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Today, Pillsbury attorneys Jim Chudy and Brian Wainwright published their advisory titled Five Facts About the Tax Increase Prevention Act of 2014. The Advisory provides an overview of the Tax Increase Prevention Act of 2014 (Division A of H.R. 5771), signed into law by President Obama on December 19, 2014, an Act that extends many tax provisions that had expired at the end of 2013.

If you have any questions about the content of this blog, please contact the Pillsbury attorney with whom you regularly work or Jim Chudy or Brian Wainwright, the authors of this blog.

Recently, Pillsbury attorneys Chris Wall, Steve Becker, Nancy Fischer, Aaron Hutman and Stephanie Rohrer published their advisory titled A New U.S. Course for Cuba Relations: What Does It Mean for Business? The Advisory discusses President Obama’s unexpected announcement signaling a “new course” for Cuba after more than 50 years of comprehensive U.S. sanctions, and possible opportunities for certain exports markets including telecommunications, building materials, agricultural equipment, and certain goods for use by Cuban entrepreneurs.

If you have any questions about the content of this blog, please contact the Pillsbury attorney with whom you regularly work or Chris Wall, Steve Becker, Nancy Fischer, Aaron Hutman or Stephanie Rohrer, the authors of this blog.

In Cincinnati Ins. Co. v. AMSCO Windows, No. 13-4155, 2014 WL 6679589, at *3 (10th Cir. Nov. 26, 2014), the United States Court of Appeals, Tenth Circuit, held that construction defects brought against a window manufacturer (“AMSCO”) were “occurrences” as defined under the manufacturer’s Commercial General Liability (“CGL”) policies and, therefore, those CGL policies provided coverage for those claims.

In our experience, when courts follow the minority and find that manufacturing or construction defects cannot be an occurrence under a CGL policy, they often rotely apply what they see as precedent, instead of carefully analyzing the policy language and the facts. Here, both the district court and the Tenth Circuit give us a refreshing and thoughtful analysis into this issue. Read about it after the jump.
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On October 24, 2014, the D.C. Circuit rejected a challenge to the revised OSHA Hazardous Communication Standard insofar as it applies to “combustible dust”. The case is National Oilseed Processors Association, et al., v. Occupational Safety & Health Administration, et al. The Standard was substantially revised in 2012 to conform with the Globally Harmonized System, a uniform international chemical labeling system. The Hazard Communication, 77 Fed. Reg. 17,574 (Mar. 26, 2012) (“Final Rule“) designated “combustible dust” as a hazardous chemical subject to the Standard, although OSHA has yet to develop a workplace standard addressing the hazards of combustible dust in the workplace. This decision may be of interest to all manufacturers and employers subject to the Hazard Communication Standard; it places in context the development of the rule over the past 30 years, and demonstrates again how difficult it is to have such rules overturned.

The National Oilseed Processors Association includes in its membership the owners and operators of grain handling businesses who have a keen interest in this new standard. The Association argued, and the court rejected, contentions that it was not provided adequate notice of the inclusion of combustible dust in the rule, that OSHA’s decision was not supported by substantial evidence as the statute requires, and that their constitutional Due Process rights were violated in that the agency, by failing to define “combustible dust”, did not provide fair warning of the agency’s enforcement measures.

Additional Sources: OSHA Fact Sheet Hazard Communication Standard Final Rule

UPDATE:  The Sacramento Bee, Marcos Breton: Selling a new image of Sacramento (Oct. 17, 2015)

UPDATE: Sacramento Business Journal, CEO-led economic development group searches for leader (Jul. 23, 2014)

The Sacramento Business Journal recently reported that Up to 40 CEOs back new business recruitment effort for the capital region. The recently formed Greater Sacramento Area Economic Council reportedly “will be modeled after an economic development group in Phoenix that has made several trips to Sacramento to talk to various stakeholder groups.” The new council is expected to attend national and international business recruitment events to sell Sacramento along and to utilize other methods of actively recruiting Sacramento business.

What would it take for you to join us here in the capital region?

Additional Source: The Sacramento Bee, CEO group plans Sacramento economic development push (Jun. 24, 2014)

Photo: Bev Sykes, State Capitol, Sacramento (Dec. 11, 2003) – Creative Commons

Recently, Starbucks has been in the news for “giving its baristas a shot at an online college degree.” Starbucks has reportedly team upped Arizona State University to offer certain of its employees access to an online undergraduate degree available at a steep discount (the “Starbucks College Achievement Plan”). Starbucks and ASU News reported that “Through this innovative collaboration, partners based in the United States working an average of 20 hours per week at any company-operated store (including Teavana®, La Boulange®, Evolution Fresh™ and Seattle’s Best Coffee® stores) may choose from more than 40 undergraduate degree programs taught by ASU’s award-winning faculty, such as electrical engineering, education, business and retail management.”

Starbucks and ASU News also confirmed that the Starbucks College Achievement Plan contemplates that “Partners admitted as a junior or senior, according to ASU’s admission requirements, will earn full tuition reimbursement for each year of coursework they complete toward a bachelor’s degree. Freshmen and sophomores will receive a partial scholarship and need-based financial aid toward the foundational work of completing their degree. Partners will have no commitment to remain at Starbucks past graduation.” According to Starbucks and ASU News, “Partners will have no commitment to remain at the company past graduation.” In addition to its financial support, Starbucks and ASU reported “Partners will have a dedicated enrollment coach, financial aid counselor and academic adviser to support them through graduation,” and the program “will also include adaptive learning services to help students progress at the right pace for them; networking and community-building opportunities; and additional resources to help students plan their educations.”

Additional Sources: Starbucks, Starbucks College Achievement Plan; ASU News, Starbucks, ASU team up for employee education program; ABC News, Starbucks Clears College Degree Path for Workers; USA Today, Starbucks offers workers free college tuition; Wall Street Journal, Starbucks to Subsidize Workers’ College Degrees

The Supreme Court has issued its decision in the case of CTS Corp. v. Waldburger, et al., __ S. Ct. __ (June 9, 2014), argued April 23, 2014.

The Court (Justice Kennedy) reversed the Fourth Circuit, which had held that CERCLA Section 9658 also preempted state “statutes of repose” as well as state statutes of limitations. Section 9658 was added to CERCLA in 1986. CTS operated an electronics manufacturing plant in North Carolina until 1987, when it was sold as being “environmentally sound”. In 2011, the plaintiffs in this case filed a lawsuit in federal court alleging that CTS’ operations had released hazardous substances that contaminated the property they had more recently purchased. CTS argued before the district court that North Carolina’s 10 year statute of repose required the dismissal of their lawsuit, and the court agreed. However, the Fourth Circuit disagreed, holding CERCLA Section 9658 also preempted this North Carolina law.

The Court granted a petition for certiorari because there were some conflicting interpretations of Section 9658 by the courts of appeal. In reversing the court of appeals (the vote was 7 to 2, with Justices Ginsberg and Breyer dissenting), the Court subjected Section 9658 to a thorough textual analysis and determined that Congress had not clearly provided that state statutes of repose were preempted by CERCLA, and so the majority concluded that state statutes of repose were not included in the preemptive effect of Section 9658. This was particularly important because, as the Court noted a few years ago, the states were “independent sovereigns in our federal system” and “the historic police powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress.” The dissenters stated that the Court’s decision gives “contaminators an incentive to conceal the hazards they have created until the repose period has run its full course”.

If you have any questions about the content of this blog, please contact the Pillsbury attorney with whom you regularly work or Anthony Cavender, the author of this blog.

Rod Mutch, Chief Electrical Inspector for the Washington State Department of Labor & Industries, announced his decision to step down as Chief Electrical Inspector for the Department effective June 1, 2014. He confirmed that he will remain with the Department and will be working in the Department’s Yakima office.

Until a permanent chief electrical inspector is appointed, Larry Vance has agreed to serve as interim Chief Electrical Inspector for the Department. Larry Vance has been working as an Electrical Technical Specialist in the electrical program since November 2007with brief periods where he served as the Electrical Inspection Field Supervisor in Tacoma and interim Electrical Program Manager and Chief Electrical Inspector, and he has 18 years of electrical experience in the private sector of the electrical construction industry.

Best wishes, and thank you for your service.

Remember when Sheldon and Leonard played giant JENGA on Big Bang Theory? Cat Products took the game to the next level at the Caterpillar Testing Facility. Built for It Trials — Stack: Largest JENGA Game Played With Cat Excavators

Virginia’s 2014 General Assembly approved an increase in the civil penalty imposed when an employer fails to properly insure, as required by the Workers’ Compensation Act. Amendments to Section 65.2-805 expose an employer in violation of this law to a civil penalty of not more than $250 per day for each day of noncompliance, subject to a maximum penalty of $50,000, plus collection costs. The amendments are effective July 1, 2014.

As summarized by the Virginia Workers’ Compensation Commission, Virginia law requires an employer to insure in Virginia when they regularly employ more than two part-time (or full-time) employees. In addition, a business that hires subcontractors or another business(es) to assist it in its trade or to fulfill a contract must count the subcontractor’s or other business’ employees as well as its own employees in determining the total employees for coverage requirements. It further explained that, for a contractor whose work varies, the Commission will look to the “established mode” of performing work and, a contractor that hires one or more subcontractors with employees to accomplish their business, will be required to carry workers’ compensation insurance.

It cautions employers that the term “employee” is defined broadly under Virginia law and includes every person in the service of another under any contract of hire, written or implied, lawfully or unlawfully employed, and “employee” includes statutory employees (subcontractor’s employees), corporate officers, minors, aliens, working family members, apprentices, temporary and seasonal employees; designating a worker as an “independent contractor” does not necessarily mean they are not an employee. The workers’ compensation insurance coverage requirements focus on number of employees, and a business that doesn’t count all of its employees may not realize it is required to carry coverage.

Workers’ compensation is mandatory coverage. Virginia law does not permit other forms of insurance as a substitute. Failure to properly insure due to lack of knowledge will not excuse an employer’s failure to comply with Virginia’s Act or protect the employer from civil penalties.

Virginia workers’ compensation information is available at www.workcomp.virginia.gov. For specific coverage questions, contact the Insurance Department of the Commission at vwcinsurance@workcomp.virginia.gov or by phone at (804) 205-3586.

Additional Source: Commonwealth of Virginia, Virginia Workers’ Compensation Commission, Important Notice for Employers