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Five Stories That Matter in Michigan This Week – January 24, 2025

Michigan House Passes Bills on Minimum Wage, Paid Sick Leave

This week, the Michigan House of Representatives passed HB 4001 and 4002, which address the coming changes to the minimum wage law and the Earned Sick Time Act (ESTA), respectively, and which are set to go into effect on February 21, 2025. Now the bills are sent to the Senate for consideration.

Why it Matters: This comes in response to a significant Michigan Supreme Court from last summer that reimplemented a citizen initiated law mandating raising minimum wage to $15 by 2028, phasing out the tipped minimum wage system, and requiring paid sick time for nearly every Michigan worker.

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Corporate Transparency Act Update – U.S. Supreme Court Lifts Nationwide Injunction –

On January 23, 2025, the United States Supreme Court granted the government’s request to lift one of the nationwide injunction that had been preventing enforcement of the Corporate Transparency Act (“CTA”). However, due to another similar injunction that was not addressed by the Court, FinCEN has provided the following guidance.

Why it Matters: As a separate nationwide order issued by a different federal judge in Texas (Smith v. U.S. Department of the Treasury) still remains in place, reporting companies are not currently required to file beneficial ownership information with FinCEN despite the Supreme Court’s action in Texas Top Cop Shop. Reporting companies also are not subject to liability if they fail to file this information while the Smith order remains in force. However, reporting companies may continue to voluntarily submit beneficial ownership information reports. Read more.

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Federal Court Strikes Down 2024 Title IX LGBTQ+ Protections

A federal judge in Kentucky recently invalidated the Biden administration’s 2024 Title IX regulations that would have expanded protections for LGBTQ+ students nationwide. The ruling found that the U.S. Department of Education exceeded its authority in attempting to broaden Title IX’s scope to include gender identity discrimination.

Why it Matters: While this ruling reverts federal standards back to 2020, Michigan schools must still comply with the state’s Elliott-Larsen Civil Rights Act, which protects students from discrimination based on gender identity, sexual orientation, and gender expression.

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Michigan Cannabis Exceeds $265 Million in December ‘24

Cannabis sales surpassed $265 million in December, via the monthly report from the Michigan Cannabis Regulatory Agency. Michigan adult-use sales came in at $264,689,198.93, while medical sales came in at $815,759.74, totaling $265,504,958.67.

Why it Matters: While the prices of cannabis and cannabis-related products continue to decrease and make consumers happy, growers on the other hand are seeing profits decrease resulting in them seeking ways to halt new licenses to be granted in an effort to steady prices.

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Business Education Series: Your Comprehensive Guide to Driving Employee Engagement

The workforce is facing challenges like talent shortages and quiet quitting, making it crucial to attract, engage, and retain employees. With 75% of turnover preventable, employers who create engaging environments focused on essential needs can better retain and attract talent.

Why it Matters: During the January Business Education Series, facilitated by Cheryl Kuch, Senior Consultant, Rehmann, discover what top organizations do to foster engagement and gain best practices to protect your most valuable asset—your people. Hosted at the Lansing Regional Chamber of Commerce. More information.

Related Practice Groups and Professionals

Labor, Employment & Civil Rights | David Houston
Business & Tax | Robert D. Burgee
Cannabis Law | Sean Gallagher

Five Stories That Matter in Michigan This Week – April 21, 2023

Michigan Repeals “Right-to-Work” Law

Governor Gretchen Whitmer signed into law legislation repealing the Freedom to Work law insofar as it applies to private-sector employees. The repealer will be effective as of March 30, 2024.

Why it Matters: When the new law takes effect, it will, for the first time since 2013, be legal for private-sector unions to negotiate and enforce “union security” requiring membership in, or financial support through “Beck Objector” fees, of those unions. Learn more from your Fraser Trebilcock attorney.

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Biden Administration Proposes Title IX Rule Change Prohibiting Schools from Categorically Banning Transgender Athletes from School Sports

The Biden administration proposed a significant change to Title IX regulations via a notice of proposed rulemaking, seeking to prohibit schools from categorically banning transgender athletes from participating in sports consistent with their gender identities. However, the proposal also provides flexibility for K-12 schools and universities to limit transgender student participation in cases where fairness in competition or sports-related injuries might be concerns.

Why it Matters: It’s important to note that this is a “proposed” rule, and therefore won’t take effect unless and until it becomes a final rule. However, K-12 school and higher education institutions leaders would be prudent to begin immediately preparing for the eventuality of the rule becoming final.

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May 2023 Business Education Series Program

During the May Business Education Series, Emmie Musser will discuss the challenges faced by businesses in building trust and transparency in a hybrid world, and explore strategies to overcome them including the importance of clear communication and regular updates, as well as the need to establish and maintain strong relationships.

Why it Matters: We will share practical, evidenced based tips on policies, workplace communication norms, and technology that can be used to help mitigate some of the biggest pain points of a hybrid work environment. Learn more.

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Proposed Legislation Introduced to Reduce Employment Age to 19 in Marijuana Industry

In March, HB 4322 was introduced to allow individuals who are 19 years of age or older to be employed by or volunteer for marijuana establishments.

Why it Matters: Currently, the age for employment in the marijuana industry is set to 21. This legislation proposes to reduce the age to 19, and allow them to manufacture, purchase, distribute and sell marijuana accessories if the individual is acting on behalf of a marijuana establishment.

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Income Tax Reduced for Tax Year 2023

For tax year 2023, the state income tax will be reduced to 4.05%, but will go back up to 4.25% the following year due to a 2015 statute that requires a reduction in the income tax when revenues to the General Fund exceed inflation plus economic growth.

Why it Matters: Individuals should see a slight increase to their take-home pay, but it will not last for long as the income tax rate will go back to 4.25% starting in tax year 2024.

Related Practice Groups and Professionals

Labor, Employment & Civil Rights | David Houston
Cannabis Law | Sean Gallagher
Business & Tax | Paul McCord

Former Student Falsely Accused of Sexual Misconduct Wins $5.3 Million Jury Award for Defamation and Civil Conspiracy

A jury in South Carolina awarded a former Clemson University student $5.3 million in connection with defamation and civil conspiracy claims he brought against three individuals stemming from false allegations of sexual misconduct.

While the lawsuit against the individuals did not include a Title IX claim, the underlying circumstances did involve a Title IX investigation. In fact, the male student did bring suit against Clemson for violations of Title IX and the Due Process Clause of the 14th Amendment to the U.S. Constitution, and Clemson settled for an undisclosed amount.

This case is noteworthy because it resulted in such a large damage award based on accusations of sexual misconduct, and the resulting fallout from the investigation, which is something colleges and universities must frequently address.

The Facts of the Case

The case involved a female student who accused a male student of sexual misconduct. The male student alleged that their sexual encounter was consensual, and that his accuser only alleged misconduct and filed a Title IX complaint with the school (alleging she had been sexually assaulted while under the influence of alcohol), after her boyfriend learned of the encounter.

The accuser and her boyfriend allegedly began calling the male student a “rapist” to their friends. And the male student was suspended from Clemson and expelled from the university.

The Implications

This case demonstrates that Title IX investigations can be fraught with risks. Such cases often involve allegations like the ones described above, and colleges and universities need to carefully handle such investigations, including any actions they take on the basis of allegations made by the parties involved.

If you have any questions about this case, or Title IX issues in general, please contact Ryan Kauffman.

Ryan K. Kauffman is a Shareholder at Fraser Trebilcock with more than a decade of experience handling complex litigation matters and representing higher education institutions. You can contact him at rkauffman@fraserlawfirm.com or 517.377.0881.

Third Circuit Court of Appeals Rules that University can be Held Liable Under Title IX for On-Campus Murder by Nonstudent Guest

Following the on-campus murder of a student by her non-student boyfriend at Millersville University in 2015, the victim’s parents filed a Title IX claim against the university. The claim was rejected in a lower court, but, in a significant and consequential decision, the U.S. Court of Appeals for the Third Circuit reversed and held that the school could be held liable for the actions taken by a non-student guest on its campus.

This case serves as an important reminder for colleges and universities to pay close attention to their obligations under Title IX, and revisit and revise their policies as appropriate.

Case Background

The student-victim, Karlie Hall, was murdered in her dorm room by her boyfriend Gregorio Orrostieta.

Orrostieta was not a student, but he was a frequent visitor to the campus. In 2014, Hall was injured by Orrostieta in a domestic violence incident in her dorm room. Police responded, and Orrostieta was removed from campus, but no incident report was completed at the time. A resident advisor created an incident report, but the university’s administration failed to forward it to the school’s Title IX coordinator as required by school policy.

These and other facts were used to argue that the school acted with deliberate indifference to known harassment of a student.

The Court’s Analysis

Millersville University argued that it could not be held liable for the actions of a non-student guest on campus because it lacked notice that deliberate indifference to harassment, if perpetrated by a non-student guest, could result in Title IX liability.

In rejecting this argument, the Third Circuit cited the 1999 U.S. Supreme Court case, Davis v. Monroe County Board of Education. According to the Third Circuit:

“The Supreme Court made clear in Davis that a funding recipient may be liable for acts of sexual harassment by individuals other than students. Though Davis concerned only deliberate indifference to known student-on-student harassment, the Court’s holding was not based upon the classification of the harasser as a student, guest, or other type of third party … Instead, the Court’s focus was on whether the funding recipient had control over the harasser and the context of the harassment since the funding recipient can only ‘subject’ students to discrimination under Title IX if it has control over the harasser and remains deliberately indifferent to the harasser’s actions.”

The Third Circuit also stated the university’s Title IX policies in place at the time the incident occurred “contemplated Title IX liability could result from the actions of third parties such as ‘visitors’ like Orrostieta.”

While this decision was made by the Third Circuit, and therefore does not have precedential effect in the Sixth Circuit where Michigan colleges and universities are located, it nonetheless should serve as an important reminder to pay close attention to Title IX policies. The decision also comes shortly before the Biden administration is expected to release a Title IX notice of proposed rulemaking.

If you have any questions about this case, or Title IX issues in general, please contact Ryan Kauffman.

New Guidance Confirms that Title IX Protections Apply to the LGBTQ+ Community

The U.S. Department of Education’s Office of Civil Rights (“OCR”) recently issued a “Notice of Interpetation” confirming that Title IX protects students from harassment and discrimination based on their sexual orientation and/or gender identity.

This guidance is consistent with the 2020 Supreme Court decision in Bostock v. Clayton County in which the Court ruled that sex discrimination against gay and transgender employees was prohibited under Title VII of the Civil Rights Act. Title IX of the Education Amendments of 1972, 20 U.S.C. §§ 1681-1688, prohibits discrimination on the basis of sex in any educational program or activity offered by a recipient of federal financial assistance.

The OCR’s interpretation may offer students another path for pursuing legal remedies under Title IX, particularly in states with fewer protections for LGBTQ+ students. It is expected that this new guidance will be used to address such issues as college sports participation and locker room and bathroom usage consistent with student identities.

In light of the guidance, colleges and universities should review their Title IX policies with legal counsel and communicate with faculty and staff about the implications of the policy. They should also consider updates to internal processes and policies to ensure compliance when claims of harassment or discrimination are brought to campus officials.

Taking proactive steps is important because the OCR warns that it will enforce Title IX to prohibit discrimination based on sexual orientation and gender identity in education programs and activities that receive federal financial assistance from the Department of Education. This includes “allegations of individuals being harassed, disciplined in a discriminatory manner, excluded from, denied equal access to, or subjected to sex stereotyping in academic or extracurricular opportunities and other education programs or activities, denied the benefits of such programs or activities, or otherwise treated differently because of their sexual orientation or gender identity.”

If you have any questions, or require assistance, please contact Ryan Kauffman.

Ryan K. Kauffman is a Shareholder at Fraser Trebilcock with more than a decade of experience handling complex litigation matters. You can contact him at rkauffman@fraserlawfirm.com or 517.377.0881.