DROPLETS

CBP has issued an interim final rule restricting the use of foreign entities as importers of record and expanding customs broker liability. Interim final rules generally take effect on publication rather than after the full notice-and-comment cycle, so the operational effect lands before trade counsel can weigh in through comments.

Why sophisticated counsel should care: importer-of-record structure sits at the foundation of inbound supply chains, determining who is liable for duties, admissibility, marking and recordkeeping obligations. Customs brokers are the operational gatekeepers for those entries. Expanded broker liability could expose brokers to enforcement and licensing consequences for conduct they did not control, pushing clients to revisit broker selection, contractual indemnities, allocation of compliance responsibility, and internal audit scope.

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On the first day of Texas prefiling for the 2027 session (November 9, 2026), at least five bills were filed to repeal the state's sales tax exemption for data centers, including HB 167 by Rep. Trey Martinez Fischer and SB 293 by Senate Finance Chair Joan Huffman, which 23 of 31 senators and members-elect had signed by that evening. The exemption (Tax Code §§ 151.359, 151.3595) shields qualifying facilities from the 6.25% state sales tax on servers, cooling systems, generators, software and electricity for up to 15 or 20 years; the comptroller now projects a $3.3 billion cost for 2028-29, against $14.6 million originally estimated. The bills diverge on the 138 already-certified facilities: HB 167 would let existing certifications run to term, while SB 293 as described would end them on the effective date, and both would deny pending comptroller applications. Separately, the governor has paused ERCOT interconnection approvals and TCEQ permits pending an audit due in December, and a Zaffirini package would require a PUC construction permit for sites of 75 MW or more. Counsel should watc

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On November 9, 2026, the U.S. Court of Appeals for the Ninth Circuit issued its written opinion in Chamber of Commerce v. Sanchez, No. 25-5327 (9th Cir. 2026), the challenge to California SB 253 (Climate Corporate Data Accountability Act) and SB 261 (climate-related financial risk reporting). The panel reversed the district court's denial of preliminary injunctions as to SB 253's Scope 3 emissions disclosures and SB 261's biennial financial risk reports, finding them likely unconstitutional under the First Amendment. Entry of those injunctions, and any severability ruling under SB 253's express severability clause, remains with the district court; SB 261 enforcement has been enjoined since November 18, 2025. SB 253's Scope 1 and 2 disclosures were not enjoined and remain in place, with the first filing due November 10, 2026.

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On October 30, 2026, HHS published in the Federal Register an interim, non-binding enforcement discretion policy covering Section 503A compounding with six peptide bulk drug substances: BPC-157, Epitalon, KPV, MOTS-c, Semax and TB-500. HHS states it does not intend to enforce against state-licensed pharmacies, federal facilities and licensed physicians compounding with those peptides while FDA finishes rulemaking to build the 503A bulks list. Each peptide had been in Category 2 since September 2023, and CDER had recommended against listing all of them; HHS justified inclusion citing characterization data, documented historical use and policy safeguards, and framed the policy as a way to displace research-use-only peptides from foreign manufacturers.

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Perkins Coie reports that revised EU EMIR clearing thresholds and calculation methodologies apply from 10 November 2026, changing how financial counterparties (FCs) and non-financial counterparties (NFCs) determine whether they sit above or below the relevant clearing thresholds. This cluster contains only that single firm alert, so specific threshold values and revised calculation methods are not in the evidence and should be verified against the underlying regulatory text.

Counsel should care because thresholds are the operative trigger for mandatory central clearing: an NFC above the threshold for an asset class must clear, a board-level capital and liquidity decision, not a documentation exercise. Revised methodologies can also move a firm across that line in either direction, changing which positions must be cleared and how contracts are classified as complex or non-complex.

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The Ninth Circuit issued a decision on the appeal of the Central District of California's earlier denial of a preliminary injunction sought against SB 253 and SB 261, California's climate-related disclosure statutes. The available material does not state whether the panel affirmed, vacated, or remanded the denial, nor does it describe the reasoning, so the operative holding — including any limitation on the mandates' scope, any timing relief, or the treatment of the separate reporting obligations under each statute — must be confirmed against the slip opinion before it is relied on.

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On November 9, 2026, the Ninth Circuit held that California's SB 253 climate disclosure law likely survives First Amendment intermediate scrutiny as applied to Scope 1 and Scope 2 emissions, leaving the November 10, 2026 first-year reporting deadline in effect for covered entities (U.S.-based companies with more than $1 billion in revenue doing business in California), which must still submit 2025 data or a statement of non-reporting through the Air Resources Board's intake channel. The court reached the opposite result for Scope 3 emissions and for SB 261's climate-related financial risk reporting, characterizing both as noncommercial speech subject to strict scrutiny and finding them insufficiently tailored because the record offered scant evidence that compelled reporting would reduce emissions. The panel remanded to the Central District of California to determine whether the Scope 3 provisions can be severed, while Judge Bennett concurred in part and dissented in part, arguing both statutes compel noncommercial speech and should have been enjoined entirely. Counsel should watch t

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A law-firm alert from McDermott Will & Emery, published in November 2026, addresses the legal and regulatory consequences of the two critical PHP vulnerabilities disclosed on 21 October 2026, noting that PHP scripts are used to build roughly 70% of websites on the internet. The analysis is framed around why the disclosure matters to counsel rather than how the flaw works: for a multinational operating consumer-facing services, an unpatched instance could translate into unauthorized access to personal data, converting an engineering ticket into a legal question about notification duties.

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On October 28, 2026, the U.S. Equal Employment Opportunity Commission voted to rescind, effective immediately, its "Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act," announcing the action the following day. The withdrawn guidance had been published in 2012 and provided the agency's published framework for analyzing arrest and conviction records under Title VII's disparate-impact principles. Rescission withdraws that interpretive guidance, but it does not repeal Title VII itself or any judicial precedent construing it, and the reported material describes no change to other federal regimes such as the Fair Credit Reporting Act or to state fair-chance laws. It also notes no litigation challenging the vote and no replacement guidance, so whether further agency action, new guidance, or a court challenge follows remains uncertain. For employers, the operative point in the report is that withdrawal of federal guidance is not a licence to abandon individualized assessment: hiring criteria, screening-ve

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On September 1, 2026, the Eleventh Circuit vacated the Middle District of Florida's 2024 ruling in Zafirov v. Florida Medical Associates (No. 24-13581), which had held the False Claims Act's qui tam provisions unconstitutional under Article II's appointments clause. The panel reasoned that relators do not occupy a "continuing position" and therefore are not Officers of the United States, and it declined to reach the significant-authority argument, joining the Fifth, Sixth, Ninth and Tenth Circuits on that clause. Unresolved take care and vesting clause challenges were remanded to the district court, and parallel arguments remain pending in the Third and Fifth Circuits, so the qui tam framework's constitutionality is not settled.

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On November 9, 2026, the US Court of Appeals for the Ninth Circuit narrowed California's climate disclosure regime, addressing challenges to Senate Bill 253 (greenhouse gas emissions reporting) and SB 261 (climate-related financial risk reporting). The panel affirmed denial of a preliminary injunction as to SB 253's Scope 1 and 2 requirements, leaving the California Air Resources Board's November 10, 2026 first-year reporting deadline in effect, so covered companies should proceed with planned Scope 1 and 2 submissions. Separately, the court held that SB 253's Scope 3 reporting requirement, scheduled to begin in 2027, and SB 261's disclosure obligations are likely unconstitutional under the First Amendment and that preliminary injunctive relief is warranted as to both. On remand, the district court must decide whether the Scope 3 provisions are severable from the rest of SB 253 before entering relief, which could affect the statute's surviving requirements. Sophisticated clients care because the decision reshapes multi-year disclosure build-out and compliance obligations, and because

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According to Latham & Watkins' alert, the UK government has announced a mandatory human rights due diligence regime that would require the largest businesses operating in the UK market to identify, assess and address human rights and forced labour risks in their own operations and across their supply chains. The summary available here does not set out thresholds, an implementation timetable, enforcement mechanisms or penalties, nor whether the proposal is already drafted legislation or a consultation stage, so those specifics should be confirmed against the government's own materials before clients are advised.

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The Department of Labor published a final rule on November 2, 2026, effective January 4, 2027, requiring PBMs and certain affiliated brokers, consultants and service providers to disclose to plan sponsors the fees and compensation they receive, including manufacturer rebates and discounts, administrative fees, spread pricing, pharmacy recoupments, formulary placement incentives and compensation paid to affiliates and subcontractors, plus drug pricing methodologies and arrangements directing participants to affiliated pharmacies. Detailed obligations generally apply to ERISA self-insured group health plans sponsored by employers averaging at least 100 employees, and can be triggered through TPA or level-funded arrangements; fully insured plans are generally outside the rule's detailed duties, though statutory compensation disclosure requirements enacted in the Consolidated Appropriations Act, 2026 already apply to them. Disclosures are due reasonably in advance of new contracts, renewals and extensions (90 days deemed reasonable) and in reports every six months, or quarterly on reques

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What is reported: Hogan Lovells has circulated analysis of a leaked draft of the proposed EU Digital Fairness Act (DFA), a Regulation the European Commission is expected to present formally on 11 November 2026. On the firm's account, the leaked text indicates the initiative could substantially reshape the EU framework governing consumer protection. The operative provisions are unverified: the leak is unofficial, and the Commission's own proposal, recitals and implementation timetable are still pending.

Why counsel should care: the framework at issue governs how terms, offers and commercial practices are assessed against consumer-protection standards, and a Regulation of this kind would reach consumer-facing businesses operating in, or into, the EU. Because the text is not public, firms cannot rely on the leaked specifics.

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According to Sullivan & Cromwell, the EEOC voted on October 28, 2026 to rescind its 2012 enforcement guidance addressing employers' consideration of arrest and conviction records under Title VII. The agency framed the action as not reinstating policy statements superseded by the 2012 guidance and not requiring employers to abandon lawful practices adopted in response to it. The withdrawn guidance had directed employers to weigh the nature and gravity of the offense, the time since the offense or completion of sentence, and the nature of the job, and to conduct individualized assessments; it also stated that an arrest alone does not prove the underlying conduct. Chair Andrea Lucas said the rescission "reaffirms the agency's commitment to enforce Title VII consistent with the Constitution and the limits Congress placed on the EEOC's authority," consistent with an agency emphasis on intentional-discrimination theories over disparate impact. The rescission does not amend Title VII, so private plaintiffs can still pursue disparate-impact claims. Employer takeaways: apply criminal-history

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Per Sullivan & Cromwell's November 10, 2026 analysis, the DOJ launched the Fraud Whistleblower Incentive Program (WHIP) in October 2026 as a three-year pilot that pays individual tipsters $10,000 to $30,000 for information leading to criminal fraud charges — payment at the charging stage rather than years later on final resolution. WHIP targets federal health care offenses and fraud against programs or benefits administered by the Departments of Agriculture, Labor, HHS, HUD, Education and Veterans Affairs, with particular emphasis on hospice, home health care, day care and special services fraud. Eligibility requires voluntarily providing original, truthful and complete information in writing; entities, law enforcement personnel, and anyone who "meaningfully participated" in the fraud are excluded.

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The U.S. Department of Justice announced on November 5, 2026 the creation of a Super Intelligence Task Force (DOJ-SITF), drawing on an October 13, 2026 memorandum from Attorney General Todd Blanche. The task force is described as a mechanism for the Department to coordinate enforcement activity relating to artificial intelligence.

Why sophisticated counsel should care: a standing, centralized coordinating unit changes the routing and visibility of AI-related investigations for companies whose products, models, transactions or employees intersect with the conduct in question. Clients across the AI supply chain — model developers, deployers, and vendors building on third-party platforms — should expect that internal escalations, voluntary disclosures and government inquiries may now be handled through a single coordinating office, which affects privilege handling, internal reporting lines, and the timing and posture of cooperation.

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