PCCE Hosts Roundtable Discussion on Leniency Policies with the DOJ’s Antitrust Division

All photos courtesy of NYU Photo Bureau

On September 19, 2024, the NYU Law Program on Corporate Compliance and Enforcement (PCCE) hosted senior members of the U.S. Department of Justice’s Antitrust Division including Emma Burnham, Director of Criminal Enforcement, Ryan Danks, Director of Civil Enforcement, and Sean Farrell, Chief, New York Office, as well as academics, in-house counsel, and distinguished members of the antitrust bar to examine the efficacy of the Antitrust Division’s corporate and individual leniency policy and discuss possible reforms. The roundtable discussion was moderated by Director Burnham, PCCE Faculty Director Jennifer Arlen, and NYU Law Professor Daniel Francis.

Photos of the event below:

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DOJ Releases Updated Evaluation of Corporate Compliance Programs Guidance

by Ann Sultan, John E. Davis, and Kathryn Cameron Atkinson

Left to right: Ann Sultan, John E. Davis, and Kathryn Cameron Atkinson. (Photos courtesy of Miler Chevalier Chartered)

On September 23, 2024, in conjunction with a related speech at the Society of Corporate Compliance and Ethics (SCCE) Compliance & Ethics Institute by Principal Deputy Assistant Attorney General (PDAAG) Nicole M. Argentieri, the U.S. Department of Justice (DOJ) released an updated version of its guidance to prosecutors on the Evaluation of Corporate Compliance Programs (updated ECCP). The DOJ last updated this guidance in March 2023. View a redline comparison of the September 2024 updates to the March 2023 version here.

The DOJ’s substantive revisions for this round of updates focused primarily on using data and technology related to various compliance program elements, integrating and adapting to lessons learned from other companies, and reporting. As PDAAG Argentieri noted, the DOJ “regularly evaluate[s] our policies and enforcement tools, including the ECCP, to account for changing circumstances and new risks.”

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Federal Court Invalidates NYC Law Requiring Food Delivery Apps to Share Customer Data with Restaurants

by Phyllis H. Marcus and Robert Edwards

Photo courtesy of Hunton Andrews Kurth LLP

On September 24, 2024, a federal district court held that New York City’s “Customer Data Law” violates the First Amendment. Passed in the summer of 2021, the law requires food-delivery apps to share customer-specific data with restaurants that prepare delivered meals.

The New York City Council enacted the Customer Data Law to boost the local restaurant industry in the wake of the pandemic. The law requires food-delivery apps to provide restaurants (upon the restaurants’ request) with each diner’s full name, email address, phone number, delivery address, and order contents. Customers may opt out of such sharing. The law’s supporters argue that requiring such disclosure addresses exploitation by the delivery apps and helps restaurants advertise more effectively.

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PCCE Welcomes Four New Members to its Board of Advisors

The NYU School of Law Program on Corporate Compliance and Enforcement (PCCE) is delighted to announce that Avi Gesser, Randall Jackson, Winston Paes, and Jennifer Zachary have joined PCCE’s Board of Advisors.

Left to right: Avi Gesser, Randall Jackson, Winston Paes, and Jennifer Zachary (Photos courtesy of board members)

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Three – No, Four – Important Revisions to the Department’s Policy on the Evaluation of Corporate Compliance Efforts

by Bethany Hengsbach and Steve Solow

From left to right: Bethany Hengsbach, and Steve Solow. Photos courtesy of the authors.

In a speech at the Program on Corporate Compliance and Enforcement at NYU School of Law, Nicole Argentieri, Acting Assistant Attorney General of the Criminal Division, announced key revisions to the March 2023 Evaluation of Corporate Compliance Programs (ECCP). The September 17, 2024 speech was followed by the release of the updated ECCP on the DOJ website. The revised ECCP converts leading edge compliance efforts into standard operating procedures (SOPs) against which companies will be judged by the Department of Justice (DOJ) when making prosecution decisions. The primary changes include three new areas of focus, and a fourth important expansion of a pre-existing idea: Continue reading →

Avoid Kicking the Hornet’s Nest: A Fresh Look at How to Anticipate, Avoid, and Respond to BIS Administrative Subpoenas (Part 2)

by Brent Carlson and Michael Huneke

Brent Carlson and Michael Huneke (photos courtesy of authors)

In Part 2 we pick up where we left off in Part 1 to continue our discussion of how best to avoid an administrative subpoena. We then discuss how best to respond, if and when they cannot be avoided, and conclude with some practical guidance.

Avoid: How to Dissuade BIS from Resorting to Administrative Subpoenas (Continued)

Prepare well for outreach visits

Companies should prepare for outreach visits. Persons who will be meeting or speaking with OEE agents should be well prepared to do so with an eye toward and an awareness of the implications of the information and representations they are providing to BIS. Any and all information that company representatives provide to BIS representatives is fair game for future enforcement and for sharing with other U.S. agencies.

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SEC Disbands ESG Enforcement Task Force

by John F. Savarese, Wayne M. Carlin, David B. Anders, and Carmen X. W. Lu

Left to right: John F. Savarese, Wayne M. Carlin, David B. Anders and Carmen X. W. Lu. (Photos courtesy of Wachtell, Lipton, Rosen & Katz)

The U.S. Securities and Exchange Commission (“SEC”) has disbanded its Climate and ESG Task Force in the Division of Enforcement. The Task Force was established in March 2021 with the purpose of identifying ESG-related misconduct, including material gaps or misstatements in issuers’ disclosure of climate risks, and assessing disclosure and compliance issues relating to investment advisers’ and funds’ ESG strategies. According to the SEC, the “expertise developed by the task force now resides across the Division” signaling that the SEC will continue to pursue ESG-related matters as part of its broader enforcement strategy.

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California’s Privacy Regulator Issues Enforcement Guidance on How To Avoid “Dark Patterns” in Obtaining Consumer Consent

by David L. Rice and Christopher W. Savage

Left to Right: David L. Rice and Christopher W. Savage (photos courtesy of Davis Wright Tremaine LLP)

On September 4, 2024, the California Privacy Protection Agency (“CPPA”) announced that it issued an Enforcement Advisory (“Advisory”) providing guidance on how to avoid using prohibited “Dark Patterns” to obtain consent from consumers. Businesses subject to the California Consumer Privacy Act (CCPA) routinely request consent from consumers related to their personal information and in handling consumer requests to exercise their statutory rights regarding their personal information. The CPPA’s advisory is a strong signal that the time for businesses to identify and remove Dark Patterns in these processes is now—before the CPPA commences enforcement—by reviewing user interfaces to ensure the language and interface design offering consumers privacy choices is clear and symmetrical.

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BIS Final Rule on Voluntary Self-Disclosure Process and Penalty Guidelines Highlights Significant Export Control Violations and Higher Penalties

by Christopher Timura, David Burns, Adam M. Smith, Stephenie Gosnell Handler, Samantha Sewall, Cody Poplin, Chris Mullen, and Audi Syarief

Top left to right: Christopher Timura, David Burns, Adam M. Smith, and Stephenie Gosnell Handler.
Bottom left to right: Samantha Sewall, Cody Poplin, Chris Mullen, and Audi Syarief. Photos courtesy of the authors.

In a final rule effective September 16, 2024, the Department of Commerce’s Bureau of Industry and Security (“BIS”) updated its process for handling voluntary self-disclosures from industry and expanded its discretion to impose higher monetary penalties for violations of export control laws. Whether to submit a voluntary self-disclosure remains a fact-dependent decision and requires careful weighing of factual, legal, practical and policy considerations.

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SEC Order Provides Warning to Fund Managers with Access to CLO-Related MNPI

by Matthew E. Kaplan, Jonathan R. Tuttle, Benjamin R. Pedersen, and Anna Moody

Left to Right: Matthew E. Kaplan, Jonathan R. Tuttle, Benjamin R. Pedersen and Anna Moody (photos courtesy of Debevoise & Plimpton LLP)

Introduction

On August 26, 2024, the Securities and Exchange Commission (“SEC”) announced settled charges against registered investment adviser Sound Point Capital Management, LP (“Sound Point”) for violating Sections 204A and 206(4) of the Investment Advisers Act of 1940 (“Advisers Act”) and Rule 206(4)-7 thereunder. According to the order, Sound Point failed to establish, maintain or enforce written policies and procedures reasonably designed to prevent the misuse of material non-public information (“MNPI”) concerning its trading of collateralized loan obligations (“CLOs”) that contained loans for which Sound Point was a lender.[1] Andrew Dean, Co-Chief of the SEC Enforcement Division’s Asset Management Unit, issued a statement on the same day reminding fund managers that they “must evaluate how their roles as lenders could expose them to MNPI that may relate to their CLO trading positions.”[2] These issues could also arise in contexts where the firm otherwise has access to MNPI.

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