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May 2017

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The state of Oregon recently enacted Oregon Administrative Rule (OAR) §441-035-0300, a new state “Blue Sky” securities law that makes it easier for an employer that is not publicly traded in the US to grant equity awards to its employees residing in Oregon. Background A company that is not publicly traded in the US — generally, a company whose stock is not registered under the Securities Act of 1933, such as US private companies or…

Last year the Department of Labor (DOL) finalized new disability claims procedure rules, effective January 1, 2018, to add more procedural safeguards and provide claimants access to more information. Covered Plans The new rules are not limited to disability plans.  They apply to all ERISA welfare and pension plans that provide benefits based on a finding of disability (e.g., vesting or payment under pension, 401(k), and top hat plans or life insurance plans that require…

A recent Delaware Court of Chancery decision builds on prior case law and provides useful insight for companies seeking to establish an effective director compensation limit in order to avoid expensive stockholder litigation. In the case, In Re Investors Bancorp, Inc. Stockholder Litigation (2017 BL 111738, Del. Ch., No. 12327-VCS, 4/5/17), plaintiff stockholders claimed that directors breached their fiduciary duties by awarding themselves “grossly excessive compensation” under a plan that, though approved by stockholders, included…

The IRS recently issued guidance in Rev. Proc. 2017-28 addressing special rules that apply when employers seek a refund of FICA (social security and Medicare) taxes.  This new guidance serves as a reminder to employers that special processes should be followed when seeking a refund of FICA taxes. Background As background, recall that FICA taxes are imposed on both the employer and the employee — half is paid directly by the employer and the other…