Circuit Split Clouds Definition of “Whistleblower” under Dodd-Frank Act, Complicating Corporate Compliance

829-Brower_GregjohnsonGuest Commentary

by Greg Brower and Brett W. Johnson, Snell & Wilmer LLP*

A recent decision by the U.S. Court of Appeals for the Second Circuit further complicated the issue of when an employee can be considered a whistleblower under the Dodd-Frank Act. In Berman v. Neo@Ogilvy, the Second Circuit reversed a district court decision that the plaintiff was not a whistleblower, concluding that the governing definition of “whistleblower” was not the one found in the language of Dodd-Frank, but was the broader one found in a subsequently adopted SEC rule. This interpretation runs counter to a 2013 decision from the Fifth Circuit, Asadi v. G.E. Energy, LLC, and sets up a circuit split that the Supreme Court may be asked to resolve. Continue reading

District Court Enjoins Department of Interior Rule on Hydraulic Fracturing on Federal and Indian Lands

sboxermanFeatured Expert Column – Environmental Law and Policy

by Samuel B. Boxerman, Sidley Austin LLP with Ben Tannen, Sidley Austin LLP

On September 30, 2015, a Wyoming federal judge issued a preliminary injunction prohibiting the U.S. Department of Interior’s Bureau of Land Management (“BLM”) from enforcing its final rule governing hydraulic fracturing on federal and Indian lands pending resolution of the case. Wyoming v. U.S. Dept. of Interior. The decision itself is a major victory for industry, but if adopted elsewhere, the Court’s stated rationale—that the Congress has not authorized federal agencies to regulate hydraulic fracturing unless it involves the use of diesel fuels—could have even more far-reaching benefits for oil and gas development. Continue reading

Litigation Targeting Trans Fat Stayed: A Bump in the Road or Something More?

davidwallacehsfcomLGSMKellyGuest Commentary

by David L. Wallace and Michael R. Kelly, Herbert Smith Freehills LLP*

Since the 1950s, partially hydrogenated vegetable oils (PHOs) have been used to produce all sorts of packaged foods. These ingredients increase food shelf life and flavor stability. They also contain artificial trans fats, which have been linked to various health risks, including cardiovascular disease. Despite these risks, PHOs were until recently “generally recognized as safe” (GRAS) for use as a food ingredient. The tide began to swing two years ago, though, when the Food and Drug Administration (FDA) tentatively proposed to withdraw GRAS status for PHOs “based on current scientific information” about the health risks of trans-fat consumption. It finalized this determination in a June 2015 order, declaring “that there is no longer a consensus among qualified experts that partially hydrogenated oils … are generally recognized as safe for any use in human food.”

Lawyers Running With Regulations

This regulatory action makes PHOs a “food additive” subject to pre-market approval by the FDA. Without FDA approval, foods containing PHOs would be deemed “adulterated” under both federal and state laws. The agency left industry breathing room, however, giving it until June 2018 either to comply or to obtain approval for certain uses of PHOs. But, like time, regulation-chasing plaintiffs’ lawyers wait for no one, and pounced on the agency’s new stance in the name of “consumer protection.” Before the FDA had even finalized its decision on PHOs, they had already installed trans fats as the latest bogeyman on supermarket shelves and the food-litigation landscape—alongside such hated fighting words as “natural,” “healthy,” “freshly baked,” and “handcrafted.”       Continue reading

Eleventh Circuit Has Opportunity in “U.S. v. Clay” to Reshape Prosecutors’ & Courts’ Approach on Criminal Intent

11th CircuitOn Friday, October 2, the U.S. Court of Appeals for the Eleventh Circuit will hear oral arguments in a closely followed criminal health-care fraud case, U.S. v. Clay. Earlier this year, Washington Legal Foundation published a Legal Backgrounder on the case and its broader ramifications, Clay v. United States: When Executives Receive Jail Time for Ordinary Business Decisions.

In Clay, federal prosecutors converted a contract dispute between a medical services provider, WellCare Health Plans, and the State of Florida Agency for Healthcare Administration (AHCA) into a criminal action. The company had interpreted a complex state law regarding the repayment of Medicaid premiums to the state in a manner that was contrary to AHCA’s interpretation. AHCA’s interpretation was not memorialized in a state regulation or guidance document. Despite this lack of guidance, federal prosecutors indicted WellCare and its executives for health care fraud. The company entered into a deferred-prosecution agreement, leaving the executives to fend for themselves. Continue reading

Sixth Circuit Affirms Class-Certification Order Despite Lack of Commonality

Cruz-Alvarez_FFeatured Expert Contributor – Civil Justice/Class Actions

Frank Cruz-Alvarez, Shook, Hardy & Bacon L.L.P. (co-authored with Talia Zucker, Shook, Hardy & Bacon L.L.P.)*

The U.S. Court of Appeals for the Sixth Circuit’s recent decision in Rikos v. The Procter & Gamble Company was a setback to Rule 23 jurisprudence, but as is often the case, there is a silver lining—Judge Deborah Cook’s dissenting opinion.  Judge Cook penned a thoughtful dissent that unravels the analytical shortcomings of the majority’s opinion, and demonstrates the conflict that exists between the majority opinion and the Supreme Court’s Rule 23 jurisprudence.

This lawsuit arose when three consumers (“Plaintiffs”), each residing in different states, purchased the product Align, a probiotic nutritional supplemental designed to promote digestive health, but believed it did not work as advertised. They subsequently brought this action against Procter & Gamble (“P&G”), the manufacturer of Align, claiming violations of various state unfair and deceptive practices because Align did not promote digestive health for anyone. Continue reading

‘Chevron’ Deference Conflicts with the Administrative Procedure Act

faulkFeatured Expert Column − Complex Serial and Mass Tort Litigation

Richard O. Faulk, Hollingsworth LLP*


“It is emphatically the province and duty of the Judicial Department to say what the law is.”
Marbury v. Madison, U.S. 137, 177-78 (1803) (per Marshall, C.J.)

Judicial deference to agency interpretations of statutes and regulations is nothing new—but a trend toward more critical review is emerging. In the October 2014 term of the United States Supreme Court alone, three serious concerns about deferential review were recognized:

  • First, in King v. Burwell, the Court refused to defer to the Internal Revenue Service’s interpretations of the Affordable Care Act—because Congress did not expressly delegate interpretive power regarding this question of “deep economic and political significance” to the IRS, and because the IRS has no special competence in health care issues.
  • Second, in Perez v. Mortgage Bankers Ass’n, members of the Court expressed grave concerns about deference to an agency’s interpretation of vague and ambiguous regulations—especially when the agency itself was responsible for the ambiguities.
  • Finally, Justice Thomas wrote a compelling concurring opinion in Michigan v. EPA, in which he stressed that the Court’s continued allegiance to “Chevron deference”—under which courts defer to agencies’ interpretations of the statutes they are charged to administer—raises “serious” constitutional questions under the “separation of powers” doctrine.

Continue reading

Jay B. Stephens Succeeds Dick Thornburgh as Chairman of WLF Legal Policy Advisory Board

stephensWashington Legal Foundation today named Jay B. Stephens as Chairman of its Legal Policy Advisory Board. Mr. Stephens succeeds The Honorable Dick Thornburgh, who served as Chairman for 18 years. WLF’s Legal Policy Advisory Board includes over forty distinguished professionals from the government, private sector, academic, and public policy legal communities.

Mr. Stephens recently retired from Raytheon Company after serving for nearly 13 years as a member of the company’s senior leadership team. As Senior Vice President, General Counsel, and Corporate Secretary at Raytheon, he led the company’s corporate governance, risk management, and global compliance and ethics programs as well as its legal function, and participated in the company’s operational management and strategic planning.

Prior to joining Raytheon, Mr. Stephens had a distinguished career in the public and private sectors, serving as Associate Attorney General of the United States (2001-2002); United States Attorney for the District of Columbia (1988-1993); Deputy Counsel to the President of the United States (1986-1988); Deputy General Counsel of Honeywell International; and as a partner in the Washington office of a national law firm. In 2014, National Law Journal named him among the top fifty general counsel in America, and in 2015 the New York Stock Exchange Governance Services honored him with its Lifetime Achievement award.

Constance Larcher, WLF’s President and CEO, praised Governor Thornburgh for his nearly two decades of leadership of WLF’s Legal Policy Advisory Board:

We deeply appreciate Dick’s humble guidance, extensive involvement in WLF’s litigation, publishing, and communications programs, and devoted friendship. WLF is honored to have Jay Stephens as Dick’s successor, and we look forward to his direction of the Board and his engagement in WLF’s public-interest mission.

Mr. Stephens noted,

I am delighted to have the opportunity to work with the talented and dedicated team at WLF and to provide leadership to its very capable Advisory Board as together we advance the important public interest mission of WLF.  I look forward to building on Dick Thornburgh’s many significant contributions to the success of the Foundation’s mission of being an advocate for freedom, justice, and free enterprise.