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Finney Law Firm loses Round #1 in challenge for due process for Ohio businesses

Author By Christopher P. FinneyPosted on

Tens of thousands of Ohio businesses have been forcibly closed due to the order of Ohio Health Director Dr. Amy Acton, who on her own decided which categories of businesses would be deemed “essential” and “non-essential” during the COVID-19 crisis.

Today, a hearing was held before Judge Algenon Marbley, Chief Judge of the United States District Court for the Southern District of Ohio, on a motion for Temporary Restraining Order in the case of Hartman et al. v. Acton et al.  In that case, Finney Law Firm attorneys Curt C. Hartman, Rebecca L. Simpson and Christopher P. FInney along with the 1851 Center for Constitutional Law argued simply that Tanya Hartman and her bridal shop, Gilded Social, are entitled to a due process hearing as to whether retail shops such as hers are properly categorized as “non-essential” and therefore subject to mandatory closure by the State.  In other words, she simply asked for a hearing to ascertain the propriety of her closure under Ohio law and the US Constitution.

Now, I preface this by noting that I previously have appeared in front of Judge Marbley, and not only respect him as a Judge, but genuinely like him . He has at all times shown himself to be a knowledgeable and wise jurist, and a kind man as well.

Today, Judge Marbley, for a variety of reasons, ruled that Ms. Hartman and tens of thousands of similarly-situated businesses in Ohio have no right to a due process hearing following their forced closure by the State — at least on the emergency basis sought.

Rather, he scheduled a second hearing on May 11 on a Preliminary Injunction, a similar kind of relief but one that would last until resolution of the merits of the case.

One reason enunciated by Judge Marbley I found particularly unfortunate for the decision was that Ohio could not possibly hold hearings for the tens of thousands of businesses who might appeal their closure order. In other words, that due process would simply be overwhelming to the state bureaucrats if that right was recognized.

This notion is a frightening one indeed, reminding me of the forced internment of more than 120,000 US citizens of Japanese heritage during World War II without due process. In 1944, Fred Korematsu (Korematsu v. United States, 323 U.S. 214 (1944)) challenged the “yellow scare” incarceration of Japanese Americans based solely upon their ancestry. Naturally, the outrageous, unconstitutional and racist Order was borne of fear that Japanese Americans might hold dual loyalties and harm the United States  during the War.  The U.S. Supreme Court ultimately upheld President Roosevelt’s Executive Order 9066 that resulted in that forced internment, citing that irrational fear.  From Wikipedia:

In a majority opinion joined by five other justices, Associate Justice Hugo Black held that the need to protect against espionage by Japan outweighed the rights of Americans of Japanese descent. Black wrote that: “Korematsu was not excluded from the Military Area because of hostility to him or his race”, but rather “because the properly constituted military authorities…decided that the military urgency of the situation demanded that all citizens of Japanese ancestry be segregated from the West Coast” during the war against Japan.

Can you imagine if Justice Black had added as a reason for that now-discredited decision that the U.S. Courts could not possibly sustain petitions for freedom by 120,000 individuals? It would deeply offend our claim as a nation to equal justice under the law. What if the Governor incarcerated all 10,000,000 Ohioans (which effectively he has done)? Would it be an exception to a Habeas Corpus petition that the system would be overwhelmed to provide justice to that many Ohioans?

We don’t lose our Constitutional rights when everything is going swimmingly. Rather, they become subverted from circumstances that instill such fear in our populace that the Courts elect to ignore the clear meaning of our Constitution. In other words, fear drives bad court decisions.

Today, the State of Ohio repeatedly played the fear card — the boogie man of disease and death — if we simply afforded Ohio businesses due process rights in response to the devastation of their life’s work. And it worked.

Judge Marbley has a chance to correct this unfortunate decision at the upcoming Preliminary Injunction hearing and we hope to provide him with the legal arguments and evidence he needs to reach the correct conclusion to allow due process rights to be afforded to these businessmen and women who have had their hard work and risk of capital snatched from them by unthinking, uncaring arbitrary bureaucrats.

We very much look forward to Round #2.

Paycheck Protection Program: Have you applied?

Author By Christopher P. FinneyPosted on

Over the weekend, I spoke with about a dozen 1099 or business-owner clients who (a) either still did not know about the Paycheck Protection Program or (b) did not intend to apply for various reasons.  Some discussion of that.

  1. If you don’t know about the program, educate yourself. It is broad and generous. It encompasses almost every sole proprietor, 1099 contractor and business owner in the nation.  Read about it generally here and watch this webinar for employers with W-2 employees and this webinar aimed primarily at sole proprietors and 1099 contractors.
  2. Do I have to suffer closure or severe economic damage under the COVID-19 crisis  to be eligible? No. This program makes virtually no distinction between those severely impacted and those still operating “normally.” You do need to certify some impact from the COVID-19 crisis.
  3. Isn’t this just another SBA loan program with lots of paperwork and loan fees? No, not at all.  (a) First, it is a “forgivable loan.” (b) The primary condition is that you must continue to employ your employees for 8 weeks (or call them back if you already laid them off) after the loan is made. (c) If you meet that and a few other simple conditions, the “loan” becomes a grant. (d) It is east to apply. (e) There are no fees. (f) There is no loan guarantee.  (g) Even creditworthiness is not considered. This program is designed quickly to get cash into the hands of businesspersons so they can maintain their payroll and avoid bankruptcy.
  4. How do I apply? Call your bank.  If you need more help, contact Rebecca L. Simpson of our office (513.797.2856).  Candidly, it is fairly easy and straightforward.
  5. But I read the program already is out of money? Yes, this is true, but it appears likely that Congress is poised to authorize another $300 billion this week.  Our view is the program will be fully funded until every eligible business which applies has been funded.
  6. Does the program apply to churches and other non-profits?  The program does have special rules for churches, but it generally applies to all 501-C3s and C-19s (veterans organizations).
  7. I don’t need the money; let someone else in need have the funds. This is certainly a justification for not applying, just so you have thought this through for yourself and your business.  When this program is gone, we see it as highly unlikely it will be renewed on such generous terms.

Every businessperson has their hands full right now, navigating the shoals of uncertainty and change the COVID crisis has presented, but this program almost certainly is well worth your time and attention.

Ohio Real Estate Law: What is difference between e-Closing, hybrid closing and Remote Online Notarization (RON) closing?

Author By Jane SchultePosted on
Jane Schulte

There have been numerous articles written about Remote Online Notarization (or RON) in the past few months, surrounding the Covid-19 pandemic, and the real estate industry’s need to perform work digitally to ensure that sales, purchases and refinances can occur during the social distancing orders currently in place.

However, there has been some confusion surrounding terminology and differences in digital closings, and we are writing this article is to provide some clarity.

E-closing

An e-Closing or electronic closing is a mortgage closing in which all the documents are created, accessed, presented, signed, notarized and recorded electronically. They remain in their digital form and nothing is printed out. An e-Closing is conducted with the signor(s) and Notary in each other’s physical presence, thus not accomplishing the objective of full separation of the notary/closer and the parties.

Hybrid closing

A hybrid closing is the same as an e-Closing except that the Promissory Note is papered out and wet-signed (sometimes along with the mortgage), so again the procedure does not accomplish the objective of physical separation.

Remote Online Notarization (RON)

A RON closing, on the other hand, uses an e-Notary to perform notarial acts when the signor is not in the same physical location as the notary.  The signor appears before an e-Notary in a live, recorded two-way audio/visual conference where identification is verified with a photo ID along with knowledge-based authentication technology.  A platform such as DocVerify, provides a tamper-evident seal and uses encryption and multi-layered security to prevent fraud.

Conclusion

Ivy Pointe Title is pleased to announce that it has an in-house e-Notary to provide these services for cash, lender and refinance real estate transactions.  Craig Donohoe, our in-house closer, is now able to perform RON closings for any lender, realtor, borrower or seller who would like the opportunity to sign their documents in the comfort of their homes or businesses, not only to avoid social contact at this time, but also in the future for convenience, speed and efficiency that has not previously existed in our industry.  We also have a second dedicated outside e-notary, Ted Dahmus, who is committed to priority e-closings for Ivy Pointe Title.

For more information on how to place your RON title and closing order, please contact Rick Turner (513.943.5660).

Federal Employment Law: Guidance on Emergency FMLA and Paid Sick Leave Released

Author By Matthew S. OkiishiPosted on
Attorney Matthew S. Okiishi

On April 6, 2020, the Department of Labor published its temporary rules for the Families First Coronavirus Response Act (“FFCRA”). Our firm has written prior entries regarding the FFCRA and Covid-19’s impact on the workplace, and I previously noted that a significant portion of the FFCRA would require additional federal guidance to understand. The rules define qualifying reasons for leave, employer and employee notice obligations, and the small business exemption.

Key Definitions

Under the new rules, a “Child Care Provider” is a provider who receives compensation for providing child care services on a regular basis and is licensed under state law. However, a Child Care Provider does not need to be compensated or licensed if they are a family member or friend who “regularly cares for the employee’s child.”

“Place of Care” means the physical location where care is provided for the Employee’s child while the employee works for the employer.

“Son or Daughter” includes biological, adopted, and foster children. It also includes stepchildren, legal wards, or the child of a person standing in loco parentis. Son or Daughter can also include persons over the age of 18 when that person is incapable of self-care because of a mental or physical disability.

“Subject to a quarantine or isolation order” includes the “shelter in place” or other general orders issued by states and municipalities in response to the Covid-19 epidemic, and includes when a governmental authority has advised certain categories of citizens to shelter in place.

Application to Emergency FMLA Leave

The qualifying reason for Emergency FMLA leave is narrow, applying only to employees who are unable to work or telework due to the need to care for a Son or Daughter if the child’s school or Place of Care is closed or the Child Care Provider is unavailable due to the Covid-19 pandemic. But as stated previously, the definition of a “Child Care Provider” is quite broad, including family members and other persons who regularly care for a child out of a neighborly or familial bond. Similarly, a “Son or Daughter” includes the full spectrum of children and persons who are regularly under the care of a parent. As such, it would be improper for an employer to deny EFMLA leave to an employee because the child is not necessarily a biological relative or the Child Care Provider is not a licensed day care.

Paid Sick Leave Implications

The six reasons for paid sick leave have also been impacted by the new regulations:

1. Subject to a federal, state or local quarantine or isolation order related to COVID-19.

Employees are only considered to be “subject to a quarantine or isolation order” when, but for being subject to the order, they would be able to perform work that is otherwise allowed by their employer. When the order shuts down the employer’s operations, an employee is not entitled to paid sick leave.

2. Advised by a health care provider to self-quarantine due to COVID-19 concerns.

A health care provider has advised self-quarantine only when the advice is based on a belief that the employee (1) has Covid-19; may have Covid-19, or the employee is particularly vulnerable to Covid-19 and (2) this advice prevents the employee from being able to work at the employer’s workplace or through telework.

3. Experiencing COVID-19 symptoms and seeking medical diagnosis.

The employee must be experiencing a fever, dry cough, shortness of breath, or any other recognized Covid-19 symptom from the CDC, and must be seeking a medical diagnosis. Paid sick leave under this reason is limited to the time the employee is unable to work because of their affirmative steps to obtain the diagnosis.

4. Caring for an individual subject to a federal, state or local quarantine or isolation order or advised by a health care provider to self-quarantine due to COVID-19 concerns.

“Individual” is an immediate family member, person who regularly resides in the employee’s home, or a similar person with whom the employee has a relationship that creates an expectation that the employee would care for them. Employees may only take leave under this reason if, but for a need to care for the individual, the Employee would be able to perform work for their employer at the workplace or through telework.

5. Caring for the employee’s child if the child’s school or place of care is closed or the child’s care provider is unavailable due to public health emergency; or

Subject to the same EFMLA definitions, an employee may only utilize this reason if no other suitable person is available to care for the Son or Daughter during the period of such leave.

6. Experiencing any other substantially similar condition specified by the Secretary of Health and Human Services (“HHS”) in consultation with the Secretary of the Treasury and the Secretary of Labor.

At the time of this posting, it does not appear that HHS has provided other “substantially similar conditions.”

Intermittent leave and Notice

Employees may only take intermittent leave under the FFRCA’s Emergency FMLA or paid sick leave provisions when the employer agrees. However, an employer may be required to grant “intermittent” leave when an employee is actively seeking a medical diagnosis, as doctor’s visits typically require employees to leave their worksite or telework desk.

Because of the rapid development of Covid-19 symptoms and an employee’s need for leave, the Department of Labor is not requiring employees to notify employers about their need for emergency FMLA or paid sick leave as soon as practicable. Instead, the Department generally advises employers to be proactive in notifying employees of the failure to give notice and an opportunity to provide documentation prior to denying the request for leave. Notice may only be required after the first workday where the employee takes EFMLA or paid sick leave.

From a content perspective, it is reasonable for an employer to require enough information to determine whether the requested leave is covered. This documentation is generally limited to: (1) the employee’s name; (2) dates for which leave is requested; (3) qualifying reason; and (4) a statement (oral or written) that the employee is unable to work because of the qualified reason for leave. For specific reasons, such as quarantine, doctor’s orders, or care for a child, additional documentation may be required. Employers are also permitted to seek information that is needed to support tax credits pursuant to the FFCRA.

Small Business Exemption

Employers with less than 50 employees may be exempt from providing paid sick leave or emergency FMLA leave when the imposition of such requirements would “jeopardize the viability of the business as a going concern.” An employer is entitled to this exemption when an authorized officer has determined that:

  1. The leave requested would result in the business’s expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity;
  2. The absence of the employee or employees requesting leave would entail a substantial risk to the financial health or operational capabilities of the business because of their specialized skills, knowledge of the business or responsibilities; or
  3. There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services by the employee or employees requesting leave and these labor or services are needed for the small business to operate at a minimal capacity.

Small businesses must document an exemption determination internally and maintain the records in its files.

Conclusion

The FFRCA has changed the way business is done in this country, albeit on a temporary basis (The FFRCA sunsets on December 31, 2020). In approaching requests for leave, the law and regulations contemplate that employers will engage in a thoughtful and well-documented manner and avoid knee-jerk reactions or blanket assertions of “business viability.” Employers of all sizes would be well-served to engage competent legal counsel to assist in navigating the FFRCA’s new requirements.

The Finney Law Firm’s labor and employment attorneys are well-versed in the rights and obligations of both employers and employees, including the rapidly evolving COVID-19 changes. For assistance with these matters, consult  Matthew S. Okiishi (513.943.6659) and Stephen E. Imm (513.943.5678).

Paycheck Protection Program: Wells Fargo stops accepting applications

Author By Christopher P. FinneyPosted on

The Payroll Protection Program (“PPP”) is easily the most generous small business support grant/loan program in the history of the nation.  Essentially, it is a lifeline to hundreds of thousands of small businesses (under 500 employees) nationwide in the midst of the economic crisis borne out of the COVID-19 pandemic.

It launched Friday, April 3, 2020, and on Sunday April 5, Wells Fargo & Company announced that it has “reached its capacity of $10 billion to lend under the PPP.” According to FastCompany.Com, “the bank has only been focusing on nonprofits or companies with 50 employees or less,” the statement read. From Fast Company and Wells:

“Given the exceptionally high volume of requests we have already received, we will not be able to accept any additional requests for a loan through the Paycheck Protection Program. We will review all expressions of interest submitted by customers via our online form through April 5 and provide updates in the coming days.”

Many of our clients have wanted to apply quickly to be “first in line” for the grants, and successfully completed their on-line application with various banks.  We have helped them to quickly apply, but generally counseled patience inasmuch as the program claims to extend through the end of 2020.  Thus, we did not expect the grant/loan program would be cut off so quickly and callously by one of the nation’s biggest lenders.  48 hours of applications, which really was about eight business hours, and “poof” they are out of the game and leave their regular customers hanging.

To make matters worse, most banks with which we speak say they are limiting PPP applications to existing customers only. So, Wells Fargo customers may need to either wait or flail around for days, weeks or months to find another lender to process their perfectly compliant PPP application.

We continue to work with clients who are continuing to process PPP applications with PNC, US Bank, Fifth Third Bank, Huntington Bank and other major and smaller lenders.  If you are a Wells Fargo customer who is having difficulties applying for a PPP loan, contact us to help identify a cooperative and open lender.

Attorney Rebecca L. Simpson of the Finney Law Firm has carefully studied the PPP and the Emergency Income Disaster Loans (“EIDL”) to help our small business clients access these funds.  Feel free to call her at 513.797.2856 if you have questions about these programs or need help accessing PPP or EIDL funds.

Stay safe, America. We will get through this together.

Paycheck Protection Plan: 4/2/20 Finney Law Firm/Empower U Webinar is posted here

Author By Christopher P. FinneyPosted on 1 Comment on Paycheck Protection Plan: 4/2/20 Finney Law Firm/Empower U Webinar is posted here

We thank Empower U for hosting a Zoom.Us webinar on the Small Business Administration’s new Paycheck Protection Plan (“PPP”) and Emergency Income Disaster Loans (“EIDL”) designed to help small businesses sustain through the unprecedented economic interruption brought on by the COVID-19 pandemic crisis.  The session was held on April 2, 2020 entirely virtual to remain safe.

The webinar video link is here.  Please feel free to share it with others.

The attorneys on this presentation and their contact information are;

Finney Law Firm is offering individualized assistance in navigating regulations and procedures surrounding PPP and EIDL applications.  For professional assistance, contact Rebecca L. Simpson.  If you or your business is encountering employment-related issues arising from the COVID-19 crisis, contact Stephen E. Imm.

If you liked this free video, please consider donating to EmpowerUOhio.Org to encourage this free programming.  Empower U has given more than 400 free adult education programs over the past decade, including valuable programming of this type.

There is a powerful feeling that the community is pulling together, rooting for one another, and digging deep to help each other, and we hope this information is helpful towards that end.

Also, we will continue to update the Finney Law Form blog to provide individuals and small businesses information on the programs that are available to help them through this crisis.

If you want to be added to the Finney Law Firm email updates, click here.

Ohio Commercial Leasing: Governor DeWine issues Executive Order on commercial leases and foreclosures

Author By Christopher P. FinneyPosted on

In response to the COVID-19 pandemic crisis gripping the nation, today Ohio Governor Mike DeWine issued an executive order addressing commercial leases and commercial mortgages in Ohio.  However, from our perspective, the Order is not intended to have any binding effect, and he would have no authority under Ohio law to issue such a binding order if he so desired.

Here are the components of the order, each of which he labels as a “request,” not an Order at all:

  • Requesting that landlords suspend commercial lease payments for at least 90 days for “small business commercial tenants in the State of Ohio that are facing financial hardship due to the COVID-19 pandemic.”
  • Requesting that landlords also provide a moratorium on evictions of small business commercial tenants for a term of at least 90 consecutive days.
  • Requesting that mortgage lenders of Ohio-based properties forbear on collection or enforcement of such mortgage for a period of at least 90 days.

As with our prior blog on the stay-at-home Order, the Order does not seem to have any direct legal effect, but rather is designed to encourage restraint and cooperation in this difficult time all of the world is encountering.

A copy of the Order is linked here.

Federal Employment Law: Employers must post Notice of Employee Rights under the Families First Coronavirus Response Act

Author By Christopher P. FinneyPosted on

The recently enacted Families First Coronavirus Response Act requires employers to provide their employees with paid sick leave and expanded family and medical leave for specified reasons related to COVID-19. We recently blogged about the Act here.

These provisions will apply from April 1, 2020 through December 31, 2020. The US Department of Labor has issued a poster that employers are required to post in a conspicuous place, or make available to their employees on line. Here is a link to the poster:

The rapidity with which these laws have been passed and gone into effect is unprecedented in the field of employment law. If you have any questions or concerns about your rights and responsibilities under the Act, or regarding the posting of the required Notice, please feel free to reach out to us.

 

Free webinar tonight at EmpowerU on Paycheck Protection Program. Sign up here.

Author By Christopher P. FinneyPosted on

Join Empower U tonight from the comfort and safety of your home via your laptop, tablet or cell phone for a webinar on powerful tools for small business from the federal government in the CARES Act passed last Friday.

>>> The link to sign up for the free seminar is here. <<<

  • If you want to email questions in advance, click here.
  • For specialized assistance for your company, we are offering consultation through the program for a flat $1,500 fee to help businesses through the process.  Click here to get signed up and type “PPP” in the subject line of the email.
  • To have your email to be added to our firm mailing list and receive tonight’s PowerPoint, click here and say “add me to your list” in the subject line.

Joining us tonight are:

  • Attorney Rebecca L. Simpson who will lead the presentation primarily on Paycheck Protection Program and Economic Injury Disaster Loans available very shortly  to small businesses.
  • Attorney Stephen E. Imm who will answer questions of employers and employees about the COVID-19 crisis.
  • Melissa Knies from US Bank who will explain how to apply for the programs.
  • Attorney Christopher P. Finney will moderate.

We have a record audience for Empower U signed up for tonight. Please join us for this important program.

 

Important News for Small Business Owners >>> Critical and significant relief is here for any business with under 500 employees

Author By Christopher P. FinneyPosted on

You will soon hear the terms SBA 7(a) program and “Payroll Protection Program” as an important and significant program to help virtually every small business in the nation.

While labeled as a “loan program,” it in fact can operate as a generous grant program for any business or non-profit under 500 employees. The “loan” is 2.5 times your monthly payroll expenses. More details are available in this article from National Law Review.

Here are the key features:

  • You apply for a “loan” through an SBA-approved lender. Here is the SBA link to Cincinnati-Area approved lenders.  The Cincinnati-area list is very short: US Bank, Fifth Third Bank, The Huntington National Bank, First Financial Bank, PNC Bank, Center Bank and People’s Bank from Marietta.
  • The “loan” is in an amount that is 2.5 times your monthly business’ payroll, being the monthly average over the 12 months prior to the date the loan is made.
  • The “loan” is in a maximum amount of no more than $10 million.
  • The “loan” has no fees associated with it.
  • The “loan” requires no personal guarantees.
  • The “loan” requires no collateral.
  • The “loan” does not require proof that funds cannot be received elsewhere.
  • The “loan” has a simplified application process.
  • The “loan” will be funded quickly to avoid the economic impact of the COVID-19 crisis.
  • Most importantly, borrowers are eligible for loan forgiveness equivalent to the sum spent on covered expenses during the eight-week period after the loan is originated. 
  • Covered expenses include wages, benefits, rent, mortgage payments, and utility charges.
  • The “loan” is forgiven if you maintain your pre-crisis level of full-time equivalent employees for eight weeks after the loan is made.
  • If you fall below that level of employment, your loan forgiveness is reduced in proportion to the reduction in headcount. The same applies to salary reductions.
  • If you already have made staffing reductions, you qualify for loan forgiveness if you re-hire back to pre-crisis levels by June 30, 2020.
  • You do not need to demonstrate actual economic harm in order to qualify. Rather, you simply need to make a series of good faith certifications, primarily that (a) current economic conditions necessitate the loan to support ongoing business operations, and (b) that the funds will be used to maintain payroll and address other covered expenses.

In order to apply, you need to contact an SBA-approved lender Qualified SBA lenders are awaiting further instruction from the SBA.  Contact your lender to get on their email list to obtain application instructions as they become available.  We will update this BLOG as new information is forthcoming.

Here is an excellent article explaining the Payroll Protection Program from Inc. Magazine.

You may contact attorney Christopher Finney (513.943.6655 (o) or 513.720.2996 (c)) at any time for more information.

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