Biglaw Firm to Pay $4.6 Million in Case Tied to Manafort and Ukraine

New York-based law firm Skadden, Arps, Slate, Meagher & Flom has agreed to pay $4.6 million to settle a Justice Department investigation into whether its work for a Russia-aligned Ukrainian government violated lobbying laws, reports The New York Times.

“As part of the settlement, the law firm agreed to register retroactively as a foreign agent for Ukraine in addition to paying the government $4.6 million, representing the money it earned from its work in Ukraine,” write the TimesKenneth P. Vogel and Matthew Goldstein.

The firm should have disclosed its lobbying activity for Ukraine under the Foreign Agents Registration Act, which covers both lobbying and public relations on behalf of foreign political interests, the Justice Department said.

Read the Times article.

 

 




DOJ Hiring Attorneys to Handle Property Seizures for Border Wall

Politico reports that the Justice Department placed an online job posting for a pair of attorneys to tackle border wall litigation in South Texas — a sign of coming property seizures and other legal controversies that President Donald Trump anticipates if he plows ahead with his signature project.

Politico’s Ted Hesson interviewed Chris Rickerd, the American Civil Liberties Union’s senior policy counsel on border and immigration issues, who said the attorneys likely will deal with eminent domain property seizures and quarrels with landowners over what their land is worth.

The two advertised jobs, based in McAllen and Brownsville, will pay between $53,062 and $138,790, according to a posting to a federal jobs website.

Read the Politico article.

 

 

 




Brexit Vote Prompts New Questions for UK, US Businesses

EU- BrexitThe historically large rejection of Prime Minister Theresa May’s Brexit proposal is creating new uncertainty for companies doing business in the United Kingdom.

“Questions about the terms of Brexit is already affecting currency exchange rates and the confidence of business leaders and long-range investment plans,” says Tony Magee, a former Chancery Barrister practicing in the U.K., and now a trial attorney in Dallas. “The risk for U.S. companies is that if Brexit happens without a clear long-term deal on customs rules and tariffs, that could inhibit trade with the U.K. and encourage U.S. companies to deal more with the European Union.”

Magee notes that while it is too early to predict the overall Brexit process and timing, the situation is very dynamic and volatile with the Prime Minister now required to come back to the House of Commons within three days to outline her “Plan B” proposal.

“It is possible that Brexit could be delayed by mutual consent and that the government could hold a second referendum to ask the electorate to vote on whether they still want to leave the E.U. But it is unlikely that a second referendum could be scheduled before the March 29 Brexit deadline. Publicly, May’s cabinet is not currently willing to hold a second referendum, but there are reports of differences of opinion in the cabinet on that score. Things could develop and change very quickly.”

 

 




Supreme Court Hands Rare Win for Workers in Arbitration Case

Neil Gorsuch

Justice Neil Gorsuch

The U.S. Supreme Court on Tuesday sided with a long-haul truck driver who sued his employer for failing to pay him a minimum wage, handing down a decision that could have broad ramifications on the transportation sector and the economy as a whole, reports CNBC.

CNBC reporter Tucker Higgins explains:

“In an opinion delivered for a unanimous court, Justice Neil Gorsuch held that courts must decide whether an exception in the Federal Arbitration Act, or FAA, for transportation workers applies before requiring arbitration. And, he wrote, that exception applies not just to traditional employees but also to independent contractors.”

The U.S. Chamber of Commerce had urged the court to rule in favor of the employer.

Read the CNBC article.

 

 




Autonomous Vehicle Survey Shows Desire for Consistent Regulation to Dispel Safety Concerns

Image by Norbert Aepli

The most critical driver for consumers’ adoption of autonomous vehicles, above technological advancement and adequate investment, is coherent national regulation amid consumer safety concerns. That’s according to a new survey of automotive and technology leaders and state and federal regulators by global law firm Perkins Coie LLP and the Association for Unmanned Vehicle Systems International (AUVSI), the world’s largest nonprofit organization devoted to advancing the unmanned systems and robotics community.

Survey participants indicated they saw a potential to increase convenience and reduce traffic incidents that stem from further development of autonomous vehicle technology. And while survey respondents are focused firmly on consumers’ perceptions regarding safety, no clear majority of respondents agree on which regulatory authority should be responsible for overseeing liability issues amid the current patchwork of federal, state and local rules.

“The emergence of any new technology requires adaptation of existing regulatory regimes,” said William G. Malley, office managing partner for Perkins Coie in Washington, D.C. “The same is true with automated vehicles. Regulators at every level will need to rethink and update existing requirements. In the long run, smart regulation can help to facilitate the development and deployment of this new technology by providing regulatory certainty and helping to reinforce the public’s confidence in the new technology.”

In a release, the firm discussed the survey:

Liability and Consumer Perception Top Challenges

Liability concerns ranked first among the challenges that industry leaders and regulators believe could impede the driverless-car market, just slightly ahead of consumers’ safety perceptions. Respondents also see an urgent need for infrastructure, such as smart signs, traffic lights and merge lanes, to make roads shared by fully autonomous, semi-autonomous and traditional cars safe for everyone.

“You don’t see liability issues go through the courts until you have already had an accident,” said Daniel P. Ridlon, Co-Chair of Perkins Coie’s Unmanned Vehicle Systems Industry group. “Participants in our survey from across the spectrum of industry and regulatory insiders understand this, telling us in a variety of ways that safety and product liability risk are principally important and closely related. They also recognize how both issues can affect consumer sentiment, impacting the industry well beyond the immediate costs related to lawsuits.”

Investment Opportunities Abound

With the market for driverless cars projected to grow to as large as $7 trillion by 2050, respondents see multiple investment opportunities as equally attractive and urgent. Vehicle-to-vehicle and vehicle-to-infrastructure communication technology, 5G technology and Advanced Driver Assistance Systems were seen as the most enticing investments, followed closely by precision mapping and location technology.

“This survey shows a young industry with tremendous potential and understandable growing pains as technology shapes the future of transportation,” said Brian Wynne, President and CEO of AUVSI. “Lawmakers, consumers and regulators alike should embrace the advantages of the future AV era as we work to resolve early-cycle challenges in the years ahead.

Other Key Survey Findings

• A majority – 54 percent – of industry respondents said they would rather see regulation come from the federal level. This reflects the difficulty automakers anticipate in achieving widespread adoption of AVs without a broad and coherent regulatory framework.
• All survey respondents – technology and automotive executives as well as regulators – saw the possibility of reducing vehicle accidents as the most important benefit of AVs. More survey respondents selected reduced traffic accidents as the greatest benefit to consumers than all other options combined.
• Respondents believe the price of investment, behind safety concerns, is one of the top obstacles to the growth of the AV industry with those in technology fields considering investment costs the most worrisome obstacle.

See the complete survey report.

 

 




Border Wall Needs Private Property. But Some Texans Won’t Give Up Their Land Without a Fight.

Government lawyers have taken the first step in trying to seize private property using the power of eminent domain to build a border wall — a contentious step that could put a lengthy legal wrinkle into President Trump’s plans to build hundreds of miles of wall, reports The Washington Post.

Previous eminent domain attempts along the Texas border have led to more than a decade of court battles, some of which date to George W. Bush’s administration and have yet to be resolved, according to the Post‘s Katie Zezima and Mark Berman. Many landowners are vowing to fight anew.

The reporters quoted Gerald S. Dickinson, an assistant professor of law at the University of Pittsburgh, who said this newest fight will be different because the earlier effort mostly included federal government land.

“If it’s going to be a contiguous wall across the entire southwest border, you’re talking about a massive land seizure of private property,” he said.

Read the Post article.

 

 




Can You Be Forced to Sign This Contract Modification?

A new U.S. Postal Service change to the standard terms and conditions that apply to its newly awarded Highway Contract Route (HCR) and Contract Delivery Service (CDS) contracts could be unenforceable, according to David P. Hendel, writing in the Husch Blackwell Contractor’s Perspective blog.

The changes apply to existing CDS contracts as well as newly awarded ones. In an email, the Postal Service asked contractors to sign, without any “alterations or additions,” a contract modification that incorporated the new terms. If the contractor did not so, the Postal Service’s email threatened contract termination, Hendel writes.

He cited problems with the way the changes are presented, including lack of consideration, violation of the implied covenant of good faith and fair dealing, and the legal theory of coercion and duress.

Read the article.

 

 

 




Judge Rebukes DOJ, Says U.S. ‘Laughable’ for Using Shutdown to Delay Suit

A U.S. judge overseeing a veteran’s multimillion-dollar negligence lawsuit in Puerto Rico rebuked the Justice Department for attempting to use the partial government shutdown to put the case on hold, calling the request “laughable,” according to a Bloomberg Law report.

Bloomberg’s Erik Larson writes: “In a ruling denying the government’s bid for more time, U.S. District Judge William G. Young said lapses in federal appropriations, like the current one triggered by President Donald Trump’s demand for funding for a border wall with Mexico, aren’t a government ‘policy’ that could theoretically justify staying such a lawsuit.”

The judge decried “an abdication by the president and the Congress” of the duty to govern responsibly.

Read the Bloomberg Law report.

 

 

 




General Counsel Named in Corruption Probe Subpoenas Resigns

Cleveland.com reports that Emily McNeeley, general counsel for Cuyahoga County’s troubled IT Department and one of several people named in subpoenas related to an ongoing corruption investigation, has resigned from her $95,000-a-year job,

The county reported the resignation Tuesday, according to Cleveland.com’s Courtney Astolfi.

McNeeley was placed on unpaid leave in April after corruption investigators repeatedly named her, and her boss, IT Director Scot Rourke, in subpoenas served on the county. The cases refer to potential conflicts of interest, the report says.

Read the Cleveland.com article.

 

 




Federal Courts Run Out of Cash Next Friday. Here’s What Happens Then

Bloomberg Law reports that companies that turn to the federal courts to resolve fights with rivals and customers may find themselves in limbo if the government shutdown continues beyond next week.

The system can spend money left over from fees and other sources to run through Jan. 11, writes Bloomberg’s Erik Larson.

“After that, nonessential workers at the 94 federal district courts, and at higher courts across the country, may have to stay home even as skeleton crews show up—without pay—to handle matters deemed essential under U.S. law, including many criminal cases,” Larson explains.

Individual courts and judges then will decide how to fulfill those critical functions.

Read the Bloomberg Law article.

 

 




In 8-Month Tenure, Non-Elected NY AG Was Leading Trump Antagonist

Barbara Underwood was an apolitical force in New York, quietly serving as solicitor general before getting an unexpected promotion to become the state’s first female attorney general, writes the Associated Press.

In her eight months in the AG’s role, she sued to put President Donald Trump’s charitable foundation out of business, accusing him of running it as a wing of his private businesses and political campaign. She also used the courts to challenge his administration on a multitude of policy fronts, including opposing its push to add a citizenship question to the 2020 census.

Underwood was appointed attorney general by the state legislature in May after the surprise resignation of Eric Schneiderman, explains AP’s Michael R. Sisak.

Now she’s going back to the solicitor general’s office, but Trump still faces challenges from New York, from the new AG, Letitia James.

Read the AP article.

 

 




Lawyer Accuses Judge of ‘Robe Rage,’ Tells Opposing Counsel to ‘Certify Your Own Stupidity’

The ABA Journal reports on a Chicago lawyer who has been accused of belittling his opposing counsel during a deposition and then describing the judge’s reaction to his conduct as “robe rage.”

Charles Andrew Cohn was accused in a complaint before the hearing board of the Illinois attorney disciplinary commission.

During a deposition, the complaint says, Cohn instructed his client not to answer a question, spurring the opposing lawyer to note her disagreement. “Certify the question,” said the opposing lawyer.

“OK,” Cohn replied. “Then certify your own stupidity.”

Cohn doubled-down when he filed a response to the opposing lawyer’s motion to compel. He wrote that — in a hearing on the motion — the judge had himself flown into a rage in the court hearing, describing the situation as a “robe rage incident.”

Read the ABA Journal‘s article.

 

 

 




Judge Who Tossed Obamacare Has Had More Than His Share of Contentious, High-Profile Cases

Given U.S. District Judge Reed O’Connor’s previous decisions halting Obama administration policies, few legal observers were surprised when the conservative judge issued a ruling that declared the Affordable Care Act unconstitutional because of a recent change in federal tax law, reports The Dallas Morning News.

Reporter Kevin Krause quotes Josh Blackman, a law professor at South Texas College of Law in Houston: “Without question, Judge O’Connor has had a fairly high-profile docket, in that he gets a lot of these hot-button issues.”

The Texas attorney general has filed such cases in the Fort Worth and Wichita divisions of the Northern District of Texas because Paxton knows “with a high degree of certainty” they will wind up in O’Connor’s court, Blackman said.

“He has become a go-to judge for Republicans over certain heated national social issues such as health care and transgender rights,” Krause writes.

Read the Morning News article.

 

 




Implementing the New Revenue Recognition Standard – What Private Companies Need to Do Now

By Robert Miller, CPA, CFE
Samet & Company, PC

With the effective date for the new revenue standard fast approaching, many private companies have still not taken important steps towards implementation. Time is running out as the private company implementation date draws closer and some entities may be surprised to learn that the effort to implement the new model is more involved than they might have imagined.

In May 2014 the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers, codified as Accounting Standards Codification (ASC) 606. This sweeping new revenue standard changes the entire model for recognizing revenues from arrangements with customers, introducing a new five-step model. The effective date for non-public entities is any fiscal year beginning after December 15, 2018.

Companies must consider and resolve important questions: What systems are in place to capture the new accounting, reporting and disclosure requirements? Are there customer arrangements that have a variable consideration component? Which of the two acceptable methods for calculating transaction price will be most appropriate? How will assessments be made to determine whether to recognize performance obligations at a point in time versus over time? What adoption method will be most appropriate? These are just some of the questions that must be considered by all entities as they implement the new revenue standard.

Auditors are also paying close attention to the implementation of ASC 606, and will themselves be focused on designing procedures to properly test the elements within the new revenue recognition model, in addition to implementation of the standard by their audit clients.

Companies will find that it is generally beneficial to have a preliminary discussion with their auditor regarding the approach in the first year of implementation and beyond. This will almost certainly eliminate certain potential surprises later on. Items that should be discussed include:

• The approach for documenting implementation of ASC 606, including the new five-step model
• The accuracy of any data used, and the approach for compiling that data to support first year reported amounts and disclosures
• The controls and process for ensuring that revenues are being properly captured and recognized under the new model
• Any assumptions by management and the supporting evidence or reasoning behind those assumptions
• Important management representations that are likely to be required

All entities within the scope of ASC 606 will need to develop a plan for implementation and document how they are applying the new standard, regardless of the level of impact. At a minimum, there are expanded disclosure requirements for all entities. Additionally, many entities that have already adopted ASC 606 found that changes to existing systems were necessary in many cases. An initial assessment of the impact of the new standard is critical to gain an understanding of what might be involved to implement.

So what should private companies who have not yet taken action do? Here are some important steps to follow:
• Designate a Champion – Identify and assign an individual to lead the implementation project
• Develop an Implementation Plan – A solid implementation plan should cover several areas, including technical accounting impact, processes and internal controls, IT and data needs, and training, among other areas
• Document – Document the application of the standard to specific types of customer contracts
• Make Changes to Systems – Implement any necessary system changes to ensure information necessary for proper reporting is captured and tracked
• Capture Information Necessary for Implementation – Complete any analyses and calculations needed to properly support amounts and disclosures on the date of adoption

An important first step is to contact your accounting firm. Your audit partner is often management’s best resource. An initial discussion about how the new ASC 606 model is likely to affect your business can be worth its weight in gold. While the clock continues to tick for many companies that have not yet begun the process of evaluating the impact of ASC 606, there is still time to avoid unwanted surprises. The key is to take that first step and reach out to your accounting firm or other advisor who has a solid understanding of the new standard and start the discussion about implementation.

Robert S. Miller, CPA, CFE, partner, Samet & Company, PC, Robertm@samet-cpa.com, 617-751-5395, www.sametcpa.com

 

 




Court Warns: Disbarment for Anonymous Online Posts is Lesson for Other Lawyers

A former federal prosecutor has been disbarred for posting anonymous online comments about cases being handled by himself or by his office, according to reports from the ABA Journal and the Legal Profession Blog.

The Louisiana Supreme Court ordered the disbarment of Sal Perricone, finding he had violated ethics rules because his “caustic, extrajudicial comments about pending cases strikes at the heart of the neutral “dispassionate control which is the foundation of our system.”

“Perricone had posted more than 2,600 comments on nola.com, the website of the New Orleans Times-Picayune, between November 2007 and March 2012. Between 100 and 200 comments related to matters being prosecuted by Perricone’s office,” according to Journal reporter Debra Cassens Weiss.

Read the ABA Journal article.

 

 




Supreme Court Suggests Forcing Lawyers to Pay Bar Association Dues Violates Their Free Speech

The U.S. Supreme Court may be on verge of upsetting the longstanding system of states requiring lawyers to pay dues to bar associations, reports the Los Angeles Times.

At least 30 states require the dues, in most cases with bar associations regulating the legal profession by licensing lawyers and disciplining those who violate the rules. Lawyers in turn are required to pay dues to cover the cost, explains the TimesDavid G. Savage.

Savage writes:

“In a brief order on Monday, the court overturned a ruling last year by the U.S. 8th Circuit Court of Appeals that had upheld mandatory bar dues in North Dakota and sent the case back “for further consideration in light of Janus.”

In Janus v. AFSCME, the court last June struck down state laws in California and elsewhere that required teachers and other public employees to pay fees to support a union.

Read the LA Times article.

 

 




Subpoenas Issued to Trump Organization in Emoluments Lawsuit

The attorneys general of Maryland and the District of Columbia on Tuesday formally demanded financial records from U.S. President Donald Trump’s businesses as part of their lawsuit alleging his dealings with foreign governments violate anti-corruption clauses of the U.S. Constitution, reports Reuters.

The Trump Organization Inc., the president’s privately owned real estate company, and related corporate entities received the subpoenas, according to Reuters reporter Jan Wolfe.

The report quotes George Brown, a professor at Boston College Law School:

The development “brings us closer to judicially enforced discovery about the Trump empire,” said Brown. “It will probably tell us a lot we don’t know because nobody is going to hide that stuff in the face of a subpoena.”

Read the Reuters article.

 

 




Download: Best Practices For Conducting Fast, Defensible Internal Investigations

Zapproved has published a new guide that outlines the five best practices for conducting fast, defensible internal investigations.

The guide can be downloaded from Zapproved website at no charge.

An internal investigation is exactly what it sounds like: an inquiry into an organization’s internal operations, Zapproved says on its website. Internal investigations frequently involve allegations of wrongdoing, such as embezzlement, sexual harassment, discrimination, or wrongful termination. However, an internal investigation may also be conducted in response to a regulatory compliance concern initiated by agencies like the U.S. Securities and Exchange Commission (SEC) or as part of a due diligence process before a merger or acquisition.

The goal of an internal investigation is to either detect and respond to wrongdoing or dispel suspicions. Organizations should respond to investigations in a way that curtails any specific incident of wrongdoing and discourages similar future violations. The overarching goal is to create an open, productive work environment that is neither distracting nor discriminatory.

Download the guide.

 

 




Guidelines for GDPR Compliance in Third-Party Contracts

General Data Protection Regulation requirements might look like a new bureaucratic threshold for doing business in the European Union. But sooner or later, a strict regulation in this area is likely to occur in every country, points out Vladislav Nekrutenko in an article for IoT Evolution.

The acceptance of the California Consumer Privacy Act 2018 and the Brazil Personal Data Protection Law are good examples in this regard, he explains.

His article details some steps that can help a company fulfill its obligations in contracts with third parties and mitigate risks regarding third parties’ data misuse.

Read the article.

 

 

 




Newspaper Report Foils Trump Labor Secretary’s Chances of Being the New AG

Labor Secretary Alexander Acosta is out of the running to be President Donald Trump’s attorney general following a Miami Herald report that he oversaw a sweetheart deal for a wealthy financier accused of sexually abusing dozens of underage girls, according to two people close to the president.

Acosta was a federal prosecutor in Florida before going to Washington, the two advisers said.

Herald report Anita Kumar explains:

The investigation, which reported that Acosta, then U.S. attorney, cut a secret deal to allow billionaire Jeffrey Epstein to serve only 13 months in a county jail, is “clearly something” that is being widely circulated among Trump aides, one of the people said. The agreement “essentially shut down an ongoing FBI probe” and granted immunity to “any potential co-conspirators,” according to the story.

Read the Miami Herald article.