Legal News for Fri 8/9 - DACA ACA Challenge, IRS Resumes ERC Claims, EPA Safeguarding Work Ahead of Trump Return, and Milbank Summer Bonuses

Minimum Competence

This Day in Legal History: Webster-Ashburton Treaty

On August 9, 1842, the United States and Great Britain signed the Webster-Ashburton Treaty, which played a crucial role in resolving longstanding boundary disputes between the two nations. The treaty, negotiated by U.S. Secretary of State Daniel Webster and British diplomat Lord Ashburton, focused on the contentious northern borders of Maine and Minnesota.

For years, tensions had simmered over the unclear boundary lines established by the Treaty of Paris in 1783, particularly in the area known as the Aroostook region of Maine. The Webster-Ashburton Treaty provided a compromise that defined the Maine-Canada border, with the U.S. gaining 7,015 square miles of territory and the British securing a vital trade route. Additionally, the treaty clarified the boundary along the Great Lakes and reaffirmed the 49th parallel as the U.S.-Canada border west of the Lake of the Woods.

Beyond territorial matters, the treaty also addressed issues of extradition and the suppression of the slave trade, marking a significant step in Anglo-American diplomacy. The successful negotiation of the treaty helped ease tensions between the two powers and set a precedent for future peaceful resolutions of international disputes.

A coalition of 15 Republican-led states, spearheaded by Kansas Attorney General Kris Kobach, has filed a lawsuit aiming to block a Biden administration rule that allows up to 200,000 DACA recipients to access federal health insurance programs. The rule, implemented by the Department of Health and Human Services (HHS) in May, designates DACA participants as "legally present," thus qualifying them for healthcare benefits under the Affordable Care Act (ACA).

The states argue that this classification contradicts federal law, which prohibits providing public benefits to individuals without legal immigration status. They contend that the rule encourages illegal immigration and imposes financial burdens on states by necessitating the provision of additional public services. In a related move, Texas Governor Greg Abbott issued an executive order to track the state's costs associated with providing medical care to undocumented immigrants. The lawsuit reflects ongoing tensions surrounding immigration policy, a contentious issue as the 2024 presidential election approaches.

US states sue over Biden rule extending health insurance to DACA immigrants | Reuters

The IRS has resumed processing certain Employee Retention Tax Credit (ERC) claims that were paused during the pandemic, specifically those filed between September 14, 2023, and January 31, 2024. The agency will focus on processing claims it deems either high or low risk. The decision to start with these claims aligns with a recent bipartisan tax bill that aimed to end the ERC program early, though the bill is unlikely to become law this year.

The IRS halted the processing of new claims after September 14 due to a surge in claims and concerns over fraudulent filings by third-party companies. Many eligible taxpayers have experienced long delays in receiving their payments. The IRS plans to process 50,000 low-risk claims beginning in September and anticipates sending out another significant batch of payments in the fall. Additionally, the IRS issued 28,000 disallowance letters for high-risk claims, potentially preventing $5 billion in improper payments. However, some tax professionals reported errors in these letters, leading the IRS to promise adjustments and better support for affected taxpayers.

IRS Reopens Processing Some Covid-Era Claims, Pays Out More Cash

Environmentalists and career staff at the Environmental Protection Agency (EPA) are taking steps to protect the agency's work from potential political interference, particularly if Donald Trump is re-elected. Concerns stem from Trump's first term, during which political appointees frequently overruled scientific findings. To mitigate this, the EPA and its largest union have ratified a new contract allowing staff to report violations of scientific integrity without fear of retribution.

However, despite these protections, there remains significant worry about the extent to which a future Trump administration could reshape the agency, especially given plans outlined in the Project 2025 blueprint, which proposes adding politically appointed oversight roles within the EPA. The agency faces challenges as Trump's allies advocate for policies that could allow the firing of federal employees en masse and the weakening of scientific safeguards.

Historically, political interference has affected EPA work, with an unprecedented number of scientific integrity violations recorded during Trump's first term. The Biden administration has taken steps to protect its environmental regulations, but there are concerns that these could be rolled back or challenged in court under a future Trump presidency. Additionally, the possibility of a mass exodus of EPA staff if Trump returns to power could further weaken the agency's ability to operate effectively.

EPA Staff Move to Safeguard Work Amid Worries of Trump’s Return

Milbank LLP is awarding special summer bonuses to its associates and counsel, with amounts ranging from $6,000 for first-year associates to $25,000 for more senior staff. This decision reflects the firm's busy workload in the first half of the year and anticipates continued high demand. Milbank, which previously led the market in raising associate salaries, is likely prompting other law firms to follow suit in offering similar bonuses to remain competitive. However, industry experts caution that not all firms are financially positioned to match these bonuses, despite market optimism following recent financial market fluctuations. While some firms may struggle to keep up, others see this move as a positive indicator for future revenue growth.

Milbank Hands Out Summer Bonuses for Associates and Counsel (1)

This week’s closing theme is by Frédéric Chopin.

This week, we’re closing our episode with a piece that holds special significance, especially for my co-host, Gina, who is celebrating her birthday on August 10th. As a birthday tribute to her, we’ve chosen to feature her favorite classical piano piece: Frédéric Chopin’s Nocturne No. 2 in E-flat major, Op. 9, No. 2.

Frédéric Chopin, a Polish composer and virtuoso pianist of the Romantic era, is widely regarded as one of the greatest composers for the piano. His music, known for its lyrical beauty and emotional depth, captures the essence of the Romantic spirit. The Nocturne No. 2, composed when Chopin was just 20 years old, is one of his most beloved works. It’s a piece that perfectly showcases his ability to combine delicate, flowing melodies with rich, expressive harmonies.

The Nocturne is both gentle and introspective, with a melody that seems to float effortlessly over a soft, arpeggiated accompaniment. Its serene, almost dreamlike quality invites listeners to lose themselves in the music. This piece, with its subtle nuances and lyrical grace, is a testament to Chopin's genius and a perfect way to celebrate Gina’s special day.

So, as we conclude today’s episode, sit back, relax, and enjoy the timeless beauty of Chopin’s Nocturne No. 2, a fitting tribute to both the composer and to Gina on her birthday. Happy Birthday!

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