Why Your Bio Picture Matters

I have been providing marketing advice to professionals for over 25 years (time flies when you are having fun!). I started my career on Wall Street, advising stockbrokers on promoting financial product to clients, then moved to the accounting world, working with CPAs on marketing their services and now I work with lawyers. Besides general marketing on behalf of the firm, I also work directly with the attorneys on their business development efforts and promotion

The first tool for promoting a professional services provider is their online bio. I started marketing professional services when websites were still the new thing. One of the first websites I designed included an audio component to the CPAs bios; the website later won an award for that unique feature. I wanted to have something “cool” and that made the accountants stand out more and overcome the stereotype that accountants were “kinda boring.” I remember the clients’ feedback that they liked to hear their advisor’s voice and not just see their picture in their bio, that it helped hearing what they had to say and connecting in a different way. It helped prospective clients make the decision to want to work with a particular accountant.

My advice to the professionals I worked with has always been to stand out, to have a unique feature that would make a professional be different than his or her competition. Not to look or sound like everyone else because it was the industry norm or what everyone else was doing. But to try to find something that will help connect to the audience, to the people that were eventually buying their services and to understand what they were looking for and what determined their ultimate decision.

Recently, I had to make the decision to choose a doctor for a delicate medical procedure. I had to move fast so I started doing research on the doctor that was recommended to me and that would soon have my life in his hands. Of course, the first place I landed was the hospital’s website. I liked his credentials, his training and experience but his picture was outdated and didn’t match his personality nor his credentials. Something about it put me off, although he was smiling in the picture and looked handsome. When I choose doctors, it is very important for me to have a connection with the person behind the credentials, to feel comfortable and safe. Probably, similar to how people usually choose other advisors as well but even more important.

My first appointment with him was through a telemedicine/video call to discuss my diagnosis and the procedure he would perform and to schedule it. At first the video feature didn’t work and I thought it was his choice; which I found odd and fed into my initial discomfort when seeing his picture. Luckily, we both realized that it was actually a glitch and he offered to call me on Facetime – a nice touch on his part (as usually doctors keep their personal numbers private). I almost didn’t recognize the person from the picture on the hospital’s website! He looked so different and his personality was totally opposite from the reaction I had to the “professional” picture! He was warm, friendly, passionate about his skill, patient to answer questions and also had a very down to earth air and not the unapproachable demeanor some doctors portray. He was someone I would pick as a friend but also, someone I could trust that indeed he was a good doctor.

I also started digging deeper to learn more about him. I was hoping I could find pictures from his personal life or in other professional instances. And I did! Those pictures, similar to the video call, uncovered a different person than what his “professional” picture on the hospital’s website showed. Somebody I was so comfortable with putting my life in his hands that I didn’t need to go for a second opinion.

This doctor performed the procedure and all is well. Before being discharged from the hospital, I gave him my professional advice: to have his picture on the website replaced with a new one, to reflect his personality and what his patients need to see in him. I told him my feedback, which he was surprised to hear but seemed to really appreciate it. I couldn’t help the marketing professional in me.

I believe the same applies to any professional that relies on a bio with a picture to make a first impression on their audience. It is important to recognize what would connect them to their clients and potential clients.

Your bio picture does matter! It is a small tool in the marketing toolbox but it has a huge impact. After all, a picture is worth a thousand words!

© The National Law Forum. LLC
For more articles on legal marketing, visit the National Law Review law office management section. 

No Tricks, Just Treats When Working with Legal Media

Engaging with the media might seem more frightening than a haunted house, but working with journalists doesn’t have to be scary. As long as you’re adequately prepared, engaging with reporters can be an enjoyable experience that significantly bolsters your firm’s brand.

The key is to understand what journalists need and want for their legal news coverage, particularly as the state of the world and media industry continue to rapidly evolve. Notably, in the last seven months, the news has been changing so fast that what was important a few weeks ago — or even a few days ago — may no longer be significant to reporters and editors planning their future coverage.

Developing a Pitch 

When pitching an idea to the media, think about what does or does not make a good news story. Reporters receive hundreds of story ideas every day, and sometimes news that you find noteworthy unfortunately isn’t going to appeal to a bigger audience (e.g., too routine, too narrow in scope or lack of timeliness). Journalists look for pitches with issues their readers will care about and sources who can provide unique insights and angles into complicated issues. When reaching out to media personnel, think about how your matter, event, lateral hire or firm initiative fits into a larger trend or development, and provide this angle to reporters. Let them know of any distinctive elements or especially complex issues, and then sell them on why the item is relevant to their readers.

Rules of the Interview Process

Once you have secured an interview, set ground rules prior to the meeting or call about whether the conversation will be “on the record,” “on background” or “off the record” — and know the difference.

  • “On the record” means that the reporter may quote you and include your name and title.
  • “On background” means the reporter may use direct quotations but will attribute them to “a source familiar with the matter” or another agreed-upon designation that is clear enough to establish credibility but vague enough that it doesn’t reveal your identity.
  • “Off the record” means the reporter cannot quote you or use any of the information you provide without verifying it independently. These types of interviews grant sources anonymity and are typically used in connection with particularly sensitive stories. Be very careful, however, in these situations. Despite having your identity protected, the conversation isn’t really confidential. The best rule of thumb is to never tell a reporter anything that you are not willing to see in print – no matter what.

Generally, anytime you speak with a reporter, you are speaking on the record unless the reporter has agreed to a different arrangement.

After the ground rules are set, it’s not a good idea to try to switch them during the interview. That could become too confusing for both you and the reporter in terms of what is public information and what is confidential, which could lead to something being published that you didn’t want out in the open. Also, once something is said, it cannot be taken back, and it is fair game to be published. If you absolutely have to say something that should be kept private during an interview, confirm with the reporter before speaking that the upcoming statement is off the record.

Reporters are very unlikely to let you see a story before it publishes, but sometimes they will grant an interviewee quote review privileges if requested before the interview and if the publication schedule permits. But fast, tight deadlines are more of the norm these days, given the high volume of content being pushed out by publications, so not all outlets will be able to grant this request.

Keep in mind, though, that quote review is only used to confirm the accuracy of the quotations that will be attributed to you. It is not meant for re-writing for stylistic purposes and should not be misused as a fail-safe to fix imperfect statements.

Also before an interview, ask the reporter for the overall context of the piece and for specific questions that he or she wants to discuss so you can develop key messages to convey that are on brand with your firm. Repeat, reiterate and restate these talking points throughout the interview to increase the likelihood that your messaging is understood and incorporated into the article.

Conducting the Interview

During an interview, even if you are nervous, make a conscious effort to speak slowly and concisely, and focus on answering just the particular question at hand. Key messages can get lost in too much detail and technical information. It’s not the reporter’s job to make you look good, but you can make yourself look good by providing clear and thoughtful information.

It’s also a good idea to pause briefly to gather your thoughts before answering a question. If you don’t know the answer or don’t want to or can’t respond, be honest. It is okay not to answer every single question and legal reporters understand client confidentiality and permission issues. You can also try to point them to a colleague who is better suited to speak to a particular topic.

On the other hand, journalists look to lawyers for certain knowledge and experience. Reporters need to understand the full picture to write their best coverage, so don’t be afraid to educate or set the record straight on particularly complex matters or issues. But also know when to stop, and don’t keep talking just to fill silence.

Also, keep in mind that the world is increasingly becoming more digital — especially since most of us are now working from home — and short-form content continues to grow in popularity. Readers are accustomed to scanning feeds and digests for news that is delivered at a glance. When acting as a source for the media, it is valuable to be able to deliver succinct and pertinent comments for those journalists who do not have the word space for long articles.

Post-Publication 

After a story is published, be sure to let the reporter know if you are pleased with the piece and keep in contact to build the relationship. If an article contains factual mistakes or erroneous information, let the reporter know to fix it or print a correction. But recognize that, if there is any debate as to the accuracy of the material, the power over revisions ultimately remains with the journalist and his or her editor or publisher.

The fundamentals of working with the media are the same as they have always been, even with the changes in the world of journalism from the Internet and social media. Understanding these basics will go a long way to securing more media placements, strengthening your public relations initiatives and generating greater success for you and your firm.


© Copyright 2008-2020, Jaffe Associates
ARTICLE BY Rachel Sisserson of Jaffe
For more articles on the legal industry, visit the National Law Review Law Office Management section.

Vehicle Inventory Historically Low

There can be many impediments to buying a new vehicle. COVID has certainly created a wide variety of barriers to the manufacturing and sale of a new vehicle.  Supply chain disruptions and distressed suppliesemergency orders inhibiting the ability to meet in person, not to mention the general recession across the United States and the world.  Add a new one for the industry to deal with: low inventory.

Yes, vehicle inventory has dropped to historic lows. Inventory of new cars dropped as low as a 62 day supply this summer.  This is well below the mark of 79 days from July 2019. Some large OEMs had inventory supply of below 40 daysWhen COVID hit in March, dealers had 3.4 million vehicles in inventory.  Now, that number is down to 2.2 million. This is kept sales rolling and led to some profitable months for dealers and the industry.

Not surprisingly, truck inventory pulled those averages down. Also not surprisingly, as inventory dropped, prices rose (recall your supply/demand economics classes). Low inventory does not just mean less vehicles to sell, but less variation of those vehicles is available. Most people can think of their top five items that they want in a new car, but those top five items are not always the same. This means that even if  a consumer wants to buy a vehicle, they may not be able to buy what they want. “It’s not only an issue of do we have enough overall inventory, but do we have the right inventory,” Charlie Chesbrough, senior economist for Cox, said on a call discussing Cox’s auto sales forecast.

And, it is October. Dealers should be striking deals to get 2020 models off the lot and makes space for 2021 models.  2021 models may not actually show up until 2021.  That is unheard of. With the 2021 model year part of an ongoing transition in the industry – multiple transitions – it might be the shortest, least interesting model year in decades. There are transitions to power trains (electric), transitions to autonomous levels, and transitions in the entire sales structure of the industry (online).  As of now, only 3% of inventory is new model years, compared to what should be 25% at the same stage.

As it is, sales in 2020 are expected to end a lengthy string of exceeding 17 million vehicles passing through North America’s showrooms. All things considered, sales approaching 14 million vehicles is actually quite impressive. But the lack of inventory now, and in the pipeline, combined with the ongoing challenges in production and employment due to COVID do not bode well for 2021 seeing any kind of quick turnaround for the industry.

And, there is an election. The regulatory and business environment could be almost anything 60 days from now, or 90 days, or 180 days. Predictability for the automotive industry has been hard to come by recently, and this election season has not helped.  At the end of the day, the automotive industry is no more immune from the craziness of 2020 (and maybe 2021) as most other industries.


© 2020 Foley & Lardner LLP
For more articles on cars, visit the National Law Review Utilities & Transport section.

Legal Industry News: Law Firm Hires, Recognition & Attorneys Getting Out the Vote

The National Law Review curates noteworthy legal industry moves, law firm innovation, and attorney recognitions and awards.  Read on to learn more about innovative developments in the legal area.

Law Firm Strategic Additions

Former congressman Mike McIntyre joined Ward and Smith as the firm’s Senior Advisor for Government Relations and Economic Development.

McIntyre was elected to North Carolina’s 7th Congressional District in the U.S. House of Representatives in 1996 and served for nine consecutive terms working on issues such as economic and business development in rural and coastal communities. He also served as the No. 2 ranking member of the House Agriculture Committee and was the No. 3 ranking member of the Armed Services Committee.

“I’ve known Mike for decades. His dedication, commitment, and extensive knowledge of local, state, and federal issues are unparalleled,” said Jamie Norment, the firm’s Government Relations Practice Group leader. “The caliber of our Government Relations team was extensive before. With Mike joining the team, our capacity to represent clients in and out of North Carolina is bar none.”

McIntyre’s legal practice includes sports and entertainment, business, agribusiness, energy, environmental and real estate. He will be based out of the firm’s Raleigh office and will include work on behalf of clients in Washington, D.C.

Gabriel Edelson joined Varnum’s Business and Corporate Services practice team, and will be based in the firm’s Birmingham Michigan office.

Edelson’s practice focuses on mergers and acquisitions, divestitures, corporate governance and general corporate matters, representing private equity firms and portfolio companies. He also serves as a board member of the Founders Junior Council at the Detroit Institute of Art.

“We’re very pleased to welcome Gabe to Varnum and the Birmingham office,” said Seth Ashby, who leads the firm’s Business and Corporate Services group. “In addition to being an excellent lawyer, Gabe brings a variety of experience and interests to the team and we look forward to working with him.”

Andrew P. Young joined Barnes & Thornburg as a partner in the firm’s San Diego office, where he will be a member of the firm’s Litigation Department. Young has over a decade of government prosecution experience, having previously served as Assistant U.S. Attorney in the Major Frauds and Public Corruption Unit for the Southern District of California and as a Criminal Trial Attorney in the Department of Justice’s Tax Division.

“Fraud and corruption skyrocket in moments of crisis, and we’re already starting to see charges brought involving PPP loans and a number of other COVID-19 related issues,” said Randy Brown, chair of the firm’s Litigation Department. “Given his storied government experience, Andrew can offer clients valuable knowledge in these and other areas.”

Young focuses his practice on white-collar criminal defense, compliance, internal investigations and complex business litigation. As a federal prosecutor, he secured more than 100 convictions and seized more than $35 million in illicit gains.

“We’ve grown an impressive bench of litigators in Southern California, and Andrew is the third prosecutor to join us from the U.S. Attorney’s office since 2019,” said Troy Zander, San Diego partner-in-charge. “Andrew is uniquely positioned to advise our clients and bolster our litigation practice in San Diego and beyond and I’m thrilled to welcome him.”

Eric Winwood joined Sidley Austin as a partner in the firm’s Dallas office, and will be a member of Sidley’s Employee Benefits and Executive Compensation practice and the leader of the firm’s Dallas Tax, Employee Benefits and Executive Compensation group. Before joining Sidley, Winwood was an employee benefits and executive compensation partner with Baker Botts LLP and a member of its Oil and Gas M&A team.

Winwood’s experience includes advising clients on compensation and benefits matters, including those associated with domestic and international M&A and private equity transactions, spinoffs, and joint ventures and has significant experience in the energy sector.

“Eric’s experience advising clients on the executive compensation aspects of transformative M&A and private equity transactions will be a great value to clients across our many practices,” said Laura Barzilai, global leader of Sidley’s Tax, Employee Benefits and Executive Compensation practice. “Additionally, Eric’s knowledge of a wide array of compensation and benefits matters further strengthens our existing team that regularly advises clients on highly sensitive matters, including executive onboarding and exits.”

Carolina Guibert Chase joined Allen Matkins as a partner, specializing in land use law, including California Environmental Quality Act compliance. Her background includes extensive experience in urban planning and land use law.

“San Francisco’s always-shifting legislation and complex planning code make it one of the most challenging jurisdictions for real estate developers in California, if not the country. Caroline’s keen understanding of, and experience working within, this complicated environment gives her the upper hand when assisting clients to move projects forward,” says Emily L. Murray, co-chair of Allen Matkins’ Land Use, Environmental, and Natural Resources practice group. “Caroline deepens the bench of the firm’s already dynamic Land Use Practice Group and we look forward to having her on our team.”

In her legal career, Chase has represented an array of educational institutions including the University of San Francisco, and affordable housing developers, including some of the Bay Area’s top mixed-use, office, and residential developers.

Chase serves on the San Francisco Housing Action Coalition Board (SFHAC) and is Chair of the SFHAC Legislative Committee. She is also a member of the San Francisco Planning and Urban Research Association Housing Policy Committee and the Urban Land Institute.

Law Firm Recognitions and Attorney Awards

Sterne, Kessler, Goldstein & Fox was named as the Inter-Partes Review Firm of the Year and earned the Hatch-Waxman Impact Case of the Year award at the 2020 LMG Life Sciences Americas Awards. Sterne Kessler was also recently recognized by Managing Intellectual Property as the 2020 PTAB Firm of the Year.

The Hatch-Waxman Impact Case of the Year award recognizes Sterne Kessler’s ’s work before the Patent Trial and Appeal Board in Amneal Pharmaceuticals LLC et al. v. Almirall LLC, which resulted in a final written decision in favor of the firm’s ’s client Amneal Pharmaceuticals. Sterne Kessler has been previously recognized by LMG LIfe Sciencesfor the award.

“There aren’t many firms that have won an award category three times from LMG Life Sciences, but Sterne Kessler is an appropriate fit for the record due its substantial PTAB group, and one we are happy to name as Inter-Partes Review Firm of the Year,” said LMG Life Sciences editor Chris Adams. “The firm is one of the most active, has the clients, and takes part in novel post-grant matters showcased through its work in the recent Amneal case.”

Sterne Kessler was also shortlisted by LMG Life Sciences in the Hatch-Waxman Litigation – Generic, Patent Strategy Firm of the Year, Intellectual Property and Intellectual Property Boutique categories. Sterne Kessler directors were also finalists in certain categories, including   Eldora L. Ellison, Ph.D. and Deborah Sterling, Ph.D. for Post-Grant Proceedings Attorney of the year, JC Rozendaal for Hatch-Waxman Litigator of the Year – Generic and Gaby L. Longsworth, Ph.D. for Patent Strategy Attorney of the Year – District of Columbia.

Euromoney Legal Media Group (LMG) selected Knobbe Martens Partner Susan Natland as the recipient of its “Best in Trademark” award at the 2020 Americas Women in Business Law Awards ceremony held virtually September 17th.

Natland previously received the “Best in Trademark” honor in 2015, and has been named to LMG’s Americas Women in Business Law expert guide four times. She co-chairs Knobbe Martens’ Trademark and Brand Protection Group, and specializes in international and domestic trademark selection and clearance, enforcement and brand protection. Natland has argued multiple cases before the Trademark Trial and Appeal Board. She advises officials at the U.S. Patent and Trademark Office and is a member of the Trademark Public Advisory Committee. She is a former member and chair of the firm’s diversity committee.

Five Perkins Coie Trademark Partners were named as 2020 WTR Global Leaders by World Trademark Review.

Patchen HaggertyLynne Graybeal, and Grace Han Stanton received recognition in Washington state; Scott Palmer in China; and Fab Vayra in the District of Columbia were recognized by World Trademark Review for their expertise and experience in relation to managing, protecting, creating and enforcing essential brand rights.

Perkins Coie’s IP practice includes over 250 attorneys and agents, with extensive experience in all areas of U.S. and international trademark prosecution.

Los Angeles and San Francisco Daily Journals’ named Jennifer Keller of Keller/Anderle LLP on its list of The Top 100 Lawyers in California. This marks her thirteenth appearance on the list.

Keller was also ranked as the No. 1 attorney in Southern California by Southern California Super Lawyers for 2020, and was recognized on the list of the 2020 Benchmark Litigation Top 100 Trial Lawyers in America. Keller is also a 2018 inductee to the California Lawyers Association Trial Lawyers Hall of Fame.

Keller represents plaintiffs and defendants in commercial litigation and white collar cases. Keller recently won a temporary restraining order in federal court after plans were announced to turn a Costa Mesa facility previously condemned as unfit for human habitation into an 80 patient coronavirus treatment center. The plans were abandoned.

Law Firm Innovation and Initiatives

Blank Rome launched its Biometric Privacy Team, composed of multidisciplinary attorneys from its Cybersecurity & Data Privacy, Privacy Class Action Defense, Artificial Intelligence Technology, and Labor & Employment groups. The group was created to help clients address and minimize risks associated with biometric privacy regulatory compliance, enforcement, and litigation.

“We are thrilled to launch this important and timely initiative,” said Jeffrey N. Rosenthal, who leads the Firm’s Biometric Privacy Team. “Our team includes both highly experienced compliance counsel and seasoned privacy class action defense litigators. Collectively, we are well positioned to help clients navigate today’s myriad biometric privacy laws. Whether proactively developing comprehensive compliance/risk management programs or aggressively defending clients in state and federal courts across the country, our Biometric Privacy Team possesses the technological savvy, industry knowledge, and battle-forged litigation skills needed to counsel and defend our clients as consumer privacy laws continue to expand and evolve.”

A team of attorneys from Bryan Cave Leighton Paisner (BCLP) worked with the Lawyers’ Committee for Civil Rights Under Law intervened on behalf of the Georgia NAACP and the Georgia Coalition for the People’s Agenda to stop over 14,000 voters in  Fulton County being purged from the county’s list of registered voters.   The group of BCLP attorneys filed an emergency motion, stopping a lawsuit demanding challenge hearings and the purging of impacted voters.  Along with the emergency motion, the team argued the lawsuit should be dismissed, saying the lawsuit was an illegal attempt to avoid the requirements of the National Voter Registration Act of 1993 (NVRA).  After a hearing, the court denied the petition to purge the voters, pointing out the NVRA precludes voter removal within 90 days of a federal election.

Both the Georgia NAACP and the Georgia Coalition for the People’s Agenda have been working to get out the vote in Georgia ahead of the 2020 election, and the suit’s dismissal is helpful to that cause. Jennifer Dempsey, a partner at Bryan Cave Leighton Paisner LLP, said of the victory:

Now more than ever we need to protect the right to vote. Hopefully, our work here with the Lawyers Committee will help to dissuade similar attacks on the right to vote in Georgia and in the rest of the country.

The BLCP team included Atlanta Partners Bill Custer and Jen Dempsey. Custer is currently serving on the board of directors of the Lawyers’ Committee. Atlanta/Los Angeles Associate Christian Bromley, Atlanta Associate Leah Schultz and Atlanta Paralegal Stephanie Roberts, and Leanne Middleton also worked on the project.

Read Ahead, a nonprofit that partners volunteer mentors with elementary school students in New York City, recognized DLA Piper as the organization’s virtual gala, Books and Beyond.

More than 80 of DLA Piper’s lawyers and staff volunteered to serve as mentors to students in the program. DLA Piper Partner Christopher Paci, serves on Read Ahead’s board of directors.

“Our commitment to creating a culture that is inclusive of all people, and where everyone has an opportunity to succeed, is fundamental to who we are,” said Fenimore Fisher, DLA Piper’s chief diversity and inclusion officer, while accepting the recognition on September 16, 2020. “We support Read Ahead’s mission that every child deserves the opportunity to be successful in school and in life.”

The Antitrust Group at Proskauer Rose announced an interactive price gouging map, providing at-a-glance information on state regulations on price gouging restrictions.  This information is especially needed due to unscrupulous business practices gong on duirng the COVID-19 pandemic.  The map helps users stay aware of local, state and federal rules, as well as executive orders, put in place since the onslaught ofthe Coronavirus pandemic.  Christopher Ondeck, co-chair of Proskauer Rose’s Antitrust group, states the map highlights the challenge of complying with a web of price-gouging laws that apply in different jurisdictions, and a major problem for businesses is gauging which laws are applicable on what products and services.  He says,  “A price change that is safe in some states could be illegal in many others. Different products and services are covered by different states. . .  Our map provides businesses with a tool to help with this challenge in an interactive and user-friendly format.”

That’s the news for now.  We’ll be back in two weeks with more information.


Copyright ©2020 National Law Forum, LLC
For more articles on the legal, industry, visit the National Law Review Law Office Management section.

Commerce, Culture, and Compliance

Banking, at least since the passage of the Federal Reserve Act in 1913 and the creation of Federal Deposit Insurance under the Glass-Steagall Act of 1933 (FDIC insurance actually became effective January 1, 1934), has been seen (at least in popular portrayals in books and movies) as a rather staid business conducted in marble edifices by men (although that is changing) who were reserved and rather aloof. All that changed in 1973 in the South Jersey town of Cherry Hill, less than 10 miles from Center City, Philadelphia. Vernon Hill, a Wharton School graduate and fast-food restaurant franchise owner (McDonald’s), decided to turn banking “on its ear,” by bringing fast-food convenience to banking.

Commerce Bank

Over the ensuing 33 years, he expanded Commerce Bank from one to over 435 locations, with each branch (internally called a “store”) having a standard and almost identical design. Commerce called itself, with good reason, the most convenient bank in America. Commerce was open 7 days a week (except in Bergen County, New Jersey). Commerce was known for its ”penny arcade” coin counting machines for customers and non-customers alike. It offered no-fee Visa gift cards, reimbursement of foreign ATM fees, and lollipops and dog biscuits in lobbies and drive-throughs. Commerce’s slogan was “No Stupid Fees, No Stupid Hours,” and it became known as “Mc-Bank.” Commerce Bank had “stores” from Florida to New York. The rapid growth and successes of Commerce Bank even led to a Harvard Business Review article in 2002, Frei, Francis X., Hajim, Corey, “Case Study: Commerce Bank” (2002-12-02).

Commerce Bank was a financial institution that placed a premium on market-driven entrepreneurship and innovation. But sometimes it moved too far, too fast for regulators. That culminated in a settlement by Commerce with both the Office of the Controller of the Currency (“OCC”) (the regulator of national banks, i.e., banks incorporated under the National Bank Act of 1863, as amended) and the Board of Governors of the Federal Reserve System (“FRB”), pursuant to which Commerce was substantially restricted in its ability to expand. That led Vernon Hill to retire in 2007 (with significant subsequent litigation between him and the bank). In late 2007, TD Bank, N.A., entered into an agreement to buy Commerce Bank in a transaction that closed March 31, 2008, just in time for the Great Recession of 2007-2009. After 2008, Commerce Bank became TD Bank, N.A., or did it? Who exactly is TD Bank, N.A., and where did IT come from?

TD Bank, N.A.

TD Bank, N.A., is an American subsidiary (incorporated under the National Bank Act) of Toronto-Dominion Bank, one of the so-called “Big Five” Canadian banks (and in fact the second-largest Canadian bank after Royal Bank of Canada). The Big Five have found it difficult to expand within Canada for both regulatory and political reasons. For example, the Bank of Montreal acquired Harris Trust Company of Chicago in 1984, and the Canadian Imperial Bank of Commerce purchased the U.S. investment banking firm Oppenheim & Co. in 1997. Accordingly, Toronto-Dominion cast its eyes south of the border as the 21st century arrived. [It is noteworthy that Toronto-Dominion also looked to the U.S. to grow in capital market services when it acquired Waterhouse Securities in 1996, which, in a later merger, led to Toronto-Dominion becoming the largest owner of TD Ameritrade].

In 1852, the Portland Savings Bank opened its doors in Portland, Maine, and then grew through mergers and acquisitions to become Peoples Heritage Bank in 1983. Around 2000, that institution expanded further throughout New England and became Banknorth. In 2004, Toronto-Dominion, looking for opportunities in the U.S., acquired majority ownership of Banknorth, with the American operation becoming TD Banknorth in 2007. By September 2009 all of the Commerce Bank “stores” and all of the TD Banknorth branches had been rebranded as “TD Bank, N.A.” Subsequent acquisitions in September 2010 in North and South Carolina filled in the reach of TD Bank, N.A., branches, which now stretched from Florida to Maine. It is noteworthy that TD Bank, N.A., adopted, by 2009, the slogan that it was “America’s Most Convenient Bank.”

So, to answer the second question posed above, TD Bank, N.A., is a major financial bank in the U.S. that can trace its origins to the “Down-East” of the rocky shores of Maine as a thrift institution. As of 2009, it “OWNED” the remnants of “Mc-Bank.” It has long been recognized that a key factor in mergers or acquisitions is the divergence (if any) between the cultures of the merging entities, and the ability to manage overcoming that divergence. Clearly, the “Banknorth” origins of TD Bank, N.A., are startlingly different from the entrepreneurial “fast-food” focus of “Mc-Bank.” The Harvard Business Review published a lengthy analysis of the Amazon 2017 acquisition of Whole Foods in the October 2, 2018, issue, “One Reason Mergers Fail: The Two Cultures Aren’t Compatible.” The more encyclopediac March 26, 2019, work from Oliver Engert, Becky Kaetzler, Kameron Kordestani, and Andy MacLean of McKinsey & Company, entitled “Organizational Culture in Mergers: Addressing the Unseen Forces,” defines culture, “… as the vision or mission that drives a company, the values that guide the behavior of its people, and the management practices, working norms, and mindsets that characterize how work actually gets done.”

Culture and Bank Mergers

On August 19, 2020, TD Bank, N.A., accepted a Consent Order from the Bureau of Consumer Financial Protection (“CFPB”) requiring the bank to pay to the bureau (or its agent), within ten days, both a $25 million civil penalty AND $97 million to fund “redress payments” to approximately 1.42 million present and former customers of the bank, who from January 1, 2014, through December 31, 2018, were wrongly charged overdraft fees in violation of the Electronic Fund Transfer Act and Regulation E. In addition, the bank was determined to have failed to meet its obligations under the Fair Credit Reporcting Act by refusing to investigate customer claims of error in the information provided to Credit Reporting Agencies. In relation to the Regulation E violations, the bank was found to have repeatedly falsely described the scope, timing, and costs of the various overdraft protection plans. The bank did not provide customers with a full description of overdraft plans and their costs until after a customer had orally “signed up” for a particular coverage (or declined it), although Regulation E requires written consent to be obtained from a customer to pay overdraft fees BEFORE such fees may be charged. Indeed in off-site locations, not a regular “store,” the bank employees frequently failed to bring the overdraft coverage disclosure forms to the places where those employees sought to enroll new customers. The Consent Order also prevents the bank from seeking any tax reduction or offset because of the civil money penalty, and forbids the bank from referring to the payment of that penalty in response to any other civil litigation brought by any bank customer against the bank (for example, a defamation claim based on the bank’s refusal to investigate customer claims of error with respect to credit information furnished by the bank to a credit reporting agency). One cannot help but note, given the institutional histories set out above, that the CFPB in the Consent Order consistently quotes bank employees who refer to the bank’s “stores.”

The Fair Credit Reporting Act, which dates from 1970, has long required furnishers of credit information to timely investigate and respond to claims of error. Regulation E as it relates to overdraft protection plans and fees dates from 2005. Yet these were apparently “foreign requirements” to the staff and management of TD Bank, N.A., a kind of willful blindness unexpected in a large (the seventh-largest in the U.S. by deposits and the eighth largest by total assets), sophisticated financial institution that styles itself as catering to individual customers; i.e., a truly sizable retail bank. Did the lapses in compliance – including flat-out material misstatements – stem from the cultural disparities between Commerce Bank and Banknorth? That is a question that only careful sociological and economic analysis can answer, but the August 19, 2020, Consent Order certainly suggests that bank examiners ought to look beyond the immediacy of files and financial statements.


©2020 Norris McLaughlin P.A., All Rights Reserved
For more articles on finance, visit the National Law Review Financial Institutions & Banking section.

Ransomware Payments Can Lead to Sanctions and Reporting Obligations for Financial Institutions

With cybercrime on the rise, two U.S. Treasury Department components, the Office of Foreign Assets Control (“OFAC”) and the Financial Crimes Enforcement Network (“FinCEN”), issued advisories on one of the most insidious forms of cyberattack – ransomware.

Ransomware is a form of malicious software designed to block access to a system or data.  The targets of ransomware attacks are required to pay a ransom to regain access to their information or system, or to prevent the publication of their sensitive information.  Ransomware attackers usually demand payment in the form of convertible virtual currency (“CVC”), which can be more difficult to trace.  Although ransomware attacks were already on the rise (there was a 37% annual increase in reported cases and a 147% increase in associated losses from 2018 to 2019), the COVID19 pandemic has exacerbated the problem, as cyber actors target online systems that U.S. persons rely on to continue conducting business.

OFAC

The OFAC advisory focuses on the potential sanctions risks for those companies and financial institutions that are involved in ransomware payments to bad actors, including ransomware victims and those acting on their behalf, such as “financial institutions, cyber insurance firms, and companies involved in digital forensics and incident response.”  OFAC stresses that these payments may violate US sanctions laws or OFAC regulations, and encourage future attacks.

OFAC maintains a consolidated list of sanctioned persons, which includes numerous malicious cyber actors and the digital currency addresses connected to them.[1]  Any payment to those organizations or their digital currency wallets or addresses, including the payment of a ransom itself, is a violation of economic sanctions laws regardless of whether the parties involved in the payment knew or had reason to know that the transaction involved a sanctioned party.  The advisory states that “OFAC has imposed, and will continue to impose, sanctions on these actors and others who materially assist, sponsor, or provide financial, material, or technological support for these activities.”

In addition to violating sanctions laws, OFAC warned that ransomware payments with a sanctions nexus threaten national security interests.  These payments enable criminals to profit and advance their illicit aims, including funding activities adverse to U.S. national security and foreign policy objectives.  Ransomware payments also embolden cyber criminals and provide no guarantee that the victim will regain access to their stolen data.

Any payment to those organizations or their digital currency wallets or addresses, including the payment of a ransom itself, is a violation of economic sanctions laws regardless of whether the parties involved in the payment knew or had reason to know that the transaction involved a sanctioned party.

OFAC encourages financial institutions to implement a risk-based compliance program to mitigate exposure to potential sanctions violations.  Accordingly, these sanctions compliance programs should account for the risk that a ransomware payment may involve a Specially Designated National, blocked person, or embargoed jurisdiction.  OFAC encouraged victims of ransomware attacks to contact law enforcement immediately, and listed the contact information for relevant government agencies.  OFAC wrote that it considers the “self-initiated, timely, and complete report of a ransomware attack to law enforcement to be a significant mitigating factor in determining an appropriate enforcement outcome if the situation is later determined to have a sanctions nexus.”  OFAC will also consider a company’s cooperation efforts both during and after the ransomware attack when evaluating a possible outcome.

Such cooperation may also be a “significant mitigating factor” in determining whether and to what extent enforcement is necessary.

FinCEN

FinCEN’s advisory also encourages entities that process payments potentially related to ransomware to report to and cooperate with law enforcement.  The FinCEN advisory arms these institutions with information about the role of financial intermediaries in payments, ransomware trends and typologies, related financial red flags, and effective reporting and information sharing related to ransomware attacks.

According to FinCEN, ransomware attacks are growing in size, scope, and sophistication.  The attacks have increasingly targeted larger enterprises for bigger payouts, and cybercriminals are sharing resources to increase the effectiveness of their attacks.  The demand for payment in anonymity-enhanced cryptocurrencies has also been on the rise.

FinCEN touted “[p]roactive prevention through effective cyber hygiene, cybersecurity controls, and business continuity resiliency” as the best ransomware defense.  The advisory lists numerous red flags designed to assist financial institutions in detecting, preventing, and ultimately reporting suspicious transactions associated with ransomware payments.  These red flags include, among others: (1) IT activity that shows the existence of ransomware software, including system log files, network traffic, and file information; (2) a customer’s CVC address that appears on open sources or is linked to past ransomware attacks; (3) transactions that occur between a high-risk organization and digital forensics and incident response companies or cyber insurance companies; and (4) customers that request payment in CVC, but show limited knowledge about the form of currency.

Finally, FinCEN reminded financial institutions about their obligations under the Bank Secrecy Act to report suspicious activity, including ransomware payments.  A financial institution is required to file a suspicious activity report (“SAR”) with FinCEN if it knows, suspects, or has reason to suspect that the attempted or completed transaction involves $5,000 or more derived from illegal activity.  “Reportable activity can involve transactions . . . related to criminal activity like extortion and unauthorized electronic intrusions,” the advisory says.  Given this, suspected ransomware payments and attempted payments should be reported to FinCEN in SARs.  The advisory provides information on how financial institutions and others should report and share the details related to ransomware attacks to increase the utility and effectiveness of the SARs.  For example, those filing ransomware-related SARs should provide all pertinent available information.  In keeping with FinCEN’s previous guidance on SAR filings relating to cyber-enabled crime, FinCEN expects SARs to include detailed cyber indicators.  Information, including “relevant email addresses, Internet Protocol (IP) addresses with their respective timestamps, virtual currency wallet addresses, mobile device information (such as device International Mobile Equipment Identity (IMEI) numbers), malware hashes, malicious domains, and descriptions and timing of suspicious electronic communications,” will assist FinCEN in protecting the U.S. financial system from ransomware threats.

[1] https://home.treasury.gov/news/press-releases/sm556


© Copyright 2020 Squire Patton Boggs (US) LLP
For  more articles on cybersecurity, visit the National Law Review Communications, Media & Internet section.

Hawaii Tightens Ban-the-Box Law, Further Limiting Use of Past Criminal History in Work Decisions

Hawaii has narrowed the scope of what employers can consider regarding an individual’s conviction history when making employment decisions.

Hawaii employers have long been required to limit their consideration of felony and misdemeanor convictions to a 10-year lookback period, unless they fell within one of the statutory exemptions as part of its longstanding “ban the box” legislation. State law has further required employers to apply a “rational relationship” test before denying a prospective or current employee a position following a background check, which means an employer may only consider those convictions occurring in the permissible time period if there is a “rational relationship” between the convicted crime and the prospective job.

The Hawaii legislature has taken further steps to narrow the scope of what employers can consider regarding an individual’s conviction history. The concern was that, without further change, the “rational relationship” test would still be ripe for subjectivity, creating a potential for inconsistent application due to express or unconscious bias, which can result in discrimination against a person who has long since paid their debt to society and who poses little to no risk to the employer or to the public. Consequently, on September 15, 2020, the Governor of Hawaii signed into law Act 051 (20), amending Hawaii Revised Statutes Section 378-2.5 by reducing the “lookback” period and differentiating between felonies and misdemeanors. The intent was to minimize any possible conscious or unconscious bias that arises when an employer views an “old” crime when making employment decisions.

Felonies older than seven years and misdemeanors older than five years are no longer relevant toward job suitability determinations, unless they fall within one of the existing 18 statutory exemptions, e.g., Department of Education employees. Even with these distinctions and limited “lookbacks,” employers must still apply the “rational relationship” test when making employment decisions.

Additionally, the suitability determination with respect to relevant criminal history may only occur after the applicant has received a conditional job offer.

If an employer has extended a conditional job offer to an applicant or offered a current employee a promotion and the person’s background check reveals a criminal history for a Hawaii-based position, seek legal counsel to review any potential exposure, if applicable, arising out of the reduced “lookback” period and application of the “rational relationship” test before denying employment.


Jackson Lewis P.C. © 2020
For more articles on employment law, visit the National Law Review Labor & Employment section

U.S. Government Announces One of Its Largest Customs Fraud Settlements

The Department of Justice last week announced a $22.8 million settlement involving customs duty fraud—one of the largest False Claims Act settlements involving customs duties to date. A former company employee reported the alleged violations against German multinational chemical and gas company, Linde AG, and its American subsidiary, Linde Engineering North America, Inc. (collectively, “Linde”). The whistleblower, who will receive $3.78 million for reporting the alleged violations, alleged that Linde fraudulently evaded customs duties by falsifying invoices and incorrectly describing imports in customs documents, both in terms of the characteristics of the imported products and their cost.

Importers are obligated to provide U.S. Customs and Border Protection with accurate reporting information, which allows the government to assess duties properly on U.S. imports. Under the False Claims Act (FCA), any knowing failure to accurately report or pay the full amount of customs duties is a violation of the law. A company that knowingly evades customs duties risks liability under the FCA, potentially resulting in treble damages and penalties. FCA is a powerful and essential tool used to combat fraud against the government, including customs and duties fraud, which is the second-largest source of federal revenue collected by the U.S. Government after taxes.

The complaint alleges that Linde misclassified its imported pipe products under the wrong Harmonized Tariff Schedule (“HTS”) codes to decrease or avoid paying antidumping and countervailing (“AD/CV”) duties. Goods imported into the U.S. are classified by numerical HTS codes tied to specific customs duty rates, including AD/CV duties when applicable. AD/CV duties protect American manufacturers and industries from unfair trade practices, specifically “dumping” of imports into the U.S. market for less than market value. The duties also protect import subsidies by foreign governments, which benefit importers at the expense of U.S. manufacturers. Importers must accurately identify the HTS codes and the amount of AD/CV duties owed in its customs entry documents, including the summary customs, Form 7501, submitted with every import. An FCA violation occurs when an importer knowingly breaks these rules.

The complaint alleges that Linde also understated the value of its imported goods by failing to disclose to the government “assists”—costs that add value to imported goods not reflected in the price paid to the invoicing vendor. In one instance, Linde purchased and shipped raw material to overseas vendors, who manufactured and assembled the product for importation into the U.S. Linde then imported the completed assembled product without including the cost of the foreign raw materials in entry forms or invoices submitted to U.S. Customs. The value of imported goods determines the duties; any knowing undervaluation of imports is a False Claim Act violation. The value of imported goods, including any assists, also must be identified in Form 7501.

The complaint alleged that Linde paid 50 percent less in import duties than similar companies, even while Linde moved its American manufacturing operations overseas and increased its imports from $750,000 to $268 million in four years. Under FCA, a person who reports fraud against the government (a whistleblower) resulting in a qui tam lawsuit that recovers money owed to the government is entitled to an award of between 15% and 30% of the amount recovered.  These awards are a strong incentive to encourage those with knowledge of fraud on the U.S. Government to come forward. Although insiders typically bring cases under the False Claims Act, cases involving customs fraud have been brought by non-insiders, including competitors, who are often well-positioned to identify fraudulent customs practices.


© 2020 by Tycko & Zavareei LLP
For more articles on fraud, visit the National Law Review Criminal Law / Business Crimes section.

This is Big: Visa Pathway Opens for Foreign Workers Seeking H-1B; H-2B; L-1 and J-1 Visa Stamps

An important court ruling by Judge Jeffrey S. White of the U.S. District Court for the Northern District of California has opened a visa pathway for temporary workers and their employers.

On June 22, 2020 President Trump issued a Presidential Proclamation 10052 (“Visa Ban”) which suspended the issuance of four types of visas:  H-1B; H-2B; L-1 and J-1, and also prohibited the admission into the U.S. until at least December 31, 2020 of persons subject to this Visa Ban.  Our past alerts on this Visa Ban may be accessed here.

The President claimed that he issued this Visa Ban purely for domestic economic reasons: to protect the U.S. labor force in the wake of the pandemic. But there is a strong argument that the President overstepped his authority in issuing this Visa Ban, since the underlying rationale of this Proclamation related to domestic policy-making (as opposed to keeping immigrants out of the U.S. for national security reasons).  Further, by a stroke of his pen, the President wiped out the availability of four categories of work visas specifically enacted into law by Congress.

Because the Proclamation allows for such limited exceptions to its broad reach, this Visa Ban has adversely impacted thousands of employers and temporary workers across the United States.  People who are subject to it simply cannot get L-1 or H-1B visa stamps at US Consulates abroad while the ban is in place (unless they fit into an exception/exemption based on the nature of their work).

As noted above, yesterday, the U.S. District Court for the Northern District of California upheld a legal challenge to this Visa Ban filed by plaintiffs including Intrax, Inc., the U.S. Chamber of Commerce (AmCham); the National Association of Manufacturers (NAM), the National Retail Federation, and TechNet.  The above-referenced association plaintiffs had filed the lawsuit on behalf of their association members claiming that the Proclamation exceeded the President’s authority and that it violated the Administrative Procedures Act (APA).   Now that the federal court in California has enjoined this Ban, members of the plaintiff associations can benefit from the injunction.  This means if an employer can show it is a member of one of these associations, or becomes a member of one of them, it can argue that the injunction applies both (a) when its employees apply for a visa abroad in one of these categories, and (b) when seeking to enter the U.S. in one of these otherwise banned visa categories.  

Joining a Plaintiff association is a straightforward matter.  For example, a company can join the American Chamber of Commerce by paying a fee of $250. U.S. Consulates should honor proof of membership in a plaintiff association in considering visa applications for one of these impacted visa categories.

It is rare to be able to take advantage of a legal ruling in this way, and all U.S. employers who depend upon their valued H-1B, H-2B, L-1 and J-1 workers, should immediately try to leverage this opportunity presented by this injunction.


©1994-2020 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.

ARTICLE BY Susan J. Cohen of Mintz
For more articles on visas, visit the National Law Review Immigration section.

Election Season and the Workplace, Part 1: Employee “Free Speech” and Political Activities

With Election Day just around the corner, we’ll be highlighting some of the issues facing employers in a two-part series on elections and the workplace. In this first installment, we’ll look at employee protections around political speech and activity both in and outside the workplace. In Part 2, we’ll address statutory leave entitlements for employees to vote or engage in other political activities.

Political Speech in the Workplace

Political speech and activity in the workplace is a recurring source of employer concern, for a number of reasons. First, when these discussions or activities occur during working hours, they can impact performance, productivity, or even cross the line into unlawful bullying or harassment.

In addition, if the employer is a tax-exempt organization, certain political speech can also implicate the organization’s tax-exempt status. Many tax exempt-organizations are subject to significant restrictions on lobbying and political activities in exchange for the public subsidy that they receive. For example, a 501(c)(3) organizations may lose their tax-exempt status if they engage in political campaign activities or if a substantial part of its activities involve lobbying. Speech by an employee that constitutes political campaign or lobbying activity may be attributed to the organization if it can be inferred that an employee’s speech is made as a representative of the organization or that the speech has been ratified by the organization. This could happen, for example, if an employee, using their own social media account that the employee also uses to engage in speech on behalf of the organization, engages in lobbying activity by urging followers to contact their state representative to advocate for the adoption or rejection of proposed legislation.

Finally, when employees attend political rallies or support causes – for example, on social media – they may (intentionally or not) criticize or create a conflict of interest with their employer. How far employers can go to restrict employee speech and activity is a complicated question, governed by several sources of law.

Employee “Free Speech.”

Despite popular misconception, there is no general right to “free speech” in a private sector workplace.  As an initial matter, because the U.S. Constitution is primarily concerned with issues that involve state actors rather than private actors, the First Amendment does not prevent private employers from prohibiting political speech in the workplace.  Speech by public sector employees may be protected by the First Amendment, but only to the extent it involves a matter of public concern.  Therefore, subject to the limited exceptions discussed below, private sector employers are generally free to prohibit and discipline employees for discussing politics at work.

Free speech protections can extend to private sector employees by statute.  For example, Connecticut General Statute § 31-51q prohibits employers from taking any adverse action against employees for exercising their First Amendment rights, provided that such activity does not interfere with the employee’s job performance or the employment relationship.  As in the context of public sector free speech protections, courts have interpreted this statute to only protect statements made outside of the scope of employment, and not speech pursuant to official duties (e.g., reports of labor law or payroll violations).

In addition, Section 7 of the National Labor Relations Act (“NLRA”), which applies to both union and non-union employees, protects certain “concerted activities” of employees for the purposes of “mutual aid or protection.”  Political speech or activity that is unrelated to employment – for example, an employee distributing campaign literature encouraging co-workers to vote for their candidate or political party of choice – would not be covered or protected by the NLRA. The NLRA therefore does not prevent employers from prohibiting these purely political discussions or activities in the workplace.

However, political speech may be protected by the NLRA when it relates to the terms or conditions of employment.  For example, conversations regarding wages, hours, workplace safety, company culture, leaves, and working conditions may be deemed protected concerted activity and therefore be protected.  An employee who encourages co-workers to vote for a candidate because the candidate supports an increase in the minimum wage might claim protection under the NLRA.

The same rule generally applies to employee advocacy.  When employees are engaging in advocacy unrelated to employment, the National Labor Relations Board has taken the position that employees are simply acting “in the interest of the community at large and in furtherance of [their] own political agenda.”  For example, a construction worker engaging in advocacy involving police reform at a protest or before a legislative body would likely not be protected because the topic of the advocacy is unrelated to the employee’s job as a construction worker.  However, if the same construction worker was advocating before a legislative body in support of safety regulations that would impact the jobsite, the employee’s advocacy would likely qualify as protected concerted activity.

Therefore, despite that employers have broad authority to prohibit political discussions at work, employers should ensure that their policies and practices do not infringe upon rights granted to employees under state law or the federal NLRA.

Lawful Outside Activity/Off-Duty Conduct Statutes.

Many states have laws that prohibit adverse action against employees based on lawful activities outside the workplace, including political activities. For example:

  • In approximately a dozen states, employers are prohibited from preventing employees from participating in politics or becoming candidates for public office. New York Labor Law § 201-d prohibits employers from discharging or otherwise discriminating against employees because of their “political activities outside of working hours, off of the employer’s premises and without use of the employer’s equipment or other property, if such activities are legal.”  Political activities are defined to include: (1) running for public office, (2) campaigning for a candidate for public office, or (3) participating in fund-raising activities for the benefit of a candidate, political party, or political advocacy group.  Similar laws exist in CaliforniaLouisiana, and Minnesota, among other states.
  • Other states – including DelawareFloridaMassachusetts, and New Jersey– prohibit employers from attempting to influence an employee’s vote in an election. For example, in Florida, “[i]t is unlawful for any person … to discharge or threaten to discharge any employee … for voting or not voting in any election, state, county, or municipal, for any candidate or measure submitted to a vote of the people.”   A dozen or so states approach this issue in a more limited fashion by prohibiting employers from attaching political messages to pay envelopes.
  • At least two states, Illinois and Michigan, prohibit employers from keeping a record of employee’s associations, political activities, publications, or communications without written consent.
  • Washington, D.C. prohibits discrimination in employment on the basis of political affiliation. Despite its seemingly broad scope, this statute has been interpreted to only protect political party membership and not (1) membership in a political group, or (2) other political activities, such as signing a petition.

These laws vary considerably from state to state, so it is important for employers to consult the statutes in each jurisdiction in which they operate and ensure that their policies and practices are compliant.

Employer Access to Employee Social Media.

As employees turn to social media to discuss the election and other political and social issues, employers should remain mindful of restrictions on their ability to monitor or discipline employees for their social media use.  In addition to potential issues under the NLRA and state-level free speech guarantees, the federal Stored Communications Act (“SCA”) and a number of state statutes also regulate an employer’s ability to monitor employee social media activity.

The SCA affords privacy protections to certain electronic communications.  Although the law predates the advent of social media as we know it today, courts have applied it to unauthorized access of employee social media accounts.  Therefore, employers across the country should exercise caution before accessing employees’ social media accounts without their authorization or coercing employees to turn over information posted on social media.  Such actions not only carry risk under the SCA, but also under various state laws.  For example:

  • Approximately half a dozen states – including ColoradoNew Hampshire, and Vermont – prohibit employers from requesting that employees change their privacy settings to make information on social media accounts visible to their employer.
  • In more than two dozen states – including CaliforniaIllinoisLouisianaMarylandNew Jersey, and Virginia – employers are prohibited from requesting social media usernames and passwords from employees.

Despite these limitations, employers generally have significantly greater leeway to monitor social media activity conducted on the employer’s systems when such monitoring is pursuant to the employer’s written policy.  In addition, many of the statutes prohibiting employers from requesting social media log-in information contain exceptions that allow employers to request this information for the purpose of accessing an employer-owned device or account.  Employers relying on their internal policies to justify action with an impact on employees should always be mindful to interpret and apply those policies in a consistent and otherwise non-discriminatory manner.

*     *     *

All signs point to this year’s election season being one of the more contentious in U.S. history.  Given the wide range of federal, state, and local laws protecting employee speech and political activities, employers should: (1) review their policies to ensure that they are compliant with the laws in each jurisdiction in which they operate, (2) communicate these policies to managers and supervisors and provide effective training where necessary; and (3) monitor compliance on a regular basis.


© 2020 Proskauer Rose LLP.
For more articles on the election, visit the National Law Review Election Law / Legislative News section.