On September 4, the Federal Reserve Board (Fed) released enforcement actions against a Texas-based bank, addressing regulatory violations and compliance lapses.
Continue Reading Fed Issues Cease and Desist Order for Crypto-Related Compliance and Risk Management Deficiencies
On August 29, the CFPB issued a consent order against a non-bank direct mortgage lender for misrepresenting the cost of its cash-out refinance loans, which are guaranteed under the VA home loan program, to active-duty servicemembers and veterans.
Continue Reading CFPB Penalizes VA Lender for Misrepresenting Cost of Cash-Out Refinance Loans
The New York Attorney General’s office and the UK Information Commissioner’s Office were busy last month when it came to children’s privacy. Both sought input from the public about regulating children’s online privacy, including on social media.
Continue Reading Regulators On Both Sides of the Pond Seek Input on Children’s Privacy
The Virginia Court of Appeals recently issued a consequential trade secrets ruling, reversing a jury’s multi-billion dollar damages award, and finding that the trial court committed several legal errors which improperly led to the largest damages verdict in Virginia’s history. The case, Pegasystems Inc. v. Appian Corp., No. 1399-22-4, involved two companies in the business process management (BPM) industry, each of whom offer platforms that enable third party business customers to build complex software applications using “low-code application development platforms.”
Continue Reading Virginia Court of Appeals Reverses Record $2 Billion Verdict, Emphasizing Damages Resulting from Misappropriation Must Actually Be Proved Under Virginia Trade Secrets Law
In an era where artificial intelligence (AI) is reshaping landscapes in the healthcare industry and beyond, understanding the governance of AI technologies is paramount for organizations seeking to utilize AI systems and tools. AI governance encompasses the policies, practices, and frameworks that guide the responsible development, deployment, and operation of AI systems and tools within an organization. By adhering to established governance principles and frameworks, organizations can ensure their AI initiatives align with ethical standards and applicable law, respect human rights, and contribute positively to society. Various international organizations have set forth AI governance principles that provide organizations with a
Continue Reading Navigating the Complex Landscape of AI Governance: Principles and Frameworks for Responsible Innovation
In California, although the prevailing rule is that each party in litigation must cover their own fees and costs, a litigant can be awarded reasonable attorney’s fees and costs if expressly permitted in a contract. Proprietary information agreements often include an award of attorney’s fees and costs if a company prevails in seeking injunctive relief for misappropriation of its trade secrets by a current or former employee. However, there is an ambiguity in whether a plaintiff actually prevails on a claim for trade secret misappropriation, entitling it to injunctive relief and therefore attorney’s fees, even without a showing of damages. In
Continue Reading Attorney’s Fees May Be Recoverable in Trade Secret Cases, Even Without Damages
On August 29, the DC Attorney General’s office announced settlements with four title insurance companies over their widespread use of illegal kickbacks in violation of DC’s Consumer Protection Procedures Act (CPPA). Under the terms of the settlement, the title insurance companies are required to pay a combined total of $3,290,000.
Continue Reading DC Attorney General Settles with Title Insurance Companies Over Alleged Kickback Scheme
On August 21, a group of trade organizations filed an amicus brief in support of a motion to dismiss filed by a subprime auto lender that is the target of a joint enforcement action brought by the CFPB and the New York State Office of the Attorney General in the Southern District of New York. The underlying complaint alleges that the auto lender misrepresented costs in loan agreements and tricked customers into high-cost loans on used cars in violation of the CFPA and New York usury limits (see previous blog post here). In particular, the complaint alleges that: (1) the
Continue Reading Amicus Brief Argues CFPB Overreached in Enforcement Action Against Auto Lender
On August 21, the CFPB entered into a consent order with a nonbank mortgage servicer for mortgage servicing violations and for violating an earlier 2017 CFPB consent order for deficient foreclosure practices.
Continue Reading CFPB Hits Executive Compensation in Action Against National Mortgage Servicer for Illegal Foreclosure Practices
On August 21, 2024, Sheppard Mullin’s Healthy AI team conducted a CLE webinar on what hospitals, health systems and provider organizations should consider in building an artificial intelligence (“AI”) governance program. As they discussed, key elements of an AI governance program include: (1) an AI governance committee, (2) AI policies and procedures, (3) AI training, and (4) AI auditing and monitoring. These components of an AI governance program will help healthcare organizations embrace the complexities of AI use in healthcare by establishing appropriate guardrails and systematic practices to encourage its safe, ethical, and effective use. This post reviews each of the
Continue Reading Key Elements of an AI Governance Program in Healthcare
The privacy space continues to evolve with the announcement of the new Data Privacy Unit within New Hampshire’s Consumer Protection and Antitrust Bureau. This new unit will enforce New Hampshire’s Data Privacy Act, which takes effect January 1, 2025. Enforcement includes seeking civil penalties against businesses that fail to comply with consumer rights requests. The AG’s office is currently accepting applications for the new unit.
Continue Reading New Hampshire AG Announces New Data Privacy Unit
The SEC recently issued an order and settlement against a company from a pair of cyberattacks in which millions of dollars of client funds were stolen. While the company was able to recover a portion of the funds and ultimately reimbursed clients for the money lost, the SEC still fined the company $850,000 for failure to provide the necessary safeguards to protect its clients’ funds.
Continue Reading SEC Continues its Cybersecurity Focus, Settles with Company over Lax Security Measures
On August 26, the United States District Court for the Southern District of Texas issued a decision upholding the legality of the CFPB Small Business Lending Rule (the “Rule”) (designed to implement section 1071 of the Dodd-Frank Act) in a lawsuit filed by plaintiff trade associations challenging the CFPB’s authority in promulgating the Rule (previously discussed here and here).
Continue Reading Federal Court Upholds CFPB’s Small Business Lending Rule
A biotech company recently settled with three AGs over allegations that it had failed to protect consumer information. According to the AGs of Connecticut, New York and New Jersey, this led to a 2023 data incident. The company, Enzo Biochem, agreed to pay a $4.5 million civil penalty and take several steps to modify its information security program.
Continue Reading Biotech Company Settles with Three State AGs Over Security Practices
Illinois recently updated its employment law, the Illinois Human Rights Act to prohibit discriminatory uses of AI. Artificial intelligence as defined by the amendment will cover generative artificial intelligence, not just traditional AI. The amendments are set to take effect on January 1, 2026.
Continue Reading Illinois Updates Employment Law to Address Artificial Intelligence
On August 2, New Hampshire passed House Bill 1243 (the “Bill”), which substantially amends its Motor Vehicle Retail Installment Sales Act (the “Act”). The Bill is effective as of August 2.
Continue Reading New Hampshire Updates Motor Vehicle Retail Installment Act: What Lenders Need to Know