BLT: April 2020

 

Featured Articles

Business & Corporate

Delaware and the SEC Facilitate Virtual Stockholder Meetings as the COVID-19 Outbreak Spreads

As concern over COVID-19, the novel coronavirus, increases and restrictions are being imposed on public gatherings, U.S. public companies have been weighing risks associated with holding in-person annual stockholder meetings. While the vast majority of U.S. public companies continue to hold annual stockholder meetings at a physical location, in light of the COVID-19 outbreak, many corporations are now considering whether to hold the meeting solely by means of remote communication or to hold a hybrid meeting in which stockholders may choose to participate either in person or remotely.

Business & Corporate

RegTech: How Technology Can Revolutionize Compliance

Highly regulated industries like the financial services industry have faced ever increasing regulatory compliance obligations. Technology, such as artificial intelligence (AI), that can be utilized to innovate the manner in which these organizations operate can lead to additional challenges for regulatory compliance, and the regulatory environment can drastically impact innovation in these sectors.

Business & Corporate

COVID-19 and Data Privacy: Health vs. Privacy

The Black Death stole people’s identities. Sweeping through Europe and Asia periodically from the 14th to the 18th century, the disease erased entire cities, and individual graves were traded for huge trenches with scores of nameless bodies. Spread by traders and human travel that brought disease carriers everywhere, people were reduced to numbers, as not only the sick disappeared but so did everyone who might have remembered them.

Business & Corporate

COVID-19 and Data Privacy: Health vs. Privacy

The Black Death stole people’s identities. Sweeping through Europe and Asia periodically from the 14th to the 18th century, the disease erased entire cities, and individual graves were traded for huge trenches with scores of nameless bodies. Spread by traders and human travel that brought disease carriers everywhere, people were reduced to numbers, as not only the sick disappeared but so did everyone who might have remembered them.

Business & Corporate

Online Ticket Seller Faces the Music on Extra Fees

On February 13, 2020, the Canadian Competition Bureau struck another blow against so-called “drip-pricing” ticket selling tactics when it slammed the deceptive online advertising, marketing, and selling practices of StubHub Canada Ltd. and StubHub Inc. (collectively “StubHub”) for failing to display the real price of the entertainment and sporting events tickets they sold upfront, instead augmenting prices through the addition of quasi-hidden mandatory fees.

Business & Corporate

Comment Concerning Use of Electronic Signatures and Third-Party Opinion Letters

Parties to business transactions and their counsel seldom gather in the same location to exchange manually-signed agreements and other documents; virtual closings have been and are the norm.* The COVID-19 crisis has resulted in increased focus on the widespread practice of giving opinions on the execution of agreements signed electronically. This Comment explains the legal basis for the conclusion underlying those opinions that the electronic signatures on those agreements have the same legal effect as manual signatures.

Business & Corporate

Update on Border Searches of Electronic Devices

Early in 2018, Business Law Today published an article of mine dealing with the legal ethics implications of border search policies of the Customs and Border Protection (CBP) and Immigration and Customs Enforcement (ICE) relating to portable electronic devices. The article adverted to a then-recently filed lawsuit in federal court in Boston challenging the validity of these policies as a general proposition (i.e., not related to any issues of professional ethics). Nominally brought on behalf of 11 travelers whose smartphones and other electronic devices were searched without a warrant at the U.S. border, the case was funded by the ACLU, the Electronic Frontier Foundation, and the ACLU of Massachusetts.

Business & Corporate

Drafting Earnout Provisions to Manage Litigation Risk

Disagreements between parties over the purchase price in an acquisition often can be driven by their differing views of the selling company’s future performance and cash flows. To get to “yes,” parties may bridge their valuation differences by agreeing to an earnout, meaning they set agreed-upon metrics regarding the company’s post-closing performance and measure those metrics after closing. The seller then “earns” additional payments if the post-closing performance validates its valuation position. Parties must carefully define the details of how they will measure the earnout payment. The 2019 ABA Private Target Mergers and Acquisitions Deal Points Study (which examined 151 deals valued between $30 million and $750 million from 2018 and the first quarter of 2019) found that approximately 27 percent of those deals included earnout provisions.

Business & Corporate

SEC Announces Conditional Relief for Companies Affected by Coronavirus

On March 4, 2020, the Securities and Exchange Commission (“SEC”) issued an order (the “Order”) providing conditional relief to reporting companies affected by the novel coronavirus disease, or COVID-19. In recognition of the potential disruptions to transportation and limitations on access to facilities, support staff and professional advisors caused by COVID-19, the Order provides reporting companies with an additional 45 days to file certain disclosure reports that would otherwise have been due between March 1 and April 30, 2020, subject to certain conditions.

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