News

Rep. Faison Files Bill Aimed at Ending Private Prison Usage in State

Rep. Jeremy Faison, R-Crosby, has filed legislation taking aim at private prison usage in Tennessee, according to the Tennessean. SB1585 proposes an amendment to TCA Title 41, Chapter 24, prohibiting contracts for the operation of prison facilities from containing occupancy level guarantees, in which the state promises to keep its prison at 90 percent capacity or pay the contractor as though the prison were 90 percent full even if it's not. Private prison opponents argue that these guarantees act as a monetary incentive for states to keep prisons full.
 
Faison predicts the bill will be hotly contested, as Tennessee is home to the second largest private corrections company in the United States, CoreCivic, formerly Corrections Corporation of America. The spokesman for the company, Amanda Gilchrist, recently told the Tennessean that "fewer than half of our contracts include such a provision. Those contracts that include a guarantee ensure our government partners that sufficient space to safely and securely house their offenders in the facility is available to them." 
 
CoreCivic has long been the center of controversy, most recently because of a report from the state Comptroller’s Office, which cites inadequate staffing and supervision of inmates, both persistent problems for the beleaguered corporation. "The U.S. Constitution says that government is supposed to carry out justice," said Faison. "Our Tennessee state Constitution says that government is supposed to carry out justice, not, 'somebody who’s trying to make money gets to carry out justice.' That's crazy."
 
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SCOTUS Grants Review of SEC Judicial Appointment Process

The U.S. Supreme Court on Friday accepted a challenge to the appointment process for administrative law judges at the Securities and Exchange Commission, the ABA Journal reports. SEC judges are selected by the chief judge and approved by the SEC personnel office. Lucia v. SEC questions whether the judges are actually “inferior officers” under the appointments clause and subject to appointment by the president, the head of a federal agency or a court. 
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Tape in Trial of Former Pilot Flying J President Include Racist Comments

Secret recordings of former Pilot Flying J President Mark Hazelwood featured derogatory comments, including racial epithets, Knoxnews reported from trial testimony yesterday. Hazelwood was recorded secretly at a meeting for company executives in 2012. On the recordings played for jurors, he was heard requesting an explicitly racist song, and singing along to the words with his colleagues. Hazelwood and other executives are on trial for wire fraud and conspiracy charges in connection with a scheme to rip off smaller trucking companies.
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Waller’s Nashville Office Hires Hospitality Team from Bone

The Nashville office of Waller Lansden Dortch & Davis LLP has hired a whole team of retail and hospitality attorneys from another prominent firm, the Nashville Business Journal reports. William Cheek, Robert Pinson, Olatayo Atanda and Kimberly Faye all departed Bone McAllester Norton PLLC for Waller. Cheek is known for his work in alcoholic beverage law, and is a founding member of the Alliance of Alcohol Industry Attorneys and Consultants.
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Court Extends Business Court Pilot Project

The Tennessee Supreme Court released an order Friday to continue the business court docket pilot project, following recommendations from its Business Court Docket Advisory Commission. Since its founding in 2015, 129 cases have been transferred to the specialized docket with litigants ranging from large, national companies to small businesses. “This specialized court model provides the judicial branch with the opportunity to focus on what is often very complex and time-consuming litigation and provides efficient and effective outcomes for business owners when there is an issue,” Gov. Bill Haslam said of the project. Effective Jan. 1, the court will assign cases transferred to the business court docket to Judge Joseph P. Binkley of the 20th Judicial District. Cases transferred prior to Jan. 1, shall remain assigned to Davidson County Chancery Court Part III.
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Nashville Healthcare Company Finalizes $31 Million DOJ Settlement

Executives with Nashville-based Envision Healthcare have signed a settlement with the U.S. Department of Justice to resolve a government investigation into allegations that it potentially worked to unnecessarily boost admissions at hospitals in several states. The Nashville Post reports that the alleged impropriety occurred between the company’s EmCare division and hospitals managed by Health Management Associates. The company will pay $31.3 million to resolve the claims and avoid further litigation.
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Prosecutors Say Bookkeeper for Christian Group Stole $394K

The bookkeeper for Titus International, a Christian organization based in Chattanooga, stole $394,000 from the group, Chattanoogan.com reports. Gwen Lively has agreed to plead guilty to bank fraud and aggravated identity theft. She had been with Titus since 2010, and federal prosecutors accused her of beginning the scheme shortly after she joined. She used two methods to defraud the group: transferring funds from the Titus account into one controlled by her, and using pre-signed checks with the director’s name to make them payable to herself.
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Pilot Flying J Trial: Former President on Tape Making ‘Inflammatory Racial Epithets’

As a part of an investigation into the Pilot Flying J fraud scandal, former president Mark Hazelwood was captured on tape making what a judge called “vile, despicable, inflammatory racial” comments, Knoxnews reports. U.S. District Judge Curtis Collier said that if the tapes had been made public while Hazelwood was still president, black employees who had been fired would have cause to sue. Collier said he will allow the recordings to be heard by the jury in the case against Hazelwood and three other former employees.
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December Issue Covers Pirates, Trusts, Banks and Shopping for Toys

Glasby's Fortune by Brentwood lawyer James H. Drescher, a novel about a pirate, is reviewed by the Tennessee Bar Journal's resident "pirate law scholar" Russell Fowler in the December issue. Columnist Eddy R. Smith asks if most trusts should last indefinitely, and Kathryn Reed Edge explains the phases of banking law: good economic times, recessionary times ... and "wedding season." Humor columnist Bill Haltom reminisces over Christmases Past. The bankruptcy of Toys 'R' Us has him feeling guilty for not shopping there anymore now that his kids are grown.

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Tennessee Uniform Limited Partnership Act of 2017

Attorneys Lee Popkin and Thomas Norris Jr. address the Tennessee Uniform Limited Partnership Act of 2017, which will apply to all new limited partnerships formed on or after Jan. 1, 2018, and limited partnerships created before Jan. 1, 2018, that elected to be covered under the new Act. This one-hour webcast will be replayed Dec. 22 at 3 p.m. and is also available on demand.

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Lawsuit to Challenge Nashville Home Business Ban

Nashville record producer Lij Shaw and cosmetologist Pat Raynor are suing the Metro Nashville government to challenge a ban on home businesses, The Tennessean reports. Both Shaw and Raynor previously saw special zoning exemption applications for their small in-home businesses denied by the Metro Council this year. The council has attempted to change the ban multiple times over the years, but neighborhood advocates have argued that home businesses create nuisances, such as noise, and take up street parking.

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Haslam Identified on Secret Pilot Flying J Recording

In the trial of Pilot Flying J executives accused of a scheme to rip off small trucking companies, the subject has turned to whether CEO Jimmy Haslam knew of the dealings, Knoxnews reports. For the first time, Haslam was identified as one of the participants in a conversation that was secretly recorded and included references to the name “Manuel,” which has been shown in testimony as a code word for the fraud.

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Tennessee Supreme Court Answers Question from Federal Court on Collection of Airplane Repair Bill

The Tennessee Supreme Court addressed a certified question from a federal district court on an aircraft maintenance company’s effort to collect a bill for work done on a commercial airplane. Nashville-based Embraer Aircraft Services performed maintenance work on a plane leased by Colgan Air but owned by AeroCentury Corporation. Embraer acquired a repairman’s lein on a the plane itself in case of nonpayment. Colgan never paid after the work was completed, and later went bankrupt. Embraer then filed a lawsuit against AeroCentury in effort to collect the money owed. The federal district court handling the case asked the Tennessee Supreme Court whether a repairman’s lien under the statute can be enforced by a method other than allowing the creditor to take possession of the property and sell it to pay the debt. The Supreme Court held that it only allows creditors to enforce a repairman’s lien by sale of the lien-subject property, which in this case, is the airplane.

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AT&T, Time Warner Merger Sets Stage for Antitrust Lawsuit

The Justice Department might seek to block a planned merger between AT&T and Time Warner, setting the stage for “the antitrust case of the decade,” The New York Times reports. The DOJ demanded that AT&T sell either DirecTV or Turner Broadcasting to gain approval for the deal. Antitrust professor at the University of Tennessee College of Law Maurice Stucke noted that there has been a growing sense that antitrust enforcement has been too lenient in recent years.
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Transactional Practice CLE in Memphis Tomorrow

CLE on transactional practice will be held tomorrow at the University of Memphis FedEx Institute of Technology. Sessions will provide lawyers with the information, tools and tips needed to successfully handle transactional, business and probate matters. Speakers will cover practical approaches for handling mergers and acquisitions, real estate transactions and title concerns.  
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Pilot Flying J Fraud Conspiracy Trial Postponed

A federal judge has delayed the upcoming trial of four former Pilot Flying J executives charged in a scam to defraud trucking firms, the Knoxville News Sentinel reports. The trial will now begin on Nov. 6. The entry revealing the trial delay is labeled as a “notice of hearing,” however, no such hearing notice appeared on the publicly available docket.
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CLE Webcast on Principles of Practice: Business Law

Joan Heminway, William Kent and Taylor Wirth are presenting an online CLE on the basics of business law for Tennessee practitioners. Topics will include common pitfalls, what issues are likely to end up in court, challenges and rewards, and additional practice pointers. If you are unavailable to attend at 3 p.m. on Nov. 14, the webcast will be available online for up to one year.

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Global & Tennessee Specific Trade & Investment Perspectives & Policies for 2018 & Beyond

 
The International Law Section of the Tennessee Bar Association is sponsoring a free seminar “Global & Tennessee Specific Trade & Investment Perspectives & Policies for 2018 & Beyond” to be held on Thursday, Nov. 2 from 6:00 p.m. – 7:30 p.m. at Nashville School of Law, Appellate Courtroom, 4013 Armory Oaks Drive, Nashville, Tenn. 
 
The speakers on the panel include:
  • Terry Olsen, Chair of the TBA International Law Section, as Moderator
  • Clay Banks, Regional Director of Tennessee Department of Economic & Community Development
  • James Forde, Prosperity and Economics Officer of British Consulate General, Atlanta
  • Ms. Joanne Chu, Director of Hong Kong Economic and Trade Office (New York)
  • Mr. Michael Kwan, Deputy Director of Hong Kong Economic and Trade Office (New York)
The seminar will provide an overview of the global & U.S. trade & investment landscape as it concerns Tennessee for 2018 & beyond, and both policy & legal views of the ever-changing global standard of Tennessee in the international investment environment.
 
Attendees will also have the opportunity to have direct interactive discussions with the speakers at the end of the seminar.
 
The panel discussion will last from 6pm thru 7pm, and then followed with a FAQ session for attendees, along with a light reception of beverage & desserts. 
 
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Pinnacle, First Tennessee Resolve Legal Battle

Nashville-based Pinnacle Financial Partners and Memphis-based First Tennessee Bank have ended their long-standing legal feud over recruitment, the Nashville Business Journal reports. It is unknown at this time whether Pinnacle paid any damages. The dispute began when First Tennessee sued a former employee who had defected to Pinnacle, shortly after Pinnacle entered the Memphis market, alleging that he recruited his former coworkers to Pinnacle while still employed by First Tennessee.
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Tenn. AG: Nearly Half of Tennessee Residents Affected by Equifax Breach

In a letter to Equifax, the Tennessee Attorney General’s Office revealed that more than 3 million residents had personal information stolen through the company’s data breach, The Tennessean reports. In a news release, Attorney General Herbert Slatery called the breach “distressing” and said that while it is important for consumers to monitor their financial accounts, Equifax must “actively assist” consumers in doing so. He also advised Equifax to extend the free credit freezes past the current Nov. 21 deadline.
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Chatbot Allows Users to Sue Equifax Without Lawyer

Legal chatbot DoNotPay is now allowing users to file suits against credit-reporting agency Equifax, in light of last week’s news of a massive data breach, the ABA Journal reports. The online platform can help file negligence claims by walking users through a set of questions that generates a PDF they can file in small claims court. The service is free and available to the public in all 50 states. "It is particularly exciting that a lawyer is never needed in the process," Joshua Browder of DoNotPay said. "The class action lawsuit against the company will only give successful consumers around $500 (with the rest going to greedy lawyers in commissions). I hope that my product will replace those lawyers, and, with enough success, bankrupt Equifax.”

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CLE Transactional Practice Memphis

A CLE on transactional practice will be held at the University of Memphis FedEx Institute of Technology on Oct. 27. Sessions will provide lawyers with the information, tools and tips needed to successfully handle transactional, business and probate matters. Speakers will cover practical approaches for handling mergers and acquisitions, real estate transactions and title concerns.

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Class Action Suit Filed Over Equifax Data Breach

Following a data breach that may have affected 143 million people, a class action lawsuit has been filed against credit-reporting agency Equifax, the ABA Journal reports. Mary McHill of Portland, Oregon, and Brook Reinhard of Eugene, Oregon, filed the suit in federal court yesterday. The breach exposed names, Social Security numbers, birth dates, driver’s license data and addresses. 209,000 people also had their credit card numbers hacked. 
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Counsel on Call Acquires Nashville E-Discovery Firm

Brentwood-based Counsel On Call, an on-demand legal services company, has bought Nashville based DSicovery LLC (DSi), which offers digital forensics and e-discovery services, the Nashville Business Journal reports. Counsel On Call will operate DSi out of its current Nashville officers. Both companies will continue to conduct business under their current names.
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Former CEO, Legislator Gets 21 Years, Ordered to Pay $21 Million

A former CEO and Tennessee state legislator was sentenced today to 21 years in prison for his role in a financial scheme, the Commercial Appeal reports. Larry Bates, alongside his sons and daughter-in-law, was convicted in a precious metals Ponzi scheme that impacted more than 360 people. Bates was ordered to pay more than $21 million in restitution. 
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