New York Assembly Passes Bill to Fill Void as NLRB Lacks Quorum, Raising Preemption Concerns
As we previously reported here, since May 22, 2025, the National Labor Relations Board (“NLRB” or “Board”) has lacked a quorum of at least three members after the U.S. Supreme Court stayed the reinstatement of former Board Member Gwynne A. Wilcox following her firing by President Trump. As a result, the NLRB cannot issue decisions in representation and unfair labor practice cases. The Board has also been faced with constitutional challenges to its regime. (See here and here.)
To attempt to fill this void, on June 17, 2025, the New York State Assembly overwhelmingly passed legislation—referred to by the co-sponsors as the “NLRB Trigger Bill”—that would amend the New York Labor Relations Act to expand the jurisdiction of the Public Employment Relations Board (“PERB”) to essentially step into the role of the National Labor Relations Board (“NLRB” or “Board”) for private-sector employers.
Currently, PERB only oversees public-sector employees and private-sector employees that the NLRA (or the federal Railway Labor Act) do not cover, such as agricultural workers.
If signed into law by Governor Hochul, the NLRB Trigger Bill would permit PERB to act in the following ways if the NLRB does not “successfully assert” jurisdiction:
Representation Elections: To certify—upon application and verification—“any bargaining unit previously certified by another state or federal agency.” The plain text of the bill appears to indicate that PERB’s authority would apply only to bargaining units “previously certified” by the NLRB or another state—meaning it could not process representation petitions for new units that have not been certified.
Adjudicating Unfair Labor Practices / Improper Practices: To exercise jurisdiction over any previously-negotiated collective bargaining agreements and ensure those employment terms remain in full force and effect. Similar to the NLRB, PERB adjudicates unfair labor practices by investigating charges and prosecuting those charges before administrative law judges, and then PERB itself.
Under this bill, PERB’s jurisdiction would not apply where the NLRB “successfully asserts jurisdiction” over employees or employers pursuant to an order issued by an Article III federal court. In other words, if / when the NLRB retains a quorum and asserts jurisdiction, then PERB’s jurisdiction would cease.
Potential Preemption Challenges
If this bill become law, then employers likely will challenge it as preempted under the NLRA based on the Supreme Court’s landmark decision in San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236 (1959). In Garmon, the Court held that where there is even the potential for conflict between the NLRA and state or local law, then such state/local law is preempted. The Court in Garmon reasoned that the purpose of a broad preemption doctrine was to ensure a uniform national labor relations policy overseen by the NLRB—not a patchwork of state and local laws.
California and Massachusetts are considering analogous legislation, and we will closely monitor the progress of these bills, as well as any potential challenges that surface.
An Oft-Overlooked Requirement in the N.Y. Commercial Division Rules: The Rule 11-e(d) Statement of Completion
Effective April 1, 2015, the Commercial Division of the New York State Supreme Court promulgated a series of reforms to the Rules of Practice for the Commercial Division, including the addition of new Rule 11-e, which provides specific requirements for responding and objecting to document requests.
In particular, Rule 11-e(a)-(b) requires parties to provide particularized responses and specify in detail whether documents are being withheld in response to all or part of the requests, and Rule 11-e(c) requires a date for the completion of document production prior to depositions. These are markedly different than those required by the Uniform Civil Rules that govern non-Commercial New York State Supreme Courts and County Courts, and have been the subject of much discussion by courts and practitioners in the ensuing years. However, one significant requirement of Rule 11-e that is often overlooked concerns Rule 11-e(d).
In particular, Rule 11-e(d) provides as follows:
(d) [b]y agreement of the parties to a date no later than one (1) month prior to the close of fact discovery, or at such time set by the Court, the responding party shall state, for each individual request: (i) whether the production of documents in its possession, custody or control and that are responsive to the individual request, as propounded or modified, is complete; or (ii) that there are no documents in its possession, custody or control that are responsive to the individual request as propounded or modified.
In other words, in addition to responding and objecting to document requests at the outset with specificity as required by Rule 11-e(a)-(b), one month prior to the close of fact discovery or another date set by a court, parties are further required to issue a statement that specifically denotes for each request whether document production is complete as requested or modified, or that they are not in possession of responsive documents. Such a formal obligation at the conclusion of discovery to specify whether production is complete for each individual request is not found in the Uniform Civil Rules or the Federal Rules of Civil Procedure, and appears to be entirely unique.
Despite this, Rule 11-e(d) seems to have largely gone unaddressed in the last decade with most courts and practitioners focusing instead on the other significant requirements of Rule 11-e. Even so, as recently as 2023, in Men of Steel Enterprises, LLC v. Bespoke Harlem W., LLC, 2023 N.Y. Slip Op. 30404[U] (Sup. Ct. N.Y. Co. 2023), the Honorable Joel M. Cohen ordered plaintiffs to submit amended responses to comply with the requirements of Rule 11-e(d) and did so despite the fact that plaintiffs had already represented in their opposition that they had produced all responsive documents and did not have additional documents in their possession, custody, and control—demonstrating that the Rule is alive and well and may be enforced to the full extent, even if merely as a formality. While it remains unclear how focused courts will be on the requirements of Rule 11-e(d) statements going forward, including their form and use, those practicing in the Commercial Division should be prepared to comply with its requirements.
Five Things Every Health Care Provider Should Know About HHS OIG’s 2025 Semiannual Report
On June 2, 2025, the Department of Health and Human Services (HHS), Office of Inspector General (OIG) published its Semiannual Report to Congress. This report covers the period from October 1, 2024, through March 31, 2025, and highlights the OIG’s key findings and recommendations for the reporting period.
Below are the five critical insights every health care provider should be aware of from the report.
1. Monetary Impact: OIG reported $16.61 billion in total for their work’s monetary impact, including $3.51 billion of the total from investigative receivables, which is money ordered or agreed to be returned to HHS or other governmental entities based on OIG investigations. The findings are evidence of OIG’s active enforcement during the reporting period.
2. Enforcement Actions and Exclusions: The OIG initiated a total of 744 enforcement actions, with a nearly equal distribution between criminal (349) and civil (395) actions. Additionally, over 1,500 individuals were added to the OIG exclusion list, rendering them ineligible to participate in federally funded health care programs. These findings highlight the OIG’s commitment to pursuing criminal and civil resolution of health care matters as well as health care program exclusions.
3. Medicare Advantage Program Oversight: The OIG identified significant issues within the Medicare Advantage risk adjustment program, including $13.6 million in net overpayments to three Medicare Advantage plans due to incorrect diagnosis coding. The evaluation revealed that in-home health risk assessments (HRAs) linked chart reviews generated $4.2 billion of the $7.5 billion in risk-adjustment payments. Consequently, the OIG recommended that the Centers for Medicare & Medicaid Services (CMS) impose additional restrictions on the use of diagnoses reported solely in in-home HRAs, indicating this area will likely be a focus of future OIG compliance monitoring.
4. Improper Payments: OIG found that CMS “made millions of dollars” in improper drug payments, resulting in unnecessary costs to the federal government and taxpayers. According to its report, this included $465 million for drugs covered under Medicare Part A but paid under Part D, $454 million for COVID-19 tests exceeding the monthly limit, and $190 million for outpatient services that were already covered. Given the impact of these payments, claims submitted for these services will likely face higher scrutiny from OIG and CMS in the future.
5. Fraud, Waste and Abuse: OIG evaluated and processed almost 31,000 tips that led to 17,000 referrals including to the Department of Justice and other agencies. During the review period, hotline complaints resulted in expected recoveries totaling $121 million according to the report.
The report demonstrates the OIG’s prioritization of effort to investigate fraud, waste and abuse allegations, and its willingness to seek both civil and criminal resolutions as well as federal health care program exclusion when appropriate. Importantly, the report provides insight into the OIG’s priorities and potential areas for future enforcement.
Employers Modifying Retiree Benefits Provided More Clarity Following SCOTUS Decision (US)
Some employers offer benefits not only to their current employees, but under certain circumstances also offer certain benefits, such as health insurance, to employees who retire from working for them. Employers sometimes modify the terms of benefit policies, programs, and plans for a number of reasons, including to change coverages or eligibility requirements or to adjust contribution rates. Employers looking to make these sorts of changes, or even to discontinue certain retiree benefits, can do so now with more confidence that they won’t violate the Americans with Disabilities Act (ADA) after a recent decision by the United States Supreme Court.
On June 20, 2025, the Court decided in Stanley v. City of Sanford, Florida that retirees, as former employees, are not covered by the ADA’s anti-discrimination provision when applied to receipt of certain post-employment benefits.
The case was brought by Karyn Stanley, a firefighter who worked for a Florida city’s fire department. When she was hired in 1999, the city offered health insurance until age 65 for employees who retired either with 25 years of service and or those employees who retired due to a disability but prior to having 25 years of service. However, a few years later, in 2003, the city changed its retiree health insurance policy to provide health insurance to age 65 only for retirees with 25 years of service. Employees who retired earlier due to disability would receive coverage not until age 65, as previous, but instead only for 24 months post-retirement.
Ms. Stanley retired from the city’s fire department in 2018 after developing Parkinson’s Disease. Because she did not have 25 years of service at the time she retired due to her disability, under the 2003 policy, Ms. Stanley was eligible for only 24 months of retiree health insurance, and not coverage until age 65, as would have been the case under the policy in effect in 1999 when she was hired. Ms. Stanley sued the city, claiming that its 2003 change in policy limiting health insurance coverage for disabled retirees to 24 months from the prior policy in effect at the time of her hire which provided coverage until age 65 for disabled retirees regardless of years of service, discriminated against her on the basis of her disability in violation of the ADA.
Writing for the majority – only Justice Jackson dissented from the essential holding of the case – Justice Gorsuch explained that Ms. Stanley could not maintain her ADA claim against the city because the ADA only permits “qualified individuals” – those who held and could perform the essential functions of a position at the time of the alleged discriminatory act – to bring suit. Because Ms. Stanley was no longer working for the city nor able to perform the essential functions of her position when she sued the city, the Court explained that she was not covered by the ADA’s anti-discrimination provision, the plain language of which protects only current employees from disability-based discrimination. The Court did note, however, that although Ms. Stanley could not bring her ADA claim, other statutes, including the Rehabilitation Act and state law, may afford alternative avenues for relief.
In light of Stanley, those employers who provide retiree benefits now have more clarity that making changes to benefits that may negatively impact disabled retirees will not violate the ADA. But, as noted, that does not mean that such changes will necessarily be entirely lawful, as other laws may provide protection to disabled retirees or otherwise limit what sort of changes an employer can make in retiree benefit policies, programs, and plans.
Democratic Commissioners Reinstated at CPSC – for Now
As legal challenges continue regarding whether the President of the United States can terminate confirmed commissioners at a variety of “independent” agencies without cause, eyes turn to the Consumer Product Safety Commission (CPSC or Commission). In short, after challenging their firing by President Trump in court, the three Democratic CPSC commissioners are now back at their desks. On June 13, 2025, Judge Matthew Maddox of the Maryland District Court ruled that the firing violated federal law and ordered the commissioners’ immediate reinstatement. Siding with the plaintiffs, Judge Maddox held that “President Donald J. Trump’s purported termination of Plaintiffs Mary Boyle, Alexander Hoehn-Saric, and Richard Trumka Jr. from their roles as Commissioners of the Consumer Product Safety Commission … is ultra vires, contrary to law, and without legal effect.”
Having been restored to their positions at the CPSC, Commissioners Boyle, Hoehn-Saric, and Trumka have responded to actions taken by their Republican colleagues, Acting Chair Peter Feldman and Commissioner Douglas Dziak, during their absence. At the outset, they contend that because their firings were invalid, quorum requirements under 15 U.S.C. § 2053(d) were not met, and, therefore, any votes taken since their termination are invalid. For example, a June 17, 2025, “Time Critical Ballot” overturned the May 13, 2025, vote to withdraw a Notice of Proposed Rulemaking proposing a new safety standard for lithium-ion batteries in e-mobility devices, which we wrote about here and here. The three reinstated commissioners also voted to terminate “staff who have been hired, detailed, or otherwise placed at CPSC for the express purpose of carrying out Implementing The President’s ‘Department Of Government Efficiency’ Cost Efficiency Initiative Executive Order without majority approval by the full Commission.” Acting Chair Feldman and Commissioner Dziak abstained.
The Administration promptly appealed the District Court’s decision to the Fourth Circuit and then asked both the Fourth Circuit and the District Court to pause the District Court’s order reinstating the three Democratic commissioners, pending the appeal. Unsurprisingly, the reinstated commissioners opposed the stay request. On June 23, 2025, Judge Maddox denied (Pacer subscription required) the motion before him, while the motion for a stay before the Fourth Circuit is now fully briefed and ripe for a decision.
Both parties cited the May 22, 2025, emergency order issued by the Supreme Court in Trump v. Wilcox in support of their position. In Wilcox, the Supreme Court determined that a stay of a preliminary injunction reinstating terminated federal officers (in that case, involving officials of the National Labor Relations Board) was “appropriate to avoid the disruptive effect of the repeated removal and reinstatement of officers during the pendency of this litigation.” Unlike the preliminary posture of that case, however, the District Court in the present CPSC case issued a permanent injunction reinstating the commissioners. Thus, according to Judge Maddox, the risk of disruption from “repeated removal and reinstatement” is “no longer a factor.” As the dissenting Justices in Wilcox recognized, the emergency order in that case calls into serious doubt the continued validity of a 90-year-old Supreme Court precedent, Humphry’s Executor v. U.S., which generally held that Congress has power to create independent agencies, such as the CPSC, and forbids the Executive to remove independent agency members except for cause.
The central legal question regarding the President’s authority under the Constitution to terminate officers of federal agencies with or without cause is expected to eventually land before the Supreme Court as this and other challenges to federal agency terminations continue. While the future of Humphry’s Executor remains uncertain, all eyes are now on the Fourth Circuit to see whether the three CPSC Democratic commissioners will remain in their positions.
Supreme Court Nixes Retiree’s ADA Benefits Suit
In Stanley v. City of Sanford, Florida, the U.S. Supreme Court held a disabled former employee who neither “holds” nor “desires” a job is not a “qualified individual” under the ADA and, thus, cannot sue for disability discrimination following her employer’s revocation of retiree health benefits.
The plaintiff, Karyn Stanley, was a firefighter for the City of Sanford, Florida (“City”) who retired after she was diagnosed with Parkinson’s disease. When she joined the fire department, disabled retirees received free health insurance until they were 65 years old. While employed and unbeknownst to her, the benefit changed and disabled retirees were eligible for two years of coverage. Following her retirement, the plaintiff learned of the benefit change and received the two years of health insurance coverage.
Stanley, post-retirement, filed a lawsuit against the City alleging that the City violated the ADA and discriminated against her as a disabled retiree when it altered the health insurance plan. The district court dismissed her ADA claim. On appeal, the Eleventh Circuit affirmed, holding that, because Stanley had retired, she could not bring such a suit under the plain language of the statute. The Eleventh Circuit’s decision fell in line with three other circuits (Sixth, Seventh, and Ninth), while two other circuits (Second and Third) held that the ADA’s text is ambiguous and construed the statute in favor of employees.
The Court granted certiorari to determine “whether a retired employee who does not hold or seek a job is a ‘qualified individual.’” In a 7-2 opinion authored by Justice Gorsuch, the Court held that the plain language of the statute protects only “qualified individuals,” which is defined by the statute as those “who, with or without reasonable accommodation, can perform the essential functions of the employment position that [she] holds or desires.” The Court found that the present tense usage of “holds” and “desires” signals that the statute does not reach retirees. The Court found that other ADA provisions governing qualification standards and employment tests similarly convey that the statute “focus [is] on current and prospective employees—not retirees.” The Court also found it notable that the ADA’s retaliation provision protects “any individual,” and thus “different language in these two provisions strongly suggests that [Congress] meant for them to work differently.”
Rejecting arguments from the dissent that the “qualified individual” language could not have been meant to apply to retirees, the majority held that “we do not usually pick a conceivable-but-convoluted interpretation over the ordinary one.” The Court added: “we cannot say Title I’s textual limitations necessarily clash with the ADA’s broader purposes . . . . If Congress wishes to extend Title I to reach retirees like Ms. Stanley, it can.”
The last section of Gorsuch’s opinion was adopted by a four-justice plurality of the Court in which Gorsuch lost support from Justices Roberts, Thomas, Kavanaugh, and Barrett, but added support from dissenting Justice Sotomayor. The plurality addressed an additional question raised by Stanley in her merits briefing. While the Court admitted that it “ordinarily . . . rejects attempts to inject ‘an entirely new question at the merits stage,’” the plurality made “an exception in this case.” In short, the plurality explored potential avenues for retirees, like Stanley, to pursue similar ADA claims, but ultimately held that none provided relief to Stanley in the present procedural posture.
A key takeaway from Stanley is that a majority of the Court supports a textualist interpretation of the ADA even when an argument can be made that such an interpretation clashes with the broader purposes of the ADA.
OIG Says Medical Device Company’s Proposal to Pay for Exclusion Screening for Customers May Violate the Anti-Kickback Statute
On June 20, 2025, the Department of Health and Human Services’ Office of Inspector General (“OIG”) issued an unfavorable advisory opinion – OIG Advisory Opinion 25-04 (“AO 25-04”).
AO 25-04 discusses a proposal by a medical device company (the “Requestor”) to cover the costs for its customers—hospitals, health systems, and ambulatory surgery centers—to have a third-party company screen and monitor the Requestor for exclusion from federal healthcare programs. The OIG concluded that the proposed arrangement would potentially generate prohibited remuneration under the federal Anti-Kickback Statute (“AKS”).
According to the advisory opinion, some of the Requestor’s customers were either requesting or requiring, as a condition of doing business, that the Requestor pay a third-party company (the “Company”) to screen and monitor them for exclusion from federal healthcare programs. Under the proposed arrangement, the Company would charge the Requestor (and not its customers) an annual subscription fee for each customer receiving these screening and monitoring reports. The Requestor estimated this would amount to approximately $450,000 in annual fees, paid directly to the Company. The Requestor would not be a party to any agreements between its customers and the Company.
In reviewing the proposed arrangement in AO 25-04, the OIG determined that the Requestor’s proposed payment of the exclusion screening fees on behalf of its customers would implicate the AKS because the Requestor would be paying for the costs associated with a service—exclusion screening and monitoring—that its customers would otherwise incur. This payment constitutes remuneration to those customers. The OIG explained that by relieving customers of this financial burden, the proposed arrangement could induce them to purchase items or services from the Requestor that are reimbursable by a federal healthcare program. According to the OIG, the proposed arrangement “presents anti-competitive risks and risks of inappropriate steering.” Specifically, the OIG noted concern that paying the fees on a per-customer basis could improperly sway customers toward the Requestor, especially over competitors unwilling or unable to offer similar payments. In support of the unfavorable decision, the advisory opinion notes the OIG’s “longstanding and continuing concerns” about the provision of free items or services by individuals and entities, including device manufacturers, to referral sources.
While the OIG noted that a different fact pattern or structure to the arrangement might have resulted in a favorable opinion, here, with these facts – including the per-customer fee structure, the OIG cited its concern about the potential for the Company to act as a “gatekeeper” of referrals. Because customers have conditioned their business on the Requestor’s payment of the Company’s fees for exclusion screening and monitoring, the OIG noted the risk that the Requestor would pay the fees to gain access to those referrals.
We typically see hospitals and health systems as the entities performing the exclusion screening of potential vendors before entering into a contract with a vendor. In the proposed arrangement in AO 25-04, the script is flipped, with customers (i.e., hospitals, health systems, and ASCs) requiring that the medical device company from which they’re proposing to purchase items engage a third party to screen and monitor the medical device company for potential exclusion and submit reports to those customers regarding the results of such screening and monitoring.
While the OIG concedes in a footnote to AO 25-04 that there is no statutory or regulatory requirement to perform exclusion screening, the OIG’s position is that screening employees and contractors each month best minimizes potential overpayment and civil monetary penalty (“CMP”) liability. Historically, the OIG has cautioned against relying on a third party to determine whether an individual or entity is excluded and warned that a healthcare provider may still be responsible for overpayments and CMPs relating to items or services that have been ordered, prescribed, or furnished by excluded individuals or entities. However, the OIG also noted in the 2013 Special Advisory Bulletin on the Effect of Exclusion from Participation in Federal Health Care Programs that a healthcare provider may be able to “reduce or eliminate its CMP liability” in such situations if the healthcare provider “is able to demonstrate that it reasonably relied on the [other entity] to perform a check of the [OIG’s List of Excluded Individuals and Entities (“LEIE”)] and “exercised due diligence in ensuring that the [other entity] was meeting its contractual obligation.” One can only assume that it was the fact that customers were conditioning business on the medical device company paying the Company on a per-customer basis to do the exclusion screening and monitoring that tipped the scale to an unfavorable opinion here.
This advisory opinion serves as a reminder that any arrangement where a provider or supplier pays for services or costs that would otherwise be the responsibility of a referral source requires scrutiny under the AKS. If one purpose of the payment is to induce referrals or purchases of items and services reimbursable by federal healthcare programs, the arrangement may violate the AKS.
Best Practices When Taking Voluntary Compliance Steps Using Workforce Analytics
The Trump administration has decisively shifted its approach to enforcing employment discrimination laws, leaving employers grappling for clarity and stability to inform their efforts to prevent and manage legal risks stemming from harassment and discrimination. Workforce analytics, accompanied by privileged legal advice tethered to risk tolerance, can assist employers to identify and address potential workplace discrimination issues minimizing legal risk amid the administration’s shifting enforcement priorities.
Quick Hits
The Trump administration has sought to end both federal enforcement of antidiscrimination laws based on disparate impact theories and to eliminate employer DEI programs.
Even with these shifting priorities, it remains critically important for employers to collect and study applicant and employee demographic data to maintain compliance with equal opportunity and antidiscrimination laws, as well as to be prepared for scrutiny under the Trump administration’s shifting policies.
Employers may want to consider proactive collection and analysis of workforce demographic data, barrier analyses, and enhanced training programs to ensure compliance with equal employment opportunity and antidiscrimination laws.
The administration—largely through the issuance of executive orders (EO)—has prioritized merit-based opportunity, sought to end usage of disparate impact theories of discrimination, rescinded federal contractor obligations to provide affirmative action and discrimination protections for women and minorities, sought to eliminate “illegal” diversity, equity, and inclusion (DEI) initiatives, and focused on stopping anti-American and anti-Christian bias and combating antisemitism. The Equal Employment Opportunity Commission (EEOC), the U.S. Department of Labor (DOL), and the U.S. Department of Justice (DOJ) have all taken actions to advance the Trump administration’s policy objectives, but questions remain.
In particular, the Trump administration’s focus on discouraging the collection of applicant data related to race, ethnicity, and sex, coupled with its messaging on unlawful race and sex discrimination in DEI programs, has many employers hesitant to collect, maintain, and analyze demographic information from their applicants and employees.
This legal landscape is especially confusing for federal contractors given the wind down of EO 11246 obligations, but the administration’s new focus impacts all employers. As a result, employers face challenges complying with legal obligations and effectively managing risks associated with workplace discrimination and harassment.
However, a close review of the EEOC’s Fiscal Year 2026 Congressional Budget Justification submitted to Congress in May 2025 reveals that EEOC investigations will continue to focus on employer data. According to the budget justification, the EEOC is committed to educating and informing its own staff to “combat systemic harassment, eliminate barriers in hiring and recruitment, recognize potential patterns of discrimination, and examine and analyze these often large or complex investigations effectively.” The agency said that in fiscal year (FY) FY2026, it plans to “conduct mid and advanced level training for field staff and assist with the development of class investigations, data requests, and data analysis for pattern and practice disparate treatment cases.” (emphasis added).
The EEOC’s characterization of budget funds sought for its litigation program is also instructive. As of March 31, 2025, 46 percent of the EEOC’s litigation docket involved systemic discrimination or class lawsuits. Citing efforts to enforce EO 14173, the Commission contemplates involving “expert witnesses” and “the discovery of large-scale selection data to prove the existence and extent of a pattern or practice of discrimination.” The Commission justifies its resource request “to remedy discrimination on prioritized issues,” and argues aggressive enforcement will result in “a strong incentive for voluntary compliance” by employers.
Shifting Enforcement Targets
Employers may see an increase in EEOC charges from charging parties and Commissioner’s as well as other enforcement activities that align with the current administration’s priorities, including enforcement regarding DEI programs, so-called anti-American bias, national origin discrimination, and anti-Semitism. As just one example, the EEOC recently settled a systemic investigation into national origin and anti-American bias for $1.4 million dollars.
EEOC Acting Chair Andrea Lucas has repeatedly warned employers that EEOC focus will be on intentional disparate treatment cases where there has been a “pattern or practice” of discrimination. Like disparate impact, “pattern or practice” claims are rooted in systemic issues and typically involve the use of statistical evidence related to allegedly aggrieved individuals.
The 2024 Supreme Court decision in Muldrow v. City of St. Louis (rejecting a heightened bar for alleging an employment decision or policy resulted in an adverse impact on terms and conditions of employment) and the 2025 decision in Ames v. Ohio Department of Youth Services (rejecting a higher evidentiary standard for employees from majority groups to prove employment discrimination), have made it easier for plaintiffs to plead and prove employment discrimination claims under Title VII. The decisions seemed to have widened the doorway for more claims from individuals from majority groups (so-called reverse discrimination claims) and potentially made it easier to evade summary judgment and reach a jury trial if litigation ensues.
Moreover, federal contractors, institutions relying on federal contracts or grants, and federal money recipients face additional concerns with False Claims Act (FCA) liability. President Trump’s EO 14173, which seeks to require entities to certify for purposes of the FCA that they do not maintain unlawful discriminatory policies, namely illegal DEI policies. The DOJ has launched an initiative to use the FCA to investigate civil rights violations committed by federal fund recipients, expanding legal exposure to such employers.
Proactive Steps
Given the current legal landscape, employers may want to take proactive steps to ensure compliance with equal employment opportunity and antidiscrimination laws. These steps may include:
Collect and Analyze Demographic Data: Collecting and analyzing demographic data can be crucial for identifying and addressing disparities within the workplace and for documenting and demonstrating reasons for employment decisions or policies. While there may be concerns about collecting demographic data, such concerns may be alleviated by keeping data confidential and analyzing it under attorney-client privilege.
Barrier Analysis: Barrier analysis involves identifying and addressing obstacles that may prevent equal employment opportunities. This can include reviewing hiring practices, promotion policies, and other employment decisions that cover all aspects of the employment life cycle to ensure they do not disproportionately impact certain groups. By conducting a thorough barrier analysis, employers can proactively address potential issues before they become legal problems and remove barriers.
Review and Update Policies: Regular reviews of and updates to employers’ antidiscrimination and harassment policies can help ensure they align with current laws and the administration’s priorities, as well as employers’ values, goals, and objectives. Such reviews may include policies related to DEI, national origin discrimination, and anti-Semitism.
Provide Training: Implementing regular training programs for company leaders, managers, and employees on new antidiscrimination enforcement developments can help prevent discriminatory behavior and ensure that all employees understand their rights and responsibilities. Updating modules and examples to reflect changing priorities may help employers remain compliant. Likewise, covering a wide variety of scenarios and examples, including majority characteristics, can be important to review and include.
Next Steps
The shifting landscape of employment law presents both challenges and opportunities for employers. To be prepared, employers can stay informed on the latest actions and consider which proactive steps may be best to avoid potential liability and achieve their goals and objectives.
Big Sky State Makes Big Privacy Updates
Montana’s privacy law has received a refresh and updates will go into effect October 1, 2025 – exactly one year since the law took effect. The law was modified with SB 297, and changes include coverage, approach with minors, and more:
Broadening who is covered. Previously, Montana’s privacy law applied only to those controlling or processing the personal data of at least 50,000 Montanans. SB 297 cuts those numbers in half, bringing in any business handling the data of just 25,000 state residents or making substantial revenues off the personal data of at least 15,000 people.
Minors. As amended, businesses offering online services, products, or features to those under 18 must use reasonable care to avoid heightened risks of harm to minors. Data protection impact assessments -will also be needed if engaging in activities that might create a risk of harm to minors. As revised, companies will need to get consent from those 13-18, or from their parents if the minor is under 13, to process minors’ information for targeted advertising, certain profiling activities, or selling of personal data. There are also restrictions on geolocation information collection and using “system design feature[s]” to increase use of online services.
Narrowed exemptions. Montana has removed the broad GLBA entity-level exemption that exists in most states (joining California, Minnesota, and Oregon). There will still be an exemption for GLBA-covered information, but the only types of financial institutions that receive the entity-level exception are banks and credit unions. Montana’s law also previously exempted non-profits, but now narrows this to only non-profits that detect and prevent fraudulent acts in connection with insurance. Delaware and Oregon’s privacy laws contain similar carveouts for non-profits.
Privacy policy updates. Under the law’s revisions, privacy policies will need to explain what rights consumers have (not just that the consumer has rights) and the types of data and third parties to whom data is shared or sold. Like California, Colorado, Minnesota, and New Jersey, Montana businesses must also state the date the privacy notice was “last updated.” Privacy notice content will need to be accessible to individuals with disabilities and available in each language in which the business provides a product or service. Links to the notices must be conspicuously posted. Material changes must communicated to consumers for prospective data collection and they must be allowed to opt out of such changes.
AG and right to cure. Finally, as amended, businesses will no longer have a statutory cure period. Previously, when the AG issued a notice of violation, businesses were given 60 days to cure.
Putting it into Practice: Montana joins California, Colorado, and Virginia in making changes to its comprehensive privacy laws. Provisions to keep in mind include privacy policy content, approach with minors’ information, and who and what is covered under the law.
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SYSTEM REBOOT ON AUTODIALERS?: McLaughlin and the Future of TCPA Statutory Interpretation
Greetings TCPAWorld!
The Supreme Court dropped another surprise that’s about to turn everything upside down again. See McLaughlin Chiropractic Assocs. v. McKesson Corp., No. 23-1226, 2025 U.S. LEXIS 2385 (June 20, 2025). McLaughlin was not, in turn, about autodialers at all—it was about whether courts must consider FCC interpretations under the Hobbs Act. But what about the ripple effects for automatic telephone dialing systems (“ATDS”)? Absolutely, potentially massive.
For the past four years, we’ve all been living in the post-Facebook (Facebook, Inc. v. Duguid, 592 U.S. 395 (2021)) world where everyone pretty much agreed on what an automatic telephone dialing system actually means. The Supreme Court seemed to settle the matter: to qualify as an ATDS, your equipment must have the capacity to store or produce telephone numbers using a random or sequential number generator and then dial those numbers.
That narrow interpretation was huge for businesses that had been facing significant challenges from TCPA class actions. Before this clarification, plaintiff attorneys were arguing that any system capable of storing phone numbers and dialing them automatically—such as a smartphone, a basic CRM system, or even predictive dialers calling from customer lists—could qualify as an ATDS. The Supreme Court’s grammatical analysis put an end to that madness by concluding that “using a random or sequential number generator” modifies both “store” and “produce,” meaning you need the random generation component for either function.
But here’s where McLaughlin comes in and changes everything we think we already know. Justice Kavanaugh’s majority opinion established a principle that will reshape how every TCPA case is litigated: district courts must independently interpret statutes under ordinary principles of statutory construction, giving only “appropriate respect” to agency interpretations. This is not a minor shift at all, as it explicitly disclaims the view that district courts are bound by FCC interpretations in private TCPA actions. WOW!
Now let’s not put the cart before the horse. That means the FCC no longer controls how district courts interpret the TCPA, although its guidance may still be considered persuasive.
This represents a gigantic shift from the old days, when FCC orders interpreting the TCPA were treated as binding under Hobbs Act jurisdictional preclusion. District courts previously could not disagree with FCC interpretations because challenges had to go to the courts of appeals. Now, following McLaughlin and last year’s Loper Bright decision, which eliminated Chevron deference entirely, federal judges must do the hard work of statutory interpretation themselves.
So what does this mean for ATDS? While Facebook settled the core definition at the Supreme Court level, there were still plenty of gray areas that the FCC had been filling in with guidance and interpretations. Now, district courts can look at those same issues with fresh eyes. See the challenge here? This will no doubt create new circuit splits and ALOT more unpredictability.
Post-McLaughlin, one district court might look at the statutory text and decide that “capacity” means what you can do right now, not what you could theoretically do with software modifications. Another court three states over might stick closer to the FCC’s broader interpretation. Yet another might split the difference and require some middle ground between current functionality and theoretical potential. Suddenly, we’re back to forum shopping and conflicting precedents across jurisdictions, with plaintiffs rushing to file in friendly districts while defendants attempt to relocate cases to more favorable venues.
Then there’s the question of human intervention. FCC guidance has generally stated that if a human must initiate every call, you’re probably not dealing with an ATDS. But how much human involvement is enough? What if a person loads the contact list, but the system dials automatically? What about click-to-call platforms where humans trigger each individual call? These cases, which seemed settled under FCC guidance, are now fair game for independent judicial interpretation.
The world of predictive dialing is an exciting one. Modern predictive dialers that operate from stored customer lists were largely exempted after Facebook, as they don’t use random generation. But there are still cases—systems that use algorithms to select numbers sequentially within targeted lists, or platforms that employ some mathematical progression that might arguably qualify as “sequential.” Without FCC deference, creative plaintiff attorneys can argue these distinctions to judges who might see things differently than the agency.
And don’t get me started on platform-specific technologies. Peer-to-peer texting systems, automated appointment scheduling, click-to-call functionality—all these technologies that the FCC has weighed in on over the years are now subject to fresh judicial analysis. A district judge unfamiliar with a specific platform may interpret the statutory language differently from an agency with telecommunications expertise.
The implications extend beyond federal courts as well. It’s only fitting that I talk about Florida, my home state. Florida’s Telephone Solicitation Act (“FTSA”) is likely the best example of how states have been attempting to fill the gap and narrow the federal interpretation. The FTSA initially defined prohibited technology as “an automated system for the selection or dialing of telephone numbers”—notice the “or” instead of “and,” and the complete absence of any random or sequential number generation requirement.
Florida amended the law in 2023 to require systems that both select and dial numbers; however, this still doesn’t incorporate the TCPA’s requirement for random or sequential number generation. You’ve got a peculiar situation where technology that’s perfectly legal under federal law may still be considered a violation of Florida state law. The McLaughlin principle doesn’t directly affect how state courts interpret state statutes. Still, it certainly signals a broader trend toward judicial skepticism of agency interpretations that extend beyond what the actual statutory text states.
Speaking of that trend, we just saw another example play out in real time. The Eleventh Circuit’s decision in Insurance Marketing Coalition v. FCC struck down the FCC’s one-to-one consent rule, essentially telling the agency that it had overstepped its authority. See Ins. Mktg. Coal. Ltd. v. FCC, 127 F.4th 303 (11th Cir. 2025). The reasoning there—that agencies can only “reasonably define” statutory provisions without altering them—sounds awfully similar to the McLaughlin approach.
So, how will this ultimately play out? I’m glad you asked. For defense attorneys, McLaughlin opens up a whole new playbook. Instead of having to work around FCC interpretations of ATDS scenarios, you can now argue directly from statutory text and context. Got a client using technology that stores numbers but doesn’t generate them randomly? Make the textual argument. Using a system with human intervention that the FCC once deemed “automated”? Point the court to the text. Using some algorithmic selection that doesn’t quite fit the random/sequential concept? Time to get creative with statutory interpretation.
The flip side is that plaintiff attorneys also gain new opportunities. They can argue for broader textual interpretations of ATDS without having to overcome existing FCC guidance. The whole question of what “capacity,” “production,” and “storage” mean in the context of modern technology is back on the table.
From a compliance perspective, this creates a much more complex landscape. It used to be that if you followed FCC guidance, you had a pretty good safe harbor. Now you’ve got to think about how different district courts in different jurisdictions might independently interpret the same statutory language. For instance, compliance that works perfectly in the Ninth Circuit might change drastically in the Fifth Circuit, not because the law changed, but because different judges reached different conclusions about what Congress meant when it wrote about ATDS.
This all fits into the constraining of administrative power and the return of interpretive authority to the judiciary. Following Loper Bright’s elimination of Chevron deference and McLaughlin’s limitation of Hobbs Act preclusion, we’re witnessing a fundamental rebalancing toward judicial supremacy in statutory interpretation. Bottom line for anyone in the TCPA space, this means possibly less predictability in the short term, but potentially more sophisticated, text-based analysis over time. Exciting stuff!
New Jersey BPU Launches Multi-Phase Energy Storage Incentive Program
Key Takeaways:
PJM-ready projects are a must. Eligible projects must (1) be transmission-connected (PJM bulk power system) and located in a New Jersey transmission zone; (2) have PJM interconnection approval (or capacity interconnection rights (CIRs) from a deactivating facility); and (3) commit to a commercial operation date (COD) within 30 months of application period close (plus a 150-day grace period). To reach a COD, the project must be fully constructed and interconnected to the PJM transmission network.
Site control and permitting matter as developers must demonstrate they are ready to secure all required approvals.
Brownfield redevelopment, community benefits and environmental attributes may be favored over lower bid levels.
The New Jersey Board of Public Utilities (BPU) approved Phase 1 of the Garden State Energy Storage Program (GSESP) after two years of stakeholder engagement. Rules related to the GSESP were also approved for publishing in a future New Jersey Register. Phase 1 is the first of a new, multi-phase incentive program to support the development of 2,000 megawatts (MW) of energy storage by 2030, as required under the Clean Energy Act of 2018 (P.L. 2018, c.17). This is a significant milestone in New Jersey’s energy policy, allowing the integration of intermittent renewable energy sources and a critical opportunity for energy storage developers to secure long-term, fixed-price incentives.
Phase 1 targets transmission-scale, front-of-the-meter energy storage systems. Distributed storage incentives will follow in Phase 2 (expected in 2026). Below is a comprehensive breakdown of what developers need to know.
Phase 1: Transmission-Scale Storage Solicitation
To align with the pending New Jersey Assembly Bill A-5267 that would require the BPU to establish a transmission-scale energy storage procurement and incentive program, the BPU limited Phase 1 incentives to transmission-scale energy storage systems, directly interconnected to the bulk transmission system. Both standalone storage and storage additions to existing solar, solar-plus-storage and other Class I renewable energy resources (solar, geothermal electric generation, landfill gas, biogas, etc.) are eligible provided they are not already receiving incentives from the Competitive Solar Program. Despite a call for increased utility involvement and ownership of energy storage systems, the BPU will limit Phase 1 incentives to private (non-EDC) and governmental entities.
Additional components of Phase 1 include:
Final awards will determine eligible projects and the size of each project’s incentive award.
Payments will be made annually over a 15-year term.
“Pay-as-bid” model bidding process where developers propose a fixed annual incentive (e.g., $/MW/year) for providing energy storage capacity. The projects awarded funding are those that offer the lowest incentive cost per MW, promoting cost-effectiveness.
Initial solicitation (“Tranche 1”) aims to procure 350–750 MW.
Total Phase 1 goal is 1,000 MW of transmission-scale storage.
The prequalification review for deficiencies for Phase 1 applications opens on June 25, 2025, with a deadline for guaranteed review of July 23, 2025. Final bids are due by August 20, 2025. The BPU will announce awards in October 2025.
Phase 2: Distributed Storage Coming in 2026
Developers with behind-the-meter or distribution-level assets should prepare for Phase 2 in 2026. Expected features include distributed fixed incentives (capacity-based), distributed performance incentives (likely grid-service or dispatch-based), participation from distributed energy resource aggregators and systems co-located with rooftop solar and EVs, and prioritization of projects that serve overburdened communities or improve distribution system resilience.
Trade Secret Law Evolution Podcast Episode 78: When Are Misappropriators Dangerous Enough to be Enjoined? [Podcast]
In this episode, Jordan discusses a recent case from the Southern District of New York where an injunction was partially granted on a breach of contract claim but not on the trade secret claim. The Court found the plaintiffs didn’t make a sufficient showing on irreparable harm, based on a lack of “danger” that the misappropriator would disclose the trade secrets to someone else.