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Malafi Speaks at Touro Law Announcing New Girl Scout Justice Patch Program

Posted: April 20th, 2015

Touro Law Center and Girl Scouts of Suffolk County have announced an all-new Justice Patch Program. The program was designed to develop a sense of fairness, an understanding of why we have laws and how they can be changed when they don’t work. Girls will learn how laws are designed to help people, and the role that lawyers and judges fill in the community.

CMM Partner Christine Malafi, a former Girl Scout herself, serves on the Board of Governors of Touro Law School, was there to encourage the girls to participate in the Program and to congratulate all involved in creation of the Justice Patch Program.

Touro Law Dean Patricia Salkin stated, “I believe this is a first-of-its kind program between a law school and the Girl Scouts and we are proud to be a part of having girls talk about laws and learn about the justice system.”

Girl Scouts of Suffolk County is the largest youth-serving agency on Long Island, serving more than 40,000 girls and 9,000 adult volunteers. One of every four girls in grades K through 12 in Suffolk County is a Girl Scout. Specific guidelines have been set to earn the patch for all levels of girls involved with the Girl Scouts including Daisy, Brownie, Junior, Cadette, Senior and Ambassador. At the youngest ages, girls will talk about law and rules and consequences. As the girls get older and more mature, they will be involved in more engaging discussions, visit the law school, select a law to research, develop a brochure for community members to understand their rights, and more.

“We are delighted to partner with Touro Law in offering the Justice Patch Program,” says Yvonne Grant, President & CEO of Girl Scouts of Suffolk County. “Honesty and fairness are at the core of Girl Scouting, and the Justice Patch Program is a wonderful way for girls to learn to practice and extol these values.”

Professor Tracy Norton, who teaches at Touro Law and has two daughters who are active members of the Girl Scouts of Suffolk County stated, “The Girl Scouts commitment to public services and Touro Law’s commitment to the community blend perfectly together to create a synergy that will surely benefit generations of girls. I am honestly thrilled to be a part of this program.”

About Touro Law

Touro College Jacob D. Fuchsberg Law Center’s 185,000-square-foot, state-of-the-art law school is located adjacent to both a state and a federal courthouse in Central Islip, New York. Touro Law’s proximity to the courthouses, coupled with programming developed to integrate the courtroom into the classroom, provide a one-of-a kind learning model for law students, combining a rigorous curriculum taught by expert faculty with a practical courtroom experience. Touro Law, which has a student body of approximately 650 and an alumni base of more than 6,000, offers full- and part-time J.D. programs, several dual degree programs and graduate law programs for US and foreign law graduates. Touro Law Center is part of the Touro College system.

Touro Law’s newly implemented Portals to Practice is a cutting-edge, experiential learning program that reconceives and restructures the law school experience. Portals to Practice expands the scope and quality of legal education by focusing on the development of legal professionals, from pre-law through post-graduation.

Grandchild’s College Expenses

Posted: April 20th, 2015

By: Martin Glass, Esq. email

Tags: elder law, estate planning

Now that my kids are out of college, it’s time to start thinking about trying to help out my (future) grandchildren’s education. Who knows how expensive that’s going to be in twenty-plus years? It’s actually fairly common that grandparents want to help with college expenses for their grandchildren. And most grandparents want to do so in a way that won’t affect their grandchild’s financial aid eligibility.

One of the most common ways that parents and grandparents help is through use of a 529 Plan. A 529 Plan is a special type of tax‑deferred account that has both an owner and a beneficiary. In most cases, it’s beneficial that the grandparent be the owner of the account. The beneficiary is the student incurring college expenses.

There are a number of advantages of a 529 Plan, especially over a regular savings plan or a custodial plan. First, contributions to a 529 Plan are removed from a grandparent’s taxable estate for both federal and New York Estate Tax purposes. This is also true in a custodial account, but in that case the funds can be used at any time for any purpose, so long as it’s for the child or grandchild’s benefit.

Second, the contributions grow free of any income taxes. Withdrawals from the plan are free of tax so long as used for qualified higher education expenses. And if one child doesn’t need it, the owner (usually the grandparent in this case) can change the beneficiary on the account to another family member of the original beneficiary.

Many of the questions about 529 Plans that clients have asked me revolve around their effect on student aid. The good news is that so long as the grandparent (not the parent) of the student is the owner, the 529 Plan does not count as an asset for determining financial aid. However, the bad news is that any distributions from the grandparent‑owned plan do count as income for student aid purposes.

A fairly straightforward strategy that can mitigate this income effect is as follows: by January 1 of the student’s junior year, the student will have filed his last FAFSA. This means that distributions from a grandparent‑owned 529 Plan after this date will not affect financial aid. If the student’s parents have saved anything for the student’s college, the strategy here is to use their savings for the first 2.5 years of college, and then use the grandparent‑owned 529 Plan to pay for the final 1.5 years. If you have to use the grandparent 529 Plan earlier, then obviously you should do so, but it will still minimize the overall effect it will have on the student’s financial aid.

Recent Landlord Tenant Case Developments

Posted: April 20th, 2015

By Patrick McCormick

Three recent decisions, two from the Supreme Court, Appellate Term, First Department and the third from Supreme Court, Queens County (Ritholtz, J.) are instructive to landlord/tenant practitioners. The first involves an application by a tenant for a Yellowstone injunction; the second involves a tenant’s renewal option contained in a commercial lease; and, the third involves enforcement of a settlement agreement.

A Yellowstone injunction is a procedural mechanism used by tenants to maintain the status quo and to toll the running of a cure period so that a commercial tenant confronted by threat of termination of its lease may protect its investment in the leasehold.[1] The party requesting Yellowstone relief needs to demonstrate: (1) it holds a commercial lease; (2) it received from the landlord either a notice of default, a notice to cure, or a threat of termination of the lease; (3) it requested injunctive relief prior to the termination of the lease; and, (4) it is ready, willing and able to cure the alleged default by any means short of vacating the premises.[2]

In NY Great Stone, Inc. v. Two Fulton Square LLC, [3] the tenant received a ten (10) day notice to cure dated November 21, 2014. The cure notice alleged the tenant defaulted under the terms of the lease by failing to conduct a hydrostatic pressure test on a sprinkler system in the premises and failed to obtain comprehensive general liability insurance required by the lease. The lease at issue obligated the tenant to obtain and maintain general liability insurance for the term of the lease naming the landlord as an additional insured. This type of insurance clause is common in commercial leases. The tenant, in its application for a Yellowstone injunction, provided the Court with a certificate of liability insurance dated December 2, 2014 evidencing coverage effective April 7, 2014 to April 7, 2015, and indicating the landlord as an additional insured. Based on the documentation provided to the Court, the Court denied the application for a Yellowstone injunction. The Court, correctly in my view, noted that the tenant’s failure to maintain proper insurance is a material default under the terms of the lease and that such a default is not curable because a prospective insurance policy does not necessarily protect a landlord against unknown claims that might arise during the period in which no coverage exists. Thus, existence of current coverage did not cure the default for failing to maintain (or perhaps not prove) the existence of coverage from the inception of the lease. The tenant argued that the default notice directed it to obtain general public liability insurance, but the Court was not persuaded that the default was cured by tenant’s claim that it obtained a current policy of general liability insurance as demanded by the cure notice. Accordingly, Yellowstone relief was denied as the tenant could not establish that it was ready, willing and able to cure the default.

The next case, 315 West 48^th Street Realty Corp. v. Maria’s Mont Blanc Restaurant Corp,[4] involved a commercial lease in which the tenant operated a restaurant under two separate lease agreements that expired, at the expiration of a five (5) year renewal term, on August 31, 2010. The landlord commenced a holdover proceeding and tenant defended alleging that its predecessor validly exercised a second renewal option for both leases to extend the term through August 31, 2015. The Court noted that the tenant’s claim was not properly raised at trial but, nevertheless, should have been rejected because the tenant did not establish that the second renewal option was properly exercised. The tenant apparently claimed, but no evidence was produced at the trial, that the prior tenant gave notice to the landlord of its intent to exercise the renewal option. The Court also rejected the tenant’s claim that the second renewal option was exercised when its predecessor exercised the first renewal option. The Court noted that the leases did not authorize the tenant simultaneously to exercise the renewal options for both renewal terms and, based upon the renewal language in the leases, the court concluded that the parties intended that the second renewal option could be exercised only during the first renewal term. The Court therefore found that notice of the exercise of the second renewal term claimed by tenant was not timely given and therefore was ineffective. While Courts may, in an exercise of equity, relieve a tenant from its failure to timely exercise a renewal option if no prejudice is demonstrated, it appears in this instance that the tenant did not provide the Court with any evidence or basis to grant such relief.

Finally, 567 West 125^th Street Realty, LLC v. VJRJ Restaurants, LLC[5] involved enforcement of a settlement agreement entered into between landlord and tenant. The facts of this matter are straight forward. In a commercial non-payment summary proceeding the landlord and tenant settled the matter by entering into a settlement agreement awarding a judgment of possession and judgment for rent arrears. The stipulation itself recited that it was “the product of ‘extensive negotiations’ between the parties, provided for the warrant of eviction to issue ‘forthwith,’ with execution of the warrant stayed on the condition that the corporate tenant complied with the specific ‘time of the essence’ payment schedule.” Upon a default by tenant under the stipulation, landlord was obligated to serve a three day cure notice. The tenant failed to make several payments due under the stipulation and the landlord served the requisite three day cure notice. The lower court granted tenant’s application to stay the execution of the warrant, entered on condition that the tenant pay the arrears. The Appellate Term reversed. The Court, in reversing, instructed that “strict enforcement of the parties’ stipulation…is warranted based upon the principle that parties to a civil dispute are free to chart their own litigation course” (citation omitted). The Court noted that the tenant did not provide a valid excuse for its failure to comply with the time of the essence payment requirements of the stipulation, the tenant entered into the stipulation upon the advice of counsel and the tenant’s excuse that it was in the process of selling certain business equipment was not good cause under RPAPL 749(3) to justify staying the execution on the warrant of the eviction. It appears that the specific language of this particular settlement agreement that recited that it was the product of extensive negotiations; that payments were required “time of the essence” and that it was entered into on the advice of counsel are all significant factors in the Court’s determination. From a landlord’s prospective, these provisions should be included, where appropriate, in all settlement stipulations.

Email Pat

[1] Graubard, Mollen, Horowitz, Pomeranz & Shapiro v. 600 Third Avenue Associates, 93 N.Y.2d 508, 514, 693 N.Y.S.2d 91, 94 (1999).
[2] Id.
[3] 17762/2014, NYLJ 1202722119287, at *1 (Sup., QU, Decided March 24, 2015).
[4] 2015 WL 1133988, 2015 N.Y. Slip Op. 25077 (App. Term, 1^stDep’t 2015).
[5] 46 Misc.3d 150(A)(App. Term, 1^st Dep’t 2015).

New York Court of Appeals Rules that a Traffic Stop based upon a Police Officer’s Mistaken View of the Law is Constitutional

Posted: April 20th, 2015

Tags: criminal defense

New York State has long granted greater Fourth Amendment exclusionary rule protection to defendants under its holdings than federal courts have. One example is found when a police officer in good faith bases a stop and search of a defendant upon a mistaken belief about the law. Under the federal “good faith” exception, a mistaken view of the law is not necessarily fatal to a police officer’s illegal stop and search of a defendant. In contrast, the New York Court of Appeals held in People v. Bigelow, 66 N.Y.2d 417 (1985), that there is no “good faith” exception to the exclusionary rule. Thus, under Bigelow, even when a police officer in good faith relies upon a mistaken view of the law, the fruits of any search and seizure based upon this mistaken view are subject to suppression under the exclusionary rule.

On April 7, 2015, the New York Court of Appeals carved out an exception to Bigelow that may water down its earlier rejection of the “good faith” exception. In People v. Guthrie, ___N.Y.3d___ (No. 50, April 7, 2015), the Court held that a traffic stop made pursuant to a police officer’s objectively reasonable, but mistaken, view of the law is nonetheless constitutional under both the Fourth Amendment of the Constitution and Article I, Section 12 of the New York State Constitution.

In Guthrie, a police officer stopped the defendant for passing a stop sign. Upon interviewing the defendant during the traffic stop, he smelled a strong odor of alcohol. After failing field sobriety tests, the defendant was arrested for Driving While Intoxicated. The defendant moved to suppress the evidence resulting from the traffic stop because the stop sign was illegal under the N.Y. Vehicle and Traffic Law (“VTL”). Under Section 1100(b), the VTL requires all stop signs to be registered. In Ms. Guthrie’s case, the stop sign was not registered as required by VTL 1100(b). Consistent with Bigelow, the lower court suppressed the stop and dismissed the charges.

The Court of Appeals reversed the dismissal on the grounds that, while mistaken, the police officer’s belief that Ms. Guthrie violated the law when she passed the unregistered stop sign was “reasonable.” In so doing, the Court carved out a “reasonableness” exception to New York’s earlier refusal to apply the “good faith” exception to the exclusionary rule. The Court cited prior holdings that the Fourth Amendment and New York’s Article I, Section 12 require that any exercise of police power must be reasonable, and that any police seizure may not be arbitrary. People v. Robinson, 97 N.Y.2d 341, 353 (2001). Going further, the Court cited the recent Supreme Court case of Heien v. North Carolina, ___ U.S.___ (2014), which held that the Fourth Amendment can tolerate objectively reasonable mistakes by a police officer, whether they be mistakes of fact or law.

Aligning itself with the Supreme Court in Heien, the Court of Appeals insists here that it still adheres to its Bigelow rule rejecting the “good faith” exception. It says that rather than ask whether a police officer relied upon a mistaken view of the law in good faith, the determinative question is rather whether the police officer’s mistake was objectively reasonable.

The lesson here is that those facing prosecution should turn to experienced counsel that stays abreast of these latest legal developments in order to maximize opportunities to challenge the prosecution’s evidence. The attorneys at Campolo Middleton and McCormick, LLP remain ready to answer these calls.

Trademark Trolls Overseas

Posted: April 20th, 2015

Tags: intellectual property, international

A U.S. trademark registration allows companies to leverage their brand and prevent others from using their name or a confusingly similar name in the U.S. However, even if a trademark is protected in the U.S., it is vulnerable to squatters or “trademark trolls” overseas.

Because of the global nature of business today, especially with online commerce and social media, it is important for companies looking to expand internationally to control their trademarks globally and prevent others from squatting on their rights. The last thing a company wants to find out is that it is prevented from expanding its business overseas because it did not fully protect its trademark.

While brands are increasingly global, managing and protecting brands globally can be complex. In the U.S., trademark rights are based on actual use. By comparison, trademark rights in many other countries are based on filing. The “first-to-file” system has allowed for a growing trend of “trademark trolls” – companies or individuals who strategically register trademarks belonging to others and then demand large sums of money to sell the trademark back to the original owner or bring an infringement action to enforce their rights as the lawful owner against the original owner. This is exactly what happened to Tesla, Apple, and many others when they sought to expand into China.

Therefore, companies planning to expand overseas should consider filing registrations in other countries before someone else does. Specifically, companies seeking further opportunities overseas and are looking to remain in the market long-term should ensure that their brand is protected internationally. Ideally, promptly registering trademarks in a country should be undertaken before any products are sold or manufactured there.

However, this is not without complications. Many “first-to-file” jurisdictions allow for the trademark registration to be canceled if not subsequently used in commerce within a certain time frame. Therefore, it is important to identify and prioritize the key markets and understand the jurisdiction’s trademark laws.

Although it does take time and resources to register a trademark in different countries, the alternative of exporting goods to another country without a registered trademark leaves the brand unprotected and open to considerable risk.

Prepayment Review Deadlines Published for Medicare Providers

Posted: April 20th, 2015

Tags: healthcare

As we recover from the cold winter, Medicare has prescribed a healthy dose of alphabet soup to Medicare providers and suppliers. New Change Request 8583 to the Medicare Program Integrity Manual (“MPIM”) imposes a new deadline on Medicare providers and suppliers to provide requested documentation during a prepayment review.

Effective April 1, 2015, the MPIM amends Chapter 3, Section 3.2.3.2 to require Medicare Administrative Contractors (“MACs”), Recovery Audit Contractors (“RACs”), Comprehensive Error Rate Testing Contractors (“CERTs”) and Zone Program Integrity Contractors (“ZPICs”) to solicit additional documentation from the Medicare provider or supplier by issuing an additional documentation request (“ADR”).

A provider or supplier must provide the documentation requested in the ADR within 45 days or the claim will be denied. The MPIM instructs reviewers not to grant extensions to providers who need more time to comply with the request.

Prepay review and claims denials may quickly devastate a medical practice. Providers and suppliers can take the following steps to protect themselves:

Conduct annual compliance audits
Update policies and procedures to prevent documentation errors identified in your compliance audit
Make sure billing staff are aware of the 45-day deadline to comply with ADRs

Business Interruption Insurance: Protection Against Suspension of Business

Posted: April 20th, 2015

By Christine Malafi

Business interruption insurance is designed to protect your business if your business premises is physically damaged and there is a suspension or halt of business activity at that location. It is not typically a “free-standing” insurance policy—rather, it is an additional coverage that can be added to a property damage insurance policy (i.e., fire policy) as an endorsement or a rider (for an additional fee, or course). In other words, if you don’t ask for it, you don’t have the protection it offers. This type of additional insurance protects against your inability to continue business operations because of events outside of your control, such as severe flooding or another catastrophic events, and is intended to place your business in the same position had the event causing the suspension of business activity not occurred. For example, if you have to move your business from one location to another, even temporarily, there will be expenses to do so, or you may not be able to conduct business at all and lose profits. Business interruption insurance can protect against these events.

Insurers usually offer two different types of business interruption coverage: a valued policy and an open policy. In a valued policy, the insurer and insured agree upon a fixed amount, in advance, to be paid in the event of a business interruption. An open policy covers any provable loss resulting from an interruption and requires the insured offer verifiable, competent proof of the damages in order to collect the proceeds. The burden of proof for reimbursement varies according to specific policy language. For example, under a sole cause standard, the insured must prove that physical damage claimed under the other portion of the policy was the only (sole) reason for the halt of business operations. Some coverages will allow the insured to relocate when severe physical damage has occurred, and, so long as the insured attempts to mitigate the damages, the insurer will typically authorize payment for reimbursement of costs.

Business interruption coverage protects businesses more fully than a fire or property loss insurance policy alone. In recent years, we have seen some horrible storms, including Hurricanes Katrina and Sandy. Business interruption coverage is designed to help businesses that are negatively affected from these types of storms and other catastrophic events and may be considered a necessary business expense.

Campolo Joins LI Red Cross Board of Directors

Posted: April 13th, 2015

Joe Campolo

CMM is proud to announce that Joe Campolo has been welcomed to the American Red Cross on Long Island board of directors. The Long Island Red Cross board of directors is comprised of business and community leaders who volunteer their time to help oversee the organization’s mission on Long Island. The Long Island Red Cross responds to approximately 200 disasters a year, and serves more than 2.8 million residents. Joe joins with three other individuals who have also recently joined the Board; J. Bryan Anthony, philanthropist and returning Long Island Red Cross board member; Joseph Louchheim, president of the Press News Group; and Nancy Simmons, executive vice president and chief administrative officer at Good Samaritan Hospital Medical Center.

“I’m thrilled to welcome these four civic-minded Long Islanders to our board of directors,” said John Miller, CEO of the Long Island Red Cross. “I know that their experience, enthusiasm and community spirit will help to further the mission of the Long Island Red Cross in countless ways.”

As Managing Partner of Campolo, Middleton & McCormick, Joe Campolo specializes in representing individuals and businesses involved in complex legal matters. Prior to founding CMM, he served honorably in the United States Marine Corps, and then attended Stony Brook University and Fordham Law School. “It is an honor being able to give back to an organization that directly helped me during the time I was enlisted in the military,” said Campolo.

About The American Red Cross:
The American Red Cross shelters, feeds and provides emotional support to victims of disasters; supplies about 40 percent of the nation’s blood; teaches skills that save lives; provides international humanitarian aid; and supports military members and their families. The Red Cross is a not-for-profit organization that depends on volunteers and the generosity of the American public to perform its mission. For more information, please visit: redcross.org/li.

April 27: CMM Attorney on Stony Brook Alumni Panel: Successfully Transition from College to Career

Posted: April 10th, 2015

CMM Attorney Vincent Costa Speaking on Alumni Panel: Successfully Transition from College to Career

This panel discussion seeks to educate graduating seniors and recent alumni on how to make a successful transition from college to the workplace.

Monday, April 27, 2015
6 PM – 7:30 PM
Stony Brook University Campus
Charles B. Wang Center
Room 201

Making the transition from student to professional can be difficult and confusing. Learn how to gain a better understanding of what it takes to be successful during the “unique first-year” in a new organization after graduation. Professionals representing various careers will answer questions about how to navigate company culture and manage relationships, and will provide tips on how to set yourself up for career success.

Alumni Panelists:

Caitlin Harley ’09: Research Manager, Entertainment
Vincent Costa ’09: Associate, Law
Ahmed Belazi ’09: Director of Planning & Staff Development, Education
Kaitlyn Pickford ’08: Outreach Coordinator and Town & Village Courts Liaison, Government

Join us after the panel for networking with alumni panelists and career professionals!

Questions? Please contact Nikki Barnett at nikki.barnett@stonybrook.edu.

This event is brought to you by the Stony Brook University Career Center and Alumni Career Services.