Author: Niki Jones

Avoiding Liability in AI Healthcare Decision-Making

Over a half dozen states have already enacted legislation regulating the use of artificial intelligence (AI) in healthcare decision-making. Now the New York State Legislature, too, is considering several bills limiting AI use in healthcare and insurance decision-making (A1456, S7896/A8556, A3991), though no governing regulations have been signed into law thus far.

For this reason, it is essential that physician groups and their attorneys keep a close eye on this developing legislation and relevant precedent. While there are no specific state-level regulations currently in place, physician groups and other healthcare providers face potential liability when AI is used in the decision-making and claims processes, specifically when the technology is found to conflict with existing policies and contracts.

Recent Litigation on AI-Enabled Healthcare Claims Processing

Three ongoing cases highlight the risks that healthcare providers and insurers face using AI models and algorithms for decision making.

• Kisting-Leung, et al. v. Cigna Corp., et al. (2023) – Three California plaintiffs filed a putative class action lawsuit against Cigna over claims they allege were denied due to use of the company’s PXDX algorithm. Without using any AI-specific statutes, the plaintiffs asserted that usage of the algorithm contradicted the company’s own terms requiring reviews by a medical director. While some of the plaintiffs’ initial claims have been dismissed, the case remains pending as the court considers breach of fiduciary duty in violation of 29 U.S.C. § 1132(a)(3) and alleged violations of California’s Unfair Competition Law (UCL).
• Estate of Lokken v. UnitedHealth Group, Inc., et al. (2023) – Similar to the Kisting-Leung case, the plaintiffs allege that UnitedHealth denied claims using their own AI model called nH Predict. The model purportedly told providers when post-acute care for Medicare Advantage patients should be cut off and provided generic recommendations that did not take a patient’s individual circumstances into account. This case has further mirrored Kisting-Leung in that some of the plaintiff’s claims have been dismissed because of protections for insurers under the Medicare Act. The issue of whether UnitedHealth violated their own policies by allowing an AI algorithm to make decisions that are required to be made by clinical staff or physicians will be considered under Minnesota state law.
• Barrows et al. v. Humana, Inc. (2023) – This case, filed in Kentucky federal court, also alleges wrongful denial of Medicare claims due to Humana’s use of the same nH Predict model at the center of the UnitedHealth case.

California and several other states have enacted laws regulating the use of AI in processing health care claims and coverage determinations since these cases were filed, with most including provisions requiring individual review of cases by qualified, human medical professionals. Nevertheless, the primary question posed by these lawsuits is not about whether AI should be used in determining health claims, but rather if the use of AI violates the company’s existing operational terms.

How Physician Groups and Insurers Can Avoid Liability

In New York, physician groups and insurance companies must consider liability if they choose to employ AI technology as a factor in their decision-making and claims processes. Public distrust of AI usage in highly sensitive matters like healthcare is a risk factor for litigation even when companies have taken steps to use the technology responsibly, transparently, and in concert with human decision makers.

In the absence of governing law, companies must first ensure that their policies and contracts allow for and regulate AI usage, so they are not subject to the same legal challenges being faced by Cigna, UnitedHealth and Humana. In the long term, New York’s position as a forerunner in AI regulation suggests that physician groups and other healthcare companies should prepare for stricter governance in the future. While 2025’s RAISE Act did not directly impact the healthcare sector, its passage established New York as a leader in AI regulation, and that leadership is likely to extend to the healthcare industry going forward.

Physician groups, insurance companies and other healthcare providers should secure legal counsel to answer questions about AI liability and review their current policies and procedures to shield themselves against potential litigation.

Bleakley Platt & Schmidt’s Health Care Litigation and Health Law practice groups are ready to guide you through this evolving set of challenges. Contact us today to schedule a consultation.

Bleakley Platt & Schmidt Partners Obtain Significant Ruling in Favor of the Town of Yorktown

On March 30, 2026, Bleakley Platt Partners Adam Rodriguez and David Chen obtained a significant ruling in favor of the Town of Yorktown when a federal judge dismissed a lawsuit against the town in a case concerning the planned construction of a recycling center.

U.S. District Judge Kenneth M. Karas dismissed a lawsuit brought by a private developer against the Town of Yorktown, ruling that the municipality acted within its legislative authority when it amended its zoning code to eliminate recycling transfer facilities as a permitted use.

In the lawsuit, the developer sought millions of dollars in monetary damages, alleging that the Town and several individual officials violated its constitutional rights by blocking its efforts to build a 40,000-square-foot recycling transfer station on Route 6.

“We were very confident that the court would dismiss this lawsuit,” said Town Attorney and Bleakley Platt Partner Adam Rodriguez. “The court recognized that the town’s actions reflected the legitimate exercise of forward-looking, constitutionally protected, home-rule authority.”

Read more about the case here: Court dismisses AAA Carting’s lawsuit against Yorktown – The Katonah-Lewisboro Times

New York Considers Ending Non-Competes for Most New York Employees

Pending legislation (S4641/A01361), which we believe has a good chance of being passed and signed into law by Governor Hochul, would ban non-compete agreements for employees who are not highly compensated or are health-related professionals compensated at any salary level.

The law would apply only to agreements entered into after the law goes into effect. This legislation would represent a fundamental change for New York employers—particularly for New York hospitals, physician groups and other health care provider entities.

What Employers and Employees will be Covered by the Law

Employers: The law applies not only to employees who reside in New York, but also to individuals who are employed in New York or who work remotely outside the state but report to a New York worksite, office, or a New York based supervisor. Accordingly, if enacted in its current form, the legislation likely will act as a catalyst for employers to restructure their business operations to minimize their New York state contacts and avoid the reach of the law when possible.

Employers may wish to move their offices from New York and change their internal management structures to have employees report to out of state supervisors.

Employees: S4641/A01361 applies to a “covered individual,” defined as any person other than a highly compensated individual who, whether or not employed under a contract of employment, performs or has performed work or services for another person on such terms and conditions that they are, in relation to that other person, in a position of economic dependence on, and under an obligation to perform duties for, that other person.

The law would exclude from the definition of a “covered individual” any person making an average of $500,000 or more per year. The law covers any “health related professional,” which includes physicians, registered nurses (RN), physician assistants (PA), and many other licensed specialists.

The Litigation Trap

Critically, the bill makes non-compete clauses unenforceable but also introduces a private right of action. This means an employee could potentially sue an employer for including or attempting to enforce prohibited language.

• The Cost of Non-Compliance: If an employer violates the law, New York courts may void the non-compete agreement and order all appropriate relief, including enjoining the conduct; ordering payment of liquidated damages (up to $10,000); and awarding lost compensation, compensatory damages, reasonable attorneys’ fees and costs to the employee.
• Litigation Liability: Once the legislation is enacted, employers should alter or eliminate any non-compete language in their employment contract templates before using them for new employees. Employers also should expect New York courts to be even more reluctant to enforce any non-compete provisions in their preexisting agreements.

Provisions that Companies May Include in Agreements

While employers may not be able to stop their current or former employees from working for competitors, they can—and should—protect their client or patient base by including other covenants, such as:

• Intellectual Property & Trade Secrets: Patient lists, proprietary billing methodologies, and internal protocols remain protectable assets. Ensure confidentiality agreements are updated and well drafted.
• The Sale-of-Business Exception: Non-competes may still be valid during the sale of an LLC or partnership interest (requiring at least a 15% ownership stake).
• Garden Leave: For those circumstances where the restricted individual is not a highly compensated individual or a health related professional and the covenant complies this applicable common law requirements, garden leave provisions—where an employee is paid to remain away from work during their notice period—can offer a strategic buffer without legally restricting future employment. The non-compete restriction cannot last for more than one year and the employer must continue paying the employee’s salary for the entire time the non-compete is being enforced.

A Proactive Compliance Action Plan

Bleakley Platt & Schmidt’s attorneys can guide you through compliance with a proactive action plan. We recommend that employers of individuals who are not highly compensated or are health related professionals take the following steps before S4641/A01361 becomes law:

1. Deconstruct Your Templates: Identify and remove non-compliant non-compete provisions that could trigger the $10,000 penalty under the new private right of action.
2. Redefine Reasonableness: Ensure that non-solicitation and confidentiality clauses are properly drafted and narrowly tailored as we believe that these provisions will become more important and face increased judicial scrutiny.
3. Restructure Incentives: Replace upfront, unprotected bonuses with retention incentives that reward loyalty and tenure rather than penalizing movement.
4. Improve Employment Environment: Redouble efforts to strengthen organizational culture to promote competitive benefits, positive working conditions, “whole person” employee experience, transparent communication, constructive feedback and recognition of positive contributions.

Contact us today to schedule a comprehensive agreement audit with attorneys from our Health Law, Health Care Litigation and Corporate Law practice groups.

New York Seeks to Expand Prohibition of the Corporate Practice of Medicine

New York is currently considering Senate Bill S8442, which would extend the state’s strict prohibition on the corporate practice of medicine (CPOM). The bill would bar non-physician-owned Management Services Organizations (MSOs) or private equity firms from holding majority voting shares or controlling the board of directors in professional medical corporations. 

The History of the Corporate Practice of Medicine 

The roots of New York’s prohibition on CPOM go back over a century. The doctrine is derived from New York’s Education Law (§ 6509-a), which states only licensed physicians can own and control medical practices. Cases like People v. Woodbury Dermatological Institute (1908) and Stern v. Flynn (1936) revealed early concerns about corporations influencing medical decisions and eroding the trust between physicians and patients.  

New York’s CPOM prohibition is among the strictest in the nation. Only licensed physicians or physician groups can own medical practices in the form of Professional Service Corporations (PCs), Professional Limited Liability Companies (PLLCs), or Registered Limited Liability Partnerships (RLLPs) in the state. 

How New York Might Further Prohibit the Corporate Practice of Medicine 

Senate Bill S8442 would close one of the primary loopholes that non-physician-owned businesses have utilized to exert control over medical practices. Currently, physician-owned and physician group-owned practices can employ Management Services Organizations to handle non-medical functions like billing, accounting, or human resources.  

MSOs can, in turn, control governance and clinical operations by securing a majority of voting shares or board seats. Non-physicians can occupy officer roles on those boards, leaving open the possibility that MSOs can shape board leadership for their own benefit. Senate Bill S8442 would prohibit this workaround and ensure that medical practices are fully owned by physicians or physician groups.  

While New York State’s Education Law (§ 6509-a) does explicitly define professional misconduct in relation to CPOM, there is currently no statutory protection for whistleblowers who report such violations or unethical practices. Senate Bill S8442 would prohibit retaliation against these medical professionals—even if their report violates a nondisclosure or non-disparagement agreement. 

Recommendations for Physician Groups That Work with MSOs 

New York’s history of strict prohibition of CPOM suggests that this bill is likely to pass. To prepare for this eventuality, physician groups that work with MSOs must: 

• Examine their administrative services agreements to ensure MSOs do not cross into “clinical or operational control,” as the new law voids contract provisions that interfere with a physician’s professional autonomy or clinical decision-making. 

• Revise their board by-laws and Articles of Incorporation to align with Senate Bill S8442’s provisions on board structure and membership as well as rules governing the ownership of shares. 

• Inform health care employees of protection against retaliation for whistleblowing also included in the bill. 

To stay compliant with the provisions of this bill and other New York health care laws and regulations, physician groups should contact Bleakley Platt & Schmidt’s extensively experienced health law attorneys today.  

New York Becomes 11th State to Ban Most Credit Checks by Employers during Hiring Process

In New York employment law news, Gov. Kathy Hochul signed Senate Bill S3072 into law on December 19, 2025, amending the New York State Fair Credit Reporting Act to prohibit employers from reviewing most candidates’ and employees’ credit history while making hiring or compensation decisions. Modeled on New York City’s “Stop Credit Discrimination in Employment” act, the law brings these noteworthy restrictions to employers in Westchester, Rockland, and the rest of the state.

How the Law Treats Credit Checks and Employment Practices

Under the new law, it is now considered an unlawful discriminatory practice for an employer to request or use consumer credit history when making employment decisions. “Consumer credit history” refers to consumer credit reports, credit scores, or information obtained directly from the individual regarding credit accounts, payment history, charged-off debts, items in collections, credit limits or bankruptcies, judgments, or liens. The law will go into effect on April 18, 2026, giving employers 120 days after its signing to review current hiring practices, retrain staff, and update HR manuals to account for the amendment.

New York employers who staff multi-state teams must maintain anti-discriminatory hiring practices in accordance with the definitions of each state or jurisdiction in which their employees work. New York is now the 11th state to ban consumer credit checks for employment decisions, joining California, Colorado, Hawaii, Illinois, Maryland, Oregon, Vermont, and Washington. Several major cities (including New York City, Philadelphia, Washington D.C., and Chicago) also maintain jurisdictional restrictions to the same end.

Nevertheless, the scope of this amendment is not limited to New York employers. Because the law amends the New York Fair Credit Reporting Act (as opposed to Human Rights Law), any employer who is hiring or employs a resident of New York State must comply.

Exemptions for Positions of Public Trust, Security, or Signatory Power

Limited exemptions exist under this law. Employers may only request or review credit history for positions that require high degrees of public trust (including law enforcement or government roles with state-required background checks); involve security clearance considerations, whether state, federal, or private (like those relating to digital security systems and infrastructure); or if the individual has signatory power over $10,000 or more in third-party or employer funds or assets.

If the employer is required to obtain or consider credit information under state or federal law, or by a self-regulatory organization as defined by the Securities Exchange Act of 1934, then they are also statutorily exempt.

Recommended Actions for Westchester Employers

To prepare for the upcoming April deadline, employers should consider the following actions to bring hiring and employment practices into compliance with the new statute:

• Revise Background Check Forms: Remove credit check authorizations from standard job application packages unless the role meets a specific statutory exception.
• Train HR Personnel: Ensure hiring managers understand that even “informal” credit inquiries during interviews are now prohibited.
• Audit Exempt Positions: Document why specific roles are still subject to credit checks to prepare for potential Department of Labor audits.

These are just a few recommended actions and do not represent the full scope of necessary adjustments. A legal expert is best positioned to advise on how to stay compliant with labor laws in all states. Contact Bleakley Platt & Schmidt’s Employment Discrimination Practice Group to review how this amendment impacts your firm’s hiring and employment practices. As always, the best defense against allegations of employment discrimination is to implement policies that prevent it from occurring.

The Risks of Simplicity: Understanding Transfer on Death Deeds in New York

For high-net-worth individuals and families in New York, the landscape of real estate succession has shifted over the past year. With the enactment of Real Property Law Section 424 the state introduced an instrument known as the transfer on death deed. This tool has been promoted as a modern, low-cost way to bypass the probate process, but it does not effectively replace a traditional estate plan.

What Is a Transfer on Death Deed?

While the concept appears straightforward, the legal reality is that a transfer on death deed is a specialized tool with narrow applications. For the sophisticated property owner, relying on this instrument without professional guidance can lead to significant financial exposure and unintended distribution consequences.

To understand the problems with transfer on death deeds, one must first understand their mechanics. This deed allows a property owner to name a beneficiary who will automatically inherit the real estate upon the owner’s passing. Unlike a traditional deed, it grants the beneficiary no legal interest while the owner is alive. The owner maintains the absolute right to sell, mortgage, or revoke the deed at any time.

However, the execution requirements are rigorous. The document must be signed by the transferor in the presence of two witnesses and acknowledged by a notary. Most importantly, it must be recorded in the county clerk’s office prior to the owner’s death. Failure to meet these “will-like” formalities renders the deed void, potentially forcing the property back into a lengthy probate proceeding that the owner sought to avoid.

Learn more about how transfer on death deeds work here.

The New York Estate Tax Cliff and Financial Risk

The primary concern regarding a transfer on death deed in New York involves taxation. In 2026, the New York State estate tax exemption will increase to $7,350,000. New York utilizes a “cliff” rule: if an estate exceeds this threshold by more than 5%, the entire exemption is lost. In such cases, the estate is taxed from the first dollar at rates as high as 16%.

Because property passing via this deed is still included in the taxable estate, it can easily push a family over this cliff. Unlike a Revocable Living Trust, which can be structured with credit-shelter provisions to shield assets from this tax trap, a simple deed offers no strategic flexibility. Individuals may find that the “simplicity” of a deed results in a six-figure tax bill that could have been avoided with a more comprehensive plan.

The Incapacity Gap and Asset Protection

Another significant issue is the “incapacity gap.” A transfer on death deed only functions at the moment of death. It provides no authority for a family member or fiduciary to manage, sell, or refinance the property if the owner becomes mentally or physically incapacitated. Without a trust or a robust power of attorney, families may be forced into an expensive and public Article 81 guardianship proceeding.

Furthermore, transfer on death deeds offer no protection against creditors or Medicaid estate recovery. Under New York law, property transferred this way can be “clawed back” for up to 18 months after death to satisfy the decedent’s debts. Because the property remains in the owner’s name during their lifetime, it is also considered a fully available resource for Medicaid eligibility, making transfer on death deeds ineffective for long-term care planning.

Unintended Disinheritance and Marketability Risks

Finally, the statute creates risks regarding the ultimate distribution of assets. If a named beneficiary predeceases the owner, New York’s default rule causes the gift to lapse. This means the property may pass to other surviving beneficiaries rather than to the children of the deceased beneficiary, potentially disinheriting grandchildren. Additionally, the law provides co-tenants with a 180-day right of first refusal, which can complicate or freeze a sale for six months after the owner’s death.

While the transfer on death deed has its place, it is not a substitute for a professionally drafted Will or Trust. To ensure your legacy is protected from tax traps and legal hurdles, it is essential to consult with an experienced estate planning attorney. Bleakley Platt & Schmidt’s Trusts & Estates Practice Group can help navigate potential pitfalls.

New York’s Challenge to NLRB: A Dual Regulatory Dilemma

Employers in New York State must pay close attention to the unfolding jurisdictional conflict between the state and the federal government over the government administration of labor relations law and employee rights to organize and engage in free speech. A recent legislative maneuver by New York, coupled with a swift response from the National Labor Relations Board (NLRB), has created an uncertain environment for businesses operating within the state. The central issue is the NLRA preemption doctrine, which grants the federal government exclusive authority over most private-sector labor matters for employers engaged in interstate commerce pursuant to NLRB jurisdictional standards.

New York’s Bid for State Jurisdiction

In September 2025, New York Governor Kathy Hochul signed S8034A, an amendment to Section 715 of the New York Labor Law. This “NLRB Trigger Bill” attempts to expand the scope of the New York State Labor Relations Act (NYLRA) to cover private-sector employers and employees who are normally subject to the exclusive jurisdiction of the federal National Labor Relations Act (NLRA). Ironically, NYS merged the State Labor Relations Board (SLRB) into the Public Employment Relations Board (PERB) in July 2010 raising the obvious issue of exactly how the State would be able to handle the additional federal case law with the already congested PERB’s case calendar for both improper practices and representation issues.

The state’s action was a direct response to the federal case backlog stemming from the NLRB’s lack of a three-member quorum since January 2025. While the NLRB’s regional offices continue their day-to-day functions, the lack of a quorum prevents the Board in Washington, D.C. from deciding appeals of both Regional and administrative law judges’ decisions.

The mechanism for this proposed concurrent jurisdictional assertion is highly ambiguous and contingent if not misguided: state intervention would only be triggered if the NLRB does not “successfully” assert jurisdiction, an assertion that the law curiously requires to be pursuant to an order from a federal district court. This requirement ignores the standard administrative processes of the NLRB, which under the NLRA rarely involve federal district court orders other than those for injunctive relief. Nor does it address exactly how PERB can expeditiously handle the proposed federal case backlog.

Review the amendment in its entirety here.

The Federal Counterpunch and Preemption Crisis

The federal government did not let this challenge to its authority stand. Just days after the bill’s signing, news spread that NLRB had filed a federal lawsuit against New York State, seeking a declaratory judgment and an injunction against the amendment. The federal agency asserted that the new State Labor Relations Act provision is fundamentally preempted by the NLRA as confirmed by the U.S. Supreme Court’s 1959 decision in San Diego Building Trades Council v. Garmon.

The core contention is that the NLRA grants the federal Board exclusive authority over most private-sector labor relations engaged in interstate commerce, an authority that remains intact even when the Board lacks a quorum to issue final decisions. Acting General Counsel William B. Cowen stated that the state law “unlawfully usurps” the NLRB’s jurisdiction and creates unwarranted confusion. This news highlights that NLRB’s suit aims to preserve a uniform national labor policy, which the Supreme Court’s Garmon decision has long held bars states from regulating conduct that is even arguably protected or prohibited by the NLRA.

Legal Implications for Employers

For employers engaged in interstate commerce, this inter-governmental conflict presents an immediate and significant escalation in legal complexity and procedural uncertainty.

• Dual Regulatory Threat: Businesses in New York, particularly those facing organizing drives or ULP charges, are now exposed to potential litigation on two fronts: defending the underlying labor charge and simultaneously litigating the federal preemption question over which agency—the NLRB or the state’s PERB—has ultimate authority. This risk of duplicative proceedings and potentially conflicting outcomes drives up legal costs and consumes executive attention. 

• Operational Uncertainty: The ambiguity in New York’s “trigger” language regarding when the state’s jurisdiction applies means corporate counsel must now navigate two distinct and potentially contradictory sets of labor relations procedural rules, hindering the ability to establish clear, stable policies. 

Until a federal court resolves the preemption challenge, employers must proceed with extreme caution. Businesses with significant operations in New York are encouraged to consult our Labor & Employment Law Practice Group to monitor this litigation closely and maintain strict compliance with established federal labor law, while also preparing for the contingency of state-level agency involvement. 

Three Key Changes to Breach Notification Law

The New York General Business Law § 899-aa, also known as, the New York Stop Hacks and Improve Data Security Act (“SHIELD Act”), was amended in three key aspects: (1) a new 30-day breach notification timeframe, (2) a new notice requirement for New York Department of Financial Services (“DFS”) regulated entities, and (3) an amended definition of “Private Information.”

The SHIELD Act requires persons and businesses that own or license data containing Private Information to notify affected New York residents, certain state regulators, and consumer reporting agencies following a security “breach” of that information. The recent amendment now sets forth an explicit 30-day notification timeline, instead of the previous requirement to notify “in the most expedient time possible and without unreasonable delay.” The recent amendment to the SHIELD Act also introduces a new requirement for DFS-regulated entities that experience a breach to notify DFS, the New York State attorney general, the New York Department of State and the state police. These requirements became effective as of December 21, 2024.

The definition of “Private Information” under the SHIELD Act was expanded to explicitly include medical and health insurance information. Under the SHIELD Act, notice of a breach of any Private Information is required to be provided to the affected resident. Under the amended statute, Private Information now includes personal information consisting of “…(v) medical information regarding an individual’s medical history, mental or physical condition or medical treatment or diagnosis by a health care professional; or (vi) health insurance information including an individual’s health insurance policy number or subscriber identification number, any unique identifier used by a health insurer to identify an individual or any information in an individual’s application and claims history, including but not limited to, appeals history….”

Previously, the statute did not specifically require notifications for breaches that impacted medical or health insurance information. While HIPAA-covered entities are deemed compliant, and therefore exempt from the SHIELD Act’s security requirements with respect to electronic Protected Health Information (“ePHI”), healthcare providers and other organizations that process any New York resident’s Private Information must still comply with respect to non-ePHI, including the thirty (30) day notification requirement for any breach of Private Information.

For more information and regulatory guidance, please contact Robert Braumuller or Zaina S. Khoury at RBraumuller@bpslaw.com or ZKhoury@bpslaw.com.

New York State Laws Impose New Requirements for Patient Consent and Use of Credit Cards for Medical Services.

Enacted as part of New York State’s health and mental hygiene budget legislation for fiscal year 2024 through 2025, New York Public Health Law Section 18-c will become effective on October 20, 2024 to require healthcare providers to issue separate patient consent forms for treatment and for payment for services. The law also provides that “Consent to pay for any health care services by a patient shall not be given prior to the patient receiving such services and discussing treatment costs.”

The New York Department of Health has not yet issued its expected guidance on how health care providers should implement these new requirements. For example, how may health care providers collect payment if they furnish treatment before the patient agrees to pay and the patient refuses to pay any amount for the service?

The legislation also amends the NY General Business Law (“GBL”) by adding two new sections 349–g and 519–a. These provisions prohibit hospitals and health care providers from:

• Completing any portion of an application for medical financial products for the patient or otherwise arranging for or establishing an application that is not completely filled out by the patient.
• Requiring credit card pre-authorization or requiring the patient have a credit card on file prior to providing emergency or medically necessary medical services to such patient.

NY GBL § 519–a requires hospitals and health care providers to “notify all patients about the risks of paying for medical services with a credit card. Such notification shall highlight the fact that by using a credit card to pay for medical services, the patient is forgoing state and federal protections that regard medical debt. The commissioner of health shall have the authority and sole discretion to set requirements for the contents of such notices.” To comply with this requirement, healthcare providers should update their financial responsibility consent forms to state the following: “The patient understands that the use of a credit card on file and/or credit card preauthorization is a convenience that the patient is electing to utilize, is not a condition to treatment, and that by using a credit card, the patient is foregoing state and federal protections regarding medical debt.”

We will continue to monitor all legislative developments. If you have questions regarding these new requirements, please contact BPS’s Health Law attorneys, Robert Braumuller (914-287-6185 or rbraumuller@bpslaw.com) and Zaina Khoury (914-287-6187 or zkhoury@bpslaw.com)

NYSDOH Proposed Regulations on In-Person Medical Evaluation Requirements and Exceptions for Controlled Substance Prescribing

In response to the COVID-19 public health emergency (PHE), the U.S. Department of Health and Human Services (DOH) waived the Ryan Haight Act’s requirement that at least one in-person medical evaluation take place prior to issuance of a prescription for controlled substances via telehealth. The flexibility granted by DOH allowed telemedicine to be used in place of the in-person evaluation for the prescription of schedule II-V controlled substances. Since the conclusion of the federally declared PHE, the Drug Enforcement Administration (DEA) issued two temporary rules, the last of which extended the rules through December 31, 2024 to permit the prescription of controlled medications through telemedicine.

In light of this impending expiration, on May 15, 2024, the New York State Department of Health (NYSDOH) proposed amendments to Sections 80.62, 80.63, and 80.84 of Title 10 of the Official Compilation of Codes, Rules, and Regulations to align with the DEA’s policy permitting the prescription of controlled substance medications via telemedicine. For example, the proposed regulations adopt the federal regulatory term “in-person medical evaluation” in lieu of the current NY regulatory phrase “physical examination”.

If adopted, these proposed regulations will limit the circumstances in which a controlled substance can be prescribed in the absence of an in-person medical evaluation of the patient by the prescribing practitioner. If the regulations go into effect as proposed, a controlled substance may be prescribed without an in-person medical evaluation, only under the following circumstances:

1. When utilizing a consulting and referring practitioner for their patient if the patient’s medical record includes an in-person medical evaluation for the specific medical condition within 12 months performed by the practitioner who referred the patient.
2. For a covering practitioner in the temporary absence of the initial prescriber as part of continuing therapy for the patient if the covering practitioner is a part of the same practice or has direct consultation with the initial prescriber confirming the necessity of the prescription.
3. For a new condition in an emergency, provided that there is a pre-existing practitioner-patient relationship, the immediate administration of the drug is necessary, no alternative treatment is possible, and the prescription does not exceed a five-day supply.
4. Through telemedicine – as such term is defined by article 29-G of the Public Health Law.

The new NYSDOH regulations align with the DEA requirement that prescribers of controlled substances using telehealth must use audio-visual, real-time two-way interaction and write the prescriptions only for legitimate medical purposes. The proposed regulations also seek to align with federal law by removing outdated references to a DEA requirement for prescribing buprenorphine and a patient number limitation which are no longer in effect. Further, the outdated phrase “narcotic addiction” is now replaced with the term “opioid use disorder”.

As the DEA considers permanent changes to federal rules governing the prescription of controlled substances, given NYDOH’s additional intent to align NYS regulations with the federal rules, it is likely that NYDOH will propose revisions to its proposed regulations.

We will continue to monitor all developments. Contact Robert Braumuller at (914) 287- 6185 or rbraumuller@bpslaw.com for additional information.

Prenatal Leave in NYS According to Labor and Employment Law Attorneys

New York employers, take note. A significant change is coming in 2025 regarding employee leave. New York is the first state in the nation to require employers to provide paid prenatal leave for pregnant workers. While the major points of this legislation are straightforward, the State’s lack of guidance on finer points, like recordkeeping, has the potential to create pitfalls for employers. Because the law becomes affective January 1, 2025, managers should consult a labor and employment law attorney for compliance strategies in the absence of such guidance.

Background: NYS Paid Prenatal Leave

Governor Kathy Hochul signed legislation in April 2024 expanding the New York Paid Family Leave Law (NY PFL) to include 20 hours of paid leave for prenatal doctor appointments within a 52-week calendar period.

The new law is separate from existing sick leave and safe leave provisions. Employees can use this new benefit for a variety of pregnancy-related healthcare services, including:

• Physical examinations
• Medical procedures
• Monitoring and testing
• Discussions with healthcare providers

Key Considerations for Employers

• Eligibility: All pregnant employees, regardless of length of service, are entitled to NYS’ paid prenatal leave benefit.
• Leave Usage: The 20 hours can be used in hourly increments and is paid out in the same manner.
• Employee Rights: Employers cannot retaliate against employees for using prenatal leave. Upon return, they must be restored to their previous position with the same terms and conditions of employment. Unused leave does not need to be paid out at the end of employment.

Current Unknowns and Recommendations

NYS’ paid prenatal law remains silent on some crucial details for employers. Proactive managers will do well to consult with legal counsel and strategize on compliance in the absence of clarification regarding:

• Recordkeeping Requirements: There are currently no regulations on how employers must track this leave.
• Notice Requirements: It’s unclear if employers need to provide specific notification regarding this benefit.
• Poster Requirements: As of this time, no official posters have mandated.
• Timing of Guidance: Although the State has promised to provide guidance on the above points prior to the law’s affective date, no specifics have been given as to when this additional detail can be expected.

Staying Compliant: Consult a Labor and Employment Law Attorney

While the new law offers significant benefits for pregnant employees, employers must adequately prepare for its implementation. Bleakley Platt & Schmidt’s Labor & Employment Law Practice Group can assist you in revising your paid leave policies, ensuring compliance with the upcoming changes and addressing any specific concerns you may have. We anticipate eventual guidance from the State regarding recordkeeping, notice, and potential carryover provisions before the law takes effect.

How Litigation Lawyers Protect Your Organization

In the dynamic and competitive business landscape, disputes are an unfortunate reality. Whether it’s a contract breach, a shareholder disagreement, or an environmental concern, litigation can disrupt operations, damage your reputation, and erode your bottom line. At Bleakley Platt & Schmidt, LLP, our experienced litigation lawyers understand the unique challenges faced by corporations and are dedicated to providing comprehensive solutions. 

What is Litigation?

Litigation is the legal process of resolving disputes through the court system. It involves various stages, including filing lawsuits, a discovery phase for exchanging information, presentation of arguments, trial, and appeal. While most cases ultimately settle through alternative means like negotiation, mediation, or arbitration, understanding the litigation process is crucial for effective dispute resolution.
Dive deeper into the field of litigation here. 

Bleakley By Your Side 

BPS’s business litigation attorneys have a proven track record of success in complex matters. Our team represents businesses of all sizes, from Fortune 500 companies to local startups. We offer a comprehensive approach, including: 

• Litigation Avoidance: We believe the best defense is a good offense. Our attorneys advise on contract formation, risk management, and negotiation strategies to minimize the chance of litigation. 

• Pre-Litigation Strategy: When a dispute arises, our litigation lawyers can assess the situation, develop a winning strategy, and guide you through every step of the process. 

• Cost-Effective Solutions: We understand litigation can be expensive, and work to achieve your goals while keeping costs in check. 

• Extensive Experience: Our attorneys have deep expertise in various areas of business law, including contract disputes, shareholder and partnership disputes, mergers & acquisitions, intellectual property, and class actions. 

Our litigation services, span more than a dozen practice areas. Here is a look at how BPS litigators apply their expertise to some of our largest practices: 

Health Care Litigation: Navigating Complex Regulatory Waters

The healthcare industry is subject to a complex and ever-changing regulatory environment. Disputes involving hospitals, nursing homes, healthcare providers, and other healthcare entities require specialized knowledge and experience. BPS’s Health Care Litigation Practice Group provides comprehensive legal counsel to protect your interests. 

Our attorneys represent clients in a wide range of matters, including: 

• Compliance and Regulatory Investigations: We help healthcare providers navigate complex regulatory compliance issues and conduct internal investigations related to Medicare, Medicaid, fraud/abuse allegations, and false claims. 

• False Claims Act: We have a strong track record of defending healthcare providers against allegations of fraud and abuse. 

• Medicare and Medicaid Reimbursement: We assist clients in maximizing reimbursement and resolving disputes with government payers. 

• Licensing and Certification Issues: We help healthcare providers obtain and maintain necessary licenses and certifications. 

Corporate Litigation: Protecting Your Business Interests

Corporate litigation encompasses a broad range of disputes involving companies, shareholders, directors, and officers. Our Corporate Law Practice Group has extensive experience handling complex business disputes, including: 

• Merger and Acquisition Litigation: We assist clients in resolving disputes related to mergers, acquisitions, and corporate control. 

• Contract Disputes: We help businesses enforce their rights and protect their interests in contract disputes. 

• Complex Commercial Litigation: We handle complex litigation matters involving multiple parties and high stakes. 

Environmental Litigation: Mitigating Risks

Environmental compliance and litigation are critical concerns for businesses operating in today’s regulatory landscape. BPS’s Environmental Law Practice Group provides comprehensive legal counsel to help you manage environmental risks and protect your company’s reputation. 

Our attorneys have extensive experience in: 

• Superfund Litigation: We represent clients in complex Superfund matters, including site assessments, remediation, and cost recovery. 

• Environmental Compliance: We assist clients in developing and implementing compliance programs to avoid costly litigation. 

• Permitting and Regulatory Compliance: We help clients obtain necessary permits and comply with environmental regulations. 

• Environmental Cleanup and Remediation: We provide strategic guidance on environmental cleanup and remediation projects. 

• Natural Resource Damages: We defend clients against claims for natural resource damages. 

Bleakley Platt & Schmidt: Your Trusted Litigators

At BPS, we are committed to providing exceptional legal representation and strategic guidance to our clients. Our litigation lawyers have the knowledge, experience, and resources to help you navigate complex legal challenges and achieve your business objectives. Contact our Litigation Practice Group today. 

F Reorganizations Can Benefit Buyers and Sellers in Business Acquisitions

Certain corporate characteristics of a target company may be undesirable to potential buyers preventing them from acquiring the company. For example, the target company may be an S corporation, and the potential buyer would not qualify to be a shareholder of an S corporation under Internal Revenue Service (IRS) rules. Alternatively, the buyer may want the target company to be incorporated in a different state, such as Delaware, due to that state’s well-developed corporate law and chancery court system. In such situations and others, the seller can remove these obstacles prior to a sale by performing an “F reorganization,” a tax-free corporate reorganization under Internal Revenue Code (IRC) § 368(a)(1)(F). The IRC defines an F reorganization as a mere change of identity, form or place of organization of a corporation.1  

After undergoing an F reorganization, the target company may become a different type of entity, such as a limited liability company, and may be incorporated in another state. It will become a wholly owned subsidiary of a newly formed corporation (“Newco”). The steps to reach this result are as follows. First, the seller forms Newco as an S corporation. Second, the shareholders of the target company contribute all their shares to Newco in exchange for the stock of Newco. Newco elects to treat the target company, the shares of which it now owns, as a qualified subchapter S subsidiary (“Qsub”) so that it becomes a disregarded entity for federal income tax purposes. Third, the target company converts into a limited liability company under state law or merges into another subsidiary LLC formed in Delaware and remains a disregarded entity for federal income tax purposes.  

The following diagrams illustrate steps 2 and 3: 

Step Two 

Step Three

As a result of the reorganization, the individual shareholders own all the equity of Newco in the same proportions that they owned the target company. Newco is the single member of the target company and now is the seller in the proposed business sale transaction. After the reorganization, the target company is now an LLC and becomes attractive to a wider array of buyers because the restrictions under Subchapter S of the IRC2 on who may own shares of the company no longer apply. Additionally, the target company is now a Delaware company.  

Sometimes, the parties may want their transaction to include only some of the selling company’s assets. An F reorganization permits them to structure the transaction to sell less than all assets of the target business. To accomplish this, after the F reorganization is completed, the seller causes the target company to distribute up to Newco the assets that it wishes to retain. Then, only the assets that the buyer wishes to acquire will remain in the target company before the buyer purchases it. The F reorganization benefits both parties in this situation by enabling them to accommodate their business goals of transferring only some of the target company’s assets.  

An F reorganization offers other benefits as well. After an F reorganization, the seller can treat the business transaction as a sale of equity interests, while the Buyer can treat it for tax purposes as an asset purchase transaction. For the seller, at least part of the sale proceeds may be subject to long term capital gains rates, which are lower than ordinary income tax rates. The buyer benefits from a step-up in the basis of the target’s assets equal to the purchase price. In addition, the buyer does not need to obtain third party consents associated with transferring assets (rather than equity interests). This can be valuable to the buyer of a health care provider, such as a clinical laboratory, by enabling the target company being acquired to retain any valuable health insurance and other third party payor contracts that it has in place.  

A well-conceived F reorganization can offer buyers and sellers a valuable means to restructure target companies or buyer entities prior to business acquisitions to achieve various corporate and tax goals. The terms of such a restructuring can be specified in the parties’ purchase agreement and their implementation can be stated as a closing condition. Members of our firm’s corporate practice can help buyers or sellers of businesses use this corporate restructuring technique to reach agreement, maximize tax efficiencies and achieve other corporate goals in contemplated business acquisitions.  

New York Breastfeeding Law: Paid Lactation Breaks Explained for Employers

New York State has amended its labor law to accommodate breastfeeding mothers in the workplace. As of last month, employers are required to provide paid breastfeeding breaks. This update to Section 206-c of the New York Labor Law creates significant changes to workplace breastfeeding policies and numerous considerations for compliance. 

Changes to New York Breastfeeding Law for the Workplace
Previously, New York mandated that employers provide one unpaid break every three hours for nursing mothers to express breast milk. However, the recent amendment changes the equation: 

• Paid Breaks: Employers must now provide up to 30 minutes of paid breastfeeding break time each time an employee needs to express breast milk. This applies for up to three years following childbirth. 

• Flexibility: Employees can combine existing paid breaks or mealtimes with the allotted 30 minutes if their pumping needs exceed that timeframe. 

• Discrimination Protection: The law explicitly prohibits employers from discriminating against employees for expressing breast milk in the workplace. 

Resources and Compliance
The New York State Department of Labor (NYSDOL) has taken steps to ensure employers are aware of these changes: 

• Updated FAQs: The NYSDOL FAQs address paid lactation breaks and clarify employers’ obligations. 

• Revised Policy: The NYSDOL Policy on the Rights of Employees to Express Breast Milk in the Workplace has been updated and needs to be distributed to employees upon hire, annually, and upon returning from childbirth leave. 

• Fact Sheets: Separate fact sheets on the amendment, one for employers and another for employees, are available on the NYSDOL website. 

The NYSDOL emphasizes that employers must accommodate employees’ reasonable requests for breaks and acknowledges that the number of breaks needed can vary depending on the individual. 

What New York Employers Should Do Now
Because of these changes, New York employers should consider the following: 

• Review and Update Policies: Work with legal counsel to review and update existing lactation accommodation and leave policies to reflect the new paid breastfeeding break requirement. 

• Employee Communication: Disseminate clear and accurate information to employees regarding the amended law. Consider providing training for managers and supervisors on handling employee requests for lactation breaks. 

• Accommodation Strategies: Develop a plan for providing a clean and private space for expressing breast milk in the workplace. This could be a dedicated lactation room or a designated, private area. 

Staying Compliant
By understanding these changes and taking proactive steps, New York employers can ensure compliance with the new breastfeeding amendment to the Labor Law. Bleakley Platt & Schmidt, LLP’s Labor & Employment Practice Group is experienced in navigating workplace regulations and can assist your company in developing compliant lactation break policies and practices. 

Implications of DOJ’s Whistleblower Pilot Program

The Department of Justice’s (DOJ) Criminal Division recently launched a Pilot Program on Voluntary Self-Disclosures for Individuals (the “DOJ Whistleblower Pilot Program“). This program encourages individuals with knowledge of federal corporate or financial misconduct to assist federal agencies without fear of prosecution. For U.S. financial institutions, navigating this new program and its implications requires careful consideration. According to the DOJ, the pilot program aims to fill in the “patchwork quilt” of existing whistleblower programs currently in place at other federal agencies, including the Securities and Exchange Commission (SEC), to ensure that all areas of criminal wrongdoing prosecuted by the DOJ are covered. 

Program Summary
This federal whistleblower protection offers Non-Prosecution Agreements (NPAs) to individuals who meet specific criteria. DOJ may forgo criminal prosecution exchange for: 

• Voluntarily disclosing original information about previously unknown corporate criminal conduct in violation of applicable U.S. law 
• Cooperating with investigations 
• Remedying any wrongdoing (i.e. returning profits from illicit activity and paying damages to victims) 

Read a full synopsis of the program here. 

Covered Criminal Conduct and Eligibility
The program focuses on specific areas of enforcement, including fraud, Foreign Corrupt Practices Act (FCPA) violations, and money laundering. Individuals who participated in the misconduct but can provide substantial assistance against higher-level culprits are eligible. The organizers of such illicit activities, however, are ineligible, as are CEOs and CFOs. 

Background and Rationale
The DOJ recognizes the challenges of uncovering complex corporate crimes in violation of U.S. law. By offering new federal whistleblower protections, the program aims to: 

• Increase Detection: Individuals with firsthand knowledge can provide crucial details that might otherwise go undetected. 
• Enhance Investigations: Whistleblower cooperation strengthens cases against more culpable individuals. 
• Promote Accountability: The program incentivizes companies to implement strong compliance programs that prevent and address misconduct. 

Implications for Financial Institutions
Financial institutions subject to U.S. law face heightened scrutiny due to susceptibility to white-collar crimes. The DOJ Whistleblower Pilot Program presents both challenges and opportunities: 

• Increased Risk of Disclosure: The program may embolden whistleblowers to come forward, potentially leading to more internal investigations. 
• Importance of Compliance Programs: Robust compliance programs deter misconduct in the first place. 
• Cooperation as a Defense Strategy: If an investigation arises, cooperating with the DOJ and demonstrating a commitment to compliance can be advantageous. 

Considerations for Staying Compliant
Financial institutions subject to U.S. law should take proactive steps to address the DOJ Whistleblower Pilot Program: 

• Review and Update Compliance Programs: Ensure programs effectively address the covered criminal conduct outlined in the program. 
• Reinforce Internal Reporting Mechanisms: Provide clear and accessible channels for employees to report suspected wrongdoing internally. 

• Anti-Retaliation Policies: Uphold strong anti-retaliation policies to protect employees who report misconduct in good faith. 

This latest federal whistleblower protection signifies a shift in the government’s approach to investigating and prosecuting corporate crime. Financial institutions can reduce risk by understanding the program’s impact and promoting a culture of compliance. For more information, contact Jennifer A. Lofaro of our Commercial Finance Practice Group at (914) 287-6136 or jlofaro@bpslaw.com. 

NY Employment Law Trends: Nonresident Discrimination

The New York Court of Appeals recently broadened the scope of state anti-discrimination laws. The March 2024 decision in Nafeesa Syeed v. Bloomberg L.P. determined that non-resident job applicants can now pursue claims under the New York State Human Rights Law (NYSHRL) and the New York City Human Rights Law (NYCHRL) if they allege discrimination during the hiring process.

Background: The “Impact Test” and New York Anti-Discrimination Laws
Previously, New York courts applied an “impact test” to determine whether non-resident job applicants could sue under the NYSHRL and NYCHRL. Applicants needed to show how discrimination had a significant impact on their lives in New York.

The NYS Court of Appeals’ Syeed decision revisits this standard. Here, the Court determined that being denied a job opportunity in New York – even for an applicant who doesn’t currently live in the state – constitutes a sufficient impact to bring a claim. The Court reasoned that such discrimination deprives applicants of the “chance to work, and perhaps live, within those geographic areas.”

Review a summary of Syeed v. Bloomberg here.

Implications for NYS employers, especially those not subject to federal anti-discrimination laws
This decision presents new considerations for New York employers, particularly those with robust hiring practices that attract candidates from across the country. Here’s what you need to be aware of:

• Expanded Pool of Potential Claims: The Syeed decision widens the pool of potential claimants who now may be able to allege discrimination claims against potential employers. Hiring managers must have a valid, non-discriminatory reason for selecting or not selecting applicants for a particular position.
• Importance of Applicant Hiring and Interview Training: Regularly reinforcing anti-discrimination training for all personnel involved in hiring is crucial. This training should address appropriate job application and interview questions for applicants to ensure everyone involved understands how even simple questioning concerning an applicant’s family status, graduation dates, or time gaps in their resume may give rise to an inference of unlawful discrimination.
• Considerations for Remote Work: The Court currently limits its decision to positions that require physical presence in New York. However, employers with remote work opportunities should consult with employment law attorneys to stay updated on any further developments.

Staying Compliant with Employment Law Trends
The Syeed decision highlights the importance of staying informed about evolving employment law trends. At Bleakley Platt & Schmidt, LLP, our experienced employment discrimination attorneys can help your business with these complexities. We offer comprehensive guidance on hiring practices, compliance training, and legal representation against discrimination claims.

For further guidance or to discuss your specific situation, contact our employment law team today.

Material Health Care Transactions in New York Subject to DOH Disclosure and Public Comment

A new Article 45-A, titled “Disclosure of Material Transactions,” was added to the New York Public Health Law as part of the 2024 New York State Executive Budget law that Governor Kathy Hochul signed on May 3, 2023. This new legislation will substantially increase regulatory oversight by the New York State Department of Health (“DOH”) over large health care transactions. 

It applies to “health care entities,” which are broadly defined to include physician groups, management services organizations (“MSOs”), health insurance plans, and any other health care facility, organization or plan providing health care services in the state, subject to specified exclusions.  Starting August 1, 2023, health care entities must provide written notice to DOH of “material transactions” at least thirty (30) days prior to the closing of the proposed transaction. The final legislation does not include a provision in earlier versions of the legislation that would have required health care entities to receive DOH approval prior to closing such transactions.

A “material transaction” includes a single transaction or series of related transactions within a rolling twelve-month period, involving: health care entity mergers, acquisitions, affiliations, the formation of partnerships, joint ventures, accountable care organizations, parent organizations or management services organizations “for the purpose of administering contracts with health plans, third party administrators, pharmacy benefit managers, or health care providers.” Article 45-A specifically excludes from state oversight under the new law a “de minimis transaction,” which would result in a health care entity increasing its total gross in-state revenue by less than $25 million.

Written notice of such transactions shall include:

• the names of  the parties to the material transaction and their current addresses;
• copies of any definitive agreements governing the  terms  of  the material transaction, including pre- and post-closing conditions;
• identification of all  locations where health care services are currently provided by each party and the revenue generated in the  state from such locations;
• any plans to reduce or eliminate services and/or participation in specific plan networks;
• the closing date of the proposed material transaction;
• a brief description of the nature  and  purpose  of  the  proposed material transaction including: (i) the anticipated impact of the material transaction on cost, quality,  access,  health  equity,  and  competition in the impacted markets, which may be supported by data and a formal market impact analysis; and (ii) any commitments by the health care entity to address  anticipated impacts.

After written notice is provided, DOH will post a summary of the proposed transaction and other information provided on its website to permit the public to comment on the proposed transaction prior to closing. Health care entities that fail to comply with the new law are subject to civil penalties for each day in which the violation persists.

The new legislation takes effect on or about August 1, 2023, and grants DOH the authority to implement regulations regarding the disclosure process. Healthcare entities subject to the new law should evaluate planned transactions and keep apprised of subsequent DOH guidance to ensure compliance and avoid penalties.

For more information on navigating these new requirements and other regulatory guidance, please contact Robert Braumuller or Zaina S. Khoury, at RBraumuller@bpslaw.com or ZKhoury@bpslaw.com.

OMIG’s Proposed Regulations Could Require Substantial Changes to Medicaid Providers’ Compliance Programs

Medicaid enrolled health care providers in New York should be aware that on July 13, 2022, the New York Office of Medicaid Inspector General (“OMIG”) published proposed regulations that would substantially alter the compliance program requirements for all Medicaid enrolled health care providers and Medicaid managed care organizations (“MMCO”) and codify OMIG’s self-disclosure program. The public comment period for the proposed regulations summarized below will end on Sunday, September 11, 2022.

The proposed regulations would require Medicaid providers to include a provision in their contracts to oblige vendors to comply with the compliance program and permit the provider to terminate the contract for failure to do so. The proposed Subpart 521-1 provides for the provision of additional requirements for an effective compliance program and amends the definition of a “Required Provider” obligated to adopt and implement effective compliance programs to now include Medicaid managed care organizations (“MMCO”) or Long-Term Care Providers (“MLTC”), in addition to any entity subject to Article 28 or 36 of the Public Health Law or Article 16 or 31 of the Mental Hygiene Law.

MMCO’s with 10,000 or more enrollees are currently required to incorporate a fraud, waste, and abuse prevention program into their compliance programs, but Subpart 521-2 would expand applicability to MMCO’s of all sizes, regardless of enrollment. The proposal also would require MMCO’s with 1,000 or more enrollees to establish a full-time Special Investigation Unit (“SIU”) comprised of one full-time investigator and one director. An additional investigator must be employed for each 60,000 enrollees for most MMCOs or for each 6,000 enrollees for MLTCs, unless OMIG gives prior approval for alternative staffing levels. The proposed regulations impose on MMCOs the obligation to audit, investigate, and report cases of fraud, waste, or abuse to OMIG, and further mandate the scope of such audits to encompass clinical and billing records to ensure services were provided and billed appropriately. The proposed regulations also provide OMIG the ability to conduct an independent review of provider/MMCO compliance programs and impose monetary penalties or terminate provider participation in the Medicaid program based on the results of such review. Medicaid enrolled providers should expect enhanced scrutiny of claims as a result of this requirement.

The proposed Subpart 521-3 would codify subsection 7 of Section 363-d of New York’s Social Services Law, which became effective on April 1, 2020. The proposed regulations governing Medicaid program overpayments would mandate that all identified overpayments must be returned exclusively through the self-disclosure process.

If the proposed regulations are adopted, the rules will require providers and plans to review and update their compliance program documents as well as their service agreements to ensure these new requirements are addressed.  For further information, contact Robert Braumuller at RBraumuller@bpslaw.com (914) 287-6185 or Zaina S. Khoury at ZKhoury@bpslaw.com (914) 287-6187.

Employers Should Evaluate Self-Insured Health Plans for Employees in States Banning Abortions After Supreme Court’s Decision in Dobbs v. Jackson Women’s Health Organization

Background

On June 24, 2022, Dobbs v. Jackson Women’s Health Organization, No. 19-1392, 597 U.S. ___ (2022) was decided by the United States Supreme Court upholding the Mississippi law banning abortions after 15 weeks of gestation. The decision was sweeping, overturning Planned Parenthood of Southeastern Pa. v. Casey, 505 U.S. 833 and Roe v. Wade, 410 U.S. 113, to hold that the United States Constitution does not prohibit State legislatures from banning or limiting abortion services.

Self-Insured (ERISA) Health Plans Versus Fully Insured Health Plans

Large employers that offer self-funded health plans are largely unaffected by the Dobbs decision. State law cannot impact these plans because they are governed by Employee Retirement Income Security Act of 1974 (ERISA), which pre-empts states from adopting requirements that “relate to” employer-sponsored health plans. Courts have for decades interpreted that language to bar state laws that dictate what health plans can and cannot cover.

If, however, your health plan is a fully or partially insured group health plan (“Non-ERISA plan”), it is governed by state insurance regulation. Non-ERISA plans offered in pro-life states may soon be prohibited from covering some abortion services as their states pass legislation, or their previously passed “trigger laws” go into effect, to restrict or prohibit abortion after the Dobbs Decision.

Any Medicaid or even marketplace products with federal funding already ban abortion services under the Hyde Amendment unless they are in certain pro-choice states that have decided to use state funds to cover the services. The New York State Medicaid program, for instance, covers abortion services. It lists on its website entities that assist women in other states banning abortion with travel, housing, and other costs.

Healthcare providers in states like New York may be reimbursed by the ERISA plan or potentially by the state Medicaid program if eligible patients are enrolled upon entry into the state. Patients who are not eligible and have non-ERISA health benefits, may need to self-fund the medical services, or look for other resources, including their employers to cover abortion services.

Employers in states that have banned abortion and offer non-ERISA plans may be motivated by their leadership, their Boards, and their employees to assist employees with abortion services. They may begin by considering if they want to adopt a self-funded ERISA Plan so that they have control over the benefits protected from restrictive state laws.

Travel Reimbursement

ERISA Plans often already fund medical travel for various services and typically encourage travel to facilities designated as “centers of excellence”. Consequently, expanding covered travel to include travel expenses for medical services related to abortion services should be protected by ERISA from any state law restrictions. If a state sued an employer that sponsored a health plan offering coverage for abortion services out of state on the basis of the state’s restrictions on abortion services, the employer could rely on ERISA’s pre-emption terms as a defense to the law suit. If travel expenses are not part of the employer’s ERISA group health plan, it may offer other types of reimbursement plans like flexible spending accounts (FSAs) that may be used, assuming the IRS permits the expansion of travel for abortion services as a qualified expense, federal reimbursement programs preempt state law.

However, employers that offer non-ERISA plans and seek to fund coverage for their employees to travel out of state for abortion services could not do so under their health plan if their states impose abortion restrictions. Employers located in states that have passed “trigger laws” (restrictive laws that automatically go into effect in the event Roe v. Wade is overturned) and wish to offer coverage for abortion services, should retain competent legal counsel to review their state laws to determine if there is criminal or civil liability for aiding and abetting the evasion of the laws.

Another potential risk that such employers may face is enforcement initiatives seeking to use laws that prohibit crossing state lines for unlawful purposes, such as the Mann Act. The Mann Act from 1910 makes it a felony to engage in interstate commerce by crossing state lines “for the purpose of prostitution or for any other immoral purpose”. Although unlikely that the current administration would use the Mann Act to prohibit funding state travel to circumvent home state prohibitions on abortion services, future administrations may seek to do so.

Also, some states, such as Missouri, are considering the adoption of state laws that would allow private citizens to sue persons who help a Missouri state resident obtain an abortion by assisting in the travel to an out of state physician for that purpose. This could mean a lawsuit against the employer that assists the employee. As stated, ERISA may be a defense if the travel is under the ERISA Plan or related federal reimbursement plans.

Out of State Providers

ERISA Plans typically use large national networks of providers through their third-party administrators making it likely that network providers will be located in states permitting abortion services. Accordingly, if the Plan is restrictive regarding its use of out of network providers, the plan sponsor may want to consider expanding the use of out-of-network providers for certain services such as abortion-related services or defining the out-of-network emergency exception to include use of providers for abortion related services in exigent circumstances.

Telemedicine

Most abortions today are provided using medication abortion, which can and has been delivered through telehealth. The procedure involves the use of certain medications after a pregnancy is established. These drugs are different from Plan B, morning after pills, which are used soon after the act of intercourse but before a pregnancy is established.

Certain pro-life states (19 to date) require that these services only be provided in the medical office of a health care provider who is licensed in those states, making it impossible to use telehealth within these 19 states for abortions. It is uncertain if the telemedicine modality is available to individuals living in pro-life states using out-of-state providers in pro-choice states without those health care providers running afoul of many laws and regulations including practicing medicine without a state license. Providers in that situation put their medical license at risk for violating the state law where the patient sought the telemedicine services or could become liable for criminal or civil penalties for violating such state laws. As a result, this method of providing pregnancy termination services could be at risk for individuals located in pro-life states, making travel a better option even if just to obtain the medication abortion. It is possible that the federal government through CMS or the FDA may find a way to provide access to telemedicine for medication abortion or simply find another way to provide these medications.

Salary Transparency and Legal Ramifications for New York City Businesses

The New York City Council recently passed Local Law 32, a salary transparency law, which amends the New York City Human Rights Law to require employers to list the minimum and maximum salary range when publicizing new positions. The law applies not only when advertising a job in public media, but also in internal postings regarding promotion or transfer opportunities. The effective date of the law, originally slated to go into effect on May 15, 2022, has been delayed by the New York City Council and will now go into effect November 1, 2022. The delay will allow additional time for compliance by companies. Given that employers could face substantial penalties under this new law for non-compliance, the delay should be viewed as an opportunity to assess hiring procedures and make any necessary changes ahead of its implementation.

The new law applies to all companies with four or more employees, where at least one is located in New York City. Independent contractors are included in the count. Temporary staffing agencies are exempted, as they are already required to disclose wages in compliance with the New York Wage Theft Prevention Act. When this new law goes into effect, it will be considered an “unlawful discriminatory practice” under the NYCHRL if a company does not provide the minimum and maximum salary or hourly range for a position. The range of compensation publicized must be what the employer in good faith believes it would pay at the time the information is posted. It’s important for employers to note that for compliance purposes “salary” refers to base annual pay or hourly wages but does not include employee benefits such as insurance coverage, time off from work, or other forms of indirect compensation. To learn more about the law and its status, you can visit the New York City Council website by clicking here. While there are no fines for first-time violators if the issue is corrected to the satisfaction of the New York City Commission on Human Rights within 30 days, employers deemed to have violated the pay transparency law can be subject to civil penalties of up to $250,000.

We strongly recommend that NYC employers take advantage of the additional time and review current job postings to ensure compliance once the law takes effect. Adherence may require updates to internal and external job advertisements.

The New York employment attorneys of our Labor and Employment Practice Group are available for consultation if you have any questions regarding salary information and transparency. To learn more about the services Bleakley Platt & Schmidt’s Labor and Employment Practice Group has to offer, please click here or contact our office at (914) 287-6144.

Bleakley Platt & Schmidt’s Litigation & Appellate Teams Continue their Success

Bleakley Platt & Schmidt’s litigation and appellate attorneys have been successfully arguing cases since 1937. As a general practice law firm with more than 25 practice areas, our litigation and appellate attorneys can call on the expertise of other practice groups to provide first-rate legal guidance to clients.

Our clientele include local, national, and international companies, as well as sophisticated individuals and several municipalities. We engage in matters ranging from commercial, construction, medical, real estate, intellectual property, product liability, toxic tort and beyond.

The firm also handles civil and criminal appeals at all levels of federal and state practice. Our extensive appellate experience provides a critical edge at each stage of litigation.

Our recent results speak for themselves.

In February 2022, partner Lino Sciarretta and associate Daniel Fix prevailed in a construction/land use dispute. New York’s Appellate Division, Second Department, issued a trio of rulings that cleared the way for construction of an assisted living facility that was being challenged by local civic associations. Our team successfully argued all three appeals.

Also in February, partner Robert Meade secured victory in the New York State Court of Appeals, the State’s highest court. The Court affirmed a favorable decision of the Appellate Division, First Department, for our client, in a dispute involving a $1 million life insurance policy. The trial court had ruled against our client, but Mr. Meade successfully argued for a reversal at the Appellate Division, and the Court of Appeals majority affirmed, over a two judge dissent. Read the opinion here.

In December of 2021, Chairman William P. Harrington and partner Adam Rodriguez successfully obtained the dismissal of a $2 million defamation case amongst rival cell phone companies. We argued among other things that the complaint against our client should be barred on account of New York’s single instance rule. The New York Supreme Court, Commercial Division, agreed with our arguments and dismissed the plaintiff’s complaint against our clients in its entirety.

In November 2021, Harrington and Rodriguez also successfully defended in federal court the dismissal of a $50 million fraud case among former partners in an international shipping company. The District Court granted our motion to dismiss, but the plaintiff appealed to the U.S. Court of Appeals for the Second Circuit. After appellate briefing and oral argument, the Second Circuit affirmed the District Court’s Order. You can read the decision here.

Bleakley Platt & Schmidt continues to provide litigation and appellate guidance and services to clients and communities as we have done for more than 85 years. Click here to learn more about the services our Firm offers or contact our offices at (914) 949-2700.

What Employers Need to Know about New York’s Employee Monitoring Law

In accordance with new Section 52-c of the New York Civil Rights Law, which went into effect on May 7, 2022, New York employers must now notify their employees if they are electronically monitoring workers’ phones, emails, and internet access or usage.  

The new law mandates that all private employers must provide notice of their electronic monitoring practices to new employees upon hiring and obtain written acknowledgement of the monitoring. While employers are not required to obtain written acknowledgement from existing employees, they are required to post the notice in a conspicuous place viewable by all employees.  

The new law applies to any employer with a place of business in New York State, regardless of size, that monitors or intercepts employees’ email, telephone conversations, or internet access or usage. 

Language for the Required Notice: 

There is specific language provided in the new law that employers can utilize as a model to meet the notice requirement: “An employee shall be advised that any and all telephone conversations or transmissions, electronic mail or transmissions, or internet access or usage by an employee by any electronic device or system, including but not limited to the use of a computer, telephone, wire, radio or electromagnetic, photoelectronic or photo-optical systems may be subject to monitoring at any and all times and by any lawful means.” 

Enforcement and Potential Fines 

The New York State Attorney General assumes the authority of enforcing the new law by imposing penalties on employers not in compliance. There is no private right of action. Violators are subject to a maximum fine of $500 for the first offense, $2,000 for the second offense, and $3,000 for the third and subsequent violations.  

Potential Steps Employers Should Consider 

With the new electronic monitoring law, New York employers are strongly encouraged to review their current practices to ensure adherence to the new law. While some employers may already provide some form of notice of electronic monitoring, the changes with the new law may require updates to current onboarding processes for new and recently hired employees as well as revisions to existing employment policies.   

Companies should consider the following in order to avoid penalties: (1) review and analyze existing electronic monitoring practices to evaluate whether there are any activities within the scope of the notice requirements; (2) draft notice language that complies with the new law and update company handbooks as well as access or login portals; (3) institute a process for employees that join the company to receive the notice and provide the required acknowledgement as part of new hire paperwork; (3) post a notice for all company employees in a place that is readily viewable for all employees subject to electronic monitoring regardless of hiring date – perhaps on the company’s internal website for remote/hybrid employees and in a common office space for employees on-site; (4) consider implementing a system to collect and store acknowledgement paperwork so that the notice requirement is adequately documented. 

Exceptions 

Employers should note that the new law does have a few important exceptions to existing processes (1) that manage the volume of inbound or outbound emails, voicemails, or internet usage; (2) which are not targeted to monitor or intercept the electronic mail or telephone voicemail or internet usage of a particular individual; and (3) are performed solely for the purpose of computer system maintenance and/or protection. As a result, the law creates a potential gray area for employers who use employee monitoring systems to achieve multiple goals. 

Movement in Other States  

It is important to note that local, state and federal laws govern the scope of an employer’s monitoring of an employee’s activities and whether employers are required to inform employees that they are being monitored and obtain acknowledgement of the same. For example, other states, like Connecticut and Delaware, have also enacted laws to require written notice to employees about electronic monitoring. Connecticut Gen. Stat.§ 31-48d;  Delaware Del. 6 Code § 19-7-705.  After a current employee-related exemption expires in January 2023, the California Consumer Privacy Act will broaden the requirement to provide notice, and grant employees in California the right to request details of private information that has been collected and how it will be used. Recent movement at the New York State level perhaps signals an even greater movement toward transparency in the workplace.  

Importantly, the employee monitoring law in New York and other states should be considered in conjunction with unionized worker’s rights established in the National Labor Relations Act. 

Questions 

If you have any questions regarding the disclosure of electronic monitoring practices, please consult with our Labor and Employment Practice Group. Click here to learn more about the services Bleakley Platt & Schmidt’s Labor and Employment Practice Group has to offer. 

Bleakley Platt & Schmidt, LLP Announces Sara Keating as New Partner

Bleakley Platt & Schmidt, LLP Announces Sara Keating as New Partner 

WHITE PLAINS, NY—Bleakley Platt & Schmidt is proud to announce Sara L. Keating, Esq. as as the Firm’s newest partner.  Keating will be a member of the Elder Law and Trusts and Estates Practice Groups. 

Prior to joining Bleakley Platt & Schmidt, Keating served as a partner and the principal attorney at her own law firm. Her achievements include being a former Co-Chair of the Elder Law Committee of the Westchester Bar Association and former Vice-Chair of the Medicaid and Guardianship Committees for the New York State Bar Association Elder Law and Special Needs Section. She’s also delivered several presentations in her field of expertise and serves as a personal and property needs guardian for several wards. 

Keating achieved Magna Cum Laude honors while earning her law degree from Quinnipiac College School of Law and is admitted to practice law in New York, Connecticut, and the U.S. District Court Southern District of New York. Sara has previously worked with clients in New York City as well as Westchester, Rockland, Orange, and Putnam counties in New York. She is a member of several professional organizations including the New York State Bar Association and the bar associations of both Westchester and Rockland Counties. She also serves as treasurer for the New York Chapter of the National Association of Elder Law Attorneys and is a member of the Elder Law and Special Needs Section and the Trusts and Estate Section. 

Sara brings an extensive professional background to BPS, enhancing the Firm’s growth trajectory in the New York Metropolitan Area. 

Bleakley Platt & Schmidt, LLP 

Bleakley Platt & Schmidt, LLP is Westchester’s preeminent law firm, with a more than 85-year legacy of providing superior legal counsel to residents and businesses of Westchester and Rockland Counties, as well as the entire Hudson Valley and Fairfield County, CT. To learn more about the Firm’s services, visit www.bpslaw.com, or contact its offices at (914) 949-2700. 

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The Americans with Disabilities Act: Does your website need to comply?

By Adam Rodriguez, Esq.

Should you care if your business’ website is ADA compliant?

Absolutely. Litigating a website accessibility case can be expensive, even if you are ultimately successful on the merits. This is particularly true because the ADA provides for an award of attorneys’ fees to a prevailing party. It may be best to proactively address your website’s accessibility to ensure meaningful access for persons with disabilities. But, if you are sued, there are strong arguments that can be marshalled to defeat the claim or negotiate a favorable settlement. The lawyers at Bleakley Platt can help.

What does the ADA say?

The ADA states that “[n]o individual shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation by any person who owns, leases . . . or operates a place of public accommodation.” 42 U.S.C. § 12182(a). The statute provides several examples of public accommodations, all of which are physical places, including an inn, a restaurant, a movie theater, etc. 42 U.S.C. § 12181(7).

Does the phrase “place of public accommodation” include your website?

Unfortunately, the answer may depend on what court you are in.

Notwithstanding the plain text of the ADA, Courts are split on this issue. For example, the Third Circuit has interpreted “places of public accommodation” narrowly, concluding that the ADA only applies to physical locations. In Peoples v. Discover Financial Services, Inc., 387 F. App’x 179 (3d Cir. 2010), the plaintiff—a blind man—sued a credit card company alleging fraud after he used his credit card for a prostitute’s services at her in-home business, resulting in her allegedly overcharging him and the card company refusing to credit his account for the disputed amounts. The Third Circuit held that, because the alleged discrimination did not happen on the defendant’s physical property, the claim was not cognizable.

Whereas the First Circuit, in Carparts Distribution Ctr., Inc. v. Auto. Wholesaler’s Ass’n of New England, 37 F.3d 12, 19 (1st Cir. 1994), held that public accommodations are not “limited to actual physical structures.” In Carparts, the plaintiff brought an action against the defendant health plan, alleging that a lifetime cap on health benefits for individuals with AIDS instituted by the health plan represented illegal disability discrimination. The First Circuit reversed the district court, holding that Congress did not intend for the ADA to apply only to physical structures.

The recent trend of federal caselaw seems to favor the defendants. For example, the Eleventh Circuit recently held in Gil v. Winn-Dixie Stores, Inc., 993 F.3d 1266 (11th Cir. 2021), vacated as moot, No. 17-13467 (11th Cir. December 28, 2021), that the definition of “public accommodation” does not include websites, but instead only includes physical places. In that case, the plaintiff had a visual impairment, and used screen reading software to browse websites. But plaintiff’s screen reader software didn’t work with Winn-Dixie’s website’s prescription refill functionality.

The Second Circuit Court of Appeals has not squarely addressed the issue, and the district courts are split. For example, in Winegard v. Newsday LLC, 2021 U.S. Dist. LEXIS 153995, at *2 (E.D.N.Y. Aug. 16, 2021), Judge Komitee concluded that the “ADA excludes, by its plain language, the websites of businesses with no public-facing, physical retail operations” from the definition of “public accommodations.” But a few months later, Judge Wood held that “that websites qualify as places of ‘public accommodation,’ albeit electronic ones, and, as such, are required to provide equal services to visually impaired and sighted people.” Romero v. 88 Acres Foods, Inc., 2022 U.S. Dist. LEXIS 9040, at *16 (S.D.N.Y. Jan. 18, 2022).

If the ADA Applies, Does Your Website Comply?

Maybe. If the ADA does apply to your website, it does not require conformity with any specific standard. In fact, the U.S. Department of Justice (“DOJ”) has made it very clear that “noncompliance with a voluntary technical standard for website accessibility does not necessarily indicate noncompliance with the ADA.” Letter from Stephen E. Boyd, Asst. Atty. General, to Hon. Ted Budd, U.S. House of Representatives (Sep. 28, 2018).

Some courts have used the Web Content Accessibility Guidelines (“WCAG”) version 2.0 and 2.1 Level AA standards as a remedial measure for non-compliance. For example, in Robles v. Domino’s Pizza, LLC, 913 F.3d 898, 907 (9th Cir. 2019), the Ninth Circuit held that “the district court can order compliance with WCAG 2.0 as an equitable remedy if, after discovery, the website and app fail to satisfy the ADA.” The consensus is that if a website adheres to this standard, it is sufficiently accessible to individuals with disabilities.

In addition, DOJ has taken the position that covered entities with inaccessible websites may comply with the ADA “by providing an accessible alternative, such as a staffed telephone line, for individuals to access the information, goods, and services of their Web site.” Nondiscrimination on the Basis of Disability, 75 Fed. Reg. at 43466. So, if your website provides keyboard accessible 24-hour chat and phone lines, for example, to address any accessibility issues that arise, you can mitigate the risk of potential non-compliance.

Adam Rodriguez focuses his practice in the areas of commercial litigation, municipal law, intellectual property and real estate. He currently serves as the Yorktown Town Attorney, acting as legal counsel to the Town, its elected officials, department heads, and its various boards. Before joining Bleakley Platt, Mr. Rodriguez was the Director of Real Estate for Westchester County, where he negotiated complex commercial real estate transactions valued at over $100 million. Prior to his appointment as Director of Real Estate, Mr. Rodriguez defended the County of Westchester in one of the highest-profile HUD enforcement actions in United States history. He has also served as a law clerk to two federal judges, and has worked as a litigator at a large law firm in New York City.

To read Mr. Rodriguez’s attorney profile, click here.

Bleakley Platt & Schmidt Proud to Support Return of AOH St. Patrick’s Day Parade to Rockland County

After two years of canceled events due to the COVID-19 pandemic, the Rockland County Ancient Order of Hibernians (AOH) helped bring joy back to the Hudson Valley on Sunday, March 20th with the return of its St. Patrick’s Day parade – the second-largest in New York State!

Bleakley Platt & Schmidt, LLP Announces David S. Handsman as Newest Partner

Bleakley Platt & Schmidt, LLP Announces David S. Handsman as Newest Partner

WHITE PLAINS, NY—Bleakley Platt & Schmidt, LLP is happy to announce David S. Handsman, Esq. as the Firm’s newest Partner. Handsman joins the Firm’s Real Estate and Commercial Finance practice groups.

Handsman’s field of expertise lies in commercial office and retail leasing, real estate financing, acquisitions, divestitures, and operating agreements. Handsman was recognized as a Super Lawyer in 2020 and 2021, showcasing his high degree of peer recognition and professional achievement. He is a member of the New York State Bar Association’s Commercial Leasing Section.

Handsman graduated from George Washington University before later earning his law degree from the New York Law School and is admitted to practice law in the state of New York. Prior to joining the Firm, Handsman represented real estate developers, owners, not-for-profit companies and operators of real property in various parts of the Northeastern region of the United States.

David brings more than 30 years of experience and knowledge to Bleakley Platt & Schmidt, strengthening the firm’s real estate practice and boosting the Firm’s growth.

Bleakley Platt & Schmidt, LLP

Bleakley Platt & Schmidt, LLP is Westchester’s preeminent law firm, with a more than 85-year legacy of providing superior legal counsel to residents and businesses of Westchester and Rockland Counties, as well as the entire Hudson Valley and Fairfield County, CT. To learn more about the Firm’s services, visit www.bpslaw.com, or contact its offices at (914) 949-2700.

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Bleakley Platt & Schmidt, LLP Opens New Rockland County Office

Bleakley Platt & Schmidt, LLP, a Westchester-based law firm with a history spanning more than eight decades, has opened its first Rockland County office.

Frequency of Pay Issues for “Manual Workers” Continue to Present Significant Liability Risks for New York Employers

New York Labor Law (NYLL) Section 191 mandates that employers must pay “manual workers” on a weekly basis within seven calendar days of the week during which the wages are earned. If manual workers are not paid on this weekly basis, recent cases continue to confirm that these employees have a private right of action under Section 191 to seek to recover liquidated damages, which are now mandatory under Section 198(1-a) even though the “manual workers” were paid in full the following week.

Bleakley Platt Partner Lino Sciarretta Obtains Significant Land Use Rulings in New York’s Appellate Division

Good things come to those who persevere.

Since 2014, BPS partner Lino Sciarretta has represented Formation-Shelbourne Senior Living Services in connection with its plan to construct an assisted living facility in the Town of Greenburgh, New York. The plan was met with fierce opposition by various civic associations, as well as by the Greenburgh Fire District (“GFD”), but after an approval process that spanned more than three years the necessary permits and approvals were obtained. Then came the litigation.

Can the Law Regulate the Internet? How Government Agencies Seek to Regulate Big Tech

In comparison to radio, television, and telephone, newer technologies – particularly those involving the internet and social media – have remained largely unregulated by federal or state governments, with the tech industry relying on self-governance even as their influence has significantly expanded. As tech plays an increasingly large role in daily life and tech companies grow in size and number, however, a legal framework to curb such power is taking shape. Can the government regulate an industry famous for rapid change? The federal government has now turned its attention to answering that question.

How Medical Testing Laboratories Must Comply with the Federal Ban on “Surprise Billing”

The “No Surprises Act” (“NSA”), which became effective on January 1, 2022, is federal legislation designed to protect patients from “surprise medical billing” that occurs when a patient receives services from a facility or provider which, unknown to the patient, is outside of his or her health plan’s network, resulting in unexpected out-of-network charges. Much of the discussion surrounding surprise medical billing has been focused on emergency services/treatment where the patient is unable to choose the medical provider.

What to Know About New York’s Green Amendment  

On November 2, 2021, New York residents voted to amend the State’s constitution to enshrine into law each person’s “right to clean air and water, and a healthful environment.” N.Y. Const., Art. 1, Sec. 19. With the adoption of this amendment, New York becomes the third state in the nation to include environmental rights in its Bill of Rights, following Pennsylvania (1971) and Montana (1972. Four other states – Hawaii, Illinois, Massachusetts and Rhode Island – have constitutional provisions regarding environmental protections, although not in their Bill of Rights.

Baffling Issues that Arise in Insurance Mediations (and How to Get Past Them!)

Partner John Diaconis will be a panelist on this informative program presented by the Insurance Dispute Resolution Committee of the New York State Bar Association, to be held at 5:30 PM on December 15, via Zoom.

The No Surprises Act and How Medical Providers Must Comply with the Federal Ban on Surprise Billing

The “No Surprises Act” (“NSA”), new federal legislation intended to protect patients from “surprise medical billing”, goes into effect on January 1, 2022. While most states have already enacted laws to address surprise billing, limited protections and various loopholes permitting balance billing at the state level compelled federal action to address the need for greater consumer protection.

As Deadline Looms, New York Municipalities Decide Whether To Prohibit Retail Cannabis Dispensaries and On-Site Consumption Sites

Under New York’s Marijuana Regulation and Taxation Act (MRTA), which became law on March 31, 2021, the State’s cities, towns and villages have until December 31, 2021 to decide whether to “opt out” of allowing retail marijuana dispensaries and on-site consumption sites within their jurisdictions. The deadline has prompted considerable public debate as residents of Westchester County and across the State make their views known to their local government leaders and representatives. The Rockefeller Institute for Government has created a searchable online “Marijuana Opt-Out Tracker,” showing the current status in each municipality.

Partner Susan Galvão Joins Board of Visitors at Elisabeth Haub School of Law

Bleakley Platt & Schmidt congratulates managing partner Susan Galvão on joining the Board of Visitors of her alma mater, Elisabeth Haub School of Law at Pace University, where she is also a member of the Women & the Law planning committee. To read more about Susan’s involvement with the Law School and to learn about its Board of Visitors, click here.

Partner Jim Glatthaar Presenter at Well-Attended Landlord-Tenant Law CLE

Last month, Bleakley Platt partner Jim Glatthaar was one of two presenters of a 2-hour CLE webinar sponsored by Judicial Title Insurance Agency LLC, entitled “The Everchanging State of Landlord-Tenant Law: Where Do We Stand Today?”

Partner Jim Glatthaar Featured in Habitat Magazine

Bleakley Platt partner Jim Glatthaar is featured in the November 2021 issue of Habitat Magazine, a print and on-line magazine for the members of cooperative and condominium boards.  In the November issue, Jim discusses the importance of boards being proactive when addressing property repairs which cause damage to residents’ property and which cause the residents to vacate their apartments for extended periods.

Harrington & Rodriguez Obtain Dismissal of $50 Million Fraud Case

Chairman William P. Harrington and Partner Adam Rodriguez recently upheld a dismissal in a fraud case among former partners in an international shipping company.

New York Enacts Mandatory Retirement Savings Program Participation for Employers

On October 21, 2021, Governor Hochul signed legislation requiring all private sector employers who meet certain threshold criteria to participate in New York State’s Secure Choice Savings Program (SCSP). The legislation applies to all for-profit and non-profit employers who employed 10 or more employees in 2020, have been in business for at least two years, and do not already offer a qualified retirement plan to their employees.

Investigating Employee Misconduct and Defending Claims of Wrongful Termination

With wrongful termination lawsuits on the rise across many industries, it has become more important than ever for employers to conduct thorough and well-documented investigations of alleged employee misconduct before deciding whether to impose disciplinary measures against an employee. This point was recently confirmed by the Second Department’s decision in Daniel Hutting v. Independent Living, Inc., _ A.D.3d _ (2d Dep’t Oct. 13, 2021), an appeal successfully argued on behalf of the defendant employer by Bleakley Platt partner Joseph DeGiuseppe, Jr.

Update: New York’s Governor Extends to October 31, 2021 Employers’ Obligation to Implement Their Exposure Prevention Plans under NY’s HERO Act

On September 30, 2021, Governor Kathy Hochul extended, until October 31, 2021, her prior designation of COVID-19 as a highly contagious communicable disease, thereby requiring employers to continue to implement their infectious disease prevention plans under New York’s HERO Act.

The Intersection of NYS and Westchester County Sick and Safe Leave Laws-One Year Later

New York State’s paid sick leave law (“PSLL”), which went into effect on September 30, 2020, mandates the payment of both sick and safe time leave to employees effective January 1, 2021. Also included within the purview of the PSLL is the availability of paid leave for “safe time” which includes absences from work when an employee or his/her “family member” has been the victim of domestic violence as defined by the State Human Rights Law (“SHRL”), a family offense, sexual offense, stalking, or human trafficking. As discussed below, the Westchester County Safe and Sick Leave Law, which went into effect on October 30, 2019, already required sick and “safe time” for Westchester County employees. As of September 30, 2020, Westchester County adopted the sick leave provisions of the NYS law but made it clear that it did not preempt the County’s Safe Time Leave Law (“STLL”). Unfortunately for employers, Westchester County has not issued any further guidance on the intersection of the two laws which differ in certain material respects as to the use of paid leave and the definitions of certain key terms under the respective laws.

Bleakley Platt & Schmidt Sponsors GAA Golf Outing and Supports Gaelic Heritage

Bleakley Platt & Schmidt LLP is proud to support our client, the Rockland Gaelic Athletic Association (the “GAA”), and to have served as a sponsor at their golf outing held on September 22, 2021, at the Blue Hill Golf Course in Pearl River, New York. The GAA is well-known in Rockland County, as well as internationally, for its tremendous work promoting Irish culture and heritage through the teaching and playing of traditional Gaelic games and hosting community events showcasing traditional Irish music, song, and dance. The GAA began operating in Rockland in 1972 and is home to over 850 playing members from ages 6 to adult and fields over 20 teams playing football, hurling, ladies’ football, and camogie. In 2017, the GAA opened its state-of-the-art clubhouse and pavilion next to its playing fields in Orangeburg, New York. In addition, the GAA and its members routinely give back to the local community and can be counted upon to support those in need through their various charitable endeavors.

Pictured below are photos of the sponsorship signs from the golf outing, the GAA clubhouse, and Bleakley Platt attorney John W. McGowan, who serves as general counsel to the GAA, along with other participants in the golf outing (last photo courtesy of the GAA).

Extending The Eviction Moratorium and More: New Changes In Commercial Eviction Procedures in New York

Effective September 2, 2021, a new law extended New York’s moratorium on commercial and residential evictions to January 15, 2022, while also enacting several other significant measures of which all commercial landlords and managing agents should be aware.

Employers’ Obligation to Implement Their Exposure Prevention Plans Triggered by Formal Designation of COVID-19 as a “Highly Contagious Communicable Disease” under NY’s HERO ACT

On September 6, 2021, New York Governor Kathy Hochul announced that the NYS Department of Health has designated COVID-19 as a “highly contagious communicable disease that presents a serious risk of harm to the public health” under New York’s HERO Act. This formal designation has immediate significance for all New York employers.

Harrington & Rodriguez Secure Dismissal of Defamation Case

Chairman William P. Harrington and Partner Adam Rodriguez recently secured a complete victory in a defamation case among rival cell phone companies.

The plaintiff, Red Pocket Inc., alleged that our clients US Mobile and its founder/CEO made defamatory comments about Red Pocket on a mobile phone services podcast, and sought $2.5 million in damages.

We filed a motion to dismiss, arguing that the Complaint should be dismissed because Red Pocket failed to plead a statement that is defamatory on its face. In addition, we argued that the Complaint was barred under New York’s single instance rule. Under the rule, language charging a plaintiff with ignorance or mistake on a single occasion only, and not accusing general incompetence, or lack of basic integrity or creditworthiness, cannot be considered defamatory on its face and so is not actionable unless special damages are pleaded.

In a thorough decision, Judge Linda S. Jamieson of the N.Y. Supreme Court Commercial division agreed with our arguments, and dismissed the complaint filed against our clients in its entirety.

Mr. Harrington

Mr. Harrington is Chairman of the Firm’s Executive Committee. He is the head of the Litigation and Toxic Tort/Complex Litigation Practice Groups. Mr. Harrington is an experienced trial attorney who has represented Fortune 500 companies in criminal, commercial, environmental, civil rights, real estate, gaming and employment discrimination matters. His clients have included major oil companies, pharmaceutical companies, hospitals, racetracks/casinos, financial institutions and significant regional companies in all aspects of complex environmental, toxic tort and commercial litigation. Mr. Harrington also represents both municipalities and developers in all phases of land use development and related litigation.

To read Mr. Harington’s attorney profile, click here.

Mr. Rodriguez

Mr. Rodriguez focuses his practice in the areas of commercial litigation, municipal law, intellectual property and real estate. He currently serves as the Yorktown Town Attorney, acting as legal counsel to the Town, its elected officials, department heads, and its various boards. Before joining Bleakley Platt, Mr. Rodriguez was the Director of Real Estate for Westchester County, where he negotiated complex commercial real estate transactions valued at over $100 million. Prior to his appointment as Director of Real Estate, Mr. Rodriguez defended the County of Westchester in one of the highest-profile HUD enforcement actions in United States history. He has also served as a law clerk to two federal judges, and worked as a litigator at a large law firm in New York City.

To read Mr. Rodriguez’s attorney profile, click here.

New York’s Construction Industry Wage Theft Bill: Prime Contractors in New York Now Liable for Unpaid Wages Owed To Subcontractors’ Employees

On September 6, 2021, NY Governor Hochul signed into law the Construction Industry Wage Theft bill (S2766C), imposing joint and several liability on prime contractors for the wage and benefit claims of their subcontractors’ employees. Effective January 4, 2022, the new law covers claims for unpaid wages, benefits and wage supplements as defined by NY Labor Law § 198, and thus covers not only wages but also reimbursable expenses, health and retirement benefits, and vacation, separation and holiday pay.  

The law also incorporates and applies to prime contractors all other remedies available to employees under NYLL § 198, including liability for an additional amount, up to 100% of the unpaid wages, as liquidated damages (and up to 300% where a willful violation is shown); attorneys’ fees; prejudgment interest; and other potential penalties. It bears noting that contractors may contract for indemnification by subcontractors and may maintain an action against a subcontractor to recover owed wages that are paid by the contractor. The law applies to all non-union contracts and employees. 

The obligations imposed by this new law may already exist for those general contractors who are deemed to be a “joint employer” under applicable federal and NYS wage and hour laws. However it effectively expands “joint employer” liability to include employers beyond those currently recognized under these wage and hour laws, and provides remedies which may not in any event be available under federal law.  

In light of the risks of liability created by this new law, prime contractors in New York would be well advised to develop strong indemnification provisions for their subcontracts, as well as auditing and other contract management practices to ensure that their subcontractors’ non-union employees are receiving all wages and benefits to which they are entitled. 

Bleakley Platt’s employment and construction law attorneys are continuously monitoring legal developments relevant to their clients’ interests. If you have any questions regarding this alert, please contact Joseph DeGiuseppe at jdegiuseppe@bpslaw.com | 914-287-6144, or Jonathan Murphy at jamurphy@bpslaw.com | 914-287-6165. 

Emergency Regulation on Mandatory Vaccinations for Health Facility Workers

The Public Health and Health Planning Council and the Commissioner of Health approved emergency regulations on August 26, 2021 to help combat the increasing circulation of the SARS-CoV-2 Delta variant. When filed, the new regulations will supersede the order announced August 16 by Governor Andrew M. Cuomo for hospital and nursing home workers, but without any religious exemption from the vaccination requirement.

Trademark Modernization Act Signed Into Law for Federal Trademark Owners in New York and Beyond

The United States Patent and Trademark Office signed the Trademark Modernization Act (“TMA”) into law last year, prompting future changes for federal trademark owners in New York state and nationally. The Act will formally be implemented on December 27th, 2021. Although the TMA offers trademark owners additional tools, it also expands trademark cancellation mechanisms that might cause some trademark holders to lose their federal trademark.