Even as deal-making activity slows and many courts and companies temporarily shutter their doors, lawyers handling a range of issues from labor and employment to health care law are scrambling to keep up with the demands of existing and prospective clients.
As the public health crisis unfolds along with changes in state and federal laws, lawyers are fielding countless calls from anxious clients seeking advice on a wide range of issues.
Restaurants and bars coping with plummeting sales must know how to renegotiate rental payments with their landlords and renegotiate loans with their lenders. Corporations need counsel on the proper protocols to follow when informing their employees of temporary layoffs and reduced hours. Health care providers are dealing with fearful health care workers and patients wary of catching the virus from the other.
“Many clients and prospective clients are coming to us for the first time in a panic and the guidance necessarily has to be live as the situation is constantly fluid,” said Alexander W. Leonard, a partner at Golenbock Eiseman Assor Bell & Peskoe, speaking about employment and labor law. Leonard said companies based in New York City and San Francisco are experiencing some of the most severe problems right now.
Andre R. Jaglom, partner at Tannenbaum Helpern Syracuse & Hirschtritt and chair of the New York State Bar Association’s Business Law Section, said labor and employment lawyers are guiding clients through a dizzying array of issues that go far beyond layoffs and leave requirements.
Privacy issues surface when an employee tests positive for the coronavirus and companies need to know how to communicate the information to other employees. One company’s security system required employees to place one of their hands up against a scanner to gain entry. Its executives needed advice when employees were uncomfortable using the scanner system, even with disinfectant wipes placed nearby. Another company sought advice on the issue of having employees bring their own bar of soap to work.
“The law is changing minute-by-minute as the governor issues executive orders,” said Jaglom. “It is a challenge to stay on top of it all. Clients need current, timely and accurate advice.”
New York State Gov. Andrew Cuomo’s directive to the state Department of Financial Services to provide 90 days of mortgage relief to mortgage borrowers impacted financially by the coronavirus, for example, has members of the association’s banking section busy. While the 90-day moratorium on foreclosures will slow mortgage collection litigation among banks, the directive has sparked all types of questions among apprehensive financial institution executives.
Jay L. Hack, a partner at Gallet Dreyer & Berkey in New York City, said the head of one bank rattled off nearly a dozen detailed questions during a recent phone call. Concerns ranged from whether the moratorium applies only to residential mortgages to what if the borrower is located outside New York yet the property is located inside New York. The implications for bank reporting requirements to the Federal Deposit Insurance Corporation and income tax reporting is another area of concern.
“For corporate, securities and advisory attorneys in the banking area, we are facing a tsunami of new issues and tweaks and nuances in issues we have been dealing with,” Hack said.
Jonathan L. Flaxer, a partner at Golenbock Eiseman Assor Bell & Peskoe, said business lawyers are now helping companies – reeling from sudden losses in revenues – renegotiate loans and obtain relief from lenders to maintain cash flow. “Cash is king,” said Flaxer, who specializes in the practice of business bankruptcy. Bankruptcy lawyers will be active down the road, said Flaxer, adding he expects bankruptcy courts to show leniency with the extraordinary circumstances.
Michael J. Riela, a partner at Tannenbaum Helpern Syracuse & Hirschtritt, agrees that corporate law experts now handling calls about the restructuring of loans and contracts will have their bankruptcy experts on hand in the future. The Small Business Reorganization Act of 2019 should help small businesses restructure and minimize bankruptcies, he added.
Attorneys involved in health care law are also very busy right now.
Hermes Fernandez, chair of the Health Law Section and an attorney at Bond, Schoeneck & King in Albany, said these attorneys are fielding requests from all health care providers, including hospitals, nursing homes and home care agencies. Clients are seeking guidance on privacy issues, the quality of care, their responsibility in ensuring health care workers have the proper protective equipment when visiting clients in their homes, and the inevitable ethical issues that will emerge if patient demand for equipment exceeds supply.
Litigation is slow now as courts have severely curtailed or reduced their operations. That will change, said Rory J. Radding, a partner at Mauriel Kapouytian Woods LLP in New York City, once the dust has settled around the current scenario.
“The virus situation is going to affect life so all legal issues are on the table,” he added.