Category: Insurance and Risk Management

Ebola Guidance

It seems that everyone is in an Ebola panic.  We’re all secretly worried a pandemic will mark the beginning of the end of life as we know it.  Personally, I think that most of us has just viewed one too many movies or TV shows about post-epidemic walking dead and other such horrors.  But I don’t mean to diminish the worries which keep many people up at night.

With one travel-related case of Ebola in the U.S., and two resulting confirmed transmissions, the reality of how small our world is — and how vulnerable we are within it — is striking fear in the most stalwart of managers.  Is there something you should be doing for your own safety?  Is there something which you are obligated to do at the office?

Duane Morris has issued  an Alert on the topic entitled “Guidance for Employers Regarding Ebola.” It provides one of the first analyses of possible risks and responsibilities for employers.  Their guidance examines risks and responsibilities under ADA, OSHA, NLRA, FMLA, and Title VII.

Remember, according to the CDC,  the Ebola virus can be spread in several ways to others. Specifically, Ebola is spread through direct contact with blood or body fluids of a person who is sick with Ebola, objects that have been contaminated with the virus and infected animals. The CDC states that Ebola is not spread through the air or by water or, in general, by food.  So let’s not panic.  Being well informed, and prepared, is always the best option.

The Latest Fraudulent Bank Check Scam

You are probably wondering why the scam artists keep coming up with new ways to try to rip you off.  It’s because they are well paid to do it by uninformed people who take their bait, including attorneys throughout the U.S.  Here’s the latest:

Sir/Ma

We are a Chinese Company based in the Hong Kong involved in the production and exportation of semi Finished steel products such as, Low alloy vessels, Carbon plates, Ship Building plates and Plates for boiler/Vessel to Canada and USA.

We are looking to expand our business network in these countries but presently we are having problems receiving payment for already supplied goods because most payment comes in our Customer’s local Canadian Cheques/Drafts. And it takes too long to clear the payments in the Hong Kong.

We are looking to hire the services of any individual/ legal Company that resides in the Country  as a payment receiving agent for our customers .

You will be required to receive the payments from our customers in your Country in the form of Cashers Checks , bank draft  and cash delivery , you will in turn send the payment to us. You are entitled to 15% Commission of every payment you receive.

You will be receiving at least 4-5 payments monthly. If you are interested in being our Payment receiving agent, please get back to us
with the following information.

Full Names:
Full Contact Address:
Age: (25yrs and Above)
Tel #:
Fax #:
Occupation:

Apply immediately to the Human Resource manager via email:

Sharon Kadiri
Owen Machinery., LTD.,

6/F,Trade Service Center  ,388 Kwun Road

Kowloon, Hong Kong

These scam artists are so good, they create web sites for their phony companies, and may even have a “live” telephone which is answered by a no-gooder.  Beware anything that asks you to accept certified cashier’s checks, and then wire money out of the country.  Your “cut” is usually too good to be true, because it isn’t true at all!

Windows Security Patches Released

Microsoft Released a security patch on Thursday, May 1st, which fixed all Windows versions of Internet Explorer, including for Windows XP!

XP has been out of support, but with a heavy installed base — estimated at 30% of the world’s computers by some — Microsoft made an exception to its policy by updating the operating system.  At a lot of law firms, there was a visible sigh of relief.  Kudos to Microsoft for doing the right thing.

Personally, I took the opportunity to change my default browser to Chrome, and I don’t regret it.  There are a few software packages I have which are not compatible.  For example, Copernic Desktop Search.  But I only use that for searches internal to my system, so I don’t really care.

In case you’re curious, data from NetMarketShare.com indicates that Windows 7 powers 49.27% of the world’s computers, while Windows 8.0 and 8.1 combined account for only 12.24%.   MAC versions 10.6 through 10.8 combined holds 3.25% of market share.   That number surprises me, as I’m seeing strong growth in the legal industry.

Computer Security Issues – Windows XP, Adobe Flash, Internet Explorer

When Homeland Security issues a warning about new risks of using your computer, you should stop and pay attention.  When mighty Microsoft tells you to temporarily stop using one of their programs due to a security issue, you should stop and pay attention once you’ve recovered from fainting.

Yes folks, our computing environment has just gotten a whole lot riskier, especially when exploring the internet.

First, let me advise you that the issues have not yet been resolved, despite reports issued based on misinformation and misunderstanding.  That’s because we’re dealing with multiple issues, on multiple software platforms.

The issue dealing with Adobe Flash Player was resolved (hopefully) by a security update from Adobe on Monday, April 28.  That problem involved a Flash bug that was attacking computer visitors of a Syrian government web site.  Although that bug was significant, it is not at all related to the major boo-boo in Internet Explorer.  And it’s doubtful it would have impacted too many of you in the legal environment.

The “big” Microsoft bug, which Microsoft is currently scrambling to address with a patch, affects versions 6 to 11 of Internet Explorer.  It potentially gives data thieves the same access to a network computer as a legitimate user.  Microsoft has acknowledged that there have been “limited, targeted attacks that attempt to exploit a vulnerability.”  Excuse me?  It can’t be so limited if Homeland Security is involved, along with every major media outlet.

The security flaw in Internet Explorer comes into play if you click on a bad link.  Not the type which gives you an innocent “404, Not Found” but rather the kind which takes you to a fake web site, where malicious code can be injected into your computer.  Some of these sites are so realistically designed, you have no clue they’re fake and “bad”.

This is the first major security flaw discovered since Windows XP support was discontinued.  That means that when the security patch is issued, both Internet Explorer and Windows 8.0+ will be updated.  Windows XP will remain vulnerable.

What should you do?

  1. Stop using Internet Explorer for now.  Use one of the competitors like Google Chrome or Firefox.
  2. Don’t click on links found on web sites which go outside that site.  Rather, use your “favorites” to get to the other site, or look up the other site and go there directly.  It’s estimated that as much as 40% of legitimate web sites may unknowingly have malicious code on their site.  One example would be replacing a legitimate link with one which misdirects you to a “bad” web site.
  3. Make sure you’re installing all security updates which arrive at your computer.
  4. Be sure your anti-virus and anti-spyware software is kept up to date, and is running continuously in the background.
  5. Make sure your firewall is up to date.
  6. If you’re still using Windows XP, make a permanent change to your internet browser choice.  Also, whichever browser you choose, you may want to have your security software checking each site before it actually allows you to land on it.  It will slow your travels, but keep you much safer.

Keep in mind that you will have to get off of Windows XP in short order.  Hey, I don’t like it one bit either!  But keep in mind that law firms must take due diligence in safeguarding client confidentiality.  Knowingly using software which will never receive additional security updates is much like putting your most confidential client documents in a trash bag, and throwing it off the Empire State Building.  It’s not a question as to whether those papers will be scattered on impact, but rather how far they’ll be scattered!

Security Issues on iPhone 5s

Attorneys who use the iPhone 5s should refrain from enabling Touch ID.  There have already been two patches in response to two security flaws.  But tech experts feel that the Touch ID feature is still a risk for phones carrying confidential client information.  Michael Pham of Winstead Attorneys has some insights in a post on the WinTech blog.  He suggests that employers implement strict written policies and  procedures that require employees to keep their mobile devices current with the latest  software updates concerning security, and that they notify the company the  minute a phone goes missing.  Wise advice.  I also recommend that remote swipe be enabled before any client information is synched to the phone.

It’s important for firms to take proactive steps to protect confidential client data.  Failure to take reasonable precautions could spell malpractice.

How One Keystroke Can Undo Your Deal — Confidentiality:

What does a teenager have in common with confidentiality?  Absolutely nothing.  Today’s youth live out their lives on social media without a thought of consequences from sharing every thought and action.  Following is a guest blog by Wayne, PA employment lawyer Robin Bond.  Read about how a college-age daughter’s Facebook post cost her father $80,000. These are your
employees and clients, folks.  Make sure they understand the meaning of the term “confidential.”

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When a company and an employee sign off on a deal or settlement agreement, “confidentiality” about the terms of that agreement is often a key condition for payment. That means “keeping quiet” — and keeping your social media fingers, and those of your children, off the keys!

In Gulliver Schools, Inc. v. Snay, Patrick Snay’s lawyers negotiated a settlement of his age discrimination and retaliation claims; however, confidentiality was a key term for payment of $80,000.  Snay told his college-age daughter that the case “was settled” and that he was “happy with the result.” Snay’s daughter did what many of her age would do: she immediately went to her Facebook page and posted the following message: “Mama and Papa Snay won their case against Gulliver. Gulliver is now officially paying for my vacation to Europe this summer. SUCK IT.”

Snay’s daughter — a Gulliver alum — had approximately 1200 Facebook friends, and many of these were current or former Gulliver students as well – the exact population Gulliver did not want to know about the settlement. The school withheld the payment to Snay and the Court sided with the school, on the basis that the daughter’s social media posting violated her father’s duty of confidentiality under the settlement agreement.

Children Responsible for Parental Debt

I never heard of the “filial responsibility” laws.  Until I read about a PA resident who must pay for Mom’s $93,000 Nursing Home bill.  Now that I’ve read about it, I’m sure glad my sister has the “deep pocket” in our family.

I thought my first post when I returned from TechShow would be about one of the many wonderful lessons learned.  I was in fact going to post diligently from there.  But the Chicago Hilton has about the worst Wi-Fi access I’ve encountered.  It was tough just getting a cell phone signal.  It was fairly humorous to see so many lawyers with cell phones to their ears and bodies literally plastered to the windows like some sort of human antennae.  At night, when I got back to the room after the myriad of social events, I was just too tired to think, let alone write.

Now that I’m back I’m anxious to share, but an article in the Anderson Elder Law Newsletter entitled “Son Liable for Mom’s $93,000 Nursing Home Bill Under ‘Filial Responsibility’ Law” really caught my attention.  How could that be?  Well, it be!  And I am so shocked by this, I feel compelled to share it right now.  The article explains:

Some 29 states currently have laws making adult children responsible for their parents if their parents can’t afford to take care of themselves. These “filial responsibility” laws have rarely been enforced, but six years ago when federal rules made it more difficult to qualify for Medicaid long-term care coverage, some elder law attorneys predicted that nursing homes would start using the laws as a way to get care paid for.

And it was precisely the application of this law which caused the son to be forced to take financial responsibility.  Unbelievably, the law does not require it to consider other sources of income or to wait until a parent’s Medicaid claim is resolved.  Even more pernicious is that the law permits the nursing home to choose which family members to pursue for the money owed.  In this particular case, they ignored a spouse and other siblings, and went after the apparent “deep pocket.”

Linda Anderson notes that after Pennsylvania re-enacted its filial support law in the mid-2000s, Williamsport attorney Jeffrey A. Marshall forecast that the new Medicaid law would trigger a wave of lawsuits involving adult children.  Obviously, he was correct, and this is just the beginning of what may become a tidal wave of lawsuits.  In Marshall’s blog post about this court decision he writes:

Children are often surprised to learn that they can be held responsible for their parent’s unpaid medical and care related expenses. It just doesn’t seem fair. But, whether fair or not, the Pittas case shows that the child’s support obligation to the parent is the law in Pennsylvania.  Children: be warned. If your parent needs long term care and may someday be unable to pay for it, you should find out about your potential financial liability and what to do about it.

So what is the son supposed to do, now that he has lost his appeal?  Is he to sue his father and siblings for their “fair share” of the debt?  Declare bankruptcy?  I’m just thinking out loud on this, while I shake my head in disbelief.  Our lives are already so stressful . . . raising children in a two-income household, trying to care for aging parents, trying to save for retirement in an ever-increasing financially hostile future environment, and to have some quality of life and semblance of balance in the current moment.  Is this the straw which breaks the back of American families?

I am so grateful I “strongly encouraged” my mom to purchase optional Long Term Care Insurance through her employer’s Cafeteria Plan some 30 years ago, so that it’s there if she needs it.   We found out from personal experience about 2 years ago how quickly the bills can mount after my mother suffered a fall at home.  The nursing home costs, followed by rehab at home, and then extended personal care until she was recovered enough to be completely on her own again, added up to a huge amount of money which her Medicare and additional excess policy didn’t cover.   They paid plenty, don’t get me wrong.  But there was a lot of uncovered additional expense, especially the personal in-home care, which cost a fortune.  At least the Long Term Care contributed toward some of that once the elimination period was passed.  (Although I admit I had to really duke it out with them to get her benefit paid, despite her making premium payments like clockwork for 30 years.  But hey, don’t even get me started on the topic of insurance companies!  :-(  )

If you have living parents, this is not something you can afford to ignore.  Make sure they have adequate insurance coverage, and talk to an Elder Care attorney just to see what risks you face, and how you might avoid them.  The investment to protect yourself now is a pittance compared to the potential exposure later.

 

Why PA Needs CLE Credit for Practice Management Education

I have been asserting that PA should provide full CLE credit for practice management education since I joined the PA Bar Association in 1999.  Here’s just a bit more proof of why.  Take a look at this recent blog post by highly-respected marketing consultant Dustin Cole, entitled “Of the Top 10 Causes of Malpractice & Grievances — 8 Are Sloppy Housekeeping!”  From his post, here are the top 8 of 10 reasons for malpractice / grievance claims in Florida:

1. Failure to manage time/procrastination
2. Failure to docket – identify/document deadlines
3. Failure to manage information
4. Failure to obtain client consent
5. Failure to file documents timely
6. Missed or unresolved Conflict of Interest
7. Poor communications with client
8. Failure to follow client instructions

Any of this look familiar?  Yep, if you look at the top causes of claims in PA, you will see the same causes, perhaps labeled slightly differently, or in different order.  The truth is that most attorneys and law firms get themselves in trouble because of poor business practices, including disorganization, lack of follow-up, absence of codified procedures, inadequate internal training and oversight, and often an absence of any semblance of good customer service practices. 

Really smart and talented lawyers can look like fools to clients, when they lack savvy on the business side of the practice.  Really smart and talented lawyers lose clients when they fail to provide high-quality customer service.  What is that?  Responding to telephone calls and emails promptly.  Keeping the client informed.  Letting the client know what’s happening before they have to pick up the phone and ask.

Right now, most states will provide CLE credit for any education which improves an attorney’s legal skills OR practice management skills.  But in PA, the only way to obtain CLE credit is for substantive practice skill education, or ethical / malpractice avoidance training.  I have managed to create a wealth of seminars over the years which qualify for ethics credit, but I can’t say it’s not difficult and very limiting in terms of the content I can present.  How I long to present a seminar for CLE credit which is about nothing more than nuts and bolts of how to properly manage aspects of ones practice.

I guarantee that lawyers would enjoy their practice more, be more profitable, and most importantly, avoid getting themselves in disciplinary trouble inadvertently.  I know that “some day” the CLE rules in PA will change.  It’s inevitable.  I just had to let off a little steam about this, because I’ve been waiting for 14 years, and there is still no change in sight.  Do you agree with my perspective?

The Run For The Door

We’ve all heard stories, watched it in action, or been in the middle of what I refer to as The Run For The Door — the point at which partners determine their firm no longer has sufficient mass to cover overhead and debt, and the mass exodus begins.  Those who move too slow are left to turn off the lights, and are often left holding the proverbial bag.  It’s an ugly thing to watch.  In some cases it’s led to some undesirable career detours.  In some cases it’s led to the loss of a special culture.

Let’s be frank.  Partners with a good reputation and solid book of business always land on their feet.  In fact, just rumors that a firm may be experiencing difficulty, even if only temporary, is seen as an opportunity by other firms; often leading to a sharp increase in activity by competitors who attempt to lure away some of the best and brightest.  When some of those recruiting efforts result in departures, even if only of a few key rainmakers, it can easily trigger “The Run” as remaining partners, particularly top earners, become concerned about the impact on their future compensation.

Such is the case with Howrey.  It’s partners voted on Wednesday, March 9th, to dissolve effective March 15th.  The vote required a supermajority of 85% of partner shares to carry the vote for dissolution.  The story appeared in AmLaw Daily.

’”Once you lose a certain mass, you just can’t get it back,” one partner says. “It’s just a matter of days right now.” Adds the second partner: “I did it with a heavy heart, but if we don’t vote for formal dissolution, if you think it’s chaos now, it’s just going to turn into a disaster. You don’t want it to be a situation where the last person turns out the lights.”

According to the article, the firm has seen more than 140 partners depart since April 2010.  They were smart enough to recognize the stampede was well underway, and take the vote which would insure the least damage for those still at the firm.  Hopefully, this will not be one of those failures which leaves creditors in hot pursuit, and generates lawsuits from and between former partners.

From time to time I advise firms about to draft partnership or shareholder agreements.  There are a number of the subjects I always have to put squarely on the table for discussion, and it always makes the principals squirm.  I do it because I know it’s necessary.  What are those subjects?

  1. Termination of partners.  Exactly what can trigger involuntary termination?  Arrest?  Conviction?  Public embarrassment to the firm?  Damage to the firm’s reputation?  Lapse in fiduciary responsibility?  If termination is to be considered, how realistic is a 100% vote to get the job done?  What is more realistic?  What is a terminated partner entitled to, and should it be different from a partner who leaves voluntarily?
  2. Firm dissolution.  The obvious question regards the vote required to evoke dissolution.  But beyond that, there are a whole host of issues which should be addressed.  For example, I believe that purchase of an unlimited-duration Extended Reporting Period Endorsement (“the tail”) on the firm’s professional liability insurance policy should be required in the event of dissolution, and that all stakeholders who were part of the firm in the fiscal year of dissolution should be required to pay their prorata share of the cost.Records retention and management issues also come into play big time.  There will be enormous number of files which are closed, many of which will belong to clients no longer with the firm, and developed by lawyers long gone as well.  They cannot just be thrown in the trash. (Although there have been some pretty awesome stories from time to time about the frustrated few partners left to turn off the lights who, in frustration caused by former partners who wouldn’t help and didn’t care, actually did throw files in the trash.  Sanctions were always harsh.)   Someone has to remain the custodian of the files, oversee destruction when the proper retention period has tolled, ensure proper authorization has been received beforehand if any original or valuable client property remains in the file, and pay for storage until all files have been properly returned to clients or destroyed in accordance with ethical requirements and Rule 1.15 [Safekeeping Property].

These are but two areas of concern which can cause a great deal of  acrimony, and even disciplinary action, if not taken into consideration beforehand.  And there are many more.

My point?  No matter how large or small, any firm, except for a solo firm, can experience a “run for the door”.  Be prepared for that eventuality, as awful and remote a possibility as it may seem.  Otherwise, precisely at a time when you may be trying to start anew, your past may be holding you back by distracting you and consuming your valuable time with squabbles and lawsuits.

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More on Bad Check Frauds

I read a blog post today written by one of my peers.  Sheila M. Blackford, the author,  is an attorney and Practice Management Advisor for the Oregon State Bar Professional Liability FundSo here I come to post a link to it, and find that the last thing I wrote about on this blog was exactly the same topic.   Yes, it’s that important, or we wouldn’t keep repeating it.

I’ve been absent from the blog for a while.  A sudden need to provide care for a loved family member, on top of everything else, changed a few priorities in the interim.  Sadly, this blog had to wait for some semblance of normalcy to return; achieved by hiring 24-hour at-home caregiver service.  I make no apologies — I did what I had to do.

I will be blogging more about contingency plans, disaster prevention and recovery, and overload issues in upcoming posts.  The recent experiences have reminded me that there are certain areas which need to be talked about repeatedly, in order not to lose our vigilance and preparedness.  (And that means having “Plan B” is not optional!)

Returning to the topic of this post, I suggest you take a moment to read Sheila Scanlon’s post entitled “Bad Check Frauds: ‘Tis the Season for Lawyers to Be Wary” because it’s loaded with very practical information and suggestions on protecting your practice.

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