Farm Lending Pitfalls For Urban Lawyers

OK, so you’re a sophisticated lending attorney in Metropolis who is comfortable with everything from aircraft financing to syndicated loans secured by casinos in Macau. Yet you feel a twinge of uncertainty when a business loan is to be secured by wine inventory made from grapes grown in both California and Washington. You know intuitively that anytime farmers, ranchers or food processors are in the mix, either as a borrower or a supplier to the borrower, the underwriting and documentation challenges are not uniform on a state-by-state basis, and are compounded by an overlay of federal laws designed to protect growers of perishable crops and providers of livestock. To get a reality check, you sometimes will secretly call your law school classmate who oddly returned to Smallville and now represents its one bank.

Your concerns are justified but can be reduced by understanding a handful of specific laws that should prompt discussion of documentation and collection risks. First and foremost, all 50 states have unique lien statutes designed to protect those who provide goods, services, land and labor to farmers, ranchers and food processors. Dealing with competing liens and quantifying risk is nothing new to lenders, but the problem posed by agricultural liens is that they often are not searchable (no public filing is required), yet they often are senior in lien priority to conventional Uniform Commercial Code (UCC) security interests. As a result, the number and size of such liens are unknowable except from reliance on the borrower’s own books and records, which hopefully are current and accurate.

To exemplify this risk, let’s return to the winery loan that made you uneasy. California law provides a Producers Lien (Cal. Food & Agric. Code 55631-55653) to unpaid grape producers in an unlimited amount without requiring any public or searchable filing. A Producer Lien’s priority is senior to all UCC security interests and other claims, except for UCC warehouse liens and laborers’ wage claims. Cal. Food & Agric. Code 55633; Frazier Nuts v. American AgCredit, 141 Cal. App. 4th 1263 (2006). The Producers Lien attaches not only to the wine sitting in the borrower’s inventory, but also to the accounts generated by the sale of wine. Frazier Nuts, supra, at 1270. Thus, the lender’s $10 million revolving line of credit, ostensibly well secured by wine inventory and accounts valued at $20 million, has a far different risk profile if the borrower did not fully disclose the amount of unpaid grower claims, an amount which varies during the winery’s business cycle. The full amount of these Producer Liens will prime the lender’s unpaid loan if collection remedies ever become necessary. Cal. Food & Agric. Code 55634.

Faced with this risk, a reasonable lender might attempt to identify likely holders of Producer Liens and obtain a waiver or subordination of the statutory liens. This solution is possible but not foolproof; waivers of Producer Liens laws have been overturned on grounds showing they were not knowingly and intentionally given. See, e.g., Silva Farms v. Wells Fargo Bank (In Re GVF Cannery, 202 B.R. 140 (N.D. Cal. 1996).

Before throwing in the towel, however, bear in mind that some statutory agricultural liens are searchable because of public filing requirements and are also governed by the UCC’s “first in time” priority rules. See, e.g., California’s Dairy Cattle Supply Lien, Food & Agric. Code 57401-57414; Agricultural Chemical and Seed Lien, Food & Agric. Code 57551-57595; and Poultry and Fish Supply Lien, Food & Agric. Code 57501-57545. These filing and priority rules resulted from efforts by the UCC’s Permanent Editorial Board to bring statutory liens within the UCC’s framework, but only with partial success. Thus, the lawyer’s analysis includes not only spotting the potential statutory lien, but knowing when its risk is manageable or mitigated by the specific lien’s UCC-like searchability and collection priority.

Moving beyond state lien laws, which by themselves are powerful tools in a priority dispute with a conventional UCC lender, federal laws sometimes provide an even more powerful tool. Growers of perishable fruits and vegetables, as well as providers of livestock and poultry, are afforded federal protections under the Perishable Agricultural Commodities Act (PACA), 7 U.S.C. 499, and the Packers and Stockyards Act (PASA), 7 U.S.C. 181. PACA and PASA do not simply create a lien that competes with a UCC security interest; they may actually impose a trust on the farm products, the inventory created from such products and all receivables and other proceeds generated by those perishable commodities and livestock. 7 U.S.C. 499e(c)(2). By placing these products and proceeds in a trust, any purported security interest in the same assets is limited to the residual value after the trust beneficiaries – the unpaid suppliers – are paid. And when assets are subject to a PACA or PASA trust, certain individuals are saddled with the legal duties of a trustee to pay those unpaid beneficiaries, creating strong incentives for the PACA or PASA trustee to do so to avoid personal liability.  See, e.g. Coosemans Specialties v. Gargiulo, 485 F. 3d 701 (2d Cir. 2007).

To quantify the risks posed by these federal statutory trusts, the limits of these statutes and common defenses to them must be understood. For example, the most common questions for the application and extent of the PACA trust include: (1) is the product a perishable agricultural commodity under 7 U.S.C. 499a(b)(4); (2) was the receiver of the produce licensed or otherwise subject to PACA under 7 U.S.C. 499a(b)(6); and (3) did the PACA claimant comply with, or waive the protections of, PACA? A common defense to a PACA claim is that the payment terms exceeded 30 days. 7 C.F.R. 46.46(e)(2). Other more technical disqualifying terms or deficiencies are numerous. But once the lender is aware of the possibility of a federal trust being imposed on the collateral in question, the lender cannot rely upon the prospect of the trust beneficiary’s mistakes to value its own collateral when making underwriting decisions.

In short, an agricultural loan backed by a UCC security interest must be underwritten, sized and subsequently monitored based on the risks posed both by these federal trust statutes and a host of non-uniform, state agricultural liens. A survey of state agricultural liens, PACA and PASA are the subject of entire treatises and beyond the scope of this overview.  (Excellent scholarly papers and 50 state surveys are available from the National Agricultural Law Center, https://nationalaglawcenter.org.) The key for the careful transactional lawyer is to identify the risks and ask the right questions. Because these statutory liens and federal trusts reflect strong public policies, most of these statutory liens and trust rights cannot easily be waived or avoided, but they can be understood and the associated risks managed. In few areas of commerce is this exercise more challenging than agricultural lending to farmers, ranchers and food processors of every type.

Copyright © 2020, Sheppard Mullin Richter & Hampton LLP.
ARTICLE BY Richard W. Brunette, Jr. and Kenneth D. Fox of Sheppard, Mullin, Richter & Hampton LLP

Fraud in Subscription Credit Facilities

Recent press coverage has brought to light allegations of fraud in relation to a subscription credit facility made available to a fund managed by a Florida-based private equity fund manager, JES Global Capital. The allegations claim that one of the managers of JES forged subscription agreements totaling $85 million from two institutions, as well as bank records showing wire transfers from those institutions. An audit letter attesting to the financial health of the fund was also said to be falsified by the manager. The investigation remains ongoing, with the accused manager having been arrested and facing up to 30 years in prison for wire fraud and aggravated identity theft.

How are subscription credit facilities susceptible to fraud?

The case has led to questions about the due diligence processes in the subscription credit facility market. Subscription credit facilities are secured by the unfunded capital commitments of the investors in the fund, the right of the fund to receive capital contributions from such investors and the right of the fund to call capital. In addition, a pledge of the bank account into which the capital is deposited is also typically required. Subscription credit facility lenders conduct due diligence on the fund (as well as its manager) and the investors in the fund, but the key link between the two is the documentation which evidences the investors’ commitments to contribute capital to the fund following the issuance of drawdown notices. Such commitments are documented by subscription agreements or deeds of adherence, whereby each investor agrees to be bound by the fund’s limited partnership agreement and commits to contribute capital up to the amount set out in such documentation. Due diligence reviews are focused on the contents of the contractual framework (i.e. who are the investors, what are their commitments and are there circumstances in which they are not required to honor capital calls) and whether they appear on their face to be enforceable. However, there are limitations around the extent to which a lender can be confident that an investor is committed to a fund through document review alone.

What are the implications when an investor’s commitment to the fund has been forged?

The amount of credit that a lender is willing to extend to a fund is dependent on the amount of the fund’s unfunded capital commitments. It is not clear from the JES case whether the forged commitments were the only commitments to the fund or, alternatively, whether the fund has genuine investors with an actual pool of unfunded capital commitments. Assuming the fund does include genuine investors, by forging investor commitments totaling $85 million, the apparent pool of unfunded capital commitments would be inflated and the amount the lender was willing to advance would be artificially increased.

In the JES case, the key question is who ultimately bears responsibility for repayment of the fund’s debt. If there are genuine investors in the fund, then under typical documentation such investors will be obligated for the debt of the fund on a pro rata basis up to the amount of their unfunded capital commitments. This would depend on the exact wording of the fund’s limited partnership agreement, but it is not unusual for investors to be required to fund drawdown notices without set-off, counterclaim or defense. We expect the lender would have the ability to enforce its pledge and take its own steps to issue drawdown notices to investors to recover the outstanding debt.

On the other hand, if there are no genuine investors (and no amounts available in the pledged bank accounts), the lender is likely to be in an unsecured position vis-à-vis the fund, but may be able to take steps as an unsecured creditor to seek recovery of the debt. This would depend on the extent to which the fund had assets available to meet such debts and/or whether a trustee in bankruptcy could seek to clawback any payments as preferential or fraudulent transfers in an insolvency process. Further, as the general partner of a fund is liable for the fund’s debts, a lender could also attempt to recover from the general partner (although we would typically not expect the general partner to have substantial assets).

How can subscription credit facility lenders mitigate the risk of fraud?

Following the JES case, we expect that lenders will place greater importance on investor due diligence. Given the potential shortcomings in contractual due diligence, this may lead to the adoption of additional due diligence practices. As a practical matter, fund managers may start to see lenders take some of the following additional steps (some of which we already see on some deals but which are not universal and often resisted by fund managers):

  • Requiring letters or acknowledgements to be provided by investors to the lender. Such letters are not generally required by a number of key lenders in the subscription credit facility market, except where lending to funds with concentrated investor bases. Requiring such letters does not eliminate the chance of fraud entirely given that typically the fund manager would be the one liaising with investors to obtain letters or acknowledgements.
  • Requiring notices to be sent to investors informing them of the grant of security. This is standard in European deals given the requirement to give notice to perfect security, but there are differences in approach as to timing and methodology. In US deals, notices are not usually required except for investors in certain jurisdictions, in particular Cayman feeder funds.
  • Requiring evidence that investors have already funded at least one capital call or a specified percentage of their aggregate commitment to the fund before the fund is able to draw under the credit facility. This not only ensures that investors have “skin in the game” before the lender advances funds, but also gives the lender the opportunity to verify bank records. Where the fund’s bank accounts are held with the lender, the verification process is straightforward. However, as demonstrated by the JES case, where this is not the case and the lender relies on the fund to merely provide copies of bank statements of third-party bank accounts, there is still potential for forgery.
  • Spot checks by lenders making direct contact with investors. We aren’t aware of the extent to which spot checks currently take place, but the JES case may lead to lenders considering such checks as part of their due diligence.

Despite the above options open to subscription credit facility lenders, the closest a lender could come to eliminating the risk of fraud would be to make contact with each investor directly to confirm its commitment to the fund as part of the initial due diligence process. Even then, it is possible to envision extreme scenarios where a fraudulent fund manager supplies false contact details and impersonates the investor during the verification process. However, the more additional checks that are built into the due diligence process, the greater the likelihood of detecting fraud before loans are advanced, and the greater the deterrent effect on potential fraudsters. Fund managers may therefore see an increase in lenders employing more rigorous steps in their due diligence processes, with an increased focus on direct contact with investors. On its face, this direct contact is likely to be unappealing to fund managers from an investor relations perspective.

What is the likely fallout from the JES case?

No financial product is completely immune to fraud, and the fact that this is only the second major reported case in the subscription credit facility market suggests that this should not be a cause for panic. Understandably, lenders will be reviewing their due diligence processes and, we expect, requiring additional due diligence, particularly when looking to underwrite new business with a fund or its manager where the lender has no prior existing relationship. It would not be surprising if lenders applied greater pressure on fund managers to maintain the pledged bank account with the lender to assist in the verification steps outlined above (we already see some banks incorporate a soft obligation to do so, but it is not a widespread requirement). The ability of funds with very concentrated investor bases to obtain a subscription credit facility (which is already rare) may become more difficult. Further, investors may begin to take a closer look at the borrowing powers in fund documentation and the circumstances in which they are obligated to fund capital calls to repay fund indebtedness. The fallout from the JES case remains to be seen, but suggestions of increased pricing or requirements to completely overhaul processes on subscription credit facilities appear premature. We will provide further updates as the case develops and the market responds.

© 2020 Proskauer Rose LLP.
ARTICLE BY Ron D. Franklin, Jinyoung Joo and Cameron A. Roper of  Proskauer Rose LLP

Latest Stimulus Package Provides Additional Funding, Expanded Eligibility Under the Soon-to-End Paycheck Protection Program

The American Rescue Plan Act of 2021 (ARP) that was enacted on March 11, 2021, includes additional modifications to the Paycheck Protection Program (PPP). Unlike previous legislative amendments, the changes to the PPP under the ARP are relatively minor, as summarized below.

Slight Increase in Funding Without an Extension to the PPP’s Duration

As previously discussed here, the PPP is set to end on March 31, 2021, and the ARP does not extend the window for borrowers to apply for first or second draw loans, despite calls from borrowers and lenders requesting an extension of the program due to the current backlog of applications at the Small Business Administration (SBA). Reports indicate that hundreds of thousands of applications have been stalled due to processing errors, technical difficulties and a slow implementation of the rules from the last round of amendments to the PPP, and there are concerns that some of the currently pending applications will not be approved by the March 31 deadline. In response to these concerns, Congress is actively considering an extension to May 31, 2021, with the House passing a bill on March 16, 2021 by an overwhelming margin; however, the bill must still clear the Senate before President Joe Biden signs it into law.

Although the ARP includes an additional $7.25 billion for the PPP, bringing total program funding to $813.7 billion, the latest SBA data report on March 14, 2021, indicated that only about $103 billion remained from prior appropriations.

Given the backlog in applications and the relatively small increase in funding under the ARP, borrowers that are interested in applying for a first or second draw PPP loan should submit applications as soon as possible.

Expanded Eligibility

The ARP expands PPP eligibility to certain internet-only news publishers, additional tax-exempt groups, and larger nonprofit organizations.

Internet-Only News Publishers

Certain internet-only news and periodical publishers that previously were ineligible may now participate in the PPP. Specifically, the new eligibility rules include those business concerns or other organizations assigned NAICS Code 519130 (“Internet Publishing and Broadcasting and Web Search Portals”) that meet all these conditions:

  • Do not employ more than 500 employees, or the size standard established for this NAICS code per physical location
  • Certify in good faith that they are internet-only news or periodical publishers and are engaged in the collection and distribution of local or regional and national news and information
  • Further certify in good faith that proceeds of the loan will be used to support expenses at the component of the business concern or organization that supports local or regional news

Tax-Exempt Groups

The ARP also expands PPP eligibility to certain tax-exempt groups listed under Section 501(c) and exempt from tax under Section 501(a) of the Internal Revenue Code, including labor organizations, social and recreation clubs, fraternal benefit societies, and religious educational groups that were previously barred from applying under SBA rules. Sections 501(c)(4) (social welfare organizations) and 501(c)(19) (certain veterans’ organizations) remain excluded under the new eligibility rules. The newly eligible tax-exempt entities may apply for PPP loans if an entity meets all the following conditions:

  • No more than 15% of the entity’s receipts are from lobbying activities.
  • Lobbying activities comprise no more than 15% of the entity’s total activities.
  • The cost of lobbying activities did not exceed $1 million during the most recent tax year that ended prior to February 15, 2020.
  • The entity employs no more than 300 employees.

Larger Nonprofit Organizations

Under prior PPP eligibility requirements, certain large nonprofits, such as Section 501(c)(3) groups, were ineligible if they employed more than the SBA’s size standard for the relevant industry and were previously also subject to the SBA’s restrictions for affiliated entities. The ARP makes some of these larger nonprofits eligible for PPP funding. Specifically, Section 501(c)(3) organizations and veterans’ organizations that employ no more than 500 employees per physical location will now be eligible for PPP loans. In addition, Sections 501(c)(6) organizations, domestic marketing organizations, and Section 501(c) organizations that are tax exempt under Section 501(a) — except for Sections 503(c)(3), 503(c)(4), 503(c)(6), and 503(c)(19) — are eligible to apply if they employ no more than 300 employees per physical location.

COBRA Premium Subsidy Payments Excluded from Loan Forgiveness

Lastly, because the ARP provides COBRA premium subsidies that are eligible for a 100% reimbursement via a payroll tax credit, COBRA premium subsidy payments will be excluded as eligible payroll expenses for PPP loan forgiveness for those PPP loans received on or after March 11, 2021.

Newly and previously eligible first or second draw loan borrowers that need help applying before the March 31, 2021 deadline should contact counsel for assistance before and during the application process.

© 2020 Jones Walker LLP
ARTICLE BY Curtis R. Hearn,  Aimee Andrepont Decuir,
Emily Gauthier and John W. Zimmer, III of Jones Walker LLP
For more articles on the ARP, visit the NLR Coronavirus News section.

In Appreciation: An African American Woman Lawyer on Dewey’s Mob-busting Team

Introduction

As the legal profession addresses issues of diversity, recruitment, and fairness, National Law Review looks back to spotlight the role of an African American woman attorney on Thomas Dewey’s mob-busting prosecution team during the Great Depression. We interviewed Marilyn Greenwald, professor emerita of journalism at Ohio University, about Eunice Hunton Carter. Carter helped convict Charles “Lucky” Luciano in 1936 and later served as a legal advisor to the early United Nations. Professor Greenwald and Yun Li are co-authors of a book on Carter that will be released in April:  Eunice Hunton Carter, A Lifelong Fight for Social Justice (Fordham University Press). Li earned a Master’s degree in journalism from Ohio University in 2016 and is now a reporter at CNBC.

This fascinating look at history explains the role of a legal pioneer and also deals with litigation topics as timely as today’s headlines:  jury selection, the power of the state, preparation of witnesses, and the role of the press.

NLR: The legal profession, media, and other institutions are focused on spotlighting forgotten figures from history, particularly women of color.  How did you learn about/discover the African American woman lawyer on Thomas Dewey’s mob-busting prosecution team?

Answer:  We learned about Eunice Hunton Carter during a visit four years ago to the Mob Museum in Las Vegas, a non-profit museum dedicated to the history of organized crime. The museum features an exhibit about the sensational mob trial of Lucky Luciano during the summer 1936. On the walls are individual photos of Special Prosecutor Thomas E. Dewey and his team of 20 assistant prosecutors, whom the press had labeled the best attorneys in the city. All were men, and all were white – except for one black woman. We knew at the time that there must be an interesting story behind her appointment during an era of stifling racism and sexism, and at a time when very few attorneys were women.

NLR:  June 7, 2021 marks the 85th anniversary of the Lucky Luciano conviction.  What stands out about this case, and the role of Ms. Carter?

Answer:  Carter established the crucial link between prostitution and mob activity — a connection that had been unrecognized by law enforcement officials, and one that ultimately clinched the case. Law enforcement officials in New York City and around the country had been unable to prosecute members of organized crime for actual criminal activity. In Chicago, Al Capone was prosecuted for tax fraud; other mobsters slipped through the legal system entirely. So prosecutors had their work cut out for them. Before she was appointed to the legal team, Carter – the first black female assistant prosecutor in New York – had been working in Manhattan’s Women’s Court, where much of her job consisted of prosecuting prostitutes. After Dewey named her to the team, she remembered that many of the penniless prostitutes she had prosecuted employed high-priced attorneys and bail bondsmen. She theorized that the financial help may have been coming from the mob.

Dewey at first rejected her theory; he didn’t believe it, and thought it would be bad public relations for the team to imply that poor prostitutes were somehow involved with mob activities. After more research by Carter and another member of the team, the theory was borne out. Carter was also instrumental in extracting evidence from the prostitutes and prepping them for their testimony. At first, the women were so intimidated by other tough investigators on Dewey’s team that they wouldn’t speak up. Carter ultimately earned their trust and had them open up so that they would serve as credible witnesses. The testimony of the prostitutes – and what they witnessed – was breathtaking and emotional.

NLR: Dewey and Carter formed a lifelong friendship and professional alliance after the mob trial, even though they were very different personally. How did these differences help the prosecution?

Answer: Carter had a low-key personality and a quiet demeanor. Dewey, who was once a professional singer, was a showman who loved the spotlight.

Carter’s forte was conducting dogged research, often perusing thousands of documents in solitary offices and libraries for weeks at a time. Dewey used his charismatic personality to get information from people and subtly – sometimes obviously—manipulate people and institutions. Dewey, the consummate public-relations man, realized that the legal team could not work effectively under the continual scrutiny of the press and the public. So he met with top editors and publishers to work out a deal – if the newspapers of the era would lighten or eliminate their coverage of the investigation, Dewey would talk to reporters when the probe was completed. The editors agreed, and the actual year-long investigation and the prosecution’s methods got very little coverage in the New York newspapers.

NLR: Dewey was a charismatic prosecutor and he of course won the Luciano case. But wasn’t the team accused of using some questionable tactics?

Answer: Lucky Luciano was convicted of more than 60 counts of compulsory prostitution and sentenced to 30-to-50 years in prison. It marked the first time a New York mob boss was found guilty of a significant felony. Thomas Dewey instantly rose to fame as the nation’s top mob buster.

After the trial, some labor officials and civil libertarians questioned some of his tactics during the investigation. Dewey arrested 100 women in secret round-ups and left them behind bars at the New York House of Detention in Greenwich Village as material witnesses. All the prostitutes were kept in jail while Dewey’s lawyers interviewed them day and night, and sometimes threatened them with prison time if they did not agree to link Luciano to the vice ring. This practice was under scrutiny on cross-examination during the trial. After the trial, some of the prostitutes recanted their testimony, but the verdict was maintained, and a retrial was denied.

Other questionable methods revolved around jury selection and wiretaps. Judge Philip McCook approved Dewey’s request for what was called a “blue-ribbon” jury – a jury made up of middle- and upper-class people, all of whom had served previously on juries. The Luciano jury consisted of 14 white men, many of whom were business executives. Dewey’s team even approached the president of Goldman Sachs to be a juror. All of them had also read about the case in the newspapers, which at the time were overwhelmingly supportive of Dewey, painting Luciano as the nation’s most dangerous and brutal crime lord. Later, research indicated that in more than three-fourths of criminal cases studied, “blue-ribbon” juries voted to convict. The year after the trial, the New York state senate attempted to abolish such juries but they were not ruled unconstitutional in New York until 1965.

Without a court order, Dewey authorized full-scale wiretaps and the tailing of some of the key bookers, which uncovered the inner workings of the prostitution ring. The wiretaps confirmed the fact that many prostitutes had used the same lawyers employed by the mob to get them out of trouble. The liberal use of wiretaps was widely criticized in the aftermath of the trial. The New York state senate also attempted to limit the use of wiretaps shortly after the trial when some labor organizations and civil libertarian groups claimed law enforcement abused their use. These groups argued that evidence gathered from wire taps should be held to the higher standards followed in federal courts. Due in part to a politicized atmosphere – with Republicans including Dewey opposing the proposal and Democrats supporting it – the measure was defeated.

Interestingly, these questionable methods were not brought to light by any of the reporters who covered the case – or, if they were, their controversial use did not appear in published stories.

NLR: How did Thomas Dewey come to know about Carter and her work?

Answer:  In some ways, Dewey was ahead of his time when he hired the team to investigate the mob. For instance, he hired Jewish lawyers on his team at a time when some law firms would not hire Jews. He always maintained that he hired the best people for the job regardless of their race, ethnicity or religion.

In the case of Carter, she entered Dewey’s radar after a brutal race riot in Harlem in 1935 that led to scores of injuries and the arrest of 50. Mayor Fiorello LaGuardia immediately appointed a bi-racial, eleven-person panel to investigate the possible causes of the riot. Carter, who was then a social worker in Harlem, was named as the group’s secretary, assigned to collect tips and evidence and organize the final report. The group concluded that the ultimate cause of the riot was economic inequality, and it marked the first time that black residents spoke about the toll poor housing, unequal education and inferior medical care took on their neighborhoods. Her work – which ultimately resulted in the passing of seven bills in the state legislature – was widely admired, leading to praise from LaGuardia himself. Shortly thereafter, Dewey named her to his team.

NLR: How did Carter manage to succeed as an attorney and prosecutor in a profession that was almost exclusively white and male?

When Carter graduated from Fordham Law School in 1932, there were few white women and even fewer black women in the profession. In 1920, there were about 1,500 female lawyers in the United States and only four were black, according to Ebony magazine.  By 1947, there were 6,615 women lawyers in this country, 83 of whom were black, compared to 174,550 male attorneys.

Carter succeeded in part because she was adept at networking and working to cultivate alliances with other attorneys and with other women who were interested in social justice and civil rights causes. She had always been a member of several attorney organizations, and she was extremely active in the clubwomen’s movement, a reform movement formed in the 19th century devoted to community service and designed to improve the lives of women and families through the promotion of education, health, and women’s suffrage. For decades, Carter was an officer or a board member of the influential National Council of Negro Women, and she served as its legal advisor for many years.

NLR: Besides the Luciano case, how else did Eunice Hunton Carter stand out?

Answer: Carter and Dewey became lifelong friends and associates; after the Luciano case, he was voted New York County prosecutor, and he named Carter head of the office’s Special Sessions bureau, which handled 14,000 misdemeanor cases a year. She worked there nine years before returning to private practice and becoming more active in civic and social-justice causes. A lifelong Republican, she also campaigned for Dewey during his bids for New York governor and U.S. President. Shortly after she left the prosecutor’s office and re-entered private practice, Carter became a legal adviser to the United Nations shortly after its founding in 1945, working with Mary McLeod Bethune and other national educators and reformers.

Copyright ©2020 National Law Forum, LLC

ARTICLE BY Eilene Spear of The National Law Review / The National Law Forum LLC
For more articles on the legal industry, visit the NLR Criminal Law / Business Crimes section.

Paid Social Media Advertising Campaigns for Law Firms: Part 4 Good2bSocial Academy

Last week, we looked at creating an effective law firm social media marketing strategy, the third module in the Good2bSocial Digital Marketing Certification for law firms.  Previously, having an active law firm social media profile as a place to promote firm content was an effective strategy; however, the social media landscape has changed. Due to a saturation of business content on social media networks and shifts in algorithmic preferences, in order to achieve organizational goals and the desired ROI for social media, a paid advertising strategy can help ensure your social media efforts gain traction. Good2bSocial Digital Marketing Academy was developed after years of law firm training and is designed to meet the unique marketing needs of professional services firms and offers paid social media advertising best practices targeted to the needs of legal marketers.

Jay Plum, Director of Communications of Bracewell LLP, says, “The Good2BSocial Digital Marketing Certification program provides current and practical information that is tailor-made for legal marketing professionals at all levels who want to up their digital and social media marketing game.”

Below is a short preview of what’s included in the fourth module of Good2bSocial’s Digital Marketing Certification.

Benefits of Paid Social Media Advertising for Law Firms

A paid social media advertising campaign is an effective strategy offering a variety of benefits.  For example:

  • A paid social media advertising campaign expands your reach beyond your firm’s existing followers; opening up a new audience to educate about your law firm and its abilities.
  • The targeting abilities of social media advertising can allow you to choose who you want to see your content–putting the client persona’s your firm developed (discussed in module 1)  to good use.
  • Most social media platforms run on a pay-per-click budgeting system which simplifies budgeting and helps with cost predictability. Additionally, your firm only pays if the user takes the action you want.
  • With a paid social media advertising campaign, you have flexibility–the campaign can go for as long or as short as you want, and it is easy to stop, start and manage.

How to Get Started with Paid Social Media Advertising

Having a clear objective and understanding of the goals of your social media advertising campaign is a cornerstone of success. Are you looking to expand brand awareness through promotion of a brief introductory video about your firm? Perhaps your goal is to net qualified leads through content marketing, or to promote a webinar or other event designed to showcase attorney expertise? The key is to ensure your strategy is thought-out, and measurable, with a clear idea of what success will look like.

Additionally, creating a budget and having a clear idea of your target audience is crucial. Uncovering the ideal buyer’s persona is a good cornerstone for developing your paid social media advertising campaign.

Through the Good2bSocial Digital Marketing Certification course, legal marketing professionals can learn about the pros and cons of each social media platform, and use that information to help develop their own paid social advertising campaigns. Legal marketers learn about the standard costs associated with Twitter, Facebook, and Linkedin, as well as a look at YouTube and Instagram.  Through the course, students learn about the different targeting options as well as other helpful tools offered through each social network to facilitate targeting. Building on previous segments of the course, students learn to use the information gathered about their law firm’s goals and client profiles to create their own paid social media advertising campaign.

How to Use the LinkedIn Account Targeting Tool

Research conducted by Good2bSocial’s Social Law Firm Index reveals that 37% of AM Law 200 firms are using paid LinkedIn to increase brand awareness and for lead generation, and this number is expected to increase. LinkedIn’s Matched Audience components, Account Targeting is a way to market B2B and integrate Account Based Marketing (ABM) strategies into paid social media advertising. This is a technique that has demonstrated its efficacy–according to ITSMA 85% of businesses indicate an ABM strategy has increased their ROI.

The Linkedin Account Targeting tool is a self-service ad platform that allows sponsored content and sponsored InMail campaigns to be structured to a list of targeted accounts. A user can upload a list of up to 300,000 company names in .csv formats, and Linkedin will cross-reference this list based on the site’s 8 million company pages. An advertiser can go with the information provided by Linkedin, or can refine the list manually.

The Linkedin Account Targeting tool is a self-service ad platform that allows sponsored content and sponsored InMail campaigns to be structured to a list of targeted accounts. A user can upload a list of up to 300,000 company names in .csv formats, and Linkedin will cross-reference this list based on the site’s 8 million company pages. An advertiser can go with the information provided by Linkedin, or can refine the list manually.

Best Practices for Facebook Lookalike Audiences

Facebook also offers a Lookalike Audience tool which takes a current audience, and builds a similar audience based on shared characteristics of individuals who are not currently connected to your organization. By providing Facebook with a prospect or client list, or analyzing engagement on your website, or looking at who is currently following your Facebook or other social media pages, Facebook can take that information and build a campaign to an audience with those shared characteristics.  There are a few options available for building a Lookalike audience, but the effort can pay off with higher Click through rates and ROI. Again, understanding of your buyer’s persona is crucial here, to ensure you are able to effectively harness the power of Facebook’s targeting abilities.

Additionally, in 2018, Facebook announced an algorithm change that would prioritize “meaningful interactions” from friends and family over content from brands. Thus, paid support on Facebook has become crucial part of the mix for firms looking to make a meaningful impact on the platform.

Social media moves fast, and while that’s great for getting results and data, it can be hard to keep up with the changing trends, shifting algorithms and targeting tools. Additionally, creating effective thought leadership is big time and money investment, so harnessing the power of social media to get your desired message out there is crucial. Our goal here was to highlight pieces of the course available, but there is more information available through the Good2bSocial Academy. By going through the Good2bSocial Digital Certification, legal marketers are able to master the fundamentals–and better keep up with the shifting trends and changes in landscape.

To learn more about the Good2bSocial Academy and the law firm-focused topics covered please click here.

To Read Part 1 Good2bSocial Digital Academy for Law Firms – Inbound Marketing and Client Journey Mapping, click here.

To read Part 2 Good2bSocial Digital Academy – Content Marketing Strategy for Law Firms, click here.

To read Part 3 Good2bSocial Digital Academy – Developing a Successful Social Media Strategy for Law Firms

Stay tuned for more details on the topics and key takeaways included in the other six modules of the Good2bSocial Academy.

Copyright ©2020 National Law Forum, LLC
ARTICLE BY Eilene Spear of The National Law Review / The National Law Forum LLC
For more articles on social media advertising, visit the NLR Law Office Management section.

6 Tips for the Lawyer Working from Home

If you struggled with work-life balance before working at home, it can be easy to fall into unhealthy patterns that will burn you out and ultimately sacrifice your quality of work. These six tips for the lawyer working from home can help you be your most productive self while making room to nurture your wellbeing.

Create a Dedicated WorkSpace

A dedicated workspace will set the tone for your productivity and ability to focus throughout the day. It’s best to choose a location in your home that provides ample amount of natural light and a barrier to distractions. Your desk should be clutter free and have enough space for you to work without feeling cramped.

Implement a Work from Home Morning Routine 

Among all of the uncertainties that may arise during the day, your morning routine is one you should strive to consistently complete. You may already have a routine, or maybe you’re wondering how to find the time. It may require waking up a little earlier than usual but it will make a world of difference on how you approach your day. Your routine can be as simple as relaxing with coffee, walking your dog, or doing a quick workout before diving into your day. Check out this blog for more morning routine tips.

Invest in Software and Essential Tools

Long before the pandemic hit, tech companies have been creating a digital world with software that makes your work day flow seamlessly. In fact, technology built in the cloud, like PracticePanther, means you can access it without being in the office or sacrificing on the security of your company’s data. Lawyers working from home shouldn’t have to stress about accessing their data securely.

Implement Online Payments 

Many law firms are still holding onto outdated payment methods, the main culprit tends to be paper checks. Risk averse firms often aren’t familiar with new programs or they’re hesitant to implement them due to policy regulations. However, there are payment software systems that meet the rigorous legal industry’s regulations, and simplify the payment process for lawyers and clients alike. Not only will implementing an online payments system streamline your payments, but you’ll get paid faster and your clients will appreciate the efficient, secure process.

If you’re introducing online payments while working from home, be sure to effectively communicate with your clients the change and the benefits of offering this new payment option. The more educated and confident you are, the more likely your clients will feel comfortable making payments online.

Communicate with Clients

You likely have a variety of clients with varying levels of comfort when it comes to utilizing new technology or software. To limit unnecessary frustration, lawyers working from home should create a communications plan and send it to their clients. The communications plan should answer the following questions:

  • How long will you be working from home?
  • What are the different channels of communication you can be reached at?
  • What are your office hours?
  • How can I make payments?

Creating this plan will show your clients that you are committed to providing quality customer service while working from home and diminish any uncertainties they may have. Additionally, this plan will act as a way for you to set boundaries with your clients and stick to your routine.

Take Breaks

It’s very easy to fall into a cycle while working from home where it seems like there is no way to disconnect. Each day you will have to make a conscious decision to schedule breaks. Whether it’s cooking a quick nutritious meal or walking your dog, taking time for yourself is important and will limit burnout.

This article was written by Kamron Sanders.

© Copyright 2020 PracticePanther

ARTICLE FROM THE Practice Panther Blog
For more articles on the legal industry, visit the NLR Law Office Management section.

American Rescue Plan Act of 2021: Tax Reports

President Biden signed the American Rescue Plan Act of 2021 (the “ARPA”) on Thursday, March 11. The legislation is one of the largest economic stimulus plans in U.S. history. Providing for approximately $1.9 trillion in federal spending, the ARPA contains an array of economic assistance programs, including continued direct payments to Americans, extended jobless benefits, funding for coronavirus testing and vaccine distribution and an infusion of cash to state and local governments. The ARPA also contains significant anti-poverty measures and various benefits for low-income Americans. As with previous coronavirus-related stimulus packages, many of these benefits are provided via temporary and permanent changes to the U.S. tax system. This Tax Report summarizes the significant tax provisions of the Act.

Child Tax Credit

The ARPA made significant changes to the Child Tax Credit (“CTC”) which may be worth as much as $3,600 per child for tax year 2021. Under the CTC in effect for tax year 2020, (i) the CTC was $2,000 per dependent child under the age of 17, (ii) the CTC did not begin to phase out until a taxpayer’s adjusted gross income reached $200,000 (and $400,000 for a joint return) and (iii) only up to $1,400 of the CTC was refundable and could only be obtained if the taxpayer earned income of at least $2,500. These final two limitations on the CTC have been historically criticized as being disproportionately burdensome for lower-income individuals who presumably need the benefit of the CTC the most.

Under the ARPA, for tax year 2021 the CTC has been increased to $3,600 per child under the age of 6, and $3,000 per child ages 6 through 17 (the CTC previously applied only to children under 17). The credit is also fully refundable (the refundable amount was limited to $1,400 in 2020), and the $2,500 earned income requirement has been eliminated. Further, those eligible for the CTC will enjoy some of the cash benefit of the CTC this year as opposed to realizing receiving cash only when filing their tax return in the spring of following year, as had been the case prior to the ARPA. More specifically, the IRS will make monthly payments from July 2021 through December 2021 amounting to ½ of the CTC, and the remaining half will be realized when claimed in the spring of 2022 when the taxpayer files the 2021 tax return.

Finally, the CTC will effectively have 2 sets of phase-outs. The expanded CTC benefits added by the ARPA begin to phase out for taxpayers with an adjusted gross income of $75,000 ($150,000 for a joint return). However, those who do not qualify for the expanded benefits are still eligible for the CTC under the same rules applicable to 2020, meaning they can receive up to $2,000 per child with the higher phase-outs covered above ($200,000 for single, and $400,000 for joint returns). For now, the expanded benefits of the CTC are only available for 2021. Unless extended, the rules for 2022 will revert back to those in place for 2020.

Child and Dependent Care Credit

The ARPA made several modifications to the Section 21 of the Internal Revenue Code of 1986, as amended (the “Code”) which governs the child and dependent care tax credit. Like the changes to the CTC, changes to the child and dependent care credit are effective for tax year 2021 only. The ARPA raises the dollar limit on employment-related child and dependent care expenses from $3,000 to $8,000 for one qualifying individual and from $6,000 to $16,000 for two or more qualifying individuals. In addition, the maximum reimbursement percentage is increased from 35% to 50%. Consequently, the maximum allowable credit amount has been increased to $4,000 for one qualifying individual and $8,000 for two or more qualifying individuals. This 50% maximum credit amount is reduced, to a floor of 20%, by one percentage point for every $2,000 that a taxpayer’s adjusted gross income exceeds $125,000. For taxpayers with adjusted gross income in excess of $400,000, the 20% maximum credit amount is further reduced for every $2,000 of adjusted gross income in excess of $400,000 until the credit is fully phased out.

Student Loan Debt

Relief for taxpayers with student loan debt has been a common target of previous COVID related stimulus packages. Federal student loans have been in a forbearance period since March of 2020 (scheduled to continue until October of 2021). The Biden Administration is also expected to move to cancel some portion of existing federal student loan debt, though it is unclear what amount will be cancelled or when such a move will be made. Continuing along this path, the ARPA provides further relief for those with student loans by temporarily changing the income tax treatment of student loan debt cancellation. Under prior law, any amount of private or federal student loan debt that is cancelled or forgiven is treated as gross income for the debtor. The ARPA amends Code Section 108(f) to exclude any amount of private or federal student loan debt forgiven after December 31, 2020. Notably, however, the ARPA did not make this change permanent and the revision to Code Section 108(f) is scheduled to sunset as of January 1, 2026.

Stimulus Checks

The ARPA authorizes a third round of stimulus payments up to $1,400. Like previous stimulus payments, the $1,400 payments are excluded from taxable income. This round expands the eligibility for certain dependents of eligible taxpayers from children under the age of 17 to all dependents in the household. The stimulus payments are subject to certain limitations with respect to a household’s adjusted gross income. Households with adjusted gross income of more than $80,000 for single filers, $120,000 for head of household filers, and $160,000 for married filing jointly will not receive any payment. For taxpayers with adjusted gross incomes below those respective limitations the stimulus is subject to a phaseout beginning at $75,00 for single filers, $112,500 for head of household, and $150,000 for married filing jointly.

Earned Income Credit

For the tax year 2021 only, the ARPA will increase the availability of the earned income tax credit (“EIC”) for childless households, effectively making more taxpayers eligible to claim the EIC. Pursuant to the ARPA, individual taxpayers (with no qualifying children) will see changes to the computation of their EIC, including increases in (i) the phase-out percentage, (ii) the earned income amount, and (iii) the phase-out amount. Also, the maximum EIC amount for childless households, will increase from $540 to $1,500. Moreover, the age range for the EIC recipients has been broadened. For childless households, individual taxpayers will be able to claim the EIC beginning at age 19 (instead of age 25), with the exclusion of certain students ages 19 to 24. Further, the upper age limit of 65 years will be eliminated and the EIC will not be subject to an upper age limit. For purposes of calculating the 2021 EIC, individual taxpayers may choose to use their 2019 income if it was higher than their 2021 income.

For all future tax years, including tax year 2021, married individual taxpayers who are separated may be treated as not married for the purpose of the EIC if, and only if, such married individual taxpayers do not file a joint tax return. This change applies only if the individual taxpayer (who is claiming the EIC) lived with a qualifying child for more than one-half of the applicable tax year and also did not have the same principal residence as the spouse for at least six (6) months of the applicable tax year. In addition, individual taxpayers who otherwise would be eligible to claim the EIC, but whose children do not have social security numbers (SSNs), will now be permitted to claim the EIC available to childless households.

Unemployment Compensation Benefits

Although unemployment compensation benefits are normally includable as taxable income, retroactive for the 2020 tax year only, the ARPA has made the first $10,200 of income from unemployment compensation benefits tax-free for individual taxpayers with incomes of less than $150,000 for the 2020 tax year. How this tax benefit will be claimed and applied is subject to further instructions or guidance to be issued by the Internal Revenue Service.

Employee Retention Credit

The Employee Retention Credit (the “ERC”) under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which was originally scheduled to expire on December 31, 2020 and was extended by the Consolidated Appropriations Act, 2021 (the “CAA”) until June 30, 2021 (see our prior Alert). The ERC is extended under the ARPA to cover qualified wages paid through December 31, 2021. In addition, the ARPA provides the following changes to the ERC rules:

  • Expansion of ERC eligibility to “recovery startup businesses” which is defined as employers that (i) commenced operations after February 15, 2020, (ii) have gross annual receipts of less than $1 million, and (iii) otherwise don’t satisfy the ERC eligibility requirements. The ERC is capped at $50,000 per quarter for “recovery startup businesses.”
  • Expansion of ERC eligibility to “severely financially distressed” employers (even those with more than 500 employees) which is defined as employers that are experiencing a gross receipts reduction of more than 90% as compared to the same calendar quarter in 2019.
  • As a reminder, the CAA increased the amount of the ERC from 50% of qualified wages to 70% of qualified wages paid per calendar quarter (this was not increased by the ARPA). Thus, eligible employers may now claim up to $28,000 per employee in 2021.
  • The ERC may now be claimed against the employer’s share of Medicare tax (1.45%).

Revenue Raising Changes

The ARPA also includes certain Code changes designed to raise federal revenue to offset some of the cost of the forgoing stimulus measures.

Code Section 162(m) limits the deduction that a publicly held corporation can take with respect to compensation paid to its “covered employees” to $1 million per year. Generally speaking, a “covered employee” means the corporation’s principal executive officer (“CEO”), principal financial officer (“CFO”), and its three other highest compensated officers for the taxable year. Beginning with tax years commencing on or after January 1, 2027, the ARPA expands the number of “covered employees” to include the CEO, the CFO, and the next eight highest compensation employees of the publicly-held corporation (i.e., an increase in five covered employees). The Joint Committee on Taxation (the “Joint Committee”) estimates that the expansion of the Code Section 162(m) limits will raise $7.8 billion over 10 years.

The ARPA also permanently repeals the worldwide interest allocation rules of Code Section 864. These rules were initially adopted in 2004 as part of the American Jobs Creation Act and were intended to limit the extent to which interest expenses of a U.S. parent company are overallocated to foreign subsidiaries, which can cause an unintended reduction in foreign tax credits available to US parent companies. Since the enactment of these rules, Congress has consistently delayed their effective date and used such delay as an offset to other tax cuts. The ARPA effectively makes those prior delays a permanent repeal. The Joint Committee estimates that the repeal of the worldwide interest allocation rules will raise $22.3 billion over 10 years.

In addition, the ARPA extends the Code Section 461(l) excess business loss rule that limits certain current losses attributable to trades or businesses of noncorporate taxpayers to $250,000 for individual filers and $500,000 for joint filers. The limitation was enacted under the Tax Cuts and Jobs Act of 2017 (the “TCJA”) but was suspended by the CARES Act for tax years 2018, 2019 and 2020. As originally enacted under the TCJA, the limitation was set to expire at the end of tax year 2025. The ARPA extends the limitation through tax year 2026. The Joint Committee estimates that the extension of the excess business loss rule will raise $31 billion over 10 years.

Copyright ©2021 Nelson Mullins Riley & Scarborough LLP

ARTICLE BY Matthew R. Zischke, Chip Gray,
Nathaniel G. Dutt, Bobby Streisel, Drew Hermiller and C. Wells Hall, III of Nelson Mullins
For more articles on the American Rescue Plan, visit the NLR Coronavirus News section.

Law Firm SEO: Top Search Engine Optimization Strategies for Lawyers

For most people, Google is their go-to search tool for finding legal services. Being the largest search engine online today, Google is a significant source of leads for law firms and practicing attorneys.

But ranking high in the Google search results is not always an easy feat. You need Search Engine Optimization to improve your law firm website, increase your rankings, and attract new leads in droves.

The good news is that SEO for attorneys is made simple with the right strategies.

In this comprehensive SEO for lawyers guide, you’ll learn:

  • What search engine optimization is (and why it matters)
  • The fundamentals of law firm SEO
  • On-site SEO tips for lawyers
  • How to conduct SEO keyword research
  • How to write legal content for your blog
  • The essentials of local SEO for law firms
  • Top link building tactics for law firms

Want to improve your Google rankings and drive more clients to your website? Let’s dive in.

What is Search Engine Optimization?

Search Engine Optimization (SEO) is a type of digital marketing that works to help businesses and websites attract more visitors from search engines like Google, Bing, and Yahoo. Specifically, law firm SEO is the practice of using data-driven tactics to attract more prospective clients online.

Prospective clients turn to search engines (namely, Google) to search for legal services, find a lawyer in their area, read law firm reviews, and compare their options. Law firm SEO helps lawyers stand out online, making them the obvious choice ahead of their competitors.

Why is Law Firm SEO Important?

SEO is a powerful marketing tool in helping law firms attract more clients online. Not only can SEO help your law firm rank higher in the search results, but it can increase website engagement and generate more leads for your business.

Ranking at the top of search doesn’t happen overnight, and it usually doesn’t happen without some intervention on your part to improve your site’s SEO. That’s why it’s important to invest in SEO strategies early on to increase your chances of ranking above your local competitors.

Benefits of SEO for Lawyers

There are a variety of benefits that come from using search engine optimization on your website. These benefits can include:

  • Attracting more users to your law firm’s website
  • Increasing your visibility in local search
  • Generating more positive reviews for your business
  • Increasing engagement on your website
  • Converting website visitors into potential clients
  • Attracting high-quality backlinks to your site
  • Ranking above your competitors
  • Tapping into new service areas and markets
  • Creating a holistic content strategy to reach more users

The benefits of SEO don’t stop there. If you want to attract more clients to your law firm on a consistent basis – and improve your digital marketing overall – it’s worth it to get started with SEO.

Does My Law Firm Need a Website for SEO?

The legal industry is highly competitive, which means law firms need to do everything they can to stay ahead of the competition. While it’s possible to attract clients without a website, it’s highly recommended that you have one in order to get the most out of SEO.

Having a website gives you a platform to optimize your business for Google search and provides a medium through which potential clients can contact you. It also gives you a place where you can publish content, post client testimonials, and provide clients with information about your firm.

Having an attractive, search engine optimized website can make a huge difference when it comes to getting your law firm noticed online.

The Fundamentals of Law Firm SEO

There are essentially four essentials that are required for a successful SEO strategy. These include:

  1. Technical SEO
  2. Content
  3. Link Building
  4. Local SEO

Technical SEO

Technical SEO involves the technical optimization of your website, including the site structure, navigation, load speed, and link structure. Without a fast, functional, and user-friendly website, no amount of content or backlinks will be enough to maximize your rankings.

To have a technically-sound website, your site must:

  • Be optimize for mobile devices (smartphones and tablets)
  • Be indexable by search engines (by having an optimized sitemap)
  • Be secure; having an updated SSL certificate
  • Avoid broken links and 404 pages
  • Be easy to navigate
  • Have a fast load time (under 3 seconds)

Technical SEO is arguably the most complex part of SEO, as it requires some knowledge of website management and development. When optimizing your law firm website, it may be best to work with a technical SEO expert and/or web developer the handle the technical optimization of your site.

Content Marketing

In the SEO world, content is king. It’s virtually impossible to have an informative, user-friendly website without content. With that in mind, your law firm website should have web pages and blog articles that contain valuable content that’s both written for your target audience and optimized for search engines.

Link Building

Backlinks occur when another website or online platform links to your website. When reputable, authoritative websites link to your site, this can boost your own site’s authority. This is a plus in the eyes of Google, as Google’s algorithm strives to show high-authority sites to users.

Link building is the practice of driving links to your website, through a variety of methods.

The key thing to keep in mind is that you should be working to earn high-quality links, not just a massive volume of links. It’s best to earn these links organically or through outreach rather than through buying links from a vendor.

Local SEO

Local SEO is a type of SEO that’s unique to local businesses. This is because local businesses serve specific geographical areas and, therefore, their potential customers are often using geo-specific terms to find services in their area.

For example, someone is more likely to search for “family lawyer in Seattle” than simply “lawyer” or “attorney”, because they know they need a lawyer in their area. So, law firms then need to use these localized terms in their content, as well as build out their local online listings (such as on Google My Business, Bing Places, and the like).

Google Ranking Factors for Law Firm Websites

The top Google ranking factors are essentially the same for law firms as they are for any other type of business, aside from local SEO. “Ranking factors” are essentially the elements Google’s algorithm looks for when determining whether (and how) it should rank a website.

Your goal as a law firm business owner is to try and tick off all of these boxes. If your site includes all of these top ranking factors, you’re well on your way to having an optimized site that ranks above your competitors.

These top ranking factors for Google include:

  1. Having a secure and accessible website
  2. Passing Google’s Page Speed and Mobile Page Speed tests
  3. Being optimized for mobile devices
  4. Your website’s domain age and authority
  5. Having optimized web content
  6. Tackling your technical SEO
  7. Optimizing for User Experience (UX)
  8. Having high-quality backlinks

How to Conduct Keyword Research for Law Firms

Before you can start optimizing your site for certain search terms, you need to figure out what those terms should be. Keyword research involves identifying what key terms your potential clients are searching for when looking for businesses like yours.

Many lawyers assume that their target audience is searching for keywords like “lawyer” or “law firm”, but this is not necessarily the case. You need to conduct thorough, data-driven keyword research to find the right terms, as well as uncover their search volume and competition level.

1. Use SEO keyword tools

Lawyers can use SEO keyword research tools like Ahrefs.com or SEMRush.com to find keywords. These tools not only show you how much search volume a keyword gets, but also how difficult it will be to compete for it.

Use these tools to research your own initial keyword ideas, find related keywords, and spy on your competitors’ keyword strategies. Knowledge is power, and having the best data on your side will only help your SEO strategy become stronger.

2. Brainstorm searchable key terms.

Sometimes it’s best to simply start with a brain dump of keyword ideas that might apply to your website. Consider:

  • The types of services you offer
  • How you would describe your business in a few words
  • The types of clients you work with
  • The results you’ve generated for clients
  • What your competitors are targeting
  • Your service area(s)
  • The questions your potential clients are likely asking

For example, a personal injury attorney in Los Angeles is likely to think up search terms like:

  • LA personal injury attorney
  • LA personal injury lawyer
  • Personal injury lawyer LA
  • Personal injury law LA
  • Los angeles pi lawyer
  • Who to call after an accident
  • Car accident lawyer LA
  • Personal injury law services
  • What does a pi lawyer do

The above terms are all potential keywords you could search for using your chosen keyword research tool. Over time, you’re likely to add to this list by discovering related terms and other keywords you’d like to target on your website.

3. Consider localized keywords.

In the previous example, you saw some keyword options that included localized terms like “LA” and “Los Angeles”. If you are a law firm that targets specific service areas, then you will want to identify localized terms as well.

See if you can find key terms for each of the areas you serve. Look for variations of these localized terms, such as “LA”, “Los Angeles”, and “Los Angeles, CA”. It’s best to target these terms so your law firm is able to compete locally versus at a more competitive, national level.

4. Identify related keywords.

Once you search for the key terms in your chosen SEO keyword research tool, you can use the tool to find “Related Keywords”. This is a great way to find terms you might not have thought of before. If they seem like a good fit for your site, add them to your list.

5. Scope out your competitors’ keywords.

Finally, you can use those same SEO tools to search your competitors’ domains and see which keywords they are targeting. You are likely to find some interesting phrases you might want to target on your own site. These terms can then be applied to new web pages or blog articles.

On-Site SEO Tips for Lawyers

On-site (or “on-page”) SEO involves optimization that occurs on your website (as opposed to optimizing your other online profiles or building backlinks). On-site SEO is important because your website serves as essentially the foundation of your entire SEO strategy.

Fortunately, on-page SEO tends to be the most accessible form of SEO and therefore the easiest for lawyers to implement on their own.

Here are a few tips for optimizing your website:

  • Use your focus keyword in the title tag of your page. Your title meta tag is one of the strongest signals that search engines look out for.
  • Include your keyword(s) in the meta description of your page or post. This description should accurately (and concisely) explain what the content is about.
  • Include your keyword in your H1 tag. This is the “title” that appears when you visit the web page or blog post.
  • Use keywords throughout your page copy. In writing a web page or article, your content should thoroughly cover the topic and naturally include your target keyword, as well as related keywords.
  • Optimize your page/post length. Look at the top-ranking pages or articles for your target keyword and try to write content that’s around the same length. Ideally, your content should provide more value than what’s already ranking.
  • Avoid duplicate content. The content on your web pages should be original, and you should avoid using the same content across multiple pages.
  • Optimize your images by reducing the file size, including a descriptive file name, and adding optimized (descriptive) image alt text. Only use original images or graphics, or royalty-free images, to avoid copyright issues.
  • Fix broken links by setting up 301 redirects. Avoid changing the URLs of your pages or posts unless absolutely necessary. Have a user-friendly 404 page that directs users to other pages of your site if they encounter a broken link.
  • Add internal links within your content to other pages and posts on your site. This helps users find the information they’re looking for and keeps them on your site for longer.

How to Write Legal Content for Your Blog

Your law firm website should contain optimized web pages that describe your services, but you should also have blog articles that draw in potential clients. Beyond your Home, About, Contact, and service pages, blog articles work to attract a wider audience and provide value to users.

This is where you can get a bit more creative with your content ideas. Brainstorm some topics and then use keyword research tools to determine whether any of these terms have search volume. Then you can turn them into blog posts.

For example, some interesting legal blog post ideas include:

  • “X Things to Look for When Hiring a Y Lawyer”
  • “X Things to Do Before Filing for Divorce”
  • “X Steps to Filing a Personal Injury Claim”
  • “What to Do if You Get Injured on the Job”
  • “X Steps to Settling a Child Custody Dispute”
  • “Complete Guide to X Law for [Audience]”
  • “What You Need to Know About [State]’s New X Law”
  • “Need a X Lawyer? Here’s How to Choose the Best One for You”

Once you have a topic in mind – and have confirmed that there is search volume for this topic – you can write an informative blog post. Then, follow on-site SEO best practices to ensure your post is optimized for search engines. Again, this includes:

  • Using the focus keyword in the title tag
  • Writing an optimized meta description
  • Using your target keyword(s) throughout the content
  • Adding descriptive H2 headings
  • Adding internal links
  • Including original, optimized images

Local SEO Essentials for Law Firms

As a local service business, your law firm needs local SEO in order to rank high in local search. This not only involves using localized keywords on your website, but also optimizing your local online listings.

Google My Business

Google My Business (GMB) is a free platform that allows businesses to create online profiles to drive traffic and attract customers/clients. You can claim an existing listing or create a new one. Best practices for optimizing your GMB listing are to include your business name, address, phone number, hours, and website link, add images to your profile, and generate positive client reviews.

Online Directories

There are a variety of reputable online directories that allow law firms to post their business information. This is a good way to generate traffic, attract clients, and, sometimes, earn a backlink. Some of the top legal directories include Avvo, FindLaw, BBB, eLocal, Superpages, Yellow Pages, Bing Places, and Yelp.

Localized Content

While it can be difficult to find localized keywords that relate to the services you offer, it’s still worth it to try and create localized content for your niche. This might include topics like “Best Lawyers in [ Area ]” or even something more broad like “X Businesses That Are Serving the Community in [ Area ]”.

You should use your geo-specific keywords throughout your content and be on the lookout for more localized keyword opportunities. This would be a good time to scope out what your competitors are doing and see if you can tackle any of these topics on your own site.

Link Building Strategies for Law Firms

The last “essential” of law firm SEO is link building, which involves earning links back to your website. There are many organic methods you can use, but this can be quite a competitive endeavor, especially in the legal niche.

Some of the most common law firm link building strategies include:

  • Creating linkable assets (blog articles, guides, ebook, etc.) that sites will link to organically
  • Conducting outreach to niche websites to earn links directly
  • Guest posting on other websites in exchange for links
  • Posting your business information to online directories
  • Creating white papers, case studies, and “ultimate guides” you can circulate to other platforms

Link building can get a bit tedious, but it is worth it when it comes to the authority you can earn for your site. Need more ideas? Check out this post on 8 link building ideas for law firms.

Law Firm SEO Made Simple

Law firm SEO can seem complicated, especially if you’re new to this type of digital marketing. But with the right strategies, you can start taking steps today to improve your SEO over time. SEO is a marathon, not a sprint, and now’s the best time to get started to set your site up for long-term growth.

By implementing on-page SEO, technical SEO, content marketing, local SEO, and link building, you’ll be well on your way to having an optimized law firm website. Over time, you’ll increase your Google rankings, generate more traffic, and, hopefully, attract more clients to your firm.

Copyright 2020 © Hennessey Digital

ARTICLE BY Jason Hennessey of Hennessey Digital
For more articles on law firm SEO, visit the NLR Law Office Management section.

How Law Firms Are Supporting Women Lawyers in The Pandemic

This year’s celebration of Women’s History Month is especially appropriate because it comes during the one-year anniversary of the COVID-19 shutdown. Working women have felt a tremendous amount of pressure in juggling demanding careers with the unprecedented challenges of the pandemic, especially closed childcare facilities and schools and eldercare.

The American Bar Association conducted a survey to understand the impact of the pandemic on the legal profession, particularly on women and diverse lawyers. It uncovered concerning data that all law firm leaders must consider going forward: Just as client demand for diversity is hitting an all-time high, the pandemic may force women to leave the workforce.

“The findings may forecast an exodus from the profession at a time when clients are demanding diverse talent,” noted Roberta Liebenberg of the Red Bee Group, which designed and managed the survey. The ABA presented findings of the survey, conducted in fall 2020, on February 17 at its virtual 2021 midyear meeting.

Since COVID-19 began, women have been exiting the workforce at higher rates than men, according to the Bureau of Labor Statistics.

These reports suggest that even greater challenges lie ahead for women lawyers as our country and our businesses begin to emerge from the pandemic.

Jaffe spoke with several law firms around the country about the impact of the pandemic on women lawyers and how their women’s programs have been helpful over the past year.

Women’s Initiatives and Pandemic Support

One positive and effective way that many law firms support their women lawyers is through women’s initiative programs or groups, which offer opportunities for women at any stage of their careers to connect, mentor and educate each other.

Women of Moore & Van Allen (WoMVA) chair Meredith Reedy said that the pandemic, while affecting working parents overall at the firm, has had an especially strong impact on working mothers. “Whether juggling work and young children or aging parents, women tend to take the brunt, intentional or not,” she said.

WoMVA brings together female professionals at the firm for mentoring, networking and career development opportunities. The group is devoted to promoting the interests and progress of women lawyers and non-legal professionals, including through efforts to promote women to leadership positions in the firm and the community.

She credits the firm for being flexible over the past year, but points to a common flaw she has noticed affecting all women lawyers. “We need to be better at creating boundaries between home and work. Work is always there,” Reedy said.

Melissa Ebel, co-chair of the professional development initiative Women of Eastman & Smith (WES) at the law firm Eastman & Smith Ltd., said the pandemic was a huge adjustment for attorneys who found themselves providing legal services while caring for young children, facilitating remote education for school-aged children or both.

Ebel, a mother to three children under age 5, needed a leave of absence to care for them. “The firm was fantastic,” she said. “My partners assisted in serving our clients; once my children’s childcare re-opened, I was able to gradually, and relatively seamlessly, return to my practice.”

WES, whose members are also members of the firm’s management team, took an important step toward advancing awareness of gender equality and equity issues within the firm last year, when the firm adopted a 12-week paid parental leave policy for all employees, regardless of gender, who need time to care for the birth, adoption or foster placement of children.

In addition, WES has enhanced the firm’s mentoring program for women attorneys, helping women associates develop and establish relationships with more-senior attorneys.

“Our need for WES to transition to virtual programming due to COVID-19 resulted in increased attorney attendance and participation,” Ebel said. “Each month, different WES members team up and decide on the theme of the programming. The goal is to provide our women attorneys with opportunities to share ideas, foster internal relationships, expand contacts and build leadership skills.

Lori Wisniewski Azzara, chair of the Women’s Initiative at the law firm Cohen Seglias Pallas Greenhall & Furman PC, said the firm has learned that attorneys can still be productive without being in the office. “As a result, the firm instituted a remote work policy for all attorneys, which provides attorneys with the option to work one day per week from home once our offices reopen,” she said. “This added flexibility is beneficial for our female attorneys, particularly those with younger children or those in caregiver roles, because it allows for balancing home and work demands on a more-convenient schedule.”

“Because many state and national events and conferences were being conducted virtually, we were able to broaden the number of female attorneys at our firm who could attend meetings,” said Azzara, noting another opportunity the pandemic offered for greater participation and engagement.

Mollie Farrell, Greensfelder’s Director of Professional Development, works with Women’s Connect, the firm’s internal initiative that organizes social and professional development opportunities to connect women attorneys across all offices and practice areas. She explained how the firm’s partnership with a community provider helps to ease stress and worry for firm employees when having to manage eldercare.

“One important priority has been to support caregivers, whether that is parents or others who are caring for elderly or sick family members,” Farrell said. “In 2020, the firm began partnering with Homethrive, a family elder care coordinator, to offer all of its employees a fully covered family caregiver service benefit as part of the firm’s broader benefits package. Through this new partnership, we have additional programming and support available to attorneys and staff.”

Farrell also pointed to the need for clear, consistent communication from firm management. “It has been important for employees at all levels to hear the message from top leadership that they are supported in their need for accommodation, whether that is related to their personal working situation, a need for family leave or other struggles,” she said.

Sanity and Service During the Pandemic

Women’s initiatives at law firms understood the need for socializing, albeit distanced, to maintain relationships and sanity during the pandemic.

While WoMVA’s biannual retreat had to be cancelled last fall, the group kept to a fairly normal level of activity, with programs such as a virtually guided wine and cheese pairing tasting, and an online holiday party.

One new effort that has been particularly well-received was the launch of the WoMVA book club. The women meet quarterly for meaningful discussion about a book’s relevance to their personal and professional lives, alternating between fiction and nonfiction reading choices, while catching up with one another. The book club cultivates cross-team relationships, which expands female attorneys’ professional and personal networks within the firm.

Women of Eastman & Smith (WES) did not slow down its service during the past year. Focusing on the importance of literacy, WES held an internal book drive in June 2020 to collect books to donate to a local nonprofit that assists low-income parents with how to prepare their children for kindergarten. WES collected more than 150 books from attorneys and staff to donate, tripling their initial goal.

At Cohen Seglias, Azzara said she hopes the Women’s Initiative will use 2021 to reconnect, both internally and with clients. “Our programing this year will focus on bringing us together and providing opportunities to engage with our clients, even if we are still operating in a virtual setting,” she said.

Maternity Leave

Pending motherhood brings unique challenges, and several firms provide formal support. WoMVA’s Advocate Program pairs expecting and new mothers with an internal advocate to help them at the firm with their transition to parental leave, and when returning to the firm. “This program has been especially helpful during the pandemic,” Reedy said.

Cohen Seglias recently implemented a ramp-down/ramp-up policy. “This provides new mothers with some breathing room and flexibility in their billable hour requirement as they prepare for and adjust to motherhood,” said Azzara. “The firm strives to support its female attorneys during this process, and this policy furthers that goal by providing an opportunity for the attorney to be successful, both personally and professionally.”

Women’s History Month

In recognition of International Women’s Day and Women’s History Month, these firms undertook different approaches to honor the women at their firms.

WoMVA invited all firm employees to a webinar, “How Men Can #ChooseToChallenge Gender Inequity in Law,” with a panel of business leaders and change-makers who addressed the role of men in advancing gender equality in the workforce, especially in the business of law.

Another firm accepted the #ChooseToChallenge theme. Eastman & Smith’s managing partner called on all attorneys and staff to work together to ensure the firm provides a culture where all are welcome, included and empowered to succeed, and provided a forum to discuss the firm’s commitment to creating an inclusive work environment.

Cohen Seglias is posting a daily feature in March about each of the firm’s female attorneys and leaders on its social media pages. With a significant presence in the construction industry, the firm also spotlights its female attorneys who practice in construction, since March also includes Women in Construction week.

The Women’s Connect group at Greensfelder undertook a new project this year to reach out directly to all of the firm’s women attorneys and have one-on-one phone conversations with as many as possible. The discussions served two purposes: to interview each attorney and learn a bit more about their personal and professional backgrounds, and to delve into how they feel about the firm and how Women’s Connect can best support them.

“That information is now being used in multiple ways, including for mini-profiles of each interviewee to be shared internally throughout March and as the basis for external messaging for International Women’s Day,” said Farrell. “Most important, it is serving as background knowledge to inform the Women’s Connect leaders and other firm leadership about ways they might consider enhancing their support for women. This has been a valuable and much-needed way to rebuild some of the personal connections that may have lost momentum during remote-work time and to remind people that their voices are important and heard.”

Women’s initiative groups at law firms are crucial to providing women lawyers of all ages with ways to feel empowered about their careers, professional relationships and work environments. As law firms have had to become more empathetic to the work-life balance and enable greater flexibility, women’s programming must remain a priority for women lawyers to succeed on all fronts as a new “normal” emerges.

© Copyright 2008-2020, Jaffe Associates

ARTICLE BY Vivian Hood of Jaffe
For more articles on the legal industry, visit the NLR Law Office Management section.

Sanctions and Export Control Developments in the First 50 Days of the Biden Administration

As the calendar flipped past the 50th day of President Joe Biden’s administration on March 11, 2021, a survey of economic sanctions and export control-related developments shows where the Administration felt a pressing need to impose new sanctions, alter existing policies or, in several areas, clarify existing programs. To date, we have not seen substantial changes to any ongoing sanctions programs by the Biden Administration, but we will be watching complex hot spots such as China and Iran as the Administration works through the nuances of its foreign policy and deepens its diplomatic efforts over the coming weeks and months. In this bulletin, we share our thinking on these early developments with our clients and friends to help you keep your sanctions programs current and monitor shifting risk levels posed by your international operations.

Sanctions Map

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Africa

Democratic Republic of the Congo and Mozambique

The Biden Administration advanced the long-standing sanctions program against foreign terrorist organizations operating on the African continent with the designation by the Department of State of two affiliates of the Islamic State, one each in the Democratic Republic of Congo and Mozambique, as “foreign terrorist organizations,” adding them to the Office of Foreign Assets Control’s (“OFAC”) Specially Designated Nationals (“SDN”) List and subjecting them to broad sanctions. Allied Democratic Forces (also known as ISIS-DRC (“ADF”)) and Ansar al-Sunna (also known as ISIS-Mozambique) are believed to be responsible for multiple attacks on civilians and government security forces that have killed thousands of people in south and central Africa since 2017.1 The Department of State also designated ISIS-DRC, ISIS-Mozambique, and their leaders Seka Musa Baluku and Abu Yasir Hassan as Specially Designated Global Terrorists under Executive Order 13224. The leader of the ADF, Musa Baluku, as well as five of his ADF associates, previously were designated in December 2019 pursuant to Executive Order 13818 under the Global Magnitsky Human Rights sanctions program for their role leading an organization that has engaged in serious human rights abuses, and they joined a long list of individuals and organizations designated by President George W. Bush under Executive Order 13413 and President Barack Obama under Executive Order 13671 for engaging in armed conflict and widespread human rights abuses. As human rights remain a focus of the Biden Administration globally, additional designations under the Global Magnitsky sanctions program in areas of ongoing conflict in Africa—and wherever else ISIS expands its activities—are likely.

Asia

Myanmar (Burma)-Related Sanctions

President Biden established the first new sanctions program under his Administration on February 10, 2021, with Executive Order 14014, a blocking order targeting the defense sector of the Burmese economy, as well as Burmese military and security forces that were responsible for the February 1, 2021 coup and the brutal attacks against unarmed protesters that ensued.2 Six current and former military officials were designated for being directly involved in the coup.3 Four military officials and two other individuals appointed to the State Administration Council were also designated, together with three Burmese entities owned or controlled by the military or security forces .4 The most recent designations named the two adult children of the Commander-in-Chief of the Burmese military forces as SDNs, as well as six Burmese entities that they own or control.5

In addition to military and security leaders, the new sanctions also apply broadly to the Government of Burma, including the Central Bank of Myanmar, and the Government’s political subdivisions, agencies, instrumentalities, all persons “owned or controlled by, or acting on behalf of, the Government of Burma,” and other individuals who have undermined democratic processes or institutions or committed actions that threaten the peace, security or stability of Burma. 6  In the first 50 days of the Biden Administration, 23 individuals and entities have been designated under this program, and additional designations are likely if political prisoners are not released and the democratically elected government is not restored.7

In a related development, the Commerce Department’s Bureau of Industry and Security (“BIS”) removed Burma from Country Group B and placed it in Country Group D:1, resulting in a more restrictive review of license applications for exports and reexports, and also subjecting Burma to “military end use” and “military end user” restrictions under the Export Administration Regulations (“EAR”). 8  BIS also added four entities to the Entity List. As matters currently stand, transactions requiring a license for the export or re-export of items subject to the EAR when destined for Burma’s Ministry of Defense, Ministry of Home Affairs, armed forces, and security services will be reviewed by BIS under a presumption of denial. 9,10

Communist Chinese Military Companies Sanctions

Under the Administration of President Donald J. Trump, the United States imposed a new sanctions program designed to restrict the increasing militarization of the People’s Republic of China (“PRC”), which poses a threat to the national security of the United States. The Trump Administration initiated the sanctions program with Executive Order 13959 on November 12, 2020, by issuing sanctions designed to prevent U.S. persons from purchasing securities in—and thereby providing financing to—“Communist Chinese military companies”11  appearing on the Non-SDN Communist Chinese Military Companies List (NS-CCMC). Justifying the sanctions, President Trump stated,

“the People’s Republic of China (PRC) is increasingly exploiting United States capital to resource and to enable the development and modernization of its military, intelligence, and other security apparatuses, which continues to allow the PRC to directly threaten the United States homeland and United States forces overseas, including by developing and deploying weapons of mass destruction, advancing conventional weapons, and malicious cyber-enabled actions against the United States and its people.”12

The Biden Administration has not significantly altered the sanctions program, and has indicated a continued desire to “push back against the Chinese government’s economic abuses and coercion that undercut the foundation of the international economic system.” 13  However, the Administration reduced risks for market players by providing some additional certainty regarding which entities are subject to the sanctions. Specifically, the Biden Administration issued General License No. 1A clarifying, through May 27, 2021, which securities must be treated as issued by Communist Chinese military companies. General License No. 1A Authorizing Transactions Involving Securities of Certain Communist Chinese Military Companies covers transactions or activities that are derivative of, or are designed to provide investment exposure to the securities of entities whose names closely match—but do not exactly match—the name of a Communist Chinese military company, as defined by section 4(a) of Executive Order 13959.

PRC Military End-Users
The Biden Administration has not yet made significant changes to the new Military End-User (MEU) List — which contains many Chinese entities, as well as entities from Russia and Venezuela, that was issued in an amendment to the EAR by BIS in December 2020.14  As diplomatic engagement with the PRC takes the forefront of the foreign policy stage in the coming weeks, the direction of the PRC sanctions program, military end user restrictions, and military end use controls under the Biden Administration may come into sharper focus.

Europe

Ukraine-/Russia-Related Sanctions

The Biden Administration imposed a series of sanctions against individuals and entities involved in the poisoning and subsequent imprisonment of Aleksei A. Navalny, who has been the target of systematic harassment and repression by the Russian government due to his prominent role in the political opposition. Sanctions were issued simultaneously on March 2, 2021, by the Treasury Department, the State Department and the Commerce Department.

The OFAC designated seven Russian government officials on the SDN List.15  It also issued amended Cyber General License No. 1B Authorizing Certain Transactions with the Federal Security Service, and amended related FAQs: FAQ 501, FAQ 502 and FAQ 503.

The State Department imposed broad sanctions on Russia under the U.S. Chemical and Biological Weapons Control and Warfare Elimination Act of 1991. It also designated a series of entities and individuals under Executive Order 13382 and the Countering America’s Adversaries Through Sanctions Act for their association with Russia’s chemical weapons program, defense sector and intelligence sector.16  The State Department also amended Section 126.1 of the International Traffic in Arms Regulations (“ITAR”) to add Russia to the list of countries subject to enhanced export scrutiny and a policy of denial for exports of defense articles and defense services, with limited exceptions for certain exports in support of government space cooperation.

The Commerce Department also added 14 entities to the Entity List based on their activities supporting Russia’s weapons of mass destruction programs and chemical weapons activities.17 BIS added entities located in Germany, Russia and Switzerland to the list because they had undertaken proliferation activities in support of Russia. In taking these sweeping measures, the United States aligned its response to Russia’s use of a chemical weapon more closely with that of the European Union and other G7 partners.

The Biden Administration has taken no immediate steps with respect to the broad trade embargo against the Crimea region of Ukraine, which was first imposed by the Obama Administration following Russia’s invasion and annexation of the region in 2014. However, we expect no material deviation from the current programs based upon President Biden’s recent remarks and comments. At the virtual Munich Conference held in February, the President confirmed that “standing up for the sovereignty and territorial integrity of Ukraine remains a vital concern for Europe and the United States.”18  One week later, on the seventh anniversary of Russia’s invasion of Crimea, the President remarked: “The United States does not and will never recognize Russia’s purported annexation of the peninsula, and we will stand with Ukraine against Russia’s aggressive acts. We will continue to hold Russia accountable for its abuses and aggression in Ukraine.”19

Latin America

Cuba

Although President Biden has not yet taken any formal positions regarding Cuba policy, officials from his Administration have indicated that President Trump’s last-minute designation of Cuba as a state sponsor of terrorism and broader Cuba policy will be reviewed, with a focus on human rights and democracy.20  The state sponsor of terrorism designation brings with it restrictions on foreign assistance, a ban on defense exports and sales, and other export and financial controls.21 Aside from Cuba, such a severe designation currently only applies to Iran, North Korea and Syria.22 The Biden Administration also is expected to carefully examine the consequences of the Trump Administration’s decision in May 2019 to lift the suspension of Title III of the Helms-Burton Act, which opened the door for U.S. nationals to file suit in U.S. courts seeking compensation for property that had been seized by the regime of Fidel Castro. Although the Administration has said that Cuba policy is not its top priority, we expect to eventually see efforts to reassemble some of the pieces of the Obama Administration’s Cuba initiatives and policies, and we note that achieving closer cooperation may require shutting the door on Helms-Burton Act litigation.

Mexico-Related Sanctions under the Counter Narcotics Trafficking Sanctions Program

As human rights and immigration remain at the forefront of policy issues for the Biden Administration in Latin America, a new designation has been added in the Counter Narcotics Trafficking sanctions program. On March 3, 2021, the OFAC designated Mexican national Juan Manuel Abouzaid El Bayeh for his high-level role facilitating drug shipments and money laundering for the Cartel de Jalisco Nueva Generación (“CJNG”), a violent drug trafficking organization that traffics fentanyl and other illicit controlled substances into the United States. Abouzaid El Bayeh joins CJNG’s leader Ruben Oseguera Cervantes, his associates, and a series of Mexican businesses they own or control, including shopping centers, real estate companies, agricultural companies, a music promotion business, and a luxury boutique hotel in designations under the Foreign Narcotics Kingpin Designation Act, along with more than 2,200 other individuals and entities.23

Venezuela-Related Sanctions

The Biden Administration has indicated that it will not make significant changes to the Venezuela sanctions program for the time being, despite calls to reexamine the program due to the deteriorating economic and social conditions in the country and the inability of the sanctions program to bring about the desired regime change to date. The sanctions, first imposed by President Obama with Executive Order 13692 in 2015, are intended to put an end to “erosion of human rights guarantees, persecution of political opponents, curtailment of press freedoms, use of violence and human rights violations and abuses in response to antigovernment protests, and arbitrary arrest and detention of antigovernment protestors, as well as the exacerbating presence of significant public corruption” 24  perpetrated by the government of Venezuela under Maduro’s leadership. Through a series of seven executive orders, the program has imposed sweeping limitations on the government of Venezuela, as well as individuals and entities linked to the Maduro regime and its repressive acts.

On March 2, 2021, Secretary of State Antony Blinken spoke directly with Venezuelan Interim President Juan Guaidó to reaffirm U.S. support for a transition to the democratically elected government.25 The Biden Administration also issued an amended general license, adding to an already voluminous list of general licenses and FAQs to facilitate humanitarian and public health operations in Venezuela. The OFAC issued amended General License No. 30A, “Authorizing Certain Transactions Necessary to Port and Airport Operations,” adding interactions with the Instituto Nacional de los Espacios Acuáticos (the National Institute for Aquatic Spaces) to the license for transactions and activities that are incident and necessary to operations or the use of ports and airports in Venezuela. Previously, General License No. 30 applied only to port and airport operations with the Government of Venezuela.

Middle East

Iran Sanctions Program

There have been no new developments in the various sanctions programs involving Iran, although President Biden has made it clear that the United States would be “prepared to reengage in negotiations with the P5+1 on Iran’s nuclear program”26 to achieve a new deal on a “compliance for compliance basis.”27 Meanwhile, certain “mixed messages” sent by Ayatollah Ali Khamenei in recent weeks regarding Iran’s intentions with respect to its nuclear program28 have clouded the picture, as have pressures from Iranian hard-liners that further diplomatic engagement with the United States will not put an end to crippling sanctions that have devastated the Iranian economy.29

On February 2, 2021, the Biden Justice Department commenced a civil action in the U.S. District Court for the District of Columbia seeking the seizure and forfeiture of certain petroleum cargoes as assets of the Islamic Revolutionary Guard (“IRGC”) and the IRGC Quds Force (“IRGC-QF”).30 The complaint alleges that the petroleum product is aboard the motor tanker ACHILLEAS following a series of AIS spoofing incidents and clandestine ship-to-ship transfers designed to disguise the product’s origin and affiliations. The lawsuit suggests the continuation of an aggressive litigation policy started under the Trump Administration designed to intercept and disrupt the ocean transportation of petroleum product with alleged ties to the IRGC and the IRGC-QF.31

Saudi Arabia-Related Sanctions under the Global Magnitsky Sanctions Program

On the same day the declassified intelligence report was released regarding the murder of Washington Post columnist Jamal Khashoggi in 2018, OFAC announced sanctions against an additional individual and entity directly involved in the killing. OFAC designated the Saudi Rapid Intervention Force and Ahmad Hassan Mohammed al Asiri, the former Deputy Head of Saudi Arabia’s General Intelligence Presidency, under the Global Magnitsky Human Rights sanctions program pursuant to Executive Order 13818. Attempting to strike a delicate balance regarding a key ally in the region, the Administration stopped short of sanctioning Crown Prince Mohammed bin Salman, despite findings in the report that he was ultimately responsible for the murder. Asiri and RIF join 17 individuals who were designated on November 15, 2018, for having led or participated in the operations team allegedly responsible for Mr. Khashoggi’s murder.

Yemen-Related Sanctions

The Biden Administration has expressed a deep and urgent commitment to ending the ongoing conflict in Yemen to alleviate humanitarian suffering there. Responding to calls by humanitarian agencies that the sanctions designations were inhibiting their ability to operate in the region, the Biden Administration revamped the Yemen sanctions program by revoking the designation of Ansarallah, also known as the Houthi movement, as a foreign terrorist organization, which was issued on the last days of former President Trump’s presidency. Officials have clarified that the un-designation did not demonstrate support for the Houthis, a group the United States continues to condemn. Rather, the designation was revoked because it had the unintended consequence of impeding the delivery of humanitarian aid to the people of Yemen, and international aid groups resoundingly called for the United States to rescind the designation to avoid dramatic consequences to humanitarian efforts in the region.32 In place of the Ansarallah designations, OFAC designated key military leaders of the Ansarallah militia, Houthi Naval Forces Chief of Staff Mansur Al-Sa’adi and commander of Yemen’s Houthi-aligned Yemeni Air Force and Air Defense Forces Ahmad Al-Hamzi. Previous Ansarallah designations made in 2014 and 2015 under U.N. sanctions and U.S. Executive Order 13611 against Abdul Malik al-Houthi, al-Khaliq Badr al-Din al-Houthi, and Abdullah Yahya al Hakim remain in effect.

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1See U.S. Dep’t of State, Media Note, “State Department Terrorist Designations of ISIS Affiliates and Leaders in the Democratic Republic of the Congo and Mozambique” (Mar. 10, 2021) (https://www.state.gov/state-department-terrorist-designations-of-isis-affiliates-and-leaders-in-the-democratic-republic-of-the-congo-and-mozambique/).
2See Exec. Order No. 14014, “Blocking Property with Respect to the Situation in Burma,” Fed. Reg., Vol. 86, No. 28 (Feb. 12, 2021).
3The designated individuals are: Commander-in-Chief of the Burmese military forces Min Aung Hlaing; Deputy Commander-in-Chief of the Burmese military forces Soe Win; First Vice President and retired Lieutenant General Myint Swe; Lieutenant General Sein Win; Lieutenant General Soe Htut; and Lieutenant General Ye Aung.
4The designated individuals and entities are: General Mya Tun Oo; Admiral Tin Aung San; Lieutenant General Ye Win Oo; ans Lieutenant General Aung Lin Dwe. Lieutenant General Moe Myint Tun, General Maung Maung Kyaw, Cancri Gems & Jewellery Co., LTD. Myanmar Imperial Jade Co., LTD., and Myanmar Ruby Enterprise. See U.S. Treasury Dep’t, Press Release, “United States Targets Leaders of Burma’s Military Coup Under New Executive Order” (Feb. 11, 2021) (https://home.treasury.gov/news/press-releases/jy0024); U.S. Treasury Dep’t, Press Release, “United States Targets Members of Burma’s State Administrative Council following Violence against Protestors” (https://home.treasury.gov/news/press-releases/jy0031).
5The designated individuals and entities are: Aung Pyae Sone; Khin Thiri Thet Mon; A & M Mahar Co. Ltd.; Everfit Co. Ltd; Seventh Sense Co. Ltd; Sky One Construction Co. Ltd; the Yangon Gallery; and the Yangon Restaurant.
6See Exec. Order No. 14014, “Blocking Property with Respect to the Situation in Burma,” Fed. Reg., Vol. 86, No. 28 (Feb. 12, 2021).
7The extension of martial law across more districts in Burma and the increased violence against protestors, resulting in the reported death of 50 protestors on March 14, 2021, is complicating an already deteriorating situation. See BBC News, “Myanmar military extends martial law after bloodiest day since coup” (Mar. 15, 2021)( https://www.bbc.com/news/world-asia-5639800)
8See U.S. Dep’t of Commerce, Bureau of Industry and Security, “Burma: Implementation of Sanctions,” Docket No. 210302-0033, Final Rule, 86 Fed. Reg. 13173-13178 (Mar. 8, 2021). By removing Burma from Country Group B and moving it to Country Group D:1, BIS has effectively narrowed the AVS license exception for the export and re-export of equipment and spare parts for aircraft and vessels registered in Burma, or owned or controlled by or under charter or lease to a Burmese national.
9See U.S. Dep’t of Commerce, Bureau of Industry and Security, “Burma: Implementation of Sanctions,” Docket No. 2102-0010, 86 Fed. Reg. 10011 (Feb. 18, 2021).
10The designated entities are: the Burmese Ministry of Defence; the Burmese Ministry of Home Affairs; the Myanmar Economic Corporation; and the Myanmar Economic Holding Limited. See U.S. Dep’t of Commerce, Bureau of Industry and Security, Press Release, “Commerce Implements New Export Controls on Burma and Makes Entity List Additions in Response to the Military Coup and Escalating Violence against Peaceful Protesters” (Mar. 4, 2021).
11See Exec. Order No. 13959, “Addressing the Threat from Securities Investments That Finance Communist Chinese Military Companies,” 85 Fed. Reg. 73185-73189 (Nov. 17, 2020). This Executive Order was subsequently amended by Executive Order No. 13974, “Amending Executive Order 13959 – Addressing the Threat from Securities Investments That Finance Communist Chinese Military Companies,” 86 Fed. Reg. 4875 (Jan. 13, 2021).
12See 85 Fed. Reg. at 73185.
13The White House, “Remarks by President Biden at the 2021 Virtual Munich Security Conference” (Feb. 19, 2021) (https://www.whitehouse.gov/briefing-room/speeches-remarks/2021/02/19/remarks-by-president-biden-at-the-2021-virtual-munich-security-conference/).
14See 15 C.F.R. 744, Supp. No. 7.
15The designated individuals are: Aleksandr Bortinkov, director of FSB; Alexander Kalashnikov, director of the Russian Penitentiary Service, or FSIN; Sergey Kiriyenko, deputy chief of staff to Russian President Vladimir Putin; Igor Krasnov, Russia’s prosecutor-general; Col. Gen. Aleksey Krivoruchko and Gen. of the Army Pavel Popov, deputy defense ministers; and Andrei Yarin, director of Russia’s Presidential Domestic Policy Directorate.
16The designated individuals and entities are: 27th Scientific Center; 48 Central Scientific Research Institute Sergiev Posad; 48 Central Scientific Research Institute Kirov; 48 Central Scientific Research Institute Yekaterinburg; State Scientific Research Institute of Organic Chemistry and Technology; 33rd Scientific Research and Testing Institute; the Federal Security Service (“FSB”); the Main Directorate of the General Staff of the Armed Forces of the Russian Federation (“GRU”); and GRU officers Alexander Yevgeniyevich Mishkin and Anatoliy Vladimirovich Chepiga.
17See U.S. Dep’t of Commerce, Bureau of Industry and Security, Addition of Entities to Entity List, Docket No. 201216-0348, Final Rule, 86 Fed. Reg. 12529–12534 (Mar. 4, 2021).
18The White House, “Remarks by President Biden at the 2021 Virtual Munich Security Conference” (Feb. 19, 2021) (https://www.whitehouse.gov/briefing-room/speeches-remarks/2021/02/19/remarks-by-president-biden-at-the-2021-virtual-munich-security-conference/).
19The White House, “Statement by President Biden on the Anniversary of Russia’s Illegal Invasion of Ukraine” (Feb. 26, 2021) (https://www.whitehouse.gov/briefing-room/statements-releases/2021/02/26/statement-by-president-biden-on-the-anniversary-of-russias-illegal-invasion-of-ukraine/).
20The White House, “Press Briefing by Press Secretary Jen Psaki and Deputy Director of the National Economic Council Bharat Ramamurti” (Mar. 9, 2021).
21See U.S. Dep’t of State, Bureau of Counterterrorism, “State Sponsors of Terrorism” (https://www.state.gov/state-sponsors-of-terrorism/).
22See U.S. Dep’t of State, Bureau of Counterterrorism, “State Sponsors of Terrorism” (https://www.state.gov/state-sponsors-of-terrorism/).
23See U.S. Treasury Dep’t, Office of Foreign Assets Control, Press Release, “Treasury Sanctions Fugitive Associate of CJNG” (Mar. 3, 2021).
24See Exec. Order No. 13692, “Blocking Property and Suspending Entry of Certain Persons Contributing to the Situation in Venezuela,” Fed. Reg. 12747-12751 (Mar. 8, 2015).
25See U.S. Dep’t of State, Office of the Spokesperson, Readout, “Secretary Blinken’s Call with Venezuelan Interim President Guaidó” (Mar. 2, 2021).
26The White House, “Remarks by President Biden at the 2021 Virtual Munich Security Conference” (Feb. 19, 2021) (https://www.whitehouse.gov/briefing-room/speeches-remarks/2021/02/19/remarks-by-president-biden-at-the-2021-virtual-munich-security-conference/).
27See Ned Price, U.S. Dep’t of State, Office of the Spokesperson, “Department Press Briefing – February 22, 2021,” (Feb. 11, 2021) (https://www.state.gov/briefings/department-press-briefing-february-22-2021/).
28Hadi Kahalzadeh, “’Maximum Pressure’ Hardened Iran Against Compromise,” Foreign Affairs (Mar. 11, 2021) (https://www.foreignaffairs.com/articles/iran/2021-03-11/maximum-pressure-hardened-iran-against-compromise).
29Id.
30United States of Am. v. All Petroleum Prod. Cargo Aboard the Achilleas, Civil A. No. 21-cv-305 (D.D.C. Feb. 2, 2021).
31See United States of Am. v. All Petroleum Prod. Aboard the Bella, Civil A. No. 20-cv-1791 (D.D.C. _____); United States of America v. Oil Tanker – “Grace 1” and All Petroleum Aboard Oil Tanker – “Grace 1,” Civil A. No. 19-cv-1989 (D.D.C. July 3, 2019).
32See Ned Price, U.S. Dep’t of State, Office of the Spokesperson, “Department Press Briefing – February 11, 2021” (Feb. 11, 2021)

© 2020 Vedder Price

ARTICLE BY John E. Bradley,  and Aleksandra Rybicki of Vedder Price
For more articles on trade, visit the NLR Antitrust & Trade Regulation section.

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