Search Icon
New York Federal Court Grants Debt Collector’s Motion for Judgment on the Pleadings in FDCPA Action Banner Image

New York Federal Court Grants Debt Collector’s Motion for Judgment on the Pleadings in FDCPA Action

Month: July 2021

New York Federal Court Grants Debt Collector’s Motion for Judgment on the Pleadings in FDCPA Action

Posted on by rd_admin

The United States District Court for the Eastern District of New York recently granted a debt collector’s motion for judgment on the pleadings, finding that so long as a debt collector either accurately informs the consumer that the amount of the debt stated in the letter will increase over time, or clearly states that the holder of the debt will accept payment of the amount set forth in full satisfaction of the debt if payment is made by a specified date, the debt collector will not be liable under the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. §1692e. See Klein v. Forster & Garbus, LLP, 2021 WL 2646334 (E.D.N.Y. June 28, 2021). In the case, a debt collector sent the plaintiff a collection letter (the “Letter”), which provided that the plaintiff had an outstanding balance and that, “[i]f interest or other charges or fees accrue on this account, after the date of this [L]etter, the amount due on the day you pay may be greater.” The plaintiff subsequently brought a putative class action against the debt collector, alleging violations of the FDCPA. Specifically, the plaintiff alleged that the Letter was misleading because it “merely allude[d] to the possibility of interest accruing[,]” when, in fact, “[the debt collector was] well aware that interest [was] definitely accruing[.]” The plaintiff further alleged that the Letter used language that was confusing to the plaintiff since it was “unclear as to whether or not the account was actually, currently accruing interest when it simply could have stated that interest was accruing.” The debt collector moved for judgment on the pleadings.

The Court granted the debt collector’s motion. First, it found that although the plaintiff asserted that he “[brought] this class action on behalf of a class of New York consumers[,]” he failed to allege that he is a consumer. Next, the Court held that the plaintiff failed to adequately plead that the Letter was misleading under the FDCPA. Relying on Avila v. Riexinger & Assocs., LLC, 817 F.3d 72 (2d Cir. 2016), the Court found that the Letter provided the safe harbor language set forth by the Second Circuit. The Court explained that Avila did not require debt collectors to use “any particular disclaimer.” Rather, so long as a debt collector “either accurately informs the consumer that the amount of the debt stated in the letter will increase over time, or clearly states that the holder of the debt will accept payment of the amount set forth in full satisfaction of the debt if payment is made by a specified date[,]” the debt collector will not be liable under 15 U.S.C. §1692e. In doing so, the Court rejected the plaintiff’s argument that by using the conditional “if,” the least sophisticated consumer is left with “no reasonable basis to determine whether interest is accruing on the account.”

The plaintiff further argued, to no avail, that the Letter violated 15 U.S.C. §1692e because the body contained “no explicit reference to an 800-number”. The Court found, however, that “[d]ebt collection letters are to be read in their entirety.”  Here, the top right corner of the Letter listed: (1) a toll-free number with an extension; (2) the name of the representative assigned to the collection; and (3) the debt collector’s operating hours. Further, the second line of the Letter stated, “[i]n order to pay your indebtedness, and satisfy the judgment, contact our office to make arrangements to pay.”  Finally, the Court denied the plaintiff’s informal request for leave to amend the Complaint with respect to the allegations regarding the Letter's failure to disclose whether interest was accruing and to add an allegation that the Letter violated 15 U.S.C. §1692e because it falsely implied that the debt collector had a legal right to collect fees and other charges. The Court found that, among other things, the proposed amendment would be futile. Given the foregoing, the Court granted the debt collector’s motion for judgment on the pleadings and denied the plaintiff leave to amend the Complaint.

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

Riker Danzig Releases Episode 2 of Title Insurance Podcast

Posted on by rd_admin

On July 29, 2021 Riker Danzig released Episode 2 of “Title Nerds,” the Firm’s title insurance podcast.  Title Nerds hosts Mike O’Donnell and Bethany Abele welcome fellow Riker Danzig attorneys Ron Ahrens and Mike Crowley to the podcast.  In the first segment, Mike O’Donnell and Ron Ahrens talk about coverage investigations in the context of title insurance, drawing on some of their experiences in uncovering fraud and collusion, as well as issues in more routine fact-based investigations. They cover the analysis of covered claims, including what issues are probed, the Eight Corners Doctrine and beyond, privilege issues when a challenge to title is being litigated at the same time a coverage investigation is ongoing, and common exclusions and exceptions.   Next, Bethany Abele interviews Mike Crowley about the 11th Circuit’s In re Lindsey case (2021 WL 140661 11th Cir.), which raises two issues of interest to title insurers.  First, the case addresses whether a Bankruptcy Court can retain jurisdiction over an adversary complaint seeking quiet title after the debtor dismisses the bankruptcy action.  Second, it analyzes the Court’s decision to reform a deed to include the debtors’ 50% interest even though the seller failed to sign individually and later claims he never intended to do so, as the evidence all points to the intention to convey his interest through the bankruptcy. 

Episode 1, which was released on May 14, 2021, covered the Fifth Circuit’s Hall v. Old Republic case, “Daniel’s Law,” the Planned Real Estate Development Full Disclosure Act /Homeowner’s Association Fees Corrective Bill as well as a bill encouraging the Timely Recording of Residential Deeds.

Guam v. U.S. and CERCLA Claims in New Jersey

Posted on by rd_admin

Cost Recovery or Contribution?  Impacts of Guam on the Timeliness of CERCLA Claims in the Third Circuit and New Jersey

The recently concluded Supreme Court term was an exciting one for environmental lawyers, as the Court in Guam v. United States made a rare foray into interpreting the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), specifically considering the impact of certain settlements on statutes of limitations under CERCLA.  As in its 2004 decision in Cooper Industries v. Aviall Services, the Court’s interpretation of CERCLA in Guam differed from the previously prevailing interpretation of most federal circuits.  That is, the Court overruled prior decisions of several federal circuits, including the Third Circuit, and held that settlements of liability under environmental laws other than CERCLA do not trigger a contribution claim under CERCLA section 113.  In so doing, the Court revived Guam’s $160 million CERCLA claim against the U.S. government, which the lower courts had held to be time barred.  For parties conducting cleanups within Third Circuit jurisdictions, Guam gives new life to CERCLA claims that might have been understood to be untimely, and it also has important consequences for parties seeking reimbursement for cleanup costs in New Jersey, particularly those with claims against the federal government.

The Supreme Court case centered on Guam’s Ordot Dump, at which the Navy allegedly deposited hazardous substances before ceding the dump to Guam as a public landfill.  The United States Environmental Protection Agency sued Guam under the Clean Water Act for contamination caused by the landfill, which resulted in a 2004 consent decree.  Then, in 2017, Guam sued the United States under CERCLA to recover its costs to clean up the landfill.  Both the D.C. District Court and the D.C. Circuit dismissed Guam’s claim as untimely.  First, the lower courts held that a cost recovery claim under CERCLA section 107 and a contribution claim under CERCLA section 113 are mutually exclusive remedies; that is, if a party could have brought a contribution claim, it cannot bring a cost recovery claim.  Second, the 2004 Clean Water Act settlement made Guam a “person who has resolved its liability to the United States … for some or all of a response action or for some or all of the costs of such action in [a] settlement” under CERCLA section 113(f)(3)(B) and thus eligible to bring a CERCLA contribution claim as of 2004.  Because the statute of limitations for a CERCLA contribution claim expires three years after a plaintiff enters into a qualifying settlement, Guam’s 2017 lawsuit was untimely.

The Supreme Court disagreed.  The Court held that CERCLA contribution requires resolution in a settlement of CERCLA-specific liability, and Guam’s settlement under the Clean Water Act did not qualify.

The most direct consequence of Guam for litigants in Third Circuit jurisdictions is the revival of CERCLA claims that would have been classified as contribution claims and considered untimely.  Guam overturns the Third Circuit’s holding in Trinity Industries, Inc. v. Chicago Bridge & Iron Co., 735 F.3d 131 (3d Cir. 2013), that a settlement with a state agency that did not resolve CERCLA liability can trigger a CERCLA contribution claim.  After Guam, when these claims are categorized as cost recovery claims under CERCLA section 107, they will be subject to a longer statute of limitations—in most cases, six years following initiation of on-site construction of the remedial action—rather than the shorter statute of limitations for CERCLA contribution claims of three years following the entry into a settlement.  The CERCLA contribution/cost recovery distinction is less important for litigants in New Jersey than for those in other states with respect to the timeliness of claims, as the New Jersey Spill Act provides a comparable remedy to CERCLA, and Spill Act claims are not subject to any statute of limitations following the New Jersey Supreme Court’s decision in Morristown Associates v. Grant Oil Co., 220 N.J. 360 (2015).

Nevertheless, parties with claims against the federal government for remediation costs in New Jersey should be particularly cognizant of the CERCLA issues implicated in Guam because the federal government likely has sovereign immunity from Spill Act claims, but not CERCLA claims.  For example, the plaintiff in Cranbury Brick Yard, LLC v. United States, 943 F.3d 701 (3d Cir. 2019), lost its $56 million claim for contamination allegedly caused by the military because the claim was held to be a CERCLA contribution claim and, thus, untimely.  (Notably, the result in Cranbury Brick Yard would have been the same even under the new Guam rule because the settlement with NJDEP that triggered a CERCLA contribution claim specifically resolved Cranbury Brick Yard’s CERCLA liability to New Jersey.)

The predominant “settlement” of liability for remediation costs in New Jersey is the covenant not to sue from NJDEP that accompanies a response action outcome under N.J.S.A. 58:10B-13.2.  Under the Guam framework, the recipient of an RAO likely would have a CERCLA cost recovery, not contribution, claim because the covenant not to sue does not settle a CERCLA-specific liability.  And, although Guam concerned whether a settlement triggered a contribution claim under CERCLA section 113(f)(3)(B), its reasoning would apply with equal force to determine whether a settlement grants contribution protection under section 113(f)(2).  Thus, the recipient of an RAO likely could not rely on contribution protection from CERCLA claims by other potentially responsible parties.  In contrast, the recipient of an RAO does benefit from contribution protection for Spill Act claims.  N.J.S.A. 58:10-23.11f.a.(2)(b).

In Guam, the Supreme Court again overturned the CERCLA precedents of several circuits.  Parties that have entered or will soon enter settlements with the government of liability for environmental remediation should be aware of the new regime established by Guam.

For more information, please contact the author Michael Kettler at mkettler@riker.com or any attorney in our Environmental Practice Group.

Once Again, CMS Retracts Major Policy Decision

Posted on by rd_admin

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

CMS Continues to Reverse Some Policy Decisions With Its Release of the Outpatient Prospective Payment System Proposed Rule

Centers for Medicare & Medicaid Services (“CMS”) released its Outpatient Prospective Payment System (“OPPS”) proposed rule for 2022, which reverses some of last year’s major policy changes that were applauded by ambulatory surgery centers (“ASCs”). Significantly, CMS proposes reinstatement of the inpatient‑only (“IPO”) list. Under the proposed rule, the 298 services removed from the IPO list this year would be added back to the IPO list in 2022. CMS also proposes eliminating the 258 procedures added to the ASC covered procedures list in January 2021.

The proposed rule continues with more bad news for hospitals. For example, CMS decided to increase the penalties for failure to comply with its price transparency rule. Hospitals with more than 30 beds in violation of the rule would pay $10 per day for each bed, up to $5,500 per day. Hospitals with 30 beds or fewer would continue to pay up to $300 per day. This would make the annual penalty at least $109,500.  The penalties could go as high as $2 million a year for large hospitals. Making matters worse, the proposed rule is continuing its lower payment rates for 340B drugs by proposing to pay hospitals 22.5 percent less than the average sales price for 340B-acquired drugs.

The proposed rule is set to increase the OPPS rates by 2.3 percent in 2022, which would yield an estimated $82.7 billion in payments to providers, up about $10.8 billion from 2021.

Comments are due September 17, 2021.

CMS Releases Physician Fee Schedule Proposed Rule

86 FR 39104 – CMS released its Physician Fee Schedule (“PFS”) proposed rule for 2022. Controversially, at a time where physicians’ practices have been severely impacted by the COVID‑19 pandemic, resulting in a logjam of patients in need of surgical care, the proposed rule decreases the conversion factor to $33.58, down from $34.89 in 2021. CMS also noted that the 3.75 percent payment increase from the Consolidated Appropriations Act of 2021 is set to expire at the end of this year, which will result in reduced payments to physicians.

The rule proposes further expansion of telehealth, including, but not limited to, reimbursing providers for certain mental and behavioral healthcare services, allowing Medicare patients to access telehealth services from their homes, eliminating certain geographic restrictions, and using audio‑only communication technology for the diagnosis, evaluation, or treatment of mental health disorders. Additionally, CMS proposes extending coverage of certain services added to the Medicare telehealth list during the pandemic through December 31, 2023, to give CMS more time to evaluate whether the services should be permanently added to the telehealth list.

CMS also proposes increasing the Merit-based Incentive Payment System performance threshold score, allowing physician assistants to bill Medicare directly, and giving accountable care organizations more time to transition to electronic reporting.

Comments are due September 13, 2021.

New Jersey Enacts Legislation Permanently Authorizing Remote Notarizations and Requiring Education Courses for Notary Publics

Posted on by rd_admin

On July 22, 2021, New Jersey Governor Phil Murphy signed into law A-4250/S-2508, which permanently authorizes remote online notarizations and requires education courses for notary publics. The law takes effect on October 20, 2021.

New Jersey previously enacted A-3903/S-2336, which temporarily authorized remote notarizations during the COVID-19 Public Health Emergency and State of Emergency declared by Governor Murphy in Executive Order 103 on March 9, 2020.1 Although Governor Phil Murphy signed into law A-5820/S-3866 and Executive Order No. 244 on June 4, 2021, ending the COVID-19 Public Health Emergency, the State of Emergency remains in effect.

Like A-3903/S-2336, the Act authorizes a notary located in New Jersey to notarize the signing of a document or perform any other notarial act using “communication technology”2 for “a remotely located individual,” provided that: (1) the notary has “personal knowledge” or has obtained satisfactory evidence of the signatory’s identity either by (a) oath or affirmation from a credible witness appearing before the notary, or (b) using at least two different types of “identity proofing”; (2) the notary is reasonably able to confirm that a record before him/her is the same record the remote individual signed or in which the remote individual made a statement; and (3) the notary, or a third party on his/her behalf, creates an audio-visual recording of the performance of the notarial act, which must be retained by the notary public for a period of ten years.

A notary may verify the identity of a remotely located individual through “identity proofing” by means of: (1) a passport, driver’s license, or government-issued, non-driver identification card, which is current or expired not more than three years prior to the remote notarization; or (2) another form of government-issued, non-driver identification card, which is current or expired not more than three years prior to the remote notarization, and which contains the individual’s signature or photograph and is satisfactory to the notary.

Further, it is important to note that if a notarial act is performed using communication technology, the notary certificate on the document must indicate that the notarial act was performed using communication technology.

For a remotely located individual located outside the United States, the Act requires that: (a) the record: (1) be filed with or must relate to a matter before a public official or court, governmental entity or other entity subject to U.S. jurisdiction; or (2) involve property located in the territorial jurisdiction of the United States, or involve a transaction substantially connected with the United States; and (b) the act of making the statement or signing the record must not be prohibited by the foreign state in which the remote individual is located.

The Act does not, however, apply to the notarization of a record to the extent such record is governed by: (1) a law governing the creation and execution of wills and codicils; (2) the Uniform Commercial Code of New Jersey, N.J.S. 12A:1-101 et seq., other than N.J.S. 12A:1-107 (“Section Captions”), N.J.S. 12A:1-206 (“Presumptions”), the provisions of the “Uniform Commercial Code – Sales” (chapter 2 of Title 12A of the New Jersey Statutes), and the provisions of the “Uniform Commercial Code – Leases” (chapter 2A of Title 12A of the New Jersey Statutes); or (3) a statute, regulation or other rule of law governing adoption, divorce or other matters of family law.

New Jersey joins a growing list of states that have enacted some form of permanent remote online notarization legislation. As of July 26, 2021, those other states include: Alaska, Arizona, Arkansas, Colorado, Florida, Hawaii, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin and Wyoming.

Finally, the Act also sets forth new education requirements for notary publics. Specifically, an individual applying for an initial commission as a notary must now complete a six-hour course, within the six-month period immediately preceding the application, prescribed and approved by the State Treasurer. An individual applying to renew his/her notary public commission who has previously completed the six-hour course must complete a three-hour continuing education course.

For a copy of A-4250/S-2508, please contact Michael O’Donnell at modonnell@riker.com or Desiree McDonald at dmcdonald@riker.com.

_______________________

1 Our prior alert on A3903/S-2336, which passed the New Jersey Legislature on April 14, 2020 is available here.

2 “Communication technology” is defined as an electronic device or process that allows a notarial officer and a remotely located individual to communicate with each other simultaneously by sight and sound.

New Jersey Trial Court Finds No Affirmative Cause of Action Against Banks under New Jersey Uniform Fiduciaries Law

Posted on by rd_admin

A New Jersey trial court recently granted summary judgment in favor of a national bank, finding that the New Jersey Uniform Fiduciaries Law (“UFL”) does not permit an affirmative cause of action against a bank and that the bank had no legal obligation to investigate alleged improper transfers made pursuant to a Power of Attorney. See Estate of Ralph Sandor v. Wells Fargo Clearing Services, et al., Docket No. BER-C-54-21.  In 2013, Ralph Sandor (the “Decedent”) opened a custodial brokerage account with Wells Fargo and authorized the transfer of his accounts from another bank. Prior to opening the account, a Wells Fargo employee spoke with the Decedent over the phone to confirm the transfer and the validity of a 2013 Power of Attorney (the “POA”) that authorized the Decedent’s nephew to transact business on the Decedent’s behalf. In November 2015, a note was allegedly placed on the Decedent’s account that the Decedent was no longer able to competently make decisions for himself. However, in July 2016, the Decedent executed a form to change his brokerage account to a transfer-on-death account with the Decedent’s nephew as the sole primary beneficiary. To ensure that such change was the Decedent’s intent, a Wells Fargo employee conferred with the Decedent’s attorney, who confirmed. One month later, after the brokerage account was changed to a transfer-on-death account, the Decedent opened a new brokerage account with Wells Fargo and asked that the POA information be cross-referenced with his new account. According to Wells Fargo, it processed the POA as a “full POA” according to Wells Fargo’s internal policies and associated the Decedent’s nephew with the new account. Through the POA, the Decedent’s nephew allegedly transferred hundreds of thousands of dollars to himself and others. After the Decedent passed away, the Administrator of the Decedent’s Estate brought a claim against Wells Fargo for negligence and violation of the Uniform Fiduciaries Law, asserting that Wells Fargo was liable for the improper transfers and, among other things, seeking to recover the sums transferred out of the accounts. Wells Fargo subsequently moved for summary judgment.

The Court granted Wells Fargo’s motion. First, it found that the Administrator’s claim for violation of the UFL must be dismissed because the UFL does not create an affirmative cause of action against Wells Fargo. Rather, “the UFL provides a defense when a bank is sued for failing to take notice of and action on a fiduciary’s obligation.” The Court then found that the Administrator’s claim for negligence against Wells Fargo also failed for a number of reasons. First, the Court noted that in New Jersey, a tort remedy does not arise from a contractual relationship unless the breaching party has an independent duty imposed by law. Here, the relationship between the Decedent and Wells Fargo was based on a contract and there was no independent duty of Wells Fargo to the Decedent. Next, the Court found that even if the Administrator were permitted to pursue a negligence claim against Wells Fargo, the Administrator was unable to show the applicable standard of care and a breach thereof. The Administrator relied solely upon Wells Fargo’s internal policies, which “‘standing alone . . . cannot demonstrate the applicable standard of care.’” The Court also found that even to the extent that the Administrator was able to show the standard of care and a breach thereof, the Administrator nevertheless failed to overcome the liability shield created by the UFL. The Court noted that the UFL provides a bank with limited immunity against claims “‘…unless the bank acts in bad faith or had actual knowledge of a fiduciary breach.’” Here, there was no evidence of bad faith or actual knowledge that the transfers were ultra vires. Specifically, Wells Fargo was provided with a copy of the POA, upon which the transfers from the Decedent’s Wells Fargo account were based. The POA also expressly waived any liability against Wells Fargo stating, in pertinent part, that the “[p]arties may rely upon the representations of my agent [the nephew] as to all matters related to any power granted to my agent, and no person who may act in reliance upon the representations of my agent or the authority granted to my agent shall incur liability to me or my estate as a result of permitting my agent to exercise any power.’” Further, the checks and transfers that were intended to be delivered to the Decedent or his nephew were deposited into accounts bearing their respective or joint names. Finally, the Court noted that because Wells Fargo did not have actual knowledge that the Decedent’s nephew was purportedly breaching his fiduciary duties to the Decedent, and because none of the transfers made to third parties were initially intended for the Decedent or his nephew, “Wells Fargo was under no legal obligation to investigate transfers that otherwise conformed with those immunized by the UFL.” Accordingly, the Court granted summary judgment in favor of Wells Fargo and dismissed the claims with prejudice.

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

Fifteen New Statutes in New Jersey Impacting Healthcare

Posted on by rd_admin

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

As a follow-up to our previous post, below is a list of fifteen New Jersey Statutes that either have been approved by the Governor or await the Governor’s approval.

New Jersey Approves Hospital Wrap-Around Services

S1676: As noted in our previous update, Governor Murphy previously issued a conditional veto of this bill, which allows hospitals to provide wrap-around services for individuals who are homeless or housing insecure. After factoring in the Governor’s comments, the bill has now been approved.

Creation of Long-Term Care Ombudsman

A4484: This bill, requiring the State Long-Term Care Ombudsman (“Ombudsman”) to establish a long-term care advocacy and educational training program, passed both the State Assembly and Senate. Under the bill, the Ombudsman is required to establish an annual long-term care training program to address the following subjects: the rights of residents of long-term care facilities; fostering choice and independence among residents of long-term care facilities; identifying and reporting abuse, neglect, or exploitation of residents of long-term care facilities; long-term care facility ownership; updates on State and federal guidelines, laws, and regulations that pertain to long-term care facilities; and issues, trends, and policies that impact the rights of long-term care residents. The training program is to be offered to residents of long-term care facilities, those residents’ family members, advocacy organizations, government agencies, and long-term care facility employees.  The bill will become law if executed by the Governor.

Statutes on Opioid Addiction and Antidote

A5703:  This bill, which has already been approved by the Governor, requires a health insurance company who is authorized to issue health benefits plans in this state, as well as the Medicaid program, the NJ FamilyCare Program, the State Health Benefits Program, and the School Employees’ Health Benefits Program, to provide coverage for an opioid antidote without imposing prior authorization requirements or other utilization management requirements, provided that the treatment is: (1) prescribed or administered to the eligible member by a licensed medical practitioner who is authorized to prescribe or administer that treatment pursuant to State and federal law or (2) dispensed to the eligible member by a licensed pharmacist under a standing order to dispense an opioid antidote pursuant to section 1 of P.L.2017, c.88 (C.45:14-67.2), which allows pharmacists to dispense opioid antidotes to any person without an individual prescription. The bill defines “opioid antidote" to mean naloxone hydrochloride, or any other similarly acting drug approved by the FDA for self-administration for the treatment of an opioid overdose.

A5595: This bill, which has been approved and is now law, makes the retail price of opioid antidotes readily available to consumers by including this information in the New Jersey Prescription Drug Retail Price Registry (“NJPDRPR”).    The NJPDRPR makes up-to-date retail price information for the 150 most frequently prescribed prescription drugs in the state readily available to consumers. It indicates the actual price to be paid to the pharmacy by a retail purchaser. This bill includes opioid antidotes on the list of frequently prescribed prescription drugs. Under the bill, “opioid antidote” is defined as any drug, regardless of dosage amount or method of administration, which has been approved by the FDA for the treatment of an opioid overdose, and includes naloxone hydrochloride, commonly known as Narcan.

S3491:  This bill, which has already been approved by the Governor, permits any person to acquire, furnish or administer to another person opioid antidotes, and expands access to opioid antidotes including, among other circumstances, without an individual prescription.

S3803: This bill permits certain paramedics to administer buprenorphine, which is a form of medication-assisted treatment that helps curb cravings resulting from opioid use disorder. Under the bill, a paramedic who has responded to an emergency as a member of a dispatched mobile intensive care unit may administer buprenorphine, under the medical direction of a licensed, supervising physician, to an individual following the emergent administration of an opioid antidote to the individual, provided that the paramedic administering the buprenorphine: (1) is providing emergency medical services through a program that is registered with the United States Attorney General pursuant to subsection (j) of 21 U.S.C. s.823; (2) administers the buprenorphine consistent with all applicable requirements of federal law; and (3) has completed supervised comprehensive training and competency assessments within a mobile intensive care unit regarding which specific medical conditions necessitate the administration of buprenorphine, buprenorphine dosage requirements, and required medical documentation following the administration of buprenorphine. This bill has already been approved by the Governor.

Telemedicine and Medical Cannabis

S619: This bill, which has been approved and is now law, permits patients to be authorized for medical cannabis and to have written instructions for medical cannabis issued to the patient using telemedicine and telehealth. Specifically, for a period of 270 days following the effective date of the bill, a healthcare provider may authorize a patient who is a resident of a long-term care facility, has a developmental disability, is terminally ill, is receiving hospice care from a licensed hospice care provider, or is housebound as certified by the patient’s physician, for the medical use of cannabis using telemedicine and telehealth. Thereafter, a healthcare provider may initially authorize any patient for the medical use of cannabis using telemedicine and telehealth, provided that, except in the case of a patient who is a resident of a long-term care facility, has a developmental disability, is terminally ill, is receiving hospice care from a licensed hospice care provider, or is housebound as certified by the patient’s physician, the patient has had at least one previous in-office consultation with the healthcare provider prior to the patient’s authorization for the medical use of cannabis. Following the initial authorization, the patient is to have at least one in-office consultation with the healthcare provider on an annual basis in order for the patient to receive continued authorization for the use of medical cannabis.

New Statute on Pharmacy Benefit Managers

S249: This bill, which unanimously passed both the State Assembly and Senate and awaits the Governor’s signature, requires any contract entered into by a Medicaid managed care organization, or by the Division of Medical Assistance and Health Services in the Department of Human Services (“DHS”), for the provision of pharmacy benefits management services under the Medicaid Program to require the pharmacy benefits manager to disclose: (1) all sources and amounts of income, payments, and financial benefits received by the pharmacy benefits manager in relation to the provision and administration of pharmacy benefits management services on behalf of the managed care organization, including, but not limited to, any pricing discounts, rebates of any kind, inflationary payments, credits, clawbacks, fees, grants, chargebacks, reimbursements, or other benefits; (2) all ingredient costs and dispensing fees or similar payments made by the pharmacy benefits manager to any pharmacy in connection with the contract or other arrangement; and (3) the pharmacy benefits manager’s payment model for administrative fees. Information reported by pharmacy benefits managers under the bill will be confidential and will not be subject to disclosure under the Open Public Records Act.

Expanding Providers Who Can Administer Vaccines

A5212: This statute provides that a dentist may administer the influenza vaccine or the human papillomavirus vaccine to a patient who is 18 years of age or older. It also provides that a dentist may administer immunizations to patients who are 18 years of age or older during a public health emergency which are intended to prevent or reduce the transmission of the disease that is the basis for the declared public health emergency. The bill passed both the Senate and Assembly and will become law once the Governor executes the bill.

Expansion of the SBYSP for Mental Health Services

A4435: This bill amends the statute governing the School Based Youth Services Program (“SBYSP”), which is located in host schools, and is currently operated by The Department of Children and Families’ Office of School-Linked Services within the Division of Family and Community Partnerships. SBYSP services include, among others, mental health counseling, employment counseling, and substance abuse education/prevention. After applying certain factors, under the bill, priority for SBYSP grants will first be given to new applicant school districts and school districts seeking to expand current programs that include in their application a center or other entity that focuses on providing individual, family, and group clinical mental health counseling services to students.  The schools will offer access to mental health counseling services during, before, or after school hours to students either in-person or remotely through the use of telehealth or telemedicine services, as applicable. The bill passed both the Senate and Assembly and awaits the Governor’s signature.

New Software for SNAP Benefits

A5880: This bill requires the DHS to develop and maintain a mobile-friendly software for recipients of the Supplemental Nutrition Assistance Program (“SNAP”). The mobile software program will include, but not be limited to, functionality that allows a user of the mobile software program who is a recipient of SNAP benefits to view the user’s SNAP case status and the current benefits the user receives, upload and submit required documents for continued participation in SNAP and track the current processing status of those documents, and receive notices and updates regarding important deadlines or actions. The mobile-friendly software will also be required to be made available free of charge and in multiple languages. The bill passed both the Senate and Assembly and will become law if the Governor executes the bill.

Creation of Risk Reduction Model for Prescription Drug Services

S887: This bill has already been approved and is now law. It requires the Division of Medical Assistance and Health Services in the DHS to contract with a third party entity to apply a risk reduction model to prescription drug services provided under the Medicaid program for the purpose of identifying and reducing simultaneous, multi-drug medication-related risk and adverse drug events, enhancing compliance and quality of care, and improving health-related outcomes while reducing total cost of care in a measurable and reportable manner. To carry out this purpose, the model will leverage Medicaid prescription drug claims data, pharmacokinetic and pharmacodynamic sciences, appropriate technologies, clinical call centers located in New Jersey and staffed by board-certified pharmacists, and include coordination of services with a network of local community pharmacies located throughout the state. For the duration of the contract, the division will share the medical and pharmacy claims data for all Medicaid beneficiaries with the third party entity administering the model for the purposes of effectuating the model, which claims data will include historical data.

New Jersey Easy Enrollment Health Insurance Program for the Un-insured

S3238: This bill, which passed both houses and awaits the Governor’s signature, establishes a program to help improve access to healthcare. The bill requires the Department of Banking and Insurance (“DOBI”) to establish and operate the New Jersey Easy Enrollment Health Insurance Program (the “program”). The program would identify which uninsured residents would be interested in obtaining minimum essential coverage and if they are eligible for insurance affordability assistance. DOBI is required to integrate the program with the State-based health insurance exchange. Residents who qualify for affordability assistance and are interested in obtaining insurance would be contacted through the program to receive assistance enrolling in a plan.

Further Changes to the Garden State Health Plan

A5825: This bill, which has already been approved, changes the effective date of the new Garden State Health Plan for the School Employees’ Health Benefits Program and for local education employers, as established by P.L.2020, c.44, from July 1, 2021 to January 1, 2022. This bill also clarifies that charter school and renaissance school employers do not have to implement the provisions of P.L.2020, c.44 unless they have a collective negotiation agreement with any of their employees in effect on or after the effective date of P.L.2020, c.44, July 1, 2020. Among other changes, this bill provides that for any period of time during which the school district as an employer does not have to pay a premium or periodic charge for any healthcare benefits plan or program provided to its employees through the School Employees’ Health Benefits Program, then an employee enrolled in such plan or program will not be required to make the employee’s contribution toward that premium or periodic charge during that period of time. The bill also requires a board of education and the majority representative of its employees to engage in collective negotiations to substantially mitigate the financial impact of the difference when the net cost, which is the cost after deducting employee contributions, to the employer for healthcare benefits is lower than the cost to the employer would be compared to the New Jersey Educators Health Plan. The bill also requires any school district with an increase in net cost as a result of the changes in P.L.2020, c.44 to commence negotiations immediately, unless mutually agreed upon by the employer and the majority representative of employees to opt to substantially mitigate the financial impact to the employer as part of the next collective negotiations agreement.

Premium Wipe Out for NJ Family Care

S3798: The bill generally prohibits requiring enrollees in NJ FamilyCare to pay premiums as a condition of participation in the program, but premiums may still be required for enrollees who exceed income limits but elect to buy into NJ FamilyCare. The bill eliminates a provision in the current law that requires certain children who were voluntarily dis-enrolled from employer-sponsored group insurance coverage to be deemed ineligible for enrollment in NJ FamilyCare for a certain period, and provides that no waiting periods may be imposed against any applicant for the program who is otherwise eligible for enrollment. The bill also requires DOBI, in consultation with the Commissioner of Human Services, to take steps to ensure the full incorporation of the Medicaid, NJ FamilyCare and NJ FamilyCare Advantage Programs on the State’s health insurance Exchange and the individual health coverage marketplace. This bill has already been approved by the Governor.

8th Circuit: No Automatic FDCPA Protection for Boilerplate Disclosures

Posted on by rd_admin

The United States Court of Appeals for the Eighth Circuit recently affirmed summary judgment in favor of a mortgage loan servicer, finding that the communications from the mortgage loan servicer were not communications “in connection with the collection of a debt,” as required under the Fair Debt Collection Practices Act (“FDCPA”). See Heinz v. Carrington Mortg. Servs., LLC, 2021 WL 2878322 (8th Cir. July 9, 2021). In the case, a borrower obtained a loan secured by a mortgage on his home. Upon default, the assignee to the loan initiated foreclosure proceedings and advised that the foreclosure sale was scheduled to occur on August 1, 2017. In July 2017, Carrington Mortgage Services, LLC (“Carrington”) became the servicer of the loan and confirmed that the foreclosure sale would proceed as scheduled. However, a Carrington representative allegedly informed the borrower that to prevent the foreclosure sale, the borrower could submit a loss mitigation package. Thereafter, the borrower contacted the Minnesota Attorney General’s Office for assistance with the application.  The foreclosure sale was subsequently postponed to September 9, 2017, and later to November 14, 2017. Between August and November 2017, the borrower provided Carrington with financial information, which Carrington advised was incomplete. However, a Carrington representative allegedly advised that the borrower’s file had been sent to underwriting and was awaiting a final determination. Nevertheless, Carrington proceeded with the scheduled foreclosure sale. Carrington subsequently mailed the borrower a cancellation notice, dated two days after the foreclosure sale, which advised the borrower for the first time that his loss mitigation assistance application had been cancelled. The borrower then requested that Carrington rescind the foreclosure sale, which was subject to a six-month redemption period in which the borrower was able to redeem the property. Nevertheless, one day after the redemption period expired, Carrington informed the borrower that it declined to rescind the foreclosure sale because the borrower failed to provide the requisite documentation to complete the loss mitigation assistance application.

The borrower then brought a claim under the FDCPA in Minnesota State Court, seeking rescission of the foreclosure sale, a temporary restraining order preventing eviction, and damages. Carrington subsequently removed the action to federal court based on federal question jurisdiction. Applying the “animating purpose” test, the District Court granted summary judgment in favor of Carrington, concluding that Carrington's communications and conduct in the course of its dealings with the borrower were not in connection with an attempt to collect a debt, and therefore not subject to the FDCPA. As to the communications that occurred after the foreclosure sale, the District Court also determined that they were immaterial because they had no impact on the borrower’s legal rights.

On appeal, the Eighth Circuit affirmed. The Court noted that in considering whether certain statements or conduct are in connection with the collection of a debt for the purposes of the FDCPA, the Eighth Circuit employs the “animating purpose” test.  Under this test, “‘for a communication to be in connection with the collection of a debt, an animating purpose of the communication must be to induce payment by the debtor.’” Relying on Obduskey v. McCarthy & Holthus LLP, 139 S. Ct. 1029, 1036 (2019), the borrower argued that the Supreme Court's statement that nonjudicial foreclosure is a debt collection activity rendered each of the communications made by Carrington in connection with the attempt to collect a debt. The Court, however, found that the substance of communications demonstrated otherwise. Specifically, the communications did not contain any information about the loan, such as the principal amount remaining due, the past due amount, or a request for payment. Most importantly, the Court held that although each letter included a “Mini-Miranda” statement in the disclosures section, which stated that “[t]his communication is from a debt collector and it is for the purpose of collecting a debt and any information obtained will be used for that purpose,” the inclusion of such boilerplate language “[does] not automatically trigger the protections of the FDCPA, just as the absence of such [disclosures] does not have dispositive significance.” Further, the Court found that Carrington’s conduct in delaying communications with the borrower was not done in an attempt to collect upon a debt under the FDCPA. Thus, the Court affirmed summary judgment in favor of Carrington.

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

Bankruptcy Court May Exercise “Related to” Jurisdiction Over Quiet Title Action

Posted on by rd_admin

The Eleventh Circuit recently affirmed a Bankruptcy Court and held that dismissal of an underlying bankruptcy case did not divest the Bankruptcy Court of jurisdiction in related quiet title action. In re Lindsey, 2021 WL 1140661 (11th Cir. 2021). In 2015, the plaintiff filed a voluntary petition for Chapter 13 bankruptcy relief. In his schedule of assets, the plaintiff listed a fee simple interest in a commercial multi-tenant building and an adjacent vacant lot. To avoid losing the properties in a foreclosure proceeding commenced by a mortgage-holder, the plaintiff decided to sell the properties to Duckworth Development (“Duckworth”). The Commercial Contract, title commitment and cover letter identified the plaintiff and Kracor South, Inc. (“Kracor”), a corporation in which the plaintiff was president and majority shareholder, as the seller. Pursuant to the title commitment and cover letter, the plaintiff and Kracor were required to execute a warranty deed as a condition to the issuance of a title insurance policy. At the closing, however, the plaintiff executed the warranty deed as president of Kracor, but not in his individual capacity, as well as a title affidavit swearing that Kracor owned the parcels and that there were “no parties in possession of the [p]roperty other than Kracor.” Six months later, upon learning that a title insurance agency prepared a report stating that the owners of the parcels were Duckworth and the plaintiff, the plaintiff claimed that he was “50% owner” and demanded half of the rental income generated by the parcels. After the plaintiff refused to execute a corrective warranty deed, Duckworth commenced an adversary proceeding against the plaintiff and Kracor in Bankruptcy Court seeking reformation of the warranty deed and to quiet title. Although the bankruptcy case was voluntarily dismissed, the Bankruptcy Court retained jurisdiction over the adversary proceeding, finding “that the parties had intended for Duckworth Development to purchase the parcels in fee simple, and the warranty deed didn’t reflect this agreement.” The Bankruptcy Court also found that omission of the plaintiff in his individual capacity from the warranty deed was a mistake, and thus, reformation of the warranty deed was an appropriate remedy. As to the quiet title claim, the Bankruptcy Court concluded that Duckworth established it held valid title to the parcels and the plaintiff’s claimed half interest was invalid.

On appeal, the Eleventh Circuit affirmed. First, it held that the Bankruptcy Court had subject matter jurisdiction over the adversary proceeding under 28 U.S.C. § 1334(b) because Duckworth’s adversary complaint was “related to” the plaintiff’s bankruptcy case. The Court also found that dismissal of the underlying bankruptcy case did not automatically divest the Bankruptcy Court of jurisdiction. Next, the Court held that the Bankruptcy Court had a sufficient evidentiary basis to reform the warranty deed to “accurately express the true intention or agreement of the parties.” The Court found that the parties intended for Duckworth to buy the plaintiff’s entire interest in the parcels. Specifically, among other things, the cover letter and title commitment indicated that both Kracor and the plaintiff were collectively the seller and required both to execute the warranty deed. Moreover, when the plaintiff moved the Bankruptcy Court for leave to sell the properties, he represented that his intent was to sell “his” property pursuant to the terms “between [him]” and Duckworth. The Court also found that the parties made a mutual mistake because the warranty deed omitted the plaintiff in his individual capacity, contrary to the parties’ intent for the plaintiff to sell his entire interest in the properties to Duckworth. Accordingly, the Eleventh Circuit affirmed the Bankruptcy Court's judgment in favor of Duckworth.

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 Poised to Pass New Telemedicine and Nursing Home Statutes

Posted on by rd_admin

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

In recent years, numerous laws have been proposed and enacted in New Jersey that impact healthcare.  This year is no exception, with some benefiting providers or patients and others that increase regulatory burdens on providers.  In the past few months, the New Jersey State Senate and Assembly have passed approximately twenty statutes that relate to healthcare in New Jersey.  The below discusses two of those statutes. The first is the much anticipated telemedicine statute that maintains the equal pay rates for telemedicine and in-person visits.  The second involves a statute that imposes additional obligations on nursing homes and other facilities that care for seniors.

Both of these bills passed the State Senate and Assembly and will become law if the Governor executes them.

New Jersey Set to Make Permanent the Equal Rates for Telemedicine and In-Person Visits 

S2559:   During the COVID-19 pandemic, New Jersey required health insurance carriers to pay telemedicine visits at the same rate as in-person visits, but those orders will expire soon.  (See June 17, 2021 Update). This bill modifies the various statutes that apply to telemedicine, the State Medicaid and NJ FamilyCare programs, the State Health Benefits Program (SHBP), and the School Employees’ Health Benefits Program (SEHBP), to require health insurance carriers to pay for telemedicine services regarding all physical and behavioral healthcare services at the same rate as in-person visits, including remote patient monitoring. The provider must use both an audio and video component to qualify for the rate.

Significantly, the bill amends the definition of “telemedicine” to include audio-only telephone conversation, but the provider will be reimbursed at a lesser rate, but no less than 50% of the reimbursement rate for an in-person visit.  However, a behavioral health service that uses audio only, whether or not utilized in combination with asynchronous store-and-forward technology, still qualifies for full reimbursement.  Co-pays, deductibles and co-insurance apply.

In addition, at the time a patient requests healthcare services to be provided using telemedicine, the provider must advise the patient whether the encounter will be with a healthcare provider who is not a physician, and the patient may specifically request that the encounter be scheduled with a physician. If the patient requests that the encounter be with a physician, the encounter shall be scheduled with a physician.

Importantly, the benefit of this statute does not apply to a healthcare service provided by a telemedicine organization that does not provide healthcare services on an in-person basis in New Jersey.  In other words, the telemedicine organization has to offer the same services in-person as it does through telemedicine.

This bill continues the benefits provided during the pandemic as it relates to COVID-19. Specifically, health insurance carriers must provide coverage, without the imposition of any cost sharing requirements, including deductibles, copayments, or coinsurance, prior authorization requirements, or other medical management requirements, for the following services furnished during any portion of the federal state of emergency:  (1) testing for COVID-19, provided that a healthcare provider has issued a medical order for the testing; and (2) items and services furnished or provided to an individual during healthcare provider office visits, including in-person visits and telemedicine and telehealth encounters, urgency care center visits, and emergency department visits, that result in an order for  administration of a test for COVID-19.

New Requirements for Nursing Homes and Other Facilities Caring for Seniors

S2798:  This bill modifies the definition of “long-term care facility” to just a nursing home and removes assisted living facility, comprehensive personal care home, residential healthcare facility, or dementia care home from the definition.  Although long-term care facilities were always required to have an outbreak response plan, this bill makes it a condition of licensure.

In addition, this bill requires each long-term care facility to establish an infection prevention and control committee and assign to that committee a physician who has completed an infectious disease fellowship, and such physician must be employed on a full-time or part-time basis depending on the size of the facility.  The committee must also designate an infection preventionist who has primary professional training in medicine, nursing, medical technology, microbiology, epidemiology, or a related field and has at least five years of infection control experience or certification in infection control by the Certification Board of Infection Control and Epidemiology.  A long-term care facility that is unable to hire an infection preventionist on a full-time or part-time basis may contract with an infection preventionist on a consultative basis until February 1, 2022.  After February 1, 2022, a long-term care facility must hire an infection preventionist on a full-time or part-time basis, except that the Department of Health may waive this requirement if a long-term care facility is unable to hire an infection preventionist following the facility’s good faith efforts to hire an infection preventionist.

The bill goes on to define assisted living facility, comprehensive personal care home, residential healthcare facility, and dementia care home, and requires these facilities to also develop an outbreak response plan as a condition of licensure and to establish an infection prevention and control committee, with the exception that the committee only has to include an infection preventionist that meets certain requirements.

Get Our Latest Insights

Subscribe