Coronavirus Insurance Coverage Update March 31—-New York Legislation, Chicago Restaurant and Theatre Lawsuit, and Insurance Industry Says Coverage Payments Would Dwarf Capacity to Pay
COVID-19 Coverage Litigation Escalates
As the COVID-19 pandemic brings about more shutdown orders, non-essential businesses that have been shut because of government orders are fighting to obtain insurance coverage. The first four cases brought were declaratory judgment actions seeing orders that their policies covered the suspension of their businesses. The latest case, however, goes a two steps further and includes breach of contract and statutory bad faith claims.…
New CMS Waivers for Stark Law, NCD, LCD and Supervision Requirements During Public Health Emergency
By: Jennifer Jones Thomas
Physicians enrolled in Medicare are all-to-familiar with the constraints of the Stark Law which prohibits physicians from making referrals for designated health services (“DHS”) payable by Medicare when the physician (or immediate family member) has a financial relationship with the entity performing the DHS. On March 30, 2020, CMS announced a number of Stark Law waivers to help put “patients over paperwork” and allow certain referrals and submission of claims that…
Navigating the Pandemonium Raised by the Pandemic: Risk Mitigation in M&A
An important negotiating point between buyers and sellers of a business is whether to include within the acquisition agreement a “Material Adverse Change” (MAC) or “Material Adverse Effect” (MAE) related closing condition. For simplicity’s sake, we will use the term MAC to refer to both MAC and MAE.
Use of MAC Clauses
MAC clauses permit the buyer to void the transaction if, prior to the closing date, a material adverse development occurs that affects (or…
Contract Disputes from COVID-19: Force Majeure Checklist
A party to a contract may under certain circumstances be excused from performing a contractual obligation when the failure to perform is caused by a “fortuitous event”—i.e., force majeure or an “act of God”—that makes performance impossible. Whether COVID-19 and related events, such as the pandemic declaration by the World Health Organization, government travel bans, or government declarations, constitute force majeure that impact contractual performance obligations depends on the language of the contract. Contracts often…
Barry Zalma on Insurance
https://www.youtube.com/watch?v=o62a4OnwixI
The First Party Claims Conference West was cancelled. I was upset not just because I missed an opportunity to teach about insurance and speak about my new book, Pay Up!, but to listen to insurance and legal educator Barry Zalma. Zalma has written many insurance books and I am proud to say that most are in our Merlin Law Group reference library.…
U.S. Dept. of Health and Human Services Makes it Illegal to Hoard Certain PPE, Ventilators and Sanitizing/Disinfecting Products
By Lauren Rucinski
On Monday, March 30, 2020 the U.S. Department of Health and Human Services (DHHS) issued a notice in the Federal Register declaring certain goods as “scarce,” which means it is illegal to hoard those items. The DHHS is acting under authority granted by President Trump under the Defense Production Act of 1950 (the “Act”).[1]
By declaring certain goods as scarce, the accumulation of those goods (1) in excess of the reasonable…
Eighth Circuit Rules on ERISA’s “Church Plan” Exemption
Background
On March 27, 2020, the Eighth Circuit in Sanzone v. Mercy Health, 2020 U.S. App. LEXIS 9537 (8th Cir. March 27, 2020), ruled on several key issues on the “church plan” exemption to ERISA. As background, beginning in 2013, plaintiff’s counsel filed ERISA class-action cases across the country challenging the application of ERISA’s “church plan” exemption to non-profit church-affiliated hospital organizations. In 2017, the Supreme Court ruled in Advocate Health Care Network v. Stapleton,…
Families First Coronavirus Response Act with Emphasis on Tax Credit Provisions
By Robert Schmidt
The Families First Coronavirus Response Act (“FFCRA”) was enacted as HR 6201 and signed into law on March 18th, 2020. The Act consists of three divisions which are relevant to the provision of family and medical and sick leave and providing for tax credits in connection with the mandatory family and medical and sick leave. Division C is entitled the Emergency Family and Medical Leave Expansion Act (“EFMLEA”). This division amends…
Coronavirus Stimulus Bill Offers Targeted Bank Regulatory Relief
Title IV of the Coronavirus Aid, Relief and Economic Security Act (CARES Act) passed by Congress on March 27, 2020 provides significant, although temporary, regulatory relief to banks, savings institutions and their customers.
The key bank regulatory relief provisions of the CARES Act are the following:
Grant of Authority to FDIC for Unlimited Guarantee of Transaction Accounts. Section 4008 of the CARES Act provides Congressional authorization for the FDIC to establish a temporary debt guarantee…