Survey: 2015 Civil Practice

Michael Anthony Bottar reviews the developments in New York Civil Practice during 2015. Bottar surveys five statutory reforms, material changes to the Office of Court Administration (OCA) rules, and various case law developments under CPLR Articles 2, 3, 5, 9, 10, 20, 21, 23, 30, 31, 32, 40, 50, and 78.

View Full PDF

Michael Anthony Bottar is a graduate of Colgate University and summa cum laude graduate of Syracuse University College of Law, the author is a member of Bottar Leone, P.L.L.C., an adjunct professor at Syracuse University College of Law, and a member of the Syracuse University College of Law Board of Advisors. The author thanks Samantha C. (Robbins) Riggi, Esq., for her extraordinary efforts in connection with this year’s Survey.

Survey: 2015 Business Associations

Sandra S. O’Loughlin and Christopher J. Bonner review developments in New York Business Association law in 2015. Their review focuses on the major changes made to New York’s LLC law, as well as a holding by a bankruptcy court that ex-partners could be held liable for returning compensation paid while the law partnership was insolvent.

View Full PDF

Sandra S. O’Loughlin: Partner, Barclay Damon, L.L.P., Buffalo, New York; Adjunct Professor and Lecturer, University at Buffalo Law School, State University of New York; J.D., State University of New York at Buffalo Law School; B.A., Daemen College; Rosary Hill College.

Christopher J. Bonner: Special Counsel, Barclay Damon, L.L.P., Syracuse, New York; J.D., Harvard Law School; B.A., Williams College.

Survey: 2015 Administrative Law

Rose Mary Bailly and William P. Davies review the developments in New York Administrative Law during 2014–2015. For judicial developments, the authors review: (A) the due process rights of an incapacitated parolee; (B) the deferential weight of agency interpretation of the Environmental Conservation Law; (C) whether an agency decision finding no excess child-support payments were due was arbitrary or capricious; (D) the Court of Appeals’s test for standing in the context of a State Environmental Quality Review (SEQRA); (E) the proper remedy for a violation of the right to call a witness in a prisoner disciplinary case; and (F) the statute of limitations for claims under Section 8 of the Federal Housing Act. Bailly and Davies also discusses executive branch developments, such as (A) the Raise the Age legislation, an act intended to treat older teenagers differently from adults in criminal cases; (B) changes to the regulation of alcohol; (C) an executive order on the Freedom of Information Act; and (D) reforms to the Port Authority.

View Full PDF

Rose Mary Bailly, Esq., is Special Counsel to the Government Law Center of Albany Law School, and an Adjunct Professor of Law at Albany Law School where she teaches New York State Administrative Law, among other courses.

William P. Davies, J.D., Albany Law School 2016. He was an Executive Editor for Notes & Comments on the Albany Law Review, Volume 79. He was also the Senior Student Editor for the NYSBA Government, Law and Policy Journal.

New York State Senate Passes Bill to Accommodate Ride Sharing Apps, but the Assembly Will Not Follow

—by S. Alex Berlucchi

Sources: S.B. 4280, 238th S. Sess., 2015-2016 Reg. Sess. (N.Y. 2016); Mike McAndrew, Senate Passes Uber in Upstate NY Bill, but Assembly Expected to Balk, Syracuse.com, 1, 1 (June 17, 2016) http://www.syracuse.com/state/index.ssf/2016/06/senate_passes_uber_in_upstate_ny_bill_but_assemby_expected_to_balk.html

Abstract:  The New York State Senate passed a bill to allow “transportation network companies,” such as Uber and Lyft, to operate in areas of New York State outside of New York City.  Presently, concerns for the safety of the passengers and the insurance requirements for the drivers are causing debate within both the Senate and the Assembly.  While this bill passed in the Senate, it is not likely to pass in the Assembly.  Facing political pressure from Governor Andrew Cuomo, a resolution to the prohibition of ride-booking companies is imminent.

***

The New York State Senate passed a bill allowing “transportation network companies” such as Uber and Lyft, to operate in New York State.  Currently, these companies are only legally allowed to operate in New York City.  Ride-booking companies received an exception to operate in New York City, and the convenient, trend-setting ride services are advocated as an improved means of public transportation.  While this bill did pass in the Senate, the Assembly is reluctant to follow suit.

Senator James Seward (R-Oneonta) sponsored New York Senate Bill 4280, which passed in the Senate Insurance Committee.  The bill would require a minimum of one million dollars in liability coverage whenever a drive has a “paid passenger in their personal vehicle.”  When there are no riders, the Bill similarly mandates minimum coverage, totaling $200,000.  This minimum is higher than the minimum insurance requirements for taxi cab drivers in local municipalities, such as Utica, thus demonstrating an effort to maintain the current taxi cab industry while allowing “transportation network companies” to spread to other cities in New York.  Furthermore, this Bill allows for local control over all other issues, such as accessibility and requirements to act as an independent contractor.

This bill passed, in the Senate, despite strong opposition from the traditional taxi cab and limousine industry.  Similar to protests seen in New York City, allowing ride-booking companies to operate in cities such as Syracuse, Buffalo, and Rochester will have a detrimental effect on the cab industries in these respective localities.  For example, currently only 200 taxi cab licenses are issued, and all 200 are currently taken.  An influx of transportation options may lead to increased litigation with the taxi cab industry; however, there are two issues with the Bill as presently written.

The first issue is a lack access to “transportation network companies” for individuals with disabilities.  Presently, of the 30,000 independent contracts operating in New York City, there are zero vehicles which are wheelchair accessible.  This will be an issue for passing a law in New York, as the Assembly has placed an emphasis on handicap accessibility, as well as safety of the passengers.

In the Assembly, the parallel bill to New York Senate Bill 4280 includes higher mandatory minimum levels of insurance coverage.  There is also an express need to perform background checks on the drivers, in the interest of public safety, and a mandate for handicap accessibility.  These provisions were not included in the Senate version of the Bill.   Therefore, the Assembly is unlikely to resolve these issues.

This conversation began in the New York State Legislature more than one year ago.  Gov. Andrew Cuomo spoke to the positive aspects of ridesharing, or ride-booking, as a rapidly expanding business.  As a growing aspect of the technology industry, these “digital networks” provide a valuable service both to citizens of New York, and tourists who may be visiting.

Despite the benefit, the State Legislature is divided on the interests of public safety, and the autonomy provided to local governments will still be a barrier in allowing “transportation network companies” to operate.  The Assembly is not likely to pass the current bill as it is written.  In addition, while the Senate focused on insurance minimums to pass the Bill, the Assembly will need to resolve more issues before proposing a Bill which may be duly considered.  Based on the public response, this discussion is unlikely to resolve itself during the current session.

Bill Introduced to Prevent Sex Offenders from Playing Virtual Reality Games

—by Will Kilgore

Sources: S.B. 8174, 238th S. Sess., 2015–2016 Reg. Sess. (N.Y. 2016); N.Y. Penal Law § 65.10 (McKinney 2016).

Abstract: New York Senator Jeffrey Klein introduced Senate Bill 8174 to prohibit sex offenders from accessing augmented reality games, so as to prevent such offenders from congregating in the same real world locations as children engaged in virtual play.

***

On August 3, 2016, New York State Senator Jeffrey Klein introduced Senate Bill 8174 that would amend New York Penal Law Section 65.10 by adding the words “or augmented reality game” into subsection (b) of paragraph 4-a. The justification for Senate Bill 8174 is to prevent unsupervised children and sex offenders from congregating in the same real world locations that the augmented reality game incentivizes players to visit. This proposed legislation came largely in response to the immediate popularity of the augmented reality game Pokémon GO. Senate Bill 8174 is the first proposed legislation, either state or federal, that both recognizes the potential impact of augmented reality games on our culture and attempts to minimize the harm that can occur from playing these types of games.

 

Augmented Reality Games

Augmented reality games, like Pokémon GO, allow players to interact with their real world environment while simultaneously playing the game. For example, in Pokémon GO, the game uses a player’s mobile device camera, GPS, and clock to generate a version of the real world on that device. The purpose of this particular game is to collect creatures that pop up in random real world locations. There are also certain in-game objectives at real world locations, where players can stock up on supplies that are needed for the game or battle their creatures against those of other players. With both children and adults able to play the game, there can be significant risks in allowing unsupervised children to frequent these locations.

 

Current Status of the Law in New York

The subsection that Senate Bill 8174 proposes to amend sets forth mandatory conditions when imposing a sentence of probation or conditional discharge for certain classifications of sex offenders. Those classifications are: sex offenders that perpetrate an offense on victims under age 18, sex offenders that are classified as level three, or sex offenders that used the internet to facilitate the crime. Section 65.10 of New York Penal Law currently prohibits these classifications of sex offenders from: “1) using the internet to access pornographic material; 2) access[ing] a commercial social networking website; or 3) communicat[ing] with other individuals or groups for the purpose of promoting sexual relations with a person under the age of eighteen.” Subsection (b) goes on to define social networking website as:

any business, organization or other entity operating a website that permits persons under eighteen years of age to be registered users for the purpose of establishing personal relationships with other users, where such persons under eighteen years of age may: (i) create web pages or profiles that provide information about themselves where such web pages or profiles are available to the public or to other users; (ii) engage in direct or real time communication with other users, such as a chat room or instant messenger; and (iii) communicate with persons over eighteen years of age.

While Section 65.10 prohibits sex offenders from participating in three distinct activities, and social networking website has a broad definition, augmented reality games are not included in the prohibition.

 

Legislative Pipeline

Currently, Senate Bill 8174 is still in committee. In other words, the proposed legislation still has some distance to go before actually becoming law. The reviewing committee has to decide whether the bill should be sent to the Senate floor for a vote. If the bill passes by a majority in the Senate, then it has to also pass by a majority of the Assembly, and ultimately be signed into law by the Governor.

 

Implications of Senate Bill 8174

If Senate Bill 8174 becomes law, judges will be required to impose this additional condition on the probation or conditional discharge of all of the above-mentioned classifications of sex offenders. Prosecutors and investigators will presumably need to discover new methods to track and prove that a suspect did indeed access an augmented reality game. If a sex offender does access an augmented reality game, it will be the duty of the prosecutor to prove that the individual violated his probation or conditional discharge.

Even though this proposed legislation is still in committee, at the very least it brings awareness to the legislature that augmented reality games are on the market and could have potential negative consequences for consumers. At the very most, it could become law and potentially protect children by prohibiting sex offenders from accessing augmented reality games.

California Passes Bill to Protect Sexual Assault Victims

—by Astrid Quiñones

Source: Sex Crimes: Mandatory Prison Sentence, California, Assembly Bill No. 2888, https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201520160AB2888

Abstract: In response to the Brock Turner case, California enacted legislation to disallow probation and provide a mandatory minimum three-year sentence for defendants convicted of sexually assaulting an unconscious victim.

***

“I do not know your name — but I know that a lot of people failed you [. . .].” – Joe Biden, Vice President of the United States

Stanford rape survivor “Emily Doe” was sexually assaulted by Brock Turner while she was unconscious behind a dumpster. Earlier this year, Turner was convicted of three felonies, including assault with intent to commit rape, penetration of an unconscious person with a foreign object, and penetration of an intoxicated person. However, Turner was sentenced to six months in jail and was released after only serving half of his sentence.

Prior law prohibited a court from granting probation or suspending the execution or imposition of a sentence if a person was convicted of violating specified provisions of the law, including rape by force, pandering, and aggravated sexual assault of a child. But the prior law did not include this prohibition for victims who were unconscious or incapable of providing consent due to intoxication. Thus, the judge had the authority to provide a lenient sentence to Turner.

In response to Turner’s case, California lawmakers proposed legislation to correct this failure. The bill, AB 2888, ends a discrepancy in the California penal code that permits probation for defendants convicted of sexually assaulting an unconscious victim.  Also, it invokes a mandatory minimum three-year prison term for crimes regardless of whether the victim is conscious.

The bill had bipartisan support and quickly passed through the Senate and Assembly, and was signed by California Governor Jerry Brown (D.). However, the bill did not go unopposed. The American Civil Liberties Union and the California Public Defenders Association argued that state law already provided an adequate sentencing scheme. Arguably, changing the sentencing laws was not the appropriate solution to such a serious problem.

In the United States, one in four women are likely to be sexually assaulted in their lifetime. According to RAINN (Rape, Abuse & Incest National Network), the nation’s largest anti-sexual violence organization, out of 344 incidents that are reported to the police, only 6 perpetrators will be incarcerated. The bill reflects the growing awareness of the need to protect women and the need to hold their offenders accountable. The hope is to avoid such injustice from occurring and successfully treat sexual assault victims equally.

Recently Introduced Bill Provides Data Breach Insurance Tax Credit

—by Adam Koulish

H.R. 6032, 114th Cong. (2016) (as referred to H.R. Comm. on Ways and Means, Sept. 14, 2016).

Cybersecurity Framework FAQs Framework Basics, Nat’l Inst. of Standards and Tech. (last visited Sept. 25, 2016), https://www.nist.gov/cyberframework/cybersecurity-framework-faqs-framework-basics.

William H. Latham, Does Your Company’s Data Breach Insurance Coverage Measure Up?, Lexology (Jan. 21, 2016), http://www.lexology.com/library/detail.aspx?g=13ae8c51-5eb8-42f6-8f1c-7e04fa346463.

Abstract: A bill, H.R. 6032, the Data Breach Insurance Act, has recently been introduced to the House Ways and Means Committee. If passed, the bill would allow businesses to claim a tax credit for the purchase of qualified data breach insurance.

***

As data breaches or “hacks” of businesses happen at an increasing rate, the purchase of data breach insurance has become a necessity for businesses of all sizes. In an effort to lessen the burden and incentivize such a purchase, a bill was assigned to the House Committee on Ways and Means on September 14, 2016 that would amend the Internal Revenue Code of 1986 to provide a tax credit to businesses that purchase data breach insurance. H.R. 6032, the Data Breach Insurance Act, would provide a credit amount equal to 15 percent of a business’ aggregate premiums paid or incurred during the taxable year for qualified data breach insurance. Being a recently introduced bill, there is a high likelihood of it being amended before it even reaches the House floor. There is also a distinct possibility that the bill will not be passed.

For the purposes of this bill, qualified data breach insurance is “coverage provided by an insurance company for expenses or losses in connection with the theft, loss, disclosure, inaccessibility, or manipulation of data.” Typically, there are two main types of claims associated with data breach insurance coverage. There are third-party claims such as legal defense if sued by a customer whose data was exposed, and there are first-party claims such as the various IT and public relations responses needed to mitigate the damage of a breach. Ideally, a data breach insurance policy would cover both types.

A business wishing to receive this credit must have adopted the Framework for Improving Critical Infrastructure Cybersecurity (FICIC) as set forth by the National Institute of Standards and Technology or any similar standard prescribed by the Secretary of Homeland Security and the Secretary of Commerce. Simply put, the FICIC is voluntary guidance that helps businesses manage and reduce their cybersecurity risk. It also establishes common terms used in cybersecurity risk management to facilitate easier communication between entities inside and outside the business.

In claiming a credit for qualified data breach insurance, the charge for such insurance should be separately stated from other types of insurance in the contract or specified on a separate statement. Also, the charge for qualified data breach insurance should not be unreasonably large in comparison to the rest of the insurance contract. The premiums paid for this insurance will only qualify for the tax credit “if such premiums are paid or incurred in the ordinary course of the taxpayer’s trade or business.” Although since data breaches can happen to almost any business, this should be an easy requirement to satisfy. Lastly, in its current form, the bill provides for credits claimed in the five years after its passage.