Category: Regulatory

U.S., Mexican, and Canadian Officials Conclude First Round of NAFTA Modernization Talks

On August 20, trade officials from the United States, Mexico, and Canada concluded the first round of negotiations to modernize the North American Free Trade Agreement (NAFTA). In a joint statement released following five days of talks, trade officials reiterated their commitment to updating the deal, continuing domestic consultations, and working on draft text. They also pledged their commitment to a comprehensive and accelerated negotiation process to set 21st Century standards and to benefit the citizens of North America.

Their agenda covered a wide range of existing and new NAFTA chapters, including: updating the Rules of Origin, adding and amending trade remedies provisions, addressing transparency, combatting corruption, increasing intellectual property protections, and addressing issues facing financial services and investment. The U.S. reportedly tabled roughly 10 proposals updating existing chapters or proposing new ones. Officials expect the modernized NAFTA deal will include a total of 30 chapters (the current agreement is comprised of 22 chapters and seven annexes).

The NAFTA negotiating teams are being led by Assistant U.S. Trade Representative for the Western Hemisphere John Melle, veteran Canadian trade expert Steve Verheul, and Director of the Embassy of Mexico’s Trade and NAFTA Office Kenneth Smith Ramos. In addition to negotiators, a number of Canadian and Mexican stakeholders – including eight members of the Mexican Senate and 150 representatives of Mexico’s private sector – were present on the margins of the talks. However, U.S. negotiators have acknowledged that their accelerated schedule leaves little time for formal business stakeholders to be included in events like those organized during the Trans-Pacific Partnership talks.

Negotiators are expected to head to Mexico City for the second round of talks from September 1 to 5, and to Canada for their third round in late September (reportedly September 23-27). Negotiators will continue at this rapid pace, moving back to United States in October and planning additional rounds through the end of the year. The NAFTA parties hope to finish talks by the end of 2017 or early 2018, ahead of Mexico’s July 2018 presidential elections.

This post was written by Mayte Gutierrez and Ludmilla L. Savelieff of Squire Patton Boggs (US) LLP © Copyright 2017
For more legal analysis go to The National Law Review

New York City Tells Fast Food Employees: “You Deserve A Break Today” By Enacting New Fair Workweek Laws

Earlier this week, New York became the third major city in the United States to enact “fair workweek” laws aimed at protecting fast food and retail employees from scheduling practices that are perceived by the employees to be unfair and burdensome.   Following the lead set by San Francisco and Seattle, New York has adopted a series of new laws aimed at enhancing the work life of fast-food and retail employees.  By eliminating certain scheduling practices commonly used by fast food and retail employers, the New York Legislature seeks to protect these employees from unpredictable work schedules and fluctuating income that render it difficult for them to create budgets, schedule child or elder care, pursue further education, or obtain additional employment.   These new laws include the following provisions:

  • Fast food employers must now publish work schedules 14 days in advance;
  • If fast food employers make any changes to an employee’s schedule with less than 14 days’ notice, the employer must pay the employee, in addition to the employee’s normal compensation,  a bonus payment  ranging from $10 to $75 depending on the amount of notice provided of the change;
  • Before hiring new employees, fast food employers must first offer any available work shifts  to current employees, thereby enabling part-time employees desiring more work hours the opportunity to increase their hours worked and, accordingly, their income, before the employer hires additional part-time employees;
  • Fast food employers may no longer schedule an employee to work back-to-back shifts that close the restaurant one day and open it the next day if there are less than 11 hours in between the two shifts.  However, if an employee consents in writing to work such “clopening” shifts, the fast food employer must pay the employee an additional $100;
  • Fast food employees may ask their employers to deduct a portion of their salary and donate it directly to a nonprofit organization of their choice (This provision is a victory for unions as fast food employees can now earmark money to a group that fights for their rights, and the employer has to pay it on their behalf); and
  • Bans all retail employers  from utilizing  “on-call” scheduling that requires employees to be available to work and to contact the employer to determine if they are needed at work.
This post was written by John M. O’Connor of Epstein Becker & Green, P.C.

New Opportunities for Credit Union Ownership of Real Estate in Massachusetts

Proposed changes to National Credit Union Administration’s rule on federal credit union (FCU) ownership of real estate and to the Massachusetts credit union parity rules, promise to open new areas of credit union investment in real estate as an ancillary business line. Assuming both proposed rule changes take effect this summer, FCUs and MA state charters will have the ability to buy, develop, own and sell commercial real estate, provided that the FCU eventually (within six years of purchase or such longer period as NCUA may allow) occupies at least half of each property. The remaining space in each property may be leased by the FCU to unaffiliated tenants or to a developer entity, for re-leasing to third parties. In calculating how much of a property a specific CU occupies, space occupied by a CUSO that is controlled – through voting rights, without necessarily majority economic ownership – by the CU may be included.House, Real Estate

Combined with last year’s NCUA action which eliminated the 5% cap on fixed asset ownership by non-RegFlex FCUs, NCUA is now about to allow FCUs to acquire commercial properties they can never fully utilize, by treating up to half the property for investment/rental purposes. This will allow FCUs to consider ownership of small strip malls and other income-producing properties which were previously off-limits, and could signal a shift away from leasing and toward ownership as FCUs site their branches and operations centers.

The financial benefit from this major regulatory change can be enhanced if FCUs are able to create CUSO-based joint ventures with private real estate capital sources to reduce the portion of the equity investment required from the credit union. Further regulatory guidance on this potential aspect of FCU real estate investment is needed, but insofar as all FCUs and many state CUs (soon to include Massachusetts, through the currently proposed amendments to its CU parity rules, to allow state chartered Massachusetts CUs to partner with non-credit union co-owners of CUSOs, just as FCUs have been able to do for more than a decade) can through CUSOs partner with non-credit union co-owners/capital sources, it is possible that through a CUSO credit unions may  acquire commercial property partly for use and partly for investment/rental, and raise at least a portion of the acquisition’s equity capital  from non-CU third party equity sources. Of particular interest is the ability of CU executives to share ownership of CU real estate as partners in a CU-led CUSO, an arrangement that would allow select individuals to co-invest privately in these new real estate ventures. Completing the financing picture could be a commercial first mortgage loan from the sponsor credit union to the CUSO, perhaps with customary limited guaranties from some of the non-CU co-investors in the CUSO.

While this action by NCUA is a welcome step toward more rational, flexible facility ownership and management practices for affected credit unions, and offers those institutions a new ancillary revenue source, NCUA is clear that its action does not allow real estate speculation or full-scale CRE investment by credit unions. All acquired properties must eventually, typically within six years, be at least 50% devoted to housing the CU-owner and/or any CUSO controlled by it.

Whatever deal structures ultimately emerge, NCUA is about to open the door to limited but meaningful credit union equity investment in the kind of commercial real estate deals that previously CUs could finance only on the debt side. And with Massachusetts about to allow state charters to partner with non-credit union co-investors through CUSOs, we can expect to see both federal and state charters here explore equity co-investment opportunities with more traditional real estate investors and developers, and possibly even individual CU executives, as CUs move into this newest investment arena.

© 2016 SHERIN AND LODGEN LLP

FCC to Issue Net Neutrality Rules–Federal Communications Commission

Armstrong Teasdale Law firm

In February, Federal Communications Commission Chairman Tom Wheelerwill circulate a draft order regarding Net Neutrality to his four fellow commissioners. The Net Neutrality rules will govern whether Internet service providers (ISPs), such as Comcast or Verizon, can block access to websites or give preferential treatment to traffic from websites that pay for such treatment. To sustain the rules, the commission may change the regulatory classification of broadband service, subjecting it to rules, known as Title II, that apply to traditional phone service, rather than the less restrictive Title I rules that currently cover broadband. 47 U.S.C. §§ 153–621.

This will be the FCC’s third attempt at imposing Net Neutrality obligations. The U. S. Circuit Court reversed the commission’s first two attempts, finding that the rules were inconsistent with the classification of broadband as a Title I service. Comcast Corp. v. FCC, 600 F.3d 642 (D.C. Cir. 2010); Verizon v. FCC, 740 F.3d 623 (D.C. Cir. 2014). In the most recent opinion, the court struck down two rules, one prohibiting ISPs from blocking access to websites and one prohibiting them from unreasonably discriminating against traffic from websites or applications.

In response, the FCC published a proposal to reinstate the rules with small changes to address the Court’s concerns. The proposal was roundly criticized by Net Neutrality proponents, because it did not flatly outlaw discrimination. President Obama weighed in with a statement in favor of Net Neutrality rules. Recently, Chairman Wheeler has strongly indicated that the new proposal will reclassify broadband as a Title II service and include a rule banning unreasonable discrimination. The Chairman plans to circulate a draft order to the other commissioners, giving them a chance to comment on the draft and vote on the proposal at the FCC’s open meeting on February 26.

The effect of the rules is uncertain. Rules banning discrimination have been in place for only three of the 12 years since Net Neutrality was first proposed. Even though discrimination was allowed for more than nine years of that time, ISPs have not been able to convince content providers to pay for priority treatment. The new rules may outlaw activities that the ISPs do not have the market power to engage in anyway. But the rules will give content providers comfort that the ISPs will not be able to charge them for priority service in the future.

The bigger (and more uncertain) impact will arise if the FCC reclassifies broadband as a Title II service. If this happens, the Commission will probably forbear from applying most sections of Title II to broadband.  But the FCC’s authority to forbear from applying the statute in these circumstances is uncertain. Such a  decision  will be challenged on each section of Title II and the myriad of regulations under it. Litigation will last for years. If the FCC’s decision to forbear is reversed, the ISPs may be subject to some very onerous Title II regulations, such as obligations to resell their services, obligations to sell out of tariffs, and price restrictions. The outcome could be a messy hodge-podge of regulations that apply to some services and providers but not others.

ARTICLE BY
Andrew Crain
Charles W. Steese
Sandra L. Potter
OF
Armstrong Teasdale

Dealing with Personal Information at the Water’s Edge… Re: U.S. Safe Harbor Program

Jackson Lewis Logo

 

Privacy and data security issues and concerns do not stop at the water’s edge. Companies needing to share personal information, even when the sharing will take place inside the same “company,” frequently run into challenges when that sharing takes place across national borders. In some ways, the obstacles created by the matrix of federal and state data privacy and security laws in the U.S. are dwarfed by the matrix that exists internationally. Most countries regulate to some degree the handling of data, from access, to processing, to disclosure and destruction. And, the law continues to develop rapidly, sometimes due to unexpected events. Take, for example, the U.S. Safe Harbor programthat was designed to facilitate the transfer of personal data of individuals in the European Union (EU) to the United States. Because the EU believes that the law in some countries, including the U.S., fails to provide “adequate safeguards,” the general rule is that personal data of EU persons cannot be sent to the U.S. unless an exception applies. One exception is based on a negotiated deal between the EU and the U.S., commonly known as the U.S. Safe Harbor, a program which currently is in some jeopardy due to the recent reports of NSA monitoring, Snowden, etc.

data information EU European Union world

Currently, to meet the Safe Harbor, a company must take certain steps, including (i) appointing a privacy ombudsman; (ii) reviewing and auditing data privacy practices; (iii) establishing a data privacy policy that addresses the following principles: notice, choice, onward transfer of data, security, integrity, access and enforcement; (iv) implementing privacy and enforcement procedures; (v) obtaining consents and creating inventory of consents for certain disclosures; and (vi) self-certifying compliance to the U.S. Department of Commerce.

A recent statement from Viviane Reding, European Commissioner for Justice, Fundamental Rights and Citizenship, quoted in The Guardian, October 17, 2013, signals some changes may be in store for the Safe Harbor:

The Safe Harbour may not be so safe after all. It could be a loophole because it allows data transfers from EU to US companies, although US data protection standards are lower than our European ones,” said Reding. “Safe Harbour is based on self-regulation and codes of conduct. In the light of the recent revelations, I am not convinced that relying on codes of conduct and self-regulation that are not policed in a strict manner offer the best way of protecting our citizens.

At the same time, the EU continues to update and strengthen its protections for personal data. Companies that operate globally need to be sensitive to not only complying with the laws specific to activities within a jurisdiction, but also to activities between jurisdictions. Common business decisions such as deciding where data will be stored, setting up global databases for employees medical, personnel and other information, arranging for enterprise-wide employee benefits or monitoring programs, can face significant obstacles relating to the interplay of the data privacy and security laws of the countries involved.

Article by:

Joseph J. Lazzarotti

By:

Jackson Lewis P.C.

Consent Isn’t the Only Consideration: NY Comic Con Attendees Disagree that Hijacking Twitter Accounts Makes the Event “100x cooler! For realz.”

MintzLogo2010_Black

The comic book industry is no stranger to displays of heroic anger and berserker rage, but over the weekend New York Comic Con (NYCC) was on the receiving end of considerable fan fury after it began ghostwriting effusive tweets about NYCC and posting on the Twitter pages of NYCC attendees in a way that made it appear as though the attendee was the author of the tweet.

During the event registration process, NYCC attendees were given the option of linking RFID badges to their Twitter account through the event’s mobile application interface.  During the application registration process, attendees were asked to authorize NYCC to access their Twitter accounts.  At this point, attendees arguably consented to having NYCC impersonate the attendee when posting about NYCC on the attendee’s Twitter feed.

The NYCC website page explaining the ID badge technology and the site’s registration page did not mention that NYCC would be posting to attendee Twitter pages on the attendee’s behalf.  Rather, the registration process is explained as a method for giving the attendee access to enhanced social media content, while helping NYCC protect against fraudulent credentials.  The activation terms provided that NYCC could use the information collected through the badge “for internal purposes” and to contact the user about future events.  After a user registered his or her badge and elected to link a Twitter account, the user was presented with an opt-in notice (a screenshot of which can be seenhere), specifying that following authorization, the application would be able to, among other things, “post Tweets for you”.  This type of warning is not uncommon.  For example, any website that allows users to click to share news articles or stories on their Twitter pages requires this type of access.

In spite of the opt-in warning, the wide-spread surprise among attendees suggests that the opt-in language did not draw a clear distinction between posting tweets for a user and posting tweets as a user.  Moreover, the failure to mention this practice when explaining the registration process could have led attendees to conclude that even if they were agreeing to provide this type of access, NYCC would not be taking the unusual step of pretending to be the attendee when it published tweets on the user’s page.

NYCC’s initial response was a brief tweet telling attendees not to “fret” over the ghostwritten posts and informing attendees that the “opt-in feature” had been disabled.  However, after anger continued to spread, NYCC issued a longer statement apologizing for any “perceived overstep.”

This type of disconnect between online service providers and users is becoming increasingly common as advances in technology permit mobile device and social media data to be accessed and used in new ways.  Earlier this year, for example, Jay-Z and Samsung stepped into a public relations debacle when the “JAY Z Magna Carta” mobile application required that the user, in exchange for receiving a free music download, authorize the application to have extensive access to phone data and social media accounts. The response from NYCC attendees also underscores the lesson learned by Googleearlier this month, that consent provided by users who do not fully understand what they are consenting to may not be consent at all.

As your online business finds new and innovative ways to deliver products and services to your users, it is important to take a step back and consider whether additional communications in different formats, such as just-in-time notifications, are necessary to ensure that the only surprise your customers have is how great your products and services are.   Or, to put it another way, “with great power comes great responsibility.”

Article By:

 of

New Employee Wellness Program Rules for 2014

Poyner Spruill

Employers continue to look for ways to manage the cost of employee health care coverage as they navigate the turbulent waters of healthcare reform, and wellness programs continue to be a popular strategy.  However, adoption and expansion of these programs have been hampered somewhat by questions about their effectiveness, cost, and the risk of noncompliance with the uncoordinated web of laws and regulations governing these programs.  While evidence seems to be emerging that at least some wellness program designs can be an effective means for cost control and long-term savings due to improved health, recently issued final regulations under the Health Insurance Portability and Accountability Act (HIPAA) effective beginning in 2014 only add additional burdens to employers’ compliance efforts.

HIPAA amended ERISA to generally prohibit discrimination against individual participants and beneficiaries in eligibility, benefits or premiums based on “health status-related factors,” including physical and mental illnesses, claims experience, receipt of health care, medical history, genetic information, evidence of insurability, and disability.  However, under the wellness program exception to HIPAA group health plans may offer premium discounts, rebates, reduced co-payments and/or lower deductibles (generally referred to as ‘rewards’) to participants and beneficiaries who take part in “programs of health promotion and disease prevention.”

The final HIPAA nondiscrimination regulations, effective for plan years beginning after 2013, create two categories of programs under the wellness program exception: ‘participatory wellness programs’ and ‘health-contingent wellness programs.’

Participatory wellness programs either provide no reward  or do not condition a reward on the achievement of a health standard.  Examples of participatory wellness programs include:

  • Reimbursing all or part of the cost of a fitness center membership;
  • Reimbursing costs of participation or rewarding participation in a smoking cessation program regardless of whether the individual quits smoking; and
  • Rewarding participation in a no-cost health education seminar, a health risk assessment, or a diagnostic testing program, regardless of outcomes and without requirement for further actions.

A participatory wellness program must be available to all similarly situated individuals regardless of health status, but otherwise is not required to comply with the more strenuous requirements applicable to health-contingent wellness programs.

Health-contingent wellness programs require an individual to satisfy a standard related to a health factor to obtain a reward or require an individual to undertake more than a similarly situated individual based on a health factor in order to receive the same reward.  Health-contingent wellness programs are divided into two subcategories: ‘activity-only wellness programs’ and ‘outcome-based wellness programs.’

Activity-only wellness programs require an individual to perform or complete an activity related to a health factor in order to obtain a reward, but do not require the individual to attain or maintain a specific health outcome.  Examples of activity-only wellness programs include walking, diet, or exercise programs.  If an individual cannot participate in the activity due to a health factor, then a reasonable alternative (or waiver of the otherwise applicable standard) must be provided in order to qualify for the reward.

Outcome-based wellness programs require an individual either to attain a specific health standard or complete an activity or other requirement related to the health factor in order to obtain a reward.  These programs usually have two tiers: a measurement, test or screening, followed by a program that targets individuals who do not meet a pre-specified standard.  Examples of outcome-based wellness programs include:

  • Reward for non-tobacco use, or participate in a tobacco use cessation program; and
  • Reward for cholesterol, blood pressure or body mass index below a specified level, or take additional steps, such as complying with a prescribed plan of care or participating in a exercise program.

An individual who does not meet the specified health standard must be provided a reasonable alternative (or waiver of the otherwise applicable standard) in order to qualify for the reward.

Both activity-only wellness programs and outcome-based wellness programs must satisfy the following five additional requirements:

  • Individuals eligible for the program must be given the opportunity to qualify for the reward at least once per year.
  • The size of the reward(s) under all health-contingent wellness programs is limited to a maximum of 30% (50% for tobacco nonuse/cessation programs) of the total cost of elected coverage.
  • The program has a reasonable chance of improving the health of, or preventing disease in, participating individuals, is not overly burdensome, is not a subterfuge for discrimination based on a health factor, and is not highly suspect in the method chosen to promote health or prevent disease.
  • The full reward must be available to all similarly situated individuals and, as previously discussed, a reasonable alternative must be provided for obtaining a reward.   The plan is permitted to seek verification from the individual’s physician only that a health factor makes it unreasonably difficult or medically inadvisable for the individual to participate in an activity, and not whether the individual can satisfy a specified health standard.  Alternatives do not have to be determined in advance but must be provided upon request within a reasonable time.
  • Notice of the availability of a reasonable alternative must be provided in all plan materials that describe the terms of the health-contingent wellness program, and include contact information for obtaining the alternative and a statement that recommendations of an individual’s personal physician will be accommodated.

Add to these new rules the alphabet soup of other rules that impact wellness programs, including HIPAA privacy and security, GINA, ADA, ADEA, Title VII, FLSA, and COBRA, and it becomes clear that plan sponsors would be well-served to have even the most seemingly simple program reviewed by legal counsel for compliance.

Article By:

 of

Alleged STOLI Producers Found Guilty of Fraud and Other Criminal Charges

DrinkerBiddle

Earlier today, a jury in the United States District Court for the Southern District of New York found independent insurance producers Michael Binday, James Kergil, and Mark Resnick guilty of mail and wire fraud, and conspiracy to commit those offenses.  The jury also convicted Kergil and Resnick of conspiracy to obstruct justice.  Sentencing has been scheduled for January 15, 2014.  The convicted defendants may face up to 80 years in prison.

During the 12 day trial, federal prosecutors argued that Binday, Kergil, and Resnick lied to insurers to perpetrate the scheme and then lied again to cover it up.  Based on the testimony of insiders and insureds, along with the defendants’ own emails and other documents, prosecutors specifically argued that the defendants:

  • recruited brokers to solicit elderly clients to serve as straw-buyers for the policies, with promises of large commissions to the brokers and payments to the clients upon the sale of the policies;
  • submitted applications to insurers for more than $100 million in life insurance, which grossly misrepresented the insureds’ income and net worth and lied about the intent to sell the policies, the fact that the premium would be financed by third-parties, and that multiple policies were being applied for or had been issued in the name of the insured;
  • recruited accountants and other professionals to submit bogus inspection reports and other documents purporting to verify the insureds’ financials;
  • conspired to thwart insurers’ attempts to investigate the representations made in the policy applications and to disguise the source of premiums paid for the policies by wiring funds into insureds’ accounts; and
  • earned millions of dollars through commissions and in some cases by arranging to cash in themselves on the death benefits upon an insured’s death.

Insurance industry leaders Jim Avery, the former Vice Chairman and President of Individual Life Insurance for Prudential, and Mike Burns, a Senior Vice President at Lincoln Financial Group, also testified during the government’s case in chief.  Both testified about their companies’ anti-STOLI policies, the harm to insurers that STOLI caused, and the measures the companies took to try to screen it out.

The evidence relating to the conspiracy to obstruct justice charges against Kergil and Resnick included alleged recorded calls that a scheme insider, who testified under a plea agreement, had with Kergil and Resnick, and testimony from an employee of the Apple computer store where Resnick allegedly had taken his computer to have the hard drive wiped clean.  The alleged calls, which were recorded in cooperation with the FBI, involved discussions about Kergil’s instruction to Resnick and the insider to destroy all records with Binday’s name on them and to wipe their computer hard drives clean.

Each of the defendants was separately represented by his own counsel, and none of the defendants took the stand in his defense.  Instead, the defendants presented excerpts from approximately a dozen files for policies that the defendants submitted to the insurers and that supposedly contained STOLI red flags.  Based on these documents, the defendants argued that the insurers were not deceived by the defendants’ lies and that the scheme was profitable for all involved and not criminal activity.  On rebuttal, the prosecutors introduced additional evidence from the insurer files showing that the insurers’ attempts to investigate the STOLI red flags were met with more lies on the part of the defendants and their associates.

This criminal prosecution has already spawned at least one civil action by an insurer seeking to have a STOLI policy allegedly involving Resnick and Binday declared null and void.

A Different Kind of Adobe Update: Adobe Announces Data Breach Compromising Information of 2.9 Million Customers

MintzLogo2010_Black

Adobe Systems Inc.,(ADBE -1.24%) announced earlier today that has been the victim of a cyber attack that has compromised information of 2.9 million of its customers.  In a blog post Thursday morning, Adobe’s Chief Security Officer Brad Arkin referred to such attacks as “one of the unfortunate realities of doing business today” and added that the attack on customer information is believed to be linked to an attack in which hackers obtained source code for certain Adobe products, including its Cold Fusion web application platform and its Acrobat family of products.

Adobe Systems Inc. reported what it called a sophisticated attack on its computer network, involving illegal access to both customer information and source code related its programs

The scope of the breach was first disclosed by security blogger, Brian Krebs in his blog, Krebs on Security.  The customer information accessed by the hackers includes names, encrypted credit or debit card numbers, expiration dates, and other information relating to customer orders.  At this time Adobe does not believe that decrypted credit or debit card numbers were obtained.  Adobe has reset passwords for certain customers and will be notifying customers whose debit or credit card information is believed to have been accessed.  For those customers whose credit or debit card information has been accessed, Adobe will offer a complimentary one-year membership with a credit monitoring service.

This latest incident is a reminder that cyber attacks are not only an “unfortunate reality” of doing business, but are also increasingly common.  If your business collects customer or user information, there is no time like the present to make sure you have a response plan in place.

Read more:

New York Times – Adobe Announces Security Breach

PCWorld – Adobe Reports Massive Security Breach

Wall Street Journal — Hackers Hit Adobe Systems Network 

AllThingsD

Article By:

 of

Your Facebook “Like” May Be Constitutionally-Protected Speech

barnes

According to a recent decision by the United States Court of Appeals for the Fourth Circuit, pressing the “like” button on your Facebook page constitutes substantive speech that may be protected by the First Amendment.

Six employees of the Hampton, Virginia Sheriff’s Office were dismissed because they showed support for Sheriff B.J. Roberts’ electoral opponent. They filed suit against Sheriff Roberts, claiming in part that their terminations violated the First Amendment. The United States District Court for the Eastern District of Virginia granted summary judgment to Sheriff Roberts, in part because the court found that the employees failed to allege that they had engaged in protected speech.

The plaintiff of significance in this matter, Roy Carter, Jr., claimed his protected speech in support for Sheriff Roberts’ opponent came in the form of a Facebook “like” for the opponent’s page. The Eastern District of Virginia held that the thumbs-up button by itself did not constitute sufficient speech to merit First Amendment protection. Not so, ruled the Fourth Circuit – when Carter pressed “like,” he caused to be published on his Facebook profile and on his friends’ news feeds that he liked Sheriff Roberts’ opponent’s campaign, which is a substantive statement.

“That a user may use a single mouse click to produce the message that he likes the page instead of typing the same message with several individual key strokes is of no constitutional significance,” held the court. Further, the Court stated that hitting the “like” button is the internet equivalent of displaying a political sign in one’s front yard, which the Supreme Court has held constitutes substantive speech.

The district court’s ruling was reversed for Carter and two other plaintiffs and the matter was remanded. Although the three remaining plaintiffs may not recover monetary damages because of the sheriff’s Eleventh Amendment immunity, they may have an opportunity to be reinstated.

The full text of Bland v. Roberts may be found here.