Efren Lemus

BREAKING NEWS - Court decision on the Corporate Transparency Act (CTA) - On Tuesday, December 3, 2024, a United States district court in the Eastern District of Texas preliminarily enjoined the enforcement of the #CorporateTransparencyAct (“CTA”) in its entirety nationwide, and also specifically stayed the reporting deadline of January 1, 2025 for reporting companies formed or registered to do business in the U.S. before January 1, 2024. (See Texas Top Cop Shop, Inc., et al. v. Garland, et al., Case No. 4:24-cv-478.) THE SITUATION, however, IS IN FLUX, as we anticipate the government to request an immediate stay on the injunction or a narrowing of its application to only the parties in the case, as well as an appeal of the injunction. In light of the uncertainty surrounding this situation, we believe that it would be expedient for clients who have not already provided the information required to file a Beneficial Ownership Interest Report (“BOIR”) to do so for their entities, so that, in the event the injunction is stayed, we can quickly and efficiently file BOIRs and ensure client compliance with the CTA, thereby avoiding costly fines. #BOIR #CTA #Deadline #BeneficialOwnership #whenitmatters

2

New Legal Insights: Godoy v. Linzner Case Update ⚖️ An appellate court in Godoy v. Linzner reaffirmed that unreasonable restraints on alienation violate California Civil Code section 711, invalidating trust provisions limiting beneficiaries to sell family property only to each other at below-market prices. Dive into the full analysis here: https://bit.ly/3Z24SIr #RealProperty #TrustsAndEstates #LegalUpdate #CaliforniaLaw

13

Attention Appellate Lawyers. You know about "expressed and direct conflict jurisdiction," and how it can be a vehicle for the Florida Supreme Court to accept a case under its discretionary review authority, right? Of course you do. But what about "misapplication jurisdiction"? 🤔 Is it a thing? Does discretionary jurisdiction lie when a district court’s decision relies "on an inapplicable case or appl[ies] precedent to different facts"? Stated differently, can the FSC accept a case "when a [district] court relies on a decision that involves a situation materially at variance with the one under review”? The answer used to be yes. 🛑 But not anymore. 🛑 In Askew v. DCF, issued yesterday, the Court held that "'misapplication jurisdiction' is beyond the scope of our conflict jurisdiction under article V, section 3(b)(3) of the Florida Constitution. The Court explained that "m]isplaced reliance on a prior decision does not mean that the two decisions will always 'directly' conflict or reach different holdings based on 'the same question of law.'" (Quoting art. V, § 3(b)(3), Fla. Const.) The decision was 7-0, but Justice Labarga concurred only in the result. The opinion deserves a read because it is the latest pronouncement by the Court on expressed and direct conflict jurisdiction, which as most lawyers know, is a very difficult standard to meet. In sum, "[e]xpress and direct conflict is a strict standard that requires either the announcement of a conflicting rule of law or the application of a rule of law in a manner that results in a conflicting outcome despite substantially the same controlling facts." (Internal quotations marks and citation omitted). And the Court does "not have jurisdiction to review a case without first finding that it directly and expressly conflicts with another decision." Govern yourselves according. 😃

13

11 Comments

BREAKING UPDATE: As of Tuesday, Dec. 3, a Texas federal court issued a nationwide injunction that blocks the implementation of the CTA and its regulations, determining that the Act is unconstitutional. Additional litigation regarding the CTA is anticipated, with the case likely moving to higher appellate courts in the coming weeks, creating additional uncertainty about the law’s future enforceability. As we await further guidance, companies have a few options on how to proceed. 1.     File reports regardless of the injunction to avoid future penalties should the law be reinstated (SST’s recommended approach). 2.     Continue preparing your filings but hold on submitting until further guidance is issued. 3.     Hold on preparing your filings under the assumption that the injunction will hold. 4.     Consult legal counsel for personalized guidance. Click here for further reading: https://lnkd.in/eJMHfqRK #BOI #CorporateTransparencyAct #FinancialReporting #AccountingFirm

5

FTC Non-Compete Rule Update - A Texas federal court has delayed the FTC’s non-compete rule for a few parties, with a final ruling expected by August 30. Another challenge may lead to a nationwide injunction. Employers should continue contingency planning. More updates will follow. #FTC #NonCompete #LegalUpdate #EmploymentLaw #BergerSingerman

2

Texas CTA Injunction Update: DOJ Rapidly Appeals On December 5, 2024, the Department of Justice (DOJ) filed a notice of appeal with the Fifth Circuit, just two days after a Texas federal court issued its ruling on December 3, 2024. This rapid appeal aims to challenge the preliminary injunction, which temporarily halts the nationwide implementation of the Corporate Transparency Act (CTA). The DOJ’s filing also suggests plans to seek a stay of the injunction. Until the injunction is lifted, FinCEN cannot enforce the CTA or impose penalties for non-compliance. As the January 1, 2025, regulatory deadline approaches, the Fifth Circuit may modify or narrow the injunction’s scope while the appeal is pending. Possible outcomes include limiting the injunction to the plaintiffs involved, restricting its application to a smaller subset of businesses, or lifting it entirely, enabling FinCEN to proceed with nationwide enforcement. When reviewing the DOJ's anticipated motion, the Fifth Circuit will weigh several factors: Strength of the Government’s Appeal: Whether the DOJ has a strong case to overturn the lower court’s ruling. Potential Harm: Whether allowing the injunction to remain would cause significant damage to public or governmental interests. Comparative Impacts: Weighing the potential harm to the government against any adverse effects on the plaintiffs. Public Benefit: Determining if granting or maintaining the injunction aligns with national interests or public welfare. To prepare for a possible reinstatement of the CTA’s January 1, 2025, compliance deadline, many organizations are continuing to collect client data and draft Beneficial Ownership Information (BOI) reports. Courts often resolve high-profile stay requests swiftly, particularly in cases involving federal regulatory authority. A decision on the stay could be issued in a matter of days or weeks. Firms that delay gathering necessary client information may encounter significant challenges if enforcement resumes before the original deadline. Recent cases, such as Firestone v. Yellen in Oregon (September) and CAI v. Yellen in Virginia (October), where courts denied similar injunctions, could influence the Fifth Circuit’s decision. These precedents suggest that the Texas ruling may face significant hurdles during the appellate process. At FastFile.ai we are actively monitoring this case and will provide updates as the DOJ’s appeal progresses.

1

The Texas Lateral Market Report is out now. There were twenty partner and counsel moves in September. For more insights into the Texas lateral market, reach out to Saadia Sultan. https://bit.ly/4fgfGcG #themccormickgroup #legal #lateralhiring

3

Important CTA Update: As of December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction against the enforcement of the Corporate Transparency Act. Please click the link for additional information: https://lnkd.in/gNtWPvqh #corporatetransparencyact #CTA #FinCEN #BOI #legalnews #legalupdate #CSRLawFirm

6

The California Supreme Court recently issued a ruling that impacts California law on the waiver of arbitration. What does it all mean? Litigators Michael G. Cross and Michael Hopkins explain in our latest #litigationalert. https://lnkd.in/ghYfDuuQ #sacramentolitigators #sacramentotrialattorneys #sacramentolitigationattorneys #sacramentolawyers #sacramentolawfirms #sacramentolitigationfirms

5

1 Comment

Good news for employers! A recent California Court of Appeal decision in Hernandez v. Sohnen Enterprise, Inc. has made it harder for employers to lose their right to arbitration over procedural issues like late payment of fees. This ruling confirms that if your arbitration agreement is governed by the Federal Arbitration Act (FAA), it takes precedence over the California Arbitration Act (CAA). Want to learn more? Contact us today. #Arbitration #EmploymentLaw #CaliforniaArbitration #EmployerRights #LegalUpdate

9

This article, written by Deutsch Kerrigan attorney Jose R. Ruiz, outlines the Louisiana Supreme Court’s May 2024 ruling in Bennett vs. DEMCO Energy Services, LLC. The Court decided that a defendant’s contractual claim for defense and indemnity against a co-defendant or third-party defendant is not legally “premature” and can be asserted during ongoing litigation. This decision resolves a conflict among appellate courts, clarifying confusion from the 2005 Suire v. Lafayette City-Parish Consolidated Gov’t case. Previously, the First Circuit deferred such claims until liability was established, while other circuits allowed them during litigation. The Bennett ruling promotes judicial efficiency and will significantly impact future defense and indemnification claims. Read the article here: https://lnkd.in/g8JGaUSx #LouisianaSupremeCourt #FirstCircuit #LegalUpdate #IndemnityLaw #DefenseClaims #Litigation #PrematurityException #ThirdPartyClaims

5

Breaking: Nationwide Halt on Corporate Transparency Act (CTA) Enforcement The U.S. District Court for the Eastern District of Texas has issued a nationwide preliminary injunction blocking the enforcement of the Corporate Transparency Act (CTA), which requires companies to disclose beneficial ownership information (BOI) to FinCEN. This ruling provides temporary relief for an estimated 32.5 million businesses, suspending compliance deadlines—including the January 1, 2025 BOI reporting requirement—and halting enforcement of penalties. However, the case is far from settled, as the government is likely to appeal, and other challenges to the CTA remain active across the country. How does this affect your business? • Reporting deadlines are currently paused. • Penalties for noncompliance are suspended. • Companies should monitor developments and stay prepared to comply if the injunction is lifted. With compliance deadlines on hold and enforcement paused, this is your chance to prepare without the pressure of immediate reporting requirements. Contact us today to determine your obligations under the CTA and ensure your business is ready for what’s next! Read the full article here: https://lnkd.in/e7sRYSem #CorporateTransparencyAct #BeneficialOwnership #Compliance #LegalUpdate

1

CORPORATE & SECURITIES LAW ALERT: Nationwide Preliminary Injunction of the Corporate Transparency Act by John DeFuria, Michelle Delaney, and Glenn Stein A federal district court in Texas recently issued a nationwide preliminary injunction temporarily halting the enforcement of the Corporate Transparency Act (“CTA”). Find out why the Court is questioning the CTA and what this means for small businesses and reporting companies filing BOI Reports by January 1, 2025. Click here to read more: https://loom.ly/ivwoWSs #CSGLaw #Corporate #Securities #alert

11