Affordable Care Act Archives – Blog Business Law – a resource for business law students

Posted by Devaki Sidhaye.

Recently department of Justice announced largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 individuals, including 115 doctors, nurses and other licensed medical professionals. Their involvement in health care fraud scams totaling approximately $1.3 billion in false billings. As per the department, many of the charges were related to medical professionals illegally prescribing opioids and other prescription narcotics, some of which were then sold on the street. Furthermore, according to federal officials, a rehab facility in Palm Beach, Fla., recruited addicts with gift cards, drugs and visits to strip clubs, billed the government for over $58 million in false treatments and tests. A clinic in Houston allegedly gave out prescriptions for cash. Some falsely billed Medicare and Medicaid. Narcotics officers have arrested schoolteachers, doctors, nurses and fellow law enforcement personnel (Merle, 2017).

According to the Centers for Disease Control and Prevention, approximately 91 Americans die every day of an opioid related overdose. Attorney General Jeff Sessions said at a news conference that, “One American dies of a drug overdose every 11 minutes and more than 2 million Americans are ensnared in addiction to prescription painkillers.” He further said in assurance that, “We will continue to find, arrest, prosecute, convict and incarcerate fraudsters and drug dealers wherever they are.” Health and Human Services Inspector General Daniel Levinson added that, “Health care fraud is a reprehensible crime, it not only represents a theft from taxpayers who fund these vital programs, but impacts the millions of Americans who rely on Medicare and Medicaid” (Merle, 2017).

This approaches a larger debate about how the country should address the government estimates are addicted to opioids. Public health authorities urge doctors to cut back on the prescriptions they offer. States struggling with the shortage of treatment has proposed roll back of the Affordable Care Act’s expansion of Medicaid (Merle, 2017).

This crisis represents a massive public health challenge that requires a broad-based, multi-pronged response from public health agencies and law enforcement. Physicians, pharmacists and citizens all can play a role in identifying and preventing nonmedical use of prescription drugs. Doctors and other healthcare professionals who prescribe these drugs need to be educated about responsible prescribing of opioids and about safe, effective alternatives that are not addictive and presently available (Young, 2016).

Even though law enforcement officials use advanced investigative methods to uncover the different actions health care fraud happens, they can’t fight these crimes alone. Individual can help remove these people responsible for wrongdoings by protecting their health insurance identification number, social security number, looking through the statements for medical services he didn’t receive, and reporting to authorities on recognizing the signs of possible fraud (Outreach, 2012).

For the protection of each person of the country as well as for the economic strength it is essential to destroy all traces of health care fraud. Health care frauds damage billions of dollars of the nation; mislead general public in the courses of actions, and innocent people become victims of white-collar crime.

Devaki is an MS Accounting student at the Feliciano School of Business, Montclair State University, Class of 2018.

References:

Merle, S. H. (2017, 07 13). DOJ announces charges against 400 people for $1.3 billion in health-care fraud. Retrieved from www.washingtonpost.com: https://www.washingtonpost.com/news/business/wp/2017/07/13/doj-announces-charges-against-400-people-for-1-3-billion-in-health-care-fraud/?utm_term=.f9b959fbfea6

Outreach, E. &. (2012, 04 23). How to Protect Yourself From Health Care Scams. Retrieved from www.aarp.org: http://www.aarp.org/health/medicare-insurance/info-10-2010/fightfraud.html

Young, L. (2016, 03 04). There’s no debate – America’s opioid epidemic is undeniable. Retrieved from www.pennlive.com: http://www.pennlive.com/opinion/2017/09/heres_what_you_need_to_know_ab_5.html

Research proposal posted by Jessica Thomulka.

Part One

Healthcare costs are skyrocketing in the United States. Even prior to the passing of President Obama’s Affordable Care Act, the burden on American corporations to provide healthcare to their employees was placing stress on businesses. Lifestyle control is the term given to an employer’s influence on an employee’s actions outside of the scope of their duties as an employee. Some of the most common examples of lifestyle control revolve around the preventative measures to lessen the pressure of the paying for employee medical coverage. The two most costly medical conditions are complications arising from smoking and obesity. The National Business Group on Health reports that obese employees cost employers $700 more than their average-weight employees, annually, for their healthcare. Along with healthcare, another aspect of business that employers are concerned about is productivity. In a 2002 study, the Center for Disease Control reports that productivity losses associated with workers who smoke cigarettes are estimated to be $3,400 per smoker.[1] Business owners and executives are concerned with maximizing their profits and ensuring the health of their company, and by keeping their employees healthy, they can reduce their risk of paying high medical expenses for preventable diseases. Some states like New York have passed provisions to prevent employer discrimination against an employee’s “after-hours” conduct, however there is no federal statute.

Part Two

There are both pros and cons to the idea of employers having control of the lifestyle of their employees. The stakeholders involved include the employer, the employees, the family of the employees, and even the ‘vice’ industries that the employers are safeguarding against such as the tobacco and gambling industries. The employers reap the most positive benefits out of lifestyle control provisions. They lower their cost and increase their productivity. The employees may also benefits from such provisions due to increased health, but they give up some of their freedom in the process. Some companies also impose lifestyle control upon the employee’s family if they are on the same health insurance policy so likewise, they may gain health benefits but sacrifice some of their freedom. Lastly, ‘vice’ industries suffer the most from lifestyle controls because they ultimately lose business due to embargos on acts like smoking and gambling. If enough companies impose lifestyle controls they could potentially bankrupt ‘vice’ industries.

Part Three

The biggest ethical question regarding lifestyle control is the autonomy of the employee. Should an employee be free from external control or influence by the employer? According to the United States Conference of Catholic Bishops (USCCB) there are several themes of Catholic Social Teaching.[2] Rights established in the Catholic tradition have an impact on lifestyle control. While privacy is not explicitly protected under the United States Constitution it falls under the penumbra of implied rights in the Bill of Rights due to its importance. The Catholic tradition teaches that human rights and responsibilities are at the heart of a healthy community. Within the workplace there is a basic right of workers to be respected by their employers. That is in decent wages, the right to unionize, and a productive work environment. The USCCB notes that work is more than just providing for yourself and your family because it is a way to participate in God’s work. They also suggest that a worthy measure of an institution is its ability to enhance the life of the human person. In the case of lifestyle control, Catholic Social Teaching aligns with provisions to protect the health of employees. This would support a ban on smoking and other such vices that are known to be detrimental to one’s health. If the motives behind the employer’s lifestyle controls align with what is good for society then they should be permissible under the Catholic Social Teaching.

[1] Halbert, Terry, and Elaine Ingulli. Law & Ethics In The Business Environment. 7th ed. Mason, OH: Thomson/South-Western West, 2003. Print.

[2] “Seven Themes of Catholic Social Teaching.” Seven Themes of Catholic Social Teaching. Web. 09 Mar. 2016. .

Wrongful Convictions – Los Angeles to Pay 24 Million to Two Men

Los Angeles will pay 24 million dollars to two men who spent decades in prison for crimes they did not commit. In one case, lawyers and a team of students from Loyola Law School challenged a key witness’s testimony. In 1979, Kash Delano Register was charged with the armed robbery and murder of Jack Sasson, 78, after eyewitness testimony placed him at the scene at the time of the shooting. The witness told police she heard gunshots and she saw Register fleeing the scene. The witness selected Register out of a photo lineup, but her sisters told police that her story was untrue. No murder weapon was recovered and no fingerprints were found. Based solely on this witness’s testimony, a jury found Register guilty and he spent 34 years in prison.

The witness’s sister testified she tried to tell a detective that her sister had lied, but in response, the investigator allegedly put a finger to his lips indicating she should keep quiet about it. Her other sister told the police that she was lying, but even her pleas were ignored. Register’s attorneys claimed that the witness selected him under the threat of being prosecuted for credit card forgery and a recent theft if she failed to choose someone out of the lineup.

In the other case, Bruce Lisker was accused of murdering his mother. “At the time of the murder, Lisker, who had a reputation for fighting with his mother and a history of drug abuse, told police he saw her lying in the foyer and broke into the home to help her. They did not believe him.” During a hearing challenging the conviction, lawyers undermined or disproved key elements of the prosecution’s case, including that a bloody shoe print that could not have been made by Lisker’s shoes. His attorneys claimed “that the lead detective ignored evidence that Lisker’s friend may have been a possible suspect.”

In every arrest and criminal prosecution, someone’s liberty is at stake, and these cases illustrate the importance that prosecutors and police get it right. Money can always be replaced. But no one can ever get back all those years lost in prison, as a result of being falsely accused.

Stryker Corp. to Repay More than $1 Billion

Posted by Abier Mustafa.

Stryker Corp., a device maker company, recalled its Rejuvenate and ABG II hip implant devices in July 2012 after warning surgeons they could harm tissue around the hip and cause other health problems to its patients. Patients have complained of severe pain, unusual swelling and excessive metal debris in their blood, blaming all these symptoms on the Stryker devices. There are at least 1,800 cases Stryker consolidated before U.S. District Judge Donovan Frank in St. Paul, Minnesota. After facing more than 4,000 suits consolidated in the New Jersey state court and federal court in Minnesota alone, Stryker will pay a base amount of $300,000 per patient’s case. This settlement to patients who had the devices surgically removed prior to November 3rd.

Stryker Corp. has reported more than $9 billion in revenue in 2013 on the advertisement of their hip implants lasting for years. After the devices failed patients within a short amount of time, the company has now agreed to pay more than $1 billion to resolve these lawsuits. However, “the company said that it set aside more than $1.4 billion to cover costs of handling cases over the recalled hips so the settlement fell into the “‘low end of the range of probable loss.’” “This settlement program provides patients compensation in a fair, timely and efficient manner,” Bill Huffnagle, a spokesman for Kalamazoo, Michigan-based Stryker, said in an e-mailed statement. A source also reveals that a majority of the payments will be made by the end of 2015.

Abier is a finance major at Montclair State University, Class of 2016.

New York State Archives – Blog Business Law – a resource for business law students

Posted by Patrick Cleaver.

Every law is made to help the public, to protect the safety of the driver, and deliver a reliable car. The car industry knows they make mistakes and are responsible for fixing the damages for free when such mistakes occur and cars get recalled. However, does a used owner know that he/she is able to get his/her car fixed for free once it had been recalled? Most people do not know that a dealer will fix the car for free after it has been recalled, so the damages are never fixed. The car, marked as dangerous, is instead sold at auctions and then sold again without ever being properly taken care off. While this may end up with nobody getting hurt, doing leaves a huge risk at the buyer’s expense.

Delia Robles was one of the unfortunate people who had been taken advantage of by this system and it ended up costing her much more than she bargained for, getting killed by a defective airbag. Ms. Robles was driving a 2001 Honda Civic on her day off from work when she hit a pickup truck. An accident that would normally end with her walking away unscathed turned into her death bed. The car she was driving has been sold five times over a fourteen-year span and was most recently bought by her son who had no idea that the car was not safe. The information which had not been released to him is that the car was never fixed after it had been recalled for problems with its airbags.

The car was equipped with Takata airbags which “have been linked to 15 deaths.” The airbags were not safe due to being made out of product that wore out over time. That meant that the airbag was a time bomb waiting to explode and Ms. Robles is the one who triggered it. When hitting the truck the Honda had released its airbags which burst and sent metal pieces flying at and killing Ms. Robles.

The issue at hand is that there are no safeguards which prevent deaths like these from occurring. The previous owner is not reliable for not fixing the car like a dealership would be had this happened to a new car. That owner is also not responsible for informing the new owner of the risks they are taking by buying the car. The auction simply sells the car “as is” and does not say whether or not the car is safe to buy.

While there are no federal laws protecting the consumer of accidents in used cars, there are state laws which are implemented in order to keep people safe. According to the New York State law, a seller is not allowed to conceal a material defect because that is a fraudulent action. Also, the New York State auctions are not allowed to sell vehicles “as is” unless they are government agencies. This is a step forward towards the right (safe) way, but does not fix the problem because the Department of Finance takes advantage of it. This department still allows clear negligence by huge companies which can lead to more incidents like the one Ms. Robles experienced. CarMax is a great example of this problem. “CarMax, one of the country’s largest used-car dealers, advertise that their vehicles pass rigorous safety tests – even if the cars have unrepaired problems for which recalls have been issued.” These companies are basically misleading the customers, making people believe that their cars are safe when in reality they could be death traps.

No malice can be proven in the case of Ms. Robles since it has had so many past owners and neither her son, nor the owner before him were aware of the recall on the Honda. Unfortunately, Ms. Robles was a victim of a broken system and now the 50 year old will never get to see her three grandchildren grow up.

Patrick is an accounting major at the Stillman School of Business, Seton Hall University, Class of 2018.

Posted by Steven Doolittle.

Daily fantasy sports are a huge part of the culture in the United States. DraftKings and FanDuel are two of the largest providers of daily fantasy sports and the New York State attorney general on Tuesday ordered those two fantasy sports companies to stop accepting bets from New York residents, due to their games constituting illegal gambling under the current state law. This decision has caused a major problem for the multibillion dollar industry, which has created a demographic of young people and partnerships with professional sports teams. Belief that this decision will continue into other states, a downward spiral for this industry is possible.

In 2006, fantasy sports that involved gambling were exempted from a prohibition against processing online financial wagering, because it was decided the games took more skill than luck. However, now with the offering of huge prizes on more individual sports leads to it being more luck- based, and therrfore, the decision is being questioned. As stated in the article, “The two companies can challenge the attorney general’s order in court. According to Joseph M. Kelly, a professor of business law at the State University College at Buffalo, the state would have to prove that chance is a material factor in fantasy sports, which would make it gambling.” There is a lot the needs to happen to finalize whether it can be classified as illegal.

“The attorney general’s office said daily fantasy sports ‘appears to be creating the same public health and economic problems associated with gambling.’” FanDuel and DraftKings argue that fantasy sports is a game of skill and legal under New York state law. Politicians are saying people are not allowed to play a game they love. It is a debate that will change the world of fantasy sports.

Steven is a student at the Stillman School of Business, Seton Hall University, Class of 2018.

Posted by Arleen Frias-Arias.

According to NPR News.com, Ocwen Mortgage, who has been tasked by FDIC (Federal Depose Insurance Corporation) and US Department of Treasury to assist consumers that are delinquent in their mortgages, is being sued. New York State’s top financial regulator has launched an investigation into Ocwen’s practices as it turns out they are finically hurting home-owners, not helping them get out of foreclosure.

The gist of the article is that Ocwen committed fraud by preparing mortgage documents particularly on what is called a loan modification, which is a legal contract prepared to adjust the payments of loan borrowers who could not make their payments due to hardship. They are also accused of not posting payments already in their possession from borrowers until past the payment due date, deliberately causing homeowners to become late and incur fees.

In my opinion, more needs to be substantiated by regulators to determine if this was widespread, because Ocwen seems to have a reputation of consistently not adhering to the law.

Arleen is a marketing and communication/TV production major at Montclair State University, Class of 2018.

Sacramento Kings Limited Partnership LP v. M-F Athletic Co. Inc.

Posted by Abigail Hofmann.

Francisco Garcia of the Sacramento Kings was lifting weights on a Ledraplastic exercise ball on October 9th, 2009. The 195 pound player was lifting two 80 pound weights while on the ball when it suddenly burst beneath him. This supposed “burst resistant” ball advertised its ability to withstand weight up to 600 pounds. In the fall, Garcia suffered a fracture to his forearm, causing ineligibility for upcoming games. This injury came shortly after signing a five year, $30 million contract. Because of this, the Sacramento Kings wanted “to recoup the more than $4 million in salary, medical expenses and other costs it incurred after Garcia’s injury, as well as prejudgment interest.” (Bricketto)

Ledraplastic initially refused to reimburse the Kings or Garcia for the financial loss or issue a statement recalling the products or forewarning about potential dangers. In the Kings’ product liability case, they were able to prove that the ball burst at weights of mere 400 pounds, rather than the advertised 600 pounds, and that “for a very small expense, the ball could have been made thicker and would have provided the burst resistant capacity as represented.” (Bricketto) Eventually, a settlement was done in private, but the Kings “sought reimbursement for the salary they paid Garcia,” and “Garcia had also sought damages for pain and suffering as well as loss in future earning capacity.” (Lu)

Ultimately, this product liability case was pretty clear on who was at fault: Ledraplastic claimed to have a ball that withstood weights up to 600 pounds, yet failed to hold even 400 pounds. This caused an injury resulting in millions of dollars of damages, and up until the settlement, Ledraplastic refused to forewarn others about this potential danger. Although the settlement was private, we do know that Ledraplastic is now required to warn users of the dangers of using the ball while lifting free weights, hopefully preventing many similar injuries.

Abigail is a management, marketing, and finance major at the Stillman School of Business, Seton Hall University, Class of 2019.

Works Cited:

Bricketto, Martin. “NBA Team Sues Exercise Ball Cos. Over $4M Injury – Law360.” NBA Team Sues Exercise Ball Cos. Over $4M Injury – Law360. N.p., n.d. Web. 08 Sept. 2016.

Lu, Andrew November 1, 2012 5:54 AM. “NBA Star Francisco Garcia Settles Exercise Ball Lawsuit.” Injured. N.p., n.d. Web. 07 Sept. 2016.

Tesco Agrees to Pay $162 Million Fine Over Accounting Scandal

Posted by Alhanouf Almubarak.

This case discusses Tesco the Britain’s biggest retailer accounting scandal. In October 2014, the Serious Fraud Office (SFO) began a criminal investigation into accounting practices at Tesco. Chris Bush, (Tesco’s former managing director), Carl Rogberg (former finance chief), and John Scouler (former food commercial head) were charged with fraud over an accounting scandal after the company announced that it had overstated its first-half profit by approximately $420 million. At that time the company suspended many executives for accounting irregularities.

Some of the reasons why Tesco overstated the expected profits of the group at that time was mainly because it agreed on commercial deals with suppliers too early. The investigations against Rogberg, Scouler and Bush revealed that they purposely falsified Tesco’s digital accounting records and its draft interim accounts by the “inputting of and/or reliance upon commercial income figures which gave a false account of the financial position of Tesco.” (Butler,2017). The offenders’ crime by abuse their position and fraud accounting can lead to prison sentences of up to 10 and seven years respectively.

No Liability for Yelp – Court rules

Posted by Steven Otto.

The San Francisco rating company, Yelp, is not found liable for negative reviews posted on its site. This is because it relies on ratings posted by users, not the company itself. A federal appeals court on Monday, September 12, dismissed a libel lawsuit filed against Yelp by Douglas Kimzey, the owner of a Washington state locksmith company. The 9th U.S. Circuit Court of Appeals ruled that, under federal law, Yelp is not liable for content it gets from its users. The features of Yelp are based on users’ input and it is not content created by the company, whose site helps guide people to anything from restaurants to plumbers and much more.

The court said that Douglas Kimzey’s business received a negative review on Yelp in 2011. Kimzey claimed that the negative review was actually meant for another business, and claimed that Yelp transferred the review to his business on purpose in an attempt to extort him. He claims that Yelp was trying to force him into paying to advertise with Yelp. The appeals court said that his allegations were not substantial and that there were no facts at all supporting Yelp fabricating content under a third party’s identity. Circuit Judge M. Margaret McKeown, writing for a unanimous three-judge panel decision, said “We fail to see how Yelp’s rating system, which is based on rating inputs from third parties and which reduces this information into a single, aggregate metric, is anything other than user-generated data.”

The appeals court previously ruled under the 1996 Communications Decency Act that “websites that provide what are known as ‘neutral tools’ to post material online cannot be held liable for libelous material posted by third parties.” Kimzey’s claim that Yelp should be held liable for distributing reviews to search engines was dismissed by this act. The appeals court stated that distributing the content does not make Yelp the creator or developer of the content.

Aaron Schur, Yelp’s senior director of litigation, said the appeals court “rightly confirmed Yelp’s ability to provide a forum for millions of consumers to share their experiences with local businesses.” Kimzey said he lost 95% of his business after getting one star on Yelp and said, “If you have a one-star rating, people won’t go near it (the business). They don’t care if you’ve been in business for one week or 25 years.” Obviously upset over what had occurred to him and the ruling, Kimzey, serving as his own attorney, plans to appeal to a larger court panel.

Steven is an accounting major at the Feliciano School of Business, Montclair State University, Class of 2019.

DOJ Announces Charges Against 400 People for $1.3 Billion in Health-Care Fraud

Posted by Devaki Sidhaye.

Recently department of Justice announced largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 individuals, including 115 doctors, nurses and other licensed medical professionals. Their involvement in health care fraud scams totaling approximately $1.3 billion in false billings. As per the department, many of the charges were related to medical professionals illegally prescribing opioids and other prescription narcotics, some of which were then sold on the street. Furthermore, according to federal officials, a rehab facility in Palm Beach, Fla., recruited addicts with gift cards, drugs and visits to strip clubs, billed the government for over $58 million in false treatments and tests. A clinic in Houston allegedly gave out prescriptions for cash. Some falsely billed Medicare and Medicaid. Narcotics officers have arrested schoolteachers, doctors, nurses and fellow law enforcement personnel (Merle, 2017).

According to the Centers for Disease Control and Prevention, approximately 91 Americans die every day of an opioid related overdose. Attorney General Jeff Sessions said at a news conference that, “One American dies of a drug overdose every 11 minutes and more than 2 million Americans are ensnared in addiction to prescription painkillers.” He further said in assurance that, “We will continue to find, arrest, prosecute, convict and incarcerate fraudsters and drug dealers wherever they are.” Health and Human Services Inspector General Daniel Levinson added that, “Health care fraud is a reprehensible crime, it not only represents a theft from taxpayers who fund these vital programs, but impacts the millions of Americans who rely on Medicare and Medicaid” (Merle, 2017).

This approaches a larger debate about how the country should address the government estimates are addicted to opioids. Public health authorities urge doctors to cut back on the prescriptions they offer. States struggling with the shortage of treatment has proposed roll back of the Affordable Care Act’s expansion of Medicaid (Merle, 2017).

This crisis represents a massive public health challenge that requires a broad-based, multi-pronged response from public health agencies and law enforcement. Physicians, pharmacists and citizens all can play a role in identifying and preventing nonmedical use of prescription drugs. Doctors and other healthcare professionals who prescribe these drugs need to be educated about responsible prescribing of opioids and about safe, effective alternatives that are not addictive and presently available (Young, 2016).

Even though law enforcement officials use advanced investigative methods to uncover the different actions health care fraud happens, they can’t fight these crimes alone. Individual can help remove these people responsible for wrongdoings by protecting their health insurance identification number, social security number, looking through the statements for medical services he didn’t receive, and reporting to authorities on recognizing the signs of possible fraud (Outreach, 2012).

For the protection of each person of the country as well as for the economic strength it is essential to destroy all traces of health care fraud. Health care frauds damage billions of dollars of the nation; mislead general public in the courses of actions, and innocent people become victims of white-collar crime.

Devaki is an MS Accounting student at the Feliciano School of Business, Montclair State University, Class of 2018.

References:

Merle, S. H. (2017, 07 13). DOJ announces charges against 400 people for $1.3 billion in health-care fraud. Retrieved from www.washingtonpost.com: https://www.washingtonpost.com/news/business/wp/2017/07/13/doj-announces-charges-against-400-people-for-1-3-billion-in-health-care-fraud/?utm_term=.f9b959fbfea6

Outreach, E. &. (2012, 04 23). How to Protect Yourself From Health Care Scams. Retrieved from www.aarp.org: http://www.aarp.org/health/medicare-insurance/info-10-2010/fightfraud.html

Young, L. (2016, 03 04). There’s no debate – America’s opioid epidemic is undeniable. Retrieved from www.pennlive.com: http://www.pennlive.com/opinion/2017/09/heres_what_you_need_to_know_ab_5.html

Entrepreneurial Young People Can Now Snow Shovel Without a Permit in NJ

Snow shoveling always has been a means for young people to learn how to run a business. They learn how to advertise, interact with customers, work for a competitive wage, and learn something about service to the community. All businesses are at the service of others; and, snow shoveling, like delivering newspapers, or running a lemonade stand, give young people a way of learning responsibility.

Governor Christie just signed into law (before a major snowstorm) making it legal for residents to offer snow shoveling services without first applying for a permit. Last year, Bound Brook, New Jersey police stopped two entrepreneurial teens for going door-to-door and offering to shovel snow for a small fee. The police told the boys they were not allowed to solicit businesses without a permit. In Bound Brook, the license costs $450. The case made national headlines.

Republican State Sen. Mike Doherty sponsored the “‘right-to-shovel’” bill, stating it “was incredible that some towns wanted teens to pay expensive licensing fees just to clear snow off driveways.”

“The bill removes only licensing requirements for snow shoveling services, and only applies to solicitations made within 24 hours before a predicted snow storm. Towns with laws prohibiting door-to-door solicitation will be able to enforce those laws in all other circumstances.”

NCAA Archives – Blog Business Law – a resource for business law students

Posted by Hailey Arteaga.

One of the biggest businesses in America is college sports.  Men’s Basketball is the second highest grossing sport of colleges across the nation.  According to Business Insider, a Division 1 Men’s Basketball teams alone drive-in an average yearly revenue of $7,880,290 (Gaines).  With this much money being streamed to a school each year for a single sport, some critics of the NCAA believe that Division 1 players should receive a salary.  However, some schools took this idea to the next level.  In a recent scandal, the FBI uncovered around 25 D1 colleges committing acts of bribery and corruption in the sport of basketball in an article written by the New York Post (Masisak).  One college under fire for violating the NCAA rule is Seton Hall University.  Recently though, the University has argued that they “have nothing to hide” (Braziller).  So, who is in the wrong?  This post serves as an analyzation of Seton Hall’s past and the basketball allegations that might hurt the business of the athletics department.

The NCAA defines an “eligible” athlete as one that does not accept outside payments because of their athletic status.  This extends to a professional agent bribing players with food, rent, cash, etc.  (Athnet).  Seton Hall was named as one of the schools by the FBI. They reported that the university was paying now New York Nets player, Isaiah Whitehead, extra money to play for the Pirates.  Agents discovered a spreadsheet with players past and present from multiple universities indicating the amounts of money they were being paid to attend and play basketball at their schools.  The spreadsheet revealed that Whitehead in particular received $26,136 his freshman year and was “setting up a payment plan” (Braziller).  This would go against the NCAA rules of amateurism as stated previously.  In more recent news however, The Hall came out and stated that they will be bringing in New York City law firm, Jackson Lewis P.C. to disprove the corruption scandal (Braziller).  Kevin Willard noted regarding the development that “I have a lot of confidence in my staff and ourselves in what we’ve done in the past.  I’m glad the school moved quickly on this so we can move on from it.”  With such a strong assurance of the team’s actions, Willard and the university should be expected to move on from the situation unscathed.

If Seton Hall were to be found guilty of the corruption, it would greatly affect the basketball team and success of the athletic department.  It could potentially risk the Hall’s ability to compete in the NCAA tournament.  The payout for the 2017 NCAA tournament that Seton Hall earned for the Big East Conference last year was $1,711,784 (Kesselring).  This means that not only would an inability to compete in the tournament affect the university itself, but also it would affect the entire Big East Conference.  Some even argue that Seton Hall could risk their 2016 Tournament Champion Title or even Kevin Willard’s position as head coach.  In the end, Seton Hall is risking a lot putting their name in the forefront of one of the biggest, recent scandals to rock college basketball.  If found that they have been giving players money under the table, the university will immediately face heavy financial cuts due to their disobedience of NCAA rules, hurting other sports, other schools, and the entire conference.

Hailey is a student at the Stillman School of Business, Class of 2020.

Sources:

http://www.businessinsider.com/college-sports-revenue-2016-10

https://www.athleticscholarships.net/ncaa-loss-eligibility-payment-agent.htm

https://nypost.com/2018/02/24/analyzing-how-scandal-will-affect-ncaa-tourney-coaches/

https://nypost.com/2018/02/24/seton-halls-plan-to-prove-innocence-in-fbi-corruption-probe/

https://herosports.com/ncaa-tournament/how-much-money-ncaa-tournament-earned-conference-2017-basketball-fund-a7a7

Posted by Adam Kutarnia.

People have been betting on sports for centuries, however, the multi-billion dollar industry is illegal in almost all parts of the United States except for four states – Nevada, Delaware, Oregon and Montana. Last summer, 29 men were arrested in New Jersey for running a sports betting ring that grossed approximately to $3 million during a 12-month period. New Jersey is one of the many states where sports gambling is illegal, but many are fighting to change the law.

While most of the world allows sports gambling, the United States has been strict about it since passing the Professional and Amateur Sports Protection Act of 1992, which prohibits sports gambling nationwide, excluding a few states. New Jersey has been pushing hard to legalize sports gambling in the last couple years, but has been unsuccessful due to four major professional sports leagues – NBA, NFL, MLB and NHL and NCAA blocking it.

New Jersey Governor Chris Christe has been a strong supporter of legalizing sports gambling in New Jersey, and even signed a law passed by the state legislatures to allow sports gambling in New Jersey’s casinos and racetracks, before the major professional leagues and NCAA blocked it. The plaintiffs argue that sports betting would harm the integrity of sports and violate federal law. As of right now, New Jersey is losing millions of dollars in potential revenue to offshore and organized crime.

New Jersey will get another shot at their case after a federal court hearing before a three-judge panel of the Third Circuit Court of Appeals took place last month; a ruling in the case will be made on June 26.

Like the case above with the 29 men being arrested for running a sports betting ring, people want to bet on games and will do so whether it’s legal or not.

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