Keep your finger on the legal world's pulse

Ketan Bhirud, Christopher Allen, and Grace Garver of Cozen O’Connor highlight the pivotal role state AGs will play in shaping regulatory policies under a potential Trump administration with Republican Congressional support. AGs wield significant influence through multistate investigations and litigation, impacting labor, energy, and corporate governance sectors. Republican AGs are expected to back deregulation and challenge DEI and ESG initiatives, while Democratic AGs will likely oppose regulatory rollbacks and push progressive agendas. This divergence forces businesses to navigate competing priorities and legal risks tied to compliance and policy shifts. The authors urge businesses to monitor AG actions, enhance compliance programs, and proactively engage with AGs to mitigate risks. Establishing relationships with newly elected AGs in states like Pennsylvania and North Carolina and collaborating with industry peers can provide strategic advantages. By staying informed and fostering engagement, businesses can better navigate regulatory challenges and adapt to evolving legal landscapes while minimizing reputational and financial risks.

 

Bloomberg Law

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Beth George, Giles Pratt, and Lutz Riede, partners at Freshfields, highlight the growing global focus on regulating artificial intelligence (AI), particularly generative AI, in light of its transformative potential and associated risks. While the E.U. leads with its AI Act, a comprehensive framework imposing strict duties and fines of up to €35m ($37m) or 7% of annual turnover, other regions have taken varied approaches. The U.S. relies on a patchwork of state laws, with differing regulatory models in states like Colorado and California, while China, Brazil, and Canada are advancing their AI-specific laws. The authors note that collaboration remains limited. Although safety institutes and a binding AI treaty among the E.U., U.S., and U.K. exist, enforcement mechanisms are weak. Many jurisdictions continue to adapt existing laws or issue guidelines, creating a fragmented and complex regulatory landscape. Businesses face significant challenges in navigating these divergent frameworks. The Freshfields partners emphasize the importance of strong governance structures and flexible leadership to adapt to rapid regulatory changes. They warn that cross-border AI projects must prepare for varied and evolving compliance requirements, as the regulatory landscape continues to develop globally.

 

Bloomberg Law

Character.AI (C.AI) is facing a second lawsuit alleging that its artificial intelligence (AI) chatbots encouraged a 17-year-old autistic boy to self-harm and suggested he could kill his parents for limiting his screen time. The complaint, filed in the U.S. District Court for the Eastern District of Texas, claims that “inherent to the underlying data and design of C.AI is a prioritization of overtly sensational and violent responses.” It further argues that the design of C.AI isolates children from their families, undermines parental authority, and thwarts efforts to keep them safe online.

 

Bloomberg Law

Nvidia Corp. is set to face a lawsuit after the U.S. Supreme Court dismissed its appeal regarding allegations of misleading shareholders about its reliance on crypto-mining revenue. The court's decision, made without explanation, follows a questioning of the case's legal significance by justices. Justice Sonia Sotomayor remarked, “I'm not actually sure what rule we could articulate that would be clearer than our cases already say.” The lawsuit, led by E. Ohman J:or AB, claims that chief executive Jensen Huang concealed the fact that the company's revenue growth was primarily driven by crypto-related sales of its GeForce GPU, rather than gaming. The investors argue that the volatility of the crypto market led to significant losses when Nvidia's revenue projections fell short in 2018, resulting in a 28% drop in shares. The case is Nvidia v. E. Ohman J:or Fonder.

 

Bloomberg Law

U.S. Bankruptcy Judge Christopher Lopez has rejected the auction sale of Alex Jones' Infowars to The Onion, citing flaws in the bidding process and the inadequate compensation for Sandy Hook families. The Onion, which had offered £1.75m, aimed to relaunch Infowars as a parody, but Lopez stated: “You got to scratch and claw and get everything you can for them,” emphasizing the need for a better outcome for the families affected by Jones' conspiracy theories. Christopher Mattei, representing the Sandy Hook families, expressed disappointment but reaffirmed their determination to hold Jones accountable. The auction's outcome leaves Jones in control of Infowars, as he continues to appeal the substantial defamation judgments against him.

 

Billings Gazette

Missoulian

MTStandard.com

Boston Globe

Law firm leaders often tout a strong culture, but recent trends suggest a shift towards profit-driven practices. Legal Tech Monitor highlights three key developments: the rise of nonequity partners, the de-equitization of underperforming equity partners, and the influence of lateral partners who prioritise financial gain over firm culture. As the author notes: "Cohesive law firms with partners devoted to the firm and their partners are becoming a thing of the past." This shift indicates that the traditional values of loyalty and culture are being overshadowed by a focus on profits, leading to a cutthroat environment where the essence of the legal profession is at risk.

 

Legal Tech Monitor

Donald Trump has requested a federal judge in Pennsylvania to dismiss the defamation lawsuit filed by the Central Park Five, arguing that his comments during a presidential debate were protected political rhetoric. He stated: “Plaintiffs now attempt to recast political rhetoric and debate about criminal justice and public safety as ‘defamation.'” The plaintiffs, Antron Brown, Kevin Richardson, Raymond Santana, Korey Wise, and Yusef Salaam, assert that Trump's remarks were false and defamatory, claiming they never pled guilty to any crime and were exonerated. Trump's legal team contends that his statements reflect opinions formed in 1989 and are protected under the First Amendment. The outcome of this motion could significantly impact the balance between free speech and defamation law in public discourse.

 

Lawyer Monthly Magazine

A U.S. appeals court has ruled that Nasdaq cannot require companies listed on its exchange to include women, racial minorities, or LGBTQ individuals on their boards or explain their absence. The conservative-majority 5th U.S. Circuit Court of Appeals, based in New Orleans, found that the rules, approved by the U.S. Securities and Exchange Commission (SEC), violated federal securities law. The decision, a 9-8 ruling, is a significant victory for opponents of corporate diversity mandates. The challenge was led by conservative groups, including the National Center for Public Policy Research and the Alliance for Fair Board Recruitment, founded by Edward Blum, who previously led the successful Supreme Court case against race-conscious college admissions. Writing for the majority, Judge Andrew Oldham, a Trump appointee, stated that the SEC "has intruded into territory far outside its ordinary domain." Nasdaq, which believed its rule would benefit companies and investors, announced it would not appeal the decision. The SEC said it is reviewing the ruling, which could only be overturned by the Supreme Court. The case highlights a broader debate on the role of federal regulators in shaping corporate diversity policies.

 

Reuters

Researchers from George Mason University, Columbia University, University of Hong Kong and Arizona State University report that Deloitte paid newly-hired accountants with H-1B visas an estimated 10% less than U.S. workers in similar roles. The researchers used 2005 salary data hacked and publicly released in December 2014. While H-1B worker status wasn’t included in the hacked data, the researchers used U.S. Department of Labor data to infer which workers held the visas. “This finding calls into question the efficacy of regulatory mandates thought to prevent H-1B visa holders from being paid less than U.S. citizens in similar roles,” the researchers wrote in their report, which was published in the Journal of Business Ethics. In response, Deloitte said that “the data set cited in this paper is incomplete and has not been validated."

 

HR Dive

New Jersey Gov. Phil Murphy has signed a groundbreaking law prohibiting public and school libraries from banning books based on their content, origin, or authors’ backgrounds. The law also protects librarians from civil and criminal charges for adhering to the legislation, making New Jersey the third Democrat-led state, alongside Illinois and Minnesota, to enact such measures. Signed at Princeton’s public library, the law responds to increasing restrictions in Republican-led states where books—often those with LGBTQ+ and racial themes—are frequently challenged. “It’s the antithesis of all these book-banning states,” Murphy said, casting the legislation as part of a national divide on intellectual freedom. Under the law, libraries must establish policies for book curation and the removal of materials, ensuring a process to address concerns. Exceptions are allowed for “developmentally inappropriate material” for certain age groups. Librarians, who have faced harassment and threats over controversial books, praised the law for safeguarding intellectual freedom.

 

AP News

EY's U.K. legal division has experienced another significant loss, with 11 lawyers departing to join the London office of U.S. firm Hunton Andrews Kurth LLP. This marks the third round of departures in just over a year, following two previous job cuts due to a decline in demand for advisory services. Ferdinand Calice, managing partner, stated: “Our energy-focused corporate and disputes teams in London have experienced tremendous growth over the past year, expanding our reach throughout Europe, the Middle East and Africa.”

 

Bloomberg Tax

Crowell & Moring has appointed Kenneth Dintzer, a distinguished trial lawyer with over 30 years at the U.S. Department of Justice (DoJ), as a partner in its antitrust and competition, government contracts, and litigation groups. Dintzer, who previously served as deputy branch director at the DoJ National Courts Section, has managed over 100 trial and appellate lawyers and has been involved in significant cases, including United States v Google, where he secured a verdict against the tech giant for monopolistic practices.

 

CDR

Boies Schiller Flexner is rewarding its associates with bonuses exceeding $1m this year, driven by a new revenue-sharing formula. According to an internal memo, over 95% of associates will receive bonuses at or above market rates, with amounts ranging from $21,000 to $140,000 based on experience. Matthew L. Schwartz, managing partner and chairman-elect, stated: “We ask our associates to take on significant responsibilities early in their careers, and we’re more than happy to reward them by sharing in the upside of the returns the firm receives as a result.” The firm has also introduced a $25,000 referral bonus for current associates who recruit new talent and a $150,000 signing bonus for those coming directly from federal clerkships. Following a revenue increase to $246m in 2023, Boies Schiller is positioned to offer these substantial bonuses.

 

ABA Journal

Nippon Life Insurance is set to acquire Resolution Life Group Holdings for approximately $8.2bn, marking the largest takeover by a Japanese insurer. A total of nine law firms, including Debevoise & Plimpton, Herbert Smith Freehills, and Kirkland & Ellis, are advising on the transaction. This acquisition aims to bolster Nippon Life's international operations amid stagnant domestic growth due to Japan's declining population. Resolution, which manages life insurance portfolios, is valued at $10.6bn and has over $85bn in reserves. Clive Cowdery will continue as chairman and chief executive post-acquisition, with Blackstone remaining as an advisor. Nippon Life anticipates that its overseas businesses will contribute 20% to its core operating profit following the deal, up from 4%.

 

The Global Legal Post

TheCityUK's latest report, "U.K. Legal Services 2024: Legal Excellence, Internationally Renowned,"reveals that legal services contributed £37bn to the U.K.’s gross added value in 2023. Revenues from legal services rose by 7.7%, reaching £47.1bn ($60bn), with net exports increasing by 14% to £7.6bn ($9.6bn). Richard Atkinson, Law Society president, noted that this growth “reflects the high regard and the pivotal role that English and Welsh solicitors play in providing world-class legal services to global clients.” The sector employs over 368,000 people and is a significant player in international legal markets, with 200 international law firms based in the U.K. The report also highlights the U.K.'s position as a LawTech hub, attracting £5.5bn ($7bn) in investments in 2023. Miles Celic, chief executive of TheCityUK, emphasized the sector's vital contribution to jobs and growth, stating that the rule of law is essential for its continued success.

 

The Global Legal Post