The National Law Forum

ISIS’s Destruction of Antiquities and Ancient Sites

Iconoclasm and Looting

The recent destruction of sculptures and other objects in the Mosul Museum, as well as the ancient cities and archaeological sites of Nimrud, Hatra, and Dur Sharrukin^[1]by the Islamic State of Iraq and Syria (ISIS), sometimes also referred to as the IslamicState of Iraq and the Levant (ISIL), has been widely condemned.^[2]Many have identified the motivation behind the destruction as an ideology-driven iconoclasm. [UNESCO Director-General, Irina Bokova, condemned the destruction, noting that “the attack was in direct violation to the most recent Security Council resolution 2199 that condemns the destruction of cultural heritage and adopts legally-binding measures to counter illicit trafficking of antiquities and cultural objects from Iraq and Syria.” See “Iraq: UNESCO Outraged over Terrorist Attack against Mosul Museum,” UN News Centre, Feb. 26, 2015. To view a video of the destruction at the museum, see Ben Wedeman and Dana Ford, “Video Shows ISIS Militants Destroying Antiquities in Iraq,” CNN, Feb. 27, 2015. See also Kareen Shaheen, “Isis fighters destroy ancient artefacts at Mosul museum,” The Guardian, Feb. 26, 2015.]

Iconoclasm and looting

Art historian Simon Schama, placing ISIS’s actions in the context of many other historical iconoclasms, observed that:

[t]he obliterators . . . act from the same instinct of cultural panic that the supreme works of the past will lead people astray from blind, absolute obedience. Neither beauty nor history have the least interest for them because they live in and force others to inhabit a universe of timeless subjection. The mere notion that the achievements of humanity might rise to the level of sublimity is itself a sacrilegious affront. In a way this is a backhanded compliment to the power of images. And yet when this puerile and fearful instinct leads to irreversible acts of annihilation, it is not only their own immediate culture that is the victim but the entirety of humanity, which loses a piece of its memory as surely as if a slice of our collective brain had been removed by a mad lobotomist. [Simon Schama, “Artefacts under Attack,” The Financial Times, Mar. 13, 2015.]

The Taliban’s demolition of the Bamiyan Buddhas in March 2001 exemplifies this “cultural cleansing,” but it also shows how changeable iconoclasts’ views can be. In 1999, shortly after the Taliban assumed power in Afghanistan, the Taliban Minister of Culture “spoke about the respect due to pre-Islamic antiquities and also mentioned the risk of retaliation against mosques in Buddhist countries. . . . He made clear that, though there were no Buddhist believers in Afghanistan, ‘Bamiyan would not be destroyed but, on the contrary, protected.’” [Pierre Centlivres, “The Death of the Bamiyan Buddhas,” Middle East Institute website, Dec. 2009.] However, on February 26, 2001, Taliban leader Mullah Muhammad Omar “issued a decree ordering the elimination of all non-Islamic statues and sanctuaries in Afghanistan.” [Id.] Within weeks, the buddhas had been destroyed.

Similarly, in 2012, the Al-Qaeda-related Islamic group Ansar Dine engaged in widespread ideologically-driven destruction of mosques, monuments, and manuscripts in Timbuktu, Mali [Federico Lenzerini, “The Role of International and Mixed Criminal Courts in the Enforcement of International Norms Concerning the Protection of Cultural Heritage,” in Francesco]. “Timbuktu’s ancient mosques and monuments,” observers noted, “built of mud and limestone bricks, [had] endured centuries [until Ansar Dine] swept across Mali’s north. . . . Intolerant of the city’s mystical Sufi traditions, they banned music, and took hoes, pickaxes and bulldozers to the shrines where saints were buried, and which they considered idolatrous. 16 mausoleums were destroyed, including two that sat alongside the vast 14th-century Djingareyber mosque.” In the case of the monuments of Timbuktu, the destruction of the buildings was itself not enough. Complete elimination – including making it impossible for the monuments to be rebuilt with the same materials — was the goal. After the monuments were destroyed, Ansar Dine “carried the clay obtained from the monuments outside the city . . . to prevent them from being rebuilt with the same clay in the future.” [Lenzerini, at 61.]

The ravages of recent weeks are only the latest examples of ISIS’s targeting of cultural heritage, erasing cultural sites and symbols they find offensive to their worldview or to establish a “pure” narrative of their own preeminence. In July 2014, ISIS destroyed the 14th-century mosque that housed the Tomb of Jonah. [See Mark Movesian, “Why Did ISIS Destroy the Tomb of Jonah?” First Things, July 28, 2014; see also “Video Shows Islamic State Blowing Up Iraq’s Tomb of Jonah,” NPR, July 25, 2014.]

However, iconoclasm and “cultural cleansing” do not appear to be ISIS’s sole purpose in destroying ancient sites. While ISIS declares that “ancient art [is] idolatry that must be destroyed,” reports indicate that the destruction of that ancient art is part of a looting scheme that monetizes that ancient art to fund ISIS’s activities. “[T]he archaeological devastation is not about ideology,” David Kohn hasreported, “but income. . . . [ISIS] often brings in contractors who use bulldozers to dig up sites as efficiently as possible.” Louise Shelley, writing in the current special issue of Foreign Affairs, describes the sources of ISIS’s funding, including the sale of oil, but also “the sale of counterfeit cigarettes, pharmaceuticals, cell phones, antiquities, and foreign passports.” [Louise Shelley, “Blood Money: How ISIS Makes Bank,” Foreign Affairs, Mar. 2015.]

War Crimes

United Nations Secretary General Ban Ki-moon condemned the destruction, designating the actions as “war crimes,” and issuing a statement calling on the international community “to swiftly put a stop to such heinous terrorist activity and to counter the illicit traffic in cultural artefacts.” [Kareem Shaheen, “Isis attacks on ancient sites erasing history of humanity, says Iraq,” The Guardian, Mar. 9, 2015.] UNESCO Director-General Irina Bokova likewise issued a statement after the destruction of Nimrud stating that she had “alerted the president of the Security Council as well as the Prosecutor of the International Criminal Court” concerning the unlawfulness of the destruction under international law.

International law protects cultural heritage from destruction and plunder during armed conflict (both international and internal) through a variety of instruments. Many of these instruments impose obligations on countries, not individuals, setting out the rules of war. [ Lenzerini, at 41-42.] These instruments include Convention (IV) Respecting the Laws and Customs of War on Land of 1907,^[3]the 1954 Hague Convention for the Protection of Cultural Property in the Event of Armed Conflict (which imposes not only obligations to safeguard cultural heritage during international/cross-border conflicts, but also, importantly, during internal conflicts), the two 1977 Protocols to the Geneva Conventions on Humanitarian Law of 1949,^[4] the Second Protocol to the 1954 Hague Convention,^[5] and the 2003 UNESCO Declaration on the Intentional Destruction of Cultural Heritage.^[6] Individual criminal liability for the destruction of cultural heritage was slower to develop, but is embodied in the statutes of the International Criminal Tribunal for the Former Yugoslavia and the International Criminal Court (ICC), which, like the 1954 Hague Convention, imposes criminal liability not only for actions taken during international conflicts, but also during internal conflicts. ^[7]

In the case of individual criminal responsibility for ISIS militants for the destruction in Mosul, Nimrud, and elsewhere, an initial obstacle lies in neither Iraq nor Syria being party to the Rome Statute. However, while the ICC’s jurisdiction is limited, states may accept the court’s jurisdiction for a particular case. Even in the absence such state acceptance, the ICC has jurisdiction in cases in which the Security Council refers the matter to the prosecutor. Either option, however, faces steep political obstacles.

Challenges to enforcement do not reduce the importance of establishing and maintaining the international legal norms that have developed in this area. Resolutions and declarations by the United Nations and the international community’s condemnation of these acts of destruction carry significance in themselves, even though they do not halt the acts themselves. It is also important to recognize that treaty-based legal protections for cultural heritage not only have deep roots in the norms of customary international law, but they also contribute to the articulation and development of those customary international law norms, which have an independent legal validity in international law. [Francesco Francioni and Federico Lenzerini, “The Destruction of the Buddhas of Bamiyan and International Law,” 14 EJIL 619, 634 (2003).]

Still, as Simon Schama notes:

the wringing of hands over this loss to humanity will have no effect on those for whom it is as nothing compared with the claims of divinity. It is understandable that, when asked on BBC Radio 4 if he would countenance military intervention to save Nimrud, the Assyriologist John E. Curtis answered in the affirmative. But a Unesco strike squad belongs, alas, to comic book dreams. Even before its planes could be fueled, the bulldozer boys will be congratulating themselves on having reduced masterpieces to rubble and dust. [Simon Schama, “Artefacts under Attack,” The Financial Times, Mar. 13, 2015.]

ARTICLE BY

Kevin P. Ray

Greenberg Traurig, LLP

_{[1] Kareem Shaheen, “Isis Ransacking of Ancient Assyrian City Confirmed by Iraq’s Head of Antiquities,” The Guardian, Mar. 12, 2015. (“[Dur-Sharrukin’s] city walls were razed, and some elements of the temples, but we don’t know the exact extent [of the damage],” Iraq’s director of antiquities, Qais Rasheed, told Reuters. “Looting took place, and then the razing.”); Anne Barnard, “Race in Iraq and Syria to Record and Shield Art Falling to ISIS,” The New York Times, Mar. 8, 2015. (“In just a few days last week, [ISIS] destroyed parts of two of northern Iraq’s most prized ancient cities, Nimrud and Hatra. On Sunday, residents said militants destroyed parts of Dur Sharrukin, a 2,800-year-old Assyrian site near the village of Khorsabad.”).}

_{[2] UNESCO Director-General, Irina Bokova (“The destruction of Hatra marks a turning point in the appalling strategy of cultural cleansing under way in Iraq.”)(“Islamic State ‘Demolishes’ Ancient Hatra Site in Iraq,” BBC, Mar. 7, 2015; Thomas P. Campbell, Director of the Metropolitan Museum of Art (“It’s the erasure of human identity, and nothing less than cultural cleansing.”)(Kia Makarechi, “At Persian New Year Gala, Met Museum C.E.O. Condemns ISIS’s “Sickening” Destruction of Antiquities,” Vanity Fair, Mar. 13, 2015. See also Graham Bowley and Robert Mackey, “Destruction of Antiquities by ISIS Militants is Denounced,” The New York Times, Feb. 27, 2015; Sturt Manning, “Why ISIS Destroys Antiquities,” CNN, Mar. 9, 2015; Zack Beauchamp, “ISIS’s War on History: 11 Cultural Treasures Lost Forever to the Group and Its Predecessors,” Vox.com, Mar. 11, 2015.}

_{[3] Convention (IV) Respecting the Laws and Customs of War on Land and Its Annex: Regulations Concerning the Laws and Customs of War on Land, The Hague, 18 Oct. 1907. (The Regulations annexed to the Convention state: “In sieges and bombardments all necessary steps must be taken to spare, as far as possible, buildings dedicated to religion, art, science, or charitable purposes, historic monuments, hospitals, and places where the sick and wounded are collected, provided they are not being used at the time for military purposes. It is the duty of the besieged to indicate the presence of such buildings or places by distinctive and visible signs, which shall be notified to the enemy beforehand.”).}

_{[4] Protocol Additional to the Geneva Conventions of 12 August 1949, and Relating to the Protection of Victims of International Armed Conflicts (Protocol I), 1125 UNTS 5 (Article 53 provides: “Without prejudice to the provisions of the Hague Convention for the Protection of Cultural Property in the Event of Armed Conflict of 14 May 1954, and of other relevant international instruments, it is prohibited: (a) to commit any acts of hostility directed against the historic monuments, works of art or places of worship which constitute the cultural or spiritual heritage of peoples; (b) to use such objects in support of the military effort; (c) to make such objects the object of reprisals.”); and Protocol Additional to the Geneva Conventions of 12 August 1949, and Relating to the Protection of Victims of Non-International Armed Conflicts (Protocol II), 1125 UNTS 609 (Article 16 provides: “it is prohibited to commit any acts of hostility directed against historic monuments, works of art or places of worship which constitute the cultural or spiritual heritage of peoples, and to use them in support of the military effort.”).}

_{[5] Second Protocol to the Hague Convention of 1954 for the Protection of Cultural Property in the Event of Armed Conflict, 1999, 2253 UNTS 172.}

_{[6] Article VII, in proclaiming the principle of individual criminal responsibility for acts of destruction of cultural heritage, affirms: “States should take all appropriate measures, in accordance with international law, to establish jurisdiction over, and provide effective criminal sanctions against, those persons who commit, or order to be committed, acts of intentional destruction of cultural heritage of great importance for humanity, whether or not it is inscribed on a list maintained by UNESCO or another international organization.”).}

_{[7] UN General Assembly, Rome Statute of the International Criminal Court (last amended 2010), 17 July 1998, ISBN No. 92-9227-227-6. (Article 8(2)(b)(IX) provides that the term ‘war crimes’ includes “Intentionally directing attacks against buildings dedicated to religion, education, art, science or charitable purposes, historic monuments, hospitals and places where the sick and wounded are collected, provided they are not military objectives.” Article 8(2)(e)(IV) imposes a corresponding liability during internal conflicts, stating that war crimes includes, in conflicts not of an international character, “Intentionally directing attacks against buildings dedicated to religion, education, art, science or charitable purposes, historic monuments, hospitals and places where the sick and wounded are collected, provided they are not military objectives.”).}

Crowdfunding? Really? Crowdfunding Rule under the JOBS Act

Count me a Luddite when it comes to social media in general, and more specifically, the supposed potential for crowdfunding and raising capital for start-ups and small businesses. My skepticism about crowdfunding admittedly has its roots in the resistance to public solicitation of non-public offerings that 20 years in state securities regulation embedded in me. Publicly solicited “private placements” before the advent of Rule 506(c) were all but certainly fraudulent. But, times (and exemptions) change.

Now, the word on the street is that the SEC has dragged its feet too long on promulgating its Congressionally mandated rule on crowdfunding under the JOBS Act, so the Republican House is going to take matters into its own hands and legislate a more rational crowdfunding exemption than the provision in the JOBS Act and proposed rule, without the need for SEC action. I can’t wait to see that hummer!

Since the subject of allowing crowdfunding for investments first arose in the initial rumblings that preceded the JOBS Act, there have been literally hundreds of articles, blogs and other commentaries tooting crowdfunding as the panacea for raising capital for start-ups and small businesses with the result that all sorts of new jobs would be created (a claim based more in hyperbole than empirical evidence.) Jobs? Perhaps some, but enough to make a national economic difference? Really? There has been at least one University of Colorado law review article on comparable legislation in Great Britain, and I have assisted a former securities law student of mine at the James E. Rogers College of Law, University of Arizona, in preparing her own article on crowdfunding that includes a review of British as well as other European capital raising crowdfunding regimes.

Most of these articles on crowdfunding appear to have been written by people who hope to profit providing services to general public crowdfunding principals once it’s lawful. A good share of them have been observations and opinions written by lawyers who regularly critique federal and state regulations, proposals and market developments. To one extent or another, the articles focus on Congress versus the SEC, or the needs for capital raising versus securities regulations.

These proselytizers and commentators have all but ignored what is truly the other side of the investment equation—the investors. I’m not talking about fraudsters. That dirty element will worm its way into whatever system is finally implemented, to one extent or another. I’m focusing here on the people who send their money to hopeful, legal crowdfunding issuers.

If the proponents of investment crowdfunding can run the “start-up businesses create jobs” pennant up the rhetorical flagpole, it’s only fair to allow me to hoist the “most start-up enterprises fail within five years” banner up right along next to it.

The unfortunate reality is that start-up businesses make horrible investments. Few of them survive at all, let alone turn a profit any time soon, let alone provide a return to investors. Investing in start-ups is like hunting ducks with a rifle, and few investors have enough “bullets” to fire.

Entrepreneurs are eternally enthusiastic, energetic and optimistic. They have to be. For many years, the dreamers (and their counsel) urged Congress and the SEC that “if only the ban on public solicitation and advertising were lifted, we could all fund our private placements.” Now that that cat is out of the bag with Rule 506(c), at least for accredited investors, the chant has shifted (predictably) to, “if only we could use crowdfunding to publicly solicit and advertise to reach non-accredited investors.”

If a start-up entrepreneur—I’ll call him “Fred”—is ready to turn to looking for funding from strangers, I think it fair to draw an inference or three about what has happened to date. First, Fred is tapped out on his own funds. Second, the bank has said or would say “no” to a loan, based on Fred’s lack of collateral or some other deficiency. Third, anyone Fred knows (and he may not know anyone) who might invest in his business—those people and businesses with whom he has a “pre-existing business or personal relationship”—have either invested as much as they are going to, or have found ways to be “on vacation in the Australian outback and hard to reach” when Fred has come calling for money the first time or for more later.

At this point, many entrepreneurs would keep working until they had saved up enough money of their own, or grew to qualify for that bank loan. A lot of business owners I’ve encountered have no interest in selling equity in their businesses to investors. But there are certainly those who are willing to do so. Whatever, at this point, “Fred” has now gone through all his own cash. His business and personal profile are insufficient to qualify for a bank loan, even if government subsidized. In other words, the professional lenders won’t touch him. Further, anyone who knows him and/or his business who might invest have either done so or won’t. With investment crowdfunding, Congress and several state legislatures and regulators have made the public policy decision to let Fred now turn to perfect strangers, the general public. So, the smallest, riskiest, least sophisticated, most poorly funded, most likely to fail business owners can turn now to the general public for investments when all the professionals and close-in people, those in the best position to know Fred and evaluate his company’s investment potential, have said “no” or “no more.”

To me, this is a public policy that makes no sense. If Congress wants to promote investment in start-ups and small businesses to create jobs, let them direct the Small Business Administration to ease their guarantee standards for SBA loans. Oh, we can’t do that because the SBA would go broke guaranteeing bad loans, thus requiring more federal funding? What’s wrong with this picture?

“Investing” in start-ups is akin to a parent “lending” money to her 24 year old. Good luck ever seeing that money again! At least she’ll get a Mother’s Day card. The non-investment crowdfunding successes to date have usually involved donors getting a sample product, a discount, or a souvenir tee shirt, baseball cap or the like in exchange for their donation. Perhaps Congress should take a hint from these crowdfunding success stories in fashioning its investment crowdfunding legislation, and mandate that investment crowdfunders distribute a commemorative sweatshirt along with their securities. That would at least give the investors something tangible to remember their investment by, and would create jobs by increasing demand for commemorative sweatshirts! Oh, wait, those are made in Malaysia.

ARTICLE BY

Philip A Feigin

Lewis Roca Rothgerber LLP

New Data Security Bill Seeks Uniformity in Protection of Consumers’ Personal Information

Last week, House lawmakers floated a bipartisan bill titled the Data Security and Breach Notification Act (the Bill). The Bill comes on the heels of legislation proposed by US President Barack Obama, which we recently discussed in a previous post. The Bill would require certain entities that collect and maintain consumers’ personal information to maintain reasonable data security measures in light of the applicable context, to promptly investigate a security breach, and to notify affected individuals of the breach in detail. In our Contract Corner series, we have examined contract provisions related to cybersecurity, including addressing a security incident if one occurs.

Some notable aspects of the Bill include the following:

Notification to individuals affected by a breach would generally be required within 30 days after a company has begun taking investigatory and corrective measures (rather than based on the date of the breach’s discovery).
Notification to the Federal Trade Commission (FTC) and the Secret Service or the Federal Bureau of Investigation would be required if the number of individuals whose personal information was (or there is a reasonable basis to conclude was) leaked exceeds 10,000.
To advance uniform and consistently applied standards throughout the United Sates, the Bill would preempt state data security and notification laws. However, the scope of preemption continues to be discussed, and certain entities would be excluded from the Bill’s requirements, including entities subject to existing data security regulatory regimes (e.g., entities covered by the Health Insurance Portability and Accountability Act).
Violations of the Bill would be enforced by the FTC or state attorneys general (and not by a private right of action).

ARTICLE BY

Michael L. Pillion

A. Benjamin Klaber

Morgan, Lewis & Bockius LLP

USCIS Resumes H-2B Adjudications

The Department of Homeland Security (DHS) has announced that it will resume adjudications of H-2Bpetitions, even though it will continue to suspend premium processing until further notice.

The March 17, 2015, announcement follows the filing of an unopposed motion on March 16 by DOL to stay until April 15the U.S. District Court ruling in Perez v. Perez. That order vacated DOL’s H-2B regulations on the grounds that DOL had no authority under the Immigration and Nationality Act to issue them. DHS suspended H-2B adjudications while it reviewed the decision. As stated in the motion, DHS will resume adjudicating H-2B petitions based on temporary labor certifications issued by DOL.

The DHS announcement follows pressure mounted by stakeholders to resume processing of H-2B petitions already filed, and to accept and process H-2B petitions supported by temporary labor certifications issued prior to March 4, 2015. The court in Perez enjoined DOL from enforcing DOL’s 2008 H-2B regulations. It did not invalidate H-2B temporary labor certifications already issued by the DOL, nor did it direct USCIS to end processing of H-2B petitions supported by previously issued temporary labor certifications. The stakeholders have argued that Perez does not require USCIS to cease processing of their H-2B petitions. They have lamented that the suspension of processing could potentially have a significant impact on a wide range of industries, including resort and hospitality, seafood, landscaping, grounds maintenance, and forestry, to name but a few. Businesses that use the H-2B program to supplement workforce needs will face serious labor shortages, and the potential for significant economic loss across several industries is tremendous.

To fill the regulatory gap occasioned by the court order, DOL and DHS announced on March 13, that they intend to issue a joint interim final rule by April 30, 2015.

ARTICLE BY

Otieno B. Ombok

Jackson Lewis P.C.

March (Appellate) Madness re: O’Bannon NCAA Antitrust Case

It has been a few months since we updated on the O’Bannon antitrustcase, where federal judge Claudia Wilken ruled last summer that theNCAA’s amateurism rules violated federal antitrust laws. But this week, as the rest of the country filled out their brackets and geared up for the start of the NCAA tournament, the NCAA was getting ready for another battle – in the Ninth Circuit. On Tuesday, the appeals court heard oral argument from both the NCAA and plaintiffs’ counsel, as the parties debated the lower court’s decision, which allowed limited compensation for the use of athletes’ name, image, and likenesses.

Central to the parties’ argument was the interpretation of NCAA v. Board of Regents of the University of Oklahoma, a 1984 case regarding football television rights. While the NCAA lost that case, one statement in that case has become central to the NCAA’s current “amateurism” defense: “To preserve the character and quality of the ‘product,’ athletes must not be paid.” In Tuesday’s arguments, some of the judges seemed skeptical of the NCAA’s shifting definition of “pay,” they were also concerned about opening the door to “pay for play.”

We can expect a ruling in the upcoming months, though this is unlikely to be the final appeal in the case.

ARTICLE BY

Amanda Norris Ames

Womble Carlyle Sandridge & Rice, PLLC

March (Appellate) Madness re: O'Bannon NCAA Antitrust Case

We can expect a ruling in the upcoming months, though this is unlikely to be the final appeal in the case.

ARTICLE BY

Amanda Norris Ames

Womble Carlyle Sandridge & Rice, PLLC

NLRB Issues Critical Guidance On Employer Handbooks, Rules and Policies, Including “Approved” Language

On March 18, 2015, NLRB General Counsel Richard F. Griffin, Jr. issuedGeneral Counsel Memorandum GC 15-04 containing extensive guidance as to the General Counsel’s views as to what types employer polices and rules, in handbooks and otherwise, will be considered by the NLRB investigators and regional offices to be lawful and which are likely to be found to unlawfully interfere with employees’ rights under the National Labor Relations Act (“NLRA” or the Act”).

This GC Memo is highly relevant to all employers in all industries that are under the jurisdiction of the National Labor Relations Board, regardless of whether they have union represented employees.

Because the Office of the General Counsel investigates unfair labor practice charges and the NLRB’s Regional Directors act on behalf of the General Counsel when they determine whether a charge has legal merit, the memo is meaningful to all employers and offers important guidance as to what language and policies are likely to be found to interfere with employees’ rights under the Act, and what type of language the NLRB will find does not interfere and may be lawfully maintained, so long as it is consistently and non-discriminatorily applied and enforced.

As explained in the Memorandum, the Board’s legal standard for deciding whether an employer policy unlawfully interferes with employees’ rights under the Act is generally whether “employees would reasonably construe the rules to prohibit Section 7 activity” – that is action of a concerted nature intended to address issues with respect to employees’ terms and conditions of employment. As we have noted previously, this General Counsel and Board have consistently given these terms broad interpretations and have found many employer policies and procedures, in handbooks and elsewhere, that appear neutral and appropriate on their face, to violate the Act and interfere with employee rights. Many of these cases have involved non-union workplaces where there is not a union present and there is no union activity in progress.

There are two sections to the Memo. Part 1 of the Memorandum, which begins at page 2 and runs to page 20, offers a recap of NLRB decisions concerning 8 broad categories of policies, with summaries of the Board’s holdings and examples of policy language that the NLRB has found to unlawfully interfere with employees’ Section 7 rights and policy language that the Board has found did not unlawfully interfere with employees’ rights. Section 2 reports on the General Counsel’s settlement with Wendy’s International LLC following an investigation of charges in which the General Counsel found portions of Wendy’s employee handbook unlawfully overbroad, with an explanation as to why the General Counsel found the policies in question to interfere with employees’ rights under the Act and a description of the language Wendy’s adopted to replace the problematic policies as part of its settlement of the charges. Both parts of the Memorandum will be of interest to employers and attorneys who draft, apply and enforce handbooks and other workplace policy documents.

Part 1: Examples of Handbook Rules found by the Board to be Lawful and Unlawful in recent decisions

Employer Handbooks Rules Regarding Confidentiality – The Memorandum reviews the Board’s precedents holding that “Employees have a Section 7 right to discuss wages, hours, and other terms and conditions of employment with fellow employees, as well as nonemployees such as union representatives.” Interestingly, the Memorandum also states that “broad prohibitions on disclosing ‘confidential’ information are lawful so long as they do not reference information regarding employees or anything that would reasonably be considered a term or condition of employment, because employers have a substantial and legitimate interest in maintaining the privacy of certain business information.” The Memorandum further “clarifies” by advising that “an otherwise unlawful confidentiality rule will be found lawful if, when viewed in context, employees would not reasonably understand the rule to prohibit Section 7 protected activity.”
Employer Handbooks Rules Regarding Employee Conduct toward the Company and Supervisors – As explained in the Memorandum, “Employees also have the Section 7 right to criticize or protest their employer’s labor policies or treatment of employees.” The Memorandum offers an overview of decisional law, with particular attention to cases involving rules that “prohibit employees “from engaging in ‘disrespectful,’ ’negative,’ ‘inappropriate,’ or ‘rude’ conduct towards the employer or management, absent sufficient clarification or context.” As further noted, employee criticism of the employer “will not lose the Act’s protection simply because the criticism is false or defamatory.”
Employer Handbooks Rules Regulating Conduct Towards Fellow Employees – This section of the Memorandum focusses on language and policies that the Board has found to interfere with the Section 7 right employees have ‘to argue and debate with each other about unions, management, and their terms and conditions of employment,” which the General Counsel explains the Board has held will not lose their protection under the Act, “even if it includes ‘intemperate, abusive and inaccurate statements.” Of particular interest in this portion of the Memorandum is the examination of policies concerning harassment. The Memorandum notes that “although employers have a legitimate and substantial interest in maintaining a harassment-free workplace, anti-harassment rules cannot be so broad that employees would reasonably read them as prohibiting vigorous debate or intemperate comments regarding Section 7 protected subjects.”
Employer Handbooks Rules Regarding Employee Interaction With Third Parties – This section of the Memorandum focuses on employer policies and provisions that seek to regulate and restrict employee contact with and communications to the media relating to their employment. The General Counsel notes that “(A)nother right employees have under Section 7 is the right to communicate with the new media, government agencies, and other third parties about wages, benefits, and other terms and conditions of employment,” and that rules “that reasonably would be read to restrict such communications are unlawful.” The General Counsel acknowledges however that “employers may lawfully control who makes official statements for the company,” any such rules must be drafted so as “to ensure that their rules would not reasonably be read to ban employees from speaking to the media or third parties on their own (or other employees”) behalf.
Employer Handbooks Rules Restricting Use of Company Logos, Copyrights and Trademarks – The Board has found many employer policies, whether contained in employee handbooks or elsewhere, that broadly prohibit employees from using logos, copyrights and trademarks to unlawfully interfere with employees’ Section 7 rights. While the General Counsel acknowledges that “copyright holders have a clear interest in protecting their intellectual property,” the Board has found, with the approval of such courts as the Fourth Circuit Court of Appeals, that “handbook rules cannot prohibit employees’ fair protected use of that property.” In this regard the General Counsel states in the Memorandum that it is his office’s position that “employees have a right to use the name and logo on picket signs’ leaflets, and other protected materials,” and that “Employers’ proprietary interests are not implicated by employees’ non-commercial use of a name, logo, or other trademark to identify the employer in the course of Section 7 activity.”
Employer Handbooks Rules Restricting Photography and Recording – While many handbooks and policies prohibit or seek to restrict employees from taking photographs or making recordings in the workplace and on employer policy, the Memorandum states that “Employees have Section 7 right to photograph and make recordings in furtherance of their protected concerted activity, including the right to use personal devices to take such pictures make recordings.” The Memorandum further notes that such policies will be found to be overbroad “where they would reasonably be read to prohibit the taking of pictures or recordings on non-work time.”
Employer Handbooks Rules Restricting Employees from Leaving Work – With respect to handbook or other policies that restrict employees from leaving the workplace or from failing to report when scheduled, the Memorandum notes that “one of the most fundamental rights employees have under Section 7 of the Act is the right to go on strike,” and therefore “rules that regulate when an employee can leave work are unlawful if employees reasonably would read them to forbid protected strike actions and walkouts.” Not all rules concerning absences and leaving the workstations are unlawful. A rule would be lawful if “such a rule makes no mention of ‘strikes,’ ‘walkouts,’ ‘disruptions’ or the like” since employees should “reasonably understand the rule to pertain to employees leaving their posts for reasons unrelated to protected concerted activity.”
Employer Conflict of Interest Rules – The Memorandum states that under Section 7 of the Act, employees have the right to engage in concerted activity to improve their terms and conditions of employment, even if that activity is in conflict with the employer’s interests. It cites as examples of such activities that could arguably be in violation of broad conflict of interest policies as protests outside the employer’s business, organizing a boycott of the employer’s products and services and solicitation of support for a union while on non-work time. The Memorandum notes that when a conflict of interest policy “includes examples of otherwise clarifies that it limited to legitimate business interests (note: as that term is defined by the General Counsel and the Board) employees will reasonably understand the rule to prohibit only unprotected activity.”
Part 2: The Wendy’s International LLC Handbook Cases

The second part of the Memorandum relates to the Board’s settlement of a series of unfair labor practice charges against Wendy’s International LLC (Wendy’s) alleging that various provisions of the handbook were overbroad and unlawfully interfered with employees’ rights under the NLRA. The company entered into an “informal, bilateral Board settlement agreement. In this section, the GC explains why various provisions were found unlawful and then sets forth negotiated replacement policies that the GC found did not violate the Act. While not a formal “safe harbor” since this is the position of the General Counsel and not the Board, it offers very good advice for employers and attorneys in this area. The Wendy’s policies that the General Counsel argued violated employees’ Section 7 rights and the replacements that the General Counsel found acceptable concerned the following areas:
- Handbook Disclosure Provision – The handbook in issue contained a broad prohibition against disclosure of the handbook and the information it contained without the company’s express prior written permission. The General Counsel found this to be unlawful because it prohibited disclosure of employment practices to third parties such as a union or the NLRB.
- Social Media Policy – While the General Counsel acknowledged that employers have “a legitimate interest in ensuring that employee communications are not construed as representing the employer’s official position,” the General Counsel found the company’s rule to be overbroad since it prohibited a much broader range of communications that would be protected by Section 7. This included photography and recording and no retaliation provisions.
- Conflict of Interest Policy
- Company Confidential Information Provision
- Employee Conduct
- Walking Off the Job Without Authorization
- No Distribution/No Solicitation Provision
- Restaurant Telephone; Cell Phone; Camera Phone/Recording Devices Provision
While Memorandum GC 15-04 arguably does not contain “new” information or changes in policy or case law, it should be useful for employers and practitioners (and employees) in that it provides a concise summary of the General Counsel’s views on this wide range of matters and examples of language that is likely to be found lawful in future proceedings. OF course it is important to note that each charge is decided on its own facts and the actions and statements of employers and their supervisors in connection with the application and enforcement of the particular provision will almost always be relevant to the determination of whether the Board will issue a complaint on a particular ULP Charge.

ARTICLE BY

Steven M. Swirsky

Adam C. Abrahms

Epstein Becker & Green, P.C.

Understanding Post-AIA Power of Attorney Procedures –America Invents Act

Applicants identified upon a U.S. patent application’s filing can impact the ownership rights to the patent application throughout prosecution. Prior to implementation of relevant aspects of the America Invents Act (AIA) on September 16, 2012, patent application Applicants could only be Inventors. Conversely, applications filed on or after September 16, 2012 can have Inventors or Assignees as Applicants. The choice of Applicant – Inventors or Assignees – upon filing in post-AIA applications affects how Power of Attorney can be properly established before the U.S. Patent and Trademark Office (USPTO).

Pre-AIA patent applications filed before September 16, 2012 can have Power of Attorney granted by Inventors or Assignees under Rule 32, provided that the requirements of Rule 3.73 are satisfied. In contrast, post-AIA applications filed on or after September 16, 2012 can be filed with Inventors or Assignees as the Applicant, with Rule 32 requiring a Power of Attorney to be signed by either the “Applicant” or “Patent Owner.” However, an Assignee only becomes the patent owner after the application issues as a patent. Thus, in order to take over prosecution in a post-AIA application, the Assignee must either initially be listed as or later formally established to be the Applicant for Power of Attorney to be granted on behalf of the Assignee.

In circumstances where a post-AIA application’s Applicant is identified upon filing as the Assignee, the Assignee may execute a Power of Attorney, and it can be filed without the need to file any separate papers to satisfy Rule 3.71 or Rule 3.73.

When a post-AIA patent application is filed without listing the Assignee as the Applicant (i.e., because the Inventors are listed as the Applicant) or when the Assignee changes during the course of prosecution, Rule 3.71 or Rule 3.73 must be satisfied for the Assignee to establish a Power of Attorney before the USPTO. Namely, a statement under Rule 3.73(c) and a Power of Attorney must be filed. However, the Assignee must first be identified as an Applicant. Currently there are two ways for an Assignee to become an Applicant when not so listed upon initial application filing. First, an Applicant can be added to the existing list of Applicants. Alternately, all Inventors can be removed as the Applicant and be replaced with the Assignee as the Applicant.

A change in an Applicant can be accomplished by filing a supplemental Application Data Sheet (ADS), fulfilling the Rule 3.73(c) requirements including a showing of ownership. A chain of title can be demonstrated through executed assignment(s) and a statement specifying where documents verifying the chain of title from the original owner to the assignee are recorded in the assignment records of the USPTO by reel and frame number. After adding the Applicant, Rule 3.71 or Rule 3.73 can be satisfied by filing a statement under Rule 3.73(c) and filing a properly executed Power of Attorney, thereby appointing the designated patent practitioner.

Accordingly, administrative burdens on the USPTO, on Assignees, and on Assignee representatives can generally be reduced by filing post-AIA applications listing the Assignee as the Applicant, should the Assignee be known at the time of filing.

Colleen Witherell also contributed content for this article.

ARTICLE BY

Christina Sperry

Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

Traditional Law Firm Professional Development Models Obsolete?

Most firm’s lawyer staffing model is not far removed from what might be called “traditional” or “old fashioned.” That means that they still hire most new lawyers immediately upon their graduation from law school, or judicial clerkships – and assume that when they join, they are not ready to practice law. We lawyers assume our new lawyers will learn by working with experienced lawyers (what the consultants call the “apprenticeship” model).

Depending on many variables, we assume that it takes four to seven years before most new lawyers become “stand-alone” professionals. We assume that in time our associates will become our partners and spend their careers as members of our firm. This model helps us to deliver a standard of client service that, we hope, sets us apart.

Are we obsolete? In a changing world, we hold to the conviction that our way remains the best: the best professional development model for lawyers who will become counsellors and advocates for clients facing the most difficult problems.

The greatest challenge to our model has come from high turnover among associates, which we attribute to demographics. Turnover among young lawyers at law firms generally is high, as apparently turnover is high for Millenials generally.

We believe that turnover at Brooks Pierce is lower than among our peers, but – at our size and in our practice niches – turnover (or, retention) is still a challenge, and it is expensive. We cannot ignore it.

Whaddaya gonna do?

We manage. Specifics (our not-so secrets) will come in posts to follow this one.

We believe that we have have continued to make the economics of the old model succeed, even in a time of high associate salaries – and on terms that are fair to our clients, yet work for us. That part is a story for another day.

ARTICLE BY

Edward C. Winslow III

Brooks, Pierce, McLendon, Humphrey & Leonard, LLP

Exclusive Study Analyzes 2014 IPOs – Initial Public Offerings

Proskauer’s Global Capital Markets Group has just released its second annual IPO Study, the group’s analysis of U.S.-listed initial public offerings in 2014 and identification of year-over-year comparisons and trends. As with last year’s first edition, it yields a number of noteworthy observations and insights.

The study examines data from 119 U.S.-listed 2014 IPOs with a minimum deal size of $50 million, and also includes separate industry sections on health care; technology, media and telecommunications; energy & power; financial services; industrials; and consumer/retail. This edition expands on last year’s to include an appendix focusing on foreign private issuers, as 2014 experienced a meaningful return of IPO issuers from Europe and Asia. It also makes year-over-year comparisons of extensive data about deal structures and terms, SEC comments and timing, financial profiles, accounting disclosures, corporate governance and deal expenses.

Underlying the study is the proprietary IPO database that we created for the first edition and have subsequently expanded and enhanced, a valuable resource for sponsors and companies considering an IPO as well as for IPO market participants and their advisors.

Download Proskauer’s 2015 IPO Study

ARTICLE BY

Frank Lopez

Proskauer Rose LLP

The National Law Forum

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Part 2: The Wendy’s International LLC Handbook Cases

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