DROPLETS
Importers, customs brokers, and companies with cross-border supply chains must update compliance protocols, as the new joint DOJ-DHS trade fraud guide treats customs missteps as high-stakes False Claims Act and criminal enforcement targets rather than minor administrative violations.
In July 2026, DOJ and DHS released a joint Resource Guide to Trade Fraud Enforcement via their new Trade Fraud Task Force, which has already secured over $1 billion in civil and criminal recoveries since its 2025 launch. The guide explicitly frames customs misstatements, tariff evasion, misclassification, and false origin claims as potential False Claims Act (FCA) violations, which carry treble damages, statutory penalties, and qui tam whistleblower risk in addition to traditional customs penalties. It also extends enforcement liability across the supply chain to brokers, distributors, and retailers that benefit from improperly imported goods. Importers should test existing diligence and documentation practices against the FCA’s broad 'knowing' standard, retain all import-related records for the required 5-year period, and treat customs filings as evidentiary records rather than administrative formalities.
Businesses with Russian exposure, crypto operations, or cross-border trade in restricted goods must update compliance programs to meet new EU sanctions that expand restrictions to third-country entities and add 218 new sanctioned parties.
On July 23, 2026, the EU Council adopted its 21st Russian sanctions package, the largest single batch of new designations in four years, adding 218 sanctioned parties (48 individuals, 170 entities) including 94 financial institutions. The package introduces new crypto restrictions banning Russian nationals from owning or controlling EU crypto businesses, extending transaction bans to 14 third-country crypto platforms, and creating a framework to ban transactions with crypto providers in jurisdictions that undermine sanctions. It also adds new export bans on dual-use goods including nickel alloys and UAV components, import bans on base metal ores and car parts, and expands transaction bans to 33 additional Russian banks and non-Russian circumvention entities. Companies with Russian exposure should refresh sanctions screening, counterparty diligence, and contract reviews, noting a transition period through October 25, 2026 for pre-July 24 import contracts.
Policyholders with excess coverage in California can now pursue declaratory and bad faith actions against excess carriers before underlying limits are exhausted.
In Fox Paine & Company, LLC, the California Supreme Court ruled on July 27, 2026, that policyholders are not required to exhaust all underlying insurance before seeking declaratory relief or asserting bad faith claims against excess insurers. The decision departs from the traditional exhaustion rule and recognizes that excess carriers have distinct duties that can be triggered independently. For policyholders, this expands leverage in negotiating with excess carriers and creates an earlier pathway to resolve coverage disputes. For insurers, it raises exposure to bad faith liability before underlying limits are paid and may accelerate settlement pressure. In-house counsel should review excess tower structures, reservation-of-rights communications, and current coverage disputes to assess whether early declaratory or bad faith actions are now viable.
Data center operators, energy developers, and tech firms with planned Texas data center projects must track the pause, which freezes pending grid connection requests and will impose new grid capacity review requirements.
The Electric Reliability Council of Texas (ERCOT) has implemented an open-ended pause on all new and pending grid connection requests for data centers, citing unmanageable strain on the state’s standalone power grid from rapidly expanding data center power demand. No end date for the pause has been set, as ERCOT develops new regulatory rules to assess the grid impact of large data center loads before approving connections. Affected parties should audit the status of all pending connection requests, participate in ERCOT’s upcoming rulemaking process, and revise project timelines and budget projections to account for potential extended delays in securing grid access.
In-house counsel overseeing UK workforces must track upcoming late 2026 Employment Rights Act 2025 trade union reforms that will overhaul statutory recognition and industrial relations obligations for their employers.
The UK’s Employment Rights Act 2025, the most significant overhaul of industrial relations rules in decades, saw initial trade union reforms take effect in February and April 2026, including streamlined processes for statutory union recognition. Additional major changes are scheduled to take effect in August and October 2026. In-house counsel with UK-based workforces should review these upcoming rule changes now to assess impacts on union engagement processes, workplace consultation requirements, and operational workflows, and update internal policies and compliance protocols ahead of effective dates to mitigate non-compliance risk.
Derivatives market participants including exchanges, clearinghouses, and FCMs must track and comment on evolving CFTC 24/7 trading rules, as pending requirements will set binding operational and compliance standards for continuous operations.
Over mid-2026, the CFTC released a non-binding staff advisory for entities exploring 24/7 derivatives operations, a formal request for comment on 24/7 energy futures and perpetual commodity contracts, and stayed a self-certified 24/7 crude oil futures filing to review compliance with DCM core principles. The advisory outlines operational guardrails for trading platforms, clearinghouses, and FCMs, including requirements for continuous manipulation surveillance, selection of appropriate weekend collateral call models, and increased residual interest holdings for FCMs to avoid customer fund segregation violations. The CFTC extended the RFC comment deadline to August 26, 2026, and is seeking input on off-peak pricing reliability, margin design, and speculative position limit applicability. Affected market participants should assess product suitability for 24/7 trading, review the advisory’s compliance expectations, and submit comments on the RFC if they have relevant operational or regulatory concerns.
Businesses with Russian exposure, crypto operations, or cross-border trade in restricted goods must update compliance programs to meet new EU sanctions that expand restrictions to third-country entities and add 218 new sanctioned parties.
On July 23, 2026, the EU Council adopted its 21st Russian sanctions package, the largest single batch of new designations in four years, adding 218 sanctioned parties (48 individuals, 170 entities) including 94 financial institutions. The package introduces new crypto restrictions banning Russian nationals from owning or controlling EU crypto businesses, extending transaction bans to 14 third-country crypto platforms, and creating a framework to ban transactions with crypto providers in jurisdictions that undermine sanctions. It also adds new export bans on dual-use goods including nickel alloys and UAV components, import bans on base metal ores and car parts, and expands transaction bans to 33 additional Russian banks and non-Russian circumvention entities. Companies with Russian exposure should refresh sanctions screening, counterparty diligence, and contract reviews, noting a transition period through October 25, 2026 for pre-July 24 import contracts.
In-house counsel overseeing UK workforces must track upcoming late 2026 Employment Rights Act 2025 trade union reforms that will overhaul statutory recognition and industrial relations obligations for their employers.
The UK’s Employment Rights Act 2025, the most significant overhaul of industrial relations rules in decades, saw initial trade union reforms take effect in February and April 2026, including streamlined processes for statutory union recognition. Additional major changes are scheduled to take effect in August and October 2026. In-house counsel with UK-based workforces should review these upcoming rule changes now to assess impacts on union engagement processes, workplace consultation requirements, and operational workflows, and update internal policies and compliance protocols ahead of effective dates to mitigate non-compliance risk.
Data center operators, energy developers, and tech firms with planned Texas data center projects must track the pause, which freezes pending grid connection requests and will impose new grid capacity review requirements.
The Electric Reliability Council of Texas (ERCOT) has implemented an open-ended pause on all new and pending grid connection requests for data centers, citing unmanageable strain on the state’s standalone power grid from rapidly expanding data center power demand. No end date for the pause has been set, as ERCOT develops new regulatory rules to assess the grid impact of large data center loads before approving connections. Affected parties should audit the status of all pending connection requests, participate in ERCOT’s upcoming rulemaking process, and revise project timelines and budget projections to account for potential extended delays in securing grid access.
Derivatives market participants including exchanges, clearinghouses, and FCMs must track and comment on evolving CFTC 24/7 trading rules, as pending requirements will set binding operational and compliance standards for continuous operations.
Over mid-2026, the CFTC released a non-binding staff advisory for entities exploring 24/7 derivatives operations, a formal request for comment on 24/7 energy futures and perpetual commodity contracts, and stayed a self-certified 24/7 crude oil futures filing to review compliance with DCM core principles. The advisory outlines operational guardrails for trading platforms, clearinghouses, and FCMs, including requirements for continuous manipulation surveillance, selection of appropriate weekend collateral call models, and increased residual interest holdings for FCMs to avoid customer fund segregation violations. The CFTC extended the RFC comment deadline to August 26, 2026, and is seeking input on off-peak pricing reliability, margin design, and speculative position limit applicability. Affected market participants should assess product suitability for 24/7 trading, review the advisory’s compliance expectations, and submit comments on the RFC if they have relevant operational or regulatory concerns.
Policyholders with excess coverage in California can now pursue declaratory and bad faith actions against excess carriers before underlying limits are exhausted.
In Fox Paine & Company, LLC, the California Supreme Court ruled on July 27, 2026, that policyholders are not required to exhaust all underlying insurance before seeking declaratory relief or asserting bad faith claims against excess insurers. The decision departs from the traditional exhaustion rule and recognizes that excess carriers have distinct duties that can be triggered independently. For policyholders, this expands leverage in negotiating with excess carriers and creates an earlier pathway to resolve coverage disputes. For insurers, it raises exposure to bad faith liability before underlying limits are paid and may accelerate settlement pressure. In-house counsel should review excess tower structures, reservation-of-rights communications, and current coverage disputes to assess whether early declaratory or bad faith actions are now viable.
Importers, customs brokers, and companies with cross-border supply chains must update compliance protocols, as the new joint DOJ-DHS trade fraud guide treats customs missteps as high-stakes False Claims Act and criminal enforcement targets rather than minor administrative violations.
In July 2026, DOJ and DHS released a joint Resource Guide to Trade Fraud Enforcement via their new Trade Fraud Task Force, which has already secured over $1 billion in civil and criminal recoveries since its 2025 launch. The guide explicitly frames customs misstatements, tariff evasion, misclassification, and false origin claims as potential False Claims Act (FCA) violations, which carry treble damages, statutory penalties, and qui tam whistleblower risk in addition to traditional customs penalties. It also extends enforcement liability across the supply chain to brokers, distributors, and retailers that benefit from improperly imported goods. Importers should test existing diligence and documentation practices against the FCA’s broad 'knowing' standard, retain all import-related records for the required 5-year period, and treat customs filings as evidentiary records rather than administrative formalities.
Businesses with Russian exposure, crypto operations, or cross-border trade in restricted goods must update compliance programs to meet new EU sanctions that expand restrictions to third-country entities and add 218 new sanctioned parties.
On July 23, 2026, the EU Council adopted its 21st Russian sanctions package, the largest single batch of new designations in four years, adding 218 sanctioned parties (48 individuals, 170 entities) including 94 financial institutions. The package introduces new crypto restrictions banning Russian nationals from owning or controlling EU crypto businesses, extending transaction bans to 14 third-country crypto platforms, and creating a framework to ban transactions with crypto providers in jurisdictions that undermine sanctions. It also adds new export bans on dual-use goods including nickel alloys and UAV components, import bans on base metal ores and car parts, and expands transaction bans to 33 additional Russian banks and non-Russian circumvention entities. Companies with Russian exposure should refresh sanctions screening, counterparty diligence, and contract reviews, noting a transition period through October 25, 2026 for pre-July 24 import contracts.
Grade 3 — worth a glance, not the full analysis.
- Big Pharma's M&A Pivot: Why Acquisitions Are Replacing Internal R&D
In-house counsel at pharma targets and acquirers must prepare for a sustained wave of biotech acquisitions as pipeline pressures reshape deal strategy.
- August 2026 Securities Enforcement Developments Digest
Public company in-house counsel and securities compliance teams must review this update to stay current on evolving SEC enforcement priorities and emerging compliance risks.
- Practical Guidance for Lawful, Dignified Employee Terminations
In-house counsel and HR leaders overseeing employee terminations must implement compliant, empathetic logistical processes to avoid costly legal liability and reputational harm for their employers.
- TransDigm Group Enters $1.066B Agreement to Acquire Aerospace Supplier Prince & Izant
In-house counsel for aerospace and defense component manufacturers must track this $1.066 billion sector consolidation to assess competitive shifts and refine M&A targeting strategies.
- NAD Clarifies Substantiating #1 Brand Marketing Claims
In-house counsel for consumer product companies using #1 brand marketing claims must review their substantiation and disclosure practices, as recent NAD rulings impose updated requirements for these common promotional claims.