Amidst a major lawsuit accusing Chevron and four other energy companies of misrepresenting their contributions to global warming, Chevron attorney, Theodore Boutrous, claimed it does not dispute that humans have induced climate change at a court hearing in late March.

Both Oakland and San Francisco filed a lawsuit against ConocoPhillips, Exxon Mobil Corp, Royal Dutch Shell PLC, BP PLC, and Chevron last year. The cities are pursuing an abatement fund as a remedy for the flooding they claim is directly linked to global warming. Democratic party leaders filed the lawsuits as a means to confront the massive issue of climate change in the judiciary. To date, more than 900 lawsuits regarding global warming span 25 different countries.

The United States’ climate change policy has dramatically changed since President Donald Trump was appointed. In addition to expressing his intent to remove the United States from the Paris Agreement, President Trump has gone as far as advocating for heavier fossil fuel production. The President has unapologetically stated that his administration is “putting an end to the war on coal,” and has even stated climate change was a hoax.

Most recently, the President issued a directive ordering the federal government to cease using climate change as a factor in its decision-making, even though the climate has been a consideration in every major court decision within the past few years. The directive further revealed the Trump Administration’s plans to table the Clean Power Plan. The Obama Administration implemented the plan in 2015 as a means to reduce power plants’ carbon pollution across the nation.

In the heat of this political pivot in climate change, plaintiffs’ lawyers will also have to overcome tricky precedents surrounding tort claims relating to global warming. For example, Kivalina v. ExxonMobil is a Ninth Circuit decision from 2009, which granted a motion to dismiss a case where Eskimos sought monetary relief for damages they suffered as a result of climate change.

The oil giants are confident this lawsuit will also get thrown out. In their recent filing, they argue that only Congress can legally monitor carbon emissions. The oil companies rely on AEP v. Connecticut, a Supreme Court decision from 2011, determined that climate change “is an undertaking for the political branches.”

Although none of the companies admitted liability for climate change, all of them acknowledged the scientific merits of global warming.

Chevron Attorney Admits What Trump Won’t (PDF)

The lines were blurred as to whether Robin Thicke and Pharrell Williams copied Marvin Gaye’s 1977 disco song, “Got to Give it Up.” Their song, “Blurred Lines,” was the biggest hit of 2013. Gaye’s family claimed Thicke copied the song without permission and brought the case to trial in 2015. After a seven day trial, the jury initially awarded Gaye’s family a damages award of more than $7 million. The jury was only able to rely on the sheet music, and not on recordings of the two songs.

On March 21, 2018, in a 2-1 decision, the Ninth Circuit upheld the jury’s finding that Thicke and William’s song “Blurred Lines” infringed on Gaye’s copyright song. The court also awarded damages in the amount of $5.3 million. The Gaye estate will also receive 50 cents per interest on future revenue from the song.

Opponents of the case warned that the suit could have a “chilling effect on creativity.” In her dissent, Judge Jacqueline Nguyen said the decision allowed the copyright of something that had never been copyrighted before: musical style. She said Thicke’s song only resembled Gaye’s in style and that the decision “strikes a devastating blow to future musicians and composers everywhere.” Over 200 musicians filed a brief in favor of Thicke and Williams, saying that the ruling would have an “adverse impact…on the music industry and would “eliminate[e] any meaningful standard for drawing the line between permissible inspiration and unlawful copying.”

The majority rejected the idea that the decision was a devastating blow on music. The court suggested that the case actually rested on the skills of Thicke’s attorneys. Gaye’s attorney applauded the ruling, saying that the decision encourages writers to create original work.

Drawing from the court’s dissent, Thicke’s attorney stated that there would be further appeal.

Court of Appeals Upholds Blurred Lines Ruling (PDF)

On Wednesday, March 28^th, 2018, a Delaware judge allowed lawsuits by Tesla Inc. shareholders against CEO, Elon Musk, and the Tesla Board to move forward over the company’s 2016 SolarCity acquisition. Vice Chancellor Joseph Slights of the Delaware Court of Chancery rejected Tesla’s motion to dismiss the seven derivative and direct claims brought by Tesla shareholders on behalf of themselves and a putative class of Tesla stockholders. Among the claims, shareholders allege that Musk and the Board breached their fiduciary duties to shareholders in approving the deal to buy SolarCity — a company on which Musk also served as Chairman.

The complaint alleges that Musk and the Board did not act in the shareholders’ best interests when Tesla, an electric car company, acquired cash-strapped SolarCity, a solar energy company, for $2.6 billion in June of 2016. At the time, SolarCity was facing serious liquidity challenges. In the three years leading up to the merger, its debt had increased thirteen-fold, totaling $3.56 billion, its stock value had decreased 64% from February 2015 to February 2016, and it was facing litigation alleging misappropriation of trade secrets and intellectual property. Amidst this liquidity crisis, the shareholders allege that the acquisition amounted to “a bailout” of SolarCity that benefited the Tesla Board members and their families. They contend that Musk used his “his control over the corporate machinery to, among other things, orchestrate Board approval of the Acquisition.”

Tesla’s legal team moved to dismiss the complaint under the Corwin standard, a 2015 Delaware Supreme Court decision holding that “a shareholder vote approving a transaction could effectively free a board from liability claims when the transaction did not involve a controlling shareholder.” Tesla’s counsel contends that an “overwhelming” majority of shareholders voted to approve the deal. Furthermore, Musk, who owned 22.1% of Tesla stock and 21.9% of SolarCity stock at the time of the acquisition, was not a controlling shareholder.

However, under the Kahn standard, courts determine whether a stockholder is a controlling stockholder if they either (1) own more than 50% of shares or (2) own less than 50% but exercise sufficient influence over the corporation to be deemed a “controlling stockholder.” Ultimately, the court held that although Musk owned less than 50% of the company, “Musk’s voting influence, his domination of the Board during the process leading up to the Acquisition against the backdrop of his extraordinary influence within the Company generally, the Board level conflicts that diminished the Board’s resistance to Musk’s influence, and the Company’s and Musk’s own acknowledgements of his outsized influence” all supported Plaintiff’s “reasonably conceivable” contention that Musk was a controlling stockholder.

A Tesla spokesperson expressed disapproval of the ruling and said “it’s important to emphasize that this was a motion to dismiss in which the court was required to assume as true all of the allegations that are made in the complaint.”

Did Tesla Breach its Fiduciary Duty to Shareholders in SolarCity Acquisition (PDF)

In early February, GM Korea had announced that it would shut down one of its four plants in South Korea and incur an US $850 million impairment charge as part of its restructuring plans in Asia. The company has been making losses in all Asian countries except China. In May 2017, the company had announced that it would exit the Indian automobile market, one of the fastest growing car markets in the world, as it could not consolidate its position due to stiff competition from Indian and other international manufacturers. However, the company said that it would maintain some of its plants in India to export cars to other countries.

On February 13, a court ruled in favor of 45 temporary workers of GM Korea, ordering GM to recognize them as full-time employees. GM had fired over 600 employees since last December, via a mobile phone message and without any severance package, citing high labor costs and low output as the primary reasons. GM Korea has appealed against the verdict of the court. Having lost his temporary job as a mechanist twice in the past eight years, Shin Hyun-chang is one of the many workers who wishes to be reinstated. “I asked myself ‘why is my life so gloomy? Nothing is going right,’” Shin told Reuters at a protest tent set up outside the Bupyeong GM factories in the suburbs of Seoul. “I moved one step closer to achieving my goal of becoming a regular worker, but the jobs that can help me get there may disappear soon,” he stated.

GM sells Chevrolet and Cadillac cars in Korea. More than half the vehicles produced in South Korea are exported. The company employs over 16,000 people. This announcement by GM comes at a tough time for South Korean President Moon Jae-in, who had promised to create more jobs and provide job security as part of his new economic policy.

As per the latest analyst reports, GM Korea’s production is expected to fall by a quarter to just over 42 percent, thereby, further affecting the temporary, as well as, full-time employees of the company. With a slump expected in production, the company is somewhat entering a downward spiral as low production means the company will not be selling or exporting as many cars as its potential, which in turn will cause worse conditions for the company in South Korea. GM has also said that it will have no choice but to file for bankruptcy if its unions do not agree to cut labor costs. What happens to the plight of the temporary workers, and GM Korea itself, remains to be seen, but what is sure is that GM really needs a Plan B to restructure its business in Asia amidst reports of fall in production and sales.

GM Korea- Dispute with Temporary Workers Adds to Woes (PDF)

When the Department of Justice filed its lawsuit against the $85 billion AT&T and Time Warner merger, both companies claimed that the government was “selectively enforcing” an antitrust law. This argument stemmed from President Trump’s vocal animosity towards CNN, a subsidiary of Time Warner. This political background inspired AT&T to request phone logs and emails between the White House and Justice Department. Judge Richard J. Leon, overseeing the trial in the District Court for the District of Columbia, denied the request and AT&T has since dropped the political argument from its brief.

On the same day that both sides laid out their arguments for trial, a group organized by the Protect Democracy Project filed an amicus brief asking Judge Leon to reconsider allowing discovery regarding White House interference. Protect Democracy is a bipartisan network of former White House lawyers whom have teamed-up to investigated the  “potential erosion of democratic norms under Trump.”  The organization believes Trump’s statements in the 2016 campaign indicate his intention to block the deal in violation of the Constitution.

At least eleven former U.S. officials participated in filing the amicus brief, some former DOJ officials whom are also contributors on CNN. Included in this group are former U.S. attorney from the Southern District of New York, Preet Bharara, and onetime White House counsel to President Nixon John Dean. President Trump fired Bharara in the early months of his administration and Bharara remains a vocal critic of the President. John Dean was a prominent figure in Watergate and also a vocal critic of Trump.

Absent political rhetoric, the trial is now focused on classic antitrust issues, including how the merger will raise prices for consumers and effect competition. Time Warner and AT&T insist the merger is an attempt to compete with online streaming services such as Netflix and Amazon Prime and reject the argument that it will hurt consumers.

While a merger of a TV-program producer and TV-program distributor would create a corporate behemoth, AT&T argues they are still an underdog to Google and Facebook post-acquisition. Trial started March 19^th and it remains to be seen whether the antitrust showdown will open the door for further telecom and media mergers or point to a new era of scrutiny towards an already wavering industry.

Trump Argument Absent from Brief Filed by AT&T and Time Warner (PDF)

Tinder, the app that revolutionized online dating, is going against its biggest rival in a new lawsuit filed on March 16, 2018.

Tinder’s parent company, Match Group, LLC (Match), is suing competitor app Bumble in Texas district court for patent infringement and stealing trade secrets. Yet this may be more than just your average patent lawsuit—some posit that it is the latest unconventional move by Match in an ongoing effort to acquire Bumble.

Match, which holds an impressive portfolio of several major dating services and over 23 million registered users, first made an offer to acquire Bumble in August 2017 for $450 million. Bumble turned down the offer amid reports that its actual valuation was closer to $1 billion. However, Recode recently reported that Match is still interested in acquiring Bumble, signaling that this lawsuit may really be a hostile bargaining chip in attempts to force Bumble to agree to the sale.

Moreover, a complicated history exists between the two dating apps. Bumble founder Whitney Wolfe Herd previously co-founded Tinder before suing the company in June 2014 for sexual harassment. In her suit, Herd alleged that her ex-boss and then-CMO at Tinder, Justin Mateen, robbed her of her co-founder title because he said that having a young female co-founder would “make the company seem like a joke.” Though the suit was eventually settled out of court for approximately $1 million, it did not include a non-compete clause. Herd soon went on to found Bumble, her own competitor dating app, geared primarily toward female users.

Herd’s new app immediately took off with the help of 79% shareowner Andrey Andreev, founder of Badoo, the world’s largest online dating network. Using Andreev’s expertise and Badoo’s infrastructure, Bumble launched in December 2014 with rapid success. The app garnered over 100,000 users in its first month alone. Herd then brought in two former Tinder executives, Sarah Mick and Chris Gulczynski, to design Bumble’s interface and back end.

Though Mick and Gulczynski have since left Bumble to launch their own agency, their involvement is another central issue to Match’s lawsuit. Match claims that the two executives stole “confidential information related to proposed Tinder features,” including the potential “undo” function that allows users to regenerate a match if they accidentally skip it. Match contends that Mick and Gulczynski were under confidentiality agreements, and therefore used trade secrets while knowing (or having reason to know) they were acquired by improper means.

In its 45-page complaint, Match requests an injunction against use of its patent rights, extensive damages, and a jury trial as to all issues. However, it is still unknown whether this suit is truly motivated by patent violations or just leverage for Match to persuade Bumble to accept its buyout offer. Only time will tell if this is the final push Bumble needs to join the Match portfolio.

Battle of the Dating Apps-Tinder Sues Bumble in Federal Court (PDF)

Earlier this month, French Prime Minister Edouard Philippe unveiled the government’s plan to decrease gender pay gaps in the workforce. If companies fail to erase the pay gap over three years, government inspectors could fine them up to one per cent of the company’s wage bill.

The plan will involve companies with employees numbering greater than fifty people. How does the government intend to detect wage gaps? Companies will have to install software designed to detect for unjustified pay gaps between men and women. The software will be connected directly to the company’s payroll systems.

One source cites France as the second worst country in a survey for gender wage disparities. Data from a World Economic Forum’s Global Gender Gap Report reports that France scores seventeenth best in the world for gender equality and is approximately 76 percent of the way towards achieving gender equality.

President Emmanuel Macron pledged in the beginning of 2018 to increase the government’s efforts in waging the war against gender pay disparities. Marlene Schiappa, France’s highest-ranking women’s right’s official went on record to say that France’s numerous laws on equal pay have not achieved its objectives. Moreover, she suggested that companies should be required to release data on salaries for its employees.

Within the broader European Union, the U.K. reported the largest increase in the gender pay gap in 2015. Today, the EU in general has an average pay gap of 16.3 percent, down from an approximate 25 percent in 1995. In practical terms, this amounts to labor provided by women to be ceased after early November. Experts attribute this pay gap to more males dominating senior management and other higher paid positions.

Some employers were hesitant to provide their approval of the new plan. These employers were in attendance during the press conference and they expressed concerns about the standards for determining whether a pay gap existed. In the coming months, the government will finalize details with employers, unions, and industry-insiders and could become part of a broader labor reform policy plan.

France Gives Companies Three Years to Erase Gender Pay Gap (PDF)

Last Thursday, Wells Fargo announced that four board members, including its three longest serving directors, will soon be stepping down. Federico F. Peña, Lloyd H. Dean, Enrique Hernandez Jr, and John S. Chen will officially leave by the next company’s annual shareholder meeting this April.

Since 2016, the bank has been on the loop for years of misconduct.  Among other malpractices, the bank was on account for charging customers with fraudulent bank accounts they did not consent to and for forcing them to take insurance they did not need.  This gave rise to one of the most relevant fraud scandals lately.

The Federal Reserve firmly condemned Wells Fargos board for failing to oversee the bank and not assessing the company’s and the CEO’s performance.  Since then, the Fed announced that the bank would be banned from getting bigger until they overhauled risk and strengthened its board’s oversight.  This forceful intervention meant that one of the biggest financial institutions would be unable to keep up with its fast-growing rivals.  Wells Fargo had nearly $2 trillion in assets at the end of 2017.

The Fed has been penalizing banks for misconducts, but they have never reached such an imposition that limited a major bank’s growth.  Ever since, the bank has been pushing for a quick recovery, and Well’s officials expect restrictions lifted within the next year.  Therefore, the announcement that directors were stepping down came to no surprise.

Jerome H Powell, the fed official overseeing the negotiations with Wells Fargo, said, “Across a range of responsibilities, we simply expect much more of directors than ever before; and there is no reason to expect that to change.”  Furthermore, Powell said that they have proposed a new framework for board oversight that introduces a new principles-based approach that intends to spotlight the Feds expectations of effective boards.

This represents a shift in the evolving relationship between regulators and banks and suggests that the board’s role will likely grow in importance.  Furthermore, it is a clear message that directors should be extremely vigorous in their duties and failure to oversee malpractices will bring about harsh consequences.  Perhaps it signals a corporate culture of more openness and shared accountability.

Four Directors will leave Wells Fargo’s Board (PDF)

In March 2018, President Trump signed his decision to impose tariffs on imports of steel and aluminum. In the wake of such a decision, international markets, longtime trading partners and members of the President’s own party are angry. The decision imposes a 25% tariff on steel imports and a 10% tariff on aluminum imports.

After announcing the tariffs, the President aggravated the situation by suggesting even broader tariffs for the European Union if it does not address the President’s (unspecified) concerns. On Twitter the President wrote, “The European Union, wonderful countries who treat the U.S. very badly on trade, are complaining about the tariffs on Steel & Aluminum. If they drop their horrific barriers and tariffs on U.S. products going in, we will likewise drop ours. Big Deficit. If not, we Tax Cars etc. FAIR!”

Unlike the European Union, Canada and Mexico are allowed an exemption, which is contingent on the three countries reaching a favorable renegotiation of NAFTA. Trump’s specific exemptions for Canada and Mexico come after what he thinks are large trade deficits with the two countries. On Twitter, he tweeted, “We have large trade deficits with Mexico and Canada. NAFTA, which is under renegotiation right now, has been a bad deal for U.S.A. Massive relocation of companies & jobs. Tariffs on Steel and Aluminum will only come off if new & fair NAFTA agreement is signed.”

NAFTA talks have been laden with contentious issues. The President believes that the NAFTA accord is flawed, leading U.S. companies to move factories to Mexico and disenfranchising American workers. The Trump Administration’s most contentious proposal, among others, is to require “more automobile manufacturing in the U.S., seasonal barriers to farming goods, access to U.S. procurement deals, dispute resolution mechanisms, and a clause that would terminate the deal after five years.”

Canada and Mexico, however, have indicated their unwillingness to submit to the Trump Administration’s treatment. “Canadian Foreign Minister Chrystia Freeland called NAFTA and the tariffs ‘quite distinct issues’ and said ‘our negotiating positions are absolutely unchanged.’” Negotiations to update NAFTA are following their normal course after beginning in August 2017, missing a December 2017 target, and continuing into another soft deadline of March 2018. Despite negotiations, Trump has called out Canada and Mexico for not doing more to “stop trans-shipment of steel and aluminum through their countries and into the U.S.” His issue comes from what he believes were the previous administration’s unfair trade deals that adversely affected Americans.

The exemptions for Canada and Mexico are not going to last forever. The finalization of such exemptions is subject to the changes made to NAFTA that satisfy Trump. While the President will urge the renegotiations of NAFTA to be done quickly, it is likely that negotiations will continue until the year’s end, in light of Canada and Mexico’s stance against the new tariffs. What is clear, however, is that whatever the exemptions, countries and the international markets are not reacting well to the decision.

Canada and Mexico’s Exemption from Increased Tariffs Tied to NAFTA Renegotiation (PDF)

As protests rise against the National Rifle Association (NRA) in the aftermath of the shooting at Parkland High School, several businesses have said that they are ending their partnerships with the gun advocacy group.

These decisions are largely in response to tweets demanding change under the trending hashtag, #BoycottNRA. First National Bank of Omaha got the ball rolling on Thursday, February 22, when it announced via tweet that it “will not renew its contract with the National Rifle Association to issue the NRA Visa Card.” Rental car companies hopped on board the next day, with tweets coming from Alamo Rent A Car, Enterprise, National Car Rental, and Hertz, denouncing their rental car discount program with the NRA. On Saturday, February 24, Delta and United Airlines joined in, announcing via tweet that they are discontinuing their discounted rates for NRA members.

Companies involved in the sale of guns have also taken a stance. On February 28, just two weeks after the Parkland shooting, Edward Stack, CEO of Dick’s Sporting Goods, announced that the company is immediately ending its sales of military-style semi-automatic rifles, raising the minimum age for gun purchasers to 21, and will no longer sell high-capacity magazines.

After learning that the gunman behind the Parkland shootings had purchased a firearm from the retailer last November, Stack and his colleagues at Dick’s believed that action was necessary, citing that “thoughts and prayers are not enough.” In a statement issued on February 28, Stack echoed and commemorated the activism of the high school students who survived the Parkland shooting, saying “We have tremendous respect and admiration for the students organizing and making their voices heard regarding gun violence in schools and elsewhere in our country.”

That same day, Walmart announced that it is also raising the minimum age for purchasing firearms and ammunition from 18 to 21. With these moves, Dick’s and Walmart join a number of companies that have made policy changes in response to the Parkland shooting.

These actions have not been without controversy. For instance, Georgia Lt. Gov. Casey Cagle threatened to “kill any tax legislation that benefits” Delta Air Lines after the company ended its relationship with the NRA. Several other Twitter users have vowed to take their business elsewhere from companies who have cut ties with the NRA.

When asked about such pushback amongst gun rights advocates, Stack acknowledged that the move “isn’t going to make everyone happy,” but recognized that companies must be “brave enough” to make changes for what they believe in.

Companies Cut Ties With the NRA and Change Store-Wide Policies on Gun Sales (PDF)