In House

In House - The FindLaw Corporate Counsel Blog


KBR Inc., a Texas tech and engineering company, has settled the first SEC "pretaliation" enforcement action under Dodd-Frank, Inside Counsel reported yesterday. KBR's standard confidentiality agreement, used in internal investigations, forbids employees from "discussing any particulars" about the investigation without prior authorization from the law department. That's illegal pretaliation, according to the SEC.

In-house counsel, get ready to spend your weekend reviewing your company's confidentiality policies!

The nation's largest retailer, of both discount goods and guns, doesn't have to include a proposal from shareholders in its proxy materials, the Third Circuit ruled on Tuesday. A lower court had ruled that Walmart violated securities law when it refused to include a proposal by a shareholder and one of the nation's oldest churches, Trinity Wall Street.

The case is a reminder of the fine line between shareholder proposals which seek to change a business's social policy, which are permissible, and those which seek to change its day-to-day operations, which a company may ignore.

It's already started. The 2016 presidential election is more than a year and a half away, but we're already being asked if we're ready for Hillary or willing to pass the hat for Ted Cruz. The election season is upon us and it's not going away anytime soon.

For many people, politicking isn't an after-hours only hobby, but something that pervades their whole life. So what's a GC to do when campaigning leaks into the office?

Amazon and Yelp are both currently suing companies that sell fake online reviews, a major reminder that online reputation can have a major impact on the success or failure of a business. Reading just three negative reviews can be enough to change the mind of most consumers, according to The Guardian, so sham online ratings may result in serious damages.

So, what should you do if your company is bombarded with false, negative reviews? Here are three tips:

Companies that rely on highly skilled foreign workers to replace domestic counterparts may be facing increased scrutiny in the near future. Ten senators recently called for an investigation into the government's H-1B visa program. That program allows employers to hire specialized foreign workers in order to fill slots that can't be filled by domestic labor.

Many companies, particularly in the tech industry, have been arguing for an expansion to the program. To critics, however, the H-1B visas aren't a source of new talent, but an open door to replacing American workers with lower paid foreign labor. Recent developments could put a kink in the plans of employers who rely on such visas.

JPMorgan Chase is instituting new software that will identify "rogue employees" before they actually do wrong, the banking and financial services company announced. We'll skip the comparison to "Minority Report," the early aughts film in which Tom Cruise hunts down "precriminals" before they can act.

Chase has been rattled by compliance over the past years, having recently settled a Department of Justice investigation into its mortgage practices for $13 billion. It has faced continuing investigation on multiple fronts, from accusations that it manipulated energy markets, to claims it improperly steered clients into self-serving investments.

Could a corporate Big Brother be the answer to Chase's woes? If it is, will others follow?

After I fire up my computer every morning, I have some special alone time with my RSS feeds and my cup of coffee. I get oriented by reading about what's going on in the world (being in California means the rest of the country has already been awake for two to three hours, so a lot has happened).

In-house counsel need to stay up to date, as well. So what should you be reading (in addition to FindLaw's In House, of course)? Here are some of our favorite sites for GCs.

There are plenty of stories of lawyers leaving firm life. In fact, the attrition rates for associates are huge. That many lawyers will eventually move on is a given and it's no secret that many lawyers fleeing firm life would love to become in-house counsel or even GC's.

But, once the migration has been made, would a GC ever go back? Could she?

Things aren't looking good for Wynn resorts and casinos these days. Institutional Shareholder Services, a proxy advisory firm, issued an unusually strong condemnation of Wynn and its management, saying that it had created a corporate governance record that is "among the worst" in the U.S. It urged shareholders to withhold votes for every nominee to the board.

Elaine Wynn, one of the resort's co-founders, has been campaigning to rejoin the board. The board had voted to allow her seat to expire this April, reducing its size from eight to seven, and had supported two incumbent directors, but not her, for re-election.

As a co-founder of the company and director for 13 years, the proxy firm held her responsible for many of the failings at the resort company. Here are three lessons to be learned from their report:

A new phishing scheme to be on the look out for, one which is stealing millions from American companies and making headlines for its sophistication. This new threat to your cyber security adds a twist to traditional schemes: using live, human operators who fraudulently obtain your information during mock customer service calls.

The scam, labeled "Dyre Wolf" after the extinct and often mythologized predator, was discovered early in April by IBM. It's brought in $1 million thus far. That's nothing compared to many other schemes -- another sophisticated online fraud resulted in a $26 million judgment just the other day. Why is Dyre Wolf something to be concerned about then? The fact that it targets U.S. businesses and that it does so so well.