Articles, Newsletters & Advisories
March 26, 2020Pennsylvania Legislature Considering Modification of Public Meeting Rules, Suspension/Tolling of Land Use Application Deadlines during COVID-19 Emergency Declaration
Among the many challenges facing Pennsylvania municipalities during the COVID-19 pandemic is how to conduct business in compliance with applicable statutory requirements when the physical presence of their officials, constituents, development applicants and other interested parties is either highly discouraged by public health officials or prohibited altogether. This can be particularly problematic for applicants for a variety of local government land use approvals, consideration and action on which usually are statutorily mandated to take place at public meetings and hearings.
In an effort to address these issues, the Pennsylvania General Assembly is currently considering House Bill No. 1564 on an expedited basis. Among other things, HB 1564 would relax the requirements for physical attendance at public meetings during the Governor’s declaration of a disaster or emergency by substituting a variety of telecommunications alternatives. It also would provide for the suspension, or tolling, of statutory deadlines for municipal boards and agencies to hear and act upon a wide variety of land use and other development applications during the pendency of such a declaration. Notably, HB 1564 provides that an applicant can request, and a municipality at its discretion may proceed with, consideration and action on an application using telecommunication alternatives.
HB 1564 is on a fast track, with the House approving it on March 25, 2020, and the Senate expected to act upon it in the next several days. HB 1564 can be viewed here.
The following are the key provisions of HB 1564.
Use of Telecommunication Devices to Conduct Public Meetings
If the declaration is of a disaster or emergency which would render the conduct of public business dangerous to the health or safety of the members of the governing body, officials or members of the public, the governing body may exercise...
March 25, 2020DOL Announces April 1 Effective Date and Additional Guidance on Families First Coronavirus Response Act
Employment & Labor Alert
This is a follow-up to Babst Calland’s client alert on the Families First Coronavirus Response Act provisions and related new leave requirements. The Department of Labor announced that the effective date will be April 1, 2020. The leave is not retroactive and begins April 1. Each company’s number of employees to determine whether it meets the 500-employee threshold will be calculated at the time the leave is to be taken. The Department of Labor released Question and Answer guidance available here, providing additional preliminary information on calculating the employee threshold, leave calculations, rate of pay calculations, and interactions with other types of leave. The full regulations have not yet been released, and are expected prior to the April 1 effective date.
The model notice issued by the Department of Labor is available here, and was issued along with a Frequently Asked Questions regarding the notice requirements available here. The notice does not need to be displayed until April 1, 2020 and most employers will want to wait to publish the notice until their FFCRA policy is ready to avoid employee confusion. The notice must be posted in a conspicuous place on the employer’s premises, which may include email, company intranet, or physically at the workplace depending upon current operations.
Please contact any of Babst Calland’s Employment and Labor attorneys if you need advice on the Families First Coronavirus Response Act and its requirements.
March 23, 2020Protect what’s yours: How to create a strong trademark with a new product or business name
(by Jayne Gest with Carl Ronald)
A trademark or service mark identifies a company as the source of a particular set of goods or services. It protects the association, in a consumer’s mind, between goods or services and the company that sells or produces them.
“We try to protect the goodwill a company has earned by registering and enforcing their trademarks to make sure no one obtains an unfair business advantage by trading off our clients’ goodwill in the marketplace,” says Carl Ronald, shareholder at Babst Calland.
Smart Business spoke with Ronald about adopting trademarks.
How long do trademarks last?
Theoretically, trademarks can last forever. Realistically, though, trademark protection lasts as long as you continue to use a name or logo in the marketplace. There are two types, registered and unregistered, and the latter is often called “common law” marks.
A registered trademark is a text or design mark that a company applies for with the United States Patent and Trademark Office. So long as the business continues to use the mark and appropriate maintenance procedures are complied with, the registration will be good for an unlimited number of renewable terms of 10 years each.
Common law marks, on the other hand, last as long as they continue to be used in commerce but convey less protection.
What’s the procedure for protecting a new product or business name?
First, identify the word or logo you wish to use with your product or service, and decide whether you’re likely to use it longer than a few years, in order to justify the cost. Is this a name for a core product, or a slogan that plays off a current event or product line that may change seasonally or annually?
Next, evaluate the strength of the mark. The strongest are made-up word(s) that don’t describe what you...
March 20, 2020Seeking Clarity around Governor’s Order to Close Pennsylvania Businesses that are not “Life-sustaining”
In the late afternoon of March 19, 2020, and without advanced notice, Pennsylvania Governor Tom Wolf issued an Order for all “non-life-sustaining businesses” in the Commonwealth to close their physical locations. The Order was effective at 8 p.m. last evening with enforcement to begin at 12:01 a.m. on Saturday, March 21. A copy of the Order can be found here. There are many questions that arise from the Governor’s Order, and it can be expected that further clarifications will be forthcoming from the Governor’s office. The Governor’s office has also issued a press release with additional information.
In a press conference at 2 p.m. today, the Governor stated that the guidelines are being revised based upon feedback from businesses and other stakeholders, and that the forthcoming guidelines will be in line with the federal government’s Cyberspace and Critical Infrastructure Security Agency (CISA) guidance that has identified 16 “Critical Infrastructure Sectors,” as available here. In addition, the Governor encouraged businesses to seek a waiver if they believe that they have been incorrectly categorized as “non-life-sustaining.” The waiver process is meant to “cut through red tape” and the Governor stated that decisions will issue via email.
While further guidance remains pending, this Alert will summarize the current Order and suggest methods to address confusion regarding the Order or to seek relief from its provisions.
The Order provides that “No person or entity shall operate a place of business in the Commonwealth that is not a life sustaining business regardless of whether the business is open to the members of the public.” The Order does not prevent working from home. The Order further provides specific guidance on what the Governor has decided is a “life sustaining business.” A list of businesses and industries that...
March 20, 2020Turning Down the Heat – What sort of legal and legislative action is necessary to help put Pennsylvania on the front lines of the battle against climate change
Pennsylvania's Best Lawyers
(by Joseph Reinhart)
Much state environmental law is based on federal statutes. How can environmental-law attorneys help?
Environmental lawyers can be instrumental in sustaining rural communities and protecting natural resources by helping landowners and businesses understand the complex and interrelated laws and regulations governing so many aspects of economic development. Many municipalities in Pennsylvania have passed ordinances designed to protect residents in rural areas from environmental harm associated with natural-resource development. In some cases, these ordinances are issued with the intention of implementing Pennsylvania’s Environmental Rights Amendment. These ordinances may require approval prior to conducting activities as common as earth disturbance and road usage. Sorting out the laws and ordinances applicable to these activities, and determining which governmental authority has jurisdiction over them, are tasks well-suited to attorneys trained in environmental law.
Many states have developed their own climate-change plans. Do you think Pennsylvania will do that?
In 2018, Governor Tom Wolf issued an executive order establishing a Climate Action Plan for the commonwealth. The plan seeks to achieve, by 2025, a 26 percent reduction in greenhouse-gas emissions from 2005 levels. It includes a wide variety of proposed actions, including improvements in energy efficiency, increased use of electric vehicles, maintenance of nuclear generating capacity, and investment in solar development. The plan also contemplates development of a cap-and-trade program to limit carbon-dioxide emissions.
Will the passage of certain laws be necessary?
Wolf’s executive order requiring the development of a cap-and-trade program has been met by stiff resistance from parties concerned about the costs and potential adverse economic consequences associated with a carbon tax. In December 2019, members of the Pennsylvania House and Senate referred bipartisan companion bills, known as the Pennsylvania Carbon Dioxide Cap and Trade Authorization Act, to their respective environmental and energy committees. The proposed legislation provides that there...
March 20, 2020The Coronavirus May be a Basis to Invoke the Force Majeure Provision of Consent Orders and Consent Decrees in Pennsylvania
On March 6, 2020, Governor Tom Wolf issued a Proclamation of Disaster Emergency throughout the Commonwealth under the Pennsylvania Emergency Management Services Code in response to the expanding COVID-19 coronavirus pandemic. On March 13, President Donald Trump declared a state of national emergency. Many other states and local governments are following suit. These government actions may be a basis to invoke the force majeure clause of consent orders and consent decrees between regulated parties and the Pennsylvania Department of Environmental Protection, other state and local environmental regulatory agencies or the U.S. Environmental Protection Agency.
The standard force majeure provision of most PADEP consent order and agreements allows deadlines in the order to be extended if circumstances beyond the reasonable control of the regulated party prevent compliance with the order. Similar provisions are often found in consent agreements with USEPA and in consent decrees approved by federal and state courts. These force majeure provisions typically require the affected party to notify the agency of the force majeure event when the party becomes aware or reasonably should have become aware of the event impeding performance. For example, the model PADEP Consent Order and Agreement requires telephone notice within five working days and written notice, in some circumstances by notarized affidavit, within 10 working days describing the reasons for the delay, the expected duration of the delay, and the efforts being taken to mitigate the effects of the event and length of the delay. This model provision states that failure to comply with the timing and notice requirements invalidates a force majeure extension.
There are compelling reasons why the coronavirus pandemic, which is unlike any event experienced in this country, is beyond the contemplated scope of agency force majeure clauses such that strict...
March 19, 2020The Families First Coronavirus Response Act
Employment & Labor Alert
The Families First Coronavirus Response Act (the “Act”) was enacted on March 18, 2020 and adds two additional types of leave connected to the coronavirus (“COVID-19”) pandemic. Employers should immediately institute policies relating to these new leaves to ensure proper compliance and to avoid violating the Family and Medical Leave Act or the Fair Labor Standards Act.
Key Provisions Related to CoverageThe new leave provisions apply to private sector employers with fewer than 500 employees and provide eligible workers with additional paid and unpaid time off over and above any existing leave already provided by their employer. Businesses that were too small to be previously subject to FMLA are now covered by these provisions. Under the Act, the Secretary of Labor is given the authority to issue regulations that would exclude health care workers and emergency responders from the Act, as well as businesses with less than 50 employees where the regulations would jeopardize the business as a going concern. Unless and until the Secretary of Labor issues such regulations, the provisions of the Act apply to all private sector employers with less than 500 employees. Any leave payments made pursuant to the Act are capped as described below at the amount of the tax credits created to reimburse employers (maximum aggregate over both leaves of $15,110 per employee). The Act is effective not later than April 2, 2020, and remains in effect until December 31, 2020. Under the Act the Department of Labor is to issue a mandatory workplace poster relating to the new leave provisions by March 25, 2020.
Emergency Paid Sick LeaveFull-time employees regardless of tenure are immediately eligible for 80 hours of paid sick leave on the Act’s effective date. Part-time employees...
March 18, 2020Business Continuity During the COVID-19 Pandemic; Leveraging AI/Machine Learning Contract Review
(by Christian Farmakis)
Dear Clients and Friends:
Clearly, in light of the COVID-19 pandemic, this is a time for reflection and a time for staying on top of our personal and professional priorities.
With the Coronavirus pandemic having a widespread effect on business continuity, supply chains and revenues, Babst Calland and its alternative legal service provider, Solvaire, are currently advising C-suite executives and managers as they seek to quickly assess their contract provisions, evaluate their exposure and make effective operational and financial risk-based decisions. Of particular concern, key suppliers may desire to invoke “force majeure”, delay or termination provisions during this time of uncertainty. Similarly, our clients may desire to invoke these same provisions to delay or terminate unessential projects.
By employing a series of AI/machine learning and other legal technologies, we can conduct accelerated and thorough searches across huge document sets revealing key information about each contract before our professional staff even begins reviewing the documents. During this time, we understand the unprecedented challenges your organization and internal teams may be facing. Our team is here to help. Solvaire has 20 years of project management and quality control experience to organize and manage contract review projects from start to finish.
We employ flexible staffing models and can quickly ramp up staffing based on deadlines and need. Our reviewers and staff are fully capable of working remotely, allowing us to comply with the latest CDC Guidelines regarding social distancing.
Projects can be customized to fit your timeline and needs. Representative contract clause extraction provisions include force majeure, material adverse effect, termination, insurance, delay, term, governing law, payments and notice information, among others. Our legal technologies can also be quickly “trained” to find critical contract provisions unique to your business or industry.
Our entire team stands ready to assist in your business continuity. Please take care...
March 11, 2020DEP unveils initial draft of carbondioxide trading rule to Air Quality Technical Advisory Committee
The PIOGA Press
On February 13, the Department of Environmental Protection presented its preliminary draft proposed rulemaking to establish a carbon dioxide budget trading program to the Air Quality Technical Advisory Committee (AQTAC). The proposed trading program would apply to fossil fuel fired electricity generators of greater than 25 MW in Pennsylvania. The draft proposal reflects a first look at DEP’s vision for a cap-and-trade program as directed by Governor Tom Wolf’s October 3, 2019, Executive Order 2019-07.
The draft proposed rule, although still in development, parallels the model rule prescribed by the Regional Greenhouse Gas Initiative (RGGI). RGGI is a coalition of 10 states in the Northeast and Mid-Atlantic that participate in a regional CO2 cap-andtrade program for fossil fuel-fired electricity generating units that have a nameplate capacity of over 25 MWe.
Under the program, each member state has a budget of CO2 allowances, which it then allocates through setaside programs, offsets or periodic auctions. The number of allowances in each state’s CO2 budget that are allocated through auction varies widely among members. Each affected source (CO2 budget source) is required to hold sufficient CO2 allowances based on its CO2 emissions as determined from continuous monitoring. Each allowance is equal to one ton of CO2 emissions.
States’ CO2 budgets, and in turn available allowances, periodically reduce over time. This requires each CO2 budget source to either reduce CO2 emissions as measured by continuous monitoring, or obtain extra CO2 allowances to cover its emissions in excess of its allowance account. Under RGGI, auctions to obtain allowances generally occur quarterly, and may be open to qualified participants other than CO2 budget sources. The draft proposed rule explicitly mentions financial institutions and environmental groups as potential auction participants. The proposal specifies an annual rather than quarterly auction process.
March 6, 2020Court Provides Clarity on the Applicable Scope of Review in Land Use Appeals
The Legal Intelligencer
(by Alyssa Golfieri)
Zoning hearing boards have exclusive jurisdiction to hear and render final adjudications on nine discrete matters, ranging from substantive challenges to the validity of land use ordinances, to appeals from determinations of a zoning officer, to applications for variances and special exceptions from the terms of zoning and floodplain ordinances. See Section 909.1(a) of the MPC, 53 P.S. Section 10909.1(a). If a party to a land use matter is unhappy with a zoning hearing board’s final adjudication, he has 30 days to appeal the decision to the trial court. See Section 1002-A of the MPC, 53 P.S. Section 11002-A.
When rendering final adjudications, zoning hearing boards sit as fact finders. This means zoning hearing boards are the sole judge of the credibility of witnesses and the weight afforded evidence. See Tri-County Landfill v. Pine Township Zoning Hearing Board, 83 A.3d 488, 518 (Pa. Commw. Ct. 2014). As such, when a zoning hearing board’s decision is appealed to the trial court, the trial court should not, with one exception addressed below, engage in fact-finding or disturb the board’s credibility determinations. See Section 1005-A of the MPC, 53 P.S. Section 11005-A; see also Manayunk Neighborhood Council, 815 A.2d at 652 (Pa. Commw. Ct. 2002). Rather, the trial court must uphold a zoning hearing board’s determination so long as the board did not commit a manifest abuse of discretion—an abuse of discretion occurs only when a zoning hearing board’s findings are not supported by substantial evidence, which Pennsylvania courts have defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. See Berman v. Manchester Township Zoning Hearing Board, 540 A.2d 8, 9 (Pa. Commw. Ct. 1988); Hertzberg v. Zoning Board of Adjustment, 721 A.2d 43, 46 (Pa. 1988)—or an error of law.
The one exception to a trial court’s deferential standard of review is a circumstance where the trial...
March 4, 2020Potential Impacts to Real Estate Development of Proposed Amendments to NEPA Regulations
Proposed changes to regulations implementing the National Environmental Policy Act of 1969 (NEPA) have the potential to affect real estate development within the greater Pittsburgh region and nationwide. The proposed regulations, issued by the Council on Environmental Quality (the “CEQ”) in January 2020, would revise NEPA procedures by narrowing both the scope of actions that must be reviewed under NEPA as well as the extent of such review. With these changes, the time, cost and environmental analysis required to comply with NEPA could be significantly reduced, and development projects that previously faced delays could proceed more quickly through the review process, or potentially avoid it altogether.
Background and Purpose of NEPA
NEPA was enacted in 1970 with the goal of promoting accountability and transparency in federal decision-making by ensuring that the environmental impacts associated with federal actions were considered by the agencies undertaking those actions. Under NEPA, each federal agency is responsible for conducting a NEPA analysis on all agency actions that are deemed “major Federal actions” to determine if such actions impact the environment. “Major Federal actions” are currently defined in CEQ NEPA regulations as “actions with effects that may be major and which are potentially subject to federal control and responsibility” (emphases added). That may include both federal projects and projects undertaken by non-federal entities that receive federal funding or require federal permitting. Examples of major Federal actions include oil and natural gas pipeline construction projects, highway construction, and bridge replacement. The federal agency that takes a major Federal action (e.g., the issuance of a permit) is required to prepare an analysis of the project’s effects on the environment, which can take three forms: (i) a categorical exclusion (CE) for an action that has been...
March 4, 2020Babst Calland Attorney Jean M. Mosites Appointed to the EHB Rules Committee
Jean M. Mosites was recently appointed by Rep. Mike Turzai, the Speaker of the Pennsylvania House of Representatives to the Pennsylvania Environmental Hearing Board Rules Committee. Committee members serve two-year terms and may be reappointed for additional terms.
The Rules Committee reviews and makes recommendations regarding procedural rules for matters brought before the EHB. The Committee consists of nine attorneys who are in good standing before the Bar of the Supreme Court of Pennsylvania and who have practiced before the Board for a minimum of three years or who have comparable experience.
As a shareholder in Babst Calland’s Environmental and Energy and Natural Resources practice groups, Ms. Mosites has extensive experience representing clients in administrative appeals and environmental litigation in state and federal courts and before the Environmental Hearing Board in Pennsylvania, as well as counseling on environmental compliance and resolving liabilities under federal and state law.
February 26, 2020Julie R. Domike – Environmental Attorney
Emerging Technologies Profile
Is there one thing you recall that influenced your career path? Yes, I started thinking about hands-free vehicles when I was just a kid. On a vacation back to the U.S., as my father accelerated the family station wagon onto the highway, I imagined something like a subway’s third-rail. Vehicles would connect to it and travel forward in a safe and graceful caravan. Drivers would be able to use their time how they pleased—maybe playing a game of cards with their daughters. When it was time to return to active driving, the vehicle would disconnect, and the driver would resume the controls. Even back then, the idea made so much sense to me.
What may surprise people about your background? As an attorney at the EPA, I was involved in rulemaking and enforcement for the first part of my career. In private practice, I represent companies that have been the focus of EPA’s regulations. Some of my friends tell me that my best skill is as an intermediary who can play on both sides of the regulatory fence.
What brought you to the nation’s capital? As the daughter of an American working abroad, I was raised all over Latin America. While growing up in countries still squarely under the thumb of charismatic caudillos, the idea of a country governed by law instead of one man’s whims seemed like a paradise. I’ve always been impressed by the predictability that stare decisis and precedent lend to our system. My law degree is from Georgetown, and from there I joined the EPA where the focus was on implementing the 1990 amendments to the Clean Air Act.
How do you ease your daily commute into/out of the District? Currently, while en route, I’m listening to the audiobook Go, Went, Gone by German novelist Jenny...
February 24, 2020The value of M&A and why you can’t afford to ignore it
(by Jayne Gest with Chris Farmakis)
Vivak Gupta has hands-on experience with M&A — including his share of battle scars — after 36 years in the IT industry. Most recently, he was the president and CEO behind Mastech Digital’s $55 million deal for InfoTrellis in 2017.
No two acquisitions are the same, but he says he tries not to make the same mistakes twice.
“It’s a pretty complex process, and there is no shortcut but to actually learn from experience,” Gupta says. “It’s baptism by fire — you have to burn your fingers and then you really get to know what works and what doesn’t work.”
But even when Gupta isn’t actively looking to buy or sell a business, he keeps an eye on the dealmaking market — who is buying and selling companies and raising capital — because it’s a good indicator of what’s happening in the industry.
“Why is my competitor acquiring a company in, just as an example, the cloud space?” he says. “How is it connecting with their current strategy? Then, you watch how they complete the acquisition and how the market rewards them or penalizes them for that acquisition.”
Gupta isn’t alone in his feelings about the value of M&A. Many executives, investors and advisers see how mergers, acquisitions and dealmaking play a critical role in business today — both directly and indirectly. And those who ignore it run the risk of falling behind as their competitors scoop up a new technology, diversify into new geographies, raise growth capital and implement long-term exit plans that help them operate better.
You owe it to yourself to build your M&A knowledge and network, but don’t take our word for it. Here’s what some of Pittsburgh’s dealmakers had to say.
Take the initiative
M&A is done by different companies for different reasons, Gupta...
February 24, 2020The rise of representations and warranty insurance
(by Jayne Gest with Kevin Wills)
Representations and warranties insurance, which has become more affordable for merger and acquisition transactions, is growing much more prevalent in recent years as the market for such insurance has grown more competitive.
“If you haven’t paid attention or you’re not a regular acquirer of businesses or assets, your opinion of reps and warranties insurance might be dated,” says Kevin T. Wills, shareholder and chair of the corporate and commercial group at Babst Calland.
Smart Business spoke with Wills about how representations and warranties insurance works and what to consider with this risk mitigator.
What are the benefits of utilizing reps and warranties coverage?
These policies can be advantageous for both buyers and sellers.
For a seller, it can reduce or eliminate any need to holdback or escrow a portion of the purchase price with respect to post-closing indemnification claims for breaches of representations and warranties. This provides a seller with a cleaner exit with less contingent liabilities and more certainty as to the sale proceeds. Additionally, if a seller is going to have an ongoing relationship with the buyer, it also avoids the potential awkwardness a lawsuit may cause.
On the buyer side, it can make your bid more attractive if the seller knows that it will not be responsible for post-closing claims for breaches of representations and warranties. It helps with the negotiation of the purchase agreement because a seller is less concerned with their post-closing exposure for breaches of representations and warranties, which saves time and reduces legal fees. Also, in some instances, the coverage limit and duration that the buyer acquires — the amount of the insurance policy and the term thereof— may exceed what the seller would be willing to give in a negotiated indemnification context. Further, liability baskets and caps do...
February 18, 2020Treasury Issues Committee on Foreign Investment in the United States Review Rules
Emerging Technologies Alert
Technology companies seeking foreign investment should be aware of recently effective changes to the Committee on Foreign Investment in the United States (CFIUS) notification process for investments by foreign entities. While these changes generally mirror CFIUS’ recently terminated pilot project, differences between the programs could determine whether a US business needs to file with CFIUS for pre-foreign investment review. The following client alert explains the program changes in greater depth.
On January 17, 2020, the Treasury Department’s Office of Investment Security (Treasury) released two final rules requiring some foreign entities acquiring an interest in a US business with a national security nexus (Transaction Rule)
The Treasury implemented a version of the Transaction Rule under a 2018 interim final rule and through a pilot program requiring mandatory declarations of certain transactions involving investments by foreign entities in US businesses beginning November 10, 2018. The Transaction Rule replaced the pilot program beginning February 13, 2020. The Real Estate Rule also took effect that day.
What’s in the Rule?The Transaction Rule largely continues the processes adopted for...
February 18, 2020Pennsylvania DEP Unveils Initial Draft of Carbon Dioxide Trading Rule to Air Quality Technical Advisory Committee
On February 13, 2020, the Pennsylvania Department of Environmental Protection presented its preliminary draft proposed rulemaking to establish a carbon dioxide budget trading program to the Air Quality Technical Advisory Committee (AQTAC). The proposed trading program would apply to fossil fuel-fired electricity generators of greater than 25 MW in Pennsylvania. The draft proposal reflects a first look at Pennsylvania DEP’s vision for a cap-and-trade program as directed by Governor Tom Wolf’s October 3, 2019 Executive Order 2019-07.
The draft proposed rule, although still in development, parallels the model rule prescribed by the Regional Greenhouse Gas Initiative (RGGI). RGGI is a coalition of 10 states in the Northeast and Mid-Atlantic that participate in a regional CO2 cap-and-trade program for fossil fuel-fired electricity generating units that have a nameplate capacity of over 25 MWe. Under the program, each member state has a budget of CO2 allowances, which it then allocates through set-aside programs, offsets, or periodic auctions. The number of allowances in each state’s CO2 budget that are allocated through auction varies widely among members. Each affected source (“CO2 budget sources”) is required to hold sufficient CO2 allowances based on its CO2 emissions as determined from continuous monitoring. Each allowance is equal to one ton of CO2 emissions.
States’ CO2 budgets, and in turn, available allowances, periodically reduce over time. This requires each CO2 budget source to either reduce CO2 emissions as measured by continuous monitoring, or obtain extra CO2 allowances to cover its emissions in excess of its allowance account. Under RGGI, auctions to obtain allowances generally occur quarterly, and may be open to qualified participants other than CO2 budget sources. The draft proposed rule explicitly mentions financial institutions and environmental groups as potential auction participants. The proposal specifies an annual...
February 14, 2020PHMSA Issues Final Rule for Underground Natural Gas Storage Facilities
Pipeline Safety Alert
On February 12, 2020, the Pipeline and Hazardous Materials Safety Administration (PHMSA or Agency) released a final rule establishing new safety standards and reporting requirements for underground natural gas storage (UNGS) facilities (the Final Rule). The Final Rule modifies regulations that PHMSA previously established in an interim final rule (IFR) to address a congressional mandate in the Protecting Our Infrastructure of Pipelines and Enhancing Safety Act of 2016 (PIPES Act).
The Final Rule follows the approach taken in the IFR by incorporating the provisions in two industry safety standards for UNGS facilities by reference but eliminates the requirement to treat the permissive elements of those standards as mandatory. The Final Rule also makes other changes to the IFR, many of which respond to issues raised in public comments, a petition for reconsideration filed by several industry trade organizations, and a petition for judicial review filed by the State of Texas in the U.S. Court of Appeals for the 5th Circuit. Additional information about the Final Rule, which takes effect on March 13, 2020, is provided below.
Revised Approach to Non-Mandatory Provisions of API RP 1170 and API RP 1171
The Final Rule eliminates what was arguably the most controversial aspect of the IFR, i.e. the requirement to treat the permissive elements of two industry standards as mandatory. In the 2016 IFR, PHMSA incorporated API Recommended Practice 1170 Design and Operation of Solution-mined Salt Caverns Used for Natural Gas Storage (RP 1170) and Recommended Practice 1171 Functional Integrity of Natural Gas Storage in Depleted Hydrocarbon Reservoirs and Aquifer Reservoirs (RP 1171 or RPs, collectively) by reference. Like most industry standards, the RPs contain provisions that create mandatory obligations (“shall” statements) and non-mandatory permissive obligations (“should” statements). The IFR treated the “should” statements in...
February 12, 2020Christian Farmakis Featured Speaker at Dealmakers Conference
Law firm Babst Calland will participate at the 2020 Smart Business Dealmakers Conference in Pittsburgh, Pa. on March 5 at Wyndham Grand Pittsburgh Downtown.
The conference will feature middle-market CEOs, top private equity and venture capital firms, major lenders and leading service providers participating in sessions that cover the breadth of the merger and acquisition landscape addressing such topics as buying a business, selling a business, financing a deal, liquidity events, merging operations, alternative investing and more.
Attorney Christian A. Farmakis will join a group of recognized entrepreneurs and business experts in discussing Transaction Audits: How to prepare your company for any type of deal.
For more information about the Dealmakers conference, or to register to attend, visit: https://www.smartbusinessdealmakers.com/pittsburgh//event/
February 11, 2020PHMSA Proposes New Valve Installation and Minimum Rupture Detection Standards for Gas and Hazardous Liquid Pipelines
Pipeline Safety Alert
On February 6, 2020, the Pipeline and Hazardous Materials Safety Administration (PHMSA) published a notice of proposed rulemaking (NPRM) in the Federal Register containing new valve installation and minimum rupture detection standards for gas and hazardous liquid pipelines. The NPRM would require the installation of automatic shutoff valves (ASV), remote-control valves (RCV), or equivalent technology, on certain gas transmission and hazardous liquid pipelines. The NPRM also contains proposed requirements for rupture detection and mitigation, including provisions for improving emergency response and conducting failure investigations and analyses. Public comments must be filed in response to the NPRM on or before April 6, 2020. Additional background information and a brief summary of PHMSA’s proposals are provided below.
Why Did PHMSA Issue the NPRM?
In 2010, a pair of significant pipeline incidents occurred in Marshall, Michigan, and San Bruno, California. The resulting NTSB investigations led to the issuance of safety recommendations relating to the use of ASVs and RCVs and other measures to improve rupture detection and response. Also, in the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011 (2011 Act), Congress added mandates to the Pipeline Safety Act directing PHMSA to conduct studies and, if appropriate, establish regulations to address the concerns identified in NTSB’s safety recommendations. In the years following the 2011 Act, PHMSA commissioned the studies required by the congressional mandates and received separate recommendations from GAO on the need to improve pipeline incident response. PHMSA also issued two ANPRMs after the 2010 pipeline incidents asking for public comment on the need to amend the pipeline safety regulations for valve installation and rupture detection. All of these factors culminated in this NPRM.
What’s in the NPRM?
Valve RequirementsInstallation Requirements for New Pipelines: Pursuant to 49 C.F.R. §...
February 10, 2020Revised DEP policy would expand the scope of projects requiring PHMC review
The PIOGA Press
On December 28, the Pennsylvania Department of Environmental Protection published notice of a substantive revision to the Policy for Pennsylvania Historical and Museum Commission (PHMC) and DEP Coordination During Permit Application Review and Evaluation of Historic Resources (012-0700-001). The draft policy, if finalized, would replace Implementation of the Pennsylvania State History Code: Policy and Procedures for Applicants for DEP Permits and Plan Approvals, finalized in 2002 and amended in 2006, and establishes the framework DEP would implement for its plan approvals and permit application reviews to comply with Pennsylvania’s History Code, 37 Pa. C.S. §§ 101 et seq.
The History Code and its application to oil and gas operations
Under Section 507 of the History Code, Common-wealth agencies must notify PHMC before undertaking any Commonwealth or Commonwealth-assisted permitted or contracted project that affects or may affect archaeological sites and provide PHMC with information concerning the project or activity. DEP requires applicants to submit the State Historic Preservation Office (SHPO) Project Review Form to PHMC if their project potentially affects an archaeological site. After receiving the form from the applicant, PHMC must then determine whether the project may adversely affect an archaeological site.
Oil and gas operations potentially fall within the History Code’s consultation and survey requirements as “Commonwealth-assisted permitted projects.” Activities that require state permits, such as construction of well pads, pipelines, compressor stations and underground injection control wells, could have the potential to affect historic resources that come within the purview of the PHMC coordination requirements in the History Code.
Neither the History Code nor the draft policy mandates outcomes for known or discovered historic resources identified during the review process or during a survey or field investigation. If PHMC identifies potential adverse effects to archaeological resources that may result...
February 7, 2020New WOTUS definition finalized, new challenges expected
The PIOGA Press
On January 23, the U. S. Environmental Protection Agency and the U. S. Army Corps of Engineers pre-published the final Navigable Waters Protection (NWP) Rule, which (yet again) redefines the scope of waters regulated under the Clean Water Act (CWA). In particular, the final NWP Rule revises the definition of “waters of the United States” (WOTUS) in 12 federal regulations and will become effective 60 days after publication in the Federal Register.
Once effective, the NWP Rule will almost certainly be challenged in the courts by NGOs and other interested parties. These challenges could result in the courts staying the NWP Rule in some, or all, states while the lawsuits are litigated.
The NWP Rule is the final step in fulfilling the Trump administration’s promise to repeal and replace the Obama administration’s 2015 Clean Water Rule (CWR), which many believe improperly expanded the scope of waters regulated under the CWA. Effective December 23, 2019, EPA and the Corps repealed the CWR and restored the WOTUS definition that existed before 2015. Prior to the repeal, the pre2015 rule’s WOTUS definition applied in approximately half of the states, while the CWR’s WOTUS definition applied in the remainder (including Pennsylvania), resulting in certain states having more federally regulated waters than other states.
The stated intent of the NWP Rule is to provide “clarity, predictability and consistency” regarding CWA jurisdiction. Consistent with President Trump’s February 28, 2017, Executive Order, the NWP Rule heavily reflects and relies upon Supreme Court Justice Antonin Scalia’s interpretation of the pre-2015 rule’s definition of WOTUS, as expressed in his plurality opinion in the seminal case, Rapanos v. United States (547 U.S. 715 (2006)). Missing from the NWP Rule is any reference to the significant nexus test discussed in Justice Anthony Kennedy’s concurring...
February 5, 2020Elizabeth A. Dupuis named to Pennsylvania Business Central’s “Top 100 People”
Pennsylvania Business Central
Elizabeth A. Dupuis has been named to this year's Pennsylvania Business Central's "Top 100 People" list and profiled in its Signature Top 100 issue. Nominations were taken throughout the publication's 24-county coverage area, and the final honorees were selected by a special selection committee for their professional and community contributions.
Betsy Dupuis has practiced law in Central Pennsylvania since 1997, most recently as Managing Shareholder at law firm Babst Calland’s State College office. Her practice focuses on real estate transactions, business planning and formation, commercial and contract litigation, estate planning and administration. She is also a licensed title agent in Pennsylvania and conducts commercial real estate closings through MidState Closing Company, a Babst Calland affiliate.
Among other honors, she is a graduate of Leadership Centre County and was recognized by LCC with the Community Leadership Association’s Distinguished Leader Award. She is the incoming chair for the National Association of Home Builders Legal Action Committee. She presently serves on the boards of the Centre County Chamber of Business and Industry (CBICC), the Central Pennsylvania Risk Management Association, and the Pennsylvania Builders Association. She is a past Chair of the Centre County United Way and the Palmer Museum of Art Gala.
She was recently re-appointed for a second four-year term as Solicitor for Centre County.
Top 100 People The vibrant economic and social life of central Pennsylvania is powered by people. When goods or services are delivered in an efficient and timely manner, expertise and knowledge brought to bear on a problem, or necessary care provided, it’s not just the businesses and the institutions – but the people behind them that get the job done. We all know that powerhouse individual – the person with the vision, dedication and drive to not only complete the task, but to envision, expand and excel. We...
January 31, 2020Artificial Intelligence Is Transforming the Legal Industry
The Legal Intelligencer
(by Christian Farmakis)
Artificial intelligence (AI) is adding efficiencies and transforming businesses everywhere, and legal practices are no exception.
General counsels who are hiring lawyers need to understand that this technology is available now, so they can make sure their lawyers are leveraging the latest technology tools. AI can increase speed, increase efficiency and lower costs for clients—if the law firm has the right tools, but more importantly knows how to use those tools.
The following are some of the common questions about advancement of AI technology in the legal space.
• How is AI technology disrupting the legal industry?
AI is a term generally used to describe computers performing tasks normally viewed as requiring human intellect.
AI legal technology won’t replace lawyers, but these tools will drastically change the way lawyers provide services for their clients. While estimates vary, 23%t to 35% of a lawyer’s job could be automated. As a result, lawyers will need to be more strategic and supervisorial, able to act as project managers and supervise the information being fed into systems, and knowledgeable about the assumptions underlying the machine learning algorithms.
So far, projects that classify data have been impacted the most, allowing projects such as e-discovery, due diligence, document management and research to be done faster and more efficiently.
Law firms can already pass these savings on to clients, but this is only the beginning of the transformation. Early law firm adopters are implementing artificial intelligence, machine learning and predictive analytics to legal contract review and document management, enhancing efficiency, intelligence and quality while reducing costs for clients.
For example, with the addition of artificial intelligence software, Babst, Calland, Clements and Zomnir can now deploy highly trained machine learning algorithms in its due diligence process resulting in faster, more intelligent contract or document review for clients. Whether the client...
January 31, 2020New WOTUS Definition Finalized – New Challenges Expected
On January 23, 2020, the U. S. Environmental Protection Agency (EPA) and the U. S. Army Corps of Engineers (Corps) pre-published the final Navigable Waters Protection Rule (NWP Rule), which (yet again) redefines the scope of waters that are regulated under the Clean Water Act (CWA). In particular, the final NWP Rule revises the definition of “waters of the United States” (WOTUS) in 12 federal regulations and will become effective 60 days after publication in the Federal Register. Once effective, the NWP Rule will almost certainly be challenged in the courts by NGOs and other interested parties. These challenges could result in the courts staying the NWP Rule in some, or all, states while the lawsuits are litigated.
The NWP Rule is the final step in fulfilling the Trump administration’s promise to repeal and replace the Obama administration’s 2015 Clean Water Rule (CWR), which many believe improperly expanded the scope of waters regulated under the CWA. Effective December 23, 2019, EPA and the Corps repealed the CWR and restored the WOTUS definition that existed prior to 2015 (Pre-2015 Rule). Prior to the repeal, the Pre-2015 Rule’s WOTUS definition applied in approximately half of the states, while the CWR’s WOTUS definition applied in the remainder (including Pennsylvania), resulting in certain states having more federally regulated waters than other states.
The stated intent of the NWP Rule is to provide “clarity, predictability and consistency” regarding CWA jurisdiction. Consistent with the President’s February 28, 2017 Executive Order, the NWP Rule heavily reflects and relies upon Justice Antonin Scalia’s interpretation of the Pre-2015 Rule’s definition of WOTUS, as expressed in his plurality opinion in the seminal case, Rapanos v. United States (547 U.S. 715 (2006)). Missing from the NWP Rule is any reference to the significant nexus test discussed in Justice Anthony Kennedy’s concurring opinion...