Law Tips: Are There Unique Challenges for Gray Divorce Clients?

Americans over the age of 50 are getting divorced at a record rate – doubling since 1990. Sociologists have coined the term “Gray Divorces” to describe this phenomenon. In a Gray Divorce, each spouse often leaves the marriage with assets unlike members of any other age group getting divorced.

So goes the scenario presented by Jim Reed and Lisa Goddy, our Law Tips faculty participants. They draw attention in their estate planning CLE presentation to several important trending issues for this developing group. Perhaps you have clients who need to consider “The Unique Challenges of Gray Divorce:”

  • While “gray divorces” often eliminate some issues associated with younger divorces (e.g., child custody), gray divorces often create their own novel challenges.
  • One of the biggest challenges of gray divorce is that the parties usually have little or no remaining years of income earning potential. When a 30-something gets divorced, the financial repercussions of divorce are offset by the ability to “earn a way out” in future decades. In a gray divorce, the existing assets to be divided often constitute all that the parties will ever have, or nearly so.
  • It is usually good advice to tell a gray divorce client who is contemplating retirement to wait until the divorce is over and a better understanding of the post-divorce financial situation can be evaluated. The longer that the client can defer spending down savings, the better.
  • In addition, the couple may have spent decades coming up with a financial plan that allows them to retire and maintain a similar standard of living after their retirement. Such a plan is almost always deeply jeopardized- for both parties- by a gray divorce.
  • A gray divorce will typically involve a disproportionately high amount of retirement assets. It is imperative to understand the related tax consequences when evaluating any division of the marital estate so that the intrinsic “discount” associated with tax-deferred retirement accounts can be factored.
  • There may also be defined benefit retirement plans, which were more common decades ago and seen less frequently now in younger divorces. Further, since defined benefit pensions tend to reach their greatest present value in the years just before retirement, these assets can have substantial value and usually require professional, actuarial valuation.
  • Dividing the marital estate in a gray divorce often takes away the option of having one party make extended property settlement payments over time, due to questionable future income and the heightened risk of disability or mortality before the property payment stream is completed (a factor made even more complicated by the added difficulty of securing that obligation with life insurance.)
  • More so than with a younger couple, it is often disadvantageous to seek possession of a marital residence, since downsizing and reducing expenses is often a consideration.
  • In a gray divorce, the parties might have forgone long-term care insurance, assuming that the other spouse would be available to help provide that care. A gray divorce provides an opportunity to re-evaluate whether long-term care insurance is an option that should be reconsidered.
  • Healthcare issues can also be more complicated in a gray divorce. Because of age, a gray divorce spouse is more likely to have health issues. Further, a non-employed spouse who relied on the other spouse’s employer-provider insurance may be too young for Medicare eligibility. Here, it is important to ascertain COBRA and/or private insurance options and costs.

Even though remarriage is often the last thing on a gray divorce client’s mind, I always leave them with the parting wisdom to consider a premarital agreement in the event of remarriage. (Or a cohabitation agreement in the event of cohabitation.) Few clients are aware of elective share and other restrictions that remarriage can impose upon their desire to leave most or all of their estate to children from a previous marriage.

I appreciate Jim Reed and Lisa Goddy providing this timely review of the issues surrounding “Gray Divorces.” If you are interested in the one-hour CLE update in this area, register for our On Demand seminar entitled: Estate Planning for “Gray” Divorces. Jim Reed is also scheduled as a speaker for the 2015 Indiana Law Update. Be sure to block out time for ILU on September 9-10

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About our Law Tips faculty participants:

Lisa B. Goddy, Of Counsel, Bingham Greenebaum Doll LLP, Indianapolis. Lisa works in the firm’s Estate and Wealth Transfer Practice Group. She focuses her practice on estate planning, probate and trust administration, special needs trusts and wealth transfer planning.

James A. Reed, Partner, Bingham Greenebaum Doll LLP, Indianapolis. Jim Reed has concentrated his practice in the legal aspect of relationship transitions of all types since graduating from law school. He has been involved in divorce cases with some of the largest marital estates in Indiana. He represents many professionals (medical, legal, accounting, financial), business owners and executives, community leaders, high-profile individuals in entertainment, sports and politics, and the spouses/partners of these individuals.

About our Law Tips blogger:
Nancy Hurley has long-standing connections with Indiana lawyers. She was formerly a member of the ISBA and IBF staffs for over 30 years. Nancy’s latest lifestyle venture is with ICLEF. We are utilizing her exceptional writing and interviewing skills while exploring how her Indiana-lawyer background fits with ICLEF’s needs. When she isn’t ferreting out new topics for Law Tips, her work can be found in our Speaker Spotlight blogs, postings on the ICLEF Facebook and Twitter pages, and other places her legal experience lends itself.

Thank you for reading Law Tips. You may subscribe to this weekly blog through the RSS link at the top of this page.  Also, you are encouraged to comment below or email Nancy. She welcomes your input as she continues to sift through the treasure trove of knowledge of our CLE faculty to share with you.

ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN

Posted in Law Tips, News0 Comments

ALC Donut Chart-2

Amateur Life Coach: Should I eat this doughnut?

James J. Bell, ICLEF's Amateur Life Coach

 

 

 

 

 

Dear ALC:

Should I eat this donut?

Sincerely,
Befuddled in Bedford

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Dear Befuddled:

There are topics that are easy for the Lifecoach to explain (like electromagnetic field theory, thermodynamics and One Direction.) But you’ve raised an issue requiring more than mere words. The flow chart below contains the answers to all the issues, sub-issues, controversies and sub-plots that your problem present.

ALC Donut Chart-2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

I’m the Amateur Lifecoach and I hope this helps.

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James focuses his practice in the areas of criminal defense; attorneys discipline defense and health care law. As a Marion County Public Defender, he represented clients in numerous jury and bench trials. James also represents clients in juvenile delinquency, appeals and post-conviction proceedings. James is a frequent ICLEF speaker on ethics, trial practice and criminal procedure. As of January 2013, he began serving as an adjunct professor at the Indiana University Robert H. McKinney School of Law where he teaches a course on professional responsibility. To date, no student has yet stood on their desk and shouted “Oh captain, my captain!”

Follow James on Twitter @jamesjbell or the Amateur Lifecoach at

Questions for the amateur life coach? Email them to scottking@iclef.org

ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN

Posted in Amateur Life Coach0 Comments

I.P. Blog: Indiana Trade Secret Law: Think Tank’s Info Was Not a Trade Secret as a Matter of Law

By: Paul B. Overhauser Publisher: Indiana Intellectual Property Law News

Indianapolis, Indiana – The Court of Appeals of Indiana affirmed the directed verdict of Special Judge William E. Alexa of Porter Superior Court. Writing for the Indiana appellate court, Judge John Baker concluded that the trial court had not erred in ruling that Defendants’ information was insufficiently private to constitute trade secrets.

Appellant-Plaintiff Think Tank Software Development Corporation, d/b/a Think Tank Networking Technologies Group and Think Tank Information Systems (“Think Tank”) is engaged in computer-related business activities, including systems and network engineering, problem solving, systems design, implementation, sales, client training, and computer maintenance. During 2001 and 2002, multiple employees left Think Tank and joined its competitor, Chester, Inc.

In 2002, Think Tank sued Chester as well as former Think Tank employees Mike Heinhold, John Mario, Joel Parker, Thomas Guelinas, Jon Meyer, Daniel Curry, Eric M. Wojciechoswki, Michael Gee, Philip Ryan Turner and Carl Zuhl alleging:

1) breach of the covenant not to compete,
2) breach of the confidentiality clause,
3) breach of the agreement not to solicit its employees for other work,
4) tortious interference with contracts,
5) misappropriation of trade secrets,
6) tortious interference with business relationships,
7) unjust enrichment, and
8) defamation. Think Tank also included a claim for unfair competition against Chester.

After much litigation, including two prior appeals to the Indiana Court of Appeals, this Indiana trade secret lawsuit was again heard by the trial court on the remaining claims: misappropriation of trade secrets, tortious interference with contracts, and breach of the covenant not to compete and confidentiality provisions.

The most interesting of the claims in this lawsuit is Think Tank’s assertion of misappropriation of trade secrets. Defendants moved for a directed verdict on that count, as well as all other claims against them. The trial court granted the directed verdict on Think Tank’s claim for misappropriation of trade secrets, reasoning that, “[it] is a question of law for the Court relative to what is and what is not a trade secret. Plaintiff has failed to show that the information obtained was ever, in law, a trade secret.”

Shortly after this ruling, Think Tank sought review a third time from the Indiana Court of Appeals. It claimed that its trade secrets included:

1) the nature and design of its technical solutions;
2) the design of its customers’ computer systems;
3) pricing; and
4) customer identities. Think Tank further argued that the trial court could not determine as a matter of law whether information was a trade secret under Indiana Code section 24-2-3-2, which defines a trade secret as: information, including a formula, pattern, compilation, program, device, method, technique, or process, that:
(1) derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and
(2) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

The Indiana appellate court declined to address Think Tank’s argument whether a trial court could determine as a matter of law whether information was a trade secret under Indiana law. However, it concluded that Think Tank had failed in its burden to avoid the directed verdict: “as a matter of law, Think Tank failed to produce enough evidence to allow a reasonable fact finder to determine that the proffered information was trade secrets.” Specifically, it found that Think Tank failed to show that any of the information alleged to be trade secrets was not generally known to or ascertainable by the public.

The appellate court agreed with the Indiana trial court that:
1) the computer certifications and intellectual capital that Think Tank possessed was readily available information;
2) knowledge of customers’ computer systems and current or future needs was readily ascertainable, as such information belonged to the customers in question; and
3) pricing information did not constitute a trade secret, as it too was readily available from the customers. Thus, the information was not a trade secret.

The Indiana appellate court continued that Think Tank appeared not to be trying to protect its trade secrets, but instead to prevent competition. Such a goal, the court said, might be effectuated by a non-competition agreement. However, the use of Indiana legislation designed to protect trade secrets could not properly be stretched to hinder the use of information that appeared to be generally known or readily obtained from another source.

This Indiana trade secret litigation was assigned Case No. 64A03-1404-PL-134. The opinion was written by Judge Baker of the Indiana Court of Appeals. Chief Judge Vaidik and Judge May concurred.

The Opinion

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By: Paul B. Overhauser, Publisher, Indiana Intellectual Property Law News

Overhauser Law Offices, LLC provides intellectual property services including patents, trademarks, copyrights and infringement litigation. Whether you’re an entrepreneur launching your first invention or a corporation looking for a litigation specialist, we have the legal experience to meet your goals.

To learn more about how Overhauser Law Offices can help you, browse our website to meet our lawyers and peruse our practice areas.  Then contact us, and we’ll put our expert team to work for you.

© 2015

ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN

Posted in Intellectual Property Blog0 Comments

Negotiation Blog: Don’t Negotiate in These Situations!

Notes on Negotiations
By Marty Latz, Latz Negotiation Institute

I have been accused by my wife on occasion of negotiating too much – and she is right. Even though I enjoy the process immensely, sometimes I spend too much time and effort trying to get the absolute best deal when I might be better off just walking away or graciously accepting.

I was thus particularly interested in a recent Harvard Negotiation newsletter piece describing four situations when you should not negotiate (which originally appeared in the book Negotiation Genius, by Deepak Malhotra and Max Bazerman). Here they are, along with my thoughts on each.

1. Not worth your time.
Anyone who has ever hired a lawyer or paid someone an hourly rate understands that time is money.

In the negotiation world, time is also money and has a unique value to each individual. Everyone has a limited amount of time in life, so use it wisely. Ask yourself at the beginning of possible negotiations: is your preferred outcome (your goal) worth the likely time involved? If so, go for it. If not, don’t.

2. When your leverage is super weak.
The day after I graduated college I was driving from Wisconsin to Washington, DC when my car broke down in the middle of Ohio. After getting towed to the one car repair facility in the closest town, I was told I needed to replace my engine.

I was in a really tough spot. I was on crutches from knee surgery, had a job interview the next day in DC, and there was one cab in town that could get me to the airport 90 minutes away for the last flight that day to DC. And time was running out to make that flight.

Bottom line – my leverage was super weak as I really needed to get to DC that day, I had no good alternative to having them fix my car, and they knew I was desperate (they knew the cabbie).

So when I got an estimate to fix my car – while I asked for a discount by appealing to his sense of fairness as I figured it didn’t cost me anything to ask – I basically just accepted his offer.

Sometimes it’s better to just recognize your weak leverage and appeal to your counterpart’s sense of fairness.

3. When negotiating sends the wrong signal.
We’ve all heard the phrase “don’t look a gift horse in the mouth.” Sometimes the downside risk of negotiating is significant, the upside benefit of just accepting their offer is big, and it’s just not worth it to engage.

Perhaps your new boss asked you to finish a particularly interesting and important project over the weekend. Don’t ask for something extra because it’s the weekend, making you appear ungrateful.

Or perhaps your friend offered you some sports tickets at his cost, just hours before the game. You could probably get him to knock off some dollars off as he’s likely desperate, but doing so would appear cheap.

4. When negotiating is culturally inappropriate.
Do you know anyone who negotiates the price of food at large grocery stores? Probably not. It’s culturally inappropriate here.

When dealing with those from other cultures, find out whether and under what circumstances it is appropriate to negotiate. Sometimes their negotiation norms will be similar to ours. Other times you may put yourself in awkward and embarrassing situations.

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Marty Latz is the founder of Latz Negotiation Institute, a national negotiation training and consulting company, and ExpertNegotiator, a Web-based software company that helps managers and negotiators more effectively negotiate and implement best practices based on the experts’ proven research.  He is also the author of Gain the Edge! Negotiating to Get What You Want (St. Martin’s Press 2004). He can be reached at 480-951-3222 or Latz@ExpertNegotiator.com

ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN

Posted in Negotiation/Mediation Blog0 Comments

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