Right To Federal Forum
The local owner of a fast-food franchise (“Owner”) filed a lawsuit in Louisiana state court against its out-of-state general contractor (“GC”), claiming, among other things, alleged defects in the construction of the restaurant building. Although the claimed defects arose from incorrect plans and specifications, the Owner did not initially name the local architect (“Architect”) as a defendant. The GC, a Texas entity, retained Cook Yancey to protect its interests. Cook Yancey asserted the GC’s right to a federal forum by timely removing the state court action to federal court.
Thereafter the Owner sought to deny the GC its right to a federal forum by filing a motion for leave of court to amend the recently removed lawsuit to add the Architect (a Louisiana citizen) as a second defendant. The addition of the local (non-diverse) Architect would have destroyed complete diversity, resulted in the case being remanded to state court, and denied the GC its right to a federal forum. Cook Yancey protected the GC’s right to a federal forum by objecting to the Owner’s motion to amend, citing the Hensgens factors. Under Hensgens v. Deere & Company, 833 F.2d 1179, 1182 (5th Cir. 1987), federal courts considering whether to grant leave to allow the addition of a non-diverse defendant are required to balance the original defendant’s interest in remaining in the federal forum with a plaintiff’s interest in not having parallel suits in both state and federal courts. To weigh these interests, the courts consider four factors: (1) the extent to which the purpose of the amendment is to defeat federal jurisdiction, (2) whether plaintiff has been dilatory in asking for amendment, (3) whether plaintiff will be significantly injured if amendment is not allowed, and (4) any other factors bearing on the equities.
The United States Magistrate Judge denied the Owner’s motion to amend (to add the Architect as a defendant), agreeing with Cook Yancey and ruling: (1) that the Owner’s purpose in requesting the amendment was to defeat federal jurisdiction, (2) the GC had exercised its right to litigate the case in the federal forum and (3) the GC should not be deprived of that right where the Owner had ample opportunity to asserts its claim against the Architect at the time it filed suit but chose not to do so. The Owner appealed the ruling of the United States Magistrate Judge to the United States District Judge.
While the Owner’s appeal was pending, the Owner filed a second lawsuit in Louisiana state court against the Architect. After the Architect had been served and had answered the second state court lawsuit, the Owner sought for a second time to deny the GC its right to a federal forum. This time, the Owner filed a motion in the second state court lawsuit to amend its petition and add the GC as a defendant to the second state court lawsuit.
Upon learning of the Owner’s second attempt to deny GC its right to a federal forum (and subvert the federal court’s removal jurisdiction) by adding the GC as a defendant in the second state court lawsuit, Cook Yancey made demand on counsel for the Owner to dismiss the GC from the second state court lawsuit. When the Owner refused, Cook Yancey once again protected the GC’s right to a federal forum by filing a motion in federal court to have the Owner and its lawyers enjoined from proceeding any further against the GC in the second state court lawsuit and requesting an expedited hearing and briefing schedule. Within ten business days, the motion for injunction had been fully briefed and orally argued before the United States District Judge. Within thirty minutes of the oral argument, the United States District Judge agreed with Cook Yancey, and entered an injunction, enjoining the Owner and its lawyers from proceeding any further against GC in the second state court lawsuit.
Cook Yancey has a wealth of experience in Louisiana federal, as well as state, courts, including many lawyers who served as law clerks to federal judges prior to joining the firm. If you have questions about your right to a federal court forum, feel free to contact either Robert Kennedy, Jr., David Hemken or any of the other lawyers at Cook Yancey.
Robert Kennedy is an attorney at Cook, Yancey, King & Galloway. He is a member of its litigation section, specializing in Civil Litigation, Construction and Oil & Gas.
____________________________________________________________________________________________________________
What is a Tax Credit?
A tax credit is a credit issued by the government that enables a taxpayer to reduce his or her tax burden. A tax credit reduces tax liability on a dollar for dollar basis, whereas a tax deduction only reduces the amount of income subject to tax. This makes a tax credit much more valuable than a tax deduction in the eyes of a taxpayer. The value of a tax credit is set by the government, and certain types of tax credits are granted only to individuals or businesses in specific locations or industries.
There are a number of tax credits that an individual may come across during tax season, including the Child and Dependent Care Credit and the Lifetime Learning Credit. Furthermore, in an effort to encourage business development, the government provides tax credits for investments in certain projects. Several state and federal tax credits are available to incentivize business growth, but three are particularly relevant to Northwest Louisiana.
Local residents may be familiar with film tax credits. The boom in movies being made in Northwest Louisiana is due in part to the Louisiana Motion Picture Investor Tax Credit. Film production companies can earn up to a 30% tax credit on production expenditures in Louisiana, plus a 5% tax credit for payroll expenditures to Louisiana residents.
Additionally, historic tax credits are available from both the federal and state government for the rehabilitation of qualified historic buildings. Qualified historic buildings are buildings listed on the National Register of Historic Places or contribute to a national or local historic district. Shreveport, Bossier City and Mansfield combined have seven historic districts and numerous landmarks listed in the National Register. The Federal Historic Preservation Tax Inventive provides a 20% tax credit on the qualified expenditures in the renovation of a historic building. Thus, if a developer spends $5 million on qualified expenditures, $1 million in federal tax credits would be available to offset federal income taxes owed by the developer or its partners. Also, Louisiana has a 25% State Commercial Tax Credit that can be earned in addition to the federal historic tax credit and used reduce state tax liability.
Finally, new markets tax credits are designed to spur new investments into operating businesses and real estate projects in traditionally underserved areas. New markets tax credits attract investment capital to underserved communities by permitting investors to receive a 39% tax credit against their federal income tax return in exchange for making equity investments in specialized financial institutions called Community Development Entities. Most of Shreveport, Bossier City, Mansfield, and Minden qualify as traditionally underserved areas, making Northwest Louisiana a prime candidate for the use of new markets tax credits.
All of the tax credits above are subject to different regulatory frameworks. Therefore, a business interested in tax credits should consult its tax and legal advisors to determine its potential to receive and/or monetize tax credits.
Logan Schroeder is an attorney at Cook, Yancey, King & Galloway. He is a member of its business and corporate section, specializing in real estate development and finance.
____________________________________________________________________________________________________________
Request for Medical Review Panel Interrupts Prescription as to Non-Health Care Provider Joint Tortfeasor
By: Jason B. Nichols
In Milbert v. Answering Bureau, Inc., the Louisiana Supreme Court considered the issue of whether “a non-health care provider could be a joint tortfeasor with a health care provider against whom medical malpractice complaint had been filed, such that the suspension of prescription provisions of La. R.S. 40:1299.47(A)(2)(a) would apply to the filing of suit against the non-health care provider.” The Court answered in the affirmative, holding that a timely request for a medical review panel as to a health care provider interrupts prescription as to a non-health care provider, such as the physician’s answering service, who is alleged to be a joint tortfeasor.
____________________________________________________________________________________________________________
Hospital and Doctors are Separate Entities for Application of Continuing Tort Doctrine
In Haim, two doctors treated patient at Oschner for kidney problems for several years, with the last treatment occurring on April 24, 2007. Patient was treated by other doctors at Oschner, including kidney treatment, until July 20, 2011. Patient then sought treatment at another facility, where it was determined that he had been misdiagnosed by the first two physicians at Oschner. Patient filed complaint with PCF on June 22, 2012, against first two doctors. Misdiagnosis by first two doctors occurred more than three years prior to filing of complaint, so claim would be untimely absent some exception. Patient argued that subsequent treatment at Oschner, albeit by different doctors, should interrupt prescription against first two doctors because it was the same facility. The court disagreed, holding that even if other doctors at Ochsner also misdiagnosed condition subsequent to the alleged misdiagnoses by first two doctors; those acts cannot be used to interrupt prescription as to the earlier treating physicians.
____________________________________________________________________________________________________________
Defective Request for Medical Review Panel Likely Interrupts Prescription
In Ward v. Vivian Healthcare and Rehabilitation Center, the court of appeal considered whether an arguably defective written request for medical review panel suspended prescription of the action by family of deceased nursing home resident against nursing home. Family of deceased patient filed request for medical review panel with the Patient’s Compensation Fund (“PCF”) within one year of death, but listed a “date of occurrence” instead of the “date of death.” The PCF, returned the letter, stating that the claimants’ written request was defective because it did not provide the “date of death” and a brief description of the alleged malpractice. PCF’s letter stated that if a corrected request was filed within 30 days, it would be deemed to be filed as of the date of the initial filing. Patient filed the corrected request, but did not do so timely. The court held that, unlike the provision of the statute invalidating a request when the filing fee is not timely paid, provision with mandatory elements to be included in request does not have a penalty for non-compliance, and, thus, patient’s initial, arguably defective, claim was timely. It should be noted, though, that the court then found that the initial request complied with the required provisions because the “date of occurrence” was the same as the date of death. It will be interesting to see if the legislature amends the applicable statue to provide a penalty for failure to include the mandatory information in the request for medical review panel.