News

Federal Court Blocks Sysco, US Foods Merger

The U.S. District Court for the District of Columbia issued an order temporarily blocking the merger of Sysco and US Foods earlier this week. The order states that a preliminary injunction is in the public interest as there “is a reasonable probability that the proposed merger will substantially impair competition.” Tennessee, along with 10 other states, joined the Federal Trade Commission (FTC) in seeking the order and preliminary injunction until an FTC administrative hearing is held on July 21. Read more from the Tennessee Attorney General’s office.

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Revenue Department Redesigns, Updates Website

The Tennessee Department of Revenue launched a redesigned website this week featuring a more streamlined and modern look. The tax section of the site also has been updated to include tax rulings, notices, compliance information and statistics.

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Learn More about Nashville’s New Business Court

The Tennessee Supreme Court’s pilot Business Court opened May 1 in Davidson County. Presiding Chancellor Ellen Hobbs Lyle and staff attorney Justin Seamon shared the “how-to” about the process and operations of the court during a one-hour webcast that is now available for replay. The course will remain live on the TBA CLE website for one year. Learn more about the business court in this announcement from the court or watch the webcast now. 

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Court Upholds Arbitration Deal with Foreclosure Exception

The Tennessee Supreme Court has reversed trial and appellate court findings that an arbitration agreement between a purchaser and homebuilder was unfair and unenforceable. The purchaser had argued that the agreement was unfairly one-sided in favor of the homebuilder because it required both parties to arbitrate disputes but allowed the homebuilder to file foreclosure proceedings in court. The Supreme Court disagreed, finding that the agreement applied equally to both parties and the exception for foreclosures was a narrow and reasonable one. The court also found there was a reasonable business justification for the exception, and the circumstances surrounding the contract were not overly one-sided or unfair. Read the full opinion on the AOC website.

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Nashville Judge Throws Out Athletes’ ‘Pay for Play’ Case

A federal judge has dismissed a lawsuit brought by 10 former college football and basketball players who alleged their images were improperly used without their permission by broadcast networks and eight NCAA conferences, the Tennessean reports. Chief District Judge Kevin H. Sharp ruled in Nashville yesterday that the players' claims that they were entitled to monetary compensation because they played in televised games do not represent a sufficient case. The ruling, however, runs counter to the findings in a similar California case and likely sets the stage for consideration by multiple appeals courts according to observers.

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Chattanooga Paper Picks up Business Liability Story

The Chattanooga Times Free Press today picked up the ongoing story regarding the TBA’s rebuttal of a Nashville Business Journal article penned by Nashville lawyer Keith Dennen. In the Business Journal piece, Dennen claims that recent amendments to the Business Corporation Act make "directors of a corporation personally liable for the debts of a business in the event it fails." "He's wrong," said TBA Executive Director Allan Ramsaur in an interview this week. "The bill only applies to dissolved corporations. We've been tracking this and been trying to get in touch" with Dennen. Ramsaur said the proposal came from the bar association as part of a multi-faceted update to state corporation laws and "came through a very careful process at TBA."

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TBA Rebuts Claims About Liability of Corporate Directors

TBA leaders today issued a rebuttal to a guest column published yesterday in the Nashville Business Journal, which claimed that recent amendments to the Business Corporation Act make "directors of a corporation personally liable for the debts of a business in the event it fails.” Members of the TBA Business Law Section, which helped craft the amendments, counter that the changes will not have any of the adverse effects predicted, and in fact, the addition of liability protection for directors dissolving a corporation will create a positive environment to incorporate a Tennessee business or serve as director of a Tennessee corporation.

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No Concerns About New Corporate Director Liability Under Recent Business Corporation Act Amendment

A news account published Monday has suggested that legislation, Public Chapter 60, proposed by the Tennessee Bar Association Business Entity Committee and enacted this spring by the General Assembly, has made corporate directors personally liable for creditors’ claims in the event of a business failure. A unanimous consensus has emerged within the leadership of the TBA Business Law Section that the provision in question does not have that adverse effect and, in fact, provides certain safe harbor protection for directors of a dissolving corporation. The provision in the recent amendment to the Business Corporation Act is adopted verbatim from the Model Business Corporation Act and has been enacted in at least 10 other states without known controversy or negative impact on corporate directors. 

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First Tennessee to Pay Government $212.5 Million

First Tennessee Bank has agreed to pay $212.5 million after admitting to making bad mortgage loans. According to the U.S. Justice Department, the bank kept approving Federal Housing Administration loans for ineligible borrowers through its subsidiary, First Horizon Home Loans Corporation, between January 2006 and October 2008. When many of those loans later defaulted, the banks holding the loans were able to submit insurance claims to the U.S. Department of Housing and Urban Development for their losses. News Channel 9 has the story.

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June TBJ: Paternity Fraud, Economic Losses, Grad Advice

In this issue, learn how to successfully file a paternity fraud lawsuit by reading an article by Peggy R. Smith. You may also need to know how to calculate economic losses in employment termination cases, which Charles Baum explains. In this graduation season, Andra J. Hedrick writes a letter to herself (and new grads) about what to expect and what she would have done differently. There's a lot more in the June issue -- take a look!

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Court to Review New Civil, Criminal Cases

The Tennessee Supreme Court has granted review to several new cases. Civil issues to be decided include corporate shareholder standing and challenges to charges by utilities. Criminal issue include traffic stop suppression, expired sentences, defective indictments and lesser-included offenses. The Raybin-Perky Hotlist reviews each and offers a prediction on how the cases may be decided.

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Charity Heads to Pay Fraction of Amount Owed

Three operators of phony cancer charities will pay less than one penny on the dollar toward their combined $106 million settlements, Knoxnews reports. The paper also says that investigators will not comment on whether any of them will face criminal charges after spending donations on lavish trips and personal paydays. The reduced settlement is based on their “documented inability to pay,” officials said. The cases likely will have to be resolved in court, Tennessee Secretary of State Tre Hargett said earlier this week.

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AG Announces New Settlement Deals

Tennessee Attorney General Herbert H. Slatery III has announced several settlements on behalf of consumers this month. These include a deal with Sprint and Verizon, which were found to have charged consumers for third-party services they did not authorize; with the nation’s three credit reporting services for inaccuracies in consumer credit reports and the handling of calls disputing credit report information; with RadioShack over the sale of its customers’ personally identifiable information; and with Atmos Energy, which had planned to impose significant hikes in natural gas fees.

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Big Banks Face $2.5 Billion in Fines, Criminal Charges for Rigging Markets

Four big banks will pay $2.5 billion in fines and plead guilty to criminally manipulating the global currency markets going back to 2007, the Associated Press reports. JPMorgan Chase, Citigroup, Barclays and The Royal Bank of Scotland conspired with one another to fix rates on U.S. dollars and euros traded in the huge global market for currencies, according to a settlement announced today between the banks and U.S. Justice Department. Knoxnews has the story.

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HCA National Medical Director Sued for Malpractice

Dr. Michael Murphy, the national medical director for HCA's Behavioral Health Services division, has been named as a defendant in a multi-million dollar medical malpractice suit along with two members of his former practice, the Nashville Post reports. Murphy’s former patient killed his father in the middle of a nervous breakdown. The suit alleges that Murphy failed to adequately transition the patient to two members of Murphy’s practice when he left for his current position with HCA and inappropriately accessed his medical records after he was no longer Murphy’s patient.

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Report: Legal 'Firewalls' Shield Chinese Firms from Suits

Chinese companies are shielding themselves from lawsuits in America, denying U.S. businesses and investors their day in court, a report from a federal watchdog says. The report published Tuesday by the U.S.-China Economic Security Commission and reported by the Associated Press says that Chinese companies operating in the U.S. have built a legal firewall that keeps them largely immune from the jurisdiction of U.S. courts and regulatory agencies.

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Court Enters Interstate Marijuana Dispute

The U.S. Supreme Court on Monday asked for the views of the Obama administration on a dispute between three states over Colorado’s 2012 legalization of marijuana. The action is a sign that the high court may be interested in the dispute, the Blog of Legal Times reports. The suit, brought by the states of Nebraska and Oklahoma, does not challenge the legalization of marijuana but questions the manufacture and sale of the drug across state lines.

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Event to Benefit Legal Assistance for the Arts

The Arts and Business Council of Greater Nashville, in conjunction with the Nashville Bar Association Young Lawyers Division, will host a fundraiser May 27 for the Tennessee Volunteer Lawyers and Professionals for the Arts. The event will take place from 6 to 9 p.m. at the W.O. Smith School. It will include food, live music and a silent auction. Contact Kelly Donley to learn more.

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Court Remands Obamacare Question to 6th Circuit

The U.S. Supreme Court on Monday breathed new life into the religious objections of Catholic groups in Michigan and Tennessee to the Affordable Care Act requirement for contraception coverage in health plans, Reuters reports. The Sixth Circuit Court of Appeals had ruled in favor of the administration’s position in a case that pre-dated the high court’s Hobby Lobby decision. The Supreme Court directed the appeals court to reconsider its decision in light of the June 2014 ruling that allowed certain privately owned corporations to seek exemptions from the provision.

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Nashville Lawyers Launch Online Trademark Service

A trio of Nashville attorneys has launched the online trademark company Trust Tree Legal. The founders -- Bill Ferrell, Randy Michels and Kevin Hartley -- have a combined 30 years of experience in trademark law and patent litigation. The company offers four levels of support ranging in price from $149 to $949 and provides assistance with trademark searches, filing and maintenance; foreign filing; and foreign counterfeits. The trio also offers guidance through a new blog, The Root, the Nashville Business Journal reports.

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Legislative Session Wraps Up

State lawmakers finished their work for the 2015 legislative session just before 10 p.m. last night, the Tennessean reports. Among the bills passed yesterday, lawmakers approved an additional exemption to the Hall tax on investment income, new rules for ride-sharing services like Uber and Lyft, and the use of cannabis oil to treat seizures. Among the bills that failed to advance were measures allowing undocumented immigrants’ children who grew up in Tennessee to pay in-state tuition at public colleges and universities (which lost by one vote), allowing residents of parts of cities to de-annex territory, and banning alcohol sales to people with three or more drunken driving convictions. See a break down of more legislative winners and losers from the Associated Press.

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Business, Legal Leaders Join in Launch of New Court

Tennessee Supreme Court Chief Justice Sharon Lee and Davidson County Chancellor Ellen Hobbs Lyle today launched the state’s first Business Court to a gathering of more than 100 business and legal leaders in Nashville. “Keeping businesses here in Tennessee and bringing in new ventures means more jobs for Tennesseans,” Lee said. “This has long-term benefits and is good for all Tennesseans.” The court is a pilot project that officials hope will be expanded to other cities across the state.

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Bill Eases Creation of For-Profit Corporations

Legislation providing some additional flexibility for the creation of for-profit benefit corporations cleared its last major legislative hurdle this afternoon when the Senate adopted SB972/HB767 as amended. The TBA’s Business Entity Study Committee played a critical role in revising the original proposal so that it conforms more closely to Tennessee law.

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AG Reaches Settlement with Middle Tennessee Auto Dealer

Middle Tennessee auto dealer Wholesale Inc. has agreed to immediately change its advertising practices and pay the State of Tennessee $50,000, Attorney General Herbert H. Slatery III announced today. The state alleged that the defendant made numerous false representations in violation of the Tennessee Consumer Protection Act, including use of a fictitious lender called “CreditAble Auto Funding” claimed to be “by military, for military,” offering a limited amount of loans to military personnel. "Our men and women in uniform deserve to be told the truth when considering a consumer purchase," Slatery said.

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Antitrust Concerns May Block Comcast/Time Warner Deal

The Justice Department’s antitrust division is nearing a recommendation to block Comcast Corp.’s bid to buy Time Warner Cable according to sources, Bloomberg News reports. Attorneys who are investigating Comcast’s $45.2 billion proposal to create a nationwide cable giant are leaning against the merger out of concerns that consumers would be harmed and could submit their review as soon as next week.

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