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Discovering the Cloud – Issues to Consider Before Storing on the Cloud

By: Sean Perryman Cloud computing can provide enormous benefits to some companies, but only if risks and expenses are evaluated in advance. Businesses increasingly rely on cloud computing to store documents and information. Through third-party service providers, the cloud can reduce IT management and maintenance costs, presumably maximizing operational efficiency. Companies considering moving data to the cloud typically believe these financial and operational benefits outweigh the risks. While the media has focused on security risks, litigation and discovery complications may prove even riskier factors to a third party storing and preserving your company?ÇÖs data. Normal discovery rules may apply to the cloud Sophisticated organizations recognize the duty to preserve relevant information in anticipation of litigation. They have in place litigation holds and other procedures to address this duty. As businesses transition to storing data in the cloud, they should implement similar document retention procedures. Federal Rule of Civil Procedure 34… Continue Reading

Peeved with Biebs: Justin Bieber Sued over Joustin?ÇÖ Beaver Game App

Last Friday, app developer RC3, Inc. sued Biebs, aka pop star Justin Bieber, seeking the court?ÇÖs declaration that RC3?ÇÖs game ?Ç£Joustin?ÇÖ Beaver,?Ç¥ available for Android?ádevices and the iPhone/iPad, is protected under the First Amendment.?á In a February 13, 2012 demand letter to RC3, Bieber?ÇÖs counsel asserted that the app is a blatant infringement of Bieber?ÇÖs right of publicity and constitutes trademark infringement, trademark dilution, and other violations. The game features a beaver sporting Bieber?ÇÖs (in)famous hairstyle.?á The beaver also wears a purple sweater which, as every Bieber fan knows, is his favorite color.?á (Important! ?áWe don?ÇÖt admit to being Bieber fans.)?á Joustin?ÇÖ Beaver must float down the river while signing ?Ç£Otter-graphs?Ç¥ and knocking evil ?Ç£Phot-Hogs?Ç¥ into the river with his jousting lance. A press release for the game noted, ?Ç£We wanted to create a game that appeals to Justin Bieber?ÇÖs fans.?á He?ÇÖs a hero and adored by millions.?á It?ÇÖs important… Continue Reading

SEC Updates CD&Is Re: Advisory Votes on Executive Compensation

The Securities and Exchange Commission posted examples of advisory vote descriptions that would be (or would not be) consistent with the requirement that shareholders be given an advisory vote to approve the compensation paid to a company?ÇÖs named executive officers, as disclosed pursuant to Item 402 of Regulation S-K. For example, on its proxy card, the company can describe the advisory vote as ?Ç£Advisory vote to approve named executive officer compensation,?Ç¥ but not ?Ç£To hold an advisory vote on executive compensation,?Ç¥ because the latter description is ambiguous. The SEC regularly posts questions and answers with its interpretations of the registration and reporting provisions of Sections 12, 13 and 15 of the Exchange Act. The SEC?ÇÖs updated Q&A and examples can be found here.

Deadline to Adopt Pre-Approved Defined Benefit Plans

In its recent newsletter to retirement plan sponsors, the IRS reminded employers that use preapproved defined benefit plan documents that they have until April 30, 2012, to sign and date documents that have been updated for EGTRRA, to be eligible for retroactive remedial amendment and reliance. Failure to adopt an updated defined benefit plan by April 30 may cause the plan to lose its qualified status. The April 30 deadline also applies to employers who have individually designed defined benefit plans and have signed Form 8905, Certification of Intent to Adopt a Pre-Approved Plan, before the end of the plans?ÇÖ five-year remedial amendment cycle. A copy of the IRS newsletter can be found here.

Final Rules on Health Plan Coverage of Preventative Services Issued

The U.S. Departments of Treasury, Labor and Health and Human Services issued final regulations on the health reform requirement that non-grandfathered health plans and health insurance issuers provide first-dollar coverage for certain preventive health services, including, but not limited to, all Food and Drug Administration approved contraceptive methods, sterilization procedures and patient education and counseling for all women with reproductive capacity. These regulations finalize, without change, the interim final regulations?ÇÖ exemption that allows certain religious employers from having to provide coverage for certain preventive health services. A copy of the final regulations is available here.

British High Court Permits Service Via Facebook: Will U.S. Courts Follow?

By Nick Nelson The Associated Press reports that a High Court Judge in England last week approved the use of Facebook to serve legal documents on a defendant in a commercial dispute. According to the report, the plaintiffs had attempted to serve the defendant at his last known address, but it wasn?ÇÖt clear whether the individual was still living there.?á The defendant?ÇÖs e-mail address was also unknown. Attorneys for the plaintiffs told the High Court that there was evidence that the defendant?ÇÖs Facebook account, on the other hand, was active ?Çô he had just recently accepted two new friend requests. Under these circumstances, Justice Nigel Teare granted the plaintiffs?ÇÖ request to serve the defendant via Facebook.?á According to Jenni Jenkins, an attorney for plaintiffs who was quoted by the Associated Press, the defendant was given extra time to respond to the claim ?Ç£to allow for the possibility that he wasn?ÇÖt… Continue Reading

United Kingdom: Auto-Enrollment Deadlines Delayed for Medium and Small Employers

Employers in the UK with 250 or more employees will begin auto-enrolling employees in workplace pensions starting in October of this year. However, the dates have been delayed for medium and smaller employers: employers with 50 to 249 employees will begin in April 2014; employers with 30 to 49 employees will begin in August 2015; and employers with less than 30 employees will begin in January 2016. The full schedule can be found here.

PBGC Announces Relief Window for Delinquent Plans with Unpaid Premiums

On February 9, 2012, the Pension Benefit Guaranty Corporation (?Ç£PBGC?Ç¥) announced a limited voluntary compliance window for covered defined benefit plans that have never paid required premiums to pay past due premiums without penalty. PBGC will waive premium payment penalties as well as information penalties for failure to timely file premium information. The relief, however, does not apply to late payment interest charges. To obtain relief, the plan administrator must (i) contact PBGC by July 31, 2012 and (ii) pay all past-due premiums and file required premium information by August 31, 2012. PBGC has indicated that after the end of this voluntary compliance period, it intends to step up its enforcement efforts. For any covered plan that has never paid PBGC premiums, the penalties can be quite substantial. A copy of PBGC?ÇÖs policy statement can be found here.

IRS Releases Revenue Ruling Addressing Application of QJSA and QPSA Rules for Deferred Annuity Contracts under a Profit-Sharing Plan

In Revenue Ruling 2012-3, the IRS describes the application of the qualified joint and survivor annuity (?Ç£QJSA?Ç¥) and qualified preretirement survivor annuity (?Ç£QPSA?Ç¥) rules in the context of a deferred annuity contract purchased under a profit-sharing plan which absent the purchase of a deferred annuity contract would not otherwise be subject to the QJSA or QPSA rules . The Revenue Ruling sets forth three scenarios involving a profit-sharing plan that offers a deferred annuity contract with varying election options and discusses whether each of the scenarios qualifies for the exception under Code Section 401(a)(11)(B)(iii) from the application of the QJSA and QPSA requirements and when such exception is lost with respect to a participant under certain scenarios. This is part of the lifetime annuity initiative from the IRS and Treasury to encourage annuitization of plan benefits, yet adding the annuitization to a profit sharing plan that is otherwise exempt from… Continue Reading

Recent NLRB Social Media Report Raises New Questions

As we have detailed in this blog and elsewhere, the National Labor Relations Board (?Ç£NLRB?Ç¥ or the ?Ç£Board?Ç¥) made social media cases a priority in 2011.?á As demonstrated in a recent memorandum released by the Board?ÇÖs Acting General Counsel, this trend is set to continue in 2012.?á Memorandum OM 12-31 summarizes 14 recent social media complaints received by the Board, and details the General Counsel?ÇÖs conclusions on each case.?á While the report reiterates many of the Board?ÇÖs previous pronouncements regarding social media, it also raises new questions about employer regulation of employee social media use, as well as permissible social media policy language.   A New Standard to Evaluate Employee Social Media Comments? Section 7 of the National Labor Relations Act (?Ç£NLRA?Ç¥) gives employees the right, among other things, ?Ç£to engage in . . . concerted activities for the purposes of collective bargaining or other mutual aid or protection?Ç¥ (emphasis… Continue Reading

February 2012