Minding Your Business

Proskauer’s perspective on developments and trends in commercial litigation.

N.Y. Court of Appeals: No Difference Between “Private” and “Public” Posts in Discovery

Those who thought designating social media posts as “private” would be sufficient to shield them from outsiders—including opposing parties in litigation—had better think again. On February 13, 2018, the New York Court of Appeals, New York’s highest court, unanimously held that the rules generally applicable to discovery in civil actions are just as applicable to “private” social media posts, and that they are therefore subject to disclosure if they are “reasonably calculated to contain evidence ‘material and necessary’ to the litigation.”  Forman v. Henkin, New York State Court of Appeals, No. 1 (quoting N.Y. C.P.L.R. 3101(a)). Continue Reading

Deceptive Discovery: Second Circuit Affirms Sanctions for Mishandling of Discoverable Data

Late last month, in Klipsch Grp., Inc. v. ePRO E-Commerce Ltd., the Second Circuit affirmed a $2.7 million sanctions award against defendant ePRO after repeated instances of discovery misconduct. Finding that the district court’s award properly reflected the additional costs plaintiff Klipsch Group Inc. was forced to bear due to ePRO’s actions, the Second Circuit disagreed with ePRO that the sanctions were impermissibly punitive and disproportionate. In an era of increasingly complex digital discovery, this case serves as both a sword and a shield: it protects litigants who pursue corrective discovery efforts to remedy an opponent’s willful mishandling of discoverable information, and it punishes litigants who flout their duties to maintain and disclose relevant information. Continue Reading

Copyright in the Digital Age: Cisco v. Arista and the Scènes à Faire Doctrine

Imagine producing a classic Western without cowboys, saloons, or standoffs. This seems almost inconceivable because these elements are deeply integral to the genre – so much so, in fact, that they are essentially necessary for the creation of such works. Copyright law recognizes and accounts for this, by denying copyright protection to such elements under the “scènes à faire” doctrine. “Scènes à faire” literally means “scenes that must be done.” This doctrine traditionally has been applied in the context of literature and film, to keep classic tropes free for use by artists looking to create works in such genres. The Federal Circuit will soon decide, in Cisco Systems v. Arista, whether the scènes à faire doctrine can also be applied in the context of computer programming, to deny copyright protection for software commands that have become commonplace within the field. Continue Reading

Florida’s Fiduciary Lawyer-Client Privilege Adopted by the Florida Supreme Court

Last week, the Florida Supreme Court adopted section 90.5021, Fla. Stat. – Florida’s fiduciary lawyer-client privilege – to the extent it is procedural and held that the decision is retroactive to the Florida legislature’s enactment of the statute in 2011.

The statute provides for application of the lawyer-client privilege when that client is a fiduciary, such as a trustee, personal representative or executor, or guardian. Continue Reading

FTC Announces 2018 Thresholds Under HSR Act and Clayton Act

On January 26, 2018, the Federal Trade Commission announced revisions to HSR Act and Clayton Act Section 8 thresholds, which are indexed annually to account for inflation. We have identified the adjustments that are likely to be the most relevant to our clients, and reiterate several important practice tips.

The Hart-Scott-Rodino Antitrust Improvements Act of 1976, commonly known as the HSR Act, requires parties to certain transactions to notify the Federal Trade Commission and Department of Justice, and to observe a waiting period prior to completing the transaction. The HSR Act enables antitrust regulators to review transactions, investigate and address potential competitive concerns prior to completion, and carries monetary penalties for failure to comply – presently set at $40,654 per day.

Section 8 of the Clayton Act prohibits certain overlaps in officers or directors between competing companies to guard against anti-competitive coordination and information exchanges that can arise from simultaneous board membership. Thus, as a general rule a person cannot serve on the boards of two competing companies.

Read the full text of this alert.

Supreme Court Takes its Toll: Holds that Statute of Limitations for State Claims Stops While in Federal Court

On January 22, 2017, the U.S. Supreme Court issued its first 5-4 merits decision of the term in Artis v. District of Columbia. In this opinion, the Court held that bringing state claims in federal court stops the clock on the statute of limitations for those claims.

Under 28 U.S.C. § 1367, federal courts may exercise supplemental jurisdiction over state law claims that arise from the same case or controversy presented in the federal lawsuit. If the federal court later dismisses the federal claims that independently qualify for federal jurisdiction, however, then the court will also ordinarily dismiss the state claims that it had supplemental jurisdiction over as well. As such, 28 U.S.C. § 1367(d) contains a tolling mechanism providing that the “period of limitations for” refiling a dismissed state claim in state court “shall be tolled while the claim is pending [in federal court] and for a period of 30 days after it is dismissed unless State law provides for a longer tolling period.” The Artis opinion dictates how this tolling mechanism operates. Continue Reading

A Shot in the Arm: Second Circuit Holds Flu Shot Text Messages Didn’t Violate TCPA

Earlier this month, the Second Circuit ruled that Mount Sinai Health System did not violate the Telephone Consumer Protection Act (TCPA) when it sent automated flu shot text message reminders to patients. The three-judge panel in Latner v. Mount Sinai Health Systems, Inc. affirmed the dismissal of the putative class action, finding that the lead plaintiff, Daniel Latner, had consented to receiving the messages.  As companies in the healthcare industry and beyond increasingly rely on automated communication systems, this case highlights the consumer privacy implications of using mass text messages to contact patients and consumers. Continue Reading

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