I just learned of an interesting new insurance policy product, which a party in a breach of contract litigation can purchase shortly after the start of the lawsuit, that will cover the insured against a judgment against it to pay the attorneys’ fees of the opposing party under a prevailing party attorneys’ fees provision in a contract. Such a policy can be purchased by a defendant or a plaintiff in a breach of contract lawsuit, and can significantly reduce the down-side risk associated with losing such a lawsuit. —Adam Treiger
Administrative Exemption
February 25, 2011 By Leave a Comment
An important case was handed down by the California Court of Appeal on February 2, 2011, which holds that the plaintiff claims adjusters were exempt from overtime pay requirements under California’s “administrative exemption”. Hodge v. AON Insurance Services. In so holding, the court refused to apply the “administrative/production dichotomy” used by the earlier case of Bell v. Farmers Ins. Exchange, which found claims representatives to be non-exempt employees, not covered by the administrative exemption. The Hodge case makes clear that very little is clear in California wage and hour law, and that the classification of workers as exempt or non-exempt remains a very tricky business. —Adam K. Treiger
Religious Institutions and Employment Law
February 15, 2011 By Leave a Comment
California religious institutions are exempt from some employment laws, but most employment laws apply to churches and their employees. On the federal law side, religious institutions are subject to Title VII of the Civil Rights Act (the federal anti-discrimination/harassment law), but there is an exception for those who are ministers. These institutions are also exempt from the religious discrimination portion of Title VII. On the California state law side, religious institutions are completely exempt from the California Fair Employment and Housing Act (“FEHA”), which is the state anti-discrimination/harassment law. But, religious institutions are still subject to the anti-discrimination/harassment provisions of the California Constitution, and so the FEHA exemption is not all-encompassing. State and federal wage and hour laws apply equally to religious institutions, other than to their ministers (due to the First Amendment to the U.S. Constitution). Because these exemptions are very complex, many religious institutions believe that they are not subject to many laws to which they are, in fact, subject. Before making assumptions that could create liability, religious institutions should always consult with their legal counsel. —Adam Treiger
Paid Time Off
February 12, 2011 By Leave a Comment
Many employers grant their employees Paid Time Off (“PTO”) rather than differentiate between paid vacation and paid sick leave. In general, there is nothing wrong with a PTO policy. It is generous to employees and easier to administer for the employer. But, the reason PTO is not always advisable is because all of the time off an employer gives as PTO is considered, legally, as vacation time, and thus all of that time off cannot be subject to a “use it or lose it” policy (and must be carried over from year to year until used). Moreover, all of that time off, if unused, must be paid out in cash upon termination or resignation. In contrast, if an employer divides the paid time off into paid vacation and paid sick leave, only the vacation time is subject to those rules, while the sick leave can be “use it or lose it” and need not be paid out in cash upon termination or resignation. Thus, if the employer divides the PTO into paid vacation and paid sick time, rather than lumping it all together as PTO, the employer may realize significant cost-savings for the sick leave portion of the benefit. —Adam Treiger
Internet Domain Names
February 12, 2011 By Leave a Comment
Internet domain names can conflict with a trademark, other intellectual property rights, or another established internet domain name. The holder of a trademark or other intellectual property right may bring an action in court for trademark infringement and unfair competition, and they may seek an injunction or damages. Of course, full-blown court litigation is a very time-consuming and expensive process.
As an alternative to litigation, a party who believes that a domain name infringes on its rights may file a binding arbitration with the World Intellectual Property Organization (“WIPO”) under the rules of the Internet Corporation for Assigned Names and Numbers (“ICANN”). The aggrieved party files a complaint and brief with WIPO, and the allegedly infringing party has the opportunity to respond in kind. After reviewing the two briefs, a WIPO arbitrator or panel of arbitrators will either deny the petition, or will transfer the disputed domain name to the party who filed the arbitration. WIPO arbitrators, however, cannot award damages, attorneys’ fees, injunctions, or any remedy other than domain name transfer. Oral arguments, live testimony, depositions and written discovery are not part of WIPO proceedings. As a result, these proceedings typically take only a few months from start to finish, are relatively inexpensive compared to litigation.
In our Internet age, domain names are as critical and central to businesses as are their names and logos (sometimes more so). It is a good thing that there are multiple avenues to protect these valuable forms of intellectual property, which include traditional court litigation and WIPO arbitrations. —Adam Treiger
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