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Monday, April 25, 2016

Brady and "Cause"

So, thanks to the Second Circuit's opinion earlier in the day, Brady will sit after all (assuming no rehearing en banc and no grant of certiorari by the Supreme Court).  The situation is interesting as an object lesson in the employment context, as it shows how grey the situation can be when there is an accusation of wrongdoing against an employee, particularly one covered by an employment (or similar) contract.  Does the conduct rise to the level of "cause"?  What level of proof is necessary for action against the employee?  How much is an arbitrator's decision final and binding?  I would suggest viewing the Brady suspension/reversal/re-suspension* through the employment prism, as I think that in some sense it shows that, at the very least, certainty is often not the right by-word for disputes of this nature.

And, as a bit of a personal post-script, I just went to find where I posted my prediction right after the district court reversed Brady's Deflategate suspension, which prediction I had boldly stated to any number of people, that the Second Circuit would ultimately reverse the district court here.  It just always seemed obvious to me that, putting aside for a moment whether the NFL made the right substantive call in suspending him, the NFL did act within its contractual power in doing so.  However, to my great dismay, I never did the post.  So you'll just have to trust me that, in this case, I got one right (I'm entitled to get one right every 16 or so years).

_________________
* Sounds like a description of the path for the DOL's fiduciary regulation.

Saturday, April 23, 2016

SOX in Saul (with sincere apologies to Dr. Suess)

SOX's impact on executives has been referenced in USA's Suits, as discussed in a prior post relating to executive-compensation references in a certain Suits episode. And, as discussed in a prior post regarding Better Call Saul and then a subsequent Saul post, BCS, after having hit various employment and executive-compensation issues in consecutive episodes, now also adds a SOX reference of its own. In trying to woo a key client, Charles (Chuck) McGill (played by the appropriately revered Michael McKeon) pontificates as follows:

"Any bank such as Mesa Verde looking to open a de novo branch is definitely going to need to show a healthy portfolio of [Community Reinvestment Act] compliance. Duh. Obviously. You guys have all that covered, I'm sure. . . . And then there's the SEC's interpretation of Section 302 of SarbOx. Blah blah blah."

OK, I know that that's three Saul references by me in a very short period of time - but after having watched the finale of Season 2 I just cannot believe how great this show is. So I was emboldened. So there.

Thursday, April 7, 2016

From Presidential Speeches to an Impact on the Stock Market - ERISA's "Fiduciary" Rule in the Limelight

Back in the day (it seems like so long ago), I posted on the fact that an ERISA defined term ("investment advice") had become the centerpiece of a major presidential policy speech.  Who'da thunk THAT?!?  Well, it became increasingly clear the "investment advice" regulations under the ERISA "fiduciary" rules were becoming quite a "thing", potentially having real impact on financial institutions and their customers.  The ability of institutions to continue making available a range of products and offering traditional compensation structures, and of investors and other customers to have access to those products and structures, was in some amount of serious jeopardy.

In the end, we wound up with a final regulation the release of which seems to have boosted certain financial-sector stocks, while possibly having a dampening effect within the insurance-company sub-sector.  Not only has the President pontificated on a defined term in ERISA, but now the stock market has moved in response to the final interpretation thereof.  Wow - the Little ERISA Engine That Could.

So - how did we get to where we are?  Basically, over the years, the DOL came to be extremely frustrated with the narrowness of its '75 "investment advice" reg., on the basis that it may have been too easy to escape fiduciary status merely by causing any one part of the reg.'s ubiquitous five-part test not to be satisfied.

Why was the test as narrow as it was?  I think there were legitimate concerns that an overinclusion of providers as "fiduciaries" could cause potentially desirable providers not to want to serve or could, at the least, affect pricing.  And there's always the question of the fairness of the definition and its scope.  So the '75 reg. struck a balance.  Was it the right balance?  Is it still the right balance?  These are debatable points.

Regardless, the DOL grew increasingly frustrated over the years with its regulation, both from a compliance perspective in terms of being able to reach providers giving what on some level may have seemed like advice, and in terms of a litigation strategy to try to address perceived fiduciary violations.  In addition, the retirement market had moved dramatically, with a seismic shift from traditional defined benefit pensions to those newfangled individual account 401(k) plans, and with a real change in the nature of investments and investment platforms.  For better or for worse, the DOL came to the conclusion that the '75 balance was not optimal.

The DOL's distrust of financial professionals became palpable.  And, on the flip side, the DOL had the sense that, particularly on the retail side, investors and other customers were not seeing or reading disclaimers and other disclosure and, when they were, were not understanding them. This latter dynamic has been somewhat less focused upon by commentators, but it is a key part of the calculus that led the DOL to the approach it would eventually pursue.

So back in 2010 the DOL uncorked a proposal to expand exponentially the scope of who might be considered a nondiscretionary fiduciary by virtue of providing investment advice.  Leaning heavily on that power plant of electricity known as Reorganization Plan No. 4 of 1978 (see also (with my thanks to Mark G.) P.L. 98-532), the DOL not only reached toward expansively interpreting "investment advice" for ERISA purposes, but also made a play to grab the issue as applied to IRAs.  Pretty gutsy, since Congress itself eschewed IRAs when it came to ERISA coverage - but, nevertheless, there it was.  The DOL saw IRAs as being at or close to the center of the retirement market, and was not about to let some silly little thing like a lack of ERISA applicability stop it from seeking substantively to step in and regulate.  Some have asked whether the DOL had the authority effectively to port ERISA over to IRAs where Congress had pretty clearly decided not to do so.  Maybe even a better question seemed to be: should the DOL be wielding this purported authority in this way?

The ensuing maelstrom was thunderous, eventually resulting in the 2011 announcement that the proposed regulation would be withdrawn.  The financial-services community had credibly made the case that the reg. as proposed would have a palpable adverse effect on that community, assertedly to the detriment not only of financial-services organization but also of the very plan clients and customers that were supposedly the object of the purported protections.  But, supposedly, the regulation would someday be reproposed.

And there it sat for years in a state of atrophy, at least from the outside looking in.  Until, that is, there started to be rumblings towards the end of 2014 that the reg. was not dead.  And then, in early 2015, the other shoe - a really big shoe (apologies to Ed Sullivan), dropped.  The President himself, as noted above, stepped in and in February of 2015 made the as-yet un-reproposed regulatory initiative into the centerpiece of a major policy speech, and it was game on.  Sure enough, in April 2015, we indeed get the reproposed reg.

It was clear that reg.-redux was more carefully thought through than the initial proposal.  And this time the reg. was accompanied by a new exemption, klunkily to become known as the "best interest contract" exemption (or the "BIC" exemption, or just "BICE").  However, on further reflection, the financial-services community at some point gravitated back to a highly adverse approach, and literally thousands of comment letters were submitted.  The DOL was in a bit of a bunker, but, particularly in light now of an express presidential imprimatur, there seemed to be no real path to administrative reversal.  Legislative solutions? - maybe, but not overly likely.  Litigation solutions? - who knows?  (More on that later.)

So barreling down the road to finalization we went.  To the great consternation of some, administrative consideration periods were truncated, and effective-date strategies were conceived, all with an eye towards getting the reg. done before the election and, maybe moreover, before the impending changeover in administrations.  As we saw when Obama took over from Bush (see, e.g., the eventually re-jiggered 408(b)(14) and (g) regulation), pending regulatory initiatives not fully implemented at the time of a turnover in administrations are at risk for being waylaid.  And this particular li'l ERISA reg. had become the object of some real zealotry within the DOL and maybe, to some extent, even within the broader administration.

We move now to yesterday, April 6, and, after all that, we get the final rule.  Many had resigned themselves to the notion that, given the background, the DOL would maybe pay lip-service to some contouring here and there, but would never make any material changes in favor of financial-services organizations.  I didn't share that view.  I agreed that the basic tack of the regulatory effort would indeed not change - that the ocean liner would not turn with enough force to avoid an iceberg - but that there would be substantial and significant major changes to any number of specifics - "the devil is in the details", as they say.  I really had the sense that the people at the DOL, for all their zealotry, very much wanted to try to get it "right".  I guess a question became, could they get out of their own way and put out something that advanced the DOL's agenda without causing further mass hysteria in the financial market?

While we ERISAns will be parsing the details of the rules for who-knows-how-long, several generalities seem to be emerging quickly. Taking a step back, I don't see how one can read these rules and come away legitimately believing that the DOL has not responsive - to one extent or another - to legitimate market concerns.  The changes from the 2015 reproposal are deep and meaningful.

In this regard, the DOL had from the beginning said that the intent was to allow existing products to continue and to allow market-based compensation structures to continue to be used, albeit with new conditions.  Those statements seemed to ring hollow - sure you can still do all this stuff, just by complying with rules and principles that you will in no way ever be able to satisfy.  (You can cross the street, so long as you don't cross the street.)  One might have wondered who the heck was the DOL to be requiring investors to suffer asset-based fees even if they prefer commissions.  One might of wondered who the heck the DOL was to decide that a willing investor has no practical way to be offered the opportunity to invest in a private fund.  And the list went on . . .

Well, the ship has now veered here, too.  It seems clear, for example, that the use of commissions and the offering of proprietary investment products will be doable, with some bells and whistles that may give rise to some discomfort but that would not appear at first blush to render proceeding utterly undoable.  Some other demonstrative examples are:

- Generally speaking, there needs to be a "recommendation" of some type before fiduciary status attaches.

- Efforts to get hired are less likely to be fiduciary in nature.

- Exceptions for "selling" investments are expanded.

- The rules for call centers and the like have been made more flexible.

- Applicable disclosure requirements have been pared back.

- Investment "education" in certain circumstances will be able to identify specific potential investments.

- The BICE will be available with respect to broader types of plans.

- No separate contract will be required under the BIC exemption (which is pretty funny, when you think about the fact that the conditions of the "best interest contract" exemption often won't involve requiring a contract).

- Where contracts are required in order to satisfy a condition in the BICE, the associated mechanical requirements have been streamlined and simplified.

- The BICE is not restricted in its application to specified asset classes.

- The beginning of implementation is generally pushed out a year, and implementation is staged thereafter.

Undoubtedly, there's much to work through, but hopefully the rules are largely workable.  The devil remains in the details, so upon further review things could still turn south.  But that doesn't seem to be where we're fundamentally heading.

But maybe that's just not what happened.  Arguably, the less ambitious final rules would seem in some ways to complement and overlay the rules that have been developed over the years that have increased fee transparency (see the development of the rules under 408(b)(2) and in connection with the filing of 5500s; see also the 404(a)/(c) rules relating to participant-level disclosure), and, frankly, already pushed any number of arrangements towards alternative fee approaches.  Rather than setting up a whole new primary regime where everything else sits underneath, maybe these final rules live in and serve to bolster a world of fee-transparency and increased disclosure.

One way to look at the evolution of the regulation here is that we started with proposals that looked like they would require the reshaping and maybe elimination of a variety of investment products and opportunities, strategies and approaches to compensation.  "What can't I do?" if you will.  And we wound up with conditions and other rules of the game.  "How do I do it?" if you will.  If that's a fair characterization, then this regulatory ocean liner really did experience quite the sea change.  After maybe a bit of a "Rush" to judgment about the regs., it's possible that the DOL may get its chance to bask a bit in the "Limelight", after all.  (Sorry.)

Honestly, though, good for them.  After all, their hearts have always been in the right place.  Maybe they got something done here that gets to the nub of what they were going after, while at the same time scaling back some of the earlier ambitiousness walking away from some of the overbreadth, stridency and unworkability of the earlier proposal and reproposal.

It had appeared that what we might have been faced with here was a comprehensive new regime that essentially would color and fundamentally impact an incredibly broad array of financial products and relationships.  Indeed, given the desire or even need of many financial organizations to standardize disclosures and other practices, one could legitimately have wondered whether the rules were about to bleed over into the realm of personal accounts with no retirement component whatsoever.  What, if anything, was to be left to do by the SEC?  I'm not sure the debate and discourse will continue to be framed in this way in light of the final regs.

And there was talk of lawsuits.  Does the DOL have the authority?  Was the APA fully satisfied?  It remains to be seen whether chatter of that ilk continues to the same extent.  There's always a kid-who-cried wolf concern, where the sky is asserted to have fallen yet again, while maybe it hasn't quite done so. But, as noted, things still need to be worked through.  And certainly there could be be market segments that wind up being more adversely affected than others.

So how big is all this really?  Pretty big.  The President cares.  Financial-services organizations were in a palpable tizzy.  And a number of financial stocks got a bump up, and some went a tick down, on the news that the final regulation might not be as bad as had been feared.

All in all, in the brave new world of the now-final regs., has the DOL found a balance that is more ideal than the ones struck by the old '75 balance and the 2010/2015 proposals?  Certainly, it still remains to be seen.  But at least we've maybe gotten to . . . maybe.

In the end, a regulation governing a defined term in ERISA has been embraced by the President of the United States, and now has apparently had an impact on the stock market.  I like my area of practice, to be sure, but I'm not even sure that I would've seen this coming.  Cool.  And now, as the Foo Fighters might say - done, done and I'm onto the next one . . .

Tuesday, March 29, 2016

Employment Law in the Land of Saul, Redux

Warning: SPOILER ALERT.

Well, just last week, I noted that Better Call Saul had found its way to issues implicating employment law.  Now, a mere one week later, we return to world of employment terminations.*  As I said last time, someone in the Saul universe sure knows this employment stuff.

This time, the show explores quite sophisticated issues surrounding an attempt to get oneself fired without cause, in an effort to avoid voluntarily resigning.  Rarely if ever has such a gambit been pulled off with Jimmy McGill's aplomb.  Modeling one's workplace performance on Wacky Waving Inflatable Arm Flailing Tube Man probably isn't ordinarily the trajectory to success with this strategy, but it sure did work for Jimmy.

This maneuver is one of the oldest and most venerable tricks in the book.  This is a highly nuanced context, where there can be a collision between such things as (i) the employee's not wanting to forfeit (or, in this case, return) compensation, (ii) the terminating employee's trying to retain entitlement to severance (not an issue in the Saul episode in question), (iii) reluctance on the part of the employer to assert cause, even where there may be a strong case for it (we saw this in the Saul episode), and (iv) a range of other nonlegal (and maybe even distinctly personality-driven) considerations (we certainly saw this in the episode).

And a key contextual point needs to be kept in mind: the natural inclination against wanting to be involved in litigation, on either side, is maybe as strong as ever in the employer/employer relationship.  The kind of personal barbs that tend to go back and forth, and the desire to cut the cord and simply move on rather than wallowing around in the muck of a messy divorce, contribute to an understandable desire to avoid protracted and public conflict.  The Saul episode hits these touchpoints will skill and precision.

Watch the way the foregoing plays out in the following exchange:

****
Ed Begley, Jr.'s Clifford Main - You win.

Bob Odenkirk's Jimmy McGill (eventually aka Saul Goodman) - What do I win?

Cliff - You're fired.

Jimmy - What?  Cliff, if this is about the bagpipes . . .

Cliff - It's not about the bagpipes. . . .  Well, of course it's the bagpipes.**  It's the bagpipes, and it's the not flushing, and this . . . this optical migraine you call a business suit. . . .  It's about . . . it's about you keeping your bonus, that's what this is about.  Been brushing up on your contract law, haven't you?  You want out of here, clearly, but you can't just up and quit and expect to keep your bonus.  And if I fire you for cause like I should have done for the TV commercial, again no bonus.  However, if I fire you not for cause but for being an all-around jacka**, . . . yeah, hooray for you.

Jimmy - If you think there's been some malfeasance here . . .

Cliff - Oh, save it.  I can fight you on this but you're not worth my time.  I'd rather just have you gone.

Jimmy - I'm sorry you feel that way.  I'll just pack up.
****

That's a pretty impressive capturing of the applicable dynamics, if you ask me.  It's all good, man . . .

----------
* See also my earlier post on terminations of employment.

* A new bagpipe question emerges.  Which set of out-of-place bagpipes is more fun, Saul's when he finally succeeds in getting fired, or Bon Scott's in AC/DC's "It's a Long Way to the Top (If You Wanna Rock 'n' Roll)"?

Tuesday, March 22, 2016

Employment Lawsuit Makes Its Way to Saul

Thanks to Amanda G. for not allowing me to miss this one.  It's not purely ERISA - really more a matter of pure employment - but I've posted on such things before.

The point here is to note a particular exchange between Jimmy and Kim in the fifth episode of the second season of the absurdly good Better Call Saul.  Kim's been treated not-so-well by her law firm.  Jimmy's unhappy with (and feeling more than just a little guilty regarding) how she's being treated.  He goes over to her with a set of typed-up papers, leading to:

****
Bob Odenkirk's Jimmy McGill (aka Saul Goodman (eventually!)) - . . . Here's how we're going to handle this travesty of justice.

Rhea Seehorn's Kim Wexler - Wexler v. Hamlin Hamlin [&] McGill.  You want me to sue my own firm?

Jimmy - Filing's all typed up.  It's ready to go.  This is not my area of expertise.  Alright so, first order of business we get a great employment-law attorney.  Show them we mean business. . . .
****

Turns out that Jimmy isn't thinking discrimination but rather homes in on extortion.  Well, he DID say that the area is not one of his expertise.

Note also that, in the ensuing week, during last night's episode, Rick (sometimes Rich) Schweikert (the venerable Dennis Boutsikaris) reported to Kim that his first big case was a yoooge employment-discrimination case.  Someone on Vince Gilligan's Saul team has done some employment stuff at one time or another, don't ya think?

Better Call Saul really is some ride.  Odenkirk is ridiculously good, and Jonathan Banks, as Mike Ehrmantraut, may be even better.  (Remember him from Beverly Hills Cop, among other things?)  WARNING: SPOILER ALERTS!  The episode where Mike goes after the two rogue cops might be one of the best in television history (right there with the Breaking Bad episode in which Jesse's girlfriend dies), and the later devastating soliloquy during which he bemoans having caused the loss of his son is utterly unsurpassed.

One day, we'll catch up in Better Call Saul to where Breaking Bad began.  As Vonnage (who I (jokingly) contend stole it from me) might say - woo hoo.

Monday, February 29, 2016

Clearing Things Up with EMNAs


A while back, I listed a number of acronyms relevant in the ERISA/compensation world that I thought were sorta funny.  Examples included SLOBs and STDs.   I've come upon another one.

Bank regulators and the CFTC recently finalized their rules on uncleared swap margin.  One of the provisions provide for the concept of an “eligible master netting agreement”, or EMNA.  Say it quickly.

Here's some background. If a determination regarding the ability to effect certain close-outs is not (or cannot be) made, then the dealer may be required to post and collect certain additional margin.  Going forward, among other changes to what has been dealer practice, margin may need to be collected on a gross basis.

It remains to be seen how the EMNA changes may impact banking/dealer practices where ERISA plans are on the other side.  Or maybe another way to frame the issue is: let's see how everyone's . . . ahem . . . clearing systems are affected by . . . ahem . . . EMNAs.*

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* I know - that's just . . . "gross".

Sunday, February 28, 2016

Ennio Morricone - the Good


I apologize in advance for this one - no ERISA connection here, and, admittedly, a crass self-reference.  But I just HAD to point out, in light of tonight's Oscar festivities, a comment in a prior post that "[t]he best soundtrack for any movie ever might well be Morricone's for The Good, the Bad and the Ugly. There are long stretches of the movie, including the climactic scene, in which the music IS the dialogue."  (And to think that he finally gets his Academy Award for a movie made by the guy who made my favorite movie of all time (Pulp Fiction).)  A fun moment for a benefits lawyer who, for what it's worth, cares about such things.  Congrats, Ennio, and thanks, Quentin.

Sunday, January 24, 2016

Settl-ing? - Well, at Least He Has a 401(k) . . .

From Vanessa Bayer's turn on Saturday Night Live's mock (?) advertisement for Settl, a new on-line dating service for women who need to get married as the clock goes "tick tock"*:

"That's how I met my Henry.  He may drive a smart car.  But he's a manager at Petco.  And even has a 401(k)."

Ha.

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*  "Because, remember, it's not giving up - it's Settl-ing up."  My wife can undoubtedly relate.

Sunday, January 17, 2016

Archer, Part III: SEPs in a Cartoon - What's Next, the President Talking About ERISA?!?

Well, we have another season of FX's Archer coming up soon, and so it becomes incumbent upon me to pay (or re-pay) ERISA-centric homage to the show.  After my initial Archer post regarding cafeteria plans (!), I followed up with an Archer stock-drop/401(k) (!!!) post.  Going back to the well one more time (for now), and again with a nod to Mike S.'s unparalleled research skills, here's a little ditty from Season Two:

****
Archer to hooker (claiming to have had his baby):   I guess I skipped the Emily Post chapter about how to introduce your mother to a hooker!

Hooker:  Escort! . . .  And I'm retired.

Archer:  Yeah? Your 401(k) doing that well?

Hooker:  I have a SEP, smarta**!
****

SEPs have made it into the world of animated television?!?  Geez, that seems just about as likely as the President of the United States making an ERISA defined term into the centerpiece of a major presidential policy speech.  Oh, yeah, that's right - that happened, too.  See Pres. Obama's 2/15 speech to the AARP (relating to the oh-so-sexy "investment advice" definition under the ever-so-exciting "fiduciary" rules); cf. my post on Justice Souter's retirement (relating to another example of ERISA's impact on high-level governmental institutions).

Saturday, December 26, 2015

The Christmas Zone

I thought there was no way I hadn't seen every original gem contained within Rod Serling's The Twilight Zone, at least those of the half-hour variety. I'm consistently convinced of this supposed reality, and yet, every several years, I find another pearl.  This year's discovery, which turns out to have a Christmas theme, is The Changing of the Guard, with the great Donald Pleasence.

It shows how incredibly times have changed in the world of employment and employment law, and therefore finds its way into this post.  The set-up is that the venerable Prof. Fowler is being terminated.  Here's what he's told:

****
You've been on the faculty for more than 50 years.  You reached the normal retirement age several years ago.  We decided at our winter meeting that, perhaps a younger man. . . .  If you could have been at that meaning, sir, you would have been very proud of the things said about you and your work.  A teacher of incalculable value to all of us.  But, but, youth must be served - changing of the guard, that sort of thing.

. . . .

Discharged?  Oh, no, Professor, please don't call it that.  It's retirement.  And at half salary for the rest of your life.
****

Wow - times sure have changed!

The show, as is the case with virtually all of them, is great.  It's by no means at the level of Art Carney's devastatingly incredible Christmastime Zone entry, The Night of the Meek, but it's certainly a worthy entry in Mr. Serling's formidable archives.

Happy Holidays, all!

Thursday, September 3, 2015

401(k) Plans and Mr. Robot (not to be confused with robo-advice)

Robo-advice is all the range with participant-directed retirement plans, so I suppose it's no surprise that 401(k) plans have made their way into none other than USA's Mr. Robot (thanks to Jon B. for pushing me to watch).

Now, I've been noticing ever since the sub-prime crash that market downturns have consistently been reported by the press through the prism of retirement planning.   To wit, any given downturn seems likely to be reported in the context of how much it diminishes the value of "your 401(k) plan". I'm not talking about financial papers; I'm talking about tabloid reporting.   401(k) plans have become a part of the very fabric of our basic financial lives.

And now they're in Mr. Robot, in the run-up to the climactic scene in the Season One season finale.  To wit:

****
Allsafe Cybersecurity's temporary CFO - Best thing you can do for them is to let them know soon, so they can find other jobs.   And . . .

Michael Gill's Gideon Goddard - What?

CFO - All their 401(k)s were tied up in the market, which is expected to plummet once the bell rings.
****

Later in the same episode, Richard Bekins' James Plouffe laments how his pension, etc., had been wrapped up in his troubled company and is now lost (I'm guessing he was referring to his unfunded top hat benefits?).   Looks like retirement benefits are as omnipresent in the Mr. Robot world as they are in the real world.  I won't go into more detail, as I like to avoid spoilers. 

On a slightly unrelated note, before we leave the season finale, I do want to make note of the fact that the episode features what to me is one of the great songs of all time, Jim Carroll's "People Who Died".  Listen for it, and then, if you haven't previously, listen to the whole thing.  (Yes, "that" Jim Carroll - "The Basketball Diaries" guy.)  

Cool.

Sunday, June 21, 2015

"Inside Out" in the World of 401(a)(4), 410(b) and Disney/Pixar

For years, I've had a way of looking at 410(b) and 401(a)(4).  I've characterized 410(b) as looking at a plan from the "outside in", and 401(a)(4) as looking at the plan from the "inside out".  And then, with the two of them working together, you wind up with a set of rules that comprehensively restricts the ability to discriminate regarding the availability and level of benefits provided under a plan.  I've always thought it was a good way to look at the complementary nature of the two provisions, especially since the 401(a)(4) regulations eventually became in many ways a sort of an intra-plan surrogate for rules of 410(b).

Why do I blather on about this now?  If but for no other reason to have an excuse to tie into "Inside Out", and to wonder aloud whether, for an animated movie, we could have real-world Oscars for things like Best Screenplay and . . . (shudder) . . . Best Picture. 

And how about a new category for Best New Theory of Psychology in a Movie as to the Manner in Which the Human Mind Operates?  Regarding the already-existing animation-specific category, I'm not sure there's a reason even to open the nominations - let's just give them the 2015 award now and move onto any number of issues that, unlike this one, are open. 

(Wow - whatta movie.  Thanks to the folks at Disney/Pixar for such a special Fathers Day gift that I could enjoy with my whole family - one that one of my sons characterized as a movie that would change his life (!).)

Monday, May 18, 2015

The Trouble with Tibble (Part II)

In a prior post, I made the mandatory connection between Harcourt Fenton Mudd and Tibble v. Edison.  The case has now been decided, and I really am not surprised that the Supreme Court has effectively preserved a six-year period for bringing claims for a failure to monitor adequately.  To me, the only real open question was whether the Court would impose a requirement that there be some kind of factual change within the six-year period.  Even that would have surprised me, and the Court, having no trouble with Tibble, did not go down that road.  The Court did clearly confirm a duty to monitor regarding fund selections, although, interestingly, the possibility was left open that, in this particular case, the plaintiffs forfeited their opportunity to argue that a failure to monitor is actionable absent a change in circumstances.  In any event, while there will still be some postscripts here, things are now at least a little more clear than . . . Mudd.

Monday, February 23, 2015

Train Keep A Rollin', Part II - Now It's Fiduciary Rulemaking That's Referred to as a "Runaway Train" (with Goonies and Godfather references included at no extra charge)

In a prior post, I tried to make a pun that took me from a series of songs about trains to the five-year limitation under the 409A regs. on "track"-ing underlying equity payouts.  Well, now none other then Commissioner Gallagher has brought a train-based metaphor into the ERISA world, referring to the DOL's fiduciary rulemaking as a "runaway train."  (And, just for the record, Soul Asylum's "Runaway Train" was indeed included in my prior list of train-themed songs.)  Commissioner Gallagher's remarks were made at The SEC Speaks in 2015.  His language is colorful, to say the least, and I offer the following sampling (emphasis in original) (footnotes omitted), which even includes references to the Goonies and Godfather sequels (!!):

****
[W]e've spent much of the past several years chipping away at the one hundred or so mandates imposed upon the Commission by the Dodd-Frank Act.  At last year's Speaks conference, I delivered an "open letter" to the SEC staff.  Reiterating a theme to which I’ve referred throughout my tenure as a Commissioner, I stated that the Dodd-Frank Act is "a 2,319 page monstrosity that is in substantial part untethered to the causes of the crisis."  Some have objected to this and the many related pronouncements I've made regarding the Dodd-Frank Act over the years.  To them I say:  You should have seen the first drafts!   

. . . .

Speaking of distractions and rulemaking untethered to identifiable problems, I’d like to turn now to a long-anticipated re-proposal, a sequel of sorts – but, probably more like Goonies 2 than Godfather 2.  This rulemaking is based on the premise that an entire SEC-regulated industry is plagued by conflicts of interest. . . .

. . . .

. . . And despite public reports of close coordination between the DOL and SEC staff, I believe this coordination has been nothing more than a “check the box” exercise by DOL designed to legitimize the runaway train that is their fiduciary rulemaking.  Unfortunately, this is par for the course in Washington these days - take, for example, the Financial Stability Oversight Council SIFI designation process for non-banks, where everyone's an expert except for the actual experts.  Although, as I noted, I haven't seen the DOL’s re-proposal, thanks to a White House “memo” shockingly "leaked" to the press earlier this year, I can make an educated guess at what might be included. . . .

Let’s start with some of the claims the White House memo makes.  First, the memo states that “consumer protections for investment advice in the retail and small plan markets are inadequate.”  This overarching statement is not accompanied by any analysis or study of the current protections investors receive from the regulatory oversight of brokers and investment advisers by the SEC and the SROs - in fact, it blatantly ignores this comprehensive regulatory oversight.  Indeed, the memo manages to avoid any mention of either the SEC or FINRA!

Second, the memo states that “the current regulatory environment creates perverse incentives that ultimately cost savers billions of dollars a year.”  I am not going to be drawn into a debate about the studies the memo selectively cites to support this conclusion.  But I will point out that there are SEC and SRO rules directly addressing the so-called perverse incentives referenced to in the memo. . . .

Third, the memo states that “the current regulatory environment allows fund sponsors and advisory service firms to create incentives for their advisors to recommend excessive churning . . . of retirement assets and to steer savers into higher cost products with financial payoffs for the advisor.”  Far be it from me, as a mere SEC Commissioner, to second guess the White House securities law experts, but I do feel obligated to point out that our rules expressly prohibit brokers from churning client accounts, and the SEC and SROs have sophisticated tools designed to monitor for such activity.

Finally, the memo states “academic research has clearly established that conflicts of interest affect financial advisors’ behavior and that advisors often act opportunistically to the detriment of their clients because of payments they receive from product providers.”  This statement, like the others, ignores the existence of the comprehensive oversight and disclosure regime specifically designed to address these underlying conflicts of interest.  

. . . .

To be blunt, the White House memo is thinly-veiled propaganda designed to generate support for a widely unpopular rulemaking.  Seven years after the height of the financial crisis, it is obvious that some remain intent on not letting it go to waste.  Perhaps it’s time to acknowledge a little nuance.  It’s easy to shout about conflicts of interest and vilify any potential practices that involve them, even if it means taking entire swathes of investment products off the table.  It’s a lot harder to establish a regulatory system that balances mitigating conflicts and effective disclosures with expanding investment opportunities for the good of individual investors and the economy as a whole, as the Commission has done for decades.  In a matter of this import, we should not shirk from our path simply because it is difficult.
****

It's somewhat hard to embellish that, so I'll just leave it there.

(Although I will say one more thing, on a totally unrelated matter - congratulations to Birdman.)

Wednesday, February 4, 2015

Archer, Part II - From the World of Welfare Plans to the World of Pension Plans

Just as USA Networks' "Suits" merited multiple xtremerisa posts here and here, it turns out that FX's Archer merits an additional mention as well. 
 
My prior Archer post, which came about based on a tip from Mike S., focused on welfare plans - specifically cafeteria plans and life-insurance plans.  Well, Mike's research skills are unbounded, and it turns out that Archer also covers the pension side as well.  Indeed, there is significant attention to 401(k) plans invested in stock.  Archer has found its way into the world of ERISA stock-drop litigation!  It really does seem that the show is written by a bunch of ERISAfolk.
 
Thus, the following is from a script of Season 1, Episode 7, which on this particular point has attracted some additional attention on reddit, one finds the following exchange, relating to a would-be bomber's attempt to blow up a certain luxury airship named the Excelsior as an act of vengeance for having been tricked into putting his 401(k) account into company stock:
 
****
Capt. Lammers:  "Keep your 401(k) in company stock," they said.  "The price can only go up," they said.  Well, guess what . . . .

Sterling Archer: Um, it didn't?
****

Further to this exchange, a blurb from wikia (laced with ERISA considerations) regarding Capt. Lammers says:  "Employees of companies are often encouraged, as was Lammers, to put their retirement accounts into company stock.  This serves the dual purpose of tying the self-interest of the employee to the success of the company and inflating the price of the stock.  Executives of some less scrupulous companies have famously encouraged this even though they knew the stock was soon to be worthless."*

Wow.

And there's more.  The following is from somewhere in Season 2

****
Sterling Archer:  Lana, what are you mad at me for?  Mother took your 401(k).  All I did was foolishly gamble it all away.   

Ray Gillette:  . . . He does have a point.
****

And there's still more.  Apparently, based on a blurb about Sterling Archer, he has $480,810 in his 401(k) account (although according to the blurb he "was unaware of it"), and, based on a blurb about Dr. Algernop Krieger, he has $105,526 in his 401(k) account.  Talk about attention to (ERISA) detail!

Should all aspiring ERISAns be watching this show?!?  Maybe so . . .

________
* The blurb also states:  "His plan was to make the money back by 'shorting' the stock (which would result in a significant gain as the price of the stock went down)."  Pretty deep, no?
 

Monday, February 2, 2015

Cafeteria Plans, Flexible Spending Accounts and . . . FX's Archer?!?


So, this is pretty funny.  Thanks to my dear friend Mike S., I have come upon some pretty intense cafeteria-plan humor.  (Betcha never thought you'd seen that concatenation of words anywhere!)  The source of this treasure trove of hilarity rooted in beloved Section 125 is none other than Archer, the extremely off-color animated series from FX.

Thus, at Basement Rejects, one finds the following synopsis of Episode 2 from Season 1:  "[The Agency] is forced to switch its flexible spending account, and Cheryl Tunt . . . and Pam Poovey . . . get access to everyone's accounts." 

And then, there's the following extended exchange from Episode 6 of Season 1 I've pulled from a purported script for the show (an except with some screenshots can also be seen here), which hits a number of benefits-related items, including some pretty sophisticated Section 125 considerations.  Here goes (I may not have the following transcription all exactly right, in terms of text and speakers, but you'll get the idea):

****
Cyril Figgis: . . . Well, every . . . agent has a company-issued life-insurance policy. 

Sterling Archer:  And, uh, --

Lana Kane:  And what?!

Archer: You're my beneficiary!

Lana: Your what?!

Archer: On my company life insurance!

Lana:  Oh my God!

. . . .

Archer: . . . Right after I get back, I am changing that stupid policy!  Ugh!  Yes, you're my beneficiary. 

Lana:  How'd you get life insurance?  Don't they know you're in the danger zone?

Cyril: But that doesn't mean anything.  I mean, they could've forgotten to fill out new beneficiary forms, or -- They have to update those bennie forms every quarter.

Cyril: But that means -- oh, my god!

Dr. Algernop Krieger [clearly no relation whatsoever to a certain ERISA lawyer par excellence]:  . . . What?!  Benefits!  D'oh - I forgot to spend the balance in my goddam flex account! 

Pamela Poovey from HR [in a . . . um . . . compromising position, but you'll have to view the episode if you want to know more]:  Are you date of employment or --

Krieger:  Calendar year!

Cheryl Tunt:  Ouch.

Cyril:  That's just leaving money on the table.  How'd you forget that?

Krieger:  I guess I was busy fantasizing about Archer and Lana . . . .

Cyril: (crying)

Pam:  Cyril, c'mon, hon.  We all were.

Archer:  And you expect me to believe that. 

Lana:  I don't care!  Just like I don't ever think about you! . . . .

Archer:  . . . So, when you filled out your insurance forms, you weren't thinking about my tan, muscular . . . ?

Lana:  No!  I wasn't!  I don't!  I mean, I'm --

Archer:  . . . Lana, your eyes are amazing.

Lana:  Archer --

Archer: . . . but -- What is your problem?!

Lana:  You!  And plus, I have a boyfriend!

Archer:  Oh, right. How could I forget Mr. Cling [Cyril]?  Cyril!  Cyril, come on!  Let go!  God, he's stronger than he looks!

Krieger:  Get him out of here!  Because these corporate bagmunchers owe me $630 for my goddam flex account!  I cannot believe you shot me!  God, you know how much I hate that!
****

Someone clearly had a traumatic experience with flexible spending accounts, huh?  As Mike hilariously suggested to me, the writer apparently "got used-or-losed".  (Well, it could always be worse - the writer could've been Pete Carroll.  (catty, I know, but I couldn't resist))

Thursday, January 1, 2015

Restrictive Covenant, Sweet Restrictive Covenant - A Legal Lesson From Mötley Crüe

My son took me to see Mötley Crüe at "the" Garden towards the end of last year (pretty cool, huh?), and, believe or not, the concert made me think of the various state laws governing the enforcement of restrictive covenants. I'll try to explain.

We're inundated with tours of bands that have at best a tenuous connection to the "real" bands that they pretend to be. Names from the 50s and early 60s in particular crop up with nary a single person in the group who has any particular connection to the group that played under those names during their respective heydays.

Now I take the point that I need to be careful before over-generalizing. Bands do evolve, and they're still the bands they pretend to be. Particularly where personnel change in the band's prime, the band is still the band. Guns 'n' Roses didn't stop being G 'n' R just because Matt Sorum replaced Steven Adler. (On the other hand, the departure of Slash and everyone-else-other-than-Axl is clearly a different story.) I'll go out on a limb here and say that no one would argue that the Beatles just weren't the Beatles without Pete Best, regardless of whether he left before or after the band first adopted its name. Even major players can depart and leave the band intact. Say what you want, but Van Halen was still Van Halen during the Van Hagar stage. Black Sabbath didn't cease to be Black Sabbath with Dio, regardless of how much one might've yearned for the Ozzy days. And just look at Brian Johnson's AC/DC. (But please DON'T look at the once Halford-less Judas Priest.)

There are interesting spins (as a DJ might say) on this. Styx without Dennis DeYoung. Foreigner with only Mick Jones. Journey with the guy from the Philippines. In the Styx and Journey cases you had major players replacing lead stars after the band's creative period had essentially passed. In the Foreigner case, you conversely had an almost total recasting of the band by its driving force, but again after the band's creative period had passed. I'm not quite sure whether these are the bands they pretend to be (although at a minimum they sure do sound pretty good, if you ask me).

There are countless other examples. At the end of the day, then, when is the band no longer the band? Maybe the answer ultimately lies with the ol' reliable Potter Stewart saw, ". . . I know it when I see it." Jacobellis v. Ohio, 378 U.S. 184, 197 (1964) (Stewart, J., concurring) (referring to pornography).

Now enters Mötley Crüe to put a whole new "spin" on the topic, with the original members having signed a "Cessation Of Touring Agreement." This bit of cleverness is an actual written agreement that obligates each of the four original/final members of the band not to tour under the "Mötley Crüe" name.

According to one report, a certain attorney has derided the agreement as potentially being unwindable, with the concurrence of all four signatories. The concept underlying the criticism is that there is no guaranty that the "Final Tour" will be the "final" tour, in that the Crüe can always tour again with the not-so-unlikely eventual concurrence of all four members.

While maybe it's indeed true that the agreement can be terminated or otherwise unwound, focusing on that possibility, to me, completely misses the point. I don't see the importance (or even desirability) of the agreement as being that Mötley Crüe can never tour again. I know that the spectacle of Kiss-like "final" tour after "final" tour (and so on) can be disturbing. But seeing the Crüe together again could be electrifying and exciting if the reunion were timed and executed properly, and I don't think that I want it absolutely guaranteed that such an eventuality is literally impossible. Forever is a long time and, as one famous spy might say, never say never again. (It's worth noting that maybe someday they'll want to get together for charity, making any real impediment to reunion arguably yet more unfortunate.) Thus, I'm not sure that a truly permanent anti-touring result would necessarily be a good thing, even if it were doable on an enforceable basis.*

Rather, I see the significance of the agreement here as being that, when you think about it, there can never be a "Mötley Crüe" with ANY of the original bandmembers that doesn't have ALL of the original bandmembers (i.e., a "Mötley Crüe" that isn't "really" Mötley Crüe), while all of them are still alive.** How clever and creative! Four guys get together and effectively confer on each of them personally and severally the power to stop the others from diluting the brand and messing with their collective legacy . . . regardless of what the record company wants or says. No cheap (Mötley?) imitations; no fights over whether the band is really the Crüe; no protests about how the record company has some nerve trotting out a quasi-Crüe; etc. Justice Stewart's surmise would seem to have been rendered moot, as applied to the Crüe.***

So, after enough time has gone by, maybe the Crüe will once again want to Kickstart Their Hearts, and maybe, after all, we'll want to see that . . . especially if we're talking about the unadulterated original line-up. If there is to be more from these guys, that's the possibility that the agreement here would seem to have both preserved and assured. Hey - I wonder if over time we're going to see other contracts of this type, maybe pitched more as anti-imitation or anti-replication agreements as opposed to anti-touring agreements. (Are you listening, Rush and U2?)

I think that it's all verrrrrry interesting (as Artie Johnson might've said). Who woulda thought that Lee/Mars/Neal/Sixx, with a little help from their lawyer, would come up with such a fascinating legal play? It's a Feelgood move, if you ask me.

And, of course, with no connection at all to any of the foregoing, HAPPY NEW YEAR!!

______________________________
* I suppose that, if they truly wanted to make it a tour-cessation agreement, they could've gone another extra step of purporting to make, let's say, each of their fans into a third-party beneficiary of the agreement. Then, at least on the face of it, any fan who's unhappy with the notion of a reunion might have standing to stop them. I'm not sure a court would give that kind of power to purported third-party beneficiaries in that manner, but it could make for a fascinating inquiry. As noted in text, however, I'm not sure that a truly permanent anti-touring result would necessarily be such a good thing.

** I'm assuming, in this regard, that the agreement has a bulletproof and enforceable (even in California?) specific-performance provision.

*** I suppose that whoever owns the name of the band could in theory trot out four totally new pretenders, but in this particular context I'm not overly worried about that.

Saturday, December 6, 2014

A Contribution from Y2K to the Repository of Classic Christmas Music

Well, it's ChristmaHanuZaa time again, and, as I did once before, I'm again going to go out with a post at the Holidays with no ERISA tie-in. This time, here's a note on Xmas music. (I guess I could try to make some kind of strained connection between the "contribution" reference in the title of this post and a reference to "employer contributions", but I won't do that.)

I've always been a big fan of Christmas songs, with "Feliz Navidad" probably being my favorite from way back, heading into the '90s. But I also look for new standards, too. And when it comes to American pop culture, one so often finds the path to Saturday Night Live. In the case of Holiday music, one iconic example is Adam Sandler's little Hanukhah ditty. I think that, if you watch the interplay between Norm MacDonald and Adam Sandler during the initial roll-out of "The Hanukhah Song", you can see they knew that something special had occurred, even if they didn't realize the extent to which it was truly special. More on SNL in just a moment . . .

For years, my own personal favorite Christmas song has been from Mariah Carey. Back in '94, she released an album with at least two stellar efforts. One is "Christmas (Baby Please Come Home)". The other is "All I Want for Christmas Is You", which, having supplanted "Feliz Navidad" at the top of my list, continues to be my all-time favorite.**

Now we come back to the ubiquitous SNL and the year 2000. The first time I heard/saw Sanz-Fallon-Kattan-Morgan do the grammatically challenged "I Wish It Was Christmas Today", I was blown away.*** I was quite gratified over the years to see it coming back in incarnation after incarnation. I really think we've got a keeper here - particularly with Jimmy Fallon's ascension to the Tonight Show perch, where he'll presumably be for decades. I did a triple-take when just the other day I heard the version by The Strokes' Julian Casablancas for the first time (where have I been since 2009?), playing over an Acura commercial. A terrific chronicle of the history of this unlikely entry on the roster of tier-one Christmas songs, with a whole bunch of great links, is on the Slate website. Check it out. See also the utterly spectacular 2009 rendition of the song performed on Late Night (I won't spoil it for you with any details).

Happy Holidays!
_________________
* As a general matter (and as I've previously indicated ), it often fascinates me when something enters the Collective's consciousness as a long-term (and maybe even very long-term) keeper. I wonder how often those who create new pop-culture fixtures realize in real time that they've captured lightening in a bottle? I once heard the Pink Floyd guys saying that they really did know right away that they'd done something special after wrapping DSotM. Another angle on this is reflected by the Black Eyed Peas, who I think actually tried with forethought to come up with a forever-type piece when they did "I Gotta Feeling" - it must be something to aim that high intentionally and ultimately succeed.

** Could there have possibly been a better song for use in one of my favorite movies, "Love Actually"?

*** I remember being in similar awe when I first saw Andy Kaufman's "Mighty Mouse" thing.

Friday, November 7, 2014

An Un-Affordable Prediction

OK, I'm going to go on the record here - if the Republicans take the presidency in 2016, then the ACA is essentially gone within the six-week period to follow the election. To be clear, this is not advocacy; it's just a prediction. Hey, take it from the one who confidently predicted that Gangster Squad was going to be the next big thing after Argo!* I understand all of the too-hard-to-unwind, too-entrenched, too-good-for-the-insurance-companies, etc., etc., etc., arguments.  But, hey, notwithstanding all of that, I'm just sayin' . . . .

________
* See the arguably quite unfortunate footnote to my Argo post. (Although, just to be fair, I sure did call it right regarding Argo, didn't I?)

Sunday, October 26, 2014

Nomenclature, Part III

Emerging out of a conversation with my friend Peter H. is a realization that the ERISA/compensation practice has given rise to or at least made use of some pretty racy and otherwise interesting nomenclature. (See also my earlier nomenclature posts here and here.) Some examples, in no particular order:

SLOBs - a messy way to deal with trying to address 410(b) issues*

STD - something with which you DO want to get infected while dealing with Section 409A**

SARs - compensatory interests so prevalent that one might say they've gone viral

VCOCs - pronounced "vee cee oh cees" by some (including me), but "vee' cox" by those who must be trying to come up with sexy new devices with which to address "plan assets" issues from both sides***

CoC - is it any wonder that the 409A regs. gravitated to the altervative "CiC" terminology, which seems much less hard to use?

blown grandfather - something that just has to be awful in situations in which one is dealing with trying to satisfy transition rules that may no longer be enjoyed

PU - an acronym for phantom units so odorous that it (really) may help explain the evolution in terminology to "restricted stock units"

rabbi/secular/rabbicular trusts - oy

ERISA - forgive me for resort to the trite old standby of "Every Ridiculous Idea Since Adam"

There must be more, but I figured I'd get these out there.

_______________
* Do they really think that "QSLOB" is a materially better acronym?

** I try to use "S-TD" in order to address this issue, but I'm not sure I'm really accomplishing much.

*** And then, of course, there are "springing VCOCs".

Monday, October 6, 2014

The Trouble with Tibble

 
I got nowhere to (boldly) go with this right now, since all we really have in the Tibble case at the moment is cert. granted on a limited issue, albeit in an extremely high-profile excessive-fees case. But there was no way I was going to pass up the opportunity to do a post entitled, "The Trouble with Tibble". (Thanks to my friend Jeff S. for the idea.) Maybe I should at least say that the issues are . . . ahem . . . clear as (Harcourt Fenton) Mudd?

Saturday, September 13, 2014

401(k) Plans Go Undercover, Brother


I guess I know that, by this point, 401(k) plans are so much in the fabric of everyday life that there frequently are going to be references to them in the movies.  Nevertheless, going all the way back to 2002, I figured I'd share this particular one, which jumped out at me the other day as I watched the Undercover Brother (Eddie Griffin) being prepared for an oh-so-trecherous foray into the world of the Caucasian:

****
It'll be a very dangerous assignment. It'll be your most vigorous training yet. You're gonna have to think and act just like a tight-butt white man with a 401(k) plan and a country club membership. So pay attention.
****

Ha. 

Tuesday, August 5, 2014

Let It "Roll on Down the Highway" - ERISA Glides Smooth-ly Onto Jon Stewart's Radar


Thanks to my friend Bruce C., actuary extraordinaire, here's a link to The Daily Show's take on "pension smoothing" and the use thereof to (ahem) supposedly "fund" the Highway Bill.  ERISA arrives on Comedy Central!!*

 _______
 * There's so many puns and connections I could have used for this post, but I went with BTO's "Roll on Down the Highway," just 'cuz I think it's one of the best songs - and maybe the single best driving song - about which no one seems to care.  The Daily Show went with Shabby Road, steering towards The Beatles, and another example would be Road to Nowhere, courtesy of the Talking Heads.

Tuesday, July 1, 2014

You Don't Know . . . ERISA (courtesy of Jellyvision)

Well, this will be obscure for many, but I may have stumbled upon the ultimate convergence of ERISA and Pop Culture (other than this website?).  I got a cold call from a nice guy at Jellyvision.

"Jellyvision".  It rang a bell.  I asked him where I could have seen that name.  The answer was, of course, that Jellyvision is the maker of that unsurpassed gaming experience known as, "You Don't Know Jack".  The game is a rollercoaster ride down the road of Pop Culture, and, back in the day, was a (the?) centerpiece of entertainment activity in my home, for the entire family. 

So why the heck is Jellyvision calling me?!?  The answer is that Jellyvision is marketing a product with a YDKJ feel that - get this - is intended to help Human Resources departments communicate employee benefits and health-care reform to employees.  (You just can't make this stuff up.)  And they got my name because I've got a connection to HR, even though, as things would have it, I'm only the lawyer. 

What're the odds?*  I'm a YDKJ junkie; the YDKJ people make a foray into employee benefits; I'm an employee-benefits lawyer; I've got some cockamamie website purporting to explore the intersection of ERISA and Pop Culture; and, totally at random, they call . . . ME!  I felt like they had a camera in my house during the halcyon days of YDKJ.

Hilarious, not to mention fun.  Or, as the YDKJ emcee might have said, "Uh, . . . no."

(As an aside, I would note that they also alerted me to a wild-and-crazy video at this link of what might be about as good a corporate presentation as you'll ever see.) 

________________________
*  See also my prior odds-related post

Saturday, April 5, 2014

Dude-nhoeffer Looks Like a Lady . . . With the Moench-ies

The oral argument in the Fifth Third v. Dudenhoeffer case was pretty interesting.  It's like they forgot to talk about the case before them.  Maybe they were looking at the Sixth Fourth First Ninth Tenth case?

I guess the Supreme Court sometimes gets sidetracked with these "numbingly technical cases involving applications of pension or benefits law".  See my earlier post 
on Justice Souter's retirement.  In Kennedy, they realized they granted cert. on the wrong issue and had to re-up the grant to cover the issue that was ultimately dispositive in the case.  Regarding Amara, they decided an issue that wasn't decided below or briefed to the Court at all, leaving one to wonder whether they ever got over not granting cert. in  the Amschwand case.  And now, in Dudenhoeffer, they seem to have the DOL's Enron brief on their mind as they focus on an issue - the intersection of ERISA and the securities laws - that is quite far from the heart of the Dudenhoeffer case.  Wheeee . . .

Returning to what's really at issue in Dudenhoeffer, if I may, I'm somewhat surprised that commentators and the Court aren't generally focusing more on the apparent requirement in the plan there that it be invested in employer stock, viewed through the prism of the "plan documents" rule (as the Kennedy case refers to it) of 404(a)(1)(D)
.  Rather, the approach has been to frame the question in terms of whether there is a presumption in favor of investment in stock - a la Moensch.*

Framing the question in terms of whether there's a presumption leads to potential hostility at the Supreme Court level towards an asserted presumption that isn't expressly in the statutory language.  The oral argument, to the extent it briefly addresses the presumption issue, seems to reveal such hostility.  
To me, at least for plans that mandate stock investment (as the plan in Dudenhoeffer arguably did), the question may well better be framed as whether the statute itself validates an investment in employer stock, not whether there is an implied rule of presumption that emanates from the statutory penumbra.
 
My thinking is as follows:
 
1.  ERISA, in Section 404(a)(1)(D), says that you have to follow plan documents insofar as they are consistent with ERISA (providing specifically that a fiduciary shall discharge the fiduciary's duties "in accordance with the documents and instruments governing the plan insofar as such documents and instruments are consistent with" a wide range of ERISA provisions).  This is a command - it's mandatory.  If the plan tells you to do something, you must do it, unless to do so is illegal.  The DOL has recognized this directive in the context of the employer-securities question going all the way back at least to its seminal brief in the Texas Air case.

2. A.  The DOL has with some success interpreted the "insofar" language in 404(a)(1)(D) as sweeping in, among other things, ERISA's prudence requirements.  While that's not necessarily a completely obvious connecting of the dots, the approach has been broadly accepted, and at this point seems almost axiomatic.

B.  The range of prudence is generally broad, so it would seem to me that there wouldn't be a prudence violation for following governing plan documents unless the action (or inaction) in question could be shown as falling altogether outside the range of prudent (i.e, permissible) behavior.  I would argue that merely showing some some murkiness surrounding the appropriateness of a given decision isn't enough to establish the imprudence (i.e., illegality)
 of the decision.  I would think that you'd have to show that the decision is outside of the bounds of the range of prudence.

3. A.  Now take a plan provision that says that a plan, or a particular investment fund under a plan, must be invested 100% in employer stock.  What one is left with, then, if the provision requires specified fiduciary conduct by dictating a particular investment (more on that later), is a requirement that the plan be and stay invested in the stock unless . . . it is affirmatively outside the range of prudence. That's an important point, I think: it's not that you CAN invest or stay invested; it's that you must.

B.  The point is arguably strengthened in the context of statutory provisions that provide relief for investment in employer stock.  The point, for me, is not that the provisions in the aggregate form some kind of ethereal presumption, but rather that an analysis allowing a fiduciary to follow a plan provision requiring investment in employer stock unless the decision can be shown to be imprudent flows from the statutory langague of 404(a)(1)(D) and (!) is consistent with the overall statutory scheme.  It may be a subtle difference in some ways, but the crucial distinction, I think, is that the analysis I'm suggesting does not involve the identification of an extra-statutory presumption.

4.  So, then, my argument goes, once the fiduciary determines that a given course of conduct is within the range of prudence (or, at least, is not imprudent), the fiduciary must (as opposed to can) follow the plan documents and, at least where the plan requires investment in employer stock, and must (as opposed to can) invest and stay invested in the stock.  This result starts very much to resemble a presumption in effect, but not as a matter of analytical structure.

Thus, this analysis is not really a Moench analysis, as it doesn't derive a free-standing presumption in favor of investing in employer stock from the penumbra of the network of ERISA provisions that facilitate and arguably encourage the holding of employer stock.  I think the approach I’m suggesting is more of a strict application of the plan-documents rule of 404(a)(1)(D), in the context of the inapplicability of the diversification rule to eligible individual account plans investing in employer securities.  The Moench approach may well effectively get you to the same place, but I think the two approaches are not at all structurally identical.

I would further suggest that the Supreme Court has laid the groundwork for this line of reasoning. MetLife, Kennedy, McCutchen and Himeshoff all emphasize the primacy of the plan document. To quote McCutchen, "The plan, in short, is at the center of ERISA."**

So maybe the Moench-ies have it right, from a result-oriented perspective?  I just think the approach that focuses on finding a presumption, rather than an approach that flows more naturally out of the statute as I've outlined above, may grate with the Court.  I’m only suggesting that the Moench presumption, with its arguably somewhat dissatisfying technical underpinnings, may not be the only way to get to a result that many of us think is the right one under ERISA.***

Having said all that, I take the point that the analysis I'm suggesting has not been a real focus of the discourse.  Rather, the focus has been on the identification of an implied presemption.  Indeed, Section 404(a)(1)(D) is not even cited in the Dudenhoeffer oral argument, and there's only a fleeting reference to the requirement in the plan at issue in Dudenhoeffer that the plan be invested in employer stock.

But I remain undaunted.  As Steven Tyler's said, referring back to an old saw while on his American Idol perch (and, thankfully, allowing me to loop all the way back to this post's title): "If I agreed with you, we'd both be wrong."

 _____
* I’ll resist the inclination to say something like, “‘Moench’ a bunch of Fritos . . . .”


** I also think the DOL's FAB on a directed trustee's responsibilities (Field Assistance Bulletin 2004-03) is instructive here, even if not entirely apposite. The DOL essentially asks, at least as to pricing, how it's possible for anyone to be smarter than the market. Buy high sell low, anyone? If people are buying and selling at any given price on any given day, on what basis am I to conclude that they're necessarily wrong (indeed, irrational or at least imprudent)? The outside-the-range-of-prudence threshold seems like a pretty high bar, I would think.

*** The approach I’m suggesting could theoretically support dismissal at extremely early stages of the litigation (albeit maybe not necessarily with the extreme totally-out-of-court approach that has been pursued by the district court for the Southern District of New York in a number of recent stock-drop cases).

Wednesday, February 12, 2014

One for Alanis myRA-sette - Isn't It Ironic?

There's some scuttlebutt out there that the various "ironies" in Alanis Morisette's "Ironic" aren't ironies at all. Well, I think the Administration has given us a facially nice but truly ironic new proposal. The myRA proposal would allow people to set up starter accounts invested in Savings Bonds.

But does anyone recall that the Department of Labor is so adverse to undiversified fixed-income investments that the DOL folks quite specifically refused to allow money-market and stable-value alternatives as QDIAs? Why? Because of a concern that participants defaulted into such alternatives would be on the wrong end of the continuum of potential long-term returns, that's why.

And so what does the administration do? In the name of retirement savings and the encouragement thereof, a program is proposed pursuant to which the only possible investment is a . . . Savings Bond. Now I'm not saying that's necessarily a bad idea. Nor am I saying that I think the QDIA regs. are a particularly good idea in this regard. In fact, I personally don't think that the QDIA regs. should've shut down MM/SV as an alternative. (The timing of the adoption of that approach turned out to have a deleterious and in some cases possibly tragic effect on a number of participants' retirement savings. The DOL was not moved to change the approach in any meaningful way, notwithstanding that Series of Unfortunate Events.)

But, c'mon - regardless of where one comes out on QDIAs, on the one hand, and myRAs, on the other, the same government really shouldn't be pursuing two diametrically opposed policies simultaneously. Indeed, aren't the 401(k) participants who don't make investment elections - people for whom the QDIA rules are there - pretty much members of the same target audience as the one to which the myRA proposal is directed? At the least, if only for the sake of consistency, let's massage the QDIA rules so that MM/SV is a valid alternative for the first $X that goes into the QDIA. Or, conversely, let's change the direction of the myRA proposal to provide for some amount of diversification.

In any event, it seems to me that there should at least be some kind of high-level review before the myRA thing goes too far down the road, so as to try to ensure that the various retirement policies that are being encouraged by our federal government are sufficiently (*shudder*) coordinated. To have a non-MM/SV bent be so harshly entrenched in the QDIA regs., and then to launch a key (State of the Union, even!) initiative that provides exclusively for Savings Bond investment, strikes me as irreconcilable or, at least, just a little bit . . . ironic.

Friday, November 15, 2013

Breaking Bad with Obamacare? - A Comparison and Contrast

Every now and then I'm struck by the care and effort that goes into the construction of a song, a show, a movie, etc., etc. Sometimes things come easy, and sometimes they don't. If you watch the extras on the Sixth Sense DVD, you may be struck by the attention paid to so many details and interrelationships. How much effort went into making sure that Memento "worked"? Breaking Bad was nothing short of incredible in terms of the way that characters and storylines were interwoven into a unified whole. Do we think that the elegant conclusion of The Mary Tyler Moore Show happened by accident? Songs like Stairway to Heaven and albums like The Wall are, I would submit, nothing short of musical tapestries. Sure, some things just roll right out of the minds of their creators. But sometimes the process itself is magical, and leads to magic.

Which brings me (somehow) to current events involving health-care reform. I think that there is a point being missed in the raging debate over Obamacare. In particular, many seem to have forgotten the process by which the legislation initially became law. When Scott Brown won his Massachusetts senatorial election, the only way - creative as it was - for the President to cause the proposal to become law was for the bill that had passed the Senate to be presented to the House. In that way, and in that way only, could the President avoid having the bill sent back for a vote in the Senate, a vote which, it seems clear, he could not possibly have won. Indeed, the Senate bill was in many ways a response to the House bill, and, before the Brown election, there was the clear expectation that material negotiation was about to ensue. The results of this process leading to the enactment of the Affordable Care Act thus included (i) the skipping of a conference, which I submit quite undoubtedly would have resulted in substantial, substantive and fundamental give-and-take between staffers, technical experts and, ultimately, the two houses of Congress, and (ii) the resulting passage by both houses and eventual enactment of what essentially was draft legislation - not-ready-for-prime-time legislation - that did not have the benefit of the conferencing process. I am not trying here to advocate for whether Obamacare is a good or a bad idea; I am simply trying to make the smaller point that it should not be surprising that a landmark law of this reach and complexity is not working out so well, given that the enacted legislation was not the bill that anyone thought would be the final, considered work of Congress.

Tuesday, November 12, 2013

Obamacare and Other Colloquialisms - Obamadvice?

I see that:

- on the heels of the passage of the House bill* that would effectively put a hold on the DOL's reproposal of the fiduciary (investment advice) regulations pending certain SEC action,

- which itself was on the heels of the 10-Senator letter - from Democratic senators, no less - to the OMB suggesting that the DOL "should not issue final regulations in the area until the SEC has completed its work" and stating further "that any regulation the DOL ultimately may propose should be carefully crafted so that it does not upend the SEC's work", . . .

. . . there have been reports and other indications that the DOL will not be reproposing the regulation until Spring 2014, at the very earliest.

Well, THIS is sure going smoothly, huh?  In honor of other recent initiatives that have gone so smoothly, dare I try to coin the phrase, "Obamadvice"?  That's all, for now . . .

__________________
*  The Retail Investor Protection Act, or R.I.P. Act?!?!?  Really?  Seriously?  Are they trying to handicap the likelihood of the regulation's ultimately having any life?  I wonder if I should start watching The Walking Dead for references to these regulations.

Monday, September 30, 2013

From Grand Theft Auto V and 401(k) Plans, to the Obligatory Reference to Walter White

Well, you know we've made the big time, when we get front-and-center exposure in the official GTA V trailer. From the trailer:

****
Michael - We're all professionals. We all know the score.

Lamar - This is legit business.

Franklin - 401(k)s, tax returns and all.
****

401(k)s!! For years, I've been telling people coming into the practice that our efforts are no longer confined to hyper-technical impenetrable back-room issues.  You can even talk about our stuff over the dinner table, with your kids no less. If there was any doubt before, we have, with a role in promoting the utterly iconic GTA V, undoubtedly arrived.

And, by the way, moving from the various and random drugs of the GTA world to, quite specifically, crystal meth of the distinctly blue variety, but staying with the utterly iconic, I have a wistful question. Now that it's over, was Breaking Bad the . . . Best Television Ever? Indeed, maybe so.

Onwards. . . .

Saturday, August 17, 2013

With Apologies to Elton John, Don't Let the Sun Capital Partners Go Down on Me

Don't even get me started regarding the First Circuit's decision in Sun Capital Partners.  This case is the one in which the First Circuit holds that a particular investment fund is a "trade or business" ("ToB"), and therefore, depending on its level of ownership of a certain portfolio company, is potentially aggregated with the portfolio company for purposes of the ERISA rules governing multiemployer-plan withdrawal liability.  I previously had been heartened by the analysis of the district court in the Sun Capital Partners case regarding ERISA's approach to the ToB question, which analysis squarely rejected the PBGC's 2007 Appeals Board letter on the issue.  Prior to the district court's decision, I had been frustrated by the willingness of any number of regulators and judges to play in the tax sandbox without getting input from the IRS (which is the organization that, last I looked, knows just a little something about tax matters), and by decisions which essentially held that, even if under the tax rules there might not be aggregation in a particular case, the ERISA rules aren't required to sync up with the tax rules.  And so now I am returned by the First Circuit to what I regard as the Land of Confusion* by a decision that nullifies the decision of the district court that I liked so much, and effectively replaces it with the thinking with which I disagree that spawns the aggravating aggregation. An important silver lining for me, though, is that I think that the First Circuit actually did a much better job on the 4212(c) issue than the district court (actually, I'm not sure I even followed the district court's thinking on that particular point), and, indeed, the ultimate result on remand may well be that no aggregation is ultimately required in the Sun Capital Partners case.**

But the point of this post is not to argue about Sun Capital Partners.  Rather, the point here is to address an ancillary point that seems to be creeping into the discourse, at least in part because of the light being shined on aggregation issues by the Sun*** case.  In particular, I am starting to hear people express concern that, even if a parent fund is not a ToB, the downstream portfolio companies could be aggregated with each other, if the fund's level of ownership is sufficiently high.  I've previously heard this concern from time to time, but Sun seems to be generating renewed heat**** on the point by virtue of raising the aggregation issue generally.
 
To get to the punch line at the very outset, I think that any concern that downstream companies owned by a non-ToB should be aggregated under 414(c) is borne of a flat-out misreading of the applicable regulations.  (The gauntlet is thrown down!)  My analysis is as follows -

1. Let's start with the regulatory text itself.

A.  The confusion centers in the following passage in the 414(c) regs.:

******
The term "parent-subsidiary group of trades or businesses under common control" means one or more chains of organizations conducting trades or businesses connected through ownership of a controlling interest with a common parent organization if . . . .
******

B. The red herring here is that "common parent organization" as used at the end of the above passage isn’t expressly modified by a ToB qualifier.  The concern as I understand it is that the use of the phrase "common parent organization" is not expressly modified by the ToB concept, so that the sentence could supposedly be read to reach "common parent organizations" that are not ToBs.  But is there really any legal significance to the lack of such an express qualifier?  My answer, as explained below, is a resounding "no".  As I will hopefully show, the concern being expressed ignores the derivation of the 414(c) rules, as well as the language that appears earlier in the very sentence under consideration, and is also fundamentally inconsistent the underlying nature and structure of the rules.

2.  Let's now examine the derivation of the rules. 

A.  The 414(c) regulations bring over the language of the 1563 regs.  This approach makes sense, of course, in that 414(c) refers to 414(b), which in turn operates by cross-reference to 1563.  The gist, or at least a key aspect, of 414(c) is to cause the 1563 aggregation rules to be effective as to entities "whether or not incorporated", so the regs. needed to expand the 1563 rules so as to cover the non-corporate setting.

B. And from where does the language in the 414(c) regulations come?  The answer, as one would expect, is that it comes from the 1563 regs.  Those regs., at Section 1.1563-1(a)(2)(i), state:

******
The term "parent-subsidiary controlled group" means one or more chains of corporations connected through stock ownership with a common parent corporation if . . . .
******

Look familiar?  It should.  The 414(c) rules parrot the 1563 rules, often in a word-for-word fashion, with modification as relevant here only as needed to adjust for the coverage of non-corporate, as well as corporate, entities.

C. Staying with 1563 for the moment, there is no doubt that, in order to be a 1563 parent-subsidiary group, all of the entities in the putative group need to be entities to which 1563 applies.  Thus, the language from the 1563 regs. quoted in "2(B)" above refers to a "common parent corporation".  Then, retaining the fundamental structure of the underlying 1563 rules, the drafters of the 414(c) regs. did a cut-and-paste job on the 1563 rules, and gave us the 414(c) rule quoted in "1(A)" above.

3. Let’s go through the transformation step by step, parsing the 414(c) regulatory language and the way it is derived from its 1563 foundation.

A. First, they replaced "parent-subsidiary controlled group" with "parent-subsidiary group of trades or businesses under common control".  So far so good.

B. Then they replaced "one or more chains of corporations connected through stock ownership" with "one or more chains of organizations conducting trades or businesses connected through ownership of a controlling interest".  Everything still foots.  Identical concepts have been brought over, adjusting merely to expand the potential form of relevant ownership from corporate-only (under 1563) to corporate or non-corporate (under 414(c)).  No squishiness in the language, yet, and all is still well.

C. Then we come to the next part of the cut-and-paste exercise.  They replaced the phrase "with a common parent corporation" with the phrase "with a common parent organization".  Ahhh, therein lies the rub.  While the use by the 1563 regs. of "common parent corporation" here definitively lays to rest any concern under 1563 that subsidiaries might have to be aggregated even though the common parent is not a 1563-covered entity, the 414(c) regs. were not quite so specifically crafted.  In particular, the 414(c) regs. do not expressly append another ToB modifier to the "common parent organization" phrase.  But that’s just an accident of the syntax.  All of the other linguistic substitutions that were used in porting the 1563 language over to 414(c) neatly self-execute the inclusion of the ToB concept.  It’s just that the replacement of "corporation" with "organization" at the final substitution point didn’t happen expressly to subsume the ToB concept.  Because of the way the grammar works, additional definitive clarification for the "corporation"/"organization" substitution would have required the further addition of extra words - for example, the addition of "that engages in trade or business activities" after the word "organization".  The addition of those seven words would, of course, have even more obviously maintained the parallelism between the two sets of regulatory language; but the fact that the drafter of the 414(c) regulations didn't think to reemphasize the point by including those (or similar) as an additional modifier is not a valid reason to misinterpret the words that were in fact used.

4.  So, with that background, let's go back and look at the term that is itself being defined earlier in the very same sentence: "parent-subsidiary group of trades or businesses under common control".  Geez, if that’s not a pretty clear indication that the common parent and the subsidiaries both need to be ToBs in order for their to be aggregation, I don’t know what is.

5.  At this point, I'd like to consider how the rules work – and should work - as a big-picture matter.  Before we all do that thing we so often do and identify words here and there that, when taken out of context, could raise some imagined interpretive issue, can we please made sure that we don't miss the forest for the trees (or, as a mentor used to say, with nary the slightest hint of irony, miss the forest for the bushes)?

A. What I’m saying above regarding the 414(c) rules isn't some tricky linguistic game.  To the contrary, the result I'm reaching is completely consistent with and even compelled by the basic structure of both the 414(c) and the 1563 rules.  Having subsidiaries aggregated under 414(c) where the parent is not a 414(c)-covered entity (i.e., not a ToB) would result in a fundamental structural difference between 1563, which, as noted, clearly and indisputably aggregates subsidiaries of a common parent only when the common parent is also a 1563-covered entity, and 414(c).

B.   I think it's important to note that it's not like the rules specifically INclude a non-ToB common parent as a parent that would activate 414(c) parent-subsidiary aggregation.  Rather, we've got a 414(c) rule that on its face aggregates parent/subsidiary ToBs, but which doesn't happen expressly to reconfirm a second time that the common parent, like the subsidiary, needs to be a ToB.   (Cf. the Verizon case, where an errant cut-and-paste actually did result in a document that on its face provided for the "wrong" result, and my post thereon.)  Obviously, if the 414(c) regs. had specifically said that downstream subs. do indeed need to be aggregated even where the common parent is a ToB, this story would quite be a different one.  But that's not at all what happened.  Here, it's simply that the latter part of the introductory portion of the sentence in question was not as amenable to a straight "trade or business" substitution as was the earlier part, so, unfortunately, the additional ToB language from earlier in the sentence (in the defined term itself) didn’t resurface again at the end of the introductory portion of the sentence.  But to take that lack of repetition and use it to turn the whole 414(c) parent-subsidiary rule on its head from the ground up is, to me, a clear over-reading of a simply substituted word - "organization" for "corporation" - especially where, as here, as noted in "4" above, the defined term in question is "parent-subsidiary group of trades or businesses under common control".

C. Indeed, to aggregate the downstream entities under 414(c) notwithstanding that the common parent is not 414(c)-covered would be flatly inconsistent with the remaining structure of the other rules under 414(c).  Like the 1563 rules, the 414(c) rules have separate regimes for parent-subsidiary groups and for brother-sister groups.  It's in the case of brother-sister groups, and only in the case of brother-sister groups, that 1563 aggregates subsidiaries where the parent is not itself covered by 1563, and the 414(c) rules maintain that fundamental dichotomy.  Thus, under the brother-sister rules of 1563 and of 414(c), you get aggregation of downstream companies which are owned by individuals, estates or trusts, where the owners are not themselves subject to 1563 and 414(c), respectively.  (The individuals, estates and trusts that are the owners would not themselves be part of the applicable "brother-sister controlled group" under 1563 or the "brother-sister group of trades or businesses under common control" under 414(c).)  So now we're going to make the parent-subsidiary rules under the 414(c) regs. act like the brother-sister rules on this key point merely because the word "organization" was used in replacement of the word "corporation" when the 1563 rules were exported to 414(c)?  I sure hope not.  If that kind of a sea change (staying with the Mother Nature theme of this post) to the basic underpinnings of the structure of the aggregation rules were intended, then presumably there would have been some kind of explanatory statement or at least indication to that effect.  I find none, which, to me, is not surprising, given that I think it’s quite obvious that no such sea change was at all intended.  And to those who might ask, "Well, why NOT aggregate downstream portfolio companies of a non-ToB common parent?" - I would say that there are innumerable reasons for crafting the aggregation rules in any particular way, and, in this case, the detailed and extensively developed parent-subsidiary rules just do not effect such an extended aggregation.

Would it have been great if they had said "organization that engages in trade or business activities" instead of just "organization"?  Sure.  Is that what they meant?  Well, sure it is.  If someone had pointed this particular drafting issue out as they were crafting the rule, would they have added words like that?  I suspect so.  Does it matter that the words aren't in there a second time?   Again, I sure hope not.  So if you're moved to wondering why "organization" is used at the tail-end of the 414(c) lead-in without a ToB qualifier, I hope I've provided an explanation.   As I've tried to show, what we've got here are some extra confirmatory words that happened not to have been repeated in the drafting process, not some effort by the drafters to expand the scope of the rule so as to recast the basic regulatory structure from the ground up.

In conclusion, while some seem to have become concerned that the 414(c) rules governing a "parent-subsidiary group of trades or businesses under common control" might somehow aggregate subsidiaries of a non-ToB parent, it seems evident to me that the 414(c) rules were not intended to provide, and do not provide, for that result.  Thus, just like there cannot be a 1563 "parent-subsidiary controlled group" with a non-corporate common parent, there cannot be a 414(c) "parent-subsidiary group of trades or businesses under common control" with a non-ToB common parent.  A contrary interpretation (i) ignores the derivation of the 1563/414 rules, (ii) is inconsistent with the very words used to form the defined term ("parent-subsidiary group of trades or businesses under common control") here in question, and (iii) would conflict with the fundamental regulatory structure under 1563 and 414, even blurring and maybe trivializing the clear dichotomy between the set of rules governing parent-subsidiary groups and the set of rules governing brother-sister groups.

So, how do I really feel about this?  I'll bet my views on this are sneaking through.  Hey, after all, it is Saturday as I complete this post, and, as we all know - Saturday night's alright for fighting!

Cheers! . . .

__________________
* Please forgive the Genesis reference haphazardly thrown in here, notwithstanding the nod to Elton John in the title.   As to Sir Elton, and with no disrespect to Michael Jackson or Billy Joel, when it's all said and done, I think that the body of work produced by the piano man named Reggie Dwight may well rank with anyone's in the pop/rock genre.   (And, just for the "record", I mean to include Bernie Taupin here. It amazes me that Elton John is not the writer of the lyrics that he so effortlessly sings, and that so much of what he has sung through the years are Bernie Taupin's words.)

** Sorta reminds me of Donovan v. Bierwirth, an oft-cited case making extremely important law, which resulted in no recovery whatsoever to the plaintiffs.

*** One would think that I'd get tired of all the "Sun" puns, but I guess that hasn't happened yet.

**** See the immediately preceding footnote.