BLT: November 2019

     

    Featured Articles

    Business & Corporate

    Business and Ethical Challenges: Human Rights Requirements, Due Diligence, Remediation, and Brand Protection

    Susan A. Maslow

    Most companies and the boards that govern them like to think their operations and supply chains are free of human rights abuses, yet of the 40 million estimated people enslaved worldwide, 16 million are working in forced labor within company operations and supply chains. Millions more work under dangerous and sometimes brutal conditions, toiling for up to 19 hours a day and subject to physical abuse at the hands of their supervisors. The eighth edition of the List of Goods Produced by Child Labor or Forced Labor and the 17th annual edition of the Findings on the Worst Forms of Child Labor published in September 2018 by the U. S. Department of Labor’s Bureau of International Labor Affairs (ILAB) highlight specific industry sectors in which child labor or forced labor persists. Abused workers can be found around the world, including within the United States. According to the human rights group Walk Free Foundation, an estimated 400,000 people are believed to be trapped in trafficking and modern slavery in the United States. If for no reason other than brand protection, there is a need for immediate proactive corporate initiatives in this context. To eradicate modern slavery, the C-suite must be encouraged by business lawyers to actively engage in supporting meaningful upstream and downstream change in identifying and remediating modern slavery.

    Business & Corporate

    Proposed Change to Federal Rules of Civil Procedure Could Reduce Questions as to Federal Diversity Jurisdiction

    Thomas E. Rutledge, Christopher E. Schaefer

    At its April meeting, the Advisory Committee on Civil Rules approved a proposed amendment to Federal Rule of Civil Procedure 7.01 that, if adopted, will require that each party to a lawsuit in federal court where jurisdiction is conditioned upon diversity jurisdiction (28 U.S.C. § 1332) file a statement setting forth the information necessary to determine each parties’ citizenship.

    Business & Corporate

    Drafting an Enforceable Noncompete Agreement

    Sterling L. Miller

    For the last several years, noncompete agreements have been under attack in the United States by regulators, legislators, and the courts. For example, late last year, Massachusetts joined a number of states by enacting a law regulating noncompete agreements, including making them inapplicable to “nonexempt” employees. Courts do not favor noncompetes and will limit them or invalidate them completely. Regardless, noncompete agreements are here to stay, and businesses continue to rely on them as one way to protect customer goodwill along with confidential and proprietary information, which is why it’s important for counsel (in-house and outside) to take steps to ensure the noncompete agreements used by their clients have the best chance of surviving regulatory and judicial scrutiny.

    Business & Corporate

    ABA Business Law Section Comments on IOSCO Cryptocurrency Guidance

    Michael L. Spafford, Daren F. Stanaway

    The American Bar Association’s Business Law Section recently issued a letter in response to a request for comments from the International Organization of Security Commissions (IOSCO) on its May 2019 Consultation Report addressing “Issues, Risks and Regulatory Considerations Relating to Crypto-Assets Trading Platforms” (IOSCO Report or Report).[1] The IOSCO Report, citing “the emergence of crypto-assets [as] an important area of interest for regulatory authorities,” provided guidance concerning oversight of secondary markets and the trading platforms that facilitate secondary trading of crypto-assets (Crypto-Asset Trading Platforms or CTPs). Members of the ABA Derivatives and Futures Committee’s Subcommittee on Innovative Digital Products and Processes (IDPPS) prepared the comment letter to highlight the need to evaluate whether new regulations are necessary to fit crypto-assets and CTPs within current regulatory frameworks, to consider the viability and potential of self-regulatory organizations (SROs), and to encourage an economic cost-benefit analysis of any new regulations.[2]

    Business & Corporate

    The New British Invasion: Will European Deal Terms Rock the U.S. M&A Boat?

    Michel Gélinas

    M&A deal terms originating from Europe are increasingly found in the United States, particularly in the context of cross-border deals. Transactions featuring these deal terms are not yet common, but with the current deal environment, including the prevalence of auctions and increased sell-side private equity activity (both primary and secondary exits), some of these deal terms may eventually become commonplace in the United States. This article focuses on two emerging trends in the United States: the use of Vendor Due Diligence Reports (VDD) and the locked-box mechanism.

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