"Ban the Box" Legislation Expands Across the Country ~ Employers Need to Update Employment Applications and Policies

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By Pillsbury Winthrop Shaw Pittman

Yesterday, Pillsbury attorneys Ken Taber, Paula Weber, Rebecca Carr Rizzo and Stephen Asay published their advisory titled "Ban the Box" Legislation Expands Across the Country Employers Need to Update Employment Applications and Policies. The Advisory discusses the growing national movement to "Ban the Box" - i.e., to prohibit questions about a job applicant's criminal history on employment applications.

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9th Cir. Ninth Circuit Holds Coast Guard "Letter of Recommendation" Provided in LNG Permitting Matter Was Not a Final Agency Action Triggering Appellate Review

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In Columbia Riverkeeper, et al. v. U.S. Coast Guard, decided on August 5, 2014, the U.S. Court of Appeals for the Ninth Circuit held that a Coast Guard "Letter of Recommendation" provided to FERC in connection with FERC's ongoing review of a proposed Oregon LNG terminal project was not a final agency action that was reviewable under the Natural Gas Act. The Letter was issued in 2009 and addressed the suitability of the Columbia River for vessel traffic associated with the facility; it was subjected to unsuccessful administrative appeals within the Coast Guard, after which this challenge was filed in the Ninth Circuit. After reviewing the regulatory apparatus that is used to determine whether a proposed LNG facility can be permitted by FERC, the Court of Appeals held that the Letter does not have any "conclusive legal effect", and it is therefore not a final agency action triggering judicial review. However, the Court of Appeals noted that the Letter could be an issue when the FERC permit is itself litigated, or if the Coast Guard issues a final order pursuant to its independent legal authority.

4th Cir. Orders Lower Court to Conduct Additional Hearings on Environmental Challenge to North Carolina Outer Banks Transportation Project

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The U.S. Court of Appeals for the Fourth Circuit recently reviewed the lower court's rejection of a series of challenges to an important North Carolina highway transportation project that will repair and restore access to the North Carolina Outer Banks. The case is Defenders of Wildlife, et al., v. North Carolina Department of Transportation, et al., decided August 6, 2014.

Following its review of a long and complex administrative record, the Court of Appeals upheld the lower court's dismissal of the plaintiffs' National Environmental Policy Act (NEPA) challenge to the complicated project, but ordered to court to conduct additional inquiries into the defendants' argument that the "joint planning exception" known as a "Section 4(f)" exception, was warranted. The "Section 4(f) exception" is a shorthand reference to a provision of the transportation laws administered by the Federal Highway Administration that affect the use of federal transportation funds in a designated wildlife area.

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PA Amends Mechanic's Liens Law

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On July 9, 2014, Pennsylvania Governor Tom Corbett signed into law PA State Flower.jpgSenate Bill 145 (aka "Act 117"), amending Pennsylvania's Mechanics' Lien Law of 1963. Act 117 is effective September 7, 2014.

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IL Governor Signs Bill to Limit Use of Payroll Cards

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On August 6, Illinois Governor Pat Quinn signed into law House Bill 5622, a bill amending the state Wage Payment and Collection Act, 820 Ill. Comp. Stat. §§ 115, et seq., and barring employers from making the use of payroll cards a condition of employment and preserving workers' right to demand more traditional forms of wage payment, such as paper checks and direct deposits into a bank account. The new law becomes effective January 1, 2015.

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Significant Superfund Ruling: 9th Circuit Rejects De Minimis CERCLA Settlements

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Over a strong dissent, the U. S. Court of Appeals for the Ninth Circuit rejected the lower court's approval of several proposed de minimis consent decree settlements. The Arizona Department of Environmental Quality (ADEQ) had negotiated these settlements with a number of potentially responsible parties ("PRPs") at the Broadway-Patano Landfill, a former hazardous waste site located in Tucson, Arizona; the site is being cleaned up at an expected cost of $75 million. Several parties claiming to be de minimis PRPs approached the ADEQ seeking early settlements of their alleged liability. Their allocations at the site ranged from 0.01% to 0.2% of the overall liability, and the ADEQ's review of the record agreed with these conclusions. A proposed Consent Decree was filed with the U.S. District Court for Arizona. Although opposed by many intervenors, the court approved the Consent Decree. An appeal followed; the case is State of Arizona v. Raytheon, et. al., decided August 1, 2014.

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The ADA and Private Professional Certification

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By Pillsbury Winthrop Shaw Pittman

Today, Pillsbury attorneys Jerry Jacobs, Julia Judish, Dawn (Crowell) Murphy and Chris Leuchten issued their advisory titled The ADA and Private Professional Certification. Their Advisory discusses Title III of the Americans with Disabilities Act (ADA), as amended, which mandates that private entities offering examinations or courses related to certain applications, licensing, certification, or credentialing ensure that such exams and courses are accessible to individuals with disabilities or offer alternative accessible arrangements. They encourage those involved with any aspect of credentialing examinations to pay careful attention to what aids or accommodations must be offered by law.

If you have any questions about the content of this blog, please contact the Pillsbury attorney with whom you regularly work or Jerry Jacobs, Julia Judish, or Dawn (Crowell) Murphy, the authors of this blog.

Zurich Seeks to Assert Unprecedented Control over Defense Counsel

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Zurich has updated its "Litigation Management Guidelines" to give the insurer an unprecedented level of control over defense counsel's activities. The new Guidelines adopt the Recommended Case Handling Guidelines for Insurers created by The Defense Research Institute, and also append an extensive Addendum covering business policies, expense and professional fee payment, and other administrative points.

The Guidelines purport to impose a sweeping waiver of attorney-client privilege and work product protection, even though the law in most states imposes significant limitations on an insurer's access to privileged or protected information developed by defense counsel - especially where the insured is entitled to so-called Cumis or independent counsel as a result of conflicts of interest with its insurer. Zurich's Guidelines mandate almost complete and constant transparency in case development and strategy, stating "counsel should provide a significant development report to immediately communicate important case developments to the claims professional, such as settlement overtures by other parties, codefendant strategies or developments, new information obtained through discovery, etc." The Addendum also requires counsel to "enunciate the impact of the information being conveyed," specifically on "case strategy, evaluation, posture, and resolution opportunities." Zurich essentially attempts to coerce insureds to waive the attorney-client privilege and work product protection by expressly stating that Zurich reserves the right to review defense counsel's files and will not pay for defense activities for which Zurich is not given access to "full" explanation and documentation.

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Ohio Supreme Court Announces Rule for Pay-if-Paid Provisions

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Last month, in its decision in Transtar Electric, Inc. v. A.E.M. Electrical Services, Corp., Slip Opinion No. 2014-Ohio-3095, the Ohio Supreme Court ruled that the inclusion of term "condition precedent" in a contractual payment provision was an explicit statement of the parties' intent to transfer the risk of the project owner's non-payment from the general contractor to the subcontractor. This decision is significant for Ohio, a state that enforces the validity of pay-if-paid provisions, unlike other states that have found them void as against public policy.

Transtar involved a contract between a general contractor and an electrical subcontractor for the construction of a pool at a Holiday Inn. The subcontractor fully performed its work under the subcontract, but the general contractor failed to pay the last three of the subcontractor's invoices because the owner had not paid the general contractor for the work reflected in those invoices. The subcontractor filed suit alleging both breach of contract and unjust enrichment, and both sides moved for summary judgment. While the general contractor did not dispute the facts asserted by the subcontractor, it argued that, under the contract, it did not have to pay the subcontractor until it received payment from the owner. The trial court agreed with the general contractor, but the appeals court reversed, stating that the contract's payment provision was not sufficient to shift the risk of non-payment by the owner to the subcontractor. The Ohio Supreme Court then reinstated the judgment of the trial court.

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Significant 5th Circuit Ruling On Preenforcement Clean Water Act Review Under US v. Sackett, Holding Corps of Engineers' Judicial Determination Not A Final Agency Action

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In the case of Belle Company, L.L.C., et al., v. U.S. Army Corps of Engineers, decided July 30, 2014, the US Court of Appeals for the Fifth Circuit affirmed the lower court's decision to dismiss a lawsuit challenging the Corps issuance of a wetlands jurisdictional determination (JD) on several grounds.

The New Orleans District Office issued a JD that Belle's property, intended to be used as a solid waste landfill, contained wetlands subject to the Corps' Clean Water Act § 404 permitting jurisdiction. Belle argued that this determination reflected an illegal change in administrative policy, and the Corps' administrative appeals process deprived Bell of its liberty and property interests without due process of law. In the main, however, Belle argued that the precedent established by the US Supreme Court in Sackett v. EPA, 132 S. Ct. 1367 (2012), required the courts to revisit the issue of final agency action for purposes of the judicial review of agency actions. The Sackett case involved an EPA compliance order under the CWA involving consequences that were so serious and final as to warrant pre-enforcement judicial review.

The Fifth Circuit, applying the Sackett decision to the consequences of a Corps' JD, determined that while the JD represented the consummation of the Corps' decision-making process as to the question of its jurisdiction under the CWA, it was still "nonfinal and nonreviewable" because it did not, in itself, adversely affect the complainant--it was only a threshold determination. Therefore, it was not a final agency action subject to judicial review at this time. The Fifth Circuit noted that the issuance of a notice of violation by EPA under the Clean Air Act was recently held by a panel of the Fifth Circuit not to be a final agency action in Luminant Generation Co., L.L.C. v. EPA, ___ F.3d ___, Nos. 12-60694, 13-60538, 2014 WL 3037692, at *3 (5th Cir. 2014). It concluded that to hold otherwise in this case would undermine the current complicated and sophisticated system used by the Corps by which property owners can ascertain their rights and obligations before they are subject to any enforcement action under the CWA.

The Fifth Circuit also turned aside Belle's constitutional due process challenge filed under 28 U.S.C. § 1331 because a waiver of sovereign immunity had not been established, and a challenge to the Corps' use of a new policy regarding the regulatory status of prior converted cropland. Belle argued in this instance that the new policy was formulated by the Jacksonville, Florida office of the Corps without APA-required notice and comment, but the Fifth Circuit noted there was no evidence in the record that the New Orleans office relied on this policy--and the applicable statute of limitations had expired.

CA: Public Works Contractors Online Application System

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Recently enacted law establishes a new public works program to replace the Compliance Monitoring Unit and Labor Compliance Program requirements for bond-funded and other public works projects. Effective July 1, 2014, the California Department of Industrial Relations' (DIR) program covers all bond-funded and public works projects in the state rather than just selected processes. Public works refers to construction, alteration, demolition, installation, or repair work (including maintenance) done under contract and paid by public funds. It does not include those done by a public agency with its own employees. With minor exceptions, all workers employed on public works projects must be paid the prevailing wage determined by the Director of the DIR according to the type of work and location, and the prevailing wage rates are usually based on rates specified in collective bargaining agreements.

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CSLB: California 2014 Legislative Bills That Could Impact Contractors

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UPDATE: September 17, 2014, Governor signs into law SB 315

The California Contractors State License Board (CSLB) monitors legislation that it is sponsoring as well as bills that may have an impact on the construction industry. In its Summer 2014 Newsletter, the CSLB identifies a handful of bills that it is watching.

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Minnesota Minimum Wage Increase ~ August 1, 2014, 2015, 2016 and Beyond

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A Minnesota bill contemplating minimum wage increases (Minnesota H.F. 2091) was signed into law on April 14, 2014, and is effective August 1. It contemplates minimum wage increases commencing on August 1 and continuing thereafter.

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CSLB Enforcement Division Reinforcing HVAC Scam Zero-Tolerance Policy

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In the California Contractors State License Board's (CSLB) Summer 2014 Message from the Board Chair, the CSLB's new Board Chair David Dias voices his concern about the increasing number of consumer complaints alleging predatory practices by C-20 Warm-Air Heating, Ventilating and Air-Conditioning (HVAC) contractors. Reportedly, vulnerable consumers are being taken advantage of after calling an HVAC contractor for simple repairs or routine maintenance. He confirms that the CSLB is "taking steps to warn and weed out this element," efforts which have included hosting a conference in San Jose in May that brought together industry officials, regulators, and C-20 contractors to discuss HVAC installation-related issues. He further confirmed that the CSLB's Enforcement Division "will be reinforcing its HVAC scam zero-tolerance policy through targeted undercover sting operations."

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7th Circuit Rejects Substantive Due Process Challenge to Wisconsin Supreme Court Special Tort Liability Doctrine

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In an unusual case, the US Court of Appeals for the Seventh Circuit held, in Gibson v. American Cyanamid Co., et al., that the Wisconsin Supreme Court's "risk contribution theory" would apply to the manufacturers of lead pigments that were added to commercial paint products until their use was banned in 1978 by the Consumer Product Safety Commission.

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