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Alston & Bird Webinar Series: Coronavirus: What Does My Business Need to Know?

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Thursday, March 12, 2020  | 11:00am ET 
For Employers: Coronavirus and Travel: A Complicated Business Decision 

The 2019 novel coronavirus outbreak (also known as COVID-19) causes respiratory illness and can spread from person to person. There have been thousands of deaths reported globally, making the coronavirus deadlier than SARS. Coronavirus infections have been reported in dozens of countries. Individuals are being extracted from and departing China and the region, and pandemic fears have also affected shipping and travel around the world. Concerns about the coronavirus have closed factories and forced quarantines throughout China – delaying and even stopping manufacturing and deliveries.

The number of COVID-19 cases in the U.S continues to rise, affecting employers and employees in every industry, from hospitality to manufacturing to health care. What should employers consider in making decisions? This Alston & Bird webinar will review advice we are giving clients related to:

  • Travel, both foreign and domestic
  • Employee health precautions
  • Events and conferences
  • Office/workplace visitors
  • Remote workforce
  • Force majeure and the coronavirus

Our Speakers:

Dawnmarie Matlock regularly advises health care clients on complex regulatory issues, including Stark Law and AntiKickback compliance. She counsels clients facing government investigations and other enforcement actions to mitigate risks and help resolve active matters. She serves as Alston & Bird’s HIPAA privacy officer and counsels clients on HIPAA compliance and breach response.

Angie Burnette assists hospitals, physicians, and other providers with a variety of issues, including those involving medical staff, the National Practitioner Data Bank, mental health, surrogate births, minors, duty to warn, do-not-resuscitate orders, end-of-life issues, and refusal of blood transfusions. Angie provides general risk management and compliance advice to health care facilities, providers, and health plans. She also advises health care providers and non-health-care companies on HIPAA privacy, HIPAA security, and breach notification issues under the HITECH Act and state laws.

Christy Eikhoff will discuss force majeure in light of the coronavirus. She represents clients in significant and high-profile complex commercial litigation matters, with experience in manufacturing, media, and insurance. She is the co-chair of Alston & Bird’s Industrials & Manufacturing Litigation Team. She has handled several multimillion-dollar cases for publicly and privately held entities, with extensive experience in trial, arbitration hearings, mediation, written advocacy, settlement negotiations, and discovery management. Christy has been instrumental in helping business clients achieve resolution in litigated disputes involving claims of breach of contract, fraud, business torts, property torts, defamation, negligence, and unfair and deceptive trade practice and consumer protection statutes.

Charlie Morgan concentrates his practice in litigation and government and internal investigations, including occupational safety and health, employment and traditional labor matters. He represents Fortune 500 companies, retailers, manufacturers and privately held organizations across the U.S. in investigations and litigation involving accidents and safety issues, in class and collection actions, and in anti-union campaigns. He also develops programs and training initiatives for compliance with safety and health laws and federal sentencing guidelines.

Our Experience 

Alston & Bird has formed a working group to advise clients on the business and legal implications of the coronavirus. Our multidisciplinary team can assist and advise a broad range of economic sectors on responses to coronavirus news and proactive steps to ensure business continuity, supply-chain alternatives, data security if remote access for all employees is required, and new product development. We regularly work on coronavirus-related issues with the gamut of relevant regulatory bodies as well as congressional policymakers who are leading the response to this fast-moving event. Our team includes members with experience in regulations for employment issues, medical product development, and pharmaceuticals, as well as every type of business interruption scenario. Members of our team have previously worked for, or represent clients before, the White House, Congress, HHS—especially staff and operating divisions such as the Assistant Secretary for Preparedness and Response (ASPR) — FDA, CDC, USDA, EPA, DEA, DOD, SEC, DHS, DOS, and OSHA.

Webinar Details

Thursday, March 12, 2020

Login information will be provided to participants before the program.

Additional Programs 

Thursdays | 11:00 am ET  

March 19 – For Hospitals, Health Systems, Laboratories and Other Providers: Reimbursement issues, new codes, special employee issues, telemedicine, and how to navigate this new environment.

March 26 – For employers, health plan sponsors and insurers, hospitals, hospitality, and pharmaceutical and medical device manufacturers: What’s still pending on the legislative and regulatory front in response to the coronavirus pandemic.

CLE

These programs are provided as a complimentary service to clients and friends of Alston & Bird. CLE credit is pending for Georgia, Texas, California, New York, Pennsylvania, and Missouri. Additional states may be available upon request.

CLICK HERE TO RSVP

Why Consumer Finance Companies Should Hit “Delete” On Using Emojis In Business Communications

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A&B ABstract:  What does the increased use of emojis in business communications mean for consumer finance companies, and how can risks be mitigated?

Discussion

As emojis increasingly make their way into business communications, their use is creating unanticipated and problematic legal exposure for companies and their employees. Roughly 200 published court decisions since 2004 have grappled with emojis as evidence, and the number of these cases spiked as of 2017.  In business settings, these cases run the gamut from contract disputes to sexual harassment and discrimination.

The potential problems arising from workplace emoji use are particularly acute for consumer finance companies such as lenders and mortgage servicers, given the wide diversity of backgrounds among – and thus the greater potential for miscommunication with – their clients. The emoji trend shows no signs of slowing, and their legal complications in business communications will likely worsen absent common-sense safeguards.

Background on Emojis

Emojis, of course, are small picture characters used in emails and text messages. They integrate visual images into text, and they can expand depth and emotional content in ways that written words cannot. As explained by Professor Eric Goldman, , as of January 1, 2018, there were 2,600 emojis with codes under the Unicode Consortium. Countless more emojis are specific to different messaging platforms. Other related symbols are “emoticons,” which are letters, numbers, and other standard keyboard characters that are strung together to resemble a picture (e.g., the “smiley” emoticon – :-)). According to recent surveys, 92% of online participants use emojis, and 2.3 trillion mobile messages include emojis annually. They are ubiquitous and now common in business communications between colleagues and with clients in emails, texts, and instant messages, among other media.

The Problems With Emojis In Business Communications

The major problems with emojis involve their interpretation and meaning. If, as the saying goes, a picture is “worth a thousand words,” then so is each emoji. This reflects two major attributes of emojis that can lead to unintentional and profound misunderstandings in business communications with colleagues and clients.

First, different platforms translate and depict emojis differently. This means that an emoji sent via an iPhone may look quite different on an Android device, and vice versa. The same problem occurs with new versions of the same platform. Further, the sender and receiver have no easy way of knowing they are looking at symbols rendered differently across platforms, and they also do not necessarily even know that the emoji is being read on a different platform. All of this can lead to major misunderstandings. A classic example is the Unicode-coded emoji known as “grinning face with smiling eyes.” A 2016 survey revealed that most people thought the Android version meant “blissfully happy,” but thought the iPhone version meant “ready to fight.” The burgeoning field of emoji research reveals many similar examples. So a seemingly innocent email or text to a colleague or client that contains an emoji could inadvertently send an entirely different message than intended, solely based on technological issues beyond the participants’ control or knowledge.

Second, emojis often have multiple meanings that not all senders and recipients will mutually recognize. Indeed, Unicode Technical Standard #51 states a preference for adopting emojis with multiple meanings. Although this allows senders to convey many different concepts at once, it also raises the prospect of serious misunderstandings. The absence of any comprehensive and accepted emoji dictionary exacerbates this problem. The “folded hands” emoji, for example, can symbolize please, thank you, prayer, and a high-five – all very different meanings, with different implications. A 2016 survey showed that the iPhone “unamused face” emoji is variously interpreted as signaling disappointment, depression, being unimpressed, and being suspicious.

There may also be differences in emoji interpretation among different user groups, industries, and generations of users, all of whom may have their own idiosyncratic understandings of given emojis. This risk is heightened when corresponding with colleagues and clients from diverse groups that may not share a common background or frame of reference with the sender – a particularly acute issue for large client-facing organizations in the consumer finance industry.

Litigation Involving Emojis In Business Communications

Given the ubiquity of emojis, their use and interpretation have become fodder for the courts. Since 2008, U.S. courts in published decisions have addressed emojis in dozens of business cases involving breach of contract, employment discrimination, and sexual harassment.

For example, in Murdoch v. MedJet Assistance, an employee based claims of sexual harassment against her CEO on texts containing emojis with hearts and similar symbols, but her claims were dismissed in part because she responded with emojis that seemed receptive to his advances. Thus, emojis were important evidence for both sides in the case. In Apatoff v. Munich Re American Services (2014 U.S. Dist. LEXIS 106665 (D.N.J. 2014)), the court denied a company’s motion for summary judgment in a wrongful termination case because several managers’ emojis in internal emails discussing the termination suggested an improper motive, contrary to their deposition testimony.  These are but two examples of many similar cases.

Takeaways

Given the problems stemming from emoji use, companies in the consumer finance industry should consider implementing strict emoji-use policies. Because it is impossible to impose universally-accepted meanings on emojis among clients, colleagues, and other email or text counterparts, it may be most prudent to ban the use of emojis in employees’ business communications. The corporate IT department could also disable emojis on company systems.

Possible limited exceptions could be made for purely social communications with clients and colleagues. But the high risk of misunderstandings in a business context, which can give rise to disputes over contract formation, and potentially harassment or discrimination claims, seems to militate in favor of a bright-line rule against the use of emojis altogether. This may limit the spontaneity of business communication and make it more formal, but these downsides must be weighed against the real possibility of inadvertently forming (or breaching) contracts or other real consequences of emoji use. Another policy could require the insertion of disclaimers at the bottom of emails, expressly stating that emojis may form no part of any offer, acceptance, or agreement.

Unless and until the technology and societal understanding of emojis evolves further, the indeterminate meanings that can make emojis fun can also make them perilous in a business context. Companies must consider whether emojis are more trouble than they are worth.

Alston & Bird Adds Senior Consumer Finance Litigator in San Francisco Office

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Alston & Bird continues its Bay Area growth with the addition of senior litigator Jim McCabe as counsel. McCabe joins from Morrison & Foerster LLP, where he practiced for more than 30 years, most recently as senior of counsel.

“Jim is a top-notch litigator with an impeccable reputation for defending clients in high-stakes civil litigation before state and federal courts at the trial and appellate levels,” said Kristy Brown, Alston & Bird partner and co-leader of the firm’s Litigation & Trial Practice Group. “His track record as a trial and appellate lawyer and experience across a range of commercial and regulatory litigation, including complex class actions, make him a superb choice for clients seeking sophisticated guidance on matters critical to their success.”

In a career spanning more than three decades, McCabe has distinguished himself as a trusted adviser to corporate clients, primarily in the financial services industry.

Among his many notable successes, McCabe has defended financial services companies in more than 100 different class actions and other complex civil litigation encompassing consumer reports and consumer financial products.

Over the past decade, McCabe has represented LexisNexis – a subsidiary of RELX plc – in more than 40 individual disputes and 12 putative consumer class actions asserting claims under the Fair Credit Reporting Act. He also represented LinkedIn in defeating a putative class action that attempted to characterize the company as a consumer reporting agency. And for the Mortgage Bankers Association, he won summary judgment in a putative nationwide class action that challenged the issuance of multiple credit cards to subprime customers, serving as national coordinating counsel for the association and assisting lender defendants in defeating class certification in more than 60 cases asserting claims under the Real Estate Settlement Procedures Act.

In addition to his client work, McCabe has served as a trial skills instructor for the National Institute for Trial Advocacy and the Stanford University Advocacy Workshop.

“Jim brings exceptional litigation capabilities to our San Francisco office and broader financial services practice,” said Teresa Bonder, partner in charge of Alston & Bird’s San Francisco office. “His leadership, experience, and talent deepen our bench of leading litigators and provide another powerful advantage for our clients.”

Supreme Court to Decide CFPB’s Constitutionality

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A&B ABstract: On October 18, 2019, the Supreme Court granted certiorari in Seila Law v. CFPB to decide the constitutionality of the Consumer Financial Protection Bureau’s leadership structure.[1]  Significantly, the Court also ordered the parties to brief and argue a second question: “If the Consumer Financial Protection Bureau [“CFPB”] is found unconstitutional on the basis of the separation of powers, can 12 U.S.C. § 5491(c)(3) [which permits the President to remove the Director of the CFPB only for cause] be severed from the Dodd-Frank Act?”[2]

A decision on these two questions could significantly affect every financial institution or entity regulated by the CFPB.

The Constitutionality of the CFPB

In response to the 2008 financial crisis, Congress passed the Dodd-Frank Act, which included the Consumer Financial Protection Act (“CFPA”) and created, arguably, one of the most powerful federal agencies to have ever existed—the CFPB.[3]  This power emanates from the CFPB’s single director structure, the CFPB’s broad rulemaking and enforcement authority, and the fact that the CFPB’s Director is insulated from removal except for cause.  Since the CFPB’s inception, there have been numerous challenges to the constitutionality of what is known as the “for-cause” removal provision of the CFPA, which permits the President to remove the Director of the CFPB, not at will, but only “for inefficiency, neglect of duty, or malfeasance in office.”[4]  Challenges have been brought in courts in the Second, Third, Fifth, Ninth, Tenth, Eleventh, and D.C. Circuits.[5]

One of the most significant challenges to the CFPB’s constitutionality occurred before an en banc D.C. Circuit in PHH Corp. v. CFPB.  There, a majority of the D.C. Circuit held that the CFPB’s leadership structure was constitutional, reversing the three-judge-panel decision written by now-Justice Kavanaugh.[6]   Justice Kavanaugh then dissented from the en banc opinion that reversed the original decision. In his dissent, he again concluded that the CFPB’s leadership structure was unconstitutional because the Director’s power and authority were “massive in scope, concentrated in a single person, and unaccountable to the President.”[7]  It is unclear whether Justice Kavanaugh will choose to recuse himself in Seila Law, given that he has already ruled on the issue of the CFPB’s constitutionality in PHH Corp., though he is not required to do so.

One of the most recent challenges, and the one to be reviewed by the Supreme Court, was raised by the law firm Seila Law.  As explained in a previous post,[8] Seila Law involves Seila Law’s refusal to comply with a CFPB civil investigative demand (“CID”).  When the CFPB moved to enforce the CID in federal district court, Seila Law argued that the CFPB’s structure was unconstitutional and, as a result, the CID was unenforceable.  While the CFPB prevailed before the district court, and on appeal to the Ninth Circuit, with the argument that the CFPB’s leadership structure was constitutional, it has since asserted the new position that the for-cause removal provision is unconstitutional.[9]  The Supreme Court has now taken up Seila Law’s petition for certiorari.

The Severability Question

While Seila Law petitioned for certiorari on the issue of whether the CFPB’s leadership structure is unconstitutional, the obvious follow-up question is what happens as the remedy if it is.  That is, what happens if the Supreme Court strikes down the CFPA’s for-cause removal provision?  Recognizing this, when the Supreme Court granted certiorari in Seila Law, it sua sponte also ordered the parties to brief and argue the additional question of whether the for-cause removal provision is severable from the remainder of the CFPA, if the CFPB’s leadership structure is found unconstitutional on the basis of separation of powers.

This is significant because if the Court holds that the provision is not severable, it could strike down the entire CFPA, resulting in any number of drastic consequences.  For example, the Court could strip the CFPB of its enforcement powers or hold that all of the CFPB’s actions to date were ultra vires.  At least one amicus litigant in Seila Law has already made arguments to this end.  The State of Texas’s amicus brief on the certiorari issue took the position that the for-cause removal provision renders the CFPB unconstitutional and, as a result, there is no obligation for Seila Law to answer the CFPB’s CID.[10]

If the provision is found to be severable, then the CFPB likely would proceed with business as usual, even if its structure is held unconstitutional because the remedy would be to make the CFPB’s Director removable at the will of the President.  This is the position the CFPB has taken in recent statements agreeing that its leadership structure is unconstitutional.[11] The CFPB has largely relied on the fact that the Dodd-Frank Act contains a severability clause, which states that “[i]f any provision of this Act . . . is held to be unconstitutional, the remainder of this Act . . . shall not be affected thereby.”[12]  As such, the CFPB has stated that “a Supreme Court decision holding that the for-cause removal provision is unconstitutional should not affect the Bureau’s ability to carry out its important mission [of consumer protection],” because “if the Court holds the for-cause removal provision unconstitutional, the CFPA should remain ‘fully operative’ and the Bureau would ‘continue to function as before, just with a Director who ‘may be removed at will by the President.’”[13]

Notably, though it is unclear what position the Justices will take on the severability issue, Justice Kavanaugh’s original decision in PHH Corp., and his dissent in the en banc review, also touched on severability, finding that “[a]s to remedy . . . [t]he Supreme Court’s Free Enterprise Fund decision and the Court’s other severability precedents require that we sever the CFPB’s for-cause provision, so that the Director of the CFPB is supervised, directed, and removable at will by the President.”[14]

Takeaway

After years of litigation, and conflicting court decisions, the Supreme Court has finally agreed to take on the question of whether the CFPB’s leadership structure is unconstitutional and, if so, what the remedy should be.  That said, even if the CFPB’s leadership structure is found to be unconstitutional, at least one conservative Justice is already on record with the conclusion that the for-cause provision is severable (though Justice Kavanaugh could elect to recuse himself).  While the ultimate outcome is unclear, this case promises to be a major development in the arena of consumer finance and administrative law.

Seila Law will likely be scheduled for oral argument in early 2020, with a decision following in the coming summer.  For now, we will be monitoring the case for developments, including what arguments rise to the top during the briefing process.

[1] https://www.supremecourt.gov/search.aspx?filename=/docket/docketfiles/html/public/19-7.html (Oct. 18, 2019).
[2] Id.
[3] See 12 U.S.C. § 5491.
[4] See 12 U.S.C. § 5491(c)(3); see e.g., CFPB v. Nationwide Biweekly Admin., No. 18-15431 (9th Cir.); CFPB v. CashCall, Inc., No. 18-55479 (9th Cir.); CFPB v. All Am. Check Cashing, Inc., No. 18-90015 (5th Cir.); CFPB v. RD Legal Funding, LLC, No.18-2860 (2d Cir.); Community Fin. Servs. Assoc. v. CFPB, No. 1:18-cv-0295 (W.D. Tex.); CFPB v. Ocwen Fin. Corp., No. 9:17-cv-80495 (S.D. Fla.); BCFP v. Progrexion Mktg., Inc., 2:19-cv-00298 (D. Utah); CFPB v. Navient Corp., 3:17-cv-101 (M.D. Pa.).
[5] See CFPB v. Nationwide Biweekly Admin., No. 18-15431 (9th Cir.); CFPB v. CashCall, Inc., No. 18-55479 (9th Cir.); CFPB v. All Am. Check Cashing, Inc., No. 18-90015 (5th Cir.); CFPB v. RD Legal Funding, LLC, No.18-2860 (2d Cir.); Community Fin. Servs. Assoc. v. CFPB, No. 1:18-cv-0295 (W.D. Tex.); CFPB u. Ocwen Fin. Corp., No. 9:17-cv-80495 (S.D. Fla.); BCFP v. Progrexion Mktg., Inc., 2:19-cv-00298 (D. Utah); CFPB v. Navient Corp., 3:17-cv-101 (M.D. Pa.).
[6] PHH Corp. v. Consumer Fin. Prot. Bureau, 881 F.3d 75 (D.C. Cir. 2018) (en banc).
[7] PHH Corp., 881 F.3d 75, 166 (Kavanaugh, J., dissenting).
[8] https://www.alstonconsumerfinance.com/cfpb-changes-tack-on-for-cause-removal-provision/.
[9] See CFPB v. Seila Law, No. 19-7 (S. Ct. ), CFPB Br. on Pet. for Cert. (filed Sept. 17, 2019).
[10] See CFPB v. Seila Law, No. 19-7 (S. Ct.), Texas Amicus Br. on Pet. for Cert. at 16.
[11] See September 17, 2019 Letters from Director Kraninger to Speaker Pelosi and Majority Leader McConnell (quoting Free Enterprise Fund v. Public Co. Accounting Oversight Bd., 561 U.S. 477, 508 (2010)).
[12] See 12 USCS § 5302 (“If any provision of this Act, an amendment made by this Act, or the application of such provision or amendment to any person or circumstance is held to be unconstitutional, the remainder of this Act, the amendments made by this Act, and the application of the provisions of such to any person or circumstance shall not be affected thereby.”).
[13] See September 17, 2019 Letters from Director Kraninger to Speaker Pelosi and Majority Leader McConnell (quoting Free Enterprise Fund v. Public Co. Accounting Oversight Bd., 561 U.S. 477, 508 (2010)).
[14] PHH Corp., 881 F.3d 75, 167 (Kavanaugh, J., dissenting).