DROPLETS

California’s new law, SB 574, is the first state legislation specifically targeting attorneys’ use of generative AI. It does not ban the technology but imposes limits on certain applications, such as creating documents that could be mistaken for a lawyer’s true opinion, and requires lawyers to clearly disclose when they’re utilizing AI. The statute also mandates record‑keeping and training for legal professionals to ensure compliance. While the ban is not absolute, the guardrails are intended to protect clients from misinformation and preserve ethical standards during a period of rapid AI deployment. Firms are advised to review the new requirements and update internal policies accordingly. The measure sets a potential precedent that other states may emulate, and the practical ramifications could reshape how big‑law teams integrate AI into service delivery.

On October 7, 2026, the SEC issued a report of investigation under Section 21(a) of the Securities Exchange Act of 1934 addressing whether members of a climate-focused investor coalition — identified in the reporting only as beginning "Climate Action" — constituted a Section 13(d) "group," and the related eligibility consequences for Schedule 13G filings. Section 21(a) reports are rare, and are sometimes used to put an interpretive position on the record outside rulemaking or adjudication — unusually durable guidance for anyone counting beneficial ownership.

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In two late-September 2026 opinions, the U.S. District Court for the District of Columbia enforced four ICSID awards now held by assignee Blasket Renewable Investments against Spain (Eurus Energy Holdings v. Spain, No. 25-cv-1842; Blasket v. Spain, No. 25-cv-1756). The court held that ICSID awards carry full faith and credit under 22 U.S.C. § 1650a, and that the Blinder collateral-attack exception does not reach Spain's contention that intra-EU awards violate EU law or amount to unlawful state aid. Comity, foreign sovereign compulsion and act of state all failed: enforcing an award neither applies U.S. regulatory law to extraterritorial conduct nor invalidates EU Commission decisions.

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The European Union has recently broadened its Russia sanctions blacklist, adding over 40 non‑defence entities—including manufacturers, service providers and tech firms—to the list of sanctioned actors. Unlike earlier expansions that mostly targeted defence‑related companies, the new designations encompass a wider range of sectors, indicating a more sweeping approach to isolating the Russian economy. Firms with direct or indirect links to these entities must rapidly review their supply chains, partnership agreements, and financial transactions to prevent inadvertent sanctions violations. The EU’s updated rules also introduce stricter reporting requirements for certain third‑party transactions in the designated sectors, which could raise audit and legal costs. Compliance teams should map exposure, establish monitoring protocols, and consider alternative sourcing or joint‑venture arrangements that align with the expanded blacklist. The EU is monitoring the impact of these measures and may adjust restrictions as geopolitical developments unfold, so keeping clients informed of future dire

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California’s newly signed AI legislation—SB 947, AB 1883, and SB 951—creates a stringent framework for employer use of artificial intelligence. Beginning July 1, 2027, no employer may rely solely on an automated decision system to discipline or terminate an employee; if an ADS is used, a human must corroborate and provide a post‑use notice. From Jan 1, 2027, employers under the WARN Act must disclose layoffs or relocations that are caused in whole or in substantial part by AI, listing the technology type and affected workforce. AB 1883 bars the collection of neural data or emotional inference during workplace surveillance, with civil penalties of $500 per violation. Key definitions—such as “disciplinary decision” and “in substantial part”—remain vague, so firms should document internal review processes, update layoff notice templates, and monitor enforcement guidance. These rules will reshape human resource practices across California, affecting major‑firm clients nationwide.

On October 14, 2026 the Office of the Comptroller of the Currency released a supervisory review of debanking activities at the nine largest national banks it oversees. The report found that several large institutions had closed or restricted business and consumer accounts on the basis of customers’ constitutionally protected characteristics. In response, the Consumer Financial Protection Bureau announced a new initiative aimed at addressing OCC‑uncovered debanking and to ensure that banks’ practices comply with the Equal Credit Opportunity Act and related privacy and discrimination provisions.

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In a move that underscores a renewed focus on price‑discrimination enforcement, the Federal Trade Commission announced it had reached a settlement with Southern Glazer’s, a major liquor distributor alleged to have imposed discriminatory pricing on competing resellers. The settlement follows the agency’s decision to close a parallel investigation into Gildan Holdings, citing insufficient evidence of wrongdoing. By invoking the Robinson‑Patman Act—a statute originally aimed at preventing sellers of identical goods from charging different prices to different buyers—the FTC demonstrates a willingness to apply older competition provisions to contemporary distribution practices. The outcome is significant for firms representing vendors and resellers in the consumer‑goods and wholesale sectors, as it illustrates the FTC’s readiness to scrutinize pricing arrangements even when the goods are sold to a broad, non‑discriminatory customer base. Clients should review their pricing contracts for any clauses that could inadvertently trigger price‑discrimination claims and monitor forthcoming FTC gu

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On October 9, 2026, the SEC proposed amendments to Rule 17a-7 under the Investment Company Act of 1940 that would again permit registered funds to cross trade, reversing the 2020 amendments that eliminated fixed-income cross trading while leaving equity cross trading permitted. Why sophisticated counsel and clients care: cross trading has historically been a core tool for managing portfolio transition costs, internalizing trades and reducing transaction costs for fund portfolios. Its removal in 2020 reshaped fixed-income trading workflows across asset managers and their service providers; a proposal to restore it signals a reversal in the Commission's policy stance, but it remains a proposal, not a rule, and the adopted text, transition mechanics and any conditions could differ materially from what is proposed. Advisers should treat nothing as operative today. Action and what to watch: the comment record and rulemaking docket, including how any restored framework addresses valuation discipline, conflicts review, fund-level governance and operational controls built in the absence of f

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On October 6, 2026, the Internal Revenue Service, the Employee Benefits Security Administration and CMS issued final amendments to the Transparency in Coverage rules for non-grandfathered group plans and individual-market issuers. Per the Norton Rose Fulbright summary, plans and issuers must now publish one in-network rate file per provider network rather than per plan, identified by network name and identifier; new Taxonomy and Utilization files map negotiated rates to providers' specialty taxonomy codes and flag "ghost rates" unlikely to be reimbursed; the out-of-network allowed amount threshold falls from 20 claims to 11, with a six-month reporting period and nine-month lookback; and each file must carry a knowledge-and-belief attestation naming the senior official accountable for accuracy, plus a plain-text location file and a "Price Transparency" homepage link.

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California has enacted SB 690, which according to a Perkins Coie client alert signals an end to private pen register and trap-and-trace claims under the California Invasion of Privacy Act. Those CIPA provisions — written to govern government process — have been used by consumer plaintiffs in civil litigation alleging improper logging of call metadata and location data, producing volume filings, class actions, discovery disputes and settlement costs for communications, adtech and platform clients. Sophisticated privacy and litigation counsel should treat the development as materially favorable but not self-executing: the alert comes from a single firm and characterizes the statute's effect rather than setting out its operative language. The practical questions that will decide real exposure are the effective date, whether the change reaches conduct already sued, and whether private plaintiffs' standing has been narrowed or eliminated outright, since each determines whether pending cases survive or are dismissed and whether the statute reaches conduct outside California. Counsel should

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On 14 October 2026, DHS/USCIS published a proposed rule (91 FR 65119; Docket No. USCIS-2026-0529) that would delete 8 CFR 214.1(c)(5), the regulation requiring officers to defer to a prior eligibility determination for the same parties and underlying facts absent material error, change or new adverse information. Officers could still weigh earlier approvals, but would no longer start from a position of deference, and DHS would drop the guidance requiring supervisory sign-off to decline deference. The same day DHS issued a final rule ending automatic extensions of most EADs, compounding exposure for H-4 dependents.

DHS estimates deference currently covers about 208,429 petitions annually and projects roughly 6,044 additional RFEs; petitions receiving an RFE ran a median of 64 days longer. Because work authorization beyond 240 days already depends on timely filing, longer adjudication raises stop-work risk for same-employer extensions and could increase reliance on premium processing.

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Sanofi and Regeneron announced on October 1, 2026 that they are expanding their existing immunology collaboration to develop and commercialize four long-acting antibodies, with a $1 billion upfront payment from Sanofi to Regeneron and headline economics of up to roughly $8 billion including milestones and royalties.

Why sophisticated counsel should care: a collaboration expansion of this scale between two top-tier biologics developers signals continued appetite for anti-inflammatory antibody platforms and reallocates capital inside large-cap R&D pipelines. For life-sciences transactional teams, the deal is a live reference point for how upfront-versus-milestone risk is shared, how long-acting formats are carved out among existing programs, and how commercial territory and profit-share economics get reset when a flagship alliance is amended. It also carries the usual diligence overlay — antitrust review of overlapping immunology portfolios, IP prosecution and licensing boundaries between the partners, and supply arrangements for long-acting formulations.

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The Competition Appeal Tribunal has approved the distribution plan for the £92.75 million total recovery secured by class representative Mark McLaren in the RoRo collective proceedings, described in the reporting as a landmark ruling for the UK collective regime. Because the CAT must scrutinise the mechanism by which recovered damages reach class members, an approval of this kind signals that the proposed scheme — its costs, remuneration and eligibility rules — met the applicable collective-proceedings requirements. Counsel advising in UK competition and damages claims will read the decision as a working template for structuring settlements and contested recoveries that are capable of approval, rather than a distribution that merely had to be negotiated privately. Defendants and insurers with exposure to follow-on claims should watch how the CAT's reasoning on remuneration and administration is used or distinguished in later applications. The excerpt provided does not set out the full reasoning or the terms of the distribution mechanism, so the precise scope of any precedent should b

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On October 8, 2026, DHS published a Notice of Proposed Rulemaking in the Federal Register covering Optional Practical Training (OPT), which lets F-1 students work in the U.S. for up to 12 months after graduation, with a further 24 months for STEM graduates. The proposal would charge SEVP-certified schools $70,000 for a student's first OPT recommendation of any type and $30,000 for each subsequent recommendation, including STEM OPT extensions. DHS frames the fees as an anti-fraud and enforcement measure, but the practical effect would fall on institutions: potentially six-figure per-student costs that universities, and employers sponsoring interns, may seek to pass through or restructure. Nothing is in effect yet; the comment period closes November 9, 2026, and the existing OPT framework is unchanged unless DHS issues a final rule. Counsel for schools, employers, and student groups should assess budget and compliance exposure, prepare comment submissions if the burden warrants, and track whether DHS retains or revises the fee structure and its evidentiary basis, which is the most like

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On September 15, 2026, the U.S. Court of Appeals for the Fifth Circuit vacated the Environmental Protection Agency’s (EPA) 2024 methylene‑chloride risk‑management rule under the Toxic Substances Control Act (TSCA). The court found EPA’s "whole‑chemical" approach—collapsing all uses into a single risk assessment—violated TSCA’s requirement to evaluate unreasonable risk conditionally for each use. It also rejected EPA’s reliance on worker exposure data and argued that the agency ignored benefits, economic consequences, and feasible alternatives, rendering the prohibition of most consumer and limited commercial uses arbitrary and capricious. The decision mandates that EPA conduct a rigorous review of all available scientific information and remake the rule within statutory limits. Major clients in manufacturing, chemical distribution, and consumer products must watch EPA’s response, as the vacated rule removed a compliance burden that had impacted product formulations, labeling, and workplace safety protocols nationwide. The ruling signals a shift toward stricter statutory compliance an

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House Bill 380, passed in Delaware’s 2026 session, widens the scope of personal data covered and strengthens consent requirements, imposes minimum standards for security safeguards, and introduces a new duty for companies to report data‑breach incidents to state regulators within 72 hours. Existing Delaware‑registered businesses—whether small firms or multinational corporate subsidiaries—must reassess their data‑processing activities to ensure that all personal information, including employee and customer data, is addressed under the new definitions. The law also creates a state‑appointed compliance office that can conduct audits and issue enforceable penalties ranging from administrative fines up to 10 % of a company’s Delaware‑wide annual revenue. Firms should begin by reviewing their data‑inventory practices, updating privacy notices, and establishing breach‑response workflows that trigger the mandatory reporting window. From the next quarter—January 2027 onward—state‑based compliance teams could face increased scrutiny, so early adjustment will mitigate audit risk and potential l

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The New York Court of Appeals has formally embraced Delaware’s jurisprudence on controlling‑shareholder buy‑outs in going‑private transactions. In the landmark Matter of Kenneth Cole Prods., Inc. decision, the court held that a controlling shareholder can receive business‑judgment deference only when the buy‑out is conditioned on approval by an independent special committee and a majority of minority shareholders—and that both safeguards must function. If either fails, the transaction falls under an entire‑fairness review. This ruling reinforces the need for buyers and minority investors to structure buy‑out deals with explicit approval mechanisms and to document the functioning of special committees. Counsel should advise clients on the procedural prerequisites to secure deference, review past transactions for compliance, and assess potential litigation risks arising from non‑compliance. The decision also signals a shift toward greater opacity in minority‑shareholder protection, prompting firms to re‑evaluate their buy‑out strategies and engagement with litigation desks.

Virginia’s non‑compete statute was amended on July 1, 2026 to impose a two‑pronged test for enforceability: a clause must specify a severance amount, or otherwise compensate the employee, and the clause must be narrowly tailored to protect legitimate business interests. The changes extend the statutory definition of “reasonable however” to include the amount of compensation as a determining factor, effectively tightening enforcement. Firms with employees or clients operating across state lines should review existing agreements, adjust severance packages, and update HR policies to ensure compliance. Failure to comply can result in unenforceable clauses and potential litigation over misapplied non‑compete restrictions. Legal teams should also monitor upcoming case law that may further clarify the court’s approach to the new compensation requirement and the scope of acceptable business interests. This development is significant for all law practices dealing with Virginia talent and is likely to affect contracts, litigation, and advisory work.

The Third Circuit’s ruling affirms that Westlaw’s editorial headnotes are subject to copyright and rejects a defense that their use for training AI models qualified as fair use. The court held that the headnotes’ derivation from underlying case law conferred copyright protection, and that the AI‑training activity did not meet the transformative or qualitative tests of fair use. The decision signals a higher bar for legal‑research AI tools that rely on proprietary headnotes, prompting firms to reassess data‑sourcing models and to document compliance frameworks. Firms should audit their AI‑training datasets for copyrighted content, consider licensing agreements with Westlaw, and monitor subsequent circuits for similar challenges. The ruling may also spur the industry to develop open‑source or white‑label headnote alternatives to meet the growing demand for AI‑enhanced legal research.

On October 14, 2026, the FDA announced its Rare Disease Framework Initiative, compactly redefining how regulators evaluate therapies for patient populations too small for conventional study designs. The six‑pronged approach emphasizes fit‑for‑purpose evidence, patient engagement, external expertise, shared training resources, risk‑based assessment, and cutting‑edge trial methodologies. Concurrently, the agency issued a Request for Information, inviting stakeholders to contribute feedback through a public meeting on October 28 and until December 11, 2026. Law firms advising clients in biotech, pharma, or medical‑device sectors should now monitor the docket for guidance interpretations, assess how revised frameworks may alter IND or NDA submission strategies, and incorporate patient‑voice data early in development programs. The initiative also dovetails with upcoming Congressional discussions on the Prescription Drug User Fee Act reauthorization, positioning the framework as a potential benchmark for future policy. While the advice must be tailored case‑by‑case, timely engagement could

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