltrated the army shot dead president Anwar Sadat during a military parade in 1981. Mubarak, then vice president, was standing next to Sadat during the attack and was shot in the hand. He was sworn in as president eight days later. Activists say Mubarak's acquittal in the deaths of the protesters confirmed long-held suspicions that he and scores of police who faced the same charges would never be brought to justice. It also made it clear to activists and human rights campaigners how their "revolution" effectively had been reversed by President Abdel-Fattah el-Sisi. The general-turned-politician has restored the status quo in a country ruled by men of military background for most of the last six decades. Despite describing the revolution that ended Mubarak’s rule as a turning point in Egypt’s history, Sisi and his military-backed government are regarded as Mubarak’s political heirs. “I think that Mubarak’s release was something expected as his students are ruling the country,” said Mahienour el Massry, an activist and lawyer who served 15 months in prison under Sisi’s rule. “The same regime, the same corruption, the same brutality.” “Mubarak might be released, but in the eyes of those who believe in the revolution he will always be a criminal killer and the godfather of corruption,” she said. “This might be another round that we have lost, but we will keep on fighting to change the inhuman regime that releases criminals and imprisons innocent people.” Mubarak’s release comes amid an economic crisis following years of political tumult and worsening security. Egyptians complain of empty pockets and inflation exceeds 30%. The economic crisis and the high prices take priority over everything, as does the fear of terrorism. Mubarak’s release marked a new chapter for the former autocrat whose people rose up against him in 2011 and demanded an end to his 30 years in power marked by corruption, economic inequity and reliance on a much-feared security apparatus. It also underscored the failed aspirations of the Arab Spring movement that swept the region. Six years later, mass uprisings in Egypt, Tunisia, Libya, Yemen, Bahrain, and Syria have led to civil war, failed states or a return to heavy-handed rule.

Repealing Obamacare

Thursday, 9 March 2017 by Erin McAllister, Paralegal

House Republicans introduced a bill that would scrap Obamacare's individual mandate, a major pillar of the law, replacing it with refundable tax credits for individuals to purchase health insurance. It would also restructure Medicaid and defund Planned Parenthood. The American Health Care Act (“AHCA”) is not the complete repeal of Obamacare that was promised to voters; hence the new name - Obamacare Lite. The AHCA would repeal the unpopular fines on people who don't carry health insurance. However, it includes an inducement to stay insured in the form of a 30% surcharge on a year’s premium for anyone who drops their coverage or allows it to lapse, then seeks to re-enter the market. The AHCA would have a refundable tax credit to help pay for the insurance and some see this as just another entitlement or government program. Those on the other side of the aisle see it as a way to keep the most marginalized individuals in the program. The AHCA would replace income-based subsidies the current law provides to help millions of Americans pay premiums with age-based tax credits that may not provide the same advantage to people with low incomes. Those payments would phase out for higher-earning people. The AHCA keeps the extremely popular provisions barring insurance companies from discriminating against people because of their preexisting conditions and forces them to continue allowing young adults to stay on their parents’ plans until they’re 26. The AHCA would restructure the country's Medicaid program so that states receive a set amount of money from the federal government every year -- experts warn this change could result in millions of people losing access to insurance they received under Obamacare. Others argue that universal healthcare belongs in the bailiwick of individual states. Since the make-up of residents of individual states varies in size, age, and wealth, to name just a few, it is argued that individual states and their legislatures would be in the best position to create insurance programs that would meet the needs of their constituents. If human behavior under Obamacare is any indication, many people will wait to purchase insurance because they “aren’t sick.” They are young and invincible, the exception to the rule. Taking a chance and remaining uninsured has always been potentially dangerous, but the new healthcare act could make it more appealing to do so because there is no incentive for them to start paying premiums. Having such people remain outside the insurance pool would raise costs for everyone else. When people remain outside the health-care system until they are older and sicker, the practice of medicine changes from preventive to reactive. It becomes more difficult for doctors to keep people healthy and raises costs across the board. At least four Republican senators have voiced concerns with the new healthcare bill. Republicans have just a 52-48 majority in the Senate, so the loss of four votes would doom any legislation. GOP leaders can find a narrow path to passage if enough of their members simultaneously accept legislation that falls short of full repeal while embracing the argument that more consumer choices, lower taxes, and less government involvement is worth the tradeoff of covering fewer people. If the initial reactions are any indication, however, that middle ground may be shaky. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Zion Curtain

Tuesday, 7 March 2017 by Erin McAllister, Paralegal

A bill which includes the tearing down of the so-called "Zion Curtain" — the 7-foot-tall barrier to prevent restaurant patrons, especially children, from seeing alcoholic drinks being mixed — in Utah restaurants could be passed during this legislative session. Utah senators from Layton and Kaysville are working on the completion of an overhaul of Utah’s liquor policy. Their bill focuses on everything from how restaurants operate in terms of verification of age, how they display alcohol, how their servers and operators are trained, what happens in case of a violation, provisions designed to help reduce underage drinking and drunken driving and the infamous Zion Curtain. Utah has some of the most restrictive alcohol laws in the United States. Bar licenses are scarce and are based on the state’s population. Liquor in bottles smaller than 200 milliliters is prohibited. State law limits patrons to no more than 2.5 ounces of liquor at a time. Bars close 1 hour early and heavy beer can’t be sold in bars or restaurants without a special license. The Utah Department of Alcoholic Beverage Control (UDABC) has regulated the sale of alcoholic beverages since 1935, two years after the end of Prohibition. Utah is one of 18 control states, meaning the state has a monopoly over the wholesaling and/or retailing of some or all categories of alcoholic beverages. Zion curtains are partitions unique to Utah restaurants that separate restaurant bartenders preparing alcoholic drinks from the customers who order them. These partitions are often made of frosted glass since they are required to be "solid, translucent, permanent". They were mandated in hopes of combating excessive drinking by keeping alcohol out of sight of restaurant patrons who choose not to consume alcohol. The new changes in the current bill would require all restaurants serving alcohol to either have a Zion curtain or a Zion Moat which is a 15-foot buffer around the bar where children under 21 would be prohibited. Establishments grandfathered in would also be required to choose between the curtain or the moat. For some establishments, this could put them out of business. Utah was founded by Mormon (LDS Church) pioneers in 1847 and until recently, the majority of Utahns were LDS. In recent years, legislation to remove the Zion Curtain repeatedly failed after the LDS Church had opposed any changes in liquor laws, saying current laws have worked well. Legislators proposing the new bill said they have talked numerous times to church leaders, and believe the LDS Church will support their bill. Utah has the lowest underage-drinking rate in the country, fourth lowest drunk-driving rate, second lowest binge-drinking rate. Some argue this is because of our alcohol laws; however, some legislators believe with a push for better education, those statistics will remain low. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Post-Conviction DNA Testing

Monday, 6 March 2017 by Staff, Spaulding Law

Shows like Netflix’s “Making a Murderer” have brought post-conviction DNA testing to the public eye. Steven Avery was exonerated by DNA evidence after serving 18 years for sexual assault and attempted murder. Utah state law 78B-9-301 provides a specific set of standards, after a person is convicted of a crime, to have their DNA retested. They can then be cleared of the charges if the DNA can establish factual innocence. The Utah State Legislature is currently considering a bill (SB0076) that would modify the requirements to obtain this testing and the threshold to overturn a conviction. SB0076 amends the current law to provide that the new DNA evidence only has to establish, by a reasonable probability, that the individual would not have been convicted, or would have received a lesser sentence, rather than requiring that the evidence will establish factual innocence. Under the current law, a convicted individual can send a petition to the court to request DNA testing. The Utah attorney general then has an opportunity to respond to the petition before the court makes a determination. This proposed bill would give the convicted individual an additional opportunity to reply to the Utah attorney general's response before the court makes a determination regarding allowing the testing. The hope with this bill is to make these tests more accessible and help those wrongly convicted. The bill has a fiscal note of $40,000, but it is argued that this cost has the ability to save the state of Utah much more. In the case of Making a Murderer, Steven Avery sued Manitowoc County for $36 million for his wrongful conviction. Ultimately, Steven Avery settled for far less largely due to several unique circumstances. Utah, along with approximately 28 other states have compensation laws for the wrongfully convicted. In Utah, the compensation is currently $40,000 for each year of incarceration with a maximum of 15 years. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Super Lawyers

Wednesday, 1 March 2017 by Staff, Spaulding Law

SPAULDING LAW is proud to announce that its partner Brady Brammer has been selected for inclusion on the 2017 Mountain States Rising Stars Super Lawyers List. This list recognizes no more than 2.5 percent of the lawyers in the state. Mr. Brammer focuses on commercial, real estate, and government entity litigation and was selected for inclusion on this list for the area of Civil Litigation: Defense. He received his J.D. from the J. Reuben Clark Law School at Brigham Young University, where he also received his MPA. Super Lawyers, the Thomson Reuters lawyer rating service, has a mission to bring visibility to attorneys who exhibit excellence in practice. These attorneys are selected to receive the honor after the completion of the region’s patented selection process, comprised of peer nomination, independent research, and peer review.

Utah Jazz and the Legacy Trust

Wednesday, 1 March 2017 by Erin McAllister, Paralegal

Gail Miller, owner of the Larry H. Miller Group of Companies, announced on January 23, 2017, ownership of the Utah Jazz and Vivint Smart Home Arena have been transferred into a Legacy Trust in order to keep the franchise in Utah for generations. Officials believe the move is unprecedented in the history of the NBA — and appears to be a first in the four major North American professional sports (NFL, MLB, NBA and NHL). This unprecedented action will help to ensure the Jazz are always a vital part of Utah and represent the state around the world. “As a family, we have always considered the Utah Jazz a community asset and it has been our privilege to serve as stewards of this team for more than 30 years,” said Miller. “There have been many opportunities to sell and move the franchise, but from the day Larry and I purchased the Jazz our goal was to keep the team in Utah. The Legacy Trust will help to ensure this commitment is kept for generations to come.” What is a legacy trust? A legacy trust, also known as a dynasty trust, is a form of generation skipping trust (GST). This type of trust is normally irrevocable and is intentionally formed to pass assets from the grantor to the grantor’s descendants beyond his/her immediate children (i.e. to grandchildren, great grandchildren, etc.). A GST allows an individual to pay the estate tax once on assets placed in the trust, and the beneficiaries are allowed to use the property while the assets are in the trust and enjoy the income of the trust during their lifetime. Meanwhile, transfer taxes don’t have to be paid on future transfers until the trust ceases to exist. The Utah Jazz Legacy Trust has the potential to last hundreds of years. Dennis Haslam, who worked with the NBA to complete this deal has said, “This has the potential to last hundreds of years, maybe longer.” In common law, there is what is known as a rule against perpetuities; this rule forbids instruments such as trusts “from tying up property for too long a time beyond the lives of people living at the time the instrument was written.” In Utah, the law allows trusts to last 1,000 years. Assuming the Miller legacy trust utilizes Utah’s maximum time frame for trusts, the Jazz could be owned by the trust for 1,000 years. The trust agreement provides for the profits to stay within the trust. The Millers have stated the trust will not provide any "material benefit to the family from the Jazz." It seems the profit stays within the trust. The profit that stays within the trust will be used as retained earnings, for expansion, for player salaries, or other operations. It appears that the trust agreement provides that the earnings of the Jazz are to be reinvested in the team, and since it is a provision of the trust, the trustee has to follow its directions in administering the trust. This legacy trust agreement requires the Millers to be stewards of the team. It is an organized way to keep the Jazz in Utah with the resources it needs in a trust, and to give the Miller family an opportunity to have stewardship over it and to be the ones to take care of it in the future. This direction would be part of the trust agreement to guide future trustees. The Miller family obtained permission from the NBA to transfer ownership to a legacy fund that will be managed by Gail Miller acting as trustee. Following Gail, a six-member board of managers will assume the role of trustee. Those six members will all be Miller family members, to be chosen in a process outlined in the trust's founding documents. Having said all of the above, and from my outside perspective, moving the Utah Jazz to a legacy trust is wonderful. I appreciate the Miller’s innovative thinking and I look forward to having the Jazz in Utah for years and years to come. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Besty DeVos – U.S. Education Secretary

Wednesday, 1 March 2017 by Staff, Spaulding Law

History was made as Besty DeVos was confirmed by the Senate in a 50-50 tie (Republican senators Susan Collins (Maine) and Lisa Murkowski (Alaska) defected from the party line) broken by Vice President and President of the Senate, Mike Pence. This is the first time that a vice president has had to break a tie on a cabinet nomination. Until three years ago, a cabinet nominee had to be able to survive a filibuster which meant that they would need 60 votes for confirmation. Senator Reid led this movement to change the Senate rules to require only a simple majority vote for all nominees except for Supreme Court justices. DeVos attended private schools Holland Christian High School and then Calvin College. A great deal of the opposition to DeVos as a nominee deals with the fact that she has only ever attended private schools. There is concern, specifically from teachers’ unions, that somebody who has never attended a public school or sent her own children to a public school will now assume the responsibility of implementing laws directly affecting the entire nation’s public schools. They also note their concern that she has not spent any time as an educator or in the educational system. DeVos has degrees in business administration and political science and her experience is primarily related to business and politics with a special interest in education. DeVos is viewed as a proponent of charter schools and private education because she has been involved in several organizations that promote school vouchers (state-funded scholarships that help with tuition for private schools). These organizations include: American Federation for Children, Alliance for School Choice, All Children Matter, Children First America, American Education Reform Council, and Great Lakes Education Project. DeVos is not without supporters. There is often new legislation or new standards being presented to public education to deal with perceived deficiencies in the current system (No Child Left Behind, Common Core, etc.) Supporters are arguing that an outsider may be exactly what is needed to shake up the existing system. Her advocates also argue that her support of vouchers is positive because treating education like a market place and opening up options to everyone will improve the quality of the education available. Now that she has been confirmed, we will have to wait to see how her ideas will affect the status quo. Some of the issues she will be expected to tackle are: rising tuition, growing student debt, for-profit colleges, sexual assault, and freedom of speech on college campuses. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Global Trade Accountability Act

Monday, 27 February 2017 by Staff, Spaulding Law

We’ve grown up learning about the three branches of government and we’re all familiar with the phrase “checks and balances”, but in today’s political landscape that concept seems a little murkier. There has been a lot of attention given to the executive orders signed by President Trump, Congress’ approval rating is at an all-time low, and it seems that the Supreme Court has been called upon to settle our most contentious social issues. Now Utah Republican Senator Mike Lee is involved in a collaboration among legislators to resuscitate Congress’ powers in what is being called the Article I Project. One of the focuses for this project is reining in control of the implementation of taxes and tariffs. Article 1 of the US Constitution states that “Congress shall have power to lay and collect taxes, duties, imposts and excises” and “to regulate commerce with foreign nations.” The House specifically is responsible for originating all bills for raising revenue. The purpose for this is to make sure the people are not taxed without representation. However, beginning in 1917, presidents were given the power to impose tariffs in times of war through the Trading with the Enemy Act. Tariffs raise revenue for the nation, but it comes at the cost of taxes paid on imports or exports. This power has since been broadly used and the legislative branch is concerned that there is nothing in place to restrain these actions. Analogous to the proposed Regulations from the Executive in Need of Scrutiny (REINS) Act that would require Congressional approval for any major ($100 million or more) regulation (twice passed in the House and rejected both times by a Democrat controlled Senate), Senator Lee has proposed the Global Trade Accountability Act. This Act would require a joint resolution approved by both the House and the Senate before the President could initiate any “unilateral trade action”. The President would need to submit information regarding an analysis of whether the action is in the national economic interest of the U.S., a list of articles that will be affected by the action, and an analysis noting potential retaliation from trading partners affected by the action. The Act does allow for “national emergency” situations, but the President would have to obtain approval from both houses of Congress after 90 days. The idea is that the extra analysis will ensure accountability and discourage unilateral action by the executive branch. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

The Repeal of Safety Inspections

Monday, 27 February 2017 by Erin McAllister, Paralegal

Utah has had mandatory safety inspections since 1936 and is one of only 16 states still requiring them. That may change as members of the Utah House voted 45-29 to pass HB265 and send it to the Senate. HB 265 would do away with the requirement of a safety inspections before registering your vehicle. HB265 would still require safety inspections for commercial vehicles, but Utah drivers would be able to renew registration on passenger vehicles — new and old — without the currently required safety inspection certificate. We have roughly 1.6 million vehicles that go through the inspection process; 60,000 are rejected for safety concerns. Safety concerns that would cause a vehicle to fail the safety inspection vary from brakes that fail to a burned out light on a license plate. Rep. Lee Perry (a Utah Highway Patrol trooper) said he supported a bill in 2012 that reduced the frequency of inspections and immediately regretted it. The first accident he investigated afterward was a fatality in which a man bought a car in Idaho — which does not require inspections — and its brakes failed in a canyon. Perry has seen problems that killed people that he said could have been prevented by inspections. But the Bill's sponsor, Rep. Dan McCay, said his truck failed an inspection because a license-plate light bulb had burned out. He said studies show fewer than 1 percent of road fatalities come from failed equipment. Introducing the Bill required a study to be completed examining the relationship between mechanical failure and traffic accidents. Under the supervision of a Brigham Young University economics professor, math and economic majors Alex Hoagland and Trevor Wooley conducted the study. “Those states with inspections, versus demographics of those states without inspections required, the proportion of traffic accidents due to car failure is exactly 3 percent on both. There is no difference,” Hoagland said. The study found surrounding states are no different when it comes to accidents resulting from car safety issues. The real problem with traffic safety is bad driving. Rep. McCay believes eliminating safety inspections would allow six Highway Patrol troopers overseeing inspection programs to leave their desks and help enforce laws against speeding, texting, not wearing seat belts or driving while impaired. McCay said studies have shown that a vast majority of fatalities on the road are attributed to driver error, impaired driving, or weather conditions; not because a vehicle didn't pass a safety inspection. To other lawmakers, HB265 was no lighthearted matter. "These safety inspections save lives," Perry said. "I know what I deal with. I know what I see out there." Perry argued that catching the 60,000 serious vehicle problems identified annually by inspections would require "40 troopers stopping 1,500 cars a day," so the change would be a bad trade-off. "It is really a tax," Rep. Derrin Owens, R-Fountain Green, said about inspections. "You have an opportunity to repeal a tax." But Rep. Jim Dunnigan, R-Taylorsville, warned passing the Bill would make Utah roads more dangerous. "There is a certain percent of our population that will drive their car until their brakes fall off and their muffler falls off and their tires fall off. He believes inspections force citizens to keep their cars safe. The U.S. Government Accountability Office, the research arm of Congress, issued a 2014 report saying it can find no definitive evidence that mandatory inspection programs reduce accidents, noting crash rates are about the same in states that have them as in those that do not. But it noted states with those programs do find and correct all sorts of safety problems. For example, the GAO report said Utah in 2015 reported 47,172 failed inspections just for "glass" problems, which it said included "glass that is broken, missing, shattered or jagged," or had "issues with tinting, wipers/washer and mirrors." This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Why Does Bears Ears Matter to Utah?

Wednesday, 22 February 2017 by Staff, Spaulding Law

There is a lot of attention on Utah right now regarding Bears Ears National Monument. The Outdoor Retailer show, that has long been hosted by Utah, has decided to look for a new location at the end of their contract due to Utah’s opposition to the Monument. President Barack Obama exercised the power granted him through the Antiquities Act of 1906, declaring the 1.35 million acres of land called Bears Ears a national monument a few weeks before the end of his term. Utah representatives had proposed a public lands initiative and met with President Obama prior to the order hoping to dissuade him. A 2013 report showed that 64.9% of Utah land is federally owned leaving only Nevada with more federally owned land. The top 12 states where the federal government owns the most land are all in the West. Most of them lost their land as a result of treaties, land settlement laws and patterns, and laws that required them to surrender the land in order to be admitted to the Union. Portions of Utah’s land are currently claimed by the following departments: Bureau of Reclamation, Department of Defense, National Forest, National Historic Site, National Monument, National Park, National Wildlife Refuge, Public Domain, Recreation Area, and Wilderness. The ownership of this land and its resources has an impact on the Utah economy. San Juan County, where Bears Ears is located, is a very rural area. Limiting the use of the land takes away from the potential tax base (such as new mining or energy development) that is used to provide funding for the public schools in the area. It also affects ranchers who have grazed their cattle in that area for generations. Many of these ranchers state that their current profit margins are so slim that additional regulation may make it impossible for them to remain in business. There is a coalition, The Bears Ears Inter-Tribal Coalition, of Native Americans from the Hopi Tribe, Navajo Nation, Ute Mountain Ute Tribe, Pueblo of Zuni, and Ute Indian Tribe that have lobbied for and support the National Monument. The land is a place where tribal leaders and medicine people go to conduct ceremonies, collect herbs, and practice healing rituals. They feel that their traditional medicine is in peril if places such as Bears Ears are not protected. This coalition has proposed that the most appropriate management strategy for this land and its resources would be collaborative management by the tribes and federal agencies. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Immigration Executive Order

Tuesday, 7 February 2017 by Staff, Spaulding Law

The immigration executive order signed by President Donald Trump January 27, 2017 has caused an uproar in the United States. There are strong feelings on both sides of the issue. Those opposed to the order see it as primarily a religious and a refugee issue. There is concern from the opposition that this is essentially a “Muslim ban”. Those in favor of the order see it primarily as a national security issue. There is concern that terrorists will disguise themselves amongst refugees. The idea that this executive order is a “Muslim ban” comes from the language in section 5 subsection b of the order: “Upon the resumption of USRAP admissions, the Secretary of State, in consultation with the Secretary of Homeland Security, is further directed to make changes, to the extent permitted by law, to prioritize refugee claims made by individuals on the basis of religious-based persecution, provided that the religion of the individual is a minority religion in the individual's country of nationality. Where necessary and appropriate, the Secretaries of State and Homeland Security shall recommend legislation to the President that would assist with such prioritization.” The countries that have been suspended are: Iraq, Syria, Sudan, Iran, Somalia, Libya, and Yemen. These countries are all Muslim-majority countries so a Muslim refugee would not qualify for prioritization under this order. This has led some groups to claim there is a preference for Christian refugees and a bias against Muslim refugees. A reason for the order is stated in section 2: “It is the policy of the United States to protect its citizens from foreign nationals who intend to commit terrorist attacks in the United States; and to prevent the admission of foreign nationals who intend to exploit United States immigration laws for malevolent purposes.” Currently, individuals seeking visas to come to the United States must go through a review process. This order asserts that the review processes are in need of review and possible updates. There are 10 sections to the executive order and 7 of the sections specify current programs for entering the United States that may have processes that are inadequate to measure up to the above stated policy of the United States. Those in support of the order point to recent examples of terrorism within the US such as the Orlando nightclub shooting, the Boston Marathon bombing, and the San Bernardino shooting. There is fear that allowing more individuals from the banned region will increase the number of these kinds of incidents. However, opponents to the executive action have been quick to point out that those involved in these incidents were not refugees and may still have been able to gain access to the United States under this order. It is not clear whether this order will remain in place as a federal judge in Seattle suspended the travel ban, and a federal appeals court denied the request to immediately reinstate the ban and has yet to officially rule on the issue. It is possible that the issue will be brought before the United States Supreme Court. If this is the case, the argument will be whether the President has the authority to instate such a ban and if the ban is in line with the laws of the country. It is an interesting, if not an emotionally charged question. Either way, it is unlikely that the American people will reach a consensus on how to resolve this issue anytime soon. The full text of the executive order can be found here: https://www.whitehouse.gov/the-press-office/2017/01/27/executive-order-protecting-nation-foreign-terrorist-entry-united-states This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

The New Supreme Court Nominee – Neil Gorsuch

Tuesday, 7 February 2017 by Erin McAllister, Paralegal

At 49, Neil Gorsuch could become the youngest person to sit on the Supreme Court. His credentials are impressive. He graduated from Columbia with a Bachelor of Arts and Juris Doctorate from Harvard Law School. (He was a classmate of Barack Obama). He also earned a Doctorate of Philosophy in Law from University College, Oxford under Professor John Finnis. For the past ten years he has served as an Appellate Judge on the Tenth Circuit Court in Denver. Gorsuch clerked for Judge David B. Sentelle on the United States Court of Appeals, for the D.C. Circuit, and then for United States Supreme Court Justices Byron White and Anthony Kennedy. He was a Deputy Associate Attorney General at the U.S. Department of Justice. From 1995 to 2005, Gorsuch was in private practice with the law firm of Kellogg, Huber, Hansen, Todd, Evans & Figel. Gorsuch is the recipient of the Edward J. Randolph Award for outstanding service to the Department of Justice, and of the Harry S. Truman Foundation's Stevens Award for outstanding public service in the field of law He is the author of two books. His first book, The Future of Assisted Suicide and Euthanasia, was published by Princeton University Press. He is also one of 12 co-authors of The Law of Judicial Precedent, published by Thomson West. He was born and raised in Denver, is an avid skier, and enjoys fly fishing. For a court dominated by New Yorkers with only one Californian, he brings geographical diversity. He's a gifted writer who goes out of his way to make his opinions accessible to average readers. Gorsuch is a constitutional originalist and textualist, interpreting the Constitution as it was originally written, considering the exact wording of the law over its intent or consequences. Gorsuch has said, “When we judges don our robes, it doesn’t make us any smarter, but it does serve as a reminder of what’s expected of us: Impartiality and independence, collegiality and courage.” Gorsuch also believes there are differences between judges and legislators. While legislators may bring their own desires and moral convictions to the lawmaking process, judges, must instead “apply the law as it is,” leaving their own values and preferences out of the process. In his most notable 10th Circuit case, Gorsuch ruled in favor of the religious rights of Hobby Lobby Stores, which opposed parts of the Affordable Care Act that mandated coverage of contraceptives for employees. The Supreme Court eventually supported his ruling. He similarly backed the Little Sisters of the Poor, a Catholic order, who also protested the contraceptive mandate. Gorsuch has been a strong opponent of “executive overreach,” and critical of the consolidation of federal power and executive orders by then-President Barack Obama. Ironically, that position may win him some support among Democrats and Republicans alike who now fear the scope of President Trump’s executive orders. He favors a limited role for the judiciary, leaving policy-making to the legislative and executive branches. “Often judges judge best when they judge least,” he wrote last year. When judges defer to the executive about the law’s meaning, he wrote, they “are not fulfilling their duty to interpret the law.” In strong terms, Judge Gorsuch called that a “problem for the judiciary” and “a problem for the people whose liberties may now be impaired” by “an avowedly politicized administrative agent seeking to pursue whatever policy whim may rule the day.” That reflects a deep conviction about the role of the judiciary in preserving the rule of law. He has generally favored the state over the federal government, and has criticized liberals for relying too much on the power of the courts rather than enacting laws to achieve their goals. Gorsuch has expressed his support for term limits. “Recognizing that men are not angels, the Framers of the Constitution put in place a number of institutional checks designed to prevent abuse of the enormous powers they had vested in the legislative branch,” he wrote in 1992. He is also critical of the Chevron deference, a principle in which courts generally defer to federal agencies when interpreting ambiguous regulations. Under the Obama administration, many Republicans said that deference gave the executive branch too much power — an argument many Democrats may rally behind now. In a concurring opinion last year, Gorsuch wrote that the Chevron deference allows “executive bureaucracies to swallow huge amounts of core judicial and legislative power and concentrate federal power in a way that seems more than a little difficult to square with the Constitution of the framers’ design.” Some Democrats have already said they would flatly oppose whoever President Trump picks in retaliation for Republicans blocking the nomination of Judge Merrick Garland for almost a year. There may, however, be some common ground in this nominee. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Buy-Sell Agreements

Wednesday, 1 February 2017 by Erin McAllister, Paralegal

In any business with multiple owners, there is a good chance that at some point, one or more of those owners may no longer be affiliated with the company, whether by choice, death, bankruptcy, or divorce. It’s important for business owners to plan for this in advance, so that when one of these situations occur, there is a preexisting agreement that sets out an orderly way to handle the situation. The best way to do this is with a buy-sell agreement. A buy-sell agreement is a contract between business owners that dictates who can buy a departing owner’s share of the business and establishes a fair price for the owner’s stake. The agreement may also provide procedures to resolve disagreements when a majority of the owners but not all of the owners decide to sell the business. Here are some reasons why you don’t want to be in business with other people (even family) without a buy-sell agreement in place:  You should be able to choose your partners. When you made the decision to enter into business with your partners, hopefully you thought extensively about it and did some due diligence on them. It would be unfortunate to have that diligence and thought go to waste because your partner’s stake in the business can be transferred to third-parties for a variety of reasons including: your partner decides to sell, goes bankrupt and is forced to sell, dies, or gets divorced and his spouse ends up with some or all of his shares. In this event, you could have new partners that you never counted on having, and this may threaten your business’s ability to continue on its current path.  If your partner decides he no longer wants to be involved in the business, you have a way of obtaining his stake in the company so that he can’t continue to influence the business after he is no longer involved. Buy-sell agreements often state that if an owner-employee were to become no longer employed by the company, that owner-employee must sell his stake back to the company or the other owners. Also, since buy-sell agreements provide a mechanism for determining a fair price in the departing partner’s stake, he will be unable to extort an unreasonably high sum on his way out.  If you want to leave the business and no longer want to own stock in the company, you have a way of fixing the price in your stake. Again, since a buy-sell agreement sets out a method of determining the price of the stake of the departing owner, you can eliminate potential lawsuits and disputes by agreeing in advance what is fair. This can be of benefit to you if you are the one leaving the company. Be careful though; if the valuation method is not well thought out, you could end up being unable to get a fair price on your stake in the company on your way out.  It could reduce your estate tax burden. The valuation method contained in a buy-sell agreement is set not only for purposes of an eventual sale, but also for estate tax valuation purposes. Privately owned businesses are difficult to value. An owner’s idea of a business’s worth at his death may be much lower than the IRS’s. However, if you have a buy-sell agreement in place, as long as such agreement is a bona fide arms-length transaction, you can use the method contained in that agreement as evidence as to how the business should be valued. But if no process for valuing the business has been put into place, the IRS may be free to determine its own value.  It lets the partners set expectations as to the transferability of interests in the company. Even when a partner does not want to leave the company, he still may want to sell part of his stake in the company to partially “cash out” for any number of reasons. Putting in place a buy-sell agreement can give the remaining partners a right of first refusal or other protections to give them more control over ownership changes in the company. In the least, the mere process of writing a buy-sell agreement is beneficial because it gives the partners a chance to discuss and decide these issues at a time when there is often a surplus of good will.  It can prevent minority shareholders from vetoing a sale of the business. If a buy-sell agreement contains a drag along clause, then a majority of owners can force the entire business to be sold. Without this, it is possible that even a 1% owner could hold up an entire deal, possibly to extort the other owners for a greater portion of the sale proceeds.  It can protect minority shareholders from being cheated out of the proceeds of a sale of the business. If a buy-sell agreement contains a tag along clause, then upon the sale of the business, the minority owners will be entitled to the same price per share as the majority owners. This prevents majority shareholders from conspiring with a buyer of the business and extracting a control premium from the buyer to the detriment of the minority shareholders.  The time when someone leaves a company is not the time to be negotiating the fair value of a business. Often partings are awkward and sometimes downright unpleasant. Emotions may run high, precluding a careful and thoughtful discussion of how to resolve disagreements. Instead, you should set the mechanism for calculating the value while partners are likely to act reasonably.  It can protect your family. One of the most likely reasons why you may need to leave your company or transfer your stake is upon your death or disability. At this point, you will not be capable of negotiating on behalf of your family. Your family will need, and deserves to be paid, the fair value for your interest. If there is no buy-sell agreement in place, the surviving owners may be reluctant to pay a fair amount for your stake and are likely to at least negotiate against your family members. A buy-sell agreement provides a pre-agreed method of making sure the work you put into your business takes care of the people you care about most. Buy-sell agreements are a crucial part of business planning for any venture which is owned by multiple parties. They can be used for corporations, limited liability companies, and partnerships. Drafting one should not be put off because, if you don’t put one in place at the outset, you are unlikely to do so until issues arise. You should consult an attorney with experience in business and corporate matters for more information. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Landlord Basics

Wednesday, 1 February 2017 by Staff, Spaulding Law

Well managed rental properties with consistent tenants can provide steady income (if the rent is higher than your expenses). Property, when purchased at a reasonable price, has a tendency to appreciate. And owning property can also be a low risk investment because, although its value may fluctuate with the market, the property will not disappear the way your money can in the stock market. Notwithstanding these advantages, if you choose to rent property you will want to make sure that your property and rights are properly protected. Below are a few things you should keep in mind: Written Rental Agreements Know the law of the state you are in and the rights you are guaranteed as the landlord as well as the rights guaranteed to the tenant. Most states will have provisions that act as a default if no written agreement is in place and may not favor the landlord. A landlord can be assured of having the best terms possible if they are aware of which rights can be changed by a written agreement. For example, this is a great place to spell out the terms of the security deposit, when and how much will be returned, and under what conditions. Background Checks A landlord should be aware of who their tenants will be. It is important to note that there are some things that cannot factor into a landlord’s decision to rent such as: race, color, religion, sex, national origin, handicap, family status, or source of income. A landlord would be wise to confirm a potential tenant’s employment, credit history, and if possible, their previous landlord’s experience. Supervise Property Managers Property managers can greatly reduce the amount of work a property owner has to put into renting their property. They can take care of finding tenants, collecting rent, and making repairs on your property. However, a property owner can be responsible for the actions of their property managers. The property owner may be financially responsible if there is a violation of a building or health code as well as if the property manager engages in illegal practices such as discrimination. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Non-Circumvention Agreement

Thursday, 26 January 2017 by Erin McAllister, Paralegal

A non-circumvention agreement is used to protect the business contacts and relationships under a business deal. It generally provides that each party shall use the other party’s information only for the purpose of pursuing a business relationship between the parties. A non-circumvention agreement is a legal document that can protect your business from being undercut or taken advantage of during special contractual agreements with other businesses. This type of agreement also often includes non-disclosure, non-solicitation and confidentiality clauses which further protect your company’s efforts. The non-circumvention agreement’s purpose is to ensure that the identity of the introducing party’s contacts and resources remain confidential, and that the other party will not circumvent the introducing party to engage with their contacts. If this agreement is violated, the violating parties may be responsible to pay steep penalty fees in damages that the introducing party would have received had the contract not been violated. You should consider a non-circumvention agreement if you are contracting with another business in a similar field; and your list of resources and business contacts is both valuable and secret. A non-circumvention agreement should include provisions that require amendments to the agreement to be in writing and signed by both parties, specify the state laws that will govern and interpret disputes between the parties regarding the matters covered by the agreement, and prohibit the parties from assigning their obligations under the agreement to third parties. Generally, the state laws that govern the agreement should be the state of the disclosing party. An example of a situation where a non-circumvention agreement would be used follows. You own a special boutique that designs high-quality blouses for women. You, party A, design high-quality blouses to be distributed to department stores nationwide. Party B, is a high-quality blouse manufacturer. You have contacted party B to manufacture these blouses to your design specifications and then to ship them to the department stores (party C). The non-circumvention agreement may prevent party B from creating these specialty blouses for a lower fee arrangement than offered by party A. It also could prevent party B from bypassing party A altogether and going directly to party C with the same products. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Trade Secrets

Monday, 23 January 2017 by Staff, Spaulding Law

Many businesses have their own “secret sauce” that sets them apart from other companies called a trade secret. This could be an actual product or formula, or it could be the processes, methods, and techniques used by the company. Information is likely to be considered a trade secret if it is: • Known only by employees and others involved in the business; • subject to reasonable efforts to maintain the secrecy of the information; • not readily ascertainable by proper means; • difficult for others to duplicate independently; and • it has independent economic value. In an effort to create fair play and protect trade secrets, the Uniform Trade Secrets Act was created. Utah is one of many states that have adopted this legislation. Utah’s specific trade secret law is available at https://le.utah.gov/xcode/Title13/Chapter24/13-24.html. Utah’s law refers to the theft of trade secrets as misappropriation. Misappropriation refers to the acquisition of a trade secret by someone who knows or has reason to know that the trade secret was acquired by improper means or disclosure without consent of the company (express or implied) by a person who 1) used improper means to obtain the information or 2) received the information properly but had a duty to maintain its secrecy. Utah law defines improper means as: theft, bribery, misrepresentation, breach or inducement of a breach of duty to maintain secrecy, or espionage through electronic or other means. Companies threatened or actually harmed by trade secret theft may seek relief through an injunction (a judicial action that restrains a person from starting or continuing an action). The injunction may be terminated when the trade secret has ceased to exist, but the injunction may be continued for an additional reasonable period of time in order to eliminate any commercial advantage that otherwise would be derived from the misappropriation. In exceptional circumstances, an injunction may condition future use upon payment of a reasonable royalty for no longer than the period of time for which use could have been prohibited. On top of an injunction, a victim of trade secret theft may seek damages for misappropriation. This can include actual losses as well as the benefits/profits (or “unjust enrichment”) acquired by the trade secret thief through the misappropriation. If willful and malicious misappropriation exists, some courts can award damages two or even three times the amount of the actual losses plus the unjust enrichment. A business does not have an unlimited amount of time to bring a claim. Time restrictions may vary by state. An action for misappropriation in Utah must be brought within 3 years after the misappropriation is discovered or, by the exercise of reasonable diligence, should have been discovered. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Going Digital? Don't Forget an Invention Assignment Agreement

Thursday, 19 January 2017 by Erin McAllister, Paralegal

In today's modern era of the Internet, small businesses come in all shapes, forms, and types of tangibility. Businesses today can exist solely in the digital sphere, selling digital products that people only use in digital media. But before businesses hire that pricey developer to start developing, an Invention Assignment Agreement (IAA) should be signed. Developing code is not just a science, it is an art. Like photographers, developers and coders are typically the copyright holders and owners of their code. Before your business hires that coder to build the next revolutionary program, make sure you know who owns what from the outset. What is an Invention Assignment Agreement (IAA)? An IAA is an agreement between an employer and employee (or contractor), that provides that all inventions made by an employee/contractor while working for the employer belong to the employer. These agreements are also commonly referred to as an Assignment of Proprietary Rights or a Developer Agreement. In the world of coding, programming, and web building, an IAA is critical in order to prevent problems down the road. The most common example is when a business hires a developer without having them sign an IAA first. After building something great for the company, the developer then leaves. A year later, investors are considering putting money into the company, but find out that the developer, and not the company, owns the rights, or perhaps both have equal rights, to the invention. Investors must take into consideration that the developer, who left the company, could have sold his rights to the competition, or even give it away for free. Clearly, not getting that IAA signed at the outset can create problems down the road. Employers should seek to have all employees sign an IAA upon hire. If employers seek to have employees sign an IAA after employment has commenced or after a product, invention, or program has been produced, then the strength of the IAA can be greatly diminished. All contracts require consideration (usually money), and asking an employee to sign a new contract requires providing consideration. Don't hire developers or other employees without IAA protection. Your business's future could depend on it. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

What Is A Lien

Thursday, 19 January 2017 by Erin McAllister, Paralegal

A lien is an encumbrance on a person's property to secure a debt. Before you can sell your property and give clear title to the buyer, you must remove the lien (usually by repayment of the debt). Liens usually attach to real estate, but they can also attach to personal property. Below are types of liens that could be placed on property by creditors: • Judgment Lien. A creditor who wins a judgment in a court action can attach a lien to real or personal property to pay off the judgment. Because procedures for a judgment lien vary from state to state, it is wise to consult an attorney. • Property Tax Lien. If you have any delinquent property taxes on any real property you own, the county where the real property is located can place a lien on your property. This lien would have to be paid off before your title would be considered clear of any encumbrances should you want to sell. • Tax Lien. If you accumulate back taxes after receiving notices from the IRS, it may place a lien on any or all of your property. If you’re unemployed, self-employed, or sporadically employed and the IRS would have trouble attaching your wages, a tax lien could be used. The IRS may force a sale if the amount you owe is substantial. • Child Support Lien. If you owe a significant amount in child support or alimony, the recipient may put a lien on your real estate. The lien will stay until you pay the support you owe, until you sell or refinance your property, or until the recipient forces a lien sale, whichever happens first. • Mechanic’s Lien. If a contractor works on your property or furnishes construction materials to be used on your property, and you don’t pay for those services, the contractor can record a lien on your property called a mechanic’s lien. In most states, the contractor must record the lien within one to six months of when the contractor wasn’t paid. The contractor then must sue you to enforce the lien within about one year (the range is one month to six years, depending on the state). If the contractor wins the lawsuit, the contractor may be able to force the sale of your property. • Family Law Real Property Lien. In some states, in a marital action a spouse may file a lien against his or her interest in community real estate to secure payment of attorney’s fees in the action. The lien affects only the filing spouse’s interest in the property. • Consensual Lien. Liens a debtor voluntarily consents to, as a result of a loan or other advance of credit. The property purchased secures the buyer’s obligation to pay for the property. o Purchase-Money Security Interest Liens. Here, the creditor extends credit to the debtor specifically for the purchase of the property that secures the debt. Examples include a first mortgage on a home, a car loan, and situations in which the seller finances the purchase of property, such as furniture, through a credit agreement. o Non-Purchase-Money Security Interest Liens. The debtor puts up property he or she already owns as collateral for a loan. The loan proceeds are then used to pay expenses (or perhaps to buy other property). Examples include a second mortgage (or refinancing of a mortgage) on a home, or a loan used to pay operating expenses with previously owned office equipment put up as collateral. Both types of consensual liens are usually non-possessory. This means that the creditor does not take or retain possession of the property; rather, the debtor takes, or retains, possession of the property. However, it's possible for either type of consensual lien to be possessory. In that case, the creditor takes possession of the collateral. A loan from a pawnbroker, for example, usually would create a possessory, non-purchase-money security interest lien in the collateral. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Copyright Laws

Thursday, 19 January 2017 by Staff, Spaulding Law

Copyright is a legal mechanism that provides the creator of a work of art or literature, or a work that conveys information or ideas, the right to control how the work is used. Some examples of work protected by copyright would be novels, plays, poetry, movies, sheet music, photography, choreography, etc. The creator’s rights include: • the right to make copies of a protected work • the right to sell or otherwise distribute copies of a protected work • the right to create adaptations or derivative works • the right to perform a protected work Copyrighted materials may only be used by the author or a person or entity to whom the author has transferred all or part of his or her rights. If someone wrongfully uses the protected material, the copyright owner can sue for damages. Copyright protection only exists for work that is "fixed in a tangible medium of expression", original, and the result of some creative effort on the part of the author. “Fixed in a tangible medium of expression” means that the work must exist in some physical form for at least some period of time, no matter how brief. There is no definitive rule as to how much creativity is enough to qualify. It may be similar to existing works, lacking in quality, ingenuity, or aesthetic merit. As long as the author creates without copying from someone else, the results are protected by copyright. Copyright does not protect the ideas upon which an expression is based. For example, copyright may protect a particular play about a father and son at war with each other, but it cannot protect the underlying idea of family conflict. Allowing authors to monopolize ideas is in opposition of the very purpose of copyright law, which is to encourage the creation of new work. Facts are not protected under copyright law even if the author spends considerable time and effort discovering things that were previously unknown. It doesn’t matter whether the facts are scientific, historical, biographical, or current event news. Any facts that an author discovers in the course of research are free to all as part of the public domain. Copyright protection does not last forever. Below are some guidelines to help you understand when a copyright will expire: • All works published in the United States before 1923 are in the public domain. • Works published after 1977, the copyright lasts for the life of the author plus 70 years. • The work was never published and the author died over 70 years ago, copyright terminated on December 31, 2002. • The work was published after 1922 but before 1978, it is protected for 95 years from the date of publication. • The work was created, but not published, before 1978, the copyright lasts for the life of the author plus 70 years. • A previously unpublished work was published before December 31, 2002 and the author died over 70 years ago, the copyright will last until December 31, 2047. • The work has been specifically commissioned or created in the course of employment ("work for hire") or is published anonymously or under a pseudonym, the copyright lasts between 95 and 120 years, depending on the date the work is published. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Foreclosure

Thursday, 5 January 2017 by Staff, Spaulding Law

Typically when a person purchases a home, they don’t pay the full amount in cash up front. Instead, they get a loan, make a down payment, and the rest is paid incrementally to a lender. This arrangement is created through a legal document that pledges a piece of real property as security for the debt created by a promissory note (an unconditional promise to repay the amount borrowed) called a mortgage (or deed of trust in some states). If a person falls behind in their mortgage payments, they are in danger of foreclosure. Foreclosure is the legal process that allows the lender of a home loan to sell the home to satisfy the debt the borrower owes. Below are some of the basics of the foreclosure process. • Pre-foreclosure Process First a lender needs to know if they are going to use a judicial or non-judicial foreclosure. A judicial foreclosure requires the lender to go through the court system to take back ownership of the property while a non-judicial foreclosure doesn’t have court supervision but does require following a state-specified process. Which process is used will probably be decided by the state where the property resides, as most states use either one or the other. Typically mortgages can only be foreclosed in court, while deeds of trust can be foreclosed without going through the courts. • Judicial Process In a judicial foreclosure, the foreclosing party (plaintiff) starts by filing a lawsuit in state court. The borrower receives a copy of the complaint to foreclose and gets a certain number of days to respond to the lawsuit (for example, 30 days). If the borrower doesn’t respond to the lawsuit, the court will grant a judgment of foreclosure and set a sale date. The foreclosure sale is a public auction where anybody (including the foreclosing party) may bid on the property. The highest bidder becomes the new owner. In Utah, the foreclosing party must publish notice of the foreclosure sale in a local newspaper once a week for three consecutive weeks, with the last publication occurring at least 10 days before the sale, and provide the borrower with a copy of the notice. • Non-judicial Process In a non-judicial foreclosure, the lender must take one or more of the following steps: • Appoint a Trustee qualified to exercise the power of sale (qualifications may vary by state); • Mail the borrower a notice of default that tells them how much time they have to get current in their payments; • Record the notice of default in the local records office; and • Through certified mail (return receipt requested), send the borrower a notice of sale that tells them the date the property will be sold. Each of these notices have time limits and specific content requirements such as a description of the property, the amount due, the amount necessary to reinstate the loan, and information on the person you can contact to discuss the notice. Just like a judicial foreclosure, the property is sold at an auction (on the courthouse steps) where anybody (including the foreclosing party) may bid on the property. • After the Foreclosure Sale The borrower owns the home up until the foreclosure sale and may legally stay there until this time. If the borrower doesn’t leave the home at this point, the purchaser at the foreclosure sale who is the new owner of the home (often the foreclosing party), must give the borrower a notice to quit before initiating an eviction. • Deficiency Judgements In some foreclosure sales, the property does not sell for an amount sufficient to cover the total debt. The difference between the sale price and the amount owed is called a deficiency. For example, if the borrower owes $250,000, but the home only sells for $200,000. There is $50,000 deficiency. The lender may be able to get a judgment against the borrower to pay that deficiency. It is important to be aware of the state laws regarding these judgments. Some states, such as Utah, limit the judgment totals to a fair market value of the home and disregard the higher amount owed. In this instance, if the borrower owes $250,000, the fair market value is $230,000, and it only sells for $215,000, the lender may only receive a judgment of $15,000 instead of $35,000. While these basics give you a good understanding of what happens in a foreclosure sale, each state has very specific requirements. If you are contemplating a foreclosure, it would be wise to seek the advice of legal counsel to make sure you have complied with every requirement. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Guardianship – Part Two

Tuesday, 3 January 2017 by Erin McAllister, Paralegal

A guardian is someone who makes legal decisions for another person, called a ward, who is unable to make those decisions on their own. Since minors are generally protected and cared for by their parents, a minor's parents make any legal decisions that may be necessary for his or her welfare. However, in some cases a child may need a separate individual to attend to their legal rights, because the minor has inherited assets or no longer has a parent qualified to make legal decisions on his or her behalf. In these cases, a guardian can either be chosen voluntarily by the family or appointed by the court. A guardian should be selected with the best interests of the minor in mind. Courts prefer a chosen guardian to have ties to the ward, such as: • A person chosen by the ward • A parent or another relative • A state employee or private person familiar with the ward If the parents are still alive, before a non-parent is chosen as a guardian the parents must be deemed unable or unfit to look after the best interests of the minor. When minors are removed from the care and supervision of their parents, and adoption is either not forthcoming or not a viable option, guardianship is considered a reasonable alternative. Even after a guardian is chosen for a minor, most state statutes allow that at age fourteen (or other reasonable age), the minor may select (or at least voice a preference) concerning who will be selected to serve as guardian. The guardian of a minor looks after the direct physical well-being of the minor and the assets of the minor's estate. A guardian is also necessary to: • Provide a legal residence in order for the ward to attend a public school; • Apply for public assistance benefits for a minor if needed; • Apply for public housing on behalf of a minor where necessary; and • Bring a lawsuit on behalf of the minor. Generally, the guardian provides whatever care would be given to a child by his or her parents. The guardian also receives and maintains any money due the minor for his or her care or support. The guardian is required to maintain, account for, and preserve any excess funds beyond what is necessary to support the minor. The guardian has a duty to look after the minor's personal property and assure the proper education of the ward. The guardian is also required to authorize any necessary medical or other care for the well-being and health of the ward. When a guardianship of a minor is in place because of the age of the ward, the guardianship may be terminated when the minor reaches the age of majority. However, the guardianship may be reinstated by the court after the ward reaches the age of majority, where it can be shown that the ward still requires supervision. Guardianship may be terminated if the ward marries, and is automatically terminated at the death of the ward. In addition, the guardianship may be terminated, and a new guardian appointed, when it can be shown that the guardian did not adequately perform his or her duties to the ward. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Guardianship – Part One

Tuesday, 3 January 2017 by Erin McAllister, Paralegal

A "guardian" is chosen or appointed to make legal decisions for another person who is unable to make those decisions on their own. Guardians are often appointed for a minor, but sometimes a court will establish a guardian for an adult with special needs or an adult child can become an elderly parent’s legal guardian. In some instances, parents whose child comes into a large amount of money may establish guardianship over their child’s estate. The next two blogs will discuss first, the guardianship of an incapacitated person and second, the guardianship of a minor. The types of decisions a guardian can make on behalf of someone (normally called the “ward”) can vary from simply arranging life necessities, like food and clothing, to making big medical and financial decisions. Therefore, the selection of a guardian is a serious decision. A guardian can be appointed by the ward, perhaps in a will or power of attorney, or by someone like a parent, spouse, or other relative with close ties to the ward. In special cases, a state employee familiar with the ward and his or her incapacity will be chosen by the court as a legal guardian. Like many legal procedures, establishing a legal guardianship is a complicated and regulated process. Once you have decided who will be the guardian, you will need to gather certain documents and file multiple forms with the court. Beyond the legal forms, such as a power of attorney, living will, and guardianship papers, it’s a good idea to have any financial documents like bank and investment statements and titles to personal and real property. State guardianship laws can vary, and the paperwork and process may be different depending on where you live. In cases where a person has pre-selected a guardian through a living will or durable power of attorney, those wishes will normally be honored. Courts are tasked with establishing guardianships, and they typically appoint guardians in instances of incapacity or disability. Suppose, for example, that a person ends up in a coma after a car accident. Unless that person has a durable power of attorney and a medical directive already in place before the accident, the court will appoint a guardian to make both financial and non-financial decisions for the comatose person. This is important because investments, real estate, etc. can lose their value over time if left unmanaged. There are also bills to pay. A guardian should make sure that excessive liabilities do not accrue during the period of incapacity. Guardianships for physically or mentally disabled or incapacitated persons have, in recent decades, been understood to facilitate the independence and self-reliance of the ward. Guardianships are limited to allow wards to exercise as much control over their lives as possible while maintaining the most dignity and self-reliance possible. The desires of the ward are given primary consideration. Also, wards are allowed to do as much of their own caregiving as is physically and mentally possible. Guardians are granted those powers necessary to accomplish for the ward what the ward cannot accomplish independently. These powers may include: • Assuring the availability and maintenance of care for the ward. • Making financial decisions for the ward. • Making medical decisions for the ward. • Making sure that educational and medical services are maintained and adequate. • Submitting updates to the court of the ward's condition. These court updates describe the ward's living situation, status of mental and physical health based upon medical examinations and official records, provide a list of services being received by the ward, describe services rendered by the guardian, account for the ward's monetary assets, and any other information necessary to submit to the court in order for it to assess the status of the ward and the guardian's duties. Guardians aren’t expected to micromanage a ward’s life, since they’re not providing caretaking services. Guardians step in when necessary to make decisions and give consent to things that the wards don’t have the capability of on their own. This is the limit of their duties. How is a guardian chosen? A guardian has to be qualified to serve. State qualifications differ, but in general, to be qualified, a guardian must be a legal adult (18 years of age) and cannot have a felony or gross misdemeanor record implicating dishonesty (forgery, bribery, etc.). The guardian must themselves not be incapacitated. The court will choose based on the express wishes of the ward, if the ward is able to express his or her wishes. If the ward is not able to express his or her wishes, then the court will make a determination based on pre-incapacity documents such as a durable power of attorney or a will, and if there’s no durable power of attorney available, then the courts typically prefer to appoint a spouse, parents, adult children, brothers, sisters, or other family members. Establishing a guardianship can be a complicated process with serious legal consequences. An experienced family or estate planning attorney can answer questions you may have and help you with both the guardianship decision and the official procedure. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

How to Build Credit as a Small Business

Tuesday, 3 January 2017 by Erin McAllister, Paralegal

Whether you are just starting your business, or you have been in operation for years, developing a business line of credit could be a critical step in taking your business to the next level. While many business owners finance their businesses using their personal credit, business lines of credit can be vastly larger and superior to those offered to individuals. The big question that many small business owners ask is: How do I establish credit for my business? Below you'll find three steps you need to take to establish business credit. Step 1: Get rid of the Sole Proprietorship Status Many small business owners never bother with making their businesses official business entities. Experienced entrepreneurs know, however, that operating your business as a sole proprietorship is much riskier than operating an incorporated business or an LLC. While many small business owners neglect getting a local or state business license, even more small businesses never bother to incorporate or set up an LLC. However, establishing credit for your business means that you need to set your business up as an independent entity. Each state has different rules about how to do this, but for the most part it involves getting an Employer Identification Number (EIN), filing state paperwork, and paying a fee. Step 2: Start With Credit From Suppliers and Vendors Just like establishing credit as an individual, when you create a new business entity, your business will have no credit history. In order to qualify for substantial lines of credit, you need to establish a good credit history and operating history. To do so, you should consider asking your suppliers and vendors to set up lines of credit. If you have a good history with the vendors, they will likely be willing to work with you. However, you can always offer to temporarily provide them with a form of a security deposit on your line of credit. Step 3: Pay Every Bill on Time, Every Time Paying all bills on time from vendors, suppliers, creditors, service providers, or anyone that does business with your business, is absolutely essential to developing good credit for your business. Making late payments, missing payments, or worse, defaulting, just like for an individual, will cause your business's credit to suffer. Lastly, if you are trying to establish your business's credit, you can monitor your business's credit report monthly or quarterly for inconsistencies, inaccuracies, and negative marks. Oftentimes, if a negative report appears on your credit history, you can contact the creditor to resolve the report, or you can dispute the report with the credit reporting agency. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Short Sales

Tuesday, 3 January 2017 by Staff, Spaulding Law

In 2008 the housing bubble burst and a number of families were being foreclosed on. Many others, struggling in the bad economy, “short sold” their homes. A short sale is the sale of real estate in which the proceeds from selling the property will be less than the debts secured by liens against the property. For a sale like this to close, everyone who is owed money must agree to take less -- or possibly no money at all. This makes short sales complex transactions that take longer than usual and often fall through. A short sale is an alternative to foreclosure and has some real benefits, but not every person who finds themselves upside down on their mortgage will qualify for a short sale. A short sale must be approved by the lender and may be an option if you are: behind on your mortgage payments, facing a long-term hardship, ineligible to refinance or modify your mortgage, owing more on your home than it’s worth, or unable to sell your home at a price that covers what you still owe on your mortgage. The lender will expect the following in order to make a determination on approval: • A hardship letter. The seller must explain why he or she cannot continue making payments. The more desperate the circumstances, the more likely a lender will agree to a short sale. • Proof of income and assets. If the seller has money in the bank, including retirement funds, it is unlikely that the lender will let the debt slide. This package of information must go back at least two years and include income tax and bank statements. It is important that these documents match the information on the original loan application or the deal will be unlikely to close. • Comparative market analysis. This document shows that the price of the property has declined and that the property won't sell for the amount owed anytime soon. This packet of information should include a list of comparable properties on the market and a list of properties that have sold in the past six months or have been on the market in that time frame and are about to close. This information is less formal but often more informative than a property appraisal. The prices should support the seller's contention that the property is worth no more than the short-sale price. • A list of liens. There may be more than one, so determine how many liens are on the property. The good news is that since late 2008, the IRS has been willing to release a federal tax lien. The IRS is not forgiving the back taxes that homeowners owe; it is just no longer requiring that the lien be paid off before the property can be sold. Some of the benefits of a short sale include: • Eliminating or reducing your mortgage debt. • Start repairing your credit sooner than if you went through a foreclosure. Although a short sale and a foreclosure negatively affect a seller's credit score, in a short sale the damage can be minimized if the homeowner can persuade the lender to report the debt to credit bureaus as "paid in full." • May be able to get a Fannie Mae mortgage to purchase a home sooner (in as little as 2 years) than if you went through foreclosure (up to 7 years). The process for a short sale is similar to a normal real estate sales transaction. However, your mortgage company will also be involved in many of the steps and will likely take much longer than a standard transaction. The lender will help: • set the sale price (based on current market value), • collect financial information and negotiate with other lien holders (i.e., your second mortgage company) if applicable, • review acceptable offers, • agree to the terms of the sale once a buyer is in place, and • work with the buyer’s real estate agent and mortgage lender to finalize the sale. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Tenant Rights in Utah

Tuesday, 3 January 2017 by Staff, Spaulding Law

If you are renting a property in Utah, it may feel like your landlord has all of the rights and you must accept what is presented. However, the State of Utah actually has several laws in place to protect tenants that a potential tenant should be aware of when reviewing the rental agreement. The following are a few of the laws that protect tenant rights: • Security Deposits – While Utah state law does not place limits on how much a landlord can charge for a security deposit, it does, however, limit how much time the landlord has to return it (within 30 days after a tenant moves or within 15 days of receiving the tenant’s forwarding address). If the dollar amount is less than $10,000, tenants can take their landlords to small claims court for the return of their deposit. • Eviction – A landlord may not evict a tenant without notice and they may be required to have a valid reason. State laws are specific about when and how a landlord may terminate a tenancy and they require notice and a court order to do so. There are a few different notices that may be given: 1) A landlord may give a tenant an unconditional quit notice that gives the tenant three days to move out before the landlord can file for eviction. An unconditional quit notice may be used in the following cases: holdover (the lease has expired); assigning or subletting without permission; substantial damage to the property; carrying on an unlawful business on the premises; maintaining a nuisance; and/or committing a criminal act on the premises. 2) If the tenant is renting month to month, and the rental agreement does not guarantee more time, the landlord may issue a 15 day notice to vacate for any reason. 3) A 5-day notice may be given if there is no rental agreement and a guest refuses to leave, the lease expires and the landlord decides not to renew, or if a new owner of the property receives a title terminating all rental contracts. • Entry – Utah landlords must provide 24 hours’ notice of entry unless the rental agreement specifies otherwise. A potential tenant should expect the rental agreement to allow access for emergencies, agreed services such as repairs, and to show the unit to potential purchasers or tenants. A rental agreement that gives the landlord the right to access the property without notice for reasons other than emergencies may be a reason to continue the rental search. As a potential tenant, it is very important to know your rights and to read the rental agreement carefully. This will help you determine whether the agreement is reasonable and will likely give you an indication of the relationship you will have with your potential landlord. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Independent Contractor or Employee?

Tuesday, 3 January 2017 by Staff, Spaulding Law

A company must decide if they will hire employees or independent contractors to complete the projects they receive. While most people are familiar with the concept of employees (benefits, salary, pto, etc.), there are some real benefits to hiring independent contractors. • Employers do not need to pay unemployment insurance taxes or other payroll taxes for independent contractors, as they do with employees. Independent contractors are not eligible to file claims for unemployment benefits (Utah Code § 35A-4-204). • Independent contractors are not covered by the Utah Workers' Compensation Act and are not eligible to receive or file workers' compensation claims. This means employers can save money by not obtaining workers' compensation coverage for independent contractors. • Employers must withhold income tax, social security, and Medicare taxes for employees. They are also responsible for paying social security, Medicare, and unemployment taxes on wages. Independent contractors, however, are required to pay their own income tax and self-employment tax and businesses are not required to withhold any taxes. These benefits are very attractive, but not all workers will qualify as independent contractors. In order to meet the regulations for the Utah Employment Security Act, Utah Worker’s Compensation Act, and Utah State Tax Commission, an independent contractor is customarily engaged in an independently established trade, occupation, profession or business of the same nature as the services performed, and the individual providing the services must be free from the employer's control and direction while performing services for the employer (Utah Admin. Code r. 994-204-301(1)). A worker must clearly establish his status as an independent contractor by taking steps that demonstrate independence indicating an informed business decision has been made (Utah Admin. Code r. 994-204-301(1)). They ought to be: • Independent of the employer in all that pertains to the execution of the work. • Not subject to the routine rule or control of the employer. • Engaged only in the performance of a definite job or piece of work. • Subordinate to the employer only in effecting a result according to the employer's design. (Utah Code § 34A-2-103(2)(b)(i).) A worker is considered to be independently established if: • They have an independently established trade, occupation, profession, or business that is created and exists apart from a relationship with a particular employer and does not depend on a relationship with any one employer for its continued existence (meaning they are non-exclusive and regularly do work for other clients). • Separate place of business. • Provide their own tools and equipment. • Can realize a profit or risks a loss from expenses and debts incurred through an independently established business activity. • Advertises their services. • Has a business or professional license. • Maintains business records including tax forms. The following list is indicative of the control and direction an employer would have over an employee and should be avoided if you want to classify a worker as an independent contractor: • Lack of freedom over the manner and means by which the result is accomplished. • Requirement to comply with instructions on how the service is to be performed. • Provision/requirement of training that indicates that the service is to be performed in a specific method or manner. • Requiring work to be performed at a specific pace or ordered sequence. • Requiring that the work be performed on the employer’s premises. • Requirement to perform the work personally with no right of assignment. • Continuous relationship – work is performed regularly or at frequently recurring intervals. • Set hours or specific number of hours to be worked. • Payment by the hour, week, or month points to an employer-employee relationship, provided that this method of payment is not just a convenient way of paying progress billings as part of a fixed price agreed upon as the cost of a job. Control may also exist when the employer determines the method of payment. It is important to know if your worker meets the requirements listed above because there are serious consequences for misclassifying an employee as an independent contractor. Knowingly making a false statement under the Employment Security Act to avoid or reduce the obligation to pay unemployment compensation is a criminal offense. The degree of the offense depends on the total monetary value sought to be obtained by the false statement (Utah Code § 76-8-1301). There are no penalties for improper classification through the Utah State Tax Commission. However, employers who misclassify workers may be liable for additional tax. Intentionally, knowingly or recklessly misclassifying an employee as an independent contractor to avoid the obligation to obtain insurance coverage constitutes workers' compensation insurance fraud. Workers' compensation insurance fraud is punishable by: • Imprisonment of up to one year or a fine up to $2,500, or both, if: o the value of the property, money or other thing of value sought be to obtained is less than $1,000; or o the number of individuals not covered is less than five. • Imprisonment of up to five years or a fine up to $5,000, or both, if: o the value of the property, money or other thing of value sought be to obtained is between $1,000 and $5,000; or o the number of individuals not covered is five or greater, but less than 50. • Imprisonment of between one and 15 years or a fine up to $10,000, or both, if: o the value of the property, money or other thing of value sought be to obtained is $5,000 or greater; or o the numbers of individuals not covered is 50 or greater. (Utah Code §§ 34A-2-110, 76-3-203, 76-3-204 and 76-3-301.) In addition, employers who fail to comply with the Workers' Compensation Act may be liable in a civil action to their employees for: • Damages suffered by reason of personal injuries arising out of or in the course of employment. • Necessary costs. • Reasonable attorneys' fees. (Utah Code § 34A-2-207.) This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Termination in an At-Will State

Tuesday, 3 January 2017 by Staff, Spaulding Law

You always hope when hiring an employee that they will be a perfect fit for your organization. What happens when this is not the case? What if you decide you can no longer afford an employee or they are just not a good fit? If you are in a state like Utah, you have the right to terminate their employment “at-will”. This means that generally an employer can terminate an employee for any reason at any time (an employee can also quit without giving any notice). However, the Utah Labor Commission states that there are some exceptions to this right to terminate at any time for any reason. According to Utah law, an employer may not terminate an employee when it would violate clear and substantial Utah public policy. Examples of terminating an employee in violation of public policy would be termination for: o refusing to file false tax returns o refusing to file false customs documents o refusing to mislead a safety inspector o refusing to notarize a signature when the person who signed is not present o refusing to present a consumer with misleading information o refusing to participate in rebate program that violates federal lending laws It would also be a violation of public policy for an employer to fire an employee for: o serving on a jury o responding to a subpoena o serving in the military An employer should carefully review employment contracts before terminating an employee. If an employee has a contract for a specified time or task there may be an implied or express contractual term that requires dismissal for cause only. A termination of this employee may open an employer up to a claim of breach of employment contract in court. A statute or regulation may restrict the employer’s right to terminate. An example of such a statute or regulation would be the Utah Antidiscrimination Act of 1965. This act prohibits termination for reasons of race, color, religion, sex, age (over 40), national origin, disability, sexual orientation, gender identity, pregnancy, childbirth or pregnancy-related conditions. The law also provides some protection for those who blow the whistle on unlawful practices; those who ask for reasonable accommodation, complain about unlawful discrimination, and/or participate in an investigation regarding discrimination cannot be terminated for these actions alone. Because of these exceptions, it is wise to document the reasons for termination even though an employer may have the right to terminate an employee at-will according to state law. This practice will likely be of assistance at some point should the employer face a claim of wrongful termination. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

'Tis The Season for Estate Planning

Wednesday, 21 December 2016 by Erin McAllister, Paralegal

When your family gathers during the holidays, it is the perfect time to discuss estate planning. Many families are geographically spread out, so when everyone is together in one place for the holidays, having a group meeting to discuss the family's estate plan makes sense. There are two main issues that need to be addressed: advanced directives and the parents' will. Since these issues are hard topics, it is best to set a time before, after, or even on a different day so long as everyone is still in town. To help coordinate, it is usually a good idea to notify everyone, in advance of them making travel or vacation plans, that the discussion or meeting is going to happen on a particular day and time. Advanced Directives An advanced directive is a legal document that advises doctors about certain medical decisions a person wishes to be made if they become unable to make the decisions. Typically, these involve requests to either remove, or not remove, life support, or not to resuscitate, if a person becomes incapacitated, comatose, brain dead, or is suffering from some other condition. Frequently, advanced directives are difficult documents to discuss with family members, especially if a parent is adamant about not being resuscitated if the worst happens. Having the discussion may be difficult, but when everyone is together, there is a greater chance to talk openly and reach an understanding. Will / Estate Plan Another important topic to discuss is the estate plan. While parents will generally leave their estates to their spouses, children and grandchildren, some individuals want to make charitable contributions as well as leave certain items to non-family members. It is important to discuss these matters so that when the time comes, there is no confusion. Also, having the discussion may also enlighten a parent as to what are the important, sentimental items that are specifically wanted by family members. Meeting with an estate planning attorney before having the family meeting is a good idea in order to understand all the items that need to be addressed. Also, since these issues are all matters of state law, a local attorney can advise you about how the process works, give you some talking points to discuss with your family, and help you finalize your documents. Digital Planning Lastly, while the above might require some emotional discussions, discussing with the family how to handle the email and social media accounts (Facebook, twitter, Instagram, LinkedIn, Snapchat, etc.) will feel like a lighthearted way to end the discussion. This Blog is made available by the law firm publisher for educational purposes only as well as to give you general information and general understanding of the law, not to provide specific legal advice. By using this blog site, you understand that there is no attorney client relationship between you and the law firm publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney.

Harassment in the Workplace

Monday, 10 October 2016 by Staff, Spaulding Law

In a litigious age, it is incredibly important to have sound policies and training in place at any company. One potential high risk area for companies is harassment in the workplace. Harassment is unwelcome conduct that is based on race, color, religion, sex, national origin, age, disability, or genetic information (U.S. EEOC). This can take on a couple of different forms: Quid pro quo (“this for that”) and a hostile work environment. • Quid Pro Quo: Deals directly with the consequences of the choice of an employee when they accept or reject unwelcome conduct. For example, a man does not receive a deserved promotion because he refused his boss’ sexual advances. • Hostile Work Environment: A reasonable person would find the atmosphere of the workplace to be intimidating, offensive, or hostile. Some examples of this behavior might include the following: o Offensive jokes o Unnecessary or inappropriate touching o Sexually suggestive or racially insensitive pictures o Crude or derogatory language Sometimes co-workers share something they believe is “all in good fun” and somebody is offended. The behavior may not have been intended to intimidate or offend their co-worker, but offense is the result. Not every offense will require discipline, but companies should be sure to take some sort of action when the harassment is unlawful. Harassment becomes unlawful when it is a condition of employment or the behavior is severe or pervasive enough to create a hostile work environment. Pervasive harassment includes an ongoing series of actions. One act on its own might not be enough to be considered harassment, but it would be considered harassment if a series of similar actions show a pattern of hostility. Severe harassment only requires one act on its own that clearly shows hostility to one of the protected classes mentioned above. Policies and training are important because employers are liable for the harassment that happens in the workplace and through work sponsored events. An employer can only avoid liability if they 1) reasonably tried to prevent or correct the behavior, and 2) the employee unreasonably refuses to accept any of the preventative or corrective solutions provided by the company. Contact an expert in employment law to help you create or review your company’s current harassment policies. An expert can also help provide the best advice for dealing with a harassment situation that has already occurred. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Oral Contracts – Are They Enforceable?

Monday, 10 October 2016 by Erin McAllister, Paralegal

Despite popular belief, oral contracts are enforceable. They are usually not in your best interest, and often end in a "he said, she said" battle. As long as there is enough evidence, a court will enforce an oral agreement. A verbal contract is considered valid if it contains the following elements: 1 An offer, 2 Acceptance of the offer, and 3 Consideration or something of value that each of the parties agree to give or exchange to complete the contract. So how can it be proved that an oral contract ever existed? This can be done through the actions of the parties involved. Common sense dictates that a person or a business wouldn’t provide a service or deliver the goods if an agreement with the other party didn’t exist. However, it's important to understand which types of contracts absolutely must be written in order to be valid. Generally, the types of contracts in the list below need to be executed in writing in order to be enforceable. Contracts in any of these categories entered into verbally are not automatically considered "void," however. They are typically considered "voidable" and may be either affirmed or rejected by either party at any time. Real estate sales; Agreements to pay someone else's debts; Contracts that take longer than one year to complete; Real estate leases for longer than one year; Contracts for over a certain amount of money (depending on the state); Contracts that will last longer than the life of the party performing the contract; and A transfer of property at the death of the party performing the contract. An English law from 1677, the "Statute of Frauds," provides the basis for current written contract requirements. The goal of a written contract is to avoid fraud by requiring written proof of the underlying agreement. While state laws generally dictate the enforcement of contracts, all states besides New York and South Carolina have adopted the Uniform Commercial Code (UCC) that includes some form of the statute of frauds. While oral contracts can be enforceable if they meet the criteria described above, it is always better to have an agreement in writing that memorializes the terms the parties agreed to during their negotiations. Furthermore, it is strongly encouraged to have an experienced attorney aid in the construction of such an agreement. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Creating a PTO Policy

Wednesday, 28 September 2016 by Staff, Spaulding Law

Traditionally, companies have allowed their employees to take time off under two different policies, sick days and vacation. The rules and compensation often vary under each policy. However, we are currently seeing a shift toward paid time off “PTO” policies which combine all time off into one policy where sick days and vacation days are treated the same. This allows an employee to have more control over their time. It can also be easier on the company because they have less to track administratively and it reduces the incentive for an employee to claim illness to maximize their use of the policy. Companies need to carefully consider what type of PTO policy they want to offer and the rules that govern it. Some things that should be considered are how much time an employee earns and at what intervals, whether or not there are any caps to the number of hours available at any given time, and requirements for paying out unused time. A large number of hours being taken all together or paying out a large number of accumulated hours can put a strain on a company and makes PTO a liability. Below are some ideas that could be used for a combined PTO policy that could help you manage this liability: • Limited Accumulation: Accumulated PTO can create a serious liability for a company. You may want to consider a policy that allows the employee to only accumulate a percentage of their PTO at one time. If the employee has accumulated that percentage without taking time off, they will not continue to earn PTO hours again until they have taken time off. • Limited Carryover: This policy states that an employee must use their allocated PTO by a specified time of the year (beginning of the year or anniversary of start date). At the start of a new year, the employee may carry over a specified number of hours. Any PTO hours in excess of the specified number are lost. • No Carryover: This is a “use it or lose it” approach. An employee has the opportunity to use the allocated number of PTO hours granted within a year (calendar or anniversary of start date). At the start of a new year, the number of PTO hours earned goes back to zero and any excess hours that have not been used are lost. Being aware of the state laws regarding PTO is critical. The laws on how you approach PTO are different in every state. In Utah, for example, a company is not required to provide PTO. However, if it is in the employment agreement or statement of compensation, the employee may have a claim to enforce that policy. You should contact an employment law expert familiar with your state’s laws to make sure any policy you create is enforceable and will have the desired results. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Prenuptial Agreements

Wednesday, 28 September 2016 by Erin McAllister, Paralegal

Asking for a prenuptial agreement doesn’t exactly sound like a romantic gesture. After all, couples marry for love, not money, so who needs to work out the financial details of a break-up that the couple hopes will never happen? Everyone does. Couples will accumulate assets during their marriage and even a young couple embarking on their own careers want to make sure that what they acquire during marriage isn’t left to a court to divide among spouses. Prenuptial agreements are contracts between prospective spouses that foster an environment of trust and confidence between the parties by defining property, support rights, and obligations that will develop during the marriage. At one time prenuptial agreements were looked at as an expression of greed and distrust at a time when affianced couples should otherwise be promising a lifelong bond. As prenuptial agreements have developed over the years and the courts have supported the enforceability of prenuptial agreements, a consensus has developed that enforceable prenuptial agreements may encourage rather than discourage marriage. Prenuptial agreements frequently modify the way community property laws govern assets and income accumulated or earned during marriage. Typically, absent a prenuptial agreement, all income earned during marriage as a result of labor or efforts of a spouse and assets acquired, other than by gift or inheritance, is community property (owned equally by the spouses). A prenuptial agreement can change the way income is allocated between the spouses by confirming some or all earnings to the producer as separate property. A prenuptial agreement is a good idea for most couples and is strongly encouraged for a second marriage. It is obvious that parents of children from previous relationships want to ensure the existence of an estate distribution plan to benefit the children of a previous relationship as well as children of the new marriage. A prenuptial agreement can confirm the separate treatment of property that is most appropriately designated for children of a prior relationship. Spouses should be thoughtful and retain experienced counsel before creating estate planning that will affect the entire family. While death is never a pleasant topic for newly engaged couples to consider, it is a fact of life. The importance for estate planning while drafting a prenuptial agreement is so that decisions about end of life planning also reflect the intentions of the couple. Your prenuptial agreement can enhance and support the estate planning process. Another consideration is what would happen with your assets should one of you die suddenly while you are living separately, but not divorced, versus if one of you dies suddenly while you are happily married. It is not simply for the possibility of divorce, but also for easing the transition for family members after your death. If either of you have specific family heirlooms or inheritances that you would like to be passed on to other family members instead of your spouse, this can be outlined in your prenuptial agreement. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Why an Operating Agreement is Key to a Successful Company

Tuesday, 13 September 2016 by Staff, Spaulding Law

When creating a company, you may be tempted to go for a less expensive option without some of the “bells and whistles” offered in a more expensive corporate package. One of these perceived “extra” items may be an operating agreement. However, an operating agreement is not a superfluous document. An operating agreement is like the bylaws in a corporation. An operating agreement is an important part of an entity structure for three reasons: 1) It helps to ensure courts respect personal liability protection. To be effective, one must show that the entity is separate from the individual. Having an operating agreement and abiding by its rules is one way that an entity can show this separation. 2) It sets the structure and operating rules of your entity. It may spell out how profits will be split, how major business decisions are made, and procedures to be followed for changes relating to members, avoiding misunderstandings and disputes in the future. 3) Operating agreements allow customization of the rules of the entity to the satisfaction of the members rather than being governed by the default rules of the state, which may not be to your benefit or may not take into account the unique structure of your business. It is impossible to foresee all of the issues your company may face down the road. Spending a little more money upfront for an operating agreement may save you a lot of money and headache in the end. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Registered Agent – What Do They Do and Do I Need One?

Tuesday, 13 September 2016 by Erin McAllister, Paralegal

With the formation of a new business entity, should you consider obtaining a third-party registered agent? The answer to this question is an emphatic YES. Each business entity must have a registered agent (sometimes referred to as “resident agent” or “statutory agent”) for the reasons stated below: 1. Requirement. All states require business entities doing business in their state to have a registered agent with a legal address in their state (P.O. Boxes are generally not acceptable). This requirement stems from one of the most important duties of a registered agent - accepting service of legal documents for and in behalf of the entity. 2. Protection and Privacy. The registered agent can be a third-party individual or entity that provides a legal address for the company to receive notifications. Such notifications could include legal complaints filed against the business, tax forms from the state, and renewal information from the Secretary of State. A registered agent can provide an extra layer of privacy so that the owner’s personal information can remain hidden from immediate public disclosure. 3. Convenience. A third-party registered agent will accept documentation even when you are not in your home or office and can save you the potentially embarrassing situation of being served lawsuit papers in front of customers and your family. They can also minimize the hassle of tracking registrations and renewals to help ensure that you don’t miss important filing deadlines. A commercial registered agent is available in most states. This is a person or entity that registers with the state to act as a registered agent for entities for a nominal fee. Spaulding Law is a commercial registered agent and offers these services to our clients. Most states keep a list of the commercial registered agents that are registered to do business within their state. It is important to note that a company that does not maintain an active registered agent may risk their “good standing” with the state in which they’re registered and may face fines. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Do I Need a DBA?

Tuesday, 6 September 2016 by Erin McAllister, Paralegal

Naming your business is an important branding exercise. If you choose to name your business anything other than your personal name, then you need to register it with the appropriate legal authorities. The easiest and most efficient way is to file a DBA. DBA stands for “doing business as”. Certain states and jurisdictions use the terms “fictitious business name”, “trade name” or “assumed name”. DBA registration is necessary if your business operates under a name other than its legal name. All types of businesses can use a DBA – sole proprietorship, LLCs, corporations, or partnerships. The most common reasons for using a DBA are: 1. Many businesses that are starting up are concerned about costs. The DBA filing is inexpensive and you don’t have to keep ongoing bookkeeping records and other formalities of maintaining a business right away. You can grow your business until it is running profitably and then convert it to a corporation, LLC, or other business entity. 2. Name recognition is crucial to a company’s success. Many business owners choose a different name for their business for name recognition and branding. A business name should be used in transactions including sales, marketing, advertising, and collecting monies. Some businesses want to use their business name to identify goods sold or services provided. Other businesses may also have business interests that are completely unrelated and want to separate them in the public eye by using different brand names. 3. DBAs can open bank accounts, write checks and enter into contracts. There are penalties and fines if you start doing business under a different name without creating some type of business registration. An attorney can explain the process and the benefits of registering your business. 4. If you are an existing corporation or LLC and you want to do business under a different name, you should consider registering a DBA. In most states, you must file your DBA before using your DBA in the operation of your business. This is to make sure the public is informed of your business’ existence. An attorney can help you determine what entity is right for your business and the most cost effective way to organize it. There are some disadvantages to a DBA including no liability protection. You could be personally liable for the debts of your business. Also, you may not have exclusive rights to your business name. Contact one of our attorneys to answer any questions you may have about DBAs. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Do I need an EIN?

Tuesday, 6 September 2016 by Staff, Spaulding Law

When a person is looking to start a business they have several things to consider. Whether or not to apply for an EIN is one of those crucial decisions. EIN stands for Employer Identification Number and is like a social security number that the IRS provides for a business. EINs are highly recommend for businesses because they add a level of privacy to personal information. An owner can list the EIN number on business related documents instead of their personal social security number. This limits the exposure of personal social security numbers and can reduce the risk of personal identity theft. For example, if your business acts as an independent contractor, you can provide the EIN to contracting companies for 1099 purposes instead of your social security number. It should be noted that in addition to privacy, an EIN may be required for basic business functions. An EIN is often required if you wish to open a bank account, apply for credit cards, apply for business permits, or provide 1099s to independent contractors in the name of the business. There are also some circumstances where you will be required to have an EIN by the IRS. The IRS will require you to have an EIN: • If a business has employees. • When a business has multiple owners (i.e. operates as a multi-member LLC or partnership). • When the business files tax returns for Employment, Excise, or Alcohol, Tobacco and Firearms. • When the business withholds taxes on income, other than wages paid to a non-resident alien. • When the business has a Keogh plan (tax deferred pension plan for self-employed individuals). • When the business is involved in any of the following organizations: Corporations, Trusts (except certain grantor-owned revocable trusts), IRAs, Exempt Organization Business Income Tax Returns, Estates, Real estate mortgage investment conduits, Non-profit organizations, Farmers’ cooperatives, and Plan administrators. An attorney can usually obtain an EIN with very minimal effort and cost to the client. Even if it is not technically required, having an EIN is almost always a good idea. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Find Your Voice

Friday, 17 June 2016 by Staff, Spaulding Law

“First they came for the communists and I didn’t speak out because I wasn’t a communist. Then they came for the trade unionists, and I didn’t speak out because I wasn’t a trade unionist. Then they came for the Jews, and I didn’t speak out because I wasn’t a Jew. Then they came for me and there was no one left to speak out for me.” --First They Came--Pastor Martin Niemoller. Recently, a prominent elected official admitted to having persecuted a minority group when he was an adolescent and pronounced a change of heart and deep regret. It is never an easy thing to admit error, particularly for a politician today. However, he was right--to persecute or injure any person for personal reasons, including personal gain, is an assault on not just one, but on all who reside in a civilized society, particularly one like America, whose foundational principles are predicated on agency and choice and the rule of law. This week, millions of hearts and minds go out and speak out in support of the victims of the tragic shooting in Florida early Sunday morning. Although most Americans may not be a member of what appears to be the targeted group of that insane attack, Americans should speak out against those whose hate has burst to a level of violence and terror. Human life is sacrosanct in a civilized world, and terror is the antithesis of civility. People must speak while their speaking can be heard. However, speaking does little good if clouded in prejudice or misinformation, including unfairly blaming societal ills, religious persuasion, or the tools or instruments of violence. Those who blame terrorist violence on an eroding society are largely wrong. American society does not countenance terror. One evil actor, or even hundreds of them, do not amount to more than a drop in an ocean of people or a grain of sand on a beach. American society is brimming with good, peaceful people who would never countenance such unconscionable acts of terror, and society at large should not be blamed for the acts of one or of a few. Likewise, those who blame an entire worldwide religion for countenancing terror, unfairly demonize millions by wrongly associating them with splinter terrorist groups which may share a geographic or cultural heritage but little else. This country still regrets what it did to those of Japanese heritage in the 1940s (internment camps) and should not make the same mistake again. Still others will question and accuse those who safeguard access to the instruments used to implement an attack. Experience has shown, as evidenced by the 9-11, and suicide bombing attacks in other places, that any instrument, particularly unanticipated and unsuspected or previously unutilized instruments, may be used to incite terror. Unfortunately, terrorists, may walk on any street and work, worship, recreate, and live anonymously until they strike unannounced. They will find ways to practice their craft and it is them, and not the instruments, that should bear the blunt of the blame. That is not to say that restrictive laws are unhelpful in many respects, however, their impact should be weighed against societal costs and realistic prospects of their success. In the aftermath of insanely tragic events such as the one last Sunday, commentators will comment, editors will editorialize, and politicians will rage and promise to solve the problems of violence and terror in America and across the globe. That is good--there is value and virtue in the message and to paraphrase a famous quote, all evil needs in order to succeed is for good men and women to do nothing. Doing something positive and speaking out to protect others is a duty of every American living in a country founded on the premise of life, liberty and the pursuit of happiness. Notwithstanding all society does, in the end they may still come after us. However, to simply let evil quietly have its way would be an unspeakable tragedy. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Advice Regarding Public Entity Board Leadership

Thursday, 9 June 2016 by Brady Brammer, JD MPA

1. Negotiating Complex Board Dynamics Practically speaking, negotiating complex board dynamics is difficult. Generally, it requires great emphasis on civility between the board members. The attorney and the presiding official should work together to develop and encourage behaviors and norms. Additionally, the presiding official needs clear boundaries from the attorney as to what actions (s)he legally can or cannot take. When board members lack civility and attack one another, it is more likely that the public will (1) believe the attacks, and (2) engage in the same kind of attack. Lawyers have rules of civility that encourage members not to “attribute bad motives or improper conduct to other counsel,” recognizing that such accusations bring the entire legal profession into disrepute. The same could be said for board members. While emphasizing civility, it is important that board members understand and appreciate their role to discuss, disagree, and debate policy issues. Board members need to know that they will be listened to by other board members. They also need to know that they should listen to other board members. Additionally, they need to know that they can disagree and be disagreed with as long as they do so with collegiality and respect. This process requires encouraging and supporting development of personal relationships between board members and other stakeholders. One method to address “hot” issues that board members will likely have disagreements over is to hold “work sessions” to allow board members to address and understand issues prior to voting on the issue. These have several advantages. First, although such work sessions are typically public, they are generally not well attended. Thus, board members may be able to air their grievances in a more discrete forum. Second, the work session may provide an opportunity to narrow the issues that would serve as points of debate. Third, the work session may result in proposed solutions and guidance for additional staff research on previously unknown but relevant data prior to a vote. 2. Handling Disruptive Audience Members Despite best efforts by board members, certain topics engender disruptions, disrespect, and sometimes denigration by audience members—all of which are inappropriate. A code of civility for presentation should be adopted to provide baseline rules for audience participation. Such a code should be posted or handed out at public meetings. Posting clear rules that both board members and audience members must follow will provide both guidance for behavior as well as justification should audience members violate those rules. In the event that an audience member becomes disruptive, there are several steps that can be taken by the board chair through a series of deliberate actions, not necessarily in this order. (1) The board chair should express and record their concern. (2) The board chair can acknowledge what the person is saying and offer to address it or seek to defer it. (3) The board chair can refer to the rules, the record, or the agenda. (4) The board chair can use body language, such as raising the hand in a “stop” signal in an attempt to isolate or suppress the misbehavior. (5) The board chair can order a break and try to speak to the disruptive member personally to explain concerns and seek more constructive behavior. (6) The board chair can ask for group support from other board members to discourage and suppress the disruptive conduct. (7) Under U.C.A. § 52-4-301, the board chair may remove the disruptive person if the willfully disruptive behavior seriously compromises the orderly conduct of the meeting. A board may also take other action to help diffuse anticipated problems, including holding meetings at a location more conducive to discussing the issue. Some forums can create an impersonal atmosphere prone to confrontation. Alternatively, other forums may be more appropriate to the issues and audience. The room set up (audio, seating, and lighting) can also impact the way that confrontational issues are handled. Additionally, specific people with a propensity to be disruptive can be invited to discuss issues of concern in work sessions to allow airing of grievances prior to the meeting. Community members that are particularly insightful on issues may be invited to address issues at the meeting to show support of positions differing from those that are prone to be disruptive or respectfully expressing the views of the possibly disruptive person. Finally, it is important that board members are aware of both their language and body language when differing opinions are presented to the board. Crossing arms, rolling eyes, grimacing, looking disinterested, and other expressions can turn a disagreeing audience member into a disruptive audience member as that audience member may feel disrespected or disregarded. 3. Holding Closed Session Discussions Closed sessions may be held to discuss collective bargaining, litigation, property acquisition, and employment issues, among others. The exact items that are eligible for closed session discussions are set forth in U.C.A. § 52-4-205. A board may close a meeting upon two-thirds of the members approving the closing of the meeting. Although the contents are generally not available to the public, such meetings are recorded pursuant to U.C.A. § 52-4-206. Because closed meetings are recorded, it is important that the same rules that apply to the procedures and behavior of board members are applied in both closed and open meetings. Closed meeting can be challenged and the record can be made public under U.C.A. § 52-4-304. 4. Effectively and Efficiently Managing the Board’s Agenda Generally, the policies adopted by the board will provide guidance as to how matters are placed on the agenda. Typically, the board chair or other leadership determines the agenda items, although board members should have some ability to place matters on an agenda. Staff members should prepare staff reports and submit a packet of the agenda and all staff reports with sufficient time to allow board members to review, research, and discuss agenda items prior to any meeting. Time limits for public comments and time guidelines for specific issues may be appropriate. Items that are particularly contentious or complicated may require special care to make sure that the public has received the information necessary and that the board understands public concerns on the issue. Additionally, special meetings may need to be designated to deal with specific issues. Meeting events that include large numbers of guests, such as student reports or performances, or items that would involve lengthy discussions should be placed on the agenda in such a way as to allow smooth transitions. For example, if a large number of people will be leaving after a specific item is discussed; it is wise to place a short recess on the agenda to allow crowds to exit the meeting prior to moving onto other agenda items. Additionally, for complex items requiring debate, it may be prudent to address those items at the beginning of the meeting, when board members are fresh, or at the end of the meeting to minimize distractions, depending on the circumstances. 5. Creating Effective Board Governance Creating effective board governance requires a substantial investment in the creation and compliance to board policies. This creates a clear governance structure. Additionally, it requires an investment in the personal relationships between board members, attorneys, and staff. It is important that lines of communication between the board and the administrators are both clear and open. Effective boards take great efforts to develop and maintain collegiality, trust, and an atmosphere of constructive debate and planning. Additionally, while overseeing administrators, effective boards should not seek to micro-manage operational issues. Rather, board members should focus on planning and major decisions that help the entity progress toward meeting the core objectives and goals. Much of the practice of law involves creative problem solving and development of win-win solutions, often within a climate of contention and distrust. Spaulding Law attorneys are committed to the success of our clients and experienced in finding solutions and addressing disputes in a professional and civil manner, no matter the setting. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Utah Legislative Changes to Non-Compete Covenants in Employment Agreements

Friday, 27 May 2016 by Staff, Spaulding Law

In the 2016 General Session of the Utah Legislature a law was passed that limits some non-competition agreements. The law is found in Utah Code Annotated 34-51-101 through 301 and is called the “Post-Employment Restrictions Act.” The Post Employment Restrictions Act defines a “Post-employment restrictive covenant,” a “covenant not to compete” or a “non-compete agreement” as “an agreement, written or oral, between an employer and employee under which the employee agrees that the employee, either alone or as an employee of another person, will not compete with the employer in providing products, processes, or services that are similar to the employer’s products, processes, or services.” Significantly, the law states that a post-employment restrictive covenant (non-compete agreement), does not include (a) non-solicitation agreements (agreements that are designed to keep a terminating employee from contacting or “soliciting” fellow employees or other parties in contact or association with the employer to follow the terminating employee); or (b) nondisclosure or confidentiality agreements. This means that the new law does not have any impact on a non-solicitation or confidentiality agreement. The Post Employment Restrictions Act is fairly brief and direct. It states that in addition to any requirements (limitations) imposed by the common law (judicial rulings), for a non-compete agreement entered into on or after May 10, 2016, an employer and an employee may not enter into a non-compete agreement for a period of more than one year from the day the employee is no longer employed by the employer, otherwise the restrictive covenant (non-compete covenant) is void (unenforceable). The new law has exceptions. In addition to not applying to non-compete agreements entered into prior to May 10, 2016, in Utah Code Annotated 34-51-202, the law states that it does not apply in two other circumstances. First, it does not apply when a non-compete covenant is made a part of a “reasonable severance agreement mutually and freely agreed upon in good faith at or after the time of termination.” Second, it does not apply when the non-compete is agreed to in connection with the sale of a business if the “individual subject to the non-compete receives value related to the sale of the business.” Thus, if you enter into a severance contract at the time of termination, or if you sell your business, you can still be bound. Perhaps the most significant part of the new law is a provision that awards attorneys’ fees against an employer if the non-compete covenant subject to the new law is challenged and the former employee prevails. What this provision will do is encourage former employees who are subject to a non-compete to engage legal counsel and challenge an illegal restrictive covenant and have the ability to offer statutory legal fees. The inability of a victim of an onerous non-compete covenant to engage and pay for an attorney has been a barrier in the past, however, the new law will act to balance the scales between an overly-aggressive employer and an employee without the resources to hire counsel. Disclaimer: this article is for information purposes only and is not considered legal advice and does not create an attorney client relationship. If the reader has questions, he or she should consult competent legal counsel. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Protecting Your Personal Residence with a Trust

Wednesday, 18 May 2016 by Brendan Bybee, JD MPA

Last month, I wrote about protecting your home in an LLC. This post adds to that discussion, presenting another approach to protecting your most important asset. Whether you live in a castle or a cottage, your home has sentimental value in addition to its value as shelter. Protecting what is often your most valuable single asset can be challenging, especially when it is also your most likely source of personal injury liability. Like LLCs, trusts are used to remove property from your personal ownership in order to provide protection. Trusts, however, have their own unique strengths and weaknesses. To review in brief, when considering strategies to protect your home you must consider threats against property from inside claims and from outside claims. With regard to your house, an inside claim refers to liability arising from the asset itself, like a claim against your house for an injury that occurred to another on the property. Outside claims would refer to threats to your home ownership arising from your personal liability, such as a judgement against you arising from a malpractice claim or a car accident you were involved in. Certain types of irrevocable trusts are commonly used for asset protection. These trusts, often referred to as “asset protection trusts,” work by removing certain property rights from your control and vesting them in a trustee. With these trusts, you may retain the beneficial interest in the property as a beneficiary of the trust but you cannot control the distribution of those benefits. For example, if cash is contributed to this kind of trust, you, as the beneficiaries, are the only ones who can benefit from the contributed cash. However, you cannot control when and how those distributions are made. Only the trustee can do that. That limitation is what provides the protection. Outside claims, do not reach the property because the assets are not legally under your control. Contributing your home to a trust like this can allow you to continue living in your home while keeping it protected from your personal liability. This strong protection from outside claims sets trusts apart from LLCs. Your personal liabilities can cause your LLC interests to be encumbered or divested because you own them. On the other hand, a properly formed and managed trust should be entirely immune from your personal liabilities. Because you no longer own or control the property, holding your residence in this kind of trust also protects your other assets from inside claims arising from injuries occurring on the property. Because the trustee has legal title to and control over the property, the trustee is responsible for the condition of the property and is liable for claims against the trust arising from the property. Under Utah law, your trustee is personally liable “only if the trustee is personally at fault.” This means that your trustee can be held liable for both intentional or negligent action or inaction regarding the property that results in an injury. In most cases the assets of the trust will be available to satisfy any judgment, similar to the result if the asset were owned by an LLC. However, if the injury is well beyond the value of the property, your trustee could then be liable if the property is underinsured. Use of an irrevocable trust to protect your home is a well-established practice and a good fit for many who are concerned about the minimal homestead protections offered in Utah and other states. However, this kind of planning is not the proper subject of self-help legal services. This is sophisticated planning that will require education and support in addition to properly prepared documents. It is also critical to remember that use of such a trust is only part of the equation. Any comprehensive strategy will include consideration for proper insurance to protect your home and your trustee, including the reevaluation of existing insurance to ensure that it protects the proper interests after a transfer of title. Once things are properly organized, though, life pretty much goes back to normal except that you just may sleep a little better at night. If you have questions about whether this strategy might work for you we are happy to schedule a free consultation. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

The Power of Security in a Financial Transaction

Friday, 6 May 2016 by Staff, Spaulding Law

Not long ago someone died leaving a nice estate to the heirs. Some of the assets included some land that was undeveloped. On other parcels there were buildings, some of which were old, and some of which were not worth as much as the land they were built upon. Also in the estate was a promissory note (“Note”), promising to pay an amount over time. However, the Note was “unsecured”, meaning that it was 100% reliant on the ability of the person who signed the Note to make the payment, and was not “secured” with “collateral.” A Note is a promise to pay an amount of money which is made by the signer, normally referred to as a “Maker”, to someone normally referred to as a “Holder”. The Note will typically contain terms such as the number and frequency of payments, an interest rate charged for the duration of the Note (until all payments are made and the debt is retired), and terms of delinquency or default. If a Note is secured it will typically indicate that it is secured and will be accompanied by a companion document. In Utah, if the Note is secured by a house or land, for example, the security document is called a Deed of Trust, or a Trust Deed. Anyone who has financed the purchase of a home in Utah has seen and signed a Trust Deed. The Trust Deed allows the Holder of the Note to commence foreclosure proceedings to sell the house if the terms of the Note are not met. A Note can be secured by other types of collateral, including shares in a corporation or a limited liability company or by other assets like a car. A lien on a car title is security for a Note made by a purchaser. According to the terms of the Note, upon a failure by a signer to make a car payment, the car can be repossessed and sold according to the terms of the security documents, with the debt reflected by the Note to be paid with the sales proceeds. The Note which was a part of the estate of the man who died, was signed by someone who owned both real property and land worth well over $1 million. Therefore, there were sufficient assets to “secure” the amount promised to be paid under the Note. However, because the Note was signed without requiring any “security” the risk to the estate is that it may never be able to collect the significant amount due under the Note, because upon a default there is no claim to the property owned by the Maker, just a claim on the Maker. Securing a Note has other advantages as well. For instance, an unsecured Note is less likely to be paid in full if the Maker files for bankruptcy. In a bankruptcy, if an obligation is secured by property the Holder will normally be allowed to foreclose on the security. On the other hand, if the debt is not secured, the Holder is grouped with other unsecured creditors who must wait until the secured claims are paid in full. If there are still assets remaining for a payment to unsecured creditors after the secured creditors are paid, the unsecured creditors can share remaining assets pro-rata with each other. Another benefit of securing a debt is that if the borrower decides he wants to sell the property used to collateralize the loan, he must first contact the Maker and make arrangements to either pay off the debt or negotiate a favorable resolution. In either event, security places the lender in a more-secure position to be repaid. The point is that when someone loans a substantial amount of money, whether to a family member, a friend, or a business associate, it is important to consider how best to document the transaction. The advice of a capable attorney can help you best understand how to protect yourself financially with “security” if you choose to make a loan or finance the sale of an asset. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Protecting Your Personal Residence with an LLC

Monday, 11 April 2016 by Brendan Bybee, JD MPA

Your home is much more than merely your castle. It is a place where memories are made and stored and protecting and preserving one’s home is a universal concern. Homestead laws have been enacted in many states expressly to preserve your home against your creditors when things go awry. Due to Utah’s paltry homestead exemption (protecting a mere $30,000.00 in equity, or $60,000.00 for joint owners), many residents have to look elsewhere to ensure their home is safe. This post will discuss one possible option and its limitations. General Asset Protection Considerations Asset protection strategies have to consider threats against property from two different sources; inside claims and outside claims. Inside claims concern liability arising from the asset itself, like a personal injury claim against real estate on which an injury occurred. Outside claims concern threats against property owned by the responsible party but arising from injuries unrelated to the property; like a claim against your house made by someone injured in a car accident you were involved in. Strengths and Weaknesses of Holding Your Home in an LLC LLCs are ideal vehicles for containing liability producing assets. This is why we often recommend them to our clients for holding rental properties. When a person is injured on rental property within a properly created and managed LLC, their “inside claim” is limited in recovery to the assets of the LLC. The claim is contained and does not extend to personal assets of the LLC owner. This is why LLCs were created; to encourage business activity by containing the risk involved in new business ventures to the assets of the business. A basic requirement of an LLC is that it have a “business purpose” and the protections only apply if the LLC is treated as a business. Mingling business and personal activity jeopardizes liability containment and could render your personal assets subject to inside claims against your LLC. For this reason, there is some risk to using an LLC to protect your personal residence. Even with a rental agreement in place it may be hard to convince a judge that your LLC serves a legitimate business purpose. Another limitation of LLCs is that they are not entirely protected from outside claims. Your LLC interest has value and if a claim is brought against you personally, your LLC interest is not shielded from your personal liability. A creditor’s primary form of recovery is the charging order; essentially a lien against your LLC interest in the amount of the debt. In Utah, a creditor may even foreclose on your LLC interest and gain ownership over the entire financial value of your LLC interest. However, because creditors usually have to wait for the LLC to distribute profits they are often more reluctant to seek recovery from your LLC assets, putting you in a better position to negotiate a favorable settlement. Finally, it’s important to consider potential tax consequences before deciding to transfer your home to an LLC. Specifically, the capital gains exclusion which amounts to $500,000.00 for a married couple, or $250,000.00 for an individual. Depending on the arrangement of the LLC, this sizeable exclusion can be lost if you ever need or want to sell your home. Conclusion: In spite of the weaknesses, many people do hold their residence in an LLC and have enjoyed the protections described above. It’s also important to know, however, that an LLC should not be considered as your entire protection strategy but, rather, as an element of a comprehensive strategy. The first step is regular property maintenance to limit the risk of negligence claims, second is maintaining adequate insurance, after that, a properly formed and maintained LLC is helpful to contain liability for inside claims and protect against outside claims. Don’t think, however, that an LLC is your only alternative to the homestead exemption. In future posts, we will discuss other strategies for protecting your residence. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Who Is America?

Thursday, 24 March 2016 by Staff, Spaulding Law

This is one of the most interesting Presidential election cycles in memory. On both sides of the great political divide, it seems like the alternatives are highly lacking in the essence of what many Americans are deep within themselves, which should reflect who inhabits the White House come January. Just last night a Super Pac (unaffiliated with any candidate, and therefore uncontrollable) ran personal attack advertisements against the wife of a leading candidate. As if that were not enough, in response, the offended candidate sent a personal threat to a fellow candidate, casting blame and issuing a personal warning of an imminent personal attack on that candidate’s spouse, if the offense were to continue. The office of President is not for the wrong person or the wrong type of person. While the power of President is somewhat tempered through constitutional checks and balances, still, the office still exists as an influential symbol of something higher than any one person. It is symbolic of a nation united, a nation that holds to values and ethics, and to the philosophy that “how we got there” is just as important, if not more important, than “getting there.” The office of President is an emblem of sorts of the stature of someone Americans admire and respect—of someone people truly believe will guide a nation through tragedy or triumph and someone that people might be willing to follow through flood and fire--someone who understands that this nation’s destiny is to be a shining light on a hill that the world can see and look to for guidance in times of trouble or despair. The office of President is designed for someone of the stature of Washington, or Lincoln, or Roosevelt or Ronald Reagan. However, tellingly, in many ways the person elected reflects who its people are. Speaking of people, a great Mormon leader, Gordon B. Hinckley said: “[w]e cannot expect to lift others unless we stand on higher ground ourselves.” Great Britain’s Prime Minister Winston Churchill declared: “[t]he truth is incontrovertible. Malice may attack it and ignorance may deride it, but in the end, there it is. And Thomas Merton said: “[w]e must make the choices that enable us to fulfill the deepest capacities of our real selves.” The junction of these three statements has application to the campaign for the office of President and for all Americans. America is looking for someone to lead--someone who can lift others, by standing on higher ground. America is looking for someone who is willing to lead with truth and character, and not with malice or derision. And America badly needs a leader who will make choices which will enable all Americans to enjoy the freedom to fulfill the deepest capacities of their real selves. Individual Americans cannot control who fills the office of President, but each has power to control themselves and aspire to be the type of person worthy of the office of President. Americans moving to higher ground, standing for truth against malice and ignorance, and making sound choices consistent with personal capacities is a key not only to individual success and fulfillment, but to attracting and electing the type of national leaders worthy of those they lead. At the end of the day, the answer to a question about who America is may very well depend on individual Americans, for as the great philosopher Alexis de Tocqueville stated: “America is great because she is good.” It therefore goes without saying that good Americans will attract and elect someone worthy and great to the office of President. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Advance Health Care Directive

Wednesday, 23 March 2016 by Erin McAllister, Paralegal

The process of dying has been found to be prolonged, painful, expensive, and emotionally burdensome to both patients and their families. By thinking ahead and communicating treatment preferences early on, you can prevent arguments and spare those close to you the anxiety of having to guess your wishes. Most important, you will have the opportunity to make very personal health care decisions for yourself. This sentiment has encouraged the creation of health care directives. An advance health care directive, also known as a living will, is a legal document in which a person specifies what actions should be taken for their health if they are no longer able to make decisions for themselves because of illness or incapacity. An Illinois attorney, Luis Kutner was the first to propose a directive in a law journal in 1969. Because this form of “will” was to be used while an individual was still alive (but no longer able to make decisions) it was dubbed the “living will.” In the United States, The Patient Self-Determination Act (PSDA) went into effect in December 1991, and required health care providers (primarily hospitals, nursing homes and home health agencies) to give patients information about their rights to make advance directives under state law. Determining the course of one’s health care proved to be very popular, and by 2007, 41% of Americans had completed at least a living will. In response to public needs, state legislatures soon passed laws in support of advanced health care directives or living wills in virtually every state in the union. An advance health care directive will name your agent or attorney-in-fact. This is the person you have chosen to carry out your wishes concerning your health care when you are no longer able to communicate your wishes. You may also name alternates to take the place of your first choice should that person be unwilling or unable to serve as your agent. A directive usually provides specific instructions about the course of treatment that is to be followed by health care providers and caregivers. A person might decide to use the Do Not Resuscitate (DNR) order if their quality of life is depleted and will not return. Another person might choose to donate their organs. Still another person might want to be part of any clinical or research trials that are ongoing in attempting to find a cure for the disease or condition inflicted upon the patient. In all cases, the health care directive can allow family members or trusted individuals to access the patient’s medical records. It may also be used to express wishes about the use or foregoing of food and water, if supplied via tubes or other medical devices. The health care directive may include information regarding an individual's desire for such services as pain relief, antibiotics, hydration, feeding, and the use of ventilators or resuscitation. Advanced health care directives have proven to be helpful tools for those individuals that want to have some control over their future health care needs. They can bring peace of mind to the potential patient and his or her family prior to the difficult time that comes with end of life. Family members and trusted individuals can rest assured that the wishes of their loved one is being followed as much as is possible. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

WHO DO YOU TRUST?: Selecting Fiduciaries for Your Estate Plan

Thursday, 17 March 2016 by Brendan Bybee, JD MPA

One of the primary purposes of estate planning is to ensure that things are taken care of when you are not able to take care of them yourself. For a comprehensive estate plan, this applies to life as well as death. Choosing your fiduciaries, those who will represent you, is your privilege for planning ahead. But, for some, this privilege can be stressful and confusing. What is a fiduciary? The word “fiduciary” is derived from the Latin word for trust or confidence. We use that word to describe people in certain positions of trust who have special duties to those they serve or represent as a fiduciary. Setting up your estate plan requires you to choose trustees for your trust, executors for your will, and agents for your medical and financial powers of attorney. Each of these is a fiduciary because they are in a position of trust and owe certain duties to you and to others close to you. Deciding who to name is like considering who you’d trust with a blank check. What does a fiduciary do? A fiduciary represents you with respect to a variety of personal, usually financial, concerns. Subject to the scope and terms of the authorizing instrument (that is, the document you named them in) they are able to act for you in any way in which you could act for yourself. They can write and cash checks for you. Buy and sell property for you. Make medical decisions for you. Make investment decisions for you. Make gifts on your behalf and read your mail. Though you do get to determine the scope of your fiduciary’s authority, you will have to consider the tradeoffs of granting broad or limited powers. In addition to any limitation you may place on them, fiduciaries have a legal duty to act loyally and in your sole interest. These fiduciary duties are also owed to those with whom you have a special relationship such as your family and beneficiaries. Who may be a fiduciary? Generally speaking, anyone over the age of eighteen can be a fiduciary. However, fiduciaries who are appointed by court order, such as your executor, may be disqualified to act if they have felony convictions or other circumstances that would make them unfit for such trusted service. Hopefully, your pool of potential candidates will give you so many comfortable options that cousin Jerry’s jail time doesn’t spoil your plans. If not, you may wish to name a professional or institutional fiduciary to administer your estate or trust. Many attorneys and accountants offer fiduciary services and many banks have trust divisions that handle probate and trust administration. There are also private trust companies offering fiduciary services independently from whatever wealth management services you may have in place. Using a professional or institutional trustee will usually cost more but they have more experience and expertise and are free from the interpersonal conflicts a close friend or family member might have. Additionally, professional and institutional fiduciaries are subject to a higher standard of competence and financial stability meaning that they are less likely to make grave mistakes and more able to compensate you if they do. Special Considerations Because of the amount of trust placed in a fiduciary, making the right choice is always important. However, some circumstances make the decision even more critical. If you have a blended family or a history of conflict the right choice can mean the difference between leaving your estate to your beneficiaries or leaving it to their attorneys. In other cases competence and experience can be just as important as trustworthiness such as with special needs trusts and charitable trusts due to their complicated administrative procedures. Whatever the circumstances, choosing your fiduciaries is a personal decision with unique factors to consider. Making these important decisions with the guidance of experienced counsel can make all the difference in providing you and your family with peace of mind. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Durable Power of Attorney

Thursday, 3 March 2016 by Erin McAllister, Paralegal

A durable power of attorney is an essential part of any estate plan. People often use durable powers of attorney to appoint someone to handle their financial affairs if they become incapacitated and unable to make sound financial decisions for themselves. The person authorized to make decisions is known as the Attorney-in-Fact. The party who is authorizing the agent or attorney is referred to as the Principal. The Principal must make their determination of who they want to act as their Attorney-in-Fact when he/she has the soundness of mind and an intelligent understanding and perception of one’s actions. In other words, a durable power of attorney is created by a person who wants to choose the person to make financial decisions for them once they become incapacitated and cannot make those decisions for themselves. A durable power of attorney must be in writing, be dated and signed before a notary public. The Attorney-in-Fact must be 18 years or older. Your Attorney-in-Fact has a fiduciary obligation to act in your best interest and avoid gaining a personal benefit at your expense. You should be very careful when choosing your Attorney-in-Fact. It should be someone you trust and feel confident that they can and will handle your financial decisions for you. Before you name someone as your Attorney-in-Fact, you should talk to that person and get his or her consent. The person you choose as your Attorney-in-Fact should know that he or she has a duty of trust and must always act in your best interests. You can also name an alternate Attorney-in-Fact to act for you if your first choice cannot. Once a person is considered incapacitated and unable to make decisions for themselves, they can no longer create a power of attorney. An interested person must go to court and attempt to get a guardian or conservator appointed to take care of the incapacitated person and their finances. The decision is taken out of the hands of the incapacitated person and their wishes may not be known or followed. This process requires patience as the process of going through the courts is more difficult, costly and lengthy. A durable power of attorney usually lists specific powers that are granted to the Attorney-in-Fact. For estate planning purposes, the following powers are often included: 1. Medical Care. To arrange for medical, surgical, hospital, nursing and convalescent care and treatment that is subject to any advance healthcare directive. 2. Collection. To oversee collection of any funds or properties that may be made payable to the Principal. 3. Payment. To make payments on behalf of Principal. 4. Banking. To sign, endorse, deposit, withdraw, purchase, or redeem. 5. Purchase and Sale. To purchase, acquire, lease, exchange, sell and transfer any property of the Principal. 6. Tax Matters. To prepare, sign and file tax returns and any other documents as needed. 7. Agents. To hire and dismiss agents to act for the Attorney-in-Fact in Principal’s behalf. 8. Receipts. To execute all instruments in connection the financial responsibilities for the Principal. 9. Gifts and Estate Planning. To make gifts and to continue the estate planning that Principal had commenced prior to becoming incapacitated. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Spring Has Sprung

Thursday, 3 March 2016 by Staff, Spaulding Law

Spring has sprung. Just look around and you can’t miss it! Birds are chirping in the trees and chasing one another through the sky. The sun wakes up earlier and retires ever later. Children will soon get restless for summer break, and the NCAA tournament is just around the corner. On the business side of spring, it’s almost time for spring cleanup—time to get the sprinklers tuned up for a hot summer--time to get to all those leaves swept under the first big snow--time to put away the sleds and the skis and get the mower tuned before everyone wants it done all at once. It’s at once exhausting and invigorating--a delightful time of year, because it’s still cool enough that sometimes it’s downright cold, but the air is moving--the incessant inversion is gone, and everyone knows that comfortable, jacket-free weather, hike-in-the-mountains, boating-at-the-lake weather is just around the corner. Yes, although there may yet be a snowstorm or two in the forecast, the worst is behind us and the best is just ahead. Springtime hints of new and fresh and young. Springtime inspires. "Younger than springtime" is a favorite chorus line from a Broadway musical because spring rings with new life and new beginnings. This spring, some will look at the yard and think it’s time to fertilize so the lawn gets green more quickly. Like with a lawn and in other things, some choose to invest in the prospects of a quicker return, while others do not, choosing simply to metaphorically “water the lawn” and hope for the best. And for those who fertilize, some products have additional preventatives included so that weeds don't even have a chance to germinate, which may cost a little more upfront but can provide a better result and save some work with a hand-held weed sprayer later in the summer. Starting a new business is a lot like getting ready for summer. Investing a little bit of time and money on the front end as things get set up, and engaging professionals who understand things like business structure, contracts and even the tax side of investing, can prevent a lot of “weeding" during the "summer months" when things get interesting or even a little “hot” when one might otherwise be enjoying the fruits of earlier labors. As they say, an ounce of prevention is better than a pound of cure, and unfortunately in business, as in lawn care, there is potential for weeds. Matters involving state and local government licenses and regulations, business contracts and, sadly, opportunistic and dishonest people can really distract from otherwise profitable ventures. To extend the metaphor, without professional help, it is sometimes hard to discern between a weed and a plant early, especially in the springtime of a business opportunity. Neglecting the details and deciding to save a little on the front end by neglecting the basics, or relying on public information found online, can be a lot like just watering the lawn. Who has not heard about the aspiring business that faced too late the crucial truth that something as simple as a misunderstood sentence in a consulting or supply contract may cause or prevent a critical cancellation, resulting in a significant disadvantage and loss at the wrong time? Who has not heard of the loss of control of a business to a greedy partner or the filings of bankruptcy simply because of a broken handshake promise? Talk about April showers! Solid and experienced legal advice is rarely free, however, like a good lawn maintenance program, it can save time, effort and even money in the long run, particularly when someone is putting in the effort to building something valuable and something that will last. A solid, healthy and enjoyable lawn doesn’t just happen, and neither does a strong, vibrant and profitable business venture. Both are rewarding and both take some thought, preparation and, yes, a little investment in the basics, up front and early—during the springtime. Yes, spring has finally sprung. Here’s to a great summer, notwithstanding the heat! This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

How the ATF’s New Rules Affect Your Next Firearms Purchase

Thursday, 25 February 2016 by Brendan Bybee, JD MPA

On January 15, 2016, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) published new rules affecting the transfer of firearms regulated by the National Firearms Act (NFA). These changes have been on the horizon for a while now and will go into effect July 13, 2016. The new rules represent significant changes to how you buy and sell your regulated firearms and may influence when and how you make your next firearms purchase. What if you don’t have a gun trust? If you don’t have a gun trust, you may want to wait until after the rules go into effect before your next NFA regulated firearms purchase. Under current rules, the purchase of a regulated firearm by an individual requires signed certification of your local “chief law enforcement officer” (CLEO). This requirement has long been a big driver for gun trust purchases because it effectively gives your local CLEO veto power over your purchases, putting you at the mercy of your CLEO’s personal philosophy. Once the new rules are in force, you will only be required to send notice of your purchase to your local CLEO, cutting out a big obstacle in the process. As always, individual purchases will require submitting passport photos and fingerprints. How will the new rules affect my gun trust? Though the new rules diminish some of the advantages we’ve become accustomed to, we still recommend owning and purchasing regulated firearms in a gun trust. Like individual purchases, your trust will need to submit notice of your purchases with the local CLEO. Trusts will also be required to submit photos and fingerprints of all “responsible persons,” which is understood to mean all acting trustees. This will add time and expense to the process and diminish some of the privacy benefits previously enjoyed with gun trusts. As compared with purchasing as an individual, trust purchases will be slightly more burdensome to the extent that your trust has multiple trustees. However, submission of photos and fingerprints will cover all purchase applications by your trust for the next two years, assuming there is no change in the composition of trustees. Even though the process of purchasing is changing, the reasons for owning your firearms in a properly drafted gun trust remain the same. Laws regarding possession of regulated firearms are notoriously strict and the penalties steep. Gun trusts provide a means to safely manage and share experiences with your personal firearm collection without risking unintended felonies. Your gun trust also ensures that your firearms can be managed by someone you trust in the event of your incapacity and distributed upon your death without implicating ATF transfer regulations. Because the laws and regulations affecting possession and transfer of regulated firearms are so thorny it is critical that you treat these assets differently than your other property and make a gun trust a part of a comprehensive estate plan. Get your gun trust now! If you set up a gun trust before the rules take effect, you can take advantage of the current rules applying to trusts. You just need to make sure any ATF application for a firearms purchase is postmarked before July 13, 2016. Unlike purchasing as an individual, purchasing regulated firearms through a gun trust under current rules requires neither notice nor certification from your local CLEO. Additionally, timely applications won’t require photographs or fingerprints of the trustees. ATF applications are likely to take much longer after the new rules take effect given the bureaucratic learning curve associated with new rules and the additional submission requirements. If you have been contemplating a purchase, you should take advantage of the old rules while you still can. Spaulding Law can help. Click here to get started on your gun trust. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

SMOGGY FEBRUARY

Friday, 12 February 2016 by Staff, Spaulding Law

Here it is, mid-February, and it’s freezing outside. The inversion is trapping cold to the earth like a wet blanket traps a fire and it’s hard to breathe the thick air, much less imagine the coming spring weather and the sunshine of April. The one fully--take it to the bank--positive thing about February is Valentine’s Day. Who doesn’t remember Valentine’s Day cards at school—or the little heart-shaped candies with cute phrases like “Be Mine” or “Love” or “Truly Yours” with the pitter-patter of hearts, young and old, as children of all ages hope someone, anyone, will ask to be their Valentine. Way back in memory’s recesses, February stood for something other than cold and smog and damp depressing darkness. It stood for love and warmth and exciting hope. Fortunately for February there is a Valentine’s Day but notwithstanding that, it is sometimes hard to see and feel joy in the Februarys of Utah. Unfortunately, it is far easier to see more mundane things in February such as laws and budgets, and discussions of school funding, road funding, and policies that will shape society for long after the last 10-year old boy hopefully hands a Valentine’s Day card to that cute girl in his fourth-grade class. That is because, for those who care, February is the heart of the annual Utah legislative session, which begins on the fourth Monday in January. Starting that day, the Utah legislature is “in Session” for 45 consecutive days, or through the entire month of February. In recent memory, the only year the Utah legislature was not in Session during the entire month of February was in 2002, when the Utah legislature took an unprecedented official recess during the entire 2002 Salt Lake Winter Olympic Games. You could say that during that February, all of Utah hit the pause button to celebrate and enjoy a once-in-a-lifetime February experience. And it truly was such an experience. In a traditionally inversion-laden February, when so many are stuck in the winter rut between Christmas and Springtime, and when for many, there is not much of love, attention or romance, folks would do well to remember the days and weeks leading up to those 2002 Winter Olympic Games, when Utah’s star shined brightly before the world as never before. During that winter of 2002, immediately prior to the lighting of the Olympic torch at Rice-Eccles stadium, Utah had very little snow and was mired in an un-customarily long and dirty inversion. Olympic organizers, particularly those with “image” on their minds, were justifiably worried. Many hoped, prayed, and held their collective breath to see how Utah would be received by not just a nation, but also a watching, curious world. Among other preparation-related activities, what was hoped and prayed for was a literal miracle--a snowstorm to deliver fresh air and deep, clean, new snow on the rugged, but relatively unknown, Wasatch-range. The entire world tuned in, many for the first time ever, to see all that Salt Lake City and Utah had to offer. Actually, it was a huge financial and cultural gamble—hosting the Winter Olympic Games-- and joyous it was when, on the very eve before the lighting of the Olympic torch, Utah was blanketed with a magnificent winter snow, which scoured the valleys of smog and left a scene so pristine that it sparkled—rivalling a fresh Christmas morning. It was indeed a miracle in February of 2002, as the skies above opened on the mountains and valleys, on the people, the community and on all who watched both here and throughout the world, as Utah welcomed--everyone. And ring out Utah did as Salt Lake became a stunning city in the Rockies—the Olympic rings were on fire nightly on the Eastern hills, and downtown high-rises were draped with images of athletes carving slopes, cutting figures on rinks of ice, and catapulting along the city skyline in the winter night air. It was picturesque, wholesome, refreshing, and spectacular all at once and became a tribute, not just to the planners and workers of this community and State, but to the history and the essence of Utahns--who they are and what they represent. It wasn’t just a proud time in our history—it was a button-busting experience every single day for every resident. It changed Utah and it changed the world to a lesser extent. After that Olympic experience, all of Utah knew that everyone, everywhere understood the secret that only a relative few really had known prior to that February fortnight—that Utah not only has what some might call the Greatest-Snow on Earth, but also the greatest people on the planet. It was truly a world-class, once-in-a lifetime experience for all, particularly for a normally dreary and smoggy February. All of this month it is February along the Wasatch Front and it’s smoggy and cold outside. However, today, here’s to Utah, Utah’s rich and miraculous history, refreshing snowstorms, and, well, love for everyone. Happy Valentine’s Day and happy memories, to all with young hearts, the young and the old alike. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Estate and Financial Planning

Wednesday, 10 February 2016 by Erin McAllister, Paralegal

When your health starts to decline, you start to lose control and certainty. Having a comprehensive estate plan in place can give you back some control and alleviate the uncertainty. Over 120 million Americans are living with a chronic illness, such as Alzheimer’s Disease, COPD, Parkinson’s Disease, or Multiple Sclerosis. Living with one of these diseases can mean facing years of uncertainty and disability. An estate plan can help you plan for your estate and financial matters, and alleviate the worry caused by your chronic illness. If you do not have an estate or financial plan, you are not alone. According to the NAEPC Education Foundation statistics, many Americans do not have a proper estate or financial plan. It is estimated that 120,000,000 Americans do not have up-to-date estate plans to protect themselves and their families in the event of sickness, accidents, or untimely death. A survey from 2010 by Lawyers.com found that 35% of Americans now report having a will and only 21% have a trust arranged. A more recent survey by EZLaw found that only 44% of Americans report that they currently have any estate planning documents. Estate and financial planning might be new and unfamiliar to you and might sound overwhelming. However, with a little education and a step-by-step approach, it will no longer be unfamiliar or overwhelming. The following list are some things you can do to prepare for your future: 1. Organize your emergency information and information about your advisors. 2. Designate a person to handle your financial and legal issues by creating a power of attorney. 3. Designate a person to make health care decisions and access medical records by creating a health care directive. 4. Communicate your health care wishes with your designated person for health care decisions. 5. Protect your minor children by obtaining a will that allows you to name your children’s guardians. 6. Create a personalized revocable trust to manage your assets during your disability or illness. 7. Ensure that your insurance coverage is in order. 8. File your beneficiary designations and confirm title to your accounts. 9. Give back so you can demonstrate important values to heirs, help others, and inspire others. 10. Communicate your estate and financial plan to your advisors, family, and friends. 11. Check the beneficiaries on life insurance policies and retirement plans. 12. Review, revisit, and revise your plan so it can continue to protect you. When undergoing treatment for an illness, many times there are medical expenses that are not covered by insurance. Items such as home health assistance, wound care supplies, over the counter products, and travel for treatment are a few to consider. These may result in a sizeable deduction on the tax return. There are some chronic illnesses that leave the patient physically here, but not mentally here. An estate plan in which the patient has had the opportunity to make their wishes known will go a long way to alleviate some of the tensions and frustrations that come with chronic illnesses such as dementia, Alzheimers, etc. Additionally, if you have been diagnosed with a chronic illness or if you are advanced in age, it is also a good idea to request that at the time you sign any estate planning documents, your attorney film your responses to various questions related to prove your competency at that time. In the event the chronic illness becomes terminal, who wants to worry about financial issues? It is an unfortunate fact that money issues are a significant concern at the end of life, and it is wise to make plans and discuss those plans with the significant people in your life so you can focus on what really matters, your loved ones. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

It’s Not About Free Money

Wednesday, 20 January 2016 by Staff, Spaulding Law

How many times have we heard someone say (or said yourself): “If I only had a million bucks” or “You can marry more in 10 minutes than you can make in a lifetime.” Americans (and likely Canadians, Europeans, South Americans and even those in Japan, Taiwan and as far away as Australia) are obsessed with money. “Show me the monaaaaaay!” blasts the famous line from Hollywood. Nick Saban as the head coach of National Champion Alabama makes roughly $6 million a year, which is $500,000 a month. Today, the slightly above-average NBA player will sign a five-year contract for $70 million, which is more than $1.1 million a month; and yet—you and me--we don’t even bat an eye that someone else earns that kind of money for mere entertainment. Harrison Ford was paid a cool $25 million for the latest Star Wars episode and who knows what Mark Hamill (Luke Skywalker) was paid for his wordless, expressionless, end of movie cameo. Last week the world stopped and stared as 3 “lucky” individuals who “won” an unprecedented Power Ball lottery and split roughly $1.6 billion dollars, for buying a $2 ticket. That is roughly $500 million dollars each! The moment was so compelling that hoards flocked into one of the towns where a winning ticket was sold, and the store clerk who merely sold the ticket became an instant celebrity--his store won $1 million. Money, money, money--is our society drunken on money or what? Think of the old blockbuster “Charlie and the Chocolate Factory,” starring Gene Wilder. The storyline captivated our imagination because anyone who purchased a chocolate bar, could win a lifetime supply of chocolate (and as we know, much more for Charlie) and (in the movie) the world went completely crazy buying up chocolate bars, hoping to find one of the tickets. But the story presented a deeper message, a message that has lost its steam today, but which contrasts our current obsession with “free” or “easy” money, and no one who saw the movie and cheered for Charlie, will likely forget that message. “Actions are the seed of fate. Seeds grow into destiny” said former United States President Harry S. Truman. “Chop your own wood and it will warm you twice” said Henry Ford, the founder of Ford Motor Company and a man who knew both failure and unimaginable fortune. “Skill to do comes of doing” said the timeless Ralph Waldo Emerson. Society today, adults and children alike, need more understanding of Charlie’s factory-factor and less fascination with sensationalized salaries and “free” funds. Really, where did that $1.6 billion Power Ball for 3 “lucky” winners come from? Well, as far as we can tell, it came from the pockets of people who, on the slimmest of chances, bought roughly 900 million tickets (which is roughly 3 times the US population), and almost every single person walked away empty, without even a small chunk of chocolate. And they did it because they wanted something they had not earned. Dietitians discuss empty calories—well, that is like empty spending and empty living. Charlie bought something he enjoyed, chocolate, and in so doing, he won a ticket, however, his actions won him the opportunity of a lifetime. The message could not contrast more with the message of the Power Ball and its fuel: the crazed craving of money without action or effort. Ultimately, it was not luck that made the difference for Charlie. It was action, amplified by attitude, not a winning golden ticket; and what did it get him? A great life for him and his family. Clearly, the point is that regardless of a ticket, Charlie would have had a golden life because of who he was and what he valued. At the end of the day, a successful life is not about the money. Chop your own wood. Develop skill through doing. And “earn your own way.” It’s unlikely that Power Ball lotteries and free money will buy happiness. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Caregiving

Tuesday, 19 January 2016 by Erin McAllister, Paralegal

According to a report conducted by the National Alliance for Caregiving (NAC) and the AARP Public Policy Institute (AARP), caregiving affects everyone. Either you are a caregiver, know someone who is, or you expect to be one. A family caregiver is a person who provides unpaid care to a family member or friend (such as a child, the elderly, or someone who is sick) who needs help with everyday activities and protection. Caregiving is truly an international phenomenon. No nation is without family caregivers. There are an estimated 43.5 million caregivers in the U.S. (18.2% of the population). As baby boomers age, this number most likely will rise. The typical caregiver is a 49 year-old female caring for a 69 year-old relative due to a long-term physical condition. Twenty-two percent (22%) of caregivers are caring for someone with Alzheimer’s or dementia. The majority of caregivers are female (60%). 8 in 10 are taking care of one person (82%). A large majority of caregivers provide care for a relative (85%) with 49% caring for a parent or parent-in-law. 1 in 10 provides care for a spouse. The care given by caregivers has been divided into three categories: • ADL (Activities of Daily Living) - Bathing, Dressing & Feeding • IADL (Instrumental Activities of Daily Living) - Housework, Cooking & Managing Finances • M/N (Medical/Nursing) Tasks - Injections, Tube Feedings & Colostomy Care Higher-hour caregivers are almost 4 times as likely to be caring for a spouse/partner. Higher hour caregivers are defined as giving support for at least 21 hours each week. Higher-hour caregivers are a vulnerable population, more likely to experience emotional stress, physical and financial strain, and impacts on their health. They are performing a wide variety of care tasks for their loved one – everything from housework to advocating with health care professionals, to complex medical/nursing tasks often with little or no training. Their vulnerable position is seen in their greater desire for conversations with care professionals about their needs for both their own self-care and in providing care to the loved ones. They are more likely to want help or information about managing, and are more supportive of respite service policies. Experiencing emotional stress is more common among higher-hour caregivers. Over half of those who feel they had no choice in taking on their caregiving role report high levels of emotional stress (53%). Nearly 1 in 10 caregivers is 75 years of age or older (7%). Caregivers age 75 or older are typically caring for a close relative (spouse, adult child, or sibling). They are the sole provider of care, and usually live with the care recipient. These caregivers, on average, have provided care for 5 ½ years and spend 34 hours per week performing multiple caregiving responsibilities. Many take on medical/nursing activities with little or no training. In addition to ADLs and IADLs, family caregivers are increasingly performing tasks that nurses typically perform. Known now as medical/nursing tasks, these skilled activities include: • giving injections, • providing tube feedings, • managing catheter and colostomy care, and • many other complex care responsibilities. On average, caregivers spend 24.4 hours a week providing care to their loved one. Nearly one-quarter provide 41 or more hours of care a week (23%). Caregiving is particularly time-intensive for those caring for a spouse/partner (44.6 hours a week). Caregivers would benefit if the following issues were identified and addressed: 1. Identify high-risk caregivers. 2. Support caregivers in the workplace. 3. Provide resources to new caregivers. 4. Offer training. 5. Encourage advance planning for when caregivers can no longer provide care. There are two reasons for the rapid rise in caregivers. Baby boomers are aging and that causes a stress on the programs and personnel required to meet the needs of those who are aging and needing more care. Those same baby boomers are living longer and want to stay in their own homes preferring also to die in familiar surroundings. Support and training would help alleviate some of the stress of caregivers and help to make their care better. Conversations to plan in advance for when care can no longer be provided by family and friends would alleviate some of the difficulties facing caregivers and their family members needing care. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Resolutions

Tuesday, 29 December 2015 by Erin McAllister, Paralegal

Yes, it is that time of year. Everyone has had their fill of Christmas cookies, egg nog and candy canes. We are looking forward to a new year which brings the hope of new beginnings. Maybe you want to be thinner, smarter, punctual or nicotine free. The question then becomes why so many New Year’s resolutions are broken before January turns to February. According to the Statistic Brain Research Institute 45% of Americans usually make New Year’s resolutions and by June, 54% have abandoned their attempts. 39% of people in their twenties achieve their resolution each year and only 14% of people over 50 are able to achieve their resolution. The top ten New Year’s resolutions for last year were: 1 Lose Weight 2 Getting Organized 3 Spend Less, Save More 4 Enjoy Life to the Fullest 5 Staying Fit and Healthy 6 Learn Something Exciting 7 Quit Smoking 8 Help Others in Their Dreams 9 Fall in Love 10 Spend More Time with Family Having all the aforementioned evidence, people who explicitly make resolutions are 10 times more likely to attain their goals than people who don’t. How do you become one of the successful people when it comes to resolutions? Statistics tell us that in this case, less is more. People are more successful if they set one clear goal. It also helps if the goal has benchmarks that can be measured and observed. Deliberately design your life so that you are more likely to succeed and not just relying on willpower alone. That means making realistic and attainable goals, publicly declaring them so that others will encourage and help you and then reward yourself for your successes. Brain scientists Antonio Damasio, Joseph LeDoux, and psychotherapist Stephen Hayes have discovered, through the use of MRIs, that habitual behavior is created by thinking patterns that create neural pathways and memories, which become the default basis for your behavior when you're faced with a choice or decision. Trying to change that default thinking by "not trying to do it," in effect just strengthens it. Change requires creating new neural pathways from new thinking. They also discovered that will power is like any other muscle. It has a finite strength and cannot be relied on to carry you indefinitely. It is important to remember that the New Year isn’t meant to serve as a catalyst for sweeping character changes. It is a time for people to reflect on their past year’s behavior and promise to make positive lifestyle changes. “Setting small, attainable goals throughout the year, instead of a singular, overwhelming goal on January 1 can help you reach whatever it is you strive for,” says psychologist Lynn Bufka, PhD. “Remember, it is not the extent of the change that matters, but rather the act of recognizing that lifestyle change is important and working toward it, one step at a time.” Looking for help is another aid in accomplishing your goal. Consider finding an accountability buddy or workout buddy. Support groups may also help as you surround yourself with people having the same struggle during this time of change. Being part of a group makes it easier to be consistent. To be successful with your 2016 New Year’s resolutions, try setting one specific goal. Losing weight is not a specific goal. Losing 10 pounds in 3 months is. Make the goal measurable in small increments. If running a marathon is your goal for 2016, you could begin by running 5k’s, mini marathons and other smaller races to lead up to the marathon. Be realistic with the change that you are pursuing and choose finite times to mark your progress. Finally, set a reward for yourself when the goal is achieved. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Planning for Families With Special Needs

Wednesday, 23 December 2015 by Brendan Bybee, JD MPA

The estate planning process presents unique challenges for families who must consider how to provide an inheritance for individuals who rely upon governmental benefits to provide for medical assistance and other needs. Outright gifts to a disabled individual, or payments made directly for his or her care and support can effect eligibility for benefits such as SSI and Medicaid. The same risk is present if an inheritance from an estate or a personal injury award is distributed outright to the disabled beneficiary. For many individuals, however, especially parents of disabled sons and daughters, the idea of disinheriting a child in order to preserve government assistance or other benefits is an unacceptable alternative. Planning for the disabled requires considering sophisticated estate planning strategies that preserve access to medical assistance and other important benefits. Supplemental or special needs trusts provide a solution. WHAT IS A SUPPLEMENTAL OR SPECIAL NEEDS TRUST? A Supplemental Needs Trust (or “SNT”) is a discretionary trust that can be created during your lifetime or through the provisions of your revocable living trust or will. The trustee of the SNT is empowered to use the trust property only for purposes that do not overlap with the intent and provision of public assistance programs. Trust property is available for the purchase of supplemental items not otherwise provided by and paid for by public funds such as Medicaid and SSI. The trustee can use trust funds to pay for such things as travel, recreation, training programs, education, rehabilitation, computers and medical services not otherwise provided through participation in government programs. Funds flowing from an SNT can be used to make life richer, and more comfortable for the person with special needs. UTILIZING THE SUPPLEMENTAL NEEDS TRUST A properly drafted SNT clearly states your intent that the trust property will only be used to supplement, and not to supplant, public benefits. These specially designed trusts are afforded protected status under state and federal law and, as such, they will not be considered property of the beneficiary. Although SNTs can be established with assets of the beneficiary, under some circumstances, an SNT established for a loved one with your assets will never be subject to Medicaid recovery (payback) and can be distributed to beneficiaries of your choosing after the primary beneficiary passes away. Implementing strategic use of an SNT in your estate plan can ensure that the inheritance you leave your disabled loved one will not interfere with their much needed benefits and that any remainder is left to bless others. If you are an individual with a disability who currently has or is expecting to receive a sum of money or stream of income, or if you are a friend or family member of a disabled individual who is contemplating making a gift for that individual’s benefit, please do not hesitate to contact us for a free consultation to discuss how you can use a properly drafted supplemental needs trust to make that gift go further. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Filing a Trademark Registration Application

Thursday, 17 December 2015 by Seth Gomm, JD MBA

There are clear advantages to federal trademark registration. If a trademark is granted, it provides a presumption and notice of nationwide use. If you were ever to become involved in a trademark infringement dispute, possessing federal registration provides initial evidence of a valid trademark. Federal registration would also enable you to seek better statutory remedies against infringers under the Lanham Act. To file a trademark application, you will need to provide the following information: • The name and contact information of the entity or person to whom the mark should be registered. • A depiction of the mark (this includes the words for a standard character mark and a copy of the logo for a design mark). • A description of the goods or services on or in connection with which the mark is used. • The date on which the mark was first used in commerce. • A specimen, or picture, of the mark as it appears on merchandise or services that are used in commerce. • The intended international class(s) that you are seeking protection with regard to the mark. There are, of course, costs to seeking federal registration. First, the fee for filing a registration application with the Patent and Trademark Office (PTO) begins at $225 to $325 per international class, if filed electronically. This is in addition to attorneys’ fees to initially prepare the registration application and the cost of performing a third-party trademark search, if desired, for each mark. There could be additional attorneys’ fees and PTO costs incurred depending upon the actions the PTO takes in evaluating the application. The current average timeframe for registration of a mark is about nine to eighteen months; however, if there are any additional PTO actions or challenges, that timeframe would be extended. There are also additional fees and costs associated with maintaining and enforcing the marks. There is also no guarantee that you will be successful in obtaining federal protection of any of the marks. For instance, the PTO could make findings during the process that could bar registration. This could include a finding of a likelihood of confusion between your trademark and another already registered trademark, or a finding that another trademark owner has priority of use of the mark and is therefore entitled to the mark. ADDITIONAL RECOMMENDATIONS • Once you start using use your marks in commerce, records and samples of the use (including the dates of use) of any marks should be saved in a database. These records will be useful when a specimen is required, or to maintain or enforce trademark rights in the future. For goods, “use in commerce” means that the trademark must appear on the goods, the container for the goods, or displays associated with the goods, and the goods must be sold or transported in commerce. For services, the service mark must be used or displayed in the sale or advertising of the services, and the services must be rendered in commerce. • The marks to be registered must be used consistently (i.e., there should be no variation in the words or design). • The notation “TM” or “SM” should be used to designate any marks until they are registered. Federal registration (and only federal registration) grants the right to use the distinctive circled “R” symbol. • You should consider registration at the state level. The primary benefit of registering at the state level is that it takes substantially less time to go through the application process (the application itself is also more basic than a federal application). However, it does not afford the same protection as a federally registered mark and should not be considered in lieu of federal registration. State trademark registration mainly serves a notice function and offers limited protections. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

The Learning Curve

Wednesday, 16 December 2015 by Staff, Spaulding Law

Most of us have experienced a difficult learning curve at some point in our life. You find a really great opportunity so you decide to jump. You leave behind everything that is comfortable and routine and step (even if only somewhat) into the unknown. It’s a great feeling until the learning curve comes and smacks you in the face. Suddenly you feel like you have no idea what you are doing. You, the person who was competent, confident and reliable now vulnerable and unsure. It’s an unnerving feeling. So, how can somebody who is hoping to take advantage of great new opportunities deal with the learning curve in a way that allows them to build the confidence they once had? Accept that you will make mistakes. Employers know and understand that mistakes are a part of the learning process. Even those who have been with a company for years occasionally make a mistake. Understanding and accepting that occasional mistakes will happen allows you to learn and move on rather than dwelling on it and undermining your confidence. Ask questions. This can be incredibly uncomfortable for those who have grown accustomed to operating independently. However, taking the opportunity to clarify basic definitions and terminology along with a broad understanding of the task can help you make connections much quicker than trying to figure things out on your own. Communicating a knowledge gap can also save you the embarrassment of making a mistake that might have been avoided with a little bit of clarification. Repetition and reinforcement is key. People quickly learn things that they do repeatedly and an increase in the number of correct answers you give versus incorrect answers will boost your confidence and increase performance. This is easier in a situation where you are performing the same functions over and over again, but how does one get the benefits of this principle when their opportunities to practice something are spread out? One answer may be to take detailed notes related to each task. These notes can be reviewed regularly and you will feel more familiar with the task when the opportunity to perform it again arises. The learning curve will always be accompanied with some level of discomfort. However, if you can learn to deal with the discomfort, just think of all of the possibilities that will open up for you. There is a whole group of people who let that discomfort stop them from trying something new. You will have a competitive edge if you can learn to productively deal with the learning curve and embrace those experiences. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Tradition

Monday, 14 December 2015 by Erin McAllister, Paralegal

“Because of our traditions, we’ve kept our balance for many, many years…… You may ask, how did this tradition get started? I’ll tell you. I don’t know. But it’s a tradition and because of our traditions, everyone of us knows who he is and what God expects him to do. Without our traditions our lives would be as shaky as… as… as a fiddler on the roof.” Tevye in The Fiddler on the Roof. A tradition is a belief or behavior passed down within a group or society with symbolic meaning or special significance with origins in the past. Common examples include holiday traditions we see this time of year. Many European countries celebrate Christmas Advent with either an Advent wreath, calendar or candle. Advent wreaths have four candles attached to a wreath and the tradition is to begin four Sundays before Christmas and light the first candle. The next Sunday two candles are lit until the Sunday before Christmas all the candles are lit. Advent calendars have a pocket to open each day in December culminating on the 25th. Chocolates or trinkets are put inside each pocket. The Advent Candle has the dates written on the side and the candle is burned each day to mark the coming of the 25th of December. St. Nicholas visits children in several European countries on December 6th. Children shine their shoes and put them out by the door. The legend is that St. Nicholas comes by and if the children have been good, they receive candy in their shoes. St. Lucia is celebrated on December 13th. Lucia wears “lights in her hair” to bring light to the long winter nights in Sweden. In remembrance, girls dress in white and wear lighted wreaths in their hair. The Lucia tradition is traced back to St. Lucia of Syracuse, martyr who died in 304, and to a Swedish legend that Lucia was Adam’s first wife. It is believed that she consorted with the devil. Lucia Night was the longest night of the year. This night was considered dangerous because supernatural beings were out and animals could speak. By morning the livestock needed extra feed. People were urged to eat seven to nine breakfasts. The last person to wake up was nicknamed ‘Lusse the Louse’ and given a playful beating. The following is the song for Lucia: The night treads heavily around yards and dwellings In places unreached by sun, the shadows brood Into our dark house she comes, bearing lighted candles, Saint Lucia, Saint Lucia. Santa Lucia is celebrated in the Scandinavian countries as well as some European countries like Switzerland, Italy and France. Many countries now celebrate the 25th of December and Santa Clause. Here are some names for Santa throughout the world: Brazil – Papai Noel China – Sheng dan lao ren Costa Rica – Nino Dios Argentina - Colacho Denmark - Julemanden Egypt - Baba Noel Ethiopia - Yagena Abat France – Pere Noel Armenia - Gaghant Baba Georgia – Tovlis Papa Vietnam - Ong Gia Noel Ukraine - Svgatyi Mykolai Germany - Weihnachtsman Indonesia - Sinterklass Hong Kong - Sing Daan Lou Yan Haiti - Jwaye Nowe Kwanzaa is celebrated from December 26th to January 1st. It is a week-long celebration started by Maulana Karenga, professor of African Studies in 1966. It is meant to honor African heritage and has seven core principles: 1. Umoja (Unity) 2. Kujichagulia (Self-Determination) 3. Ujima (Collective Work and Responsibility) 4. Ujamaa (Cooperative Economics) 5. Nia (Purpose) 6. Kuumba (Creativity) 7. Imani (Faith) Families decorate their houses in African art, colorful cloth (kente) and women wear kaftans. They may have ceremonies which include drumming, musical selections and reading of the African Pledge. Epiphany is celebrated throughout the world on January 6th. It is the tradition of celebrating the Three Wise Men who traveled to Jerusalem to see the Christ Child. Epiphany traditions range from religious observances to celebrations with much eating and partying. In America, the holiday season is celebrated with parties, outside decorations, life-size nativities, gingerbread houses and gift giving. Christmas caroling, ice skating and sledding or tubing are also popular when there is snow. Holiday traditions throughout the world seem to center on family; experiences and activities that foster connection, peace, love and unity. Families and communities take time at the end of the year to connect and express good wishes. Families have special dinners, neighbors share goodies or Christmas cards all in an attempt to connect. Author, Susan Lieberman has noted: “Family traditions counter alienation and confusion. They help us define who we are; they provide something steady, reliable and safe in a confusing world.” Perhaps Tevye was right. Our traditions tell us who we are and what we should be doing and give us balance in a shaky world. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Gifts and Taxes

Wednesday, 2 December 2015 by Brendan Bybee, JD MPA

As we grow from childhood into adulthood, the holidays become less about what we get and more about what we give. This tradition of ending the year on a generous note is an expression of our best selves and it can be intoxicating. We may find ourselves spending more than we planned when we stumble upon the “perfect thing” for someone close to us. It is true that the thought is what really matters, however, service to this principle often requires that we eschew too much scrutiny of price tags. Generosity is good for the soul and too much concern for prices can cheapen even the most expensive gifts. However, if you have been particularly generous this year, you may need to discuss the tax implications with your trusted advisors. As with other transfers of property, the federal government imposes a tax on gifts (defined as any transfer for which you receive anything less than fair market value in return). The gift tax is levied on the cumulative value of gifts given by you to a particular individual in a given calendar year. Most people are unaware of the gift tax but, then, most will never need to pay it. First of all, the first $14,000.00 (current through 2016 and subject to future adjustment for inflation) you gift to any individual is excluded from the tax. Secondly, direct payments for school tuition or medical care made on another’s behalf are exempt from the gift tax. Finally, each person can use their available estate tax exemption (currently $5.43 million and subject to adjustment annually for inflation) to cover any unpaid gift tax. It is possible, therefore, to be very generous without ever having a gift tax issue. Gift tax returns (on IRS Form 709), like income taxes, are due annually but there is no penalty for failure to file on time if no gift tax is due. Under the circumstances, it may be tempting to disregard the gift tax and forgo preparation of a return until the need later appears. However, recording and reporting your significant gifts to the IRS is essential for simplifying administration of your estate and maximizing your ability to pass on wealth to your descendants for the following reasons: 1. The IRS has three years from the date of filing your gift tax return to assess your gift tax, whether the filing is timely or late. Although you can file at any time before the IRS initiates an assessment or collection proceeding, filing on time is advantageous because it starts the clock running against the IRS. It is important to be ahead of the IRS, especially if the value of the gift is subject to dispute (such as a gift of a partial interest in property). If you fail to take the lead, the IRS may do so after your death, complicating things for your loved ones. 2. If you intend to leave a family legacy, distributing your wealth to succeeding generations, you need to make the most of your Generation Skipping Transfer (GST) tax exemption (a topic we will address more fully in a future blog post). It is common to allocate GST exemption to annual gifts to irrevocable trusts. Unless the gift is subject to IRS automatic GST allocation, the value of your exemption will be determined at the time of filing your gift tax return. If the gift has since appreciated, you will have forever lost some portion of your exemption potential. Taxes don’t have to spoil the fun of giving gifts and blessing others. If you are feeling generous this year, please sit down with us and we’ll help you make the most of your giving. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Software Escrow Accounts

Tuesday, 1 December 2015 by Staff, Spaulding Law

Let’s imagine your company just spent a huge portion of its budget on a customized software from SoftWidget, an imaginary software provider. What would your company do with the software if SoftWidget decided it would no longer support it or went out of business? After all, the software industry is volatile (where did you go WordPerfect????). To address this issue, many software contracts include provisions for the creation of “software escrow accounts” which provide that a third party will retain a copy of the software code. The code is only released under a specified set of conditions. Two types of code can be saved in a software escrow account: source code and object code. Source code is human readable code. This means that you do not need the assistance of a computer to understand the code. Think of it as a user’s manual to manipulate the machine readable code. If worse came to worse, you could maintain or support your users in-house with the proper personnel as long as you had the source code. Source code is commonly placed in a software escrow account. Object code, on the other hand, is not user friendly. It is readable only by a machine. Because we don’t understand it, the source code acts as a sort of “cipher” to understand the object code. Additionally, the source code allows the manipulation and alteration of the object code. Customers usually receive only the object code when they purchase the software. They can use it, but they can’t change it. Object code has traditionally not been deposited in a software escrow account because customers already had the software locally installed on their own servers and were not dependent upon a third party. Thus, for most users, the object code need not be placed in an escrow account. Software escrows become more complicated however, if you are purchasing a service as a software (“SaaS”) product. In this scenario, you do not actually receive the object code when you purchase the software. Instead, this code is located on the software provider’s servers and made available through the cloud. If the software provider were to suddenly go out of business and you qualify to receive code from the escrow account, it may do you no good if they have only stored source code, as this only provides instructions on how manipulate code you do not possess. Thus, in a SaaS scenario, a user would want both the source code and the object code placed into the software escrow account. An additional consideration with SaaS escrows is the recovery of data. Escrows typically contain basic source code without any customer specific information. If your data is stored in the cloud (the software provider’s servers) it may be lost in an escrow qualifying event. You may want to consider requesting regular backups of your information to store on local servers as a safeguard against such an incident. Before you agree to a company’s standard software escrow clause, verify which type(s) of code they are required to deposit, review the conditions that would qualify for a release of the code held in escrow, and consider the access you will have to your data in such an event. A solid understanding of these issues can help you have confidence in purchasing your next software system. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Gratitude

Wednesday, 25 November 2015 by Erin McAllister, Paralegal

Thanksgiving is the beginning of what is commonly known as the “Holiday Season”. It might seem fitting that the beginning of the holiday season is a day that was set aside to express gratitude. This year, how many of us will take a moment to show gratitude or reflect on where we are in life and what we have, before digging into the turkey, mashed potatoes and pumpkin pie? The first Thanksgiving took place after nearly half the pilgrims died from a catastrophic year. It became a national holiday in 1863 in the middle of the Civil War and was moved to its current date in the 1930s following the Depression. Perhaps it was easier for the people who came before us to take a moment and reflect on their gifts and bounties. Maybe it was easier for them to see and express gratitude than it is for us. But it is precisely because showing gratitude is a difficult thing for us to do, that we should make every effort to express the gratitude we feel. A wise man once said that “gratitude is a description of a successful mode of living. The thankful heart opens our eyes to a multitude of blessings that continually surround us.” The word gratitude is derived from the Latin word gratia, which means grace, graciousness, or gratefulness. In some ways gratitude encompasses all of these meanings. Gratitude is a thankful appreciation for what an individual receives, whether tangible or intangible. With gratitude, people acknowledge the goodness in their lives. In the process, people usually recognize that the source of that goodness lies at least partially outside themselves. As a result, gratitude also helps people connect to something larger than themselves as individuals — whether to other people, nature, or a higher power. In positive psychology research, gratitude is strongly and consistently associated with greater happiness. Gratitude helps people feel more positive emotions, relish good experiences, improve their health, deal with adversity, and build strong relationships. Researchers have discovered that people who experience the most gratitude tend to: - Feel a sense of abundance in their lives - Appreciate the contributions of others to their well-being - Recognize and enjoy life's small pleasures - Acknowledge the importance of experiencing and expressing gratitude - Know how to cultivate an attitude of gratitude First of all, gratitude is good for you. Psychologically, it brings you optimism and life satisfaction. But beyond your mood, it’s also good for your body. Numerous studies have suggested that gratitude strengthens the immune system, lowers blood pressure, encourages you to exercise more and sleep better. Second, it improves your relationships when you see and appreciate how others contribute to your well-being. Gratitude is a way for people to appreciate what they have instead of always reaching for something new in the hopes it will make them happier, or thinking they can’t feel satisfied until every physical and material need is met. Gratitude helps people refocus on what they have instead of what they lack. Crisis can make us more grateful, but research says gratitude also helps us cope with crisis. Consciously cultivating an attitude of gratitude builds up a sort of psychological immune system that can cushion us when we fall. There is scientific evidence that grateful people are more resilient to stress, whether minor everyday hassles or major personal upheavals. The contrast between suffering and redemption serves as a tip for practicing gratitude: remember the bad. It works this way: Think of the worst times in your life, your sorrows, your losses, your sadness, and then remember that here you are, able to remember them, that you made it through the worst times of your life, you got through the trauma, you got through the trial, you endured the temptation, you’re making your way out of the dark. Remember the bad things, then look to see where you are now. How do you start to show gratitude and get some of the positive effects into your life? Try some of these suggestions: 1. Keep a gratitude journal. At the beginning or end of your day take a moment to reflect on the things that happened that you can be grateful for. 2. Remember where you came from and where you are going. 3. Ask three questions – - What have I received? - What have I given? - What troubles and difficulties have I caused? 4. Sometimes offer up a prayer of gratitude, no requests just gratitude for all you have. 5. Thank someone mentally. It may help just to think about someone who has done something nice for you, and mentally thank the individual. 6. Use visual reminders. Forgetfulness and a lack of mindful awareness are a problem for all of us. A beautiful picture, a pithy quote can help you to ground yourself in gratitude. 7. Meditate. Mindfulness meditation involves focusing on the present moment. Focus on what you’re grateful for. 8. Use language that fosters gratitude for others, your situation and what you can learn from it. As Melodie Beattie said: “Gratitude unlocks the fullness of life.” Being grateful is a simple expression that can make significant changes to your life in a variety of ways. It can bring you optimism and life satisfaction. You may reap physical rewards and recognize the connections you have with others, the world and a higher being. Gratitude can lead to living with more mindfulness and openness to all that awaits. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Taxonomy of Federal Trademark Protection

Wednesday, 25 November 2015 by Seth Gomm, JD MBA

Whether a trademark or service mark can be registered at the federal level, and the extent of protection that is given to a mark once it is registered, depends upon the “taxonomy” of the mark. The stronger the mark, the more likely it is that it will receive protection. A brief summary of common trademark classifications is as follows: • Generic mark – a word by which something is commonly called (e.g., clothes or aspirin or cellophane). These cannot be registered. • Descriptive mark – a mark that conveys an immediate idea of the ingredients, qualities, or characteristics of a good or service (e.g., Vision Center for a business offering optical goods and services). Descriptive terms may be registrable (if secondary meaning is shown) but are usually afforded a narrow scope of exclusivity and are generally considered to be weak marks. • Suggestive mark – a mark which requires thought, imagination, and perception to reach a conclusion as to the nature of goods or services it designates (e.g., Coppertone for sunscreen). A suggestive mark is registrable and its scope of protection depends upon the uniqueness the mark achieves through use in commerce. • Arbitrary mark – a mark that uses words in an arbitrary way, and where there is no association between the words used and the goods or services they designate (e.g., Apple for a computer). These marks receive a broad scope of protection. • Coined or Fanciful mark – a mark that has been created or fabricated, and is meaningless aside from the product or service is designates (e.g., Kodak for film). A coined or fanciful mark receives the strongest form of trademark protection. Trademark applicants must also be aware if their mark is “confusingly similar.” Under the Lanham Act, the USPTO may deny registration of a mark if it is “confusingly similar” to another mark used in commerce. This is often a subjective determination made by the USPTO examiner. In addition, a holder of an existing mark (whether or not it is registered) may seek to oppose the registration of a confusingly similar mark. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Asset Protection Planning – Part 1

Wednesday, 25 November 2015 by Ricky Nelson, JD

Asset protection planning is creating and implementing a plan using various tried and true tools to protect your hard earned assets. Assets include your home, a rental you have to supplement your income, the building your business operates out of, the equipment your business owns, or anything else of value. Asset protection is very important because, as you may already know, the United States is commonly known as the most litigious country in the world (this means that people here sue each other more than anywhere else). You have all heard of many stories of frivolous lawsuits where the person suing actually won. There are also many cases where the lawsuit was legitimate, but the person being sued lost everything—including their home. What can you do to protect yourself and your assets? Because asset protection (sometimes referred to as creditor-debtor law) is extremely complex area of the law, your asset protection plan should be specifically tailored to your circumstances. If you come across someone trying to sell you a “one-size-fits-all” or “guaranteed to protect your assets” solution to asset protection—be very cautious before implementing that plan. When choosing an attorney to assist you with protecting your assets be sure that the attorney is primarily an estate planning attorney with experience in asset protection. This is very important because there are several steps that the law requires when using specific asset protection tools that many “asset protection” attorneys are ignorant of. Here at Spaulding Law, we use a defense-in-depth strategy that is specifically tailored for your assets and liability risks. Defense-in-depth means using multiple tools so that when someone sues you, they have to cross multiple hurdles in order to get to your assets. Each “hurdle” by itself is a very formidable tool, but when taken together, it is very difficult for the person that sued you to overcome. Asset protection planning is not just setting up a limited liability company (in any jurisdiction) nor is it just an asset protection trust. It is a combination of different tools designed to overwhelm any attack on your assets. Is it bullet proof? No, however, it will be as bullet proof as we can legally make it, and someone will have to overcome many different obstacles. If you choose us for your asset protection needs you will have the peace of mind that you are looking for. The peace of mind that knowing that your house, business, and other assets are protected from creditors. Part 2 will be coming soon. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

What Gives Her (or Him) the Right to Create All Those Laws?

Tuesday, 17 November 2015 by Staff, Spaulding Law

One of the fascinating times of our American form of Government is our recently passed Election Day. I know those law signs are obnoxious. Even the politicians can’t wait until all the signs are taken down, the mailbox is once again relegated to commercial advertising--bereft of the last remnants of brochures with pictures of kids on laps and pretty-wives (or handsome-husbands) and the good old Red, White and Blue. All of that stopped the day after election Tuesday, like Christmas carols (and unfortunately, sometimes Christmas cheer) quickly fades the night after Christmas. However, unlike the Holidays, the significant part of Election Day is not what it means to us on Election Eve, but what it means to us afterwards, as everyday citizens of a community, or a school district, or a county, or a State and a nation feel the impact of elected officials on our daily lives. How is it—or rather what is it--that gives a woman or a man the right to submit his or her name on a ballot and, after election day, raise one arm, and swear an oath? What gives him or her, almost magically, the power to pass laws, or collect and spend someone else’s money, or to govern us? Some would say that it’s the Constitution, and they would have a good point. The Constitution, whether it is the State or Federal Constitution, is the rule book governing our society. The Constitution provides important checks and balances on the power of those we elect and authorizes them to act for us. Others would say that it’s the legislature (meaning the Congress, the State legislature or the City or County Council (or Commission) which gives people the right to create laws. They would have a good point too, since those bodies create, refine and specify the rules which govern us as allowed by the Constitution. However, what really gives the person elected in November the right to do what he or she ultimately does for us and in our place is US! Yes, you and me, as citizens. When we as citizens exercise our right to vote, we collectively determine and appoint which of those who offer themselves as candidates are authorized to stand in our shoes and do the work, get educated, listen to us, and pass laws, decide how much of our money to take from us, and how to spend it, and make the rules that will govern us. The United States is a representative constitutional Republic, and we empower those elected to represent us! So just what is the power we give to those we elect on Election Day? Well, for a teenager, those elected decide the age and process for the ability to drive a car on a public road. A few years ago, the State legislature decided to add a requirement to the driver license application that a minor driver could not qualify for a license without first driving for a minimum of 40 hours and that new drivers could not drive their friends (with a few exceptions). To teens and their parents, those decisions have a real impact. Municipal voters elect representatives of the City Council who determine the funds provided to a police department, or a fire department, or the condition of roads. If you like 4th of July festivities, city Holiday lights and festivities, or if you have issues with the taste of the water, trash collection services, or if you want a strong planning commission so that a strip mall is not constructed in a residential neighborhood, you should pay attention to the candidates for city offices, like the mayor and the city council, because they are given power by you. All residents of the State vote on a member of their legislative district to serve in the House of Representatives. Today, each elected member (there are 75 total) represents approximately 40,000 residents. These Representatives (together with the State Senate) vote to authorize the collection and spending of more than $10 billion annually in taxes from Utahans. They appropriate money to school districts for teacher salaries and other resources. Some complain that Utah dedicates fewer State dollars per student than any other State in America, however, most do not understand that under the law, every single dollar raised through income tax in Utah goes to education. Your State Representative (and Senator) also pass laws on what will be a crime, what your tax rate will be, and how many Highway Patrol officers are available to police the Highways. Truly, as a newly elected Representative, Councilman or even Senator or Governor raises his or her hand following the election, the reason they have power to act is because of You and Me, or rather, We—“We the People.” That is the significance of Election Day, and that is the beauty of our republican form of government in America. As lawyers, it is our job to help people navigate those laws and we feel privileged to do so. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Using Donor Advised Funds to Share the Giving and the Gift

Wednesday, 11 November 2015 by Brendan Bybee, JD MPA

As the holiday season hits high gear, you may find yourself reflecting on the year now passing, contemplating your expectations, goals, and hopes for the year, spoken and unspoken. As you do, you will declare some successes and perhaps some failures. Some of these will be financial, some personal, some relational. While your family relationships are among the most important considerations, financial matters can often take precedence because the effects are so tangible and immediate. It is important, therefore, to recognize opportunities to meet your most important needs while serving the most expedient. As you anticipate the gifts you will be giving and receiving this season, your CPA may be very anxious to ensure you avoid leaving anything under the tree (menorah, etc.) for the Government. This may involve making last minute gifts to your favorite charities in order to maximize your tax deductions. This is a wonderful way to bless others while blessing yourself. What you may not have considered is that you can bless your family by including them in your giving. Donor Advised Funds (DAFs) present a wonderful way to include your loved ones in your philanthropic activity. DAFs are established by you, as a donor, and held by an established 501(c)(3) non-profit organization. The donation is recognized immediately as a charitable gift for tax purposes, however, the funds can be held for later distribution as directed by you and your family. DAFs can be established with only a few thousand dollars and can continue to receive additional donations over the years. DAF’s can also receive gifts from your will or trust upon your death. Depending on the institution holding the DAF you may even be able to appoint your own financial advisor to manage the investment of the fund and see your giving power grow. The opportunity to receive an immediate tax deduction while retaining the funds for later distribution presents myriad possibilities to work together with your family in blessing each other as you give to others. The practice of philanthropy has a number of benefits particular to those who participate in the giving, such as increased feelings of gratitude, greater health and happiness, and increased compassion for others. By sharing your giving with loved ones you share in these blessings and create new occasions for family connection, meeting your most important goals while satisfying your most expedient concerns. If you are interested in establishing a habit of giving within your family, come talk to us at Spaulding Law. We can help you make philanthropy a part of your plan and put you in touch with people and organizations that can help you give in ways that bless your family as well as the wider world around them. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Trademarks, Service Marks and Adequate Specimen

Friday, 6 November 2015 by Seth Gomm, JD MBA

The Lanham Act [1] governs trademarks in the United States and affords nationwide protection against infringement for marks registered on the Principal Register [2]. The USPTO is responsible for administering the registration of trademarks. In order to receive protection, the mark must be used in commerce, associated with a particular class of goods or services, distinctive, and not be confusingly similar to any other registered mark. A specimen (or sample) of the mark in use must be submitted with the application. Two different types of marks may be registered with the USPTO: • A trademark is a word, phrase, symbol, or design, or a combination of words, symbols or designs, that identifies and distinguishes the sources of goods of one party from those of others. o For trademarks, a proper specimen shows the mark on the actual goods or packaging for the goods (such as tags, labels, a container for the goods, a display associated with the goods or a photograph of the goods that shows use of the mark on the goods). Invoices, announcements, order forms, bills of lading, leaflets, brochures, publicity releases, letterhead and business cards generally are not acceptable specimens for goods. • A service mark is the same as a trademark, except that it identifies the source of a service rather than a product. The following criteria have evolved for determining what constitutes a service: (1) a service must be a real activity; (2) a service must be performed to the order of, or for the benefit of, someone other than the applicant; and (3) the activity performed must be qualitatively different from anything necessarily done in connection with the sale of the applicant’s goods or the performance of another service. o For service marks, a specimen for a mark must show the mark used in the sale or advertising for the services (such as a sign; a brochure about the services; an advertisement for the services; a business card or stationery showing the mark in connection with the services; or a photograph showing the mark as used in rendering or advertising the services). There must be some reference to the type of services rendered on the specimen, i.e., not just a display of the mark itself. For example, if the mark sought to be registered is “XYZ,” a business card that only shows the mark “XYZ” would not be acceptable. A business card that states “XYZ REAL ESTATE” would be acceptable. A trade name is the name of the business – it cannot be registered with the USPTO. A standard character mark is a word or phrase that is used in plain block letters. Registration of the mark in plain block letters focuses on the mark as a word or phrase, and it encompasses all reasonable presentations (including designs) in which it could be depicted. A stylized character mark is a word or phrase which uses distinctive lettering; a symbol; a design; or a combination thereof (like a logo). Notably, the same word may be used as a trademark, a service mark and a trade name. For example, Xerox is the trade name of a company. When used to designate its copiers, it is a trademark. When used to designate its copying service, it is a service mark. When a trademark or service mark is federally registered, it is proper to use the encircled ® symbol. It is desirable to use the symbol at least once on each label, tag or box bearing a federally registered mark, provided that the mark is being used to designate goods or services encompassed by the registration. At all other times it is proper (but not mandatory) to use a TM symbol to designate a trademark, and a SM symbol to designate a service mark. It is not necessary to use any symbol to designate a trade name. [1]15 U.S.C. § 1051 et. seq. [2]The registration on the Principal Register affords the most protection under federal trademark law. However, if a mark is not inherently distinctive or is merely descriptive and has yet to acquire a secondary meaning, the mark may be registered on the “Supplemental Register” as opposed to the Principal Register. Registration on the Supplemental Register allows a registrant to bring an infringement action in federal court and provides protection for the mark against subsequently-filed application for a similar mark. In addition, the registrant can subsequently apply to have the mark registered on the Principal Register by showing that the mark has acquired a “secondary meaning” - usually after the mark has been in use for five years. Notably, there is no “intent to use” application for registration on the Supplemental Register. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Legal Considerations When Purchasing Software

Friday, 6 November 2015 by Staff, Spaulding Law

We live in an increasingly technological world, and the terms of the technology are constantly changing. While many software companies have click-through agreements, if you have the opportunity to negotiate and sign an agreement, there are some basic things you should take into consideration: Is the software being offered as a license or a subscription? Licenses are often irrevocable (as long as you maintain compliance with the terms of the agreement), perpetual and royalty-free. Subscriptions are usually “right to use”. This means that you can only use the software for the term of the subscription. Many cloud or SaaS (Software as a Service) products are considered to be subscriptions. A license often includes a one-time fee with additional charges for maintenance and updates. A subscription usually involves an ongoing fee with the maintenance and updates included in the cost of the subscription. Most software systems are programmed to collect information about activity in the program, and sometimes specifically the end user (Personally Identifiable Information “PII”). This information allows the software company to refine their product, sell information to advertisers, personalize the experience of the user, and direct them to subjects or items that may be of interest to them. Examples of this can be found in the ads that show up in your Facebook feed, the shows recommended through your Netflix account, products recommended on your Amazon account, etc. It is important to know if the software you are using will collect this kind of information. If the software you are planning to use does collect PII, what kind of protections does the provider offer? It is likely that the provider offers only an industry standard duty to protect that information. This standard may vary by industry and it is recommended that you research this standard before accepting a clause with this language. If you are looking for specific language about what may be involved in protecting your information, there are several security certifications available to software companies (such as ISO 27001) that you may be able to request be included in your agreement. The provider will likely make several guarantees in the agreement with respect to warranties, indemnification, etc. It is important to be aware that they also often include a limitation of their liability. This means that any damages you can potentially claim under the agreement may be limited by this limitation. It is recommended that you assess your risk to determine if the limitation of liability is sufficient to cover your needs. The above are just a few of the issues to consider when signing a software agreement. A licensed attorney, specifically an attorney familiar with software and licensing, can help a customer navigate the many other potential issues in such an agreement. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Dual Sovereignty

Wednesday, 28 October 2015 by Staff, Spaulding Law

“The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.” Thus reads the Tenth Amendment to the United States Constitution, which is enumerated in the Bill of Rights. But just why was such language included and what does it really mean? We’ve all heard of the Fox TV series “Are You Smarter Than a 5th Grader” which was hosted by Jeff Foxworthy. Here is a question that stumps even most 5th Graders. The question is: According to the United States Constitution, which is more powerful in America, the Federal Government or the State Government? Not surprisingly, most believe the correct answer is the Federal Government. After all, the Federal Government has the FBI, the IRS and the US Marines. The Federal Government has the White House, the Capitol, the United States Supreme Court and the Lincoln Memorial. The Federal Government has Congress, the Library of Congress and Arlington National Cemetery. On the other side of the coin, proponents of the principles of “federalism” argue that States came first, and the Federal Government is a creature of the Philadelphia Convention, which was convened by representatives of the Thirteen Colonies. Such proponents maintain that States are sovereign, all-supreme and should be given due deference by the Federal Government. So what is the correct answer to the 5th grade stumping question? Which of the two governments is most powerful and who is right and who is wrong? And the correct answer is (drumroll please)…IT DEPENDS. It really depends on the circumstances and there are many circumstances where the Federal Government has zero jurisdiction over the people. Therefore, for all 5th Graders and anyone else who is interested (which should be every single US Citizen), the government most powerful between the State and the Federal depends entirely upon which power is at issue. And that is one of the ingenious, miraculous and powerful principles of the United States Constitution—the principle of Dual Sovereignty. Dual Sovereignty? Sovereignty means absolute power and control. So, how can both the individual states and the Federal Government reside in the same country or system and both be sovereign at the same time? How this happens can be described by the following fictional metaphor. Two people living together in the same household could be considered dual sovereigns in their home. For example, one person could be considered the absolute ruler in a very small area of their property—say the garage and the storage shed. The other person, on the other hand, could be the ruler over everything else, namely the living room, the kitchen, bedrooms, and basically everything but the garage and the storage shed. Thus, indeed, these are dual sovereigns residing in the same home, just in different and predesignated areas! It is the same with America. The framers of our Constitution (which is our government and freedom rulebook) determined, after extensive debate and thought, to limit the sovereignty or power of the Federal Government to those areas of the (house of) Government specifically designated in the Constitution and, as indicated in the statement above, the 10th Amendment states that all other “powers not delegated to the United States” are “reserved to the States respectively, or to the people.” Accordingly, when we are dealing with matters of national defense, the Federal Government is in charge. It is the same with coining money, the United States military, international relations, funding government through taxing powers or the most potentially far-reaching power—regulating interstate commerce. In those important but specifically enumerated and limited areas, the Federal Government is supreme and sovereign. However, as the American people, we cannot ever forget that in the areas of the (house of) Government not expressly and specifically delegated to the United States, the States are and should remain Supreme and even more powerful than Washington DC. This principal is called “Dual Sovereignty” and it is something that every American 5th Grader, and every other American, should understand and fight to defend. If we allow the Federal Government to go unchecked, we will lose the very dual sovereignty our Founding Fathers knew was essential to a free America. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Intuition and Advocacy: More than Laws & Facts

Wednesday, 28 October 2015 by Brady Brammer, JD MPA

In discussing the process of litigation, the rhetorical toolbox is oftentimes (and artificially) confined to two tools: (1) the law and (2) the facts. One of the first things taught to law students is that we must effectively understand the law and exhaustively apply the facts to the law. In fact, it is this skill that is taught most vigorously during the first year of law school with acronyms to guide (or force) writing structures like IRAC (Issue, Rule [or law], Application, and Conclusion). In fact, most law school tests are created in a way that emphasizes this format of thinking. This methodology is so ingrained in most attorneys’ thought process that it can be fairly said to encompass the idea of what it means to “think like a lawyer.” Most court decisions, legal briefs and legal arguments follow the IRAC method. It is so ingrained, that most attorneys can identify authors and presenters with legal training by recognizing this format of thinking. However, the truth is that the law and its analysis is much messier than a four letter acronym. Judges, attorneys, witnesses and the public are influenced by more than just the law and a well-reasoned application of the facts to the law. In addition to the law, professional standards and general ethical standards influence rulings that may be legal in the strictest sense, but may violate industry standard or generally accepted ethical behavior. More importantly, the law, at least most civil laws, permit consideration of extra-legal considerations by asking fact finders to consider whether behavior is “reasonable” as opposed to legal. Thus, the “Rule” aspect of legal rhetoric is generally broader than just the statutes and case law of the past. Rather, it looks more like this: At its core, every lawsuit involves an ethical dilemma. Thus, there is inherently a “judgment” that must take place as to the resolution. While the reasoning behind a judgment is important, so too is the intuition of the judgment. In other words, the primary reaction, the gut reaction, the “is it fair”, the “is it right” factor is a huge part of the judgment process. When confronted with an ethical dilemma, humans will develop evaluative feelings (gut reactions) on complicated issues within 200 to 250 milliseconds. (JJA Van Berkum, t. 2009. Right or wrong? The Brain’s Fast Response to Morally Objectionable Statements. Psychological Science, 20:1092-1099) Thus, we must assume that as soon as we frame the issue, a judge, a jury, or a witness is forming an intuitive reaction within a quarter of a second. A quarter of a second! This happens at the issue stage of the legal IRAC analysis. It happens before the law, before the application of facts and before we conclude. The point of this post is not to criticize the IRAC methodology. Rather, it is to provide a reminder that all persons in a judgment situation are influenced by more than an attorney’s well-reasoned arguments. Humans--all humans--are influenced by their base intuition. As we make arguments, identify issues and advocate, it is important that we remember that half of the equation, particularly when a judgment is on the line. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Halloween

Monday, 26 October 2015 by Erin McAllister, Paralegal

It is said that All Hallows' Eve is one of the nights when the veil between the worlds is thin. Whether you believe in such things or not, those roaming spirits probably believe in you. Even the air feels different on Halloween, crisp and bright. Evolving from the Celtic holiday, Samhain, modern Halloween has become less about literal ghosts and more about costumes and candy. The Celts used the day to mark the end of the harvest season and the beginning of winter. They also believed that this transition between the seasons was a bridge to the world of the dead. Over time the holiday transitioned from a somber pagan ritual to a day of merriment, costumes, parades and sweet treats for children and adults. Halloween or All Hallows' Evening is a yearly celebration observed in a number of countries on October 31, the eve of the Western Christian feast of All Hallows' Day. Typical festive Halloween activities include trick-or-treating, attending costume parties, decorating, carving pumpkins into jack-o'-lanterns, lighting bonfires, apple bobbing, visiting haunted attractions, playing pranks, telling scary stories and watching horror films. In many parts of the world, the Christian religious observances of All Hallows' Eve, including attending church services and lighting candles on the graves of the dead, remain popular. In other locations, these customs are less pronounced in favor of a more commercialized and secularized celebration. In Ireland and Scotland, the turnip has traditionally been carved during Halloween, but immigrants to North America used the native pumpkin, which is both softer and much larger – making it easier to carve than a turnip. The American tradition of carving pumpkins is recorded in 1837 and was originally associated with harvest time. It did not become specifically associated with Halloween until the mid 19th century. The modern imagery of Halloween comes from many sources, including Christian influences, national customs, works of Gothic and horror literature (such as the novels Frankenstein and Dracula) and classic horror films (such as Frankenstein and The Mummy). Imagery of the skull, a reference to Golgotha, in the Christian tradition, serves as a reminder of death and the transitory quality of human life and so skulls have been commonplace in Halloween. Elements of the autumn season, such as pumpkins, corn husks and scarecrows, are also prevalent. Homes are often decorated with these types of symbols around Halloween. Halloween imagery includes themes of death, evil, and mythical monsters. Black, orange, and sometimes purple are Halloween's traditional colors. Haunted attractions are popular entertainment venues designed to thrill and scare patrons. Origins of these paid scare venues are difficult to pinpoint, but it is generally accepted that they were first commonly used by the Junior Chamber International (Jaycees) for fundraising. They include haunted houses, corn mazes, and hayrides, and the level of sophistication of the effects has risen as the industry has grown. Haunted attractions in the United States bring in an estimated $300–500 million each year, and draw some 400,000 customers. This maturing and growth within the industry has led to technically more advanced special effects and costuming, comparable with that of Hollywood films. On All Hallows' Eve, in Poland, believers pray out loud as they walk through the forests in order that the souls of the dead might find comfort. In Spain, Christian priests toll their church bells in order to remind their congregants to remember the dead on All Hallows' Eve. In Ireland, and among immigrants in Canada, a custom includes the Christian practice of abstinence, keeping All Hallows' Eve as a meatless day with pancakes being served instead. In Mexico, the children make a children's altar to invite the angelitos (spirits of dead children) to come back for a visit. The Christian Church traditionally observed Halloween through a vigil when worshippers would prepare themselves with prayers and fasting prior to the feast day itself. This church service is known as the Vigil of All Hallows or the Vigil of All Saints. After the service, suitable festivities and entertainments often follow, as well as a visit to the graveyard or cemetery, where flowers and candles are often placed in preparation for All Hallows' Day. In Utah and perhaps in other places in the United States, trunk or treat has become a popular way of celebrating Halloween. This tradition allows children to trick or treat but also allows parents some sense of safety since the trick or treating is confined to a parking lot where parents assume they know the individuals giving out the treats. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Is Your Estate Plan Obsolete?

Tuesday, 20 October 2015 by Brendan Bybee, JD MPA

You likely felt a huge sense of relief when you first signed your estate planning documents after years of procrastination. Like most people, you were anxious to set aside the contemplation of your dreaded mortality. But, in the rush to move on, you may have forgotten that an estate plan has a shelf life. No, your Will or Trust won’t spoil, expire or self-destruct, mission impossible style, it will still “work,” but it may not do what you intended or expected. Unfortunately, the natural passage of time can turn your initial sense of relief into a false sense of comfort. Though frustrating, this limitation has nothing to do with the cost or quality of your estate plan. Your estate plan is, of necessity, designed around a snapshot of your life and circumstances taken at the time your plan is designed and drafted. But, your personal and family dynamics will tend to change as you age and your financial concerns will evolve as you build wealth and acquire property. Laws, too, will change, with significant impact on the expected outcomes of your planning decisions. Life simply has a way of taking unexpected turns. Your best efforts to prepare for the foreseeable future can look laughable in hindsight as you consider the unexpected events that have occurred since you took your estate plan home. Failing to review and update your plan on a regular basis can seriously frustrate your purposes and result in a great deal more trouble and expense for your loved ones. To ensure your estate plan does what you want it to when you really need it to, you should sit down with your attorney and review your plan regularly (at least every 2 to 3 years) or upon the happening of a major life event such as: Moving out of state. The birth or adoption of a child or grandchild or other change in the number of dependents, such as through a guardianship appointment. Children or grandchildren reaching adulthood. The illness, death or disability of any immediate family member or other intended beneficiary. Marriage or divorce for yourself or your children or other intended beneficiaries. Career changes or the beginning or dissolution of a business. Changes in your financial concerns or goals. Purchase of a home or other valuable asset. Large increases or decreases in the value of your assets. Receipt of a large gift or inheritance. Death or change in circumstances of the guardians, executors, trustees or other fiduciaries named in your estate plan. Even if your intentions and financial circumstances have remained relatively constant, you could find that congress has effectively rewritten your estate plan. Over the last few years, significant changes in the law have created new challenges as well as opportunities for estate planning. If your plan is now several years old, it is likely very unsuited to take advantage of these new opportunities. As a result, your plan, if not brought up-to-date, could cause serious frustration for your surviving spouse or children. The only thing worse than having no plan is having a plan that no longer works for you. If it’s been a while since you’ve reviewed your estate plan, please contact our office. Let’s sit down together and make sure your plan works for you now and in the future. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Why Having Your Adult Child On Title To Your Home Or Bank Account Is A Bad Idea

Tuesday, 13 October 2015 by Ricky Nelson, JD

You have probably had a neighbor or friend tell you that you should put one of your kids on title to your house and your bank accounts so that if anything happens to you, that child can step in and pay your bills and won’t have to hire an attorney and if you pass away, your estate won’t have to go through probate. If done correctly, whichever asset you put your child on title to won’t have to go through probate. However, putting your child on title to your house or bank account is a really bad idea for several reasons: Your child’s future creditors can take what you consider to be your assets. If you make your child a part owner to your house or bank account, then any of your child’s future creditors will be able to take your child’s assets including part of your home or bank account. Now you might say to yourself that your child is responsible and won’t have any creditors that they can’t pay, but even if that is true, there are some events that create creditors to even responsible people like divorce or car accidents. For example, if you and your spouse decide to add your oldest son to your home as joint tenants, then your son would own 1/3 of your home. If your son then gets a divorce, then his soon-to-be ex-wife will probably have a marital interest in your home. You would then have to buy her out of the 1/3 interest or she may force the sale of your home. It makes you liable for gift taxes. You can only give a limited amount to an individual each year tax free. For 2015, that amount is $14,000. If you give someone more than $14,000 (either in cash or anything of value, including an interest in your home) then you have to pay gift taxes. For example, if you and your wife decide to add your oldest son to your home as joint tenants and your home is worth $300,000 (even if you owe $400,000) then you gifted your son $100,000 and you would owe gift taxes. There are other tax related problems that this can cause, like loss in step-up-in basis and loss of property tax benefits. It creates extra potential liabilities for your child. For example, if someone gets hurt on your property and your home insurance doesn’t pay for it all, then just as your child is a joint owner, they are jointly responsible for any damages. You lose complete control. We have all heard of the story of some adult child kicking his elderly mother out of her house after she put him on title. Most people who do put their kids on title will say that their son or daughter would never do that, but everyone has seen a family member do something that was completely out-of-character. At my office we call that “getting a bonk on the head.” You don’t want to have to worry about something like this. It creates inheritance problems if you have more than one child. The couples who meet with me who have put their child on title when they have more than one child always tell me that they want all their kids to receive equal shares after they die and that they have informed their child who is on title with them that the child should give equal portions of the house to the other children. If this is what you want to do, then putting one child on title is a bad way to do it. The child on title is under no legal obligation to give equal portions of the house to the other children, in fact if the child does give portions to the other children, then that child may have to pay gift taxes on those gifts. The above list is just a few of the most common problems with adding one or more of your kids to the title of your home or bank account. Whatever you are trying to accomplish by adding an adult child to your assets, there are better ways of doing so. Whether you want to avoid probate, qualify for long term care Medicaid, want someone to be able to pay your bills if you can’t, or some other reason, we can help you in a way that will give you peace of mind. If you are thinking about adding a child to any of your assets, if you already have added a child to your assets, or if you are a child whose parent(s) have added you to their assets, then please call me for a free initial consultation so we can help. At the initial consultation we will discuss your specific concerns and situation, and I will work with you to come up with an estate plan that is right for you. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Framing the Debate

Monday, 12 October 2015 by Brady Brammer, JD MPA

I once had an opposing counsel that would file motion after motion—each of which had the same introduction to the case and all of them involving the horrible atrocities of my client. While annoying, this is not an uncommon litigation tactic. It was his way of “framing” the litigation. The same tactic is common with presidential candidates which frame their campaigns and their opponents both positively (see Reagan’s “City on Hill”) and negatively (see Romney’s 47% gaffe). In fact, it is one of the key ingredients of rhetorical skill in our attempts to construct a point of view. Just as the frame of a house dictates the structure of the walls and roof line of a home, the way in which we frame our arguments influences the reception of our evidence by the jury or judge. If the frame is not appealing or if the evidence does not fit within our frame, our arguments may be disregarded. There is a lot out there on the topic, but I wanted to focus on the idea of “gain framing” and “loss framing.” To do so, consider the following scenario and choice: PROBLEM: a large car manufacturer has recently been hit with a number of economic difficulties. It appears that it needs to close three plants and lay off 6,000 employees. The vice president of production, who has been exploring alternative ways to avoid the crisis, has developed two plans. Study No. 1 Plan A will save one of the three plants and 2,000 jobs. Plan B has a one-third probability of saving all three plants and all 6,000 jobs, but has a two-thirds probability of saving no plants and no jobs. What would you choose? Typically, 80% choose Plan A. Now, consider a subsequent study: Study No. 2 Plan C will result in the loss of two of the three plants and 4,000 jobs Plan D has a two-thirds probability of resulting in the loss of all three plants and all 6,000 jobs, but has a one-third probability of losing no plants and no jobs What would you choose (assuming you hadn’t just read about Study No. 1)? Typically, 80% chose Plan D. --Decision Analysis for Management Judgment by Paul Goodwin and George Wright You likely noticed that Plan A & C are substantially identical in result and both involve a fixed outcome (i.e. no “probability” of an event). You know what you are getting. You also probably noticed that Plan B & D are also substantially identical in result and both involve a “probability” of an event. But the big question is this: If A & C are substantially identical, why did 80% choose A in the first study and only 20% chose C? Here is the interesting fact: When debating a gain or positive impact, most people are naturally risk averse. When considering a loss or negative impact, most people are risk takers. In other words: Positive Framing → likely to choose the less risky option. Negative Framing → likely to choose the riskier option. Why does this matter? In every case, you are offering options to the trier of fact. If the choice you are advocating for is conservative in nature, your “frame” should be positive (gain, keep, save, build, etc.). If the choice you are advocating is riskier, your “frame” should be negative (loss, lose, damage, destroy, etc.). This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Preparation

Monday, 12 October 2015 by Erin McAllister, Paralegal

PREP·A·RA·TION the act or process of preparing the state of being prepared; readiness a measure done in order to prepare for something; provision: to make preparations for something. synonyms: devising, putting together, drawing up, construction, composition, production, getting ready, development, arrangements, planning, plans, preparatory measures. Paul Theroux once observed “Winter is a season of recovery and preparation.” Preparation for what? Perhaps we are burying the old year in anticipation of the new. Or maybe we are turning over a new leaf in anticipation of changes or progress. Our preparation should fall into two categories: Preparation for things we want and preparation for things we wish to avoid. Everyone would enjoy an interesting job, a loving family, good health, and a comfortable retirement at the end of their life. Most people would like to avoid catastrophes such as natural disasters, illnesses, financial hardships and emotional turmoil. How do we sort through the experiences and choices that face us daily and gravitate to the opportunities that we have hopefully been preparing for? “Sharpening the axe” can be likened to preparation. We can fill our lives with experiences and moments that will prepare us for the opportunities and calamities that await us. Education, meditation, interpersonal relationships and hard work can refine us and increase our wisdom for the choices that lay before us. Our success is dependent on our preparation and there is no short cut to success. It is found in preparation and determination. Our time of preparation will most likely be much longer than our achievement or the enjoyment of our spoils. Some misfortune and difficulty will come into everyone’s life, sometimes because of our lack of preparation and sometimes because of happenstance. How we face and deal with the situations that are placed before us will determine our success and happiness. The ability to overcome and move forward will largely depend on our preparation and willingness to change our path when obstacles arise. Change can be frightening, paralyzing and numbing. However, it can also be exhilarating, satisfying and motivating. Most growth and success come when we choose to confront change and the things we fear. Even in our failures, we learn and grow. The secret to success is that there is no secret. It is a by-product of years of preparation, hard work and learning from failures. Maybe the real secret is that preparation is a life-long pursuit. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

It’s Election Time in the City

Monday, 12 October 2015 by Erin McAllister, Paralegal

It’s Christmastime in the City. Well not quite yet, however it is Election Time in the City. And just how can we tell? Instead of red and green lights, tinsel, wrappings, carols, coats and caps, and cheery nods, egg nog and mistletoe, we see: those miserable lawn signs, we hear: campaign promises, including promises to lower taxes while providing more and more services, promises to save our second amendment right to bear arms (not even a local issue), promises to reform education (not a local issue) and finally get around to protecting our kids (a local issue), fix road and traffic jams, stop speeders (unless it is you) and, most significantly, promises to find (and arrest) whoever it is that leases those orange barrels used for street resurfacing projects—projects that seem never to end. It’s a time of year when most of us would rather read the sports page and follow Utah or BYU football and prepare for Halloween and family time over turkey and grandma’s oven fresh rolls in November, than think about heading to the ballot box at the local school, or, as things are changing, fill out a mail-in ballot in the family kitchen. So why do we have Election Time in the City? What does the City Government do for you and me and why is it that in most cases people cast their City election ballot for the most recognizable name, rather than for the person most prepared to really do something good for you and me? The City election is likely the election having the most impact on regular folks like you and me. We “normal” people worry about schools for our kids. And how do our kids get to school, but on a City street. We worry about school zones, and City policemen (and women) “police” school zones. We worry about neighborhood safety and it is the City police who protect us by patrolling and responding to crime, like break-ins and drug use at school and even domestic violence. If you are worried about the Fire Department or the Paramedic getting to your home in an emergency, it is the City council and mayor who are responsible. Normally, the Mayor appoints the Fire Chief and the Chief of Police. We need to get involved in our City. There are many other things decided by the City through the City Council (which passes ordinances and approves budgets, among many other things) and the Mayor, like traffic enforcement, animal control, local taxes and City infrastructure like road repair, water management, sewer and trash pickup. The City is involved in street repair, intersection control lights (red, yellow and green), street-light improvements in neighborhoods for neighborhood lighting, and even sidewalk repair and cross walk issues. Cities construct parks and athletic fields for our families and children, and cities plan the community so that, through local zoning ordinances, big stores do not move into family neighborhoods. The Mayor and City Council can help develop a master plan to develop a mall and other projects which can bring shopping and a strong commercial tax base to the community so they could lower citizen taxes. It’s not Christmastime yet, but it is Election time in the City. The right to vote becomes less of a right if we are uninformed and simply look at the brochure for the best looking family or for a name we recognize. A City election is almost useless unless we take the opportunity to look at the candidates (at least online), ask a few questions, and go into the voting booth as an informed voter. If you take the time to prepare, once the election is over, you will have the confidence to make a phone call or attend a meeting of the City Council and weigh in on an issue, or you may just have an idea on how to make your City a little safer. Who knows, you may even get a cross walk installed or repainted or find the Mayor a new Chief of Police. At election time, let’s get it together and vote intelligently so we can all be at home, safe and sound, in a better community when it is Christmastime in the City. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Applying for the New Colorado Job Growth Incentive Tax Credit

Monday, 14 September 2015 by Seth Gomm, JD MBA

Governor Bill Ritter recently signed into law a new tax credit for businesses that wish to create new jobs in Colorado. Businesses operating in Colorado can take advantage of the tax credit that can equate to 3.825% of the wage the business pays to each employee that qualifies under the credit. Background On May 4, 2009, Governor Bill Ritter signed into law House Bill 09-1001, known as the Colorado Job Growth Incentive Tax Credit (the “Credit”), which provides an income tax credit to firms that create jobs in Colorado. The Colorado Office of Economic Development and International Trade (the “Commission”) is charged with determining if an employer qualifies for the Credit. In order to qualify for the Credit an employer must, after applying and obtaining conditional approval from the Commission, create a certain number of jobs and maintain such new jobs for at least one year. The value of the Credit is typically equal to one-half of the amount the employer must pay in FICA taxes for the newly created jobs (approximately 3.825% per year for each new job’s annual wage). The Credit is available for tax years 2009 through 2018 with a maximum Credit eligibility period of no more than five total consecutive tax years per employer. Following is a checklist that can be used to help determine if an employer is eligible and to navigate the application process: General Pre-Qualifications 1. The employer must show that, but for the Credit, the employer would have likely created the new jobs in a state other than Colorado. 2. The employer must retain the new jobs for at least one year. 3. The new jobs must pay an average yearly wage that is at least 110% of the average yearly wage of the county in which the employer is located. 4. The employer must provide a minimum of 20 new jobs if the project that created the new jobs is NOT located in an Enhanced Rural Enterprise Zone (“ERE Zone”). If the project that created the new jobs is located in a ERE Zone, the employer only needs to provide a minimum of five new jobs, but the local community located in the ERE Zone must provide rationale of the importance to such local community of the project that will create the jobs. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Ethical Considerations of Client File Retention in a Technological Age

Monday, 14 September 2015 by Seth Gomm, JD MBA

Many legal practitioners have offices that curiously appear to be decorated with mounds and towers of paper and file boxes, which may or may not be arranged into a functioning organizational system. The ethical storage and maintenance of client files can seem like an overwhelming endeavor, and thus often is put off to be conquered at some future time. Many firms and practitioners can't quite remember what is actually contained in the numerous file boxes that have been laid to rest in a corner or closet of their offices but nonetheless require expensive rented space to accommodate them. Understanding what to keep, how long to keep it, and how it can be stored is an initial hurdle that can be overcome with a few simple principles found in the ethics rules and in opinions issued by various state bar ethics committees. Firms and practitioners that practice and operate in the present-day market must contend with the realities of the technologies that have infiltrated nearly every aspect of modern society. Internet and e-mail have opened up vast oceans of electronic information that can be easily searched, uploaded, downloaded, and printed or transmitted almost instantaneously. Ironically, the technological advances of the last two decades have buried firms in data, paper, and informational resources. Although it would seem that technology and digital information should decrease paper, electronic documents tend to generate even more paper. According to an article published in the ABA Journal, "[a]n information orientation ideally focuses on knowledge, not pages"; however, "[t]echnology has produced a paper blizzard." The authors estimate that the average law firm has accumulated more dead paper files in the last ten years than in the fifty years preceding. To handle this deluge of physical files, firms must find a solution that is efficient, cost-effective, and ethical. This article addresses ethical considerations with regard to appropriate client file retention and discusses what technological options and resources a firm has available in implementing an efficient file retention system. The article presents an overview of selected rules and principles from the Colorado Rules of Professional Conduct (Colorado Rules or Colo. RPC), opinions from the American Bar Association (ABA), formal guidance from the Colorado Bar Association (CBA) Ethics Committee, opinions from other state ethics committees addressing topics that Colorado has not yet formally addressed, and other relevant articles and resources. This article explains that rather than simply adopting a "keep everything" policy or a bright-line rule mandating the indiscriminate destruction of an entire client file, a firm should use common sense and selective determination as to what portions of a client file should be preserved or destroyed. For example: • Certain documents should never be destroyed because of the original and possibly irreplaceable nature of the documents. • Before destroying a file, a firm should always try to obtain client consent from affected clients. • A firm may consider an electronic storage system as an efficient and cost-effective alternative to paper file storage to prevent accidental premature file disposal and to help free up valuable physical storage space. • A firm may use third-party services to electronically store client files so long as the firm ensures that the third party preserves client confidentiality and maintains other safeguards as required by the Colorado Rules. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

See No Evil, Hear No Evil, Speak No Evil: Stoneridge Investment Partners, LLC V. Scientific-Atlanta, Inc. and the Supreme Court's Attempt To Determine the Issue of Scheme Liability

Monday, 14 September 2015 by Seth Gomm, JD MBA

In the spring of 2008, the United States Supreme Court handed down the much-anticipated Stoneridge Investment Partners, LLC v. Scientific-Atlanta, Inc. decision, which addressed whether shareholder-plaintiffs can sue secondary actors who may have participated in a fraudulent transaction with the plaintiffs' company. This theory of so-called “scheme liability” would give shareholder-plaintiffs legal recourse under § 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5. In this context, a “secondary actor” is a company or individual, other than the direct issuing company, that does not have a duty of disclosure to the issuing company's shareholders but who nonetheless aids the issuing company in defrauding its shareholders through schemes and fraudulent transactions. In Stoneridge, the Court held that there is not an implied private right of action for injured shareholder-plaintiffs under § 10(b) against secondary actors unless such plaintiffs relied on the secondary actors' deceptive acts. In reaching its decision, the Court reasoned that to show adequate reliance, shareholder plaintiffs must at least rely on public representations made by the secondary actors, or the secondary actors must have some duty to disclose to the injured shareholder-plaintiffs. In Stoneridge, the necessary reliance on the secondary actors' deceptive acts was too remote to justify a § 10(b) private action. The Court explained its fear of potential backlash in United States markets if it allowed private plaintiffs to pursue secondary actors under a theory of scheme liability and concluded that Congress alone has authority to permit such private actions. Stoneridge, however, is not without its problems. The Court's opinion focused heavily on the theory of reliance and appeared to confuse precedent and statutory language as it worked to justify its holding. Several cases, similar to Stoneridge, which involve petitions to hold secondary actors liable for their scheming conduct, worked their way through the circuit courts and created a circuit split. Simpson v. AOL Time Warner Inc. was vacated and remanded by the Supreme Court, and Regents of the University of California v. Credit Suisse First Boston (USA), Inc. was denied certiorari. The plaintiffs in both cases, however, still have the slim chance of establishing a private § 10(b) cause of action. Although the current Court is unlikely to allow private scheme-liability actions in the near future, Congress may act in favor of shareholder-plaintiffs when it sees the wisdom of allowing such § 10(b) actions. This article argues that while Stoneridge has further empowered the Securities and Exchange Commission (“SEC”) in its mandate to police the securities market, it has also left a discouraging and confusing result for injured shareholders who want to seek private restitution for their losses. The result appears to be that, so long as companies do not disclose to the public the truth behind sham contracts and transactions in which they have participated (thereby causing reliance), the companies probably will not be vulnerable to private actions from shareholders. Notwithstanding the Court's holding in Stoneridge, permitting shareholders to bring private § 10(b) actions against scheming secondary actors would improve the efficiency, transparency, and integrity of the United States securities market. Investors that are directly victimized by such schemes should be able to initiate private actions in order to seek redress for their losses without having to wait for the SEC to act. Part II of this article discusses the transaction structures of alleged “schemes” that could be subject to a theory of scheme liability, as well as the necessary elements of a § 10(b), a Rule 10b-5, or a securities fraud action. It also reviews past Supreme Court case law addressing the issue of secondary-actor liability. Part III details the split in authority that existed among the circuit courts of appeal on the topic of scheme liability and the various approaches taken by those courts regarding scheme liability. Part IV reviews the Supreme Court's decision in Stoneridge. Part V analyzes that decision and discusses the possible unfortunate consequences of the Court's decision. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

In Re Qwest Communications International, Inc.: The Tenth Circuit Hangs Up the Phone On Qwest's Petition for Selective Waiver, But the Line Is Not Dead

Monday, 14 September 2015 by Seth Gomm, JD MBA

In 2002, the Securities Exchange Commission (SEC) began investigating concerns regarding Qwest's business ac-counting practices. Soon thereafter, the Department of Justice (DOJ) began criminal investigations of the company and its top executives. Upon concluding its investigation, the SEC alleged that Qwest was “engaged in massive financial fraud that hid from the investing public the true source of the company's revenue and earnings growth, caused the company to fraudulently report approximately $3 billion in revenue, and facilitated the company's June 2000 merger with US West.” The SEC claimed that Qwest fraudulently characterized nonrecurring revenue as recurring “data and Internet service revenues” in an attempt to hide the company's declining financial condition. After inflating the revenue reported on Qwest's financial statements, top executives allegedly committed insider trading when they sold large amounts of stock at a time when the executives knew they would miss Qwest's financial targets. Following the SEC and DOJ investigations, numerous Qwest stockholders filed civil lawsuits against Qwest. During the course of these proceedings, Qwest sought to protect documents that it had disclosed to the SEC and DOJ during their investigations, which might otherwise have been protected from discovery under the attorney-client privilege and work product doctrine. After a district court found that Qwest had waived its attorney-client privilege by its disclosures to the government, Qwest appealed to the Tenth Circuit Court of Appeals on the ground that the selective waiver doctrine should apply to protect these disclosures. The Tenth Circuit did not find an exception to the traditional waiver rule of the attorney-client privilege and work product doctrine. Qwest failed to convince the court to adopt the doctrine of selective waiver, and was left to contend with exposure of its otherwise privileged documents to third-party litigants. The Tenth Circuit, in its first decision regarding selective waiver, concluded that Qwest's attempt to invoke the selective waiver doctrine was not motivated by an interest in justice, but rather a desire to appease the investigating governmental agencies while deflecting discovery from private litigants. The court saw Qwest's petition for selective waiver as an attempt to create a new privilege, rather than as an extension or exception to the existing traditional privileges. Many courts and commentators have made compelling policy arguments both for and against adoption of selective waiver. The issue of selective waiver and the nature of its application or adoption have been disputed in other circuit courts and have resulted in a federal circuit split. Because of the unpredictability created by this circuit split, either Congress or the Supreme Court needs to create a uniform solution. A uniform rule is particularly important in today's world, where many business entities establish a national and international presence. Ultimately, Congress and/or the Supreme Court should adopt the selective waiver doctrine in a manner that would ensure cooperation between corporations and the government, thereby enabling government agencies to secure a fair marketplace for public investors. Part I of this article introduces and examines the background of traditional legal doctrines and principles that gave rise to the dispute in In re Qwest Communications International, Inc. Part II discusses the existing federal circuit court split over the doctrine of selective waiver and its application to both the attorney-client privilege and work product doctrine. Part III examines the facts and reasoning in the Tenth Circuit's In re Qwest decision. Part IV analyzes the Tenth Circuit's reasoning, discusses policy arguments both for and against the adoption of selective waiver, and provides an overview of current legislative attempts to create a uniform rule for selective waiver application. This article will argue the following three points: (1) a uniform selective waiver rule is essential in a modern era of increasing globalization and corporate misbehavior; (2) the selective waiver doctrine should be adopted to ensure cooperation between governmental agencies and corporations; and (3) corporations and government agencies should be able to enforce confidentiality agreements. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Primary Liability and In Re Charter Communications

Monday, 14 September 2015 by Seth Gomm, JD MBA

In Charter, the plaintiffs claimed that vendors of Charter, who provided Charter with set-top cable television boxes, violated §10(b) of the 1934 Exchange Act. The vendors agreed to charge Charter a $20 premium over their regular market price, the vendors then agreed to return the $20 premium to Charter in the form of advertising fees. Charter allegedly misreported the $20 premium in an attempt to inflate the company’s cash flow by $17,000,000 in the fourth quarter of 2000 in order to meet Wall Street analyst expectations. The plaintiff’s in Charter claimed that the vendors were primarily liable for the alleged fraud under §10(b). The Supreme Court in Central Bank of Denver v. First Interstate Bank of Denver clarified that §10(b) does not extend to aiding and abetting violations. The Court nonetheless acknowledged that “[a]ny person or entity, including a lawyer, accountant, or bank, who employs a manipulative device or makes a material misstatement (or omission) on which a purchaser or seller of securities relies may be liable as a primary violator under 10b-5 . . .” The 8th Circuit concluded that the vendors could not be sued as primary violators under Section 10(b). The court concluded that to engage in a fraudulent scheme or contrivance required a “misstatement or a failure to disclose by one who has a duty to disclose.” The vendors were not accused of issuing any statements to the investing public and had no duty to disclose any information about Charter’s true financial condition or accounting practices. As the court stated “we are aware of no case imposing §10(b) or Rule 10b-5 liability on a business that entered into an arm’s length non-securities transaction with an entity that then used the transaction to publish false and misleading statements to its investors and analysts.” The court explained that such a finding “would introduce far-reaching duties and uncertainties for those engaged in day-to-day business dealings.” The Supreme Court has agreed to take up the issue. Chief Justice Roberts and Justice Breyer have recused themselves so that only a majority of 4 is required to decide the potentially far-reaching liability toward vendors and other secondary parties that may have traditionally been viewed simply as aiding and abetting a primary culpable party. If the Supreme Court rules in favor of the plaintiff in Charter, the decision could impose a heavy burden on businesses since secondary parties such as vendors could be liable under Section 10(b), greatly widening the circle of potential “deep pocket” defendants. Secondary parties could conceivably find themselves liable for acts that had effect on companies several stages down the supply chain. An entity’s duty could be effectively extended not only to its own shareholders, but also to the shareholders of remote outside companies that it may have done business with. This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Driving Directions from I-15:
• Take the Pleasant Grove exit 275 from I-15
• Turn North onto Pleasant Grove Blvd
• Turn left onto W. Grove Pkwy
• Quickly turn left into the Synergy/Spaulding Law parking lot.