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IP Law 101: 3 Ways to Protect Your Trade Secrets

Avoid losing control of your confidential information with the IRAC method. Read

Words of Wisdom from 10 Powerful Female In-house Counsel

Women achieve more when working together. Here’s some career advice to help you attain your goals. Read

The End of Corporate Social Responsibility (CSR) Window-dressing?

Now that the investment firm giant BlackRock has taken a stand and demanded CSR, will corporations take heed? Read

ASC 606: Classifying Settlement Proceeds and IP Licenses

Considerations for recognizing revenue from settlement contracts, the two distinctions of IP licenses, and more. Read

EU Data Regulators Review EU-US Privacy Shield

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In Brief

Today's Top Story

Companies Are Diversifying Their Boards

A growing number of companies ranging from Tyson Foods and Republic Services to Best Buy and Foot Locker are eschewing traditional board candidates and opting for diverse members, reports Bloomberg (18 April, Green). Many of them are first-timers with no experience. In 2017, 45 percent of appointees to the boards of S&P 500 companies were novice directors, the most since recruiter Spencer Stuart started keeping tabs in 2006. In addition, last year was the first time a majority of the incoming board members were either female or minority candidates. Changing a board's demographics and traditions comes with risks, however. David Larcker, a professor at Stanford's Graduate School of Business, advises, "The board [still] needs to function well to perform its oversight. It's not just a check box."

From "Companies Are Diversifying Their Boards"
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Regulatory Developments

FCA Warns Companies Over Preference Shares

Andrew Bailey, chief executive of the U.K. Financial Conduct Authority, has told companies to make it clear to investors whether their preference shares can be redeemed for less than the market price. The letter follows controversy at Aviva, the insurance company, which provoked an outcry last month when it said it was considering cancelling its irredeemable preference shares. The price of the preference shares dropped sharply on the news, reports the Financial Times (19 April, Ralph). In his letter, Bailey said that companies should make the original terms and conditions of preference shares available to all holders and potential holders, and also produce a Q&A document that would detail "the extent to which the rights attaching to the shares can be changed by the company without specific resolution of the affected class of securities."

From "FCA Warns Companies Over Preference Shares"
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SEC Proposes Rewrite of Broker Conflict Rules

The U.S. Securities and Exchange Commission (SEC) on Wednesday proposed overhauling its conflict of interest rules for brokers, a move likely ensuring that Wall Street will not have to comply with a Department of Labor (DOL) fiduciary rule, reports Bloomberg (18 April, Bain). At a public meeting, the SEC commissioners voted 4-1 to seek public comment on a new "best interest" obligation for brokers. If the SEC's plan goes into effect, the industry expects it to replace the DOL's rule. "Our framework is sound," SEC Chair Jay Clayton said. "It reflects a multi-pronged effort to fill the gaps between investor expectations and legal requirements." Specifically, the SEC proposal requires that brokers disclose all "key facts" about potential conflicts, and mandate that they have a "reasonable basis" to conclude investment products are in their clients' best interests. To address confusion over the various titles used in the financial industry, the SEC also proposed that brokers be banned from referring to themselves as "advisors" or "advisers."

From "SEC Proposes Rewrite of Broker Conflict Rules"
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Board/Management Relations

Role of In-House Lawyers in Singapore Must Evolve, Says Judge

A new study found nearly one in five general counsel in Singapore harbors ambitions of becoming a chief executive or chief operating officer; however, many in the profession may have to reinvent themselves to rise further. Only 18 percent of general counsel say they are doing work that has "greatest strategic value to their business," although 52 percent expect to be doing such work within five years. Judge of Appeal Steven Chong recently gave in-house counsel advice on what they need to do in their evolving role, while not losing sight of certain core issues. In-house counsel must be prepared to evolve beyond their traditional role of providing just legal advice to giving strategic business advice as well, Chong noted. Further, general counsel's role is not only to influence management, but also to determine the direction, values, and culture of the business, reports The Straits Times (19 April, Leong).

From "Role of In-House Lawyers in Singapore Must Evolve, Says Judge"
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Labor and Employment

Can Employee Training Eliminate Biases?

Following an incident at a Starbucks in Philadelphia that prompted charges of racial prejudice, Executive Chairman Howard Schultz called Demos President Heather McGhee to discuss the use of anti-bias training to prevent employees from making similar errors, reports the New York Times (18 April, Scheiber, Abrams). Starbucks then announced that it would close all of its U.S. stores on 29 May to offer such training for 175,000 employees. Starbucks referred to unconscious or implicit bias, which occurs when people make decisions based partly on stereotypes while unaware that the stereotype has influenced them. The University of California, Berkeley's Jason Okonofua says anti-bias training "allows people to just think in a more mindful way when interacting with other people. It's putting yourself in the other person's shoes, seeing humanity in that person." Others caution that such training is a sensitive exercise that can be ineffective or backfire if managed incorrectly. American University's Seth Gershenson warns any training that involves explicitly telling people to set aside their biases is likely to fail as it demands so much mental energy it can exhaust people. "In the moment of stress, we tend to forget our training," says Mursion CEO Mark Atkinson. Some specialists contend the best way to eliminate unconscious bias is limiting the extent to which people engage in automatic, reflexive thinking, which can be done by steering employees toward more thoughtful and deliberative decision-making.

From "Can Employee Training Eliminate Biases?"
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Why Asking About Current Pay is the New Taboo for Prospective Employers

Major companies have instructed recruiters not to ask job candidates about salary or benefits in their previous employment, as more employers stop using past wages as a guide for setting their future salaries due to new laws designed to close wage gaps in the workforce, reports the Wall Street Journal (19 April, Gee). In 2016, New York City and Massachusetts passed rules barring employers from pressing job seekers to report salary history, and more than 12 additional cities and states have done the same since then. Advocates say withholding information about past pay encourages employers to assess the value of a job instead of the applicant. Employers say providing candidates with a salary range based on skills and experience can help fix inconsistencies in how different employees were valued in another role or setting. "These new laws have created a great opportunity for employers to do some self-reflection," says Fisher & Phillips partner Cheryl Pinarchick. She also notes many are considering whether they can warrant differences in the salaries that their current workers make. Pay disparities for employees often linger when people are hired at lower salaries early in their career and then that compensation becomes the basis of future salary negotiations. This gap can widen due to differences in candidates' willingness to negotiate and success rates in those discussions. A U.S. Court of Appeals recently ruled that businesses may be held liable for discrepancies in their workers' wages even if the imbalance is rooted in a previous employer, adding further pressure to correct pay gaps based on gender, race, or other nonperformance-related variables.

From "Why Asking About Current Pay is the New Taboo for Prospective Employers"
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Diversity Issues

Ernst & Young Faces Sexual Harassment Allegation

Ernst & Young is facing a sexual harassment complaint from one of its partners, claiming the world's third largest accounting firm failed to respond adequately to misconduct allegedly witnessed by other senior people at the firm. Jessica Casucci, an Ernst & Young partner since 2014, claimed multiple senior colleagues had witnessed a male partner lift her up and sexually harass her at a conference in Orlando, but did nothing to stop him. Casucci said in her complaint that she was subject to harassment by multiple partners at the firm in addition to the unwanted advances in Florida by a tax partner in 2015, reports the Financial Times (18 April, Bissell-Linsk). Casucci said her career suffered after the incident, because she sought to distance herself from the partner by turning down projects and had to "completely reinvent her career."

From "Ernst & Young Faces Sexual Harassment Allegation"
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Morgan Stanley to Seek New Court for Italian Case

Morgan Stanley is seeking to have a suit against it for 2.7 billion euros (US$3.34 billion) in damages thrown out of an Italian administrative court, three sources close to the case said. The U.S. investment bank maintains that derivatives contracts signed with Italy's Treasury that led to losses should be scrutinized by a civil court, not by the Court of Accounts, which rules on abuses of public funds, the sources said ahead of the first hearing in Rome. The Morgan Stanley derivative transactions were made between 1995 and 2005 and were terminated in December 2011 and January 2012, Morgan Stanley said in a securities filing. If the Court of Accounts judge accepts the Morgan Stanley claim, the state would then have three months to bring its case before a new tribunal, reports Reuters (19 April, Lusi).

From "Morgan Stanley to Seek New Court for Italian Case"
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Tax Issues

McDonald's Problems in India Grow

Tax authorities have raided the offices of McDonald's Corp.'s biggest partner in India in what could be another setback for the fast-food giant, which is already mired in an ugly breakup with its only other licensee in the fast-growing South Asian nation. According to a spokeswoman for India's income tax department, 20 locations connected to Hardcastle Restaurants Pvt. Ltd., which runs more than 270 McDonald's in the south and west of the country, had been raided in the western cities of Mumbai and Pune. Hardcastle said it fully complies with tax laws and that the visit was "part of a routine survey being conducted by the income tax department. They have certain queries and we are fully cooperating with them." Since McDonald's first restaurant opened in India almost 22 years ago, the chain has embedded its brand with the country's emerging middle class but now faces much tougher competition from local and international brands, reports the Wall Street Journal (18 April, Abrams).

From "McDonald's Problems in India Grow"
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Chevron Canada Should Pay for Pollution in Ecuador, Court Told

A group of indigenous Ecuadorians is arguing in an Ontario court that they should be able to seize shares of Chevron Canada to pay for the pollution its parent company allegedly left in their homeland. It has been 25 years since the case was originally launched by a group representing 30,000 Ecuadorians, who say their land and people have been poisoned by 900 pits of toxic waste left behind in the Amazon by Texaco, a company now owned by Chevron. Chevron shut down its operations in Ecuador decades ago, and a U.S. judge barred any American court from enforcing an Ecuadorian Supreme Court ruling against Chevron. The plaintiffs are now asking Canada's justice system to enforce that US$9.5 billion Ecuadorian judgment against Chevron Canada, even though the ruling was made against Chevron Corp., a U.S. company that owns Chevron Canada via seven intermediary subsidiaries, reports The Star (18 April, Oved).

From "Chevron Canada Should Pay for Pollution in Ecuador, Court Told"
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Petrobras Nears Deal With China's CNPC to Swap Refinery Investment for Oil

Brazil's state-run oil company is nearing a deal in which China National Petroleum Corp. Ltd. (CNPC) would invest in an oil refinery in exchange for crude oil, according to two people with knowledge of the talks, potentially giving China its first refining capacity in the Americas. Petróleo Brasileiro SA, or Petrobras, may give the state-owned Chinese firm stakes in oil fields it operates in the Campos basin, off the Rio de Janeiro coast, along with the right to use the new Comperj refinery, the sources added. The talks highlight rising Chinese interest in the Brazilian oil sector, which has attracted billions of dollars from oil majors over the past year for rights to new exploration blocs as the government lowers barriers to foreigners, reports Reuters (19 April, Viga Gaier).

From "Petrobras Nears Deal With China's CNPC to Swap Refinery Investment for Oil"
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P&G to Buy Merck's Consumer Health Unit

Procter & Gamble Co. (P&G) has agreed to acquire Merck KGaA's consumer health unit for 3.4 billion euros (US$4.2 billion), giving it vitamin brands such as Seven Seas and greater exposure to Latin American and Asian markets. The maker of Pampers diapers and Gillette razors said the deal would help it expand its portfolio of consumer healthcare products which includes Vicks cold relief. The deal follows GlaxoSmithKline agreeing to buy Novartis out of their consumer healthcare joint venture for US$13 billion after dropping its pursuit of Pfizer's consumer unit, reports Reuters (19 April, Burger).

From "P&G to Buy Merck's Consumer Health Unit"
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