Indiana Employers Earn New Wage Claim Defense

by Kristopher N. Kazmierczak
Katz Korin P.C.
334 N. Senate Avenue
Indianapolis, Indiana 46204

As of July 1, 2015, Indiana employers are no longer automatically liable for paying liquidated damages as a penalty for overdue wages under Indiana law. [1] Indiana law previously mandated that an employer must pay a maximum of double the amount of unpaid wages as a penalty for unlawfully withheld wages, without exception. [2] Before the revision, courts had no discretion to deny an award of liquidated damages in connection with meritorious wage claims. [3]

A monumental shift in Indiana’s wage statute took effect on July 1, 2015 when, for the first time in over a century, the Indiana General Assembly authorized courts to use their discretion when considering an award of liquidated damages for overdue wages. [4] Following the change in the law, an award of liquidated damages can only be imposed after the court is convinced that the employer was not acting in “good faith” when it failed to timely pay wages. [5] Although this significant change was presumably intended to avoid unfair results for honest mistakes by employers, it will likely cause more uncertainty and indecision for employers, employees, and the courts when assessing potential liability for liquidated damages. Additionally, the change will likely lead to more uncertainty over responsibility for liquidated damages and litigation over past due wages. (more…)

A Roadmap for Business and Social Movement Collaboration

by Kelly R. Eskew, J.D.
Clinical Associate Professor
Department of Business Law & Ethics
Kelley School of Business, Indiana University
1309 East Tenth Street
Bloomington, IN 47405

This year, the Indiana General Assembly offered up Senate Bill 101 (the Religious Freedom Restoration Act or “RFRA”), [1] a law ostensibly intended to protect Hoosiers from having to violate their religious principles, but widely viewed as a discriminatory response to the Seventh Circuit’s ruling in 2014 that struck down the state’s prohibition on same-sex marriage. [2]. RFRA raced through the Republican supermajority legislature and was quickly made law by Governor Mike Pence, one of the nation’s most conservative governors. [3]. But soon after, Pence signed an amendment that not only affirmed the rights of gays and lesbians, but also those who face discrimination on the basis of gender identity. [4].

Business and grassroots advocacy leaders collaborated to try to defeat RFRA. [5]. None expected to succeed, [6] but what they achieved surprised everyone – and this collaboration is not an outlier. Businesses worked with social justice advocates on marriage equality, which is now the law throughout the country. [7]. In fact, businesses often engage in such initiatives. [8]. Businesses have corporate social responsibility (“CSR”) programs of varying complexity that not only make charitable donations through their foundations, but also pioneer environmental projects and work to strength communities and schools. [9]. CSR is also part of the syllabus in business ethics classes, which many business schools now require students to take. [10]. In other words, social responsibility has moved from fad to policy. Businesses are also creating their own social movements that mirror the principles shared by grassroots advocates in areas such as poverty eradication, health-care access, and sustainability. [11].

So when and why does the American business community align itself with grassroots social movements? And is there a roadmap that shows each how to leverage the other to achieve shared goals? A fully fleshed response to these questions is beyond the scope of this post, but the RFRA experience suggests some answers. (more…)

Congratulations to the Vol. 49 Note Candidates!

The Indiana Law Review is pleased to announce that the following students have been selected as Note Candidates for Volume 49. We look forward to their contributions to legal scholarship over the coming school year. Congratulations!

Melody Bledsoe

Samuel Blink

Chris Bloomer

Alexander Carlisle

Eric Coleman

Kristina Coleman

Rebecca Critser

John DeRoss Jr.

Amy Dunn

Justine Farris

Christina Fisher

Kristina Frey

Scott Frissell

Tabatha Halleck

Ryan Heeb

Betsy Huffman

Benjamin Jaqua

Justin Jones

Tyler Jones

Robert Miller

Kyle Montrose

Tyler Moorhead

Kasey Polk

Caroline Ryker

Alexander Swider

Ariana Tanoos

Megan Thobe

Company Records – An Unsexy Tool for Disputes Within Closely-Held Entities

by Hannah Kaufman Joseph & B.J. Brinkerhoff
Katz Korin P.C.
334 N. Senate Avenue
Indianapolis, Indiana 46204

Everyone knows that corporations and limited liability companies (“LLCs”) are governed by statutory requirements that outline how such entities must organize and govern themselves, and subsequently record those activities. [1]. Oftentimes, the focus on these statutory requirements centers on whether a company has properly maintained itself as an independent organization entitled to limited liability protection from creditors, thereby insulating the owners, members, and/or shareholders from claims. [2]. Thus, the applicable statutes serve as an important benchmark to determine whether a corporation or LLC has properly observed “corporate formalities.” If the organization generally complies with the statute’s specifications for the filing and upkeep of corporate records (and does not engage in behavior that would allow creditors to pierce the corporate veil), the protection afforded a company by its jurisdiction of domicile will hold tight against third parties. [3]. But statutes that apply to formal business entities serve an often-disregarded, yet critical second purpose: to set forth the rights and duties the owners owe one another and the company. [4].

Simultaneous Death and the Indiana Wrongful Death Statute: Resolving the Ambiguities of the Statute when the Order of Death is Ambiguous

by Jon Noyes (Attorney Profile)
Wilson Kehoe Winingham LLC
2859 N. Meridian St.
Indianapolis, IN 46208
(317) 920-6400

[Editor’s Note: This is the second article Jon Noyes has written for the Indiana Law Review Blog. You can find his first article here.]

Indiana’s adult wrongful death statutes group individuals into two categories:  (1) adults who were married, or possessed dependent next of kin, or both; [1] and (2) adults who were not married and possessed no dependent next of kin. [2].  Which category the decedent falls into determines the measure of damages available. [3].

Under normal circumstances, this does not present a substantial obstacle.  It is usually easy to determine whether or not the decedent was married or possessed dependent next of kin.  This can be as simple as looking at the decedent’s death certificate.  However, what if it is impossible to determine whether the decedent possessed a spouse or dependents at the time of his or her death?  For example, how would a married couple be categorized if they had no dependents and died in a manner that left it impossible to determine who predeceased who?  Can the plaintiff show that the decedent meets the requirement of either?

The answer is no.  As discussed below, if two individuals that would normally be considered adults that were married expire simultaneously or in a manner that makes it impossible to determine who predeceased who, the plain language of the Wrongful Death Statute seems to indicate that it would be impossible to determine which measure of damages apply.  However, under principles of equity, the personal representatives of the decedents should be able to recover damages as if both individuals left surviving spouses. (more…)

The Dreaded Pre-Tender Issue: Indiana Courts Should Reconsider Whether Pre-tender Costs are Recoverable

by Ryan T. Leagre (Attorney Profile) [i]
Plews Shadley Racher & Braun LLP
1346 N. Delaware St.
Indianapolis, IN 46202-2415
(317) 637-0700

The ability of a policyholder to recover pre-tender costs is an evolving area of insurance coverage law. In Dreaded, Inc. v. St. Paul Guardian Insurance Company, the Indiana Supreme Court held that, under the facts of that case, a policyholder could not recover the legal expenses it incurred defending itself from a claim asserted by the Indiana Department of Environmental Management (“IDEM”) prior to giving notice of or tendering the claim to its insurer. [1]. And while Dreaded was limited to the facts of that case, the Indiana Court of Appeals in Travelers Insurance Company v. Maplehurst Farms, Inc. interpreted Dreaded to mean that pre-tender costs are simply not recoverable. [2]. The courts’ decisions in Dreaded and Maplehurst rested, in part, on two grounds: (1) an insurer’s duty to defend its policyholder does not arise until the policyholder provides notice of the claim; [3] and (2) the insurance policy provision requiring a policyholder to give notice of a claim to the insurer is a condition precedent to coverage. [4].

Indiana courts should reconsider the holdings in Dreaded and Maplehurst. [5]. These holdings result in the forfeiture of coverage, which is unfair and disfavored under Indiana law, [6] and ignore the realities of long-tail environmental claims. [7]. To begin, Dreaded’s explanation of the duty to defend is incomplete. An insurer’s duty to defend its policyholder is not triggered by notice of the claim, but rather by the existence of a potentially covered claim. [8](more…)

How Corporate Transactions Can Make Liability Insurance Coverage Disappear

by Lara Langeneckert
Deputy Solicitor General
Office of the Indiana Attorney General

Imagine you are a successful widget manufacturer, and you have just expanded your business by purchasing another widget company called Acme. In the sale, you received all of Acme’s corporate assets, including its commercial general liability (“CGL”) insurance policy [1] from Flanders Insurance. You are all set to begin producing more widgets than ever before when a lawsuit stops you in your tracks: Apparently, the day before you bought Acme, an Acme widget exploded and injured three people. Those people are now suing you, Acme’s successor-in-interest, to recover for their personal injuries.

A bad situation, to be sure, but you’re not too worried. After all, you have Acme’s CGL policy, so Flanders has to defend and indemnify you against this lawsuit, right? To give a classic lawyer answer: it depends [2]—mostly upon what jurisdiction you happen to be in. And if you are in Indiana, you are probably out of luck. This Article discusses the development of the law in this area, with a specific focus on Indiana. Specifically, this Article addresses two ways corporate policyholders can protect themselves both before and after a sale. (more…)

Testimony of Professor of Law Robert Katz on Indiana RFRA

by Robert A. Katz
Professor of Law (Faculty Profile)
Indiana University Robert H. McKinney School of Law
Lawrence W. Inlow Hall, Room 349
530 W. New York Street
Indianapolis, IN 46202-3225

[Editor’s Note: This article departs from the typical format and citation style of the Indiana Law Review Blog in the interest of providing commentary on the passage of Senate Bill 101, commonly referred to as the “Religious Freedom Restoration Act,” or RFRA. This article consists of abbreviated remarks presented by the author to the House Judiciary Committee of the Indiana General Assembly on March 16, 2015, 10 days before the bill was signed into law by Indiana Governor Mike Pence.]

Good day. My name is Robert Katz. I am a professor of law at Indiana University Robert H. McKinney School of Law where I teach First Amendment law and law and religion. My research focuses on the tension between religious freedom and anti-discrimination law. It is one of my most profound concerns as a citizen, a parent, and a member of the Jewish community.

The freedom of religion is one of our most fundamental rights as Americans. Yet, also precious to us as citizens are our civil rights and, most relevantly here, our right to be free from discrimination.

As I understand it, this bill has two main goals. (more…)

Separating Myths from Reality: Four Arguments for Raising the Minimum Wage

by Fran Quigley
Clinical Professor of Law (Faculty Profile)
Health and Human Rights Clinic
Indiana University Robert H. McKinney School of Law
Lawrence W. Inlow Hall, Room 111N
530 W. New York Street
Indianapolis, IN 46202-3225

Proposals to raise the U.S. minimum wage have attracted a great deal of attention in the last several years.  At the federal level, President Obama and many members of Congress have expressed support, via the Fair Minimum Wage Act, for an increase in the U.S. minimum wage. [1]. The legislation calls for an increase to $10.10 per hour for most workers, compared to the current minimum of $7.25 per hour. [2].  The bill also would increase the bottom level of pay for tipped workers from $2.13 per hour to 70% of the hourly worker minimum, and index both hourly and tipped worker wage levels for inflation. [3].

The federal bill has not passed, but twenty-nine states and the District of Columbia have all raised their minimum wage above the federal level. [4].  At least 140 individual communities have passed living wage ordinances, which raise salaries above the federal or state minimums. [5].  Bills proposing an increase in Indiana’s minimum wage, currently set to mirror the federal level, [6] failed to get a hearing in the 2015 session of the Indiana General Assembly. [7].

The minimum wage debate has often been characterized by misstatements of facts and forecasts that are not supported by evidence.  In an effort to separate the myths from the reality, here are four arguments for raising the minimum wage: (more…)

Myths and Realities of GMO Labeling Initiatives

by Drake T. Land
J.D. Candidate, 2015, Indiana University Robert H. McKinney School of Law
Indiana International & Comparative Law Review: Executive Articles Development Editor
B.S., 2007, Ball State University; Muncie, Indiana
Twitter (@draketland)

Editor’s note: Mr. Land’s article was selected from submissions in the Indiana Law Review‘s first writing competition.

Following the introduction of Genetically Modified Organisms (“GMOs”) into the food market in 1994, [1] consumer groups and multiple legislative bodies have fought to restrict their sale and label GMOs differently than traditionally developed foods. [2].  This push to restrict the sale, or label, of GMOs is born of the fear that GMOs will have unforeseen consequences to human health and/or the environment. [3].  These fears have been shown to be unrealized after twenty years of market availability [4] and, although restrictions on the sale of GMOs and mandatory labeling is the law in most European countries, [5] labeling initiatives have not achieved the same success in the United States’ federal and state governments. [6].  The European Union “has probably the strictest GMO regulations in the world though these derive rather from political considerations, rather than being based upon scientific principles.” [7].  Unlike the European Union (“the EU”), the United States Constitution explicitly “promote[s] the progress of science,” [8] and under this framework the United States has provided more protection to the development and retail of GMOs.

All currently grown crops have been developed through genetic modification. [9].  “By selectively breeding plants and animals with the most desirable traits, our predecessors transformed organisms’ genomes, turning a scraggly grass into plump-kerneled corn, for example.” [10].  Following Mendel’s discovery of the inheritance of genetic traits, farmers and scientists alike have been using selective breeding and hybridization to alter food crops to make them more reliable and marketable. [11].  “Today, there are virtually no food products in supermarkets that have not been improved in some manner by selective breeding.” [12]. (more…)