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Law firm recognized for client service, innovation adopts new tech

HighQ announces partnership with Hogan Lovells

/EIN News/ — LONDON, Jan. 10, 2018 (GLOBE NEWSWIRE) — HighQ is pleased to announce that Hogan Lovells, one of the world’s largest and most well-regarded law firms, has adopted a new technology to enhance the delivery of its legal services to clients around the world. The firm is now doing business with clients using HighQ’s platform.

Hogan Lovells is recognized as a leader not only for its practice of law, but also for its embrace of technology and commitment to client service. Most recently, for example, the firm was named one of the Top 10 firms on BTI Consulting Group’s Client Service A-Team, as well as one of six finalists in The American Lawyer’s prestigious Litigation Department of the Year awards.

Technology is top of mind for the legal industry as the practice of law evolves. In fact, in its 2018 Client Advisory, Citi Private Bank and Hildebrandt Consulting concluded that technology will reshape the industry, and firms that invest in tech will be stronger for it.

“We are fortunate to call Hogan Lovells a client of HighQ, and we appreciate its leadership in the industry, which is evolving to provide more efficient and effective counsel to businesses worldwide,” said Paul Hunt, HighQ’s chief revenue officer. “Hogan Lovells is recognized as a leader for integrating new technologies in virtually every aspect of its business, and we are privileged to have been selected to specifically support its endeavors to utilize technology to improve the firm’s interaction, collaboration and project management with its clients.”

Recognized by Financial Times as one of the most innovative law firms in the United States, Hogan Lovells is committed to building strong client relationships that are founded on its collaborative approach to doing business.

“We are committed to leading our clients to realize the benefits of a smarter form of practice that brings together our lawyer and client teams in new ways so that they may work more efficiently to achieve businesses’ goals and objectives,” Hogan Lovells said. “HighQ allows us to achieve that level of seamless collaboration.”

About Hogan Lovells

With 2,800 lawyers in around 50 offices on six continents, Hogan Lovells offers extensive experience and insights gained from working in some of the world’s most complex legal environments and markets for corporations, financial institutions and governments. The firm provides practical legal solutions that help clients identify and mitigate risk and make the most of opportunities. Whether a client is expanding into new markets, considering capital from new sources, or dealing with increasingly complex regulation or disputes, Hogan Lovells can help. Learn more at www.hoganlovells.com.

About HighQ

HighQ provides innovative enterprise collaboration and content publishing solutions to the world’s leading law firms, corporate legal teams and banks. Our secure file sharing, client extranet, matter collaboration and content marketing solutions uniquely combine enterprise-grade technology with the best ideas and user experience from consumer tools.

Beau Wysong
                    HighQ
                    913.998.6216
                    beau.wysong@highq.com
                    

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U.S. Grain Companies Concerned Over New Tax Law Impact

CHICAGO (Reuters) – The new U.S. tax law is poised to drive more control over the nation’s grain supply to farmer-owned cooperatives, provoking concern among ethanol producers and privately run grain handlers that they could be squeezed out of the competition to buy crops.

Until now, the cooperatives, private companies and publicly traded firms had a more even opportunity to handle the grain supply used in everything from loaves of bread in supermarkets to livestock feed.

The changes mean massive grain traders such as Archer Daniels Midland Co, Bunge Ltd and Cargill Inc [CARG.UL] could find it difficult to source corn, soybeans and wheat.

The perceived threat to these companies stems from a provision included in the final stages of the law’s passage in December. It gives farmers such a big tax deduction for selling their produce to agricultural cooperatives that private firms fear their grains supply will dry up.

The provision was championed by Republican farm state senators including John Thune of South Dakota and John Hoeven of North Dakota.

Privately held Cargill said on Tuesday it was surprised the provision was added to the bill at the last minute and is evaluating its potential impact.

Rival ADM, which also produces ethanol, said it too was evaluating the provision and “various potential solutions” to it.

The new tax law allows farmers and ranchers to claim a 20 percent deduction on all payments received on sales to cooperatives.

“It is going to put us out of business as a private if something is not changed right off the bat,” said Doug Bell, president and general manager of Bell Enterprises Inc, which operates grain elevators in central Illinois.

“There is just no reason whatsoever why a farmer would do business with anyone other than a co-op.”

The deductions could come as a massive boon to cash-strapped U.S. grain farmers, who have struggled for at least four years amid a global grain glut and sluggish commodity prices.

Some farmers seeking to take advantage of the new deduction are already asking about transferring grain they have stored at private elevators and selling it to cooperatives, Bell said. An association that represents cooperatives also has received questions from people who want to open new cooperatives.

The change focuses on a provision in the federal tax code that cuts taxes on proceeds from agricultural products – whether corn and soybeans, or milk and fresh fruit – that farmers and ranchers sell to farm cooperatives such as CHS Inc.

There is no comparable provision for farmers doing the same business with private or investor-owned companies.

“The advantage for the farmer is probably at least five times larger selling to a co-op versus not selling to a co-op,” said Paul Neiffer, an accountant at CliftonLarsonAllen in Yakima, Washington.

Neiffer said he has received hundreds of calls and emails from private elevators upset about the law.

Chuck Conner, president and chief executive of the National Council of Farmer Cooperatives, said his organization had begun to receive calls from people asking questions about starting a co-op to take advantage of the deduction.

“The producer/member deduction is more generous than most of us thought possible a few months ago,” he said in an email to members.

The number of U.S. farm cooperatives has been steadily shrinking in recent years, as they scramble to consolidate and stay competitive amid the merger frenzy of major seed and chemical companies.

There were 1,953 farmer, rancher and fishery co-ops in 2016 in the United States, down 4.6 percent from a year earlier, according to the most recent U.S. Department of Agriculture data. They handled $44.3 billion in net sales of grains in 2016, down 33 percent from a $66.3 billion peak in 2013.

CHS, the largest U.S. agricultural cooperative, said the new law ensures that “that cooperatives continue to be a driver of economic growth in rural America.”

Additional reporting by P.J. Huffstutter in Chicago; Editing by Simon Webb and Matthew Lewis

Our Standards:The Thomson Reuters Trust Principles.

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New tax law means fighting over unfunded state pension plans is about to get worse

The recently enacted U.S. tax law restricts federal deductions for state and local taxes (SALT) to $10,000 — including local property and sales taxes as well as local income taxes. While this new restriction will have many implications, it will have a particularly draconian impact on states with large unfunded liabilities for pension benefits and retiree health care, in particular the residents of Illinois, Kentucky, Connecticut, and New Jersey.

Unless states can implement effective ways to circumvent the SALT restriction, they will face much higher political barriers to meeting their unfunded benefit obligations through increased tax revenues. Instead, states will be forced to severely cut spending on public services and/or adopt major reforms of their benefit plans.

A state has payment obligations from three main sources — interest on its outstanding bonds, unfunded liabilities for pension benefits, and unfunded liabilities for health care payments to state retirees (before Medicare at age 65). The interest on outstanding state bonds is relatively easy to estimate; the total outstanding amount of all state bonds was $500 billion in 2016.  With the advent of improved accounting rules, it is now possible to compute the unfunded pension and retiree health care liabilities of each state.

The table below summarizes the situation for each of four states with the highest unfunded liabilities relative to their revenues in 2016 — Illinois, New Jersey, Connecticut and Kentucky.  The data in the table come from the Investment Strategy Team at JP Morgan Asset Management.  


The table shows the “current obligations ratio” for each state — the percentage of its revenues currently devoted to paying down its unfunded pension and retiree health care obligations plus interest on its state bonds. The table then compares that ratio to each state’s “full accrual obligations ratio.”  This latter ratio was calculated based on two reasonable assumptions — first, that state should pay down their unfunded pension and retiree health care liabilities over 30 years, and, second, that annual investment returns of states would average 6% over this period.

As the table shows, the gap between the two ratios could be filled by increases in state tax revenues. To cover the gap, however, states would have to raise local taxes by an eye-watering amount — ranging from 14% in Connecticut to 26% in New Jersey.  

These large increases in state revenues are not feasible, as illustrated by Illinois. To cope with its mammoth unfunded benefit obligations, Illinois has sharply raised tax rates on both individuals and businesses over the past few years. But higher tax rates in Illinois have backfired — driving local residents and firms to other states. In 2015, for example, Illinois lost $4.75 billion in adjusted gross income to other states, according to IRS data.

The new federal restrictions on SALT deductions ring the death knell for this strategy of raising state taxes to meet unfunded benefit obligations. For instance, middle-class residents of these four states are already paying effective tax rates of 9% to 12% — from local income, property and sales taxes. Since Congress has now limited SALT deductions to $10,000, residents of high-tax states are likely to push hard on their elected officials to lower local income and property taxes.  

States could also deal with unfunded benefit obligations by making substantial cuts in non-retirement spending — between 13% and 24% of state revenues according to the table. But local voters will vociferously object to substantial cuts in public services in areas such as education, transportation, and police protection.

That leaves one more avenue for states to pursue — enacting benefit reforms. According to the table, if the funding gap were closed entirely by increases in worker contributions, that increase would have to be monumental — by at least 400% in each of the four states. Such an increase would not be acceptable to public unions, and further would not be legally permissible in many states because of constitutional protections for accrued pension benefits.

Yet there is a light at the end of this tunnel.  The U.S. Supreme Court has opined that health care benefits of retirees may be legally modified at the expiration of the collective bargaining agreement – unless expressly guaranteed for life.  So the scope of health care benefits and premium sharing by public retirees will become a subject of political negotiation between elected officials and public unions.

Reform of public pensions will be much more difficult. Although states may establish a different retirement system for their newly hired employees, this will take years to have much of a financial impact. Already accrued benefits are sacrosanct in most states — with the notable exception of reduced adjustments for costs of living, which have been allowed by many courts.  

The big question: Will courts allow modifications of pension benefits with respect to future years of work by public employees? Historically, California has led the way in blocking such forward-looking pension changes. However, two California courts have recently allowed such changes as long as public employees still receive a “substantial” and “reasonable” pension.  

In short, the new federal restriction on SALT deductions will open up a new window on reforming state benefit plans with large unfunded liabilities. As voters absorb the financial implications of the new restriction, they will probably oppose tax increases and service cuts to deal with these liabilities. Instead, they will pressure elected officials to renegotiate benefit plans to the extent legally permissible.  

Robert C. Pozen is a senior lecturer at MIT Sloan School of Management and a non-resident senior fellow of the Brookings Institution. 

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‘America First?’ Not necessarily when it comes to GOP tax law and booze

WASHINGTON — The new Republican tax law counts on a small, little-known federal agency to ensure a tax provision aimed at helping small liquor producers does not become a loophole large foreign distillers can exploit.

At issue is the law’s tax cut for hard liquor producers, dropping a tax from $13.50 per proof gallon (a measure of the liquor’s quantity and alcohol content) to $2.70 per proof gallon. That bargain $2.70 rate is limited to the first 100,000 proof gallons, while companies pay a higher rate on booze produced beyond that.

The cap is aimed primarily at benefiting small distilleries, aiming to spark small-business expansion and hiring. But the lower tax rate is also available to importers buying from foreign producers, and some fear that has opened up a loophole that foreign firms could use to pay the lower rate on more liquor than the plan’s drafters intended.

The scramble to enforce these new alcohol taxes is one example of the federal bureaucracy’s daunting new task of implementing a Republican tax law that critics say was passed quickly through Congress and contains a host of provisions that took effect within days of the law’s passage. Much of the enforcement will fall to the Internal Revenue Service, which experts fear has been left unable to handle the burden due to steep budget cuts. But other agencies have been tasked with enforcement too, and their ability to shoulder that burden is up for debate.

Enforcing the new liquor tax regime falls predominantly to the U.S. Alcohol and Tobacco and Trade Bureau, a Treasury Department agency that even before the tax law was racing to keep up with a boom in new domestic distilleries and breweries. The agency, which employs about 500 people across the country, had an annual budget of $113 million in 2016.

Some fear the fast adjustment to the new tax regime will stretch the agency’s ability to effectively monitor the industry, although others insist that the agency is well-prepared to meet the challenge.

In its changes to liquor taxes, the GOP tax law drew heavily from an earlier, bipartisan proposal to revamp the federal tax system for booze. But while that previous version would have delayed the tax changes for about one year after passage to allow the agency time to craft an enforcement strategy, the law that passed gave the bureau about two weeks to do so.

TTB says that it is currently working on deciding how to implement the law, which could include issuing regulations. Typically, the bureau holds a months-long process to take public feedback and craft new regulations or guidelines for translating federal law into reality.

“We’re assessing [the new law] right now and will move on it as quickly as we can,” said Tom Hogue, a spokesman for the Alcohol and Tobacco and Trade Bureau. “It’s a pretty short run-up time, but we’re doing the best we can with the new statute. We’re hoping to issue guidance as soon as we can.”

But in the law as written, some see a loophole foreign firms could exploit.

If one foreign company were to act as if it were multiple companies selling different products to U.S. importers, its products might be eligible for the $2.70 tax rate on all sales, including those beyond the first 100,000 proof gallons, said Adam Looney, a former Treasury Department official now at the Brookings Institution.

Theoretically, U.S. companies could try the same scheme. But it would be easier to get away with abroad, where the TTB has less access and limited resources.

Foreign producers “will represent themselves as ‘craft’ producers even if they’re not,” Looney writes in a recent blog post. “Almost a third of distilled spirits is imported and the importers would have a strong incentive to claim the lowest rate. [The United States] will have little ability to stop them.”

Experts disagreed about the scale of the problem, with several in the industry dismissing the concern as baseless. Some noted that the agency would likely be able to enforce the law by overseeing importers, based in America, who they could hold accountable for the actions of their foreign producers.

“TTB has no extraterritorial reach, and they can’t go to France or German or South African to enforce this law. But they have an existing base of accountable importers, and the fallback is to say that they’re going to be held accountable,” said Bill Earle, president of the National Association of Beverage Importers. “It’s an issue that could be prickly, but it’s not something that’s irresolvable.”

“I don’t see where there will be an enforcement issue,” said Chuck Schumacher, a consultant for private companies who served as an investigator at TTB. “Fraud is rare and, for the most part, industry complies.”

Others former government officials said that it was hard to imagine how many foreign producers, if any, would be both big enough to have to evade U.S. law to claim the lower credit and willing to take the risk to do so. “Anyone who is doing 100,000-proof gallon has too much at stake to cheat,” said Dunbar, who predicted the TTB could craft the necessary regulations to ensure producers follow the new law.

Added Earle: “The United States has the benefit of being a market that has overwhelmingly reputable distilled spirits producers coming here, and that’s because it’s an expensive market to get into.”

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U.S. grain companies fear harm from new tax law

CHICAGO (Reuters) – The new U.S. tax law is poised to drive more control over the nation’s grain supply to farmer-owned cooperatives, provoking concern among ethanol producers and privately run grain handlers that they could be squeezed out of the competition to buy crops.

Until now, the cooperatives, private companies and publicly traded firms had a more even opportunity to handle the grain supply used in everything from loaves of bread in supermarkets to livestock feed.

The changes mean massive grain traders such as Archer Daniels Midland Co, Bunge Ltd and Cargill Inc [CARG.UL] could find it difficult to source corn, soybeans and wheat.

The perceived threat to these companies stems from a provision included in the final stages of the law’s passage in December. It gives farmers such a big tax deduction for selling their produce to agricultural cooperatives that private firms fear their grains supply will dry up.

The provision was championed by Republican farm state senators including John Thune of South Dakota and John Hoeven of North Dakota.

Privately held Cargill said on Tuesday it was surprised the provision was added to the bill at the last minute and is evaluating its potential impact.

Rival ADM, which also produces ethanol, said it too was evaluating the provision and “various potential solutions” to it.

The new tax law allows farmers and ranchers to claim a 20 percent deduction on all payments received on sales to cooperatives.

“It is going to put us out of business as a private if something is not changed right off the bat,” said Doug Bell, president and general manager of Bell Enterprises Inc, which operates grain elevators in central Illinois.

“There is just no reason whatsoever why a farmer would do business with anyone other than a co-op.”

The deductions could come as a massive boon to cash-strapped U.S. grain farmers, who have struggled for at least four years amid a global grain glut and sluggish commodity prices.

Some farmers seeking to take advantage of the new deduction are already asking about transferring grain they have stored at private elevators and selling it to cooperatives, Bell said. An association that represents cooperatives also has received questions from people who want to open new cooperatives.

The change focuses on a provision in the federal tax code that cuts taxes on proceeds from agricultural products – whether corn and soybeans, or milk and fresh fruit – that farmers and ranchers sell to farm cooperatives such as CHS Inc.

There is no comparable provision for farmers doing the same business with private or investor-owned companies.

“The advantage for the farmer is probably at least five times larger selling to a co-op versus not selling to a co-op,” said Paul Neiffer, an accountant at CliftonLarsonAllen in Yakima, Washington.

Neiffer said he has received hundreds of calls and emails from private elevators upset about the law.

Chuck Conner, president and chief executive of the National Council of Farmer Cooperatives, said his organization had begun to receive calls from people asking questions about starting a co-op to take advantage of the deduction.

“The producer/member deduction is more generous than most of us thought possible a few months ago,” he said in an email to members.

The number of U.S. farm cooperatives has been steadily shrinking in recent years, as they scramble to consolidate and stay competitive amid the merger frenzy of major seed and chemical companies.

There were 1,953 farmer, rancher and fishery co-ops in 2016 in the United States, down 4.6 percent from a year earlier, according to the most recent U.S. Department of Agriculture data. They handled $44.3 billion in net sales of grains in 2016, down 33 percent from a $66.3 billion peak in 2013.

CHS, the largest U.S. agricultural cooperative, said the new law ensures that “that cooperatives continue to be a driver of economic growth in rural America.”

Additional reporting by P.J. Huffstutter in Chicago; Editing by Simon Webb and Matthew Lewis

Our Standards:The Thomson Reuters Trust Principles.

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US grain companies fear harm from new tax law

CHICAGO: The new U.S. tax law is poised to drive more control over the nation’s grain supply to farmer-owned cooperatives, provoking concern among ethanol producers and privately run grain handlers that they could be squeezed out of the competition to buy crops.

Until now, the cooperatives, private companies and publicly traded firms had a more even opportunity to handle the grain supply used in everything from loaves of bread in supermarkets to livestock feed.

The changes mean massive grain traders such as Archer Daniels Midland Co, Bunge Ltd and Cargill Inc could find it difficult to source corn, soybeans and wheat.

The perceived threat to these companies stems from a provision included in the final stages of the law’s passage in December. It gives farmers such a big tax deduction for selling their produce to agricultural cooperatives that private firms fear their grains supply will dry up.

The provision was championed by Republican farm state senators including John Thune of South Dakota and John Hoeven of North Dakota.

Privately held Cargill said on Tuesday it was surprised the provision was added to the bill at the last minute and is evaluating its potential impact.

Rival ADM, which also produces ethanol, said it too was evaluating the provision and “various potential solutions” to it.

The new tax law allows farmers and ranchers to claim a 20 percent deduction on all payments received on sales to cooperatives.

“It is going to put us out of business as a private if something is not changed right off the bat,” said Doug Bell, president and general manager of Bell Enterprises Inc, which operates grain elevators in central Illinois.

“There is just no reason whatsoever why a farmer would do business with anyone other than a co-op.”

The deductions could come as a massive boon to cash-strapped U.S. grain farmers, who have struggled for at least four years amid a global grain glut and sluggish commodity prices.

Some farmers seeking to take advantage of the new deduction are already asking about transferring grain they have stored at private elevators and selling it to cooperatives, Bell said. An association that represents cooperatives also has received questions from people who want to open new cooperatives.

The change focuses on a provision in the federal tax code that cuts taxes on proceeds from agricultural products – whether corn and soybeans, or milk and fresh fruit – that farmers and ranchers sell to farm cooperatives such as CHS Inc.

There is no comparable provision for farmers doing the same business with private or investor-owned companies.

“The advantage for the farmer is probably at least five times larger selling to a co-op versus not selling to a co-op,” said Paul Neiffer, an accountant at CliftonLarsonAllen in Yakima, Washington.

Neiffer said he has received hundreds of calls and emails from private elevators upset about the law.

Chuck Conner, president and chief executive of the National Council of Farmer Cooperatives, said his organization had begun to receive calls from people asking questions about starting a co-op to take advantage of the deduction.

“The producer/member deduction is more generous than most of us thought possible a few months ago,” he said in an email to members.

The number of U.S. farm cooperatives has been steadily shrinking in recent years, as they scramble to consolidate and stay competitive amid the merger frenzy of major seed and chemical companies.

There were 1,953 farmer, rancher and fishery co-ops in 2016 in the United States, down 4.6 percent from a year earlier, according to the most recent U.S. Department of Agriculture data. They handled US$44.3 billion in net sales of grains in 2016, down 33 percent from a US$66.3 billion peak in 2013.

CHS, the largest U.S. agricultural cooperative, said the new law ensures that “that cooperatives continue to be a driver of economic growth in rural America.”

(Additional reporting by P.J. Huffstutter in Chicago; Editing by Simon Webb and Matthew Lewis)

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Reform `retentions´ to help building firms hit top gear…

Press Association

Construction firms are being held back by the “restrictive and grossly unfair” practice of retentions at a time when the industry needs to be operating in top gear ahead of Brexit, a Tory MP has said.

Peter Aldous also said it was a critical time for the industry given the need to build a record number of homes.

But the backbencher said the practice of firms failing to pay back retentions to smaller suppliers was stifling the sector.

Waveney MP Mr Aldous told the Commons that retentions of as much as 10% of a contract value were often withheld, in case the firm did not return to fix any defects.

However, Mr Aldous said the payments were often withheld to improve a firm’s financial position, and can take months or even years to be returned.

MPs heard that almost £8 billion of retentions have remained unpaid over the last three years, according to Government estimates.

Over the past three years some firms have lost an average of £79,900 due to other companies going bust, Mr Aldous said.

“If one of the large construction companies were to fail, the consequences for SMEs and their supply chains would potentially be disastrous,” he added.

“They could lose all their retentions, adding to the £220 million already being lost annually. This Bill would help avert such a calamity.

“This is a critical time for the construction industry. We need to be building record numbers of homes.

“As Brexit approaches, the construction industry must be able to operate in top gear.

“This restrictive and grossly unfair practice acts as a brake on activity in the sector. Remove it, and we can unleash investment in jobs, apprenticeships and technical innovation.”

Tory MP Peter Aldous (Conservative Party/PA)

Tory MP Peter Aldous (Conservative Party/PA)

Tory MP Peter Aldous (Conservative Party/PA)

His Construction (Retention Deposit Schemes) Bill, brought in via a 10-minute rule motion, would create legislation to ensure the money can be returned, establishing a similar scheme to that now in place for private renters, where deposits must be held in a Government-approved scheme.

Mr Aldous went on: “Abuse of retention has a negative, knock-on, domino effect that cascades through the construction industry.

“It restricts investment in new equipment and facilities.

“It prevents firms from taking on more work, and it discourages them from employing more people and investing in apprenticeships.”

The Bill was listed for a second reading on April 27, but it has many hurdles to clear as it bids to become law.

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Reform ‘retentions’ to help building firms hit top gear ahead of Brexit, MP says

Construction firms are being held back by the “restrictive and grossly unfair” practice of retentions at a time when the industry needs to be operating in top gear ahead of Brexit, a Tory MP has said.

Peter Aldous also said it was a critical time for the industry given the need to build a record number of homes.

But the backbencher said the practice of firms failing to pay back retentions to smaller suppliers was stifling the sector.

Waveney MP Mr Aldous told the Commons that retentions of as much as 10% of a contract value were often withheld, in case the firm did not return to fix any defects.

However, Mr Aldous said the payments were often withheld to improve a firm’s financial position, and can take months or even years to be returned.

MPs heard that almost £8 billion of retentions have remained unpaid over the last three years, according to Government estimates.

Over the past three years some firms have lost an average of £79,900 due to other companies going bust, Mr Aldous said.

“If one of the large construction companies were to fail, the consequences for SMEs and their supply chains would potentially be disastrous,” he added.

“They could lose all their retentions, adding to the £220 million already being lost annually. This Bill would help avert such a calamity.

“This is a critical time for the construction industry. We need to be building record numbers of homes.

“As Brexit approaches, the construction industry must be able to operate in top gear.

“This restrictive and grossly unfair practice acts as a brake on activity in the sector. Remove it, and we can unleash investment in jobs, apprenticeships and technical innovation.”

His Construction (Retention Deposit Schemes) Bill, brought in via a 10-minute rule motion, would create legislation to ensure the money can be returned, establishing a similar scheme to that now in place for private renters, where deposits must be held in a Government-approved scheme.

Mr Aldous went on: “Abuse of retention has a negative, knock-on, domino effect that cascades through the construction industry.

“It restricts investment in new equipment and facilities.

“It prevents firms from taking on more work, and it discourages them from employing more people and investing in apprenticeships.”

The Bill was listed for a second reading on April 27, but it has many hurdles to clear as it bids to become law.

Copyright (c) Press Association Ltd. 2017, All Rights Reserved.

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John Grisham’s ‘The Rooster Bar’ inspired by CU Boulder law professor’s article

University of Colorado Law Professor Paul Campos is pictured in 2012.

University of Colorado Law Professor Paul Campos is pictured in 2012. (Patrick Campbell / The Denver Post)

Bestselling author John Grisham’s latest legal thriller, “The Rooster Bar,” was inspired by University of Colorado Law Professor Paul Campos’s article on for-profit law schools, Grisham said.

In an interview with The Atlantic, Grisham admits Campos’s 2014 article, “The Law-School Scam,” also published in the The Atlantic, was the muse behind his 2017 law student-centered novel.

Grisham’s book details the experiences of three third-year law students, frustrated after taking out massive student loans at a for-profit law school failing at landing the students jobs.

“I didn’t know about it until actually a few days after the book came out,” Campos said.

A journalist from The Chronicle of Higher Education contacted Campos shortly after the end-of-2017 publication of Grisham’s book to see how the professor felt about the homage.

Campos was pleasantly surprised.

“It turned out, [Grisham] had sent me a copy of the book with a nice little letter, but the mail system at CU tends to be rather spotty, so I didn’t actually get it until a couple of days after I heard about it,” he said. “He certainly didn’t talk to me about it, but it was nice, needless to say, to have a story like that featured in a John Grisham novel, which is about 10,000 times more resonant than a standard academic setting.”


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Campos’s article was an investigation into the world of for-profit law schools. After being tipped off about the matter and doing some digging, Campos discovered handfuls of American Bar Association-accredited schools were admitting underqualified students taking out hundreds of millions of dollars each year in loans they would likely be unable to repay, to the benefit of the school — some owned by private equity firms.

Although Campos admits he is a bit biased, he said he understands why this situation would catch the eye of a novelist.

“I think there is something inherently compelling about the narrative of the combination of the legal and the academic world and their relation to hot-button issues having to do with exploitation of young people by the system, which is, obviously, a very germaine topic, in general, right now,” he said.

In Grisham’s interview, the novelist said one aspect of Campos’s article that most captured his attention was Grisham’s own ignorance to the topic.

“I think one of the most charming things about Grisham’s statements in regard to the whole issue is the extent to which he admitted he was just basically unaware that any of this was going on,” Campos said. “I think it was material rich for mining.”

When Campos’s article came out, he received a good deal of positive feedback along with “an army of trolls,” he said.

“I think it has been very resonating,” Campos said. “The Grisham thing is a capstone to all that. You never know who you’re going to reach.”

Since Campos’s 2014 article, he’s seen a good deal of progress made in the for-profit law school realm.

One of three law schools discussed in Campos’s piece has since gone out of business, with two others “teetering on the brink,” he said. Campos added that the American Bar Association began more strictly enforcing its accreditation standards, too.

“It’s been the beginning of a real reckoning that has moved through the system in the last two or three years in terms of legal education,” he said.

As far as Campos’s book review, he admits he has yet to read “The Rooster Bar.”

“But I’m looking forward to doing so,” he said.

Elizabeth Hernandez: 303-473-1106, hernandeze@dailycamera.com

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