Legal Radar

Federal Court Makes Ruling Against Subsidies in Health Law

An Oklahoma federal judge early this week halted subsidies available to certain consumers who have bought insurance coverage via healthcare-exchanges. The ruling is another recent indicator that the issue will ultimately fall to the U.S. Supreme court for the last decision.

The ruling adds to a number of rulings as to whether or not consumers in the country depending on the federal marketplace are legally allowed to gain access to subsidies, a question a majority would expect to land in the Supreme Court. Two appeals back in July issued conflicting ruling regarding health law subsidies, which brought about questions on the stand of tax credits offered to Americans.

In 2012, Oklahoma challenged the IRS rule, saying that the ACA language lets subsidies to be offered only in states that created their own exchanges.

The federal government operates some or all internet-based exchanges in a number of states. This means, the number of individuals are required to buy health insurance or be penalized, could dramatically shrink if subsidies are invalidated.

Barclays Possibly to Face Further Litigation Worth $2 Billion

Barclays may be facing as high as $2 billion in added litigation as well as other costs this year as it tries to deal with regulatory and legacy matters, notes an analyst from Sanford C. Bernstein in a report early this week.

Barclays raked in over a billion pounds in provisions for wrongful sales of payment protection insurance and other issues during the second quarter.

Barclays could be booking £200 billion in provisions to settle a probe by the NY attorney general’s office regarding the firm’s private stock market. This includes £700 million on ongoing industry probe with regarding potential manipulation of the currency market.

It’s expected for Barclays to take in a £300 million charge in the second half of the year to reimburse consumers who were inappropriately sold products to hedge interest rates.

The firm was also sued by the NY attorney general’s office on its private stock market disclosures.

Furthermore, Barclays has set an extra £211 million aside for other suits and conduct charges.

Lyft Makes Agreement with NY Regulators in New Deal

Lyft Inc., a ride-sharing application, made an agreement to only utilize NY-based commercial drivers while complying with local and state law as it gears up for its operations in New York this Friday.

Based on the agreement filed in the NY Supreme Court on Friday, the San Francisco-based firm will also be suspending operations in Rochester and Buffalo by next month. At the same time, the company is asked to halt selling of insurance to NY drivers, unless the mentioned coverage is in compliance with the state law.

Attorneys Benjamin Lawsky, an insurance regulator, and Eric Schneiderman, an attorney general, filed a suit early this month which accused Lyft Inc. for illegal operations by using commercial drivers without insurance and license from the NY City’s taxi commission.

Lyft Inc., which began its Rochester and Buffalo operations on April and with plans on branching out to Queens and Brooklyn, said it’s never about being a “for-hire” car servicing firm. Instead, the firm simply aids car owners to offer rides to others in exchange for donation.

Democrats Still Seeking to Reverse Hobby Lobby Ruling

Democrats are getting ready to vote possibly next week on new legislation which would require that all for-profit companies provide insurance coverage for contraceptives. President Barack Obama's administration provided consultation in the development of the measure which is designed to reverse the U.S. Supreme Court Ruling that was reached just a week ago. Senator Patty Murray from Washington and Senator Mark Udall from Colorado drafted the legislation. Supporters are likely to run into trouble getting the bill approved in the House which is Republican-led, but think it will have no trouble passing in the Senate which is Democratic-controlled. Democrats are targeting women voters and hoping that they will step up in November's midterm elections. However, Republicans only need to gain six more seats in the Senate to have the majority and thus secure control of both the House and the Senate. If they succeed, they will have the majority as well as a solid control of both chambers of Congress during the final two years Obama is in office.

Senator Johnson Files Suit in Federal Court against Obama's HCA

Should elected officials be exempt from the laws they create? U.S. Senator Ron Johnson does not think so and presented his argument to the federal court on Monday. According to Johnson, the members of Congress along with their staffs should be required to get insurance on their own - just like other citizens who are subject to the Affordable Care Act. Johnson filed suit in federal court challenging the policy which the Obama administration designed to allow members of the Congress as well as their staffs to receive health coverage like they have for many years, or buy it using the federal insurance marketplace which is made available to small businesses throughout the D.C. area.An attorney with the Department of Justice, James Luh, wants the case thrown out and states that Johnson cannot legally bring the case since he is not directly being harmed by such regulations. U.S. District Judge William Griesback stated on Monday that he will issue a written decision soon.

Obama Administration Refer to Hobby Lobby Court Ruling on Wheaton Case

In the latest clash regarding the Affordable Care Act, the Obama administration recently referred to the SC’s Hobby Lobby ruling to support the claim of offering non-profit religious group a reasonable approach to opt out of contraceptive coverage on worker health plans.

Donald Verrilli, a U.S. Solicitor General, constructed the argument involving Wheaton College, an Illinois-based institution, looking to not comply with contraceptive alternative coverage while dealing with litigation regarding the challenge in lower courts.

Wheaton contends with the arrangement, which beneficially moves contraceptive costs to insurers, is deemed insufficient since it prompts school officials to file a form “triggering” urgent contraception coverage.

The Obama administration upholds the opt-out effectively resolves objections to birth control methods. The mechanism permits all affiliated religious employers to turn over contraception coverage accountability to an insurer.

On Monday, the SC ruled that closely held firms can invoke religious objections to curb contraception coverage in health plans.

The court ruling cited the non-profit opt-out process as an approach of commercial companies to be similarly served.

Supreme Court Rules in Hobby Lobby Case

Monday the Supreme Court ruled that businesses have the right to sue over the federal laws which attempt to make them take actions that are contrary to the business owner's religious beliefs. This is the first ruling by the Supreme Court that sets the precedent for other businesses. The ruling makes it clear that a for-profit company is its own entity, or a "person" when it comes to the law. That means that the business is offered the same rights and protections for their religious beliefs as a person would have. President Bill Clinton signed a bill in 1993 which protects the religious liberties of persons and today a company became a person protected by that law. The court did not make a decision on whether larger, publicly traded corporations will also have the same religious rights. Two companies were together in the legal case both Hobby Lobby and Conestoga Wood Specialties.

Farmers Insurance Drops Suit Against Chicago

Previously, Farmers Insurance filed a class action lawsuit against Chicago and the municipalities in the region. The Insurance group claimed that they were having to pay damages which were related to the failure of Chicago and the municipalities to prevent flooding which was a result of climate change. Chicago had  previously adopted a Climate Action Plan but allegedly failed to implement it. This inaction resulted in the suit by Farmers Insurance. However, the insurance company just dropped the suit against the municipalities and Chicago. Farmers did not give a reason in particular for withdrawing the suit, but a press release that was issued by the insurance company did state that they felt the suit had gained the attention of the relevant cities and counties and the insurance company felt that their policyholders would be protected by the changes anticipated in the way the local governments handle and implement the changes in the future.

GM Seeks Legal Representation in Recall Case

The U.S. National Highway TRaffic Safety Administration (NHTSA) announced just last month that GM would be required to pay the maximum fine of $35 million for failing to inform the public about vehicle defects in a timely fashion. Holland & Knight is set to advocate for the company and provide them with "oversight and legislation pertaining to the automobile recall." The company had to recall 2.6 million vehicles this year and there were 13 deaths which occurred related to the problem with the ignition switch. Heather Rosenker, the spokeswoman for GM stated that they hired Holland and Knight as consultants. The company is being accused of failing to warn the public of the defect in a timely fashion. Earlier, in March the House Energy and Commerce Committee opened an investigation into the manufacturer and at that time suggested fro congress to pass legislation that will make it easier for automakers and regulators to respond properly to safety problems such as these. 

Insurer Not Obligated to Warn of Policy Expiration

Philadelphia Judge Patricia A. McInerney ruled that an insurer did not have to warn insurance policy holders that their policy was about to expire if they did not respond in a timely manner to a renewal offer. The judge granted summary judgment in favor of the defendant finding that the insurance company was not bound to providing coverage to the plaintiff following a fire at their bar. The fire allegedly occurred just a few hours after the policy had expired. The owner of the business claimed that they were entitled to their coverage because their policy states the insured have to provide the insurers with a "written 60 day notice" to cancel coverage or for a non-renewal. However, since the business owner failed to reply to the renewal notice in a timely manner the insurance company was not bound. The bar's owners allegedly were "shopping" for insurance and failed to renew the policy after it expired.