Tag: legal

H-1B Proposal Modernizes H-1B Requirements and Oversight, Provides Limited Flexibility for F-1 Student Visa Program

The White House Office of Management and Budget (OMB) has reviewed and approved a Department of Homeland Security (DHS) proposal to bring oversight of the H-1B visa program to the modern era. This proposal also creates flexibility in the F-1 student visa program for students who are the beneficiaries of timely filed H-1B cap-subject petitions.

Based upon the information published by the Department of Homeland Security, the proposed rule will:

  • Revise the regulations relating to the “employer-employee relationship”
  • Provide flexibility for start-up entrepreneurs
  • Implement new requirements and guidelines for site visits, including those conducted in connection with petitions filed by H-1B dependent employers whose basic business information cannot be validated through commercially available data
  • Provide limited flexibility on the employment start date listed on the petition
  • Address “cap-gap” concerns
  • Bolster the H-1B registration process to reduce the possibility of misuse and fraud in the H-1B registration system
  • Clarify the requirement that an amended or new petition must be filed where there are material changes, including the streamlining notification requirements related to certain worksite changes

Written public comments must be submitted by Dec. 22, 2023, online at regulations.gov. The proposal, particularly the component aimed at reducing fraud and misuse in the H-1B registration system, is expected to be welcomed by H-1B petitioners and employee beneficiaries who have faced extreme challenges in the lottery in recent years.

Following DHS precedent, the proposed rule is expected to have a delayed effective date should it proceed.

With the fiscal year 2025 H-1B registration season fast approaching, employers and potential H-1B registrants should consider this new proposed rule when solidifying plans for the upcoming registration period.

This article was co-authored by Tieranny Cutler.

© 2023 BARNES & THORNBURG LLP
By Sarah J. Hawk of Barnes & Thornburg LLP
For more news on H-1B Oversight Proposal, visit the NLR Immigration section.

Businesses Beware: Penalties for Failure to Comply with Reporting Requirements of the Corporate Transparency Act

Businesses, especially small and privately-owned businesses, should be aware of federal reporting requirements becoming effective Jan. 1, 2024. Congress enacted the Corporate Transparency Act (“CTA”) in 2021 to combat money laundering, terrorism financing, securities fraud, and other illicit financial activities by requiring businesses to be transparent about their ownership. With significant exceptions, the CTA generally requires businesses to report certain information—known as Beneficial Ownership Information (“BOI”)—to the federal government. BOI must be reported to the Financial Crimes Enforcement Network (“FinCEN”)—a Bureau of the U.S. Department of Treasury—where the information will be stored in a secured database. Last year, FinCEN published final regulations implementing the CTA’s reporting requirements. These regulations become effective Jan. 1, 2024.

Businesses should begin preparing for compliance with the CTA, as initial reports for existing businesses must be submitted prior to Jan. 1, 2025, and the penalties for non-compliance are severe.

What is BOI?
The CTA generally requires most domestic and foreign business entities doing business in the United States to report BOI concerning:

persons who directly or indirectly hold a 25% or greater interest in the business;
persons who directly or indirectly “exercise substantial control over” the business; and
for businesses formed after Jan. 1, 2024, persons who assisted in the preparation of the business’s organic documents.
To Whom and When Must BOI be Reported?
For existing businesses, BOI must be reported prior to January 01, 2025.
Businesses formed after Jan. 1, 2024, will have 30 days from confirmation of their formation, incorporation, or registration to report BOI.
If a business’s beneficial ownership changes following the submission of a BOI report, the business must report updated BOI to FinCEN within 30 days after such change.
Penalties for Failure to Comply with the CTA
The penalties for willfully failing to comply with the CTA’s reporting requirements are quite severe. Any person who willfully fails to report BOI or reports it inaccurately may be subject to civil and criminal penalties, including fines up to a maximum of $10,000 and imprisonment up to 2 years. Businesses should be aware that, although they may have been required to supply information regarding the entity to the secretary of state or other similar office upon formation or registration, BOI reports concern the business’ owners or controllers and must be submitted to FinCEN in addition to any information supplied to a state during the entity’s formation or registration.

An Evolving Landscape: Interplay between State Law and the Impact of the CTA on Businesses
It is yet to be seen whether states will adopt similar or identical BOI reporting requirements. As of the date of this post, legislation is pending in New York that would require LLCs to submit BOI to the New York Department of State upon organization or registration with the state. This same legislation also requires existing LLCs to amend their organic documents to include BOI.

Pennsylvania amended its Business Corporation Law effective Jan. 1, 2023, and now requires businesses conducting business in the state to file annual reports containing information regarding the entity itself. Pennsylvania does not currently require reporting of BOI. However, it is likely that Pennsylvania and many other states will soon follow the lead of the federal government and New York in requiring businesses to report BOI on a state level.

Conclusion
The CTA’s adoption is a watershed moment in the regulation of business entities. For the first time, businesses will be required to internally track and monitor their BOI to ensure compliance with the CTA. Moreover, compliance with the CTA will require businesses to evaluate their control structures and contractual relationships. For example, while it may be simple to determine whether a person owns 25% or more of a business, the determination of whether someone “exercises substantial control over” the business may not be so straightforward.

It is strongly recommended that businesses consult an experienced and qualified attorney to determine whether they are subject to the CTA’s reporting requirements, as well as any similar requirements imposed by states in the future.

©2023 Norris McLaughlin P.A., All Rights Reserved

By Rocco L. Beltrami , John F. Lushis, Jr. of Norris McLaughlin P.A.

For more on the Corporate Transparency Act, visit the NLR Corporate & Business Organizations section.

IRS Offers Forgiveness for Erroneous Employee Retention Credit Claims

The Employee Retention Credit (“ERC”) is a popular COVID-19 tax break that was targeted by some unscrupulous and aggressive tax promoters. These promoters flooded the IRS with ERC claims for many taxpayers who did not qualify for the credit. Now, the IRS is showing mercy and allowing taxpayers to withdraw some ERC claims without penalty.

Many taxpayers were very excited about the ERC, which could refund qualified employers up to $5,000 or $7,000 per employee per quarter, depending on the year of the claim. But the requirements are complicated. Some tax promoters seized on this excitement, charged large contingent or up-front fees, and made promises of “risk-free” applications for the credit. Unfortunately, many employers ended up erroneously applying for credits and exposing themselves to penalties, interest, and criminal investigations—in addition to having to repay the credit. For example, the IRS reports repeated instances of taxpayers improperly citing supply chain issues as a basis for an ERC when a business with those issues rarely meets the eligibility criteria.

After months of increased focus, the IRS halted the processing of new ERC claims in September 2023. And now, the IRS has published a process for taxpayers to withdraw their claims without penalty. Some may even qualify for the withdrawal process if they have already received the refund check, as long as they haven’t deposited or cashed the check.

For those who have already received and cashed their refund checks, and believe they did not qualify, the IRS says it will soon provide more information to allow employers to repay their ERC refunds without additional penalties or criminal investigations.

© 2023 Miller, Canfield, Paddock and Stone PLC
For more articles on the IRS, visit the NLR Tax section.

E-Scooter and E-Bike Injuries Soar

Injuries caused by e-scooters and e-bikes increased steeply from 2021 to 2022, highlighting the serious risks associated with these transportation devices (officially known as “micromobility products”).

According to a new report from the U.S. Consumer Product Safety Commission (CPSC), titled “Micromobility Products-Related Deaths, Injuries, and Hazard Patterns,” these kinds of injuries increased by almost 21 percent from 2021 to 2022.

This marks the continuation of an alarming upward trend, illustrating that the 2023 increase is much more than a fluke: these types of injuries have increased by an average of 23 percent each year since 2017.

Digging into the data on e-bike injuries

To help you better understand the new data on micromobility devices, here are some of the most notable revelations from the latest CPSC report:

  • 46% of all e-bike injuries from 2017 to 2022 occurred in 2022.
  • Although children under the age of 15 constitute only 18 percent of the U.S. population, they made up 36 % of those injured by micromobility devices from 2017 to 2022.
  • There were 360,800 micromobility product-related emergency department visits from 2017 to 2022.
  • From January 2021 to November 2022, there were 19 deaths associated with micromobility device fires.

In light of the dangers of e-bikes and related devices—now backed up by this extensive and detailed data—CPSC called for “more than 2,000 manufacturers, importers, distributors and retailers of [micromobility devices] to review their product lines and ensure they comply with established voluntary safety standards to reduce the serious risk of dangerous fires with these products or face possible enforcement action.”

E-bike and e-scooter safety tips

While using an electric bike or scooter can be dangerous, there are numerous ways to protect yourself so you can enjoy these devices’ physical and mental health benefits while minimizing their overall risks:

Micromobility device-specific safety tips

  • According to CPSC, you should only use micromobility devices that you are certain were “designed, manufactured, and certified for compliance with the applicable consensus safety standards.”
  • Only use the supplied charger to charge your e-bike or related device, and only charge it when you’re present (in case of a dangerous malfunction). Always make sure to unplug it when you’re done charging.
  • Only use an approved replacement battery pack; likewise, never use a micromobility device with a battery pack that was modified with used cells or by unqualified individuals.
  • Do not dispose of lithium batteries in the trash. Bring used batteries to a hazardous waste collection center or specialized battery recycler.

General bike and scooter safety tips

  • Always wear a helmet in case of a fall.
  • Every time you take out your bike/scooter, check the following parts for damage:
    • Handlebars
    • Brakes
    • Throttle
    • Bell
    • Lights
    • Tires
    • Cables
    • Frame
  • To ensure vehicles and pedestrians can see you, slow down, remain aware of your surroundings, and use your bell or horn to let others know you’re there.
  • Do not ride your bike or scooter after consuming alcohol or other drugs.
  • Don’t share your scooter with another person. Only one person should ride it at a time.
  • Avoid bumps and other obstacles

If you’ve been injured by an e-bike or another lithium battery-powered device, you have options for asserting your rights and may be entitled to compensation. With the support of a legal team that understands micromobility-related injuries, your case will have the best possible chance of succeeding.

COPYRIGHT © 2023, STARK & STARK
For more articles on e-bike and e-scooter injuries, visit the NLR Personal Injury section.

How to Grow Your Law Firm Blog & Attract More Clients

Despite what many marketers might have you believe, blogging is not dead – not even close. Blogging is still one of the best tools a business has for generating organic traffic, drumming up engagement, and improving customer retention.

And blogging works for law firms as well. Law firms can use blogging to share business updates, grow an email list, demonstrate thought leadership, and – yes – even attract new clients.

In this guide, we’re talking all about how to grow your law firm blog. We’ll share loads of tips for how to improve your blog’s SEO and draw in more clients!

What is a Blog, Really?

A blog is more than just a medium for sharing your thoughts with the online world – a common misconception. No, a blog is really a digital tool that people and businesses can use to generate traffic, grow an online community, attract customers, and so much more.

A blog is usually a scrolling feed of posts on your website. And while you may post on your blog once in a while, many law firms aren’t taking full advantage of the benefits a blog can bring for their business.

The (Many) Perks of Blogging for Law Firms

There are many benefits to keeping up with your law firm blog. It’s not just for optics! Having an active blog is a great way to increase traffic and capture the attention of potential clients.

Here are just a few of the (many) benefits of blogging for law firms:

  • Client education: Many people are confused about (or unaware) of their legal rights, or the intricacies of the legal process. You can use your blog to educate new and potential clients, helping them make informed decisions regarding their case.
  • Thought leadership: Blogging gives you a platform for showcasing your knowledge, sharing expertise, and demonstrating thought leadership. This can set you apart from your competitors and build trust with potential clients.
  • Organic traffic: Updating your blog with relevant content can boost your website’s search engine rankings, making it easier for potential clients to find you online.
  • Build loyalty: Foster a sense of loyalty with existing clients by sharing valuable, easy-to-understand insights regarding legal issues, processes, and solutions.
  • Lead generation: A well-written blog can act as a magnet for attracting potential clients. When readers find the content useful, they’re more likely to reach out to work with you.
  • Networking opportunities: Great blog content can get picked up by other publications and legal professionals, landing you speaking engagements, networking opportunities, referrals, and more.
  • Social media content: Blog articles can be repurposed and shared on social media, driving even more traffic back to your law firm’s website.
  • Brand identity: Blogging allows you to control your brand narrative, showcase your firm’s values, and talk about the topics that matter most to your audience.
  • Ethical fulfillment: Many jurisdictions encourage attorneys to provide public education. Blogging can be a way to fulfill this legal ethical obligation.

6 Tips for Growing Your Law Firm Blog

Ready to grow your law firm blog? If so, you’ll want to incorporate these tips. Learn more about SEO, audience engagement, copywriting, and more to see better results from your blog.

1. SET YOUR BLOGGING GOALS

Don’t skip this step! Many business owners jump into blogging without setting specific goals, which is a surefire way to end up burning out or getting frustrated that you aren’t seeing “results”.

You have to define what “results” means for you. Do you want more organic traffic? More form fills on your website? More shares on social media? Setting your goals matters!

There are other types of goals you can set as well. For example, you might set a goal to:

  • Post on your blog once per week
  • Land a guest posting opportunity on another legal blog
  • Generate 10 new backlinks to your website
  • Feature an industry leader on your blog
  • Learn how to create engaging blog graphics
  • Establish a social media sharing strategy for your blog

No matter the objective, it can be helpful to set goals because it will help you 1) determine the next steps you need to take, 2) recognize your wins along the way, 3) set a clear measure of success, and 4) stay motivated to keep blogging.

So, think about why blogging is important for your law firm and what you want to accomplish with your blogging strategy.

Brad Koffel had this to say about his law firm’s blogging strategy:

“At the top of the funnel are potential consumers of legal services who are doing their own research or they are simply interested in a topic. At the bottom of the funnel are prospective clients who are ready to retain a lawyer. Part of my firm’s DNA is offering valuable, timely experience-based information to these folks. At the very minimum we’ve helped someone without investing any additional labor or overhead. At the maximum, it generates a lead to our intake specialists while reinforcing our firm as a statewide leader in criminal defense.”

2. FIND YOUR BRAND VOICE

Don’t be like every other law firm blog out there. Instead, figure out what makes your law firm unique and how to incorporate that identity into your blog content.

For example, your law firm may be “small town” status and family-owned. Your blog should likely convey, then, a sense of familiarity, trust, and support.

Alternatively, your law firm may be high-charged, corporate, and ambitious. With that, your blog content might sound more direct and energetic.

Revisit your law firm’s mission statement (if you have one) or otherwise think about what makes your firm different from your competitors. Then, determine what you want your brand voice to sound like: corporate, friendly, professional, funny, animated, compassionate, etc.

Once you’ve established your brand voice, this will be the guidepost for crafting blog content that’s on-brand and suited for your target audience. It will help you stand out from other firms and build trust with potential clients, who come to know what makes your brand unique.

If you’re not great at writing, consider having someone on your team write the content or work with an experienced copywriter who can capture your brand’s voice in your blog.

Attorney Digger Earles has seen blogging pay off for his law firm in terms of SEO and conversions:

“We feature a combination of firm news and blog posts about specific issues people might experience after they have been injured. The blog posts targeting specific queries draw people to the website, and our firm news converts them when they are doing research on us, deciding between us and other law firms. Also, our domain ranking has consistently been higher than ever over the past month or so, at 36. We were averaging 31/32 in 2022.”

3. CREATE A BLOGGING PLAN

“Winging it” when it comes to your blog can lead to you wasting time (or money) creating content that doesn’t generate any results. While sometimes you get lucky, the best way to create consistent, traffic-generating content is to make a plan.

This starts with conducting keyword research to determine what topics your audience is searching for, relevant to your areas of expertise.

Tools like Semrush.com and Ahrefs.com allow you to search for topics, find relevant keywords, and see the search volume and competition level for each. For most firms, going after low competition, mid-to-high volume keywords is a safe bet.

Then, once you have a few select topics, you can line them up to create your blogging schedule.

For example, say you determine that you want to target the keywords “how to contest a will”, “file for child custody California”, “calculate child support payments”, and “legal rights of grandparents”. These keywords could be used for the following blog topics:

  • “How to Contest a Will and Testament – 5 Steps”
  • “4 Steps to Filing for Child Custody in California”
  • “How to Calculate Child Support Payments”
  • “Legal Rights of Grandparents in California: What You Need to Know”

Once you’ve established your target keywords and the associated blog titles, you can create a blogging schedule. This will vary depending on your bandwidth to create new content.

Here’s how one law firm is growing their blog by keeping up with a consistent schedule:

“To make DiBella Law Office’s blog a powerful lead generation tool we try to maintain a consistent posting schedule, promote it through various channels, and incorporate lead generation forms to capture visitor information. We try to showcase our firm’s expertise and engage with readers. We use our blog to try to establish trust, credibility, and a strong online presence, ultimately generating valuable leads in the legal industry.” – Chris DiBella, DiBella Law Office

Conducting keyword research before writing new posts will allow you to target topics that potential clients are actively searching for in Google. Then, with blogging SEO, you can attract these users and drive more potential clients to your website.

4. IMPLEMENT BLOGGING SEO BEST PRACTICES

You don’t have to be a law firm SEO expert to drive more traffic to your blog. All you need to do is implement the basics to ensure your blog posts are capable of being crawled and indexed by search engines.

When writing and optimizing a blog posts, here are the steps you should follow:

  • Craft a compelling title that includes your target keyword (or a close variation) to improve rankings and entice clicks
  • Write high-quality content that thoroughly covers your target topic and provides value to your audience
  • Organize your content with headings (H1, H2s, H3s, and H4s) to make your content easy to “scan” and “read” by search engines and users
  • Include relevant images, graphics, and/or videos to increase engagement
  • Add internal links to related content (blog posts or pages) on your website
  • Add external links to related (authoritative) sources, publications, or articles
  • Include a concise yet descriptive meta description that explains what your blog post is about
  • Add social sharing buttons to encourage readers to share your content on X, Facebook, Instagram, LinkedIn, etc.
  • Proofread and edit your content for grammar, spelling, and tone of voice
  • Use a succinct but descriptive URL, ideally without “stop” words (e.g. “of”, “and”, “the”)

Of course, there are many more strategies for improving your law firm’s SEO, such as mobile optimization, Featured Snippets, and local optimization, so be sure to check out additional resources to support your overall strategy.

Here’s what these attorneys had to share about how blogging has benefited their businesses:

“At Vaughan & Vaughan we believe the answer to this question is pretty simple. As we approach every interaction, whether online, during a free consultation, or as we work on a case, we focus on providing real value in our services.” – Charles Vaughan, Vaughan & Vaughan

“Our blog emphasizes educational content tailored to Personal Injury cases, particularly for Georgia, empowering our audience with the knowledge needed for informed decisions. By addressing concerns and offering localized insights, we build trust and confidence, increasing conversion rates as potential clients feel better prepared to engage with our firm.” – Jody David, John Foy

“Blogging has helped enhance our firm’s online presence and credibility by providing valuable legal insights and information to our potential clients. It also helped establish our firm as an authority in our field, helping to attract and retain clients seeking our legal services.” – Michael Simmrin, Simmrin Law Group

“Blogging has been instrumental in helping my law firm reach a wider audience and connect with potential clients. By sharing informative articles and legal expertise, we’ve not only established ourselves as trusted authorities in our field but also fostered meaningful relationships with individuals seeking our legal services.” – Bob Goldwater, Birth Injury Lawyers Group

5. PROMOTE YOUR CONTENT ON OTHER PLATFORMS

While your goal may be to drive more organic traffic from search engines, why wait for this traffic when you could get traffic from other platforms as well? It’s best to have a social media sharing strategy so you can also get traffic from X, LinkedIn, Instagram, Pinterest, and Facebook.

You can use graphic design tools like Canva.com to create custom graphics to share alongside your blog post on social media. You can even write your social media captions in advance, or use AI tools like ChatGPT to write social media copy for you!

When sharing your blog posts on social media, be sure to include an attention-grabbing caption and relevant hashtags.

Here’s an example of a social media caption for a law firm blog post:

“Navigating child custody laws can be complex and emotional. Dive into our latest blog post to demystify the process and know your rights as a parent. ✒️📖 #ChildCustody #FamilyLawInsights Click the link in our bio to read more about it!”

6. PUSH YOUR BLOG POSTS OUT TO YOUR EMAIL LIST

Another way to promote your blog is to share your latest posts out to your email list.

If you don’t already have an email list – don’t worry. You can also use your blog to GROW your email list by embedding an email signup form within your blog posts.

If you do have an email list, then you can use an email marketing tool like MailerLite to design email templates, write your email copy, schedule your emails, and check subscribes/unsubscribes. You can add links to your most recent blog posts, directing more users to your website.

You can also generate blog post ideas directly from your audience. Simply send out an email to your list asking subscribers what topics they care about or what questions they have. You can then turn these ideas into new blog posts!

Attorney Tom Anelli at DWI Tom uses his blog to speak to the interests of his target audience:

“I use blog posts to generate leads by knowing my audience and addressing their specific concerns with helpful content. I also select blog topics that are likely to engage comments and respond quickly, and in the past, I’ve offered free resources (like eBooks or guides) which require my readers to provide their contact information.”

Feel free to use this email template to generate more blog post ideas:

“Subject: We Want to Hear From You!

Dear [Recipient’s Name],

I hope this email finds you well. At [Law Firm’s Name], we’re constantly looking for ways to better serve our community and valued clients like you.

Our blog has always been a platform where we aim to provide insights, answer pressing questions, and shed light on the many facets of the legal world. As we plan our content for the upcoming months, we want to ensure it’s not only informative but also relevant to your needs.

And that’s where you come in!

We would love to hear from you about the topics, questions, or legal issues you’re most curious about. Whether it’s a deep dive into a specific law, tips for navigating certain legal processes, or just general legal advice, your input will be invaluable in guiding our content creation.

Kindly reply to this email with any suggestions or topics you’d like us to cover. Your feedback is the cornerstone of our commitment to continuous learning and sharing.

Thank you for being an essential part of the [Law Firm’s Name] community. We eagerly await your insights!

[Your Name]

[Law Firm’s Name]”

Make Your Law Firm Blog Work for You

Your law firm’s blog is a powerful tool for generating more organic traffic and leads. With SEO, you can capture the attention of people who are already searching for services like yours. With social media and email, you can drive more users to your blog and even attract new clients.

If you’re not keeping up with your blog, you may be missing out on more traffic and potential clients. By implementing a blogging plan, you can focus on creating better content (quality over quantity) and start seeing better results from your efforts.

It’s time to use your blog to grow your business. Implement the tips above to get more traffic, boost engagement, increase your authority, and draw in more clients!

Article by Jason Hennessey of Hennessey Digital

Copyright 2023 © Hennessey Digital
For more articles on legal marketing, visit the NLR Law Office Management section.

Is ‘Freedom-Washing’ the New Greenwashing, and What Are Its Legal Consequences?

Companies will often make representations about modern slavery as part of their environmental, social and governance (ESG) measures.

In this article, we consider whether potentially false or misleading claims about modern slavery (i.e., freedom-washing) may be further called out by Australian regulatory bodies.

‘Freedom-washing’ is a term that can be used to describe a false or misleading claim by an organisation about the positive work being done to identify, assess and combat its modern slavery risks.

Even an understatement or nonstatement of an organisation’s modern slavery risks in its supply chains and operations may be considered ‘freedom-washing’ if it has the intent or effect to mislead the reader (for example, if the organisation’s responses appear overall to be more positive than they would otherwise appear in that light).

‘Freedom-washing’ will not necessarily involve an overtly false action. In some circumstances, a claim may not be entirely accurate despite being partly accurate.

An organisation required to report under the Modern Slavery Act 2018 (Cth) (Modern Slavery Act) needs to carefully consider the information it releases about its modern slavery risks and responses and whether it is potentially engaging in ‘freedom-washing.’

Importantly for all current and future reporting organisations, the scrutiny continues to mount around the legislative framework combatting modern slavery (including in terms of reporting, offences and penalties).

This scrutiny is highlighted by the release of the following recent important reports and studies:

  • The statutory report of the Modern Slavery Act (see here);
  • The targeted review of Divisions 270 and 271 of the Criminal Code 1995 (Cth) (see here); and
  • The Modern Slavery Index (see here).

AUSTRALIAN COMPETITION AND CONSUMER COMMISSION (ACCC) / AUSTRALIAN CONSUMER LAW

As previously reported by K&L Gates, the ACCC has released long-anticipated guidance on environmental and sustainability claims (Guidance—see here), which sets out eight principles that businesses should follow when making environmental and sustainability claims and to comply with the Australian Consumer Law (ACL).

Although the Guidance was issued in the context of making environmental and sustainability claims, in our view, its eight principles can be applied equally to guide businesses in making ‘modern slavery’ claims without breaching the ACL. The Guidance encourages businesses to:

  • Make accurate and truthful claims.
  • Have evidence to back up claims.
  • Not leave out or hide important information.
  • Explain any conditions or qualifications on claims.
  • Avoid broad and unqualified claims.
  • Use clear and easy to understand language.
  • Remember visual elements should not give a wrong impression.
  • Be direct and open.

The ACL contains a broad prohibition against businesses engaging in misleading or deceptive conduct and prohibits the making of false or misleading representations about specific aspects of goods or services. As a result, claims that overstate an organisation’s modern slavery commitments generally, or inaccurately portray the working conditions within certain supply chains, may contravene the ACL.

We therefore recommend that organisations should also reflect on the Guidance when preparing a modern slavery statement or releasing information on modern slavery practices.

Breaches of the ACL incur very significant penalties. For corporations, the maximum pecuniary penalty per breach is the greater of:

  • AU$50 million;
  • Three times the value of the ‘reasonably attributable’ benefit obtained from the conduct; or
  • If this benefit cannot be determined, 30% of the corporation’s adjusted turnover during the breach turnover period (being a minimum of 12 months).

The ACCC will consider whether the following factors apply when determining whether to take enforcement action for a breach of the ACL:

  • The conduct is of significant public interest or concern;
  • The conduct results in substantial harm to consumers and detriment to business competitors;
  • Large businesses are making claims on a national scale;
  • The conduct involves a significant new or emerging market issue, or compliance or enforcement action is likely to have an educative or deterrent effect; or
  • ACCC action will help clarify aspects of the law, especially newer provisions of the ACL.

Furthermore, the ACCC will take into account the genuine efforts and appropriate steps that were taken by the business to verify the accuracy of any information they relied on.

But is there actually any appetite in the ACCC to seek to enforce the ACL with respect to ‘modern slavery’ claims?

To date, it has not given any indication that ‘modern slavery’ claims will be an enforcement priority. However, the ACCC has demonstrated a willingness to crack down on businesses that have sought to take advantage of increasingly environmentally and socially conscious consumers (e.g. greenwashing). Combined with growing scrutiny and broadening calls for tougher responses to be taken by government and business in combatting modern slavery, the possibility of ACCC action does appear to exist, if not now, then in the not too distant future.

AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION (ASIC) / FINANCIAL PRODUCTS AND DISCLOSURE OBLIGATIONS

General Provisions

The Corporations Act 2001 (Cth) (Corporations Act) and the Australian Securities and Investments Commission Act 2001 (Cth) both contain general prohibitions against companies:

  • Making statements or circulating information that is false or misleading; or
  • Engaging in dishonest, misleading or deceptive conduct in relation to a financial product or financial service.1

ASIC released Report 763 earlier in the year (read it here), which expanded on its approach to ‘greenwashing’ outlined in Information Sheet 271 (read it here). It detailed ASIC’s recent interventions in response to growing claims from companies, managed funds and superannuation funds about their ESG credentials.

ASIC has expanded both its surveillance and enforcement activities in regards to ‘greenwashing.’ ASIC has pursued civil penalty proceedings and issued infringement notices to companies that are making statements that are false or misleading about ESG ‘greenwashing’ claims.

In light of these actions in the ESG space, we recommend companies be vigilant about the information they include in their modern slavery statements and be careful about the modern slavery disclosures they make in relation to a financial product or service.

Product Disclosure Statements

Under section 1013D(1)(l) of the Corporations Act, if a financial product has an investment component, its issuer must include in the product disclosure statement the extent to which labour standards or environmental, social or ethical considerations are taken into account in selecting, retaining or realising an investment. This is relevant in the modern slavery context where companies are releasing product disclosure statements that refer to modern slavery ESG considerations or make reference to previous market disclosures on modern slavery practices.

ASIC has undertaken reactive and proactive surveillance of product disclosure statements, advertisements, website and other market disclosures. ASIC is also progressing surveillance of the superannuation fund sector on ESG claims.

International Sustainability Standards Board (ISSB) Standards for Disclosure

In addition to ASIC’s enforcement powers, the ISSB has introduced two new standards, IFRS S1 and S2. The standards are likely to be substantially aligned to the mandatory climate-related disclosures in Australia being prepared by the Australian Accounting Standards Board and the Treasury.

Relevant to modern slavery, the new standard IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information requires an entity to disclose information about its sustainability-related risks and opportunities in its general purpose financial reports (read it here).

To achieve the required fair presentation of sustainability-related financial information, an entity is required to provide a complete, neutral and accurate depiction of those sustainability-related risks and opportunities. Additionally, any material information must be disclosed. Information can be material where it omits, misstates or obscures information that could reasonably be expected to influence the decision making of readers of such reports.

‘Sustainability-related risks and opportunities’ are broadly defined as risks and opportunities that could reasonably be expected to affect an entity’s cash flows or access to finance. Anything that impacts an entity’s value chain will be an opportunity or risk to its cash flows. The entity’s work force is an example of a sustainability-related risk and opportunity. Therefore, reporting entities may have to report modern slavery in their supply chains as a material risk to their value chain, particularly if they are operating in a sector where the risk of modern slavery is heightened (for example, renewable energy projects or garment manufacturing).

While compliance with the ISSB standards remains voluntary until codified under Australian law, it is expected that the standards will be widely adopted by companies internationally.

OTHER CONSEQUENCES OF FREEDOM-WASHING

There are many other potential legal consequences of freedom-washing. These include:

  • Criminal liability under section 137.1 of the Criminal Code Act 1995 (Cth): This offence applies where a person knowingly gives information that is false or misleading or omits any matter or thing without which the information is misleading, and the information is given to a Commonwealth entity;
  • Breach of directors duties: If directors are not appropriately managing and disclosing the company’s modern slavery risks, then they could be in breach of the duty to exercise skill, care and diligence;
  • Requisition resolutions: Shareholders may requisition a resolution at the company’s annual general meeting in regards to modern slavery and the company’s supply chain practices; and
  • Shareholder class action: Shareholders may start a class action if the company has breached continuous disclosure laws by not reporting a modern slavery issue correctly or accurately.

INTRODUCTION OF PENALTIES UNDER THE MODERN SLAVERY ACT

The report on the statutory review of the Modern Slavery Act was released on 25 May 2023.

Its recommendations included that the Modern Slavery Act be amended to provide that it is an offence for a reporting entity to:

  • Fail, without reasonable excuse, to give the minister a modern slavery statement within a reporting period for that entity;
  • Give the minister a modern slavery statement that knowingly includes materially false information;
  • Fail to comply with a request given by the minister to the entity to take specified remedial action to comply with the reporting requirements of the Modern Slavery Act; and
  • Fail to have a due diligence system in place that meets the requirements set out in rules made under section 25 of the Modern Slavery Act.

The Australian Government has signaled it will now consider Professor John McMillan’s review and will consult across government and with stakeholders in formulating its response to the recommendations. Companies operating business in Australia should watch this space carefully.

We acknowledge the contributions to this publication from our graduate Harrison Langsford.

FOOTNOTES

1 See sections 1041E, 1041G and 1041H of the Corporations Act 2001 (Cth), and sections 12DA and 12DB of the Australian Securities and Investments Commission Act 2001 (Cth).

Copyright 2023 K & L Gates
Article by Michael Hain , Ayman Guirguis , Clive Cachia of K&L Gates
For more articles on ESG, visit the NLR Environmental, Energy & Resources section.

Cybersecurity Awareness Dos and Donts Refresher

As we have adjusted to a combination of hybrid, in-person and remote work conditions, bad actors continue to exploit the vulnerabilities associated with our work and home environments. Below are a few tips to help employers and employees address the security threats and challenges of our new normal:

  • Monitoring and awareness of cybersecurity threats as well as risk mitigation;
  • Use of secure Wi-Fi networks, strong passwords, secure VPNs, network infrastructure devices and other remote working devices;
  • Use of company-issued or approved laptops and sandboxed virtual systems instead of personal computers and accounts, as well as careful handling of sensitive and confidential materials; and
  • Preparing to handle security incidents while remote.

Be on the lookout for phishing and other hacking attempts.

Be on high alert for cybersecurity attacks, as cybercriminals are always searching for security vulnerabilities to exploit. A malicious hacker could target employees working remotely by creating a fake coronavirus notice, phony request for charitable contributions or even go so far as impersonating someone from the company’s Information Technology (IT) department. Employers should educate employees on the red flags of phishing emails and continuously remind employees to remain vigilant of potential scams, exercise caution when handling emails and report any suspicious communications.

Maintain a secure Wi-Fi connection.

Information transmitted over public and unsecured networks (such as a free café, store or building Wi-Fi) can be viewed or accessed by others. Employers should configure VPN for telework and enable multi-factor authentication for remote access. To increase security at home, employers should advise employees to take additional precautions, such as using secure Wi-Fi settings and changing default Wi-Fi passwords.

Change and create strong passwords.

Passwords that use pet or children names, birthdays or any other information that can be found on social media can be easily guessed by hackers. Employers should require account and device passwords to be sufficiently long and complex and include capital and lower case letters, numbers and special characters. As an additional precaution, employees should consider changing their passwords before transitioning to remote work.

Update and secure devices. 

To reduce system flaws and vulnerabilities, employers should regularly update VPNs, network infrastructure devices and devices being used to for remote work environments, as well as advise employees to promptly accept updates to operating systems, software and applications on personal devices. When feasible, employers should consider implementing additional safeguards, such as keystroke encryption and mobile-device-management (MDM) on employee personal devices.

Use of personal devices and deletion of electronic files.

Home computers may not have deployed critical security updates, may not be password protected and may not have an encrypted hard drive. To the extent possible, employers should urge employees to use company-issued laptops or sandboxed virtual systems. Where this is not possible, employees should use secure personal computers and employers should advise employees to create a separate user account on personal computers designated for work purposes and to empty trash or recycle bins and download folders.

Prohibit use of personal email for work purposes.

To avoid unauthorized access, personal email accounts should not be used for work purposes. Employers should remind employees to avoid forwarding work emails to personal accounts and to promptly delete emails in personal accounts as they may contain sensitive information.

Secure collaboration tools.

Employees and teams working from home need to stay connected and often rely on instant-messaging and web-conferencing tools (e.g., Slack and Zoom). Employers should ensure company-provided collaboration tools, if any, are secure and should restrict employees from downloading any non-company approved tools. If new collaboration tools are required, IT personnel should review the settings of such tools (as they may not be secure or may record conversations by default), and employers should consider training employees on appropriate use of such tools.

Handle physical documents with care.

Remote work arrangements may require employees to take sensitive or confidential materials offsite that they would not otherwise. Employees should be advised to handle these documents with the appropriate levels of care and avoid printing sensitive or confidential materials on public printers. These documents should be securely shredded or returned to the office for proper disposal.

Develop clear guidelines and train employees on cyberhygiene.

To ensure employees are aware of remote work responsibilities and obligations, employers should prepare clear telework guidelines (and incorporate any standards required by applicable regulatory schemes) and post the guidelines on the organization’s intranet and/or circulate the guidelines to employees via email. A list of key company contacts, including Human Resources and IT security personnel, should be distributed to employees in the event of an actual or suspected security incident.

Prepare for remote activation of incident response and crisis management plans.

Employers should review existing incident response, crisis management and business continuity plans, as well as ensure relevant stakeholders are prepared for remote activation of these plans, such as having hard copies of relevant plans and contact information at home.

DO DON’T
 

  • DO create complex passphrases
  • DO change home Wi-Fi passwords
  • DO create a separate Wi-Fi network for guests
  • DO install anti-malware and anti-virus software for internet-enabled devices
  • DO keep software (including anti-virus/anti-malware software), web browsers, and operating systems up-to-date
  • DO delete files from download folders and trash bins
  • DO immediately report lost or stolen devices
  • DO log off accounts and close windows and browsers on shared devices
  • DO review mobile app settings on shared devices
  • DO handle physical documents with sensitive and/or confidential information in a secure manner

 

  

  • Do NOT use public or unsecure Wi-Fi networks without using VPN
  • Do NOT access or send confidential information over unsecured Wi-Fi networks
  • Do NOT leave electronic or paper documents out in the open
  • Do NOT allow family or friends to use company-provided devices
  • Do NOT leave devices logged-in
  • Do NOT select “remember me” on shared devices
  • Do NOT share passwords with family members
  • Do NOT use names or birthdays in passwords
  • Do NOT save work documents locally on shared devices
  • Do NOT store confidential information on portable storage devices, such as USB or hard drives

 
©2023 Katten Muchin Rosenman LLP
Article by Trisha Sircar of Katten
For more articles on cybersecurity, visit the NLR Communications, Media & Internet section,

Navigating the Updated Federal Trade Commission Guidelines for Social Media Influencer Marketing

The Federal Trade Commission (FTC) recently updated its Guides Concerning Use of Endorsements and Testimonials in Advertising (Guidelines). There has not been an update to the Guidelines since 2009, before TikTok even existed and Facebook was still the hip new kid on the block.

Clearly, a lot has changed since then, and being aware of and understanding the updates to these Guidelines is crucial for companies, influencers, brand ambassadors, and marketing professionals who engage in influencer marketing campaigns. The Guidelines take into account the evolving nature of influencer marketing and provide more specific guidance on how influencers can make clear and conspicuous disclosures to their followers. This summary provides a basic overview of the key changes and important points to consider in the wake of the updated Guidelines.

Background:

Anyone who has access to the internet is aware that social media influencer marketing has been a rapidly growing industry over the past decade, and the FTC recognizes the need for adequate transparency concerning this area of marketing to protect consumers from deceptive advertising practices.

The general aim of the updated Guidelines is to ensure consumers can clearly identify when a social media post, blog post, video, or other similar media is sponsored or contains affiliate links. The updated Guidelines seek to develop or make clear guidance concerning specifically: (1) who is considered an endorser; (2) what is considered an “endorsement”; (3) who can be liable for a deceptive endorsement; (4) what is considered “clear and conspicuous” for purposes of disclosure; (5) practices of consumer reviews; and (6) when and how paid or material connections need to be disclosed.

Key Changes and Considerations:

  1. Clear and Conspicuous Disclosure: Influencers must make disclosures clear and conspicuous. This means disclosures should be easily noticed, not buried within a long caption or hidden among a sea of hashtags. The Guidelines require that disclosure be “unavoidable” when posts are made through electronic mediums. The FTC suggests placing disclosures at the beginning of a post, especially on platforms where the full content can be cut off (i.e., Instagram). In broad terms, a disclosure will be deemed “clear and conspicuous” when “it is difficult to miss (i.e. easily noticeable) and easily understandable by ordinary consumers.”
  • Updated Definition of “endorsements”: The FTC has broadened its definition of “endorsements” and what it deems to be deceptive endorsement practices to include fake positive or negative reviews, tags on social media platforms, and virtual (AI) influencers.
  • Use of Hashtags: The Guidelines still hold that commonly used disclosure hashtags such as #ad, #sponsored, and #paidpartnership are acceptable, but those must be displayed in a manner that is easily perceptible by consumers. Influencers should avoid using vague or ambiguous hashtags that may not clearly indicate a paid relationship. Keep in mind, however, whether a specific social media tag counts as an endorsement disclosure is subject to fact-specific review.
  • In-Platform Tools: Social media platforms increasingly provide built-in tools for influencers to mark their posts as sponsored. However, be aware, the Guidelines emphasize that these tools can be helpful in disclosing partnerships, but they are not always sufficient to ensure that disclosures are clear and conspicuous. Parties using these tools should carefully evaluate whether they are clearly and conspicuously disclosing material connections.
  • Affiliate Marketing: If an influencer includes affiliate links in their content, they must disclose this relationship. Simply using affiliate links is considered a material connection and requires disclosure. Phrases such as “affiliate link” or “commission earned” can be used to disclose affiliate relationships.
  • Endorsements and Testimonials: The FTC guidelines apply not only to sponsored content, but also to endorsements and testimonials. Influencers must disclose material connections with endorsing products, whether they received compensation or discounted/free products. Beyond financial relationships as described above, influencers will need to disclose non-financial relationships, such as being friends with a brand’s owners or employees.
  • Ongoing Relationships: Disclosures should be made in every post or video if a material connection for benefit exists, even in cases of ongoing or long-term partnerships.
  • Endorsements Directed at Children: The updated Guidelines added a new section specifically addressing advertising which is focused on reaching children. The FTC states that such advertising “may be of special concern because of the character of audience”. While the Guidelines do not offer specific guidance on how to address advertisements intended for children, those who intend to engage in targeting children as the intended audience should pay special attention to the “clear and conspicuous” requirements espoused by the FTC.

Enforcement and Penalties:

The FTC takes non-compliance with these guidelines seriously and can impose significant fines and penalties on brands, marketers, and influencers who fail to make proper disclosures. Significantly, the updated Guidelines make it clear that influencers who fail to make proper disclosures may be personally liable to consumers who are misled by their endorsements. Furthermore, brands and marketers may also be held responsible for ensuring that influencers with whom they have paid relationships adhere to these guidelines.

Conclusion:

Bear in mind, the Guidelines themselves are not the law, but they serve as a vital guide to avoid breaking it. Overall, the updated Guidelines on influencer disclosures emphasize transparency and consumer protection. To stay compliant and maintain consumer trust, it is imperative that all parties involved in influencer marketing familiarize themselves with these Guidelines and ensure that disclosures are clear, conspicuous, and consistently made in every relevant post or video. Furthermore, as this marketing industry continues to develop and evolve, it will be increasingly important to monitor ongoing developments and changes in the FTC guidelines to stay current with best practices.

© 2023 Varnum LLP
For more articles on communications, visit the NLR Communications, Media and Internet section.

Do Federal Civil Rights Laws Prohibit Discrimination Based on Sex and Age?

Harvard Business Review’s recent survey, “Women in Leadership Face Ageism at Every Age,” shines a bright light on the bleak reality of age discrimination against women in the workplace.  The survey of 913 women leaders from across the United States in the higher education, faith-based nonprofit, legal, and health care industries found that supervisors and colleagues find women of every age unfit for leadership roles based on their age.  Young women leaders are subjected to head pats and pet names and are often mistaken for students, interns, or support staff.  Middle aged women leaders are discounted as having too many family responsibilities or being on the runway to menopause.  Older women are largely erased from the work environment, facing assumptions that they are on their way out.  This stands in stark contrast to older men, whom employers tend to regard as “wells of wisdom.”  In short, when it comes to the workplace, age-related bias perpetually stands between women and recognition as leaders.

Title VII of the Civil Rights Act of 1964 (“Title VII”), which prohibits discrimination in employment, identifies certain “protected classes” upon which bases employers may not discriminate: race, color, religion, sex, and national origin.  A separate statute, the Age Discrimination in Employment Act (“the ADEA”), outlaws age discrimination in the workplace.  Plaintiffs filing a lawsuit challenging employment discrimination typically must articulate a specific statute their employer has violated.  In the case of sex-plus-age discrimination—that is, mistreatment based on the intersection of sex and age—neither statute standing alone captures the plaintiff’s experience.[1]  This raises the question of how women facing uniquely gendered age bias in the workplace—like that outlined in the Harvard Business Review survey—can state legal claims a court will consider viable.

For the most part, federal courts have been skeptical of such claims.

A recent case, however, brought a new perspective to the question of sex-plus-age discrimination under federal law.  On July 21, 2020, the United States Court of Appeals for the Tenth Circuit, the appellate court that covers Colorado, Kansas, New Mexico, Oklahoma, Utah, and Wyoming, addressed the question “whether sex-plus-age claims are cognizable under Title VII.”[2]  In Frappied v. Affinity Gaming Black Hawk LLC, nine female plaintiffs brought (among other claims) sex-plus-age claims for disparate impact and disparate treatment under Title VII, alleging they were terminated because Affinity discriminated against women over forty.[3]  The older women, who had worked at the Golden Mardi Gras Casino, were laid off after the defendant purchased the casino in 2012.  The terminations were largely unexplained.  After the lower court dismissed their claims, the plaintiffs appealed.

The Tenth Circuit ruled in the plaintiffs’ favor, affirming the validity of sex-plus-age claims under Title VII alone.  The court noted that it had allowed claims based on a combination of race and sex discrimination in Hicks v. Gates Rubber Co.[4]In Hicks, the court considered the combined effect of racial slurs and sexual harassment in a hostile work environment case.  In Frappied, however, the court had to decide a novel question—whether an intersectional discrimination claim could be based on a second characteristic that is not protected by Title VII: age.  Most courts that have considered such claims have refused to decide whether a plaintiff can challenge discrimination under an intersectional theory that the combination of the two protected characteristics led to the adverse action, or they have decided the plaintiff can prevail under one statute so the court does not have to decide whether the intersectional claim is viable. For instance, both the Second and Sixth Circuits have sidestepped the issue, making dispositive rulings based on other claims in plaintiffs’ complaints.[5]

In Frappied, the Tenth Circuit noted that the Supreme Court had long held that Title VII prohibits “sex-plus” discrimination where the “plus” factor is not protected under the statute.[6]  In Phillips v. Martin Marietta Corp.[7]the Supreme Court held that a policy against hiring women with preschool-age children violated Title VII, because men with preschool-age children were not subject to that policy.  Even though “people with preschool-age children” is not a protected class, the Supreme Court recognized this to be a form of sex discrimination.  The Tenth Circuit used the same reasoning to hold that if sex—which is protected under Title VII—“play[ed] a role in the employment action,” then the termination was impermissible even though the “plus” factor, age, is in another statute.[8]  Borrowing from the Supreme Court’s analysis in Bostock,[9] which held that Title VII’s sex discrimination provision prohibits sexual orientation and gender identity discrimination in employment, the Tenth Circuit held that “if a female plaintiff shows that she would not have been terminated if she had been a man—in other words, if she would not have been terminated but for her sex—this showing is sufficient to establish liability under Title VII.[10]

While the outcome in Frappied is a positive development for civil rights in employment, in most jurisdictions there is no clear protection under federal law against sex-plus-age discrimination.  The EEOC has long acknowledged the availability of such intersectional claims, but as mentioned, other sex-plus-age claims have made their way through the courts on occasion without success.  The Tenth Circuit is the first and only federal appellate court to formally recognize these claims as viable under federal law.

However, there are state laws that prohibit sex and age discrimination in the same provision,[11] so the federal courts’ unwillingness to combine the effects of discrimination prohibited by two separate statutes is not always a concern.  Given the Harvard Business Review’s exposure of the dire state of workplace age bias against women, and the Tenth Circuit’s groundbreaking decision in Frappied, more women experiencing workplace age discrimination may want to consider challenging their employers’ decisions.  Because of the variations in protections in different jurisdictions, employees should consider seeking legal advice.  If you or someone you know has experienced sex-plus-age bias, contact the experienced lawyers at Katz Banks Kumin today.

[1] The legal standards, particularly the causation standards, also differ under the two statutes.  Under Title VII, it is sufficient to prove that sex was a “motivating factor” in an employment decision.  Under the ADEA, however, age must be the but-for cause, Gross v. FBL Fin. Serv., Inc., 557 U.S. 167 (2009).  Many courts have interpreted this but-for causation standard to mean that if any other reason—even sex, which is a protected class under Title VII—played a role in the employment decision, then the age claims fail.  The Supreme Court recently clarified that “but-for cause” does not mean “sole cause,” Bostock v. Clayton County, 140 S. Ct. 1731 (2020), but the idea has yet to trickle down through the federal courts—and into ADEA claims.

[2] Frappied v. Affinity Gaming Black Hawk, LLC, 966 F.3d 1038, 1045 (10th Cir. 2020).

[3] Id.

[4] 833 F.2d 1406, 1416-17 (10th Cir. 1987)

[5] Gorzynski v. JetBlue Airways Corp., 596 F.3d 93, 110 (2d Cir. 2010) (“Having determined that Gorzynski has provided sufficient evidence of age discrimination to reach a jury, there is no need for us to create an age-plus-sex claim independent from Gorzynski’s viable ADEA claim.”); Schatzman v. Cty. Of Clermont, Ohio, No. 99-4066, 2000 WL 1562819, at *9 (6th Cir. 2000) (“[W]e decline the invitation to decide the ‘sex plus [age]’ charge partly because it is unnecessary for us to do so.”).

[6] 966 F.3d at 1046.

[7] 400 U.S. 542 (1971).

[8] Id. at 1046.

[9] 140 S. Ct. 1731.

[10] Id. at 1047.

[11] See, e.g., D.C. Code Ann. § 2-1401.1.

Katz Banks Kumin LLP Copyright ©
For more articles on workplace discrimination, visit the NLR Civil Rights section.

Internal Investigations Are a Poe Substitute for Compliance

Happy Halloween! In honor of the holiday, we are taking our compliance message in a bit of a . . . spooky direction. But our message remains the same: International transactions are inherently high-risk; they require constant attention and oversight for your compliance to be effective; and it is always better to put your resources into compliance than to spend them on investigations.

Speaking of Halloween, here are some interesting facts about Edgar Allan Poe:

  • Poe ruined a promising start to an army career at West Point by spending his time writing mocking poems about his instructors rather than finishing his assigned work.
  • Poe often wrote only after placing a Siamese cat on his shoulder.
  • The Baltimore Ravens are the only major sports team to be named after a poem, Poe’s “The Raven.”
  • And most importantly, Poe turned down a promising career as a chief compliance officer. Don’t believe me? Check out this recently unearthed initial draft of “The Raven,” and decide for yourself!

Internal Investigations Are a Poe Substitute for Compliance

Once upon a midnight dreary, this Compliance Officer pondered, weak and weary,
Over a list of quaint and curious compliance chores —
While I nodded, nearly napping, suddenly there came a tapping,
As of someone gently rapping, rapping at my chamber door.
“Tis some auditor,” I muttered, “tapping at my chamber door —
Only this and nothing more.”

Ah, distinctly I remember, it was in the bleak December;
When fiscal-year matters come to the fore.
And compliance matters, are quite forgotten,
And talks of investigations, are verboten,
And as welcome as a lingering bedsore,

And yet the knocking — the knocking! — it was far from fleeting.
It thrilled me — it called to me — this was no account-busting lunch meeting!
It filled me with fantastic terrors never felt before.
So that now, to still the beating of my heart, I stood repeating,
“Tis some auditor entreating entrance at my chamber door —
Perhaps some senior officer pleading entrance at my chamber door —
This it is and nothing more.”

Presently my soul grew stronger; had I not mastered SOX? And regs much longer?
“Sir,” said I, “or Madam, truly your forgiveness I implore.
But the fact is I was dreaming, of internal controls, and ethics training,
And so faintly you came tapping, tapping at my chamber door,
That I scarce was sure I heard you” — here I opened wide the door —
Darkness there and nothing more.

Back into the chamber turning, all my soul within me burning,
Soon again I heard a tapping somewhat louder than before.
“Surely,” said I, “surely that is something at my window lattice;
Let me see, then, what threat there is, and this mystery explore —
Let my heart be still a moment and this mystery explore —
’Tis a mistaken Whistleblower and nothing more!”

Open here I flung the shutter, when, with many a flirt and flutter,
In there stepped a stately Raven, a Whistleblower like those of the days of yore.
Not the least obeisance made he; not a minute stopped or stayed he;
But, with mien of lord or lady, perched above my chamber door —
Perched upon a bust of Pallas just above my chamber door —
Perched, and sat, and nothing more.

Then this ebony bird beguiling my sad fancy into smiling,
By the grave and stern decorum of the countenance it wore.
“Though thy crest be shorn and shaven, thou,” I said, “art sure no craven,
Ghastly grim and ancient Whistleblower wandering from the Nightly shore —
Tell me what thy lordly report is from our subsidiaries far off-shore!”
Quoth the Whistleblower Raven: “Your Compliance is Nevermore.”

“Prophet!” said I, “thing of evil! — prophet still, if bird or devil!
By that Heaven that bends above us — by that God we both adore —
Tell this Compliance Officer with sorrow laden if, within our affiliates far offshore,
There are accounting violations or kickback given to dozens or more!
Or payments made to get our products to leave those foreign shores!
Quoth the Whistleblower Raven: “Your Compliance is Nevermore.”

And thus I realized that compliance is toughest when you operate in lands of many scores.
And the Raven, never flitting, still is sitting, still is sitting,
A Whistleblower whose incriminating red flags I ignored,
And his eyes have all the seeming, of an enforcer who is dreaming, of throwing subpoenas on our corporate floor;
And my wretched soul, like our poor compliance, from out that shadow that lies floating on the floor.
Shall be lifted — nevermore!

© 2023 Foley & Lardner LLP
For more articles on internal investigations, visit the NLR Corporate & Business Organizations section.