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Featured Articles
Looming CTA Disclosure Requirements and Healthcare Providers
The Federal Corporate Transparency Act (CTA) mandates certain entities, including small healthcare providers, disclose identifying information to FinCEN from January 1, 2024, to regulate "shell" companies and combat illicit activities. Compliance challenges and potential penalties are significant.
Navigating the Evolving Landscape of Digital Assets: Insights from the Benzinga Future of Digital Assets Conference
The Benzinga Future of Digital Assets conference highlighted key trends in cryptocurrency and blockchain. Topics included preparation for Bitcoin's 2024 halving, blockchain's expanding non-financial applications, and optimism despite regulatory challenges, emphasizing the sector's resilience and evolution.
Delaware Court of Chancery Denies Preliminary Injunction Motion to Mandate a Stockholder's Nominees Stand for Election and Require a Waiver from an NOL Rights Plan
The Delaware Court of Chancery has denied a preliminary, mandatory injunction motion to compel Ocean Power Technologies, Inc. to permit one of its stockholders' nominees to stand for election at the next annual meeting and require the Ocean Power board to grant a waiver to such stockholder from its rights plan. Paragon Technologies, Inc., v. Cryan, C.A. No. 2023-1013-LWW (Del. Ch. Nov. 30, 2023).
2023 Article Round-Up
OIG Takes a Look at the Accelerated and Advance Payments Programs and the Provider Relief Fund Program
The U.S. HHS OIG conducted audits on HHS-managed COVID-19 healthcare funding programs. The first report found effective management of Accelerated and Advance Payments Programs. The second highlighted flaws in Provider Relief Fund Program controls, recommending improvements.
On April 1, 2024, California's New Office of Health Care Affordability Will Begin Pre-Closing Regulatory Reviews of Certain Health Care Transactions
California Governor Gavin Newsom signed SB-184 into law, establishing the Office of Health Care Affordability (OHCA) to oversee health care cost trends, conduct advance reviews of mergers, and enforce cost targets. OHCA Transaction Reviews start April 1, 2024.
Incomplete Gift Non-Grantor Trusts Created by California Residents May Be Subject to California State Income Tax Beginning in 2023
California Governor Gavin Newsom's proposed budget for 2023-2024 may subject the income of an incomplete gift non-grantor trust to California income tax based on the settlor's residence in the state.
SEC Adopts Amendments to Rule 10b5-1 and Related Disclosure Requirements
The SEC adopted amendments to Rule 10b5-1, introducing new conditions, disclosure requirements, and restrictions for insider trading plans. Changes include cooling-off periods, certifications, and quarterly disclosures for Section 16 officers and directors.
New York Governor Proposes Regulatory Overhaul for Investor-Backed Healthcare Transactions
The New York State Executive Budget for 2024 includes proposed legislation that would significantly expand the state's regulatory authority over healthcare transactions. The bill introduces Article 45-A "Review and Oversight of Material Transactions." This article of the Public Health Law would provide the State Department of Health increased regulatory oversight over healthcare transactions involving a change of ownership or control in physician practices, management service organizations under contract with healthcare entities, and any other healthcare facility or organization within New York.
Preparing for Your 2023 Say on Pay Frequency Vote and Reporting Results
Public companies, under the Dodd-Frank Act, must include a "say on frequency" proposal in their 2023 annual meetings, allowing shareholders to vote on the frequency of "say on pay" votes.
Taxpayers and Tax Preparers, Beware of Automated Notices of Deficiency
The IRS is increasingly issuing Notices of Deficiency without audits, relying on automated adjustments like CP-2000 notices. Taxpayers receiving such notices should promptly file a Petition with the U.S. Tax Court.
UK Signs Singapore Convention on International Mediation Settlement Agreements
The UK signed the Singapore Convention, enhancing its position as a commercial dispute resolution hub. The Convention facilitates cross-border enforcement of international mediation settlement agreements, promoting efficient dispute resolution.
Disclosure Implications of the SEC’s Stock Repurchase Amendments
The SEC, in a 3-to-2 vote, adopted amendments on May 3, 2023, significantly increasing disclosure requirements for public companies and investment firms regarding repurchases of issuer equity securities.
New Requirements for Healthcare Entity Transactions Signed into Law in New York State Budget
New York enacted Article 45-A of the 2024 Executive Budget, titled "Disclosure of Material Transactions," increasing oversight of healthcare transactions. The legislation mandates pre- and post-closing notices to the New York State Department of Health for material healthcare transactions without requiring approval.
Navigating the Corporate Transparency Act
The Corporate Transparency Act mandates certain companies to disclose personally identifiable information about beneficial owners and applicants to FinCEN starting January 1, 2024. Compliance steps should commence immediately.
Finders and Unregistered Broker-Dealers
Navigating the distinction between "broker-dealers" and "finders" under federal securities laws is crucial for deal makers. Recent SEC actions emphasize the importance of compliance to avoid legal consequences.
A Proposed New Regulatory Environment for Medicare Hospice Providers
Application of the 36-Month Rule, Increasing Enrollment Screening Processes, Informal Dispute Resolution, and Special Focus Designations
The CMS Proposed Rule seeks to include hospices in 36-month ownership transfer restrictions, subject them to high-risk screening, establish a dispute resolution process, and implement a special focus program.
CMS Proposes Behavioral Health Program Changes
CMS proposed a significant expansion of behavioral health coverage under Medicare for 2024, aiming to improve access to mental health and substance abuse treatment, address gaps in coverage, and enhance payment rates.
Should I Register My Entity to Do Business in a State? Supreme Court Case Reminds Us of the Scope of Considerations
The U.S. Supreme Court's decision in Mallory v. Norfolk Southern Railway Co. emphasizes that registering a business entity in a state may subject it to general personal jurisdiction there, allowing lawsuits unrelated to its activities.
NAIC Working Group Approves Revisions to Regulate Health Insurance Lead Generators
The NAIC's working group approved revisions to combat fraud and unfair marketing practices in health insurance lead generation. The changes define terms and subject lead generators to the Model Law's restrictions.
OIG Enhanced Review: OIG to Investigate the Life Cycle of Managed Care Contracts
The Office of Inspector General for the Department of Health and Human Services plans to investigate Medicare Advantage and Medicaid managed care contracts, addressing fraud risks and holding organizations accountable.
Are Loans Securities? The United States Court of Appeals for the Second Circuit Responds in Kirschner v. JP Morgan Chase Bank, N.A.
The United States Court of Appeals upheld a ruling that certain notes in a refinancing deal involving Millennium Health LLC aren't considered "securities," crucially relying on syndication methods and contractual language.
Nonresident Owners Selling a Business with California Contacts? Be Wary of Selling Through a Conduit Holding Entity
Nonresidents selling interests in California businesses may face unexpected state income tax exposure, particularly in asset sales or elections under Section 338. Planning can mitigate this risk.
OIG Provides Guidance on Physician Bonus Compensation
The Department of Health and Human Services Office of Inspector General released an advisory opinion on a multi-specialty physician practice's proposed bonus compensation plan, finding it likely meets statutory exceptions and regulatory safe harbors.
December 1 Deadline for Adoption of Clawback Policies
Listed companies on Nasdaq and NYSE must have adopted a clawback policy by December 1, 2023, to recover excess executive incentive-based compensation following an accounting restatement, complying with new disclosure requirements.
SEC Clarifies Proxy Rules of the Road
The SEC's Division of Corporation Finance issued proxy-related compliance and disclosure interpretations, offering guidance on universal proxy card treatment, calculating the 10-day waiting period, and disclosure aspects in contested solicitations.