New Final Regulations on Hardship Distributions from 401(k) and 403(b) Plans

Previous regulations on hardship distributions from 401(k) and 403(b) plans generally provided that a participant could receive an in-service distribution prior to reaching age 59½ if the participant had an immediate and heavy financial need. The determination of whether a participant had an immediate and heavy financial need was determined based on all relevant facts and circumstances. However, to simplify administration, the regulations provided for safe-harbor hardship withdrawals that were deemed to be an immediate and heavy financial need.

Late last month, the IRS published final regulations that significantly relaxed some of the requirements under the safe-harbor provisions. Some of the changes are mandatory and some are permissive. The changes are discussed in detail below.

Louisiana Investment Adviser Update
• Top 10 Advisers in Louisiana
• SEC Issues New Proxy Guidance for Advisers

By John C. Anjier on October 22, 2019 Posted in Business, Business Law, Securities

Top 10 Louisiana Advisers

For this edition, I thought that we would look at the top ten SEC registered investment advisers within the State of Louisiana. The SEC publishes a comprehensive database that captures all information submitted by advisers in their Form ADV’s. There is a total of 55 advisers registered with the SEC in Louisiana. Using this data, we came up with a list of the top Louisiana registered investment advisers by assets under management (“AUM”) and by number of accounts. For purposes of these rankings, we excluded advisers that are: (i) headquartered out of state, (ii) did not provide advisory services to the public, or (iii) umbrella organizations for groups of unaffiliated advisers. For the ranking of advisers by number of accounts, we included a column showing the percentage of accounts that are held by individuals, who are not high net worth individuals (net worth >$2.1 million).

There is a lot of data that we did not publish. Let us know if there is a data summary that you would like to see.

Fifth Circuit Opens Door to Removal Following Involuntary Dismissal of Non-Diverse Defendant

By Philip Dore and Mark Deethardt on September 9, 2019 Posted in Civil Procedure, Litigation, Louisiana Law

When is a case removable to federal court? The general rule is that removability is determined at the time a case is filed. One exception is the so-called “voluntary-involuntary” rule, which permits removal only when the plaintiff’s voluntary action in state court creates federal jurisdiction. The textbook example is the voluntary dismissal of a non-diverse defendant who settled with the plaintiff. The textbook counterexample is when the non-diverse defendant is dismissed via contested motion—an involuntary dismissal. In Hoyt v. The Lane Construction Corporation, 927 F.3d 287 (5th Cir. 2019), the Fifth Circuit blurred the line between these categories and expanded the cases that can be removed to federal court.

Liskow & Lewis Secures Key Rulings in Class Action Litigation

By Shannon S. Holtzman and A'Dair Flynt on August 8, 2019 Posted in Appellate, Business Litigation, Class Actions, Louisiana Law, Tax

Liskow & Lewis’ Shannon Holtzman, James Brown, and A’Dair Flynt recently secured several key rulings in a putative class action, successfully opposing a complex remand motion under the Tax Injunction Act and the Class Action Fairness Act (“CAFA”) and obtaining a dismissal with prejudice of the claims against Liskow’s clients in Robert J. Caluda, APLC, et al v. The City of New Orleans, Linebarger, Goggan, Blair & Sampson, L.L.P, and United Governmental Services of Louisiana, Inc., No. 19-2497, 2019 WL 3283138, 2019 WL 3291014 (E.D. La. July 22, 2019).

New Final Regulations Expand the Availability of HRAs

By Michael Williams and Regan Canfill on July 11, 2019 Posted in Business, Employee Benefits, Tax

On June 13, 2019, the Department of Labor, the Department of Health and Human Services, and the Department of Treasury (the “Departments”), published final regulations which significantly broaden the types of health plans that may be integrated with a health reimbursement arrangement (“HRA”). More specifically, beginning January 2020, the finalized rules allow HRAs to be integrated with certain qualifying individual health plan coverage and/or Medicare. The final rules reverse current guidance which requires HRAs to be integrated with only qualifying group health plan coverage. Practically speaking, this means that employers, beginning in 2020, will be allowed to subsidize employee premiums in the individual health insurance market and/or Medicare using pre-tax dollars, provided certain conditions are met. The final rules also allow certain HRAs to reimburse participants for certain premiums paid for excepted benefits. To achieve these results, the final rules create two new types of HRAs.

Texas Supreme Court to Review $500 Million Verdict in Case Involving Formation of Partnership to Construct Crude Oil Pipeline

By Katie Seegers Roth on July 3, 2019 Posted in Business Law, Contracts, Energy & Natural Resources, Energy Litigation, Industry News, Litigation, Oil & Gas, Pipeline, Texas

Last week the Texas Supreme Court granted review in Energy Transfer Partners, L.P. v. Enterprise Products Partners, L.P., a case concerning Texas partnership law. Energy Transfer Partners has garnered significant amicus support on both sides of the “v.” and has been closely followed by the energy industry.

SCOTUS Decides Dutra Group v. Batterton

Today the United States Supreme Court issued its decision in this landmark case concerning punitive damages. The six justices in the majority opinion reversed the Ninth Circuit and resolved a circuit split on this issue. The question presented was whether punitive damages may be awarded to a Jones Act seaman in a personal injury suit alleging a breach of the general maritime duty to provide a seaworthy vessel. Justice Alito wrote the majority opinion, joined by Chief Justice Roberts, Justices Thomas, Kagan, Gorsuch, and Kavanaugh. Justice Ginsburg dissented, joined by Justices Breyer and Sotomayor.

Supreme Court Holds State Wage and Hour Laws are Inapplicable to Offshore Drilling Platforms

In a decision that could have far-reaching implications, the United States Supreme Court issued a June 10 opinion holding that California’s wage-and-hour laws do not apply to workers on oil and gas platforms located in open water on the Outer Continental Shelf. The plaintiffs in Parker Drilling Management Services, Ltd. v. Newton, were offshore rig workers who filed a class action asserting that their employer violated California’s minimum wage and overtime laws by failing to pay them for stand-by time while they were on the drilling platform. Both parties agreed that the platforms were governed by the Outer Continental Shelf Lands Act (“OCSLA”), but they disagreed regarding whether the California’s wage-and-hour laws were incorporated into OCSLA and therefore applicable to workers on the platform. Continue Reading

Latest Guidance on Fiduciary Duties

By John C. Anjier on June 13, 2019 Posted in Business Law, Securities

The June 5 Releases

Today we focus on the new SEC interpretative release on the fiduciary duties of investment advisers and provide a brief summary of its contents (“The Fiduciary Duty Release”).[1] This Release is part of a package of new rules and interpretations adopted by the SEC on June 5, 2019. In total, there are four new rules and interpretations:

Regulation Best Interest (“BI”);
Form CRS, a new form for advisers and brokers;
the Fiduciary Duty Release; and
the Release on the “solely incidental” investment adviser exclusion.[2]

Together these four Releases total a mammoth 1336 pages and define and differentiate the duties owed by brokers and investment advisers.

Privilege Claw-Back Provision Upheld by Delaware Courts

By Nina Skinner on June 4, 2019 Posted in Business, Business Law, Mergers & Acquisitions

In Great Hill Equity Partners IV, LP v. SIG Growth Equity Fund I, LLLP, 80 A.3d 155 (Del. Ch. 2013), the Delaware Court of Chancery clarified that under Delaware law the privilege for pre-merger communications passes to the surviving company after a merger is consummated. The privilege transfer would include the privilege for pre-closing communications regarding the merger itself. The communications at issue in Great Hill were the sellers’ pre-closing communications with the target company’s outside counsel that were in buyer’s possession post-close. The Court urged merger parties to consider the need for contractual provisions that would protect against a privilege transfer should a different result be desired, the so-called privilege claw-back provision, which was absent from the Great Hill merger agreement.