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Posts from October 2006.

In a decision issued October 24 (which is to be published), the Sixth Circuit held that employers do not engage in unlawful retaliation merely by including a waiver of an employee’s right to file a charge of discrimination with the EEOC in a severance agreement. At issue was the severance agreement offered by SunDance Rehabilitation Corp. to several of its employees who were being ...

A horse industry ethics bill making it unlawful to receive commissions from both buyer and seller without full disclosure sailed through the Kentucky General Assembly this session and was signed into law by Governor Fletcher on March 28, 2006. The new law, which took effect in July, will require written documentation of all horse sales involving more than $10,000 in addition to severely penalizing the practice of bloodstock agents receiving undisclosed commissions known as “dual agency.” The bill was sponsored by Louisville Democrat, Denver Butler, chairman of the House Licensing and Occupations Committee. However, the real impetus for the law was California winemaker Jess Jackson, better known for his Kendall Jackson wineries, who pushed for the legislation in the wake of a recent lawsuit he filed that complains of corruption in how thoroughbred horse sales are conducted. In his lawsuit Jackson has alleged that he has been defrauded out of millions of dollars by the practice of dual agency. The law has two main components: the written contract requirement and the restrictions on dual agency. 

After passing a total repeal bill five times in the last five years, the U.S House of Representatives recently passed a compromise measure, the “Permanent Estate Tax Relief Act of 2006” (H.R. 5638) by a 269-156 vote. The Act’s provisions would take effect in 2010 and improve, among other things, the estate and gift tax rates and exemption amount. While some observers expect a Senate vote soon, others question whether it will even happen this session. Just as uncertain is whether there are enough Senate votes for a bill to pass. As it stands now, it is reported that Senate Republicans are one or two votes shy of the 60 votes necessary for Senate passage.

In a new revenue ruling, the IRS has provided some concrete and helpful examples of real property interests which do, and do not, constitute active interests in a closely-held business eligible for estate tax deferral under Internal Revenue Code section 6166. Auto dealerships and other businesses which operate on personally owned realty get specific help.

On July 26, 2006,the Securities and Exchange Commission (SEC) adopted substantial changes to the rules requiring disclosure of executive compensation, related person transactions and security ownership of officers and directors. The revisions will affect disclosures in proxy statements, annual reports and registration statements of public companies. The SEC will also require that most of the disclosure be provided in plain English. Highlights of the changes include:

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