No Surprise: 2002 an Off Year for Leasing
September 11, 2003
For the first time in at least 7 years, the equipment leasing industry has failed to recognize net portfolio growth for a calendar year, according to the Equipment Leasing Association's Quarterly Performance Indicators Report (PIR). Although the participants in the survey differ from year to year, it is not an encouraging sign that portfolio growth for the fourth quarter of 2002 decreased 1.7% from the same period in 2001. In line with the weak economic climate, disappointing results were also seen in employment and charge-offs, while new business ended the year up slightly after an otherwise down year.
Recharacterization Risks: Beware!
September 11, 2003
To the unwary, Revised Article 9 of the Uniform Commercial Code may pose significant risks. The Article is intended to cover all transactions, <i>regardless of form</i>, that in economic substance create a security interest. Using this broad policy mandate, courts have frequently disregarded many different transaction forms that, on their face, were documented to appear to be outside the scope of Revised Article 9. When this occurs the party that is deemed a secured lender in the recharacterized transaction will face losing substantial rights — unless that party complied with Article 9's perfection rules, which typically require the filing of a financing statement.
FASB Interpretation No. 46: Assessing the Impact
September 11, 2003
In a culmination of a project begun in the wake of disclosures concerning Enron Corporations' use of special-purpose entities (SPEs), the Financial Accounting Standards Board (FASB) issued its long-anticipated interpretation of ARB No. 51, <i>Consolidated Financial Statements</i>, and FASB Statement No. 94, <i>Consolidation of All Majority-Owned Subsidiaries</i>, on January 17, 2003.
NEWS BRIEFS
September 11, 2003
Highlights of the latest franchising news from around the country.
COURT WATCH
September 11, 2003
Highlights of the latest franchising cases from around the country.
Mediation Before Litigation: Delaware Court's Expanded Jurisdiction Offers Remedy in Franchise Disputes
September 11, 2003
On May 29, 2003, the Governor of Delaware, Ruth Ann Minner, signed into law new legislation that may signal the willingness of courts to facilitate the resolution of disputes before the parties have passed the 'point of no return' and resorted to litigation. If the new model proposed in Delaware meets with success and is broadened and adopted by other courts, the development could be meaningful for both franchisors and franchisees, given that disputes frequently arise in franchise systems. Both would benefit from early resolution that would preserve the strength of the system and maintain the important relationships between the franchisor and the franchisee during the balance of the term of the franchise agreement.
O (Why) Canada? The Ontario Court of Appeal Speaks in Rare Franchising Decision
September 11, 2003
<i>Part 1 of a 2-part series.</i> Why should U.S. franchisors care about Canada and Canadian franchise law? Savvy franchisors realize that Canada's population is about the same as California's, and that the tastes of many Canadians are similar to (and molded) by their American counterparts. Also, U.S. franchisors' investment in Canada is facilitated under the North American Free Trade Agreement and the Investment Canada Act. While there are certainly similarities between the United States and Canada in the law respecting business-format franchising and trademarks, there are some major differences as well — some subtle; others not so subtle.
REGULATORY DEVELOPMENTS
September 11, 2003
The proposed arrangement between a non-profit hospital and a for-profit emergency medical services transport services provider that serves a 17-county area in a prominently rural area of an anonymous state is the subject of a new OIG ruling. On July 3, 2003, the OIG posted Advisory Opinion No. 03-14, which involved a request concerning emergency helicopter transports of trauma patients. The unidentified state's Department of Transportation had concluded there was a real need for such emergency transport services because of higher mortality rates involved in transporting patients in this part of the state to appropriately equipped emergency rooms. Under the arrangement, the ambulance provider would buy, operate, staff, and maintain a helicopter that is equipped with a mobile intensive care unit to transport trauma victims, while the hospital would provide a landing pad next to the facility, and modest crew quarters and services for the helicopter ' which would be available to any ambulance company that brings or receives a patient to or from the facility. Moreover, emergency calls to 911 in the area are routed, based on pre-determined criteria, to a predetermined hospital, based on the patient's needs.
ON THE WEB
September 11, 2003
This month, we examine a few Web sites that focus on antitrust law matters, including antitrust issues that involve the healthcare industry.
CASES IN COURT
September 11, 2003
A New Jersey medical magazine publisher recently agreed to pay $3.7 million to settle allegations it defrauded the postal service. On July 2, 2003, the U.S. Attorney's Office for the District of New Jersey issued a press release announcing that Medical World Communications, a Jamesburg, NJ, publisher, agreed to settle civil False Claims Act allegations that it defrauded the government over a 6-year period (1994 to 2000) through a scheme by which it inflated the number of subscribers to obtain a lower rate, thereby failing to pay adequate postage for mailing its periodicals.
