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Supreme Court Allows Retiree Benefits With Medicare
Headline Legal News | 2008/03/25 09:14

The Supreme Court on Monday let stand a federal policy that allows employers to reduce their health insurance expenses for retired workers once they turn 65 and qualify for Medicare.

The justices turned down an appeal by the 35-million-member AARP to undo a rule that essentially allows employers to treat retirees differently depending on their age.

The rules were put into place by the federal Equal Employment Opportunity Commission, with the support of labor unions and other groups. They worried that employers would greatly reduce or eliminate health benefits for millions of retirees if they could not take Medicare into account when structuring the health benefit packages they voluntarily provide their retired workers.

The EEOC rule makes clear that employers can spend more on retirees under 65 years of age than those over 65 without running afoul of age discrimination laws.

The EEOC said it proposed the rule in response to a decision in 2000 by the 3rd U.S. Circuit Court of Appeals in Philadelphia that held that the Age Discrimination in Employment Act requires employers to spend the same amount on health insurance benefits provided Medicare-eligible retirees as those received by younger retirees.

AARP said EEOC violated the intent of Congress when it proposed the rule. But the EEOC said the same age discrimination law allows it to carve out an exemption to preserve the long-standing practice that allows employers to coordinate benefits with Medicare.

The same appeals court upheld the EEOC policy last year



9th Circuit: County Can't Use RICO
Court News | 2008/03/25 09:14

An anti-illegal immigration lawsuit turned out to be much better as a metaphor than as a lawsuit.

When a former leader of Canyon County, Idaho, invoked civil RICO lawsto sue four corporations for hiring illegal immigrants, the move madeheadlines all the way up to The New York Times: The newspaper viewed it as a prism to understand how the immigration issue split the Republican Party.

But an ideologically balanced panel of the 9th U.S. Circuit Court of Appeals disposed of the complaint last week.Canyon County didn't have standing to argue that the companies' allegedhiring of illegal immigrants unfairly upped the cost of providingpublic services, Senior Judge A. Wallace Tashima ruled.

"We find it particularly inappropriate to label a governmental entity'injured in its property' when it spends money on the provision ofadditional public services," Tashima wrote, "given that those servicesare based on legislative mandates and are intended to further thepublic interest."

Senior Judge William Canby Jr. and Judge Consuelo Callahan joined Tashima.



Is Schwarzenegger Serious About Taxing Lawyers?
Legal Business | 2008/03/25 09:08

California Gov. Arnold Schwarzenegger has a $16 billion budget deficitdilemma on his hands. He insists he doesn't want to cut education. Buthe proclaims with equal fervor that he won't raise taxes.

So what's a post-partisan governor to do? Close tax loopholes, of course.

Now one governor's loophole may be another politician's tax increase.But according to two media outlets, Schwarzenegger told the audience ata Pleasant Hill, Calif., budget forum last Wednesday that the state should consider closing tax loop-holes and in his mind that includes the lack of a sales tax on professional services -- including legal services.

"We have to look at the way we are taxing," Schwarzenegger is reportedas saying. "There's whole new economies that are developing,service-oriented economies."

Asked about the comments on Thursday, finance department spokesman H.D.Palmer said the governor was just explaining that there are a lot ofdeficit-eliminating ideas "out there."

"Basically, it was in the context of we ought to have everything on thetable as we ought to be having discussions about them sooner ratherthan later," Palmer said. "But we're not carrying a bill in our backpocket, if that's what you're asking."



Attorney Is Disbarred for the Second Time
Legal Business | 2008/03/24 14:16

A one-time law firm associate, disbarred in 1988 for insider trading, then re-admitted in 2003, has been disbarred again for misrepresenting his past in applications both for reinstatement and for non-legal licenses to work as an insurance agent and a stock broker.

Israel G. Grossman committed his insider trading offenses while working as an associate at the firm now known as Kramer Levin Naftalis & Frankel. The confidential information he passed to friends and family about transactions the firm was working on netted them $1.5 million in trading profits.

Arrested and convicted in 1987, the then-34-year-old Grossman was sentenced to two years in prison. He was also later found jointly and severally liable to the Securities and Exchange Commission for $2.5 million. The case attracted considerable attention at the time, coming soon after prosecutors ensnared the much larger insider trading ring led by investment banker Dennis Levine.

But the Appellate Division, 1st Department, ruled last week that the now 55-year-old Grossman had consistently denied having a prior conviction on professional licensing applications to the state insurance department and the National Association of Securities Dealers. He failed to disclose these applications in his successful quest for reinstatement to the bar in 2003, even though he was facing criminal prosecution at the time for allegedly lying to the NASD about his past.



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