The New York Appellate Division has reaffirmed that the manifest disregard doctrine is a "severely limited… doctrine of last resort" that requires more than a mere error of law to warrant vacating an arbitral award. This case involved the acquisition contracts between Daesang and NutraSweet, under which NutraSweet could rescind the deal if it was sued for antitrust law violations. After NutraSweet exercised this right, Daesang commenced an arbitration proceeding for breach of contract.
Unbeknown to many, Section 1782 of Title 28 of the US Code permits parties to obtain discovery in the United States in aid of non-US legal proceedings, including – in some instances – international arbitrations. Such discovery can include documents and sworn testimony (eg, depositions). In conducting an arbitration seated outside the United States (or other non-US legal proceedings), it is useful to understand the mechanics, requirements and key issues of Section 1782 discovery.
California Governor Jerry Brown recently signed into law Senate Bill (SB) 766, Representation by Foreign and Out-of-State Attorneys. The bill, which was passed 69-to-zero by the legislature, clarifies that foreign (ie, not licensed in the United States) and out-of-state (ie, licensed in a US jurisdiction, but not in California) attorneys can represent parties in international arbitrations in California, subject to certain conditions. SB 766 will take effect on 1 January 2019.
One of the most significant roles of the Department of Transportation (DOT) is to protect airline consumers from unfair and deceptive practices and unfair methods of competition by air carriers and ticket agents. Yet, surprisingly, the key statutory terms 'unfair' and 'deceptive' are not defined in statute and the DOT has never attempted to define them, until now. It is expected that airlines and airline trade groups will support the DOT's proposal, while consumer groups may be more sceptical.
The Department of Transportation recently issued the Enforcement Notice Regarding Denying Boarding by Airlines of Individuals Suspected of Having Coronavirus. The enforcement notice acknowledges that medical certificates are unlikely to demonstrate whether a passenger is a direct threat, especially as there are no known measures that would prevent transmission of coronavirus in the cabin's closed environment.
The Department of Transportation (DOT) has proposed significant changes to its disability regulations relating to the transportation of service animals by air. The DOT's current regulations require that airlines allow passengers to travel with a wide range of animals in cabin on the basis that they are service animals or emotional support animals. This article sets out the DOT's most significant proposed changes.
The US Treasury Department's Office of Foreign Assets Control (OFAC) recently announced sanctions against Apollo Aviation Group LLC for violation of the then-effective Sudan Sanctions Regulations. The takeaway from the OFAC's Apollo decision is clear: aircraft lessors cannot rely on a boilerplate lease clause to protect them; rather, they must exercise pro-active vigilance over the products that they are leasing out, know their customers and in some cases know their customers' customers.
The US Department of Transportation (DOT) has issued a notice of proposed rulemaking to amend its regulations governing situations in which an aircraft remains on the airport tarmac without an opportunity for passengers to deplane for an extended period. Specifically, it proposes to change the departure delay exemption, carrier reporting requirements and record retention requirements, among others. Comments on the notice of proposed rulemaking must be filed with the DOT by 24 December 2019.
The Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation recently announced that they will stop accepting London Interbank Offered Rate-indexed adjustable-rate mortgages by the end of 2020. Additionally, the two government sponsored agencies announced that they will soon accept mortgages tied to the Secured Overnight Financing Rate later in 2020.
To mark the new year, registered investment advisers and funds should take a look back at the activity undertaken by the Securities and Exchange Commission (SEC) and its staff during 2019 and carefully consider steps to be taken to implement new and amended regulations adopted by the SEC throughout the year. The start of a new year is also a good time to evaluate what remains on the SEC's regulatory agenda.
The Financial Industry Regulatory Authority (FINRA) recently released its 2019 Report on Examination Findings and Observations. The report intends to reflect key findings and observations identified in FINRA's recent examinations of broker-dealers. The report also describes practices that FINRA has deemed to be effective and that could help firms to improve their compliance and risk management programmes.
The Securities and Exchange Commission recently charged a Switzerland-based securities dealer for offering and selling unregistered security-based swaps to US investors using bitcoins and for failing to transact its swaps on a registered national exchange. This case illustrates that the use of new technology and terminology does not exempt investment-product dealers from having to comply with US federal securities laws.
The Supreme Court recently granted a writ of certiorari to address whether the Securities and Exchange Commission (SEC) may obtain disgorgement in civil injunctive actions filed in the federal courts. How the court resolves this question may have a significant impact not only on the SEC's enforcement programme, but also on a wide array of other federal regulators that rely on courts invoking similar equitable authority to fashion remedies.
The Financial Industry Regulatory Authority recently censured and fined a Florida-based broker-dealer, including for failing to reasonably supervise sales of complex securities such as structured products and leveraged, inverse and inverse-leveraged exchange-traded funds. This case illustrates the need for broker-dealers to establish and enforce proper surveillance systems and written procedures to ensure the suitability of their sale recommendations.
While antitrust and consumer protection laws provide flexibility for firms to respond to changing market conditions, such as those created by the COVID-19 pandemic, it is important to remember that certain conduct will remain prohibited by antitrust and consumer protection laws no matter the circumstances.
Until recently, the Federal Trade Commission's (FTC's) ability to seek monetary equitable remedies (particularly disgorgement and restitution) for alleged antitrust violations went virtually unchallenged. However, the most recent appellate case that interprets the FTC's monetary equitable remedies under Section 13(b) of the FTC Act leaves open many questions about the FTC's ability to seek monetary equitable remedies in antitrust cases pursuant to Section 13(b).
The Department of Justice Antitrust Division and the Federal Trade Commission have announced the release of the 2020 Draft Vertical Merger Guidelines (VMG) for a 30-day comment period. As with any guidelines issued by the agencies, the finalised VMG will be instructive for the agencies' review of vertical mergers and will be persuasive but not binding on the courts should a contested merger enter litigation.
California's governor recently signed a bill designed to enhance antitrust scrutiny of patent settlements between branded and generic pharmaceutical companies. The bill follows the California attorney general's nearly $70 million settlement in Summer 2019 with several pharmaceutical companies based on patent settlements that the attorney general claimed violated the Cartwright Act and is yet another example of diverging interpretations between federal and state antitrust laws.
The Federal Trade Commission and the Department of Justice's Antitrust Division recently released the Hart-Scott-Rodino Annual Report for Fiscal Year 2018, covering 1 October 2017 to 30 September 2018. This report is the first opportunity to review data regarding the merger challenges issued exclusively during Trump's administration. The data underscores the importance and benefit of advance planning and strategy to avoid a second request investigation whenever possible.