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Cypen & Cypen
APRIL 16, 2009

Stephen H. Cypen, Esq., Editor


Internal Revenue Service has issued guidance on the new Build America Bond program (IR-2009-033, April 3, 2009).  This program allows state and local governments to issue taxable bonds for capital projects and to receive a new direct federal subsidy payment from the Treasury Department for a portion of their borrowing costs.  The American Recovery and Reinvestment Act of 2009 creates the new Build America Bond program, which authorizes state and local governments to issue Build America Bonds as taxable bonds in 2009 and 2010 to finance any capital expenditures for which they otherwise could issue tax-exempt governmental bonds.  State and local governments receive a direct federal subsidy payment for a portion of their borrowing costs on Build America Bonds equal to 35 percent of the total coupon interest paid to investors.  This new program is intended to assist state and local governments in financing capital projects at lower borrowing costs and to stimulate the economy and create jobs.  IRS also issued Notice 2009-26,, which provides guidance on Build America Bonds to enable state and local governments to begin using the program.  The notice includes guidance on eligible types of projects and financings, initial implementation of the direct federal subsidy payment procedures, elections to use the program and information reporting for the program.  Certain guidance in this notice also applies to another type of Build America Bond in which a federal subsidy is delivered in the form of tax credits to investors instead of direct federal subsidy payments to state and local governments.


In an employment discrimination case, the issue on appeal was whether a police officer’s request to wear religious garb with a uniform could be reasonably accommodated without imposing an undue burden upon the City of Philadelphia.  Based upon the facts presented, the United States District Court held it could not. On appeal, the United States Court of Appeals for the Third Circuit agreed.  Webb was a practicing Muslim, employed by the City of Philadelphia as a police officer since 1995.  She requested permission from her commanding officer to wear a headscarf while in uniform and on duty.  The headscarf (a khimar or hijaab) is a traditional head covering worn by Muslim women.  Webb’s headscarf would cover neither her face nor her ears, but would cover her head and the back of her neck.  Her request was denied based upon an authoritative memorandum describing approved Philadelphia police uniforms, which did not authorize wearing of religious symbols or garb as part of the uniform.  Webb filed a complaint of religious discrimination under Title VII of the 1964 Civil Rights Act with the Equal Employment Opportunity Commission and the Pennsylvania Human Relations Commission.  While the matter was pending before EEOC, Webb arrived at work wearing her headscarf, refusing to remove it when so requested.  Webb was sent home, and informed her conduct could lead to disciplinary action.  Charges of insubordination were subsequently brought against Webb, resulting in a temporary 13-day suspension.  Webb brought suit against the City, asserting three causes of action under Title VII -- religious discrimination, retaliation/hostile work environment and sex discrimination.  The District Court found that the police directive and its detailed standards with no accommodation for religious symbols and attire not only promote need for uniformity, but also enhance cohesiveness, cooperation and the esprit de corps of the police force.  The trial court also held that the City would suffer an undue hardship if forced to permit Webb and other officers to wear religious clothing or ornamentation with their uniforms.  Webb appealed only the adverse judgments on her religious discrimination and sex discrimination claims.  The appellate court affirmed on both scores:  (1) if not for strict enforcement of the uniform code, essential values of impartiality, religious neutrality, uniformity and subordination of personal preference would be severely damaged to the detriment of proper functioning of the police department and (2) Webb did not file a charge of sex discrimination with EEOC, which was a pre-suit administrative requirement.  Webb v. City of Philadelphia, Case No. 07-3081 (U.S. 3d Cir., April 7, 2009). 


Investment Company Institute reports that combined assets of the nation’s mutual funds decreased by $372.1 Billion or 4.0%, from $9.408.5 Trillion to $9.036 Trillion in February.  Long-term funds, stock, bond and hybrid funds, had a net outflow of $12.13 Billion in February versus an inflow of $25.02 Billion in January.  Stock funds posted an outflow of $25.03 Billion in February compared with an inflow of $8.92 Billion in January.  Among stock funds, World Equity Funds (U.S. funds that invest primarily overseas) posted an outflow of $10.76 Billion in February versus an inflow of $2.21 Billion in January.  Funds that invest primarily in the U.S. had an outflow of $14.27 Billion in February against an inflow of $6.72 Billion in January,  Bond funds had an outflow of $17.15 Billion in February compared with an inflow of $16.51 Billion in January.  Money market funds had an outflow of $6.44 Billion in February as opposed to an inflow of $59.47 Billion in January.  Lesson?  Go with the flow.


In a recent family law appeal, a Florida court was faced with a final judgment of dissolution of marriage that ordered certain equitable distribution of assets between the parties, including the husband’s Social Security disability benefits.  On appeal, the husband argued that federal law prohibits treatment of Social Security disability benefits as marital assets.  However, the husband did not preserve the issue for appeal by making that specific argument in the trial court.  Thus, the argument was waived, so the court was not required to reach the issue.  (Because the court was not required to reach the issue, its opinion does not contain any cases cited by husband, or otherwise, supporting his contention.)  We will have to wait to another day.  Cox v. Cox, 34 Fla. L. Weekly D702 (Fla. 2d DCA, April 3, 2009). 


Saying “no” to your boss can be tricky, but here is a step-by-step approach from How to Manage Your Boss

1.            Acknowledge the importance of the issue (without showing resentment). 

2.            Answer with an unequivocal “no,” stating the precise reasons why.  Equivocating with “I’ll try...” or “I’ll see if I can do it...” does not usually end well. 

3.            Assist -- without getting involved -- by proposing alternative solutions. 

4.            Declare availability on your terms:  “I can do it if you take that other project off my desk and move this deadline.” 

It may not work, but it is respectful.  And, if forced to do it regardless, you will have covered your butt.


We all get angry or agitated at times.  It is amazing, though, how quickly many of these emotions fade away if we simply give them some time, instead of reacting immediately or impulsively.  Don’t Sweat the Small Stuff for Men recommends a “pause and come back to it” approach for a better, calmer life.  In effect, you permit yourself to get as angry or frustrated as you would like -- with one condition:  you clear your mind, forget about it for the next two hours and get on with your day.  If you are still angry later, go ahead and be angry.  The worst that can happen is that you will have had a chance to cool off and gain much-needed perspective.


Because persistence is a state of mind, it can be cultivated.  Here are four simple steps to the habit of persistence: 

  • A definite purpose backed by burning desire for its fulfillment. 


  • A definite plan, expressed in continuous action. 
  • A mind closed tightly against all negative and discouraging influences, including negative suggestions of relatives, friends and acquaintances. 


  • A friendly alliance with one or more persons who will encourage one to follow through with plan and purpose. 

These four steps are essential for success in all walks of life, at least according to Napoleon Hill.


Whether you want to be or not, your are a role model for your subordinates: 

  • Your personal opinion should be beyond reproach.  Your associates will try to look better if you look your best. 


  • Your personal behavior should be beyond reproach.  They will be well mannered and well spoken if you are. 
  • Your working hours should be punctual and well ordered.  Do not expect them to exert themselves if you leave at 3 to play tennis. 


  • Acknowledge their accomplishments and share your successes.  They will do the same; morale will be high. 
  • Keep your meetings short and your telephone calls even shorter.  They will accomplish more if they know your well organized work habits.


Advice from Rogers’ Rules for Success.


Here are some actions that you can take right now to develop a great attitude.  Substitute these for some of your current actions:  Be nice.  Be kind.  Smile.  Make friends.  Say nice things.  Take responsibility.  Praise others.  Be proud of your accomplishments.  Be proud of your work.  Don’t worry, be happy.  According to Little Gold Book of YES!  Attitude, these are actions that your mother has already told you a thousand times.  If she is still alive, call her on the phone right now and thank her for planting the seeds of positive attitude in your head.  Then apologize to her for thinking, at the time she was planting the seeds, that she was nagging you.  What are you waiting for?


The best way to fire someone is to let him resign, according to What They Still Don’t Teach You at Harvard Business School.  If you treat employees fairly on severance pay and help them find a new job, you will have earned their good will forever.  An ex-employee who has been fired “fairly” is less likely to bad mouth his ex-employer.  Orchestrating a resignation is not complicated, but don’t get too cute. The author finds it best to ease an employee into the situation.  Say “this is not working out.  I’ve decided that you ought to find another place to work.  I haven’t given much thought to the how or when, but why don’t you think about it for a couple of days and then we’ll talk more.”  Smooth.


STOCK ANALYST -- Idiot who just downgraded your stock.

STOCK SPLIT -- When your ex-wife and her lawyer split your assets equally between themselves. 



“By age 50, everyone has the face he deserves.”  George Orwell

Copyright, 1996-2009, all rights reserved.

Items in this Newsletter may be excerpts or summaries of original or secondary source material, and may have been reorganized for clarity and brevity. This Newsletter is general in nature and is not intended to provide specific legal or other advice.

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