Nashville Bar Journal | December 2013 - January 2014

Nashville Bar Journal

Dec.13/Jan. 14 - VOL 13, NO. 11

Helping Nashville Artist Casey Summers

#SecuritiesViolation: How Social Media Use Affects Investment Advisers and Broker Dealers Matthew A. Pierce

Health Care Reform In America: The Good, the Bad and the Ugly Jerry W. Taylor

Gadget of the Month

Bill Ramsey & Phillip Hampton

NEW YEAR’S RESOLUTIONS - MORE “ME” TIME

WWW.NASHVILLELEXUS.COM

A Monthly Publication of the Nashville Bar Association

Articles 6 8

Departments 2

Helping Nashville Artist Casey Summers

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#SecuritiesViolation: How Social Media ......

Use Affects Investment Advisers and Broker Dealers

10 Health Care Reform In America: The Good, the Bad and the Ugly Matthew A. Pierce

From the President Communique • YLD Board • Lawyer2Lawyer Program • Civil Rights Room - 10th Anniversary • Golden Oldie Reveal • Upcoming Events

CONTINUING LEGAL EDUCATION

Jerry W. Taylor

CENTER SECTION

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Columns 12 14 16

NBA Annual Meeting & Banquet Review

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Disclosure - Announcements • Kudos • People on the Move • Firm News • In Memory Classified Listings

Gadget of the Month

Bill Ramsey, Neal & Harwell, PLC Phillip Hampton, LogicForce Consulting

Golden Oldie

CLE Presenters & Producers Identify the individuals in the photo. Be the first to email the correct answer to nikki. gray@nashvillebar.org and your name (along with your correct entry) will appear in next month’s issue.

NBA Calendar of Events December 24-27 NBA Offices Closed

January 30- 12 PM CLE: Bankruptcy Lunch & Learn

December 31 & January 1 NBA Offices Closed

February 22, 2014 Race Judicata @ Percy Warner Park

January 14 - 11:30 AM LAW Board Meeting January 15- 11:30 AM CLE Committee Meeting

February 28 - March 1, 2014 Mock Trial Competition

January 16- 11:45 AM NBA Committee Chair Orientation

Committee Meetings are held at the NBA Offices unless otherwise noted l o= Special Event l Full Calendar online at www.nashvillebar.org

' A Monthly Publication of the Nashville Bar Association

Charles K. Grant, Publisher William T. Ramsey, Editor-in-Chief ramseywt@nealharwell.com

Eleanor Wetzel, Managing Editor eleanorwetzel@jis.nashville.org

Journal Staff:

Nikki Gray, Director of Communications nikki.gray@nashvillebar.org

Tina Ashford, Communications Coordinator tina.ashford@nashvillebar.org

Editorial Committee: Kelly L. Frey Kathleen Pohlid Tim Ishii Tracy Kane Everette Parrish Bill Ramsey Rita Roberts-Turner Eleanor Wetzel David Winters Victoria Webb

Nashville Bar Association Staff Gigi Woodruff Executive Director ----------Tina R. Ashford Communications Coordinator Susan W. Blair Director, Continuing Legal Education Shirley Clay Finance Coordinator Wendy K. Cozby Lawyer Referral Service Coordinator Nikki R. Gray Director of Communications Traci L. Hollandsworth Programs & Events Coordinator Malinda Moseley CLE Coordinator Judy Phillips CLE Coordinator Vicki Shoulders Membership Coordinator/Office Manager The Nashville Bar Journal, ISSN 1548-7113, is published monthly by the Nashville Bar Association at 150 Fourth Avenue North, Suite 1050, Nashville, TN 37219, (615) 242-9272. Periodicals Postage Paid, Nashville, TN (USPS 021-962). Subscription price: $25 per year. Individual issues: $5 per copy.

POSTMASTER: Send address corrections to Nashville Bar Journal, 150 Fourth Avenue North, Suite 1050, Nashville, TN 37219

No part of this publication may be reprinted without written permission of the Nashville Bar Journal Editorial Committee. The Nashville Bar Journal is not responsible for the return or loss of unsolicited manuscripts or for any damage or other injury to unsolicited manuscripts or artwork.

All Articles and Letters contained in this publication represent the views of the authors and do not necessarily reflect the opinions of the Nashville Bar Association.

Nashville Bar Association 150 Fourth Avenue North Suite 1050 Nashville, TN 37219 615-242-9272 Fax 615-255-3026 www.nashvillebar.org

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Nashville Bar Journal - November 2013

From the President On Moving Forward by:

Charles K. Grant

It is my honor to serve as the next President of our great Bar Association. I especially want to thank John Kitch, Judge Randy Kennedy, and John Tarpley for their leadership and support.

The historical nature of this moment is not lost on me. I reject the notion some share that many of the epochal events in our history were inevitable. As Dr. Martin Luther King has written, "human progress is neither automatic nor inevitable‌.

Every step toward the goal of justice requires sacrifice, suffering, and struggle; the tireless exertions and passionate concerns of individuals." As a black man, I know that I am in my new role because of the work of so many lawyers before me who have labored tirelessly in the courts of this land for equal rights and equal opportunities. We all owe a great debt of gratitude to the courage, the sacrifice, and the resolve of lawyers like J.C. Napier, Z. Alexander Looby, Avon Williams, A.A. Birch, and so many others.

I want to make a few comments about Mr. Looby. I was born and raised here in Nashville where "Lawyer Looby" was revered. On a personal note, he was a dear friend of my parents, Verleon and Roscoe Grant. My father and Mr. Looby were involved in Republican politics and my mother was one of his "block captains" during his campaigns for the Nashville City Council, where he served for 20 years. Everyone in our household was well versed on his exploits in the courtroom.

Zephaniah Alexander Looby was born in Antigua, British West Indies, in 1899.

His mother passed away when he was five and his father passed away when he was 14. At 15, Mr. Looby left the island of his birth and found his way to the United States. Taking odd jobs here and there, he worked his way through Howard University, earning a Bachelor's degree in 1922. He later earned a Bachelor of Law degree from Columbia University in 1925 and a Doctor of Juristic Science from New York University in 1926. Mr. Looby worked several years at Fisk University as an assistant professor of economics.

In 1928, Mr. Looby was admitted to the Tennessee bar. His active and successful practice as a preeminent civil rights lawyer, criminal defense attorney, and a general practitioner over the next 44 years significantly impacted the lives of many persons inside and outside the State of Tennessee. From 1943 to 1945, he presided over the James C. Napier Bar Association (now known as the Napier-Looby Bar Association), an affiliate of the historically-black National Bar Association. In 1951, Mr. Looby was elected to the Nashville City Council, along with fellow lawyer, Robert E. Lillard. They were the first African Americans to serve on the Council since 1911.

One of his more celebrated cases involved leading the defense of 26 black men charged with rioting and attempted murder following an alleged "race riot" that occurred in Columbia, Tennessee in 1946. The NAACP hired Mr. Looby (who was a member of the NAACP National Legal Committee), a white Chattanooga attorney named Maurice Weaver, and future U.S. Supreme Court Justice Thurgood Marshall (who was well known even then) to represent the defendants.1 Following a lengthy trial before a jury of 12 white men, Mr. Looby's legal defense team secured the acquittal of 23 of the defendants. The result shocked the national press as well as parties on all sides of the "race question."

Following the momentous U.S. Supreme Court decision of Brown v. Board of Education of Topeka, Kansas in 1954, Mr. Looby filed a lawsuit against the Nashville public

2014 NBA BOARD OF DIRECTORS

schools on behalf of a local barber whose son was denied access to a nearby white school. Mr. Looby is credited with desegregating the Nashville Airport's dining room and the city's non-private golf courses.

When the student sit-ins began in Nashville in 1960, Mr. Looby became their first attorney, an action that resulted in his home being dynamited later that year. Mr. Looby and his wife, Grafta Mosby, were sleeping in the back of the home and were uninjured in the attack.

In 1955, this great lawyer applied for membership in the Nashville Bar. His application was declined because of his race. In December 1965, a vote of the entire membership of the Association was taken on the question of whether to admit Negro attorneys. The results were 260 votes for admittance and 175 against admittance.2 In light of this vote, on January 5, 1966, the Association formally approved an instruction to the Membership Committee "not to give any consideration to the race or color of anyone making application for membership."3 Mr. Looby died in 1972. Noting "the significant contributions of this distinguished lawyer," the Association in 1982 approved a membership certificate posthumously.4 Some of you may recall that the Nashville Bar Association honored Mr. Looby as part of its 2010 Law Day program with "Tired of Waiting," a reenactment of the 1960 Sit-in trials. Today, a portrait of Mr. Looby hangs in Judge Joe P. Binkley's courtroom in the Fifth Circuit Court, where it has been hanging since former Fifth Circuit Judge Walter Kurtz placed it there in the mid-1990s.

We have come a long way as a bar association and as a profession, and we owe a debt of gratitude to Mr. Looby and many others like him. Let us continue their work to ensure that our profession, our Bar, and our Bench are fully inclusive and reflective of our community at large. n

Charles K. Grant, President Edward D. Lanquist, Jr., President-Elect Dewey Branstetter, First Vice President John C. McLemore, Second Vice President Thomas J. Sherrard, Immediate Past President Stacey Billingsley Cason, Secretary Nicole James, Treasurer Hon. Joe B. Brown, Assistant Treasurer Gareth Aden, General Counsel Hon. Joe P. Binkley, Jr. Kathryn S. Caudle Irwin J. Kuhn Claudia Levy Hon. Randal S. Mashburn Jeffrey Mobley Andrea P. Perry Matt Potempa Sara F. Reynolds Nathan H. Ridley Maria M. Salas Saul Solomon Jocelyn A. Stevenson Overton Thompson, III M. Bernadette Welch

Got an Idea for an NBJ Article?

We want to hear about the topics and issues readers think should be covered in the magazine.

Send it to nikki.gray@nashvillebar.org

NASHVILLE BAR ASSOCIATION

(Endnotes) Thurgood Marshall arrived in time to assist with the trial but became ill and was hospitalized for about three months. A fine account of the events leading to the riot, the pretrial proceedings and the trial itself can be found in No More Social Lynchings (Hillsboro Press 1997) by Robert W. Ikard.

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December 9, 1965 NBA Minutes of the Meeting of the Board of Directors ("NBA Minutes"). I want to thank John McLemore for sending me a copy of these minutes, as well as other Board minutes and related contemporaneous documents.

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January 5, 1966 NBA Minutes.

According to the September 7, 1982 NBA Minutes, William J. "Joe" Haynes, Jr. made a motion that Mr. Looby be made a member of the Association posthumously and that the President be authorized to present a certificate evidencing such to his widow at [the Napier-Looby Bar Association] banquet on October 14. The motion carried.

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Each day, we work hard to help people and businesses in our community. The NBA has a wide variety of services and programs that can help lawyers work smarter, stay informed and keep connected with fellow attorneys. From sole practitioners to the largest firms, from legal aid attorneys to those in private practice, the NBA supports all of us so we can better serve our clients and the justice system.

Our Bar Association is much more than just a collection of services.

The power of our membership lies in the power of the people.

WE are the Bar. And together, we shape the future of the legal profession.

Nashville Bar Journal - November 2013

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NBA NEWS

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Nashville Public Library Celebrates 10-year Anniversary of the Civil Rights Room and Collection Visited by tens of thousands since opening in 2003, the Civil Rights Room at Nashville Public Library (NPL) captures a time when thousands of African-American citizens in Nashville sparked a nonviolent challenge to racial segregation in the city and across the South. The collection consists of primary and secondary sources on key events, participants, and reform movements aimed at abolishing public and private acts of racial discrimination. Materials in the collection include published audio and video imprints, ephemera, oral histories, periodicals, photographs, dissertations, and manuscripts.

On December 7th, NPR Host and Special Correspondent Michele Norris—author of Grace of Silence and host of “The Race Card Project,” an initiative to foster a wider conversation about race in America—visited the library to headline a conversation about race, class, and current civil rights issues as part of the library’s conversations@npl series (previously termed as the civil rights programs). The conversations@npl series promotes reflection, discussion and debate on topics ranging from poverty and immigration to race, class, and economics. Discussion Topics have included The Lessons of Nonviolence with John Lewis, Bernard Lafayette, Jim Bevel, John Seigenthaler, Jim Lawson, Diane Nash, and C.T. Vivian; The Freedom Riders, The Music of the Movement, Women of the Modern Movement, and Traveling Jim Brow.

Andrea Blackman of the NPL noted that since 2010, "we’ve deliberately planned programs that encompass a progression and evolution of civil and human rights, while forging a path toward transforming the community, state, and country in conversations and dialogues." During this time the focus of public programs and community engagement shifted to include current, national and pressing issues as part of the Conversations @ NPL series and include notable public programs such as: A New Dialogue in Civil Rights with NPR's Juan Williams, Separate Can Never Be Equal: The Other Side of Segregation, Clearly Invisible: Racial Passing & the Color of Cultural Identity with Dr. Marcia Dawkins, and A Conversation with Michele Norris For the past decade, the Civil Rights Room and Collection has brought history to over 26,000 learners of all ages. The Collection is the subject of in-depth documentaries, plays and an undergraduate history course "Voices from the Movement: Then and Now,” which is part of a partnership between the library American Baptist College (ABC), Lipscomb University, and Fisk University. This course explores the history of the civil rights movement and discuss how its lessons apply to Nashville today.

Additionally, The Civil Rights Room has been part of a national Summer Pilgrimage; hundreds of professors, scholars, and students travel every summer from Geneva College (Beaver Falls, PA), University of South Florida, Stetson University (DeLand, Florida), and Hamline University (Saint Paul, MN) to utilize the room and resources as part of a field study courses designed to introduce students to the civil rights movement.

The Civil Rights Room's design and architecture boasts with recognition including the Design Award of Merit (2005), Design National Honor Award (2006), and ALA National Design Award (2006). For more information visit library.nashville. org/civilrights/collection.htm.

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Nashville Bar Journal - November 2013

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NBA NEWS

Nashville Bar Association Young Lawyers Division Executive Board Directory PRESIDENT Erin Palmer Polly, Walker, Tipps & Malone PLC (615) 313-6000; epolly@walkertipps

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Nashville Bar Association Lawyer2Lawyer Mentoring Program New lawyers are often faced with questions and challenges they may be uncomfortable sharing with their new supervisors. Questions about career choices, work-life balance, professional and ethical issues, or the application of the law in certain areas are but a few.

PRESIDENT ELECT Ryan Levy, Waddey & Patterson P.C. (615) 242-2400; rdl@iplawgroup.com SECRETARY Lauren Paxton Roberts, Stites & Harbison PLLC (615) 782-2200; lauren.roberts@stites.com TREASURER Colleen S. Bracken, HCA (615) 344-5860; colleen.bracken@hospitallaborlaw.com IMMEDIATE PAST PRESIDENT Robb Bigelow, Dickinson Wright (615) 620-1702; rbigelow@dickinsonwright.com

The Nashville Bar Association offers to-the-point mentoring for members who have practiced for no more than 7 years.

Call or email one of our many experienced lawyers who are more than willing to discuss your concerns, answer your questions, and give recommendations about being a successful lawyer in today’s society.

To sign up for Lawyer2Lawyer, visit: www.nashvillebar.org

EVENTS DIRECTOR Jeff Gibson, Neal & Harwell, PLC (615) 244-1713; jgibson@nealharwell.com

UPCOMING EVENTS:

MEMBERSHIP DIRECTOR Matthew Kroplin, Stites & Harbison PLLC (615) 782-2200; matthew.kroplin@stites.com PROFESSIONAL DEVELOPMENT DIRECTOR Justin McNaughton, Waller Lansden Dortch & Davis, LLP (615) 244-6380, justin.mcnaughton@wallerlaw.com PUBLIC SERVICE DIRECTOR Tera Rica Murdock, Waller Lansden Dortch & Davis, LLP (615) 244-6380; terarica.murdock@wallerlaw.com

Race Judicata Percy Warner Park February 22, 2014 -------------------------------------Mock Trial February 28 - March 1, 2014 --------------------------------------

Full listing of the YLD Board is available on our webstie: www.nashvillebar.org

-Golden Oldies Allen Lentz correctly identified the individuals in the November 2013 Golden Oldies photo.

Pictured are: Izzy Schulman and Joe Martin Sr

Nashville Bar Journal - November 2013

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Feature

Helping Nashville Artist by:

Casey Summers

A Nashville songwriter is suddenly faced with an all-too-familiar problem: his publishing company is no longer sending him the monthly advances due for his songs. Then the publisher stops even returning his calls, and the songwriter see his chances of recouping his long-overdue payments and pursuing his dreams of success in the music industry vanish. To make matters worse, he is still under contract with the publisher so he can’t sign with a new publishing company that promises a regular paycheck. What is a struggling artist to do—without money coming in, he can’t pay his bills much less hire a lawyer to help.

Fortunately local artists with legal problems now have someplace to turn, the Volunteer Lawyers and Professionals for the Arts (VLPA).

VLPA is the cornerstone program of the Arts & Business Council of Nashville (ABC) and exists to help promising artists in all genres and artistic disciplines by providing pro bono legal assistance. VLPA also provides legal and business services to emerging nonprofit arts organizations of the Greater Nashville area. Since its founding in 2006, VLPA has provided over $1.2 million in free legal assistance to Nashville’s creative community, serving more than 1,500 artists and 350 arts nonprofits.

VLPA can assist creative people with a wide-range of legal needs related to their artwork, including drafting and reviewing all manner of arts and entertainment contracts, copyright registration or infringement, working to resolve all manner of disputes, trademark matters, First Amendment issues, labor and employment issues, and nonprofit or tax-exempt matters. More recently, VLPA added other professional volunteers to its roster (such as accountants, IT and HR professionals), who assist nonprofit arts organizations in matters such as budgeting, accounting systems, IT troubleshooting, personnel policies, hiring/firing consultation, and more.

One such nonprofit is Southern Word (formerly Youth Speaks Nashville), an organization committed to providing youth, especial6

Nashville Bar Journal - November 2013

ly in underserved communities, with opportunities to develop and publicly present their voices through poetry. VLPA volunteer lawyer Rob Pinson of Bone McAllester Norton PLLC helped Southern Word navigate the 501(c)(3) application process to become a tax-exempt nonprofit organization. After formation, another VLPA volunteer John Ray Clemmons of Chaffin, Burnsed & Blackburn PLLC worked with Southern Word to negotiate a partnership for Southern Word’s educational programs. Southern Word remains extremely active, drawing big crowds for their spoken-word events, and providing classes through Metro schools.

All services offered by VLPA are free to low-income artists and art organizations residing in Tennessee. The income limits for artists are based on the guidelines set by the U.S. Department of Housing and Urban Development, and are similar to those of other area pro bono programs. Tennessee nonprofit arts organizations also qualify, as long as they have an annual operating budget of $1 million or less. Potential clients must verify their income both by documentation (such as income tax returns or paystubs) and by signing a client agreement verifying that they are not misrepresenting their circumstances or they will be held responsible for any legal fees incurred. VLPA takes this commitment to thorough screening of clients seriously to ensure that VLPA volunteers are only engaged by clients who truly would not otherwise have access to legal counsel.

The organization was founded by current Executive Director Casey Summar and board member Bo Spessard as the Tennessee Volunteer Lawyers for the Arts (TNVLA), becoming the first and only organization of its kind in Tennessee. With the help of a start-up grant

from Vanderbilt University Law School, the TNVLA office opened in the fall of 2006, serving two clients on that first day.

In 2009, the organization merged with the ABC to augment its mission of connecting arts and business, and continues to operate as one of the ABC’s four core programs.

In 2013, ABC became a nonprofit-in-residence of Belmont University, moving into an office on the first floor of Belmont’s new College of Law. As most artists will need VLPA’s aid at some point in their careers, the reach of the organization’s reputation has grown quickly through referrals and community outreach, and currently assists with an average of 400 legal cases each year. Many artists and organizations are referred to VLPA by word of mouth through the Nashville creative community, as well as through partnering organizations.

Once a qualifying artist has contacted VLPA, they can receive legal counsel through one of two channels.

Some questions and concerns are handled directly by VLPA staff (including about a dozen legal interns), by providing educational resources, one-on-one legal counseling clinics, and seminars. Over 1,500 members of the arts communities have attended a seminar presented by the ABC on topics such as “Gallery Relationships,” “Songwriter Contracts,” and “Copyright Basics.”

If the educational offerings and staff cannot fully meet a client’s needs, VLPA has an network of over 250 volunteer lawyers from over 40 local law firms ready to come to an artist’s aid. However, as VLPA grows, so does its need for more local pro bono lawyers. Since VLPA matches artists and arts organizations with the appropriate volunteer lawyer and provides guidance through the process, the organization provides a great way for local lawyers to get involved in the local arts community (even if the lawyers aren’t intellectual property specialists).

Often, local lawyers find their work with VLPA a fulfilling way to give back to the artistic community they too are a part of.

One VLPA volunteer, Christopher Hugan of Evans, Jones & Reynolds, P.C., is a lawyer by day but also a guitar player and former recording engineer who understands the challenges faced by low-income artists with a lack of legal expertise. In the course of his work with his VLPA client, songwriter Dan DeMay, attorney and client discovered they share several mutual songwriting and musician friends, and the VLPA attorney confirmed for his client the supportive community that gives Music City its reputation for cultivating new artists.

Dan described Chris as follows: “He was professional in all of my dealings with him, but he also cared about my situation. Nowadays that’s a rare thing to find and I am most grateful.” Indeed, VLPA’s mission to match the legal and business needs with the business acumen of local professionals could not be accomplished without the generosity and commitment of its roster of volunteer lawyers.

Even when an artist who does not qualify for pro bono services through VLPA, the organization makes a paying referral to a member lawyer who is willing to take the case. Additionally, member lawyers receive other benefits such as monthly email newsletters, discounts on seminars and continuing legal education (CLE) events, and invitations to social and networking events. VLPA is funded by a variety of sources from foundations to law firms including the membership fee, for which volunteer lawyers receive a discount.

The services the ABC provides to the creative community extend beyond VLPA. In addition to the VLPA matching and referral program, the ABC provides educational programs, seminars and intensive training sessions to give artists and

nonprofits the skills and tools to manage the business side of their artistic careers.

Recent seminars have focused on craft fair presentation and small business arts administration. ABC also coordinates the Arts Board Matching, which matches and places professionals in leadership roles in local arts organizations (after volunteering with VLPA, several local attorneys have participated in the Arts Board Matching program to take on a deeper commitment of board service with a local arts organization). The Arts Board Matching program helps Nashville’s art organizations find dynamic leadership to promote their causes, and business professionals find a creative outlet that enables them to have an impact on the community while taking risks, making creative decisions, and resolving conflicts. Additionally ABC’s created a program called WorkCreative, which focuses on bringing music, visual and performing arts into the workplace to help businesses learn the value of creativity. The ABC matches local artists and arts nonprofits with businesses looking to spark communication, creativity, and growth.

Both parties benefit from the connections the ABC fosters, and the integration of the arts into the business community builds teamwork and deepens relationships.

Through these programs at the ABC, some business professionals find themselves with projects they might never have been able to work on otherwise. Lawyer David Crow from Milom Harsnell Crow Rose Kelley PLC did just that when he drafted synchlicensing agreements and co-publishing agreements for Andy Duensing, a twentysomething filmmaker with a small film project and lots of legal questions. Lawyer Stacey Schlitz of SchlitzLAW joined in to help drafted his profit participation forms.

Through their partnership and thanks to VLPA, Mr. Duensing’s local film, MakeOut with Violenc,e went on to be chosen for several film festivals and received praise Continued on Page 15 

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Feature

#SecuritiesViolation:

How Social Media Use Affects Investment Advisers and Broker Dealers by:

Matthew A. Pierce Imagine an electronic source that provided breaking news to 200 million people about everything from the crisis in the Middle East to the latest football scores to local politics.1 Now imagine that same source being used to inform your friends, “I can’t wait to go out this weekend #YOLO.”2 This hypothetical has become a reality with the advent of social media and its millions of daily users. Social media provides a platform for people to share tidbits of information to a large amount of people with the click of a mouse or the press of a button.

The information can be relevant, ridiculous, true, or false; almost anything the user wants to post. While social media has opened up the world for many businesses, journalists, and entrepreneurs, it has caused concerns among regulators and industry leaders in several fields. Specifically, in the securities industry the ability to disseminate unchecked information to the masses can lead to big problems.

In January 2012, Anthony Fields tried to sell more than $500 billion in fraudulent securities through the social media website, LinkedIn.3 Fields used LinkedIn posts to promote fictitious bank guarantees and medium term notes through his two sole proprietorships. He provided false information about assets, clients, and background before the Securities and Exchange Commission (SEC) shut down his operation, alleging violations of selling unregistered securities and holding himself out to be a broker-dealer.

Fields’s billion dollar fraud attempt highlights concerns that regulators have with broker-dealer agents (BD agents) and investment adviser representatives (IA reps) using social media.

The social media site allowed an unregistered person to act as a broker-dealer, promote unregistered (and in this case, nonexistent) securities, bypass all recordkeeping requirements, and communicate directly with the public with very little effort. In

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Nashville Bar Journal - November 2013

response, the SEC issued guidance on how to use these new channels responsibly and legally. The guidance made clear that enforcement actions would come not only against outright scam artists but also against legitimate BD agents and IA reps who act carelessly in their use of social media.

The SEC’s guidance joined the Financial Industry Regulatory Authority (FINRA) guidance to help clarify how securities laws apply to IA reps’ and BD agents’ use of social media. Now, as social media continues to grow and the pressure for IA reps and BD agents to use social media increases, it is important to know and understand these regulations. This article will outline the current federal guidance issued by the SEC and FINRA for social media use by BD agents and IA reps, discuss some of the industry concerns with the regulation of social media use, and give a glimpse of what the future holds for the use of social media in the securities industry. It is important to note that this article will deal only with the federal regulations surrounding IA reps and BD agents. However, with the passage of Dodd-Frank Act state securities regulators are beginning to issue regulations as well. 4 I. Current Federal Guidance The SEC’s jurisdiction over BD agents comes from the Securities Exchange Act of 19345 (’34 Act); the purpose of which was to ensure that buyers of securities receive complete and accurate information before they invest.

The Advisers Act of 19406 (Advisers Act) gave the SEC jurisdiction over IA reps. It was passed in 1940 in order to monitor those who, for a fee, advise people, pension funds, and institutions on investment matters. BD agents are also regulated by the FINRA.7 FINRA is a private

corporation that acts as a self-regulatory organization which oversees brokerage firms and works to protect investors by promoting market integrity. When a firm provides both brokerage and investment advisory services, it is required to adhere to both the federal securities laws and FINRA applicable rules. The first section below discusses the guidance issued by the SEC and applies to all IA reps covered by the SEC.8 The second section outlines the FINRA guidance and is authoritative for BD agents.

A. SEC Guidance for Investment Advisers In 2012, immediately following the LinkedIn scam, the SEC’s office of Compliance Inspections and Examinations (OCIE) published a National Examination Risk Alert titled, “Investment Advisers Use of Social Media”9 (National Risk Alert). The National Risk Alert outlines the SEC’s concerns about the use of social media by registered IA reps.

In the National Risk Alert the SEC states, the use of social media can implicate rule 206(4)-1 under the Advisers Act, which governs advertisements by IA reps. Paraphrased, this rule provides that an IA rep will violate the anti-fraud provisions of the Advisers Act if it distributes an advertisement that: (1) refers, directly or indirectly, to a “testimonial of any kind” concerning the IA rep, or advice it provides; (2) refers, directly or indirectly, to past specific recommendations of the IA rep; (3) represents that a graph, chart, or formula can be used to determine which securities to buy, without proscribed disclosures; (4) contains a statement to the effect that a service will be furnished free of charge; or (5) contains any untrue statement of a material fact or that is otherwise false or misleading.10 Since the SEC defines “advertisement” broadly,11 it can reasonably be concluded that the anti-fraud portions of the Advisers Act apply to all kinds of social media communications—blogs, wikis, photo and video sharing, podcasts, Twitter, Facebook, etc.

concerned with the use of social media by IA reps: compliance policies and procedures, third-party content, and recordkeeping.12 First, the staff expresses concern with the compliance procedures that firms have in place and their specificity. The staff is concerned that many firms have overlapping procedures that apply to advertisements, client communications, or electronic communications generally, but may not specifically include social media use. This lack of specificity could cause confusion as to what applies to social media use. The staff highlights the following concerns and urges IA reps to evaluate the effectiveness of their compliance programs with respect to these issues: •

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Usage guidelines. Firms may consider creating usage guidelines and adding restrictions and prohibitions in high risk situations.

Content standards. Firms should consider procedures for when content implicates a fiduciary duty.

Monitoring. Firms need to

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consider monitoring systems of not only their own site, but third party sites.

Frequency of monitoring. A firm should consider the volume of an IA reps usage when determining a monitoring system.

Approval of content. IA reps should consider pre-approval of communications, rather than after-the-fact reviews.

Firm resources. Firms need to address whether an IA rep has adequate resources to monitor personnel.

Criteria for approving participation. Firms should take a holistic look at a social networking site when analyzing the risk exposure in their approval process.

Training. Firms should train IA reps on the risks involved in social media postings.

Certification. Consider procedures that require personnel to certify that they understand and will comply with social media policies.

Functionality. IA reps should Continued on Page 20 

The SEC staff identifies three separate areas in the National Risk Alert where they are Nashville Bar Journal - November 2013

9

Feature

Health Care Reform In America: The Good, the Bad and the Ugly by:

Jerry W. Taylor

Introduction As we prepare for the roll out of the Patient Protection and Affordable Care Act—whether with trepidation or optimistic anticipation—it may be instructive or at least insightful to examine past attempts at major health care reform in the United States. Every American presidential administration following the end of World War II has, to some extent, proposed or supported changes to the health care system in this country.

This is not the first time the nation has debated controversial health care reform proposals. This is not the first time bitter partisan politics have complicated, and sometimes obfuscated, attempts at reform. Some attempts at health care reform have been good, some have been bad, and the political process has nearly always being ugly.

The Truman Administration (1945-1953) The first attempt at health care reform in the post-war era occurred during the administration of President Harry S. Truman. His predecessor Franklin D. Roosevelt did little to advance the cause, and health care accessibility was one of the few societal needs not addressed in the New Deal programs. There is evidence President Roosevelt intended to pursue some form of health care reform after the end of World War II, but he died before then, in April 1945.

President Truman recommended to Congress a proposal known as the Wagner-Murray-Dingell bill consisting of nine goals to be achieved over a ten-year period. Universal health insurance coverage, administered and paid for by a National Health Insurance Board, was third down the list of priorities. The first two priorities were increasing the number of medical practitioners—primarily doctors and nurses—and increasing hospital expansion and construction. Opponents of the proposal, including the American Medical Association, decried it as “socialized medicine” and the bill died in Congress.

Truman made a second effort at health care reform in 1948, following his re-election, but the outbreak of the Korean War proved to be the death knell of the proposal.

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The Truman administration’s efforts were not all for naught, however; the third priority of Wagner-MurrayDingell, increasing the number of hospitals in the U.S., was achieved. The Hospital Survey and Construction Act of 1946, (commonly known as the Hill-Burton Act), was passed by Congress in 1946. The law provided federal grants and loans to build, expand and modernize hospitals. In the first six months of the program, grants were approved for 347 hospital projects, adding 11,346 new hospital beds at a cost to the federal government of $160,734,258.1 In today’s dollars, adjusted for inflation, that amounts to over $1.3 billion.2 The consequences of the rapid and un-regulated growth in health care facilities would require future legislation to bring it under control.

The Eisenhower Administration (1953-1961) With its focus on the emerging Cold War, the Eisenhower administration supported only limited health care reform proposals. In 1956 the “Military Medicare” program was enacted, providing payment for health care services for military dependents.3 The administration supported the Forand bill, which would provide health insurance for Social Security beneficiaries. Despite support from the AFL-CIO, the Forand bill never gained much traction in Congress.

The Kennedy Administration (1961-1963) The Kennedy administration pursued a more modest form of health care coverage than that proposed in the Wagner-Murray-Dingell bill. Under the King-Anderson bill coverage would be limited to those 65 years of age and older, and be part of the Social Security benefits package. In so doing, Kennedy laid additional blocks to the foundation of what would ultimately become Medicare.

Frustrated by the efforts of “special interests” to kill the proposal, President Kennedy took his case on the road directly to the public. On May 20, 1962, a series of 33 public rallies were simultaneously held in various parts of the country. The President made a personal appearance and a nationally televised speech at the largest of those – Madison Square Garden in New York City with 17,500 attendees inside and a crowd estimated at 2,500 in standing room only outside the arena.4 In a speech at the rally, President Kennedy confidently predicted the King-Anderson bill would pass Congress “this year, or as inevitably as the tide comes in, next year.”

He was wrong. Opposed by the powerful A.M.A. and with help from conservative Democrat Wilbur Mills, Chairman of the House Ways and Means Committee, the bill was defeated in Committee. President Kennedy did not live to see the proposal’s chances through the following Congress, and the mantel was passed to Lyndon Johnson.

The Johnson Administration (1963-1969) Lyndon B. Johnson won a landslide victory to be elected to a full term as president in November, 1964. The concurrent Senate and House of Representatives races were virtual Democratic sweeps, giving the Democrats a super-majority in both houses,5 and President Johnson a receptive body for the extensive social reforms he dubbed the Great Society.

It covered health care services provided by hospitals, physicians, nursing facilities and home care providers. As of 2012, there were approximately 40.5 million Medicare beneficiaries.8 As of 2009, there were approximately 62 million Medicaid beneficiaries.9 It would not be long before proposals for health coverage for those not covered under Medicare/Medicaid would surface.

The Nixon Administration (1969-1974) In 1971, the Nixon administration proposed the National Health Insurance Standard Act. The proposal called for government-prescribed minimal levels of insurance coverage, mandated to be provided through employers and financed by payment of premiums by employers and employees. This plan would maintain competition between private insurers and expand coverage. The NHISA would also provide government subsidies for premiums for certain employees.

A competing proposal was advanced by a familiar Nixon nemesis, the Kennedys; this time it was Sen. Edward M. Kennedy of Massachusetts. Kennedy introduced the Health Security Act, calling for a single federal payor, providing comprehensive health coverage for nearly all Americans.

Although the Health Security Act never advanced far in Congress, it was the beginning of a career-long effort by Sen. Kennedy at major health care reform.10

Despite continued vocal opposition from the A.M.A. and some conservative Republicans,6 the Medicare and Medicaid legislation steam-rolled through Congress.

It was introduced in the House Ways and Means Committee in March of 1965, gained final approval by the Senate on July 28, 1965 and was signed into law by President Johnson on July 30, 1965.7

While the NHISA did not pass, Nixon was successful in gaining passage of the Health Maintenance Organization Act of 1973, which laid some of the ground work for managed care. Also enacted during Nixon’s term of office were relatively minor amendments to the Medicare program, expanding coverage to certain recipients of Social Security disability benefits and to individuals with end-stage renal disease.11

As originally enacted, the Social Security Amendments of 1965 provided health care coverage to those 65 years of age and older, and to the poor, blind and disabled.

The Ford Administration (1974-1977) The abbreviated Ford presidency was consumed by healing the nation’s postWatergate wounds (“our long national

nightmare” as President Ford termed it), and fighting run-away domestic inflation.

The unrestrained and federally incentivized growth of health care facilites, ushered in by Hill-Burton in 1946, and exacerbated by the infusion of vast federal funds into the health care payment system, were seen as contributing causes to medical inflation. The National Health Planning and Resources Development Act of 1974 (HPRDA) was an effort to reign in escalating health care costs.

The HPRDA called for local health resource planning within federally designated health planning areas across the country. The goals were to reduce and avoid unnecessary duplication of facilities and services, provide for a rational allocation of needed health care services, and facilitate equal access to quality care at reasonable cost. The HPRDA essentially mandated Certificate of Need (CON) programs in the states. Although the CON mandate of the HPRDA was repealed in 1986, thirty-six states, including Tennessee, and the District of Columbia operate CON programs today.12 The Carter Administration (1977-1981) Jimmy Carter campaigned for president calling for national health care insurance with universal coverage, and as president he went to work to prepare a legislative proposal for the same. The American Hospital Association endorsed the concept in principle, but had reservations about any system that took a universal, “one size fits all” approach. The details of President Carter’s plan never received much of a congressional or public audience, as a deep recession and other economic issues took priority.

Other than the tepid support of the A.M.A., little other health care industry or public support was apparent. President Carter later maintained he had strong support from the chairmen of the House and Senate committees with responsibility for Continued on Page 18 

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NBA Annual Meeting & Banquet SUMMARY

On December 5, 2013, at the Wildhorse Saloon in downtown Nashville, there was more than enough collegiality to go around at the Annual Meeting & Banquet of the Nashville Bar Association. With the evening underway, Executive Director Gigi Woodruff, as in past years, welcomed all in attendance thanking especially the major sponsors – year-round Title Sponsors SunTrust (Kent Moegerle and James Greek), IPSCO (Pam McGrath), and Banquet Sponsors, Neal & Harwell (Bill Ramsey) Document Solutions, Inc. (Lisa Kimbrell & Justin Moses) and Thomson Reuters (David Martin). The NBA Staff was thanked for their hard work throughout the year, Program and Events Coordinator Traci Hollandsworth was recognized for her role in the production of the banquet, and the officers and board members were thanked for their efforts and sacrifices throughout the year. Treasurer Trace Blankenship, succinctly stated what all wanted to hear; we made more money than we spent.

Retiring board members were recognized and thanked including Pat Moskal, 1st Vice President, John Tarpley, 2nd Vice President, John Kitch, Immediate Past President, Bob Boston, Dawn Deaner, Michele Johnson, Treasurer Trace Blankenship, and Secretary Cornell Kennedy.

The awards were then presented.

YLD Enterprise Award Lauren Kilgore

YLD President’s Award Taylor Sutherland

2013 Emeritus Award Winners

(presented attorneys who have participated as members of the Nashville Bar Association for 50 years) Robert Ballow C. Hayes Cooney Lewis Conner, Jr. John G. Doak, S.R. Gordon William Lassiter, Jr. Jack Robinson, Sr.

Nashville Bar Journal Awards

Contributor of the Year: Bart Pickett Article of the Year: Matt Pulle for his article titled “Bank on It: Though a Work in Progress, The National Mortgage Settlement is Helping Tennesseans Keep Their Homes” that ran in the July issue.

CLE Award Karl Warden

Volunteer of the Year Award Steve Cobb

Pro Bono Leadership Award Ortale Kelley Herbert & Crawford

360 Award

Culwell Ward for his 30 years of service.

Ward was the first Volunteer of the Year in 1984, recognizing a full circle of service for Cully and the Nashville Pro Bono Program.

President’s Awards

Presented by outgoing President Tom Sherrard to Robb Bigelow, 2013 YLD President Jessie Ziegler & Ken Bryant, Co-Chairs of the NBA Federal Court Committee

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John C. Tune Community Service Award

(recognizing the highest degree of dedication as lawyer and for the betterment of the community) Byron Trauger. Bob Tuke presented the award to Byron and had these kind words to say: Byron Trauger is known as a successful member of the bar – a healthcare lawyer, a litigator, and a consigliore – the guy you go to when you need help fixing a complicated problem.

He’s known to be someone whose word is his bond, who fights hard for his clients, but who is a gentleman – someone who has earned deep friendships with his fellow lawyers.

As for his civic contributions, the list is long: the PENCIL Foundation, Nashville Public Radio, the Governor’s Books from Birth Foundation, West End United Methodist Church, the Land Trust for Tennessee, and Martin Methodist College. And that is just the list of organizations he has chaired. Additionally, he has served on the boards of Nashville Public Television, the Tennessee State Museum Foundation, Nashville Children’s Theatre, Tennessee Repertory Theatre, the Tennessee Environmental Council, and Historic Nashville, and he currently serves on the boards of the Nashville Public Education Foundation, SuccessPAC, the Public Library Foundation, and You Have the Power.

The John C. Tune Award, the highest award bestowed by our bar, was actually the brainchild of former Presiding Judge Robert Brandt, who now practices with Trauger and Ed Yarborough when he was NBA President. The Tune Award recognizes those among us who make outstanding contributions as lawyers and as citizens.

Trauger has done both.

As his final act as president, Tom Sherrard introduced Charles Grant, as the next President of the Nashville Bar Association.

Grant then recognized the newly elected 2014 board members: Hon. Joe Binkley, Irwin Kuhn, Claudia Levy, Sara Reynolds, Nathan Ridley and Bernadette Welch, as well as the new Officers for 2013: General Counsel Gareth Aden, Secretary Stacey Billingsley Cason, Treasurer Nicole James, 2nd VP/Membership John McLemore, 1st VP/Governance Dewey Branstetter, and President-elect Ed Lanquist.

May 2014 be the year for competency and collegiality from every member of the Nashville Bar Association next year! n Nashville Bar Journal - November 2013

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BIL L G A & PH DG ET O IL'S F THE

MONTH

Tech Titans Face Off With Latest Gadgets Microsoft's Surface Pro 2 vs. Apples' iPad Air

By: Bill Ramsey, Neal & Harwell, PLC and Phillip Hampton, LogicForce Consulting We recently took a road trip to Reno to speak at the Region 6 ALA Conference. The trip proved to be a good test drive for two brand new tech gadgets (Well, anything over $500 is not really a gadget is it? It's an investment.) Phil had his new Microsoft Surface Pro 2 in tow; and Bill insisted on getting up early on the day of the presentation to drive out to the Reno Best Buy for the iPad Air that went on sale that day. With both of us geeks totally enthralled with our new "toys", the weekend roundtrip to Reno was a constant back-and-forth on the relative merits of our newest devices. It was a classic battle...Microsoft vs. Apple…Bill vs. Phil…a Geek-o-rama Cage Match. There were no knockouts, but each of us got in some good shots. Here are the highlights.

with a new, faster processor, much-improved battery life, and even a stylistic change that we really like, a two-position built-in kickstand designed to make the Surface more comfortable when holding in your lap. Yes it is a little heavy as tablets go, but light as laptops go. If you don't want to carry both a tablet and a laptop, the Surface Pro 2 is clearly the way to go.

Phil purchased the second generation of Microsoft's debut into the tablet market, the simply-named Surface Pro 2, not long after the late October launch. Just like the first generation, Microsoft has two basic models of the new device, a consumerfocused Surface 2 (formerly known as Surface RT) and the professional model, the Surface Pro 2. The Pro model is the one we highly recommend for business professionals. The real advantage of the Surface Pro2 over other tablets (both iOS and Android based) is that it is running a fully functional Windows 8.1 operating system on a business class Intel processor. So the user experience on the Surface Pro 2 is akin to what you would get with a professional-grade laptop. The Windows 8.1 update that Microsoft rolled out in Q3 2013 was a great step forward into making Windows 8 a business-friendly interface. It more seamlessly blends the Microsoft touch-enabled app interface (formerly known as Metro) with the backend Microsoft desktop interface that we all know and love.

There is no doubt about it, the iPad Air is a beautiful work of art. It is noticeably thinner and lighter than its predecessors, and yet the viewable screen size is larger. How does Apple do it?

Bill got the 128 GB Wi-Fi version in white (because the store didn't seem to have any charcoal-colored iPads in stock). Setup was a breeze and in a no time, the iPad was connected to iCloud and pulling down his settings. We both had already upgraded existing Apple devices to iOS7, so the new iOS7 interface that comes pre-loaded on iPad Air was no surprise. What was new, however, was the zippy speed of the A7 processor in the Air, and the beautiful, artful form factor. This is where Apple really shines. They make really sexy devices, and the iPad Air is just that, sexy, slick and fast. Bill loves the new iOS7 and, although some of his older apps don't seem to have iOS7-compliant updates ready yet, for the most part, the user experience is greatly enhanced. iPad owners everywhere will love the new iPad Air, however, the question remains whether they will be willing to cough up the hefty price for a thinner version of the iPad 4 that is only marginally better with no major new features (outside a much-improved built-in camera).

In our view, the advantage of the Surface over other consumerbased tablets (iPad Air included) is still the fact that you can run both inexpensive productivity and entertainment apps from the Microsoft Store along with all of the desktop applications that you use on a daily basis at the office. It truly is the best of both worlds. Now with the Surface Pro2, that experience is enhanced

While Phil was preening over his new Surface Pro2, however, Bill was anxiously awaiting the release of Apple's much-anticipated fifth generation iPad, the iPad Air. The release date coincided with the date of our presentation at the Region 6 Conference in Reno, so Bill had to snag one of the first available iPad Airs before we headed to the GSR for the conference.

On the flight home from Reno, we unknowingly illustrated the relative strengths of our new gadgets. Phil had a Monday deadline for some training materials that he was drafting and Continued on Page 15 

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Helping Nashville Artist Continued from page 7

from critics in The New York Times and The Wall Street Journal.

Ideas to Save Money and Improve Tennessee Court Systems Continued from page 14

was working comfortably in economy-class seating with his Surface Pro 2 air, Bluetooth mouse, connected to the internet via the plane's Wi-Fi signal. He was working on multiple Microsoft Word documents, browsing internet pages in multiple IE tabs, listening to his favorite tunes via the Windows 8 Music app, and occasionally checking the Nashville weather via the snazzy weather app from the Microsoft Store. In other words, he had access to everything that he normally uses in office right there on the Surface Pro 2. On the other side of the aisle, Bill had completed all his work for the weekend and was blissfully browsing the internet, listening to music, and playing games on the stunning retina display of his brand new iPad Air. We even caught people sneaking a peek at the new Air as they went down the aisle to their seats, clearly the envy of the plane. In one snapshot, we see both devices serving their masters dutifully; and both masters were supremely pleased.  See you next month, —Bill & Phil

Lawyers who want to get involved with VLPA and give back to the arts community can find opportunities to expand their areas of expertise and client bases.

Lawyers from all practice areas are needed and invited to join as VLPA clients need help with a wide range of legal issues. By joining the VLPA volunteer roster, lawyers are simply agreeing to be contacted by a VLPA staff member with a potential case.

If that lawyer cannot handle the case at that time, VLPA contacts another volunteer until the case has been accepted and then connects the client with the volunteer at that point. Most volunteers are contacted once or twice a year and projects average about ten hours of work (over the course of several weeks). Interested lawyers can join VLPA at www.abcnashville.org/ volunteer-for-vlpa/.

Nashville cares about the arts – and so do your fellow Nashville attorneys. But there is a present need at VLPA for more volunteer lawyers to help serve the legal needs of the city’s rapidly expanding artistic community. Wouldn’t you like to find your own unique way to contribute to Nashville’s cultural capital and artistic community? It’s easy – just contact Casey at VLPA. A simple email or phone call is all it takes to make the transition from a lawyer who merely appreciates the arts to a lawyer who actually supports the arts.  Casey Gill Summar is the Executive Director of the Arts & Business Council, where she oversees the organization including the Volunteer Lawyers & Professionals for the Arts program.

Casey co-founded this program as the Tennessee Volunteer Lawyers for the Arts (TNVLA) in 2006, serving as its Executive Director until merging TNVLA with the Arts & Business Council in 2009. She also serves as an adjunct Professor of Law at Vanderbilt University Law School, Peabody, and Belmont Law. Casey received her J.D. with honors from Vanderbilt University Law School and graduated magna cum laude from Belmont University with a B.F.A in Photography.

Nashville Bar Journal - November 2013

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Michael Abelow Sherrard & Roe, PLC Elizabeth Alexander Lieff, Cabraser, Heimann & Bernstein

Brigid Carpenter Baker, Donelson, Bearman, Caldwell & Berkowitz, PC Brian Carroll Tennessee Department of Transportation

Mollie Gass, Esquire Jon Gaston Waller Lansden Dortch & Davis, LLP

Catherine Caster, Esquire

Hon. Hamilton Gayden First Circuit Judge, Circuit Court of Davidson County

Anne Arney Bone McAllester Norton PLLC

Kay Caudle Smith Travel Research, Inc.

Paul Gontarek Howard Mobley Hayes & Gontarek, PLLC

Josh Baker Tennessee Department of Labor and Workforce Development

Matthew Claiborne Bridgestone Americas, Inc.

James H. Harris Harris Martin Jones, P.A.

Hon. Frank Clement Tennessee Court of Appeals Judge, Middle Section

Jonathan Harris Ogletree, Deakins, Nash, Smoak & Stewart, P.C.

Yarnell Beatty Tennessee Medical Association

Bryce Coatney Tennessee Department of Commerce and Insurance

Hon. William Haynes Chief District Court Judge, U.S. District Court, Middle Tennessee

Michael Begley Tennessee Department of Transportation

Christopher Coleman Tennessee Justice Center

Henry Hildebrand, III Lassiter, Tidwell & Davis, PLLC

Beth Seigenthaler Courtney Seigenthaler Public Relations

Elisha Hodge Office of the Comptroller of the Treasury

Richard "Dick" Cowart Baker, Donelson, Bearman, Caldwell & Berkowitz, PC

Barbara Holmes Harwell Howard Hyne Gabbert & Manner, P.C.

Alexander Davie Riggs Davie, PLC

Heather Hubbard Waller Lansden Dortch & Davis, LLP

John Day Law Offices of John Day, P.C.

Margaret "Marnie" Huff Margaret Huff Mediation

Jim Doran Waller Lansden Dortch & Davis, LLP

Mark Ison Sherrard & Roe, PLC

John Duval Tennessee Council of Conflict Mediation

Jesse D. Joseph Tennessee Department of Commerce and Insurance

Kristen Amonette Lindsey & Amonette PLLC

Hon. Elaine Beeler Clerk & Master, Chancery Court of Williamson County

Hon. Joe Binkley, Jr. Fifth Circuit Court Judge of Davidson County Robert Blagojevich Hon. Claudia Bonnyman Part I Chancellor, Chancery Court of Davidson County Hon. Larry Brandon General Sessions Judge, Part III of Rutherford County Leslie Bridges Office of the Attorney General and Reporter Hon. Thomas Brothers Sixth Circuit Judge, Circuit Court of Davidson County Hon. John Bryant US Magistrate Judge, U.S. District Court, Middle District of Tennessee David Callahan Callahan Witherington PLLC Jason Callen Walker, Tipps & Malone, PLC Donald Capparella Dodson Parker Behm & Capparella, P.C.

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Nashville Bar Journal - November 2013

George Duzane Duzane, Kooperman & Mondelli Samuel Edwards Greater Nashville Regional Council John Farringer Sherrard & Roe, PLC Hon. Mark Fishburn Division VI Judge, Criminal Court of Davidson County J. Brooks Fox Metropolitan Department of Law Lora Barkenbus Fox Metropolitan Department of Law

Hon. Randy Kennedy Seventh Circuit Judge, Circuit Court of Davidson County John Kitch John D. Kitch, Attorney Janet Kleinfelter Office of the Attorney General and Reporter Irwin Kuhn Dobbins, Venick, Kuhn & Byassee, PLLC Edward "Ed" Lanquist, Jr. Waddey & Patterson, P.C.

The Nashville Bar Association gratefully acknowledges the following CLE seminar presenters and producers who generously shared their knowledge, skills and expertise with our legal community.

Their efforts are significant in supporting NBA’s mission to advance the education of the bar.

Eric Larsen Papa & Roberts, PLLC

Nathan Ridley Bradley Arant Boult Cummings LLP

Taylor Sutherland Rocky McElhaney Law Firm, PC

Ramsey "Bart" Leathers, Jr. Bureau of TennCare

Hon. Phillip Robinson Third Circuit Court Judge, Circuit Court of Davidson County

Josh Thomas State Comptroller of the Treasury's Office

Ralph Levy, Jr. Dickinson Wright PLLC Michelle Long Tennessee Department of Health Hon. Ellen Hobbs Lyle Part III Chancellor, Chancery Court of Davidson County Alexandra MacKay Stites & Harbison, PLLC Cassandra Mahoney Tennessee Department of Environment & Conservation Charles Malone Walker, Tipps & Malone, PLC Anne Martin Bone McAllester Norton PLLC Peggy Mathes Hiland, Mathes & Urquhart Nathan Mauer Tennessee Department of Mental Health & Substance Abuse Services Hon. Amanda McClendon Second Circuit Court Judge, Circuit Court of Davidson County Hon. Carol McCoy Part II Chancellor, Chancery Court of Davidson County Jeff Mobley Howard Mobley Hayes & Gontarek, PLLC

John Rowland Baker, Donelson, Bearman, Caldwell & Berkowitz, PC Jennifer Rusie Ogletree, Deakins, Nash, Smoak & Stewart, P.C. Marissa Moses Russ MTR Family Law, PLLC

Christopher Thorsen Bradley Arant Boult Cummings LLP Ty Thornton Tennessee Department of Mental Health & Substance Abuse Services Hon. Aleta Trauger District Judge, U.S. District Court, Middle District of Tennessee

Rick Sanders Aaron Sanders PLLC

Brigitte Tubbs-Jones Tennessee Department of Human Resources

Kimberly Schreiber Mount Juliet Law, PLLC

Kimberly Vance Baker, Donelson, Bearman, Caldwell & Berkowitz, PC

David Shearon Thriving Lawyers Jennifer Sheppard Martin Heller Potempa & Sheppard, PLLC Blaine Smith Bass, Berry & Sims PLC Caitlin Doty Smith Office of the Attorney General and Reporter Carolyn Smith Office of the Attorney General and Reporter Eileen Burkhalter Smith Tennnessee Board of Professional Responsibility Gregory Smith Stites & Harbison, PLLC

James Vick Tennessee Board of Professional Responsibility Kathryn Hannen Walker Bass, Berry & Sims PLC Karl Warden Law Office of Karl Warden John P. Williams Tune, Entrekin & White, P.C. Brian Winfrey The Winfrey Firm Michele Wojciechowski Tennessee Supreme Court Todd Woods Nissan North America Inc.

Marlene Eskind Moses MTR Family Law, PLLC

Hon. Philip Smith Fourth Circuit Court Judge, Circuit Court of Davidson County

Benjamin Papa Papa & Roberts, PLLC

Morgan Smith Law Office of Morgan Smith

Edward "Ed" Yarbrough Bone McAllester Norton PLLC

Hon. Russell Perkins Part IV Chancellor, Chancery Court of Davidson County

Hon. Carol Soloman Eighth Circuit Court Judge, Circuit Court of Davidson County

Michael Yopp Waller Lansden Dortch & Davis, LLP

Matt Potempa Martin Heller Potempa & Sheppard, PLLC

Eric Stevens Littler Mendelson, P.C.

Tara Presnell Littler Mendelson, P.C.

Conor Sullivan The Law Firm of Conor F. Sullivan, PLLC

Heather Wright Bradley Arant Boult Cummings LLP

Stephen Zralek Bone McAllester Norton PLLC

Nashville Bar Journal - November 2013

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Health Care Reform In America: The Good, the Bad and the Ugly Continued from page 11

health care legislation, and could have succeeded in passing his proposal had it not been for the abrupt withdrawal of support by one of those chairmen. Ironically, the vacillating Senate committee chairman was none other than Sen. Edward M. Kennedy.13 (Senator Kennedy was to run against Carter for the Democratic presidential nomination in 1980.)

The Reagan Administration (1981-1989) In his inaugural address, after lamenting the consequences of excessive government borrowing and deficit spending, President Reagan declared: “In this current crisis, government is not the solution to our problem. Government is the problem.”

There were no administration proposals for new government run or administered health care programs under President Reagan.

During President Reagan’s term of office several new laws were enacted aimed primarily at reducing the growth in federal spending on health care, and improving efficiencies. This was to be accomplished by changing Medicare reimbursement methodologies—in most cases reducing reimbursement to hospitals and physicians-and stepping up anti-fraud measures.

But the Reagan Administration also advanced through Congress the first major expansion of Medicare benefits: the Medicare Catastrophic Coverage Act of 1988 (MCCA). The law expanded Medicare coverage for outpatient drugs, put a ceiling on out of pocket co-pays for hospital and physician services, and modestly expanded payments for long term care.

The program was to be funded entirely by Medicare beneficiaries through increased premiums, and a surtax on wealthier beneficiaries based on income.

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The George H.W. Bush Administration (1989-1993) President George H.W. Bush inherited a political catastrophe in the Medicare Catastrophic Coverage Act of 1988.

Among the elderly there was wide-spread disappointment over the level of expanded benefits and strong resentment over having to pay higher premiums and taxes to fund it.14 These sentiments led to a senior revolt against the law, and in 1989—just 17 months after it was enacted—a bipartisan effort in Congress repealed most of the MCCA. President Bush’s agenda for health care legislation consisted of additional measures to reduce the growth of federal health care spending and reduce fraud and abuse in the Medicare and Medicaid programs. Notable among the enactments in the Omnibus Budget Reconciliation Act (OBRA) of 1989 were changes in Medicare physician payments from a charge-based system to the Resource Based Relative Value Scale (RBRVS), and a prohibition on physician “self-referrals” for clinical laboratory services (Stark I).

The Clinton Administration (1993-2001) Bill Clinton was the first Democrat elected president in 12 years, and his administration wasted little time in proposing major health care reforms. After the release of a report by a highly controversial task force headed by First Lady Hillary Clinton, President Clinton sent the American Health Security Act of 1993 (AHSA) to Congress. It proposed to provide affordable health insurance for all through a concept called “managed competition.”

Health insurance coverage would be provided through private insurers competing for customers in a highly regulated market, overseen and coordinated by regional health alliances to be established in each state. All health plans would be required to provide a minimum level of benefits.

Employers would be required to provide insurance coverage for their employees and pay 80% of the premium.15

The AHSA was opposed by much of the health care industry and the health insurance industry. It was subjected to bitter partisanship in Congress, with even Democratic lawmakers split and some offering alternative or compromise plans.

By September 1994, the proposal was declared dead by Senate Majority Leader George Mitchell.16 Other important health care reform measures were enacted during President Clinton’s term of office.17 Among the notable reforms was The Health Insurance Portability and Accountability Act (HIPAA), which greatly improved the continuity or “portability” of health insurance plans, and authorized the promulgation of regulations protecting the privacy of health records, now the hallmark of HIPAA. The Stark physician self-referral law was significantly expanded to cover additional clinical services, and extended to cover Medicaid as well as Medicare (“Stark II”). The State Children’s Health Insurance Program (SCHIP) was created, providing federal matching funds for pooled risk health insurance coverage for families of modest income with children.

The George W. Bush Administration (2001-2009) President George W. Bush bore the burden of being President during the tragedy of 9-11. Much of his presidency, especially his first term, was consumed with the aftermath of that and the war on terrorism at home and abroad. It is understandable that health care reform was not at the top of his agenda for many practical as well as political reasons.

President Bush’s domestic legacy does, however, include one of the largest expansions of Medicare in the program’s history.

The Medicare Drug Improvement and Modernization Act of 2003 (MMA) made numerous changes to the Medicare program, the most important of which is the prescription drug coverage benefit, created as Medicare Part D. Continued on Page 23 

Congratulations

Waddey & Patterson Managing Shareholder

Edward Lanquist, Jr. On your Election as 2014 President-Elect Nashville Bar Association

Simply the best!

PYA salutes colleague Carol Carden on her induction into the American Institute of Certified Public Accountants’ Business Valuation Hall of Fame. This honor recognizes lifetime achievements and contributions that significantly advanced the valuation discipline.

As a Principal at PYA, Carol provides valuation and consulting services to a variety of organizations, primarily in the healthcare industry.

She has been recognized for her leadership, accomplishments, professionalism, service orientation, humility and compassion for others—attributes we see in her every day.

Congratulations, Carol, from your PYA family!

30

th

1983•2013

ANNIVERSARY

800.270.9629 | www.pyapc.com Nashville Bar Journal - November 2013

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#SecuritiesViolation: How Social Media Use Affects Investment Advisers and Broker Dealers Continued from page 9

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consider the functionality of social media sites approved for use, including the continuing obligation to address any upgrades or modifications.

Personal/professional sites. Firms should consider whether to adopt policies to address business conducted on a personal or third-party media sites.

Information security. Firms should consider placing firewall restrictions between social media sites and certain personal information because of security risks.

Enterprise-wide sites. IA reps that are part of a larger financial enterprise may consider creating usage guidelines to prevent the advertising practices of a firmwide social media site from violations of the Advisers Act.13

Second, the SEC addressed concerns with third parties posting on IA reps’ social media sites and the compliance issues that could accompany such postings. The issues arise when firms allow third parties to post messages, forward links, and post articles on the firm’s social media site or one of the IA reps’ personal sites. The staff noted its concern about direct or indirect testimonials of any kind being posted on a social media site. The definition of testimonial content is broad and the SEC notes that even hitting a “like” button on an adviser’s Facebook page could be a prohibited testimonial if the “thumbs up” represents an explicit or implicit statement of a client’s experience with an IA rep.

The third area of concern is the recordkeeping obligations of IA reps. The staff explicitly states that the recordkeeping obligation does not differentiate between traditional paper communications and communications via social networking sites. All communications that relate to the advisers’ recommendations or advice must be easily accessible for a three year period. The form of the communication is not a factor in how long the record needs to be retained. The staff recommends that 20

Nashville Bar Journal - November 2013

retention of communications be a pivotal factor in determining social media usage procedures.

In summary, the SEC guidance highlighted concerns with compliance programs, third-party content, and recordkeeping obligations. Each of these issues must be considered in light of the substance of the communication and not the form, in order to properly comply with federal securities laws.

B. FINRA Regulations for BrokerDealers In January 2010, FINRA issued Regulatory notice 10-06.14 It provides guidance on the application of FINRA rules governing communications with the public to social media sites and reminding firms of the recordkeeping, suitability, supervision and content requirements for such communications. To supplement this initial notice and answer questions which were left open-ended, FINRA issued Regulatory Notice 11-39.15 Regulatory Notice 11-39 provides guidance to member firms on social networking websites and business communications.

In order to understand the FINRA guidance it is important first to understand the distinction between static and interactive content. Since the age of the internet chat room, FINRA has taken the position that participation by a registered BD agent in an interactive internet forum is comparable to a presentation made to a group of investors and, accordingly, is subject to the same rules applicable to presentations.16 FINRA codified this position by amending National Association of Securities Dealers (NASD) Rule 221017 to include the participation in an interactive electronic forum in the definition of “public appearance.”

This rule indicates that all communications must satisfy content standards and specifically, that all communications should be founded on fair dealing and good faith in order to “provide a sound basis for evaluating the facts in regard to any particular security or type of security, industry, or service.”18 FINRA rules also do not require

firms to have a registered principal approve in advance the remarks of personnel who make a public appearance.19 Hence, FINRA rules do not require prior approval of postings by BD agents on interactive electronic forums.

Static communications or postings on the other hand, are regulated as “advertisements.” Regulatory Notice 10-06 specified that “static content remains posted until it is changed by the firm or individual who established the account on the site . . . and is accessible to all visitors to the site.”20 When something is regulated as an “advertisement” under NASD Rule 2210, a BD agent must obtain prior principal approval of any posting.

When applying this standard, it is important to recognize that a social media site may combine static and interactive communications. Static communications are the areas that remain unchanged, until changed by the firm (Facebook status updates, biographical information section, etc.) This communication is treated as an advertisement and needs prior approval.

The interactive or non-static communications are the replies, the likes, and the comments posted which have the characteristics of a real-time interaction. These again are treated as public appearances and do not require prior approval. It is worth noting that although the interactive communications do not require prior approval, they still must be supervised.

The FINRA rules also address recordkeeping concerns. Regulatory Notice 11-39 clarified that the posting of any content on a website by a BD agent is a communication under the FINRA rules and, accordingly, is subject to applicable FINRA recordkeeping rules. Therefore, rules 17a-321 and 17a-422 under the ‘34 Act and NASD Rule 3110,23 which require that a BD agent retain electronic communications made by the firm that relate to the firm’s business, apply to a firm’s business communications via social media.

In determining whether an electronic communication relates to a firm’s business

communication, the facts and circumstances, and the context and the contents of the communications must be examined.

The type of device or technology used for the communication has no relevance in the determination and the requirements are the same for both static and interactive electronic communications. Regulatory Notice 11-39 also states that a firm may not use any type of technology that “automatically erases or deletes” electronic communication that would prevent compliance with relevant recordkeeping provisions.

Furthermore, FINRA cautions that ownership of a device does not relieve recordkeeping obligations. Meaning, a firm must be able to retain business records on personal computers, even if personal records may be jeopardized. FINRA suggests using separate personal and business devices.

In regard to suitability, FINRA makes it clear that recommendations for a security through a social media site will trigger the requirements of NASD Rule 2310.24 What constitutes a recommendation will depend on the facts and circumstances of the communication. This becomes very complicated for a BD agent because many social media sites include functions that make their content widely available or that limit access to some individuals. Suitability requirements mandate that a BD agent must determine that a recommendation is suitable for every investor to whom it is made.

Regulatory Notice 11-39 also addresses supervisory requirements. NASD Rule 301025 provides that member firms must establish and maintain procedures to supervise the activities of each registered agent, and that the procedures must be designed to achieve compliance with applicable securities laws and with applicable FINRA rules.26 Basically, if a BD agent wants to use a social media site for a business purpose, FINRA rules require that a registered principal review the site prior to its use. It can only be approved if the

principal determines that the BD agent can and will comply with all applicable FINRA communication rules, federal securities laws, and individual firm policies The last concern addressed by the FINRA guidance is third-party content. Generally, there is no obligation to keep third party posts to firm-hosted social media sites unless the firm “adopts” or becomes “entangled” with the content of those third-party posts. However, FINRA explains that a firm may not establish links to third-party sites that the firm knows, or should know, misrepresents content, and should not do so when there are red flags to that effect.

Apart from posting links, “entangling” or “adopting” third party site information takes place when the firm participates in the development of content on the third party site or if the firm indicates on its site that it endorses the content on the third party site.

To summarize, the FINRA guidance distinguishes between static and interactive communications to determine which rule should apply. It also addresses concerns over recordkeeping, suitability, supervision, and content requirements. All of these concerns should be considered under the specific facts and circumstances of each situation, and like the SEC guidance, the FINRA guidance suggest that every communication be looked at for substance, not form when assessing compliance.

II. Industry Concerns with Regulation of Social Media Use by Broker-Dealers Agents and Investment Advisers Representatives Industry concerns center around one driving factor: money. Each new regulation leads to a new cost and thus, a new concern for industry participants. Specifically, the industry is concerned about the cost of training individuals about new compliance issues, the cost of storing the materials posted on social media, the added risk of SEC, FINRA, or state action being brought against the firm, and the added time crunch associated with approving every social media interaction.

The cost of training in particular is intimately related to most of the other costs.

If firms decide to allow registered representatives to communicate with clients and the public, each representative must distinguish between what information is interactive and static. Then whatever information is static, must be pre-approved by a supervisor. This simple action implicates three separate costs. First, you need to train the representative to identify a static and interactive communication. Second, a registered principle must supervise and approve the static information. Third, if the supervision or the training is insufficient, a firm must deal with the risk of an SEC, FINRA, or state regulatory action.

Moreover, the cost of storage for material posted on social media websites poses a huge problem.27 Because of the interactive nature of social media communications, there can be massive amounts of material posted by any individual person. Firms must keep all of this material for three years, two years of which the information must be easily accessible. Coincidentally, some social media sites automatically delete material before the three required years. This means that if firms decide to allow the use of social media by representatives, they will need to purchase technology which scans and records all social media content. This information must then be stored by a third party data storage center or on in-house servers, both of which have associated costs. While most firms want regulation or guidance on the issue of social media use, regulators must acknowledge these concerns and find a happy medium between protecting the public and hindering the industry.

III. What Comes Next?

Although, it is hard to know exactly what the future holds for how the securities industry will adapt to the use of social media, one certainty is that the states will play a larger role. As mentioned in footnote 4, section 410 of the DoddContinued on Page 22 

Nashville Bar Journal - November 2013

21

#SecuritiesViolation: How Social Media Use Affects Investment Advisers and Broker Dealers Continued from page 21

Frank Act raised the threshold for IA reps who must register with the state to $100 million of assets under management. In practice this translates to all IA reps who are required to register with the state facing stricter scrutiny than their federally registered colleagues. This comes from the volume of people each regulator must examine. States are only responsible for the IA reps and BD agents in their state; the SEC is responsible for all BD agents and IA reps with more than $100 million in assets throughout the 50 States. Thus, the narrower scope of each state’s jurisdiction allows more precise examining.

Currently, most states do not have regulations which specifically address the use of social media by IA reps and BD agents. In Tennessee, for example, there is no guidance or regulation specifically addressing BD agents’ or IA reps’ business communications over social media. However, some states do have regulations applying to communications over the internet. Many of these regulations focus on providing notice to the investor that the information is not specific to each individual investor and ensuring that the IA rep or BD agent follows the same requirements that are expected in regular sales situations. In the states who do not address internet or social media, recordkeeping, disclosure, suitability, and supervision regulations still apply.

It is also important to remember that state regulations can be stricter than the SEC and FINRA regulations. In some instances, regulations from a state regulator may require more than the SEC or FINRA regulations.

There are a few states making steps towards adding specific regulations concerning social media. The most comprehensive of these has come from Massachusetts. Massachusetts issued guidance (MA Guidance) directly after the initial SEC guidance.

28 The MA Guidance contained a survey detailing which IA reps and BD agents use social media and what types of social media they use. It also identified that many firms do not have a plan to comply with regulations in their social media use, even if they plan to use social media extensively.

22

Nashville Bar Journal - November 2013

The MA Guidance echoed many of the guidelines given by the SEC and FINRA, however it is very beneficial for IA reps and BD agents in Massachusetts because it cited the relevant state statutes that apply and clarified ambiguous language in the SEC and FINRA guidance.

Apart from more state regulation, the future is unclear. Some industry officials are calling for stringent standards, while others are embracing the social media phenomenon. As the social media world evolves, it is likely that more states will issue guidance or even industry specific regulation to account for the new forms of technology. In the meantime it is important to stay aware of the regulatory and industry concerns.

IV. Conclusion As technology advances, social media presents both opportunities and risk for the financial services industry. For securities lawyers, IA reps, and BD agents there are four things to keep in mind when utilizing social media: communications, supervision, recordkeeping, and confidentiality.29 For communication, distinguishing between interactive and static will determine the review that needs to be performed and the records that must be kept. Industry participants should also look at the content of the communication, to determine whether it is a testimonial, recommendation, or an inducement. With regards to supervision, IA reps and BD agents should develop procedures to review communications based on a risk analysis, identifying which staff members use social media the most and therefore pose the largest risk.

For recordkeeping, IA reps and BD agents should seek technology which will capture all social media and specify that individuals should maintain one social media site exclusively for personal use and one exclusively for business use. Lastly, remember an examiner expects a customer’s information to be safe. IA reps and BD agents should ensure customer confidentiality by using firewalls and protection software to prevent hacking and the illegal use of client information.

While critics might say that regulation could stifle the widespread adoption of emerging technologies and firms may be tentative about embracing the new technology, ultimately the decision to adopt will be inevitable. Social media is not going away any time soon and as more clarity and definition is provided in the law, firms will begin to use the outlet more and more. Understanding the rules and developing procedures now, can help BD agents and IA reps get a jump on the competition and prosper in the future.30 n Matthew Pierce is a third-year law student at the University of North Carolina and a graduate of the University of Tennessee. Matthew is currently an Editor of the North Carolina Banking Institute Journal and President of the Transactional and Corporate Law Association. His legal education has focused in areas of finance, securities, and banking law. Matthew plans to return to Tennessee to pursue these interests and contribute to the Nashville community.

(Endnotes) Hayley Tsukayama, Twitter Turns 7: Users send over 400 million tweets per day, Wash. Post (Mar. 21, 2013), http://articles.washingtonpost.com/2013-0321/business/37889387_1_tweets-jack-dorsey-twitter.

1

A “#” is used on Twitter, a social media outlet, to group messages and start ad hoc discussion forums.

The word “YOLO” used above stands for “You Only Live Once,” and it implies that one should enjoy life, even if that entails taking risks.

2

Andrew Chow, Man Used LinkedIn for $500B Securities Fraud, FindLaw (Jan. 11, 2012) http://blogs. findlaw.com/blotter/2012/01/man-used-linkedin-for500b-securities-fraud.html

3

Before the Dodd-Frank act, an IA was generally prohibited from registering with the SEC under the Advisers Act if it had less than $25 million of assets under management and instead had to register with the state securities regulator. Under Dodd-Frank, the eligibility threshold was raised to $100 million of assets under management. Now, IAs with less than $100 million of assets under management must register with their state regulator. There is an exception for IAs with between $25 million and $100 million of assets under management, with clients in 15 or more states, that allows them to register with the SEC. The increased threshold means that larger firms are now under state regulation. Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, 124 Stat. 1376, §410 (2010) (codified as amended at 15 U.S.C. 80b-3a(a) (2006)).

4

5

15 U.S.C. §§ 78a et seq. (2012).

6

15 U.S.C. §§80b-1 – 80b-21 (2012).

FINRA, About the Financial Industry Regulatory Authority, http://www.finra.org/AboutFINRA/.

7

IA reps covered by the SEC have more than $100 million of assets under management. See Dodd-Frank Wall Street Reform and Consumer Act, supra note 4.

8

9 Exch. Comm’n, Investment Adviser Use of Social Media, http://www.sec.gov/about/offices/ocie/riskalert-

Health Care Reform In America: The Good, the Bad and the Ugly Continued from page 18 socialmedia.pdf (Jan. 4, 2012) [hereinafter “National Risk Alert”].

10

17 C.F.R. § 206(4)-7 (2013).

U.S. Sec. & Exch. Comm’n, General Information on the Regulation of Investment Advisers, http://www.sec. gov/divisions/investment/iaregulation/memoia.htm (modified Mar. 11, 2011).

11

12

National Risk Alert, supra note 9 at 2.

13

Id. at 4-5.

FINRA, Regulatory Notice 10-06: Social Media Websites, (Jan., 2010), http://www.finra.org/web/ groups/industry/@ip/@reg/ @notice/documents/ notices/p120779.pdf.

14

15 FINRA, Regulatory Notice 11-39: Social Media Websites and the Use of Personal Devices for Business Communications, (Aug. 2011), http:// www.finra. org/web/groups/industry/@ip/@reg/ @notice/documents/notices/p124186.pdf.

Christopher Garcia & Melanie Conroy, Reg FD Alert, Weil, Gotshal & Manges LLP (Dec. 2012) (Client Alert) available at http://www.weil.com/files/upload/ Weil_Alert_Sec_Lit_Enforcement_Dec_21_2012.pdf.

16

17 FINRA modified NASD Rule 2210, but the rule is now codified as FINRA 2210. FINRA became the successor for NASD in 2007 when the SEC approved the formation of a new regulator which combined the member regulation and enforcement functions of NASD and the arbitration functions of the New York Stock Exchange. FINRA, NASD 2210: Communications with the Public, http:// finra.complinet.com/ en/display/display_main.html?rbid=2403&element_ id=3617.

18

Id. at (d)(1)(A).

19

Regulatory Notice 10-06, supra note 14 at 4.

20

Id. at 5.

17 C.F.R. § 240.17a–3 (2013) (specifying the records to be made by certain exchange members, brokers and dealers).

21

22 17 C.F.R. § 240.17a–4 (2013) (explaining the records to be preserved by certain exchange members, brokers and dealers).

23 NASD Rule 3110 is still the current rule. FINRA has not issued a replacement rule.

Regulatory Notice 10-06, supra note 14 at 3.

NASD Rule 2310 is now FINRA Rule 2111: Suitability.

Rule Conversion Charts, FINRA, http://www.finra. org/Industry/Regulation/FINRARules/p085560 (last visited Aug. 12, 2013).

24

25 NASD Rule 3010 is still the current rule. FINRA has not issued a replacement rule.

FINRA, Filing Communications for FINRA Review, http://www.finra.org/Industry/Issues/Advertising/ FAQ/#4-1.

26

See Letter from Alexander Gavis, FMR LLC Legal Department, to U.S. Sec. & Exch. Comm'n (Aug. 24, 2011), available at http://www.sec.gov/rules/interp/ s71100/gavis1.htm.

27

U.S. Sec. & Exch. Comm'n, Report on Massachusetts Registered Investment Advisers’ Use of Social Media (2012) available at http://www.sec.state.ma.us/sct/ sctmediasurvey/socialmedia.pdf.

28

29 Nick Paraskeva, Social Media Broker-Dealer Compliance Checklist, 2 Checklists for Corporate Counsel § 12:14 (April 2013).

30 This paper does not reflect the views of the Tennessee Department of Commerce and Insurance or any other government agency. All views expressed are my own and have no reflection on the views of the Tennessee Department of Commerce and Insurance.

The MMA allows for voluntary participation by Medicare enrollees, and is available only through private insurers offering Medicare Advantage plans. The most controversial aspect of the Part D prescription drug benefit is the so-called “doughnut hole,” a coverage gap requiring the beneficiary to pay 100% of drug costs when the cumulative annual cost of drugs is between approximately $2,200$5,000.18 The MMA passed by narrow margins in both the House and the Senate. In each chamber, the vote was almost straight down party lines, with Republicans controlling the “Yea” vote.19 The Part D benefit is still confusing and frustrating to many Medicare beneficiaries.

The Obama Administration (2009 - present) It came as little surprise that President Obama made health care reform one of his first priorities: he campaigned on the promise of sweeping changes to the health care system in an effort to reduce costs and make coverage available to most Americans. He sent a major reform bill to Congress within six months of the inauguration.

A painful political process ensued. Bitter partisan divisiveness, debates over the public option health plan, public misinformation (e.g., allegations the legislation provided for “death panels”), and charges of socialized medicine filled the airwaves, internet and print media. After much political maneuvering and intrigue rarely seen even in Washington, the legislation gained the final necessary House of Representatives approval on March 21, 2010.20 The Patient Protection and Affordable Care Act (PPACA) was signed into law on March 23, 2010.

On June 28, 2012, the United States Supreme Court issued its ruling in National Federation of Independent Business v. Sebelius, 567 U.S. ______ (2012). In a creatively crafted opinion, Chief Justice Roberts wrote for the majority upholding the constitutionality of all but one of the major provision of the ACA. The Court ruled: (1) the individual mandate is a permissible exercise of Congress’ taxing power and thus constitutional, and (2) the Medicaid expansion “cram down” provision (essentially requiring all states to expand Medicaid coverage to all otherwise eligible individuals with incomes up to 133% of the federal poverty level) is an impermissible exercise of Congressional power and thus unconstitutional.

In its irreducible essence, the ACA provides for: (1) a mandate for “large” employers to provide health insurance coverage for its employees; (2) a mandate for virtually all citizens to have health insurance coverage through an employer sponsored plan, a government plan, or an individual plan; (3) creation of federal and/or state health care exchanges to facilitate obtaining health care insurance; (4) federal financial subsidies for health care insurance for individuals meeting low income standards; (5) a mandate that all plans provide a certain minimal level of essential benefits; and (6) prohibitions against denials of coverage based on pre-existing conditions and against lifetime benefit limits.

Continued on Page 24 

Nashville Bar Journal - November 2013

23

Health Care Reform In America: The Good, the Bad and the Ugly Continued from page 23

Conclusion The PPACA is in some respects a conglomeration of some of the pieces of past proposals for major health care reform.

The provision of health insurance coverage through private insurers instead of directly through the government, employer mandated health insurance, the creation of state, regional or national clearinghouses for insurance, federal subsidies for low income individuals, and “guaranteed eligibility” have all been proposed in previous attempts at reform.

Partisan divisiveness, bitter congressional fights, grass roots campaigns and political intrigue have been ubiquitous characteristics of health care reform efforts. But in the end, the democratic process has worked. Legislation deemed not in the public interest has been defeated in Congress, and enacted legislation that proved to be unpopular or unworkable has been repealed. When the final chapter on the efficacy of the PPACA is written, it is hoped history will record that the American system worked yet again – the good, the bad, and the ugly. n

(Endnotes) 1

Hospital-Aid Plan Has 347 Projects, N.Y. Times, July 2, 1948.

arrepim, Mathematical and Financial Calculators, http://stats.areppim.com/calc/calc_usdlrxdeflator.php.

2

Hospitals & Health Networks, American Presidents and Health Reform: A Chronology, H&HN Magazine (Feb. 2009), available at http://www.hhnmag.com/hhnmag/jsp/ articledisplay.jsp?dcrpath=HHNMAG/Article/data/02FEB2009/0902HHN_CoverStory_ WebExtra&domain=HHNMAG. 3

4

Kennedy Exhorts Public To Support Medical Care Bill, N.Y. Times, May 21, 1962.

Following the elections the Democrats held close to a 3/4 majority in the Senate and approximately a 2/3 majority in the House of Representatives. Social Security Admin., Vote Tallies for Passage of Medicare in 1965, http://www.ssa.gov/history/tally65.html.

5

Among the notables opposing the Medicare legislation were Ronald Reagan, Bob Dole, George H.W. Bush, and Barry Goldwater. Igor Volsky, Flashback: Republicans Opposed Medicare in 1960s by Warning of Rationing “Socialized Medicine”, ThinkProgress (July 29, 2009), http://thinkprogress.org/ health/2009/07/29/170887/medicare-44/.

6

The vote tally was 70-24-6 in the Senate, and 307-116-10 in the House. Social Security Admin., supra note 5.

7

The Kaiser Foundation, Total Number of Medicare Beneficiaries (2012), http://kff.org/medicare/ state-indicator/total-medicare-beneficiaries/.

8

9 Census Bureau, The 2012 Statistical Abstract, http://www.census.gov/compendia/statab/cats/ health_nutrition/medicare_medicaid.html.

According to the Centers for Medicare and Medicaid Services (CMS), at any one time approximately 15% of the total Medicaid population is also enrolled in Medicare Terrence Jeffrey, Medicaid and Medicare Enrollees Now Outnumber Full-Time Private Sector Workers, cnsnews.com (Oct. 12, 2012), http://cnsnews.com/news/article/medicaid-and-medicare-enrollees-now-outnumber-fulltime-private-sector-workers.

Elizabeth Goodridge & Sarah Arnquist, A History of Overhauling Health Care, N.Y. Times (2010), http://www.nytimes.com/interactive/2009/07/19/us/politics/20090717_HEALTH_TIMELINE. html?_r=0.

10

11

H&HN, supra note 3.

American Health Planning Assoc., Certificate of Public Need (2009), http://www.ahpanet.org/ copn.html.

12

Jerry W. Taylor is a Member of Stites & Harbison, PLLC, located in the Nashville office.

His practice focuses on health care law, business transactions and commercial loan transactions.

He has practiced health care law in both private practice and for government regulatory agencies.

He is a member of the Nashville Bar Association, Tennessee Bar Association and the American Health Lawyers Association.

13 Christine Delargy, Jimmy Carter: We Could Have Had Health Care Reform in the 1970s, CBS News (Dec. 1, 2010), http://www.cbsnews.com/8301-503544_162-20024330-503544/jimmy-carter-wecould-have-had-health-care-reform-in-1970s/.

See Retreat in Congress; The Catastrophic-Care Debacle-A Special Report; How the New Medicare Law Fell on Hard Times in a Hurry, Special to N.Y. Times, Oct. 9, 1989.

14

15

See Goodridge & Arnquist, supra note 10.

Boundless, The Health-Care Plan of 1993, http://www.boundless.com/u-s-history/the-challengesof-globalization-and-the-coming-century-after-1989/the-clinton-administration/the-health-careplan-of-1993/.

16

17

See H&HN, supra note 3.

Govtrack.us, H.R. 1 (108th): Medicare Prescription Drug, Improvement, and Modernization Act of 2003, https://www.govtrack.us/congress/bills/108/hr1; Ellen Shaffer, The Medicare Prescription Drug Improvement and Modernization Act, Our Bodies, Ourselves Health Resource Center (rev. June 2004), http://www.ourbodiesourselves.org/book/companion.asp?id=26&compID=96.

18

19 The Hose vote was 220 Yea (204 R, 16 D)-215 Nay (25 R, 189 D, 1 I). The Senate vote was 54 Yea (42 R, 11 D, 1 I)-44 Nay (9 R, 35 D Govtrack.us, supra note 18.

20 The final vote tally was Senate Yea 60 (58 D, 2 I)-Nay 39 (0 D, 39 R); House Yea 219 (219 D, 0 R)- Nay 212 (34 D, 178 R). Govtrack.us, supra note 18.

24

Nashville Bar Journal - November 2013

Nashville Bar Journal - November 2013

25

Disclosure Allegra Montgomery Walker, Davidson County Prosecutor, received the Sherry Jones Award for Outstanding State Government Official for her work in prosecuting domestic violence cases. The presentation was made at the annual “Meet Us at the Bridge” ceremony this month, which honors victims of domestic violence. Walker is part of a newly-revamped Domestic Violence Prosecution Team at the DA’s office, and in addition to handling DV cases in court, she’s been very pro-active in speaking to community groups and schools about preventing domestic violence and elder abuse. Walker is a graduate of Fisk University and earned her JD degree from the University of Toledo. She has been an Assistant District Attorney General for the 20th Judicial District since 2007.

Rachel Sobrero, Davidson County Prosecutor, was honored by the Tennessee District Attorneys General Conference last week for her work in training prosecutors across the state. Sobrero received the President’s Award distinction for her work in developing and implementing a training school for Tennessee prosecutors, as a way to hone their courtroom skills in opening and closing statements and cross examination of witnesses. Sobrero is among four faculty members who are currently working on the second year of presenting the class to Tennessee Assistant DAs. She has been a prosecutor with the Davidson County DA’s office for 10 years. Sobrero is a graduate of Colorado College, and received her law degree from the University of Denver.

Brendi Kaplan, a partner in Burr & Forman LLP, Kaplan has been selected for the 2014 Leadership Middle Tennessee (LMT) class. Kaplan was selected along with 30 other community and business leaders to take part in a year-long program to educate local leaders on the economic developments and business objectives of the 10-county area that Middle Tennessee covers. At Burr, Kaplan practices in the areas of healthcare, real estate and public finance.

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Nashville Bar Journal - November 2013

\Dis*clo”sure\ (n) The act of revealing, releasing or bringing to light relevant information concerning NBA Members & Staff. n Announcements n Kudos n People on the Move n Firm News Bryan Pieper has joined the law firm of Bone McAllester Norton PLLC. He practices law in the areas of labor and employment and commercial litigation, helping clients prevent and resolve employment law and business disputes. His focus is on dispute resolution and also on dispute prevention through measures such as policy preparation, HR training and corporate compliance. He is also an experienced Rule 31 Civil Mediator.

Beau Creson has joined the law firm of Walker, Tipps & Malone PLC, a trial litigation firm whose attorneys focus on civil litigation and dispute resolution. Creson is originally a native of Memphis, Tennessee. He graduated magna cum laude from Clemson University in 2010. At Clemson, Creson received a Bachelor of Arts in communications and was elected to Phi Beta Kappa. He obtained his J.D. from Vanderbilt Law School in 2013, where he was named to the Order of the Coif. Creson is licensed to practice law in Tennessee and is a member of the Nashville and Tennessee Bar Associations. His practice primarily involves general business and tort litigation in state and federal courts and arbitration.

Matthew S. White has joined Frost Brown Todd LLC as an Associate in the Nashville office where he practices in the Regulatory Business Group. White attended both law school and engineering school at Washington University in St. Louis. During law school, he was a Teaching Assistant and served on the Global Studies Law Review. He was also President of the Federalist Society and a member of the 3L Class Giving Campaign Committee.

Ashley Farrell has joined the law firm of Hollins, Raybin & Weissman, P.C. as an associate attorney. She is a 2013 graduate of Nashville School of Law and earned her B.A. in Political Science at Rhodes College. Ashley will focus on plaintiff’s personal injury and domestic relations.

n

B. Duane Willis has joined Morgan & Akins, PLLC as a senior attorney. Willis is a 1998 graduate of the University Of Tennessee College Of Law. He has 15 years’ experience in civil litigation. Willis will continue to focus his practice on Insurance Law and Defense, including Workers Compensation, Automobile and Trucking Liability, Employment Law, Products Liability, Premises Liability, and Black Lung Litigation matters. Willis was recently responsible for the favorable decision in Troy Mitchell v. Fayetteville Public Utilities, Supreme Court Case No. M2011-00410-SC-R3-WC, which changed the Tennessee state standard and revived the defenses of willful misconduct and willful failure to use a safety device.

Peter C. Robison has joined the law firm of Cornelius & Collins, LLP as an associate. Robison focuses his law practice on employment law, general civil litigation, insurance defense, and estate administration. He received his Juris Doctorate from Vanderbilt University Law School in 2008, and earned a Bachelor of Arts in Political Science from Brigham Young University in 2005. Robison is licensed to practice before the state courts of Tennessee and the U.S. District Courts for Eastern, Middle and Western Districts of Tennessee.

Sepideh C. Khansari has joined the law firm of Cornelius & Collins, LLP as an associate.

Khansari brings over four years of civil litigation experience. She graduated from Middle Tennessee State University where she received a B.S., cum laude, in Recording Industry, and an M.B.A., concentrating in Management. After her undergraduate and graduate studies at MTSU, she received a J.D. from Washington and Lee University School of Law. Khansari is licensed to practice in the state and federal courts of Tennessee and will focus her practice in the areas of insurance, medical malpractice and personal injury.

Welcome New NBA Members!

Steven Eric Blumenthal Bone McAllester Norton PLLC* Christopher Borns Reber M. Boult Adams and Reese LLP* Lori Leigh Brewer Nelson Mullins Riley & Scarborough* Marc David Bussone Bradley Arant Boult Cummings LLP* Matthew Malloy Conrad Bradley Arant Boult Cummings LLP* Gibeault Cooper Creson Walker, Tipps & Malone, PLC* Katie Dageford Tennessee Medical Association Nicholas Anders DuPuis Adams and Reese LLP* Ashley Ann Farrell Hollins, Raybin & Weissman, P.C.* Kiel Andrew Fisher Bass, Berry & Sims PLC Anna Elizabeth Gernert Bass, Berry & Sims PLC Bruce Henley The Law Office of Bruce Henley Kaitlyn Holland Katelyn Holub Jessica Grace Ann Jernigan-Johnson Bradley Arant Boult Cummings LLP* Britney Kennedy Hughes & Coleman* Rocklan William King III Adams and Reese LLP* Timothy Michael Lee Manier & Herod, P.C. Joseph Alexander Little IV Bone McAllester Norton PLLC* Robert E. McAlhany Adams and Reese LLP* Alison McCommons Belmont University Laura McKenzie Christopher Menerick Robert William Miller Manier & Herod, P.C. Nathan T. Moore Southern Environmental Law Center Linda A. Nathenson Levine, Orr & Geracioti, PLLC* Daniel Ray Osborne Bradley Arant Boult Cummings LLP* Keaton Harrison Osborne Bradley Arant Boult Cummings LLP* Timothy Alan Palmer Ogletree, Deakins, Nash, Smoak & Stewart, P.C.* Jonathan Parrett Ellery Rene Richardson

2014 NBA Premier Members INCLUDE: Elizabeth A. Alexander Gail Vaughn Ashworth Kathryn E. Barnett Charles H. Beaty Barbara Bennett Charles W. Bone Jay S. Bowen C. Dewey Branstetter Jr. Joe B. Brown Kenneth Sherman Byrd Kathryn Caudle Mark P. Chalos John Ray Clemmons Dixie W. Cooper Patricia J. Cottrell John A. Day John Franklin Floyd Charles K. Grant John J. Griffin Jr. William L. Harbison Marian F. Harrison Trey Harwell Paul T. Housch R. Jan Jennings John D. Kitch William C. Koch Jr. Edward Dodson Lanquist Jr.

Thomas W. Lawless Claudia Vettel Levy Richard Wesley Littlehale Randal S. Mashburn Amanda J. McClendon Jeffrey Mobley Marlene Eskind Moses Patricia Head Moskal Michael I. Mossman Jonathan Parrett Gregory J. Pease Tracy A. Powell Benjamin M. Rose Edgar M. Rothschild III Maria M. Salas Thomas J. Sherrard III Emily A. Shouse Saul A. Solomon Michael G. Stewart James Gerard Stranch IV Hon. Aleta Arthur Trauger Irwin Bruce Venick Michael J. Wall James L. Weatherly Jr. Peter Weiss Thomas V. White Larry R. Williams Nicholas S. Zeppos

NBA Premier Membership is a special category that recognizes our members who desire to demonstrate the utmost in commitment and support to the NBA Programs & Services.

Contact Vicki Shoulders (615.242.9272, vicki.shoulders@nashvillebar.org) for details.

Brittain Weaks Sexton Bass, Berry & Sims PLC Elizabeth Sitgreaves Dodson Parker Behm & Capparella, P.C.* Nancy Steer Jeffery Austin Stokes Manier & Herod, P.C. Zeterrika Cherell Tanner Bradley Arant Boult Cummings LLP* Janice Elaine Taylor Cornelius & Collins, LLP* Daniel Bryan Thomas Bradley Arant Boult Cummings LLP* Martin Douglass Trimiew Leitner, Williams, Dooley & Napolitan, PLLC* David Whelan Thomas W. Whitworth Manier & Herod, P.C. Sydney Alyse Young * Belongs to a 100% Club firm

Nashville Bar Association members may send Disclosure announcements via email to nikki.gray@nashvillebar.org Submissions are subject to editing.

Dial-A-Lawyer is held the first Tuesday of each month. The public is invited to call in with basic legal questions.

November Volunteers:

David Cooper Gina Crowley Barry Gearon Tom Lawless Doug Pierce Joe Rusnak

December Volunteers:

Julie Cornell Russell Cornell Gina Crowley Barry Gearon Cheyanne Kinghorn Tom Lawless Joe Rusnak

To volunteer your time, please contact Wendy Cozby, LRIS Coordinator at wendy.cozby@ nashvillebar.org or 242-9272. Pro Bono credit does apply and dinner will be provided.

Nashville Bar Journal - November 2013

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Classifieds

Office Space

Office Space BRENTWOOD AREA LAW FIRM Established Brentwood Law Firm has one office space immediately available. Includes receptionist services, internet, fax, use of conference room, copiers, and free and convenient parking.

Professional work environment. Call 615-3768857 for details or schedule a showing.

Downtown Office space to share with two established attorneys. High speed internet, telephone, fax, copy, storage and parking. Location: 201 Fourth Avenue, North, 14th Floor.

For more information contact mbarnes@ hubbardberry.com

Downtown Office condos for Lease or Sale. 500 to 2500 sq. feet. 501 Union Street, 5th floor. Near Legislative Plaza. Call Lynne at (615) 259-1550.

www.nashvillebar.org

Expert Witness Office Space Legal Nurse Consulting Handling cases with medically related aspects? Best Practice Legal Nurse Consulting can help you with superior case preparation. Best Practice can screen cases for merit, find expert witnesses, write summaries and chronologies of medical records, along with other services. Contact Lisa at 615-481-5047 or visit bplnc.com for more information.

Downtown Office Space-Court Square Bldg. 2nd FL. One to three offices. $1,000 to $1,500 depending on need. Shared expenses. Contact: kohllaw@bellsouth.net HILLSBORO VILLAGE Established Nashville law association with four experienced lawyers has shared office space available for the right attorney in a large private building (with front lawn and large porch) and plenty of on site parking (and free client parking.) Package includes receptionist services, cable & wireless Internet, telephones and fax, state of the art copier and postage machine, DISH TV, kitchen, all utilities, janitorial service, plus tastefully decorated reception area & conference room, on and off-premise storage, professional liability insurance, website advertising, and all office equipment (including personal computer and all private office furniture.) All inclusive. Added bonus...walk to banks and some of the city’s finest restaurants.

Contact adam@durhamanddread.com or call 615-252-9937.

Metrocenter Area Law Firm Established Nashville law firm has three office spaces immediately available. Includes receptionist servicces, cable internet, telephones and fax, conference room, kitchen, copiers, some LexisNexis subscription services, website advertising and more. Professional work environment. Free and conveninet parking. Call (615) 252-8866 for details.

Music Row Established Bankruptcy law firm located on historic Music Row (16th Avenue) has a large office space, with adjoining secretarial space immediately available. Includes limited receptionist services, copier, scanner, fax, high speed internet access, digital phone system, free and convenient parking. $1,250.00 per month. Contact Kim Lyons (615) 690-3120 or kimberly@rothschildbklaw.com.

Visit the NBA's Career Center & Get Started Today: http://jobs.nashvillebar.org/home

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Search for and quickly apply to great, relevant jobs

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Place your job in front of our highly qualified members

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Set up Job Alerts so you are immediately notified any time a job is posted that matches your skills or interests

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Search our resume database of qualified candidates

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Manage jobs and applicant activity right on our site

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Limit applicants only to those who are qualified

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Fill your jobs more quickly with great talent

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Create an anonymous job seeker profile or upload your anonymous resume so employers can find you

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Access job searching tools and tips

Advertising: Contact Tina Ashford at (615) 242-9272 or tina.ashford@nashvillebar.org

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Nashville Bar Journal - November 2013

Employers:

Job Seekers:

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Elder Law Practice of Timothy L. Takacs

Aging is inevitable The nursing home crisis is optional.

All it takes is a Life Care Plan.

A Life Care Plan helps protect family assets, get the best possible care and create a plan of action for the future.

Our skilled, experienced and compassionate professionals will empower your clients to protect elderly loved ones’ financial rights, legal rights, eligibility for public benefits, quality of life and more —now and in the future.

Help your clients avoid the crisis. Refer them to Elder Law Practice of Timothy L. Takacs. For two decades, improving quality of life for elders and the families who love and care for them has been our primary focus.

We can help your clients, too.

Middle Tennessee: (615) 824-2571 Cumberland Plateau: (931) 268-5761 Toll-Free: (866) 222-3127 Family Website: www.tn-elderlaw.com Professional Education Website: www.elderlaweducation.com

Life Care Planning Elder Law Estate Planning Care Coordination