On July 15, 2011, the House of Representative, Committee on Energy and Power, Subcommittee on Energy and Commerce held hearings on a draft of the “Pipeline Infrastructure and Community Protection Act of 2011.”  Chairman Fred Upton’s initial comments focused on recent pipeline incidents: the 20,000 barrel oil spill into Talmadge Creek, Michigan in the summer of 2010, the September 2010 gas pipeline explosion that killed 8 people in San Bruno, California and the most recent spill of 1,000 barrels of oil near Billings, Montana. (1)  Chairman Upton concluded that these incidents indicate that pipeline laws must be strengthened. Included within the draft legislation are the following provisions:

  • one-hour time limit to report incidents;
  • use of automatic or remote control shutoff-valves;
  • better leak detection technology;
  • substantial increase in civil penalties for releases from pipeline;
  • enhanced inspection techniques; more miles of pipeline inspected; and
  • increased number of pipeline inspectors.

Cynthia Quarterman, Administrator of the Pipeline and Hazardous Materials Safety Administration (“PHMSA”), within the Department of Transportation, appeared and offered general support for the bill. However she offered specific recommendations to various provisions to strengthen the legislation. Among the recommendations were: (2)

  • higher administrative penalties should apply in High Consequence Areas;
  • eliminate statutory exemption for gathering lines; and
  • clarity should be added that shut-off valve requirements apply to gas and hazardous pipelines.

Because changes in regulatory programs often occur quickly after incidents such as these recent three pipeline events, interested parties should be aware of the above issues and recommendations. Owners and operators of regulated pipelines should expect more inspection/detection requirements and the likelihood of enhanced PHSMA and state agency inspections and enforcement actions.
(1)   Opening Statement of Chairman Fred Upton (July 15, 2011), found at http://republicans.energycommerce.house.gov/Media/file/Hearings/Energy/071511/Upton%20.pdf (last visited July 18, 2011).

(2)  Written Statement of Cynthia Quarterman, Administrator, PHMSA (July 15, 2011) found at http://www.phmsa.dot.gov/staticfiles/PHMSA/DownloadableFiles/Testimony/House%20Energy%20and%20Commerce%20Written%20Testimony%20-%20July%2015%202011%20-%20For%20Web%20_2_.pdf (last visited July 18, 2011).

Act 337 of the Regular Session of the 2011 Louisiana Legislature enacted an amendment to Louisiana R.S. 37:1285(A) to add new subsection (A)(32), which provides an additional ground for physicians to be disciplined by the Louisiana State Board of Medical Examiners (the “LSBME”). The new ground relates to a physician holding herself/himself out to the public as being certified by a public or private board or using the phrase “board certified”. In order for a physician to use the phrase “board certified” with the public, all of the following criteria must be met:

(a) The full name of the board from which the physician received certification and the name of the specialty or subspecialty is included in the advertisement;

(b) The board that provides the certification meets any of the following qualifications:

(i) It is a member board of the American Board of Medical Specialties or an American Osteopathic Association certifying board;

(ii) The board has been approved by the LSBME;

(iii) The board requires an Accreditation Council for Graduate Medical Education or American Osteopathic Association approved postgraduate training program that provides complete training in that specialty or subspecialty.

(c) If the physician advertises and does not meet the criteria articulated above, the physician must list his or her qualifications for performing the advertised medical procedure or procedures.

The bill was signed by Governor Jindal on June 29, 2011. It will become effective August 15, 2011.

Complying with this new enactment is important, because failure to do so provides grounds for discipline of a physician, which may include refusal to issue, suspension, revocation, or other disciplinary action against the license of a physician by the LSBME.

On June 21, 2011, a Federal Grand Jury in Virginia filed an indictment against a physician for criminal violations of the Health Insurance Portability and Accountability Act (“HIPAA”). The indictment alleges three (3) counts of unauthorized disclosure of a patient’s individually identifiable health information to an agent of the patient’s employer. The indictment alleges that the physician provided the patient in-patient mental health treatment at a psychiatric care center in August and September 2007.

Each count charges that in February 2008, the physician knowingly and in violation of HIPAA disclosed the patient’s protected health information under the false pretense that the disclosure was necessary because the patient was a serious and imminent threat to the safety of the public, when the physician, in fact, knew the patient was not a serious and imminent threat to the public.

Because the alleged disclosures were made under “false pretenses,” if found guilty, the physician could face a fine of not more than $100,000.00 or imprisonment of not more than five (5) years, or both per violation.

As of July 3, 2011, the air quality measured at the official ozone monitor at 1425 Airport Drive, which is within Shreveport, but located in Bossier Parish, indicated that the design value for the parish is now 76.7 parts per billion (ppb) which exceeds the 75 ppb standard set by EPA in 2008. 40 C.F.R. §50.15. The design value for each monitor is the 3 year average of the 4th highest ozone reading at that monitor each year. The exceedance of the current standard will likely cause the Louisiana Department of Environmental Quality (LDEQ) to propose that EPA designate Bossier Parish, and perhaps Caddo and DeSoto Parishes, as an ozone nonattainment area.

LDEQ was required to submit its recommendation for nonattainment designations under the 2008 ozone standard by March 12, 2009. EPA was then required to act on the proposals and make final designations no later than March 12, 2010. 73 Fed. Reg. 16436, 16503 (Mar. 27, 2008). In its 2009 recommendation, LDEQ did designate Caddo, but not Bossier or DeSoto, parishes as nonattainment. (1) However, when air quality in Caddo parish improved to compliance status over the past several years, LDEQ amended that recommendation in January 2010 to classify Caddo as attainment. (2)

Continue Reading Shreveport-Bossier Area Exceeds Current Ozone National Ambient Air Quality Standard – Triggers Potential Consequences for Air Emission Sources

In response to the Gulf of Mexico Deepwater Horizon Incident, the Louisiana Department of Natural Resources (“DNR”), Office of Conservation (“Conservation”) issued a series of emergency rules with effective dates: July 15, 2010(1) , December 9, 2010(2), January 12, 2011(3) and most recently May 12, 2011(4).  . The initial emergency rule created:

“a new Chapter within Statewide Order No. 29-B (LAC 43:XIX.Ch. 2) to provide additional rules concerning the drilling and completion of oil and gas wells at water locations, specifically providing for the following: rig movements and reporting requirements, additional requirements for applications to drill, casing-header requirements, mandatory diverter systems and blowout preventer requirements, oil and gas workover operations, diesel engine safety requirements, and drilling fluid regulations.” See, 36 La. Reg. 1427.

The initial emergency rule also amended Statewide Order No. 29-B-a (LAC 43:XIX. Ch. 11) “to provide for and expand upon rules concerning the use of storm chokes in oil and gas wells at water locations.” Id.

In the emergency rules, Conservation has reviewed and incorporated “all provisions of the MMS [Minerals Management Service] regulations concerning well control issues at water locations” that were not repetitive, duplicative or otherwise inapplicable to the situations encountered in Louisiana waters. See, 37 La. Reg. 1548. In addition to providing Conservation more time promulgate final comprehensive rules, the most recent version of the emergency rules contains a few noteworthy changes from the January 2011 version of the rule. These are:

  • The Oil and Gas Well-Workover Operations section, located at LAC 43:XIX.211, contains specific requirements for blow out preventer components and configuration. Conservation removed a provision (formally located at LAC 43:XIX.213.L) allowing the Commissioner to grant an exemption from specific equipment requirements mandated by that section. The January 2011 version of the rule allowed an exemption from specific equipment requirements where the operator could demonstrate the unavailability of the mandated equipment and that anticipated surface pressures minimize the opportunity for loss of well control.
  • Conservation changed the mandatory industry standard for design and operation of subsurface safety valves (“SSSV”) from “API RP 14B” to “API RP 14H”. See, LAC 43:XIX.1104.E (making the emergency rule consistent with 30 C.F.R. §250.804(a)(5)).
  • All four versions of the emergency rule require that installed subsurface-controlled SSSV’s be removed and tested every twelve or six months, depending on whether they were installed on a landing nipple or not. However, the most recent emergency rule also included a requirement that all SSSVs be inspected for leakage every month to six weeks. See, LAC 43:XIX.1104.E.2.a.

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(1)  36 Louisiana Register 1427, July 20, 2010, available at: http://www.doa.louisiana.gov/osr/reg/1007/1007.pdf
(last visited June 27, 2011).

(2)  36 Louisiana Register 2823, Dec. 20, 2010, available at: http://www.doa.louisiana.gov/osr/reg/1012/1012.pdf
(last visited June 27, 2011).

(3)  37 Louisiana Register 460, Feb. 20, 2011, available at: http://www.doa.louisiana.gov/osr/reg/1102/1102.pdf
(last visited June 27, 2011).

(4)  37 Louisiana Register 1547, June 20, 2011, available at: http://www.doa.louisiana.gov/osr/reg/1106/1106.pdf (last visited June 27, 2011).

Deepwater oil and gas production from the Gulf of Mexico has become a significant portion of the current production within the United States, equal to over 1.6 million barrels per day of oil equivalent; total U.S oil production is around 5.3 million barrels per day. (1)  Worldwide shallow water oil production peaked around the year 2000 whereas worldwide deep water production has risen to around 5 million barrels per day. On May 10, 2011, the Bureau of Ocean Energy Management, Regulation and Enforcement (“BOEMRE”) approved Royal Dutch Shell’s Exploration Plan S-0744 to better define discoveries announced in 2009 and 2010. (2) 

Several environmental groups filed suit in an attempt to block the approved plan. Gulf Restoration Network, Inc., Florida Wildlife Federation, and Sierra Club Inc. filed a petition on June 8, 2011, in the United States Court of Appeals, 11th Circuit, in an attempt to set aside BOEMRE’s approval of the plan. The allegations in the petition are relatively general, alleging violation of the National Environmental Policy Act (“NEPA”) (i.e., for BOEMRE’s alleged failure to appropriately conduct the required environmental assessments and/or impact statements) and further alleging elements required pursuant to 43 U.S.C §1349(c) necessary to maintain the suit under the Outer Continental Shelf Lands Act (“OCSLA”).
Continue Reading Environmental Groups Attempt to Block Shell Deepwater Gulf of Mexico Drilling

On June 1, 2011, the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) issued a notice to Gulf of Mexico Outer Continental Shelf Region (GOMR) lease and pipeline right-of-way (ROW) holders on reporting hurricane and tropical storm effects. Specifically, the recent notice, designated NTL No. 2011-G01(1), requires four reports, as appropriate:

  • Evacuation and Production curtailment statistic report – partially evacuated platforms are not considered evacuated
  • Facility shut-in reports – including facilities that are partially shut-in
  • Facility damage reports – including platforms, rigs and pipelines
  • Pollution reports – facility discharged or continues to discharge oil during or as a result of the event

The Evacuation and Production curtailment statistic report and the Facility shut-in report overlap in subject matter. They differ in that the first report is general and requires overall company statistics (number of facilities evacuated or not evacuated, overall production shut-in); the second report is specific, requiring statistics platform by platform. Facility damage reports are to be submitted as soon as the information becomes available. Other reports are to be submitted daily as long as the condition exists. Reports may be submitted by e-mail or through the BOEMRE GOMR internet-based Permitting and Reporting System (eWell). Although the notice outlines the specific information and instructions required when the transmission is by e-mail, BOEMRE GOMR strongly encourages use of eWell to transmit the required data.

The eWell system, described in NTL No. 2007-G15 (2), was developed to increase efficiency of well permitting and reporting transactions between OCS lessees and operators and the GOMR by both reducing the time (and cost) required to process data and to reduce input errors. The system is designed to simplify submittal of multiple reports and subsequent daily reports. Interested lessees and operators and pipeline ROW holders must apply to BOEMRE GOMR for access to the eWell system.

[1] BOEMRE, Hurricane and Tropical Storm Effects Reports, NTL No. 2011-G01, http://www.gomr.boemre.gov/homepg/regulate/regs/ntls/2011NTLs/11-G01.pdf (last visited June 10, 2011).

[2] BOERME, eWell Permitting and Reporting System, NTL- No. 2007-G15, http://www.gomr.boemre.gov/homepg/regulate/regs/ntls/2007NTLs/07-g15.pdf (last visited June 10, 2011).

 

 

In the United States, patent owners or licensees are required to inform alleged infringers of their possibly infringing behavior prior to being able to recover damages for the infringement of a valid U.S. patent. (1)  Marking a product with the applicable patent number provides the requisite notice. (2)  However, failure to monitor products marked with a patent number can have dire consequences.

35 U.S.C § 292 prohibits the marking of an unpatented article as being “patented.” § 292 states that “[w]hoever marks upon, or affixes to, or uses in advertising in connection with any unpatented article, the word “patent” or any word or number importing that the same is patented for the purpose of deceiving the public… [s]hall be fined not more than $500 for every such offense.” (3)

Currently, any person may bring a lawsuit for a violation of 35 U.S.C. § 292 and get half of any fines levied against the entity responsible for the false marking. (4)  The other half of the fine goes to the United States government. (5)

While § 292 only provides for a civil monetary fine, the fine is up to $500 per offense. The Court of Appeals for the Federal Circuit, the court which hears appeals in all patent cases, held that an “offense” under the statute is each separate item that bears the false patent label. (6)  Accordingly, the damages could easily climb into the millions of dollars.

However, to be fined under § 292, there must be a showing that there was an “intent to deceive the public.” (7)  The Court of Appeals for the Federal Circuit held that there is no intent to deceive the public when there was a “reasonable belief that the articles were properly marked.” (8) 

Recently, the United States District Court for the Northern District of Ohio found that 35 U.S.C. §292 was unconstitutional. (9)  However, the Court of Appeals for the Federal Circuit has yet to determine the constitutionality issue. Additionally, the America Invents Act passed by the Senate would limit a cause of action under 35 U.S.C. §292 to the United States government or to an entity suffering a competitive injury as a result of the alleged false marking. (10)  The America Invents Act merely narrows the potential pool of plaintiffs and does not alter the amount of damages available.

Therefore, under the Court of Appeals for the Federal Circuit’s interpretation of the statute, it is important to have a plan in place to monitor patent marking and to ensure that the plan is actually implemented.  Additionally, the Court of Appeals for the Federal Circuit has held that obtaining the opinion of outside counsel with regards to the formation of a monitoring plan and to ensure that the items marked are covered by the applicable patents are facts which may tend to show that a business did not intend to deceive the public. (11)

To reduce the risk of violating the false marking patent law, businesses which own or license patents should consider obtaining the opinion of a competent patent attorney to assist in developing a plan to monitor patent marking and to determine if products and processes which are currently being marked with patent numbers are indeed covered under the listed patents.

(1)  35 U.S.C. § 287(a).
(2)  Id.
(3)  35 U.S.C. § 292(a).
(4)  35 U.S.C. § 292(b).
(5)  35 U.S.C. § 292(b).
(6)  Forest Group v. Bon Tool, 590 F.3d 1295, 1304 (Fed.Cir.2009).
(7)  Clontech Labs. Inc. v. Invitrogen Corp., 406 F.3d 1347, 1352 (Fed.Cir.2005).
(8)  Id., at 1353.
(9)  See Unique Product Solutions, Ltd. v. Hy-Grade Valve, Inc., 2011 WL 924341 (N.D.Ohio 2011).
(10)  S. 23, 112th Cong. (as passed by Senate, March 8, 2011).
(11) Pequignot v. Solo Cup, 608 F.3d 1356, 1364 (Fed.Cir. 2010)

In Oliver v. Magnolia Clinic, 2010-2785 (La. 3/25/11), 57 So. 3d 308, the Louisiana Supreme Court vacated a Third Circuit ruling that nurse practitioners were not covered by the Louisiana Medical Malpractice Act and did not benefit from the cap on damages. The Supreme Court remanded the case to the Third Circuit for an en banc consideration in order to obtain a majority opinion on the issues presented.

Upon original hearing, two judges of a five judge panel of the Third Circuit ruled the Medical Malpractice Act’s inclusion of nurse practitioners within its ambit violated the equal protection guarantees of the Louisiana Constitution and La. R. S. 40:1299.41(A)(1) and was, therefore, unconstitutional. Two judges on the panel ruled that the inclusion of nurse practitioners as health care providers entitled to the protection of the Medical Malpractice Act did not go into effect until the amendment of the statute in 2009. Because the alleged malpractice of the nurse practitioner occurred in 2000-2001, the statute did not cover the defendant nurse practitioner, and she was not entitled to a cap on the damages awarded at trial.
Continue Reading Unsettled Question of Medical Malpractice Act Coverage For Nurse Practitioners in Louisiana

A recent opinion from the United States Bankruptcy Court in Baton Rouge, Louisiana shows that even experienced lenders and developers may not always understand how Louisiana’s Private Works Act applies to their project, and how much leverage a properly filed notice of contract can provide to a general contractor.  Tuscany Reserve, LLC (“LLC”) was formed by sophisticated developers for the purpose of developing a new apartment complex in Baton Rouge. LLC obtained acquisition and construction financing from a bank (1st Bank), which properly recorded its mortgage on the project before work commenced. LLC hired “Contractor” to build the complex; Contractor recorded its notice of contract in the parish mortgage records.  As often happens, a dispute developed between LLC and Contractor regarding the work performed and lack of payment.  Contractor stopped work and filed a lien on the property under the Louisiana Private Works Act for $1.17 million.  Contractor eventually agreed to cancel its lien in exchange for a promissory note and guarantees from LLC’s principals and collateral provided by an LLC affiliate.  Once the lien was cancelled, 1st Bank funded two draw requests on the construction loan.  LLC needed more money for the project and turned to a new lender (2nd Bank) for additional financing.   2nd Bank secured its loan with a collateral mortgage on the immovable property for the project; there were no liens in the property records when 2nd Bank recorded its mortgage.  The relationship between LLC and Contractor soon soured, again, and Contractor filed two liens on the project, one for the original claim amount, plus interest, and another for $250,000.00.  Contractor sued LLC and its principals on the matured promissory note, and also sued LLC based on its rights under the recorded construction contract and the Louisiana Private Works Act. LLC eventually filed for chapter 11 bankruptcy in the Middle District of Louisiana.

Continue Reading Lenders and Developers Need to Understand How Louisiana’s Private Works Act Applies to Their Projects