Monthly Archives: May 2015

Antitrust Suit Against Blue Cross and Blue Shield

Healthcare providers, small business, and individuals have filed antitrust lawsuits against Blue Cross and Blue Shield. They allege the 37 independently-owned companies that make up the Blue Cross Blue Shield Association are colluding to avoid competition, raise prices on premiums, and clamp down on payments to providers. Plaintiffs are seeking class action status.

Blue Cross and Blue Shield covers about a third of the nation. In the 1930s, doctors provided insurance under the Blue Shield name and hospitals used Blue Cross. Eventually, the names were trademarked and now companies that use the names operate within an exclusive territory–many in a single state.

According to a Wall Street Journal article, defendant says “its licensing deals simply codify trademark rights that date back decades and ‘do not constitute an agreement to do anything unlawful.'” They claim their model has been around for long time and has withstood government scrutiny. But plaintiffs contend this is cartel-like behavior. The model stifles competition and leads to inflated premiums.

The case will pit antitrust law against trademark rights. Plaintiffs may have a point, especially since at least in one area, California, Blue Cross and Blue Shield plans “compete directly against one another . . . where Anthem Blue Cross battles Blue Shield of California.” That fact appears to cut against defendants’ contention that the deals among licensees are only made to protect trademarks.

A district court judge has declined to dismiss the case, ruling plaintiffs “‘have alleged a viable market-allocation scheme.'”


Companies Tracking Workers With Cell Phones Off-hours May be Violating Their Constitutional Rights

Many companies provide workers with cell phones for company business. And they expect that their workers respect its proper use. But companies should afford their workers the same respect in terms of privacy.

In a recent report, a woman was fired for deleting an app her employer used to track her movements. She sued for invasion of privacy–a concept covered in Business Law class. Her employer used the phone to follow her off-hours, akin to a “‘prisoner’s ankle bracelet.'”

But the employer is not all wrong. As a traveling saleswoman, her employer had an interest in knowing her whereabouts, however, where they crossed the line was continuing to monitor her off-hours. Employees were not permitted to disable any GPS tracking on the phone and they had to keep it on 24/7.

Under the Fourth Amendment of the Constitution, the government is prohibited from invading someone’s privacy without probable cause and a warrant. The present case deals with the private sector, however. The woman probably had no right to delete the app, because it is company property since it is on a company phone; however, she still could have disabled the phone off-hours and not be in any trouble. Under California law, where she lives, employers are prohibited from following her in this manner when she is off-duty. Many other states have the same prohibitions.

One convenient way (and perhaps the woman in this case could have used) of stopping someone from using a cell phone as a GPS tracker is to put the cell phone in the refrigerator. Apparently, that will block the signals coming in and going out.

Italy, US Joint “Operation Columbus” Brings Down Drug Ring Run Out of a Pizzeria

In class, we discuss organized crime and its effects on business and society. Recently, Italian special agents, SCO, and the FBI arrested 13 persons in Calabria, Italy, allegedly connected with the ‘Ndrangheta crime family.

With affiliates in the U.S., the suspects were organizing cocaine shipments out of Costa Rica. Authorities arrested them in the middle of the night while they were sleeping and charged them with conspiracy to run an international drug trafficking ring.

The year-long investigation was named “Operation Columbus” and was jointly-led by federal authorities in Brooklyn and prosecutors in Calabria. Gregorio Gigliotti, an owner of pizza shop named “Cucino A Modo Mio” (I Cook My Way), located in Queens, NY, was arrested along with his wife and son. Italian investigators said they had information that he spearheaded the ring. “The Italian restaurant was the command center for bringing some drug shipments to New York and sending others to Europe or Calabria,” Grassi told reporters in Rome. The suspects allegedly shipped cocaine in crates containing cassava, a South American root vegetable.

According to the article, the ‘Ndrangheta has become Europe’s biggest cocaine dealer and has supplanted the Sicilian mafia as the major partner to the New York crime families.

Fighting a DUI in New Jersey–A Review of Criminal Procedure

In a recent article, expert lawyers in DUI laws revealed how they attack drunk driving charges.  Normally, defense lawyers rely on plea bargaining when a client is charged with a crime. Plea bargaining involves an agreement between a prosecutor and defendant where the defendant will plead to a lesser charge in return for dismissal of other charges or to the original charge in lieu of a lighter sentence. Sometimes it may involve a quid pro quo to the prosecutor for information leading to other crimes. But New Jersey does not allow plea bargaining in DUI cases. As a result, defense lawyers have no choice except to work to dismiss the DUI case entirely or prove the evidence results in a downgrade to a lesser charge.

According to the article, oftentimes, defense lawyers will find a technicality. For example, lawyers will challenge a blood draw (which now under both state and federal law must be preceded by a warrant) by demanding an explanation as to how it was performed. The results can be suppressed if the draw was not done by a physician or nurse, or the area was cleaned with alcohol instead of iodine. Some of the sample must be made available to the defense to conduct their own independent tests; failure to do so may result in suppression.

Blood results corroborated by field sobriety tests is stronger evidence of DUI; however, in cases involving injuries to a driver, field tests are foreclosed, leaving only the blood tests. If challenged, again, the case can be dismissed. Issues can arise from the accident scene itself, which can also result in a dismissal. As stated, warrants are necessary in order to perform a blood draw. According to William Proetta of Edison, a defense lawyer that was interviewed, “[I]f a person doesn’t consent or is unconscious, you need to call in a telephonic warrant. If emergency workers are asking the driver questions, without having Mirandized him, an attorney would argue those statements can’t be used against him.” Telephonic warrants are faster to obtain and are encouraged by the courts.

Breath tests using an Alcotest have a different set of procedures–all of which can be challenged in a suppression motion. Repair and calibration records may be subpoenaed, and failure by the State to do so may result in a dismissal. Officers conducting the test must get two successful readings and change the mouth pieces between each reading. The person must be observed for 20 uninterrupted minutes and cannot regurgitate or vomit, as this will produce a false reading. No cell phones or electronic devices can be present in the room.

Lawyers say there are many other ways to challenge the results. They recommend that people pulled over for a DUI not refuse the test, because refusal is a separate charge. The challenge becomes a little trickier in that they have to show the officer read the driver “the wrong statement” when asking if they will take the test. Also, the driver has to clearly say “No.” not once, but twice, to be considered refusal and ambiguous answers, such as, “‘I don’t know.'” or “‘I want a lawyer.'” are not enough.

Defense lawyers will employ experts, often former police officers who are trained in the Alcotest, to testify as to what the officers should have done. Also, discovery challenges are commonplace. If the prosecutor fails to produce discovery within 30 days, that can result in a dismissal. Dashcam video must produced as well; but that can be a double-edged sword. It can be used to impeach an officer’s testimony, or in the alternative, prove that the defendant in fact could not stand or was slurring his or her words.

A DUI can be proven by an officer’s observations as well, without the aid of other evidence. According to Ernesto Cerimele, a DUI defense lawyer in Newark,

If the officer’s report says the driver reeked of alcohol and admitted to drinking several beers, that still counts . . . . Even if the blood or Alcotest evidence is thrown out, if the officer’s observations of the driver and the ‘totality of the circumstances’ point to a driver being intoxicated, he can still be found guilty. The harder cases to defend against are frequently those where the officer fully documents everything he heard and observed in his police report.

Finally, the case can be dismissed if a trial is delayed beyond 60 days, pursuant to New Jersey Administrative Office of the Courts’ guidelines. Based on hardship, inequity and the right under the Sixth Amendment to a speedy trial, a defense lawyer can move for dismissal if the prosecution does not have his or her case ready in time. In one case cited by the article, a prosecutor was given an extra 30 days to produce discovery and failed. That resulted in an immediate dismissal by the judge.



Amtrak Crash: The Engineer’s Right to Remain Silent

Posted by Daniel Lamas.

Just recently, on May 12 in Philadelphia, an Amtrak train derailed and killed eight people and sent over 200 to the hospital. A question everyone is asking is why the train was going that fast and why it curved. Brandon Bostian, who was the engineer, has agreed to be interviewed and many feel that he will be able to answer some important questions.

Bostian claims that he has no recollection of the accident and denies a lot of claims made about the way he operated the train. It was proven that Bostian was going 106 miles per hour when the train should have only been going at 50 miles per hour. Bostian has refused to talk about that part of the case, as he has a Fifth Amendment right to remain silent, and has only said that by the time he tried to pull the safety brakes, it was too late. Bostian has already gotten a lawyer and is prepared if he is sued. Even though there are not yet any charges against Bostian, he knows that he must prepare himself for what is to come. Mayor Michael Nutter said, “He doesn’t have to be interviewed if he doesn’t want to at this particular stage. . . . That’s kind of how the system works.”

Daniel is a business management and merchandising major at Montclair State University, Class of 2017.

Obama Promotes Benefits of Trade Deals to Workers and Small Businesses

Posted by Shanice Cooper.

On February 15, 2016, in an article by Julie Hirschfield Davis, she details President Obama’s attempts in trying to persuade Congress how important trade is for small business worldwide. The article outlines the importance of small businesses being able to have the global accessibility for trade deals outside of the United States. In hopes of pushing Congress to approve these global trade deals, Obama has been generating various ways to build networking partners to increase business opportunity for more small corporations, such as, “including a series of programs to promote exports from rural areas and help more small and medium-size American businesses sell their goods and services overseas,” says Davis.

In addition to Obama’s local business programs, which allows small businesses to maximize their potential, he has been planning to meet with international firms. The purpose of the meetings will be to have people who have been successful due international trade deals testify to the importance of it: “American workers and businesses have benefited from previous trade deals and stand to gain substantially from pending agreements with Asia and Europe.” Due to the trade deals, much of our everyday living essentials are met. If it was not for Asian or European trade deals would tech remain the same? “Mr. Obama’s team is armed with statistics that it says show that the United States has essentially no choice but to strike trade deals to open more markets to American goods.” However, the only issue the President faces in his attempts to help American business owners are the Congress itself.

While Obama makes a compelling case to the law makers in how the restrictions in international trade is harming American owned businesses, Congress is slowly changing, understanding how strongly the President feels about it. “Getting these trade deals done will benefit our businesses and middle-class workers, not just in rural communities, but across the country,” said Bruce H. Andrews, the Deputy Secretary of Commerce. According to administration officials, they believe the new agreements will help American workers by opening markets to United States products and improving environmental and labor standards around the world. I think it is important for the American economy to be able to continue to negotiate internationally, because we may need it for future generations.

Shanice is a business administration major at Montclair State University, Class of 2016.


EU Accuses Google of Misleading Consumers, Competitors in Web Search Case

Posted by Stephanie Ramos.

Like no other company, Google has revolutionized the way we conduct web searches over the last ten years. However, in the years after it went public, Google’s increasing market dominance was generating both “sky-high profits and unwanted regulatory attention.” In April 2015, the European Union’s antitrust chief formally accused Google of abusing its dominance in web searches, bringing charges that could “limit the giant American tech company’s moneymaking prowess.” This is the first case that antitrust charges have been brought against Google, despite a years long faceoff between the company and regulators in the EU. Most importantly, it “will almost certainly increase pressure on Google to address complaints that the company favors its own products in search results over its rivals’ services.” In addition, a formal antitrust investigation into the company’s Android smartphone software is underway.

Regulators have focused on accusations that Google “diverts traffic from competitors rivals to favor its own comparison shopping site.” However, Google has defended its business practices, by stating that “[P]eople can now find and access information in numerous different ways—an allegations of harm, for consumers and competitors, have proved to be wide of the mark.” In today’s modern world, privacy laws and consumer protection laws have come under intense scrutiny. Big companies, such as Amazon and Facebook, have become subjects of investigations in matters such as low-tax arrangements and protecting people’s online data. In the United States, the Federal Trade Commission investigated “antitrust complaints against Google, but closed that inquiry in 2013 without reaching a formal finding of wrongdoing” in the way it arranges its Web search results. In addition, the investigation into Google can increase political tensions between the European Union and the United States.

Antitrust laws are statutes developed to protect consumers from predatory business practices by ensuring that fair competition exists in an open-market economy. In this case, the EU is accusing Google of abusing its powers by “diverting traffic from competitors rivals to favor its own comparison shopping site. This case raises the issues of corporations and ethics. In this case, Google is a big company that generates billions of dollars in revenue. However, whether these revenues are generated through ethical practices is an ongoing question that EU is trying to solve. “Google will have [ten] weeks to make a formal response to the charges.” It “can also request a formal hearing during a procedure that commonly takes a couple of years and often results in companies’ eventually making appeals at the Court of Justice of the European Union.”

Stephanie is a business administration major with a concentration in international business at Montclair State University, Class of 2016.

Courts Decide Spiderman “Web Blaster” Patent Case

Posted by Bailey Obetz.

In this article, Stephen Kimble, inventor of a toy that allowed consumers to shoot web-like material from their palms imitating the power of the superhero Spiderman, sued Marvel in 1997 for patent infringement because it was selling a similar item called the “Web Blaster.” In an agreement between Kimbel and Marvel, Kimbel was to receive royalties on past, present, and future sales of the toy. However, it was unbeknownst to Kimble and Marvel that the royalties had no end date. Under Brulotte vs. Thys Co. (1964 decision), royalties only have to be paid until the patent expires. The issue the courts are currently facing is should the decision of the 1964 case be overruled? Specifically, in Kimble vs. Marvel Enterprises, Kimble’s lawyer believes the case is “‘widely recognized as an outdated and misguided decision that prohibits royalty arrangements that are frequently socially beneficial.’” (Liptak p.6).

“Stare decisis” is Latin for “’to stand by things decided,’” which helps the courts be efficient in their reasoning by using prior cases as guides to their decision-making. Additionally, “stare decisis” makes the law predictable for citizens—they can rely on the court to make the best decisions based on what the law has been from previous cases. The courts are obligated to follow precedent, however sometimes they may rule that the case should no longer be followed. Reasons for not following a precedent could be technological or social changes that make the case inapplicable or if the case is no longer considered “good law.” When courts decide not to follow precedent, as they may in this case, they can receive a lot of attention, which is why this case is of particular interest.

Bailey is a business administration major with a concentration in management at Montclair State University, Class of 2017.

Importance of Having Enforceable Contracts In Business

Posted by Bailey Obetz.

A contract is an agreement that can be enforced in court; it is formed by two or more parties, each of whom agrees to perform or to refrain from performing some act now or in the future. For a contract to be enforced something of value must be exchanged by all parties involved. Other elements that are considered in determining if a contract is enforceable are meeting of the minds, duration, and value of things exchanged. Meeting of minds is merely a phrase used in contract law that describes the intentions — a mutual understanding in the formation of the contract. The element of duration refers to the length of time it will take for the parties will complete their part of the contract. Confusion and interferences of duration can disrupt the meeting of the minds regarding the contract. The consideration element is something of value received or promised such as money. The best way to avoid hindering enforceability of a contract is to make all provisions clear and be sure they are understood by all parties involved.

Many times a dispute arises when there is a promise of future performance and in many cases it is uncertain if any contract exists at all. This article recommends that the best way to ensure an enforceable contract is to hire an attorney. Many future problems can be avoided if an attorney is hired and creates a detailed agreement. Also, an attorney can help a party avoid creating illegal or unenforceable provisions in a contract. Contracts are particularly important in the business atmosphere because they can enhance or break relationships that business men/women encounter on a daily basis.

Bailey is a business administration major with a concentration in management at Montclair State University, Class of 2017.