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Plaintiff's Attorney AVENATTI Convicted of Extortion

While an employer may state publicly or privately that the plaintiff's demands were "extortion," it is extremely rare for a plaintiff's attorney to be convicted of such an offense.  Well, this just happened to a plaintiff's attorney, a high-profile one at that, Michael Avenatti, who rose to national prominence as the attorney for adult-film actress Stormy Daniels, who had apparently settled a claim involving President Trump.  On February 14, 2020, a jury found that Avenatti tried to extort $20 million from Nike by threatening to expose damaging information about the company.  In the negotiation session with Nike's attorneys, the defense attorneys secretly tape recorded the negotiations in which Avenatti allegedly threatened to expose corruption by Nike in connection with high school basketball players if Nike did not pay Avenatti's client a significant amount of money and hire him to conduct an internal investigation at Nike.  Avenatti's defense was that he was just using tough negotiating tactics and wasn't trying to extort the company.  U.S. attorneys saw the situation differently, calling Avenatti's approach "an old-fashioned shakedown."  Avenatti apparently had threatened to expose the alleged payments to high school basketball players at a news conference.

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Traps to Avoid in Obtaining Paycheck Protection Program (PPP) Loan Forgiveness

The PPP allows certain employers (primarily those with less than 500 employees) to obtain low cost (1% interest), short-term (2 years) financing from the federal government for certain operating expenses consisting of payroll costs, interest on certain loans (not principal), rent on real and personal property, and certain utilities.

The limitation on the use of the loan proceeds means that employers cannot use the money to pay suppliers, contractors, or insurers.

In addition, recent regulations impose a requirement that is not in the statute--75% of the loan proceeds must be spent on certain payroll costs to qualify for forgiveness. This requirement ignores the fact that many businesses in normal times do not spend 75% of their revenue on payroll costs and those businesses may not survive if other obligations are not paid.

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DOL Issues Temporary Regulations to Implement Emergency and Paid Sick Leave Provisions

On April 1, 2020, the U.S. Department of Labor (DOL) issued a temporary rule to implement the Public Health and Emergency and Paid Leave Provisions.  There are several areas in the regulations that had not previously been addressed in detail, including the type notice an employee must provide the employer, the documentation the employer may require the employee to provide as to the need for such leave, recordkeeping, and the determination of whether the employer meets the small employer exemption.  The most important particulars of the regulations are summarized below:

1. Employees subject to the new family and medical leave and paid leave provisions may not take paid leave where the employer does not have work for the employee available.

2. Employees subject to a quarantine or isolation order that are able to telework, and therefore may not take paid sick leave if:  (a) the employer has work for the employee to perform; (b) the employer permits the employee to perform the work from another location; and (c) there are no extenuating circumstances that prevent the employee from performing that work.

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