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To our friends, clients and colleagues in local and regional government, higher education and the nonprofit sector, welcome to our latest Monday Message from the Public Law Group at McDonald Hopkins. In today’s email, assembled by attorneys Margaret O’Bryon, Kelsey Smith, Amy Wojnarwsky and Kevin Butler, you’ll find insights into areas of law we’re watching on your behalf.

In today’s edition:

Exploring benefit corporations as a new type of Ohio entity
Additional relief coming to nonprofits, higher ed, residents via state
After Sixth Circuit ruling, how can governments selling ad space regulate ad content?
Ohio workers’ comp updates: voluntary abandonment of claims

Exploring benefit corporations as a new type of Ohio entity

Last month the Ohio House informally approved S.B. 21, which will allow a corporation to become a benefit corporation in the state. Benefit corporations are those whose stated purposes must include having positive effect artistically, charitably, culturally, economically, educationally, environmentally, literarily, medically, religiously, scientifically, or technologically for those other than their shareholders.

The benefit corporation movement continues to expand, with 37 states currently permitting this type of state-level entity. Today Amy Wojnarwsky provides an overview of how a benefit corporation differs from other corporations, and how it relates to third-party “Certified B Corps.” Read more from Amy here and stay tuned for future Monday Messages regarding the enactment and rollout of this legislation in Ohio.

Additional relief coming to nonprofits, higher ed, residents via state

Late last week Ohio Gov. Mike DeWine announced the development of an additional $419.5 million relief package created from CARES Act funding. The funding will be allocated to assist entities and sectors, including small businesses, restaurants and bars, hospitals, higher education, arts, nonprofits, and low-income Ohio residents who continue to be negatively impacted by the ongoing COVID-19 pandemic. The package, which was prepared in part by Gov. DeWine’s administration and the General Assembly, includes the following distributions:

Small businesses: $125 million of CARES Act funding will be allocated to small business with no more than 25 employees to assist with various expenses, including but not limited to, mortgage and rent payments, salaries, and business supplies. Applications for the Small Business Relief Program will be available on Nov. 2, 2020, at businesshelp.ohio.gov.
Ohio residents: Ohioans with an annual income at or below 200% of the federal poverty guidelines and who are behind on their bills due to COVID-19 may be eligible to apply for assistance starting November 2, through their local Community Action Agency. The new package provides an additional $50 million to 47 Community Action Agencies to assist Ohio residents with rent, mortgage, or utility payment assistance.
Bars and restaurants: In order to assist one of the hardest hit industries, the new package allocates $37.5 million to the Bar and Restaurant Assistance Fund. The fund will provide up to $2,500 per unique business location to businesses with an on-premise liquor consumption permit. Businesses must have an active on-premises permit by October 23, to be eligible to receive funding. Applications for assistance will be available on November 2, at businesshelp.ohio.gov.
Hospitals: An additional $62 million in CARES Act funding will be made available to rural and critical access hospitals and may be used for additional safety measures, including the purchase of personal protective equipment.
Higher education: The new package includes $100 million in funding to Ohio universities and colleges to assist with balancing the return of students and the proper response to COVID-19. The funding may be used for extended COVID-19 response, including additional testing for students, faculty and staff, and mental health services.
Nonprofits and the arts: In addition to the above funding, $25 million in CARES Act funding will be provided to Ohio nonprofits and $20 million to support Ohio’s art organizations.

The package is expected to be approved by the state controlling board today, October 26.

After Sixth Circuit ruling, how can governments selling ad space regulate ad content?

Those whose local governments, recreation departments and public education entities offer paid space to private advertisers were provided a refresher Friday on the limitations they may place on the content of those ads.

In American Freedom Defense Initiative v. Suburban Mobility Auth. for Regional Transp. (SMART), the Sixth Circuit Court of Appeals struck down standards regulating private ads placed in buses and shelters operated by the regional public-transportation system around Detroit – namely, rules barring “political” advertising and content that is “likely to hold up to scorn or ridicule any person or group of persons.” Those two regulations, the court found, violated the First Amendment rights of the advertiser, which wished to point Muslim bus patrons to the website RefugeFromIslam.com.

The court began its opinion with a primer on the three types of forums – traditional public forums, designated public forums and nonpublic forums – in which private parties engage in speech on government property, as well as the breadth of restrictions the government may impose on speech in each forum. A government is allowed to impose the most restrictions on speech in nonpublic forums like government ad spaces – places that historically haven’t been offered for First Amendment-protected public communication. But those restrictions must still be “reasonable” (that is, not subject to multiple interpretations by different people), the court wrote, and they must be free from “viewpoint discrimination” (prejudice against certain points of view on a particular subject).

The court found that the transportation authority’s restrictions on “political” advertising were unreasonable because they offered no “sensible basis for distinguishing what may come in from what must stay out.” All “political” content – as opposed to more clearly defined political-campaign ads, for example – has “a range of meanings” too vast to pass muster. Furthermore, the court found that the authority’s restriction on content subjecting a person to “scorn or ridicule” is a form of unlawful viewpoint discrimination because it authorizes ads promoting people or groups but would ban ads disparaging the same people or groups. “This restriction,” the court wrote, “necessarily discriminates between viewpoints.”

The case should be an eye-opener for anyone in government or public education who is responsible for enforcing regulations on the government’s sale of private ad space, whether online, in newsletters and catalogs, or on senior buses, scoreboards, outfield fences and the like. Read the full opinion here, and let us know if we may be of assistance reviewing your entity’s advertising standards.

Ohio workers’ comp updates: voluntary abandonment of claims

We continue today our series of brief updates on Ohio workers’ compensation law aided by our Public Law team member and veteran workers’ compensation attorney Margaret O’Bryon. Margaret has tracked changes to the workers’ comp statute that went into effect on Sept. 15, 2020, with the passage of Ohio H.B. 81. All employers covered by the workers’ compensation system are wise to take note.

Today we discuss an important change to workers’ compensation law under H.B. 81, which addresses voluntary abandonment. The doctrine of voluntary abandonment was a judicially-created defense to an injured worker’s request for temporary total compensation (TT) or permanent total disability (PTD). As an affirmative defense, voluntary abandonment must be raised by the employer. If it is determined by the Industrial Commission that voluntary abandonment has occurred, the claimant will not receive TT or PTD. This is a cost savings for the employer.

Ohio case law previously held that voluntary abandonment occurred in the following situations:

When claimants quit their former position of employment for reasons unrelated to their injury.
When claimants violate a work rule that clearly defines the prohibited conduct, is identified by the employer as a dischargeable offense, and is known or should have been known by the claimants.
When claimants voluntarily retire from employment.
When claimants are incarcerated.

Ohio case law also previously held that voluntary abandonment did not occur in the following situations:

When it is based on pre-injury conduct.
When the claimants’ disability is caused by long-latency occupational diseases such as asbestosis, mesothelioma and pneumoconiosis.
When the behavior that caused the injury results in a violation of the work rule.

The voluntary abandonment doctrine was substantially changed on Sept. 14, 2020 when H.B. 81 was signed into law. R.C. 4123.56(F) now provides that “[i]f an employee is unable to work or suffers a wage loss as a direct result of an impairment from an injury or occupational disease, the employee is entitled to receive compensation under this section, provided the employee is otherwise qualified. If an employee is not working or has suffered a wage loss as the direct result of reasons unrelated to the allowed injury or occupational disease, the employee is not eligible to receive compensation under this section. It is the intent of the general assembly to supersede any previous judicial decision that applied the doctrine of voluntary abandonment to a claim under this section.”

Under H.B. 81, the standard is now whether claimants are not working due to their injury or whether they are not working for any reason unrelated to their injury. If they are not working due to their injury, they are entitled to TT compensation. If they are not working for any reason unrelated to their injury, they are not entitled to TT compensation.

It is likely that claimants’ attorneys will argue that the General Assembly intended to eliminate the concept of voluntary abandonment. Employers’ attorneys, however, will more accurately assert that the intent of the General Assembly was to bring clarity to the conflicting case law and to eliminate judicially-created exceptions to the voluntary abandonment doctrine. Whether the case law on voluntary abandonment has been settled by the General Assembly remains to be seen.

This change in the law was effective on Sept. 15, 2020, and it applies to all claims pending on and arising after that date. Contact Margaret O’Bryon for assistance with these issues or any workers’ compensation matters.

If you have questions or need assistance on any of the matters we’ve covered above or with your legal needs in general, please feel free to contact any member of the McDonald Hopkins Public Law team.

Have a great week!

Teresa Metcalf Beasley
Chair, Public Law