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USCIS to Implement Premium Processing for Certain Previously Filed Form I-140 Petitions

On May 24, 2022, U.S. Citizenship and Immigration Services (USCIS) announced that it would begin implementing premium processing for certain petitioners who have a pending Form I-140 under the EB-1 and EB-2 classifications.

As explained in our previous alert, USCIS had announced that it will expand its premium processing service to include additional immigration benefit case types, pursuant to a final rule issued by the Department of Homeland Security (DHS). The rule is intended to implement the Emergency Stopgap USCIS Stabilization Act passed by Congress and is part of USCIS’s efforts to reduce existing backlogs and provide needed relief to Employment Authorization Document (EAD) cardholders.

While the rule will become effective on May 31, 2022, it will be implemented in a phased approach over a three-year period. USCIS has now begun implementing these changes to premium processing, starting with certain Form I-140 classifications: EB-1C (classification as a multinational executive or manager) and EB-2 (classification as a member of professions with advanced degrees or exceptional ability seeking a national interest waiver (NIW)).

This expansion will occur in the following phases:

Beginning June 1, 2022, USCIS will accept premium processing requests for EB-1C multinational executive and manager petitions received on or before January 1, 2021.
Beginning July 1, 2022, USCIS will accept premium processing requests for EB-2 NIW petitions received on or before June 1, 2021, and EB-1C multinational executive and manager petitions received on or before March 1, 2021.

USCIS will only accept premium processing requests for currently pending cases based on their date of filing, as noted above. USCIS is not accepting new Form I-140 petitions in these categories with a premium processing request at this time. We anticipate that USCIS will expand premium processing requests for more recently filed EB-1 and EB-2 petitions in the future.

Article By Shannon N. Parker of Mintz

For more immigration legal news, click here to visit the National Law Review.

Small Businesses Don’t Recognize Risk of Cyberattack Despite Repeated Warnings

CNBC surveys over 2,000 small businesses each quarter to get their thoughts on the overall business environment and their small business’ health. According to the latest CNBC/SurveyMonkey Small Business Survey, despite repeated warnings by the Cybersecurity and Infrastructure Security Agency and the FBI that U.S.- based businesses are at an increased risk of a cyber-attack following Russia’s invasion of Ukraine, small business owners do not believe that it is an actual risk that will affect them, and they are not prepared for an attack. The latest survey shows that only five percent of small business owners reported cybersecurity to be the biggest risk to their company.

What is unfortunate, but not surprising, is the fact that this is the same percentage of small business owners who recognized a cyber attack as the biggest risk a year ago. There has been no change in the perception among business owners, even though there are repeated, dire warnings from the government. Also unfortunate is the statistic that only 33 percent of business owners with one to four employees are concerned about a cyber attack this year. In contrast, 61 percent of business owners with more than 50 employees have the same concern.

According to CNBC, “this general lack of concern among small business owners diverges from the sentiment among the general public….In SurveyMonkey’s polling, 55% of people in the U.S. say they would be less likely to continue to do business with brands who are victims of a cyber attack.” CNBC’s conclusion is that there is a disconnect between business owners’ appreciation of how much customers care about data security and that “[s]mall businesses that fail to take the cyber threat seriously risk losing customers, or much more, if a real threat emerges.” Statistics show that threat actors are targeting small to medium-sized businesses to stay under the law enforcement radar. With such a large target on their backs, business owners may wish to make cybersecurity a priority. It’s important to keep customers.

Article By Linn F. Freedman of Robinson & Cole LLP

For more cybersecurity legal news, click here to visit the National Law Review.

If You Can’t Stand the Heat, Don’t Build the Kitchen: Construction Company Settles Allegations of Small Business Subcontracting Fraud for $2.8 Million

For knowingly hiring a company that was not a service-disabled, veteran-owned small business to fulfill a set aside contract, a construction contractor settled allegations of small business subcontracting fraud for $2.8 million. A corporate whistleblower, Fox Unlimited Enterprises, brought this misconduct to light. We previously reported on the record-setting small business fraud settlement with TriMark USA LLC, to which this settlement is related. For reporting government contracts fraud, the whistleblower will receive $630,925 of the settlement.

According to the allegations, the general contractor and construction company Hensel Phelps was awarded a General Services Administration (GSA) contract to build the Armed Forces Retirement Home’s New Commons/Health Care Building in Washington, D.C. Part of the contract entailed sharing the work with small businesses, including service-disabled, veteran-owned small businesses (SDVOSB). The construction contractor negotiated all aspects of the contract with an unidentified subcontractor and then hired an SDVOSB, which, according to the settlement agreement, Hensel Phelps knew was “merely a passthrough” for the larger subcontractor, thus creating the appearance of an SDVOSB performing the work on the contract to meet the set-aside requirements. The supposedly SDVOSB subcontractor was hired to provide food service equipment for the Armed Forces Retirement Home building.

“Set aside” contracts are government contracts intended to provide opportunities to SDVOSB, women-owned small businesses, and other economically disadvantaged companies to do work they might not otherwise access. Large businesses performing work on government contracts are often required to subcontract part of their work to these types of small businesses. “Taking advantage of contracts intended for companies owned and operated by service-disabled veterans demonstrates a shocking disregard for fair competition and integrity in government contracting,” said the United States Attorney for the Eastern District of Washington, as well as a shocking disregard for proper stewardship of taxpayer funds.

Whistleblowers can help fight fraud and protect taxpayers by reporting government contracts fraud. A whistleblower can report government contracts fraud under the False Claims Act and become a relator in a qui tam lawsuit, from which they may be entitled to a share of the funds the government recovers from fraudsters.

Article By Eva Gunasekera and Renée Brooker at Tycko & Zavareei LLP

For more whistleblower legal news, click here to visit the National Law Review.

DOJ Limits Application of Computer Fraud and Abuse Act, Providing Clarity for Ethical Hackers and Employees Paying Bills at Work Alike

On May 19, 2022, the Department of Justice announced it would not charge good-faith hackers who expose weaknesses in computer systems with violating the Computer Fraud and Abuse Act (CFAA or Act), 18 U.S.C. § 1030. Congress enacted the CFAA in 1986 to promote computer privacy and cybersecurity and amended the Act several times, most recently in 2008. However, the evolving cybersecurity landscape has left courts and commentators troubled by potential applications of the CFAA to circumstances unrelated to the CFAA’s original purpose, including prosecution of so-called “white hat” hackers. The new charging policy, which became effective immediately, seeks to advance the CFAA’s original purpose by clarifying when and how federal prosecutors are authorized to bring charges under the Act.

DOJ to Decline Prosecution of Good-Faith Security Research

The new policy exempts activity of white-hat hackers and states that “the government should decline prosecution if available evidence shows the defendant’s conduct consisted of, and the defendant intended, good-faith security research.” The policy defines “good-faith security research” as “accessing a computer solely for purposes of good-faith testing, investigation, and/or correction of a security flaw or vulnerability, where such activity is carried out in a manner designed to avoid any harm to individuals or the public, and where the information derived from the activity is used primarily to promote the security or safety of the class of devices, machines, or online services to which the accessed computer belongs, or those who use such devices, machines, or online services.”

In practice, this policy appears to provide, for example, protection from federal charges for the type of ethical hacking a St. Louis Post-Dispatch reporter performed in 2021. The reporter uncovered security flaws in a Missouri state website that exposed the Social Security numbers of over 100,000 teachers and other school employees. The Missouri governor’s office initiated an investigation into the reporter’s conduct for unauthorized computer access. While the DOJ’s policy would not affect prosecutions under state law, it would preclude federal prosecution for the conduct if determined to be good-faith security research.

The new policy also promises protection from prosecution for certain arguably common but contractually prohibited online conduct, including “[e]mbellishing an online dating profile contrary to the terms of service of the dating website; creating fictional accounts on hiring, housing, or rental websites; using a pseudonym on a social networking site that prohibits them; checking sports scores at work; paying bills at work; or violating an access restriction contained in a term of service.” Such activities resemble the facts of Van Buren v. United States, No. 19-783, which the Supreme Court decided in June 2021. In Van Buren, the 6-3 majority rejected the government’s broad interpretation of the CFAA’s prohibition on “unauthorized access” and held that a police officer who looked up license plate information on a law-enforcement database for personal use—in violation of his employer’s policy but without circumventing any access controls—did not violate the CFAA. The DOJ did not cite Van Buren as the basis for the new policy. Nor did the DOJ identify any another impetus for the change.

To Achieve More Consistent Application of Policy, All Federal Prosecutors Must Consult with Main Justice Before Bringing CFAA Charges

In addition to exempting good-faith security research from prosecution, the new policy specifies the steps for charging violations of the CFAA. To help distinguish between actual good-faith security research and pretextual claims of such research that mask a hacker’s malintent, federal prosecutors must consult with the Computer Crime and Intellectual Property Section (CCIPS) before bringing any charges. If CCIPS recommends declining charges, prosecutors must inform the Office of the Deputy Attorney General (DAG) and may need to obtain approval from the DAG before initiating charges.

Article By Kyle R. Freeny, Linda Ricci, Jena M. Valdetero, and Brittany M. Fisher of Greenberg Traurig, LLP

For more data privacy and cybersecurity legal news, click here to visit the National Law Review.

Adding Impact to Your Next Cross Examination: 5 Things to Consider When Presenting Witness Testimony

As every trial attorney knows, there are many strategies for cross examining a witness. Among the most effective is confronting a witness with their previous deposition testimony. Nothing beats an opportunity to use their own words against them.

In order to get the most impact from this practice, a savvy litigator will read transcript passages or play audio/video excerpts from the witness’s deposition. An alternate technique—most effective when there is a lot of testimony—is showing a witness’s testimony on-screen using slides. Of course, as with any PowerPoint presentation, there are several things to consider when using this tool to cross examine a witness.

Tips for Witness Testimony Presentation

1. FORMAT THE TRANSCRIPT TEXT

Rather than importing an image of the transcript page, consider copy/pasting or retyping the testimony into a slide. This will give you control over how large you make the text and can even allow you to emphasize certain words or statements that align with your case themes. In addition, most jurors sit 20-40 feet from the projection screen in the courtroom. A good rule of thumb is to use 20-point font type or larger.

2. USE BOLD FONT TYPE

By bolding questions within the transcript, jurors will more easily distinguish them from the witness’s answers to each question. Another tip is to stay away from unique fonts. While “French Script” might be a nice touch on a party invitation, it can be hard to read from the jury box.

3. ANIMATE EACH QUESTION AND ANSWER

If you are using PowerPoint or Key Note, consider adding animation to each question-and-answer text block. It’s natural for people to read ahead if there is more on the screen; by revealing each question and answer one-by-one, you will have a much better chance of holding the jurors’ attention. Effects like “appear,” “wipe,” or “fade” are all good options for this, but stay away from more flamboyant effects like “fly-in” or “zoom” since those are too distracting (and most judges will not allow that to go on for more than a few slides).

4. USE A PHOTO OF THE WITNESS

A photo of the witness will allow the jury to connect the testimony with the witness. If you didn’t videotape the witness, look for a picture on their company website or social media profiles. Obvious caveats apply here; you generally know what the court will allow and to what opposing counsel will object.

5. BE FLEXIBLE

Even though you have prepared all your testimony slides for the unexpected, consider having the entire transcript loaded in a trial presentation software (e.g., TrialDirector or Sanction) that allows you or your trial presentation consultant to jump to any portion of the transcript on the fly. It’s very possible that opposing counsel will argue that an answer is not complete, and the court might instruct you to continue on for several more lines of testimony.

In Conclusion

Visually displaying a witness’s deposition testimony during cross examination allows you to drive home the points most relevant to your arguments and case themes, and most salient to jurors you hope to influence. Following these five simple rules above will make that tactic even more effective in court.

Article By Adam Bloomberg of IMS Consulting & Expert Services

For more business of law legal news, click here to visit the National Law Review.

Biden Revisions to the NEPA Regulations Now in Effect

The Biden Administration is amending the federal regulations for implementing the National Environmental Policy Act (NEPA) to reverse certain changes made by the Trump Administration. The first set of amendments took effect last Friday on May 20, 2022.

As background, the Council for Environmental Quality (CEQ) first issued the NEPA implementing regulations in 1978. They remained unchanged for more than 40 years until the Trump Administration published its 2020 rule updating the regulations to facilitate “more efficient, effective, timely NEPA reviews.” Developers, construction companies, and other businesses generally supported these changes with the hope they would streamline a lengthy process that often significantly delays projects. However, environmentalists opposed the changes, fearing they would weaken important protections, including those aimed at reducing climate change impacts and protecting natural resources. Upon taking office, the Biden Administration immediately began an effort to reverse parts of the 2020 rule.

The Biden amendments will be issued in two phases. The “Phase One” rule was published on April 20, 2022, and is in effect as of May 20, 2022. The “Phase Two” rule, which is expected to include more comprehensive revisions, will be issued “over the coming months”.

The Phase One rule reinstates the following three key provisions of the NEPA regulations:

1. Statement of Purpose and Need, and Scope of Reasonable Alternatives (40 CFR 1502.13)

Under NEPA, an agency’s statement of purpose and need informs the range of alternative actions analyzed in an environmental assessment (EA) or environmental impact statement (EIS). The NEPA regulations historically required agencies to consider “reasonable alternatives not within the jurisdiction of the lead agency.” The 2020 rule updates, however, instructed agencies to limit the statement of purpose and need, and therefore the range of alternatives, to only those that are consistent with the applicant’s goals and the agency’s statutory authority.

The Phase One rule removes these limitations to re-establish federal agencies’ discretion to consider a variety of factors, including a range of reasonable alternatives that are not entirely consistent with the goals of the project applicant. Accordingly, federal agencies may again coordinate with communities and project proponents to evaluate alternatives that could minimize environmental and public health costs, but extend beyond the scope of the agency’s authority or do not serve the applicant’s goals.

2. Agency Implementing Regulations (40 CFR 1507.3)

The Phase One rule also removes language that could limit agencies’ standards and procedures for implementing NEPA rules that extend beyond CEQ regulatory requirements. This update reestablishes CEQ regulations as the “floor” for NEPA environmental review, and restores the agency’s discretion and flexibility to tailor NEPA procedures to align with specific agency and public needs. In contrast, the 2020 rule would have made the CEQ regulations a “ceiling” for NEPA requirements, effectively restricting agencies’ discretion to develop and implement procedures beyond requisite CEQ regulations.

3. Scope of Effects (40 CFR 1508.1(g))

Finally, the Phase One rule restores the definition of “effects” that requires agencies to consider the historic categories of “reasonably foreseeable” direct, indirect, and cumulative effects. The 2020 rule, in contrast, limited the scope of this analysis to effects with a “reasonably close causal relationship,” and included language indicating that agencies were only required to consider direct effects, had discretion to consider indirect effects, and should not consider cumulative effects in NEPA review. The Phase One rule change thus ensures that agencies’ NEPA documents will evaluate all relevant environmental impacts resulting from the agency decision.

Here, the Phase One rule reversal is particularly impactful in terms of an agency’s consideration of climate change, where cumulative effects tend to be substantially greater than the effects of the individual project. The Phase One update confirms CEQ’s view that climate change impacts are adequately considered in evaluating direct, indirect and cumulative effects.

*****

Except for reinstating these three key provisions, the Phase One rule does not affect other changes made by the 2020 rule. The Biden Administration plans to introduce more comprehensive changes as part of the forthcoming Phase Two rule. These changes, which are anticipated to be more controversial and draw additional public attention, are expected to address environmental justice, public participation, and streamlining provisions, including the use of plain language, deadlines, page limits, and inter-agency coordination.

Article By Alexander L. Merritt and Kathryn C. Kafka of Sheppard, Mullin, Richter & Hampton LLP

For more environmental legal news, click here to visit the National Law Review.

Beware OFAC in a Time of Sanctions

On Monday, April 25, 2022, the U.S. Treasury Department’s Office of Foreign Asset Control (“OFAC”) announced a settlement with Toll Holdings Limited (“Toll”), an Australian freight forwarding and logistics company, with respect to Toll’s originations and/or receipt “of payments through the U.S. financial system involving sanctioned jurisdictions and persons.” Toll, which is not an American entity, and is neither owned by Americans nor located in the U.S. or any of its territories, was involved in almost 3000 transactions where payments were made in connection with sea, air, and rail shipments to, from, or through North Korea, Iran, or Syria, AND/OR involving the property of a person on OFAC’s Specially Designated Nationals and Blocked Persons List. OFAC did not have direct jurisdiction over Toll, BUT because the payments for Toll’s freight forwarding and logistics services flowed through U.S. financial institutions, Toll “caused the U.S. financial institutions to be engaged in prohibited activities with … sanctioned persons or jurisdictions.”

Each OFAC violation can be the basis of civil sanctions. Here the 2853 violation would have supported the imposition of civil sanctions totaling over $826 million. Toll was “happy” to settle OFAC’s enforcement action for $6 million. OFAC found that the Toll violations were “non-egregious,” in part due to the rapid growth of Toll after 2007 through acquisitions of smaller freight forwarding companies. OFAC noted that by 2017 Toll had almost 600 invoicing, data, payment, and other systems spread across its various units. OFAC also noted that Toll did not have adequate compliance procedures and procedures in place and did not attend to those issues until an unnamed bank threatened to cease doing business with Toll because Toll was using its U.S. dollar account to transact business with sanctioned jurisdictions and/or persons. OFAC took note of Toll’s voluntary self-disclosure, well-organized internal investigation, and extensive remedial measures.

OFAC traces its origins to the War of 1812, when the then Secretary of the Treasury imposed sanctions on the United Kingdom in retaliation for the impressment of American sailors. The Treasury Department has had a special office dealing with foreign assets since 1940 (and the outbreak of World War II), with statutory authority found in the Trading With The Enemy Act of 1917 (as World War I raged), and a series of federal laws involving embargoes and economic sanctions. OFAC received its current name as part of a Treasury Department order on October 15, 1962 (contemporaneous with the Cuban missile crisis).

The Toll settlement reflects the growing use by OFAC of public enforcement against foreign businesses for “causing” violations by involving U.S. payment systems. The use of U.S. dollars in any part of a transaction will typically involve the U.S. financial system, directly or indirectly – that subjects the entirety of the transaction to U.S regulatory jurisdiction, including that of OFAC. The Toll settlement evidences OFAC’s increasing willingness to exercise its expansive jurisdiction over foreign businesses, even those involving primarily extraterritorial transactions — for example, the increase in OFAC sanctions of foreign businesses seen as facilitating the Russian invasion of Ukraine.

Foreign businesses must give serious and continuing attention to having substantial policies and procedures in place to insure compliance with U.S. sanctions and, thereby, to avoid OFAC enforcement actions. Companies can start by reviewing OFAC’s Framework for Compliance Commitments and implementing the recommendations there. In addition, all parties to a transaction should be screened against sanction lists (OFAC’s, and also those of the U.K. and E.U.). Companies should consider adopting preventive measures, not only to deter violations, but also to demonstrate a vigorous compliance program. Similarly, these issues MUST be considered as part of any merger or acquisition (as the Toll experience suggests).Finally, all counterparties, including financial intermediaries, should be evaluated for potential sanction list issues. Otherwise, a foreign business may have to “pay the Toll” for its shortcomings.

Experienced American business lawyers may prove helpful in designing and/or evaluating the compliance programs of non-U.S. companies.

Article By Peter D. Hutcheon of Norris McLaughlin P.A.

For more financial legal news, click here to visit the National Law Review.

Preparing to Testify in Response to an SEC Subpoena

When investigating companies, brokerage firms, investment advisors, and other entities and individuals, the U.S. Securities and Exchange Commission (SEC) relies heavily on its subpoena power. Once the SEC launches a formal investigation, it can issue administrative subpoenas to the company executives, brokers, and others. These subpoenas may be a subpoena duces tecum which compels the person to whom it is addressed to produce documents in his possession or control, or a subpoena ad testificandum which compels the person to whom it is addressed to appear at a specific time and place and testify under oath or affirmation. Crucially, while these subpoenas do not require judicial approval, they are subject to judicial enforcement.

With this in mind, receiving an SEC subpoena is not a matter to be taken lightly. Individuals who have been subpoenaed to testify must thoroughly prepare their testimony, and they need to make sure they know what to expect when the day arrives.

Testifying before the SEC is fraught with potential risks. It is imperative that subpoena recipients devote the necessary time to their preparations, and that they work with their counsel to proactively identify and address all potential areas of concern.

Understanding Why You Have Received an SEC Subpoena

When preparing to testify before the SEC, a key first step is to understand why you have been subpoenaed. Broadly speaking, the SEC focuses its enforcement efforts on two areas: (i) protecting U.S. investors, and (ii) preserving the integrity of U.S. capital markets. As a result, most SEC investigations target allegations of fraud, misrepresentation, conspiracy, and other offenses in one (or both) of these areas.

The SEC’s subpoena should provide at least some insight into the focus and scope of the SEC investigation. However, gathering the information you need to make informed decisions may require examination of other sources as well. For example, it will be helpful if you can identify anyone else who has received a subpoena or Wells Notice related to the investigation, and it may be prudent to conduct an internal compliance audit focused on uncovering any issues that could come to light.

Questions You Should Be Prepared to Answer During Your SEC Testimony

When preparing SEC testimony, it is important to keep in mind that you could easily be fielding questions for six hours or longer. While this can seem overwhelming, SEC subpoena recipients can generally expect to be asked questions in seven main categories. These main categories are:

Preliminary Matters
Background and Personal Information
Your Role Within Your Company or Firm
The Scope of Your Duties
Investors
Due Diligence
Clarifying and Closing the Record

1. Questions Regarding Preliminary Matters

SEC subpoena recipients can initially expect a series of questions that are designed to provide the SEC with insight into the steps they took to prepare their testimony. While these questions are largely procedural, some can present traps for the unwary. At the beginning of the session, you should be prepared to succinctly and confidently answer questions such as:

Did you get the opportunity to review the Formal Order associated with this matter?
Do you have any questions regarding the Formal Order?
Did you complete the Background Questionnaire by yourself?
Are the contents within the Background Questionnaire truthful and accurate?
Is there any information you wish to add to the Background Questionnaire?
Do you understand the rules and procedures of the SEC testimony process?
Do you have any questions on the rules and procedures of the SEC testimony process?

2. Questions Regarding Background and Personal Information

After dispatching these preliminary matters, the focus will shift to the SEC subpoena recipient’s background and personal information. Keep in mind that the SEC likely has much (if not all) of this information already—so if you omit information or provide misleading answers, this will not go unnoticed. During this phase of your testimony, you can expect to be asked questions such as:

What is your educational background?
Do you hold any professional or financial licenses?
Have you ever worked for a financial firm or investment advisory firm?
When did you first meet the other individual(s) involved in this matter?
Who introduced you?
What was the purpose of your first meeting (e.g., social meeting or business planning)?
Do your families know each other?
Where are you employed now?

3. Questions Regarding Your Role Within Your Company or Firm

If the SEC is investigating your company or firm (perhaps in addition to investigating you personally), you can expect several questions regarding your role within the organization. Depending on your position, the SEC’s investigators may ask you questions regarding the company or firm itself. Some examples of the questions you should be prepared to answer (as applicable) include:

When did you start working at the company?
What is your position at the company?
Can you describe the company’s corporate structure?
What are your title and position at the company?
Have your title and position changed over time?
What are the duties at the company?
Have your duties changed over time?
How is the company funded?
What is your salary at the company?
Who makes the majority of the decisions for the company?
Does the company sell securities?
Does the company pay dividends?
Does the company have voting rights?

4. Questions Regarding the Scope of Your Duties

After gaining an understanding of your role within your company or firm, the questioning will likely shift toward examining the scope of your duties in greater detail. In most cases, this is where the questions asked will begin to focus more on the substance of the SEC’s investigation. During this phase of your testimony, potential questions may include:

Can you describe your access to investor funds, financial statements and records, and investor details?
Are you aware of or do you have access to the sources of the company´s income?
What are the sources of the company´s revenue and projected revenue?
Can you describe or do you have access to the sources of the company´s expenses?
Who is responsible for preparing the company´s financial statements?
Do you have any role in preparing or compiling the company´s financial statements?
Who is responsible for preparing the company´s projected financial statements, including projected capital contributions, projected expenses, and projected revenues?
Do you have any role in preparing or compiling the company´s projected financial statements?
Does the company have its financial statements audited on an annual basis?
Did you ever act as a point of contact or intermediary between the company and third parties, such as investors or banks?
Do you ever serve as a representative of the company?
Are you involved in any of the company’s promotional efforts to the public?
Do you know or do you have access to details of the company’s anticipated monetization plans?
Are you aware of any complaints against the company?

5. Questions Regarding Investors

Once the scope of your duties has been established, the SEC’s investigators may next focus on your company’s or firm’s communications and relationships with investors. Here too, the investigators’ questions are likely to be tailored to the specific allegations at issue—and you could get yourself into trouble if you aren’t careful. To the extent of your knowledge, you should be prepared to accurately answer questions such as:

Does the company have investors?
Who are the investors?
What types of customers and/or investors do the company target or appeal to?
Do you communicate with investors?
How did the company attract capital contributions for its formation, project funding, and subsequent business plans?
Does the company adopt targeted marketing strategies, or does the company engage in general advertising?
What is the average contribution of the company’s investors?
Did you create, or do you have access to, a cap table?
Did you assist in the preparation of a cap table?
Did the company issue stock certificates or provide any other proof of equity ownership to investors?
Did the company register any of its investments?
Did the company issue a private placement memorandum or file a Form D?
Do you know if any investors already knew the company´s directors and officers before investing?
Does the company solicit investors or advertise to the general public (e.g., retail investors)?
Are you aware of what the company does with investor funds?
Can you describe your role in preparing any promotional or marketing materials?
Has the company distributed any investor documents or marketing/solicitation materials to the public?
Does the company have any plan to show, or did it show, promotional documents to investors?
Does the company hold regular investor calls?

6. Questions Regarding Due Diligence

Due diligence is often a key topic of discussion. SEC investigators are well aware that many company executives, brokers, and others are not sufficiently familiar with their companies’ and firms’ due diligence obligations, and charges arising out of due diligence violations are common. With this in mind, you should be prepared to carefully navigate inquiries such as:

Does the company have any identity verification procedures in place?
What kinds of identity verification procedures does the company use for its investors?
Can you describe the company´s know-your-customer (“KYC”) policies?
Do you assist with verifying investors or capital contributions?
Does the company maintain a compliance program?

7. Questions to Clarify and Close the Record

Finally, at the end of the session, the SEC’s investigators will ask if you want to clarify or supplement any of the answers you have provided. It is important not to let your guard down at this stage. While your testimony is nearly over, you need to remain cognizant of the risk of providing unnecessary information (or omitting information) and exposing yourself to further scrutiny or prosecution. With this in mind, it is best to consult with your counsel before answering questions such as:

Is there anything you wish to clarify from today´s testimony?
Is there anything you wish to add to your testimony before we close and go off the record?

Practicing your answers to these questions (among others) in a mock interview with your legal counsel or SEC defense attorney will help ensure that you are prepared for the SEC as possible.

Article By Dr. Nick Oberheiden of Oberheiden P.C.

For more SEC and securities legal news, click here to visit the National Law Review.

Afghanistan Temporary Protected Status Application Instructions To Be Issued

The Temporary Protected Status (TPS) grant for Afghanistan will go into effect on May 20, 2022, with publication of the notice in the Federal Register with instructions on how to apply for TPS and for Employment Authorization.

In March 2022, Department of Homeland Security (DHS) Secretary Alejandro Mayorkas announced that Afghanistan was added to the list of countries eligible for TPS. This would benefit approximately 75,000 individuals and provide temporary employment authorization. The 18-month initial grant and registration period became effective on March 20, 2022, and runs through November 20, 2023.

To be eligible, individuals must demonstrate their continuous residence in the United States since March 15, 2022, and their continuous physical presence in the United States since March 20, 2022. Any nationals or residents of Afghanistan who are not currently residing in the United States or who arrived after March 15, 2022, will not be eligible for this TPS designation.

Eligible individuals must submit Form I-821, Application for Temporary Protected Status, during the 18-month initial registration period. They may also submit a request for an Employment Authorization Document using Form I-765, Application for Employment Authorization. The applications may be submitted together and may be submitted online.

Afghan nationals who arrived in the United States through the evacuation effort, Operation Allies Welcome, received humanitarian parole and work authorization for a period of two years. Those individuals may also be eligible for TPS.

DHS has also announced that F-1 students from Afghanistan experiencing severe economic hardship due to the situation in Afghanistan will be eligible for work authorization, increased permittable work hours, and a reduction in their course load as an accommodation.

Article By Rashmi K. Shah of Jackson Lewis P.C.

For more immigration legal news, click here to visit the National Law Review.

Trade Mark Infringement – Muslim Dating App Meets its Match [.com]

A recent Intellectual Property Enterprise Court Decision (IPEC) on 20 April 2022 has decided that ‘Muzmatch’, an online matchmaking service to the Muslim Community has infringed Match.com’s registered trade marks.

The decision by Nicholas Caddick Q.C was that Muzmatch’s use of signs and its name amounted to trade mark infringement and/or passing off of Match.com’s trade marks. This case follows successful oppositions by Match.com to Muzmatch’s registration of its marks in 2018, and unsuccessful attempts by Match.com to purchase Muzmatch between 2017 and 2019.

Match.com is one of the largest and most recognisable dating platforms in the UK. It first registered a word mark ‘MATCH.COM’ in 1996 and also owns other dating-related brands including Tinder and Hinge with other marks including the word mark ‘TINDER’. Match.com used a 2012 TNS report to illustrate its goodwill and reputation and 70% of people surveyed would be able to recall Match.com if prompted, 44% unprompted and 31% of people would name Match.com as the first dating brand off the ‘top of their head.’

Muzmatch is a comparatively niche but growing dating platform, which aims to provide a halal (i.e. in compliance with Islamic law) way for single Muslim men and women to meet a partner. Muzmatch is comparatively much smaller and was founded in 2011 by Mr Shahzad Younas and now has had around 666,069 sign-ups in the UK alone.

The Court considered that the marks ‘Muzmatch’ and ‘MATCH.COM’ and each company’s graphical marks, had a high degree of similarity in the services provided. The marks were also similar in nature orally and conceptually and the addition of the prefix ‘Muz’ did not distinguish the two marks, nor could the lack of the suffix ‘.com’ or stylistic fonts/devices.

The key issue of the case relates to the idea of the term ‘Match’ which is used by both marks to describe the nature of the business: match[ing]. Muzmatch argued that as both marks share this descriptive common element, so it is difficult to conclude that there is a likelihood of confusion between the two marks as the term just describes what each business does.

The Court found that finding that there is a likelihood of confusion for a common descriptive element is not impossible, as the descriptive element can be used distinctively. The average consumer would conclude that the portion ‘Match’ is the badge of origin for Match.com due to its reputation as a brand and the very substantial degree of distinctiveness in the dating industry. An average consumer would have seen the word ‘Match’ as the dominant element in the Match.com trade marks and Match.com is often referred to as just ‘Match’ in advertisements.

Aside from its marks, Muzmatch utilised a Search Engine Optimisation strategy from January 2012 whereby it utilised a list of around 5000 keywords which would take a user to a landing page on the its website. In the list of the keywords used, Muzmatch used the words ‘muslim-tinder’, ‘tinder’ and ‘halal-tinder’ which were accepted by Muzmatch during the litigation to have infringed Match’s trade marks of the Tinder brand including the word mark ‘TINDER’. Muzmatch’s SEO use was also found to cause confusion based on some of its keywords including ‘UK Muslim Match’, which again uses the term Match distinctively, therefore a consumer may confuse a link to ‘UK Muslim Match’ with ‘Match.com’.

Therefore, the Court found that there was likely to be confusion between Muzmatch and Match.com because of the distinctive nature of the term ‘Match’ in the world of dating platforms. An average consumer would conclude that Muzmatch was connected in a material way with the Match.com marks, as if it was targeted at Muslim users as a sub-brand, so this confusion would be trade mark infringement under S10(2) of the Trade Marks Act 1994.

The Court also considered that Muzmatch had taken unfair advantage of Match.com’s trade marks and had therefore infringed those marks under S10(3) of the Trade Marks Act 1994. This was due to the reputation of Match.com’s trade marks and because a consumer would believe that Muzmatch was a sub-brand of Match.com.

The Court rejected Muzmatch’s defence of honest concurrent use and found that Match.com would also have an alternative claim in the tort of passing off.

Key Points:

The Court found that a common descriptive element can acquire distinctiveness in an area, solely because of a company’s reputation and influence in that market.

The use of Search Engine Optimisation strategies can also constitute a trade mark infringement.

The lack of the suffix ‘.com’ in a mark is not sufficient to distinguish use from a household brand such as Match.com, so care should be taken with brands such as ‘Match.com’, ‘Booking.com’[1]

Source:

[1] Match Group, LLC, Meetic SAS, Match.Com International Limited v Muzmatch Limited, Shahzad Younas [2022] EWHC 941 (IPEC)

[1] Note- Blog Post of July 6 2020 Relating to Booking.com- https://www.iptechblog.com/2020/07/us-supreme-court-opens-doors-to-generic-com-trademarks/

Article By Connor Sargeant and the Intellectual Property and Technology Practice Group at Squire Patton Boggs (US) LLP .

For more intellectual property legal news, click here to visit the National Law Review.

Tag: business

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