Category Archives: Miscellaneous

• posted: Dec. 07, 2017
• Kyle M. Winslow
• Uncategorized

Written By: Kyle M. Winslow

Today, appearance of lawyers on a pro hac vice basis is more common than ever.  Our law firm serves as local counsel for out-of-state attorneys in a variety of litigation cases.  Additionally, we often work with local counsel who serve our clients in other jurisdictions.  Because of the time-sensitive nature of litigation, this article seeks to simplify the pro hac vice procedure in Kentucky state and federal courts.

Admission to practice before a Kentucky state court

Out-of-state lawyers who are not licensed to practice law in the Commonwealth of Kentucky and seek to appear before a Kentucky court must comply with Kentucky’s pro hac vice rule, Supreme Court Rule (“SCR”) 3.030.

First, the attorney seeking admission must submit a pro hac vice certification form through the Kentucky Bar Association (“KBA”).  This form can be found here. At the same time, the KBA requires a per case/per attorney fee in the amount of $310, plus an administrative processing fee of $10.85.

Second, the party wishing for counsel to appear pro hac vice must file a motion requesting permission for its out-of-state lawyer to appear in the case.  While SCR 3.030 does not explicitly state that a motion is required, it implies as much. SCR 3.030(2) (“No motion for permission to practice…shall be granted without submission…of a certification from the Kentucky Bar Association of receipt of this fee”) (emphasis added).  The motion must contain specific information to ensure compliance with SCR 3.030.  Prudent attorneys typically attach an affidavit with the following statements from the attorney seeking pro hac vice admission:

• The lawyer subjects himself or herself to the jurisdiction and rules of the Supreme Court of Kentucky.
• The lawyer paid the one-time per case fee required by SCR 3.030. The motion or the affidavit must attach a certification from the KBA of receipt of this fee.  The receipt is in the form of an invoice sent from the KBA.
• The lawyer has engaged a member of the KBA as co-counsel.
• The Kentucky attorney serving as co-counsel will attend all trials and will be present at any other times when required by the court.

In addition to the above, the party seeking admission of an out-of-state lawyer should also review the applicable local rules to determine if any additional requirements exist.

Admission to practice in Kentucky federal courts

Joint Local Rule 83.2 governs pro hac vice admission in Kentucky federal courts.

Local Rule 83.2 also requires a party wishing for counsel to appear pro hac vice to file a motion.  The attorney seeking admission must also pay a pro hac vice admission fee in the amount of $125 to the Clerk of Court.  Unlike the state-court requirements, a lawyer seeking pro hac vice admission does not need to pay the one-time case fee imposed by the KBA for state-court cases.  Additionally, the federal fee is paid when you submit the motion through the court’s electronic filing system.  Accordingly, fee payment and filing of the motion can be completed in one process.

Like the state-court motion, a motion for pro hac vice admission must include specific information.  An affidavit should be attached to the motion with the following statements from the attorney seeking pro hac vice admission:

• Identification of each bar in which the attorney is a member. Additionally, the attorney must attach a certificate of good standing issued by the highest court of the state in which the attorney is a resident.  The certificate of good standing must be issued no more than ninety (90) days before the filing of the motion.
• Whether the attorney is currently or has ever been disbarred, suspended from practice, or subject to other disciplinary action by any court, state, territory, or the District of Columbia.
• That the attorney consents to be subject to the jurisdiction and rules of the Kentucky Supreme Court governing professional conduct.
• Identification of the method of training completed by the attorney before the use of the Court’s electronic filing system. For those attorneys who have been trained on the federal electronic filing system, we simply state that the attorney “has been trained on the use of the CM/ECF systems by the other federal courts in which he has been admitted to practice and has a working familiarity with CM/ECF systems employed by the federal courts.”

A party’s compliance with the above requirements should pave the way to pro hac vice admission.  It bears mentioning, however, that judges require strict compliance with the admission requirements.  In fact, at a recent “cattle-call” docket, the author of this article observed a judge deny multiple pro hac vice motions for failure to attach the KBA receipt.  Additionally, this office has seen federal judges deny opposing parties motions for pro hac vice admission for failure to attach the requisite certificate of good standing.

About Finney Law Firm, LLC

Founded in 2014, FLF has grown to 15 attorneys located in offices in Eastgate and downtown Cincinnati with five major practice areas: Corporate Law, Real Estate Law, Employment Law, Commercial Litigation and Public Interest and Constitutional Litigation.  FLF has the unique claim to three 9-0 victories at the United States Supreme Court for its public interest practice along with breakthrough class action work.

FLF also has an affiliated title insurance company, Ivy Pointe Title, LLC, that closes and insures nearly a thousand commercial and residential real estate transactions annually.

For more information about Finney Law Firm, visit finneylawfirm.com.

Media Contact: Mickey McClanahan; mickey@finneylawfirm.isoc.net; 513.797.2850.

 

• posted: Nov. 30, 2017
• Todd McMurtry
• Uncategorized

Written By: Todd V. McMurtry

As a Kentucky lawyer, who lives on the Ohio border, I have seen Ohio lawyers, not licensed to practice law in Kentucky, “cross the river” to handle Kentucky cases. I have always cautioned these lawyers to tread carefully as Kentucky’s rules that govern the practice of law are stricter than one might expect. For example, may an attorney not licensed in Kentucky undertake a preliminary investigation of a case over which the courts of the Commonwealth will have jurisdiction? The short answer, yes.  But, an out-of-state attorney may not offer legal advice on the Kentucky matter until that attorney has affiliated with local counsel. Then, once the case is filed, the out-of-state attorney must seek pro hac vice admission and pay the one-time case fee pursuant to Supreme Court Rule (SCR) 3.030(2). While this is a strict interpretation of Kentucky’s Rules of the Supreme Court, it is based upon their plain language. As well, when compared to the American Bar Association’s Model Rules, the Kentucky rules do not provide a specific safe harbor for an attorney, not licensed in Kentucky, to undertake a preliminary investigation before associating with local counsel.

SCR 3.020 Practice of law defined describes the practice of law as “any service rendered involving legal knowledge or legal advice, whether representation, counsel or advocacy in or out of court, rendered in respect to the rights, duties, obligations, liabilities, or business relations of one requiring the services.”  SCR 3.130 (5.5) Unauthorized practice of law; multijurisdictional practice of law governs when and how a lawyer not licensed to practice law in the Commonwealth may do so. Section (a) of the rule states, “a lawyer shall not practice law in a jurisdiction in violation of the regulation of the legal profession in that jurisdiction . . .”  Section (c) states, “A lawyer admitted in another United States jurisdiction . . . may provide legal services on a temporary basis in this jurisdiction if such services: (1) comply with SCR 3.030(2) . . .”  This rule states, “A person admitted to practice in another state, but not in this state, shall be permitted to practice a case in this state only if that attorney subjects himself or herself to the jurisdiction and rules of the Supreme Court of Kentucky, pays a one-time per case fee equal to the annual dues paid by those KBA members who have been admitted to practice law for five years or more to the Kentucky Bar Association and engages a member of the Association as co-counsel, whose presence shall be necessary at all trials and at other times when required by the court.”

Compare Kentucky’s rule with the American Bar Association’s Model Rule 5.5, which permits out-of-state lawyers to provide legal services on a temporary basis when they “are undertaken in association with a lawyer who is admitted to practice in this jurisdiction and who actively participates in the matter.” Rule 5.5 (c)(1).  The ABA rule  does not require the payment of fee. The Kentucky rule requiring payment of a fee creates confusion, because it does not advise a lawyer of what he is to do before suit is filed. Must he pay a fee to contact a witness to determine if the case is worth pursuit?

Another exception provided by the ABA Model Rule provides that an out-of-state lawyer may provide legal services on a temporary basis when the services relate to a pending or potential proceeding and when that lawyer reasonably expects that he will be authorized to appear. Rule 5.5 (c)(2). The ABA’s model rules provide guidance on the proper method for out-of-state attorneys wishing to investigate cases in other states and clearly permits them to do so. The Kentucky rules do not.

Fortunately, the Kentucky Supreme Court commentary acknowledges that “Paragraph (c)(1) recognizes that the interests of clients and the public are protected if a lawyer admitted only in another jurisdiction associates with a lawyer to practice in this jurisdiction.” SCR 3.130, cmt. 8. This comment goes on to state that the Kentucky attorney “must actively participate in, and show responsibility for the representation of the client.” Id.

So, for an Ohio attorney, whose client was injured in a car accident in Kentucky to provide “any service rendered involving legal knowledge or legal advice,” such service can only be provided where a Kentucky attorney actively participates. When a case has already been filed, and the attorney reasonably expects to be admitted pro hac vice, that lawyer may provide services on a temporary basis.

This analysis should give special pause to business lawyers, who have no means to seek pro hac vice admission, which provides the Court’s imprimatur that he may practice law in the state. At a minimum, out-of-state attorneys should affiliate with a Kentucky attorney whenever providing legal services, be that the negotiation of a contract or the investigation or a real estate transaction. Such activities require the active involvement of a Kentucky licensed attorney. The alternative is to take your chances.

About Finney Law Firm, LLC

Founded in 2014, FLF has grown to 15 attorneys located in offices in Eastgate and downtown Cincinnati with five major practice areas: Corporate Law, Real Estate Law, Employment Law, Commercial Litigation and Public Interest and Constitutional Litigation.  FLF has the unique claim to three 9-0 victories at the United States Supreme Court for its public interest practice along with breakthrough class action work.

FLF also has an affiliated title insurance company, Ivy Pointe Title, LLC, that closes and insures nearly a thousand commercial and residential real estate transactions annually.

For more information about Finney Law Firm, visit finneylawfirm.com.

Media Contact: Mickey McClanahan; mickey@finneylawfirm.isoc.net; 513.797.2850.

 

• posted: Oct. 19, 2017
• Todd McMurtry
• Uncategorized

Written By: Todd V. McMurtry

I recently spoke at the Kentucky Bar Association’s Kentucky Law Update on behalf of the Alternative Dispute Resolution Section. One of the topics I addressed related to whether mediators should be credentialed. In general, the concept of requiring a mediator to be credentialed is similar to a lawyer being licensed to practice law or a doctor being licensed to practice medicine. Today, mediators are not credentialed. They may be trained, but they are not required to pass a test.

As I discussed at the seminar, two major institutions recently have considered the issue of credentialing. They are the ABA Task Force on Mediator Credentialing and the International Mediation Institute. The ABA Task Force issued its final report on credentialing to which the International Mediation Institute responded. Both organizations concluded that requiring mediators to become credentialed would not necessarily improve the quality of mediations. Their findings focused on the idea that parties choose mediators whom they know get results. These two bodies did not want to artificially limit the available mediators by requiring them to pass a test. In essence, they concluded that there may be an advantage to provide minimum qualifications through credentialing, but a mediator’s ability to be effective is governed as much by that person’s personality and knowledge of the law as by their training.

I had the opportunity to offer my opinion to the attorneys gathered for the seminar. I agreed with the ABA Task Force’s opinion. But, I did endorse the idea that mediators are well served to attend formal mediation training. I attended the Harvard Mediation Institute, and found it to be extremely helpful. The advantage of obtaining an education in mediation, as opposed to simply doing what works, is that formal instruction does provide additional tools that one may not know. (There is more than one way to obtain a successful result in mediation). As well, to attend a program like Harvard’s exposes the participant to many other successful mediators and mediation strategies.

So, while I do not think that mediators should have to obtain credentials to serve as a mediator, I do think it is a good idea to make the effort to undergo the more formal training provided by schools like Harvard and Pepperdine, both of which are recognized as the best programs in the United States.

Todd V. McMurtry is a Member at Hemmer DeFrank Wessels, PLLC.  He is a commercial trial attorney and Harvard trained mediator.  Todd has been married to his wife, Maria C. Garriga, for 32 years.  They have three adult children.

 

• posted: Oct. 19, 2017
• Janie Ratliff
• Uncategorized

Written By: Janie Ratliff-Sweeney

True Story:  I recently met with a client who had a disgruntled ex-employee file a complaint with the Office of Civil Rights (the enforcement arm of the HIPAA Privacy and Security Rules) alleging violations of the HIPAA Privacy Rules by the client.  The client had experienced an inadvertent disclosure of protected health information (PHI) more than a year prior to the ex-employee’s filing of the OCR complaint.  The specific facts about the inadvertent disclosure of the PHI are not particularly unusual or sexy – an email containing the PHI of several patients was sent in error to the wrong email address.  These types of inadvertent disclosures are bound to happen.  Once the client learned of the email incident, it took what it considered appropriate action at the time and then filed away the incident to gather dust.  Unfortunately, the ex-employee too had filed away the incident – only to blow off the dust and resurrect it in a complaint filed with the OCR.  According to the OCR inquiry letter received by the client, the ex-employee alleged the client had not acted in compliance with HIPAA in its response to the email incident.  The OCR inquiry letter also contained the usual “data request” portion which required the client to submit to the OCR copies of its written policies and procedures related to safeguarding PHI, breaches, notifications of breaches, and the like.  So, the client not only faced defending its actions arising out of an incident from more than a year prior; the client had to also provide copies of its written policies and procedures.  After filing its response to the OCR, the client now sits and waits for its actions and documents to be judged by the OCR.  If the OCR judges the actions and/or documents of the client are not adequate or violated HIPAA, on to the next step:  the levying of fines.  But, regardless as to whether the client’s actions were HIPAA compliant, the client expended valuable resources (time and money) in drafting a response to the OCR and in gathering its documents.

Fines: “Fines schmines!” you say.  “Cost of doing business!” you say.  Right?  Wrong.

Have you paid attention to the fines the OCR has doled out recently?  Ranging from hundreds of thousands of dollars to millions of dollars.  During March of 2016, the OCR levied more than $5 million dollars in one week!  Levied for things ranging from lost laptops to IT system hacks.  Depending on the facts and circumstances of the violation, fines can climb upwards of nearly $56,000 per violation.  Do you want to be the physician or practice/facility administrator trying to split hairs with the OCR as to what constitutes “one” violation when an email is inadvertently sent to the wrong addressee and the email contains the PHI of 100 patients?  If that’s “one” violation (and depending on the facts and circumstances), that may be a check for $56,000.  Phew!  If it’s 100 violations… well… you do the math.

That check to the OCR contains hard earned dollars that will not otherwise be available for distribution to the owners or employees of your practice or facility, or to pay any of your practice’s or facility’s anticipated expenses.  Of course, that amount does not include the cost of hiring a health care attorney conversant in the HIPAA Privacy Rules.  Such expertise is vital in any dealings with the OCR or when viewing your practice’s or facility’s compliance with HIPAA.

Let’s Test your HIPAA IQ – Query me the following:  Would you know what steps are required to be taken upon the discovery of an inadvertent disclosure of PHI?  Do you know what is involved with a HIPAA-complaint “risk assessment”?  Do you know whether notices must be sent to patients following an inadvertent disclosure of PHI?  If so, do you know what the requirements are as to the form and substance of such notices?  Do you know the time frame in which a practice must investigate and take action following its knowledge of an inadvertent disclosure of PHI?  When was the last time your employees received HIPAA initial training or re-fresher training?

If your answer to any of the above is “no” or “I don’t know”, you are subjecting your practice or facility to large fines – sticking your head in the sand will not solve the problem.  Taking on the “it won’t happen to me” attitude will also not solve the problem.  The reality is that OCR is ramping up enforcement actions and it is levying fines at will.

STUFF Happens – Humans are Human:  Human error.  It is rampant.  No matter how much training you conduct and no matter how many policies and procedures you have in place – stuff happens.  People make mistakes.

As such, it is prudent to understand what you need to do when a staff member in your practice or facility makes a mistake and sends that email to the wrong person.  It is prudent to have in place appropriate safeguards to prevent human error – but the fact of the matter is that it is impossible to wave a wand and suddenly make every single employee perfect and without error.

Stuff happens.

Be prepared.

Educate yourself.

Know what you are obligated to do when the PHI is inadvertently disclosed.  Know whether a breach has occurred.  Know what you have to do if a breach has occurred.  Know what a patient notification letter is required to contain.  Know the time frame within which a patient notice must be sent.  Know whether you have to notify the OCR immediately or at the end of the year.  Know whether you must notify the media.

As the FRAM man once said – “you can pay me now or pay me later”.  When it comes to HIPAA compliance, a little prevention on the front end will certainly minimize or eliminate fines on the back end.

Janie M. Ratliff-Sweeney is a health care lawyer.  You can reach Ms. Ratliff-Sweeney at (859) 344-1188 or jratliff@hemmerlaw.com.

 

• posted: Oct. 05, 2017
• Todd McMurtry
• Uncategorized

Written By: Todd V. McMurtry

It is common in the ebb and flow of business for corporate directors to move in and out of corporations for a variety reasons. Therefore, it is critical for directors to understand the duties and obligations they have to the companies they serve. This article will focus on a director’s duty not to compete with a company for which he is a director.

Kentucky courts have long recognized that corporate directors owe a corporation they serve fiduciary duties that arise from the common law.  Baptist Physicians Lexington, Inc. v. New Lexington Clinic, P.S.C., 436 S.W.3d 189 (Ky. 2013). These fiduciary duties are generally limited to that of care and loyalty.  Stone v. Ritter, 911 A.2d 362, 370 (Del. 2006). The duty of loyalty essentially requires directors to always put the corporation’s interests above their own interests.  This duty is the one implicated when a director decides to compete. In Kentucky, part of that duty is that the director must not acquire an interest in a competing business. Id. 

Kentucky case law has many examples where a director of one company set up a competing business at the same time he was still a director of the company he was about to leave. In Aero Drapery of Kentucky, Inc. v. Engdahl, 507 S.W.2d 166 (Ky. 1974), Engdahl, an officer, director and shareholder of Aero Drapery, recruited key employees to start a competing business, shared confidential information with them, and loaned them money to purchase stock in the new competitor. All of this occurred in an eight-week period prior to Engdahl’s resignation. Needless to say, the Court determined that he violated his duty of loyalty to Aero Drapery. In its holding, the Kentucky Court of Appeals (then the state’s highest court) indicated that Engdahl could not have an antagonistic interest without full disclosure, and that he should have terminated his relationship when he first began his preparations to compete. Id.

Although this seems like a common-sense legal principle, in some circumstances, a person is a director of a number of companies that may compete in some manner. For example, business associates may own multiple companies that own commercial or residential real estate. Certainly circumstances arise where two people own Company A and one of those two is also an owner with a third person of Company B. It is possible that Company A and B might want to bid on the same property at a foreclosure auction. What should the director of both Company A and B do? This circumstance would put the director involved in both companies at risk to violate his duty of loyalty to one or both companies.

The best solution may be found in the Baptist Physicians Lexington case. There, a group of physicians resigned from New Lexington Clinic to join the nearby Baptist Physicians Lexington. The Kentucky Supreme Court analyzed the facts and looked favorably on physicians who left to compete because they had agreements that permitted them to leave and compete under certain circumstances.

This review of the law provides two good recommendations for those who serve as directors of a corporation. The first is to have a written agreement that protects both the company and the director should the director choose to leave to compete. Such an agreement can provide reasonable guidance to both parties. The second is, absent an agreement, to resign before starting a plan to compete; or at a minimum, fully disclose the plan to compete and obtain the consent of the corporation. These recommendations seem like common sense, but it is nevertheless smart to understand these duties and incorporate that understanding into the decision-making process.

Todd V. McMurtry is a Member at Hemmer DeFrank Wessels, PLLC.  He is a commercial trial attorney and Harvard trained mediator.  Todd has been married to his wife, Maria C. Garriga, for 32 years.  They have three adult children.