Richard H. Silverman Named an Officer of University of Arizona Foundation Board of Trustees

PHOENIX, Ariz. (August 25, 2014) – Jennings, Strouss & Salmon, PLC, a leading Phoenix-based law firm, is pleased to announce that Richard H. Silverman has been named Vice Chair of the University of Arizona (UA) Foundation’s Board of Trustees.

Silverman’s one-year term began on July 1, 2014. The other members of the Board include Chair Thomas W. Keating, Secretary Ted H. Hinderaker, Treasurer Robert F. Charles, Jr., and Past Chair Sarah B. Smallhouse.

“I am honored to serve,” said Silverman. “Especially because of the university’s growing and expanding impact on Maricopa County and the state with projects like the UA Cancer Center and Tech Launch Arizona.”  

Silverman served on the UA Foundation Board of Trustees for more than 10 years, and supports the university’s Steele Children’s Research Center and the UA Cancer Center. He earned his undergraduate degree in 1962 and his juris doctorate in 1965 from the UA. Silverman serves on the UA College of Medicine-Phoenix Leadership Board, and the UA TRIF-Water, Environmental and Energy Solutions initiative External Advisory Board. In 1966, he began work at the Salt River Project and later became the company’s chief operating executive and general manager before joining Jennings Strouss in 2011.

About Jennings, Strouss & Salmon, PLC

Jennings, Strouss & Salmon, PLC,  has been providing legal counsel for over 70 years through its offices in Phoenix, Peoria, and Yuma, Arizona; and Washington, D.C. The firm's primary areas of practice include agribusiness; bankruptcy, reorganization and creditors’ rights; construction; corporate and securities; employee benefits and pensions; energy; family law and domestic relations; health care; intellectual property; labor and employment; litigation; real estate; surety and fidelity; tax; and trust and estates. For additional information please visit www.jsslaw.com and follow us on LinkedIn, Facebook and Twitter.

The firm’s affiliate, B3 Strategies, assists clients with lobbying and public policy strategy at the local, state, and federal levels. For more information please visit www.b3strategies.com.

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Contact:  Dawn O. Anderson  |  danderson@jsslaw.com|  602.495.2806

Arizona Registrar of Contractors Transition in Complaint Handling Process

By John G. Sestak, Jr.

The Arizona Registrar of Contractors (ROC) has historically followed a unique enforcement process, which has been described as “complainant driven.” Under that process, the complaining party made the sole decision “in whether to file a complaint, whether to have the ROC issue a citation, whether a hearing would occur, and whether repairs or settlement agreements complied with the terms of the contract.” As the ROC described, in a Director’s Message dated September 5, 2013, “in this ‘complainant driven’ process, the complainant made the critical decisions as the parties attempted to resolve their dispute.”

Since the fall of 2013, the ROC has transitioned from a “complainant driven” process to a regulatory process. Now, the ROC will effectively have complete control over the entire process once a complaint is filed. A citation will not be issued simply because the complainant requests it. Rather, the ROC will decide whether the evidence produced by the complainant and gathered by the ROC investigator supports the issuance of a citation. The Director’s Message states that, based upon a comparison with other states, this change will result in fewer citations being issued against contractors.

If the ROC decides to issue a citation, an arbitration process can be implemented. The arbitration process will typically be used for small-dollar disputes involving poor construction on residential properties where a contractor is not the subject of numerous prior complaints. For these cases, the contractor will be able to avoid the citation and formal disciplinary process by resolving the complaint through arbitration.

If a complaint is not resolved, the ROC may decide to prosecute the claim, regardless of whether the complaining party has made a settlement with the contractor or otherwise decides to abandon the complaint. Even if the complainant settles with the contractor, the ROC may elect to prosecute the claim and proceed to a hearing. The ROC may also subpoena the complainant’s testimony, even though the complainant has settled with the contractor. This is why the complainant ceases to become a “party” to the action or process once the complaint is filed.

The ROC will impose progressive discipline on contractors’ licenses based upon the severity and recurrence of violations. The ROC states that, in the future, discipline will consist of letters of concern, suspension limited to a finite number of days, suspension until compliance with an order of the ROC, and possible revocation of a license. The ROC suggests that this change will result in fairer and speedier resolution of investigations and that a contractor will not permanently lose its license for a first-time minor violation.

While the ROC states that these changes will enhance consumer protection, reduce “gaming of the system by bad contractors…,” be fairer to good contractors, and streamline the process, it remains to be seen what will evolve. The Director, in a Director’s Message of May 30, 2014, reported that the new process has resulted in a decrease of the issuance of citations against contractors from 36% of all complaints to approximately 13% of all complaints.

Chapter 11 Bankruptcy (Infographic)

To learn more about bankruptcy law, contact Jennings Strouss. Jennings Strouss was ranked #1 in Phoenix, Arizona in the field of Bankruptcy and Creditor-Debtor Rights Law by The Best Lawyers in America®, 2010 & 2011.

Unsolicited Text Messages Can Be Costly

By John G. Sestak, Jr. 

We last visited the Telephone Consumer Protection Act, 47 U.S.C.A. § 227 et seq. in 2003, when we wrote about the plethora of unsolicited faxes that were inundating everyone daily, and the legal issues that were associated. Large companies are still being taken to task for unsolicited faxes, and they now encounter new ways of costly intrusions into our time, and wallets.

One of the newest types of “marketing” is advertising through Short Message Services (or “SMS”), a messaging system that allows cellular telephone subscribers to use their cellular telephones to send and receive short text messages. An “SMS message” is a text message directed to a wireless device by using the telephone number assigned to the device. When the SMS or “text” message call is successfully made to a recipient’s phone, the cell phone rings or otherwise “beeps” the receipt of the text message. This type of messaging is popular because mobile phones are rarely out of arms reach of their owners, and SMS messages can be received by a recipient anywhere in the world.

Many advertisers have engaged in SMS texting to promote products to thousands of recipients. In addition to encroaching on a recipient’s time, unsolicited text advertisements cost mobile users money because many wireless service providers charge fees for incoming text messages, or apply a usage allocation deduction to the recipient’s plan.

Congress passed the Telephone Consumer Protection Act (TCPA) to regulate the use of automatic dialing machines and pre-recorded voice messages. With the advent of mass “text marketing,” litigation against such mass marketers is being initiated because the TCPA prohibits “unsolicited advertisements,” which includes “any material advertising the commercial availability of any property, goods, or services, which is transmitted to any person without that person’s prior express invitation or permission.”

The penalties for violating the TCPA are substantial, and the Federal Communications Commission (FCC) can enforce the Act, fining the text senders who are in violation. In addition, private claimants can maintain claims for knowing or willful violations of the TCPA for actual damages, statutory damages, and treble damages up to $1,500 for each violation. This has led to a host of class action lawsuits being filed.

Fax, and now text, advertising is a relatively inexpensive way to distribute mass information about products or services; however, it can become very expensive when the advertisements are sent without prior authorization. Significant damages can be recovered for violations, and those who wish to advertise through these forms of media should carefully review the statutes. Ideally, the company sending the advertisement should attempt to get express permission if it does not have an otherwise standing relationship with the recipient. If the recipient requests that the sender discontinue sending such advertising messages, the sender must stop or risk liability.

FERC Approved First Pilot Project to Test the Fast-Track Licensing Process Provided in the Hydropower Regulatory Efficiency Act of 2013

The Federal Energy Regulatory Commission (“FERC” or “Commission”) approved this week the first pilot project to test a fast-track licensing process for hydropower development pursuant to the Hydropower Regulatory Efficiency Act of 2013 (the “Act”).

The Act directed FERC to investigate the feasibility of a two-year licensing process for low impact hydropower developments at non-powered dams and closed-loop pumped storage projects. FERC held an initial workshop on October 22, 2013 and sought comments and recommendations. On January 6, 2014, FERC issued a Notice opening a three-month window to file petitions for an expedited hydropower license under a pilot program starting February 5, 2014 and ending on May 5, 2014. These fast-track pilot projects were required to comply with following minimum criteria:

• Have minimal change to existing surface and groundwater flows and uses;
• Have no adverse effect on federally listed threatened and endangered species;
• Include a letter from the implicated federal dam owner saying the plan is feasible (if applicable);
• Include a letter from the managing entity of any public park, recreation area, or wildlife refuge giving its approval to use the site (if applicable); and
• For closed-loop pumped storage projects, the project must not be continuously connected to a naturally flowing water feature.

The first approved fast-track pilot project is Free Flow Power Project 92, LLC's (“Free Flow”) 5-megawatt hydropower project located at the Kentucky River in Estill and Madison Counties, Kentucky (Docket No. P-14276).  In March of 2012, the Commission granted a preliminary permit to study the feasibility of Free Flow’s hydropower project. After filing its petition for the expedited licensing process, Free Flow filed, in June of 2014, a notice of intent to file a license application and a pre-application document (“PAD”). The PAD contained: (1) a detailed project description; (2) a list of potential environmental effects; (3) a proposed study plan to fill information gaps; (4) a process plan and schedule; and (5) documentation of consultation with affected federal and state resource agencies, Indian tribes, non-government organizations, and the public.

In this first pilot, FERC did not require additional studies and approved Free Flow’s proposed studies for hydraulics, fish entrainment, and aquatic habitat without modifications. However, FERC required amendments to Free Flow’s proposed water quality study, endangered species survey, and cultural resource assessments. Remarkably, the letter approving the pilot also includes a process plan and a schedule with milestones that not only Free Flow, but also FERC Staff and the Kentucky DEP must meet.