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U.S. Supreme Court Rules Lifetime Retiree Health Benefits Cannot be Inferred from CBA

In the case of CNH Industrial N.V. v. Reese, an employer and certain retirees disputed whether an expired collective bargaining agreement (“CBA”) covering union employees created a vested right to lifetime retiree health benefits. The retirees had successfully argued at the U.S. Court of Appeals for the Sixth Circuit that the duration of their retiree health benefits was ambiguous because the CBA was silent on that issue, which enabled the Sixth Circuit to consider other extrinsic evidence to support its finding that retiree health benefits were vested for life. The Supreme Court, however, disagreed, reasoning that (i) silence alone regarding the duration of retiree health benefits did not make the CBA ambiguous in that regard and (ii) ambiguity required the terms of the CBA to reasonably support an interpretation that retiree health benefits were intended to be vested for life before any extrinsic evidence could be applied. Consequently, the Supreme… Continue Reading

PTAB Goes Off-Roading With Commercial Success and Teaching Away Analysis

Recently, in Polaris Industries, Inc., v. Arctic Cat, Inc., No. 2016-1807, 2016-2280 (Fed. Cir. February 9, 2018), the Court of Appeals for the Federal Circuit (“CAFC”) overturned a Patent Trial and Appeal Board (“Board”) decision that all claims of a patent directed to a side-by-side all-terrain vehicle (ATV) were unpatentable as obvious in a first inter partes review (IPR), while affirming the Board’s decision that the claims of the same patent were not unpatentable in view of a different combination of references in a second IPR. Specifically, the CFAC found that the Board failed to conduct a proper teaching away analysis and failed to weigh Polaris’s argument of commercial success when determining certain claims were obvious. This appeal stems from two IPR petitions filed by Arctic Cat challenging the patentability of U.S. Patent No. 8,596,405 (“the ‘405 patent”) after Arctic Cat was sued by Polaris for infringing claims of that… Continue Reading

DOL Increases Civil Monetary Penalties for Certain Violations of ERISA

The DOL recently issued a final rule that adjusts for inflation the amounts of civil monetary penalties assessed or enforced in its regulations, including for certain violations of ERISA. The adjusted penalty amounts apply to violations occurring after November 2, 2015, and for which penalties are assessed after January 2, 2018. Below is a list of some of the penalties that were increased: The maximum penalty for failing to properly file a pension or welfare benefit plan’s annual Form 5500 increased from $2,097 per day to $2,140 per day The maximum penalty for failing to provide notices of blackout periods or notices of the right to divest employer securities increased from $133 per day to $136 per day (and each statutory recipient constitutes a separate violation) The maximum penalty for failing to provide employees with the required notices regarding coverage opportunities under the Children’s Health Insurance Program, or CHIP, increased… Continue Reading

Collateral Estoppel Springs From Final IPR Decisions and Applies to Proceedings Involving the Same Claims and Claims Not “Patentably Distinct”

Collateral Estoppel Springs From Final IPR Decisions and Applies to Proceedings Involving the Same Claims and Claims Not “Patentably Distinct”

In MaxLinear, Inc. v. CF CRESPE LLC., No. 2017-1039, 2018 U.S. App. LEXIS 1930 (Fed. Cir. Jan. 25, 2018), the Federal Circuit vacated and remanded the Patent Trial and Appeal Board’s (PTAB) final written decision in IPR2015-00592 (the ‘592 IPR).  The PTAB had found that all instituted claims were not shown to be unpatentable, but during the pendency of the appeal, the Federal Circuit affirmed a decision in another IPR finding the same patent’s independent claims unpatentable. The Federal Circuit then held that collateral estoppel applied and vacated the Board’s decision.  Because the PTAB focused solely on the now-invalid independent claims in its decision, the Court ordered the PTAB to consider on remand whether the dependent claims were “patentably distinct.” However, the Federal Circuit’s guidance on this point presents logical and procedural uncertainties for the PTAB, as it has been directed to consider prior art not of record in the… Continue Reading

Seventh Circuit Court of Appeals Holds that ERISA Does Not Pre-empt State Slayer Statutes

Anka Miscevic had a history of mental illness. While her husband Zelkjo was sleeping, she stabbed him in the chest and hit him over the head with a baseball bat, killing him. An Illinois state court found Anka not guilty by reason of insanity. The U.S. Court of Appeals for the Seventh Circuit, the first federal appellate court to address ERISA pre-emption of any state slayer statute, held that Illinois’s slayer statute was not pre-empted by ERISA. At the time of his death, Zeijko was a participant in a union pension fund. If a participant were married at the time of his or her death, the fund would pay a pre-retirement death benefit to the surviving spouse. If a participant were not married but had a minor child, the fund would pay a minor child benefit until the child turns 21. Both Anka and her minor child filed competing claims… Continue Reading

Deferred Effective Date of “Cadillac Tax” on High Cost Employer-Sponsored Health Coverage

In addition to maintaining the funding of the federal government through February 8, 2018, the recently enacted continuing resolution, H.R. 195, entitled the “Federal Register Printing Savings Act of 2017”, deferred by two additional years the date on which the excise tax on high cost employer-sponsored health coverage under the Affordable Care Act, the so-called “Cadillac Tax”, becomes effective. The effective date of the Cadillac Tax had previously been postponed until taxable years beginning after December 31, 2019 (see our prior blog post regarding that postponement). Under H.R. 195, the Cadillac Tax will now go into effect for taxable years beginning after December 31, 2021 (i.e., for calendar year health plans, January 1, 2022). View the text of H.R. 195.

February 2018
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