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• California End-of-Session Report

  California lawmakers wrapped up the 2023 session last Thursday night. With over 2,600 bills introduced this session, hundreds still await the governor’s signature. Gov. Gavin Newsom has a deadline of Oct. 14 to sign or veto the remaining measures on his desk. Below is a compilation of important measures from this session, including passed and pending bills along with stalled and would-be bills that may hint at future policy priorities. Please see full Alert below for more information.

• TNFD Publishes Finalized Recommendations for Nature Related Disclosures

  On September 18, 2023, the Taskforce on Nature-related Financial Disclosures (TNFD) published recommendations for organizations’ assessment, management, and disclosure of nature-related issues (the Recommendations). These recommendations were the result of a two-year engagement process, featuring several beta versions to receive and process commentary from a range of stakeholders. The process builds on several years of growing attention to the fundamental role of nature — including the 2022 Global Biodiversity Framework adopted that nearly 200 countries adopted in a Paris Agreement-type moment for nature. Please see full Alert below for more information.

• This Week’s Climate Policy Update - September 2023 #2

  Good afternoon! This is Akin’s newsletter on climate change policy and regulatory developments, providing information on major climate policy headlines from the past week and forthcoming climate-related events and hearings... Please see full publication below for more information.

• SEC Current Reporting Requirements for Private Funds Become Effective in December

  Key Takeaways - Following the SEC’s adoption, earlier this year, of changes to Form PF, large hedge fund advisers will face, for the first time, a requirement to report certain events to the SEC within 72 hours. Private equity fund advisers will be required to report additional information on Form PF and to file a report within 60 days following any fiscal quarter in which certain events occur. Please see full Insight below for more information.

• California employment legislation on the horizon: A preview of 2024

  The California Legislature had until September 14, 2023, to pass bills in the current Legislative Session before these bills are sent to Governor Newsom to either sign, approve without signing, or veto each bill by October 14, 2023. More than 2,600 new bills were introduced, the largest quantity in over a decade. Several key bills relate specifically to employment law, including expansion of paid sick leave, CalWARN notice requirements, remote workers’ rights, and wage theft. Unless otherwise noted, bills that become law will presumably take effect January 1, 2024. Please see full Publication below for more information.

• Picking Plan Providers Because They’re Cheap Is An Awful Idea

  My wife and I love a good bargain. We both know that any price ending at 97 cents at Costco is a discount. A lot of our vacations around the country include visiting different Costcos to see the variety of items and the regular items on sale or clearance. My wife and I are excellent shoppers because we are savvy shoppers. We like a good bargain and it’s about value, getting something in quality that is on sale. Why buy something at retail price, when you can get it in a few weeks at 30% less? As a plan sponsor, you have a fiduciary responsibility to find a bargain when it comes to picking a plan provider, but you may increase your potential liability by picking providers just because they are cheap. This article is about why you shouldn’t pick a plan provider just based on them offering a low price.

• California Court Adopts the Caremark Standard for Oversight Claims

  The decision articulates the standard for plaintiffs asserting derivative claims based on an alleged failure of oversight by directors and officers of California companies. Nearly three decades ago in the seminal case In re Caremark International Inc. Derivative Litigation, the Delaware Court of Chancery set forth a test to determine whether a director failed to “exercise reasonable oversight.” The court concluded that a director could be held liable for such claims only where a plaintiff could establish a director’s “lack of good faith as evidenced by sustained or systematic failure” of oversight. These director oversight claims became broadly known as “Caremark claims.” As Caremark case law continued to develop, most plaintiffs attempting to meet this high standard did not survive a motion to dismiss, though in recent years Delaware courts have denied dismissal in a handful of cases. Please see full Alert below for more information.

• Holland & Knight Health Dose: September 19, 2023

  Holland & Knight Health Dose is an in-depth weekly dose of legislative and regulatory insights to keep stakeholders abreast of happenings in Washington, D.C., impacting the health sector. Please see full Publication below for more information.

• Looking Ahead to 2024: A Guide for D&O Insurance Renewals [Report]

  The public company D&O insurance market of late has been a roller-coaster ride for all participants—and the dramatic changes over the last five years, which we’ve documented in previous Looking Ahead Guides, continued into 2023. Woodruff Sawyer data shows that in the second half of 2021, 71% of public companies renewing the same year-over-year program experienced a price increase. A year later, that figure completely reversed, with 87% of public companies achieving a decrease in total cost on their renewal program. The soft market trend accelerated into 2023, with 91% of Woodruff Sawyer public company D&O clients renewing with cost decreases in the first half of 2023. Please see full Publication below for more information.

• 2023 ERISA Welfare Plan Automatic Participant Disclosures Checklist

  ERISA requires plan sponsors to distribute SPDs to inform participants of their benefits, rights, and obligations under the plan and describe how the plan operates. Department of Labor (DOL) regulations (available here) prescribe an extensive list of contents that must be included in an SPD. Changes to the SPD are communicated to participants either through a summary of material modifications (SMM) or the issuance of an updated SPD. Please see full Checklist below for more information.

Featured documents

• Are MLM distributorships securities under Texas state law?

  The Texas Court of Civil Appeals held that the Koscot Distributorships were not securities under state law. The court specifically declined to follow other states in interpreting Koscot distributorships as securities. The court felt that because potentially significant efforts on the part of the...

• Is the Koscot sales program a security under current federal law?

  The District court held that Koscot was not a security under the law of the circuit. The court felt compelled to follow earlier circuit precedent in deciding that profits must come "solely" from the efforts of others for an investment program to be considered a security. While other circuits had...

• Connecticut v. Bull Investment Group

  The Superior Court was asked to decide if the sales of a coupon book distributorship, which authorized the sale of similar distributorships to others, violated Connecticut statutes prohibiting the sale of rights or privileges with payment to the purchaser upon the procurement of additional...

• Did the respondents commit fraud and violate state anti-pyramid statutes in the promotion of a pyramid investment program?

  The Missouri Court of Appeals held that while no fraud was involved, Wahl had violated state anti-pyramid statutes. No fraud was present because the materials used to promote the scheme clearly indicated its pyramid nature without deceptive tactics. However, because the program sold "other property,...

• Fahner v. Walsh , 122 Ill. App.3d 481 (1984)

  The Illinois Appellate Court determine that the proper measure of resitutionary damages is the amount of profit made by the liable individual, and anyone who can show that they lost money as a result of the liable individual's conduct should be eligible to claim a portion of the restitution....

• Illinois v. Unimax

  The Court of Appeals held that Unimax's program violated that state pyramid statute. Marketers received a percentage of the monthly dues of those subscribers in their downline. A marketer was required to recruit subscribers and all were encouraged to become marketers, and subscribers in order to...

• Can a bank be held liable for negligence in connection with an illegal pyramid scheme operated by one of its depositors?

  The Louisiana Court of Appeals was asked if a bank could be held liable for negligence in connection with an illegal pyramid scheme operated by one of its depositors. The case and case summary are also available at: http://www.mlmlegal.com/legal-cases/Kueber_v_Martin.php ...

• Under what circumstances may a defendant in a suit resist production of documents?

  The District Court held that documents that are not unduly burdensome to produce and respond to appropriately tailored document requests must be produced. Omnitrition had responded to the plaintiff's document requests with general complaints that compliance would be unduly burdensome. The District...

• What is the proper method of accounting the amount of loss by victims of a Ponzi scheme?

  The Court of Appeals held that the calculation of loss should be accomplished by adding up the amount of money lost by victims of the scheme, the "loss to losing victims method." The Defendant argued that a "net loss" method should be used that offsets the total loss with the profits earned by...

• Is willful intent necessary to violate the fraud provisions of the state securities act?

  The Nebraska Supreme Court held that it was necessary to prove willful intent to be found guilty under the state securities statutes, but willful intent was not the same as scienter, or an evil motive. Irons managed a pure pyramid program where participants gave "gifts" to those on the list above...