On July 28, 2011, the Louisiana Department of Environmental Quality (LDEQ) denied a petition for the adoption of a rule to regulate fossil fuel carbon dioxide (CO2) emissions and to establish an effective emissions reduction strategy that will achieve a concentration of 350 parts per million (ppm) atmospheric CO2 by the year 2100. The petition was filed on May 4, 2011, by Kezia Kamenetz, of New Orleans, and Kids vs Global Warming, a non-profit organization formed in Oak View, California.

Continue Reading Louisiana Department of Environmental Quality Declines to Regulate Carbon Dioxide Emissions

The spoliation of evidence doctrine concerns the intentional destruction of relevant evidence by a party. In the event that relevant evidence is spoiled (i.e., intentionally destroyed), the court may exercise its discretion to impose sanctions on the responsible party. The seriousness of the sanctions that a court may impose depends on the consideration of: (1) the degree of fault of the party who altered or destroyed the evidence; (2) the degree of prejudice suffered by the opposing party; and (3), whether there is a lesser sanction that will avoid substantial unfairness to the opposing party and, where the offending party is seriously at fault, will serve to deter such conduct by others in the future. Exclusion of spoiled evidence is a drastic sanction the courts generally try to avoid. However, the court may issue an instruction that will allow the jury to infer that the party spoiled the evidence because the evidence was unfavorable to the party’s case.

Continue Reading Does the Spoliation of Evidence Doctrine Apply to a Seaman who Elects to Undergo a Post-Accident Surgery Prior to an Independent Medical Examination?

In Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc, 617 F.3d 1296 (Fed. Cir. 2010), the Federal Circuit reversed a district court’s summary judgment decision that no patent infringement occurred when a US company made an offer to sell to another US company when the sale negotiations occurred outside of the US.

Transocean filed suit for infringement of patents related to an improved apparatus for conducting offshore drilling. In order to drill for oil and other offshore resources, drilling rigs must lower several components to the seabed including the drill bit, casings, BOB’s, and the drill string. A conventional offshore drilling rig utilizes a derrick with a single top drive and drawworks that can only lower one element at a time in a time consuming process. Transocean patented a specialized derrick to improve the efficiency of lowering the above components. The specialized derrick included “two stations – a main advancing station and an auxiliary advancing station that can each assemble drill strings and lower components to the seabed.” Id. at 1301. This duel-activity rig could significantly decrease the time required to complete a borehole. Id at 1302. Transocean sued Maersk rig for infringement of the specialized derrick patent.
Continue Reading Parties Cannot Avoid Patent Infringement by Conducting Negotiations Outside the United States for Products that will be Delivered and Utilized in the United States

In today’s political and economic environment, in which public resources available for infrastructure development and maintenance are increasingly scarce, Public-Private Partnerships (PPPs) offer a welcome alternative to traditional financing and operation models. A PPP is a contractual agreement between a public agency (federal, state or local) entity and a private sector entity to deliver a service or facility for public use. The Louisiana Supreme Court has recognized the public benefits of PPPs, finding that “public-private partnerships that take advantage of the special expertise of the private sector are among the most effective programs to encourage and maintain economic development, and that it is in the best interest of the State and its local governments to encourage, create, and support public-private partnerships.” See Board of Directors of Indus. Devel. Bd. of City of Gonzales, Louisiana, Inc. v. All Taxpayers, Property Owners, Citizens of City of Gonzales, 938 So.2d 11, 17 (La. 2006).

Continue Reading A Primer on Public-Private Partnerships

The Louisiana First Circuit Court of Appeals has issued the first Appellate Court decision dealing with the Louisiana New Home Warranty Act and its application to Chinese Drywall claims in the case of Jennifer L. Caminita, wife of/and Frank L. Caminita v. Regina, wife of/and Barney Core, Smith and Core, Inc., et al., State of Louisiana Court of Appeals, First Circuit, 2010 CA 1961.

The First Circuit has ruled that the periods of limitation set forth in the New Home Warranty Act provide the exclusive periods by which claims can be brought against home builders for alleged defects related to the installation of Chinese Drywall in new homes. In the Caminita case the First Circuit specifically found that the one year preemptive period provided by La.R.S. 9:3144A(1) was applicable to claims related to Chinese Drywall incorporated into new homes. Based on this finding, the court dismissed the action against the home builder.

This ruling by the Louisiana First Circuit Court of Appeals is the first Louisiana case reported at the appellate level on this issue and is in line with decisions by district courts last year which were also reported on the Kean Miller blog.

Louisiana legislators passed two new laws during the most recent Legislative Session placing additional requirements on employers to check the citizenship status of employees.

Act 376 provides for the verification of employees engaged only in public contract work by enacting La. R.S. 38:2212.10.  The new law provides that a private employer shall not bid on or contract with a public entity unless the employer attests via sworn affidavit to the use of an immigration verification system to verify that all employees in the state of Louisiana are legal citizens of the U.S. or are legal aliens.  All subcontractors are required to do the same.  Violations of the new law may result in cancellation of the public contract and ineligibility for any public contract for a period of three years or less.  If the employer complies with the verification provisions and relies on the information obtained in accordance with the verification system, the employer is protected from state law civil and criminal liabilities for: (i) hiring someone that is later found to be an unauthorized alien and (ii) refusing to hire an individual whose legal status within the verification system was that of an unauthorized alien.  The provisions of the new law apply only to contracts entered into or bids offered on or after January 1, 2012.  If the status verification system expires and is not extended by the federal government, the provisions of this new law will no longer be applicable.  Link to Act 376

Act 402 has a much broader application than Act 376, requiring verification of citizenship and authorization for employment. La. R.S. 23:995 already prohibits a person from hiring an illegal alien.  Act 402 adds new provisions to this statute that become effective August 15, 2011.  The new law provides that a person shall not be subject to certain sanctions if: (i) the E-Verify system has been used to verify the citizenship or work authorization status of every employee or (ii) the employee has provided to the employer a picture identification and at least one of the following documents: a U.S. birth certificate or certified birth card, Naturalization certificate, certificate of citizenship, alien registration card, or U.S. immigration form I-94 with employment authorized stamp.  The employer must retain copies of all documents provided by the employee.  An employer who has used the E-Verify system is presumed to have been in good faith and is not subject to any penalty for relying on the accuracy of the information contained therein.  The penalty provisions within the statute have been increased to $500 for a first violation, $1,000 for a second violation, and $2,500 for a third violation.  The penalty provisions are applicable to each alien employed in violation of the law.  There is an exemption for health care facilities/entities licensed by DHH under the statutory provisions relating to second and third violations.  Link to Act 402

Does an insurer waive its policy defenses when it breaches its duty to defend?  In Arceneaux v. Amstar Corp., 211 WL 2591701 (La. July, 2011), the insurer breached its duty to defend by issuing a denial of coverage and withdrawing from the insured’s defense.  The insurer’s action was based on the mistaken belief that its policies contained an exclusionary provision when, in fact, the exclusion was no longer effective.  According to the trial court, breaching the duty to defend resulted in a waiver of the coverage defenses.  The Louisiana Supreme Court concluded to the contrary, differentiating between a breach and a waiver.  Waiver is an intentional relinquishment of a known right or power, and occurs when an insurer with knowledge of the facts indicating non-coverage assumes or continues the defense without obtaining a non-waiver agreement to reserve its coverage defenses.  Under those circumstances, the insured is led to believe that the insurer has given up that right and the insured has the right to believe that the insured’s counsel is acting in the insured’s best interest without regard to coverage defenses.  An insurer cannot avoid liability based on a coverage defense if it has defended the insured without a reservation of rights.  To the contrary, a breach of the duty to defend is not a waiver and does not mislead the insured into believing there could be coverage because there is no expressed intent to release its right to deny coverage.  Under such circumstances, waiver principles do not apply.  Consequently, a breach of the duty to defend is not a waiver of policy defenses.

Recently, Louisiana businesses have received solicitation by mail from a private company regarding services related to the maintenance of corporate meeting minutes.  An “Annual Meeting Disclosure Statement,” provided as part of the solicitation, cites certain provisions of La. R.S. 12:223 which requires every corporation to keep certain records, including records of the meetings of its members and directors, at its registered office.  The solicitation goes on to declare that “Not satisfying the minimum annual filing requirements in a timely manner causes your company to be in ‘bad standing’ with the state.”  Finally, services are offered with the statement, “We assist corporations to avoid potential non-compliance with the above provision of maintaining Annual Meeting Minutes.”

Although it is unclear what services are actually being offered in the solicitation described above, Louisiana business owners should be aware of the following:

  1. Louisiana law does not require corporate minutes of director or shareholder meetings to be filed with the state; and
  2. The corporate records described in La. R.S. 12:223 are required to be kept at the corporation’s registered office.

You should consult your attorney for assistance in determining any and all legal requirements regarding a corporation, limited liability company, partnership, or any other legal entity.

The recent development of the Haynesville Shale in North Louisiana and other shale formations around the country has generated huge public interest in the hydraulic fracturing process, which is known as “fracking” in the oil and gas industry. Fracking refers to the procedure of injecting fluid into tight shale or sandstone formations to create fractures in the rock, through which oil and gas flow into the wellbore. When combined with horizontal drilling, fracking allows producers to capture oil and gas reserves that were once thought to be out-of-reach.

Last week, the Louisiana Department of Natural Resources (LDNR) filed a Notice of Intent to amend LAC 43:XIX Subpart I (Statewide Order No. 29-B). The proposal seeks to amend Statewide Order 29-B to include new reporting regulations for fracking operations in Louisiana. If the proposed regulation is promulgated, it would require any operator engaged in fracking to regularly report:

  1. The types and volumes of base fluid used during fracking;
  2. A detailed list of all additives used in the fluid and the name of the supplier for each type of additive; and
  3. A list and concentration of any chemicals contained in the fracking fluid that are regulated by the Occupational Safety and Health Administration (OSHA) and reported on Materials Safety Data Sheets (MSDS).

If, however, the identity of any reportable chemical or additive is a “trade secret,” the operator may refuse to report proprietary details but must still report pertinent chemical characteristics of the product. The proposed regulation would only apply to new wells that are drilled after the date that a final regulation is promulgated.

The Notice of Intent is merely the first step in promulgating the new reporting requirements for fracking in Louisiana. This proposed regulation was initiated based on recommendations from the State Review of Oil and Natural Gas Environmental Regulations (STRONGER), (1) which champions itself as a “successful alternative to federal oversight of state oil and gas exploration and production waste regulatory programs.” (2)  With this proposal, Louisiana joins a growing list of states including Arkansas (3), Michigan (4), Montana (5) , Texas (6) , and Wyoming (7) that are discussing or have passed state regulations requiring disclosure or reporting of the contents of hydraulic fracturing fluids. A public hearing regarding the proposed Louisiana regulations will occur on August 30, 2011 in Baton Rouge.

To view the full Notice of Intent, visit the LDNR’s website.

 (1)  See Louisiana Department of Natural Resources, Notice of Intent: Hydraulic Fracturing Stimulation Operations (LAC 43:XIX.118) (“a review of the Office of Conservation policies and regulations associated with the hydraulic fracturing process was conducted by the non-profit, multi-stakeholder organization, STRONGER, Inc. to assess the effectiveness and adequacy of current regulations. Their report finalized March 2011, recommended some of the changes included in the proposed amendment.”).

(2)  STRONGER, Inc. website, “The History and Accomplishments of the State Review Process,” available at: http://www.strongerinc.org/documents/STRONGER%20State%20Review%20Process%203-4-2011.pdf.

(3)  See Arkansas Oil & Gas Commission, Rule B-19, available at: http://www.aogc.state.ar.us/PDF/B-19%20Final%201-15-11.pdf.

(4)  See Michigan Department of Environmental Quality, Supervisor of Wells Instruction 1-2011(Reporting Instructions), available at: http://www.michigan.gov/documents/deq/SI_1-2011_353936_7.pdf.

(5)  See Department of Natural Resources and Conservation of the State of Montana website, available at: http://bogc.dnrc.mt.gov/PDF/36-22-157pro-arm.pdf.

(6)  See Texas House Bill 3328 (effective 9/1/11), http://www.legis.state.tx.us/BillLookup/Text.aspx?LegSess=82R&Bill=HB3328; http://www.legis.state.tx.us/BillLookup/history.aspx?LegSess=82R&Bill=HB3328.

(7)  See Wyoming Oil & Gas Conservation Commission Rules (Chap. 4, Sect. 10), http://soswy.state.wy.us/Rules/RULES/7929.pdf.

Since 2003, Louisiana, through the Department of Health and Hospitals (“DHH”) and the Medicaid Program, administers home and community-based health services (“HCBS”) available to disabled citizens. The HCBS includes several programs, one of which is the Long Term Personal Care Services (“LT-PCS”) program. The LT-PCS program provides disabled citizens with a personal care worker to assist with performing personal care or household chores that the disabled citizen would otherwise be unable to perform, in order to avoid being institutionalized. Individuals who do not qualify for LT-PCS or who seek additional or alternative services may enter one of Louisiana’s waiver programs: Elderly and Disabled Adults, Adult Day Health Care, Program of All-inclusive Care for the Elderly, or Money Follows the Person for individuals transitioning from nursing facilities. However, these programs have limited slots, geographical or age limits, and long waiting lists. An individual may be moved to the top of the priority list and immediately obtain a waiver, if the individual has had a hospital stay in excess of 30 days or has been treated in a nursing facility for 120 consecutive days.

Continue Reading Court Certifies Class Action and Finds Reduction in Medicaid LT-PCS Program Violates Americans with Disabilities Act