Meyer, Unkovic & Scott Attorney Articles Featured in SMC's HRM UPdate

The January 2014 issue of SMC Business Council's HRM UPdate contains the following articles from Meyer, Unkovic & Scott attorneys.

Have Employees Working From Home?

• Tips For Mitigating Claims for At-home Worksites by Beth A. Slagle
• Wage and Hour Issues Involving Employees Working From Home by Elaina Smiley

Reporting The Cost of Health Care Coverage on Form W-2: A Reminder by Jason Mettley.

Please click here to read all three articles.

Business Workshop: Infosys to Pay Record Fine for Immigration Abuses

Joel Pfeffer, Esquire
jp@muslaw.com

An India-based information technology consulting firm will have to pay the largest fine ever for immigration abuses. Infosys will pay a record $34 million for allegedly bringing Indian employees into the United States illegally by misclassifying their immigration status.

The U.S. Department of Justice accused Infosys of using B-1 visas to bring workers into the United States for jobs reserved for American workers or H-1B visa holders. B-1 visas, sometimes called "business visitor visas," allow people to enter the country for meetings, training or other temporary activities. Current immigration laws do not permit B-1 visa holders to do any work.

H-1B visas enable companies to hire foreign nationals and immigrants for jobs for which companies cannot find U.S. citizens to fill. Current law caps H-1B visas at 65,000 a year and the competition for these limited slots is fierce.

Not only was Infosys accused of bringing the workers in under the wrong visa, but also of paying them below the prevailing wage in the United States, which is not allowed for H-1B visas.

During the investigation, authorities identified about 6,500 foreigners who came to the United States under the B-1 visa program over a five-year period and worked for Infosys in violation of their visa. Infosys admitted no wrong-doing in agreeing to what is the largest fine ever for an immigration matter.

A spokesperson for the government has said that Infosys may not be the only company which is defrauding the government by misclassifying visas. Companies should be warned that the federal government is cracking down on companies that misfile or commit other types of visa fraud.

For more information on this topic, please contact Joel Pfeffer at jp@muslaw.com.

This article originally appeared in the Pittsburgh Post-Gazette's Business Workshop section. Business Workshop is a weekly feature from local experts offering tidbits on matters affecting business. Read more:  http://www.post-gazette.com/business/legal/2014/01/06/Business-Workshop-Infosys-to-pay-record-fine-for-immigration-abuses/stories/2014010600050000000#ixzz2po4k3xrA

Meyer, Unkovic & Scott Announces New Partners

Meyer, Unkovic & Scott has named attorneys Jason Mettley, Andrew Noble, Sarah Reigle and Jason Yarbrough as new partners.

Jason Mettley works with clients on matters related to employee benefit plans, including plan design and drafting, fiduciary responsibility, plan governance and contributions collections. He has litigated a broad range of Employee Retirement Income Security Act (ERISA) cases and has extensive experience working with employers and labor organizations on collectively bargained retirement plans. Mettley graduated from Allegheny College and Widener University School of Law. He currently resides in Squirrel Hill.

Andrew Noble is a member of the firm’s Business Litigation, Tort Litigation and Intellectual Property Groups. He has represented large corporations and small businesses in both state and federal courts in cases involving breach of contract, copyright infringement, trade secret misappropriation, insurance coverage, oil and gas leases and commercial landlord-tenant disputes. He graduated from the University of Pittsburgh and the University of Pittsburgh School of Law. Noble is a resident of Oakmont.

Sarah Reigle is a member of Meyer, Unkovic & Scott’s Real Estate & Lending and Corporate & Business Law Groups. She focuses her practice on commercial real estate transactions, advising clients on the purchase, development, use and sale of real estate.  Reigle also represents landlords and tenants in leasing transactions involving industrial, retail, office and mixed-use properties.  In addition she represents borrowers and lenders in connection with commercial financing transactions. Reigle graduated from Franklin & Marshall College and Cornell Law School. She resides in Franklin Park.

Jason Yarbrough is a member of Meyer, Unkovic & Scott’s Construction Law, Litigation & Dispute Resolution and Creditors' Rights Groups. Yarbrough represents corporations, officers, individuals and family-owned businesses in a variety of complex commercial, construction and real estate litigation matters.  Yarbrough serves on the Allegheny County Bar Association’s Construction Council, and has represented owners, contractors, engineers, and code enforcement officials in disputes arising out of both public and private construction projects. He also frequently litigates claims involving contractual disputes, commercial landlord-tenant matters, claims arising out of the sale or lease of commercial and residential real estate, and real property tax assessments. He graduated from the University of Notre Dame and the University of Pittsburgh School of Law. Yarbrough lives in Hampton Township.

Facebook ‘Likes’ Are Protected Free Speech

Beth A. Slagle, Esquire
bas@muslaw.com

“Facebook ‘likes’ are protected free speech”, an article by Beth Slagle appeared the December issue of Western Pennsylvania Healthcare News. Below is the link to view the article online via the digital version. 

Please click here to read the full article which can be found on page 1 and 5.

Affordable Care Act Seminar - February 4th

The Affordable Care Act:  A Look at the PPACA's Employer Shared Responsibility Payment Rules

ACBA Labor & Employment CLE | ACBA - Continuing Legal Education

February 4, 2014    Tuesday    12:00pm - 1:00pm

The Patient Protection and Affordable Care Act is a large and complex law enacting sweeping changes in the way health care will be provided in America.  The provisions of the PPACA are expansive as are its implementing regulations.  As it relates to employers, the PPACA contains various new requirements, in particular the Employer Shared Responsibility Payment provisions (the “Pay or Play” rules).  This program will focus on the comprehensive regulations regarding the Shared Responsibility payment provisions.  Practitioners representing employers will want to familiarize themselves with these provisions before they take effect in 2015.

SPEAKERS:

Jason Mettley, Esq.

Meyer Unkovic & Scott LLP

David E. Mitchell, Esq.

Campbell Durrant Beatty Palombo & Miller, P.C.

MODERATOR:

Julie A. Aquino, Esq.

Campbell Durrant Beatty Palombo & Miller, P.C.

Location: 

Conference Center Auditorium
920 City-County Bldg
414 Grant Street
Pittsburgh, PA 15219
Phone: 412-402-6704

Credit Hours1.00   (1 hour of Substantive Credit)

Please click here for  more information or to register.

Zoning Applicant Entitled to Mandamus Relief?

Frank Kosir, Jr.
fk@muslaw.com

Gibraltar Rock, Inc., et al  v. New Hanover Township Zoning Hearing Board, 2013 Pa. Commw. LEXIS 118 (2013)

This matter addressed the issue of whether a zoning applicant was entitled to mandamus relief resulting from a Zoning Board’s failure to issue a timely decision on an application seeking zoning relief and setting forth a substantive challenge to the zoning ordinance.  Gibraltar Rock, Inc. (“Gibraltar” ) and Sahara Sand, Inc. (“Landowners”) sought to develop a stone quarry on three parcels of real property totaling 157 acres and being situated in the Light Industrial (LI), Heavy Industrial (HI) and the Residential Modified (R-2M) Districts of New Hanover Township (“Township”), Montgomery County, Pennsylvania.  Prior to 2001, the Township Zoning Ordinance (“Ordinance”) did not permit quarrying in any zoning district within the Township and, in March of 2001, Gibraltar filed a substantive challenge of the Ordinance with the Township Zoning Hearing Board (“Board”) asserting that it unconstitutionally excluded quarrying, thereby entitling it to either a zoning amendment or a special exception permitting the operation of the quarry.  In response, in October of  2001, the Township amended the Ordinance to classify quarrying as a permitted use in the HI District.  Thereafter, in January of 2003, prior to the Board rendering a decision on its 2001 challenge, Gibraltar filed a second challenge with the Board asserting that the amended Ordinance continued to unconstitutionally exclude quarrying in a majority of the Township.  In June of 2007, after conducting 67 separate hearings on the 2001 application, the Board rejected the validity challenge, but granted Gibraltar a special exception to operate a quarry on the portion of the lands situated in the HI District, subject to numerous conditions.   Thereafter, in  January, 2010, after holding 51 hearings, the Board issue a decision denying the 2003 application, but again granting Gibraltar a special exception to operate a quarry on the portion of the lands situated in the HI District, subject to the exact same conditions imposed in the June, 2007, approval.  Both the Township and Gibraltar appealed to the Montgomery County Court of Common Pleas.

While these appeals were pending, in December, 2007, the Landowners filed another application with the Board seeking to operate a quarry on the lands included in the prior applications, plus an additional 50 acres titled in Sahara Sand.  In this third application, the Landowners challenged the procedural aspects of the 2003 amendments to the Ordinance, that the original Ordinance was unconstitutional due to its specific exclusion of quarries, and that their proposed quarrying operation was governed solely by Noncoal Surface Mining Conservation and Reclamation Act (“Act’) (52 P.S. §§3301-3326).  The Board conducted a hearing on the 2007 application, at which several neighboring property owners appeared to challenge the application on the grounds that it sought to re-litigate the validity challenge set forth in the 2001 appeal, which remained pending before the trial court.  On July 2, 2009, the Board issued a written decision dismissing the 2007 application and the Landowners filed a zoning appeal in the Montgomery County Court of Common Pleas alleging that the 2007 application was improperly dismissed due to the fact that Sahara Sand was not a party to the 2001 application and, as such, held an independent right to pursue the validity challenge.  In addition, the Landowners filed a Complaint in Mandamus seeking a deemed approval of the 2007 application on the grounds that the Board had not issued a decision within 45 days, as required by Section 908(9) of the Municipalities Planning Code (53 P.S. § 10908).  The trial court dismissed the zoning appeal, a ruling which was reversed by our Commonwealth Court as to the 2007 procedural challenge (2012 Pa. Commw. Unpub. LEXIS 514 (2012)).  Thereafter, the trial court held a hearing on the mandamus action and issued an order dismissing the action with prejudice concluding, inter alia, that, since the Landowners had failed to bring the procedural challenge within thirty (30) days of the enactment of the amended Ordinance, it was time-barred.

On appeal, our Commonwealth Court affirmed.  In issuing its ruling, the court acknowledged that Section 10908(9) of the Code provides that a zoning board’s failure to issue a written decision on a zoning application within 45 days of the last hearing on the application results in a deemed approval of the decision.  However, the court noted that, pursuant to Section 916.1(f)(4) of the Code (53 P.S. § 10908(9), a substantive validity challenge to an ordinance will be deemed denied if the zoning board fails to act within 45 days of the last hearing on the challenge.  In this instance, the Landowners’ application included not only a request for zoning relief, but also a challenge to the validity of the Ordinance.  As such, the Board’s failure to issue a written decision within 45 days of the last hearing resulted in a deemed denial, not a deemed approval.   

Alleged Breach of Oil and Gas Leases

Frank Kosir, Jr.
fk@muslaw.com

Cardinale, et al v. R.E. Gas Development, LLC, et al; 2013 PA Super 146, 2013 Pa. Super. LEXIS 1149 (2013)

This matter addressed the issue of whether property owners alleging a breach of oil and gas leases had pled a Complaint sufficient to survive demurrer.  Lucinda A. Cardinale and Iola Hugney, on their own behalf and on behalf of all those similarly situated (“Lessors"), filed a three count class action complaint against R.E. Gas Development, LLC (“R.E. Gas”) and Rex Energy Corporation (“Rex Energy”) (“Lessees”). The Complaint set forth causes of action in breach of contract, tortious interference with contract and civil conspiracy alleging that, in 2008, R.E. Gas, a subsidiary of Rex Energy, entered into Marcellus Shale gas leases with the Lessors by which it agreed to, inter alia, pay an up-front bonus of $2,500.00 per acre which it has since failed to pay.  In response, Lessees filed Preliminary Objections in the nature of a demurrer asserting that, since the individual leases each included an “Order of Payment” stating that all payments under the leases were “subject to (lessee’s) inspection, approval of the surface, geology and title,” the parties had not entered into a binding contract and no bonus payments were due.  The trial court sustained the Preliminary Objections, and dismissed the Complaint with prejudice.

On appeal, our Superior Court reversed.  In issuing its ruling, the court noted that, in reviewing the dismissal of a matter on demurrer, its standard of review requires a review of the record in a light most favorable to the appellant Lessors.  As such, the court examined all of the documents that comprised the alleged lease and found that the documents identified the parties, described the lands included, set forth an effective date, stated the specific uses that the Lessees could make of the lands, and provided for the unconditional payment of the per-acre bonus.  Furthermore, a review of the Order of Payment found language supporting a conclusion that the parties intended for the document to be construed separate from the lease itself.  Therefore, the record contained sufficient evidence of the existence of a contract between the parties so as to survive a demurrer, and the trial court had erred in dismissing the Lessors’ Complaint on Preliminary Objections.

Business Workshop: Feds Look to Improve IP Enforcement

David G. Oberdick, Esquire
dgo@muslaw.com

The federal government recently announced strategies to improve enforcement of intellectual property laws.

The Obama administration wants to increase online enforcement and reduce the number of frivolous patent cases that are currently burdening the courts.

The White House plan to improve online IP enforcement, known as the 2013 Strategic Plan on Intellectual Property Enforcement, calls for voluntary -- rather than governmental -- enforcement of IP rights through private partnerships among companies with a stake in protecting IP rights, such as search engines, Internet service providers, copyright holders and advertising networks.

The White House strategy focuses on supporting the development of new technologies that enable consumers to legally access protected material.

The plan hinges on the premise that consumers, when given the choice, will choose legitimate means of obtaining movies, books, branded merchandise and music over illegal methods.

Meanwhile, the Federal Trade Commission has announced that it is launching a massive investigation of companies that are viewed by some as being overly aggressive in enforcing IP rights, particularly patents.

The investigation targets patent assertion companies, sometimes known as "patent trolls" or non-practicing businesses, which operate by accumulating patents, usually related to technology, for the sole reason of filing lawsuits against other companies that may infringe on those patents. Many businesses choose to settle rather than litigate over patent rights.

The FTC's investigation aims to reduce unnecessary litigation and increase the transparency of patent holders.

These two new government initiatives present interesting news to companies that want to exercise and protect their intellectual property.

The Internet, in particular, has been rife with IP abuse, and both the White House and FTC programs focus their efforts on protecting online patent rights.

For more information on this topic, please contact David G. Oberdick at dgo@muslaw.com.

This article originally appeared in the Pittsburgh Post-Gazette's Business Workshop section. Business Workshop is a weekly feature from local experts offering tidbits on matters affecting business. Read more: http://www.post-gazette.com/businessnews/2013/10/21/Business-workshop-Feds-look-to-improve-IP-enforcement/stories/201310210066#ixzz2llDlKKMM

Entitled to Reimbursement from the Pennsylvania Underground Storage Tank Indemnification Fund?

Frank Kosir, Jr.
fk@muslaw.com

Transportation Services, Inc. v. Underground Storage Tank Indemnification Board, 2013 Pa. Commw. LEXIS 122 (2013)

This matter addressed the issue of whether a property owner was entitled to reimbursement from the Pennsylvania Underground Storage Tank Indemnification Fund for costs incurred in remediating environmental contamination.  Transportation Services, Inc. (TSI) was a commercial trucking business that operated in several states and was based at a facility erected on real property (“Property”) titled in Joseph Benacci and Berit Benacci and located at 3025 West 17th Street, Erie, Pennsylvania.  In 1977, the Benaccis installed four separate underground storage tanks at the Property for the storage of diesel, gasoline and new motor oil and, from 1982 to 1992, leased the Property to Ryder Truck Rental, which completed satisfactory remediation when certain leaks were discovered in the tanks.  Transportation Services used the Property for its trucking operations from 1992 through 1997, and the Pennsylvania Underground Storage Tank Indemnification Fund (“Fund”) charged it a capacity fee from 1994 through 1998.  In late 1997, the Property was conveyed to Transportation Investment Group (TIG), a partnership comprised of the Benaccis' five children, which proceeded to lease the Property to Fed-Ex for the construction of a new facility. During the course of construction, the storage tanks were emptied of approximately one inch of residue, all pumps removed, and the tanks rendered inoperable by late 1997.  However, due to their proximity to the new Fed-Ex facility, the tanks could not be removed and were permanently closed on site in accordance with Federal regulations.  Nonetheless, TSI continued to remit the requisite fees to the Fund through the middle of 1998.

Following the sealing of the tanks, the Pennsylvania Department of Environmental Protection (“DEP”) ordered TSI to install 3 monitoring wells and, in June of 2002, one of these wells detected a release of an unacceptable level of phase liquid. TSI completed the necessary remediation, and submitted a request for reimbursement to the Fund.  In response, the Fund’s  third-party administrator denied the claim on grounds that TSI’s fee obligations were delinquent at the time that the contamination was discovered.  TSI appealed to the Pennsylvania Insurance Department's Bureau of Special Funds which affirmed concluding that, since the capacity fees for the second half of 1998 remained unpaid, TSI was not entitled to reimbursement.  TSI then appealed to the Administrative Hearings Division of the Insurance Department, which affirmed, concluding that capacity fees must be paid until a permanent closure report is filed with the DEP, which report TSI did not file until December of 1998.  TSI then filed exceptions with the Fund’s Board, which exceptions were denied.

On appeal, our Commonwealth Court reversed.  In issuing its ruling, the court noted that, in rendering its decision, the Board had erroneously relied upon the 2002 version of the fee regulation (25 Pa. Code §971.2(3) rev.) (which permitted the assessment of fees for the storage of “regulated substances” including unknown substances) rather than the 1993 version (25 Pa. Code §971.2(3)) (which limited the imposition of capacity fees to the storage of “heating oil products and diesel fuel products”).  As the fees at issue were allegedly owed for the second half of 1998, they were subject to the 1993 version of the fee regulation and, since there was no dispute that only residue remained in the storage tanks at that time, TSI had no obligation to pay any further capacity fees.  The court also noted that there was no language in either the 1993 or 2002 version of the fee regulation providing for the assessment of capacity fees against empty storage tanks and, pursuant to 25 Pa. Code §245.451(a), a storage tank is considered empty even if it contains one inch of residue.  As such, the Fund lacked the authority to assess a capacity fee against TSI after the storage tanks were emptied in 1997, TSI was current on its capacity fees, and its claim for remediation costs was improperly denied.

10-Day Notice for Default Judgment

Frank Kosir, Jr.
fk@muslaw.com

Wells Fargo Bank, NA v. Vanmeter, 2013 PA Super 115, 2013 Pa. Super. LEXIS 725 (2013)

This matter addressed the issue of whether a party entering a default judgment must first file with the court a copy of the 10-Day Notice provided to the party against whom the default judgment is sought.  Edwin M. Vanmeter and Mary A. Vanmeter (“Debtors”) gave a mortgage (“Mortgage”) against certain real property (“Property”) situated in the City of Stroudsburg, Monroe County, Pennsylvania, to Wells Fargo Bank (“Wells Fargo”).  The Debtors defaulted under the Mortgage, and Wells Fargo commenced a foreclosure action by filing a Complaint in the Monroe County Court of Common Pleas.  The Complaint, which included a proper Notice to Defend, was served upon the Debtors on June 4, 2010.  The Debtors failed to file a responsive pleading and Wells Fargo filed a praecipe for default judgment to which were attached copies of four (4) separate 10-Day Notices provided to the individual Debtors at both their Pennsylvania and Florida addresses.   Pursuant to Wells Fargo’s praecipe, the court entered a default judgment against the Debtors on July 20, 2010.  Thereafter, on March 19, 2012, the Debtors filed a petition to open or strike the default judgment alleging, inter alia, that Wells Fargo’s failure to separately file the 10-Day Notices with the court prior to the filing of its praecipe for default judgment rendered the judgment defective.  The trial court heard arguments, and issued an order denying the Debtors’ petition.

On appeal, our Superior Court affirmed.  In issuing its ruling, the court noted that, pursuant to Pa.R.C.P. 237, a party seeking the entry of a default judgment is not required to file a copy of the 10-Day Notice with the court.  Rather, that party is only required to: (1) certify that notice of its intent to take a default judgment was provided to the opposing party at least ten (10) days prior to its taking of the judgment, and (2) attach a copy of the notice to its praecipe.  In this instance, the record established that Wells Fargo had provided the individual Debtors with the requisite 10-Day Notice at both their Florida and Pennsylvania addresses, that it had attached copies of those 10-Day Notices to its praecipe for default judgment, and that its praecipe included a certification of the service of the 10-Day Notices.  As such, Wells Fargo had satisfied all of the requirements of Pa.R.C.P. 237, and the trial court had properly refused to open or strike the default judgment. 

Death and Taxes May Be Certain, But The Amount of Estate Taxes Is Not

“In this world, nothing can be said to be certain, except death and taxes.” – Benjamin Franklin

John W. Powell, Esquire
jwp@muslaw.com

Taxes are a part of everyday life for business owners, from payroll taxes to corporate taxes to income taxes.

Business owners know that, even after death,  whatever wealth they have built up throughout their lifetimes may be subject to taxes that could drastically reduce the amount that they can leave to their loved ones.

But just how much those taxes will be is a very complicated calculation that is unique to each individual situation and the current set of laws.  Often, it comes down to a careful balance of how much someone should give to beneficiaries during his or her lifetime and how much the donor should save to bequeath in a will. Also, even though a gift is income tax-free to the recipient, the nature of a gift may have a significant impact on the recipient’s future income tax liability.

Historically, there have often been wild fluctuations in federal estate and gift tax levels from year to year that have made estate planning a difficult guessing game.  For example, many people faced a dilemma at the end of 2012 as many estate tax breaks were set to expire.  If Congress had not  acted by the end of the year, the amount of tax-free gifts that one person could give was set to drop from $5.12 million to $1 million.  Furthermore, the top tax rate on amounts more than $1 million was set to rise from 35% to 55%.  Thus, many people scrambled to give away portions of their wealth before the end of the year.

Congress finally stepped in to make a new law – but not until nearly midnight on January 1, 2013 -  after  many people had already made their gifts.  Congress passed the American Tax Relief Act (ATRA) that, among other tax provisions, permanently set the top estate tax rate at 40% and defined the tax-free exemption as $5 million, tied to inflation in the future.  In 2013, the exemption stands at $5.25 million.  ATRA also increased the top marginal income tax rate from 35% to 39.6% and increased top marginal taxes on income from dividends and capital gains from 15% to 20%.

Unfortunately, ATRA does little to simplify the question of give now or give later.  Even though some of the provisions are described as “permanent,” it only means that they have no set expiration date.  Congress can still change the law in the future as it deems necessary. 

At this time, the best way to determine an appropriate estate planning strategy is to calculate the taxes owed in a variety of scenarios with an experienced advisor who is an expert in the provisions of ATRA and other federal and state tax laws. The advisor will have to take the following factors into account:

• The donor’s current and projected net worth
• The donor’s life expectancy
• The income tax level of both the donor and recipient
• The types of assets intended for transfer, and their current and projected value
• The future likelihood of the sale of any assets
• The anticipated total federal income and transfer tax rates
• The anticipated total state income and transfer tax rates of both the donor’s and recipient’s state of residence.

Complicated tax laws may deter some people from taking the time to plan their estates, no matter the size.  But without a tax strategy, business owners who have worked hard to build wealth for their families may find their substantial legacies significantly diminished by taxes.  An experienced consultant who knows the details of tax laws can ensure that all appropriate taxes are paid while preserving the highest amount of an estate for a person’s loved ones.

Supreme Court Ruling on Defense of Marriage Act Changes Employee Benefits Administration

Jason Mettley, Esquire
jm@muslaw.com

On June 26, 2013, the Supreme Court ruled that Section 3 of the 1996 Defense of Marriage Act (DOMA), which defined marriage as a legal union between one man and one woman, was unconstitutional.

The case that prompted the ruling, United States v. Windsor, questioned whether legally married same-sex couples are entitled to the same federal tax benefits as opposite sex couples. The case opened the door for lawfully married same-sex couples to take advantage of more than 1,100 federal benefits already afforded to heterosexual married couples.

For many employers, the ruling created uncertainty with respect to employee benefit administration. Section 2 of DOMA, which allows a state to refuse to recognize same-sex marriages performed under the laws of other states, was not addressed by the Supreme Court and still stands as law. Accordingly, employers in states like Pennsylvania, which does not recognize same sex marriages, were left wondering how to administer benefits to employees in a same sex marriage lawfully formed in another state.

Please click here to read the full article from Western Pennsylvania Healthcare News.