Escrow Company vs. Bank—Who Takes the Loss?

A Missouri escrow firm lost $440,000 in 2010 when someone—no one knows who—stole the username and password from the escrow firm and transferred the money from the bank to an account in Cyprus. Attorney Stanley Orszula comments on the appellate decision in favor of the bank.

Stanley Orszula

Stanley Orszula

The Eighth Circuit Court of Appeals upheld the ruling of a district court, including that the Choice Escrow and Land Title LLC could be required to pay the attorney fees for BankCorp South Inc. Orszula notes that there are different rules for how a bank treats a person who has an account and how the bank treats a company that is a bank customer. Businesses are assumed to be more sophisticated when it comes to safeguarding their money.

In this case, Orszula points out, the escrow company opted to go for a more simplified security procedure than they should have. The bank in this case had suggested more rigorous security procedures than the escrow company used. The case should be a wake-up call for businesses—and for everyone—in being careful about security measures in the cyber world.

Stanley F. Orszula is a member of the Corporate Services Practice Group of Quarles & Brady LLP, Chicago. He focuses his practice on financial institutions and banking with an emphasis on failed bank receiverships, regulatory issues, secured lending, loan workouts and the acquisition and disposition of loans and other assets. The Legal Broadcast Network is a featured network of the Sequence Media Group.

The EPA and Regulating Greenhouse Gases

The U.S. Supreme Court recently decided a case involving the EPA and its rulemaking authority to regulate the emission of greenhouse gases. Shannon Goessling comments on the decision of the Court in Utility Air Regulatory Group v. EPA.

Shannon Goessling

Shannon Goessling

Goessling opines that the Court aggressively pushed back against agency regulation that encroaches on the authority of Congress. Goessling feels that the EPA was disingenuous in its justifications for its very broad rules regarding greenhouse gases. Justice Scalia said that “[i]t takes some cheek for EPA to insist that it cannot possibly give 'air pollutant' a reasonable, context-appropriate meaning in the PSD and Title V contexts when it has been doing precisely that for decades.”

One of the issues has to do with best available control technology (BACT) to regulate emissions. The Court concluded that the EPA has to be circumspect in its approach. “It has to be on a case-by-case basis,” Goessling explains. The EPA has to look at the economic impact of their regulations. Some commentators suggest that the EPA got a scolding from the Court but emerged with most of its authority intact.

As to the question about whether the U.S. should lead the way in reducing greenhouse gas emissions that is a political issue Goessling says, that Congress should deal with.

Shannon L. Goessling is Executive Director for Southeastern Legal Foundation, an Atlanta, Georgia-based public interest law firm and policy center.  Goessling was the 2002 GOP nominee and candidate for Georgia Attorney General.  A former public servant, Goessling worked as a Senior Assistant District Attorney in metro Atlanta, prosecuting crimes against women and children.  The Legal Broadcast Network is a featured network of the Sequence Media Group.

Race Discrimination and Union Free Speech Claims

A federal jury in Florida held a county and a union liable for race discrimination. On appeal, the judgment was affirmed in Booth v. Pasco County, Florida. Employment lawyer Paul Mollica comments on the case, also discussed in his blog posting.

Paul Mollica

Paul Mollica

Mollica explains that the case began when two paramedics complained of racial discrimination by their captain. The paramedics were reassigned to locations they considered less desirable, so they asked the union for help. Subsequently, the paramedics filed claims against the county and the firefighters’ union. After the claims were filed, the union notified all union members by email that the two paramedics, who were named in the email, had filed claims, the defense of which might require the union to increase dues.

At trial, the jury found against both the county and the union. On the appeal to the 11th Circuit Court of Appeals, the union claimed that its notice to its members was nothing more than free speech under the First Amendment. Mollica says that, because the union’s email was actually a call for reprisal against the paramedics. “The union exceeded the bounds of free expression,” Mollica notes.

The use of the names of the complainants in the union email was a key factor in branding the communication as a call for reprisal. As a rule, the union didn’t include the names of complainants in communications to members about the defense of lawsuits.

Paul W. Mollica joined Outten & Golden LLP as Of Counsel in 2010. He is a frequent author and lecturer (for lawyers and courts) in the area of employment discrimination. He is a two-term past president of the Chicago Council of Lawyers, a public-interest bar association. He has been selected as a Super Lawyer© in Illinois and has the highest, AV© rating from Martindale-Hubbell. He is licensed to practice in Illinois and New York. The Legal Broadcast Network is a featured network of the Sequence Media Group.