Get used to the Peer to Peer economy

Recently, across the country as well as in New York City, the peer-to-peer economy, also known as the sharing economy, has flourished. New start-ups have been created in which New Yorkers can rent out their homes to visitors, give rides to people with their own cars, and even host dinners for travelers looking to experience something new-all for a fee, of course. Peer-to-peer startups are bringing in a significant amount of revenue to the city’s economy; and yet the city continue to serve as hindrances with its outdated regulations .

 

These industries “…combine smartphone applications and cloud-computing services with the belief that sharing conserves resources, builds community and promotes economic development.” Sidecar and Relay Rides are companies that function as personalized versions of taxi-service, have recently had their service halted due to regulations by the Taxi and Limousine Commission. The Commission assures that it doesn’t have a problem with neighborly car-pooling, but that these companies are operating as unregistered taxi services, which is illegal. Similarly, the Department of Health has notified EatWith, a company which lists various home dinners tourists can attend in over twenty countries, because “anyone serving meals for money is required to have a permit.”

It is obvious that the city is not interested in working with these Peer to Peer companies; which is unfortunate because the demand of these peer-to-peer industries is increasing. The city should be spending less time impeding the development of these innovative industries, and should spend more time fostering their growth. 

 
http://www.crainsnewyork.com/article/20130825/ECONOMY/308259963

The consumer loses when Big Business and government team up against the new guy on the block

 

A new alternative for tourists looking to stay in New York City while on vacation is popping up more frequently around the city: New York homeowners are now renting out their homes and apartments to visiting tourists at very reasonable rates.   The biggest company providing this service is Airb&b.  This innovative and inventive company is providing a viable option for tourists looking to stay in New York City without dipping too much into their wallet. One would think this idea would be championed by the city and our mayor who looks for every opportunity to bring revenue and tourism into our city. However, the opposite is in fact happening. The NYC Office of Special Enforcement, which is supposed to focus on quality of life complaints, has been utilized by the hotel industry to investigate “illegal hotels”.  The hotel industry views these rented-out apartments as “unfair competition” but what exactly is unfair about these companies?

The main issues that the hotel industry and the city have with this “shadow industry” are that the apartment-renters do not pay taxes; even though they have provided no proof of this claim.  Anyone who has visited Airb&b’s website, can clearly see that the company is the entity that handles the exchange of money and keys.  If any of the hotel industry’s claims are true, the IRS or NYS Department of Tax and Finance would easily be able to verify tax cheats. 

The hotel and the city have also indicated that the rentals of these apartments violate public safety laws. The city argues that hotels have set evacuation plans and protocol for handling emergencies that these problematic “illegal hotels” do not.  However, the city overlooks the fact that the whole reason for evacuation plans in a hotel is due to volume of people who are unfamiliar with the premises.  In an apartment rental, you are not dealing with the same volume of individuals.  Furthermore this problem can easily be rectified by mandating evacuations plans with each rental thereby alleviating the City’s fear of evacuation plans.     

As the hotel industry seeks to bring down these rental companies, one must consider who is really in the wrong. Is it right for the city to hinder the success of new businesses simply because the monopolist hotel industry feels threatened? Or should the city look to write legislation to support this budding, innovative industry? 

 

http://www.crainsnewyork.com/article/20130819/HOSPITALITY_TOURISM/130819909

Unpaid Internships: Exploitation or Valuable Opportunity?

Judge William Pauley, who sits on the United States District Court for the Southern District of New York, ruled that Fox Searchlight’s use of interns in the production of the movies “Black Swan” and “500 Days of Summer” violated minimum wage and overtime laws. 

While this decision is specific toward Fox Searchlight case, it has general implications that may put students and small business on a dangerous path.  From very early on in my college career, I took on many free internships.  I worked for a small law firm, a non-profit agency, and various other sized corporations.  At each position, I was able to do hands on work and learn about the field that I would eventually professionally enter.  From many of these internships, I still have contact with people I interned under and have developed a mentor relationships.  I can not imagine that I would be given these same opportunities if these small companies or non-profits were forced to then pay young college student. 

 

Furthermore, I would be curious to see if these same rules would be applied to government positions.  How many interns do the local city D.A.'s offices take, the U.S. Attorney's office, NYC Corporate Counsel? 

 

As a solo small firm, I was looking forward to having an intern in the office.  Someone I could mentor to one day to become my colleague.  It is how I learned to be a young attorney, and I believe it is a proven method.  However, this ruling gives me pause.  Especially for summer interns, who would normally take a 9-5 position in my office.

 

If the government pursues this ruling and begins enforcing minimum wages for internships, you may see more young adults without work experience trying to get a job in an already competitive market.  In the end, this ruling benefits absolutely no one.  

 

 

The NYC Streets where $10.00 is the most you can charge...

There was an interesting article in the WSJ this week that caught my eye.  "Good News for NYC Newstands?  Price caps could Rise."  The article, which I am attaching below, explains how the City Council is taking up a bill that would raise the cap on what a newsstand could charge for items from five dollars to ten dollars.

Looking at the article at first glance it seems like what is the big deal with such a small amount of money.  But, after a second read, am I the only New Yorker that doesn't understand why the city should regulate a newsstand?  Here we are in the greatest capitalistic city in the world and we are telling people that open up newsstands they are only allowed to sell items that can be priced under $10.00

Anyone can see why sidewalk newsstands are down from "nearly 1,600 sidewalk kiosks in the 1950s, compared with about 300 now," according to the NYC Newsstand Operators Association.  In a city where most cups of coffee cost more than $5.00, how could you expect a newsstand to make a profit where they are capped at $5.00 an item.

While I applaud the city council for understanding the rise in prices of items and raising the cap to $10.00 why not just get rid of the cap all together.  These small businesses — no bigger than 72 square feet, under city regulations, should be able to sell whatever the general public needs when walking down the streets at a market price.  The market would cap most of the products anyway because no rational person is buying expensive products from a newsstand.  But why mandate a price that you will probably have to change in another 5 years?

http://online.wsj.com/article/APc9ec23cfe19f4373a430ab266aac5127.html?mod=wsj_share_tweet   

Why would any small business want to grow?

Many New York City small-business owners will face a trio of new government regulations in the pipeline that could hit businesses all at once: an increase in the minimum wage, paid sick leave, and the Affordable Care Act (also known as Obamacare).

Out of the three, let us take a look at the paid sick leave. Under the proposed bill, the NYC Department of Health (DOH) would require small businesses (more than 5 employees) to give their employees at least five sick days a year. Business would be required, upon demand, to turn over their employment records to DOH investigators. If the Department of Health finds that an employer fired a worker for calling in sick too many times, they have the right to be compensated for at least $5,000. The proposed rules don’t require employees to provide much besides their word. An employer may not demand a physician’s note until the third day out – and of course, the employer cannot withhold pay if the worker fails to produce even such minimal documentation.

This bill will certainly hurt small business more than any other business. While I understand the desire of the government to protect workers who may fall ill during the work week, what if there was a better way to do it. What if the Government provided incentives for these types of programs for small businesses? Why not provide a tax break to a small business that create a sick pay program. It helps both sides. As you can see with the chart below, the cost of hiring one employee continues to rise, which is preventing business owners from hiring.





http://www.theepochtimes.com/n2/united-states/small-businesses-feeling-the-squeeze-in-new-york-370295.html

Give me a 20oz...but only if its beer!

Anytime you can order a 20-ounce beer, but you can't get a 20-ounce Coke; a regulation has gone awry.

Under the first-of-its-kind prohibition approved by the city Board of Health last year, establishments from restaurants to mobile food carts can't sell sugary drinks larger than 16 oz. After a three-month grace period, the city will fine violators $200 per sale.

The ban applies to all non-diet sodas, energy drinks, fruit drinks or sweetened teas that are less than 50 % milk or milk substitute and have more than 25 calories for every 8 ounces. It does not apply to to alcoholic beverages or low-calorie drinks (25 calories or fewer per 8 ounces) including diet sodas, water, unsweetened coffees and teas or vegetable and fruit juices without added sugar.

While I absolutely agree with the need to fight obesity, I am not sure this is the way to do it. Already, lawyers are thinking of clever ways to get around it. One establishment is already offering buy one get one free deals for soda which in essence allows for 20-ounce of Soda. (clever)

Our politicians need to rethink their goals in how they draft legislation. The only people this legislation is going to hurt is the owners of small business who NYC Dept. of Health is going to fine. I can think of many different ways to attack obesity without fines.

Start public health earlier on in elementary school; increase the amount of physical education in schools; or offer tax incentives for gyms. The problem with the fine system is 99% of the time it is used as a means for increasing revenue when the city needs it as opposed to a means to cure an actual health epidemic.



http://online.wsj.com/article/SB10001424127887324662404578332602130776308.html?mod=e2tw

When innovation meets regulation

I read an interesting article today about new tech startups running into problems with outdated government regulations. Three new tech companies provide the ability for NYC tourist to spend the night in private homes, which they find through websites. The rooms are cheaper than hotels and more private that hostels. Yet instead of promoting such innovation, it seems the City in their constant need for money are going after the hosts of such rooms. What is worse is they are going after these hosts with a heavy hand. In one case, the city is attempting to fine a host 30,000.00 for one night stay at 300.00 stay.

For a mayor who has been trying to make NYC the silicon valley of the east it seems odd that he would be pushing so hard against an innovate way to bring tourist dollars to NYC.

John Feinblatt, chief policy advisor to Mayor Bloomberg, noted the city has different building codes for private homes and for hotels.

“Hotels have sprinkler systems, hotels have those instructions on the back of the door that tell you how to get out during an emergency,” Feinblatt said. “Hotels have to have two means of egress. Because we know that people who stay for a week or a day or three days need these extra supports in case of an emergency.”

While true a person who is staying one or two days in a private home may not know not know the home as well as the homeowner, a private home is more than likely going to have amenities to deal with an emergency better than a hotel may have.

This is more than likely the wave of the future for going places; but more than that these are companies that have gone out of their way to help NYC. One of the companies already arranged temporary housing for more than 400 New Yorkers made homeless by Sandy. It seems we should revisit the regulations that are holding NYC back from its ability to bring new innovation here.


http://www.wnyc.org/shows/newtechcity/blogs/new-tech-city-blog/2013/feb/05/nyc-tells-airbnb-hosts-dont-get-too-cosy/

The Internet is a dangerous place.

A friend and potential client contacted me this week regarding an internet site that was posting her phone number and telling young men to call her for a good time.  The website is www.dirtyphonebook.com it allows users to post phone numbers and comments from anonymous usernames.  The client contacted me regarding my ability to take down her phone number from the website.

A cease and desist email was submitted to both the owner of the website, the company that maintains the website, and the developer of the website, all of which has gone unanswered.  A formal cease and desist letter was sent certified mail to the owner of the company to remove the phone number from the website.  This too went unanswered. 

My next option was to contact the FTC and the NYS Attorney General Office.  The problem here is the speed at which action would occur next.  The FTC first has to gather information as to how many people are complaining about this company and face the same problems as my client.  I did a quick search on Google and this company is facing multiple complaints from people around the country.  Some of the complaints are from parents whose children (under 18) have been contacted for phone sex.  Which tells me this is actually a good case for the FTC to run with but again how long will it take?

The NYS Attorney General is looking into this case as well.  I haven't dealt with the AG's office so again I am not sure what might come of this.  In the meantime my client is still receive phone calls.

I also contacted an attorney friend of mine that has handled class actions in the past.  It would seem possible with the amount of people already complaining about this website and how scattered the victims are around the country that this case may be handled as a class action. 

Anyone who has faced a similar problem with a website or is interested in joining in a class action feel free to contact my firm.

New NYS Gun Regulations

"New York lawmakers agreed to pass the toughest gun control law in the nation and the first since the Newtown, Conn., school shooting, calling for a stricter assault weapons ban and provisions to keep guns out of the hands of the mentally ill who make threats."

http://www.nbcnewyork.com/news/national-international/NATL-NY-Assembly-Expected-to-Pass-Gun-Bill--186917571.html

Most of the parts of this law are pretty basic for what people have been calling for to protect against gun violence.  The interesting section of the law covers mental health. 

"In another provision, a therapist who believes a mental health patient made a credible threat to use a gun illegally would be required to report it to a mental health director who would have to notify the state. A patient's gun could be taken from him or her."

It will be interesting to see how this would actually play out in reality.  Does this now put liability on the therapist for not reporting a credible threat?  Does the therapist have to know that the patient has a gun to act on the threats the patient makes in order to report to the mental health director?  What if the patient lives with someone who owns a gun?  Will the owners gun be taken away because of the patient? 

Hate to see the first case for this to play out.

What is in a name? (email)

Steve Anderson wrote an interesting article about what your email domain name says about you and could an outdated service like AOL be costing you clients.  According to his article he doesn't take any emails serious unless they are from a hosted email account with your own domain name. 

As an attorney I come across different email addresses all the time.  Never once did I stop to think this person doesn't know what he or she is talking about because he is sending me an email from an AOL address.  I personally use Gmail for my business and personal emails.  It is simple to use, and easy to navigate.  I think Mr. Anderson might do better to concentrate on how a person addresses his subject in an email and the quality of information he is receiving in an email as oppossed to the domain name of the email. 

Domain Names

You are the father...?

I came across this Reuter's article:

A Kansas man who donated sperm to a lesbian couple so they could have a child said on Wednesday he is shocked the state is now trying to make him pay child support.

According to the article:

"William Marotta, 46, donated sperm to Jennifer Schreiner and Angela Bauer under a written agreement that he would not be considered the father of the child nor liable for child support. A daughter, now 3, was born to Schreiner. But in October, the state of Kansas filed a petition seeking to have Marotta declared the father of the child and financially responsible for her after the couple encountered money difficulties."
Child Support claim against sperm donor

While this may sound like an odd case, odder things have happened in NYC and NY courts have an even stricter approach to dealing with "donations."

In New York: Contracts regarding sperm donation between a couple and a donor are generally unenforceable, and the court will only look at the best interests of the child in determining the rights and duties of the donor.

As the old saying goes, no good deed goes unpunished... so when the child support bill arrives at your door, don’t be surprised if you have to pay it.