FERC Staff’s White Paper on Manipulation Provides Insights on Commission’s Developing Manipulation Law

FERC Manipulation LawOn November 17, 2016, the Office of Enforcement (“FERC Staff”) of the Federal Energy Regulatory Commission (the “Commission” or “FERC”) issued a White Paper on Anti-Market Manipulation Enforcement Efforts Ten Years After EPAct 2005 (“Manipulation White Paper”) to “provide insight” on its ten years of experience investigating potentially manipulative conduct under the Anti-Manipulation Rule.1  During this period, FERC Staff has investigated over 100 matters, settled 24 proceedings resulting from those investigations, and pursued two matters in administrative proceedings.  In addition, FERC currently is litigating six penalty assessment orders in federal district courts.2  According to FERC Staff, through these investigations and proceedings, the Commission and the courts have “developed a body of law that, while still in its early stages and continuing to evolve, identifies and provides notice on specific types of conduct that can constitute market manipulation in the energy markets and factors that are indicative of such conduct.”3

In its Manipulation White Paper, FERC Staff largely restates its litigation positions – many of which currently are being challenged – and seeks to provide notice of: (1) factors that typically indicate manipulative conduct; (2) specific types of conduct that often constitute manipulation; (3) mitigating and aggravating factors affecting penalty amounts for manipulation violations; and (4) the types of investigations that it has closed without further action.

FERC Staff first provides the following non-exhaustive list of key elements emerging from FERC’s developing manipulation law:

  • Fraud is a question of fact;

  • Fraud includes open-market transactions (g., transactions executed with manipulative intent on exchanges or public trading platforms);

  • Fraud is not limited to violations of a tariff or other express rule;

  • A manipulation violation does not require a showing that the manipulative conduct resulted in artificial prices;

  • The Anti-Manipulation Rule includes attempted fraud;

  • Manipulative intent, even where it is combined with a legitimate purpose, establishes the scienter element of the Anti-Manipulation Rule;

  • Pursuant to its “in connection with” jurisdiction, the Commission has jurisdiction over conduct that affects jurisdictional transactions, including the “rates, terms, and conditions of service in a market”; and

  • Individuals constitute “entities” and, as such, are subject to the Anti-Manipulation Rule.4

Indicia of Fraud

Identifying what it characterizes as typical indicia of fraud, FERC Staff explains that the distinction between fraudulent and lawful market behavior can hinge on the underlying purpose of the behavior.5  For example, in three orders relating to Up-To Congestion (“UTC”) trades, the Commission compared the purpose of UTC trading against the purpose behind respondents’ UTC trades and determined that their trades “were neither consistent with how the UTC product historically traded nor aligned with the arbitrage purpose of those trades.”6  The Manipulation White Paper does not identify where market participants should look to understand what Staff will view as “the purpose” of particular products like UTCs.  Staff emphasizes, however, that the purpose driving a market participant’s behavior in the market is a “critical factor” in a manipulation determination.  FERC Staff recommends, therefore, that companies require employees to document the purpose behind conduct likely to raise red flags.7  In the right circumstances, market participants should also consider documenting their understanding of the purpose of the relevant products and why their trading aligns with those purposes.

Continue reading at the National Law Review

Forecasting the Trump Administration’s First 100 Days

Trump AdministrationWith the 2016 election in the rearview mirror, manufacturers must be mindful of the early initiatives you can expect from Congress and the new administration. With a return to one-party rule, the coming congressional term is likely to be among the most active in recent memory.

President-elect Trump’s appointment of Republican National Committee Chairman Reince Priebus as White House chief of staff signals that, rather than battling the Washington establishment, Trump has now embraced it to get results. Similarly, the decision to replace New Jersey Governor Chris Christie with Vice President-elect Mike Pence as transition team lead means the president-elect understands that, campaign rhetoric aside, his early success will depend on partnering with House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell.

Early Legislation

The Trump transition team was thinly staffed and produced few of the reams of position papers the Clinton team, and even the Romney team in 2012, produced leading up to Election Day. As a result, we believe the core of the term’s early legislation will be a series of bills previously passed, largely by the House, which President Obama refused to consider. The last four years’ deep legislative history offers insight into the likely legislative agenda, for example, the upcoming tax bill or financial services reform.

In the short run, we expect the first weeks of the Trump Administration will focus on quick action to nullify many of the Obama Administration’s executive orders. Priorities likely include approving the Keystone XL pipeline, reversing Clean Air Act rules, striking down the increased minimum wage for federal contractors, and freezing the recruiting of new, non-defense federal employees. Trump also spoke during the campaign about lifting restrictions on U.S. energy development and canceling billions in payments to U.N. climate programs.

On trade, expect the president-elect to order his new commerce secretary to “identify all foreign trading abuses that unfairly impact American workers and direct them to use every tool under American and international law to end those abuses immediately.” Also expect Canada, Mexico, and the United States to begin negotiations to revamp the North American Free Trade Agreement.

We anticipate that Republican leadership to combine a number of priorities into a major reconciliation bill, which will only require 51 Senate votes. (Other Senate bills require 60 votes to advance under current rules.) Key elements in this whopper of a bill will likely be tax reform, the repeal or rewrite of the Affordable Care Act, and financial services reform. Such reform will assuredly eviscerate the Consumer Financial Protection Bureau (“CFPB”), in addition to addressing a number of other issues.

Aside from fleshing out the Cabinet, President Trump will nominate a Supreme Court justice and two members of the Federal Reserve’s seven-member Board of Governors. It is worth noting that the Fed now has jurisdiction over the CFPB. Another interesting decision is whether to fill the open seats on the Export-Import Bank. Three of its five seats are open. While Congress has fought off challenges to kill the bank, Trump could effectively kill it by never filling the vacant seats.

What’s Next?

In the next six months, the new administration and Congress will negotiate some of the largest changes to law in recent memory, substantially impacting manufacturers.

© 2016 Foley & Lardner LLP

USCIS to Increase Fees for Key Immigration Filings

USCIS Immigration FilingsEffective December 23, 2016, U.S. Citizenship and Immigration Services (“USCIS”) will substantially increase fees for numerous immigration filings. In a final rule published on October 24, 2016, the Department of Homeland Security (“DHS”) announced the new fees, which represent a weighted average increase of 21%. The final rule also establishes a new fee for the Form I-924A EB-5 Annual Certification of Regional Center, creates a three-level fee structure for naturalization applications (Form N-400), and revises regulatory provisions addressing dishonored payments and unpaid biometric services fees.


Following a comprehensive review by USCIS for its fiscal year 2016/2017 biennial period, USCIS determined that its current fees do not recover the full costs associated with processing applications and petitions. DHS published a notice of proposed rulemaking on May 4, 2016, and received 475 comments during the sixty-day comment period. The final rule was published on October 24, 2016, and will go into effect on December 23, 2016, applying to filings submitted to USCIS on or after that date.

Increased Fees

The final rule increases fees by a weighted average of 21% for most immigration benefit requests. All applications or petitions that are mailed, postmarked, or otherwise filed on or after December 23, 2016, must include the new fees in order to be processed by USCIS. In other words the new fees apply on the date of submission by the petitioner or applicant and not on the date of receipt by USCIS.

The following is a list of the fee increases most likely to impact employers. These increases include the fees for Form I-129 (used for H-1B, L-1, O-1, TN, and E-1/E-2 filings), Form I-140 (used for employment-based green card petitions, including those based on PERM labor certification), Form I-485 (for the employee and dependent family members to obtain green cards), and Form I-765 (the work authorization form used by F-1 students as well as pending green card applicants). A more comprehensive list of the new fees can be found on USCIS’s website at https://www.uscis.gov/forms/our-fees.

Immigration Benefit Request

Current Fee ($)

New Fee ($), Effective Dec. 23, 2016

I-129/129CW  Petition for a Nonimmigrant Worker



I-140  Immigrant Petition for Alien Worker



I-485  Application to Register Permanent Residence or Adjust Status



I-765  Application for Employment Authorization



Practical Implications of the New Rule

Petitioners and applicants should take note of the increased fees and revise immigration strategies accordingly. In particular, companies and persons planning to file benefit requests in early 2017 should consider filing before fees increase on December 23, 2016.

Copyright 2016 K & L Gates

Obama Administration DOT to Continue Issuing Regulations; Potential DOT Secretaries in Trump Administration

Obama Administration DOTObama Administration DOT to Continue Issuing Regulations

The Obama Administration’s Department of Transportation (DOT) is expected to continue issuing regulations until President-Elect Donald Trump takes office in January. Over the final two months of the Administration, DOT is expected to issue regulations banning cellphone calls on flights and requiring freight trains to use two crew members. Additionally, DOT is expected to issue guidance on vehicle-to-infrastructure technologies, a proposed rule on vehicle-to-vehicle communications, and a proposed rule on operating unmanned aircraft systems (drones) over crowds.

While President-Elect Trump has indicated he will immediately begin undoing regulations and reversing President Obama’s executive actions, it is unclear whether the incoming Trump Administration will prioritize looking at DOT regulations and transportation-related executive actions.

Potential DOT Secretaries in a Trump Administration

The President-Elect Donald Trump’s transition team is currently evaluating potential picks for DOT Secretary. Individuals that have been discussed as candidates include: Representative John Mica (R-FL), a current member of the House Transportation and Infrastructure Committee who lost his reelection campaign this year; James Simpson, a former commissioner of New Jersey’s Department of Transportation and a former head of the Federal Transit Administration; and Mark Rosenker, a former National Transportation Safety Board Chairman; Greg Hughes, the speaker for Utah’s house of representatives; and former Representative Harold Ford Jr. (D-TN), a potential democratic cabinet pick.

This Week’s Hearings:

  • On Friday, December 2, the House Oversight and Government Reform Subcommittee on Transportation and Public Assets will hold a hearing titled “A Safe Track?: Oversight of WMATA’s Safety and Maintenance.” The witnesses will be announced.

© Copyright 2016 Squire Patton Boggs (US) LLP

Law Firm Holiday Cards – Do’s and Don’ts

Q: Are holiday cards effective?

A:  I think that they can be considered one more nice way to stay in touch, to send a friendly communication to a large number of clients and prospects all at once.  Of course, I said that they can be effective, not that they typically are.

Holiday cards pose complex issues of database management and client ownership, combined with the logistical questions of who signs which card(s).  Through hard work and discipline, these are mightily overcome — only to become one of a dozen bland, look-alike cards depicting politically correct images like pine trees, ice skaters, snow-covered skylines, ambiguously decorated snow men, or handicapped children’s artwork — which are then sent to dead former clients.

All in the name of strengthening client relationships?

Superhero, CardDone well, the cards should reinforce your firm’s unique brand message, or at least stand out somehow, so they don’t get immediately discarded and forgotten.

When I was the marketing partner of a law firm, it wasn’t unusual for me to get as many as 25 generic holiday cards per day from vendors all wanting our business.

Glance, toss, forget.

Glance, toss, forget.

Glance, toss, forget.

It helps if you have a strong brand message to use, or at least an interesting design to leverage. 

For example, a number of years ago we used an olive-based branding theme for Florida’s Bryant Miller Olive law firm.  Here’s the cover of their olive-themed holiday card:

Holiday Card

The point is — the card represents your firm and your practice.

Don’t rub clients’ noses in your firm’s lack of creativity by doing the same thing as everyone else.  Find some way to do something different. Those that avoid the spam filters don’t generally create much goodwill.

On rare occasion, extra creativity causes one to stand above the pack and get a notice or a smile.

For example, Phoenix’s Engelman Berger law firm always goes the extra mile.

Baseball Card, LawyerEvery year they try something new, including lawyer baseball cards, comic books, TV Guides, and parodies of board games like Clue and Scrabble, Mad magazine, and a children’s book, “Are You My Lawyer?”

Finally, while I know this whole rant is making me sound like Scrooge, I’ve never been a big fan of cards that promise:

“In lieu of a personal gift to you, we’re making a donation

in your name to the following charity(ies).”

In my actual name?

Did they ask me whether I’d prefer receiving the gift?  Or at least help select the charity? Do I get a tax deduction on that money?  And because they never tell you how much they’re donating, everyone I’ve quizzed about this assumes that they’ve taken this approach because it was cheaper and easier.  (And generally, from my experience, they’re right.)

At least that’s how I see it.

Season’s greetings.

Insurance Coverage Issues for Cyber-Physical Risks

internet of thingsThe recent National Institute of Standards and Technology (NIST)publication of cybersecurity guidance for the Internet of Things (IoT) is a useful reminder that hacking incidents can result not only in privacy breaches, but also in bodily injury or property damage — via critical infrastructure, medical devices and hospital equipment, networked home appliances, or even children’s toys. In addition to enhanced system security engineering and preventive education efforts, insurance is an increasingly essential component in any enterprise risk management approach to cyber vulnerabilities. But purchasers of cyber insurance are finding that nearly all of the available cyber insurance products expressly exclude coverage for physical bodily injury and property damage.

These exclusions are no doubt assumed to “dovetail” with (i.e., to avoid duplicating) the bodily injury and property damage coverage traditionally afforded by general liability and first-party property insurance policies. But it is not always clear whether those more conventional policies cover bodily injury or property damage arising from a cyber-related peril (so-called “cyber-physical” risks). Unless an insurance program specifically addresses these risks, the determination of coverage for physical harm from a cyber-attack may depend on a close reading of policy language and a fact-intensive analysis of how the harm arose.

Policyholders would be well advised to understand the potential cyber-physical risks they face; to analyze all their current lines of coverage to determine whether and how each would respond to those risks; to seek clarifications in their current insurance wordings; to explore new “difference in conditions” insurance products designed to plug any gaps in coverage for such risks; and, ultimately, to expect disputes with their insurers if these novel cyber-physical harms should materialize.

© 2016 Covington & Burling LLP

EEOC Issues Guidance on National Origin Discrimination that Applies to Foreign National Employees

EEOC, National Origin DiscriminationThis week the Equal Employment Opportunity Commission (“EEOC”) released guidance regarding national origin discrimination under Title VII of the Civil Rights Act of 1964 (Title VII).  The guidance replaces Section 13 of the EEOC’s compliance manual, with a view toward further defining “national origin” and helping employers and employees understand their legal rights and responsibilities. The guidance specifically states that Title VII applies to any worker employed in the United States by a covered employer (employer with more than four employees), regardless of immigration status, as well as any foreign national outside the United States when they apply for U.S.-based employment.

The new guidance defines “national origin” as an individual’s, or his or her ancestors’, place of origin, which can be a country (including the United States), a former country, or a geographic region.  In addition, “national origin” refers to an individual’s national origin group or ethnic group, which it defines as “a group of people sharing a common language, culture, ancestry, race, and/or other social characteristics.”  Discrimination based on national origin group includes discrimination because of a person’s ethnicity (e.g., Hispanic) or physical, linguistic, or cultural traits (e.g., accent or style of dress).  Discrimination based on place of origin or national origin group includes discrimination involving a mere perception of where a person is from (e.g., Middle Eastern or Arab), association with someone of a particular national origin, or citizenship status.  Title VII discrimination can take the form of unfavorable employment decisions based on national origin or harassment so pervasive or severe that it creates a hostile work environment.

In addition to clarifying the meaning of “national origin,” the guidance provides examples based on how actual courts have applied Title VII to specific facts.  For example, the guidance gives as an example of “intersectional” discrimination a Mexican-American woman who, without explanation, was denied a promotion at a company where she successfully worked for 10 years, despite two non-Mexican women and a Mexican man being selected for the same position.  The guidance also provides examples where national origin discrimination overlaps with other protected bases, such as discriminating against people with origins in the Middle East due to a perception that they follow certain religious practices.  Further, the guidance gives examples of real cases where employment decisions and harassment constituted Title VII national origin violations, as well as cases where Title VII violations were not found.  Finally, the guidance applies Title VII national origin principles to trafficking cases, where employers use force, fraud, or coercion to compel labor or exploit workers, and such conduct is directed at an individual or a group of individuals based on national origin.

Employers of foreign national workers should note that individuals with Title VII claims may also have claims under other Federal statutes, including the anti-discrimination provision of the Immigration and Nationality Act (INA).  Form I-9 and the E-Verify program are two areas where discrimination claims could arise under both the INA and Title VII.

©2016 Greenberg Traurig, LLP. All rights reserved.