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Friday News Roundup: Managing Shutdowns, Brexit, and Patent Suits

A s 2019 gets underway, two things are certain: Brexit is coming, the US federal government shutdown will continue, and the drudgery of patent suits persist. The challenge for GCs is to grapple with, and manage, all of these on top of their busy schedule.

1. No end to US shutdown in sight — federal courts may close in February

The US federal government remains shut, with no signs of reopening soon. The federal courts, with an annual budget of US$8 billion, should have the funds to remain open until the end of January, according to the New York Times. Some federal courts are postponing civil cases in which the Justice Department is a party while the shutdown continues.

The Securities and Exchange Commission (SEC) has a small number of staffers, working without pay, in the Division of Corporation Finance. They are available to answer questions relating to fee calculations for corporate filings and other securities law matters. However, during the shutdown, the staff is not allowed to check individual e-mail accounts.

Submit any requests and your contact information to [email protected]. Throughout the shutdown, the SEC’s EDGAR (Electronic Data Gathering, Analysis, and Retrieval) database will continue to accept registration statements, offering statements and other filings. Yet the shutdown prevents them from declaring registration statements effective. Further details are available online.

2. At least the UK government is open

As UK Prime Minister Theresa May’s government tries to find a compromise Brexit deal after surviving a non-confidence vote on January 16, 2019, a no-deal, or “hard,” Brexit looms. In that case, general counsel should expect longer customs checks and potentially heavier tariffs on goods that now move across the English Channel tax-free.

Many companies have spent millions locking in extra parts and storage space ahead of time. They are also putting alternative supply lines in place, in case there is confusion at UK and EU ports.

One in 10 corporate counsel had yet to draw up plans for Brexit, found Andrew Gray, the global head of Brexit for financial services at PricewaterhouseCoopers, last year.

3. And you’re the boss now

In the wake of the British Parliament’s rejection of May’s proposed plan to withdraw from the European Union, general counsel must be prepared for a “range of scenarios,” says TheLawyer.com. Many companies will expect their general counsel to take a leading role, according to a survey the site conducted.

Counsel should, at a minimum, be prepared to confront five areas of risk: on customs duties and tariffs, supply chain disruptions, labor issues, restrictions and changes affecting transfers of customer data, and risk exposure in contracts.  

4. Apple wins in German court

A regional German court in Mannheim threw out a patent lawsuit against Apple Inc., filed by Qualcomm Inc. The court, in a verbal decision, dismissed the suit as without merit, saying the patent at issue was not violated by the installation of Qualcomm’s chips in Apple’s smartphones.

Apple said, “We are happy with the decision and thank the court for their time and diligence.” Qualcomm’s general counsel, Don Rosenberg, said it would appeal. Qualcomm had won an infringement suit in Munich in December 2018 that resulted in a ban on the sale of older iPhones in Germany. Apple is appealing that decision.

5. HSBC takes blockchain mainstream

HSBC settled US$250 billion worth of foreign exchange trades using blockchain in the last year, the bank said on January 14.

In a statement, the bank revealed it had settled over three million forex trades and made over 150,000 payments since February concerning trades using blockchain, emphasizing that blockchain trades are only a small percentage of its overall trades.

Richard Bibbey, the bank’s acting head of forex and commodities, said in a statement that the bank was examining how the technology could help multinational clients better manage forex flows.

About the Author

Wendy R. Leibowitz is a freelance contributor. Her work has appeared in the National Law Journal, American Lawyer magazine, and Chronicle of Higher Education.


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