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FAIR CREDIT REPORTING ACT OVERVIEW AND CASE UPDATE

OVERVIEW OF FAIR CREDIT REPORTING ACT AND CASE LAW UPDATE

There has been a consistent increase in Fair Credit Reporting Act (“FCRA”) litigation in recent years despite an overall decline in lawsuits filed pursuant to other consumer protection statutes. Most consumer protection counsel will frequently find themselves handling an FCRA claim or being asked whether one exists. This paper provides an overview of the FCRA along with recent trends and theories of liability under the statute. It begins with a discussion of the origin of the FCRA and its key amendments, includes a review of the most frequently cited provisions under the statute, and concludes with a case law update.

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Digital Music News – AFM & SAG-AFTRA Owes Session Musicians and Background Vocalists $46 Million — Here’s How Eligible Performers Can Get Paid

June 5, 2020

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As part of a proposed settlement with the American Federation of Musicians (AFM) & SAG-AFTRA, certain session musicians and background vocalists will receive a total of nearly $46 million in owed, previously unpaid royalties.

Each year, AFM & SAG-AFTRA collects and distributes millions of dollars in royalties to session musicians and background vocalists via the Intellectual Property Rights Distribution Fund (IPRDF). For reference, approximately $62 million passed through the Fund and into the pockets of hardworking singers and musicians in 2019 alone.

 

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AM FM Magazine – Session Musicians: $46 Million Digital Session Royalty Settlement Reached

June 5, 2020

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Articles

Dallas, TX, May 22, 2020 — A settlement has been reached in a class action lawsuit concerning approximately $46 million in undistributed royalties held by the AFM & SAG-AFTRA Intellectual Property Rights Distribution Fund.  The undistributed royalties are owed to session musicians and background vocalists (known as “nonfeatured performers” under the U.S. Copyright Act) on recordings that were played a sufficient number of times on noninteractive webcasting, satellite radio, or digital cable.  Any nonfeatured performers on such covered recordings who have not already received the royalties that are due to them from the Fund are included in the settlement and are entitled to receive those unpaid royalties.

 

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The Kids Are Gone… Now What?

February 13, 2020

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Children grow up. They go to college. They get jobs (hopefully). They move into their first house.  This is the natural order of things, and what we, as parents, hope for our children.

However, many couples seem to be caught by surprise at the major changes that happen when their kids leave the nest.  After all the years of focusing on the kids, their absence can often leave a void in the conversation, and in the relationship.  Some couples find themselves realizing they have to get to know each other all over again and find new topics of conversations and activities of interest.

Many couples find themselves unsure of how to proceed in this new phase of their life. Years of focusing on the kids and ignoring their own relationship may have caused irreparable damage.  While the couple was raising the children, their attention was focused on the children and not each other, and they may discover that they have grown apart.  Or there may be long held bitterness over an issue that simply can’t be resolved.  In fact, I have had many clients come to me acknowledging that they were just “holding on” until the youngest child went off to college.

Some mental health professionals have said that divorce is even harder with adult children than it is with younger kids. It is harder for both the children and the parents. The now-adult children are old enough to be aware of what is going on and they sometimes feel that they should be able to express their opinions on the situation. They are more likely to assert their views regarding their parents’ decision which puts even more pressure on the parents. They become yet another person telling the divorcing parent what they should or should not do.

Even when the children are adults, I strongly discourage my clients from putting them in the middle of the discussion, asking for their advice, or asking them to choose sides.

Their views on their parents getting a divorce should be heard and acknowledged, but they should never be asked “What do you think I should do?”  This is unfair to the children and it is unfair to the other spouse.

Also, many times the “adult” children are still dependent on their parents for support, financially and emotionally, especially if they are still in college.  Texas law does not provide for the support of adult children except in very limited situations involving an adult disabled child.  However, in the Collaborative Divorce process, the financial and emotional needs of the adult children can be taken into consideration when reaching a final settlement.  Choosing the Collaborative Divorce process to manage the divorce creates a place to make a plan that will be healthy for both parties and for the now adult children.

5 Important Rules About Separate Property in Texas

February 13, 2020

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One of the common issues that arise in a divorce in Texas is the characterization of property.  Most people know that Texas is a community property state. Many people also assume that all community property has to be divided equally in the event of a divorce.  However, property can be community, separate, quasi-community or mixed character, depending on when and how it was acquired. The name in which an asset is titled does not, by itself, determine whether that asset, or liability, is community or separate.

For example, I have people all the time say, “that’s his car because he put it in his name.” We always have to go back and ask the client to explain when, and how, it was acquired. Texas follows an inception of title rule. This says that if a piece of property is acquired during the marriage, it is presumed to be community property regardless of how it’s titled.

Rule #1

It is presumed that any property on hand at the time of divorce is community property. The spouse who is claiming an asset as his/her separate property has the burden of proving that claim by clear and convincing evidence.

Rule #2

If one of spouses is claiming that an asset is separate or mixed character property, they have the burden of showing that the source of funds used to purchase that asset were from some source that would be deemed separate property. This could be an inheritance, or a gift, or monies that they had prior to marriage.

It is the burden of the person claiming it as separate property to prove that the asset actually should be considered separate property. They must present clear and convincing evidence. This is somewhere in between a reasonable doubt and a preponderance of the evidence. It’s a little bit higher burden than we typically have in civil cases.

Rule #3

Even if you owned the property beforehand, unless you are able to prove that you owned it and that no community funds have gone into it, there is a significant likelihood that it will be deemed to be community property.

This happens when people have a bank account. They keep the same bank account during the marriage, and then they add their paychecks to it. It can become so commingled that you can no longer prove the portion that’s your separate property.

Rule #4

A piece of real estate that is acquired prior to the marriage is pretty easy to prove as separate property. You simply show when you got the title. If it was prior to marriage, it’s your separate property. Although there might be reimbursement claims if community funds were spent on that property during the marriage, the character of the property will be separate under the inception of title doctrine.  Just be careful if you refinance that property during the marriage.  Putting your spouse’s name on the property during the marriage could give your spouse a 50% interest in that real estate if your spouse argues it was a gift to them.

Rule #5

Sometimes I see situations where people bought a house during their marriage. For some reason, they only have it in one spouse’s name. That by itself does not make it that spouse’s separate property. If it was bought during the marriage, it is presumed to be community property. This is regardless of how the title is held, because it was acquired during the marriage. If the spouse whose name it’s in says, “well you know I used the $100,000 I inherited from Grandma to buy that,” it is their burden to show proof of what portion of that property is their separate property.

Proving separate property claims during a divorce requires good record keeping.  The challenge for many couples is that they had not planned to get a divorce and they have commingled their estate and assets so that everything is community property.  Which takes us back to Rule # 1 that all property is presumed to be community property… unless proven otherwise.

Is a Civilized Divorce Even Possible?

February 13, 2020

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A civilized divorce is really what I believe we would all hope for. A civilized divorce is one where both parties treat each other with dignity and respect throughout the process.

They understand that even though their relationship may be ending as husband and wife, there are benefits to their children in having an effective, healthy co-parenting relationship. Spouses who handle the divorce process with that dignity and respect get to an effective co-parenting relationship more quickly than those who go through a more acrimonious and litigious divorce. A civilized divorce can be handled through the traditional litigation process, mediation, or through the collaborative divorce process.

A civilized divorce is not the same as a Collaborative Divorce.

A Collaborative Divorce goes under the specific statutory model for Collaborative Divorce. You have to meet certain requirements for it to be classified as a Collaborative Divorce.

There are cases where litigation is really the only viable option. Often this occurs because there are mental health or addiction issues that prevent one or both parties from being able to come to an amicable resolution. Our courts are there to help those families resolve those issues through the litigation process.
From a collaborative standpoint, one of the main reasons that people will choose a collaborative divorce is for the privacy. You absolutely lose that privacy in the litigation process. For some people that is the biggest motivating factor. That also means that collaborative cases can be hard. We don’t sit around and sing “Kumbaya”. In the end, we’re trying to come to a mutually agreeable resolution. We try to be more civilized, but that doesn’t mean that they are “easy” divorces.

In cases where clients don’t want to do the full collaborative process, but they have questions or need guidance on putting together their parenting plan, we can still send them to those same collaboratively trained mental health professionals to help them put together a plan that works best for their family. We can still bring in financial advisors to help look at the assets of the community estate and the financial needs of each parent and the children to create the best solution for that family. And the other piece of a civilized divorce is having lawyers involved in the divorce who can work well with each other so that the lawyers do not become part of the problem.

What would cause a divorce to go from civilized to uncivilized?

Sometimes, it is the lawyers involved. Sometimes, it is that one or both spouses have a need to prove something. If one spouse has proven to be untrustworthy, that lack of trust can cause the other spouse to think that litigation is their only option. My biggest concern in those cases is that litigation doesn’t necessarily help the trust factor, and a case in litigation that does formal discovery doesn’t necessarily uncover all of the untruths that someone thinks their spouse is speaking or doing.

I believe that part of my role as the divorce attorney is to do my best to keep them “civilized.” Some lawyers may have tried to coin that term as a way that they handle their divorce cases. To me, it’s the old-fashioned amicable agreed divorce. Now, some of those take more work than others.  But yes, I believe a civilized divorce is absolutely possible, and a lot of that depends on which lawyers the parties hire, how healthy each of the parties is, and each party’s ability to sit down and come to a reasonable solution.