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Deutsche Bank AB is saying it has no intention of paying the U.S. Justice Department’s demand of $14 billion to settle high-profile probes into its packaging of mortgages in the run-up to the financial crisis, reports MarketWatch.

The Justice Department’s investigations are connected with the bank’s issuance and underwriting of residential mortgage-backed securities between 2005 and 2007, writes reporter Sara Sjolin.

In a statement, the German bank said, “Deutsche Bank has no intent to settle these potential civil claims anywhere near the number cited. The negotiations are only just beginning. The bank expects that they will lead to an outcome similar to those of peer banks which have settled at materially lower amounts.”

“The bank expects that they will lead to an outcome similar to those of peer banks, which have settled at materially lower amounts,” it added, saying it has been asked to make a counterproposal.

The Justice Department has settled mortgage-related claims with Goldman Sachs Group Inc.  for $5.1 billion and J.P. Morgan Chase & Co. for $13 billion.

Read the article.

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Democrats on the House Judiciary Committee are asking the Justice Department to investigate the circumstances surrounding a $25,000 donation the Donald J. Trump Foundation made to Florida Attorney General Pam Bondi at a time when her office was considering whether to open a fraud investigation of Trump University, according to a Washington Post report.

The committee’s Democrats allege that the donation in 2013 “may have influenced Mrs. Bondi’s official decision not to participate in litigation against Mr. Trump,” and asks Attorney General Loretta E. Lynch to explore whether federal bribery or other laws might have been violated, report Matt Zapotosky and David A. Fahrenthold.

In a separate case, New York Attorney General Eric Schneiderman said on CNN Tuesday that his office was “concerned that the Trump Foundation may have engaged in some impropriety” and had “been looking into the Trump Foundation to make sure it’s complying with the laws that govern charities in New York.”

Read the article.

The Securities and Exchange Commission has filed civil fraud charges against the general counsel of Ohio-based chemical company RPM for allegedly mishandling the response to a U.S. Department of Justice investigation, Bloomberg Law reports.

Edward W. Moore, RPM general counsel and chief compliance officer oversaw the company’s response in 2011 when the DOJ started investigating whether its subsidiary, roofing materials company Tremco, had overcharged the government by millions of dollars on certain contracts,according to the SEC complaint.

The SEC accuses Moore of failing to disclose the investigation to RPM’s shareholders, along with his CEO, CFO and internal audit committee and auditors, in a timely manner, writes Gabe Friedman.

Read the article.

NAVEX Global will webcast a free webinar outlining updates to FLSA requirements, presented by Scott M. Nelson, a national labor and employment law authority from Baker & McKenzie, on Thursday, Sept. 22. The hour-long webinar will begin at 10 a.m. PDT (1 p.m. EDT).

New Fair Labor Standards Act (FLSA) regulations will go into effect on Dec. 2, updating the salary and compensation levels for exempt employees, impacting millions of salaried workers.

Wage and hour cases represent the most significant exposure to employers under workplace laws, NAVEX Global says on its website. This webinar will explain responsibilities and options for complying with the FLSA’s overtime provisions.

Register for the webinar.

The Treasury Department has released proposed regulations that seek to eliminate valuation discounts for interests in family-controlled entities, according to an Arnold & Porter article.

Authors Laura A. Jeltema, Thomas W. Richardson and Cara M. Koss write that the impact of these new rules is significant and far reaching, and if adopted in their current form, will drastically alter the landscape of wealth transfer planning for family business owners.

In the existing code, Internal Revenue Code Section 2704 was created to prevent families from using valuation discounts to artificially reduce the value of interests in family-controlled entities.

The IRS and Treasury now believe that Section 2704 “has been rendered ‘substantially ineffective’ by the recent trend of states providing restrictive default liquidation provisions. In response, one of the many changes contained in the Proposed Regulations narrows the exception to only those restrictions that are required to be imposed by federal or state law, and not merely those allowable as default provisions,” according to the article.

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It is undeniable that the Family Medical Leave Act (FMLA) has a legitimate purpose and many employees benefit from its protections, writes Melissa Dials, of counsel at the Cleveland office of Fisher Phillips for the Ohio State Bar Association. She points out, however, that there also are employees who abuse the law’s protections.

“This is particularly true of those who use intermittent FMLA leave when vacation or personal time is not available. Such abuse is disruptive to the work environment and can leave many managers frustrated. Fortunately, the FMLA regulations provide a number of tools that employers can utilize to curb FMLA leave abuse within the workplace,” she explains.

She discusses 10 pieces of advice: certify and recertify, ask for a second opinion, establish and enforce call-in procedures for all absences, require use of paid leave, count all absences related to the condition, require employees to schedule medical appointments around work schedule, consider temporarily transferring employees who take foreseeable intermittent leave, establish a policy prohibiting employees from working a second job while on leave, follow up on suspicious circumstances, and train front-line supervisors.

Read the article.

CNN Money poses a question that may be on the minds of people in the executive offices of Wells Fargo after more than 5,000 employees have been fired as a result of a scandal involving phony bank accounts: Do the CEO or other senior executives need to be fired, too?

The Los Angeles City Attorney and Consumer Financial Protection Bureau found that Wells Fargo employees had secretly set up new fake bank and credit card accounts in order to meet sales targets. That practice led to a fine of $185 million.

“CEO John Stumpf made $19.3 million in compensation in 2015,” reports Paul R. La Monica. “That makes him one of the top-paid bankers in the United States as he has been for years, along with these others: JPMorgan Chase’s Jamie Dimon, Bank of America’s Brian Moynihan and Lloyd Blankfein of Goldman Sachs. Stumpf, and his predecessor Dick Kovacevich, are well-known in banking circles for leading the bank’s efforts to cross-sell, or get customers to sign up for more and more accounts, with Wells Fargo.”

Read the article.

Managing third-party vendor relationships has recently become a hot topic for state and federal financial bank regulators, writes Jerry Blanchard of  Bryan Cave LLP.

Some examinations have resulted in regulators imposing settlements and impose civil money penalties on vendors, he reports.

He explains that, “The OCC guidance is generally looked at as the ‘gold standard’ for evaluating issues that need to be addressed in a vendor agreement. That does not mean that every contract a bank signs needs to have every one of those issues addressed or that each one needs to be resolved in favor of the bank. Vendor contracts come in many different shapes and sizes and may affect everything from back office processing, internet delivery systems, use of the ‘cloud’ to the people watering the plants at the branch. vendors will vary from small local operations to multi-national companies.”

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In orders issued just six days apart last month, the U.S. Securities and Exchange Commission (SEC) rejected language in severance agreements requiring employees to waive rights to receive additional monetary recovery, particularly awards for providing information to government enforcement agencies, reports Ogletree, Deakins, Nash, Smoak & Stewart.

“The Commission’s actions underscore its continuing scrutiny of any provisions that might impede the flow of information to the government, even where there is no evidence of any such effect. They also drive home that employers must continue to stay abreast of legal developments and modify their policies, practices, and agreements promptly.” write the authors, Margaret H. Campbell and Karen L. Vossler.

The advise employers to review and revise policies, practices, and employment agreements, including confidentiality, severance, separation and similar agreements. “In particular regarding recovery-limiting language, employers should consider carefully whether to use it at all, given that an enforceable waiver cuts off additional recovery from the employer,” they write.

Read the article.

Law Seminars International will hold the Fifth Seattle Comprehensive Two-Day Conference on Game Technology Law on Oct. 13-14, 2016. The conference will be at the Washington State Convention Center in Seattle and also will be broadcast via webcast.

The event is designed to benefit attorneys, business executives, and anyone else involved in the interactive entertainment industry. Information on the agenda, faculty bios, tuition, and CLE is available on the registration page.

On its website, Law Seminars International says participants will learn about:

~FTC regulatory update
~The current state of the industry for business models and financing sources
~New developments in the IP underpinnings for video games
~Tips for building a game as a brand
~Analysis of rights of publicity cases and clearance process tips
~Virtual/augmented reality opportunities and issues for the game industry
~Special privacy and data security issues for the game industry
~eSports and fantasy sports: the line between games of skill and gambling
~Virtual currency systems and related tax issues
~Tips for assembling a package that will be attractive to investors

Register or get more information.

NBC News is reporting tht Muslim-American groups are applauding President Barack Obama’s nomination of a Washington lawyer to serve in U.S. District Court — a move that could make him the first ever Muslim-American federal judge, according to advocates.

“If confirmed, Abid Riaz Qureshi would sit on the District of Columbia’s federal bench, the White House announced Tuesday,” according to the report by Chris Fuchs. “Qureshi, who graduated Harvard Law School in 1997, is a partner in the D.C. office of Latham & Watkins LLP, specializing in healthcare fraud, securities violations, and cases involving the False Claims Act, according to a White House statement.”

The report says that, while Muslim Americans have filled roles as state judges, none have served at the federal trial or appellate levels, according to Muslim Advocates, a national legal advocacy organization.

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For advisers helping clients plan for retirement, drafting a binding contract may now simply be a cost of doing business, reports Kenneth Corbin for FinancialPlanning.

“That contract, through which advisers must pledge to act as fiduciaries and make recommendations in the best interests of their clients, is at the heart of a new fiduciary regulation from the Department of Labor, which is aiming to mitigate the harm to investors from conflicted retirement advice,” he explains.

Advisers should learn how to incorporate the best-interest contract exemption into their practices if they help clients plan for retirement.

In his article, Corbin writes that there’s a streamlined version of the contract requirement in the DoL’s rule, which would ease the compliance burden for so-called level fee advisers, firms that receive fees that don’t vary based on the type of product or investment that they are recommending.

Read the article.

Elizabeth Holmes

Photo by Max Morse for TechCrunch

Fox Business is reporting that Theranos Inc. has withdrawn its request for emergency clearance of a Zika-virus blood test after federal regulators found that the company didn’t include proper patient safeguards in a study of the new test.

“The move is another setback for the Palo Alto, Calif., company as it tries to recover from crippling regulatory sanctions that followed revelations by The Wall Street Journal of shortcomings in Theranos’s technology and operations,” Fox Business reports. “Theranos has said it is appealing.”

Elizabeth Holmes, founder of the troubled company, recently announced development of a new blood-testing device that she said was designed for use outside a clinical laboratory and could run accurate tests from a few drops of blood.

Read the article.

Dozens of law professors banded together to assail a federal court’s recent decision striking down the Obama administration’s hydraulic fracturing rule, according to a report in E&E Publishing’s EnergyWire.

The report says 36 energy, public lands and environmental law experts filed a friend-of-the-court brief with the 10th Circuit, arguing that the U.S. District Court for the District of Wyoming got it wrong when it found fracking to be beyond the authority of the Interior Department and its Bureau of Land Management.

“The lower court’s decision has no basis in legal precedent or relevant statutes and violates basic canons of statutory interpretation,” the professors told the 10th U.S. Circuit Court of Appeals, which is reviewing the decision. “It reads a sweeping government-wide exclusion into a surgical amendment explicitly tied to one statute. As a result of this decision, the BLM cannot fulfill its statutory mandate to serve as the chief steward of our public lands.”

“In particular, the professors take issue with the lower court’s interpretation of the Safe Drinking Water Act, as amended by the Energy Policy Act of 2005,” writes E&E Publishing reporter Ellen M. Gilmer.

Read the article.

Pillsbury Winthrop Shaw Pittman has posted a client advisory reporting on some of the significant U.S. Supreme Court actions from January through June 2016 related to environmental and administrative law.

The Supreme Court decisions discussed in the advisory involve energy regulation, public lands/statutory interpretation, land regulation/tribal, rico/offenses committed abroad, clean water act/administrative procedure act finality, standing, agency interpretation/chevron deference, clean air act/epa clean power plan, mercury air toxics standard.

The court declined to hear two cases involving CWA/American Farm Bureau Federation, and Groundwater Contamination/Exxon Mobil.

The advisory also covers two cases of interest in the upcoming term, involving regulatory takings and  presidential appointments.

Read the article.

Fitch, Even, Tabin & Flannery LLP will present a free webinar, “European Patent Filing Strategies: Choosing the Appropriate Option,” presented by Rudy I. Kratz and Tony Wray. The webinar will take place on Tuesday, August 30, 2016, at 9 am PDT / 10 am MDT / 11 am CDT / 12 noon EDT.

A number of patent filing strategies are available in Europe. Patent applications may be filed at the European Patent Office (EPO) and at national patent offices such as the UK Intellectual Property Office (UKIPO) and the German Patent and Trade Mark Office (DPMA). Utility model applications are another form of intellectual property protection that can be pursued in certain countries. Each option has its advantages and disadvantages, and some approaches may be more appropriate in certain circumstances based on cost and other concerns. Recent developments may also have an impact on which filing strategy makes the most sense.

The webinar will address the following topics:
• Summary of filing considerations at the EPO, UKIPO, and DPMA
• Advantages and disadvantages of specific filing strategies
• Effect of the UK vote to leave the European Union and the status of the Unitary Patent

CLE credit has been approved for California and Illinois and is pending in Nebraska. Other states may also award CLE credit upon attendee request.

Following the live event, a recording of the webinar will be available to view for one year at fitcheven.com.

Register for the webinar.

HR Daily Advisor will present a complimentary webinar discussing what the overtime changes mandated by the U.S. Department of Labor FLSA mean for employers and recommend strategies for meeting these new challenges.

The event, sponsored by Kronos, will be Thursday, August 25, beginning at 2 p.m. EDT.

The overtime changes will extend overtime pay protections to more than four million American workers, HR Daily Advisor says on its website. The implications are enormous, affecting everything from job classifications and time tracking to compensation and compliance policies.

Register for the webinar.

The operator of 12 hospitals and more than 200 other treatment centers in Chicago and central Illinois has agreed to the largest settlement to date with the Office for Civil Rights for multiple potential violations of the Health Insurance Portability and Accountability Act, reports Kelly A. Leahy of Shumaker, Loop & Kendrick.

The agreement will cost Advocate Health Care Network $5.5 million and force Advocate to adopt a multi-year corrective action plan that stemmed from three incidents reported to OCR in 2013.  The breaches involved Advocate’s medical group subsidiary, Advocate Medical Group, which employs more than 1,000 physicians. The incidents that cost Advocate involved data breaches involving unencrypted devices and unauthorized access to a network.

In the article, Leahy offers some suggestions for what covered entities and business associates can do to prevent costly fines and burdensome settlements.

Read the article.

Regulatory agencies have grown into what some call a “fourth branch” of the federal government, writes Richard O. Faulk of Alexander Dubose Jefferson & Townsend LLP.

“The threat posed by this de facto branch, also known as the ‘Administrative State’ or, more colorfully, our ‘Junior Varsity Congress,’ has attracted the growing attention of a number of Supreme Court justices,” he writes in the Washington Legal Foundations’s Legal Pulse.

Critics of judicial deference in administrative law had hoped that the court might grant certiorari in cases that would allow them plot a new course, but the death of Justice Antonin Scalia caused those hopes to dim, Faulk writes.

“Since none of the Court’s decisions after Justice Scalia’s death demonstrate that a majority exists to abrogate deferential judicial review, the continuing expansion of federal regulatory power—or its curtailment—may decisively hinge on the outcome of the 2016 Presidential elections,” the article says.

Read the article.

The U.S. watchdog for consumer finances unveiled on Thursday a proposal to toughen regulation of the multibillion-dollar debt collection industry, with a focus on keeping agencies from pushing people to pay debts they do not owe, informing borrowers of their rights and cutting down on calls to debtors, according to a Reuters report.

Industry advocates expressed concerns about the costs of complying with the suggested requirements, which they warned could be passed on to borrowers or force some of the thousands of small collection firms to shutter. “Those pushing for consumer rights said the proposal left major holes in borrower protections and did not go far enough,” wrote Reuters’ Lisa Lambert.

She also reported that the proposal covers third-party collectors and debt-buyers. The CFPB will address first-party collectors and creditors, such as banks with their own collection departments, in the future.

Read the article.