On November 27th, 2013, the European Commission announced that it would not suspend the safe harbor agreement between the EU and the United States that has allowed cross-border personal data transfers between the two jurisdictions since 2000. The announcement followed the Edward Snowden revelations of U.S. surveillance activities, which prompted a number of public calls for suspension of the safe harbor by EU member states and statements by EU officials condemning the U.S.' reported practices. In preserving (for now) the Safe Harbor, the EC nonetheless called for changes to U.S. governmental practices in order to "restore trust in EU-U.S. data flows." It released a Communication (strategy paper) on data flows between the regions, an analysis of how the Safe Harbor has functioned (and where it has failed), and other documents supporting its position. In the accompanying press release, the EC called for action in six key areas:
New York Advertising Law Blog
Of Counsel Jonathan Ezor contributed extensively to a Law360 (subscription required) article about the obstacles European Union companies will face as they attempt to join in "big data" business, which will be in direct contrast to recent efforts to tighten data protection and security rules that include a call to abolish a safe harbor structure that permits the transfer of data between the U.S. and the EU. Ezor points out that, "Without that safe harbor and with the proposed expansion of the EU's data protection directive's requirements, the ability of European companies to obtain and use the type of data sets needed for 'big data' initiatives will be substantially reduced." Ezor also suggests that, "rather than being competitive in big data markets, the EU may find more economic opportunity for its member states in privacy-driven industries such as encryption, data security and tools to improve personal control over information."
Efficiently Stopping False or Unsubstantiated Competitive Advertising in the recent edition of Recent Developments in Advertising Law: Leading Lawyers on Applying Traditional Laws and Policy Guidance to Emerging Technologies and Advertising Media. Recent Developments in Advertising Law is now available for complimentary download by clicking on the title. The chapter, authored by Andrew Lustigman and Howard Smith, discusses the various laws, regulations, and guidelines that apply to promotion efforts and describe the importance of understanding overall strategy to ensure compliance and mitigate the risk of legal exposure. The chapter focuses on the legal, financial and strategic considerations of initiating a challenge before the National Advertising Division (NAD) of the Council of Better Business Bureaus versus filing a Lanham Act case in federal court. The entire book is available via Thomson Reuters
In Shelton v. Restaurant.com, decided on November 4, 2013, the Third Circuit Court of Appeals held that a one-year expiration date for a restaurant gift certificate violated a New Jersey statute with a cumbersome name, the Truth-in-Consumer Contract, Warranty, and Notice Act (TCCWNA). New Jersey's TCCWNA makes it illegal for a seller to enter into a consumer contract that violates a clearly established legal right of a consumer. In this case, the clearly established right in question was another New Jersey law which prohibits gift certificates from expiring within two years of purchase.
The plaintiffs sued after receiving gift certificates with one-year expiration dates. The federal district court in New Jersey originally dismissed the case because the gift certificates were purchased from Restaurant.com and not the restaurants themselves. Therefore, the district court ruled, the gift certificates were not "consumer contracts" and the plaintiffs were not "consumers" under the TCCWNA. That ruling was issued in 2010.
On October 23, 2013, the U.S. Securities and Exchange Commission (the "SEC") proposed for comment amendments to the Securities Act of 1933, as amended (the "Securities Act"), to implement "Regulation Crowdfunding" in accordance with Title III of the Jumpstart our Business Startups (JOBS) Act.
The proposed amendments (i) create rules governing the offer and sale of securities through an Internet website, including individual investment limits and the aggregate offering size for a crowdfunding transaction and required disclosures that must be made by companies before commencing a transaction (see new Section 4(a)(6)), and (ii) provide a framework for the regulation of registered funding portals and broker-dealers that companies are required to use as financial intermediaries in the offer and sale of securities in connection with a crowdfunding transaction (see new Section 4A). The SEC has also proposed an amendment to Section 12(g) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), to exempt securities sold in a crowdfunding transaction from counting towards the number of shareholders that would require SEC issuer registration.
The SEC is seeking public comment on Regulation Crowdfunding for a 90-day period following publication of the proposed rules in the Federal Register. Companies cannot use the proposed crowdfunding rules until the SEC adopts final rules, anticipated to occur in the first quarter of next year.
For the ease of review, we have set forth below a term sheet summary of the details of the SEC's Regulation Crowdfunding proposals:
New York State recently extended the protections afforded to child performers under New York's labor laws to child models. Backed by the efforts of the not-for-profit organization the Model Alliance, State Senators Jeffrey Klein and Diane Savino, and Assemblyman Steven Otis, introduced the legislation, which passed the State Senate and Assembly unanimously on June 12, 2013. The new law, which goes into effect on November 20, 2013 (30 days after Governor Andrew Cuomo's bill signing), aims to protect child models in accordance with all other child entertainers in New York, including actors, dancers, musicians and singers. Businesses that engage the services of print or runway models under the age of 18 in New York State will need to comply with this new law.
In Carrera v. Bayer Corporation, decided August 21, 2013, the Third Circuit Court of Appeals issued an important ruling making class certification more difficult to achieve in certain consumer class actions. The Third Circuit's decision held that if the members of a potential class cannot be ascertained from the defendant's records, there must be a reliable and administratively feasible alternative to determine class membership, or else class certification should be denied.
The plaintiff in this case sought to certify a class of a class of consumers who purchased Bayer's One-A-Day WeightSmart diet supplement, alleging that Bayer falsely advertised that its green tea extract product would speed up metabolism and cause weight loss. Bayer did not sell the product directly to consumers, so there was no complete list of purchasers available to define the class. The plaintiff sought to ascertain the class from retailer records of sales made either online or through loyalty reward programs, and also to allow self-reporting plaintiffs to add themselves to the class by filing an affidavit stating that they had previously purchased the product in question. The district court accepted this proposal and certified a class of Florida purchasers.
Thirty Olshan lawyers have been named by Super Lawyers® for 2013, including first time designee Mary Grieco. They join repeat designees Steve Wolosky, Jeffrey Udell, Mitchell Stern, Kenneth Silverman, Kenneth Schlesinger, Barry Salkin, Samuel Ross, Sheldon Lustigman, Andrew Lustigman, Hyman Kindler, Thomas Kearns, Aliza Herzberg, Steven Gursky, Eric Goldberg, Warren Gleicher, Adam Friedman, Thomas Fleming and Kyle Bisceglie. In addition Safia Anand, Mason Barney, Jason Saltsberg, Howard Smith and Adam Solomon, join repeat designees Ron Berenblat, Andrew Freedman, Elizabeth Gonzalez-Sussman, Lori Marks-Esterman and Peter Sartorius for inclusion in Super Lawyers - Rising Stars Edition 2013, a category for up-and-coming lawyers. View our press release here.
Andrew Lustigman and Howard Smith served as contributing authors on the chapter "Efficiently Stopping False or Unsubstantiated Competitive Advertising" in the recent edition of Recent Developments in Advertising Law: Leading Lawyers on Applying Traditional Laws and Policy Guidance to Emerging Technologies and Advertising Media. Recent Developments in Advertising Law discusses the various laws, regulations, and guidelines that apply to promotion efforts and describe the importance of understanding overall strategy to ensure compliance and mitigate the risk of legal exposure. Lustigman and Smith's chapter focuses on the legal, financial and strategic considerations of initiating a challenge before the National Advertising Division (NAD) of the Council of Better Business Bureaus versus filing a Lanham Act case in federal court. The book is available via Thomson Reuters
On September 17, 2013, from 12:30-1:30pm Eastern time, Olshan will present the webinar Important Changes To The Telephone Consumer Protection Act (TCPA): What You and Your Client Need To Know. CLE credit will be available for this complimentary program which will offer a detailed look at the latest developments in the TCPA, the rapidly evolving federal statute that has spawned hundreds of class actions over telephone calls, text messages and facsimiles targeting virtually every type of business and supplier.