By Jessica Engler

  • This article originally appeared in the Fall 2017 edition of DRI’s In-House Defense Quarterly

On March 11th of this year, the Defend Trade Secrets Act (DTSA) celebrated the one-year anniversary of its enactment.  The DTSA, 18 U.S.C. Section 1831, et seq. expanded the federal legal protection for holders of trade secrets presently offered to holders of copyrights, trademarks, and patents.  As of April, 2017, approximately 129 DTSA cases have been filed in federal court since the DTSA’s enactment.

Read the entire article here:  Defend Trade Secrets Year One

 

By Daniel Stanton

On September 28, 2017, President Trump granted a ten day waiver of the Jones Act for the island of Puerto Rico, a U.S. territory, in an effort to facilitate the island’s recovery from Hurricanes Irma and Maria.  The waiver went into effect immediately and alleviates the Jones Act’s restriction against the transport of passengers and cargo between U.S. ports, which includes Puerto Rico, by foreign flagged, foreign owned, or foreign crewed vessels.   A similar waiver was issued for the states of Texas and Florida in response to Hurricanes Harvey and Irma.

The Merchant Marine Act of 1920, commonly known as the Jones Act, was developed to afford protections to the then fledgling U.S. maritime industry.  In an effort to foster U.S. shipbuilding, shipping, and seafaring, the Jones Act required vessels transporting passengers and goods between U.S. ports to be built in the U.S., to be owned by U.S. individuals or entities, and to be U.S. flagged.  The Jones Act also required all licensed crewmembers serving aboard vessels engaged in trade between U.S. ports to be U.S. citizens.  The Jones Act also established a system of legal rights, remedies, compensation benefits, and procedural requirements for injured American seaman, much like state and federal workers’ compensation schemes.

By Michael J. O’Brien

Yesterday, the U.S. Fifth Circuit Court of Appeals released its decision in USA v. Don Moss, et al., 2017 WL 4273427 (5th Cir. 2017) affirming the Eastern District’s ruling that oilfield contractors cannot be held liable for criminal violations of the Outer Continental Shelf’s Lands Act (OCSLA), 43 U.S.C.§ 1331, et seq.  This is an important decision for all offshore contractors who were concerned about the Government’s intended criminalization of offshore accidents.

Moss stemmed from the November 16, 2012, explosion aboard the West Delta 32 Oil Production Platform located in the Gulf of Mexico. On November 16, 2012, independent contractors of the platform owner were performing repairs and modifications to the platform when the fatal explosion occurred. Three contractors were killed, several others were injured and oil was discharged into the Gulf.

Three years after the explosion, the USA issued criminal indictments against the owner/operator of the platform and the owner’s independent contractors that were working aboard the platform. In addition to charges related to the Clean Water Act, the contractors were also charged with multiple counts of knowing and willfully violating OCSLA’s regulations. At the district court level, the contractor defendants moved to dismiss the OCSLA charges on the grounds that the OCSLA regulations do not apply to oilfield contractors. The District Court agreed and dismissed the OCSLA charges against the contractors. The DOJ filed a timely appeal.

Central to the analysis of the District Court was OCSLA’s definition of the term “You” under the “BSEE Regulations” within the Code of Federal Regulations. 30 CFR §250.105 defines “You” as a “lessee, the owner or holder of operating rights, a designated operator or agent of the lessee(s), pipeline right-a-way holder, or a state lessee granted a right of use easement.” The District Court held that the definition of “You” “does not include oilfield contractors, subcontractors, or service providers.”

The Fifth Circuit agreed with the District Court’s analysis of the definition of “You.” Finding that the definition of “You” is unambiguous and limited in scope, the Moss Court held that the definition excludes contractors. Thus, the relevant OCSLA statues place criminal exposure squarely on the lessees and permitees not only for their own misfeasance, but also for that of the contractors and subcontractors they hire. The Fifth Circuit also noted that when the OCSLA regulations were first proposed, the intent was to hold operators responsible for their contractors’ actions and not to expand regulatory liability to contractors.

The Fifth Circuit was also influenced by the fact that for over a sixty (60) year period, the USA had only sought to enforce civil penalties against owner/operators, and it had never successfully criminally prosecuted a contractor under OCSLA. Indeed, the Federal Government did not regulate or prosecute oil field contractors as opposed to lessees, permitees, or well operators under OCSLA. Significantly, in March 2011, BSEE conducted a public workshop for oil and gas companies and advised in “bold fully capitalized underlined text” that the definition of “You” does not include a contractor. BSEE had also gone on record in 2010 that it “does not regulate contractors; we regulate operators.”

It was only until 2012, after the Deepwater Horizon Spill and a few months before the West Delta 32 explosion, that BSEE issued an “Interim Policy Document” opining that contractors may be liable for civil penalties under OCSLA. This change in policy was not entirely surprising given the view of the offshore industry by the administration at that time. However, the document made no mention of holding contractors criminally liable. As such, the Fifth Circuit determined that the consistency of over sixty (60) years of prior administrative practice in eschewing direct regulatory control over contractors, subcontractors, and individual employees supported the District Court’s conclusion that OCSLA regulations neither apply to, nor do they potentially criminalize, contractor conduct.  The “virtually non-existent past enforcement” of OCSLA regulations against contractors confirms that the regulations were never intended to apply to contractors. Ultimately, the Fifth Circuit held that while it was “novel” for the government to indict contractors for OCSLA violations, no judicial decision has supported such an indictment which was “at odds with a half  century of agency policy.”

Interestingly, the Fifth Circuit also commented on the pending appeal in the matter of Island Operating, Co. v. Jewell, 2016 WL 7436665 (W.D. La. 2016) where the District Court held that contractors could not be subject to a regulatory penalty or fine under OCSLA for Incidents of Non-Compliance (INC). In Moss, the Fifth Circuit indicated that it would not defer to the USA’s new policy position that contractors can be liable for civil and criminal penalties citing the 2011 “about face” that “flatly contradicts” the USA’s earlier interpretation of OCSLA’s regulations. The Fifth Circuit’s decision can easily be read to predict how the court will come down in Island Operating. So, while it is settled within the U.S. Fifth Circuit that the Federal Government (through BSEE) cannot criminalize a violation of Part 250 of the CFR’s (the BSEE Regs), this should not be read to expand that prohibition of criminal enforcement against contractors should other federal statutes, such as the Clean Water Act, be violated.

By Carrie R. Tournillon

The Louisiana Public Service Commission (“LPSC”) voted at its meeting on September 20, 2017, to reconsider and approve adoption of proposed rules that provide guidelines for certification of motor carriers of waste and create a rebuttal presumption that granting a certificate is in the public interest if the applicant has met the application requirements.  Under the new rules, applicants are still required to prove “public convenience and necessity” (“PC&N”), including having third-party shippers provide affidavits in support of the need for the certificate.

The new rules set forth, separately for applicants for contract carrier permits and common carrier certificates, the application minimum requirements, the applicant’s burden of proof, and the process for LPSC Staff review of the application and docketing of the matter.  Once an application is reviewed by Staff, a Staff Report will be issued recommending approval, conditional approval or denial of the requested authority.  The matter will then be docketed and published in the LPSC Official Bulletin for possible intervention, discovery, and assignment to an Administrative Law Judge, if contested, for setting a hearing on the merits.

As Kean Miller previously reported, earlier this year the Louisiana Legislature passed Act 278, which eliminated the requirement to prove PC&N as an entry requirement to obtaining authority from the LPSC to become an approved “common carrier” of waste within the state. In prior meetings, the LPSC has discussed whether the new legislation is an unconstitutional infringement on the jurisdiction of the LPSC over common carriers and directed its Staff to file suit challenging Act 278 and to take all action necessary to protect the LPSC’s jurisdiction.

 

As we learned during the flooding in South Louisiana in August of 2016, the help of our neighbors and friends in Texas and around the country strengthened us, and allowed our communities to rebuild and flourish. That’s part of the reason Kean Miller donated a total of $25,000 this week to the Greater Houston Community Foundation, the United Way of Greater Houston, and the American Red Cross in lieu of our fall client event originally scheduled for today, September 16th.

Our thoughts and prayers are with our friends, colleagues and peers in Houston and Southeast Texas today, and in the weeks and months ahead.

People First.

By Tokesha Collins-Wright

On September 1, 2017, the Louisiana Department of Environmental Quality (“LDEQ”) updated the emergency order that was issued by the Governor of Louisiana on Thursday, August 24, 2017. That earlier emergency order put the entire State of Louisiana under a declaration of emergency and was to remain in place until Friday, September 22, 2017, unless terminated sooner. On September 1, 2017, the Governor issued an amended declaration of emergency that now applies only to the parishes that have been declared federal disaster areas (the “Order”). At the time of the signing of the Order, these federal disaster areas were Acadia, Allen, Beauregard, Calcasieu, Cameron, Iberia, Jefferson Davis, Natchitoches, Rapides, Sabine, Vernon, and Vermilion. If at any point additional parishes are also declared as federal disaster areas, then those parishes will also be included in the Order.

Among the matters covered in the Order:

  • Permittees with Louisiana Pollutant Discharge Elimination System (“LPDES”) permits should consider activating the upset provisions in their permits. LAC 33:IX.2701. An upset constitutes an affirmative defense to an action brought for non-compliance with such technology-based permit effluent limitations if the requirements of LAC 33:IX.2701.N.3 are met. This Order extends upset provisions to include water quality based effluent limitations. For upsets caused by Hurricane Harvey, the 24-hour oral notification is waived unless the non-compliance may endanger human health.
  • New emergency discharges, which are eligible for coverage under the LPDES General Permit LAG420000 (Short-Term and Emergency Discharges General Permit), and are located in an area that has been included in this Order are considered provisionally covered under the terms and conditions of the permit immediately and fully covered 72 hours after the postmark date or upon hand-delivery of a complete and correct Notice of Intent. The Notice of Intent shall be submitted no later than 10 business days after commencing discharge.
  • When handling and managing wastes generated as a result of Hurricane Harvey, owners and operators of solid waste management facilities and local governments shall adhere to the State of Louisiana “Comprehensive Plan for Disaster Clean-up and Debris Management” (the “Debris Management Plan”), except where the Debris Management Plan may be in conflict with the provisions of this Order, in which case the provisions of this Order shall prevail. The Debris Management Plan contains provisions and instructions for handling various types of waste material and for locating and receiving authorization for Emergency Debris Sites, which are sites that local governments and state agencies may “activate” upon the declaration of an emergency by LDEQ and the issuance of this Order.
  • LDEQ will consider, on an individual basis, requests for approval for open burning, by persons other than local governments or their agents, of storm-generated trees, leaves, vines, twigs, branches, grass, and other vegetative debris. Any such burning approved by the LDEQ must be conducted in compliance with the requirements of the Debris Management Plan and LAC 33:III.1109.D.6. Local governments and their agents shall follow the provisions of the Debris Management Plan.
  • Owners and operators of solid waste management facilities permitted by the LDEQ before Hurricane Harvey are authorized to make all necessary repairs to restore essential services and the functionality of storm water management and leachate collection systems damaged by Hurricane Harvey, without prior notice to the LDEQ. Within thirty (30) days of commencing the work of such repair or replacement, however, the permittee shall notify the LDEQ in writing, describing the nature of the work, giving its location, and providing the name, address, and telephone number of the representative of the permittee to contact concerning the work.
  • The LDEQ authorizes the minor repair of any previously permitted stationary source of air pollution that was damaged by the Hurricane to restore it to its previously permitted condition without prior notice to the LDEQ. Within thirty (30) days of commencing such repairs, however, the permittee shall notify the LDEQ in writing, stating the location and nature of the work and providing the name, address, and telephone number of the representative of the permittee to contact concerning the work.
  • LDEQ will consider, on an individual basis, requests for approval for, but not limited to, the following sources of air pollution:
    1. temporary air pollution control devices, such as portable flares, used for vessel and pipeline segment purging and the limited operation of facilities with damaged vapor control equipment;
    2. portable storage tanks, used for interim storage while damaged equipment is being repaired; and
    3. repairs, other than the minor repairs discussed above, of permitted stationary sources that have been damaged by the Hurricane, provided that the sources are restored or replaced with equipment that is identical or functionally.

All activities authorized under this Order must be commenced before the expiration of this Order unless otherwise provided in an authorization or permit. The deadline for commencement under any authorization or permit issued under this Order may be extended on a showing that contractors or supplies are not available to commence the work, or if additional time is needed to obtain any required authorization from the Federal Emergency Management Agency, the U.S. Army Corps of Engineers, or other local, state, or federal agencies.

The Order is set to expire on October 26, 2017, unless modified or extended by further order. For more information, click here.

By A. Edward Hardin, Jr., Brian R. Carnie, and Erin L. Kilgore

A Federal District Judge in Texas struck down an Obama administration Department of Labor Wage and Hour Division rule that would have nearly doubled the salary basis requirement for some exempt employees.  Had the rule remained in place, for certain exempt employees, employers would have had to roughly double the exempt employees’ salaries to maintain the employees’ exempt status, or treat the employees as eligible for the overtime premium.  In November, the court issued a nationwide injunction stopping the rule from going into effect.  This ruling likely moots the pending appeal of the injunction, and it seems unlikely that the Trump administration will appeal this latest ruling given that the administration has already begun laying the groundwork for a possible revision of the prior rule.  Stay tuned.

Read the article here.

By R. Lee Vail, P.E., Ph.D. and Lauren J. Rucinski

On August 30, 2017 the D.C. Circuit denied environmental and labor groups’ request to stay the Tump EPA’s final rule delaying the Obama-era amendments to the EPA’s Risk Management Program (“RMP”) rule. The RMP rule implements Section 112(r) of the Clean Air Act and requires facilities that use extremely hazardous substances to develop and update a Risk Management Plan.

In June, the EPA Administrator Scott Pruitt signed a final rule to further delay the effective date of the RMP rule amendments until February 19, 2019 (“the Delay Rule”).  The delay allows EPA to conduct a reconsideration proceeding to review objections raised by petitioners to the final RMP amendments rule.[1]

Environmental and labor groups challenged the Delay Rule in the D.C. Circuit and then moved to stay the Delay Rule until the court takes full review of it. The groups’ motion requests a stay of the stay of the RMP rule until the court can review the merits of the Delay Rule—which stays the RMP rule. Try to say that five time fast. In any event, the D.C Circuit denied the groups’ motion to stay the Delay Rule. In denying the request for a stay, the D.C. circuit held that the environmental and labor groups had not “satisfied the stringent standards for a stay pending court review.”[2] Thus the Delay Rule will remain in effect while the D.C. Circuit reviews the merits of the groups’ challenge.

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[1] 82 Fed. Reg. 27133 (June 14, 2017).

[2] The Court also denied EPA’s motion for additional briefing time on the merits of the groups’ challenge.

Unprecedented flooding has severely impacted the City of Houston and Southeast Texas due to Hurricane Harvey.  In August 2016, South Louisiana and the Capital Region were affected by a major rain and flood event.  In response, Kean Miller created the South Louisiana Flood section of our Louisiana Law Blog as a legal resource for those impacted by the Louisiana flood.  Today, we have launched the Hurricane Harvey section of our blog to provide additional legal resources to our friends, contacts, and clients in Texas and those affected in Southwest Louisiana.

The August 2016 flood taught us many things, and Kean Miller has a unique familiarity with flood relief efforts.  From organizing work teams equipped to rebuild homes, to collecting and distributing relief supplies, we have information and ideas that may help.  Our Director of Human Resources, Mary Coghlan, led our internal relief efforts and is available to consult with any of the law firms or clients affected by the Texas flood.  She can be reached at 225-382-3488 or mary.coghlan@keanmiller.com

Although there is still much work to do, we know the strength of the people in Texas will see them through this historic event.  Our continued thoughts and prayers are with our friends, clients and contacts in Houston and anyone affected by this unprecedented event.

By Jeffrey N. Boudreaux

Earlier this week, the Texas Supreme Court and the Texas Court of Criminal Appeals issued an emergency order to allow the courts affected by the disaster to suspend regular court procedures and deadlines. The order is effective for one month and states in part:

Pursuant to Section 22.0035(b) of the Texas Government Code, all courts in Texas should consider disaster-caused delays as good cause for modifying or suspending all deadlines and procedures – whether prescribed by statute, rule, or order – in any case, civil or criminal.

Misc. Doc. No.17- 9098.

Yesterday, the Court added a formal judicial suspension of all deadlines to the otherwise applicable statute of limitations which states in part:

Inasmuch as statutes of limitations are not subject to a good-cause exception, the Supreme Court now further orders, again pursuant to Section 22.0035(b), that any applicable statute of limitations is suspended for any civil claim if the claimant shows that the disastrous conditions resulting from Hurricane Harvey prevented the timely filing of the claim despite the party’s and counsel’s diligent efforts.  Any such suspension extends only to the date on which it becomes reasonably possible to file the claim despite the disastrous conditions, taking into account the circumstances.

Misc. Doc. No. 17- 9091

Unlike the Louisiana Executive Order JBE 16-66, issued last year following the catastrophic flooding in Baton Rouge and similar orders issued in previous years (by previous Governors) which suspended the applicable prescriptive period, the Texas Order still requires some showing of  that the claimant attempted to timely file its claim.

At this juncture, it is premature to speculate on what level of proof will be required for a claimant to take advantage of the suspended deadlines, but it is clear some standard of proof will be required

The link to determine whether a particular court is closed can be found here.