As a result of the Federal Circuit?ÇÖs decision in Secure Axcess, LLC v. PNC Bank National Association in late February, it is not likely that a flood of Covered Business Method (?Ç£CBM?Ç¥) reviews will be coming any time soon.?á By statute, CBM reviews are reserved for patents relating to ?Ç£a financial product or service,?Ç¥ and under the Federal Circuit?ÇÖs narrow reading of that statute, the number of CBM reviews will likely remain quite small relative to the number of Inter Partes Reviews (?Ç£IPR?Ç¥).?á Although relatively few in number, CBM reviews have generated a number of precedential Federal Circuit opinions recently. In Secure Axcess, the Federal Circuit reversed the Patent Trial and Appeals Board?ÇÖs (?Ç£PTAB?Ç¥) decision finding that claims relating to website authentication were eligible for CBM review.?á No. 16-1353, slip op. at 3 (Fed. Cir. Feb. 21, 2017).?á Although earlier precedent, such as Blue Calypso, LLC v. Groupon, Inc., could… Continue Reading
We are pleased to welcome Board Members of the Texas Insurance Academy to the Haynes and Boone Dallas office. Please join our Texas Insurance Academy LinkedIn Group.
If 2016 is memorable as a year of immense political upheaval, 2017 may offer more of the same. ?áAlready, in the first months of 2017, significant domestic political events have transpired, with the promise of more to come.?á These are events of significant consequence to specific companies, discrete industries and America?ÇÖs global trading partners.?á Domestically, for example, we can anticipate changes in regulations governing private health insurance and uncertainty regarding bi- and multi-lateral trade agreements. ?áOverseas, continued anxiety exists in Europe over the ongoing Syrian refugee crisis and ?Ç£Brexit.?Ç¥ ?áFrance, Germany, the Netherlands and Italy will all hold general elections in 2017, with important implications for the Euro and the economic outlook for the EU and the global economy. There are ways to manage even the extreme financial risk created by the political turmoil of late.?áWell-established tools like lobbying, contractual risk transfer and insurance may to one degree or another… Continue Reading
Last December, we reported on the DOL?ÇÖs release of final regulations revising ERISA?ÇÖs claims procedures for disability benefits. A more in-depth review of the types of benefit plans affected by these final regulations is available on our companion blog, HB Health and Welfare.
Overview On December 19, 2016, the U.S. Department of Labor (DOL) issued final rules revising the claims procedures for ERISA plans that make disability determinations affecting plan benefits.?á The DOL noted that nearly two-thirds of all ERISA litigation involves claims under long-term disability plans, and the final rules are intended to improve the ?Ç£full and fair review?Ç¥ of disability claims under ERISA ?º 503 and ERISA Reg. ?º 2560.503-1 by expanding the procedural requirements.?á It?ÇÖs debatable whether the new procedures will actually cut down on the volume of future litigation once individuals have exhausted the appeals process, but the final rules should lead to a better administrative record for review during litigation. The final rules generally make the disability claims procedures more consistent with the procedures for group health plans as modified by the Affordable Care Act (ACA), although the unique timelines for disability procedures remain intact, there is no… Continue Reading
The U.S. Court of Appeals for the Ninth Circuit, sitting en banc, recently held that plaintiffs?ÇÖ breach of fiduciary duty claims were not barred by ERISA?ÇÖs six year limitations period, even when the retirement plan investments in question were selected by the plan?ÇÖs fiduciary more than six years prior to plaintiffs?ÇÖ suit. The Ninth Circuit applied the U.S. Supreme Court?ÇÖs recent decision in this case, which confirmed that fiduciaries have an ongoing fiduciary duty to monitor investments in retirement plans and to remove imprudent ones. (For additional information on the Supreme Court?ÇÖs decision, please see our prior post.) The Ninth Circuit distinguished between a fiduciary?ÇÖs duty to prudently select investment alternatives from the fiduciary?ÇÖs duty to prudently monitor them. Consequently, a fiduciary?ÇÖs ongoing duty to monitor plan investments could result in a series of breaches as an investment alternative is retained over time. The Ninth Circuit remanded the case back… Continue Reading
The IRS recently issued proposed regulations regarding the definition of ?Ç£dependent?Ç¥ under the Internal Revenue Code (?Ç£Code?Ç¥). The proposed regulations generally update existing regulations to conform to amendments previously made to Code Section 152 and other Code sections by the Working Families Tax Relief Act of 2004 (?Ç£WFTRA?Ç¥) and subsequent legislation. Under WFTRA, Code Section 152 was amended to provide that a federal income tax dependent is either a taxpayer?ÇÖs ?Ç£qualifying child?Ç¥ or ?Ç£qualifying relative.?Ç¥ These definitions are relevant for employers that sponsor (i) group health plans if such plans provide coverage for an employee?ÇÖs dependent who is not his or her spouse or child under age 27, but who is the employee?ÇÖs federal income tax dependent, and (ii) dependent care assistance programs which reimburse covered employees for qualifying dependent care expenses of qualifying children and certain other federal income tax dependents. The proposed regulations also provide new guidance with… Continue Reading
On January 18, 2017, the IRS published proposed amendments to regulations under Section 401(k) of the Internal Revenue Code, which would permit the use of forfeitures to fund safe harbor contributions, qualified non-elective contributions (?Ç£QNECs?Ç¥), and qualified matching contributions (?Ç£QMACs?Ç¥). Existing regulations provide that employer contributions may only qualify as safe harbor contributions, QNECs, or QMACs if they are non-forfeitable and not eligible for early distribution at the time they are contributed to the plan. The proposed regulations, which may be relied upon currently, would instead require that safe harbor contributions, QNECs, and QMACs be non-forfeitable and not eligible for early distribution at the time they are allocated to participants?ÇÖ accounts. View the proposed regulations.
Generally, a fixed-indemnity health plan pays benefits based on a time period, such as $100 per day, and not based on the amount of medical care expenses actually incurred. The IRS issued an Office of Chief Counsel Memorandum (the ?Ç£Memorandum?Ç¥) stating that benefit payments under an employer?ÇÖs fixed indemnity health plan are included in the employee?ÇÖs gross income and wages if the employer pays for the cost of the coverage or if the premiums are paid for on a pre-tax basis through a cafeteria plan. Such benefits are not included in gross income and wages if employees pay premiums on an after-tax basis. The advice in the Memorandum may not be used or cited as precedent but does provide insight regarding how the IRS would view a similar tax situation. View the Memorandum.
President Trump signed an executive order on January 20, 2017, generally directing the heads of government agencies to halt enforcement of Affordable Care Act (?Ç£ACA?Ç¥) provisions that cause financial or regulatory burdens on a host of entities, to the extent permitted by law. While this executive order did not specifically use the word ?Ç£employer?Ç¥ in the list of entities, the list can be construed to include employers providing health coverage to employees. The executive order itself does not relieve employers of any obligations to comply with the ACA, and this action should not occur until the various federal agencies issue guidance delaying or halting the enforcement of specific ACA provisions. The Departments of HHS, Labor, and the Treasury are unlikely to take any action until their new Secretaries are confirmed. In the meantime, employers should continue to comply with the ACA pending issuance of future guidance. View the executive order.