Articles by Our Attorneys

On December 20, 2019, President Trump signed the Setting Every Community Up for Retirement Enhancement Act (SECURE Act), which is effective January 1, 2020. The Act is the most impactful legislation affecting retirement accounts in decades. The SECURE Act has several positive changes: It increases the required beginning date (RBD) for required minimum distributions (RMDs) from your individual retirement accounts from 70 ½ to 72 years of age, and it eliminates the age restriction for contributions to qualified retirement accounts. However, perhaps the most significant change will affect the beneficiaries of your retirement accounts: The SECURE Act requires most designated beneficiaries to withdraw the entire balance of an inherited retirement account within ten years of the account owner’s death.

The SECURE Act does provide a few exceptions to this new mandatory ten-year withdrawal rule: spouses, beneficiaries who are not more than ten years younger than the account owner, the account owner’s children who have not reached the “age of majority,” disabled individuals, and chronically ill individuals. However, proper analysis of your estate planning goals and planning for your intended beneficiaries’ circumstances are imperative to ensure your goals are accomplished and your beneficiaries are properly planned for.

Under the old law, beneficiaries of inherited retirement accounts could take distributions over their individual life expectancy. Under the SECURE Act, the shorter ten-year time frame for taking distributions will result in the acceleration of income tax due, possibly causing your beneficiaries to be bumped into a higher income tax bracket, thus receiving less of the funds contained in the retirement account than you may have originally anticipated.

Your estate planning goals likely include more than just tax considerations. You might be concerned with protecting a beneficiary’s inheritance from their creditors, future lawsuits, and a divorcing spouse. In order to protect your hard-earned retirement account and the ones you love, it is critical to act now.

Review/Amend Your Revocable Living Trust (RLT)

Depending on the value of your retirement account, we may have addressed the distribution of your accounts in your RLT, or Testamentary Trust under your Will. Your trust may have included a “conduit” provision, and, under the old law, the trustee would only distribute required minimum distributions (RMDs) to the trust beneficiaries, allowing the continued “stretch” based upon their age and life expectancy.  A conduit trust protected the account balance, and only RMDs–much smaller amounts–were vulnerable to creditors and divorcing spouses. With the SECURE Act’s passage, a conduit trust structure will no longer work because the trustee will be required to distribute the entire account balance to a beneficiary within ten years of your death. We should discuss the benefits of an “accumulation trust,” an alternative trust structure through which the trustee can take any required distributions and continue to hold them in a protected trust for your beneficiaries.

Consider Additional Trusts

For most Americans, a retirement account is the largest asset they will own when they pass away. If we have not done so already, it may be beneficial to create a trust to handle your retirement accounts. While many accounts offer simple beneficiary designation forms that allow you to name an individual or charity to receive funds when you pass away, this form alone does not take into consideration your estate planning goals and the unique circumstances of your beneficiary. A trust is a great tool to address the mandatory ten-year withdrawal rule under the new Act, providing continued protection of a beneficiary’s inheritance.

Review Intended Beneficiaries

With the changes to the laws surrounding retirement accounts, now is a great time to review and confirm your retirement account information. Whichever estate planning strategy is appropriate for you, it is important that your beneficiary designation is filled out correctly. If your intention is for the retirement account to go into a trust for a beneficiary, the trust must be properly named as the primary beneficiary. If you want the primary beneficiary to be an individual, he or she must be named. Ensure you have listed contingent beneficiaries as well.

If you have recently divorced or married, you will need to ensure the appropriate changes are made because at your death, in many cases, the plan administrator will distribute the account funds to the beneficiary listed, regardless of your relationship with the beneficiary or what your ultimate wishes might have been.

Other Strategies

Although this new law may be changing the way we think about retirement accounts, we are here and prepared to help you properly plan for your family and protect your hard-earned retirement accounts. If you are charitably inclined, now may be the perfect time to review your planning and possibly use your retirement account to fulfill these charitable desires. If you are concerned about the amount of money available to your beneficiaries and the impact that the accelerated income tax may have on the ultimate amount, we can explore different strategies with your financial and tax advisors to infuse your estate with additional cash upon your death.

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In the event you need any assistance, please contact Joseph A. Bellinghieri at 610-840-0239 or [email protected] to schedule an appointment to discuss how your estate plan and retirement accounts might be impacted by the SECURE Act.

As social media has become an integral part of our personal and professional lives, it should come as no surprise that social media is playing an increasingly important role in litigation.  A growing body of Pennsylvania court decisions is providing guidance regarding when and how litigants can obtain social media posts from an opposing party.  Simply put, social media users should very careful about what they post online because it could eventually end up on a projector screen in front of a jury.

To begin with, information posted online to a “public” social media account – that is, an account that does not require a password or pre-existing relationship to access – is not only discoverable but is almost certainly going to be viewed by an opposing party in the course of litigation.  See, e.g., Kelter v. Flanagan, 2018 WL 1439793, *1, No. 286-Civil-2017 (C.P. Monroe Co. Feb. 19, 2018 (Williamson, J.) (“there does not [] appear to be an expectation of privacy on social media as it relates to litigation because the account holder is sharing information with others in a public or quasi-public domain.”)  Indeed, one of the first things many attorneys do is perform an online search of Facebook, Twitter, Instagram, and other popular social media sites to gather information about the opposing party that may be useful in a dispute.

As such, the first step to protecting social media posts being used in court is to designate social media accounts as private.  Courts and ethics committees have consistently held that attorneys and law firms are prohibited from becoming social media “friends” with litigants in order to access the litigants’ private social media pages. See, e.g., Philadelphia Bar Ass’n Prof’l Guidance Comm., Op. 2009-02 (2009) (an attorney, or someone under the attorney’s supervision, seeking information to impeach an adverse witness, cannot friend request the witness without revealing the purpose of the communication and disclosing to the witness the attorney’s role.)

That being said, designating a Facebook profile or other social media posts as “private” does not, by itself, prevent this information from being discoverable.  Under the Pennsylvania Rules of Civil Procedure, “… a party may obtain discovery regarding any matter, not privileged, which is relevant to the subject matter involved in the pending action…” Pa. R.C.P. 4003.1.  Moreover, Rule 4009.1 explicitly provides that a party can serve requests for electronically stored information.  Accordingly, social media posts are generally considered to fall within the broad scope of permissible discovery in Pennsylvania.  Protections against questionable discovery requests are found in Rule 4011, which prohibits discovery “sought in bad faith” or which “would cause unreasonable annoyance, embarrassment, oppression, burden or expense”.

There is currently no meaningful appellate authority on social media discovery in Pennsylvania.  Therefore, Pennsylvania trial courts have created their own tests to balance the need for discovery of relevant “private” social media posts with the parties’ privacy concerns.  Many courts have taken the position that, where a party objects to discovery of “private” social media posts under Rule 4011, the party seeking discovery must make a threshold showing that the “private” posts contain some relevant information.  As stated in Hunter v. PRRC, Inc., 2013 WL 9917150, No. 2010-SU-003400-71. (York C.P. Nov. 4, 2013) (Linebaugh, J.):

                    Where discovery has been served requesting private information contained in an account held by a party on a social media platform that the party has specifically elected to make                          private …, an objection lodged by that party to the discovery will be sustained unless the party serving the discovery makes a threshold showing that                                    otherwise available information leads to the reasonable probability that relevant information is contained within the private portions of the account. The                        hypothetical possibility that relevant or discoverable information may exist in an account held privately is not sufficient to meet this showing. Actual facts                      must be shown and, for example, can consist of public postings on the party’s Facebook page establishing that there are relevant private posts or information produced in                                     discovery that establishes that there are relevant private posts. …

Id., at *4. (emphasis added.)  See also, McMillen v. Hummingbird Speedway Inc., 2010 WL 4403285, No. 113-2010 CD (Jefferson C.P. Sep. 9, 2010) (court directed plaintiff to provide login and password information to opposing counsel because the plaintiff’s public profile indicated relevant information might be contained in the private portion showing that the plaintiff’s injuries were exaggerated); Zimmerman v. Weis Markets, Inc., 2011 WL 2065410, No. CV-09-1535 (Northumberland C.P. May 19, 2011) (Saylor, J.) (plaintiff ordered to provide defendant with all login and password information because, based upon publicly-available information, it was reasonable to infer additional relevant information was contained within the private portions); Largent v. Reed, 2011 WL 5632688, No. 2009-1823 (Franklin C.P. Nov. 8, 2011) (Walsh, J.) (after a showing that plaintiff’s recently public profile was accessed by her the night her deposition and contained posts that contradicted the plaintiff’s injury claims, the court ordered plaintiff to provide the defendant with her login and password for a period of 21 days); Kelter v. Flanagan, 2018 WL 1439793, No. 286-Civil-2017 (C.P. Monroe Co. Feb. 19, 2018 (Williamson, J.) (granting a defendant’s Motion to Compel a plaintiff to provide the defendant’s counsel with her Instagram account log-in information and holding that “social networking accounts can be discoverable, if it appears likely that they contain information that could be relevant”).

For those interested in a deep analysis of discovery of “private” Facebook posts, the 20-page opinion in Trail v. Lesko, 2012 WL 2864004, No. GD-10-017249 (Allegheny C.P. July 3, 2012) (Wettick, J.) analyzes the approaches taken in nine earlier Pennsylvania trial court decisions as well as multiple other jurisdictions.  Notably, in Trail, cross-motions to compel “private” Facebook posts were denied.  The Trail court reasoned that discovery of “private” social media posts is inherently intrusive and that the court should balance, under Rule 4011, the level of intrusion with the “potential value of the discovery” to the requesting party.  Because the “intrusions” the discovery would cause were “not offset by any showing that the discovery would assist the requesting party in presenting its case”, discovery of the “private” posts was not allowed.

In short, if you or your business has a publicly-accessible social media account, anything you say or do can be used against you in a court of law, as the saying goes.  Moreover, your “private” social media account may not be as “private” as you think.  If an opposing party can argue some facts to a judge that suggest that “private” social media posts contain relevant information, the court can order the social media posts be produced, and even require that a username and password be given to the other party’s attorney.  For anyone involved in litigation, protecting your interests and privacy in the social media age requires an in-depth understanding of this evolving area of the law.

Recently, the Pennsylvania Supreme Court decided the case of Yanakos v. UPMC, which explains the Medical Malpractice Statute of Repose and holds that it is unconstitutional because it unfairly limits victims’ constitutional rights to compensation for injury without accomplishing an important government interest.

What is the Statute of Repose?

Statutes of Repose are like Statutes of Limitations for lawsuits. Both place time limits for bringing legal claims against alleged wrongdoers.

Statutes of Limitations begin to run after the cause of action has accrued, that is when someone knew or should have known that they were injured.  In the context of a Pennsylvania Medical Malpractice action, Statutes of Limitation take into account the fact that it might take some time for you to discover that you have been injured by a medical provider’s wrongful conduct.  In Pennsylvania, the Statute of Limitation for filing a Medical Malpractice action is usually two years from the discovery of the injury.

Statutes of Repose are more strict time limitations that are measured from the date of the defendant’s last culpable conduct, regardless of when the injury occurred or was discovered.  This can result in a victim’s cause of action being past the time limit even before the cause of action is known to the victim.

The purpose of the Statute of Repose is to have an outer time limit for lawsuits so that potential defendants cannot be subject to liability long after the wrongful conduct.  However, it can be harsh on innocent victims who are harmed by the conduct yet are barred from any legal recourse.

What is the Medical Malpractice Statute of Repose In Pennsylvania?

The Pennsylvania Medical Malpractice Statute of Repose is found in the MCARE Act and it provides that there is a seven (7) year time limit with only two exceptions, (1) injuries caused by foreign objects (like surgical tools or sponges) left in a patient’s body or (2) for minors (children under 18) who have seven years from the date of the wrongful act or until age 20, whichever is later, to file the Medical Malpractice claim.

What Happened in the Yanakos v. UPMC Case?

Susan Yanakos suffered from a rare genetic condition which damaged her liver and she needed a liver transplant. In the Summer of 2003, Susan’s son, Christopher, offered to donate a lobe of his liver to his mother.  Christopher underwent extensive medical evaluation to determine whether he was a suitable donor.  Part of the evaluation included lab tests at UPMC Hospital to ensure that Christopher did not suffer from the same genetic condition as his mother which, of course, would eliminate him as a donor.

The Yanakoses received no notification of unfavorable test results from UPMC or its doctors and went forward with the transplant.

In 2014, eleven years after the transplant surgery, Susan discovered that she still had the genetic condition, which should have been cured by removal of her damaged liver and transplant of Christopher’s healthy liver.  The Yanakoses also discovered that Christopher suffered from the genetic condition.  The Yanakoses filed suit against the doctors and hospital for Medical Malpractice for failing to disqualify Christopher as a donor.

UPMC defended the case using the Statute of Repose, because the suit was filed in 2015, more than seven years after the wrongful act that occurred in 2003. The Court dismissed the lawsuit and the Yanakoses appealed claiming that the Statue of Repose was unconstitutional.

What Is the Constitutional Issue?

The state of Pennsylvania’s Constitution guarantees its citizens the right to a remedy against wrongdoers.

Article I Section 11 states:  All courts shall be open; and every man for an injury done to him in his lands, goods, person or reputation shall have remedy by due course of law, and right and justice administered without sale, denial or delay.

Pennsylvania state courts and other courts have traced this right to a remedy all the way back to the Magna Carta.

Given this constitutional right to a remedy, the Pennsylvania legislature can limit the right only if the limitation is substantially related to achieving an important government interest.

Why is the Statute of Repose Unconstitutional?

In Yanakos v. UPMC, the Pennsylvania Supreme Court ultimately decided that there was insufficient evidence that the Statute of Repose achieved an important government interest.

The Hospital’s lawyers argued that the MCARE Act’s purpose was to control the costs of medical care and medical malpractice premiums.  However, the Court found that there was no real evidence that the Statue of Repose helped accomplish that goal.  In fact, the Court noted that less than 0.5 percent of all Medical Malpractice claims were reported more than eight years after the underlying occurrence. Consequently, the Statute of Repose was found to be unconstitutional.

With this ruling, Susan Yanakos’ case will now move forward in the Trial Court.

Tim Rayne is a Personal Injury and Medical Malpractice Lawyer who helps victims receive fair treatment and compensation from insurance companies.  For over 25 years Tim has been helping Medical Malpractice victims.  Tim has offices in Kennett Square, West Chester and Philadelphia Pennsylvania.  Contact Tim at 610.840.0124 or [email protected].

The Department of Labor recently announced new overtime rules under the Fair Labor Standards Act (FLSA) that the Department estimates will make over 1.3 million salaried U.S. workers eligible for overtime pay. The FLSA generally requires employers to pay employees who work more than 40 hours in a week overtime pay of at least 1.5 times the regular rate of pay.  The FLSA contains various rules and regulations that dictate whether salaried employees are entitled to overtime pay.  Effective January 1, 2020, several significant changes in the FLSA regulations will go into effect that will affect salaried employees. These include:

1. Under the FLSA, if an employee earns below a set threshold salary level, the employee is never exempt from overtime pay. Since 2004, this salary level has been set at $23,660 ($455 a week).  The new rules will raise the minimum salary level to $35,568 annually ($684 a week).
2. The FLSA exempts employers from having to pay overtime to “highly-compensated” executive, administrative or professional employees. The new rules raise the “highly-compensated” threshold from $100,000 to $107,432 annually.
3. Non-discretionary bonuses and incentive payments, including commissions paid annually or more frequently, may be applied to satisfy up to 10 percent of the standard salary level.

Each of these changes will expand the number of U.S. workers who are eligible to receive overtime pay.  Determining which employees are impacted by the new rules will require a clear understanding of FLSA rules and regulations.

The full rule change can be found at: https://www.dol.gov/whd/overtime2019/overtime_FR.pdf.

One of the most joyous times in a person’s life is often when their child is born. But, within a marriage, what happens if the husband is not actually the biological father of the child? In Pennsylvania, the law of presumptive paternity is applied.

Under the law of presumptive paternity (the “Presumption”), generally, a child conceived or born during the marriage is presumed to be the child of the marriage despite the possibility that a husband may not be the true biological father of the child. This Presumption is one of the strongest presumptions of the law of Pennsylvania. The Presumption applies where the underlying policy of the Presumption, i.e., to preserve marriages, would be advanced by its application.

Facts that have led Pennsylvania courts to apply the Presumption include the husband being present at the child’s birth and being named on the birth certificate, the husband participating in the child’s baptism, and overall supporting the child. Other examples include the husband and wife maintaining their joint relationship, marital and financial, despite the wife having an affair that could have produced a child. Specifically, in one instance, when the husband had not become aware of the extramarital affair until after the child’s birth.

Overall, Pennsylvania courts will apply the Presumption when there is a dispute about the identity of the child’s biological father, there would be harm to the husband and wife’s relationship, and the application of the Presumption would protect the child.

Although the Presumption can be implemented, Pennsylvania courts have not applied the presumption in every situation. If the evidence fails to support that the child’s parents remain in an intact marriage, then the Presumption will not be applied.

Facts that have led Pennsylvania courts to not apply the Presumption include, the wife having an affair while still being married; the wife leaving the marital home after learning that she was pregnant; the husband and wife separating; the husband and wife filing for divorce; and a third-party male, other than the husband, being listed as the father on the child’s birth certificate. Typically, more than one of these instances will need to be present before the court makes a determination.

In conclusion, in order to forward the public policy of preserving marriages, Pennsylvania courts may apply the presumption of paternity when appropriate, even if the DNA of the child would yield a different result.

Law Clerk, Ryan Messina, contributed to this article.

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Like the families we serve, matters of family law come in all shapes and sizes—and our Pennsylvania and Delaware Family Law attorneys are equipped to manage and resolve a variety of legal issues. Our attorneys cover all aspects of family law, from drafting prenuptial agreements before parties marry to negotiating divorce settlements when a marriage ends, as well as helping parents resolve child custody disputes. Learn more about our family law practice.

Lance Nelson, chair of MacElree Harvey’s family law practice, has over 25 years of experience representing clients in family law matters such as divorce, marital agreements, adoption, custody, and support.