On August 12, 2016, the Secretary of the Louisiana Department of Environmental Quality issued an Emergency Administrative Order to provide relief from otherwise applicable state-issued environmental permit terms and rules in order to manage the situations created by the unprecedented flooding in southern Louisiana. The Order is available here.  The Order applies to the same parishes that the Governor has declared to be within the emergency area:  Ascension, East Baton Rouge, East Feliciana, Iberia, Iberville, Lafayette, Livingston, St. Helena, St. James, St. Tammany, Tangipahoa, Washington and West Baton Rouge.  It is effective until 11:59 p.m. on September 12, 2016.

Past experience has indicated that these types of emergency orders are often amended to cover additional areas, extend the time period, or to add other relief.

This link summarizes the key provisions of the Order:  Key Provisions – Emergency Administrative Order.

Note that this Order applies only to state issued permits and regulations.  For further information on any updates to the Order, click here.

In the wake of recent flooding in Louisiana, Governor Edwards has issued Executive Order JBE 2016-53, suspending all legal deadlines, including liberative prescriptive and peremptive periods, in all state courts and regulatory agencies. The order applies retroactively from Friday, August 12, 2016, and will last through Friday, September 9, 2016, providing a 28 day suspension period. As a result, the period of time in which a party must file suit has been temporarily suspended from August 12, 2016 through September 9, 2016. On September 10, 2016, the prescriptive and peremptive periods will begin running and the time which preceded the suspension should be added to the time which follows it to determine the necessary prescriptive or peremptive period. Therefore, parties who currently have prescriptive or peremptive periods running will have an additional 28 days to file suit before those periods accrue.

Executive Order JBE 2016-53 also temporarily suspends legal delays, such as those pertaining to service deadlines, motions for new trial, motions for judgment notwithstanding the verdict, suspensive appeals, and devolutive appeals. Again, the suspension will not commence these delays anew, but temporarily halt their running.

Executive Order JBE 2016-53 applies to all deadlines found in the Louisiana Civil Code, the Louisiana Code of Civil Procedure, Title 9 (Civil Code Ancillaries) Title 13 (Courts and Judicial Procedure), Chapter 11 of Title 18 (Election Campaign Financing); Chapter 10 of Title 23 (Worker’s Compensation); Chapter 5, Part XXI-A of Title 40 (Malpractice Liability for State Services); Chapter 5, Part XXIII, of Title 40 (Medical Malpractice), and Title 49, Chapter 13 (Administrative Procedure) of the Louisiana Revised Statutes

A copy of Executive Order JBE 2016-53 can be found here.

If you have suffered any type of property damage loss due to the flooding in Louisiana, there are certain steps you can take to maximize your ability to get compensation or benefits for your loss. Unfortunately, too many families were caught unexpected by what is being referred to as a “500 year flood;” many of whom did not have flood insurance.

If you had flood insurance, it is important to notify your insurance agent as soon as possible to file a claim. Next, while your instinct may be to start salvaging what you can and removing carpets to avoid mold, make sure that you document the damage to your property as much as you can. This includes your discarded objects, structural damage, and standing floodwater levels. If you can, make a list of lost or damaged items, including their date of purchase, and salvage any records or receipts that you can for items on that list. Lastly, you will need to complete a Proof of Loss, which is your statement (under oath) of the accuracy of your claim. Your adjuster should assist you in this process, but a copy of this form can be found here.

The Federal Government has issued a Major Disaster Declaration for the following parishes: Acadia, Ascension, East Baton Rouge, East Feliciana, Iberia, Lafayette, Livingston, Pointe Coupee, St. Helena, St. Landry, Tangipahoa, and Vermilion. Residents in these parishes are approved to apply for disaster assistance from FEMA  Even if you do not reside in one of the listed parishes, but were affected by the flooding, you are encouraged to apply for assistance. You can also register by phone at: 1-800-621-FEMA (3362).

Residents and business owners should apply as quickly as they can, even if they have insurance. FEMA cannot duplicate insurance payments, but underinsured applicants may receive help after their insurance claims have been settled. At some point, FEMA will set a deadline to register, so pay attention to FEMA’s website regarding the flood.  This site also has resources for finding missing loved ones and shelter.

Assistance provided by FEMA for homeowners and renters can include grants for rent, temporary housing and home repairs to their primary residences, as well as other serious disaster-related needs, such as medical and dental expenses, or funeral and burial costs.

Low-interest disaster loans from the U.S. Small Business Administration (SBA) also may be available to help individuals and business owners recover from the effects of the disaster. SBA helps businesses of all sizes, private nonprofit organizations, homeowners and renters fund repairs or rebuilding efforts and cover the cost of replacing lost or disaster-damaged personal property. The loans cover losses not fully compensated by insurance or other recoveries and do not duplicate benefits of other agencies or organizations.

Residents are urged to contact their insurance company first to file their flood insurance claims. For flood insurance policyholders who may have questions, FEMA has aligned its call center to better support them with the servicing of their claims and getting answers to their questions quickly. Policyholders may call 1-800-621-3362 Monday through Friday from 8 a.m. to 6 p.m. and select Option 2. Call center staff are available to assist policyholders with information regarding their policy, offer technical flood guidance to aid in recovery, and respond to general as well as complicated questions about the NFIP. Policyholders with questions specifically about an insurance claim can be transferred to their insurance carrier for additional assistance.

The statutory and regulatory deadline for appealing an adverse decision of the Louisiana Tax Commission (the “Commission”) is clearly thirty (30) days, but identifying the event that triggers commencement of the deadline has not always been easy. The applicable statute provides that the appeal deadline runs from the date the decision is “entered,” while the applicable administrative rule provides that the deadline runs from the date the decision is “mailed.” A decision from the Fourth Circuit Court of Appeal had previously held that a decision was “entered” on the day that the members of Commission signed the decision. In that case, the decision was signed and mailed on the same day.

The courts have finally clarified when the 30 day appeal period begins to run, hopefully resolving this issue for good.  In Erroll Williams v. Hotel Ambassador NOLA, LLC, No. 2016-CA-0015 (La. App. 4 Cir. 6/15/16), ___ WL _____, the Commission mailed its decision some eight (8) days after the decision was signed by the members of the Commission. In Halliburton Energy Services, Inc. v. Bossier Parish Board of Review, No. 50,734-CA  c/w 50,735-CA (La. App. 2 Cir. 8/10/16), ___ WL ___, the Commission mailed its decision some sixteen (16) days after it was signed.  In both cases, the aggrieved litigant appealed within thirty (30) days of the mailing date, but the district courts in each case found the appeal to be untimely. On appeal, both the Fourth Circuit and the Second Circuit noted that the applicable statute did not provide a specific definition of “entry” of judgment. Surveying the cases, the Courts noted that entry of judgment may be the date of signing, but it may also include the date of distribution or the date of mailing. The Courts gave great weight to the fact that each decision stated that it would become effective upon date of issuance (yet another term that is not defined in the applicable statute or administrative rule), and that each decision bore a “true copy” stamp that suggested that the Commission had entered that decision into its own records on that date.

Accordingly, the Courts concluded that entry of judgment occurs on the date that the decision is mailed.  As such, each appeal was found to have been timely filed.  Both Courts recognized the due process principles that compelled them to hold that entry of judgment cannot occur earlier than the date on which the decision is mailed, noting that to hold otherwise could allow the appeal delay to lapse before the affected party is even sent notice of the decision against it.  In each case, the Court reversed and remanded the case to the district court for further proceedings.

The first of many coastal land loss lawsuits filed by Louisiana coastal parishes has proceeded to judgment, with the result being the dismissal of the case based on the failure to exhaust administrative remedies prior to filing suit.

Since the filing of the politically-charged Southeastern Louisiana Flood Protection Authority lawsuit, four parishes – Plaquemines, Jefferson, and more recently Cameron and Vermilion – have filed 40 similar lawsuits against oil and gas exploration and production companies, and pipeline companies, alleging that these companies violated the State and Local Coastal Resources Management Act of 1978 (“SLCRMA”) and, in doing so, caused or contributed to coastal land loss. The foundation of the parish plaintiffs’ claims is that the oil and gas companies performed certain activities in Louisiana’s coastal zone either (i) without the Coastal Use Permits required by the SLCRMA or (ii) or in violation of the Coastal Use Permits which were issued under the SLCRMA. Recently, the Louisiana Attorney General and the Louisiana Department of Natural Resources, Office of Coastal Management (the “Intervenors”) intervened in the lawsuits, joining with the parish plaintiffs in order to ensure the protection of the State’s interests.

The oil and gas company defendants have raised various exceptions to the claims of the parishes and Intervenors, including the defense that the lawsuits are premature because the plaintiffs failed to pursue the administrative remedies available under the SLCRMA and related regulations prior to filing suit. This argument was considered in the case of The Parish of Jefferson v. Atlantic Richfield Company, et al., No. 732-768, 24th Judicial District Court, Jefferson Parish, with Judge Stephen D. Enright, Jr. issuing a Judgment on August 1, 2016 (published on August 8, 2016) agreeing with the oil and gas company defendants and dismissing the claims of Jefferson Parish and the Intervenors as premature for failure to exhaust administrative remedies.

In his Judgment, Judge Enright found that a comprehensive administrative remedy exists under the SLCRMA and the Louisiana Administrative Code (particularly La. Admin. Code tit. 43, pt. I sec. 723(D)(1-4)) to address potential violations of Coastal Use Permits. Accordingly, the Court ordered that Jefferson Parish and the Intervenors must pursue and exhaust this administrative remedy process prior to bringing suit in court seeking civil damages. As the Court stated, “in the absence of an exhaustion of administrative remedies, it is yet to be determined whether civil damages exist.”

While Jefferson Parish has indicated that it will file a motion for a new trial and/or appeal to the Louisiana Fifth Circuit, the Louisiana Attorney General Jeff Landry issued a statement on August 10, 2016, indicating that he will not seek to challenge Judge Enright’s ruling because the ruling is protective of the State’s interest, in that it allows the Louisiana Department of Resources to determine whether any violations of Coastal Use Permits have occurred through the administrative process established by the SLCRMA and the Louisiana Administrative Code. As stated by Attorney General Landry:

addressing the issues associated with permit violations through the administrative process is a cost-effective, efficient way to resolve any violations. That was clearly the purpose of the Legislature creating this regulatory scheme. I believe the Secretary of the Department of Natural Resources has been given ample tools by the Legislature to address these issues.

Full Statement.

While a victory for the oil company defendants, it is still expected that additional parishes will file coastal land loss lawsuits. We will continue to report on key developments in these cases.

Ransomware is here to stay. According to a recent United States Government interagency report, on average, there have been approximately 4,000 daily ransomware attacks since early 2016, which is a 300 percent increase from the approximately 1,000 daily ransomware attacks reported in 2015.[1] A significant percentage of those affected by ransomware have been healthcare providers who are subject to the Health Insurance Portability and Accountability Act (“HIPAA”).

Ransomware is a form of malware that targets a user’s critical data and systems in order to extort payment for restoration of the data or system. After the user is locked out of their system, the perpetrator will demand a ransom payment in order to have the data restored. Else, the data will be deleted or permanently encrypted. After the user sends payment, the perpetrator will provide the victim an avenue to regain or access the data.

The healthcare industry is particular vulnerable to this cyber activity because ransomware can block access to electronic medical records, which can disrupt patient care.[2] In February, attackers held data belonging to the Hollywood Presbyterian Medical Center in Los Angeles for ransom using a piece of ransomware called “Locky.” The hospital remained offline for over a week until hospital officials caved to the demands and paid the equivalent of $17,000 in Bitcoin.[3] Other hospitals and healthcare providers have faced similar attacks.[4] According to new research by Solutionary, an Omaha-based security firm, healthcare organizations were 114 times more likely to be hit by ransomware infections than financial firms, and 21 times more likely than educational institutions.[5] This increase of attacks and threat to healthcare records caused lawmakers to push the U.S. Department of Health & Human Services (“HHS”) for guidance regarding ransomware cybersecurity attacks—particularly on the points of reporting attacks and whether such attacks are considered a violation of HIPAA.

On July 11, 2016, the Office for Civil Rights (“OCR”) issued new guidance on how to handle ransomware attacks under HIPAA. This new guidance discusses how the security requirements under HIPAA can help organizations prevent, detect, and recover from ransomware attacks. The OCR guidance expressly provides that the presence of ransomware on a computer system is a “security incident” under the HIPAA Security Rule and, therefore, an entity impacted by such ransomware must initiate security incident and response and reporting procedures.  Additionally, the OCR guidance addresses whether a ransomware infection is considered a “breach” under HIPAA.

Whether or not the presence of ransomware will constitute a breach is a case-by-case determination. The HIPAA Rules define a “breach” as “the acquisition, access, use, or disclosure of Protected Health Information (“PHI”) in a manner not permitted under the [HIPPA Privacy Rule] which comprises the security or privacy of the PHI.”[6] In cases where electronic PHI is encrypted as a result of a ransomware attack, a breach has occurred because the ePHI encrypted by the ransomware was accessed and is consequently an impermissible disclosure under the HIPAA Privacy Rule. The entity must then comply with the applicable notification provisions under the HIPAA Breach Notification Rules, including notifying the affected individuals, the Secretary of HHS, and (if the breach affects more than 500 individuals) the media.[7]

Pursuant to the HIPAA Breach Notification Rule, a breach is presumed to have taken place unless the entity suffering the attack can show that there is a “low probability that the PHI has been compromised.”  To make such a determination, the entity must perform a risk assessment that considers, at a minimum, the following four factors:

  • The nature and extent of the PHI involved, including types of identifiers and likelihood of re-identification;
  • The unauthorized person who used the PHI or to whom disclosure was made;
  • Whether PHI was actually acquired or viewed; and
  • The extent to which the risk to the PHI has been mitigated.[8]

In its recent guidance document, OCR encourages entities to consider additional factors, such as the high risk of unavailability of the data or a high risk to data integrity.[9] This risk assessment must be thorough, completed in good faith, and reach conclusions that are reasonable given the circumstances. Further, the covered entity and business associates must maintain supporting documentation regarding the breach assessment—and, if applicable, notification—process, including documentation of: (1) the risk assessment demonstrating the conclusions reached; (2) any exceptions determined to be applicable to the impermissible use or disclosure of the PHI; and (3) all notifications that were made, if applicable.[10] Outside of this guidance, it is undetermined at this time what will satisfy the OCR that a particular ransomware attack qualifies as having a “low probability of harm.”

The full OCR guidance can be found on the HHS’s website, which also includes recommendations for protection of data in order to prevent a breach, as well as response and recovery from the ransomware attack.[11] It should be noted that this new guidance does not create new law. Rather, it is a clarification by OCR of federal law that has been in place since 2013, meaning that entities subject to HIPAA that have suffered a ransomware attack in the past three years may need to determine whether they need to report the incidents.

Data breaches are serious incidents. They can be even more serious and dangerous when patients’ medical records and medical care are at stake. It is recommended that healthcare entities, as well as their HIPAA business associates, consult with an attorney to ensure compliance with HIPAA before a breach happens, as well as immediately after a potential breach is discovered, to perform the proper due diligence and move in the right direction towards compliance and recovery.

_____________________________________________

[1] United States Government Interagency Guidance Document, How to Protect Your Networks from Ransomware, Justice.gov (available at https://www.justice.gov/criminal-ccips/file/872771/download).

[2] Kim Zetter, Why Hospitals are the Perfect Targets for Ransomware, Wired.com (13:31:00, Mar. 30, 2016) (available at https://www.wired.com/2016/03/ransomware-why-hospitals-are-the-perfect-targets/).

[3] Id.; Joseph Conn, Hospital Pays Hackers $17,000 to Unlock EHRs Frozen in ‘Ransomware’ Attack, Modern Healthcare (Crain Communications, Inc., Feb. 18, 2016) (available at http://www.modernhealthcare.com/article/20160217/NEWS/160219920).

[4] See, e.g., Bill Siwicki, Ransomware Attackers Collect Ransom from Kansas Hospital, Don’t Unlock All the Data, then Demand More Money, Healthcare IT News (HIMSS Media, 14:58:00, May 23, 2016) (available at http://www.healthcareitnews.com/news/kansas-hospital-hit-ransomware-pays-then-attackers-demand-second-ransom); Mike Miliard, Two More Hospitals Struck by Ransomware, in California and Indiana, Healthcare IT News (HIMSS Media, 10:55:00, Apr. 4, 2016) (available at http://www.healthcareitnews.com/news/two-more-hospitals-struck-ransomware-california-and-indiana); Joseph Conn, Patient Data Held for Ransom at Rural Illinois Hospital, Modern Healthcare (Crain Communications, Inc., Dec. 17, 2014) (available at http://www.modernhealthcare.com/article/20141217/NEWS/312179948).

[5] Meg Bryant, Healthcare Orgs at Much Higher Risk of Ransomware Attack Than Financial Institutions, Healthcare DIVE (Industry Dive, Jul. 28, 2016) (available at http://www.healthcaredive.com/news/healthcare-orgs-at-much-higher-risk-of-ransomware-attack-than-financial-ins/423395/); Maria Korolov, Health Care Organizations 114 Times More Likely to Be Ransomware Victims than Financial Firms, CSO (IDG, 5:00:00, Jul. 26, 2016) (available at http://www.csoonline.com/article/3099852/security/health-care-organizations-114-times-more-likely-to-be-ransomware-victims-than-financial-firms.html).

[6] U.S. Department of Health & Human Services Office for Civil Rights, Fact Sheet: Ransomware and HIPAA, HHS.gov (July 11, 2016) (available at http://www.hhs.gov/sites/default/files/RansomwareFactSheet.pdf).

[7] See 45 C.F.R. 164.400–414.

[8] 45 C.F.R. 164.402(2).

[9] Data integrity is an important consideration in the ransomware context, as many ransomware programs delete the original data and leave only the data in the encrypted form. Eric Schulwolf, HHS OCR Guidance on Ransomware Attacks: They Constitute a “Security Incident” and are Likely a Data Breach, JD Supra Business Advisor (JD Supra, LLC, Jul. 25, 2016) (available at http://www.jdsupra.com/legalnews/hhs-ocr-guidance-on-ransomware-attacks-11173/).

[10] 45 C.F.R. 164.530(j)(iv), 164.414, 164.402(1).

[11] See U.S. Department of Health & Human Services Office for Civil Rights, Fact Sheet: Ransomware and HIPAA, HHS.gov (July 11, 2016) (available at http://www.hhs.gov/sites/default/files/RansomwareFactSheet.pdf).

On August 2, 2016, the Treasury Department issued new proposed tax regulations that would substantially eliminate many of the valuation discounts used for transfer tax purposes by family-owned businesses.  The regulations disregard restrictions on the redemption and liquidation of a family-owned business for valuation purposes.  In effect, this would mean that the value of an ownership interest in a family-owned company would be valued as if the recipient could immediately cause a liquidation of the company and receive their proportionate share of the proceeds.

The new regulations provide that agreements (and even state laws) that restrict the ability of an owner of a family-owned business to force a liquidation of the business will be ignored for purposes of valuing an ownership interest.  Provisions of a company governance document, such as an Operating Agreement, or state law restricting the ability of an owner to force liquidation would be disregarded under such a valuation approach if the family members are able to change or remove the restriction.  Other disregarded restrictions will include any restriction on the timing of payments in liquidation beyond six months or any limitations on the value an owner would receive in liquidation.

These proposed regulations could severely limit the application of valuation discounts for lack of marketability or lack of control for transfers of closely-held business ownership interests between family members.  This type of discount planning is often used to great success in estate planning.  The proposed regulations, if adopted as final regulations as presently proposed, will present significant challenges to this type of planning in the future.

The regulations do not become effective immediately but will be effective for transfers of property that occur on or after the date the final regulations are adopted and published in the Federal Registry.  The Treasury Department will receive comments from the public and hold a public hearing on the proposed rules December 1st in Washington.  There is a minimum thirty day waiting period after that before the regulations can be adopted as final regulations.  Thus, taxpayers have at least until the end of the year to continue to use discount planning techniques.  If (or more likely when) the final regulations are adopted, a significant estate planning tool may be effectively eliminated so individuals and families with family businesses or significant wealth should consider transferring property prior to the end of 2016 or else risk losing the benefit of this type of discount planning to reduce their estate tax liability.

Louisiana law is clear – all claims against a contractor or design professional arising out of the planning, construction, design or building immovable or movable property must be brought within 5 years of the date of registry in the mortgage office of acceptance of the work by the owner.  If no such acceptance is recorded within six months of the date the owner occupied or took possession of the work, the claim must be brought within five years from the date of occupancy or possession. (La. R.S. 9:2772).  The five year period of time applies to all claims, including those claims made by one contractor against another.  The five year period cannot be interrupted, suspended or tolled.  If suit is not filed within five years, the right to file suit is lost.

Although enacted by the legislature to protect contractors, the statute creates a “trap for the unwary” for those involved in projects where partial certificates for substantial completion are issued.  For example, in the recent case Thrasher v. Gibbs Residential, LLC, 15-CA-607 (La. Ct. App. 4 Cir. 6/29/16) the court of appeal dismissed a general contractor’s claim against its subcontractor finding the claim was not timely.  The court found that the general contractor filed its claim more than 5 years from the date a partial certificate of substantial completion had been filed.  The general contractor unsuccessfully argued that it was improper to use a partial certificate of substantial completion because the project continued thereafter and additional certificates of substantial completion were ultimately filed.  In the ruling the court noted that the statute did not specify what must be filed to constitute acceptance by the owner.  The court also found that the parties were relying upon a recorded certificate of substantial completion as evidence of the owner’s acceptance.  The fact that the entire project had not reached substantial completion did not prevent the court from finding that a partial certificate of substantial completion was sufficient to start the clock.

To eliminate the uncertainty as to what will or will not start the five year period, the parties to a construction contract would be wise to include language in the contract establishing precisely what must be filed to constitute “registry in the mortgage office of acceptance”.

The internet has revolutionized the hospitality and service industry. Online travel companies (OTCs) such as Expedia, Priceline, Hotels.com, Orbitz, and Travelocity allow an internet user to visit a single website to search for all hotel rooms available in a specified area. In a single transaction, a customer can choose a hotel, book a room, and pay for their entire stay. Under what some courts have termed the “merchant model,”[1] a customer pays a lump sum to the OTC, which in turn sends a portion to the hotel to pay for the room and any hotel occupancy taxes. The OTC keeps the remainder as a service fee, which is how they generate a profit.

Cities and municipalities in 34 states, the District of Columbia, and Puerto Rico have begun suing OTCs claiming that the OTCs are not paying an adequate amount of taxes on the online bookings. These cities all have laws that impose hotel occupancy taxes on rooms rented to transients. They claim the occupancy tax should be paid on the lump sum the customer pays to the OTC, and not merely the amount the OTCs remit to the hotels. Despite the nationwide nature of this issue, court rulings on whether OTC services are indeed taxable under this model have lacked consistency. Part of the inconsistency stems from the differences in each local statute or ordinance, which tax the customer in some cases and the hotel in others.[2] Laws also vary in their definitions of key phrases, some of which are ambiguous, leaving a court to interpret them with little guidance.[3] In many cases, courts have found the OTC was not the “operator” of a hotel or a “vendor” – both of which are taxed under certain statutes or ordinances.[4] Overall, of the currently 49 decisions on the merits, 39 courts have concluded that OTC services were not taxable and 10 have decided that their services were taxable. To date, no federal circuit court has ruled that OTC services are susceptible to hotel occupancy taxes, but appeals in multiple federal district courts are currently pending.

In Louisiana, many cities impose a hotel occupancy tax on the hotel customer (occupant), but require the “dealer” to collect and remit the tax. Generally, tax collectors may seek to collect delinquent taxes (including, for delinquency due to insufficiency of an otherwise timely payment) from either the customer or the dealer. Laws defining “dealer” for purposes of the occupancy tax vary from city to city, however. In some cases, “dealer” is specifically defined as the owner or operator of a hotel. In others, “dealer” is defined in a way tax collectors will contend includes OTCs. Additionally, some cities impose occupancy taxes on the gross amounts charged to a customer, which may be read as including the OTCs service fee. Finally, there may be varying definitions among local laws of key terms, including “transient guest.”

Litigation similar to that in other states has yet to be filed in Louisiana; however, because this state is a tourist destination and a litigation hotbed, OTCs should be prepared. Litigation involving OTCs will surely come at some point as Louisiana cities discover the potential tax revenues available on OTC booking. If you or your client needs assistance evaluating state and local hotel occupancy tax statutes or preparing for what’s to come, Kean Miller is here to help.

***********

[1] In re Transient Occupancy Tax Cases (City of San Diego v. Hotels.com), 225 Cal.App.4th 56 (2014), review granted 329 P.3d 192 (Cal. 2014).

[2] See City of Atlanta v. Hotels.com, 710 S.E.2d 766 (Ga. 2011); Travelocity v. Wyoming Dept. of Revenue, 329 P.3d 131 (Wyo. 2014); City of Chicago v. Hotels.com, 2013 WL 3185061 (Il. Cir. Ct. Cook Cnty. No. 2005-L-051003, Jun. 21, 2013); Village of Rosemont v. Priceline, 2011 WL 4913262 No. 09-C-4438 (E.D. Ill. Oct. 14, 2011) (Finding that the language of the statute charged the amount paid by hotel guests, and thus the total amounts paid by OTC consumers were taxable). See also City of Birmingham v. Orbitz, 93 So.3d 932 (Ala. 2012). (finding that rather than taxing the customer, the statute taxes “every person, firm or corporation engaging in the business of renting or furnishing any room or rooms, lodgings, or accommodations are regularly furnished to transients for a consideration.”).

[3] See Expedia v. District of Columbia, 120 A.3d 623 (D.C. 2015) (defining the term “furnishing” of a hotel room); Louisville/Jefferson county Metro Gov’t v. Hotels.com, 590 F.3d 381 (6th Cir. 2009) (defining the phrase “like or similar accommodations businesses” to not include OTCs); City of Houston v. Hotels.com, 357 S.W.3d 706 (Tex. App. 14th Dist. 2011) (defining “cost of occupancy” not to include OTC service fees).

[4] See City of Goodlettsville v. Priceline, No. 3:05-cv-00561 (M.D. Tenn. Feb. 21, 2012); Expedia v. City of Anaheim, 2012 WL 5360907 (Cal. App. 2nd Nov. 1, 2012), rev. denied Jan. 23, 2013; In the Matter of Travelocity v. Dir. Of Taxation, 346 P.3d 157 (Haw.2015) (finding OTCs not classified as hotel “operator”); Expedia v. City and County of Denver, 2014 WL 2980979 (Colo. App. Jul. 3, 2014), appeal granted 2015 WL 5215961 (Colo. Sep. 8, 2015) (finding OTCs are not “vendors” under the statute.).

The Occupational Safety and Health Administration (“OSHA”) published a Request for Information (“RFI”) on December 9, 2013 concerning possible changes to the Process Safety Management (“PSM”) program codified at 29 C.F.R. 1910.119. See 78 Fed. Reg. 73756 (Dec. 9, 2013). Likewise, the Environmental Protection Agency (“EPA”) published an RFI on July 31, 2014 relating to possible changes to the similar Risk Management Program (“RMP”) rules codified at 40 C.F.R. Part 68. See 79 Fed. Reg. 44604 (July 31, 2014). In lieu of making some changes through rulemaking, OSHA chose to revise older policies. On June 5, 2015, OSHA issued an interpretation letter that addresses the method of determining whether chemical in a mixture exceeded a threshold quality.

In response, the American Chemical Council and the National Association of Chemical Distributors filed suit challenging the policy. On July 7, 2016, OSHA and the parties settled the suit and agreed to a revised policy. On July 18, 2016, OSHA rescinded and replaced that policy with a modified policy.

Whereas the general policy did not substantially change, OSHA agreed that certain aqueous solutions were not covered by PSM. These include:

  1. Ammonia, Anhydrous (CAS 7664-41-7);
  2. Dimethylamine, Anhydrous (CAS 124-40-3);
  3. Hydrogen Cyanide, Anhydrous (CAS 74-90-8);
  4. Methylamine, Anhydrous (CAS 74-89-5);
  5. Hydrochloric Acid, Anhydrous/ Hydrogen Chloride (CAS 7647-01-0);
  6. Hydrofluoric Acid, Anhydrous/ Hydrogen Fluoride (CAS 7664-39-3).

Special emphasis was placed on the case of Hydrogen Chloride and Hydrogen Fluoride. Both were listed twice under the same CAS Number and Threshold Quantity. In settling the suit, OSHA agreed that these chemical were effectively only listed once in the anhydrous (without water) form. In addition, OSHA determined that that “aqueous mixtures of hydrogen bromide (at concentrations below 63%) and mixtures of alkylaluminum (at any concentration) will fall within the partial pressure exemption under all normal handling and storage conditions.”

Otherwise, OSHA’s proposed revisions to PSM are still pending and the EPA is evaluating comments from its proposed rule. Stay tuned for more developments.