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Proposed Telemedicine Regulations and Increased Payments for Vaccination Banner Image

Proposed Telemedicine Regulations and Increased Payments for Vaccination

Month: March 2021

Proposed Telemedicine Regulations and Increased Payments for Vaccination

Posted on by rd_admin

For more information about this blog post, please contact Khaled J. Klele, Ryan M. Magee, or Labinot Alexander Berlajolli.

Proposed Telemedicine Rules

The New Jersey Division of Consumer Affairs introduced a series of proposed rules intended to expand healthcare providers’ ability to engage in telemedicine and telehealth. The proposed rules span a number of healthcare providers, including dentists and dental hygienists, marriage and family therapy counselors, respiratory care practitioners, and occupational therapists.

Collectively, the proposed rules expressly permit the provision of, and establish standards of care for, telemedicine and telehealth services. The proposed rules also outline the proper steps for establishing patient/client relationships and provide guidance on proper prescribing practices. Additionally, the rules impose protocols for the maintenance of patient and client records and require enhanced privacy practices to ensure the confidentiality of the same.

The proposed rules are open to public comment through May 14, 2021.

CMS Increases Medicare Payment for COVID-19 Administration

Centers for Medicare and Medicaid Services (“CMS”) has increased the amount Medicare will pay to providers for administering the COVID-19 vaccine. Effective March 15, the national average payment rate for physicians, hospitals, pharmacies, and many other immunizers will be $40 for a single dose vaccine and $80 for a double dose vaccine, for which, previously, Medicare reimbursed providers about $28 and $45, respectively. The exact payment rate for administration of each dose of a COVID-19 vaccine will depend on the type of entity that furnishes the service and will be geographically adjusted based on where the service is furnished.

Governor Murphy Makes an Investment in the Future of New Jersey’s Offshore Wind Industry

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New Jersey has set an ambitious goal to supply 7,500 MW of offshore wind energy to the State by 2030. In order to meet this goal, New Jersey will be required to provide port services to support the development of offshore wind farms. To that end, Governor Murphy included $200 million in the State’s budget to construct an offshore wind port located in Salem County. Moreover, the facility will be utilized for manufacturing, marshalling and supply chain activities. This is in addition to the $250 million pledged by Orsted and EEW Group, a German large-scale pipe manufacturer, to build a facility at the Paulsboro Marine Terminal that will manufacture monopiles, which serve as foundations for offshore wind turbines. This significant investment in offshore port facilities will allow New Jersey to not only promote wind farm development off its coast but also become a hub for the growing offshore wind industry along the entire East Coast.

The Salem County Wind Port and Paulsboro Marine Terminal will provide docking facilities for vessels used in the construction, cabling and maintenance of wind turbines. These facilities will have areas where wind turbine components can be manufactured, staged and assembled prior to transport to the offshore wind farms. There are a number of considerations when designing an offshore wind port facility, including sufficiently sized storage capacity for the extremely large wind turbine components and the ability to support the weight of such components and foundations. Unfortunately, unlike Europe, the United States does not have significant coastal land area to develop mega-ports, which are the most useful for the industry. Therefore, states along the East Coast seem more likely to develop an integrated port network to ensure that the offshore wind developers have the facilities they need to complete their projects. The 200-acre-planned Wind Port in Salem County and the 190-acre Paulsboro Marine Terminal are anticipated to be an integral part of this network.

Moreover, the recently enacted National Defense Authorization Act for Fiscal Year 2021 dispelled any question as to whether the Jones Act will apply to offshore wind farms located on the Outer Continental Shelf. The Defense Authorization Act clarified that the Outer Continental Shelf Lands Act covers facilities producing non-mineral energy sources attached permanently to the Outer Continental Shelf, such as wind turbines, thus, making these turbines subject to federal law. This in turn will require developers to utilize Jones Act compliant vessels (vessels that are US owned and operated) when transporting wind turbine components from a US port to the wind farm for construction, operation or maintenance. Therefore, the ability to manufacture wind turbine components at a US port is critical to the development of offshore wind along the Eastern seaboard.

Development of the ports are likely to invoke environmental justice concerns, which is a priority for the Murphy Administration. The Salem County Wind Port and the Paulsboro Marine Terminal, both located near identified overburdened communities, will almost certainly provide jobs to individuals living in these communities in construction, manufacturing, loading, marshalling and maintenance of the turbines. The Town of Grimsby located in the United Kingdom is an example of a community that benefitted from the development of a port facility to support offshore wind. Grimsby was a struggling fishing village, but that changed when an offshore wind port brought a supply chain of manufacturers, suppliers, support vessels and services to the Town. In a short period of time, Grimsby saw significant economic growth and opportunity because of the offshore wind industry, which can be a model for Salem and Paulsboro.

But, along with anticipated economic growth, the operations at the Salem County Wind Port and the Paulsboro Marine Terminal could result in environmental and health impacts to the surrounding communities. As the ports develop into a hub for the East Coast offshore wind industry, there could be an impactful increase in vessels and other transportation vehicles, which in turn could be detrimental to air quality in the region. Additionally, manufacturing facilities could increase air emissions, water discharges and the generation of waste. Although there is strong support for renewable energy, New Jersey is likely to consider and address, along with beneficial growth, the potential environment and health concerns in offshore wind port areas.

While this is just the beginning, Governor Murphy’s $200-million investment in creating the Salem County Wind Port and the $250-million venture at the Paulsboro Marine Terminal bring not only the anticipation of jobs and growth to the area, but they also begin to solidify New Jersey’s role as an integral part of the offshore wind industry.

For more information, please contact the author Laurie Sands or any attorney in our Environmental Practice Group.

New York Federal Court Holds “No Obligation to Renew” Language in Collection Letter Does Not Violate Fair Debt Collection Practices Act

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The United States District Court for the Southern District of New York recently held that a debt collector does not violate the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq. (“FDCPA”) when it sends a collection letter that, among other things, states that the collector “is not obligated to renew this offer.”  See Rajkumar v. FBCS, Inc., 2021 WL 949867 (S.D.N.Y. Mar. 12, 2021).  A debt collector sent “substantively identical” collection letters to the two named Plaintiffs in this case. The body of the letter stated that the current creditor had “authorized [the collector] to accept a reduced amount to resolve [Plaintiff’s] account,” and then provided various options for how the debtor could pay the reduced amount. Notably, one of the options provided in the letter was to pay a certain down payment and then pay a “remaining balance . . . 30 days after [the] 1st payment is received.” The back of the letter went on to state that “[the collector] is not obligated to renew this offer.” Lastly, the back of the letter also provided notices regarding the prohibition by law of the use of abusive, deceptive, and misleading debt collection efforts by collectors as well as certain types of income that may not be taken to pay debts in the event a money judgment is rendered against a debtor in court. Plaintiffs brought a putative class action in the Southern District on behalf of others who had received collection letters from this particular collector under the FDCPA, alleging four violations: (1) that the “debtor is not obligated to renew this offer” language “could lead the least sophisticated consumer to believe that Defendant is not obligated to accept disputes” nor send a verification of the debt or other certain required information upon Plaintiff’s request; (2) that the letter did not make clear that the consumer could dispute the debt in writing, as the letter provided multiple addresses by which the letter’s recipient could respond to the debt collector; (3) that the offer to make a down payment, then pay the remaining balance within thirty days violated the FDCPA because it was open to multiple interpretations as to when the thirty days expired; and (4) that the required validation notice was “buried” within its text, making the reader “uncertain” about or likely to “overlook” her rights. The debt collector filed a motion to dismiss the complaint for failure to state a claim.

The District Court granted Defendant’s motion to dismiss. The Court initially noted that, “In the Second Circuit, the question of whether a communication complies with the FDCPA is determined from the perspective of the ‘least sophisticated consumer.’” Here, the Court found that, reading the letter as a whole, the least sophisticated consumer would be able to understand that the “offer” that debtor was not required to renew, based on the letter’s language, was the reduced payment amount and various payment options given to satisfy the debt, not any other required notices or options related to disputing or inquiring about said debt. Second, the Court found that the letter still made clear that the debtor could respond in writing, despite collector’s use of multiple addresses, since “Defendant’s address . . . appears below Defendant’s name three times.” The Court also found that “the option to make a down payment and then pay the remaining balance after the initial payment is received is not misleading or in violation of the FDCPA,” and “the placement of the validation notice” did not violate the Act where it was “legible . . . among other important information” and “not printed in a smaller font, or overshadowed by other large or bold font.” As a result, “nothing about the collection letter at issue . . . leads to the conclusion that the recipient would be duped into validating a debt she did not owe” and therefore, Defendant’s motion to dismiss the FDCPA claims were granted.

For a copy of the decision, please contact Michael O’Donnell at modonnell@riker.com, Desiree McDonald at dmcdonald@riker.com, or Andrew Raimondi at araimondi@riker.com.

Fifth Circuit Affirms Summary Judgment in Favor of Title Insurer on Mechanic’s Lien Issue

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The United States Court of Appeals for the Fifth Circuit recently affirmed a District Court’s decision granting summary judgment to a title insurance company, holding that the insured was not entitled to coverage for loss caused by a mechanic’s lien where the insured agreed to remove Covered Risk 11(a) in the title insurance policy. See Hall CA-NV, L.L.C. v. Old Republic Nat'l Title Ins. Co., 2021 WL 912726 (5th Cir. Mar. 10, 2021). In the case, Plaintiff insured agreed to fund renovations for the Cal-Neva Lodge & Casino on the condition that the general contractor on the project agree in writing to subordinate any potential liens in favor of Plaintiff. Plaintiff purchased both California and Nevada Title insurance policies from Defendant and signed standard ALTA Form 32-06. In so doing, Plaintiff agreed to remove the Standard ALTA form’s Covered Risk 11(a), which protects insureds against any “loss or damage . . . by reason of . . . [t]he lack of priority of the lien of the Insured Mortgage . . . over any statutory lien for services, labor, or material arising from construction of an improvement or work related to the Land when the improvement or work is . . . contracted for or commenced on or before Date of Policy.” After Plaintiff stopped advancing funds for the project and payments to the contractor ceased, the contractor filed and began foreclosing on mechanic’s liens, claiming that its liens had priority because they related back to the contractor’s initial work performed before Plaintiff provided funding for the project. Defendant hired counsel to provide dual representation to Plaintiff and another lender in the action, which was removed to federal bankruptcy court and eventually settled. Defendant refused, however, to indemnify Plaintiff for the loss incurred as a result of the lien priority. Plaintiff then sued for breach of contract, among other claims. The District Court granted summary judgment in favor of Defendant, finding that although the “unpaid [contractor] pre-policy date work” is a “defect” under Covered Risk 2 and an “encumbrance” under Covered Risk 10, coverage is precluded by Exclusions 3(a) and 3(d) of the policy, as discussed in a prior blog post.

On appeal, the Court affirmed. The Court first noted that the threshold question is whether the policy covered the claimed losses. Plaintiff argued on appeal that the lien losses were insured under Covered Risks 2 and 10, which provided that “Old Republic ‘insures as of Date of Policy’ against losses ‘sustained or incurred . . . by reason of . . . [a]ny defect in or lien or encumbrance on the Title’ or ‘[t]he lack of priority of the lien of the Insured Mortgage upon the Title over any other lien or encumbrance.’” In rejecting this argument, the Court found that Covered Risks 2 and 10 did not cover the lien losses as issue because the parties signed standard ALTA Form 32-06, which not only eliminated Covered Risk 11(a) but “replace[d] the provision with substantially narrower coverage.” Moreover, even if the 32-06 endorsement and the general provisions of the Covered Risks resulted in ambiguity regarding coverage, the specific provision (the endorsement) instructed that no such coverage exists, and under the basic principle of contract interpretation, the specific provisions control. Because the Court found that Plaintiff was not entitled to coverage under the policy, the Court did not address the District Court’s conclusions regarding Exclusions 3(a) and 3(d). Second, the Court found that because Plaintiff was not entitled to indemnification for loss arising from the lien, Plaintiff could not prove that Defendant acted in bad faith by denying its claim. Lastly, the Court found that Plaintiff failed to present evidence of harm resulting from Defendant’s failure to provide Plaintiff with separate counsel. Plaintiff’s vague testimony regarding additional expenses incurred, as well as counsel’s decision to leave the room during one mandatory mediated settlement agreement was insufficient to prove that there was a conflict of interest. Thus, the District Court properly granted summary judgment in favor of Defendant.

For a copy of the decision, please contact Michael O’Donnell at modonnell@riker.com, Desiree McDonald at dmcdonald@riker.com, or Andrew Raimondi at araimondi@riker.com.

Third Circuit Affirms NJ Doctrine of Necessaries Not Preempted by Equal Credit Opportunity Act

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In a recently published opinion, the United States Court of Appeals for the Third Circuit affirmed a finding that the Equal Credit Opportunity Act (“ECOA”), 15 U.S.C. § 1691 et seq., does not preempt New Jersey’s common law doctrine of necessaries that allows a creditor to seek collection of necessary expenses from the debtor’s spouse. See Klotz v. Celentano, Stadtmauer & Walentowicz LLC, 2021 WL 969479 (3d Cir. Mar. 16, 2021). The doctrine of necessaries provides that “both spouses are liable for necessary expenses incurred by either spouse in the course of the marriage,” and that a “non-debtor is liable for the debts of her spouse . . . if the assets of the spouse who incurred the debt are insufficient.” See, e.g., Jersey Shore Med. Ctr. Fitkin Hosp. v. Baum’s Est., 84 N.J. 137 (N.J. 1980) (Defining the doctrine and holding that wife would be liable to hospital for late husband’s medical bills, but holding was to be applied prospectively); Dubois, Sheehan, Hamilton & DuBois v. DeLarm, 243 N.J. Super. 175, 185-187 (App. Div. 1990) (wife liable to law firm for husband’s legal defense fees because “the family’s support, income and well-being may be affected by incarceration, loss of driver’s license or any other sentence of consequence.”).

In Klotz, a hospital retained a law firm to collect on a medical debt that had been incurred by Plaintiff’s husband, who passed away without paying the debt and left no estate. Following the mailing of two collection letters to Plaintiff, she sued the firm in the United States District Court for the District of New Jersey for an alleged violation of the Fair Debt Collection Practices Act (“FDCPA”), 15. U.S.C. § 1691 et seq., arguing that she was not liable for the debt and that the firm violated the FDCPA because its collection letters sought payment of a debt that she did not owe. The firm argued that Plaintiff had a legal obligation to pay the debt under the doctrine of necessities. In turn, Plaintiff argued that the ECOA, which makes it unlawful for creditors to discriminate based on certain criteria, including marital status, preempted the doctrine of necessaries. Among other things, the ECOA and its related regulations provide that “a creditor shall not require the signature of an applicant’s spouse . . . on any credit instrument if the applicant qualifies under the creditor’s standards of creditworthiness for the amount and terms of the credit requested.” Plaintiff thus argued that by the creditor imposing liability on her for her deceased husband’s debt under the doctrine of necessaries, she was effectively being treated as a spousal co-signer on his debt in violation of the ECOA, and therefore, the FDCPA. The law firm moved to dismiss the complaint, and the District Court granted the motion to dismiss. Plaintiff then moved for reconsideration and for leave to file an amended complaint with additional allegations, and that motion was also denied. Plaintiff then appealed.

The Third Circuit affirmed the judgment of the District Court. The Court first noted that in order for the ECOA to preempt New Jersey’s doctrine of necessaries, Plaintiff had to show that “compliance with both state and federal law [was] impossible, or where the state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.” Here, the ECOA allowed the Federal Reserve Board to exempt certain categories of transactions from its scope, and it exercised this authority in promulgating a regulation exempting “incidental credit” from its spousal signature prohibition. “Incidental credit” was further defined as extensions of consumer credit not made pursuant to the terms of a credit card account, not subject to a finance charge, and not payable by agreement in more than four installments. In this case, the medical debt at issue satisfied these three criteria, thus, it was incidental debt carved out from the ECOA. Thus, the Court found that “given that the spousal-signature prohibition does not apply, . . . the ECOA and its regulations do not conflict-preempt the doctrine of necessaries.” The Court also rejected Plaintiff’s alternative argument that the doctrine was preempted because it frustrates the purpose of the ECOA, as the statute is ultimately “focused on ensuring the availability of credit rather than the allocation of liability between spouses.” Lastly, the Court rejected alternative arguments that the firm did not comply with the procedural requirements of the doctrine of necessaries, which require the creditor to first seek to collect from the debtor spouse. The Court found that the debtor did not have an estate, and the firm was not required to seek administration of the estate since it would have been insolvent. It also found that allowing an amendment to her complaint in order to further clarify the nature of debt would be futile, because even with said clarifications, the debt at issue would still fall within the doctrine of necessaries. Given the foregoing, the Court affirmed the District Court’s judgment dismissing Plaintiff’s complaint.

This case is important because it makes clear that creditors may continue to collect debts under the doctrine of necessaries without fear of a violation of the ECOA, so long as the credit is “incidental” as set forth above. Here, because that was the case, and because the debt collector complied with the other formalities of the doctrine of necessaries, there was no claim.

For a copy of the decision, please contact Michael O’Donnell at modonnell@riker.com, Desiree McDonald at dmcdonald@riker.com, or Andrew Raimondi at araimondi@riker.com.

Arizona Court Holds Insured’s Inability to Subdivide Property Did Not Render It Unmarketable Under Title Policy

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The Arizona Court of Appeals recently affirmed a lower court’s decision granting summary judgment to a title insurance company, among others, holding that an insured did not have coverage under a title insurance policy for losses arising after the insured discovered a covenant that prohibited it from selling the property as individual units.  See VACC LLC v. Chicago Title Ins. Co., et al., 2021 WL 710793 (Ariz. Ct. App. Feb. 23, 2021). In December 2013, Plaintiff purchased a parcel of land (the “Property”) with the intent of developing single-family residences for sale. Chicago Title Agency (“CTA”), the escrow agent under the purchase agreement, obtained a title insurance policy (the “Policy”) for Plaintiff from Chicago Title Insurance Company (“Chicago Title”). Plaintiff’s predecessor in interest recorded covenants, conditions, and restrictions (“CC&Rs”) stating that the “declarant intends to lease portions of the Lots to be used as the sites for residential dwellings.” The Property also was subject to a plat (the “Plat”) that incorporated the lease restriction. The following year, a potential purchaser’s title agency discovered that the Property was platted as one large lot, rather than individual lots. Plaintiff filed a claim under the Policy, asserting that the Property was unmarketable and seeking to recover the costs associated with amending the Plat. Chicago Title investigated the claim and subsequently denied coverage. Plaintiff then brought an action against CTA and Chicago Title seeking compensatory and punitive damages for: (1) breach of contract; (2) breach of the duty of good faith and fair dealing; (3) breach of fiduciary duty; and (4) bad faith. The trial court granted summary judgment in favor of CTA on all counts, and granted summary judgment in favor of Chicago Title with regard to Plaintiff’s claims for bad faith and breach.  It denied summary judgment on the breach of contract claim based on the “reasonable expectations” of the parties. Thereafter, Chicago Title moved for reconsideration on the contract claim, asserting that an analysis of the parties' “reasonable expectations” is only relevant in the context of a non-negotiated contract. In granting the motion, the trial court agreed with Chicago Title’s position, and further determined that the lease restriction in the Plat did not make the Property unmarketable.

On appeal, the Court affirmed. First, the Court held that the trial court properly granted summary judgment in favor of CTA because “there was no question that [Plaintiff] was aware that [Chicago Title] was the title insurer and the party which [Plaintiff] entered the contract.” Moreover, the Policy is a contract for title insurance, and because Plaintiff’s claims were premised on the rights and obligations created by the Policy, Plaintiff was required to show that CTA was a party to that contract, which it was not. Second, the Court held the trial court properly granted summary judgment in favor of Chicago Title. In doing so, the Court rejected Plaintiff’s claim that title to the Property was unmarketable because the lease restriction in the Plat did not allow for the sale of individual lots, and that the Policy covered costs incurred because of such unmarketability. In contrast, the Court found that “the Policy did not provide insurance for a specific use and instead insured title subject to the conditions in the Plat.” The Court further found that the insured “has not asserted that anyone else claimed an ownership interest in the Property, or that anything prevented [the insured] from conveying the same interest it acquired when it purchased the Property.”  Moreover, the Policy “expressly excluded ‘loss or damage, and . . . costs, attorneys’ fees or expense that arise’ because of ‘easements, covenants, conditions, and restriction as set forth on the plat.’” On appeal, Plaintiff also argued, among other things, that under the “reasonable expectations” doctrine, the parties’ intent controls, and here, the parties intended that the Policy would cover Plaintiff’s ability to sell the Property in individual units. In rejecting this argument, the Court noted that because the Policy was a negotiated agreement, the reasonable expectations did not apply. Lastly, the Court held that the trial court properly granted summary judgment in favor of Chicago Title with regard to Plaintiff’s claims for bad faith, breach of fiduciary duty, and breach of good faith and fair dealing. The Court found that Chicago Title denied coverage after a reasonable investigation and had a reasonable basis for doing so. Thus, summary judgment in favor of Chicago Title was proper.

For a copy of the decision, please contact Michael O’Donnell at modonnell@riker.com, Desiree McDonald at dmcdonald@riker.com, or Andrew Raimondi at araimondi@riker.com.

New Jersey Proposes New Statute on PBMs, CMS Expands Coverage for COVID-19 Testing and More

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For more information about this blog post, please contact Khaled J. Klele, Ryan M. Magee, or Labinot Alexander Berlajolli.

New Jersey’s Proposed Pharmacy Benefits Manager Licensure and Regulation Act

This bill, A5410, first introduced to the New Jersey Assembly on March 1, 2021, provides for the licensure of pharmacy benefits managers ("PBM"). Under the bill, the Commissioner of Banking and Insurance is to create the application for a license to operate in New Jersey as a PBM and establish the accompanying licensing, fees, application, financial standards, and reporting requirements of PBMs.

The bill also prohibits PBMs from imposing penalties on pharmacies that disclose to any covered person any healthcare information that the pharmacy or pharmacist deems appropriate regarding the nature of treatment, risks, or alternatives thereto, the availability of alternate therapies, consultations, or tests, the decision of utilization reviewers or similar persons to authorize or deny services, the process that is used to authorize or deny healthcare services or benefits, or information on financial incentives and structures used by the insurer.  Specifically, a pharmacy or pharmacist may provide to an insured information regarding the insured's total cost for pharmacist services for a prescription drug and offer more affordable alternatives.

If passed, the bill will apply to contracts or health benefit plans that are delivered, issued, executed, or renewed in New Jersey on or after January 1, 2022.

New Jersey Board of Medical Examiners Expands Role of Midwives

The Board of Medical Examiners has adopted a rule, 52 N.J.R. 366(a), to allow licensed midwives to administer nitrous oxide as a labor analgesia in licensed healthcare facilities. Specifically, the rule amends N.J.A.C. 13:35-2A.10 and 2A.12, so that licensed midwives may administer or facilitate the administration of nitrous oxide for pain relief during the intrapartum and postpartum stages when they are providing services in a healthcare facility licensed by the Department of Health. Although licensed midwives practice in a variety of settings other than healthcare facilities licensed by the Department of Health, including patients' homes, the rule acknowledges that many of these outpatient settings lack similar policies and procedures to ensure that nitrous oxide is safely stored and administered. Accordingly, the rule limits licensed midwives' ability to administer nitrous oxide as labor analgesia to licensed healthcare facilities only.

Health Insurers Now Required to Cover COVID-19 Testing for Asymptomatic People

In accordance with President Biden’s January 21, 2021 Executive Order, the Centers for Medicare & Medicaid Services (“CMS”), with the Department of Labor and the Department of the Treasury, issued new guidance increasing insurance coverage for COVID‑19 diagnostic testing without cost sharing. Under the guidance, private group health plans cannot use medical screening criteria to deny coverage for COVID‑19 tests for asymptomatic people or those without a known exposure to the virus. Tests must be covered without cost-sharing, prior authorization, or other medical management requirements imposed by the plan or issuer. Health plans also must cover point‑of‑care COVID‑19 tests and tests that are administered at a state or local testing site. For example, covered individuals wanting to ensure they are COVID-19 negative prior to visiting a family member would be able to be tested without paying cost sharing. Plans, however, may deny coverage for testing for public health surveillance or employment purposes if the individual is asymptomatic and does not have a suspected exposure to COVID‑19.   More information is available in CMS’s press release.

CMS Revises Nursing Home COVID-19 Visitation Recommendations

CMS, with the Centers for Disease Control and Prevention (“CDC”), issued updated guidance for nursing homes to safely expand visitation options during the COVID‑19 public health emergency. Per the guidance, facilities should allow responsible indoor visitation at all times and for all residents, regardless of vaccination status of the resident or visitor, unless certain scenarios arise that would limit visitation for:

  • Unvaccinated residents if: (1) the COVID-19 county positivity rate is greater than 10 percent; and (2) less than 70 percent of residents in the facility are fully vaccinated;
  • Residents with confirmed COVID‑19 infection, whether vaccinated or unvaccinated until they have met the criteria to discontinue transmission‑based precautions; or
  • Residents in quarantine, whether vaccinated or unvaccinated, until they have met criteria for release from quarantine.

For more information regarding the visitation guidelines, review CMS’s fact sheet and press release.

Washington Federal Court Holds Title Insurer Had No Duty to Defend Against Trespass Complaint

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The United States District Court, Western District of Washington recently held that a title insurer had no duty to defend against a third-party complaint alleging claims of trespass and relating to a private road which was excepted from its policy. Safeco Ins. Co. of Am. V. Fid. Nat’l Title Ins. Co., 2021 WL 252236 (W.D. Wash. Jan. 26, 2021). The Insureds were the owners of the northwest parcel of land in a group of four adjoining parcels, with a private road running between the Insureds’ parcel and the northeast parcel as well as between the other two parcels. Said private road was excepted from the land covered by the title insurance policy given to Insureds by their title insurance company. A dispute over the private road arose between the other three parcel owners in state court, and the Insureds alleged in an email to the Insurer that the defendants in that case were “hostilely taking over” their property. Those same defendants later filed a third-party complaint (“the TPC”) against the Insureds, alleging claims of trespass against the Insureds. The Insureds forwarded the TPC to the Insurer, and the claim was denied.  During discovery, the defendant neighbors also made a claim regarding a private road across the properties in their interrogatory responses.  Again, the Insureds made a claim and the Insurer denied based on the fact that the road was specifically excepted from coverage in the policy.  This denial resulted in a declaratory judgment action by the provider of the Insureds’ homeowners insurance (“Co-Insurer”) seeking an order declaring that Insurer had a duty to defend the Insureds in the underlying litigation. The Magistrate Judge for the Western District of Washington at Tacoma issued a Report and Recommendation (“R&R”), recommending that the Co-Insurer’s motion for summary judgment be denied and the Insurer’s cross motion for summary judgment should be granted.

The District Court found that the R&R of the Magistrate Judge should be adopted, and that the Insurer’s cross-motion for summary judgment should be granted. The Court found that as to the trespass claim, the Insurer had no duty to defend the trespass claims given the fact that the private road was specifically “excluded from the definition of the land covered under the policy,” as well as because the policy had an exclusion for “defects, liens, encumbrances, adverse claims, or other matters resulting in no loss or damage to the insured.” The court held that because the private road was not a part of the “land” covered by the policy to begin with, “there would be no resulting loss or damage to [the insured’s] property interest” whether or not the trespass claims regarding the private road were ultimately successful. More precisely, “[i]f the [Insureds] were found to have trespassed on [their neighbor’s] property when they filled a drainage ditch, removed, trees, or removed stakes, the [Insureds] would not have suffered a loss or damage because they never owned the property. The same is true if the [Insureds] were found to have not trespassed; they continued to maintain ownership in the property wherein they filled the ditch, removed trees, or removed stakes.” The Court also found that there was no duty to defend the private road claims because the claims were related to the road that was excepted from coverage in the policy. Therefore, neither the TPC nor the subsequent interrogatory responses triggered Insurer’s duty to defend under the title policy.

For a copy of the decision, please contact Michael O’Donnell at modonnell@riker.com, Desiree McDonald at dmcdonald@riker.com, or Andrew Raimondi at araimondi@riker.com.

New Jersey Federal Court Holds No Discrimination Claim When Bank Declined to Honor PPP Transactions

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The United States District Court for the District of New Jersey recently dismissed a suit for racial discrimination and retaliation brought by a bank account holder against a national bank, holding that the account holder had not sufficiently pled facts alleging racial discrimination when the bank ceased to honor checks and electronic payments related to the Paycheck Protection Program (“PPP”). Re Republic Grp. LLC v. Bank of Am., N.A., 2021 WL 321477 (D.N.J. Feb. 1, 2021). Plaintiffs were New Jersey residents and the founders of multiple companies whose purposes were to “provide cash flow and investment opportunities to small and diverse businesses and individuals.” They gained approval from the Small Business Administration to issue PPP loans to minority-owned businesses and deposited approximately $100 million in their business account with the defendant bank. The bank later “refused to honor checks or electronic payments presented against” this account and informed Plaintiffs that it was unable to support their efforts to participate in the PPP program. Plaintiff brought claims for discrimination and retaliations under 42 U.S.C. § 1981 as well as the New Jersey Law Against Discrimination and the New Jersey Civil Rights Act, claiming that the bank “never provided a legitimate, lawful, or non-discriminatory reason” for refusing to honor the checks and payments. Defendant moved to dismiss the complaint for failure to state a claim upon which relief can be granted.

In a letter opinion, the District Court granted the defendant bank’s motion to dismiss. Although the Plaintiff claimed no legitimate reason was given for refusing to honor PPP-related checks and payments, and also alleged that the bank subsequently closed their related personal and business accounts, their claims failed because they did not “plead facts that show that Defendants intended to discriminate against them because of their race.” Although plaintiffs pled that they were members of a racial minority, they did not “plead that they were treated differently than any other individuals or businesses who are not members of a protected class.” Therefore, Plaintiffs conclusions, “without support,” that the bank’s decision to decline these transactions with motivation to discriminate were not sufficient to support a claim. As a result, “Plaintiffs’ Section 1981 claims,” as well as the New Jersey State claims, over which “the Court decline[d] to exercise supplemental jurisdiction,” were dismissed.

For a copy of the decision, please contact Michael O’Donnell at modonnell@riker.com, Desiree McDonald at dmcdonald@riker.com, or Andrew Raimondi at araimondi@riker.com.

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