SEC Sued Over New Corporate Proxy Rules

September 30

A suit has been filed against the SEC in regards to new rules passed imposing regulations on American companies. The SEC adopted rules on August 25^th requiring companies to include in their proxy materials the nominees of “significant, long-term shareholders.” The rules are designed to allow shareholders to exercise their traditional rights to nominate and elect members of company boards of directors. However, a suit was filed Wednesday by the U.S. Chamber of Commerce and the Business Roundtable against these rules, claiming a violation of the Investment Company Act, the Securities Exchange Act, the Administrative Procedure Act as well as various issuers’ rights under the fifth and first amendments. The allegations are that the SEC did not consider the costs these rules will impose on companies, and by extension shareholders and workers. Also, they claim that they will lead to costly election contests, and the SEC is guilty of “arbitrary and capricious” treatment of state law.

To learn more about the SEC watch our course by Ernest Badway "Transparency at the SEC: A Response to the Current Financial Crisis"

To read the full article, click here

Could you correctly answer all of the 100 possible civic questions posed to applicants for U.S. Citizenship, or even 10 of them?  To find out, watch Lawline.com’s newest immigration CLE program in which Kristen Wagner interviews immigration attorney Jessica Rhodes-Knowlton on the naturalization process.  Rhodes-Knowlton teaches viewers everything they need to know in order to qualify for U.S. citizenship, including tips on how individuals can successfully complete each step of the process. 

Additionally, for further insight into becoming a U.S. citizen, read Ariel Kaminer’s New York Times article Becoming a Citizen the Naturalized Way in which Ms. Kaminer writes about her journey (for journalistic purposes only) through the citizenship process from interviewing with the immigration officer and taking the exam to the emotional swearing in.  These two sources will teach you nearly everything you have always wanted to know about becoming a U.S. citizen and more.

Demand for Legal Jobs Falls Flat

According to a new study at Hildebrandt Baker Robbins, conducted by Lisa Smith, the future of many legal jobs may be in peril. Smith, who is the head of the consultancy firms strategy and structure practice group, concluded in her analysis that due to many trends in outsourcing and flat demands for legal services, there will be a fundamental adjustment in how firms hire and compensate non-partner employees. Smith’s claim has been chided as inaccurate in legal blogs, including some who think that the study is an attempt to pander to what Biglaw partners want to hear.  Smith says this is not her intent, but is a fact based on the current general economic trend taking place broadly across industries. She says that with less economic activity clients won’t need as much legal work. Therefore, firms will become much more sensitive to the price of litigation and other work.

To learn more about employment law watch our course by Denise Hasbrook, "Vital Considerations in Todays Employment Decisions"

To read the full article, click here

Spy Swap Forced Prosecutors Into Balancing Act

This article from the New York Times discusses the ethics behind the “Russian Spy” incident that exploded over the summer. What should’ve been a criminal case became “a deal orchestrated by politicians”, where American and Russian governments agreed to end the criminal prosecution of the 10 accused Russian spies and engage in a spy exchange instead. The article examines the ethical dilemma the prosecutors were faced with in deciding whether dropping the case and acquiescing to a trade was the right thing to do. Many others involved in the case question whether the lawyers (both defense and prosecution) weren’t merely pawns  and the trial was merely a political maneuver operating outside the justice system.  In the end, Mr. Bharara, the US Federal Prosecutor in charge of the case, said that after studying historical precedent of spy trades, he concluded that the deal being brokered by the politicians was acceptable and that in the modern world justice has to be consistent with national security.

for full article click here

to learn more about the Federal criminal law take a look at this course taught by Rocco C. Cipparone, Jr.:

Handling Federal Criminal Cases

Labor Dispute Grows Out of Social Media

As the growth of social media continues to transform how we communicate and interact, there are increasing legal difficulties determining acceptable practices in the workplace. In 2009 the Division of Advice addressed a potential case regarding a Sears’s policy banning disparaging comments about the executive leadership, employees or the corporate strategy. The board decided that this was not a violation of Section 7 of the Labor Relations Act. They said that while the ban, if thought about in isolation might hinder workers’ rights, it is given in enough context that it is not a violation of the Act. However, the future is unclear because the composition of the Labor Relations Board has since changed and the new members are likely to take a different stance. So employers must be careful in the policies they implement until the Board to outline the rules after a new case is brought to them regarding social media.

To learn more about Social Media, watch the course here

To learn more about the National Labor Relations Board, watch the course here

To read the Full Story, click here

In this interesting article, journalist Tara Bernard tested 4 will-generating software programs, and then had them reviewed by a lawyer.  Although she found the programs easy to use and the generated wills were all legally sound, the journalist found that she still needed a lawyer to help her decode some seemingly standard clauses and their consequences in her home state (New York). Additionally, there was surprising variation between the wills depending on the program used. The main problem in using these programs to create wills is that people don’t know the finer points of drafting a will, and so if their financial situation is atypical they might leave out an important component. Furthermore, because most people aren’t familiar with the process of drafting a will, they might misunderstand some of the program’s instructions (which, according to the journalist, are not 100% clear), and they might actually render their will invalid (for example, by failing to properly conduct the will-signing ceremony). This would, ironically, lead them to seek legal advice about their will from a lawyer, which is what the software supposedly renders unnecessary. Obviously, there is still no good substitute for a legal professional who knows the ins-and-outs of the process.

for the full article click here

to brush up on the basics of wills and trusts take a look at our CLE course: The Basics of Wills and Trusts in New York

Judge to Approve $75 million Citi Settlement
September 27th

• Federal District Judge Ellen Segal Huvelle said Friday she would approve of a $75 million settlement between Citi bank and the SEC.
• The case currently in progress between the SEC and Citi is over misstatements relating to the exposure of roughly $40 billion in subprime mortgage securities.
• The misstatements by Citi were made in the fall of 2008.
• The settlement has received wide criticism, as many see it punishing already victimized shareholders.
• Citi and the SEC both hold, however, that although the company had poor disclosure procedures, they did not have the intention of deliberately misleading shareholders.

Find out more about the history and role of the SEC, watch the course here

Find out more about maintaining corporate record books and disclosure practices, watch the course here

Find the full article here

Virtual Crimes – Real Damages

Challenges Posed By Electronic Crimes In The United States

By: Fernando M. Pinguelo and Bradford W. Muller

A dangerous aspect of the Internet Age that businesses and governments must cope with is cybercrime.  As technology advances, so do criminals.  For American businesses, and both federal and state governments, the potential cost of these attacks is staggering. 

“Electronic Crime” or “Cybercrime,” broad terms used to describe criminal activity conducted through the Internet, began almost as soon as the Internet came into being.  The complexities of the schemes have proven dynamic, evolving to meet the increased security measures employed by both business and government.  Today, attacks on businesses can include such things as the theft of intellectual property, seizing bank accounts, generating and distributing malware, and other forms of disruptive cybercrimes.  Cyber attacks against the federal government can have an even greater negative impact, potentially devastating the country’s technical infrastructure or leading to the exposure of highly classified information.  In 2009, the Director of National Intelligence, testifying before the Senate Select Committee on Intelligence, explained that foreign nations and cybercriminals were targeting both the government and private sector in an effort to gain competitive advantages, or to disrupt or destroy them. 

Perhaps most disturbing is that terrorist groups have signaled a desire to use cyber attacks against the United States government.  And for state governments, the concern is just as great.  While the weak American economy has caused most states to severely trim their budgets, reducing their ability to devote expenditures to cyber defense, they remain an appealing target for cybercriminals, as their computer systems hold some of their citizens’ most vital records, including health and driving records, educational and criminal records, professional licenses, and tax information.  Now more than ever, governments and businesses must be aware of this evolving threat, and take proactive measures to counter it.

This post is based on a full article that will be presented at the Second Congress on Electronic Crimes and Forms of Protection, September 28, 2010 in São Paulo, Brazil. In the full article, the authors endeavor to explain:

• What cybercrimes are
• Profile the cybercriminal
• Provide discussion of some of the most common forms of cybercrimes affecting businesses and government
• Discuss action that the government is taking to fight back

For the complete article, click here.
 

Fernando M. Pinguelo is a partner at Norris McLaughlin & Marcus where he specializes in E-discovery and litigation. Pinguelo is a frequent lecturer on the topic of cybercrime and will speak at Fecomercio's Second Congress on Electronic Crimes and Forms of Protection, which will be held September 27 and 28 2010, in  São Paulo, Brazil.

For more on this topic and on Fernando Pinguelo, click here.

Lawline.com faculty member Scott Michelman has been featured on CNN.com ("ACLU sues Wal-Mart for firing employee using medical marijuana") and the NYTimes.com ("Medical Use of Marijuana Costs Some a Job"), regarding his representation of cancer patient Joseph Casias in a wrongful termination case.  ACLU attorney Michelman asserts that a Michigan Walmart store wrongfully terminated Casias for testing positive for marijuana use even though he was legally registered with the state to use the drug and did not use marijuana at work or come to work under the influence.  According to Michelman, "No patient should be forced to choose between adequate pain relief and gainful employment, and no employer should be allowed to intrude upon private medical choices made by employees in consultation with their doctors." In response, Walmart contends that regardless of the employee's reason for taking the drug, the company must terminate employees who test positive for drug use because of customer safety issues.  While fourteen states currently provide protections from prosecution for patients who use marijuana as recommended by a doctor, the extent to which many of these laws protect patients from adverse employment actions is unsettled.    Michelman and the ACLU are arguing that Michigan's medical marijuana law, which is more expansive in its language than most states' laws, includes such protections and therefore prohibited the firing of Mr. Casias for medical marijuana use in accordance with state law. 

To learn more about civil rights litigation in general, watch Lawline.com’s new course by Scott Michelman, The Basics of Civil Rights Litigation.  In this program, Michelman draws on his years of experience in this practice area to provide helpful tips on how to successfully handle civil rights cases.  In particular, Michelman shares his insights on selecting good plaintiffs and proper defendants.  Lawline.com will continue to follow the litigation in Casias’ suit against Walmart, and will update the Legal Beat with developments.  In the meantime, all attorneys can benefit from Scott Michelman’s civil rights litigation wisdom by watching his exemplary program on this subject matter. A short preview of the program is available below.

Dell Decides to Walk

Hewlett-Packard recently purchased 3Par, a computer storage system company, for $33 per share ($2.3 billion).  Dell had engaged in an 18-day bidding war with H.P. but in the end decided not to counter H.P.’s winning offer.  What can we learn from this?

Evaluating your and your counterpart’s Plan Bs (what will happen to both sides if you don’t do a deal with your counterpart) is a critical step in preparing for a negotiation.  Why?

Because it tells you when to walk.  If your best alternative to that deal is better than the deal on the table, don’t take the deal on the table.  Knowing your best Plan B is better than your counterpart’s last move prevents you from making an agreement you should reject.

And if the deal on the table is better than your best alternative (your best Plan B), take the deal.  Knowing your best Plan B is worse than your counterpart’s last best offer tells you to sign the deal.

Here, we can assume Dell evaluated its Plan B - not purchasing 3Par at the price required - and decided that walking away and not bidding any more was its best course of action.

Marty Latz is the founder of Latz Negotiation Institute, a national negotiation training and consulting company, and ExpertNegotiator, a Web-based software company that helps managers and negotiators more effectively negotiate and implement best practices based on the experts' proven research.  He is also the author of Gain the Edge! Negotiating to Get What You Want (St. Martin’s Press 2004). He can be reached at 480-951-3222 or Latz@ExpertNegotiator.com.
 

Fernando M. Pinguelo, a Lawline faculty member, recently sat down with cyber law expert Renato Opice Blum to discuss some of the most pressing issues facing his international clients with regard to cybercrimes and he shared with us some useful ways to address the growing proliferation of these tech crimes.

Renato chairs an international summit this month in São Paulo, Brazil sponsored by Fecomercio, a premier Brazilian business organization that represents over 600,000 companies in the trade, commerce, and tourism and hospitality sectors.  The summit will gather the world’s experts to address issues related to cyber crimes and security.

Q: Thank you, Renato, for sitting down with me to discuss the latest developments in tech crimes and what experts like you are doing to help businesses and individuals prevent these crimes and address them when they hit home.  Tell me a little bit about your background and the composition of your law practice.

A: My name is Renato Opice Blum and I am a Brazilian Attorney and Economist who specializes in High Tech Law. I am CEO of Opice Blum Attorneys at Law, one of the most respected South American firms.  Opice Blum Attorneys at Law has many years of solid experience in the main areas of law, and is recognized as a pioneer for its work in law as it relates to technology, electronic and digital law, information technology, computer law, and their variations.  We handle mediations, arbitrations, oral sustaining in Court, crisis management, cybercrimes, and corporate matters. Opice Blum Attorneys at Law handles matters throughout the Brazilian territories and maintains close relationships with international legal correspondents in main financial centers, such as in New York and Miami. More detailed information can be found on the Opice Blum website.

Click here to read more!

Amy Goldsmith, one of our most prolific speakers and senior attorney at Gottlieb, Rackman & Reisman, presents a fascinating summary of a recent supreme court case involving medical patents on genetics (Association for Molecular Pathology, et. al. v. U.S. Patent and Trademark Office.) Amy Goldsmith has represented clients, both nationally and internationally, in a variety of industries, including telecommunications and consumer and designer goods. She is a frequent lecturer on intellectual property and has a specialized background in issues relating to genetics.

By analyzing the central arguments of the case, Ms. Goldsmith highlights moral issues that are raised as well as future implications relating to genetics and patents.

As the NFL preseason comes to a close, a number of high-profile players are still holding out, some claiming a willingness to skip the season if they don’t get what they want.

Why would a player hold out?  To strengthen their leverage.  The player wants to emphasize the unattractiveness of the team’s Plan B – going through the season without that player on the field.  If the player is good enough to impact the team’s actual likelihood of success, this can be quite effective. 

However, it comes with risk.  By missing practice and pre-season games, it’s likely the player will be less mentally and physically prepared for the season (the Brett Favre situation notwithstanding).  This is a particularly significant problem with new players.  Plus, if games are missed, the player potentially loses some or all of his current or potential salary and may be viewed as a selfish player who puts his own self-interest ahead of the team (which of course he is doing). 

Further, it gives competing players a chance to demonstrate their skills.  Finally, given the short length of the typical NFL career, missing an entire season can disrupt a player’s career momentum and may be a lost opportunity that can never be regained.

As Kalani Simpson pointed out on FoxSports.com today, “The key to holding out seems to be the length of it.  Long enough for them to know they’d miss you. Enough time left for you to make a difference when you get back, so the season isn’t lost.” 

From a negotiation perspective, if a player wants to risk it at all, this sounds like good advice.
 

Marty Latz is the founder of Latz Negotiation Institute, a national negotiation training and consulting company, and ExpertNegotiator, a Web-based software company that helps managers and negotiators more effectively negotiate and implement best practices based on the experts' proven research.  He is also the author of Gain the Edge! Negotiating to Get What You Want (St. Martin’s Press 2004). He can be reached at 480-951-3222 or Latz@ExpertNegotiator.com.

 

Here is a great  new course, presented by Michael Raff, about New Jersey automobile insurance law. Michael Raff is an experienced litigation attorney at Raff & Raff LLP in New Jersey.

In this course, Mr. Raff provides a detailed outline of the different types of insurance policies in New Jersey and examines auto accident claims under the state's no-fault law. He outfits New Jersey practitioners with the tools they need to make sure their clients are adequately protected in the case of a motor vehicle accident.

In this preview of the lecture, New Jersey's status as a "no-fault" state is introduced, and the reasons behind this are discussed.