Keep your finger on the legal world's pulse

The Commodity Futures Trading Commission (CFTC) has sued to block Minnesota from enforcing a first-in-nation law to outright ban prediction markets such as Kalshi and Polymarket. The regulator argued the law ​violated the U.S. Constitution by criminalizing at the state level the operation of derivatives markets governed by federal law. "This Minnesota law turns ‌lawful operators ⁠and participants in prediction markets into felons overnight," CFTC Chairman Michael Selig said. "Prediction markets are designed to be addictive and prey especially on ​young people and low-income folks," Minnesota Attorney General Keith Ellison, a Democrat, ​said. "They help the ultra-rich ⁠get richer and the rest of us get poorer."

 

The Hill

New York Times

Reuters

President Donald Trump has postponed plans to sign an executive order on artificial intelligence because he said he was worried the measure could weaken America’s edge on AI technology.  “I didn’t like certain aspects of it,” Trump said of the order. “We’re leading China, we’re leading everybody, and I don’t want anything that’s going to get in the way of that lead.” AI was also “bringing in a lot of jobs”, Trump said. The order would have established a framework for the government to vet the national security risks of the most advanced AI systems before their public release, according to a person familiar with White House deliberations. It was not immediately clear when the signing might be rescheduled.

 

AP News

Financial Times

Politico

Meta has reached a settlement with the Breathitt County School District in Kentucky, the first of many lawsuits filed by school districts across the U.S. seeking compensation for costs related to children's social media addiction and mental health issues. The district aimed to secure over $60m for a 15-year program to address these challenges. The settlement comes as a result of a bellwether case, which was set to go to trial next month in Oakland, California. Plaintiffs' attorneys emphasized their commitment to "pursuing justice for the remaining 1,200 school districts who have filed cases.” The settlement follows earlier court losses for Meta and YouTube regarding social media harms. In March, a jury awarded $6m to a plaintiff who claimed social media addiction worsened her mental health issues.

 

U.S. News

Pizza Hut franchisee Chaac Pizza Northeast has sued the company, alleging that a mandatory artificial intelligence (AI)-based delivery system rollout caused operational failures and more than $100m in losses. The lawsuit claims Pizza Hut’s Dragontail system, introduced in 2024, led to slower deliveries, colder food and lower customer satisfaction across more than 100 restaurants operated by Chaac. The franchisee said sales growth turned negative after the rollout and accused Pizza Hut of forcing stores to continue using the system despite worsening performance metrics.

 

Business Insider

Costco has asked a U.S. federal judge to dismiss a proposed class action alleging the retailer should refund customers for higher prices charged before the Supreme Court struck down import tariffs imposed by President Donald Trump. Costco argued the lawsuit was speculative and that customers voluntarily paid advertised prices, while stating it has not yet received any tariff refunds from the government and has not determined how any future refunds would be shared with members.

 

Reuters

Verizon has said software flaws rather than stolen passwords have become the dominant entry point for hackers. In a review of more than 31,000 incidents in its annual Data Breach Investigations Report, Verizon found 31% started with vulnerability exploitation. The report said attackers are using AI to spot and exploit known vulnerabilities at machine speed, with the technology accelerating attacks from months to hours. Hackers are “demonstrably using GenAI to help at different stages of attack including targeting, initial access, and development of malware and other tools . . . AI’s primary impact is currently operational: automating and scaling techniques defenders already know how to detect, not yet unlocking these novel or rare attack surfaces.” Meanwhile, employees are not waiting for IT approval before adopting AI tools. Unapproved AI usage at work tripled from 15% to 45% of the workforce, making “shadow AI” the third most common source of non-malicious data leakage.

 

BankInfoSecurity

InfoSecurity Magazine

Techzine Global

Roberto Gonzalez, a former partner at Paul Weiss, is joining Paul Hastings as a litigation partner. His move follows a series of departures from Paul Weiss' litigation department, including Kannon Shanmugam and Masha Hansford, who left to establish Davis Polk's Supreme Court and appellate practice. Gonzalez previously co-chaired the economic sanctions and anti-money laundering practice group at Paul Weiss and has represented major banks, fintechs, and technology companies in various regulatory matters.

 

Bloomberg Law

Law

U.S. semiconductor firm Broadcom is suing EU antitrust regulators in Luxembourg-based General Court, Europe's second-highest, over their requests for documents containing legal advice from the company's U.S. lawyers in ​a case related to VMware, which it acquired in 2023. "This filing is a ​procedural action solely to protect Broadcom's rights under the long-recognized rules ​on legal professional privilege in non-EU countries, including the U.S.," ⁠said the company, adding: "As a U.S.-headquartered company with global operations, ​Broadcom regards legal professional privilege as a fundamental right that must be protected ​and our action is narrowly tailored to address only this interest." Broadcom said it is acting on a matter of principle and is otherwise cooperating with the European Commission's requests for information.

 

U.S. News

Reuters

South Africa's Constitutional Court, the country's top court, has struck down parts of the National Health Act, a law that would enable the government to determine where doctors and other healthcare professionals can work.  Powers given to the health minister under the law to issue so-called certificates of need that healthcare professionals will require to practice were unconstitutional and invalid, the court found. Anton van der Bijl, the deputy chief executive officer of labor union Solidarity, an opponent of the National Health Act, said: “No government can force doctors, dentists, nurses and other healthcare practitioners through regulations to create quality healthcare where the government itself has failed.”

 

Bloomberg

News24

The International Court of Justice (ICJ) has ruled that the right to strike is protected in a key treaty of the International Labour Organisation (ILO). The top United Nations court had been asked to issue a non-binding advisory opinion on whether a treaty drawn up in 1948 by the International Labour Organisation, known as Convention 87, implicitly enshrines such a right. The treaty includes the right for workers "in full freedom, to organize their administration and activities." Unions said this by extension enshrines the right to industrial action, but employers disagreed. ICJ president Yuji Iwasawa said the court was "of the opinion that the right to strike of workers and their organizations is protected" under that convention. However, judges said their non-binding opinion should not be understood as laying out any other ground rules for strike action. The conclusion "does not entail any determination on the precise content, scope or conditions for the exercise of that right," Iwasawa said.

 

France 24

The threat posed to workers by artificial intelligence is giving employers more leverage, and CEOs are increasingly demanding results and holding people accountable for them. The focus now is on building a “performance culture” - a phrase used 633 times on earnings calls and in corporate documents, up from about 460, across companies in the S&P 500 Index last year - where expectations of workers soar, underperformers risk getting managed out and executives are less forgiving of bureaucratic impediments to efficiency. Ben Bryant, a professor of leadership and organization at Switzerland’s IMD Business School, wonders: “What will be sacrificed in the interests of performance?” Bloomberg observes that employee mental health, which business leaders prioritized during the pandemic, could once again get short shrift. 

 

Bloomberg