Columns

Many Michigan business owners are feeling something they have not felt in a while: a bit of breathing room. Supply chains have steadied. The pace of change feels less frantic. 

Many Michigan business owners are feeling something they have not felt in a while: a bit of breathing room. Supply chains have steadied. The pace of change feels less frantic. 

Yet from where I sit, advising mid-sized Michigan companies day in and day out, this is not a year to get comfortable. The risks have not disappeared; they have simply become quieter and more complex.

The businesses that struggle in 2026 will not be caught off guard by a brand-new law. More often, problems grow out of familiar issues that were left unattended for too long. The companies that do well tend to be the ones that treat legal planning as part of running the business, not something reserved for emergencies.

Artificial Intelligence Is Now a Business Risk, Not a Tech Experiment

Most Michigan companies I work with are already using artificial intelligence in some form, often without calling it that. It shows up in hiring platforms, marketing tools, customer communications, and internal drafting. 

The legal conversation around artificial intelligence has shifted. The question is no longer whether businesses are using it, but whether they understand how it is being used and who is responsible when something goes wrong.

Michigan does not yet have a stand-alone artificial intelligence statute, but federal guidance is increasingly shaping how courts and regulators evaluate automated decision-making, particularly in employment and consumer-facing contexts. At the same time, contracts are quietly doing much of the regulating. Vendors and customers are asking for representations about artificial intelligence use, data sources, human oversight, and cybersecurity safeguards. Under Michigan law, those provisions are likely to be enforced as written, which means companies need to be comfortable with the commitments they are making before they sign.

Data privacy expectations are catching up with smaller companies

Many Michigan business owners still assume data privacy is an issue only for large technology companies. 

That assumption is becoming riskier each year. As additional state privacy laws take effect across the country, Michigan businesses can find themselves subject to new requirements simply by collecting data from customers or users who live elsewhere.

Michigan’s Identity Theft Protection Act has been in place for years, but expectations around compliance have matured. Regulators increasingly expect written policies, documented safeguards, and a clear plan for responding to a breach. 

Informal practices that once seemed reasonable can look careless when reviewed after an incident, especially when multiple states are involved.

Worker Classification and Remote Work Remain High-Risk Areas

Few areas create more avoidable exposure for Michigan companies than worker classification. 

In 2026, both federal agencies and Michigan regulators continue to scrutinize independent contractor arrangements, particularly in professional services, logistics, and remote roles. 

The analysis remains highly fact-specific, and mistakes often lead to cascading consequences that include wage claims, tax exposure, and benefit issues.

Remote and hybrid work have added another layer of complexity. Wage and hour compliance, overtime tracking, and expense reimbursement obligations do not disappear simply because work happens off-site. Many employee handbooks and compensation structures no longer reflect how work is actually performed, which can leave well-intentioned employers exposed.

Michigan Business Transitions Are Accelerating

Across Michigan, more owners are beginning to think seriously about what comes next. For some, that means a sale. For others, it means an internal buyout or a generational transition. Private equity interest remains strong, but buyers are far less forgiving of informality than they once were. Gaps in governance, undocumented processes, and weak cybersecurity practices tend to surface quickly during due diligence and often affect value.

Even companies that are not actively marketing themselves benefit from thinking like a future buyer. Clear decision-making authority, clean financial practices, and documented systems tend to make businesses easier to operate and more resilient, regardless of whether a transaction occurs.

Nonprofits and Mission-Driven Entities Face More Oversight

Michigan nonprofits and organizations that work closely with them are operating under increased scrutiny in 2026. The Michigan Attorney General’s Charitable Trust Section continues to focus on governance practices, conflicts of interest, and fundraising transparency, while the Internal Revenue Service remains attentive to board independence and compliance.

At the same time, more organizations are exploring benefit corporations and other hybrid structures to balance mission and sustainability. These models can be effective, but only when the underlying governance documents clearly define roles, authority, and fiduciary obligations.

Final Thought

What unites these trends is accountability. Regulators, customers, employees, and business partners are asking better questions and expecting clearer answers. Michigan law has long favored preparation over improvisation, and that remains true in 2026.

Companies that integrate legal foresight into everyday decision-making, rather than treating counsel as a last resort, will be best positioned to manage risk, protect value, and grow with confidence.

2026 is well underway. The opportunity now is to mind your Michigan business before someone else is forced to do it for you.

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Zana Tomich is a seasoned attorney based in Detroit with over two decades of experience advising businesses and nonprofit organizations.

Given the massive media coverage on the Venezuelan raid, one aspect — an intriguing and fascinating journalism ethics issue — has received very little, if any, attention.

Given the massive media coverage on the Venezuelan raid, one aspect — an intriguing and fascinating journalism ethics issue — has received very little, if any, attention.

It deserves a deep and penetrating analysis.

As the reporting started, I wondered, given the numerous agencies and thousands involved in the planning, how the plan remained secret.

It turns out it didn’t.

The New York Times, The Washington Post and other media outlets learned of plans for the attack but were asked by the administration not to publish any stories.

Administration officials presumably argued:

• Publicity would eliminate the crucial element of surprise.

• To scuttle the military action would waste millions if not billions of dollars spent in planning.

• To proceed after publication of the proposed raid would jeopardize the lives of military personnel.

So, what to do?

To concur would imply, justified or not, agreement with the operation. That is not the role of a reporter. 

And, equally important, the media would not have any of the classified information needed to make a decision whether the attack was warranted.

Holding back would risk losing a huge story to a competitor who may decide to run with the story.  That could have major financial implications for those complying with the request of what some would call “censorship.”

Those who would “spike” the story would lose credibility with their TV and newspaper subscribers if others proceeded with publication.

Moreover, shouldn’t the public be informed on what its government is planning?

This ethical quandary is one of the most serious conundrums for journalists, one on which I spent significant time examining with students when I taught journalism ethics at Wayne State University.

Are there any precedents to help us with this? Well, there is at least one.

In April 1961, only three months after taking office, President Kennedy approved a military operation to overthrow the regime of Fidel Castro who had aligned himself with communist Russia.  

The plan leaked out with James Reston, the renowned New York Times political columnist ready to publish a story on what became known as the “Bay of Pigs” operation.

Kennedy called Reston and Times owners, asking them to hold back, making arguments like the ones cited above.

The Times agreed. The attack proceeded as planned, but the invasion, lasting only three days, was a dismal failure.

After the embarrassing defeat, astonishingly, Kennedy told The Times executives that perhaps the paper should have published the story because he probably would have scuttled the attack.

He reportedly said: “if you had printed more about the operation, you would have saved us from a colossal mistake.” 

More than a year later, Kennedy told New York Times Publisher Orvil Dryfoos, “I wish you had run everything on Cuba…I am just sorry you didn’t tell it at the time.”

Ah, hindsight.

But the major underlying ethic of this dilemma is whether journalists must or need to consider the consequences of their stories.  

The answer is “no” because every single story has consequences.

• Publishing premature stories on the construction of a new hotel has consequences.

• Stories on proposed but not yet adopted legislation have consequences.

• Stories on politicians resigning or not running for re-election have consequences.

• In sports, planned trades of major star athletes have consequences.

The list is endless. Moreover, the role of a journalist is not that of a partisan but instead of an objective informer. (I am discussing straight news reporting not editorial comment.)

If the media were to consider consequences of their actions, they would publish nothing.

However…

There is one exception: When lives are at stake as was and is the case of the Bay of Pigs and Venezuela operations.

The media cannot turn a blind eye to the possibility that publication could cost lives. That is an entirely different matter.

Let’s consider other situations:

• Should any media institution publish reports that police authorities were planning to conduct a raid to free a kidnap victim held hostage?

• Should a reporter, embedded in the U.S. military, write of proposed battle plans?

• Should the media publish the names of U.S. spies operating in enemy countries?

But, critics of the invasion of Venezuela would argue that if the plan by the Trump administration had been made public, it could have saved the country — and the world — a serious crisis?

That may — or not — be true.  But, the media cannot and must not make such judgments because, again, every single story has good and bad ramifications for someone — individuals, businesses, political parties, religious and educational institutions, etc.  And, as in the Bay of Pigs invasion, the media do not have all the information required to make a sound and comprehension decision on the merits of the attack.

Were news reporters (not opinion writers) to make partisan judgments, well, talk about opening a Pandora’s Box.  

(Indeed, many in the media are now accused of political biases. But that’s a topic for a future column, two or more. I also expect some will view this column as pro-Trump, although those who have followed my rantings on Trump for a decade know better. Admittedly, given Trump’s pathological lying, making an informed, fair and sensitive decision — to publish or not to publish — is much more difficult.)

Thus, although many will criticize the decisions made by the media in the Bay of Pigs and Venezuelan operations, the judgments made were correct — as much as we may, in retrospect, wish the results had been different.

—————

Berl Falbaum is a long-time journalist, author, and educator, and contributing columnist to The Legal News.

The Supreme Court’s unanimous decision in Ames v. Ohio Department of Youth Services, 605 U.S. 303 (2025) not only resolved a longstanding circuit split over the evidentiary burden for majority-group plaintiffs under Title VII, but also signaled a broader shift in how courts may approach employment discrimination claims going forward.

The Supreme Court’s unanimous decision in Ames v. Ohio Department of Youth Services, 605 U.S. 303 (2025) not only resolved a longstanding circuit split over the evidentiary burden for majority-group plaintiffs under Title VII, but also signaled a broader shift in how courts may approach employment discrimination claims going forward.

The Court held that members of a “majority group”— i.e., those belonging to groups that have not historically faced discrimination — no longer have a heightened evidentiary burden compared to minority groups: they need not prove “background circumstances” to support that the employer unusually discriminated against the majority.

The plaintiff (who is heterosexual) alleged that her employer violated Title VII when it denied her a promotion in favor of a homosexual female, then demoted her and replaced her in her prior position with a homosexual male. She claimed that her employer denied her the promotion and demoted her because of her heterosexual sexual orientation. While these facts would ordinarily satisfy her burden under the first step of the McDonnell Douglas framework,  under Sixth Circuit precedent, as a member of a majority group, she was required to provide additional evidence, such as statistical proof or information about the relevant decisionmaker’s protected traits. She failed to produce such evidence, leading to dismissal of the case on summary judgment.

Justice Jackson’s opinion emphasized that Title VII protects “any individual” from discrimination based on protected characteristics, regardless of whether the person belongs to a majority or minority group. The Court rejected the Sixth Circuit’s “background circumstances” rule, which had required majority-group plaintiffs to provide additional proof—such as statistical evidence or information about the protected traits the decisionmaker may have—to establish a prima facie case. The Court found this rule to be inconsistent with both the text of Title VII and its own precedent, which discourages rigid applications of the McDonnell Douglas framework.

This ruling effectively levels the playing field for all plaintiffs, removing a procedural barrier that affected only majority-group litigants. As a result, courts must now evaluate claims of discrimination based solely on whether the plaintiff can show that they suffered an adverse employment action because of a protected characteristic—without regard to group membership. This change may lead to an increase in majority-group litigants bringing claims previously characterized as reverse discrimination. It is now much easier for these litigants to meet their prima facie burden, which will likely allow numerous plaintiffs to proceed to trial who would previously have had their cases dismissed on summary judgment.

Justice Thomas, joined by Justice Gorsuch, went further. In his concurrence, he argued that the McDonnell Douglas burden-shifting framework itself lacks textual support in Title VII and should be reconsidered in a future case. He criticized the framework form creating unnecessary complexity and for fostering inconsistent standards between cases involving direct and circumstantial evidence.

Justice Thomas’s critique is not new—he has long expressed skepticism about judge-made doctrines that stray from statutory text. But in Ames, his argument gained new traction. He noted that Title VII’s plain language requires courts to determine whether there is evidence of intentional discrimination, and that the burden-shifting approach may obscure that inquiry rather than clarify it.

If the Court were to adopt Justice Thomas’s view and eliminate the McDonnell Douglas framework, the implications would be profound:

• Simplified litigation: Plaintiffs would no longer need to navigate the three-step burden-shifting process. Instead, courts would focus directly on whether the evidence supports a finding of intentional discrimination.

• Increased judicial discretion: Without a structured framework, judges may have more latitude in evaluating the sufficiency of evidence, leading to less predictable outcomes.

• Impact on DEI programs: Justice Thomas’s concurrence may invite increased scrutiny of diversity, equity, and inclusion (DEI) initiatives. Programs that appear to favor minority groups could be challenged under the now-equal evidentiary standard for majority-group plaintiffs.

• Shift in summary judgment practice: The McDonnell Douglas framework has long served as a gatekeeping tool at the summary judgment stage. Its removal could result in more cases proceeding to trial, increasing litigation costs and risks for employers.

  Courts analyze employment discrimination claims under the Supreme Court’s framework outlined in McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973), in which the plaintiff is required to make an initial showing of discriminatory intent, after which the burden shifts to the defendant to provide a legitimate, nondiscriminatory reason for its employment action. If the defendant makes such a showing, the burden shifts back to the plaintiff to present evidence that the defendant’s proffered reason is a “pretext,” or cover, for discrimination.

Erica L. Quigley is an Associate at Miller Johnson in the Employment and Labor practice group, focusing on management-side labor and employment counseling and litigation, as well as governmental legal matters. She advises clients on employment contracts, workplace policies, compliance with wage and hour laws, health and safety regulations, and employee discipline.
Quigley has successfully represented clients in state and federal courts on issues including discrimination, harassment, retaliation, FMLA, and constitutional violations. She counsels on traditional labor and election law matters. A graduate of Wayne State University Law School, Quigley has received multiple honors and serves as Co-Chair of the Labor and Employment Section of the Washtenaw County Bar Association. Quigley can be reached at 313-435-2323 or at quigleye@millerjohnson.com.
Adam M. Taub is a founding partner at Croson, Taub, & Michaels, PLLC where he is an advocate for workers. He specializes in all forms of workplace disputes, including wrongful termination, discrimination, harassment, whistleblower, non-compete, and wage and hour issues. Taub has also successfully represented public and private sector unions. He has represented numerous individuals and labor unions against employers in federal and state courts, as well as administrative agencies, including EEOC, OSHA, NLRB, and MERC. Taub can be reached at 734-519-0874 or at ataub@ctmlawyers.com.

Reprinted with permission from the Washtenaw County Bar Association newsletter Res Ipsa Loquitur.

Zana Tomich
Dalton & Tomich PLC 

Most businesses don’t realize exactly when they stop operating like a startup and start functioning as an established organization. There is no announcement, no line on the calendar. The shift usually happens quietly, often right around the time the company prepares to bring on its tenth employee.

Why focus on ten employees? There is no federal employment law that suddenly takes effect at the ten-employee mark. 

The significance is practical, not statutory. Once a business grows beyond a handful of people, informal management stops working. Founders are no longer part of every conversation, decisions are made without shared assumptions, and small inconsistencies can create real legal exposure. Wage and hour issues become harder to monitor, confidentiality risks expand, and HR complaints often appear for the first time when a business reaches eight to twelve employees. 

In short, ten employees is the point where a company becomes complex enough that written policies move from optional to essential.

At this stage, a founder’s instincts and a few verbal ground rules are no longer enough to keep people aligned. Employees begin making decisions without the benefit of overhearing the leadership team. Departments form, roles blur, misunderstandings multiply, and the business faces risks that did not exist when four people shared a room and improvised their way through the day.

This is the moment, before employee number ten walks through the door, when every small business should put three foundational policies in writing. The goal is not to become “corporate.” The goal is to preserve stability, fairness, and clarity as the company grows.

1. A clear, modern employee handbook. (Because “we talked about it once” is not a policy)

Many small-business owners believe they do not need a handbook because “everyone knows how we operate.” 

That may work for the first few employees who learned the business while sitting next to the founders. Once the company reaches ten employees, people no longer learn by osmosis.

A strong handbook does not need to be lengthy. It should clearly address the issues that most often create tension, including:

• How employment works, including an at-will statement;

• Standards of conduct and what will not be tolerated;

• How performance concerns and complaints are handled;

• Attendance, scheduling, and time-tracking expectations;

• Technology and cybersecurity requirements;

• How time off actually works;

• A simple, safe process for raising concerns without retaliation.

The value of a handbook is not the document itself. It is the consistency it provides. When a difficult situation arises and an employee insists “no one ever told me that,” the handbook becomes your record, your clarity, and your protection.

2. A robust confidentiality and trade-secret policy (Because your business is worth protecting long before you are big enough to defend it)

Every business has information someone else would love to access. This includes customer lists, pricing strategies, sales processes, vendor relationships, product formulas, software code, operational methods, and market positioning plans.

Small companies are particularly vulnerable because they often rely on trust and informality. 

Courts, however, do not protect trade secrets based on trust. They protect them based on the steps a company takes to keep information confidential. If you do not treat something as proprietary, you cannot credibly object when someone walks out with it.

A well-drafted confidentiality and trade-secret policy defines what is confidential, who may access it, how it must be handled, and the consequences for misuse. It also provides a legal foundation for action if an employee attempts to take shortcuts or a competitor tries to capitalize on your work.

With non-compete agreements rapidly disappearing across the country, this policy has become one of the few remaining tools available to safeguard a business’s competitive advantage.

3. A Code of Conduct that reflects your culture (Not a generic list of corporate clichés)

Culture is what keeps a small business cohesive during growth. When the team is tiny, everyone absorbs the founder’s values simply by being in close proximity. As the company expands, that shared understanding disappears unless someone puts it in writing.

A Code of Conduct is your blueprint for how people interact. It should not sound like a template pulled from a corporate HR manual. It should reflect your voice and express the norms you expect your team to follow.

A practical and meaningful Code of Conduct addresses:

• Expectations around communication;

• Standards for professionalism and respect;

• How disagreements should be approached;

• When and how decisions are escalated;

• What accountability looks like;

• What “respecting the team” means in your environment.

This is not about micromanaging. It is about giving new hires a clear path to success, reducing unnecessary friction, and preserving the culture you worked hard to build.

Why these policies matter before you reach 10 employees

Crossing the 10-employee threshold signals three major chances:

1. Legal exposure expands quickly. Each new hire brings additional HR, wage-and-hour, and confidentiality risks.

2. Culture becomes more fragile. A single new employee can shift the identity of a small business.

3. Consistency becomes essential. What once felt like flexibility can quickly be misunderstood as favoritism or unfairness.

These policies create the guardrails that allow a company to grow without losing stability. They protect your brand, your people, and the business you have worked so hard to build. 

I have worked with many companies that waited until a crisis forced them to put policies in place. Every one of them later said the same thing: “We should have done this earlier.” The businesses that thrive are the ones that prepare before the pressure hits. Employee number 10 is your early warning bell. Put these policies in place now, and your future self will thank you.

The first two commentaries focused on Benjamin Franklin. This commentary will discuss an individual well known to Colonial leaders but less familiar in the present day: David Rittenhouse (1732-96). 

This is the third commentary in a series describing the perspectives of the Founding Fathers on “thinking like a scientist.” 

The first two commentaries focused on Benjamin Franklin. This commentary will discuss an individual well known to Colonial leaders but less familiar in the present day: David Rittenhouse (1732-96). 

Rittenhouse was “America’s Newton.”  A child genius and the son of farmers, Rittenhouse received only a basic education and thereafter self-taught.  At age 13, he mastered Newton’s calculus as well as the laws of gravity and motion.  

Rittenhouse would go on to construct models of paper mills, then working clocks, tools and as an adult, scientific instruments including two orreries – mechanical scale models of the Solar System – still in existence at Princeton and the University of Pennsylvania.

Rittenhouse’s report on the transit path of Venus in 1769 brought international fame as an astronomer.  The telescope he utilized to make the detailed observations was of his own making.  

An Oration “Promoting Useful Knowledge” that Rittenhouse delivered in February 1775 to the American Philosophical Society, which was originally founded by Benjamin Franklin, is the focus of this commentary.  

The Oration was later published in a pamphlet addressed to the delegates of the Continental Congress “to whom the future liberties and, consequently, the virtue, improvement in science, of America are entrusted.”  Each delegate received a personal copy.

The Oration is of value today because it presents Rittenhouse’s views – in his own words - of what it means to “think like a scientist.”

 Excerpts are set forth below. The headings are mine; the quoted text is from the Oration with guidance as to context and particular terms in brackets.

On the Relationship of Scientific Discovery to Religion  

“As truth is always consistent with itself, so many new proofs were furnished from time to time by new discoveries, that a mistaken interpretation of some passages in the Bible was compelled to give way to the force of astronomical evidence.

“Our religion teaches us what Philosophy could not have … But neither Religion nor Philosophy forbids us to believe that [the creator’s] infinite wisdom and power … may have frequently interposed in a manner quite incomprehensible to us, when [understanding] became necessary to the happiness of created beings.”

Implications with Respect to Other Worlds  

In the middle section of the Oration, Rittenhouse notes that advances in astronomy may include the discovery of planetary life elsewhere in the universe. He cleverly uses that possibility as a springboard to address several “hot-button” political issues.  

“How far indeed the inhabitants of the other planets may resemble man, we cannot pretend to say … If their inhabitants resemble man in their faculties and affections, let us suppose that they are wise enough to govern themselves according to the dictates that reason their creator has given them … Happy people!”

Rittenhouse then pivots to note that from the perspective of this “happy people,” existing governments on earth lack similar wisdom and proceeds to provide examples.

On Slavery and Racism

First, Rittenhouse speculates that “inhabitants of the other planets” may be “more happy still, that all communication with us is [currently] denied.  We have neither corrupted you with our vices nor injured you by violence …  None of your sons and daughters, degraded from their native dignity, have been doomed to endless slavery by us in America, merely because their bodies maybe disposed to reflect or absorb the rays of light, in a way different from ours.”

On Greed

Second, citing additional benefits resulting from the separation of worlds, Rittenhouse notes that “you [inhabitants of other worlds] are [also] effectively secured, alike from the rapacious hand of the haughty Spaniard, and of the unfeeling British nabob. Even British thunder [canons] impelled by British thirst of gain, cannot reach you.” [“British nabob” was a pejorative reference to “a conspicuously wealthy individual returning from India with a fortune.”]

On Luxury and Tyranny

As an example of “tyrannical” government actions on earth, Rittenhouse next cites the highly contentious British colonial acts, such as the Stamp Act.

These Colonial rules required Americans to import high-priced “luxury” goods through Britain rather than manufacture or obtain them elsewhere. 

They were then the subject of the incendiary colonial protests and boycotts that would spark the Revolutionary War only two months after the Oration was first delivered.

“Luxury and tyranny …  pretend at first to be the patrons of science and philosophy, but at length fail not effectively to destroy them; agitated by these reflections, I am ready to wish that nature would raise her everlasting bars between the new and old world; and make voyage to Europe as impracticable as one to the moon … Let our harbours, our doors, our hearts, be shut against luxury.”  

The Benefits of Science

In closing, Rittenhouse turns “to consider [the] happy effects of science, on the human mind … it is of great service to mankind, in banishing bigotry and superstition from amongst us … to dilate the heart with universal benevolence, and to enlarge its views.  

[Science] does this without propagating a single point of doctrine contrary to common sense, or the most cultivated reason. It flatters no fashionable princely vice, or national depravity. It encourages not the libertine by relaxing any of the precepts of morality.” 

Rittenhouse’s ambitions for science to have a central role in transforming American life were reflective of Revolutionary times.   

Historians suggest his idealism and optimism, in fact, influenced the selection of a circle of thirteen stars in the republic’s first flag symbolizing American democracy as a “new Constellation” in the progress of humankind.

Law, it seems, is changing rapidly at the state and federal level. It can be difficult to keep up with the transformation of entire areas of substantive law. There is a kind of reordering of things, which includes revisiting established precedents to correct perceived legal errors in prior rulings. 

Law, it seems, is changing rapidly at the state and federal level. It can be difficult to keep up with the transformation of entire areas of substantive law. There is a kind of reordering of things, which includes revisiting established precedents to correct perceived legal errors in prior rulings. 

The Michigan Supreme Court has distinguished itself nationally by taking a measured approach. Although the justices are popularly elected, the Court doesn’t appear to be actively looking for ways to take up controversial issues. The Court has shown a willingness to reexamine precedent, however. 

One case the Court should look at is Nehra v. Provident Life and Accident Company, 454 Mich. 110 (1997) involving the interpretation of disability insurance contracts for professionals like surgeons. 

If the case sounds unfamiliar, it is. 

Even seasoned Supreme Court advocates hadn’t heard of it. Nehra is rarely cited and even more rarely followed. Most cases that cite it, distinguish it. 

Nehra is a decision that proves again the old adage that ‘bad facts can make bad law.’  The problem with Nehra – in addition to being a bad decision – is that it serves to undermine the long-term financial security of professionals in certain industries, particularly medicine. 

In Nehra, the plaintiff, a dentist, filed an insurance claim with his long-term disability insurance carrier. His policy provided coverage in the event he could not regularly perform his specific occupation — dentist — if he became ill or he had suffered “injuries.” 

The issue in Nehra centered on what constitutes an “injury” in a disability insurance contract. The contract in Nehra states that the term “injuries” means “accidental bodily injuries occurring while your policy is in force.”  As contrasted with the term “sickness,” which under the contract “means sickness or disease which is first manifested while your policy is in force.” The contract did not define the term “accidental bodily injuries.” Nehra, 454 Mich. at 112.

In his application, the plaintiff listed “bilateral carpal tunnel syndrome” as being one of the causes of his disability along with “duodenal ulcer with hemorrhage.” His claim was approved, and he began collecting benefits. 

The decision suggests that Nehra had not realized that his disability contract made a distinction regarding the cause of his disability. Under the contract, if his disability were a “sickness,” his monthly benefits would end at age 65. If his disability stemmed from “injuries,” on the other hand, he could receive benefits over a lifetime. 

After collecting benefits for years, Nehra attempted to change the cause of his disability to “injury” from “sickness.” Nehra argued that his diagnosis of carpal tunnel syndrome was the result of a series of repetitive motion injuries that qualified him for the lifetime benefit under the “injuries” provision of his contract. The medical record on this point was seemingly underdeveloped.

Nehra’s claim was denied, and a lawsuit followed. The trial court dismissed his case, but the Michigan Court of Appeals reinstated it, finding there was an issue of fact as to the cause of Nehra’s disability. From there, the Supreme Court granted leave and reversed the Appeals Court reinstating the dismissal. 

The Supreme Court reasoned that the case was governed principally by two statutes that have nothing to do with disability insurance. 

First, the Supreme Court looked to the provisions of the Worker’s Disability Compensation Act to determine the meaning of the word “injury.”  The Court also looked to Michigan’s No-Fault Act to determine the meaning of an “injury.”  

The concept of a repetitive motion type injury was not supported by the Court’s reading of either statute. The Court found that an “injury” was a precipitating event that led to the claimant’s condition, not a pattern of micro-injuries over a sustained period of time.

Other courts have rejected this analysis. One federal court wrote that it had never heard of a “repetitive motion sickness.” Chapman v. Unum Life Ins. Co. of America, 555 F. Supp. 3d 713, 724 (D. Minn. 2021).

Nehra is not a particularly strong or persuasive decision, and upon closer examination, its underlying analysis is flawed. 

Both the Workers Compensation Act and the Michigan No-Fault Act are statutes that regulate mandatory insurance systems. The two statutes cited mandate that individuals and businesses purchase specific forms of insurance, and the cited laws create a uniformity among huge segments of the state’s population. 

A private disability contract is a contract that is voluntary and its purchase is discretionary. The terms that govern the contract are between the two contracting parties, and Michigan does not regulate the definitions that appear in a disability insurance contract. 

The Nehra case is an outlier and makes little sense in our modern, professional world. 

Here’s an example. Nehra is routinely cited to try to defeat the legitimate claims of surgeons who have suffered spinal injuries during the practice of their profession. Surgeons experience a significantly higher rate of spinal problems compared with the general population. 

By some estimates, nearly 75% of all surgeons suffer from back problems. Some surgical specialties have a rate of spinal injuries as high as 65% of the entire occupational category. And this is a growing trend. 

With the consolidation of medical practices, the specialization of surgical practices, and increased patient need, surgeons are seeing their caseloads increase. The more surgeons work, the greater the risk of injury to their own spines. 

Compounding matters, surgeons work in physical positions where their bodies are contorted for long periods of time; further, they are required to wear equipment necessary to perform surgery, including magnetic loupes and heavy, protective lead aprons. 

Collectively, this contributes to putting pressure on the neck and back and often results in spinal injuries over time. Undoubtedly, their medical conditions are caused by “injuries,” not illnesses.  

Nehra is a little known, rarely cited case; yet, it increasingly hangs out there as an impediment for legitimately disabled medical professionals within our state who entered into expensive disability contracts in the good faith understanding that their injuries (not just narrowly defined ones), would be covered. 

Nehra is not good law, comparatively speaking, and serves little purpose to continue. The Michigan Supreme Court should give it another look and consider overruling it. 


______________________

John Joseph (J.J.) Conway is an employee benefits and ERISA attorney and litigator and founder of J.J. Conway Law in Royal Oak.