• Controllers, Drive Your Professional Development: Attend CHCC 2018

    Club and hotel controllers: Do not miss the opportunity to get behind the wheel and take control of your own professional development. The Club and Hotel Controllers Conference (CHCC) — co-located with the world’s largest hospitality technology show HITEC® Houston at the George R.

  • Paycheck Checkup: The IRS Encourages Taxpayers to Review Withholdings

    April 17, 2018: Tax day in the United States has come and gone. Individual taxpayers have filed all of their paperwork, and have either paid up the amount owed to the United States Internal Revenue Service (IRS) or deposited their refunds in their bank accounts.

  • Is the Lodging Industry Ready for a 12th Edition of USALI?

    The 11th edition of the Uniform System of Accounts for the Lodging Industry (USALI) went live on January 1, 2015. This edition presented multiple updates such as changes to the way customers were reported in food outlets, new rooms revenue and demand segmentation, gross versus net reporting, and the addition of a new schedule, Schedule 6 — Information and Telecommunications Systems.

  • What to Expect at HITEC Houston 2018: Elite Education, Exhibits, E20X and More

    HOUSTON: A booming cosmopolitan city that is home to more than 2 million Texans, NASA’s famous Johnson Space Center, and — in just two short months — the world’s largest hospitality exhibition HITEC®.

Article by Jim Butler & Jodi Smith

Proposition 65 Defense Lawyer: Is your hotel ready for the new Prop 65 regulation deadline?

JMBM ·14 May 2018
For many years, businesses operating in California have been plagued by "bounty hunter" and government lawsuits brought under Proposition 65 -- the California law that requires warnings about hazardous substances. The technical disclosure requirements have bedeviled many legitimate businesses for some time. From our continuous interaction with members of the hotel industry, it appears to us that many are not aware of new requirements they must meet by August 30, 2018.While the new regulations apply generally to all businesses in California, there are particular implications for hotels and restaurants given the nature of their operations. And if you are not in compliance by August 30, 2018, you can probably expect a lawsuit shortly thereafter. We expect these new requirements to stir up a lot of expensive litigation for the unprepared.In this article, Jodi Smith, a senior member of JMBM's Global Hospitality Group, explains this significant development.California Proposition 65 Warnings for HotelsNew Prop 65 regulations for hotels going into effect. The Safe Drinking Water and Toxic Enforcement Act of 1986 (better known as "Proposition 65" or "Prop 65") requires companies conducting business in California to warn consumers prior to exposing consumers to specific chemicals that have been identified pursuant to Proposition 65 as being chemicals known to cause cancer or birth defects or other reproductive harm. The Proposition 65 regulations were substantially revised in August 2016 and the new regulations go into effect on August 30, 2018. The new warnings can be used now. Given the complexity of the new warning requirements for hotels, getting a head start would be prudent.What's a hotel for Prop 65 purposes? The new regulations require the owner and/or operator of a hotel to determine which of a number of different types of warnings may be required under the new regulations. "Hotel" is defined broadly to include "any type of transient lodging establishment, including but not limited to, hotels, motels, bed and breakfast inns, resorts, spas, ski resorts, guest ranches, agricultural "homestays", tourist homes, condominiums, timeshares, vacation home rentals, and extended stay establishments in which members of the public can obtain transient lodging accommodations." (Title 27 California Code of Regulations (CCR) SS 25607.32(a))Warnings required for registration desk or online. The Proposition 65 warning must either (1) be provided on a sign posted at the hotel's registration desk in no smaller than 22-point type in a location where it will be likely to be seen, read, and understood prior to the completion of the registration or check-in process, or (2) provided to the hotel guest in electronic (directly or via a hyperlink) or hard copy form in the same size type as other consumer information prior to, or during the registration or check-in process. (27 CCR SS 25607.32.(b)) In addition, if written or electronic consumer information is given to hotel guests during the registration or check-in process in any language other than English, the warning must be given in both English and that language. (27 CCR SS 25607.32(c))Other Prop 65 warnings. However, in addition to the hotel warning discussed above, hotels must also provide warnings (1) for designated smoking areas or smoking rooms in nonsmoking hotels, (2) alcoholic beverages, (3) certain foods, (4) consumer products, where such products are offered for sale, and (5) enclosed parking facilities, where an onsite parking garage is available for guest parking. (27 CCR SS 25607.32(d))The devil is in the details and technical compliance is important. Each type of warning has specific requirements as to the content of the warning, the size of the font, and is some cases, the location in which the warning is posted. Jeffer Mangels Butler & Mitchell LLP can assist in your analysis of which specific warnings are required in your hotel(s) and how best to manage the multiple warnings required under the new regulations effective on August 30, 2018.
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2018 LIIC Top 10 - Annual survey of lodging investment challenges and opportunities

Hotel Law Blog | By Jim Butler· 8 May 2018
Today, at Meet the Money® – National Hotel Finance & Investment Conference, Mike Cahill, co-chairman of the Lodging Industry Investment Council (LIIC) and CEO and Founder of HREC Hospitality Real Estate Counselors, presents the annual LIIC Top Ten. For more than ten years, LIIC, the industry’s preeminent think tank, has surveyed its members to determine challenges and opportunities for the coming year. LIIC’s members represent the direct acquisition and disposition control of more than $40 billion and include industry investors, lenders, corporate real estate executives, REITs, public hotel companies, brokers, and equity sources.
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Proposition 65 Defense Lawyer: Is your hotel ready for the new Prop 65 regulation deadline?

Hotel Law Blog | By Jim Butler· 7 May 2018
For many years, businesses operating in California have been plagued by “bounty hunter” and government lawsuits brought under Proposition 65 — the California law that requires warnings about hazardous substances. The technical disclosure requirements have bedeviled many legitimate businesses for some time. From our continuous interaction with members of the hotel industry, it appears to us that many are not aware of new requirements they must meet by August 30, 2018.
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Who will you see at Meet the Money?

Hotel Law Blog | By Jim Butler·18 April 2018
It’s almost May, so our annual Meet the Money® Conference is almost here! JMBM’s Global Hospitality Group® will host the 28th year of our national hotel finance and investment conference May 7-9, 2018 at the Hyatt Regency LAX. This must-attend event gives you access to plenty of efficient networking and the latest insights into industry trends and strategies.
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The hotel industry salutes Larry Shupnick!

Hotel Law Blog | By Jim Butler· 5 March 2018
On Saturday, March 3, 2018, the hospitality industry gathered at the JW Marriott LA LIVE to honor industry icon Larry Shupnick, senior vice president of development & acquisitions at Interstate Hotels & Resorts. The sold-out event was the annual fund raiser organized by Cal Poly to benefit The Collins College of Hospitality Management.

Important News for Hospitality Executives: How the new Tax Act could affect your estate plan

JMBM ·30 January 2018
If you are a hotel executive or other highly compensated individual in the hospitality industry, you need to be aware of how the new Tax Act (H.R. 1 - Tax Cuts and Jobs Act) might affect your estate plan. In some cases, the impact will be significant. In the brief article below, JMBM's tax attorneys recommend that you review your existing estate plan to ensure that the Tax Act does not alter your plan's original intentions. They also point to substantial new planning opportunities provided by the Tax Act, and you will want to be advised of those, as well. What better way to start the new year than by making sure your assets, and your family's future, are protected?How the New Tax Act Could Affect Your Estate PlanPresident Trump signed into law H.R. 1, which has a major impact on estate planning. The new law doubled the federal exemption for estate tax, gift tax and the tax on generation-skipping transfers (GST), starting January 1, 2018; the lifetime exemption for each of these taxes is now $11.2 million per taxpayer. Married couples together have a total of $22.4 million of lifetime exemption. The exemptions are reduced by lifetime transfers prior to 2018 and are indexed for future inflation. The annual gift tax exclusion amount also increased to $15,000 per donee per year.The increased gift, estate and GST tax exemptions are not permanent. This part of the Tax Act is scheduled to expire in 2026 and return to the prior exemption amounts ($5.6 million plus inflation after 2018). Changes in control of Congress and the Presidency could also terminate the increased exemptions. While it may make sense for some clients to take advantage of the increased exemptions to engage in additional estate planning, there is also a potential risk that the new exemptions will unintentionally alter existing estate plans, requiring important immediate changes.As the increased exemptions may significantly skew a client's existing estate plan, it is important for all clients to review their estate planning documents to make sure they continue to reflect their intentions. Many estate plans for married couples use a formula to divide assets at the first death between a "marital" portion passing to or held in a trust for the surviving spouse and a "bypass" portion intended to bypass the estate of the surviving spouse. The bypass portion may be allocated to a trust for the surviving spouse and/or descendants. It may also be allocated directly to descendants, skipping the surviving spouse entirely, or may provide fewer benefits to the surviving spouse than the marital trust. Similarly, at the second death, the estate plan may have a formula dividing assets, based on the GST exemption, between children and grandchildren.Depending on the exact language of the document, these divisions may be very different now because of the larger exemptions. For some clients, the new division will be acceptable. For others, it will be important to update the language of their estate planning documents to avoid a sharp reduction in what the surviving spouse receives and what the children and grandchildren receive.Clients may also want to take advantage of the opportunity to pass larger portions of their wealth to younger family members at minimal tax cost, through lifetime gifts and other traditional wealth transfer techniques.The estate, gift and GST provisions of the new Tax Act present substantial new planning opportunities. They also have a potentially significant impact on existing estate plans. Clients need to review their existing documents to determine this impact. We are ready to help you with all aspects of this analysis and to advise you on the various available alternatives.
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Cyberattacks on Hotels - What Should Hotel Owners and Operators Do?

Hotel Law Blog | By Jim Butler·22 January 2018
Protecting guests’ information (and employees’ information) from hackers is one of the biggest business challenges faced by hotel owners today. Data breaches can result in loss of reputation and loss of revenue, and can trigger costly lawsuits and government investigations.
Article by Jim Butler

California Labor & Employment Law Update: Key Changes in 2017 and What's Slated For 2018

JMBM ·13 December 2017
California Labor & Employment Law Update: Key Changes in 2017 and What's Slated For 2018by The JMBM Labor & Employment GroupThe legal landscape for California employers continues to evolve at the state and local level - ranging from prohibitions on inquiries into an applicant's salary and conviction history, additional sexual harassment training requirements, to new immigration obligations. The following is a high-level summary of the most significant changes in state and local labor and employment laws, which go into effect on January 1, 2018, unless otherwise noted.EXPANDING POWERS OF THE DEPARTMENT OF LABOR STANDARDS (DLSE)DLSE can now independently commence investigations; petition for injunctive relief; and issue citations for suspected discrimination or retaliation based on a wage claim (SB 306). The DLSE has new powers starting January 1, 2018. With SB 306, the DLSE will now be authorized to commence an investigation of an employer, with or without a complaint being filed, when specified retaliation or discrimination is suspected during the course of DSLE investigations. The new law also authorizes the DLSE to petition a superior court for immediate injunctive relief based on a finding of reasonable cause. Such relief can include a court order that the employer reinstate employment or otherwise reverse its alleged retaliatory action against the employee. This is a huge departure from existing law which does not allow for the DLSE to seek this type of relief during an investigation.The new law also authorizes the DLSE to issue citations directing specific relief to persons determined to be responsible for violations. The law establishes review procedures, including procedures for requesting a hearing before a hearing officer, and for a petition for a writ of mandate. The law subjects an employer who willfully refuses to comply with a final order to civil penalties payable to the affected employee. The law also allows employees to seek injunctive relief in court.Contractors can now be directly liable for wage claims against subcontractors (AB 1701).On or after January 1, 2018, a direct contractor which undertakes a contract in the state for "the erection, construction, alteration, or repair of a building, structure, or other work," must assume, and be liable for, specified debt owed to a wage claimant that is incurred by a subcontractor, at any tier. The DLSE is authorized to bring an action to enforce this liability. It authorizes private civil actions to enforce the liability against a direct contractor. The new law does not apply to any work being done by an employee of the state or any political subdivision of the state. It requires a subcontractor, upon request from the direct contractor, to provide specified information regarding the subcontractor's and third party's work on the project and allows the direct to withhold disputed sums upon the subcontractor's failure to provide the requested information.NOTICE REQUIREMENTSHuman trafficking notice requirements extended to hotels, motels and bed & breakfast inns (AB 260 and SB 225).Two new laws which take effect on January 1, 2018 address human trafficking. AB 260 adds hotels, motels, and bed and breakfast inns, not including personal residences, to the list of specified businesses and other establishments required to post a notice with information related to slavery and human trafficking, including information related to specified nonprofit organizations that provide services in support of the elimination of slavery and human trafficking. SB 225 adds to the notice a specified number which a person may text for services and support, and revises the names of the nonprofit organizations listed in the notice. While not specifically addressed to employee issues, the required notice must be posted "in a conspicuous place near the public entrance of the establishment or in another conspicuous location in clear view of the public and employees where similar notices."Employers must specifically provide written notice concerning the rights of victims of domestic violence, sexual assault, or stalking (AB 2337).Existing law (Labor Code section 230.1) prohibits employers from discharging, discriminating, or retaliating against an employee who is a victim of domestic violence, sexual assault, or stalking for taking time off from work to: seek medical attention for resulting injuries; obtain services from a domestic violence shelter or rape crisis center; undergo counseling, or participate in safety planning. Last year, California passed AB 2337, which requires employers to provide written notice to employees about the rights of victims of domestic violence, sexual assault, or stalking. However, employers did not have to comply with this requirements until the Labor Commissioner developed a model notice. In June 2017, the Labor Commissioner posted the model notice. Employers may use the Labor Commissioner's notice, or create their own as long as it is substantially similar in content and clarity. The notice must include the following content:Inform employees that they have the right to take time off to obtain a restraining order/court order, seek medical attention, seek services from a domestic violence shelter, program, or rape crises center, seek counseling, or safety planning.Inform employees that they can use available vacation, personal leave, accrued paid sick leave, or compensatory time off for such purposes, unless they are covered by a collective bargaining agreement which provides different leave uses.Inform employees that they have a right to take time off for these purposes even if they do not have paid leave.Advise employees that they should give advance notice before taking leave. But, if they cannot give advance notice, they will not be disciplined if they provide proof for the absence within a reasonable time. Proof can be a police report, court order, or a doctor's/counselor's note.Inform employees that they can request as a reasonable accommodation that the employer make changes in the workplace to ensure the employees' safety. Advise employees that their accommodation request will be kept confidential.Inform employees that they have a right to be free from retaliation and discrimination and that they cannot be discharged because they are a victim of domestic violence, sexual assault, or stalking; because they asked for leave to get help; or because they asked the employer for an accommodation so they can feel safe at work.Advise employees that they can file a complaint with the Labor Commissioner's Office if they believe their rights have been violated.Employers must update their new hire/orientation materials to include either the Labor Commissioner's model notice or their own notice that satisfies the statutory requirements. Note, while employers must provide new hires with a notice of their rights under Section 230.1 (and other employees upon request), employers should consider providing a standard notice to all employees, not just new hires.PROHIBITED INQUIRIES OF JOB APPLICANTSEmployers cannot seek or use job applicants' salary histories as a factor in determining whether to offer a job (AB 168).Add this to the growing list of questions to avoid asking during a job interview: How much do you make in your current job? AB 168 prohibits an employer from seeking salary history information from a job applicant or using salary history as a factor in determining whether to offer a job. An employer also is not allowed, orally or in writing, personally or through an agent, to seek a job applicant's salary history information. Also, the law requires an employer "upon reasonable request" to provide the pay scale for a position to a job applicant. It does not apply to salary history information disclosable to the public under federal or state law.San Francisco mandates additional requirements on the prohibition of job applicants' salary histories (San Francisco's Parity Pay Ordinance.)San Francisco's Parity in Pay Ordinance is similar to AB 168, discussed above. Under the ordinance, an employer may not do any of the following:Ask about current or past compensation in the applicant's current position, or in any prior position (whether with the current employer or a prior employer).Consider an applicant's salary history as a factor in determining what salary to offer an applicant--even if the applicant voluntarily discloses his or her pay without prompting.Refuse to hire, disfavor or retaliate against an applicant for not disclosing pay history.Release the salary history of any current or former employee to an employer or prospective employer without written authorization.The Ordinance allows an employer to ask about the applicant's expectations with respect to salary. For example, it is permissible to ask about unvested equity or deferred compensation or a bonus that an applicant would forfeit or have cancelled if he or she quit a current job. This may be a way for employers to obtain salary information without asking directly for it. The Ordinance becomes operative on July 1, 2018, with penalties of up to $500 beginning on January 1, 2019.Limitations set on an employers' ability to inquire about a job applicant's criminal history (AB 1008).AB 1008 adds Government Code section 12952, which creates a new protected class under the Fair Employment and Housing Act (FEHA). Employers with five or more employees are prohibited from:Inquiring about an applicant's criminal history on a job application or at any time (i.e. during the interview process) before extending a conditional offer of employment.If employers run a conviction background check in connection with an application for employment, it is prohibited from considering, distributing, or disseminating information about (a) an arrest not resulting in a conviction, except as permitted in Labor Code section 432.7, (b) referral to or participation in a pretrial or post-trial diversion program, and (c) convictions that are sealed, dismissed, expunged, or statutorily eradicated.An employer who intends to deny an applicant a position of employment solely or in part because of the applicant's conviction history must first perform an individualized assessment. The assessment requires analysis of various enumerated factors, including whether the applicant's conviction history has a direct and adverse relationship with the specific duties of the job. If the employer decides to deny employment, it must provide the applicant written notification of its decision. The applicant then has the opportunity to respond by providing evidence challenging the accuracy of the conviction history report and/or evidence of rehabilitation or other mitigating circumstances. The employer must consider any information the applicant submits before making a final decision. If the employer's final decision is to deny employment, the employer must provide written notification to the applicant, including information on any additional appeal process and the applicant's right to file a complaint with the Department of Fair Employment and Housing (DFEH). AB 1008 does not apply to situations where employers (public and private) are required by law to conduct criminal background checks or to restrict employment based on criminal history.Employers should review their job applications, postings, and recruitment procedures to ensure they comply with AB 1008. Employers should also keep written records which demonstrate that they performed the required individual assessments and considered any applicant responses before making final employment decisions. Furthermore, employers need to comply with any related local ordinances, such as the San Francisco and the Los Angeles Fair Chance Ordinance. To the extent a local ordinance provides applicants greater protection, employers must comply with that standard.Los Angeles sets additional prohibitions on criminal history inquiries (Los Angeles Fair Chance Ordinance).Individuals with criminal records may have a better chance of finding a job in Los Angeles under the city's new Fair Chance Initiative for Hiring. Under the Ordinance, a prospective employer is not permitted to ask an applicant questions about criminal history before making a conditional offer of employment - meaning an offer that is conditioned on an assessment of the applicant's criminal history and how it relates to the duties of the job being offered. The meaning of "employment" here is broader than normal, because the law also applies to the retention of independent contractors and unpaid interns. The Ordinance became effective on January 22, 2017. The Ordinance applies to all employers located or doing business in the City of Los Angeles and that employ 10 or more employees.INCREASED EMPLOYEE PROTECTIONSEmployers cannot comply with certain requests from immigration enforcement officers unless a judicial warrant is provided (AB 450).A new law limits how much California employers may accommodate some requests from federal immigration officials. Beginning January 1, 2018, California employers "shall not provide voluntary consent to an immigration enforcement agent to enter any nonpublic areas of a place of labor," unless the immigration enforcement agent provides a judicial warrant. Similarly, employers will not be allowed to "provide voluntary consent to an immigration enforcement agent to access, review, or obtain the employer's employee records" without a warrant, except for I-9 employment eligibility and verification forms and other documents for which a Notice of Inspection has been provided to the employer. Employers must post a notice of any inspections of I-9 Employment Eligibility Verification forms or other employment records conducted by an immigration agency within seventy-two hours of receiving notice of the inspection. Upon reasonable request, the employer must provide a copy of the Notice of Inspection to an affected employee. AB 450 also provides that an employer "shall not reverify the employment eligibility of a current employee at a time or in a manner" not required by federal law. The Labor Commissioner has enforcement authority, and penalties for violations can be up to $10,000.Smaller employers (20+ employees) are now required to provide parental unpaid leave (SB 63).Small employers will need to be ready to give time off to new parents starting January 1, 2018. SB 63 will require California employers with at least twenty employees within a 75-mile radius to provide up to twelve weeks of job-protected unpaid leave to new parents for the purpose of bonding with a newborn child, adopted child, or foster-placed child. SB 63 is similar to the California Family Rights Act (CFRA), which requires employers with fifty or more employees within a 75-mile radius to offer these parental leave protections to new parents. Employers may not "interfere with, restrain, or deny the exercise of, or the attempt to exercise, any right" provided by the new law. Employees may use accrued vacation pay, paid sick time, other accrued paid time off, or other paid or unpaid time off negotiated with the employer, during the parental leave.Public employers who receive state funds are prohibited from discouraging or deterring public employees from becoming or remaining members of an employee organization (SB 285).Under Government Code section 16645.6, public employers who receive state funds are prohibited from using those funds to deter union organization. SB 285 goes a step further - prohibiting public employers from discouraging or deterring public employees from becoming or remaining members of an employee organization. Notably, this statute applies to all public employers regardless of the source of funds, including employers subject to the MMBA, Dills Act, EERA, HEERA, Trial Court Act, Court Interpreter Act, TEERA, and Section 12302.25 of the Welfare and Institutions Code. The Public Employment Relations Board has jurisdiction over any violations. Since the statute does not define what constitutes to "discourage" or to "deter," public employers must be cautious in their interactions with union members and the information they transmit about union membership. Significantly, SB 285 likely attempts to protect labor unions if the Supreme Court holds that agency fees cannot be imposed on public sector employees in Janus v. AFSCME.Amendment to the Military Veterans Code expands protections for military veterans by prohibiting discrimination in terms, conditions, or privileges of employment; violations of the law can result in criminal and civil penalties, and attorneys' fees (AB 1710 and SB 266).AB 1710 and SB 266 amends section 394 of the Military Veterans Code. Existing law prohibits discrimination against service members. These bills expand the scope of the protection for military personnel by prohibiting discrimination in terms, conditions, or privileges of employment. The law covers discrimination by individuals and public and private sector employers. Violations of the law result in criminal and civil penalties, including actual damages and reasonable attorney's fees. Given these remedies, employers need to ensure that their recruiters and supervisors are trained on service member anti-discrimination laws.Health care facilities face increased penalties for whistleblower retaliation/discrimination (AB 1102).Existing law (Labor Code section 1278.5) prohibits a health facility from discriminating or retaliating against a patient, employee, medical staff, or any health care worker because that person filed a grievance, complaint, report with the facility, or participated in an investigation or administrative proceeding related to the quality of care, services, or conditions at the facility. A violation of the statute results in a civil penalty of up to $25,000 dollars. Under AB 1102, a person who willfully violates section 1278.5 is also guilty of a misdemeanor punishable by a fine of up to $75,000 .California's recognition of nonbinary as a gender could result in new employer requirements (SB 179).Through SB 179, California now recognizes three genders - female, male, and nonbinary. This legislation allows individuals to update their gender on a birth certificate, a driver's license (beginning January 1, 2019), and obtain a court judgment (beginning September 1, 2018) without undergoing clinical treatment. Instead, the individual has to attest, under penalty of perjury, that the request for a change in gender is to confirm the person's legal gender to the person's gender identity and not for fraudulent purposes. While the impact of this legislation is unclear - it may impose new requirements on employers and educational institutions to provide additional restroom and locker room facilities.Anti-harassment training requirements expanded to include gender identity, gender expression, and sexual orientation (SB 396).FEHA currently requires employers with fifty or more employees to provide at least two hours of sexual harassment and abusive conduct prevention training to all supervisory employees within six months of an individual's assumption of supervisory duties and once every two years thereafter. SB 396 requires covered employers to include training on harassment based on gender identity, gender expression, and sexual orientation. The training must include practical examples and the trainer must have pertinent knowledge and expertise. SB 396 also requires employers to display DFEH's poster on transgender rights in the workplace.Given that sexual harassment allegations have permeated every industry and have dominated the news cycle - employers must be vigilant in providing anti-harassment training, investigating complaints, and taking prompt corrective action. Employers should review their anti-harassment/anti-discrimination trainings and policies to ensure compliance with SB 396.The Equal Pay Act now applies to both public and private sector employers (AB 46).Existing law prohibits employers from paying workers of one sex/race more than the workers of the opposite sex/race for "substantially similar work," unless the employer can show that any pay gap is justified. AB 46 amends Labor Code section 1197.5 by extending the definition of employer. The Equal Pay Act will now apply to both public and private sector employers. That said, employees still cannot sue public sector employers for penalties under Labor Code section 1199.5.Emeryville requires employers to offer additional work hours to current qualified part-time employees before hiring new employees or using contractors (Emeryville Fair Workweek Ordinance).Emeryville has enacted its Fair Workweek Ordinance which became effective on July 1, 2017. Under the Ordinance, employers must offer additional work hours to current qualified part-time employees (those with fewer than thirty-five hours of work in a calendar week) in writing before hiring new employees or using contractors or staffing agencies. In addition to being qualified to do the work, covered employees are those who perform at least 2 hours of work within the geographic boundaries of the city in a week; and qualify as an employee entitled to minimum wage under the Labor Code. Also, employers must provide new employees with good-faith written estimates of their work hours and schedules. Employers must provide employees with at least two weeks' notice of their actual schedules; notify employees of schedule changes and allow employees to decline schedule changes made without two weeks' notice; pay employees a premium for schedule changes made with less than two weeks' notice; ensure that employees have at least eleven hours off between shifts; and allow employees to request flexible work arrangements without retaliation.San Jose requires employers to offer additional work hours to existing qualified employees before hiring additional employees or subcontractors, and use a transparent and nondiscriminatory process to distribute work hours among existing employees (San Jose Opportunity to Work Ordinance).San Jose has enacted its Opportunity to Work Ordinance which became effective on March 13, 2017. Under the Ordinance, employers must offer additional hours of work to existing employees who (in the employer's good faith and reasonable judgment) have the skills and experience to perform the work before hiring additional employees, subcontractors, temporary services or staffing agencies, and use a transparent and nondiscriminatory process to distribute work hours among existing employees. In addition to being qualified to do the work, covered employees are those who, in a calendar week, perform at least two hours of work for the employer; and who qualify as an employee entitled to the California minimum wage, or is a participant in a Welfare-to-Work Program. A Welfare-to Work Program means the CalWORKS Program, County Adult Assistance Program (CAAP) which includes the Personal Assisted Employment Services (PAES) Program, General Assistance Program and any successor programs that are substantially similar.Please contact us if you would like to discuss any of the issues presented in this Update.JMBM's Labor and Employment attorneys counsel businesses and management on workplace issues, helping to establish policies that address problems and reduce job-related lawsuits. We act quickly to resolve claims and aggressively defend our clients in all federal and state courts, before the Department of Labor, the NLRB, and other federal, state and local agencies, as well as in private arbitration forums. We represent employers in collective bargaining negotiations and arbitration.This Update is provided to our clients, business associates and friends for informational purposes only. The Update included only brief descriptions of the laws at issue. Legal advice should be based on your specific situation and provided by a qualified attorney.
Article by Martin H. Orlick

ADA Compliance & Defense Lawyer Update: 99 ADA lawsuits dismissed as fraudulent and malicious

JMBM ·21 November 2017
On October 26, 2017, a judge dismissed 99 ADA lawsuits, ordered an in forma pauperis plaintiff (a person without funds to pursue the cost of a lawsuit) to pay filing fees of $38,300 and authorized the defendants to file fee and sanction motions.Surely, this plaintiff's lawyer rues the day she answered an ad on Craigslist looking for a civil rights lawyer to file ADA litigation in her jurisdiction.What's going on?A Strange Set of CircumstancesThe Arizona-based organization, Litigation Management and Financial Services, Inc. (LMFS), a descendant of the notorious ADA plaintiffs' group Advocates for Individuals with Disabilities, used Craigslist, indeed.com and other online media to find and engage disabled plaintiffs to file ADA lawsuits, and lawyers to represent them. The online advertisements resulted in hundreds of ADA lawsuits filed against businesses in New Mexico, Nevada, Colorado and Utah.It is also how a disabled plaintiff and her lawyer came to file 99 ADA lawsuits in New Mexico, alleging each defendant's business violated the ADA and related anti-discrimination laws. According to court documents, the deal LMFS made with this plaintiff and her counsel, worked like this:The plaintiff was paid $50.00 per lawsuit filed.The plaintiff's counsel received $100 per filing for serving as counsel of record for each lawsuit filed.LMFS drafted all pleadings and defended any motion practice in exchange for the lion's share of any settlements that resulted from the lawsuits.LMFS also arranged for a driver to take the plaintiff to some -- but apparently not all -- of the businesses that were sued, for a photo-op.What the Court LearnedWhen the Court discovered that the plaintiff and her lawyer had filed 99 cases without paying filing fees (requesting fee deferrals based on the plaintiff's in forma pauperis status), the Article III Judge instructed the Magistrate Judge to investigate the circumstances. The plaintiff's counsel appeared at the hearing held by the Magistrate, but the plaintiff missed her bus and failed to appear (despite allegedly appearing at the sites of the 99 businesses she sued). Although the Court continued the hearing to a later date, the plaintiff's counsel took the opportunity to disclose the financial arrangement, including the fee agreement, she had entered into with LMFS in which LMFS agreed to pay all costs of the lawsuits, including filing fees. The Court ordered the plaintiff's counsel to produce a copy of her funding contract with LMFS, and the plaintiff and her counsel were ordered to appear and testify at an Order to Show Cause hearing into the fee waivers and the merits of the case.The HearingAt the continued hearing, the Court examined the plaintiff and her lawyer about the merits of the lawsuit and their relationship with LMFS. The plaintiff conceded that she did not visit a number of the businesses she sued and testified that she believed the lawsuits were "frivolous". The plaintiff's counsel was examined intensely about her fee sharing agreement with LMFS and LMFS' agreement to pay all costs, including filing fees. The counsel conceded the fact that the plaintiff had the financial resources to pay her filing fees through the LMFS fee sharing agreement.The Magistrate's Report, Findings of Fact and RecommendationsThe Magistrate Judge issued a report of findings and recommendations, finding that the lawsuits were malicious and should be dismissed. The report recommended that the plaintiff pay filing fees of nearly $35,000. The report left open the issues of sanctions, defense fees and costs.The Trial Court's DismissalAdopting the Magistrate's Report, Findings of Fact and Recommendations, the trial court dismissed the lawsuits as frivolous and malicious and ordered the plaintiff to pay filing fees of $38,300. The Court authorized the defendants to file motions for fees and sanctions against the plaintiff and her counsel, as well as third-party complaints perhaps against LMFS.Who are the Victims?Some suggest that these lawyers and plaintiffs who answered ads on Craigslist are the unwitting victims of LMFS, and did not intend to file malicious litigation. But abusive ADA litigation cannot be condoned under any circumstances. For decades, certain ADA plaintiff groups (though, not all) have attacked countless business owners, large and small, over often-minor infractions that could be quickly resolved. They have clogged an overworked court system with unnecessary litigation. And, in their quest to make an easy buck, they have done a tremendous disservice to the disabled community, which deserves better representation.This article was first published on Hotel Law Blog.
Article by Bob Braun

Homeland Security Warns Against Threats to US Infrastructure

JMBM ·30 October 2017
July was another notable month for hotel data breaches - on a single day, several well-known hotel brands and managers, including Four Seasons, Trump Hotels, Hard Rock Hotels & Casinos and Loews Hotels all announced that customer data may have been compromised as a result of a security failure. Each of the incidents is related to Sabre Hospitality Solutions' credit card data breach in its SynXis hotel-reservations system, which Sabre first announced in a quarterly filing with the Securities and Exchange Commission on May 17. Based on Sabre's investigation, Sabre announced that the breach was contained to "a limited subset of hotel reservations," but the incident did allow an unauthorized party to access cardholder names, payment card numbers, card expiration dates, card security codes for some, and, in some cases, guest name, email, phone number and address.Moreover, the duration of the breach was long quite long. Sabre's investigation determined that the unauthorized party first obtained access to payment card and other reservation information on August 10, 2016, and the last access to payment card information was on March 9, 2017. The hackers had potential access for seven months.Hotel owners and consumers are, unfortunately, common victims of security breaches - all of the major hotel brands and managers have been breached, often multiple times. In analyzing the breaches, there is something that is common to almost all incidents: the vulnerability was not with a hotel, its manager or brand, but with a vendor.Hotels are not alone, of course in relying on vendors. Companies in other high threat industries like finance, retail, and healthcare regularly work with third party vendors, and these third parties commonly have access to their clients' systems and may share or store clients' sensitive and highly-valued data. But this Sabre breach (and those of the past several years) shows us that no matter how well-protected a hotel is from a direct cyberattack, its networks and data may still be easily accessed through third parties with weaker cybersecurity protections. In one of the most famous (or infamous) breaches, the 2013 breach of Target, cybercriminals were able to steal the retailer's sensitive data by accessing its systems with credentials stolen from a vendor responsible for Target's HVAC systems. Similarly, in 2017, thieves stole Netflix's "Orange is the New Black" episodes from an audio post-production company, not from Netflix itself.The typical hotel management or franchise agreement requires the owner to abide by or adopt data security policies and procedures in conformance with the brand's or manager's standards and to comply with data security laws and regulations. As a result, even where an incident is the result of the manager's or brand's failure to adopt or maintain appropriate standards, the owner will likely be directly liable for a breach, and may be obligated to indemnify the brand or manager for any claims arising from a breach.Hotel owners are at a particular disadvantage compared to other companies, since hotel brands and mangers typically select vendors, like Sabre, for multiple properties and often for an entire brand. Hotel owners may have little, if any say, in the vendor, the terms of engagement, and the impact of a breach. However, under the typical hotel management or franchise agreement, the hotel owner is required to bear the cost of a breach, whether in terms of direct costs (including notifying potential victims and the increased cost of cyberliability insurance) and the indirect cost of diminished trust in the hotel.While managers and brands are reluctant to cede authority to owners, owners should take active steps to protect themselves and their properties:Review data security policies and procedures critically, and require changes where the policies don't reflect current laws and regulations and, most importantly, current cyber-threats. Training programs should include a strong cybersecurity and monitoring for implementation and effectiveness. Most incidents can be traced to human error or malicious intent, not solely to technical systems.Require brands and managers to impose security requirements on vendors and to ensure that vendors take responsibility for the cost of a breach.Analyze cybersecurity policies to confirm that they adequately cover direct and third party costs of breaches. Since insurance is often one area where a hotel owner has greater control, it can be used as a lever to create a more secure environment.Require that brands and managers develop and test effective backup systems; while theft of data is expensive and embarrassing, newer strains of ransomware, wiperware, and fileless malware have the ability to destroy business records, and only a functional backup system can protect the hotel and its business.
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Homeland Security Warns Against Threats to US Infrastructure

Hotel Law Blog | By Jim Butler·25 October 2017
Cybersecurity breaches and risk management continue to be a concern for businesses of all sizes and types. A recent warning distributed by the U.S. Department of Homeland Security and the FBI regarding targeted hacks in several critical industries is an illustration that anyone can be vulnerable such tactics, including the hospitality industry. My partner Bob Braun, senior member of JMBM’s Global Hospitality Group® and co-chair of JMBM’s Cybersecurity and Privacy Group, summarizes the recent report and its conclusions below.

It's Budget Season. What are you doing about it?

JMBM ·16 October 2017
Importance of budgetsIt's hard to overstate the importance of a budget in the relationship between a hotel manager and owner. The budget is the way that a manager describes, in black and white, how it plans to operate the owner's property; it is the document that translates operating standards into action, and how the owner can expect to profit from the manager's efforts. It is also an important opportunity to be sure that the operator is giving due consideration to the owner's financial expectations and/or exit strategies.Many of the larger independent management companies present a budget with little opportunity for dialog. In significant part, they diminish the direct impact of asset and property management teams. This means people sitting in an office 3,000 miles away make key budget decisions for properties that they have not seen or on markets they have not visited, based on STR reports and raw data. Generally, one would think that the property-level asset management team would be the best to guide the budget process because of their hands-on knowledge - not the corporate budgeting team.Budget challenges owners faceUnless owners have a wealth of operating experience or hire experienced asset managers, they will likely be at a severe disadvantage when they review budgets. Consider typical challenges of the budget timing and process:Managers typically deliver budgets to owners in early- to mid-November, which leaves only 45 to 60 days before the beginning of the new fiscal year. While an owner may be able to analyze and comment on the budget and propose changes, the process itself is lengthy and makes it difficult to complete in a timely manner. Operators have scheduling conflicts during that busy period, and typically take two to three weeks, or more, to prepare a response for the owner's review. Managers work on budgets almost year-round, and larger management companies have staffs that are dedicated solely to creating budgets. They have developed expertise in creating a budget that owners can only match by expending the necessary time and expertise, which takes a commitment that many owners don't understand; after all, didn't they already engage a manager for its expertise?No matter the level of owner approval rights - which range from what might be complete control to very limited influence - managers run the budget process and establish the assumptions underlying the budget, making it difficult to make changes. Leveling the playing field requires owners to engage asset managers to conduct a "shadow" budgeting process.The budget for any single year will impact budgets for years to come. While budgets are generally "zero-based," a budget for any given year is more realistically derived from the budget for the prior year, and budgets ultimately contain a variety of "legacy" items. While the old budget should, reasonably, provide a setting for the new budget, a variety of factors should (but often don't) get adequate consideration, including new labor agreements or laws, renovations and their implications, new supply, addition of new product internally (such as restaurants or bars), and outside influences, such as changes in the convention market and other drivers for the hotel market.Operators rarely provide great detail on the most significant cost to owners - labor expenses - and therefore do not give owners the opportunity to identify potential savings. Similarly, operators often give greater weight to occupancy than rate, which may actually reduce the profitability of a hotel.Owners should be proactive in the budget processBecause budgets are provided so late in the year, and with so little time to review, owners should do more than simply wait for them to be delivered. Owners should take steps not only to be ready for to review and comment on the budget promptly, but to become more involved in the entire budget process.So what should the owner do? First, treat the budget process like the manager does - as a continuing, proactive process, not a reactive exercise. Start considering how the budget should be shaped long before the manager delivers its proposal. Owners should consider providing objectives to the operator at the start of budget process as a way of expediting the process. In others words, provide the operator with a standard that ownership will accept in advance.Some good questions for owners to askOwners should look at the hotel and its results for the current year , and consider some key issues:What worked at the hotel? Where did the hotel stand out, whether it be in occupancy, achieving a high room rate, managing expenses, food and beverage or meeting revenue, and so on? New operator policies on staffing, new brand standards that can add hundreds of thousands of dollars to hotel operating costs.Just as importantly - perhaps more importantly - what didn't work? Was occupancy unreasonably high? Was the hotel unable to compete with its peers on rate? Did the hotel derive meaningful revenue from its restaurants, spa or other facilities? Are there new marketable products that need to be added to the hotel, such as F&B outlets or conferences centers? Should some facilities be leased or operated by third parties, like parking and restaurant operations?Remember that revenue per available room, the most common yardstick for a hotel's profitability, only tells part of the story. Is the hotel catering to the right mix of clients in order to meet and exceed budgets and owners' financial expectations?Does the current budget actually reflect current operations - how closely did the budget's forecast expenditures and revenues match results? This simple question may lead an owner to give greater, or lesser, weight to a manager's assumptions. Asset managers often meet with owners and operators monthly to cover payroll, costs and revenue assumptions. Analyzing those trends currently gives owners an advantage over waiting until budget time to evaluate operator performance.Did the manager propose revisions to the current budget? Did the manager revise the budget without approval? Has the manager (or brand, if the hotel is under a franchise) proposed or implemented changes to its programs? Managers and brands regularly revise centralized services, shared services, marketing programs, personnel, compensation and benefit programs and so on. All of these changes will need to be incorporated into a budget, and an owner should consider their impact early. Owners should also question whether there are changes planned for the coming year to make sure the manager incorporates those into the budget.Are there changes that the owner wants to implement in the coming year? Should there be changes to staffing, revenue management, programming or operations?Having addressed these issues early, an owner is in a position to approach the manager early in the budget process to make the manager aware of the issues that need to be addressed in the budget or, at a minimum, to respond promptly and effectively to the manager's proposal.Finally, the owner should require the manager to meet with the owner and its representatives to discuss the budget. Simply submitting comments is unlikely to be enough to effect real change; there needs to be interaction between the owner and manager.ConclusionWhile some owners have the resources to take these steps, most owners do not, and should consider engaging advisors, including experienced asset managers, to assist in the process. In addition, while a manager's failure to meet budget projections is rarely a breach of a management agreement, the budget process is a key element to the manager's performance; where issues exist with a manager's performance, legal counsel should be consulted to ensure that all of the owner's alternatives are considered.At the same time, waiting until receiving the budget is a practice doomed to failure. Using a golf analogy, the reason that golfers keep score on every hole is so they can clearly understand their performance long before the game is finished and can make adjustments after every hole. Likewise and owner needs to evaluate his operator's performance weekly and monthly. They should not wait until budget time to see whether the operator has passed or failed.The JMBM Global Hospitality Group works hand in hand with owners and their asset managers and other advisors during the budget process. We work to craft management agreements that ensure that the budgets are meaningful in content and delivered in time to allow for true analysis. After the management agreement is completed, we assist in analyzing the performance and responsiveness of managers to protect owners on an ongoing basis.
Article by Jim Butler

How to avoid litigation on Resort Fees and other mandatory hotel charges

JMBM ·13 October 2017
In evaluating what you should do about the new furor over mandatory hotel charges, it would be helpful to have a clearer understanding of what the FTC seems to be saying on the issue. The chart below is our translation into "street English" of the FTC pronouncements discussed earlier. (See How Resort Fees became an explosive $2.7 billion issue which contains links to the original FTC press release of November 29, 2012 and the most recent FTC Economic Analysis of Hotel Resort Fees of January 2017.)We believe we understand what the FTC is saying. We may not agree with it. We do not know whether the Trump administration will rein in the FTC on its perceived mission regarding resort fees, and we do not know whether the current FTC position will be upheld as a valid interpretation of the law. However, courts normally accord great deference to the interpretation of agencies charged with administering their laws, and it is imprudent to ignore the FTC's recent actions.In weighing options, even if they ultimately win on legal issues, hoteliers should also consider the negative effects of litigation -- including direct costs in terms of legal fees, senior management time, and good will. And there are a number of worrisome plaintiffs who may pursue the issue, including the FTC, State Attorneys General, other governmental and consumer groups, and class action plaintiffs' lawyers. Any victories by the hotel industry may be largely offset by the costs to obtain them.So what are your options on mandatory Resort Fees?The basic thrust of the actions by the FTC, the investigation by the State Attorneys General and most consumer class action suits is that it is a deceptive and misleading business practice for hotels to advertise their room rate online unless the first and most prominent price given includes all mandatory Resort Fees and other charges. They say that it is not sufficient to give the room rate and then have a less prominent disclosure of additional charges.The issue here is really about what disclosure must be made and how it should be made if you charge mandatory fees that are not included in the room rate you quote in advertising and online.For the sake of argument, let's say that the FTC position expressed in the January 2017 analysis was "the law" or that for business reasons you want to develop policies and procedures for Resort Fees that should avoid these Resort Fees issues. The following matrix provides a general guideline as what to options or approaches you might take and the corresponding disclosures.Key terms used in the matrixIn the matrix below, "Fees" is used as a shorthand expression for all mandatory fees and charges, i.e. resort fees, service fees, amenity fees, surcharges or other non-optional charges to the guest which are not included in the quoted room rate."Total Price" means the total of room rate plus any mandatory fees or charges as a single sum. For these purposes, Total Price does not include applicable taxes because we are not aware of any claim that taxes are a necessary part of price disclosure, although one can imagine such a claim being made. Taxes are distinguishable from other Fees or charges for services in that they are a direct pass through of governmental impositions which must be paid over to third parties, they are not at the discretion of the hotel, and they do not benefit the hotel.Resort Fee Litigation Exposure Matrix(mandatory fee options and necessary disclosures) Policy on Fees What is disclosed and how Legal issue? No Fees Total Price (i.e. in this case, it is the room rate) No issue No Fees Charge only for services used (i.e. optional with guest usage) Total Price (i.e. in this case, it is the room rate)No disclosure on optional services required in online ads No issue Charge FeesTotal PriceTotal Price must be the first and most prominent price No issue Charge FeesList Fees separately breaking out Total Price to show room rate and Fees Total PriceTotal Price must be the first and most prominent priceAfter Total Price (or right next to it), disclose portion of cost that is mandatory fee No issue as long as Total Price is first and most prominent price Charge Fees Room rate is first price mentioned and Total Price and/or Fees are disclosed later or in smaller or less prominent font YESThis is drip pricing; the current hot issue with the FTC and 47 State Attorneys GeneralWe also expect this will likely trigger a new wave of class action claims Remember: Resort Fees are not illegal. This is all about disclosure.For the last two decades -- as long as this issue has been rankling consumers and government agencies -- no one has ever suggested that mandatory fees are illegal or improper! The only issue is about the disclosure that must be given on pricing.So even if a hotel decides to take the most conservative approach on disclosure, the hotel can still charge the Resort Fee and display this charge separately. The Uniform Standards of Accounting for the Lodging Industry, 11th edition, provides that these mandatory charges are not accounted for as rooms revenues (but rather as "Miscellaneous Income"). Therefore, the significant mandatory fees should still be exempt from various charges on "rooms revenues" such as transient occupancy taxes, franchise fees, frequent traveler program charges and the like. And hotels can still provide their guests with a big bundle of amenities and value at a discounted price.The biggest problem for a hotelier in moving to position advocated by the FTC and consumer groups is the competitive disadvantage when consumers compare pricing online. The first hotels listing Total Price as the first and most prominent price may lose business to those that list only room rate with mandatory fees in the fine print. But that is part of a different discussion for another day.For more information about Resort Fee issues, including the latest updates, go to www.HotelLawBlog.com, scroll down the right-hand side under LEARN MORE ABOUT and click on "Resort Fee Litigation" where you will find all the articles on the subject.
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Hotel Lawyer: Tips on negotiating your annual hotel budget

Hotel Law Blog | By Jim Butler· 9 October 2017
It is budget season again — that time when operators and owners sit down to agree on the financial blueprint for the next year. My partner Bob Braun has worked on many hundreds of hotel management agreements and issues arising under them. Today, he shares some insights about the how to maximize the budget opportunity for constructive dialog between owners and operators.

Resort Fee Litigation Advisory Group: How Resort Fees became an explosive $2.7 billion issue

Hotel Law Blog | By Jim Butler· 6 October 2017
Resort Fees are a $2.7 billion issue — a juicy target for Federal and State governments as well as plaintiffs’ lawyers. It is very likely that the Resort Fee issue will present challenges in the near future to all stakeholders in the hospitality industry. The prior articles in this series talked about what Resort Fees are, and key developments that warn of an eruption of government and private claims over Resort Fees.

Resort Fee Litigation Advisory Group: National task force of 47 Attorneys General goes after Resort Fees

Hotel Law Blog | By Jim Butler· 3 October 2017
esort Fees: It is not just the FTC. Now there are 47 Attorneys General focused going after perceived abuses of Resort Fees Consumer complaints have been protesting Resort Fees for almost two decades. In 2012, the FTC took its first major action. The hotel industry took some action, but many consumer groups and regulators apparently don’t think it is enough. In May 2016, a national investigation was initiated by the Attorneys General of 46 states and the District of Columbia as to whether DC’s consumer Protection Procedures Act (the “CPPA”) and similar acts of other states have been violated by deceptive price advertising techniques related to drip pricing regarding Resort Fees.
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Resort Fee Litigation Advisory Group: An eruption of government and private claims over Resort Fees? Part 1 - The FTC 2017 Report

Hotel Law Blog | By Jim Butler·29 September 2017
Two significant developments may signal an eruption of government and private claims over Resort Fees — (1) publication of the FTC 2017 Report and (2) commencement of proceedings regarding Resort Fees by a national task force of Attorneys General for 46 states plus the District of Columbia. This article focuses on the FTC Report. The next article will discuss the national task force.
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Resort Fee Litigation Advisory Group: Impending eruption of litigation over Resort Fees?

Hotel Law Blog | By Jim Butler·25 September 2017
Impending eruption of government and private litigation over Resort Fees (mandatory service fees) There were earthquakes and tremblors for at least 17 years before Pompeii was destroyed in the catastrophic eruption of Mount Vesuvius in 79 AD. The past is prelude. What are Resort Fees?

Hotel Lawyer: Tax Alert for Partnerships and LLCs

Hotel Law Blog | By Jim Butler·18 September 2017
As of January 1, 2018 owners of General Partnerships, Limited Partnerships or multi-member Limited Liability Companies may soon find themselves economically liable for the unpaid tax of former partners/members of those entities. JMBM Tax Attorney Jamie Ogden briefly describes the new audit regime, who it affects, and what you need to do to protect yourself from uncertainties.
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Hotel Lawyers at The Lodging Conference 2017: EB-5, Mixed-Use Development and Deal Making

Hotel Law Blog | By Jim Butler·18 September 2017
The Lodging Conference is taking place at the Arizona Biltmore in Phoenix, October 30-November 2, 2017, and hotel lawyers from JMBM’s Global Hospitality Group® will be there to visit our friends in the hospitality industry, share our knowledge, learn from the experts (and do some deals!). At the conference, I will moderate the panel, Navigating the EB-5 Landscape taking place at 4:00 pm on October 31st. Funding obtained through the EB-5 Immigrant Investor Visa program continues to play a vital role in the capital stack for new hotel development and we will provide up-to-the-minute information on the status of the program, as well as share some great success stories. To get up to speed on what’s happening with EB-5, check out my recent blogs.

EB-5 Finance Lawyer: President's Trump's budget deal includes extension of EB-5 through 12-8-17

Hotel Law Blog | By Jim Butler· 7 September 2017
President Trump’s budget deal with Congress includes extension of EB-5 through December 8, 2017 In a message to members of the Public Policy Committee today, the IIUSA confirmed the extension of the EB-5 regional center program as part of the budget deal struck yesterday by President Trump and Congressional leaders.

JMBM's Global Hospitality Group Announces the Publication of an EB-5 Handbook for Developers

JMBM ·17 August 2017
LOS ANGELES -- JMBM's Global Hospitality Group(r) and EB-5 Finance Grouptm are pleased to announce the publication of The Developer's EB-5 Handbook for EB-5 Construction Financing, a "must-read" resource for developers who are considering using EB-5 financing to complete or enhance their capital stack for construction projects. This is the much talked-about and often (inappropriately) maligned EB-5 program, also known as the immigrant investment visa program.While there are many pending developments that could affect the EB-5 program, this is still a good time to learn how the program works and why so many developers have used EB-5 financing as part of the capital stack for their new projects. The Global Hospitality Group has developed an approach to guide clients through the EB-5 process with a minimal amount of financial risk to find and evaluate the reliable players and execute financing with a high degree of confidence.The Developer's EB-5 Handbook is written to help developers assess the potential opportunities for EB-5 financing while avoiding potential traps for the unwary. Written by legal and business advisors to top developers with great projects in the United States, the Handbook includes articles addressing the following topics:What is EB-5 all about? What are its essentials?Is EB-5 still viable for developers with everything going on today?How can you evaluate an EB-5 construction financing opportunity for your project?What is the optimum EB-5 construction financing structure for development projects?What drives the size and terms of EB-5 financing in the capital stack?How much? How cheap? How certain? How long?How can you spot key "show stoppers" before you get too involved?What are the most common mistakes developers make with EB-5 financing?Who do I need on my EB-5 financing team?To download a free copy of The Developer's EB-5 Handbook, go to the Resource Center on HotelLawyer.com.If you would like to discuss any of the issues presented in the Handbook, please contact us:
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EB-5 Finance Lawyer: The Developer's EB-5 Handbook is now published

Hotel Law Blog | By Jim Butler·15 August 2017
JMBM’s Global Hospitality Group® and EB-5 Finance Group™ are pleased to announce the publication of The Developer’s EB-5 Handbook for EB-5 Construction Financing, a “must-read” resource for developers who are considering using EB-5 financing to complete or enhance their capital stack for construction projects . This is the much talked-about and often (inappropriately) maligned EB-5 program, also known as the immigrant investment visa program.
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EB-5 Financing Lawyer: What JMBM does to help developers with EB-5 financing

Hotel Law Blog | By Jim Butler· 6 August 2017
Client confidentiality precludes us from listing clients and projects we have assisted with this program, but suffice it to say that some of the best known names in the business are tapping into this funding source to fill out their capital stack at a favorable cost. And we have helped some of the biggest and highest profile players. JMBM has closed more than $1.5 billion of EB-5 financing and has sourced more than half of that for our development clients.
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EB-5 Financing Lawyer: Why you do NOT want to form your own regional center

Hotel Law Blog | By Jim Butler· 4 August 2017
Although the EB-5 immigrant visa program has been around since 1990, the current trend of using it as a source of financing for hotel and other real estate started 20 years later – around 2010. We worked on one of the first hotel EB-5 financings for the W Hotel & Residences in Hollywood, and we have since worked on more than 100 EB-5 projects all over the country. Now, the use of EB-5 financing for construction has gone mainstream. High profile EB-5 financing closings include $450 million for the Century Plaza Los Angeles, $100 million for the Ritz Carlton & JW Marriott in downtown Los Angeles, $150 million for the Waldorf Astoria in Beverly Hills, and $1 billion for the Silverstein project at the World Trade Center in New York City (with a Four Seasons Hotel).
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EB-5 Financing Lawyer: The 5 questions every developer is asking about EB-5 financing

Hotel Law Blog | By Jim Butler· 2 August 2017
The use of EB-5 financing has exploded over the past 8 years as an important funding source for new development – particularly for hotel developments. It is clearly now part of the “mainstream.” It is used by many institutional players, including government entities such as port authorities, major hotel brands like Marriott and Hilton, and some of America’s most successful and respected companies, such as Great Wolf Resorts, the Related Companies, and Silverstein Properties.

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