Business Law Advisory

July 2006

The Patriot Act: Bugging the Boardroom

Recent changes to the Patriot Act are evoking cries of "wiretapping corporate America" and "bugs in the boardroom."  Among the spring 2006 amendments to the Patriot Act, Congress added certain antitrust claims (Sherman Act Sections 1 & 2) to the list of crimes that can be investigated with bugs and wiretaps.  Sherman Act 1 & 2 claims include price fixing, territorial or customer allocations, and monopolization.  While the bugs and wiretaps are for potential criminal law enforcement, the Sherman Act does not distinguish between what will lead to a civil vs. criminal penalty.  Therefore, any perceived Sherman Act investigation now carries the additional risk that corporate communications may be intercepted by law enforcement agencies, potentially sweeping in a wide range of confidential business information and strategies.  At very least, this amendment prompts another reminder to business executives to avoid discussions that might implicate allegations of price fixing, territorial or customer allocations, and monopolization.  For further information, please contact Jeffrey R. Teeters at jteeters@fbtlaw.com or 513.651.6715.


Federal Court Rules in Favor of Bank

A federal court has ruled that plaintiffs who alleged negligence and breach of contract claims against a bank arising out of a security breach involving their non-public personal information failed to establish a valid case.  The court granted the bank’s motion for summary judgment because the plaintiffs were unable to show that any costs they incurred as a result of the breach were based on currently recognizable damages.  Their costs to monitor their credit and loss of time and money were not the result of any present injury but rather the anticipation of a possible future injury yet to occur.  (Forbes v. Wells Fargo Bank, No. 05-24098, 2006 WL 680522 (D. Minn. Mar. 16, 2006).  For further information, please contact Jane Hils Shea at jshea@fbtlaw.com or 513.651.6961.


Ohio Attorney General Issues Proposed Charitable Transparency Rules

On June 29th, the Ohio Attorney General proposed a dramatic overhaul of the rules governing Ohio charities. To improve transparency of Ohio charities, the 46 page set of proposed rules incorporate aspects of the IRS Model Conflicts of Interest Policy, the IRS Intermediate Sanctions Rules and Sarbanes-Oxley.  Click here for the full article.  For further information, please contact Douglas D. Thomson at dthomson@fbtlaw.com or 513.651.6935.


Complying with Personal Data Protection Rules for
Employees Outside of the US

Attention all companies with any employees outside the US:  You must consider how to comply with personal data protection rules of each country where you have employees.  This affects subsidiaries as well.  For public companies, there is an apparent conflict between what Sarbanes-Oxley requires (for whistleblowing, e.g.) and the rules of foreign countries.  For more information, click here to view a recent article co-authored by an FBT attorney and FBT's French MULTILAW member, recommending how to achieve trans-Atlantic compliance in this complex area.


Supreme Court Rejects “General Rule” Regarding Infringement

Prior to May 15, 2006, the Federal Circuit had established a “general rule” that a court order prohibiting further infringing conduct should follow from a holding of infringement of a valid and enforceable patent.  In Ebay v. MercExchange, the Supreme Court flatly rejected this, holding that the question whether such a prohibition should issue in a patent case must be decided under the same equitable principles that apply in any other case.  Patent owners should now consider that even after a court ruling of infringement of a valid patent an injunction does not necessarily follow and the infringing activity could be allowed to continue.  The patent owner may be entitled to other remedies, such as a reasonable royalty, but injunctive relief barring further infringing activity can no longer be presumed.  For further information, please contact Vance V. VanDrake III at vvandrake@fbtlaw.com or 513.651.6430.

Additional Documents:

Practices

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