803-254-2200 803-254-2200

For South Carolina business and legal updates:

It’s Time To Get Your Cybersecurity Plan In Place

Cybersecurity threats pose risks to every type of business. As our dependence on technology has increased, the opportunities for data to fall into the wrong hands are all around.

Every business has some understanding of the dangers of dealing with sensitive data. We’ve heard the horror stories. Hospitals have been held hostage by hackers demanding ransom in exchange for restoring access to electronic files. Data files stolen from retailers have resulted in millions of compromised credit card accounts. Threats include any way fraudsters can use your information to make a buck.

Think of a cybersecurity plan in the same way as a plan you would prepare for any other emergency. Businesses take preventative steps to avoid fires, accidents and other catastrophic events and have plans for how to respond when an emergency comes up. Fire drills, safety procedures and incident response teams can help protect businesses from physical threats. Data breaches may be more difficult to detect initially, but they can have a similar disruptive effect on your business – and on the bottom line.

continue reading

5 things every business should know about FMLA

Health issues are a part of life and often can have both personal and professional effects on employees.  Life events such as the serious illness of an employee or family member or the birth or adoption of a child may require an employee to take extended time off from work. A business must understand its obligations and responsibilities in such a scenario.

The Family and Medical Leave Act (FMLA) is a federal law that protects an employee’s job and medical benefits while he or she takes up to 12 weeks of unpaid leave for a qualifying event. Employers that meet certain criteria are covered by FMLA, and South Carolina businesses are no exception.

Under the FMLA, covered employers have specific obligations to their employees and can be subject to liability if these obligations are not followed. A business should review the following five-question checklist to assist in understanding its FMLA responsibilities:

continue reading

When Entering into a Commercial Lease, Understand Your Obligations

Entering into a commercial lease is a significant responsibility for both the landlord and tenant. Before a commercial lease is finalized, it is critical that both sides perform due diligence on the lease provisions and protections.

In City Electric Supply v. Johnny Murray – a lease dispute between an electric company and a family-run boat repair shop in North Charleston – the Court of Common Pleas granted the plaintiff’s motion for summary judgment and ordered the tenant to be evicted from the property. The case featured several legal missteps by the defendant that can serve to inform parties who are entering into commercial leases.

continue reading

Minority Shareholders Navigating a Buyout: Know The Landscape

Minority ownership of a closely held company can be a lucrative but risky proposition. A minority shareholder’s marginal voting position can unfairly empower other shareholders, especially if they vote together.

To illustrate this point, consider a family business owned by three siblings working for the company. Without laws protecting each individual shareholder, one sibling would be powerless to stop the others from cutting her out of a profitable deal or firing her and refusing to pay dividends, thereby depriving her of any ownership benefit. The two siblings could also vote on a risky business change – like selling all of the company’s assets in a blue chip market to finance the production of a fad product – without opposition from the minority owner. 

South Carolina has attempted to balance the power enjoyed by majority shareholders through laws that permit an alienated owner to force the company to buy out her shares. These laws are applicable to situations like those discussed above, when a minority shareholder is being treated grossly unfair (often called “minority oppression”) and also when a minority shareholder dissents on a vote that would fundamentally change the way the business operates or is owned, as in a merger (often called “dissenter’s rights”).       

continue reading

Not On My Land? Clarifying the Elements For a Prescriptive Easement

Imagine finding that a neighbor, or a company, or even the public has acquired the right to use part of your property without compensating you. A recent ruling in South Carolina sets new case law and provides important guidance for issuers of title insurance, parties impacted by property litigation and anyone who may be seeking advice about the validity of an easement, which is a right to cross or use someone else's land for a specified purpose.

In Simmons v. Berkeley Electric – a property dispute over whether utility companies had the right to use a individual's land for water and power lines – the South Carolina Supreme Court held that the Court of Appeals erred in recognizing two methods, adverse use and claim of right, of proving the third element of a prescriptive easement. (A prescriptive easement is earned by regular use; it is not something that is purchased, negotiated or granted, and the user does not gain title to the land.)

This ruling concluded that when analyzing the third element of a prescriptive easement, South Carolina courts should apply a new test for adverse use, which is the practice of using property without the authorization of the owner.

continue reading

Beware the Double Whammy of New Overtime Rule

By the end of the year, employers could get hit with a double-whammy from new overtime pay rules. You may have heard about the new minimum pay rule, but another aspect of the overtime rules could sneak up on you.

The big, publicized change, announced in May, is that executives, administrators, outside sales people and professionals (and some others) are exempt from overtime under the Fair Labor Standards Act (FLSA) only if they perform duties that are considered exempt (the “duties test”) and are paid a minimum of $47,476 annually, or $913 a week (the new “salary test”). The current threshold, unchanged since 1975, is only $23,660.

Read our previous post on this change in overtime rules here

What makes it a double whammy is that the attention given to the new salary test likely will prompt many employees to ask if they are correctly being classified as exempt based on the “duties test,” which is separate from the salary test. Regardless of how much someone is paid, they must be paid overtime for hours worked over 40 per week if they don’t fall into an exempt category based on their actual job duties.

Employers won a major victory when the U.S. Department of Labor left the existing definitions for exempt classifications unchanged when it increased the pay threshold. We would caution employers not to breathe a sigh of relief, however. This unchanged part of the overtime rules may prove to be quite troublesome in the months ahead. 

continue reading

New South Carolina Law Helps Fiduciaries Access Digital Assets

Our online presence can live forever. The internet is packed with Facebook pages, Twitter accounts and neglected blogs that have outlived their makers. With the increasing presence of technology in our lives, we often a leave behind a plethora of digital assets without any guidance to our fiduciaries about what they are and how to access them. Digital assets include our smartphones, tablets, personal computers, social networking site, email accounts, electronic access to our financial and insurance information, online accounts that hold a cash value such as PayPal, url addresses, blogs, and files, pictures, videos stored on the cloud. Often, these digital assets are held by a third-party custodian, and gaining access in the past has been a daunting process if the deceased didn’t have the foresight to ease this process in estate planning.

Fortunately, South Carolina passed legislation this summer that provides a pathway for fiduciaries to access the digital assets of deceased or incapacitated family members. Called the Uniform Fiduciary Access to Digital Assets Act, it sets out a process for personal representatives and others with power of attorney or fiduciary powers to view these accounts. Custodians of accounts must comply with requests to view accounts so long as access has not been eliminated by the account user, federal law, or by a separate terms of service agreement with the user. 

continue reading

Attorney-Client Privilege: Use with Care

A bedrock principle of our legal system is the protection that the law gives to communications between an attorney and the client.

Like most legal rights, however, attorney-client privilege has limits. Every word shared between a client and attorney isn’t protected. If you’re talking to a lawyer about a sensitive matter, don’t take attorney-client privilege for granted. The law provides exceptions, case law sometimes offers muddled guidance and opposing parties may litigate vigorously over what is covered. Your attorney can advise you as to how it applies to your circumstances, but here are some guidelines about relying on attorney-client privilege and waiving it. 

continue reading