SEC Launches Division To Engage With Public on Blockchain and Other FinTech Questions

By David Glod on October 22, 2018

The SEC recently launched a new division and web portal intended to help developers of financial technologies navigate the regulatory landscape.

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Delaware Permits LLCs to Divide into Separate LLCs

By Arvid von Taube on October 1, 2018

A new section of the Delaware Limited Liability Company Act provides a new mechanism to divide an existing LLC into multiple, new LLCs and to allocate assets and liabilities among the resulting entities.

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California Enacts Innovative Consumer Privacy Law

By Arvid von Taube on August 22, 2018

Fresh off the heels of the European Union's sweeping new privacy regulations, the State of California recently passed a first-in-the-nation privacy law that is sure to have implications for many businesses outside of California.

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Employment Law Alert: New Massachusetts Non-Competition Law Effective October 1, 2018

By J. Allen Holland on August 13, 2018

Governor Baker recently signed legislation limiting the enforcement of non-competition agreements against employees and independent contractors who reside in Massachusetts. Though Massachusetts courts have long imposed reasonableness limitations on non-competition agreements, this new legislation is the result of years of debate and numerous proposals.

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SEC's Office of Compliance Inspections and Examinations Announces Common Best Execution Issues

By Thomas H. Bilodeau, III, Scott A. Stokes and David Glod on July 19, 2018

The SEC Office of Compliance Inspections and Examinations recently issued a risk alert with respect to information concerning the most common deficiencies that the staff has cited in recent examinations of advisers' compliance with their best execution obligations under the Investment Advisers Act of 1940. The blog provides a summary of the most commonly cited issues in the OCIE report.

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Why you should care about complying with the GDPR even if you don't have customers in the European Union

By Arvid von Taube on June 27, 2018

Even if you don't have many customers or website visitors from the European Union, new General Data Protection Regulation could still impact you.

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Breaking News: Supreme Court Overrules Decades of Precedent Limiting Power of States to Collect Taxes from Online Retailers

By Theodore A. Lund on June 21, 2018

The Supreme Court recently overruled decades of precedent limiting the power of states to collect taxes from online retailers. As a result, businesses and consumers should expect major legislative changes.

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Estate Planning Toolbox - Frequently Asked Questions

on May 25, 2018

Whether you are unsure where to start with your estate plan or want to bring existing documents up to date, these frequently asked questions can help you plan your next step.

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Self-Evaluation: A Means to Avoid Liability under the Massachusetts Equal Pay Act

By Atakelti Desta and Frank N. Gaeta on May 18, 2018

Updates to the Massachusetts Equal Pay Act take effect on July 1st. Employers should be prepared to evaluate their employment practices to ensure they are in compliance with these new provisions.

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Estate Planning Toolbox - Documents Effective During Life: Healthcare Proxy, Living Will, and Durable Power of Attorney

on May 16, 2018

Estate planning isn't limited to planning for the end. Instruments such as living wills and healthcare proxies can also offer legal protection for you and your loved ones during life.

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Estate Planning Toolbox - Documents Effective at Death: Wills and Trusts

on May 10, 2018

Estate planning can seem like a daunting task, however it can provide important legal protection for both you and your family. This entry focuses on the importance of wills and trusts to the Estate Planning Toolbox.

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How to Tell if the Mail You Received is Actually from the United States Patent and Trademark Office

By Arvid von Taube on May 8, 2018

If you recently filed for or renewed a federally-registered trademark, it can be difficult to tell official USPTO notifications from third party imitators. Such imitators can be both convincing and misleading, but there are several red flags that can help you tell the real from the fake.

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Blockchain's Promised Revolution and the Legal Industry

By Nathaniel C. Donoghue on April 26, 2018

Despite being a new frontier and a still nascent technology, blockchain technology holds the promise to make the practice of law more efficient and more accessible. Practitioners who ignore this promised revolution do so at their own peril.

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Employment Law Alert: Massachusetts Pregnant Workers Fairness Act Becomes Effective

By J. Allen Holland and Nathaniel C. Donoghue on March 29, 2018

On April 1, 2018, the Massachusetts Pregnant Workers Fairness Act will officially take effect. The law requires most state employers to provide reasonable accommodations to pregnant employees and updates the sate anti-discrimination statute.

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Supreme Court Confirms State Courts Can Hear Certain Claims Based on Securities Offerings

By Arvid von Taube on March 27, 2018

The US Supreme Court recently confirmed that state courts can hear certain class action securities lawsuits, but uncertainty of outcomes in state and federal court will likely persist.

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Common Issues under Massachusetts Law with Multi-State Employees

on March 16, 2018

In today’s workforce, many employees work in a different state from their employer’s office. In Massachusetts, this arrangement requires careful planning by the employer in several legal areas.

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SEC’s Office of Compliance Inspections and Examinations Announces 2018 Examination Priorities

By Nathaniel C. Donoghue on March 9, 2018

In fiscal year 2017, the SEC examined approximately 15 percent of all federally registered investment advisers, up from 8 percent just five years ago. As the SEC ramps up the frequency and intensity of its examinations, registered entities must be aware of their obligations and the regulators’ key areas of focus.

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You can call it the Super Bowl, not “the Big Game”

By Arvid von Taube on March 6, 2018

Despite what you may have heard on the radio or seen on TV, you can call it the Super Bowl, not “the Big Game”.

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What is the Legal Status of Cryptocurrency in the U.S.?

By David Glod on February 16, 2018

With the recent explosion of public interest and media attention on cryptocurrencies such as Bitcoin and Ethereum, many have been left with questions such as: what is the legal status of cryptocurrencies, or cryptocurrency-based investment products? What are the legal implications of buying and trading them?

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SJC decision makes clear: corporate board members and shareholders are not presumed to be personally liable for Wage Act claims

By David Glod on January 2, 2018

In a decision issued December 28, 2017, the Supreme Judicial Court ruled that board members and shareholders of a company are not presumed to be personally liable for the company’s failure to pay wages.

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Unfair and Deceptive Practices – Insurance Companies Must Conduct Reasonable Investigations Before Denying a Claim

By Nathaniel C. Donoghue and Jeffrey B. Loeb on November 20, 2017

Massachusetts General Laws generally prohibit insurance companies from engaging in “unfair or deceptive acts or practices” and require them to conduct a “reasonable investigation based on all available information” before refusing to pay a claim. If an insurance company violates these laws, it can be subject to multiple damages and the opposing party’s fees and costs. A recent case in the US District Court for the District of Massachusetts dealt with this issue.

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ITC Recommendation Condemned By Solar Industry

By Jennifer Lang and Eric J. Krathwohl on November 7, 2017

The U.S. International Trade Commission recently made recommendations regarding the importation of CSPV cells, used in solar panels, that would potentially double the price of solar panels available to US consumers. This blog provides a breakdown of the key legal issues from the ITC recommendations in advance of the public comment period.

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Net Metering for Storage in Massachusetts?

By Jennifer Lang and Eric J. Krathwohl on October 23, 2017

On October 3, 2017, the Massachusetts Department of Public Utilities took the significant step of opening an inquiry into the eligibility of energy storage systems for net metering. Massachusetts follows New York as a national leader on this issue, which could continue the expansion of renewable energy generation.

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SEC Receives Final Recommendations from Small and Emerging Companies Advisory Committee

By Nathaniel C. Donoghue on September 27, 2017

The SEC's Advisory Committee on Small and Emerging Companies recently issued its final report, providing recommendations on rules, regulations, and policies relating to capital raising, securities trading, public reporting, and corporate governance of small private businesses and publicly traded companies with less than $250 million in public market capitalization.

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SEC Provides First Guidance on Cryptocurrency, Blockchain and Initial Coin Offerings

By Matthew Sweet, Thomas Bilodeau, III, David Glod on August 9, 2017

On July 25, the U.S. Securities and Exchanged Commission released a Report that represents the first major injection of regulatory guidance into the burgeoning cryptocurrency markets. This blog will provide a breakdown of the key takeaways from the SEC’s Report and what it means for the cryptocurrency market going forward.

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Proper Attribution and Retaining Rights in Creative Commons Licenses: Potential copyright pitfalls when creating or using material under a Creative Commons license

By Nathaniel C. Donoghue on July 24, 2017

Since 2002, Creative Commons has published and maintained a selection of free-to-use copyright licenses. The concept is part of the broader open-source movement which has pushed back against traditional copyright laws. Though popular and successful, these licenses provide both creators and consumers deceptively broad latitude, unintentionally creating potential copyright pitfalls.

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SJC Ruling Opens the Door for Medical Marijuana Employment Discrimination Claims

By J. Allen Holland, James T. Finnigan, Frank N. Gaeta and Nathaniel C. Donoghue on July 18, 2017

On July 17, 2017, the Massachusetts Supreme Judicial Court held in the case Barbuto v. Advantage Sales and Marketing, LLC that a qualifying patient who has been terminated from her employment because she tested positive for marijuana as a result of her use of medically prescribed marijuana may pursue a claim of handicap discrimination in violation of the Massachusetts anti-discrimination statute.

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Additional Guidance on Fiduciary Rule as it Applies to Investment Advisers

By Thomas H. Bilodeau, III, David Glod and Scott A. Stokes on June 7, 2017

In light of some uncertainty surrounding the application of the Department of Labor (“DOL”) Fiduciary Rule to investment advisers who advise private funds and managed accounts, we are providing this supplement to our recent Client Alert on June 2, 2017 titled Update on Applicability of the DOL’s Fiduciary Rule.

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DOL Delays Enforcement of Fiduciary Rule

By David Glod on June 5, 2017

The Department of Labor fiduciary rule (the “Fiduciary Rule”) will come into effect June 9, 2017. The Fiduciary Rule will apply fiduciary standards and impose certain requirements upon advisers to ERISA plans and individual retirement accounts, defined contribution plans and defined benefit plans.

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Clarification of the Custody Rule and Standing Letters of Instruction

By Thomas H. Bilodeau, III, David Glod and Scott A. Stokes on March 10, 2017

Many investment adviser clients seek to facilitate payments and disbursements to third parties through a standing letter of instruction or other asset transfer authorization established with a qualified custodian (an “SLOI”). Often, the SLOI will allow the qualified custodian to accept the investment adviser’s instructions to move money to third parties on the client’s behalf. This authority is limited to the terms of the SLOI and may generally be revoked by the client at any time.

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FINRA Proposes Revamp of Securities Exam Regime

By Thomas H. Bilodeau, III on March 9, 2017

The Financial Industry Regulatory Authority (the “FINRA”) announced yesterday that it has filed a proposal with the Securities and Exchange Commission (the “SEC”) to streamline competency exams and facilitate opportunities for professionals seeking to enter or re-enter the securities industry.

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Highlights of the SEC Forum on Small Business Capital Formation

By Thomas H. Bilodeau, III on January 26, 2017

The 35th Annual Securities and Exchange Commission Government-Business Forum on Small Business Capital Formation was held on November 17, 2016 at SEC Headquarters in Washington, D.C. A panel of learned practitioners and securities law experts held a discussion on the state of the union of small business capital formation moderated by the Director of the SEC Division of Corporation Finance and the Chief of the Office of Office of Small Business Policy SEC Division of Corporation Finance. The then current SEC Commissioners also were in attendance.

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The Importance of Retaining Specialized Local Counsel for Real Estate Transactions

By Danielle Justo and Sarah M. Wegman on January 3, 2017

It is incredibly common for out-of-state attorneys (and even local attorneys with limited real estate experience) to conclude transactions which create or exacerbate serious title defects, which the attorney and her clients mistakenly believe, often for many years, have been properly performed. There are several reasons for this, but the most common is the quagmire of the dual-recording system in Massachusetts.

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New Minimum Wage Requirement to Take Effect on January 1, 2017

By J. Allen Holland and Atakelti Desta on December 19, 2016

The Massachusetts minimum-wage rises from $10 per hour to $11 per hour on January 1. Even those employers who do not normally hire lower wage or hourly employees should be aware of this change.

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Employers: Revise Your Confidentiality Agreements and Releases

By Frank N. Gaeta on December 1, 2016

In light of the federal Defend Trade Secrets Act of 2016 (“DTSA”), along with recent decisions and other guidance from various federal agencies, companies should carve out exceptions from their confidentiality agreements and any agreements containing a release of claims (such as employment separation agreements). The exceptions are generally intended to allow employees to engage in protected “whistleblower” activity.

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DPU Sets Interim Guidelines for Investigations Regarding Competitive Energy Suppliers

By Atakelti Desta and Eric J. Krathwohl on November 29, 2016

Massachusetts has allowed customers to choose among retail suppliers of electricity for about two decades. Until recently, however, retail choice was a reality only for larger commercial and industrial customers. In the past couple years, residential customers have begun to enjoy the fruits of retail choice. Such fruit however sometimes includes a bad apple. Massachusetts, along with neighboring states has initiated proceedings to review complaints against competitive energy suppliers and has imposed fines in certain cases. Recently, the Massachusetts Department of Public Utilities (the “DPU”) proposed Interim Guidelines that establish clear enforcement procedures to be applied in such reviews, with the intent that they eventually be codified in final regulations applicable to competitive suppliers of both electricity and natural gas.

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Alert - Overtime Rules Halted By Federal Court

By J. Allen Holland, Frank N. Gaeta and Atakelti Desta on November 28, 2016

Alterations to overtime exemption regulations have been placed on hold.

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Employer Alert - USCIS Issues a Revised Form 1-9

By James T. Finnigan on November 17, 2016

Federal law requires that every employer who hires an individual for employment in the U.S. must complete a Form I-9 entitled Employment Eligibility Verification.

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Capital Acquisition Broker Regulation- A Solution to the Finder Issue?

By Scott A. Stokes, Thomas H. Bilodeau, III and James B. Heffernan on November 16, 2016

On August 18, 2016, the Securities and Exchange Commission (“SEC”) adopted FINRA’s proposal establishing this new category of intermediaries who may receive payment based on a percentage of the transaction proceeds in connection with assisting a company in a private placement or with the evaluation of securities. The new CAB registration process should help clarify the long standing uncertainty about the legality of so called “finder” activities performed without registration as a broker-dealer.

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Alert - New Overtime Rules for White Collar Employees to Take Effect on December 1, 2016.

By Nathaniel C. Donoghue, J. Allen Holland and Frank N. Gaeta on November 15, 2016

In June of this year, the United States Department of Labor made significant alterations to overtime exemption regulations. These changes will take effect on December 1, 2016.

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Preparing Your Company for the New Pay Equity Act in Massachusetts

By Atakelti Desta on September 29, 2016

For the past several decades, legislation has been in place to address the long-standing existence of gender pay discrimination. Under federal and Massachusetts law, employers are generally required to provide men and women equal compensation for comparable work. But until recently, in Massachusetts, “comparable work” was determined merely by job titles and job descriptions. On August 1, 2016, in a further effort to reduce the gender wage gap, Governor Charlie Baker signed into law an act that not only expands the definition of “comparable work” but also curbs common pay secrecy and pay inquiry practices by employers.

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EU-US Privacy Shield

By Nathaniel C. Donoghue and Scott A. Stokes on September 16, 2016

Starting on August 1, 2016, the EU-U.S. Privacy Shield program (“Privacy Shield”), became the new framework for transatlantic exchanges of personal data for commercial purposes between the European Union and the United States. This new code of conduct is not a treaty or a law, but a voluntary self-certification and commitment to certain protections necessary for the transfer of EU personal data to the U.S. Once made, the commitment is enforceable under U.S. law. Privacy Shield replaces the now invalidated “Safe Harbor” program which many organizations had previously relied upon to transfer personal data of EU citizens into the U.S.

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REDUCTIONS IN NET METERING CREDITS NOW JUST AROUND THE BEND

By Eric J. Krathwohl and Jonathan Goldberg on August 2, 2016

After many months of speculation about the evolving legislative and regulatory support of the solar industry in Massachusetts, new laws and implementing regulations have been adopted. These changes will have a significant impact future solar development projects. In April 2016, Governor Baker signed An Act Relative to Solar Energy into law. Under the new law, the value of solar net-metering credits will decrease significantly and a new monthly minimum reliability charge for net-metering customers is authorized. (That Act also increased the net metering caps, but the existing queues largely absorbed the increases, so further legislation is needed, but that is a topic for another blog).

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Women-Owned Businesses - Some Resources

By Danielle Justo and Nathaniel C. Donoghue on June 13, 2016

Although women-owned businesses are growing in number and importance, they continue to face a variety of challenges. In the Commonwealth and beyond, there are many resources available to women looking to grow their networks and companies. In addition to legal advice, our clients often ask us about these opportunities. Here are just a few of the organizations which we believe might be helpful for all kinds of women-owned businesses.

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New Overtime Rules for White Collar Employees

By J. Allen Holland and Frank N. Gaeta on June 6, 2016

The United States Department of Labor recently announced significant changes to the overtime exemption regulations under the Fair Labor Standards Act, effective December 1, 2016.

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Federal Rules Amendments Suggest Review of Electronic Backup and Data Retention Policies

By David Glod on June 1, 2016

If you’re a business owner, you probably already have certain policies and procedures related to how you store and backup your business records. Naturally, these policies and procedures must be disseminated to your employees and consistently followed. If that is done, such policies can help protect the company in the event it finds itself involved in litigation, and it turns out that relevant business records have previously been destroyed in accordance with company policy.

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2016 Update on Liquor Licensing in the Commonwealth

By Nathaniel C. Donoghue and Danielle Justo on May 18, 2016

Beginning in August, 2016, seven towns in Massachusetts will serve as pilots for a new e-Licensing procedure for obtaining alcoholic beverages licenses from the Alcohol Beverages Control Commissions (ABCC). The ABCC has been working to modernize their licensing process, and the new online ePlace Portal will replace the current antiquated paper applications. The new procedure is intended to expedite the retail license approval process and, ultimately, benefit the business community. The towns taking part in this pilot program are Boston, Cambridge, Chelmsford, Dedham, Lawrence, Salem, and New Bedford. Applicants will still need to appear before the local licensing authority, but once they have local approval, the subsequent ABCC approval process, which currently takes between 6-8 weeks, should be significantly shortened.

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A Parent Company Can be held Liable for its Subsidiary’s WARN Violations

By Mark C. O'Connor on January 14, 2016

The Worker Adjustment Retraining and Notification Act ("WARN") requires employers with 100 or more employees to provide 60 calendar days' notice of plant closings or mass layoffs to give transition time to workers and their families to adjust to the prospective loss of employment, seek alternative jobs and/or enter skill training or retraining to successfully compete in the job market. 29 U.S.C. §2101 et seq. Employers who fail to comply with WARN can be liable to affected employees for up to 60 days of pay and benefits as well as penalties. 29 U.S.C. §2104(a)(1).

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Would winning Powerball be too much of a hassle? Consider a trust.

By Stephen M. Kane on January 13, 2016

A few years ago we were contacted by the winner of a $10,000,000 Massachusetts Lottery scratch ticket. He was adamant that he did not want the winnings to change his life or to have his friends and family (other than his wife) know about his good luck or have charities and others dun him for gifts or loans. He knew that the Massachusetts Lottery requires publication of the name and a photograph of all winners. Rich May was able to help him collect his winning anonymously.

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A Parent Company Can be held Liable for its Subsidiary’s WARN Violations

By Mark C. O'Connor on January 11, 2016

The Worker Adjustment Retraining and Notification Act ("WARN") requires employers with 100 or more employees to provide 60 calendar days' notice of plant closings or mass layoffs to give transition time to workers and their families to adjust to the prospective loss of employment, seek alternative jobs and/or enter skill training or retraining to successfully compete in the job market. 29 U.S.C. §2101 et seq. Employers who fail to comply with WARN can be liable to affected employees for up to 60 days of pay and benefits as well as penalties. 29 U.S.C. §2104(a)(1).

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Employers May be Liable to Reimburse Employees for Their Use of Their Personal Cell Phones or Other Electronic Devices

By Mark C. O'Connor on August 27, 2015

Employees use cell phones, laptops, smart phones and other mobile devices for both business and pleasure. Are employers liable to reimburse the employee for their business use of their personal cell phone, laptop or other devices? A California Court of Appeals has held that employers must reimburse a reasonable portion of the employee’s cell phone bill if the employee must use their personal cell phone for work-related calls even if the employee has an unlimited data plan for which they do not actually incur any additional expense.

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Employee or Independent Contractor?

By Frank N. Gaeta on July 22, 2015

Addressing an issue that continues to bedevil many employers, the Administrator for the U.S. Department of Labor’s Wage and Hour Division recently issued further guidance on whether a worker is an “employee” or an “independent contractor” under the Fair Labor Standards Act (FLSA). On July 15, 2015, the Administrator issued an “Interpretation” of the FLSA’s standard for determining how to categorize a worker. Ultimately, the Administrator stated, a worker who is “in business for him or herself” is an independent contractor, while a worker who is “economically dependent” on the employer is an employee.

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POSTED IN: Real Estate

Uncertainty Remains Regarding Realtor Affiliations in Spite of SJC Decision

By Atakelti Desta on July 22, 2015

All states require that both real estate salespersons and real estate brokers be licensed by the state. While both perform many of the same duties, brokers are generally expected to complete more real estate education and have a more comprehensive familiarity with the laws affecting the sale of property. Massachusetts law requires that a salesperson be “engaged by a licensed broker” and “not conduct his own real estate business.” In spite of this requirement, brokers usually hire salespersons as independent contractors rather than traditional employees for general tax purposes.

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Employer Can Be Held Liable for Employee Intentionally Failing to Report Overtime under FLSA

By Mark C. O'Connor on June 17, 2015

An employee's intentional violation of the company timekeeping policies may not be a defense to a Fair Labor Standards Act claim if the employer knows or has reason to know that an employee underreported his hours according to a recent decision by the Eleventh Circuit Court of Appeals in Bailey v. TitleMax of Georgia, Inc.

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Massachusetts AG Announces Six-Month Safe Harbor For New Sick Leave Law

By Frank N. Gaeta on May 28, 2015

Attorney General Maura Healey has announced a six-month deferral of the requirement to comply with the new Massachusetts sick leave law for employers with certain paid time off policies in effect as of May 1, 2015.

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Failure to Timely Object to EEOC Subpoena Waives Objections

By Mark C. O'Connor on May 28, 2015

Employers who receive an EEOC Subpoena which they believe is overly burdensome, unduly broad or irrelevant or seeks privileged information must file a petition with the EEOC within five business days of receiving the Subpoena. The Seventh Circuit Court of Appeals has ruled that, in order to object to an EEOC Subpoena based on irrelevance, over breadth or privilege, an employer must file a petition with the EEOC within such time period otherwise the objections are waived. It is not sufficient to object to the Subpoena when the EEOC files suit against the employer to enforce the Subpoena.

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New Earned Sick Time Law’s Proposed Regulations

By J. Allen Holland on May 21, 2015

The Massachusetts Attorney General’s Office has now issued Proposed Regulations for the implementation of the Commonwealth’s Earned Sick Time Law, slated to take effect on July 1, 2015. The Proposed Regulations provide employers with guidance and additional details on implementation of and compliance with the Earned Sick Time Law.

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Complying with the Commonwealth’s Minimum Wage Regulations

By J. Allen Holland on May 8, 2015

As most know, the minimum wage for hourly and tipped employees has increased for 2015. Less publicized, however, are the new Minimum Wage Regulations employers must follow.

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POSTED IN: Real Estate

Increased Chinese Investment in US Commercial Real Estate

By James B. Heffernan on February 4, 2015

According to a recent NAIOP Massachusetts forum, Chinese foreign investment in U.S. commercial real estate has increased from $3 billion in 2013 to $6.6 billion in 2014. As a result, China is now only second to Canada in cross-boarder real estate investments.

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New Massachusetts Crowdfunding Exemption

on January 29, 2015

On January 15, 2015, the Massachusetts Securities Division adopted the Massachusetts Crowdfunding Exemption, 950 CMR 14.402(B)(13)(o) (the “Exemption”), allowing a company formed and having its principal place of business in Massachusetts to conduct intra-state (i.e., all investors are Massachusetts residents) crowdfunding offerings.

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Massachusetts Extends Parental Leave Rights to Men

By James T. Finnigan, Frank N. Gaeta and J. Allen Holland on January 29, 2015

On his last day in office, Governor Deval Patrick signed the Massachusetts Parental Leave Act (PLA) which replaces the Massachusetts Maternity Leave Act (MLA). Effective April 7, 2015, both men and women will enjoy the same rights to job-protected parental leave.

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Unpaid Internships in Massachusetts – Traps for the Unwary

on January 13, 2015

Today, companies of all sizes are contemplating and implementing internship programs. An increasingly common question is whether companies can establish unpaid internship programs. Generally, most for-profit companies in Massachusetts must pay interns at least the current minimum wage of $9.00 per hour.

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New Massachusetts Sick Time Law

By Frank N. Gaeta and J. Allen Holland on November 20, 2014

Earlier this month, voters approved a new law requiring all Massachusetts employers to provide their Massachusetts employees with up to 40 hours of sick leave per year. The new law takes effect on July 1, 2015.

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Demystifying 83(b) Elections

on October 23, 2014

If your employer grants you stock in connection with your services, under Section 83 of the Internal Revenue Code (the “IRC”), you will be taxed on the difference between the fair market value (“FMV”) of the stock and the amount you paid for the stock. In most early-stage company situations, an employer will grant stock to an employee that the employee loses if he or she leaves the company before a certain date (usually by repurchase by the Company and commonly referred to as “forfeiture”).

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Pre-Money and Post-Money Valuations: What’s the Difference?

on October 1, 2014

After working with a number of early stage companies trying to raise capital, it has become evident that the concepts of pre-money valuation and post-money valuation are often a source of confusion.

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'LightLab' Case: Problematic for Startups Seeking to Enforce Trade Secret Protections

By David Glod on September 18, 2014

A recent decision of the Massachusetts Supreme Judicial Court counsels that early-stage companies need to be especially protective of their trade secrets.

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Convertible Promissory Notes - The Basics You Should Know

on August 12, 2014

If you’re a player in the early-stage company space, you’ve likely heard of convertible promissory notes (CPNs).

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Finally Some Limited Relief for "Finder" Business Brokers

on June 13, 2014

A longstanding grey area of the law has been the broker-dealer registration requirements for finders – those persons or businesses effecting or facilitating transactions to raise capital through the sale of securities.

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Data Security Breach: State Notification Requirements

By Frank N. Gaeta on June 6, 2014

Data security breaches are becoming more and more common, impacting businesses of all sizes. To respond to this unfortunate reality, almost every state has adopted notification procedures in the event of a security breach to ensure immediate actions are taken to mitigate possible harm.

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POSTED IN: Real Estate

The Massachusetts Nominee Trust- Some Thoughts

By Erica P. Bigelow on February 18, 2014

Almost every commercial property owner in the Commonwealth has encountered, if not personally used, a Massachusetts nominee trust - sometimes called a 'realty' trust. Often, new clients will tell me that an attorney (unidentified) told them to put their property in trust, or that they always put their properties into a trust.

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Investment Advisor Diligence Processes for Alternative Investments

By David Glod, Scott A. Stokes and Thomas H. Bilodeau, III on February 13, 2014

The Securities and Exchange Commission’s Office of Compliance Inspections and Examinations (OCIE) recently issued a Risk Alert relating to investment advisers’ due diligence processes in recommending or placing clients’ assets in alternative investments including hedge funds, private equity, venture capital, real estate, and funds of private funds.

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First Circuit Decision Increases ERISA Exposure for Private Equity Funds

By David Glod on January 28, 2014

The First Circuit issued a controversial decision last summer, holding for the first time that a private equity fund can be held jointly and severally liable for the unfunded pension obligations of its portfolio companies.

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POSTED IN: Real Estate

New Decision Impacts Landlord Remedies in Commercial Leases

By Howard L. Levin on December 6, 2013

This year’s decision by the Massachusetts Supreme Judicial Court in 275 Washington Street Corp. v. Hudson River International, LLC, 465 Mass. 16 (2013) held that there was no reason to expand the common law remedy applicable to a general indemnity clause.

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A Non-Solicitation Clause May Be Broader Than You Thought

By James T. Finnigan on November 18, 2013

Cases involving non-compete/non-solicit provisions in an employment contract are often settled after the preliminary injunction stage. Therefore, appellate court opinions involving such agreements are uncommon. However, the First Circuit recently issued an opinion in a case involving a non-solicitation covenant that offers some good news for employers.

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Newly Amended Mass. Rules of Civil Procedure Focus on Electronic Discovery

By David Glod on November 13, 2013

The Supreme Judicial Court recently adopted amendments to the Massachusetts Rules of Civil Procedure to establish discovery practices governing electronically stored information (“ESI”). The Reporter’s Notes to the amendments cite estimates that 93 percent or more of corporate information is now being stored in some digital or electronic format.

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POSTED IN: Real Estate

What Real Estate Developers need to know about the EB-5 Immigrant Investor Program

By James B. Heffernan on October 14, 2013

Due to the credit crunch of the past few years and high interest rates on mezzanine financing, a new financing tool has emerged: the EB-5 Immigrant Investor Program. Enacted as part of the Immigration Act of 1990, the program is a great potential source of low interest financing for real estate developers. Of course, nothing comes easy and developers should be mindful that this source of funds does come with a few strings attached.

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POSTED IN: Real Estate

Is Your Property Insurance Really Doing the Job?

By Erica P. Bigelow on October 9, 2013

If you own property – commercial, single or multi-family residential, or condominium – you probably assume, if you have 100% replacement cost coverage, that the insurance policy will pay out sufficient funds to allow you to rebuild in the event of a casualty. Not necessarily.

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What Employers should know about Changes in Healthcare Law

By James T. Finnigan on October 2, 2013

Under the Patient Protection and Affordable Care Act (often called "Obamacare"), individuals will have access to health insurance coverage through the "Health Insurance Marketplace" ("Marketplace") as of January 1, 2014. The Marketplace consists of health insurance exchanges established by the states or the federal government to allow people seeking health insurance to compare, shop for, and purchase private insurance. Marketplace open enrollment began on October 1, 2013. In Massachusetts, the Marketplace is called the Massachusetts Health Connector.

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New Rules Regarding General Solicitation and General Advertisement Under Rule 506 of Regulation D.

on September 23, 2013

If you’ve ever purchased or sold the securities of a private company, you’re probably familiar with Rule 506 of Regulation D. The current Rule 506 (the "Old Rule") provides a private offering exemption "safe harbor" under the Securities Act, which allows an issuer to sell securities without registering them with the Securities and Exchange Commission (the "SEC").

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Big Growth and Changes in Massachusetts Solar Market

By Eric J. Krathwohl on June 5, 2013

Over the past couple of years, following Massachusetts' announcement of its Solar Carve- Out program, there has been a tremendous flurry of development of large and small solar generation facilities.

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POSTED IN: Real Estate

Massachusetts Liquor License Applications Faster Under New Regulation

By James B. Heffernan on May 29, 2013

The Massachusetts Alcoholic Beverages Control Commission (ABCC) has just adopted a procedural change for approval of liquor license applications to speed the process for applicants.

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Why start-ups shouldn't skimp on IP documentation

By Rich May, P.C. on April 25, 2013

You run a technology company. Imagine for a moment that I am a prospective investor or buyer of your company. As I perform my due diligence, among a lot of other questions, I want to find out if I can trust your intellectual property chain of ownership. By that I mean, can I trace a contractual link between your company and all the sources of the technology that you use and distribute, and can I verify that you haven't given away ownership or destructively broad rights to someone else?

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Two places a start-up shouldn't skimp documentation

By Rich May, P.C. on April 18, 2013

Here’s a story you might have heard before. Fantastic Start-up, Inc. built a nice little business, from two founders and no revenue to 37 employees, 20 paying customers and revenue of $3.8 million last year. It took four long, hard years to get here, but now a VC firm wants to invest, and Fantastic Start-up could do some good things with that money. Due diligence started last week. And it doesn’t seem to be going all that well.

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Restricted Stock Basics

By Rich May, P.C. on March 25, 2013

Restricted stock is a common way that companies put equity in the hands of their employees. Like stock options, the employee receives a grant (also called an award) from the company, in most cases he doesn’t pay anything for the grant, and usually it vests over time. But there are important differences between stock options and restricted stock. What is restricted stock? Restricted stock is shares of a corporation, issued by the company to a service provider (an employee, director, consultant, advisor or other person), with restrictions on transfer and a risk of forfeiture until specified vesting conditions are met.

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New Studies Show Wind Turbine Syndrome is Psychological

By Eric J. Krathwohl on March 22, 2013

Everyone knows what a NIMBY is and everyone in the renewable space knows what BANANA means (Build Absolutely Nothing Anywhere Near Anything), but here's a new one: "Nocebo." It's the opposite of placebo. Just as science has established the existence of a placebo effect -- thinking yourself out of an illness on the belief you're taking effective medicine, when you're taking a pill with no more curative properties than a piece of cereal -- so science has shown the opposite.

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How are stock options taxed?

By Rich May, P.C. on March 15, 2013

As explained in an earlier blog entry ("ISOs and NQSOs - What's the difference?"), the U.S. federal tax code recognizes two types of stock options: "incentive stock options" ("ISOs") and "non-qualified" stock options ("NQSOs"). How are they taxed? The best way to understand the difference is to start with a basic tax model, which applies to NQSOs.

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ISOs and NQSOs - What's the difference?

By Rich May, P.C. on March 7, 2013

In the United States, the federal tax code recognizes two types of stock options. Section 422 of the Internal Revenue Code lays out the requirements for a stock option to qualify as an "incentive stock option," widely called an "ISO," which carries a tax benefit. All other options are designated as "non-qualified" stock options, widely called "NQSOs."

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The Value of a Shareholders' Agreement

By Rich May, P.C. on February 28, 2013

Everybody likes to save money, right? And nobody enjoys paying a lawyer hundreds of dollars an hour for something that you can probably find on-line. It’s not hard to use the Internet to form a corporation or a limited liability company in any state, often for less than the cost of hiring a lawyer to do it. But you always get what you pay for.

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Choosing a Business Name? Do Your Diligence First.

on February 27, 2013

If you’re thinking about starting a new business, one of the first decisions you’ll make is coming up with a name. In deciding on a name, it is important to understand the concepts of legal names, trade names (sometimes referred to as a d/b/a or fictitious name), and trademarks.

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Letter of Intent: Avoid Common Pitfalls

on January 11, 2013

If you have been involved in a business transaction, then you have likely signed a letter of intent (sometimes referred to as a “memorandum of understanding” or “term sheet”). The purpose of a letter of intent is to outline the key terms of a deal before more detailed agreements are finalized.

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Fiscal Cliff Resolved - Production Tax Credit Extended

By Eric J. Krathwohl on January 4, 2013

The word of the day is wind! Notably, the new year brings with it another 24 month PTC for wind projects, as many in the industry predicted, but no one was banking on. The temporary resolution of the fiscal cliff by New Year's Eve legislation included extensions on a number of tax credits. Most notably for wind advocates, the Production Tax Credit has been extended for any projects commenced through 2013 and completed by the end of 2014.

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JOBS Act

By Rich May, P.C. on December 31, 2012

Last spring my law firm issued an alert about the “Jumpstart Our Business Startups Act,” called the JOBS Act. This is a good place for a quick update and summary of that new law.

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C Corp or S Corp?

By Rich May, P.C. on December 29, 2012

Okay, let’s assume you’ve ruled out forming your business as an LLC. You’ll use a corporation. So do you elect “small business corporation,” otherwise known as “S corporation” status the Internal Revenue Code (beginning with IRC section 1361), or fall back on the default “C corporation” status (meaning any corporation that isn’t an S corporation)?

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Entity Choice

By Rich May, P.C. on December 28, 2012

You’ve got a choice: LLC or corporation? (Yes, I know there are actually a few others, such as limited partnerships and business trusts, but those are used in limited circumstances for very sophisticated investors; for now I’d rather focus on horses, not zebras.)

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