Minding Your Business

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

Latest Attack on the Affordable Care Act Soundly Defeated: “The Government should honor its obligations.”

President Obama’s Affordable Care Act has survived yet another challenge in the federal courts. In a resounding 8-1 decision this Monday, April 27, 2020, the U.S. Supreme Court ruled that health insurance companies who suffered losses entering the new marketplaces established by the Affordable Care Act (“ACA”) were entitled to compensation for those losses. Continue Reading

Corporate Caution during COVID-19

The COVID-19 pandemic has brought great economic uncertainty and significant market volatility, creating an environment where investors that are trying to assess the financial impact of the virus are looking to glean any insight they can from a company’s disclosures and are hanging on every statement made by company leaders. This environment of heightened investor focus has, not surprisingly, increased the legal risks that companies, their officers, and their directors face when informing the market about the impact of COVID-19. The coming months are likely to see increased activity from both the SEC Enforcement Division and from plaintiffs’ firms bringing shareholder suits challenging overly optimistic disclosures companies make about their capacity to manage the challenges presented by the pandemic. Consequently, disclosures concerning the business and financial risks to a company posed by COVID-19 must be made with the utmost prudence and caution to limit a company’s exposure to actions brought by the SEC Enforcement Division or shareholder suits. Continue Reading

A Spartan Approach to Price Gouging in Michigan

Price gouging complaints around the country have been skyrocketing and Michigan is no exception. Between March 5, 2019, and April 14, 2019, Michigan had 80 price gouging complaints. During the same period in 2020, Michigan received 3,541 complaints – an increase of 4,326 percent. Michigan has been under a state of emergency since March 10, 2020, which remains in effect indefinitely. Continue Reading

Divided Supreme Court Rules that State Jury Verdicts for Serious Crimes Must Be Unanimous

On April 20, 2020, the Supreme Court held in a 6-3 decision that the Sixth Amendment requires a unanimous jury verdict to convict a defendant of a serious offense in state courts. In so holding, the Court not only paved the way for potentially hundreds of defendants convicted by divided juries, like petitioner Evangelisto Ramos, to obtain new trials, but also effectively overturned its prior holding in Apodaca v. Oregon. Thus, the potential impact of Ramos v. Louisiana extends far beyond issues of criminal procedure, as the justices’ spirited debate over when and whether to overturn precedent took center stage and illustrated deep divisions within the Court. Continue Reading

Price Gouging Takedowns – The Online Platforms Have a Say

Over the past month, state enforcers have declared a war on price gouging, but some of the most effective enforcers have not been the states. Online platforms and other large retailers have taken extraordinary steps to restrict price gouging, and their monitoring has already led to hundreds of thousands of items pulled from e-commerce websites. With entire countries engaging in social distancing, e-commerce has become de-facto commerce for many, and this dramatic and sudden shift gives online sellers enormous influence on price gouging enforcement.

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Price Gouging Laws and Covid-19: What Supply Chain Businesses Should Know

Due to the unprecedented length of the current COVID-19 emergency, price gouging laws that once focused solely on retail prices, now are being applied to participants throughout the entire supply chain. At the beginning of the COVID-19 emergency, state enforcers focused on increases in retail prices to consumers. However, enforcers now are opening investigations and taking enforcement actions throughout the upstream supply chain for covered products and services. Several state Governors also recently have issued Executive Orders that have expanded the scope of their state’s price gouging laws to national producers and distributors. All entities in the supply chain need to consider a nationwide compliance strategy – to comply with the price gouging laws of approximately 34 states and territories that have widely varying requirements. Best practices can include conducting an internal assessment with the help of in-house or outside counsel (i) to determine their scope of possible covered products, (ii) to assess which state’s laws that may be implicated, (iii) to document baseline pricing, pricing movements and the bases for those movements, and (iv) to put measures in place to provide business managers with the knowledge they need to stay compliant. The article discusses these and related issues that arise for sellers at all levels of the supply chain during the COVID-19 state of emergency.

Read the full Bloomberg Law article here.

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Visit Proskauer on Price Gouging for antitrust insights on Covid-19.

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Proskauer’s cross-disciplinary, cross-jurisdictional Coronavirus Response Team is focused on supporting and addressing client concerns. Visit our Coronavirus Resource Center for guidance on risk management measures, practical steps businesses can take and resources to help manage ongoing operations.

Don’t Mess With Texas: Price Gouging in the Lone Star State

When it comes to price gouging in the Lone Star State, Attorney General Ken Paxton is sending a message: don’t mess with Texas. On March 26, 2020, AG Paxton accused Auctions Unlimited, a Texas auctioneer, of price gouging disinfectant wipes, hand soaps, and 750,000 N95 respirator masks. Bidding for just 16 N95 respirator masks went as high as $180 – despite the owner receiving warnings from both AG Paxton and local police – before Texas authorities intervened and stopped the auction. The lawsuit seeks civil penalties of no more than $10,000 per violation, and $250,000 in the event the deception impacted anyone over 65 years of age. Continue Reading

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