Two Great ISBA Member Benefits Sponsored by
A Value of $1,344, Included with Membership

Practice News

Employers and insurers beware: effective November 21, a new federal statute with the acronym "GINA" forbids discrimination based on genetic information. Read Helen Gunnarsson's LawPulse item from the September IBJ, which describes the Genetic Information Nondiscrimination Act  and links to EEOC rules interpreting it.
The Legislative Research Unit has done an excellent job of summarizing most of the bills that have been sent to the Governor. It may be found at LRU's website at this link. Click on "First Reading," and then click on the August 2009 issue, vol. 23, No.1. You may have to go to the General Assembly webpage to see if the bill has been signed into law, by clicking here.
May an Illinois lawyer list his or her "specialties" on LinkedIn without running afoul of Illinois RPC 7.4, which forbids use of the "s" word? The LinkedIn template includes a space for users to fill in their "Specialties," and Illinois lawyers in the LinkedIn network have been wondering. According to Helen Gunnarsson in the September IBJ, ARDC Chief Legal Counsel James Grogan says lawyers can remove the risk of an RPC 7.4 violation by "prefac[ing] their listing of practice areas with a statement drawing language from the rule, along the lines of 'The Supreme Court of Illinois does not recognize certifications of specialties in the practice of law, and I do not hold myself out as a specialist. However, I concentrate my practice in the following areas....'" Read about this and more in Helen's LawPulse item, Social media and legal ethics.
According to John Phipps in the latest General Practice, Solo and Small Firm newsletter, three clauses should be part of every fee agreement: 1) one addressing what happens when you're sick, on vacation or otherwise unavailable; 2) one specifying that you aren't guaranteeing results; and 3) one pointing out that you can't estimate costs you don't control (e.g., costs driven by the other party's behavior). Find out more, including the specific language John recommends.
Public Act 96-707 (Haine, D-Alton; Turner, D-Chicago) provides for a hearing to be held when a juvenile with a first-offense misdemeanor turns 18 or upon completion of the sentence, whichever comes later. If local prosecutors do not file objections, expungement will be automatic. The limited objections that may be considered by a judge include the following: (1) if the arrest was for a homicide, an offense involving a deadly weapon, a sex offense, or aggravated domestic battery; (2) if the offense for which the minor was arrested is still under active investigation; or (3) if the minor is a potential witness in an upcoming court proceeding. Public Act 96-707 also prohibits the transfer of confidential juvenile arrest records from the State police to the Federal Bureau of Investigation to prevent the unnecessary release of confidential juvenile data. Effective January 1, 2010.

In the September issue of Child Law, Margaret C. Benson describes the shortcomings of current guardianship law and an ISBA legislative proposal designed to address them.

"Traditionally, minor guardianships were fairly simple cases, necessary when parents died or were temporarily unable to care for their children, " Benson writes. "Most cases were uncontested. The statute was designed to be 'easy in, easy out,' with a simplified process and fill-in-the-blank forms.

"About a decade ago, however, everything changed. Probate judges found themselves inundated with increasingly complex and bitter contested minor guardianship disputes, caused by a confluence of factors, including a significant shift in DCFS policy and a seismic cultural change.

The law as written is simply inadequate to the new reality, Benson writes. "In its current form, the Probate Act does not adequately protect the rights of parents or children. For instance, the statute does not contain any provisions for a parent to petition to terminate the guardianship. In addition it uses the undefined term 'fitness' to determine if a guardian should be appointed for a child. This leaves parties, attorneys and judges without guidelines to determine when a guardianship should be granted and when it should be terminated."

In response, Benson and other ISBA members have crafted a legislative proposal that would bring guardianship law up to date. Find out more about it.

Currently, the Federal Government and most states do not tax income of partnerships, “S” corporations, and limited liability companies (LLCs) that elect to be treated as partnerships. Instead, the income is taxed after it flows through to individual partners or shareholders. Illinois has followed this practice for regular income tax purposes but does tax these entities with a “personal-property replacement-income tax.” Illinois has allowed “S” and “C” corporations to deduct compensation paid to owners, but partnerships are not allowed to do so. To treat partnerships in the same way as S and C corporations, Illinois has allowed partnerships to deduct a portion of their distributable income that represented reasonable compensation. Public Act 96-45 changes this tax policy effective for tax years ending Dec. 31, 2009 for the personal-property replacement-income tax. It limits partnerships’ deduction to “guaranteed payments” instead of “reasonable compensation.” The difficulty is guaranteed payments for federal purposes is limited to payments made regardless of the profitability of the partnership. This would generally limit the deduction to income partners because equity partners’ income is based on their share of distributable income of the partnership. Public Act 96-45 will affect personal-service partnerships such as law firms, accounting firms, private equity, and investment fund managers because almost all of the distributable income to the equity partners represents the personal services of the partners. Since these distributions cannot be categorized as guaranteed payments, the partnerships may have significant taxable income for Illinois replacement tax purposes.
David Eldridge's review of 2009 state and local tax-law changes -- property tax, income tax, sales tax, the whole shootin' match -- is in the latest issue of Tax Trends, newsletter of the ISBA's State and Local Tax Section.
In the latest ISBA Corporate Lawyer, Frank Grenard nicely summarizes the much ballyhooed beefing-up of the Illinois Freedom of Information Act. The changes take effect January 1. As Frank notes, excuses for noncompliance will be harder to come by. "[T]he Act provides that irrespective of added cost to comply and technological advances, public records 'shall' be made available upon request except when denial of access furthers the public policy underlying 'a specific exception.'” And the new process will be more requester friendly, he reports. "The Act will prohibit public agencies from requiring the use of individualized FOIA forms, nor can the public agency require the requester to disclose the purpose for the request." Read all about these and other elements of the new FOIA law.
The American Bar Association filed suit today asking the federal courts to bar the Federal Trade Commission from enforcing its “Red-Flag Rule” against practicing lawyers that is to take effect Nov. 1, 2009. The FTC established the Red-Flag Rule to require certain “creditors” to develop and implement written programs to identify, detect, and respond to the warning signs (“red flags”) of identity theft. The FTC plans to apply this Rule to lawyers and other service providers such as doctors, dentists, and accountants. The ABA and other associations do not believe that these groups engage in the kind of commercial activity that was intended to lump them in with creditors as intended by this Congress. The ABA complaint, filed in the District Court in the District of Columbia, may be viewed at this link: http://www.abanet.org/media/nosearch/1_1_Complaint.pdf