Category: Business

Force Majeure Clauses Gain Prominence During COVID-19

Posted on under Articles, Business, Contracts.

The COVID-19 epidemic brought to the forefront a contractual concept known as “force majeure.”  The term “force majeure” is a French phrase that means “superior or irresistible force.”  In contract law, a force majeure clause excuses or delays a party from performing its contractual obligations under the contract due to unforeseen events or circumstances.  This often-overlooked term became the focus of countless businesses and nonprofits unable to comply with their contracts due to the outbreak of COVID-19.  As our nation deals with COVID-19 and other future outbreaks of disease, force majeure clauses need to be carefully analyzed to determine if they allow a party to escape its obligations.  New contracts should be carefully drafted to ensure that COVID-19 or other similar outbreaks continue to constitute a valid reason to terminate or delay a contractual obligation.

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Avoid the Pitfalls of Careless Contract Drafting

Posted on under Articles, Business, Contracts.

Each day millions of businesses, individuals, and non-profits make law that spells out their rights, duties, and obligations.  They do this by entering contracts.  A contract is an agreement between two or more parties containing legal obligations that carry the force of law.  It can be surprising how little attention is paid to contracts before signing them.  In some cases, parties enter multi-year agreements or incur thousands or millions of dollars in obligations without carefully reviewing the agreement. 

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California and Europe Lead the Way on Data Privacy – More States to Follow

Posted on under Articles, Business, Computer & Internet.

You may have heard that the California Consumer Privacy Act (CCPA) went into effect on January 1, 2020.  The CCPA is the first major attempt by a state government in the United States to regulate the use of consumer personal information.  Following California’s lead, other states have started considering similar data privacy laws.  The CCPA has been compared to the European Union General Data Protection Regulation (GDPR) that became effective in 2018.  While the CCPA has some similarities to the GDPR, significant differences between the two laws mean that compliance with one of the laws will not necessarily equate compliance with the other.  It is important for businesses subject to either or both of those laws to be aware of what is needed to be in compliance.  Businesses not subject to California and European data privacy laws should nevertheless pay attention to data privacy concerns because it is likely similar laws will be passed throughout the country over the coming years.  Legislation is pending in several state legislatures, including Illinois, with similarities to the CCPA and GDPR. 

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Act Promptly to Respond to a Data Breach

Posted on under Articles, Business, Computer & Internet, Intellectual Property.

If you own or operate a business or non-profit organization, then it is likely not a matter of if, but when, you will experience a data breach.  News stories proliferate of high-profile data breaches involving sensitive data of millions of people.  A recent data breach of a major online fundraising platform has had far-ranging implications, affecting countless individuals, businesses, and organizations throughout the world.  The costs to investigate the breach, notify all affected parties, and work with those parties to address the breach must have been staggering.  The same data breach laws that apply to large, multi-national IT providers also apply to small businesses and non-profit organizations.  If you experience a data breach, it is imperative that you act quickly to address the breach and comply with any applicable data breach notification laws.        

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Illinois Considering Data Privacy Law

Posted on under Articles, Business.

Beginning with the EU General Data Protection Regulation (GDPR) in 2018 and continuing with the California Consumer Privacy Act (CCPA) in 2020, governments have become increasingly active in regulating how businesses use personal information of consumers. Legislation is currently pending before the Illinois General Assembly that would adopt a similar data protection framework for Illinois residents. Businesses that collect, store, or use personal information of Illinois residents should be aware that they may soon have new obligations to provide disclosures, respond to consumer requests about their data, and comply with other requirements. 

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Accepting Donations of Crypto Currency

Posted on under Articles, Business, Nonprofits.

More frequently, nonprofit development officers and fundraisers are asked by prospective donors about whether their organization will accept donations of “Crypto Currency”, or other types of virtual currency.[i] The most commonly known form of Crypto Currency is Bitcoin, however, there are many other types of Crypto Currency that can be bought, traded, and sold.

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COVID-19: Family and Medical Leave Legislation

Posted on under Articles, Business, Employment, Taxes.

On Wednesday, March 18th, the President signed into law the Families First Coronavirus Response Act (FFCR). The FFCR applies to all employers with 500 or fewer employees and contains three primary sections related to employers: Emergency Family and Medical Leave Act Expansion; Emergency Paid Sick Leave Act; and Tax Credits for Paid Sick and Paid Family and Medical Leave. The FFCR is slated to take effect April 2, 2020 and will expire on December 31, 2020.

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Illinois Employment Law for 2020

Posted on under Articles, Business, Employment.

2019 was a busy year for the Illinois legislature with respect to state employment law changes. Below is a summary of the most important pieces of legislation affecting employers in 2020:

Amendments to the Equal Pay Act of 2003

Made effective on September 29, 2019, the intent of the legislation is to address pay disparity between men and women. As amended, the Equal Pay Act prevents employers from:

  • Requesting or requiring that an applicant disclose wage or salary history as a condition of employment;
  • Requesting or requiring a wage or salary history as a condition of being considered for employment, as a condition of being interviewed, as a condition of an offer of employment, or as a condition of an offer of employment or an offer of compensation;
  • Screening job applicants based on their current or prior wages or salary histories, including benefits or other compensation, by requiring that the wage or salary history of an applicant satisfy minimum or maximum criteria; or   
  • Seeking the wage or salary history, including benefits or other compensation, of a job applicant from any current or former employer.
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IRS Grants The Salt Lake Tribune Tax-Exempt Status

Posted on under Articles, Business, Nonprofits.

In an interesting new development, the IRS granted 501(c)(3) tax-exempt status to a major daily newspaper.  On November 3, 2019, the Salt Lake Tribune announced that it had incorporated as a non-profit corporation, re-structured its operations, and obtained IRS recognition of its 501(c)(3) status.  Tax-exempt practitioners have speculated for years that a daily newspaper could, in theory, qualify for tax-exempt status under Section 501(c)(3).  However, the Salt Lake Tribune’s announcement was the first time that a major daily newspaper is known to have succeeded in obtaining recognition of 501(c)(3) tax-exempt status. Granting tax-exempt status to this daily newspaper means that the IRS has now officially recognized news-reporting as an exempt purpose. 

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Where to Incorporate?

Posted on under Articles, Business, Churches and Religious Organizations, Nonprofits.

An early decision founders of new non-profit organizations must make is where to incorporate. A U.S. charitable, religious, or educational organization has its choice of incorporating in any of the 50 states as well as the District of Columbia. With this many choices, founders may ask if it is advantageous to incorporate in one state over another. When it comes to for-profit companies, it is common for them to incorporate or organize in Delaware due to tax or regulatory issues. We recently ran across an article advising non-profits to incorporate in Delaware. We thought it would be helpful to address if non-profits derive any advantage from incorporating in Delaware or another state in particular.

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