Calfee Connections

What is the nature of innovation? Picture a tapestry interwoven with threads of simplicity and complexity. Some threads meticulously crafted through years of tireless research, while others emerge as astonishing strokes of serendipity. Innovation pirouettes along this vibrant spectrum with incremental steps, delicately building on the foundation of the known, and bold disruptions of the status quo, ripping through the fabric of convention. Can AI weave its own innovative tapestry of intention and happenstance? Of gradual evolution and revolutionary leaps?

Imagine a scenario where an American manufacturing company is approached by a potential international customer/seller of machinery claiming they know the best way to avoid either party paying heavy tariffs. Right away there are several red flags indicating this could be a potential high-risk transaction. Luckily, in this recent, real-life situation, the company knew to put a call in to their legal counsel to investigate further.

In the realm of innovation, there exists a conundrum known as the Innovator's Dilemma, a perplexing choice every innovator must face. Should the innovator cater to existing customer demands, pursuing incremental improvements the market readily comprehends? Or should they leap into the uncharted territory of disruptive innovation, where the customer and market have yet to fathom the need?

Disruptive innovation starts with a problem. However, the solution is the key. It must obsolete the current way of doing things. In the case of Kodak, photographic film obsoleted the need for photographic plates. With each disruptive innovation, there is no turning back to the way things were done.

Are you a California employer? Or are you a multi-state employer operating with some employees in California? Effective July 1, 2024, new Section 6401.9 of the California Labor Code requires nearly all California employers to implement a Workplace Violence Prevention Plan and corresponding training program. With very limited exceptions, California employers must adopt and effectuate a WVPP.

On the latest episode of Calfee NOW, Michael W. Bowen, Partner with the firm's Government Relations and Legislation practice, and Michael G. VanBuren, Partner with the firm's Health Care Regulation practice, spoke with Steve Millard, President and CEO of the Greater Akron Chamber.

The Tax Cuts and Jobs Act (TCJA) of 2017 doubled the 2018 basic exclusion amount from $5.6 million per person to $11.18 million per person. In 2023, an individual’s basic exclusion amount is $12.92 million and $25.84 million collectively for a married couple. This high basic exclusion amount means that many individuals will not need to pay an estate tax at death if they die in 2023.

However, on January 1, 2026, the basic exclusion amount is legislatively scheduled to be reduced to $5 million per person adjusted for inflation to an estimated $7 million per person or $14 million collectively for a married couple. This is almost $6 million less per person than today.

Now is the time for individuals with a net worth of $7 million or more and married couples with a net worth of $14 million or more to minimize their estate tax exposure.