Generally, the United States Government is responsible for creating and implementing foreign policy. Foreign policy is not the responsibility of individuals states. Otherwise, rather than being denominated the ”United States of America” we might as well be called the “Individual States of America.” Most states of the Union seem to understand this. Florida, however, does not appear to be one of them.
The idea that it is the Federal Government which creates foreign policy stems from a portion of the Constitution many people do not know about called the Supremacy Clause. The Supremacy Clause provides that Federal law shall be the Supreme law of the land and generally preempts state law.
As a matter of Constitutional law, if there is a conflict between a federal law and a state law, courts generally defer to the federal law and override the state law. Florida lawmakers would do very well to remember this simple concept. However, shockingly, Florida legislators routinely seem to ignore this. Additionally, as a political matter, there appears to be general resistance to the idea that the federal government creates the supreme law of the land. These issues have often resulted in court proceedings one of which has a very recent vintage and relates to an issue that is greatly controversial here in South Florida – – economic trade with Cuba.
Odebrecht v. the Florida Department of Transportation, the United States Court of Appeals for the Eleventh Circuit was called upon to review the constitutionality of a law referred to as the “Cuba Amendment” enacted by the State of Florida and signed into law by Governor Rick Scott. Generally speaking, the Cuba Amendment was created in order to prevent any company that does business in Cuba, or does business with a company that does business in Cuba, from bidding on public contracts in the State of Florida. Odebrecht, a construction company, historically did substantial business with the State of Florida. Odebrecht itself did not do business with Cuba. However, one of its parent companies, based in Brazil, did. This created a problem for Odebrecht insofar as this created a potential violation of Florida’s Cuba Amendment.
Odebrecht filed a lawsuit against the State of Florida seeking a preliminary injunction to prevent the enforcement of the Cuba Amendment. The United States District Court granted the injunction and the Eleventh circuit, on appeal, affirmed the injunction. In order to prevail on the injunction, Odebrecht had to satisfy the four-part test required for a preliminary injunction: (i) a substantial likelihood of success on the merits of the underlying case; (ii) that the moving party would suffer irreparable injury in the absence of the requested injunction; (iii) the harm suffered by the moving party would outweigh the harm suffered by the non-– moving party in the absence of the injunction; and (iv) the deciding to uphold the injunction granted by the District Court , Eleventh Circuit on appeal relied upon the Supremacy Clause of the United States Constitution. Under this clause, the United States Congress has the ability to “preempt” state law. Preemption generally occurs when state law actually conflicts with federal law.
The ultimate question decided by the Eleventh Circuit was the question of whether the Cuba Amendment created an obstacle to the enforcement of a well calibrated foreign policy as that policy relates to Cuba. The Court began its analysis by noting that there are many federal statutes already on the books which relate to United States economic policy towards Cuba. As most readers are aware, United States trade with Cuba is the subject of an embargo. The President of the United States, by executive order, has the right under Federal law to limit the ability of American citizens to trade with Cuba. Nonetheless, the regulations currently in place do not prevent a parent or subsidiary corporation located outside of the country from trading with Cuba. Thus, the Court found that there was a conflict in between the Cuba Amendment and federal law. Moreover, while federal regulation generally restrict trade with Cuba, Federal statutes and regulations generally permit certain exceptions which were not permitted by the so-called Cuba amendment. Accordingly, the Cuba Amendment was found to conflict with the federal statute.
The Eleventh Circuit found that the Cuba amendment conflicted with federal statutes in at least three ways: (i) the Cuba Amendment punishes companies for doing business with Cuba in ways that would otherwise be permitted under federal law; (ii) the Cuba Amendment has its own penalty provisions which are more extensive and severe than those in the federal statute; and (iii) the Cuba amendment undermines the President’s ability to regulate trade with Cuba. As a result, the Eleventh Circuit found that Odebrecht satisfied the requirements for a preliminary injunction and enjoined the enforcement of the Cuba Amendment.
In short, the case is a victory for the United States Constitution and the concept that the states are “United” and not able to enact statutes which conflict with federal statutes. While there are many areas left to be regulated by the states, foreign policy towards nations outside of the United States borders is not one of them and the Eleventh Circuit was correct in its decision to uphold an injunction enjoining the enforcement of the Cuba Amendment by the State of Florida.
For further information see and please read the actual opinion: http://www.ca11.uscourts.gov/opinions/ops/201213958.pdf.
Virtually every morning now, in my email inbox, is a letter from a person that I do not know inquiring as to whether I will represent them. Sometimes the emails seem plainly bogus; other times, it is not so obvious. It is astonishing that there are numerous hucksters trolling the internet whose purpose appears to be to scam lawyers. One would think that lawyers would be one of the least likely targets for this type of activity. However, if you are a lawyer, you should think again – - you have become a target of internet scammers. Let me give you an example of correspondence I recently received which I determined to be bogus:
I wish to file a contempt Petition against my ex-spouse for failure to make court ordered payments in child support, spousal support, equitable distribution and medical support. Please advise if you handle such a case.
Most often these letters/emails will come from people who claim to be in China or Japan with return addresses reflecting same. The letters will explain that, because of the time difference, it would be difficult to contact them by phone and, as a result, the sender would prefer to communicate by email. Often the letters come accompanied with a teaser with respect to the amount owed and offering a contingent fee for collection of sums in excess of $1,000,000. A common theme is the caveat that the case is close to being settled and all the sender really needs is a lawyer to send a demand letter . Naturally, the lawyer will be entitled to a substantial fee for handling the file. One rule of thumb to follow in law and in life – if something seems too good to be true, it generally is.
More often than not, these unsolicited emails are a scam the purpose of which is to defraud the lawyer out of substantial sums of money. While there are several variations of this scam, there are several characteristics common to most of them. First, the lawyer signs and sends an engagement letter to the author of the email and requests a retainer. Almost always the prospective “client” will sign the letter but not send the funds. Before the ink on the retainer agreement is dry, a check will arrive in the lawyer’s office from the prospective defendant made payable to the law firm’s trust account usually for a substantial sum to “settle” the case which has obviously not yet been filed. My advice is to recognize these scams for what they are and, whatever you do, don’t deposit the check.
There are myriad reasons not to deposit the check. First, some banks will spot a bogus check immediately; others will not. Bankers are people too and can be easily fooled. There are several cases in which a bogus check is deposited into a law firm trust account and the bank has actually verified that the check is supported by collectible funds. In at least one instance that I am aware of, the bank has wired transferred the “settlement funds” to the alleged “plaintiff” who is actually the scammer. When the bank realizes that the check is no good they often contact the lawyer seeking reimbursement. There may be insurance coverage to cover a lawyer for this type of scam but the best practice is to avoid it altogether. See http://www.insidecounsel.com/2013/03/21/law-firm-that-was-victimized-by-check-scam-is-enti?t=litigation&page=2.
There are more artful ways of running the same scam using phony wire transfers and things of that nature but the point is the same. The scammer gets the money, the lawyer gets stuck holding the bag.
If you receive these emails on a daily basis, as I do, you have to ask yourself the question of whether you are obligated to respond to them. My answer is yes. The problem with these emails is that the one time that you fail to respond will be the time that the prospective client will be real and claim that you were actually his or her lawyer and that you failed to timely respond. Then there is the possibility that this person will file a Bar complaint against you. Accordingly, the emails discussed above create a special problem.
Generally, it is easier than you think to form an attorney-client relationship. In fact, you can form an attorney-client relationship with practically anyone even in the absence of a retainer agreement or retainer funds. If you sit in a bar with a friend discussing a legal matter, and you dispense legal advice during the course of the conversation, your friend may be able to come back and claim that you were his or her lawyer. No engagement letter or exchange of funds are required. Thus, when you receive a solicitation email like the one referenced above, it is in your interest to respond and advise that either you do not handle such cases or you do not accept solicitations from clients who are not referred by known sources. Keep a record of your responses in case the internet scammer turns out to be real.
If you find a lead that comes through email to be genuine, do some due diligence on it. For example, insist on a telephone call. Make efforts to verify the existence of the company through public data bases or on Google. Confirm the existence of an alleged debt with opposing party and, most of all, be careful with your trust account because that is where the problem will likely arise.
For a time, I was beginning to believe that I was the most popular American lawyer in Japan since a different Japanese woman appeared to be emailing me each and every morning requesting my services in order to recover sums from delinquent ex-husbands. Where do they get my name? I have really no idea but I suspect that it comes, in part, from this blog or our firm’s website.
Some Florida lawyer will be taken in by this scam this year. You should just make sure that you make every effort to ensure that it is not you.
WHY INTERNATIONAL BUSINESS CONTRACTS SHOULD CONTAIN PROVISIONS REQUIRING THE APPLICATION OF UNITED STATES LAW
More than two hundred years after its birth, the United States of America is still a magnet for immigrants. All over Europe and Asia, people still wish to immigrate here to obtain the best possible education, the greatest business opportunities and to succeed. The other reason is that the United States Constitution is, in reality, only second to the Tenth Commandments as one of the greatest sets of legal regulations ever created. Even though the Constitution can be vague in places, the framework it sets out has established a legal system in the United States that is second to none. The legal systems of foreign countries which which do not have the protections of our Constitution often involve laws which would shock many Americans. Here are some good reasons to stipulate in your business contracts to the laws of one of the states of the United States.
1. Service of Process.
In the United States, service of process is accomplished by a process server who is generally required to hand you the paper reflecting a lawsuit. Sometimes there is a possibility for posting the process on your door, or handing it to a relative who lives with you. However, it is the rare circumstance that process can simply be accomplished by publication without prior efforts to effectuate service. Nonetheless, service by publication, and posting outside of the courthouse is often the norm in foreign countries. Imagine if the only way that you could learn about a potential lawsuit is if you are lucky enough to be walking past the courthouse and see your name on the bulletin board. To Americans, this may seem ridiculous but it is, in fact, reality in many countries.
In many countries, whether the Court can obtain jurisdiction can be based on citizenship. Here, in the United States, jurisdiction is most often based upon “minimum contacts” – - the idea that you must have some connection to the forum state before you are sued there. There is a stark contrast between countries who apply jurisdiction based upon citizenship than the United States in which it is based upon “minimum contacts.” In sum, for countries that apply a citizenship analysis, there is no reason for there to be minimum contacts. In fact, it doesn’t matter whether the individual and/or corporation has been present in that particular jurisdiction for many years since citizenship is the test. This leads to the anomalous result that two citizens of a foreign country, living in the United States, who have a child can make that child subject to jurisdiction of a foreign country even when the child has never even been to that country ! To American lawyers, this may seem silly but it is, in fact, the norm in many countries.
3. Ex Parte Hearings.
Most of the time, in the United States, the law requires that both sides be present at a hearing. Not so in other countries. In certain foreign countries there is ample opportunity for one side to approach the Judge alone. This is often done informally in the courthouse or even on the street. What may seem preposterous to Americans, can be routine in other countries.
4. Access to Court Files.
In the United States, anyone can pull up an internet website and search court files. Sometimes, files are protected for privacy reasons, particularly in family law cases. However, most of the litigation in the United States Federal courts is available for review by anyone. Do you think that this is the case in every country in the world? It is not. In many countries, the court file is not open to a review by anyone. In fact, if you wish to inspect the court file, often you must file a motion with the court which has the discretion to deny you access. So much for free speech!
In the United States, in the typical lawsuit both parties are allowed to discover facts about the other party’s case. That is often done with depositions, interrogatories and document requests. Parties are required to produce documents and show them to the other side prior to trial. You would think that this practice would be routine. This is not the case either. In fact, in many countries there is no such thing as discovery. There are countries in which the Judge conducts discovery if there is discovery conducted at all. And, guess what? If the Judge is conducting the discovery, there is no opportunity to complain about it. You just have to presume that the Judge conducted adequate discovery procedures and that the information that the Judge discovered was accurate. There is no such thing as a “Motion to Compel.”
6. Restrictions on Speech.
In some countries, you are not allowed to mention the names of your clients or witnesses. Thus, at a deposition or similar proceeding it is entirely permissible for the witness to decline to answer certain questions on the grounds of “privacy.” There is simply no way to get around this and the person being questioned may, in certain instances, be subject to criminal penalties. Imagine being subject to criminal penalties for saying the wrong thing! This is a concept that is totally foreign to Americans.
Companies which do business abroad would be well-advised to include provisions in their agreements which provide for the application of American law and jurisdiction in the United States. Otherwise, there is a possibility that the company could be subject to jurisdiction in a foreign country, with foreign laws, which do not contain the familiar concepts of the United States Constitution.
 The actual state chosen is dependent upon the type of contracts and the lawyers involved.
Does anybody owe you money? I thought that might get your attention. Both law firms and the clients we represent are living in an age in which collecting money has become unreasonably difficult. This article provides some suggestions as to how best to approach collections from both a practical and legal standpoint.
1. Make Sure you Have a Signed Contract With Your Customer.
Whatever type of business you are in, whether you are an attorney or you sell widgets, it is always best to have a written contract with your client or customer. The contract should spell out in detail the nature of your services and how you will be compensated. The contract should provide a deadline for the client and/or customer to object to the invoices rendered and, if no objection is made, the objection is considered waived. The contract should also contain a provision for attorneys’ fees in the event the filing of a lawsuit is necessary together with jurisdiction and venue provisions. The execution of a written contract is the first step in ensuring that you will be paid. Contact your lawyer to prepare the contract; don’t pull one off the internet and do it yourself !
2. Get a Personal Guaranty.
Personal guarantees are often overlooked, particularly at the commencement of a business relationship. Let’s face it, do you really know whether a prospective client’s corporation is solvent ? Do you really know whether the company has a track record of profits or losses and whether the company owes money to creditors ? Most often, you do not, particularly with small businesses for whom public information may not be readily available. Thus, it is often a good idea to politely request a personal guaranty. This will make your life easier later on when you have to sue the company, which is then out of business, and your only hope to be paid is to collect from the company’s principal. Cases in which a personal guaranty has been executed are completely different than those where there are no such guarantees. The likelihood of settling a case in which you obtained a personal guaranty is far greater because of the risk of personal liability that the principal of the corporation will have.
3. Send a Demand Letter
No one likes to be sued. Even worse, no one likes to be sued out of the blue. Accordingly, it is often a good idea to send a demand letter to the prospective defendant first. The demand letter should contain the required statement by the Fair Debt Collection Practices Act which should include the following:
In the event that you do not receive a response, call your lawyer. See paragraph 5 below. Do not send demand letters threatening suit if you do not intend to follow through. You do not want to acquire the reputation of a bluffer.
4. Monitor Accounts Receivable and Work In Process.
In the world in which we are living, it is likely that the debtor you are thinking of suing is being pursued by other creditors. It is also likely that the debtor has a limited amount of assets. Thus, it is in your best interest to be aggressive in collecting money that is owed. How do you that ? Here are some suggestions.
Monitor your accounts receivable. This means looking at the amounts you are owed on a regular basis, usually every week or so. It is not a good idea to wait until several months go by before you realize that someone, or some company, owes you a lot of money.
Also, be aware of goods in transit and work in process. These are the two accounting categories which reflect what you, or your company, are currently working on. Generally, it is not a good idea to continue to ship goods or to provide services to someone who is not paying. If you do, you are only making matters worse as you get further and further behind. Moreover, it is often interesting to see a company’s reaction when the promised goods are not delivered or the services are not performed ? Very often the check will arrive in the mail because the customer needs the product or the service. This is often a good time to collect money.
5. Call the Lawyer
When all else fails, call the lawyer. Hopefully, you have taken the advice in this column and made your customer sign a contract and you have obtained a personal guaranty. This will make the lawyer’s job far easier if you are required to file a lawsuit.
There are many people in the world who purchase goods and services knowing in advance that they will not pay for them. It is often hard to spot these people in advance; nonetheless, rest assured, they are out there. Try not to let them get away with it. Moreover, there are also people who have genuinely fallen on hard times and require more time to pay and honestly tell you that. These are people who you should work with towards obtaining an amicable resolution. Generally, people in the latter category are worth continuing to do business with while people in the former category are not. The trick is to be able to tell, to extent possible in advance, who is who.
HOW A SIMPLE DISCLOSURE MIGHT PREVENT YOUR BUSINESS FROM BEING SUED FOR “UNFAIR” AND “DECEPTIVE” TRADE PRACTICES
Two lawyers in New York recently had the bright idea of suing the Metropolitan Museum of Art. That’s right, they sued the Met, that sprawling bastion of culture that dominates the landscape of Manhattan’s upper east side. Their claim — the Met had engaged in “unfair and deceptive trade practices” because it failed to adequately inform its patrons, in a printed sign, that the twenty-five dollar ($25) admission price was a “suggested donation” rather than an actual fee. These lawyers have sought class action status on behalf of two tourists who paid the fee because the tourists thought the fee was mandatory when, in fact, the fee was merely a suggested donation.
This raises several important legal and moral questions. What does it mean to be unfair and deceptive and under what circumstances should litigation be commenced. Many states have specific statutes which prohibit businesses from engaging in unfair and deceptive trade practices. As a matter of illustration, the statute has often been applied to automobile dealerships which charge extra fees to consumer contracts without really explaining what the fees are designed to cover or, worse, misleading the public into believing that the fees are designed to compensate the dealership for an out of pocket cost when, in fact, there is no such cost. Nonetheless, there are several things that businesses can do to avoid being sued for the violation of the unfair and deceptive trade practices act.
1. Tell the Truth
For some businesses or individuals, this can be hard. Salesmanship, many business owners will tell you, involves some element of puffery — the art of inflating the value of a particular good or service during the sales process. Let the business owner beware – there is a difference between salesmanship and fraud and both lawyers and judges sometimes have difficulty drawing it. If the Courts are having difficulty adequately defining it, isn’t this something that will likely be hard for business owners to define ? You bet. The remedy- just tell the truth.
2. Disclose Otherwise Hidden Profit Centers
American business owners are entitled to make a profit. This is the American way. Nonetheless, there a host of things which may not be readily apparent to a consumer that such a thing could actually be a profit center. When consumers discover that a business is profiting in an unexpected and undisclosed way, this tends to make the average person feel taken advantage of. This feeling often leads to a call to the lawyer who often files suit sometimes seeking class action status. Lawyers seeks class action status because it gives them the potential to sue on behalf of many people, not just one and, as a result they can make more money.
What are hidden profit centers ? You own a furniture store. You charge for delivery of the product to the consumer. However, in order to deliver the product, you hire a third party vendor. The third party vendor charges you $500 but you charge $1,000 to the consumer. Do you have to disclose this to the consumer ? You bet you do. Otherwise, when you place on to the consumer’s invoice the phrase: “delivery charge, $1,000” the average person has the right to believe that this is what it costs you. Thus, a phrase such as the following in your invoice to the consumer will, potentially, help to forestall a deceptive and unfair trade practices act claim: “the store reserves its right to make a profit on the delivery charge of goods.” Not to be condescending here, but most consumers don’t read their invoices anyway and even for those who do, it is not unreasonable to believe that certain people might agree that it is perfectly acceptable for a store to take a profit on a delivery charge, provided that it is disclosed.
3. Avoid the Bait and Switch
The bait and switch is simply a variant of item #2 above. It stems from the same adage – tell the truth. In this instance, however, what a business owner might consider is to advertise a product at one price but when the consumer appears at the business to purchase it, based upon the advertisement, the product is suddenly “unavailable.” Instead, there is often a new product there to replace it, most often at a higher price. This is called a “bait and switch” and is generally considered unfair and deceptive under most state law. Advertising disclosures might help prevent this problem such as: “limited quantities available” or “the store reserves its right to substitute products which may cost more than the advertised price.” This tells the consumer – hey, you may not get the product you are coming in to the store for but at least we are telling you in advance. Disclosure, plain and simple.
In sum, telling the truth and disclosing as much as possible in advance will help eliminate a time consuming and expensive lawsuit and, even worse, a potential class action. As for the lawyers in the Metropolitan Museum case – do they have a case ? The answer is probably yes. The problem with their case is, however, that suing a charitable organization because it allegedly misled the public into making a donation lacks cache, mostly because the average person is likely to believe that art patrons should donate to the museum, regardless of whether they were deceived into doing so.
Children are usually abducted from the United States and taken to foreign countries in cases involving divorcing spouses where one of them was either born in or grew up in a foreign country. After all, what better way to seek revenge against your former spouse than to abduct the child to a foreign country ? Depending upon the country involved, it can be a nightmare to obtain the child’s return. Sometimes it takes years; sometimes it doesn’t happen at all.
Now the Second Circuit has ruled that there is a potential remedy to an aggrieved parent under the Hague Convention, an international treaty. Look for this case to ultimately land in the United States Supreme Court based upon a conflict in the federal circuit courts of appeal.
The following synopsis of the case first appeared in the Reuters News Service.
Federal courts can enforce a parent’s right of access to their children under the Hague Convention, an international treaty established in part to help recover children abducted and taken by one parent to another country, an appeals court in New York has ruled.
The ruling by the 2nd U.S. Circuit Court of Appeals differs from a 2006 ruling by the 4th U.S. Circuit Court of Appeals, which placed jurisdiction under the convention with the U.S. State Department.
“The statutory basis for a federal right of action to enforce access rights under the Hague Convention could hardly be clearer,” Circuit Judge Jose Cabranes wrote for the three-judge panel in Monday’s unanimous decision. The panel also included Circuit Judges Pierre Leval and Robert Sack.
The case stems from a custody dispute involving Zeynep Tekiner Ozatlin, who took her two children from Turkey to the United States in 2011. She returned them to their father in Turkey in July 2012 under order from U.S. District Judge Laura Taylor Swain in Manhattan.
Ozatlin appealed to the 2nd Circuit. Her case rested in part on the argument that federal district courts do not have jurisdiction under the International Child Abduction Remedies Act, a U.S. law created in 1988.
That U.S. law was drafted to implement the Hague Convention on the Civil Aspects of International Child Abduction, a multilateral treaty created in 1980 “to protect children from the harmful abduction or retention across international boundaries by providing a procedure to bring about their prompt return,” according to the website for the Hague Conference on Private International Law. Eighty-nine states have signed the International Child Abduction treaty, according to its website.
Ozatlin contended that petitioners seeking to enforce “rights of access” need to go through state courts or the State Department, which is the United States’ designated “Central Authority” under the Hague Convention. “Rights of access” include the right “to take a child for a limited period of time to a place other than the child’s habitual residence,” according to the treaty.
Ozatlin’s argument, Cabranes wrote, “is not jurisdictional in nature” but instead goes to whether the International Child Abduction Remedies Act creates a federal right of action.
RIGHTS OF ACCESS
In the 2006 decision, Cantor v. Cohen, the 4th Circuit ruled that it did not. But it misinterpreted an article in the Hague Convention on which its decision heavily relied, Article 21, as saying that access rights can only be vindicated by applying to the State Department, Cabranes wrote.
The article “provides that efforts to secure rights of access ‘may’ be initiated through an application to a country’s Central Authority, not that it ‘may only’ be pursued in this way,” Cabranes wrote.
The Hague Convention also explicitly states elsewhere that petitioners can seek to enforce access rights through “judicial or administrative authorities of a Contracting State, whether or not under the provision of this Convention,” Cabranes wrote, quoting from the treaty.
Cabranes also said that the 2nd Circuit’s decision was bolstered by the fact that the State Department has no administrative apparatus to enforce rights of access.
”In sum, even though not required under Article 21, federal law in the United States provides an avenue for aggrieved parties to seek judicial relief directly in a federal district court or an appropriate state court,” Cabranes wrote.
The 2nd Circuit’s opinion affirms Swain’s order to return the children to the father. The man, Nurettin Ozatlin, “met his burden of showing that he retained custody rights under Turkish law, and that the Mother’s removal of the children from Turkey interfered with his exercise of those rights,” Cabranes wrote.
The 2nd Circuit did vacate Swain’s award of necessary expenses incurred from the case to the father and remanded it for further proceedings.
The appeals court reasoned that the mother had a “reasonable basis for removing the children to the United States” because Turkish courts had repeatedly implied that the children could live with her in the United States.
The case is Nurettin Ozaltin v. Zeynep Tekiner Ozatlin, 2nd Circuit Court of Appeals, No. 12-2371.