DROPLETS

The U.S. Securities and Exchange Commission has launched a specialized enforcement unit focused exclusively on investigating and pursuing financial reporting and accounting fraud cases against public issuers, aligning with the agency’s stated “back-to-basics” enforcement priority of protecting investors by ensuring the accuracy of public company financial disclosures. In-house counsel should partner with accounting and compliance teams to conduct proactive reviews of internal financial reporting controls, disclosure workflows, and historical accounting judgments to identify and remediate potential gaps ahead of increased investigative activity from the new unit.

In the first half of 2026, Chinese regulators released a joint 2026 work plan targeting misconduct in pharmaceutical procurement, medical services, and related areas, elevating medical data security and investigator-initiated study oversight to standalone enforcement priorities. New binding rules for pharmaceutical sales representatives take effect August 1, 2026, with a public violation disclosure platform already active. A new judicial interpretation lowers criminal bribery thresholds for the life sciences sector to RMB 100,000 for individuals and RMB 200,000 for entities, and creates clearer corporate liability for employee misconduct approved by senior management. Companies should update compliance programs to cover third-party research arrangements, sales rep filing requirements, distributor tax invoice vetting, and medical insurance fund use to mitigate expanded multi-agency enforcement risk.

On August 3, 2026, the California Supreme Court issued a 6-1 ruling in the Gilead Tenofovir Cases, explicitly rejecting the legal theory that drug manufacturers owe a duty of care to patients when deciding whether to develop new drug formulations or update existing products. The decision overturns lower court rulings that had permitted negligence claims against drug makers for failing to innovate, eliminating a high-stakes, novel liability theory that created significant uncertainty for pharmaceutical R&D and product lifecycle planning. In-house counsel for pharma and biotech companies operating in California should update product liability risk assessments and R&D decision documentation practices to reflect the eliminated legal exposure.

A recent Supreme Court decision held that the FTC’s current leadership structure violates separation of powers principles by restricting the president’s authority to remove agency commissioners at will, ending decades of insulation for FTC decision-making from executive branch oversight. The ruling creates immediate uncertainty for pending FTC enforcement actions, active rulemaking proceedings, and future regulatory priorities. In-house counsel for businesses subject to FTC regulation should review all active investigations and compliance obligations, assess how shifting agency leadership and policy direction may impact operations, and revise regulatory risk mitigation strategies to account for less predictable enforcement outcomes.

Treasury has issued final regulations implementing Executive Order 14105, establishing the Outbound Investment Security Program administered by the new Office of Global Transactions within Treasury's Office of Investment Security. The rule, effective January 2, 2025, applies to U.S. persons and reaches covered transactions with persons of a country of concern (China, Hong Kong, and Macau) involving semiconductors and microelectronics, quantum information technologies, and artificial intelligence. It imposes outright prohibitions on specified investments and a notification obligation for others, with expansive definitions that capture entities where more than 50% of key financial metrics are attributable to covered foreign persons. Sophisticated counsel and major-firm clients should expect significant compliance diligence, deal-structuring, and JV-review work because the rule reaches equity, debt, and certain contingent interests, including those involving greenfield, expansion, and joint-venture activity. Watch for subsequent Treasury guidance, covered-technology clarifications, and

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A U.S. District Court for the Eastern District of Texas has issued a nationwide preliminary injunction, effective December 3, 2024, that halts enforcement of the Corporate Transparency Act (CTA). The order suspends the beneficial ownership information (BOI) reporting requirements and stays all compliance deadlines for as long as the injunction remains in effect. This development provides immediate, albeit potentially temporary, relief for millions of companies from a significant new compliance burden. The Financial Crimes Enforcement Network (FinCEN), the agency responsible for implementing the CTA, has announced that it will comply with the court's order. Reporting companies are therefore not currently required to submit BOI reports and will not face penalties for non-compliance while the injunction is active. The Department of Justice, however, filed a notice of appeal on December 5, 2024, making the long-term status of the reporting regime uncertain. Counsel should advise clients to monitor the appeal closely, as the reporting obligations could be reinstated.

Implementing the administration's May 2018 withdrawal from the Joint Comprehensive Plan of Action (JCPOA), the US Treasury's Office of Foreign Assets Control (OFAC) has revoked two key general licenses authorizing certain Iran-related transactions. The revocations, effective June 27, 2018, eliminate General License H, which had permitted foreign entities owned or controlled by US persons to do business with Iran. This materially alters compliance obligations for US multinationals, whose foreign subsidiaries must end all US-jurisdiction-touching Iran activities. OFAC also revoked General License I, which authorized contingent contract negotiations for commercial passenger aircraft sales to Iran. To manage the transition, OFAC issued replacement wind-down licenses. Activities previously authorized under GL-H must conclude by November 4, 2018; aircraft-related negotiations and certain Iranian imports (carpets, foodstuffs) must wind down by August 6, 2018. Sophisticated counsel and clients care because secondary-sanctions exposure, foreign-investment restrictions, and aviation-sector dea

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California lawmakers advanced a narrower version of Senate Bill 690 to the Assembly Appropriations Committee, targeting the surge of California Invasion of Privacy Act (CIPA) claims challenging routine web tracking, analytics, and session-replay technologies. Courts have split on whether CIPA's pen register and trap and trace provisions apply to pixels, SDKs, and similar digital tools, fueling thousands of demands and lawsuits. SB 690 attempts to clarify that ordinary website analytics do not constitute unlawful interception under CIPA, potentially curbing serial-plaintiff litigation. In-house counsel should monitor the bill's progress, audit tracking technologies for compliance, and evaluate pending CIPA exposure in light of the proposed safe harbor. Final language and effective date remain pending Assembly action and gubernatorial signature.

The California Supreme Court resolved a split in state appellate precedent by holding that Code of Civil Procedure section 998 settlement offers may include mutually exclusive alternative sets of terms, provided the offer clearly lays out the available options and at least one alternative is sufficiently certain to permit accurate valuation at the time the offer is made. The ruling reinforces section 998’s core policy of encouraging early settlement by giving offerors greater flexibility to craft tailored, case-specific offers. Defendants may now pair complex, hard-to-value settlement terms with a clear, easily valued lump-sum alternative, while offerees must evaluate all valid alternatives against their expected trial recovery to avoid adverse cost-shifting if they reject a more favorable offer.

On August 3, 2026, Texas Governor Greg Abbott directed state energy regulators to halt the approval of new data center connections to the state's power grid. The directive orders the Public Utility Commission of Texas (PUC) and the Electric Reliability Council of Texas (ERCOT) to conduct a “comprehensive verification and audit” of all data center projects currently in the interconnection queue, effectively pausing their development indefinitely. This sudden move creates significant uncertainty for the rapidly growing data center industry in Texas, a key driver of legal work in project finance, real estate, and energy law. Sophisticated counsel and their clients must now grapple with immediate project delays and the prospect of new, more stringent regulatory hurdles. The action highlights growing concerns about the strain that energy-intensive facilities place on grid stability. Developers and investors should closely monitor the PUC and ERCOT for guidance on the audit's timeline and scope, as its findings will likely shape future requirements for large-load interconnections in the st

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On January 24, 2024, the U.S. Securities and Exchange Commission adopted extensive new rules for special purpose acquisition companies (SPACs) in a split 3-2 vote. The regulations aim to provide SPAC investors with protections more comparable to those in traditional initial public offerings. For law firms and their clients, the rules introduce significant new compliance burdens and liability risks. Key changes include enhanced disclosure requirements concerning SPAC sponsors, conflicts of interest, and potential dilution. The rules also deem the target company in a de-SPAC business combination to be an issuer, creating potential new Securities Act liability. Projections used in de-SPAC transactions may now face heightened scrutiny. Corporate counsel must now navigate a regulatory landscape that substantially narrows the perceived advantages of a SPAC transaction over a traditional IPO. Market participants will closely watch whether the new framework chills SPAC activity, as dissenting SEC commissioners predicted.

Treasury's final rule, effective December 26, 2024, materially expands CFIUS's enforcement toolkit and the financial downside for foreign-investment deal teams. The committee can now issue information requests not only to transaction parties but also to unrelated third parties such as banks, underwriters, and service providers, and can do so even for non-notified transactions, closing a long-standing gap that let non-disclosing deals escape early scrutiny. CFIUS may also impose a minimum three-business-day deadline for parties to respond to mitigation proposals, with limited extensions, compressing the negotiation window during which national-security risk is resolved. Although the alert does not enumerate the new penalty caps in the excerpt provided, it characterizes the increases as significant and signals a clear intent to deter noncompliance with mandatory filings, mitigation agreements, and disclosure obligations. Sophisticated M&A, private-equity, and cross-border finance counsel should brief clients on tightening diligence around TID-target identification, pre-filing risk mapp

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The July 27, 2022 Inflation Reduction Act introduced by Senators Manchin and Schumer would, if enacted, mark the most significant change to the private equity tax landscape since the 2017 Tax Cuts and Jobs Act. The bill lengthens the requisite holding period for carried interest to qualify for long-term capital gain treatment from more than three years to more than five years, with limited exceptions for taxpayers earning under $400,000 of adjusted gross income and for real property trades or businesses (which would face a separate three-year requirement). It also restarts the clock based on when the sponsor substantially acquires the carried interest or the partnership substantially acquires its assets, diverging from current Section 1061 asset-level holding period principles and disrupting common disposal techniques. A corporate alternative minimum tax of 15% would apply to certain corporations. Sophisticated sponsors, LPs, and their counsel should model fund-level economics, review waterfall and distribution mechanics, and track Senate floor action and any conference changes befor

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On June 21, 2024, Treasury issued a long-awaited notice of proposed rulemaking implementing Executive Order 14105, creating the Outbound Investment Security Program. The proposed rule applies to covered transactions by US persons involving covered foreign persons in the PRC (including Hong Kong and Macau) engaged in three sensitive-technology categories: semiconductors and microelectronics, quantum information technologies, and artificial intelligence. Triggered transactions include equity acquisitions, convertible or subordinated debt financing, greenfield investments, and certain joint ventures, plus indirect investments through entities more than 50 percent owned by a covered foreign person. Some transactions require notice to Treasury; others in subsectors deemed most sensitive—particularly certain advanced semiconductor and AI work—are outright prohibited. Sophisticated counsel and clients should map exposure, prepare comment letters, model fund and JV structures, and update CFIUS-style diligence for outbound China-tech exposure. Watch for the final rule, potential grandfatherin

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The U.S. Securities and Exchange Commission has proposed substantial revisions to its proxy rules that would significantly expand public company disclosure obligations. If adopted, the amendments would require companies to analyze and discuss how their overall compensation policies for all employees, not just executives, could materially affect the company's risk profile. The proposals also call for enhanced disclosure concerning the specific qualifications of directors and nominees, the company's board leadership structure, and potential conflicts of interest involving compensation consultants. Additionally, the rules would change the valuation of equity awards in compensation tables to reflect grant-date fair value and introduce a new Form 8-K requirement for timely reporting of shareholder vote results. These changes would impact proxy statements, annual reports, and registration statements. Public companies and their counsel should monitor the proposal's progress and assess how the new requirements could affect their governance and disclosure practices in future proxy seasons.

The Treasury Department's Office of Foreign Assets Control (OFAC) has issued new guidance clarifying the scope of sanctions relief under the Joint Comprehensive Plan of Action (JCPOA). The update addresses key operational questions for U.S. and foreign companies navigating the post-Implementation Day environment. For financial institutions, OFAC confirmed that U.S. banks may maintain correspondent accounts for non-U.S. banks that do business with non-sanctioned Iranian entities, though Iran-related transactions cannot be routed through the U.S. financial system. For multinationals, the guidance clarifies that a U.S. person serving as a director or manager at a foreign company must be 'ring-fenced' from any Iran-related business conducted by that company, and it recommends a blanket recusal policy. OFAC also affirmed that under General License H, a U.S. parent company can adjust its policies to permit a foreign subsidiary to establish a physical presence in Iran. Counsel should review compliance programs, especially recusal policies for U.S. executives, to align with this specific gui

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CFIUS's 2023 Annual Report to Congress, summarized by Duane Morris, shows the interagency committee reviewed 342 covered-transaction notices and declarations, opened inquiries into 60 non-notified transactions, and issued a record number of penalties. The article situates these figures alongside 2024 proposed rules that the authors read as portending expanded CFIUS reach and larger monetary exposure for non-compliance, including in TID U.S. businesses and covered real estate. FIRRMA remains the statutory backbone, with Treasury-led final rules in 2020 imposing mandatory filings for certain foreign-government-linked, 25%-plus investments in critical-technology, critical-infrastructure, or sensitive-data businesses; in March 2024, the Secretary of Agriculture was added to the committee for agricultural transactions. Sophisticated counsel should expect heightened enforcement risk on cross-border M&A and minority investments, renewed attention to non-notified transactions, and evolving compliance expectations. Watch for Treasury's finalization of the 2024 proposed rules, any expansion of

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India’s government has paused all efforts to collect its Minimum Alternate Tax (MAT) from foreign portfolio investors (FPIs), shelving past notices and refraining from issuing new ones. The move provides temporary relief to foreign investors and follows a period of market turmoil, including a record dollar outflow reportedly triggered by the tax department’s retrospective application of the levy. For many FPIs, the sudden tax liability was problematic because the profits from previous years had likely already been distributed to their own underlying investors, making the funds difficult to recover. Sophisticated investors and their counsel care because the pause signals the government is sensitive to investor backlash but also creates a period of uncertainty. The core legal dispute over the tax's applicability remains unresolved. All eyes are now on a special committee, led by Law Commission Chairman A.P. Shah, which was established to review the matter and issue a report. The committee's findings will likely shape the government's next steps, though the issue may ultimately require

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In KSR International Co. v. Teleflex Inc. (April 30, 2007), the Supreme Court unanimously reversed the Federal Circuit, holding that the rigid application of the teaching, suggestion, or motivation (TSM) test was inconsistent with the expansive, flexible approach required by Graham v. John Deere and § 103. Writing for the Court, Justice Kennedy emphasized that combining familiar elements according to known methods likely yields obvious results, and that secondary considerations remain part of the inquiry. BigLaw patent litigators and prosecution counsel should expect the Federal Circuit and district courts to apply a more holistic obviousness analysis going forward, making summary judgment more available to accused infringers and increasing challenges to combination-patent claims. Combined with the Court's companion decision on extraterritorial reach issued the same day, the rulings reset key boundaries of U.S. patent enforceability and warrant review of pending claim charts, prosecution strategies, and pending infringement matters.

As part of its 'Plan Mexico' initiative to capitalize on nearshoring trends, Mexico's government has enacted an executive order creating significant new tax incentives. The order, effective from January 22, 2025, through 2030, is designed to attract new investment and foster workforce development. For sophisticated counsel and clients, these changes are critical for evaluating the financial viability of establishing or expanding manufacturing and supply chain operations in the country. The new framework replaces previous export-focused incentives with broader benefits. Key provisions include the immediate deduction of new fixed assets acquired before September 30, 2030, and additional deductions for employee training expenses. To claim the training benefit, companies must have a collaboration agreement with the Ministry of Public Education. An Evaluation Committee will oversee the application process for these incentives, which are backed by a total authorized budget of approximately $1.5 billion. Counsel should immediately assess client eligibility and the strategic implications for

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In a significant ruling for the venture capital community, the Delaware Court of Chancery has established a framework for evaluating covenants not to sue for fiduciary duty breaches in stockholder agreements. In New Enterprise Associates 14, L.P. v. Rich, Vice Chancellor Laster held that such anti-suit provisions are facially valid but must satisfy a stringent two-part test to be enforceable: the covenant must be both specific in scope and reasonable in its application. This decision is particularly consequential as it interprets a provision from a National Venture Capital Association (NVCA) model agreement, which is widely used by startups and VC investors. The court affirmed that stockholders can tailor fiduciary duties by contract, but it also reinforced Delaware's public policy against the advance exculpation of intentional wrongdoing. Consequently, a covenant will not be enforced if it shields a fiduciary from liability for an intentional breach of duty. The ruling provides critical guidance for drafting these covenants and sets the pleading standards for stockholders seeking to

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On January 23, 2025, the SEC issued Staff Accounting Bulletin 122, formally rescinding SAB 121 and removing its reference from the SEC Staff Accounting Bulletin Series. SAB 121 had forced banks safeguarding customer crypto to record a corresponding liability and tie up regulatory capital, effectively deterring bank custody services. SAB 122 applies to annual periods beginning after December 15, 2024, and may be applied retroactively to prior periods reported after that date. Rescission eliminates the rigid one-to-one asset/liability treatment, though general GAAP principles may still require recognition of a contingent liability, likely on a less burdensome basis. The more durable obstacle, the alert argues, sits with the federal banking regulators: OCC, FRB, and FDIC have issued mixed guidance and the FDIC has used informal supervisory letters directing institutions to pause or not expand crypto activities. A pending FOIA suit by Coinbase seeks those pause letters. Sophisticated counsel should track OCC, Fed, and FDIC follow-on guidance and FOIA-driven disclosures, as well as any Co

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The Corporate Transparency Act (CTA) becomes effective on January 1, 2024, imposing significant new reporting obligations on an estimated 32 million U.S. business entities. Under rules issued by the Financial Crimes Enforcement Network (FinCEN), these "reporting companies" must submit detailed information about their beneficial owners—the individuals who ultimately own or control them. The goal is to combat illicit financial activities. Non-compliance is not a trivial matter; it can result in federal criminal penalties. Sophisticated counsel must advise clients on whether they qualify as a reporting company or fall under one of the numerous, often complex, exemptions. Companies existing before 2024 have until January 1, 2025, to file their initial reports. However, entities formed or first registered during 2024 have a tighter, 90-day deadline from their formation or registration date. For entities created in 2025 or later, this window shrinks to just 30 days. Counsel should immediately begin assessing which client entities are affected and gathering the necessary ownership informati

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On July 28, 2026, the FCC expanded its Covered List on a categorical basis, adding power inverters and 'advanced robotic devices' produced in foreign countries to the list of equipment deemed an unacceptable risk to U.S. national security. The action followed a White House-convened interagency determination and means that new models meeting the FCC's 'foreign-produced' definition will not be eligible for equipment authorization, effectively barring their importation or marketing in the United States. Sophisticated counsel and clients should care because the categorical scope reaches two strategically important supply chains: grid-scale and distributed-energy power inverters (touches utilities, renewables developers, and inverter OEMs) and advanced robotics (touches manufacturers, system integrators, and warehouse/automation buyers). The move is part of a broader pattern of using the FCC's Covered List as a tool of supply-chain and technology protectionism. Concrete next steps to watch include FCC equipment-authorization guidance defining 'foreign-produced' and 'advanced robotic devic

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Virginia has become the second state to enact comprehensive consumer privacy legislation, with Governor Ralph Northam signing the Consumer Data Privacy Act (CDPA) into law on March 2, 2021. The law creates a new set of compliance obligations for businesses that conduct business in Virginia or target its residents and either control or process personal data for at least 100,000 consumers, or derive over 50% of gross revenue from the sale of personal data while controlling or processing data for at least 25,000 consumers. Sophisticated counsel care because the CDPA, while conceptually similar to the California Consumer Privacy Act (CCPA), has key differences. These include a narrower definition of 'sale' (limited to monetary consideration), the absence of a private right of action, and a requirement for opt-in consent to process sensitive data. The law imposes its own requirements, including mandatory data protection assessments for certain activities. Enforcement is vested exclusively with the state attorney general. With an effective date of January 1, 2023, clients have time to asse

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The Securities and Exchange Commission is intensifying its enforcement of whistleblower protection rule 21F-17, recently taking action against companies for language in employment and separation agreements deemed to impede communication with the agency. In a significant expansion of this focus, the SEC settled its first-ever enforcement action on this issue with a privately held company, Monolith Resources, fining it for a provision that required departing employees to waive their rights to monetary awards from government agencies. Corporate counsel should note that the SEC's scrutiny is granular. The agency has also targeted clauses in which employees must represent that they have not filed any complaints against the company, viewing them as unlawful impediments even when the agreement explicitly carves out the right to file a charge with the SEC. Broad definitions of 'confidential information' are also under fire. These enforcement actions demonstrate the SEC’s expansive view of its authority to protect potential whistleblowers. Companies, both public and private, should consider r

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Nasdaq has filed a proposal with the U.S. Securities and Exchange Commission for new listing rules that would require its listed companies to advance board diversity. If approved, the 'comply or explain' framework would mandate that companies have at least one director who self-identifies as female and another who self-identifies as an underrepresented minority or LGBTQ+. Companies failing to meet this standard would not be delisted but would have to publicly explain their reasoning. The rules also call for annual disclosure of board diversity statistics in a standardized matrix format, providing consistent data for investors. This represents a significant move by a major exchange to use its regulatory power to influence corporate governance and respond to increasing investor focus on environmental, social, and governance (ESG) factors. Corporate counsel should note that the 'explain' option may not fully insulate a company from pressure from institutional investors and proxy advisory firms. The proposal is now subject to SEC review and public comment.

Two House- and Senate-pending bills would require CFIUS to review foreign investments in U.S. agriculture, including farmland, layering a federal regime on top of existing FIRRMA real-estate authority. Treasury's November 1, 2024 final rule already expanded CFIUS coverage by adding dozens of military installations to the list of sensitive real-estate geographies, broadening non-notified review reach. Independently, states such as Florida have enacted restrictions on certain foreign nationals acquiring real property, with several of those laws facing constitutional challenges in court. Sophisticated counsel advising cross-border investors, REITs, agribusiness acquirers, and sovereign-wealth funds should map transaction footprints against both the federal installation radius lists and state-level ownership rules before signing. Watch for Senate action on the Protecting American Agriculture from Foreign Adversaries Act and state-court rulings on the constitutionality of the existing ownership bans.

On October 11, 2023, the SEC adopted amendments to Regulation 13D-G that materially accelerate the timeline for public disclosure of large equity stakes. Under the prior regime, an investor crossing the 5% threshold had 10 calendar days to file an initial Schedule 13D and amendments were due only “promptly” after a material change. The new rules cut the initial 13D filing window to five business days and require amendments within two business days, while also reshaping the Schedule 13G schedule for qualified institutional, passive, and exempt investors. The amendments also clarify how derivative securities are counted toward the 5% trigger and revisit the standards for when filers are deemed to be acting as a group. For issuers, activists, and asset managers, the compressed timeline changes the calculus around stake-building, hedging, and group-formation risk, and raises the operational bar for compliance systems, internal approvals, and beneficial-ownership monitoring. Counsel should expect increased early-stage scrutiny of accumulations, more frequent amendment obligations, and ren

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OMB Memorandum M-25-13 directed all federal executive departments and agencies to temporarily pause obligations and disbursements of federal financial assistance, including grants, cooperative agreements, and loans, while agencies reviewed programs for alignment with new executive orders on DEI, foreign aid, NGOs, and climate policy. A separate 52-page memo identified programs subject to review, with broad exceptions clarified by OMB on January 28 covering Pell Grants, student loans, Social Security, Medicare, Medicaid, SNAP, small business funds, Head Start, and rental assistance. District Judge Loren Alikhan issued an administrative stay of the freeze through February 3, after which OMB released a second memorandum on January 29 rescinding M-25-13 entirely and directing questions to agency general counsel. Sophisticated counsel advising recipients of federal funds, universities, NGOs, and contractors should monitor ongoing agency-by-agency review, watch for successor guidance implementing the underlying executive orders, and assess whether disbursement delays during the brief pause

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On December 23, 2024, the Fifth Circuit issued an unpublished decision staying the December 3 nationwide preliminary injunction that had halted enforcement of the Corporate Transparency Act in Texas Top Cop Shop. The stay permits FinCEN to enforce the statute while the Fifth Circuit considers the constitutionality appeal on the merits. FinCEN responded the same evening with narrow filing extensions recognizing that companies lost compliance runway during the injunction period. Reporting companies existing or registered before January 1, 2024 now have until January 13, 2025; entities created between September 4 and December 23, 2024 also face a January 13, 2025 deadline, while those created December 3-23 get an additional 21 days. Disaster-relief recipients should follow whichever deadline is later. Counsel should note that the injunction question is far from settled, additional appellate and Supreme Court action remains possible, and the law's fate for the roughly 32 million in-scope entities could shift again. Clients should immediately restart beneficial ownership information prepa

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The Federal Financial Institutions Examination Council (FFIEC) has proposed the first comprehensive revisions to its Uniform Financial Institutions Rating System (UFIRS), or CAMELS, in 30 years. This marks a significant shift in supervisory philosophy, emphasizing transparency and quantitative metrics. The most critical change is the proposed removal of the “special consideration” historically given to the management component when assigning a bank’s composite rating. This change is intended to create a more balanced assessment, where management is weighted alongside capital adequacy, asset quality, earnings, liquidity, and sensitivity to market risk, rather than being a dispositive factor. The proposal also refines the management component itself, removing certain evaluation factors to focus more sharply on material financial risk management. Financial institutions should assess the impact of a more evenly weighted rating system on their governance and risk frameworks and consider submitting comments on the proposal by the August 17, 2026 deadline.

In a unanimous judgment authored by Justice Scalia, the U.S. Supreme Court adopted a strict territorial reading of Section 10(b) of the Exchange Act, holding the anti-fraud provision reaches only (i) securities listed on a U.S. stock exchange or (ii) purchases or sales of securities effected in the United States. The decision overruled the Second Circuit's long-standing effects and conduct tests and recharacterized the extraterritoriality question as merits-based rather than jurisdictional. Justices Stevens and Breyer concurred, urging retention of the more flexible judicially developed approach. For BigLaw practitioners advising multinational issuers, underwriters and investors, the ruling narrows the universe of foreign-cubed securities fraud claims that can survive dismissal and reshapes pleading strategy in transnational deals, ADR programs, and cross-border investigations. Counsel should expect immediate motions to dismiss pending putative class actions involving non-U.S. listed securities, and re-examination of disclosure and forum-selection practices for offerings with global

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The U.S. Energy Secretary's October 23, 2025 advance notice of proposed rulemaking pushes FERC to assert Federal Power Act jurisdiction over large-load interconnections to the interstate transmission grid—a category historically left to states and individual utilities. The ANOPR sets 14 guiding principles, including a 20 MW threshold, alignment with FERC's seven-factor transmission/distribution test, integrated study of loads with generation interconnection queues, standardized deposits and withdrawal penalties, and treatment of hybrid facilities based on their injection and withdrawal rights. The action responds to grid strain and cost-allocation disputes driven by hyperscale data centers and co-located generation. Counsel advising utilities, RTOs, data-center developers, and co-location sponsors should anticipate a FERC Notice of Proposed Rulemaking, comment opportunities, and likely litigation over federal vs. retail-rate authority. Watch for FERC's timeline, any state commission pushback, and whether the final framework applies retroactively to pending utility and RTO tariff fili

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On March 21, 2025, FinCEN issued an interim final rule (IFR) narrowing the Corporate Transparency Act's BOI regime. The IFR redefines a 'reporting company' to mean only entities formed under foreign law that have registered to do business in a U.S. state or tribal jurisdiction, thereby exempting U.S. domestic entities from BOI reporting. Non-U.S. reporting companies without an exemption must comply under new deadlines: those registered before the IFR's Federal Register publication (expected March 26, 2025) have 30 days to file, and those registering on or after publication have 30 days from notice of effective registration. Importantly, foreign filers need not report U.S. persons as beneficial owners, and U.S. persons are not required to report BOI for such entities. The IFR is interim; FinCEN is accepting comments for 60 days and intends to finalize later in 2025, meaning the rule could change. Pending constitutional challenges to the CTA and potential new challenges to the IFR continue, and Congress may revisit the statutory text. Sophisticated counsel should reassess BOI complianc

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The U.S. Treasury Department has issued proposed regulations that would significantly increase compliance burdens for U.S. disregarded entities wholly owned by foreign persons, such as single-member LLCs. These entities, which often have no U.S. federal income tax reporting requirements under current rules, would be treated as domestic corporations for the limited purposes of reporting and record maintenance.

Sophisticated counsel should care because the rules would require these foreign-owned entities to obtain a U.S. Employer Identification Number (EIN), file an annual Form 5472 information return to report transactions with their foreign owner or related parties, and maintain records to substantiate the filings. This represents a major policy shift toward greater financial transparency, intended to help the IRS enforce U.S. tax laws and comply with international information-sharing agreements.

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Delaware has amended its General Corporation Law (DGCL) in direct response to the Court of Chancery's influential decision in West Palm Beach Firefighters’ Pension Fund v. Moelis & Co. The amendments, effective August 1, 2024, legislatively overrule the court's holding that stockholder agreements cannot restrict board authority under DGCL Section 141(a) unless such limitations are specified in the certificate of incorporation. The Moelis decision had created significant uncertainty for common governance arrangements, particularly in companies with private equity or venture capital investors where stockholder agreements are used to grant investors control over key corporate decisions. New DGCL Section 122(18) now explicitly authorizes corporations to enter into such contracts with stockholders that restrict or require approval for corporate actions. This change restores certainty and validates many existing agreements, as the law applies retroactively. Corporate counsel should review existing stockholder and governance agreements in light of the new statutory authorization and evaluat

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