TC Energy Corporation stated that it filed a notice of intent with the U.S. Department of State that it will make a claim against the U.S. under the North American Free Trade Agreement (NAFTA). The claim will be based on President Biden’s January 2021 revocation of TC Energy’s Keystone XL Pipeline permit.
Continue Reading TC Energy’s $15B Claim Against U.S. for Biden’s Revocation of Keystone XL Pipeline Permit
The long-awaited proposed changes to the Department of Interior’s Financial Assurance Rule (“Proposed Rule”) were finally announced yesterday by the Trump Administration. The announcement provides, among other things, that the proposed rulemaking is in efforts to clarify, streamline and provide greater transparency to the financial assurance requirements (e.g., supplemental bonding) for OCS lessees and grant holders of pipeline rights-of-way (“ROW”) and rights-of-use and easement (“RUE”), while protecting U.S. taxpayers against picking up the tab for high-risk decommissioning liabilities. Once this Proposed Rule is published in the Federal Register (date yet to be announced), the public will have a 60-day comment period.
Continue Reading DOI Announcement of a Proposed Rule on Risk Management, Financial Assurance and Loss Prevention
Commercial Lease Considerations in the Wake of Hurricane Laura
Following disasters such as Hurricane Laura, business owners have a variety of concerns when beginning the recovery process. Chief among those concerns: what to do when your place of business has been damaged or destroyed? If you lease your place of business, or if you lease out land or buildings to other people for their businesses, this concern becomes especially important when you consider the different parties with a potential interest in the recovery—the lessor (landlord), the lessor’s insurer, the lessor’s lender, the lessee (tenant), the lessee’s insurer, and the lessee’s lender. Being familiar with your lease agreement is the key to understanding the extent of your rights and responsibilities, especially as they pertain to repair obligations, obligations regarding the payment or reimbursement of insurance deductibles, insurance recovery, and rights to termination and reduction (abatement) of rent. As an initial matter, the first question you should ask yourself is: What kind of lease agreement do I have?
Continue Reading Commercial Lease Considerations in the Wake of Hurricane Laura
On May 19, 2020, the Occupational Safety and Health Administration (“OSHA”) issued two noteworthy enforcement memos. The first memo announced the reversal of OSHA’s April 10, 2020 policy that limited the requirement to track on-the-job cases of COVID-19 to health-care facilities, emergency response providers, and corrections facilities. The new policy, which goes into effect on May 26, 2020, mandates that all employers who are required to maintain OSHA injury and illness logs determine whether employees’ cases of the COVID-19 virus are “work-related” and record those that meet certain requirements. Specifically, employers subject to OSHA’s recordkeeping requirements must record a case of COVID-19 as job-related if (1) it is a confirmed case of the virus as defined by the CDC, (2) it is “work-related” in that an event or exposure in the work environment either contributed to or caused an employee to contract the virus, and (3) it results in death, days away from work, restricted work or transfer, medical treatment beyond first aid, or loss of consciousness or involves a significant diagnosed injury or illness. Employers who have no recordkeeping obligations need only report work-related COVID-19 illnesses resulting in an employee’s death or in-patient hospitalization, amputation, or loss of an eye.
Continue Reading OSHA Addresses Reporting COVID-19 Cases as Job-Related and In-Person Workplace Inspections
Today, countries worldwide are responding to a pandemic of respiratory disease spreading from person-to-person caused by a novel coronavirus. The disease has been named “coronavirus disease 2019” (abbreviated “COVID-19”). The pandemic poses a serious public health risk, and government response has included closure of schools and businesses, declarations of emergency, and issuance of a variety of “stay home” orders—typically instructing all but “essential personnel” to remain in their residences other than to gather necessaries. These events have dramatically impacted the world economy, and wreaked havoc on the day-to-day functions of individuals and businesses in the United States and elsewhere. Does this pandemic and resultant disruption constitute a force majeure event under Louisiana and Texas law?
Continue Reading COVID-19 as a Force Majeure? The Texas and Louisiana Perspectives
The saga of the U.S. Customs and Border Protection’s (CBP) ten-year effort to amend its interpretation of key components of the Jones Act continues. After failed attempts to expand the scope of the Jones Act’s prohibition on activities by non-coastwise endorsed vessels in 2009 and 2017, CBP recently published a notice of proposed modification and revocation of certain ruling letters interpreting the Jones Act (see https://liskow.sharefile.com/d-s45a327d7ae7441e9). Unlike its recent, unsuccessful efforts to amend its interpretations, the current proposal attempts to expand one prohibition while narrowing another.
Continue Reading Possible Change to Jones Act Interpretations Regarding Coastwise Activities
Commercial and employment agreements often include provisions requiring arbitration of disputes between the parties. Some of these agreements contain “delegation clauses” requiring the arbitrator (as opposed to a court) to decide whether the dispute is subject to arbitration. Despite such provisions, one party may sue the other because it perceives an advantage to proceeding in court or wants to test the outer limits of the arbitration provision. The first battle in these suits is over who—the court or an arbitrator—decides whether the dispute must be arbitrated. In unanimous decisions issued over the last week, the Supreme Court addressed two scenarios where the parties fought over this question, despite having delegated questions of “arbitrability” to an arbitrator. Read together, the Court’s decisions clarify that a court should first decide whether the Federal Arbitration Act (“FAA”) applies to the parties’ agreement. If so, the court must honor the delegation clause and refer the matter to arbitration.
On Thursday, a divided panel of the Texas Court of Appeals in Houston held that the 2014-2015 drop in oil prices is not a force majeure for purposes of general force majeure contractual protection. In TEC Olmos, LLC v. ConocoPhillips, the court addressed a dispute between ConocoPhillips Company and TEC Olmos over a farmout agreement that required Olmos to commence drilling by a specified date. No. 01-16-00579, 2018 WL 2437449 (Tex. App. —Houston May 31, 2018). During the interval between execution of the agreement and commencement of drilling, however, changes in the global supply and demand of oil caused the price of oil to drop significantly. As a result, Olmos was unable to secure financing for drilling and informed ConocoPhillips that it would be unable to meet its drilling obligations. ConocoPhillips filed suit against Olmos and the guarantor of the contract, Terrace Energy Company, for breach of the farmout agreement. The lawsuit sought $500,000 in liquidated damages.
Continue Reading Texas Court Holds Drop in Oil Prices is Not Force Majeure
The United States Court of Appeals for the Federal Circuit recently issued a significant opinion in a case in which a takings claim was asserted to redress Hurricane Katrina-related flood damage. On April 20, 2018, it reversed a decision of the United States Court of Federal Claims (“Claims Court”), which had held the U.S. Army Corps of Engineers liable under the Tucker Act for flood damage to the Plaintiffs’ properties.
In 1968, the Corps completed construction of the Mississippi River Gulf Outlet (“MRGO”) in New Orleans. The purpose of this navigation channel was to increase commerce between the port of New Orleans and the Gulf of Mexico. Around the same time, Congress authorized funding for flood control through the Lake Pontchartrain and Vicinity Hurricane Protection Project (“LPV”). This project was instituted to reduce the risk of flooding in New Orleans, and it resulted in the construction of levees and floodwalls along the banks of MRGO.
Continue Reading Federal Circuit Holds U.S. Army Corps of Engineers Not Liable for Hurricane Katrina Flood Damage