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L to R: Keegan Federal & Mauricio Dávalos - Mira Avocado Oil - Business luncheon with representatives from Uyamá Farms, MirAmerica and Corporacion Financiera Nacional in Quito, Ecuador
Acting as legal counsel for MirAmerica, Inc., Keegan Federal of Federal & Hasson, LLP, traveled to Quito, Ecuador to assist co-founder, Ray Reyes, in finalizing the exclusive distribution agreement for Mira® avocado cooking oil in the United Sates.
Mira® avocado cooking oil is a product of Uyamá Farms S.A. The company's president, Mauricio Dávalos, is the former Minister of Agriculture for Ecuador (2000), Minister of Coordination for Economic Policy and Production (2007), and most recently a member of Ecuador’s Foreign Relations Advisory Board. Dávalos, a true visionary in the realms of business and economics, founded and managed AgroFlora S.A. and Queenroses S.A., the forerunners of Ecuador’s international floral industry. The Mira® avocado line is the most recent success of Dávalos.
Accompanying the business team, were renowned chef and author, Nathalie Dupree. Twice the recipient of the coveted James Beard award, head chef for three restaurants (one in Majorca, Spain), and author of ten cookbooks, Dupree generously agreed to join the business party to share her insight with Uyamá Farms and MirAmerica regarding the introduction of the avocado oil to the American consumer market and the restaurant industry. The five-day business trip was beautifully documented by Charleston's, Sarah Bates, photographer and multimedia artist.
As guests of Mauricio and Rita Dávalos, the business party was royally treated to an amazing panoply of Ecuadorian history and culture. Some of the highlights included: a horseback tour of the avocado orchards, an inspection and “tasting” at the cold-press oil production and packaging facility, a trip to the bustling Otavalo art market, and the chance encounter of the Festival of Santa Rosa in a tiny village outside of the city of El Angel in the magnificent Ecuadorian highlands of Carchi Province.
While in Quito, in addition to business meetings with Uyamá Farms, and Ecuadorian financiers from CFN (Corporacion Financiera Nacional), there were days filled with touring Quito and the surrounding regions north and south. Points of interest included the UNESCO Heritage site of Old Colonial Quito, shopping for traditional folk art, sampling fine Ecuadorian cuisine, and a visit to El Mitád del Mundo (the Middle of the World -O° O' O " longitude, and 78° 27' 20" latitude).
Through Federal & Hasson’s contacts within the Georgia Hispanic Chamber of Commerce, Mexican American Business Chamber, Hispanic Contractor’s Association of Georgia, and with colleagues like El Club Commerciantes and others, the law firm of Federal & Hasson continues to expand its international practice to the Hispano-Americano market. Should you require additional information regarding the firm and the services we provide, or if you have an urgent legal need, we would be honored to help you. Please contact us at 678.443.4044. |
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“Trial By Jury: What’s the Big Deal?” is an animated educational presentation for high school civics classes in Georgia to increase court literacy among young people. This presentation was created to be used by high school civics teachers as a tool in fulfilling four specific requirements of the Social Studies Civics and Government performance standards.
This animated presentation reviews the history and importance of trial by jury through a discussion of the Magna Carta, the Star Chamber, the trial of William Penn, the Constitutional Convention in 1787, the Constitution and the Bill of Rights. Also covered in the presentation are how citizens are selected for jury duty, the role of a juror, and the importance of an impartial and diverse jury.
The State Bar of Georgia’s Law-Related Education Program offers several other opportunities for students and teachers to explore the law. Students can participate in Journey Through Justice, a free class tour program at the Bar Center, during which they learn a law lesson and then participate in a mock trial. Teachers can attend free workshops correlated to the Georgia Performance standards on such topics as the juvenile and criminal justice systems, federal and state courts, and the Bill of Rights. The LRE program also produces the textbook An Introduction to Law in Georgia for use in middle and high school classrooms.
You may view “Trial By Jury: What’s the Big Deal?” at www.gabar.org/cornerstones_of_freedom/civics_video/.
For a free DVD copy, e-mail
This e-mail address is being protected from spambots. You need JavaScript enabled to view it
or call
404-527-8792. For more information on the LRE Program,
contact Deborah Craytor at
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or
404-527-8785. |
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Today, it is commonplace for workers to handle both work and caregiving responsibilities for spouses and children, parents and other older family members, or relatives with disabilities. Women still are disproportionately more likely to exercise primary caregiving responsibilities but, in increasing numbers, men also have assumed the dual roles of caretaker and breadwinner.
Our society may be evolving toward more individuals simultaneously sharing the duties of an employee and a caregiver, but old stereotypes in the workplace sometimes die hard. The result is a steady rise in claims of employment discrimination based on what is sometimes called “family responsibility discrimination.” You would search in vain for a federal law that expressly prohibits discrimination at work against caregivers, but complaining employees have been able to pursue claims under other employment discrimination statutes, such as Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act (ADA), and the Family and Medical Leave Act (FMLA).
The cases brought under Title VII tend to allege sex discrimination or gender stereotyping. A classic example is the pregnant woman who is let go or passed over for a promotion because the employer's decisionmaker assumes that with the baby will come a diminished commitment to the employer and a failure by the employee to meet all of the obligations of her job. Such was the case in a recent litigation in which a mother of triplets was denied a promotion because, in the employer's words to her, “you have a lot on your plate right now.” When a federal appellate court reinstated the lawsuit after its dismissal by the trial court, the employer likely came to the belated conclusion that it should concern itself only with the employer's portion of the employee's “plate.”
The ADA can come into play as a vehicle for caregiver discrimination claims because the phrase “discriminate against a qualified individual on the basis of disability” in the statute includes “excluding or otherwise denying equal jobs or benefits to a qualified individual because of the known disability of an individual with whom the qualified individual is known to have a relationship or association.”
The FMLA may be the existing federal statute that by its terms most directly addresses caregiver rights in employment, but it affords employees more restricted protection than do Title VII and the ADA. The FMLA provides that covered employers (private sector employers with at least 50 employees in a 75 mile radius) must provide up to 12 weeks of unpaid medical leave during a 12 month period to eligible employees (those who have worked for the employer for at least 12 months or 1,250 hours) for childbirth and newborn care, adoption or foster care placement, care for immediate family members with a serious health condition, or to handle the employee's own serious health condition.
In its recently published guide to the best practices for employers on this subject, the Equal Employment Opportunity Commission (EEOC) touts the benefits and advantages of employers adopting flexible workplace policies that help employees achieve a satisfactory work life balance. According to the EEOC, employers taking that approach may not only experience decreased complaints of unlawful discrimination but, according to many studies, may also benefit their workers, their customer base, and even their financial picture. Flexible workplace policies also aid recruitment and retention efforts, helping employers to keep a talented, knowledgeable workforce and save the money and time that would otherwise have been spent recruiting, interviewing, selecting, and training new employees.
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Nicole discovered that someone with a name very similar to hers had stolen her identity and opened fraudulent accounts in her name and under her Social Security number. This was only the beginning of a long and arduous saga in which she took all of the recommended steps to rectify the problem, but nonetheless was beset by financial and emotional stresses over several years before the matter was finally resolved. Ultimately, she secured some relief in the form of a substantial jury verdict against a credit reporting firm. The firm bore no responsibility for the identity theft itself, but it had repeatedly compounded the impact of the theft by mishandling information about Nicole. Nicole sued the firm under the federal Fair Credit Reporting Act (FCRA).
Although it did not do so intentionally, the credit reporting firm had caused Nicole's ordeal to be more protracted, and to have more consequences for her finances and general well being, by mistakenly putting her address and Social Security number on credit files set up by the identity thief. What is worse, the firm did this a few times over several years, even after having been informed of the problem. Because of the erroneously adverse credit files, Nicole was sometimes denied credit, such as for a home mortgage. On other occasions, she was offered credit only on very disadvantageous terms because she was perceived as such a high risk. Nicole did have some previous credit problems of her own making, but the “infection” of her credit information by the files created by the identity thief made her look even worse to lenders.
A key issue in the firm's unsuccessful appeal from the jury verdict was whether Nicole had shown enough to recover a large sum not just for out of pocket losses, but also for emotional distress. The federal appellate court left the verdict undisturbed. The jury had not indicated what portion of its total award was attributable to emotional injuries, but, in any case, the court was satisfied that the award was not excessive in light of the evidence offered at trial.
Nicole had been made to spend literally hundreds of hours, often while having to miss work, trying to undo the tangled mess created by the firm. The record showed that as she dealt with the credit reporting service and tried to cope with the rippling effects of its errors, Nicole often was uncharacteristically upset with friends, family members, and co workers. She was beset by frequent headaches, sleeplessness, and even such symptoms as bad skin and hair loss. In short, Nicole became a wreck emotionally and even physically. For its role in causing it all, the credit reporting firm had to pay.
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In October 2008, Congress increased the basic limit on federal deposit insurance coverage from $100,000 to $250,000. The limit is scheduled to return to $100,000 on January 1, 2014.
The temporary limit now in effect has not changed the fact that a customer has various means by which to effectively raise the applicable limit for the customer's collection of deposits at any one institution. The basic limit applies separately to different ownership categories. A single account in one name is insured up to $250,000; a joint account for two or more people is insured up to the same limit, per owner; certain retirement accounts, such as IRAs, are covered up to the limit; and deposits meant to pass on to named beneficiaries on the death of the owner can be protected up to $250,000 for each named beneficiary. This last category of deposits is a revocable trust account.
There also are other recent changes that favor depositors in insured institutions. For example, it used to be that the only beneficiaries under a revocable trust account who qualified for additional deposit insurance coverage were the account owner's spouse, child, grandchild, parent, or sibling. Now an account owner can name almost any beneficiary, such as a more distant relative, a friend, or a charitable organization, and each beneficiary will still benefit from the additional coverage.
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The federal Fair Labor Standards Act (FLSA) provides that employers may not require their employees to work more than 40 hours per workweek unless those employees receive overtime compensation at a rate of not less than one and one half times their regular pay. The FLSA contains certain exemptions from the overtime compensation requirement, one of which is for employees working in a “bona fide executive, administrative, or professional capacity.” In other words, if an employee works in such a capacity, the employer is exempt from the general requirement of paying overtime pay. Under the FLSA regulations, an employee's position must satisfy three tests to qualify for this exemption: (1) a duties test, (2) a salary level test, and (3) a salary basis test.
The issue before a federal appeals court recently was whether the compensation plans used for management level employees of a health club chain satisfied the salary basis test.
Under its bonus plan, in particular, the employer could deduct bonus plan “overpayments” if an employee did not meet certain performance levels. The legal outcome for the employees was affected by the time frame in which the compensation plan was in effect. For the period after August 23, 2004, when a new Department of Labor regulation on the salary basis test went into effect, employees were entitled to compensation for pay periods in which actual deductions from pay were made. The regulation provided that “[a]n actual practice of making improper deductions demonstrates that the employer did not intend to pay employees on a salary basis.”
Other employees also were entitled to overtime compensation for some pay periods before the regulation's effective date, even when the employer made no actual deductions, but the employer had in place a policy that made such deductions significantly likely to occur. Under a then controlling United States Supreme Court ruling, an employee was not paid on a salary basis, and thus was eligible for overtime compensation, if (1) there was an actual practice of salary deductions, or if (2) an employee was compensated under a policy that clearly communicated a significant likelihood of deductions.
In the case before the court, the policy fit within the “significant likelihood of deductions” category. The employer's compensation plan targeted specific members of management; its policy set out a particularized formula whereby their pay would be in jeopardy; the employer took affirmative steps to demonstrate that the pay deduction plan would be enforced (including the creation of a “performance pay committee” that made the case by case decisions); and it took actual deductions from employees' salaries not long after the employees stopped meeting their performance goals.
Employers desirous of avoiding a similar outcome, in which overtime pay ultimately is owed to employees generally considered by the employer to have been “salaried employees,” should be cautious about making any alterations to the predetermined pay for such employees. An employee will be considered to be paid on a “salary basis” within the meaning of the regulations only if the employee regularly receives a predetermined amount constituting all or part of the employee's compensation, and such amount is not subject to reduction because of variations in the quality or quantity of the work performed.
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As the name implies, a charitable remainder trust involves the transfer of assets to a trust with the income going to an individual or individuals (which can include the owner of the assets) and with a charity receiving the assets at the expiration of the trust period. Such a trust device benefits the individuals who are the objects of the property owner's generosity, it transfers assets to the property owner's preferred charities, and it yields tax savings for the property owner.
If the trust is created during the property owner's life, there is a charitable tax deduction equal to the present value of the charity's remainder interest, and the transferred property will escape federal estate tax. If the trust is established under a will, the charitable tax deduction will remove the property from the taxable estate.
There can be other, not so obvious, benefits. Where appreciated assets are transferred, especially where the assets have a low cost basis and there is a likelihood that the property owner would have sold the assets at some point had he not transferred them to the trust, the property owner avoids a capital gains tax that would be imposed upon an outright sale. If the trust sells the assets, it will have no capital gains tax liability because the trust is a tax exempt entity.
If the property owner has established the trust in his lifetime, the fact that the trust can sell the property tax-free maximizes the income base for the income beneficiary, which can be the property owner himself. Moreover, if the trust is a charitable remainder unitrust (CRUT), under which the income is measured as a percentage (no less than 5% of the value of the trust property in a given year), the trust serves as a hedge against inflation for the income beneficiary because as the trust property appreciates in value the income paid out increases. This is not true under the other type of charitable remainder trust, the charitable remainder annuity trust (CRAT), under which a fixed amount of income is paid out each year.
A CRUT can be used as a retirement plan. Although a CRUT usually pays a percentage of the trust's annual value, it can provide that income distributions may not exceed the amount of income actually earned by the CRUT in a given year. Any shortfall in income can then be made up when there is sufficient income. During the property owner's preretirement years, the CRUT can be invested in growth stocks, thus producing little or no income. Upon retirement, those assets can be sold, with the proceeds invested in income producing assets that will yield the agreed upon income percentage, plus a “make up” portion to compensate for the earlier shortfalls. Thus, income distributions from a CRUT can be minimized during the preretirement years and then maximized for the retirement years.
It is important to remember that a charitable remainder trust must meet a series of technical requirements and therefore should be drafted only by an experienced professional.
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Professor Feroz H. Khan to speak in Atlanta, GA |
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Brigadier General (retired) Feroz Khan of the Pakistan Army has been hosted by Keegan Federal to speak to the Business Executives for National Security (BENS) at a private luncheon August 25. General Khan is currently a Visiting Professor of National Security Affairs at the Naval Postgraduate School. in Monterey, CA, USA.
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Read more...
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The “McDonald’s Coffee Case” and Other Fictions |
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Anecdotal descriptions of a few atypical lawsuits intended to shock or amuse the public have been the cornerstone of the business community’s anti-jury advertising and public relations campaign since the 1980s. Focusing on a few rare, anecdotal cases, instead of the majority of cases that pass through the courts each year, feeds into a false and dangerous perception that the system is overflowing with frivolous lawsuits. Often such verdicts have either been thrown out or substantially reduced by trial judges or appellate courts, which is exactly how the system is supposed to work. Yet the public is given the false impression that a plaintiff received a windfall, a defendant was financially ruined, or the system failed. This is particularly irresponsible when, as is typical, cases are not cited by name or even by date so they can be checked for accuracy. When journalists or researchers do track them down, they find in virtually every situation that such cases have been misreported and misused.
The “McDonald’s coffee” case. We have all heard it: a woman spills McDonald’s coffee, sues and gets $3 million. Here are the facts of this widely misreported and misunderstood case: Stella Liebeck, 79 years old, was sitting in the passenger seat of her grandson’s car having purchased a cup of McDonald’s coffee. After the car stopped, she tried to hold the cup securely between her knees while removing the lid. However, the cup tipped over, pouring scalding hot coffee onto her. She received third-degree burns over 16 percent of
her body, necessitating hospitalization for eight days, whirlpool treatment for debridement of her wounds, skin grafting, scarring, and disability for more than two years. Morgan, The Recorder, September 30, 1994. Despite these extensive injuries, she offered to settle with McDonald’s for $20,000. However, McDonald’s refused to settle. The jury awarded Liebeck $200,000 in compensatory damages -- reduced to $160,000 because the jury found her 20 percent at fault -- and $2.7 million in punitive damages for McDonald’s
callous conduct. (To put this in perspective, McDonald’s revenue from coffee sales alone is in excess of $1.3 million a day.) The trial judge reduced the punitive damages to $480,000. Subsequently, the parties entered a post-verdict settlement. According to Stella Liebeck’s attorney, S. Reed Morgan, the jury heard the following evidence in the case:1
- By corporate specifications, McDonald’s sells its coffee at 180 to 190 degrees Fahrenheit;
- Coffee at that temperature, if spilled, causes third-degree burns (the skin is burned away down to the muscle/fatty-tissue layer) in two to seven seconds;
- Third-degree burns do not heal without skin grafting, debridement and whirlpool treatments that cost tens of thousands of dollars and result in permanent disfigurement, extreme pain and disability of the victim for many months, and in some cases, years;
- The chairman of the department of mechanical engineering and bio-mechanical engineering at the University of Texas testified that this risk of harm is unacceptable, as did a widely recognized expert on burns, the editor in chief of the leading scholarly publication in the specialty, the Journal of Burn Care and Rehabilitation;
- McDonald’s admitted that it has known about the risk of serious burns from its scalding hot coffee for more than 10 years -- the risk was brought to its attention through numerous other claims and suits, to no avail;
- From 1982 to 1992, McDonald’s coffee burned more than 700 people, many receiving severe burns to the genital area, perineum, inner thighs, and buttocks;
- Not only men and women, but also children and infants, have been burned byMcDonald’s scalding hot coffee, in some instances due to inadvertent spillage byMcDonald’s employees;
- At least one woman had coffee dropped in her lap through the service window, causing third-degree burns to her inner thighs and other sensitive areas, which resulted in disability for years;
- Witnesses for McDonald’s admitted in court that consumers are unaware of the
extent of the risk of serious burns from spilled coffee served at McDonald’s
required temperature;
- McDonald’s admitted that it did not warn customers of the nature and extent of
this risk and could offer no explanation as to why it did not;
- McDonald’s witnesses testified that it did not intend to turn down the heat -- As
one witness put it: “No, there is no current plan to change the procedure that
we’re using in that regard right now;”
- McDonald’s admitted that its coffee is “not fit for consumption” when sold
because it causes severe scalds if spilled or drunk;
- Liebeck’s treating physician testified that her injury was one of the worst scald
burns he had ever seen.
Moreover, the Shriner’s Burn Institute in Cincinnati had published warnings to the franchise food industry that its members were unnecessarily causing serious scald burns by serving beverages above 130 degrees Fahrenheit.
In refusing to grant a new trial in the case, Judge Robert Scott called McDonald’s behavior “callous.” Moreover, “the day after the verdict, the news media documented that coffee at the McDonald’s in Albuquerque [where Liebeck was burned] is now sold at 158 degrees. This will cause third-degree burns in about 60 seconds, rather than in two to seven seconds [so that], the margin of safety has been increased as a direct consequence of this verdict.”2
Irresponsible use of anecdotal cases by “tort reform” proponents is nothing new. The case of Charles Bigbee was the “McDonald’s coffee case” of the 1980s. Ronald Reagan described Bigbee’s case in a 1986 speech as follows: “In California, a man was using a public telephone booth to place a call. An alleged drunk driver careened down the street, lost control of his car, and crashed into a phone booth. Now, it’s no surprise that the injured man sued. But you might be startled to hear whom he sued: the telephone company and associated firms!” In fact, Bigbee’s leg was severed after a car hit the phone booth in which he had been trapped. The door jammed after he saw the car coming ‚ he tried to flee but could not. The accident left him unable to walk, severely depressed and unable to work. Because the phone company had placed the booth near a known hazardous intersection, and because the door was defective, keeping him trapped inside, he sued the phone company for compensation.3 Bigbee was brought to Congress to testify. He said, “I believe it would be very helpful if I could talk briefly about my case and show how it has been distorted not only by the President, but by the media as well. That is probably the best way to show that people who are injured due to the fault of others should be justly compensated for the damages they have to live with the rest of their lives.”4 Charles Bigbee died in 1994 at age 52.
NOTES
1 Morgan, The Recorder, Sept. 30, 1994.
2 Ibid.
3 Nader & Smith, No Contest: Corporate Lawyers and the Perversion of Justice in America (1996).
4 House Committee on Banking, Finance and Urban Affairs, July 23, 1986.
Reprinted with permission of the Center for Justice & Democracy |
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