Court Finds for Seventh Day Adventist Church in Trademark Dispute Between Two Churches

An interesting case was recently decided by the United States Court of Appeals for the Sixth Circuit.  It involved issues about the role of the Courts in deciding disputes between religious organizations.

In General Conference Corporation of Seventh-Day Adventists v. McGill, the Court of Appeals found for the Seventh-Day Adventists in a lawsuit against Walter McGill and the Creation 7^th Day Adventist Church.  This case arose out of a trademark dispute between the General Conference Corporation of Seventh-Day Adventists and Walter McGill, the founder of the Creation 7^th Day Adventist Church.

McGill was originally a member of the Seventh Day Adventist church affiliated with the Plaintiffs.  After a theological dispute, McGill split and formed his own church called “Creation 7^th Day Adventist Church.”

The Seventh Day Adventists had previously trademarked the name “Seventh Day Adventist.”  The Seventh Day Adventists brought suit against McGill for trademark infringement and the Court of Appeals upheld the District Court’s order granting summary judgment in favor of the Seventh Day Adventists.

McGill first argued that the Court lacked subject matter jurisdiction over this dispute because the Court would have to analyze religious doctrine in order to determine which party was the true 7^th Day Adventist.  McGill argued that there could only be one true 7^th Day Adventist and that the Court of Appeals lacked jurisdiction to determine which party was the true Seventh Day Adventist.

Rejecting this argument, the Court of Appeals held that “trademark law will not turn on whether the plaintiffs’ members or McGill and his congregants are the true believers.” The Court of Appeals found that it could use neutral principles of law to decide this trademark case.

McGill next argued that his rights were violated under the Religious Freedom Restoration Act (RFRA).  Specifically, McGill argued that enforcement of plaintiff’s trademarks would violate his free exercise clause because his religion mandates him to call his church the “Creation Seventh Day Adventist”.  Essentially, he argued that although he might be violating the trademark law, his religion required him to do so.

The Court of Appeals also rejected this argument.  The Court of Appeals found that even though an individual is bound by his religion to act or not act, he must still obey the law.  Further, the Court of Appeals found that the RFRA only applies to suits where the government is a party.  The Court of Appeals reasoned that Congress did not intend the RFRA to apply to private parties.

McGill also argued that the term “Seventh Day Adventism” cannot be trademarked.  He argued that the term Seventh Day Adventism referred to a religion and is therefore a generic term, that cannot be trademarked.  The Court of Appeals rejected this argument, finding that McGill could not sustain his burden of proving that the public perceived the term Seventh Day Adventist as a religion.

For these reasons, the Seventh Day Adventists were successful in their trademark infringement lawsuit against McGill.

This article was written by Matthew Ehrlich, Legal Clerk at Demorest Law Firm.

125 Posts!

We have now reached 125 posts on DetroitBusinessLaw.com. We would like to thank you for reading our articles. We look forward to keeping you up-to-date on developments we feel will be of interest to you. Keep reading!

Straight Talk from Gary Field, CPA

Those of you that have been around long enough are no strangers to government attempts to force national health care down your throats. Recall that no sooner was that fine upstanding American Bill Clinton put into office, January 20, 1993, he named our now Secretary of State, then First “Lady” Hillary Clinton to head a task force on national health care reform. Attempts to institute these reforms were abandoned in September 1994. I wrote the following about the then government grab for power;

The combination of the presidential election and legitimate calls for less expensive health care for all has thrown Congress into another feeding frenzy. This time it’s over national health insurance, so hang on to your wallet. Most of Congress supports some form of “pay-or-play: scheme.

Under the “pay-or-play”, employers either provide government determined minimum health insurance or pay a payroll tax to enroll employees in a federal health insurance plan. This would do nothing more than soak employers, taxpayers, and cut the quality of health care. Their proposal would result in throwing money at costly “cures” that are worse than the ailment. The last thing taxpayers need is a new government program twice the size of Medicare.

As an employer, my vote goes to health care for all without government intervention. That would benefit 31 to 36 million Americans currently uninsured. To solve the health care problem, let’s start with a positive logical approach that clearly defines the bigger problems and provides reforms which are not politically motivated.

• Monopolies in the provision of care must be broken to lower costs. Something is wrong with a system that has been pushing up health care costs at an average of nearly 9% a year for the last decade. That’s nearly twice the rate of inflation.

• Participants should share in more of the costs. As a group, we have become health care junkies. We don’t have a truly free market system as long as medical insurance drives demand, and patients are unwilling or unable to learn the true price of services they’re buying.

• The escalating burden of malpractice suits must be stopped. Witness plaintiffs in hot pursuit of Eli Lilley, maker of the anti-depressant drug Prozac: or Upjohn, maker of the popular sleeping pill Halcion and most recently Dow Corning as maker silicone gel breast implants. Forbes magazine labels this litigation cost a “tort tax”. According to a recent article, tort claims cost the country $117 billion dollars in 1987. Medical doctors, faced with the threat of malpractice, have resorted to defensive medicine, particularly in the form of redundant testing.

• The medical profession has to be held accountable and to a higher standard. Although most business people compete on price, doctors rarely do. The absence of effective economic controls, as would naturally occur in a free market, creates anomalies. For example, Detroit’s rate of caesarean birth, which is five times more expensive that vaginal birth, is double that of Minneapolis. For this country as a whole, C-sections have increased 500% in the last two decades. To my knowledge, there’s no medical evidence that can explain this interesting phenomenon. Are Detroit C-section rates higher than Minneapolis’ because C-sections pay better on Medicaid fee schedules when compared to normal deliveries? I have to wonder.

• Since the inception of the Canadian system in 1971, the real cost of per capita health care has gone up and now exceeds that of the largest HMO’s in the U.S.

• The average hospital stay in Canada is 42% longer than in the U.S. Therefore, the system is no more efficient.

• Canadians are flocking to the U.S. to get health care they cannot get at home. In many cases, medial appointments must be scheduled one year in advance. Plan your illnesses carefully!

Other countries that have had a brush with national health insurance are now moving in the opposite direction. The father of Quebec’s health care system now advocates privatization and competition; Sweden is introducing “managed competition” and New Zealand is ending a forty year experiment with socialized medicine by giving people tax incentives to purchase private insurance.

Clearly, national health insurance is an attempt to make the federal government responsible for our well-being. Although there is a mindset that buys into that, I believe they are the minority. Lawmakers encourage our irresponsibility because the platform sells. However, allowing the government to assume responsibility for health care can only end in frustration. The government will simply take increasing levels of control while leaving us with 100% responsibility and accountability for our lives. That is one more reason why as government grows larger, their populations grow more frustrated and unhappy. In fact, government control has culminated in endless taxation, endless regulation, enormous bureaucracy and the lowest level of public service ever experienced.

Congress must learn that solutions to social problems can be found in the tried and proven mechanisms of free market, not by clogging the system with further governmental controls or by bleeding taxpayers through a government-administered national health care plan. I believe my proposal could help us achieve all of our objectives at a much lower cost.

In my opinion, the arguments against national health care haven’t changed much.  What has changed since I wrote this piece 15+ years ago is that the American people have lost their way and greed and impatience have become an even bigger part of our lives. Specifically the American people have become more inclined to let government take more and more control of our individual freedoms and allowed scoundrels, like the “leaders” on Wall Street and the Obama administration pillage the United States Treasury.

While there is no doubt that the health care system needs help, it is still, bar none, the best system in the world. It is equally clear that the current administration with its attitude of “From each according to his ability to each according to his need” is hell bent on forcing national health care down our throats whether we like it or not.

God help America.

This article was written by Gary Field, CPA at Numerico, PC. Click here to view Numerico’s website.

IRS Proposes New Rules for Tax Preparers

The IRS has recently announced a new set of proposed rules for tax preparers. If enacted, the new rules would become effective January 1, 2011.  According to the proposed rules, all paid tax preparers would be required to:

1. Register with the IRS and obtain a preparer tax identification number. Once a preparer is registered, the IRS will be able to verify that the preparer has filed his or her personal tax returns and business and employment tax returns, along with paying the taxes on those returns. If the paid tax preparer has not filed those returns timely or paid the taxes due, penalties can be imposed by the IRS, including a prohibition on filing tax returns for clients.

2. Submit to a competency test. This rule does not apply to attorneys and certified public accountants that are active and in good standing with their licensing agencies.

3. Obtain continuing professional education. Again this rule does not apply to the attorneys and certified public accountants of Demorest Law Firm, PLLC, or Numerico, P.C. since we have our own requirements from the Michigan Bar Association and the Michigan Association of Certified Public Accountants.

In my opinion, the proposed new rules are long overdue. Currently, only certified public accountants, attorneys and enrolled agents have standards that are implemented by their individual associations. For far too long, tax preparers have been able to put a sign up that says Joe’s Tax Service, yet they were not required to have any formal training, testing or registration requirements. The IRS is beginning to understand the complexities and dangers involved in regulating an industry with certain unregulated components.

Hopefully these proposed regulations will add a serious deterrent to the fraudulent or incompetent preparers that we hear about far too often in stories from individual taxpayers such as “I don’t know why I got such a large refund, my preparer just had me sign the return and I didn’t get all of the reported refund.” “ I didn’t know that I hadn’t been filing returns, I thought my preparer had already filed them.” “What do you mean that I have not paid my employment taxes for my business or filed my employment tax forms? I gave my paid tax preparer access to my Company’s bank account and electronic withdrawals for the employment taxes were taken from my bank account.”

To read the IRS proposed regulations please click here.

Happy New Year – See You Next Week!

Importance of I-9 (Work Eligibility) Forms

Recently, the US Immigration and Customs Enforcement Agency assessed over $40,000 in fines to a Detroit-area company because the company failed to properly complete I-9 eligibility forms for about 100 of its workers. There was no allegation that the company knowingly hired illegal workers. The fine was assessed for failing to complete the proper forms. The government has now filed a lawsuit to collect those fines. The eligibility forms attest to the fact that the employee is indeed eligible to work in the United States. Business owners need to be proactive in seeking documentation of work eligibility before hiring new employees. It is much easier to deal with these issues up front than it is to deal with Immigration and Customs Enforcement and substantial fines for not complying.

Read the recent Detroit Free Press Article Here

Favorable Roth Conversion Rules around the Corner

Way back in 2006 Congress included a provision in the Tax Increase Prevention & Reconciliation Act (TIPRA) that eliminated the modified adjusted gross income phase out rules in regards to Roth IRA Conversions that occur in 2010.

It is amazing to me that the current occupants of Congress and the White House have not removed this provision due to soaring budget deficits. After all they are taking the short sighted view of getting tax money today while they are in office, at the expense of getting no tax money in future years from traditional IRA distributions, when they may no longer be in office.

As we have seen over the years anything written into law can also be undone when it no longer benefits the party that is in power. However let’s assume that the politicians decide to enact this provision in the law. Should you take advantage of this opportunity, well it depends on your facts and circumstances, as well as where you think that tax rates are headed in the future.

Susan Tompor’s of the Detroit Free Press in an article entitled “Roth IRA conversion isn’t for everyone” provides a good summary of the pros and cons in regards to whether your should entertain the idea of a Roth IRA conversion.

To read her article please click here. http://www.freep.com/article/20091119/COL07/911190463/1088/Roth-IRA-conversion-isnt-for-everyone

You can also check out our Roth conversion calculator at http://www.numerico.com/calc-section.php?category=Retirement Then click on the Roth IRA Transfer Evaluator link to run the calculation.

This article was written by Jay Kossen, CPA at Numerico, PC. Click here to view Numerico’s website.

Time to Give Thanks! (See you Monday)

As we all know, 2009 has not been an easy year for businesses, especially here in the Detroit area.  However, economic struggles often create new opportunities, and we hope that this Blog is helping you with your business opportunities.  It’s time to give thanks for those opportunities (and maybe to give thanks that 2009 is almost over).

Those of us at Detroit Business Law, Demorest Law Firm, and Numerico are thankful for the opportunity to provide our readers with information, as well as the opportunity to reach a new audience.  Be sure to let us know if there’s a specific issue that you’d like us to cover in the future.

Enjoy your Thanksgiving and we’ll be back with a new post on Monday, November 30.

This article was written by Melissa L. Demorest, Associate at Demorest Law Firm.

New York Times Article – “Eleven Easy Ways to Destroy Your Company”

Blogger Jay Goltz of the New York Times wrote an article recently entitled “Eleven Easy Ways to Destroy Your Company”.  This is certainly worth a read for any business owner.

The article ends with a great line, “an ounce of prevention is worth a pound of cure.”  We talk to our clients on a daily basis about making sound decisions and proper planning.  Hopefully this article is a step in that direction for your business.

Please let us know how we can help.

Click here to read.

Our 50th Post

We wanted to take a moment to thank those of you who have been reading DetroitBusinessLaw.com for the past several months.  We are excited to have reached the 50 post mark.

We are committed to helping your business stay informed and get ahead.  Please feel free to invite other business owners you know to read our articles as well, and please comment with your insights!