CCBJ May -June 2021

Corporate Counsel Business Journal May  June 2021

VOLUME 29, NUMBER 3

An Exciting New Era for Energy DANIEL LYNCH AND MATTHEW KAPINOS, PARTNERS WITH AKIN GUMP, DISCUSS WHAT THE FUTURE OF THIS RAPIDLY EVOLVING INDUSTRY HOLDS.

INSIDE

Maximizing Value,

Individually and as a Team

O'Carroll CLOCS Out

Managing Risk of Liability Stemming from Biometric Tech and Privacy Laws

Improving Diversity and Inclusion, in 2021 and Beyond

Putting Control in the Hands Of Legal Departments

AT THE HEART OF BUSINESS® Uncommon value for clients who shape our everyday lives.

ATLANTA CALIFORNIA CHICAGO DELAWARE INDIANA MICHIGAN MINNEAPOLIS NEW YORK OHIO RALEIGH SALT LAKE CITY TEXAS WASHINGTON, D.C. BTLAW.COM B

JANUARY • FEBRUARY 2021

In This Issue LAW BUSINESS MEDIA

Kristin Calve

EDITOR & PUBLISHER

Kimberly Fine

MANAGING DIRECTOR PROGRAMMING

Dylan Shepard

EDITORIAL ASSISTANT

AT THE TABLE . . . . . . . . . . . . . . . . . . . 2

Maximizing Value, Individually and as a Team

Kristin Calve

FRONT . . . . . . . . . . . . . . . . . . . . . . . . . 7

MAY  JUNE 2021 VOLUME 29, NUMBER 3

42 McAfee Cryptocurrency Team

Members Indicted for Pump

And Dump Schemes

Joshua Franklin

43 Staying Ahead of the

Artificial Intelligence Curve

Michael Portnov

Rachel Dwyer

GRAPHIC DESIGNER

Neil Signore

SVP & MANAGING DIRECTOR OF EVENTS

Lainie Geary

DIRECTOR OF CLIENT SERVICES

Amy Lemel

DIRECTOR OF CLIENT SERVICES

Jennifer Coniglio VP FOR EVENTS & SPECIAL PROJECTS

Matthew Tortora

SENIOR DATABASE MANAGER

Pat Hanelt

OFFICE ADMINISTRATOR

Rob Williams WRITER

Taylor Highbloom

PULSE . . . . . . . . . . . . . . . . . . . . . . . . .13

ENERGY . . . . . . . . . . . . . . . . . . . . . . . 45

13

45 An Exciting New Era for Energy

Daniel Lynch and Matthew Kapinos

Managing Risk of Liability Stemming from Biometric Tech And Privacy Laws Cort Malone, Robert Chesler, and James Goodridge

18 The COVID-19 Vaccine Rollout: What Employers Need to Know

Gary McLaughlin and Joshua Sekoski 24 DOJ’s Fraud Section Posts Opening for Full-Time CARES Act Prosecutor

Anthony Burba

49 Renewable Energy Remains on the Rise

Susan Bruce 52 Increasing Storage Capacity and to Match Increased Energy Creation

Brian Kelly, Michael Woodard

and Emilie McNally

OPS . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

25 Gaming Expansion Brings Newfound Opportunities for Virtual Vendors

Frank Donaghue and Jack Byrnes

57 Putting Control in the Hands

Of Legal Departments

29 2021 Global Regulator Report

Ari Kaplan and Stu Clarke

61 Using Data to Foster Innovation

Don Keller

SOCIAL MEDIA

POSTMASTER: Please send address changes to Corporate Counsel Business Journal, 104 Old Kings Hwy N., Darien, CT 06820; by emailing info@ccbjournal.com; or by calling 844-889-8822.

IDEAS . . . . . . . . . . . . . . . . . . . . . . . . . 33

CORPORATE COUNSEL BUSINESS JOURNAL (ISSN: 1073-3000), January/ February 2021, volume 29, number 1.

Published bimonthly by Law Business Media, 104 Old Kings Hwy N, Darien, CT 06820. Subscription price: $110 a year.

Periodical postage paid at Darien, CT, and additional mailing offices.

33 Reaping the Rewards of Bringing Trained Leaders to Your Organization

The material in this publication contains general information, is not intended to provide legal advice and should not be relied on to govern action in particular circumstances. The sources of material contained in this publication are responsible for such material, and any views or opinions expressed are solely those of the source.

38 Improving Diversity and

Inclusion, In 2021 and Beyond

Maureen O’Neill

Tim Chapman

Jess Hunt

63 Redefining In-House Counsel

As a Driver of Value

Ken Crutchfield

66 Pairing Incredibly Sharp Legal Minds with Brilliant Data Scientists

Wendell Jisa and Jay Leib

Kristin Calve At the Table

Maximizing Value, Individually and as a Team

 Edward Bibko, global general counsel with Kobre & Kim, discusses what he incorporates into his leadership style, and his search for team members who are engaged, challenge him and have a sense of humor.

CCBJ: What led you to your current role with Kobre & Kim? Edward Bibko: A recruiter contacted me, and it was simply too interesting an opportunity not to discuss.

Kobre & Kim is an innovative law firm that was doing all of the things I had decided law firms should be doing while I was in private practice. They have picked up on the things that I remember being huge frustrations. They are the “un-law firm” to some extent, because of their

Edward Bibko, Kobre & Kim

corporate approach. I thought it was a really interesting vision of the future of legal services – and that it would be a terrific opportunity.

I would say that both of those things influenced my

Tell us a bit about your leadership style and who or

leadership style. Having led a practice group, you

what has influenced it.

learn to be sensitive to what motivates people and to push internal initiatives forward. And being in private

I was in private practice for a very long time, and I was also the head of a practice group at a law firm. When you run a practice group, it’s not traditional management.

It’s more about providing direction and trying to inspire people and make them want to work together

practice for so long, I could really see the focus on greater productivity happening and the overall shift in the legal profession toward value as opposed to just billable hours. So in terms of my leadership style, I

on opportunities. Unusually, I didn’t go in-house until

incorporate things from both of those experiences. I try

about 20 years into my career. I was the European general

to articulate a clear to the people that work with me.

counsel at Jefferies, an investment bank.

And I very much try to delegate and trust people to make

2

MAY • JUNE 2021

the rest of my career. He is crystal clear and boils things

If you start looking at the profitability of everything, you miss how things work together as a whole.

down to the bare essence. Not only does that help provide direction, it underpins his gravitas. And then second, at my earlier job at Baker McKenzie, the global head of capital markets, Amar Budarapu, was the master of running a meeting. All of us have read leadership course

their own mistakes and to learn from them. I try to ask helpful questions and avoid micromanagement. But I do try to muck-in and do a portion of the day-to-day work alongside the team, which provides tremendous insight into the practical aspects of our work.

The thing that I’m most passionate about is focusing on value rather than time. Not every hour you spend in the day has the same value. I encourage everyone to look at what they do and to try to make their job into what

articles on how to manage and run meetings, but he’s one of the few people I’ve seen really do it well. It sounds simple, but it’s hard to do. He would set the agenda, set the tone, and very quietly, without people realizing he was doing it, firmly steer the discussion. At the end, we would end up with the best solution, and there was complete buy-in because everyone participated in the outcome. Only later would you realize that while Amar was the person who had probably spoken the least, his contributions had gotten us to where we needed to be.

He’s someone I try to emulate.

they want it to be. Continually examine what you do, decide where you’re adding value, and engineer out the

What qualities do you seek when hiring new people

frustrations that are taking up time and not adding value.

for your team?

Look for continuing improvement. I try to have a project management ethic in terms of sharing successes but also failures with others, so that we can learn as a team and debate how to do things better.

As for who influenced me, I would point to two people.

One is Mike Sharp, who’s the global general counsel

You need a core competency, of course. Beyond that, I look for people who are engaged – meaning that they won’t shy away from problems and buy into the idea of self-defining their role. The phrase I like to describe it is someone who “runs toward the cannon fire”. That’s really what I’m looking for. Someone who can find joy in what they’re doing, yes, but more than that. Someone who

at Jefferies and one of the best lawyers I’ve ever

would always be willing to challenge me if they thought

worked with. He has a concise and incredibly effective

what I was doing didn’t make sense. Oh, and a sense of

communication style, which I will struggle to emulate for

humor is hugely important.

CORPORATE COUNSEL BUSINESS JOURNAL

3

What’s the most valuable career advice you’ve received?

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I think back to my very first legal job: I was an intern at the New York State Office of the Attorney General, and the man who ran that office was pretty folksy. He would often say, “The world needs broad shoulders.” At first I didn’t really understand what he was getting at, but I’ve reflected on it many times over the years. I think it means different things at different stages of your career, but now I think about it in terms of being a leader, looking at things and identifying what need to be fixed and taking the responsibility of going out and fixing them, even if it’s not part of the job description. It’s not the most complex advice, but it’s stuck with me.

Are there any changes you’re hoping to see within the legal profession in the near future?

Looking back at my time in private practice, I’ve seen a huge evolution in law. And I think it’s gotten worse. In particular, there is too much overspecialization. Part of what is driving it, I think, is that in recent years there has been a craze to measure everything. And it has created a lot of bad behaviors. If you start looking at the

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profitability of everything, you miss how things work together as a whole.

The best way I can explain it is by talking about one of the deals I did a long time ago, which involved the Savoy

4

MAY • JUNE 2021

NETWORK The participants in the CCBJ Network demonstrate, through their many contributions, their unwavering commitment to the advancement and success of corporate law departments. The engagement and support of these “partners of corporate counsel” assure we continue to develop and distribute the news and information this unique and sophisticated audience relies on to meet the evolving legal and business needs of their organizations.

Strategic Partners American Arbitration Association

I encourage everyone to look at what they do and to try to make their job into what they want it to be.

Akin Gump Strauss Hauer & Feld LLP Barnes & Thornburg Clifford Chance H5 Jones Day

Hotel in London. As part of that, the hotel’s managers

McGuireWoods LLP

explained why the hotel had declined and how they

McNees Wallace & Nurick LLC

were fixing it. Essentially, the former managers started

National Association of Corporate Directors (NACD)

analyzing the profitability of everything. The shoeshine

Nuix

shop didn’t make a profit, so they got rid of that. The

Weil, Gotshal & Manges LLP

dry cleaning service didn’t make a profit, so they got rid of that. When they finished it was no longer a five-star hotel. Most modern law firms are like that – they’re really just a collection of solo practitioners who operate under a single brand and shared back-office resources. It’s very rare that I find a law firm that is truly collaborative and can work well together in bringing advice.

One of the things that I really like about Kobre & Kim is that they have identified these various points of frustration and built a law firm that addresses them. For instance, they rely heavily on really talented professional managers who focus on strategy and operations and all of the functions that need to be managed. It really makes for a better experience for everyone involved. 

Advisors Exterro Computershare FRONTEO FTI Consulting iDiscovery Solutions JAMS NAM (National Arbitration and Mediation) OpenText™ Discovery Wolters Kluwer’s ELM Solutions Wolters Kluwer’s Legal & Regulatory Zapproved

Contributors Anderson Kill Ipro Tech Cornerstone Research Logikcull Fish & Richardson Morae Global Herbert Smith Freehills Please help us improve and expand our services to corporate counsel by sharing your ideas with our publisher, Kristin Calve, at 844-889-8822 or kcalve@ccbjournal.com.

CORPORATE COUNSEL BUSINESS JOURNAL

5

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6

MAY • JUNE 2021

O’Carroll CLOCS Out

Front

Google Ops Leader Joins Hot Digital Contracts Startup In what she said was a “no-brainer” decision, Mary O’Carroll chucked not one but two legal dream jobs – head of legal ops at Google and president of CLOC – for her real dream job: chief community officer at digital contract unicorn, Ironclad. "I have often said that Ironclad is the only company that I would ever consider leaving my job at Google for," said O'Carroll, citing contracts as the “universal challenge” for legal professionals. “This is going to be the big answer to the question that we get from GCs all the time of how can GCs be viewed as a better strategic partner to the business." The new president of CLOC, which grew at a rapid pace during Mary O’Carroll O’Carroll’s tenure (see chart below), is Mike Haven, head of legal ops and associate GC for Intel. A former litigation partner with K&L Gates, Haven spent three years in Matt Fawcett’s legendary law department at NetApp, home of Connie Brenton, former CEO and board chair of CLOC. Ironclad is a well-funded operation with venture backers that include Sequoia Capital, Salesforce Ventures and Y Combinator. It was named last year to the Forbes list of fastest growing startups likely to reach a $1 billion valuation – which it may already have done. Just before announcing O’Carroll’s move, Ironclad announced the acquisition of leading clickwrap transaction platform, PactSafe, in a move to expand digital contracting to include acceptance of online transactions. That should help fuel O’Carroll’s drive for change. “I’ve always had this passion for the transformation of the business of law,” she said, “and I’m definitely not done with that.”

Legal Operations Growth

The proportion of legal departments with at least one legal ops professional has been on the rise since 2015.

46.7%

60.5%

48.6% 21.2% 2015

53.8%

42.9%

2016

2017

Source: The Association for Corporate Counsel (No data collected in 2019)

2018

2020

2021

CORPORATE COUNSEL BUSINESS JOURNAL

7

Briefly FOX News Media names Bernard T. Gugar as general counsel and executive vice president of Corporate Development.

McNees announces that Lauren Anthony and Elizabeth Smith have joined the firm’s Litigation Practice Group.

A study from Women’s World Banking finds that credit scoring AI systems employed by global financial service providers are likely to discriminate against women, excluding women from loans and other financial services.

Joinder Inc. announces the launch of their independent software platform for corporate legal departments to assist their control of all of their deadlines, tasks, and records.

McGuireWoods continues the strategic expansion of its nationally recognized M&A practice with the arrival of partner Brian L. Hager.

Hon. Randa M. Trapp (Ret.) joins JAMS in San Diego.

Morae Global Corporation announces the expansion of its executive team with the appointment of Sharon Sritong as CFO. Barnes & Thornburg adds new corporate, labor and employment, and litigation attorneys and legal professionals to its Chicago, Detroit Metro, New York, Indianapolis and Los Angeles offices.

Everlaw will host its first conference Everlaw Summit: Illuminate 2021.

Hillel Jacobson joins Weil in New York as a partner in their global Tax Practice.

8

MAY • JUNE 2021

From Barriers to Building Blocks The light at the end of the pandemic tunnel may just be a freight train barreling right for the legal profession, according to a major global survey of GCs and CEOs conducted by EY Law and Harvard Law’s Center on the Legal Profession in early 2021. Entitled “The General Counsel Imperative: How Do You Turn Barriers Into Building Blocks,” the survey paints a picture of an apocalyptic threat to the legal profession, according to David Wilkins, faculty director of the Harvard center. “There is a freight train coming down the tracks,” he says.

CEOs’ priorities for 2021 suggest that law departments will be under significant pressure to think and act differently for the foreseeable future, according to the survey report. While cost control is certainly on the agenda, maximizing the legal function’s value to the organization appears most important to CEOs. That implicates two areas: managing risk and leveraging ALSPs to meet mounting workloads.

Wilkins calls for inside and outside counsel to come together for a little détente before it’s too late to dodge the runaway train. “We need collaboration between legal departments and law firms, between legal departments and other providers, between law firms and other providers,” he says. “There's been a little bit of the Hatfields and the McCoys between law firms and in-house legal departments. They all say they love each other, but they don't.”

Most General Counsel are not very confident in their department's ability to manage complex legal risks % of General Counsel reporting confidence in department's ability to manage risk New privacy and disposition rules

18%

55%

22%

5%

Investigations

23%

58%

17%

2%

Major legal or regulatory changes

25%

49%

23%

3%

Brexit

62% Not Confident

27% Somewhat Confident

Confident

9%

2%

Very Confident

Where do you see opportunities for cost savings? % reporting strategy as offering significant or very significant cost savings opportunity

59%

Greater use of technology

38%

Insourcing tasks

33%

Optimizing Processes

26%

Using fewer providers Negotiating better rates

17%

The Big Shakeup As Law Firm Relationships Go Dark, Will Clients Benefit?

If the inaugural report is any indication, LegalVIEW Insights, a new series analyzing trends and issues from Wolters Kluwer’s ELM Solutions, which uses the world’s largest body of legal performance data, is worth keeping an eye on. Compiled by Nathan Cemenska, director of legal ops and industry insights for ELM, the data from 2020 show that lawyer-client relationships took a big hit. “Last year, a significant number of relationships between law firms and their clients went dark – not a single legal invoice was sent in these cases,” says Cemenska, who notes that 16% of relationships were put on hold for all of 2020, and 90% of law departments reduced their total number of active providers. “With the economy coming back, those gaps are going to be filled, but it won’t always be by the firms that lost the business.”

Median and Mean Number of External Providers, 2015-2020

Mean number of providers Median number of providers

250

Number of Providers

222

200

213

212

212

211 186

150 154

150.5

168

151

158.5 133

100 50

2015

2016

2017

2018

2020

2021

As a result, Cemenska believes we may see a “major reevaluation” of how the legal industry operates. “ALSPs, the Big Four, increased recognition of opportunities to insource, and the pause of 2020 may conspire to create appreciable change in sourcing patterns,” he says. But don’t count Big Law out just yet. “The truly sophisticated firms are sure to transform into opportunities what their less creative competitors can only see as threats,” he says. “Perhaps the most realistic view is that who succeed and who fails in this new world has less to do with what category you fall into – law firm, CLD, insourced team, ALSP, etc. – but whether you exceed category peers in your ability to see the world through new, post-pandemic eyes.”

U.S. Energy Development Corporation welcomes Josh Dazey and Cissy Shea as general counsel & corporate secretary and human resources manager respectively.

Gaurica Chacko, Michael Kleinmann and Rick van der Vegte join FTI in their health solutions practice as managing directors.

Onna welcomes Emoke Starr as their new vice president of people.

Weil advises Mudrick Capital Acquisition Corporation II in a pending $1.3B business combination with The Topps Company, Inc. Zapproved announces the release of their ZDiscovery platform to enable corporate legal teams to manage e-discovery more efficiently.

Morrison & Foerster represents American Airlines on financing aspects of a $10 billion senior secured notes offering and loan agreement.

Charlene MacDonald is appointed as FTI’s head of Healthcare & Life Sciences for the Americas in the Strategic Communications segment.

Thomson Reuters announces a partnership and integration of its indirect tax solutions with Armanino LLP in hopes to help businesses manage tax and compliance requirements.

Judge Ethan Greenberg joins Anderson Kill as a shareholder in New York.

Sidley Austin announces that Yvette Ostolaza has been elected to chair the firm’s Management Committee.

Consilio and Xact Data Discovery (XDD) agree to a merger of the two companies.

CORPORATE COUNSEL BUSINESS JOURNAL

9

Christopher Boyle joins Fisher Broyles’ Environmental, Health and Safety group as a partner in Philadelphia.

Required Reading Too busy to read it all? Try these books, blogs, webcasts, websites and other info resources curated by CCBJ especially for corporate counsel and legal ops professionals.

Akin Gump advises CEC Entertainment in $650 million private notes offering.

The Deloitte AI Institute collaborates with Chatterbox Labs to develop Model Insights technology for Trustworthy AI, a Deloitte-branded solution helping organizations address AI ethics.

Edward Bibko joins Kobre & Kim as global general counsel in London.

OpenText™ appoints Kristina Lengyel as executive vice president, customer solutions.

DLA Piper collaborates with Reveal to launch Aiscension, designed to find cartel risks within corporations.

Consilio released its Diversity & Inclusion 2020 Annual Report, the company’s second annual report on its D&I program.

Natasha Cooper, associate in McGuireWoods, joins the U.S. Attorney's Office for the Northern District of Georgia.

Clifford Chance announces that partners Gary Boss and Ashley Prebble have been appointed as coheads of the firm's Global Insurance Group.

Akin Gump advises Antara Capital in Innoviz Technologies Merger with Collective Growth Corporation.

SUBMIT YOUR ANNOUNCEMENTS TO editor@ccbjournal.com

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MAY • JUNE 2021

Website:

Dewey B Strategic Dewey B Strategic, named for Melville Dewey, inventor of the eponymous decimal classification system, was founded 10 years ago by Jean P. O’Grady, who has over 30 years of experience developing strategic information initiatives for Am Law 100 law firms. It’s tagline – “risk, value, strategy, innovation, knowledge and the legal profession” – would seem to cover the waterfront, but that would do a disservice to O’Grady. Her knowledge and interests are incredibly wide-ranging, which makes Dewey required reading. That’s especially the case when it comes to the 2020-21 Hits and Misses Survey, which asks responders what they bought in 2020 and what they plan to buy in 2021. COVID was certainly a challenge as a “gray literature” emerged that major publishers were not prepared to track. “It was ‘the year of the skunkworks’ for many librarians and knowledge managers, who scrambled to capture and analyze the torrent of local, state and national materials,” O’Grady writes. So what were the hot products? ALM Legal Radar, Casetext Compose, Bloomberg Law, HiQ, Lexis + and Westlaw Next, according to the survey. Check out Dewey for much more.

Newsletter:

Legal IT Insider (aka The Orange Rag) “The Future Is Bright,” reads the tagline of Legal IT Insider, “The Future Is The Orange Rag.” And, we might add, the present. A terrific UK-based global publication edited by Caroline Hill, a former solicitor with Norton Rose Fulbright, senior reporter at Legal Week and news editor at Legal Business who ditched her city lawyer career to follow her passion for writing. Thank goodness she never seems to have looked back. The Rag, which indeed is bright, is an invaluable source of news and information about the rapidly changing Legal IT ecosystem. Each of the 10 annual issues bustles with insight and imagination about everything from legal tech company M&A to new product development and deployment to expert commentary to significant moves among the legal technocracy to . . . well, you name it. When it comes to the Orange Rag, the future’s so bright, you gotta wear shades (hat tip Timbuk 3).

Thanks to the law firms, technology companies, alternative legal service providers, management consultants and other supporters of corporate law departments who share their insights and expertise through the CCBJ network. Your parti­cipation is appreciated.

Susan Bruce, member with McNees, regularly advises energy-intensive businesses and municipalities on energy and natural gas matters, including negotiating retail and wholesale energy contracts and supporting sustainability initiatives through physical and virtual power purchase agreements and onsite generation, including renewable and combined heat and power (CHP) energy projects. P. 49

Ken Crutchfield is the president and general manager of Wolters Kluwer Legal & Regulatory U.S. He leads the Legal Markets group and is responsible for setting the vision and strategic approach with a focus on developing leading digital products. His group aims to provide legal professionals across a wide range of markets with expert content and analysis and leading workflow solutions. P. 63

Anthony Burba, partner with Barnes & Thornburg, is a former federal prosecutor who focuses on defending corporate and individual clients against government investigations and resolving complex compliance matters. He is an advocate for his clients and relies on reasoned judgment and experience to assist his clients. P. 24

Frank Donaghue, a seasoned attorney and compliance professional, practices in the McNees Corporate & Tax and Gaming & Sports Wagering Practice Groups. Frank has extensive expertise in gaming, regulatory affairs, BSA/ AML compliance, consumer protection, workplace & government investigations, ethics hotline management, FCPA compliance and vendor due diligence. P. 25

Jack Byrnes practices in the McNees Corporate & Tax and Gaming & Sports Wagering Practice Groups. He counsels clients on commercial contracting, acquisitions and other general corporate matters. In addition, Jack counsels PGCB applicants through the various licensing, registration, and certification processes as well as compliance matters thereafter. P. 25

Joshua Franklin is an associate with Barnes & Thornburg. He is driven to create innovative solutions for his clients and their businesses when they encounter disputes, particularly those in the aviation, bankruptcy, financial regulation, insurance and tax arenas. P. 42

Tim Chapman is the Founder and CEO of TangoAlpha3. Under Tim’s leadership, TA3 is the evolution and successor to NorCal Staffing Group which was established in Silicon Valley in 2015. Tim began his career as a recruiter in 1997 and, prior to starting NorCal Staffing Group, served as an executive in the talent acquisition industry since 2009. P. 33 Robert Chesler is a shareholder in the Newark, NJ office of Anderson Kill P.C. He represents policyholders in a broad variety of insurance coverage claims and advises companies with respect to their insurance programs. P. 13 Stu Clarke is the Regional Director, Northern Europe for Nuix and is responsible for the design and delivery of eDiscovery, IG and forensic investigations solutions to our corporate clients, law firms, and ASPs across EMEA. P. 29

James Goodridge is an associate (pending admission) in the New York office of Anderson Kill P.C. He focuses his practice on corporate and commercial litigation, employment law and insurance recovery, exclusively on behalf of policyholders. P. 13 Jess Hunt is a member of Bodhala’s board of directors in New York. An experienced executive of high growth companies, she previously oversaw Andela’s worldwide operations including the revenue organization, operations, product & engineering and people. Prior to joining Andela, Ms. Hunt served as Executive Vice President at Axiom. P. 61 Wendell Jisa is CEO of Reveal, bringing 20 years of technology services and experience to the legal industry. As CEO, Wendell leads the international company with offices throughout North America and Europe. P. 66 Matthew Kapinos is a partner with Akin Gump. He guides energy and infrastructure clients through all phases of drafting and negotiating agreements for the purchase, sale, development and financing of energy infrastructure projects. He has represented midstream companies on joint ventures to develop oil pipelines and multiple clients in developing of LNG export and import facilities. P. 45

Ari Kaplan, founder of Ari Kaplan Advisors, is a leading industry analyst and the principal researcher for a variety of widely distributed benchmarking reports. He often speaks with students and professionals on how they can leverage technology and distinguish themselves in the downturn. P. 29

Gary McLaughlin is a partner with Akin Gump. He represents employers in employment and related matters in state and federal courts, and before administrative agencies. His practice includes extensive experience with wage and hour class action as well as other representation litigation. P. 18

Don Keller is the CEO and founder of Joinder, a SaaS engagement platform that provides a system of record for legal projects and files/documents.

Don spent his legal career at Orrick and Venture Law Group advising high growth technology companies, public companies, venture capital firms and investment banks. He has advised clients on more than 60 public offerings, 75 acquisition transactions and several hundred venture financings. P. 57

Emilie McNally is an associate with McGuireWoods in Richmond, Virginia.

She focuses her practice on advising buyers, sellers and developers on transactional and advisory matters in a broad range of energy-related projects and transactions. She has industry expertise in the renewable energy, power, and oil and gas sectors. P. 52

Brian J. Kelly, partner with McGuireWoods, leads the firm’s energy industry team. Based in Baltimore, he advises energy industry and financial clients on a wide range of transactions, including mergers and acquisitions, energy project and infrastructure development, project finance and structured commodity and hedging transactions. P. 52 Jay Leib is executive vice president, innovation & strategy with Reveal. In his role, he is responsible for Reveal platform’s innovation and strategy and tasked with accelerating the adoption of Reveal’s Brainspace and NexLP artificial intelligence technology. P. 66 Daniel Lynch is a partner with Akin Gump. His practice encompasses derivative transactions, project finance and development, battery storage agreements, energy marketing and trading, renewable energy and M&A. Dan represents clients in a wide range of energy projects, including developers, commercial users and energy marketers. P. 45 Cort Malone is a shareholder in the New York office of Anderson Kill P.C. He focuses his practice on insurance coverage litigation and dispute resolution, with an emphasis on commercial general liability insurance, directors and officers insurance, employment practices liability insurance, advertising injury insurance, and property insurance issues. P. 13

Maureen O’Neill is senior vice president and diversity & inclusion officer at Consilio. Maureen engages with Consilio's customers to ensure a best-in-class client experience. She works cross-functionally across the company to develop and deploy best practices that embed Consilio's commitment to service excellence, and to deliver the highest levels of quality and value. P. 38 Michael Portnov is a principal with Fish & Richardson. He focuses his practice on client counseling and preparing and prosecuting patent applications directed to computerrelated technologies. Mr. Portnov has significant patent experience working with inventions in the areas of machine learning and artificial intelligence. P. 43 Joshua Sekoski, counsel with Akin Gump, focuses his practice on labor and employment litigation and strategic advice for public and private companies, trade associations and investment funds. He represents clients in a variety of high-profile labor and employment matters. P. 18 Michael B. Woodard, partner with McGuireWoods, chairs the firm’s Mergers & Acquisitions and Energy Transactional Department. Based in Richmond, Virginia, he advises purchasers and sellers, both private and public companies, in stock and asset purchase and M&A transactions, as well as joint ventures and leveraged and management-sponsored buyouts. P. 52

CORPORATE COUNSEL BUSINESS JOURNAL

11

Pulse Managing Risk of Liability Stemming from Biometric Tech and Privacy Laws CORT MALONE, ROBERT CHESLER, AND JAMES GOODRIDGE ANDERSON KILL

 Using biometrics may increase efficiency, but companies that do so should also be careful to avoid – and insure against – liability.

Biometric technology is here, and its use will only continue to grow in the coming years. As a result, litigation under privacy laws protecting individuals’ biometric information has exploded. Such litigation will likewise continue to grow, as evidenced by the activity of the past few months.

In January, a group of New York state legislators introduced

In February and early March, four major developments occurred regarding BIPA litigation. First, a California District Court approved Facebook’s $650,000,000 biometrics settlement.

Second, the popular music video app Tik-Tok agreed to pay $92,000,000 in a biometrics settlement of BIPA claims, though approval of the settlement has been delayed until at least April 6, in light of claims that the settlement’s value is “embarrassingly low.” In re TikTok Inc. Consumer Privacy Litigation, 1:20-cv-04699, (N.D. Ill 2020).

of action similar to the already enacted Illinois Biometric

Third, Holiday Inn was sued in Illinois by its own insurance company for making a coverage claim for a biometric class action. AXIS Surplus Insurance Co. v. New Crown Holdings

Information Privacy Act (BIPA).

LLC, case number 2021CH00900.

a biometrics regulation bill that contains a private right

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The particular problem for companies in the use of biometrics

Biometric regulation centers on the individual’s right to control his or her personal information.

is exemplified by Illinois’ enactment of BIPA. Illinois is not the only state that regulates biometrics, but it is the only state currently whose biometric statute includes a private right of action. The penalty for a violation is $1,000, with an increase to $5,000 if the violation is reckless or

Fourth, on March 3, a college student initiated a class action

intentional. A plaintiff need not show any injury from the

against DePaul University over its use of facial-recognition

violation – just the violation itself. As a result of these

technology in online exam proctoring.

features, BIPA has made Illinois a center for biometric class action litigation.

The above are just a few examples of the burgeoning class of litigation over the use of biometrics. And as the

Biometric regulation centers on the individual’s right

New Crown case demonstrates, there will be additional

to control his or her personal information. Unlike a

litigation over the extent to which insurance covers these

stolen credit card or driver’s license, a person’s biometric

claims, particularly as more states ratify laws providing a

data cannot be simply canceled or replaced. Companies

private right of action for biometric privacy violations.

must advise individuals that they are collecting biometric information, indicate the length and purpose of the

Background on Biometrics

collection, and obtain the individual’s written consent to proceed with the collection. Certain covered entities

Biometrics is the use of personal identifiers such as

are prohibited from selling or profiting from the infor-

fingerprints and retina scans to identify people. These iden-

mation and must use reasonable standards of care in

tifiers are unique and reliable. A company may require its

safeguarding the information.

employees to check in and out with a fingerprint scan rather than a time clock. In Rosenbach v. Six Flags, 129 N.E.3d

Several Types of Insurance May Cover Biometric Claims

1197, 1205 (Ill. 2019), a Six Flags amusement park required a thumb print in order to obtain a season pass and was

In the face of liability for biometric claims, companies

sued for failing to meet the BIPA disclosure requirements

have turned to their insurance companies, only to be

described below. The technology continues to develop and

met by a solid wall of denial. The key insurance concept

expand. For example, the travel hub country Dubai is in

involved is invasion of privacy. Several different types

the process of rolling out an iris scanner that verifies one’s

of policies may provide invasion of privacy coverage,

identity and eliminates the need for any human interaction

including general liability, employment practices,

when entering or leaving the country.

directors and officers, and cyber.

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MAY • JUNE 2021

General Liability Insurance

policyholder sought coverage under a provision covering personal injury claims arising from the publication of

The Personal and Advertising Injury Coverage within

information that violates an individual’s privacy rights.

general liability policies includes coverage for invasions of

West Bend argued that “publication” required disclosure to

privacy. This insurance applies to “personal injury,” which typically is defined as “injury, other than ‘bodily injury,’ arising out of … [o]ral or written publication of material that violates a person’s right of privacy.”

West Bend Mutual Ins. Co. v. Krishna Schaumburg Tan, 2020 IL App (1st) 191834, appeal allowed, 154 N.E.3d 804

the public at large, not just to a single third-party vendor.

The appellate panel disagreed and found coverage. The case now sits before the Illinois Supreme Court, with a decision expected soon.

Employment Practices Liability Insurance

(Ill. 2020) is the only case so far construing this provision in the context of biometrics. In that case, a customer

Biometric measures regularly are used in various work

accused a salon of violating BIPA by storing and distributing

environments, and employees have filed biometric claims.

patrons’ fingerprint data without their consent. The

For example, the Salvation Army recently agreed to pay CORPORATE COUNSEL BUSINESS JOURNAL

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approximately $898,000 to settle a class action surrounding

the entity, directors and officers may be covered when

its practice of having its employees log their fingerprint

sued for failing to oversee operations that resulted in

when clocking in and out.

biometric violations.

Companies should have employment practices liability

Private company D&O policies also provide entity cov-

insurance (EPLI), which offers coverage for a broad range

erage that conceivably covers biometric claims. Thus,

of employment torts. Around 60 percent of existing EPLI

both public and private company policyholders should

policies provide coverage for invasion of privacy, which

investigate D&O coverage should they be faced with

should respond to biometric claims.

biometric claims.

Directors and Officers Insurance

Cyber Insurance

Biometric claims may trigger coverage under directors

A robust and properly designed cyber insurance policy

and officers (D&O) policies. While public company D&O

may afford the policyholder coverage for a BIPA complaint.

policies typically only cover securities claims against

Currently, there is not a standalone cyber policy specifically

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MAY • JUNE 2021

tion’s confidential or personal information, including

BIPA has made Illinois a center for biometric class action litigation.

patents, trade secrets, processing methods, customer lists, financial information, credit card information, health information or any other type of nonpublic information[.]” While a few biometric cases involve

designed to address BIPA claims. However, regulatory

disclosure – like West Bend and New Crown – most

fines and penalties, like those that could be issued under

chiefly implicate a failure to obtain consent, so these

BIPA, could potentially be covered in the Bermuda market using a manuscript fines and penalties policy form.

disclosure-based exclusions would not apply.

Policyholders should be aware of these exclusions as they

Exclusions

renew or place coverage, especially if they already use, or

The insurance industry has developed several exclusions for coverage related to liability for disclosure of person-

plan to use, biometrics. Because the use and regulation of biometrics is certain to increase in the coming months

ally identifying information, and it would not be sur-

and years, companies must evaluate their insurance poli-

prising to see more such exclusions going forward. For

cy options to ensure coverage for biometric claims. 

example, in West Bend, the insurance company sought to enforce its exclusion for claims resulting from the violation of statues or regulations that prohibit or limit the “sending, transmission, communicating or distribution of material or information.”

In New Crown, the general liability policy excluded coverage for damages arising from “[a]ny access to or disclosure of

Cort Malone is a shareholder in the New York office of Anderson Kill P.C. He focuses his practice on insurance coverage litigation and dispute resolution, with an emphasis on commercial general liability insurance, directors and officers insurance, employment practices liability insurance, advertising injury insurance, and property insurance issues. Reach him at cmalone@andersonkill.com.

Robert Chesler is a shareholder in the Newark, NJ office of Anderson Kill P.C. He represents policyholders in a broad variety of insurance coverage claims and advises companies with respect to their insurance programs. Reach him at rchesler@andersonkill.com.

James Goodridge is an associate (pending admission) in the New York office of Anderson Kill P.C. He focuses his practice on corporate and commercial litigation, employment law and insurance recovery, exclusively on behalf of policyholders. Reach him at jgoodridge@andersonkill.com.

any person’s or organizaCORPORATE COUNSEL BUSINESS JOURNAL

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The COVID-19 Vaccine Rollout: What Employers Need to Know GARY McLAUGHLIN AND JOSHUA SEKOSKI AKIN GUMP STRAUSS HAUER & FELD LLP How does the Americans with Disabilities Act apply

With the arrival of widespread vaccine eligibility and availability, employers should consider whether a vaccination policy is right for their workplaces. Such policies implicate a broad range of employment laws and regulations. Below, we address key questions about mandatory and voluntary vaccination policies, including discrimination, wage and hour, collective bargaining, and privacy considerations, and offer recommendations for employee vaccination programs.

Although we focus on federal law, employers should in all instances consider any applicable state and local laws and consult with experienced counsel.

to mandatory vaccination policies?

Under the Americans with Disabilities Act (ADA), employers may only conduct medical examinations on employees, or ask employees questions that are likely to elicit disability-related information, where the exams or questioning are “job-related and consistent with business necessity.” However, in guidance published in December 2020, the Equal Employment Opportunity Commission (EEOC) clarified that vaccine administration alone, or asking about or requiring proof of vaccination, is not a medical examination within the meaning of the ADA. Therefore, under the ADA, employers would

MANDATORY VACCINATIONS AND

generally be permitted to mandate vaccination.

DISCRIMINATION CONCERNS Still, complications may arise if an employer were to May employers require employees to get vaccinated

provide vaccinations on-site or otherwise contract with a

for COVID-19?

third party to administer vaccines (as opposed to merely requiring employees to get vaccinated without employer

Yes, subject to exceptions under antidiscrimination laws,

involvement). In order to obtain a vaccine, employees

though employers should monitor legislative and litigation

need to answer screening questions for “contraindications”

developments that could impact employer vaccination

(i.e., medical conditions that increase the risk of a serious

programs. At present, no laws expressly prohibit employers

adverse reaction). According to the EEOC, while the

from mandating COVID-19 vaccinations as a condition of

fact that somebody has been vaccinated is not a medical

employment, though bills having that effect have been pro-

inquiry, the pre-screening questions for obtaining the

posed in a number of states and a few states have issued

vaccine are. Therefore, if the employer is involved in ad-

executive orders restricting private entities’ ability to require

ministration of a mandatory vaccine, the employer must

proof of vaccination as a condition of providing services.

be able to show that mandatory vaccination is job-related

Additionally, at least one lawsuit has been filed challenging

and supported by business necessity. To satisfy this stan-

an employer vaccination mandate on public policy grounds

dard, the EEOC’s guidance states that the employer must

while COVID-19 vaccines are administered under an

have a “reasonable belief, based on objective evidence,

Emergency Use Authorization and not yet fully approved by

that an employee who does not answer the questions

the FDA. See Isaac Legaretta et al. v. Fernando Macias et al.,

and, therefore, does not receive a vaccination, will pose a

Case 2:21-cv-00179-MV-GBW (D.N.M. filed Feb. 28, 2021).

direct threat to the health or safety of [the employee] or

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How does the Pregnancy Discrimination Act apply to

Employers must engage in an interactive process with employees who claim that a disability prevents them from receiving the vaccine to explore accommodation alternatives.

vaccination of employees?

According to the CDC, pregnant individuals are at increased risk for severe illness from COVID-19, and there is limited data at this time about the safety of COVID-19 vaccines for people who are pregnant. The federal

others.” To assess the threat, employers should conduct

Pregnancy Discrimination Act (PDA) generally forbids

an individualized assessment of four factors: (1) the duration

discrimination based on pregnancy with respect to any

of the risk; (2) the nature and severity of the potential

aspect of employment. The PDA requires an employer to

harm; (3) the likelihood that the potential harm will

provide the same benefits of employment to pregnant

occur; and (4) the imminence of the potential harm.

employees that it provides to all other employees with

Additionally, an employer must engage in an interactive

similar abilities or inabilities to work. This means that

process with employees who claim that a disability prevents

an employer who grants accommodations from a vacci-

them from receiving the vaccine to explore accommodation

nation program to nonpregnant employees must either

alternatives. For example, remote work may serve as a

do so for pregnant employees or have a legitimate and

reasonable accommodation when a direct threat justifies

nondiscriminatory explanation for treating pregnant

excluding unvaccinated employees from the worksite.

employees differently.

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What if an employee objects to vaccination on religious

attractive that they have the effect of coercing an employee

or philosophical grounds?

into providing protected information. However, under the current administration, the EEOC’s proposed rule was

Title VII of the Civil Rights Act of 1964 prohibits discrimi-

withdrawn. The EEOC has announced that it expects to

nation based on religion. This protection includes requiring

provide updated guidance, but did not say when.

employers to accommodate an employee’s sincerely held religious (including theistic and non-theistic) beliefs,

If the employer is not involved in administering vaccines

practices or observances. Applying this standard, the

(directly or through a third party), then the EEOC’s wellness

EEOC’s guidance explains that an employee may be entitled

rule—if and when it is issued—likely would not come into

to a reasonable accommodation whereby the employee

play. Offering incentives for such vaccinations likely would

is excused from a mandatory vaccine requirement due to

not involve a “medical exam” or disability-related inquiry,

religious objections. However, the Title VII standard for

and thus would not implicate the ADA. However, the ADA

providing religious accommodations is not as demanding

requires employers to provide reasonable accommodations

as the ADA standard. Under Title VII, an employer need

that allow employees with disabilities to participate equally

not provide a religious accommodation if doing so would

in wellness initiatives. Therefore, the employer would still

require the employer to bear “more than a de minimis cost.”

need to engage in the ADA interactive process and provide

Costs to be considered include not only financial costs but

reasonable accommodations to the extent doing so would

also other burdens on the employer’s business. For example,

enable employees with disabilities to receive incentives

courts have found more than a de minimis cost where an

without causing an undue burden.

accommodation would impair workplace safety or cause coworkers to carry the accommodated employee’s share

Given the uncertainty in this area, employers are wise to

of potentially hazardous or burdensome work. Employers

be cautious with respect to vaccination incentives until

should consider whether any such cost could be mitigated

the EEOC publishes guidance. One potential option to

through alternative accommodations, such as remote work.

incentivize vaccination would be to offer paid time off to allow employees who choose to be vaccinated adequate

May employers offer employees incentives to get vaccinated?

time to make vaccination appointments, become vaccinated, and recover from potential side effects. Paid time

Yes, with limitations. Before the change in presidential

off reasonably offered to keep employees whole is likely

administration, the EEOC proposed regulations that

to be considered a de minimis incentive, and persons

interpreted a “voluntary” wellness program as a program

with disabilities who cannot get vaccinated for medical

where the employer offers no more than a de minimis

reasons would not need to devote time to making vacci-

incentive, such as a water bottle, to encourage employee

nation appointments, becoming vaccinated, or recovering

participation, reasoning that incentives cannot be so

from potential vaccine side effects.

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WAGE AND HOUR CONSIDERATIONS

or conditions” that an employee must meet (such as physical examinations, fingerprinting and drug testing), “time he

Are employees entitled to reimbursement for mileage or

or she spends traveling to and from the tests, waiting for

other transportation costs incurred in getting vaccinated?

and undergoing these tests, or meeting the requirements is

Generally, no, under federal law. Under the Fair Labor Standards Act (FLSA), employers are not generally required to reimburse employees for business expenses.

One exception is that an employer must reimburse nonexempt employees for the cost of “tools of the trade” provided by the employee if failure to do so would reduce pay below required minimum or overtime wages. However, trips for vaccination are generally isolated, infrequent events.

Therefore, even if obtaining a mandatory vaccination were deemed to be a work task, isolated use by an employee of his

probably hours worked.” Vaccination is arguably a “special requirement” that the DOL would treat similarly to drug testing if mandated. Additionally, if vaccination occurs on the employer’s premises at a time when the employee would otherwise be working, the DOL may view such time as compensable, even if vaccination is voluntary. Some state laws may require compensation in these circumstances as well.

By contrast, voluntary vaccination that occurs outside of normal working hours or away from the employer’s premises would not be compensable.

or her personal vehicle in getting vaccinated likely would not make the vehicle a “tool of the trade.” And such trips may not cause an employee’s wages to drop below minimum wage in any event. However, state law may require reimbursement where vaccination is mandated. Under either federal or state law, reimbursement likely would not be required for expenses incurred by employees getting vaccinated voluntarily.

Do employees need to be paid for time spent getting vaccinated?

Whether time spent by an employee getting vaccinated is compensable under the FLSA likely depends on when vaccination occurs and whether vaccination is mandatory. The U.S. Department of Labor (DOL) has not expressly opined on whether time spent getting vaccinated is compensable.

However, the DOL interprets the FLSA as requiring that,

Gary McLaughlin is a partner with Akin Gump. He represents employers in employment and related matters in state and federal courts, and before administrative agencies. His practice includes extensive experience with wage and hour class action as well as other representation litigation. Reach him at gmclaughlin@akingump.com.

Joshua Sekoski, counsel with Akin Gump, focuses his practice on labor and employment litigation and strategic advice for public and private companies, trade associations and investment funds. He represents clients in a variety of high-profile labor and employment matters. Reach him at jsekoski@akingump.com.

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Are employees entitled to time off because of an adverse

Must the value of vaccination incentives be included in

reaction to, or side effect of, a vaccine?

the regular rate when calculating overtime pay?

It depends. California’s COVID-19 supplemental paid sick

Probably not. The DOL has published guidance in which it

leave law now covers time spent recovering from vaccine side effects that prevent the employee from working. In the absence of a similar state or local law stating otherwise, if an employee becomes vaccinated voluntarily outside of the workplace without employer involvement, then an employee’s entitlement to paid or unpaid time off to recover from an adverse reaction or side effect would likely be treated as any other non-COVID-19 related illness for purposes of paid or unpaid time off. If, however, vaccination was mandated by or obtained at the direction of the employer,

takes the position that vaccination incentives are payments “in the nature of gifts for special occasions” that may be excluded from the regular rate.

COLLECTIVE BARGAINING CONSIDERATIONS Is a COVID-19 vaccination program subject to collective bargaining in a unionized workplace?

Probably. If employees are represented by a union, the NLRA requires their employer to bargain with the union over the

then an employee who needs time off from work to recover

terms and conditions of employment. Although the National

may be entitled to the same rights and protections as an

Labor Relations Board has not weighed in on COVID-19

employee injured on the job.

vaccination policies specifically, employers of unionized

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workforces have been required to bargain over similar

RECOMMENDATIONS FOR EMPLOYEE

policies, such as employer-subsidized flu vaccinations

VACCINATION PROGRAMS

and flu prevention. Thus, an employer in a union environment almost certainly would be required to bargain over a compulsory COVID-19 vaccination policy, unless the union has waived the duty to bargain. Yet even if the union waived bargaining over a mandatory vaccination program, the employer still may be required to provide the union notice and an opportunity to bargain over the effects of the program on employees, such as whether employees will receive time off to get the vaccine, who will administer the vaccine and consequences for employees who refuse the vaccine.

The complex interactions between federal, state and local laws—in combination with rapidly changing circumstances and the specific needs of each business’s workforce, customers and operations—necessitate that employers carefully consider potential vaccination programs in consultation with counsel.

The following are considerations and features that are generally advisable for COVID-19 vaccination programs: 1

Assess the potential impact of workforce vaccination on

your business. What impact would vaccination of your

workforce have on your operations? Would it enable

employees to work more safely and effectively? Would

certain worksites or positions benefit from vaccination

more than others?

2

Assess the potential reception to different policies

by your employees, customers, visitors, business

partners and the public.

does not apply to employers. However, HIPAA does apply to

3

Analyze the laws, regulations and orders applicable to

employer-sponsored group health plans, meaning employ-

your program to better understand your options and

ers may still need to contend with HIPAA. If vaccines are

obligations in implementing a program, including state

offered as a benefit through a group health plan, employees

and local laws applicable where your employees work.

4

Create a written policy. A written policy will help

ensure that employees understand the policy and that

the policy is applied consistently.

5

Create a process for educating employees about

the policy.

Once information about employee vaccination status is in

6

Invite feedback and receive, thoughtfully consider,

the employer’s possession, HIPAA no longer applies.

and appropriately address objections. 

PRIVACY ISSUES How does HIPAA apply to employee vaccinations?

Potentially. Authorization for use or disclosure of employee vaccination information may be required under the Health Insurance Portability and Accountability Act (HIPAA). HIPAA restricts use and disclosure of certain individually identifiable health information. It generally

should be asked to complete a HIPAA-compliant authorization permitting the plan to notify the employer that the employee has received the vaccine. Likewise, to the extent an employer contracts with a third-party health care provider to administer vaccines, employees must generally complete a HIPAA-compliant authorization to allow the provider to release information about vaccine status to the employer.

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DOJ’s Fraud Section Posts Opening for Full-Time CARES Act Prosecutor ANTHONY BURBA BARNES & THORNBURG This posting comes as the Fraud Section, in conjunction

Barnes & Thornburg partner, Anthony Burba, describes the DOJ’s continuous prosecution of fraud as it relates to the COVID-19 pandemic and the CARES Act.

with local U.S. Attorney’s Offices, continues to bring cases focused on fraud in the PPP loan program. These recent announcements of PPP related prosecutions note that the “Fraud Section leads the Department of Justice’s prosecution of fraud schemes that exploit the

The Department of Justice continues to signal its

CARES Act. In the Months since the CARES Act was

intense focus on deterring and prosecuting fraud in

passed, Fraud Section Attorneys have prosecuted more

connection with the COVID-19 pandemic and under the

than 100 defendants in more than 70 criminal cases.”

CARES Act specifically. In the latest sign of this commitment, the DOJ’s Fraud Section has posted a position for

The new announcement shows a continued commitment

a full time prosecutor located in the Major Frauds and

to CAF enforcement, and new threats to those that

Market Integrity Unit.

sought to profit off the government’s relief efforts targeting the pandemic. It is not yet clear whether this

The Fraud Section has even created a new acronym

position is earmarked for an existing Fraud Section

to cover CARES Act fraud, CAF. The posting indicates

prosecutor (as is often

that the newly created position will prosecute CAF.

the case with postings

“CAF prosecutors are a subset of prosecutors focused

this specific) or whether

upon investigating, prosecuting, and deterring fraud

they will seek expertise

in the Small Business Administration’s (SBA) COVID-19

from outside the section.

disaster relief programs, including the Economic

What is clear is that the

Injury Disaster Loan (EIDL) program and the Paycheck

DOJ’s commitment to

Protection Program (PPP).”

enforcement in this area is considerable, and we can

The new hire is expected to carry out the typical duties

expect that commitment

of a Fraud Section Trial Attorney as well as develop

to be met with additional

“expertise in detecting and prosecuting fraud in SBA

funding and resources

loan programs, and in SBA loan program rules and

that will likely result

regulations; and in bank fraud, wire fraud, wire fraud

in significantly more

affecting a financial institution, money laundering, false

prosecution of CAF

statements, obstruction, and conspiracy offenses.”

fraudsters. 

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Anthony Burba, partner with Barnes & Thornburg, is a former federal prosecutor who focuses on defending corporate and individual clients against government investigations and resolving complex compliance matters. He is an advocate for his clients and relies on reasoned judgment and experience to assist his clients. Reach him at Tony.Burba@btlaw.com.

Gaming Expansion Brings Newfound Opportunities for Virtual Vendors FRANK DONAGHUE AND JACK BYRNES McNEES WALLACE & NURICK LLC The PGCB requires licenses and certificates for various

As expanded gaming became legalized in Pennsylvania, video gaming terminals, iGaming and sports wagering saw incredible growth. Frank Donaghue and Jack Byrnes of McNees Wallace & Nurick provide their perspectives on the growth of these new areas.

forms of gaming, including slot machine licenses for casino land-based gaming, interactive gaming certificates for iGaming endeavors such as online slots and table games, sports waging certificates for land-based and online sports wagering, and terminal operator licenses for VGT operations. When entities with any of these various licenses and certificates engage third-party persons or

While it is common knowledge that the Pennsylvania

entities for goods and services, additional PGCB licensing

Gaming Control Board (the PGCB) regulates all legally

requirements may apply. These third-party vendors, also

operated casinos in Pennsylvania, it may come as a

known as gaming service providers, are natural persons

surprise that companies and individuals that are looking to provide goods and services to these casinos and licensed entities may also be subject to the same licensing requirements. The PGCB has a robust and heavily detailed application process and licensing system for entities and individuals

or entities that provide non-gaming goods or services to those entities that currently have, or are applying for, the above-mentioned licenses and certificates. Traditionally, the goods and services provided by these vendors were those typically associated with gaming establishments,

that wish to do business with PGCB licensed entities. For many years this was a forgone conclusion for traditional gaming vendors, who were aware of the detailed applications implemented by the PGCB. However, following the major expansion of gaming in 2017 in Pennsylvania, which saw the legalization of interactive gaming (iGaming), video gaming terminals at truck stops (VGTs), fantasy contests, and sports wagering, the pool of likely vendors who will end up conducting business with PGCB licensed entities grew significantly. Gone are the days of thinking of gaming entities solely as brick-and-mortar casinos serviced by the standard vendors – with the advent of new forms of gaming in the Commonwealth and beyond, more vendors and suppliers will need to ensure they have accurately completed the PGCB’s application process and are in compliance with all gaming licensing requirements. Therefore, the purpose of this article will be to outline these new areas of gaming and the likely new vendors who will be entering these new gaming frontiers – the new normal.

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Over the past few years, with the expanded field of virtual

The PGCB’s licensing requirements for vendors are based on the total dollar amount of business that is done with a gaming licensee or certificate holder.

gaming options in Pennsylvania, many more vendors who were not traditionally subject to PGCB licensing have now find they need to go through the rigorous application process in order to capitalize on a robust new marketplace. For example, since gaming can be achieved through

from construction contractors and transportation services, to cleaning services, security services, food distributors, and many more (the PGCB supplies a full list of currently approved registered vendors on their website). While the above-mentioned vendors may all be subject to PGCB regulations, several natural persons and entities are exempted from the gaming service provider registration

a variety of mobile devices, many vendors who specialize in location tracking are being utilized by gaming entities to ensure that all mobile wagers are made within state lines.

Similarly, there are new opportunities for vendors who offer tools that allow for gamers to track and set limits on their wagers, which both promotes responsible gaming and allows for accurate virtual records to be retained.

and certification requirements including public utilities, insurance companies, alcoholic beverage manufacturers

The proliferation of online sportsbooks and iGaming have

and suppliers that are regulated by the Liquor Control

also led to a boom in affiliate marketing arrangements

Board, shipping services, among others.

between PGCB licensees and virtual marketers, who, de-

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pending on whether they have a flat fee or profit-sharing

The PGCB’s licensing requirements for vendors are based

arrangement with the licensee, will need to be either reg-

on the total dollar amount of business that is done with

istered or certified with the PGCB. These affiliates, who

a gaming license or certificate holder. Should a vendor’s

often have sports or gaming related content as a center

total dollar amount of business with one or more gaming

point of their own business, such as gambling tips, sports

license holders be, or will become, greater than $100,000,

insights, and tracking wagering trends, can arrange pro-

but less than $500,000, within a consecutive 12-month

motional agreements with PGCB licensed entities that lead

period, the vendor will need to follow the necessary steps

to a profitable symbiotic relationship between the two

to become a Registered Gaming Service Provider. The

parties. These vendors, who, outside of purely affiliate/

application fee for a gaming service provider license is

promotional capacities, also offer services such as soft-

$500 for the vendor, along with $60 for each qualifier.

ware development and implementation, digital marketing

These qualifiers are individuals who are either: officers

and consulting, and sports data collection services, have

or directors of the applicant entity; an individual who has

been able to capitalize on an area of commerce that con-

direct or indirect ownership of 10 percent or more in the

tinues to evolve in both the legal and technological realms.

applicant entity; or a salesperson or other employee who

Indeed, this area has been so inundated with new develop-

is or will solicit business from, or have regular contact

ments that vendors will often need assistance of counsel

with, the applicant entity. Once registered, the vendor

just to determine the correct level and type of licensing

will need to pay a registration fee of $2,000 which will

they require– whether as a gaming service provider, sup-

allow the vendor to be registered with the PGCB for 4 years.

plier or manufacturer. Vendors should be aware that the PGCB always has the discretion to require licensure at a

Should a vendor’s total dollar amount of business with

higher level than may seem necessary at first glance.

one or more gaming license holders be, or will become, greater than $500,000 within a consecutive 12-month

Moreover, Kevin O’Toole, the executive director of

period, the vendor will need to follow the necessary steps

the PGCB, recently shared in March 2021 that they are

to become a Certified Gaming Service Provider. This

working toward implementing a regulatory framework

application process, in addition to being much more in-

that would allow for cashless funding sources in casinos,

depth and intensive, will involve a $2,500 application fee,

which would open a lucrative marketplace for mobile

and ultimately a $4,000 certification fee, which shall be

banking vendors offering cashless payment alternatives

valid for 4 years. In addition to these increased fees, the

for brick-and-mortar slot machine licensees. This incoming

vendors will need to provide:

innovation opens yet another door for vendors to partner with PGCB licensed entities in order to offer IT infrastructure

• A Gaming Service Provider Private Holding Company

that can support cashless payments, virtual wallets, and

Form for each affiliate, intermediary, subsidiary, holding

rewards cards, which are increasingly popular with

company or trust that has a 20 percent or greater direct

gaming consumers.

interest in the applicant. The fee is $500 per application.

CORPORATE COUNSEL BUSINESS JOURNAL

27

• A Personal History Disclosure Form for each owner,

opportunities for vendors who, prior to the expansion of

officer, and director and each salesperson who

gaming regulations over the past four years, were traditionally

solicits business from or has regular contact with

left out of the lucrative gaming industry. Today, these

any representative of a slot machine licensee or

vendors are coming mostly from the online and information

applicant. The fee is $1,000 per application. These

technology spheres and are quickly aligning themselves

certifications are valid for four years.

with the PGCB’s stringent and rigorous regulations in order to place themselves in prime position to capitalize

• A gaming employee application and disclosure

on a booming market. Although the process may be inten-

information form for any employee who will be performing

sive, noncompliance can often bring about much bigger

job duties in a restricted area or have any contact with

headaches than compliance for those wishing to explore

gaming equipment. The application fee is $350.

their options in the gaming industry, the gaming and sports wagering attorneys at McNees are ready to provide insight

• A non-gaming employee application and disclosure

into this complex registration and certification process. 

information form for any employee who will be performing job duties on the gaming floor but whose job duties do not require the employee to touch or have contact with gaming equipment other than exterior cleaning. The application fee is $60.

While the application process can be time consuming and intensive, failure to abide by these licensing guidelines may result in substantial fines and disciplinary actions for both the vendor and the licensee. In the past, the PGCB has levied individual fines in the hundreds of thousands of dollars against licensees that engaged in business with unregistered vendors. In these instances, it was immaterial whether the licensee or the vendor knew of their licensing requirement.

In conclusion, the gaming industry is continuing to evolve and adapt at breakneck speed along with the pace of technological advances. These advances are leading to 28

MAY • JUNE 2021

Frank Donaghue, a seasoned attorney and compliance professional, practices in the McNees Corporate & Tax and Gaming & Sports Wagering Practice Groups.

Frank has extensive expertise in gaming, regulatory affairs, BSA/AML compliance, consumer protection, workplace & government investigations, ethics hotline management, FCPA compliance and vendor due diligence. Reach him at fdonaghue@mcneeslaw.com.

Jack Byrnes practices in the McNees Corporate & Tax and Gaming & Sports Wagering Practice Groups. He counsels clients on commercial contracting, acquisitions and other general corporate matters. In addition, Jack counsels PGCB applicants through the various licensing, registration, and certification processes as well as compliance matters thereafter. Reach him at jbyrnes@mcneeslaw.com.

2021 Global Regulator Report ARI KAPLAN ARI KAPLAN ADVISORS

STU CLARKE NUIX

respondents highlighted a number of recurring themes.

Best practices for financial and competition regulators around the world.

The outlook for competition and financial services regulators is constantly evolving. To understand the key shifts, particularly during the COVID-19 pandemic, Nuix engaged Ari Kaplan Advisors to study the best practices for interacting with an array of financial and competition regulators around the world, as well as their preferred technology protocols, primary enforcement strategies, and data sharing preferences.

In fact, one regulator emphasized that the COVID-19 pandemic was raising an array of new concerns.

“COVID-19 has put more financial pressure on firms because it is very easy to do the right thing when things are going well, but it is much more difficult to do the right thing when things are going badly,” said a leader with a financial regulator in Europe.

EARLY INVESTIGATIVE ASSESSMENT After outlining the general parameters of the discussion,

Between March 20 and August 11, 2020 Ari Kaplan per-

many regulators also consider the severity of the matter and

sonally interviewed 31 regulators responsible for securities,

the unique nature of the case in developing their strategy.

financial services, and competition in 18 countries. Below

“In determining severity, we look at the amount of money

is a summary of the findings on the perception of

at issue, the number and type of victims, and whether

investigations, the composition of key regulatory teams,

the malfeasance is ongoing or stopped,” said a securities

the impact of technology, and impressions of enforcement.

regulator in North America.

COMMENCING AN INVESTIGATION

Third-Party Support is Rare, but Seemed

Complaints are Often the Catalyst For 42 percent of regulators surveyed, complaints were a prime gateway to an investigation. “Most work comes in due to complaints from a consumer or a market participant who loses money or has trouble getting money back,” said a securities regulator in North America.

to be Dictated by Country Size One-third (35 percent) of participating regulators indicated that adding third-party support such as outside counsel or external auditors was not common. “It is unusual to engage a third party to support an investigation,” said a financial regulator in South America. “Third parties are typically not involved,” concurred a leader focused on

SCOPING THE INVESTIGATION HAS COMMON STEPS

competition in the Asia-Pacific region.

When asked about how they established the depth,

bring on forensics support,” said an investigator with a

breadth, and gravity of key issues in advance, the

regulator in the Middle East.

That said, however, “On a large matter, we may look to

CORPORATE COUNSEL BUSINESS JOURNAL

29

“We only share specific information related to a discrete

COVID-19 has put more financial pressure on firms because it is very easy to do the right thing when things are going well, but it is much more difficult to do the right thing when things are going badly.

set of circumstances,” reported an IT leader with a regulator in Europe.

DATA COLLECTION Do you typically request all potentially relevant information at the outset or initially ask for narrow set of data and expand the scope as you proceed with you examination?

COMMUNICATION

ALL POTENTIALLY RELEVANT - 32% A NARROW SET OF DATA AND EXPAND - 52% BOTH - 10%

Most Regulators Do Not Provide Advanced

NOT APPLICABLE - 6%

Investigation Warning More than half (61 percent) of respondents reported they did not provide any warning before launching an inquiry. “The purpose of a dawn raid is to surprise the company and ensure that it does not destroy the evidence,” explained a competition leader in a European country that does not provide notice.

In some jurisdictions, however, notice is required.

“Usually, we notify the bank about two weeks in advance; if we want to sanction a bank, then the bank must be given an opportunity to defend itself,” said a leader with a banking authority in Europe. “We must inform businesses of an investigation before launching one,” added another regulator in that region.

INFORMATION SHARING IS TYPICALLY LIMITED A number of jurisdictions restrict the information that

There was a split among the participating regulators, with most (52 percent) requesting a narrow set of data and expanding the scope of their investigation as the inquiry evolved. “The regulated entities provide routine reports, but if we need to investigate further, we identify the additional information that would support a specific inquiry; we are typically not fishing or requesting a broad set of data,” explained a leader with a banking authority in Europe.

“We start with specific searches during the dawn raid and build it based on what we find in the early stages; we do not typically collect all the data at once,” added an investigator with a regulator in the same region.

EMPOWERING WITH MACHINE LEARNING Do you use analytics tools or predictive coding to assist in the review with prioritization or reducing volumes?

an agency can share. “We only share information with

YES - 42%

internal authorization as our investigations are confi-

NO - 55%

dential under our governing statute,” said a securities regulator in North America.

30

MAY • JUNE 2021

UNKNOWN - 3%

Two in five (42 percent) responding regulators use analytics tools or machine learning techniques such as predictive coding to assist with prioritizing their documents or reducing data volumes.

“It can connect individuals and entities with specific bank transactions and amounts; it also creates a visual picture of the relationships within the data,” said an IT leader with a regulator in Europe. “We would like to take advantage of Nuix predictive coding for picture classification for scanned documents and we are trying to use machine learning to classify documents,” said a competition leader in the same region.

FINES ARE THE PREFERRED FORM OF ENFORCEMENT Which type of enforcement do you typically prefer? [respondents could select more than one answer] FINE - 65% CHANGE IN CONDUCT - 52% COURT-ORDERED SUPERVISION - 3% INDEPENDENT THIRD-PARTY MONITOR - 6% MANDATORY EDUCATION & TRAINING PROGRAMS - 19%

Regulators are Leveraging Predictive Coding More than their Targets

UPDATES TO A RISK MANAGEMENT POLICY - 10% BINDING RECOMENDATIONS/UNDERTAKINGS - 19%

Who performs coding—you or the target?

PUBLICATION OF INFORMATION - 23% TEMPORARY WITHDRAWAL OF PERMISSIONS - 16%

THE REGULATOR - 29%

PUBLIC APOLOGY/STATEMENT - 10%

THE TARGET - 3% BOTH - 16% NEITHER - 39%

NONE - 3% NOT APPLICABLE - 19%

UNKNOWN - 13%

While almost half of the participating regulators reported using predictive coding, fewer knew if or suspected that their target companies were doing so. Some suggested that they were too small and others did not think they were sophisticated enough. “Neither the regulator, nor the target, typically have the technology to perform predictive coding,” said a leader focused on competition in Europe.

That said, the consensus was that its use was increasing. “It

While there are various enforcement options available to regulators, ranging from a public notice to a written warning, fines were the most appealing to the respondents.

“The most common type of enforcement is a fine,” said a compliance leader with a financial regulator in Africa.

“If we find something wrong, there will be a fine, but if there is harm to consumers, there is redress that requires more effort than a fine,” noted a leader with a financial regulator in Europe. Many also noted that deterrence

is widespread; while the smaller companies may not use it,

was a critical factor. “Education key so it is important to

the larger companies are using this technology to under-

educate the public to limit the number of victims through

stand their data,” noted a leader with a financial regulator.

education; also, the stronger the punishment, the longer CORPORATE COUNSEL BUSINESS JOURNAL

31

one would think about a particular scam,” said a leader with

Investigation Readiness

a securities regulator in North America. “Ultimately, the goal is to stop certain behavior,” advised a competition

As we looked ahead at the regulatory landscape, there was

leader in Europe. “The enforcement process is gradu-

extensive discussion about investigation readiness and its

al and the goal is to ensure compliance so if a warning

impact on future activities. The definitions ranged from bet-

promotes compliance, we prefer that approach,” said a

ter data mapping and improved remote access to increased

financial regulator in South America.

automation and effective data management.

2021 AND BEYOND

“You need to have investigation policies in place and know

Two key drivers of regulatory operations moving forward

country, and whether there are SLAs in place; investigative

are automation and investigation readiness. Both have

readiness requires compliance with the law and is about

the potential to streamline efficiency and effectiveness.

having the tools, people and infrastructure to execute pro-

where your data is, whether it is in the cloud and in the

actively,” said an investigator with a regulator in Africa.

Automation Do you automate repeatable steps that help you act and uncover critical data more quickly?

YES - 48% NO - 48% NOT APPLICABLE - 3%

“Data mapping and tools that allow data preservation on any device are critical to have in place,” added a regulator in Asia. Investigation readiness is particularly important in light of the pandemic.

“COVID-19 frauds are huge, for example; COVID-19 has had a huge impact as the majority of our employees are working remotely, with some back in the office at appropriate phys-

The respondents were evenly split on their efforts to automate key tasks. Most of the regulators that did not preset the activities felt that technology was not applicable to their core matters. “We probably could, but our work varies so much that we don’t have a sufficient number of repeatable functions,” said a leader with a financial regulator in Europe. Of those that do, their focus ranged from specific

ical distances so it has made a difference in how we work,” said a leader with a tax regulator in North America. One common theme in the Asia-Pacific region was that investigation readiness was “simply business as usual for us,” noted a financial regulator.

“We don’t really discuss investigation readiness because it is our core business and we feel that we are always inves-

eDiscovery tasks to digital forensics. “We automate dedu-

tigation ready; the expectation is that it is what we do and

plication, redaction for disclosure, tagging as irrelevant,

who we are,” added a leader focused on competition.

categorization, and the removal of system files,” said a securities regulator in North America.

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MAY • JUNE 2021

For more information, visit nuix.com/regulators-2021. 

Ideas Reaping the Rewards of Bringing Trained Leaders to Your Organization can expect from the VA in their post-military lives. The

Tim Chapman, CEO of TangoAlpha3, talks about the challenges military service members often have in adapting to civilian life, and the role companies can play in helping that transition be smooth and rewarding.

CCBJ: TangoAlpha3 has recently been named the beneficiary of the Veterans Affairs Transition Assistance Program (VA TAP). Please describe this program and how it works.

range of benefits is extensive, covering things like health care, home loans, education and benefits, etc.

Most of our employees on this particular contract are Veteran Administration benefits advisors. They’re the primary guides for the veterans coming out of the military and transitioning into the civilian world. In the period leading up to when a veteran gets close to transitioning out of the military, they’re required to go to a briefing that covers what they can expect from the Veteran Administration upon their exit. It’s a daylong affair, a high-level over-

Tim Chapman: Every member of the military that’s tran-

view of not only the benefits but also how to get access

sitioning to civilian life is required to attend a briefing.

to the benefits. Our benefits advisors conduct that initial

At that briefing, those servicemen and servicewomen are

training, in addition to the ongoing ad hoc training. For

provided with a high-level overview of the benefits they

example, If somebody left the service 25 years ago, for CORPORATE COUNSEL BUSINESS JOURNAL

33

instance, and wants to take advantage of a life insurance

As a veteran yourself, would you please describe the

policy that they had while they were service members,

strengths and weaknesses of the current state of

they can reach out to the benefits advisors and get

Veterans Affairs and employment?

information about how to access the benefits. They’ll be directed to whatever type of information they’re looking for. That ongoing support is just as important as the initial outreach because it reinforces the commitment that the United States and the VA have to our veterans.

It’s an extremely robust program and the advisors are true professionals. For our part, we serve the military installations located in the Southeast United States. We have about 50 senior benefits advisors and masters/trainers,

Public awareness and the value of hiring those who have served, is at a fairly high level these days. Many companies do a great job of incorporating veterans into their workforces and are reaping the rewards.

Hiring veterans is a logical strategy for companies that are looking for employees that have illustrated the “intangibles” we like to discuss when describing a person who has served in the military – trainable, disciplined, action-oriented, etc. However, we’ve found that a number

most of whom served in the military themselves, so they

of companies don’t know how to go about it. Skills trans-

understand what it’s like to transition out of the military.

lation, access to exiting servicemembers and assimilation

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MAY • JUNE 2021

making sure they have a roof over their head and meals

It’s one thing to hire a veteran; it’s another to hire a veteran and assimilate them into your organization.

every day and the best health care available, the best

are among the top challenges companies must solve in

One day, when a soldier, sailor, airman, Marine or Coastie de-

order to tap into the veteran talent pool. Employment for veterans is out there and TangoAlpha3 can help both veterans and employers seeking to hire veterans.

From a Veterans Affairs perspective, resources to assist Veterans in all aspects of their civilian lives have never been as robust as they are today. In 2019 The U.S. spent over $200 billion per year on VA expenditures versus spending just $50 billion prior to 9/11. That amount will be even more with legislation recently passed.

What is the scope of the economic or employment issues veterans face today?

Veterans who served after 9/11 have tended to face more readjustment challenges than those who served before 9/11. And naturally, servicemen and servicewomen who served in combat find the transition more difficult. Much of this stems from frustrations relating to employment and searching for jobs as a veteran. But, to my previous point, the resources are out there. There are so many

dental care, anything that’s necessary to support their family. It’s all part of an ecosystem that is uniquely military, driven by a sense of honor, discipline and duty.

cides that they want to get out of the military, that system goes away. It’s not just piecemeal. It’s not like they’re just losing a job.

They’re losing a job, their domicile – their access to guaranteed meals three times a day, etc. – to put it as basically as I possibly can. That transition is immense, and for veterans coming out, it’s really difficult – particularly among the enlisted ranks.

The good news is that there are companies that have longstanding veteran recruiting programs. And they understand how to embrace servicemen and servicewomen from a functional perspective – meaning training them for whatever their job in the civilian world might be, and also assimilating them into their organizations.

Whenever you talk about companies that are doing it right, that’s what they’re doing.

How does TangoAlpha3 support veterans?

It’s our mission to support Veterans. We primarily support veterans with direct jobs by matching their

organizations that are there to help veterans today.

experience with clients that need them. Aside for being

For obvious reasons, most civilians tend to not really

so we are extremely motivated to get as many veterans

understand what a veteran goes through. The military

to work as possible. We started out as a run-of-the-mill

spends hundreds of thousands of dollars, if not more, on

staffing and recruiting company, but our goal was that we

each solider, sailor, airman, Marine and Coastie to get

would grow to a point where we could focus our efforts

them trained in their occupational specialty. That includes

on assisting veterans and we’re doing just that.

a veteran-owned company, we are a for-profit company –

CORPORATE COUNSEL BUSINESS JOURNAL

35

Numerous companies will come to us and say, “We’re

veterans that we wish we could. With 200,000-plus veterans

looking for somebody to do this job, and we’d love to have

coming out every year, only a certain percentage of those

a veteran.” We make the introduction and provide that

folks are information-technology-centric. But there’s a

direct link to a job, including contract jobs. As a subcon-

whole world of qualified, functional, military-occupational

tractor on a couple of significant contracts supporting

specialties that apply to the civilian world.

the government, the Defense Health Agency being one of them, we provide veterans with jobs on a contract basis.

What are your hopes for the impact of your organization

And we provide support with the transition, because in

going forward?

some cases, they’re coming right out of the military, so we hold their hand a bit to help them get started with

We hope to continue to grow in both our mission to

their civilian life.

evangelize about the power the veteran workforce and, obviously, to grow our ability to serve our constituents

One of the other most exciting and impactful ways that

through direct business – the more companies we can

we support our veterans is evangelizing and teaching

engage, the more veterans we can put to work. We aim

companies how to set up veteran recruiting programs so

to continue helping companies that are looking for this

that they can go out and hire veterans on their own. We

high-powered veteran workforce, and us being able to

need to do that because our scope is relatively limited.

make those introductions. To see a company embrace a

We’re primarily an information technology services

veteran recruiting strategy in their talent acquisition

company. So there’s no way we can employ all of the

goals, feels good from a moral perspective – but also, we

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MAY • JUNE 2021

unless somebody interjects. That could be as easy as saying

If you give them the tools and training they need to get the job done, they will get it done.

hello, asking them how they’re doing, engaging with them on a personal level.

It’s very easy, as an individual, to just walk up and say, “Hello” and “Thank you for your service.” Many veterans will blush

know it’s the right thing to do because the benefits flow. The company gets the benefit of a high-octane worker. And the veteran gets the benefit of being able to provide for themselves and their families, and to progress in their career.

There are a couple of other things that I’d like to mention that are common themes within the military that are sometimes overlooked. It’s very hard to have a conversation with somebody who has been in the military and not talk about leadership. I can’t imagine a better, more robust

when you say “thank you for your service” because, as I can tell you from my own perspective, the military gave me way more than I gave it. I consider it a huge honor to be able to serve. That conversation can go a long way.

For corporations, it’s just like anything else. You get out what you put into it. Understand that if you’re looking for a workforce that will serve and move your company forward in the long term, it’s going to require an investment.

The initial investment is easy, understanding how their military experience translates into your civilian needs, in

leadership training institution than the U.S. military.

terms of the jobs they will

Everybody who enters those doors is expected to progress

be performing. But also in

in their function and job duties as well as their leadership

assimilation. In under-

capabilities. That’s one thing. The other is that for people in

standing that there is a

the military, training is never-ending. Training is something

learning curve. There is an

that is embedded in the DNA of every soldier, sailor, airman,

adjustment period from the

Marine and Coastie. If there’s one thing we can do to impact

time one gets out of the mil-

our organization or other organizations, it’s to continue to

itary to the time that one

evangelize those characteristics and attributes.

gets settled as a civilian.

Sometimes it can be quick.

How can corporate organizations or individuals support

Sometimes it can be a bit

the success of veterans?

longer. But military folks, these men and women, love

Veteran suicide and homelessness is a really big issue

a challenge. They will get it

right now and we have to figure it out. The latest statistics

done. If you give them the

are that 22 service members per day take their own life.

tools and training they need

In many cases, we find out after the fact that someone

to get the job done, they

might set out on their day and find a way to end their life

will get it done. 

Tim Chapman is the Founder and CEO of TangoAlpha3. Under Tim’s leadership, TA3 is the evolution and successor to NorCal Staffing Group which was established in Silicon Valley in 2015. Tim began his career as a recruiter in 1997 and, prior to starting NorCal Staffing Group, served as an executive in the talent acquisition industry since 2009.

Reach him at tim@tangoalpha3.com.

CORPORATE COUNSEL BUSINESS JOURNAL

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Improving Diversity and Inclusion, in 2021 and Beyond

We didn’t believe that was happening as much as it should,

Maureen O’Neill, a longtime advocate for diversity and inclusion within the legal profession and a member of Consilio’s D&I leadership team, has recently stepped up as their D&I officer. Here she discusses how their organization measures up and the initiatives the organization has underway to ensure continuous improvement.

and we hoped that by publishing these annual reports, we could help foster change. That’s really what inspired us to go public with these reports and metrics and survey results – that interest in transparency. I believe that in large part we have achieved what we hoped to. We are beginning to hear more and more talk about these issues. We are inspiring some candid and productive conversations.

CCBJ: Consilio recently released its second annual D&I report. What inspired the firm to conduct the initial survey, and what is the organization is hoping to achieve with it?

Maureen O’Neill: One of the first decisions that our D&I leadership team made when we began to put this structure around our work was that we were going to be transparent with our efforts. We wanted to hold ourselves accountable, and in order to do that, we wanted to let our employees,

The survey findings explain key initiatives undertaken in 2020 and detail performance against goals. Among these goals is the development of affinity groups. Please talk about that concept and your organization’s plans to design and maintain these groups.

In our view, the creation of employee affinity groups is a key element of our programming around inclusivity, and

our clients, and the market as a whole know what our goals

by creating these affinity organizations, we create safe

and objectives were. We also hoped to encourage conversa-

spaces for employees who share things in common to be

tion about these issues within our industry.

able to talk about issues, share ideas, and discuss their

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MAY • JUNE 2021

interest and support from our employees around the world,

We are planning to continue our efforts to get more of our employees to self-identify their diversity characteristics.

hosting a series of well attended meetings that created some thought-provoking and innovative programming.

We continued to work to form more of these affinity groups throughout 2020. We formed one for employees who are interested in multicultural issues, called MC-LITE. We also

experiences. Coming out of 2019 and into 2020, this was high on our list of things that we wanted to achieve in 2020 – the formation of that first set of employee affinity groups.

That work got underway in the first few months of 2020, and then of course the world turned upside down in March, and Consilio went to a 100 percent remote workforce almost overnight. When that happened, our D&I leadership team realized that we needed to accelerate the work around the formation of the employee affinity groups.

With all of us working at home and not being able to be together in person, not being able to share a coffee or lunch or cocktails after work, not having those in-person interactions with our mentors and allies, we needed to have these groups up and running so that we could have

began the process of creating two additional groups, a women’s group and a group for employees interested in health and wellness. Those groups began being formed in 2020, and now they are fully launched and underway.

Another key initiative was to expand your recruiting pool of diverse applicants, a goal shared by many in the legal community. Please describe how Consilio approached this.

There are two key aspects to that process. First, we made an investment in a new human resources recruiting software platform. With that new platform, we are able to tap into recruiting sources around the United States that we weren’t able to in the past. These are state-by-state resources – community job boards, state-run employment

those safe spaces in the virtual world instead.

agencies, job-seekers’ support groups, etc. By being able

We formed these groups by soliciting opinions from our

to access a much more diverse pool of applicants than we

employees. We put out a survey, polling folks on which groups they would be interested in, and we used the results to prioritize which groups to form first. This work was underway by April and May of 2020, and as we went into the summer of 2020, we saw the terrible things going on with respect to racial injustice and the escalation of the Black

to post our job openings with these sources, we are able had with our traditional recruiting sources. In the past, we used the same sources that many in the legal industry do, like LinkedIn and Indeed, but now we are finding that by accessing these other sources, we’re seeing a whole different pool of applicants – folks who may not have traditionally thought about working in legal tech.

Lives Matter protests around the United States. We decided that we needed to make the formation of our Black employees

The second aspect of this really came out of the pandemic

affinity group the top priority. The group we formed is

and switching to a work-from-home model, and it relates

called BRAG, which stands for Black Responsiveness Affinity

in particular to the recruiting pools for our document

Group, and it was a huge success. It garnered tremendous

review workforce. We have moved all of those reviewers CORPORATE COUNSEL BUSINESS JOURNAL

39

to a remote model, to what we call our Secure Virtual

list of things that I wanted to accomplish in 2021. But just

Review platform, or SVR. By enabling reviewers to work

as quickly, I realized that I was going to need some help,

from home through the SVR arrangement, we have found

that it was time for us to expand our leadership team

that we are tapping into document reviewers we couldn’t

further and create some additional roles to help us carry

have used in the past. These are people who, for whatever

out these ambitious projects.

reason, aren’t able to come to a traditional brick-andmortar review center, or they have constraints on the

To do that, we added two new positions, which we call

hours of the day they can work. In this new environment,

program leads. Our program lead for workplace diversity

those concerns disappear.

is Nicola Mason. She’s based in our London office, in our Human Resources organization. She has a background in

We understand you’ve made some key hires to support

the HR aspects of diversity and inclusion, and in partic-

these ongoing efforts. Please share a bit about these

ular, the collection and analysis of diversity data about

new colleagues.

applicants and employees – the analysis of applicant flow and the analysis of promotion activity and so forth. Nicola

When I was approached about taking on the role of our

is going to help us continue to improve our collection

Diversity and Inclusion Officer, I was honored and excited

of diversity dimension data and help us craft more

and accepted immediately, and I quickly got to work on a

sophisticated analyses of that data.

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MAY • JUNE 2021

better, so we are planning to roll out a similar effort this

By being transparent, we are bringing more awareness to these issues.

year – a survey of our employees asking them to please consider voluntarily self-identifying these dimensions.

Once those data collection goals are accomplished, we

Our new program lead for workplace inclusion is James Edwell. He’s based in Pittsburgh, in our Global Sales Organization. James and I have worked together for a long time. We were both at DiscoverReady prior to Consilio, so I knew when James stepped up and expressed interest in this role, he would be a great fit. He is focused on ways that we can continue to build a culture of inclusivity at Consilio.

will engage in more sophisticated analyses of our data. In the past, we have done these analyses at a fairly high-level aggregated basis. Part of why we haven’t stratified our analyses more than we have is that we haven’t had enough data. But the more data we have, the better able we are to carry out more granular analyses. So in 2021, we want to start performing analyses, for instance, by function or by geography or by seniority level. We’re devoting significant attention to that this year.

Those are the two new appointments for program leads.

Also, within the last month, we onboarded our new chief

And finally, we will create a Supplier Diversity Program.

employee experience officer, Brandyn Payne. She has

We want to make sure

extensive experience in the D&I space, and she’s going to

that what Consilio spends

be a really valuable partner to the D&I leadership in terms

with external partners

of executing on our plans and ideas for 2021.

and providers and ven-

What are the key goals Consilio has identified for 2021?

We’re going to continue to expand our employee affinity group program. Another goal is maintaining our more generalized efforts around inclusion and keeping up our culture of inclusivity, especially as we continue working from home.

We are planning to renew our efforts to get more of our employees to self-identify their diversity characteristics.

One of the things we accomplished in 2020 was a survey of all of our employees, asking them on a voluntary basis

dors includes diverse organizations. So, for instance, in the same way that a corporate legal department expects its outside law firms to staff its matters with diverse lawyers, Consilio would like to see that from its providers. We are working to understand what that

to self-identify those characteristics, so that we could get

program will look like for

a more complete picture of who we are as a company. We

us, and then we hope to

had good results from that, but there’s still room to do

get it underway soon. 

Maureen O'Neill is senior vice president and diversity & inclusion officer at Consilio. Maureen engages with Consilio's customers to ensure a best-in-class client experience.

She works cross-functionally across the company to develop and deploy best practices that embed Consilio's commitment to service excellence, and to deliver the highest levels of quality and value. Reach her at maureen.oneill@consilio.com.

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McAfee Cryptocurrency Team Members Indicted for Pump and Dump Schemes JOSHUA FRANKLIN BARNES & THORNBURG media platforms to post misleading statements regarding

Joshua Franklin, associate with Barnes & Thornburg, details the unsealed indictment charging of John McAfee, founder of McAfee antivirus software company, regarding wire fraud and money laundering with his cryptocurrency team advisor, Jimmy Watson.

initial coin offerings, cryptocurrencies to purchase, and other schemes to induce investors into purchasing these assets. The alleged scheme earned the team more than $13 million in profits.

Small digital assets—like penny stocks—are particularly susceptible to price moves from fraudulent activity. They

On March 5, 2021, the U.S. District Court for the Southern District of New York unsealed an indictment charging John McAfee, the founder of McAfee antivirus software company, along with the executive advisor of his cryptocurrency team, Jimmy Watson Jr. The pair face charges on seven counts including wire fraud, money laundering, and conspiracy to commit commodities and

are thinly traded, their holdings are largely anonymous, and there is enough market excitement about cryptocurrency that well placed statement, especially by celebrities, can cause sufficient market activity to move prices quickly. Combining that with a social media platform that reaches thousands of potential market participants quickly and efficiently and you have the makings of what

securities fraud by touting and scalping. Watson had

the Department of Justice has called “an age-old

been arrested in Texas the night before the indictment

pump-and-dump scheme.”

was announced, and McAfee remains detained in Spain awaiting extradition to the United States on tax fraud charges filed in October 2020.

The indictment claims that McAfee and his team were involved in a number of fraudulent schemes including touting various cryptocurrencies over Twitter through false statements and then withdrawing profits after those statements caused the assets to increase in value. In many of these situations, McAfee had been compensated to endorse the cryptocurrencies, but his public statements did not mention this fact.

The indictment alleges that McAfee and his team were aware of their obligations to disclose their compensation.

After bloggers made mention of his obligations, McAfee

The U.S. Government, including the Securities and Exchange Commission (SEC) and the Commodities Futures Trading Commission, have warned investors about these schemes through documents such as The DAO Report and the SEC FinHub website, particularly with respect to celebrities. We will continue to monitor Commodity Futures Trading

and his team used pseudonymous accounts to continue

Commission v. McAfee et al.

the activity. From December 2017 through October 2018,

and U.S.A v. McAfee et al.

the complaint alleges McAfee and Watson used social

as they develop. 

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MAY • JUNE 2021

Joshua Franklin is an associate with Barnes & Thornburg. He is driven to create innovative solutions for his clients and their businesses when they encounter disputes, particularly those in the aviation, bankruptcy, financial regulation, insurance and tax arenas. Reach him at joshua.franklin@btlaw.com.

Staying Ahead of the Artificial Intelligence Curve

of my practice. Now my practice is almost 100 percent

Michael Portnov, principal with Fish & Richardson, talks about the future of AI and how his degrees in mathematics and physics help to inform his practice in the high-tech patent world.

devoted to the software and hardware aspects of AI.

CCBJ: How did you get involved in artificial

In the early days, the curve of development was astounding.

What changes have you noticed in the industry over the years?

intelligence (AI) patent work?

Each new invention seemed like it was leaps and bounds

Michael Portnov: I’ve been working with AI and machine

development is still significant, the improvements are

learning technologies for about eight years now. When I started, “deep learning” was just emerging as a viable technology, and it landed on my plate because of my academic background. Basically, I was able to wrap my head around the math behind it. As deep learning became more and more ubiquitous in the space, with the proliferation of graphics processing units (GPUs) and other hardware

ahead of what was previously state of the art. While smaller and more incremental now. Many inventions that I look at are not necessarily coming up with entirely new paradigms to solve problems so much as they are refining or expanding existing ideas.

What industry challenges do you see consistently?

that can accelerate the training of these deep neural

One of the major challenges for AI companies is finding

networks, AI patent work became a larger and larger part

commercial and industrial applications for the technologies

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43

to be able to get. But, of course, more prior art means that

Most new AI technologies are not core aspects of current products, but they will be in five to 10 years, so companies need to be able to think long-term.

it is more likely that my invention will face difficulties in front of the patent office.

Where do you see this industry going in the next five to 10 years?

being developed. Researchers generally don’t think about commercial applications for the AI they are developing, so patent attorneys are in the unique position of being able to help clients envision what kinds of products or services these technologies could be used for in the future. Most new AI technologies are not core aspects of current products, but they will be in five to 10 years, so companies need to be able to think long-term.

What issues do you face when prosecuting patent applications for AI-based inventions?

As computing power becomes more readily available and techniques to make AI more suitable for commercial uses develop, AI will become more pervasive across almost every industry. Many of the products on the market now are several years behind the research, so we’re going to see much more advanced forms of AI being implemented across a wider range of industries in the future. I think there will also be a democratization of sorts for working with AI; products are currently being developed that will help people who don’t have backgrounds

Like most software inventions, AI-based inventions face

in AI be able to train and

patent eligibility issues. A large part of my work is figuring

deploy their own models,

out which kinds of AI innovations are patent eligible and

which likely will have an

then framing them in such a way as to be treated favorably

amplifying effect on the

by patent offices around the world. Examination in this

technology.

area can also be unpredictable; patent examiners come from different backgrounds and often have vastly different

What’s something that

views when it comes to questions of patent eligibility for

people probably wouldn’t

emerging technologies. As the industry becomes a more

expect about you?

mature space, the body of prior art is expanding rapidly, which has pros and cons. When drafting an application, it’s

I funded my undergraduate

easier to see what the starting point is now, so I have a

and law school degrees by

better idea of the scope of protection I’m probably going

playing poker. 

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MAY • JUNE 2021

Michael Portnov is a principal with Fish & Richardson. He focuses his practice on client counseling and preparing and prosecuting patent applications directed to computerrelated technologies. Mr. Portnov has significant patent experience working with inventions in the areas of machine learning and artificial intelligence.

Reach him at portnov@fr.com.

Energy An Exciting New Era for Energy It’s way more efficient and cheaper. Under the Biden adminis-

 Daniel Lynch and Matthew Kapinos, partners with Akin Gump, have extensive experience in the renewable energy space, ranging from regulatory law to infrastructure. Here, they discuss what the future of this rapidly evolving industry holds.

tration, there is no reason for that to change; if anything, the activity in the renewable energy sector will increase.

There are a couple of reasons for this. Certainly the Biden administration is not going to do anything to oppose any renewable projects, initiatives, or advances. In fact, President

CCBJ: With the recent shift from Trump to the Biden administration, what do you anticipate happening in the renewable energy sector?

Biden has said that he’s looking to triple the amount of off-

Matthew Kapinos: I see it accelerating even more. During

sources at the expense of traditionally fossil-fuel generation.

shore wind that is currently in development. On a state level, more and more states are trying to increase the percentage of the electricity required to be provided by renewable

the Trump administration, there were a significant number of renewable generation projects and renewable initiatives

In addition, with a Democratic controlled government,

that went forward. There did not appear to be any retreat or

we will probably start to see more regulatory and other

movement away from renewables, which goes to show not only

influences to help accelerate the energy transition. This

how popular they are, but also how economically worthwhile

will be in addition to the social pressure you’re seeing right

these projects are to many. People want renewable energy. It’s

now to pressure companies into becoming good corporate

not a fad anymore. The technology is significantly improved.

citizens. I also think that a number of large companies that CORPORATE COUNSEL BUSINESS JOURNAL

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an area to offset or delay the need for upgrading transmis-

Increased corporate ESG priorities will propel the renewable energy market forward.

sion lines or building new transmission lines, which are extremely expensive.

Also, when we talk about capacity, in Texas for instance, there isn’t a capacity market. That might be something that will be discussed, if not changed, in Texas. And there are other

know how to do energy and infrastructure projects are now applying their resources and skill sets toward renewable generation or investment in carbon capture, renewable diesel, renewable natural gas, or biomethane. And that’s just going to continue to accelerate. Dan, what do you think?

Daniel Lynch: The renewable energy sector during the Trump Administration continued to be good. This is, in part, due to the fact that Republican support for renewables does exist and the industry has gained a momentum of its own. There are a lot of renewable activities in states with Republican senators.

So that helps act as a bulwark against having a retreat from the renewable energy sector. And now with Biden it’s a great outlook, because it’s a stated focus for his administration.

What changes, if any, do you expect in the regulatory landscape?

Lynch: Short term, I think a one-word response would be “capacity.” There are many different angles to capacity within the regulatory landscape. One angle is how battery storage contributes to capacity. Additional capacity will be needed for certain areas due to increased demand through population growth or other changes. Your choices include: “Do we build an upgraded or new transmission line to that area?” or “Does the State Regulatory Authority require local capacity support in that new area?” More and more

jurisdictions that don’t quite have capacity markets either.

Kapinos: The weather events earlier this year certainly focused a lot of attention on what happened in Texas – a market with much less regulatory oversight than in other parts of the country. As a result, I think you’ll see regulators in Texas attempt to figure out how this happened and to focus on winterization and other market incentives to make sure that this type of event does not happen again.

I think that we’ll also see a much more active regulatory regime on the federal level to really start focusing on reducing carbon emissions, perhaps by using broader interpretation of the regulations to effect the regulatory initiatives of the Biden Administration.

This could be a challenge, as there are many places in the country that are not 100 percent conducive to renewable energy where it simply may make more sense to build gas or to keep a traditional gas plant or even a coal plant on line for a little bit longer; especially in places where the transmission system cannot support the renewable facilities that some want to develop. In any case, I believe that state and federal regulatory agencies are going to be much more active in forcing the reduction in carbon emissions.

What areas within the renewable energy space do you expect to thrive? What opportunities do you anticipate?

the latter makes the most sense, meaning that battery

Kapinos: As I mentioned previously, I believe there are

storage projects are being placed (or will be placed) within

going to be numerous technologies that are all related

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to renewable energy or energy transition really start to

finance and tax equity investments. That’s what they’re

grow and mature. It’s not just going to be a wind and solar

more directly involved in, so they’re looking at that.

world; we’re going to look holistically and see what can we do to reduce all of our carbon emissions and see what possibilities may exist in hydrogen, carbon capture, or other “blue”-type processes. We’re going to see all industries looking at ways to be greener, and it’s going to be much more widespread than just solar panels on every building.

Lynch: Batteries are the future. In fact, they’re pretty mainstream already. If you’re doing a renewable project, everyone at least thinks about including a battery with it. That ameliorates the issue of renewables being intermittent resources. You can have more reliable power coming from the renewable energy system if you’re able to charge a battery during those intermittent stages. It’s not completely one to one, but it does increase the capacity factor with batteries.

In terms of the broader market, I think you’ll be seeing more market participants involved in purchasing operational projects. Overall, operational renewable energy projects are pretty safe investments. There will be entities that are looking to gather that revenue stream, and you’ll see more organizations looking at the U.S. renewable energy market for those opportunities.

Kapinos: It seems to me that there is a bit of concern that there’s a renewable energy bubble out there. It seems like there’s a mad rush to get into the renewable space, but not everyone’s going to succeed and hit it out of the park and have a great project or a great experience. At some point, perhaps a few years from now, there could be some

Also, piggybacking on what Matt said, carbon sequestration

consolidation in the renewable space.

will start to become more important. There will be a drive for corporates to start thinking about not only whether they are 100 percent renewable but also what kind of carbon impact they are having with their renewable projects.

Kapinos: I’d like to mention the enforcement and regulatory landscape briefly as well. People are going to be talking more and more about some sort of additional regulatory regime to incentivize all this. What that looks like will depend a lot on the next couple of election cycles, but some sort of additional incentive will likely be necessary at some point to really solidify the “energy in transition” movement.

What are financial institutions doing to plan for mergers, acquisitions, project finance, etc., in this space?

I also think that financial institutions that were previously very heavily invested in oil and gas, for example, are trying to figure out “OK, what is adjacent to the renewable market that we can invest in that supports the energy transition, but does not require us to completely abandon our core competencies or business structure/purpose.” Say you did services for downhole oil and gas, and now there’s not a whole bunch of new domestic oil and gas exploration going on, but there are definitely people who want to put carbon into the ground. These financial institutions are wondering, “How do we get into that space? How can we transition to the geothermal space?”

There are massive companies that have done very well

Lynch: Financial institutions are focusing on their expo-

without significant involvement in the renewable or energy

sures to a particular market with respect to their project

in transition space, but they have very smart people who CORPORATE COUNSEL BUSINESS JOURNAL

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are very good businessmen and very good engineers, people

Lynch: Just to add to that, the corporate ESG focus and

who can figure out how infrastructure projects work, how

all of these corporations that you see announcing, “Hey,

to invest money, and how to build projects and get on a return

we’re going to 100 percent renewable energy,” that just

on capital invested and deployed. Those are the companies

propels the market forward. There was a decline in the

right now that are starting to look at hydrogen, carbon capture, battery storage, etc. And banks and other lenders, as well as investment funds, are looking at ways to partner with those types of companies to pursue these projects.

How has the recent focus on ESG (environmental, social, and corporate governance) impacted this industry?

Kapinos: You’re seeing a whole lot more corporations getting into the renewable power purchase agreement

amount of utility PPAs that were available for renewable energy projects, and a lot of times the corporates were the ones that came into that void and provided the offtake arrangements for those projects. And the ESG impact is helping to propel the industry even further forward. So it’s great from my perspective, because it really helps the industry, which really provides a net good for society. The next steps for ESG in this space appear to be carbon and the focus on low carbon impact activities. 

(PPA) space and wanting to be a part of the Green Power Movement. You’re also seeing companies that don’t really have a desire to get into renewable energy – not because they don’t believe in it or don’t think it’s a good idea, but just because it’s not part of their core competencies. But those companies are still going to have to figure out the point we were discussing earlier, which is how do we become more carbon neutral? How do we get to net zero?

What can we be part of?

I do not think there will be a single solution, but companies will start looking at everything. Every company is going to want to figure out how to have good ESG characteristics and a good ESG grade; if for no other reason to avoid having embarrassment of the lights on (even if it’s not a company’s fault) in their office building when the grid manager is attempting to reduce the load and conserve energy. And that naturally will lead to increased investment in opportunities for renewable power and other renewable activities.

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MAY • JUNE 2021

Daniel Lynch is a partner with Akin Gump. His practice encompasses derivative transactions, project finance and development, battery storage agreements, energy marketing and trading, renewable energy and M&A. Dan represents clients in a wide range of energy projects, including developers, commercial users and energy marketers. Reach him at dlynch@akingump.com.

Matthew Kapinos is a partner with Akin Gump. He guides energy and infrastructure clients through all phases of drafting and negotiating agreements for the purchase, sale, development and financing of energy infrastructure projects. He has represented midstream companies on joint ventures to develop oil pipelines and multiple clients in developing of LNG export and import facilities.

Reach him at mkapinos@akingump.com.

Renewable Energy Remains on the Rise

power. It’s something that is a factor supporting customers’

Susan Bruce, a member of McNees Wallace & Nurick, discusses the current state of the renewable energy sector, including the regulatory implications of a new presidential administration and what businesses can do to position themselves for success in this burgeoning industry.

CCBJ: What would you say is responsible for the continued rise in interest, investment and adoption of renewable energy sources?

Susan Bruce: It’s a combination of factors. First of all, I see a rise in customer preference for renewable energy.

Customers want to understand where their power is coming from, especially with the growing concern around climate change. Whether they’re residential customers or businesses, customers want to feel like they’re doing their part by supporting renewable energy projects.

Another factor is that regulatory policies are changing in such a way that customers, whether residential or business, can take advantage of different policies that might make it more economically advantageous to pursue renewable energy. That could mean investing in a solar project through a power purchase agreement, buying renewable energy credits, or doing what’s called net metering, where you put solar panels on a roof or install another renewable resource “behind your meter” to offset your electricity consumption. All of these strategies are driven by regulatory policies that support renewable energy.

preference to pursue renewable energy as part of their energy purchasing strategies.

What do you expect the industry to look like in five years?

This is a time of tremendous change in the energy industry.

We have a new presidential administration with clean energy investment being a priority. It’s hard not to see the industry growing in the next five years. Right now, much of the development is occurring on a state-by-state basis, where different state policies are supporting different renewable energy technologies. It’s possible that we could have a more cohesive national strategy supporting renewable energy in five years.

While I see the industry continuing to grow over the next five years, an important thing to consider is that most renewable energy resources are intermittent in nature. A solar project will produce electrons only when the sun is shining.

Wind turbines need the wind to be blowing to generate electricity. So, it’s important to consider what types of resources will be developed to complement these more intermittent products. For instance, there’s expected to be a good deal of development of batteries and other storage to complement these intermittent renewable resources.

What policy changes do you anticipate with the Biden administration? What impact might they have?

We have definitely seen clear signals of a shift in this area

Equally important is price. Renewable energy is becoming

with the new administration, in terms of renewable energy

more and more cost-competitive compared to conventional

and climate change being priorities. In the short term, we

types of energy. And it can provide valuable hedges to a

expect the president to unveil details of a major infra-

business that might be purchasing other more conventional

structure package that is expected to include spending on CORPORATE COUNSEL BUSINESS JOURNAL

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those projects has helped to drive down the costs of re-

Renewable initiatives tend to be competitive with more conventional types of energy generation.

newable projects. As a result, certain types of renewable energy resources can be competitive with more conventional types of energy generation.

One of the criticisms of the investment tax credit approach

climate change. Certainly, we’re seeing additional support from the Federal Energy Regulatory Commission for ensuring renewable energy resources that are supported by state policies like renewable portfolio standards are counted toward resource adequacy targets.

What is the role of investment tax credits in spurring

has been that the tax credits have expiration dates, which has caused lumpiness in investment. But I think we will continue to see tax credits being a driver for investment, with customers taking advantage of investment tax credits, whether it’s from a tax equity perspective or the developers themselves partnering with those that have tax equity appetite.

renewable energy growth?

What is the greatest challenge for businesses looking

Investment tax credits have been a crucial reason why

approached?

to invest in renewable energy, and how should it be

the renewable energy industry has taken off over the past several years. It’s not a new concept, but it’s really played

For many organizations, the first thing to be tackled is

a key role in encouraging investments. It spurred many

defining the objectives. What are you trying to achieve

of the projects that we’ve seen, and the development of

with your investment in renewable energy? Is the

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MAY • JUNE 2021

There’s expected to be a good deal of development of batteries and other storage to complement these intermittent renewable products.

standing of the regulatory risks for investing in these projects. Building the right team is half the battle.

For those on the supply side of the ledger and developing renewable projects, many of the same issues exist.

Regulatory risks are real in this space since electricity is

investment designed to achieve corporate sustainability goals, position your business to be more attractive to customers or investors, or help manage energy costs?

Are you using it as a physical or financial hedge? For example, if you’re investing in solar projects to help reduce your usage during hot weather days, there may

a highly regulated industry. Even if we are talking about competitive forces being involved, the markets that these resources sell into are heavily regulated. There are significant capital costs, and getting projects interconnected to the grid requires coordination with local utilities.

be benefits in terms of certain demand-based charges on

Sometimes there are unforeseen costs associated with

your electricity bill. So that’s the first thing – for organiza-

that process, understanding what the regulatory require-

tions to identify and understand their objectives.

ments are. We’re seeing a number of new entrants

Another challenge is that we’re in a time where costs associated with renewable resources are declining. So, when to invest is an important question. Also, when we’re considering electricity, including renewable energy, it’s a highly regulated space. So regulatory changes can influence the economics of decisions about how and when to invest in different projects.

within the renewable energy space. Having a clear appreciation of necessary regulatory approvals, whether you’re selling electricity at the wholesale or retail level, it’s all

All of these things lend themselves to ensuring that you

part of the challenge for

have a good understanding of why you’re looking to

those looking to become

invest in renewable energy and then assembling the right team to help you through the process. For example, a long-term power purchase agreement – how does that fit with your procurement strategies? Do you want a renewable energy project to be on-site? How “green” are you

suppliers in this space.

Electricity is an essential product, so understanding the reliability consequences

looking to be? Are you trying to meet certain targets as

in terms of the grid and

a business? These considerations lead to the importance of

your customers is also

having a good team assembled and having a firm under-

critically important. 

Susan Bruce, member with McNees, regularly advises energy-intensive businesses and municipalities on energy and natural gas matters, including negotiating retail and wholesale energy contracts and supporting sustainability initiatives through physical and virtual power purchase agreements and on-site generation, including renewable and combined heat and power (CHP) energy projects. Reach her at sbruce@mcneeslaw.com.

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Increasing Storage Capacity and to Match Increased Energy Creation

pricing is generally lower due to increased supply caused by

McGuireWoods lawyers Brian Kelly, Michael Woodard and Emilie McNally discuss the economic and regulatory climate for renewable energy and how the Texas power grid failure, the pandemic and the Biden administration’s energy priorities affect the outlook.

decreased demand. As a consequence, when Winter Storm Uri arrived, many generators were not capable of running because of previously scheduled maintenance issues and shutdown schedules. The lack of available generation caused the Public Utility Commission of Texas (PUCT) to order the Electric Reliability Council of Texas (ERCOT) to

CCBJ: Texas experienced a historic widespread power outage in February when the grid was unable to keep up with the spike in demand. How might this crisis and its aftermath affect the market for renewable energy in Texas and elsewhere?

Brain Kelly: The near shutdown of the Texas energy grid during the period of February 13-19, 2021, was caused by a variety of factors. The Texas energy market was built to take on summer heat, not withstand intermittent periods of below freezing temperatures and precipitation events.

Unlike generation facilities in the Mid-Atlantic or New England that are designed and equipped to manage operations during ice and snowstorms, Texas generation facilities

set all energy pricing at $9,000/MWh throughout the Texas market in a failed attempt to incent generation to deliver power to the ERCOT grid. However, generation failed to dispatch because of gas and grid constraints (e.g., physical constraints), not due to weak pricing signals.

This created a cascading event. Due to the lack of generation supply, load-shedding events were implemented by ERCOT in the form of rolling blackouts. These rolling blackouts initially impacted only commercial and industrial users, however included in this group were natural gas compression stations throughout Texas whose purpose was to keep natural gas flowing within the pipelines for use by both residential customers, but as well as natural gas-fired generation stations. When the compression stations lost power, the

are generally not built with what is commonly known as

ability to transport natural gas was dramatically impacted,

cold weather packages. While Texas-based generators were

creating a scarcity of gas that significantly increased the

encouraged to winterize their units following a less intense

reporting prices of gas. This shortage of gas also caused

winter storm in 2011, many did not elect to implement those

gas-fired generation to be shuttered, which further exacer-

winter weather upgrades.

bated the electricity shortage throughout Texas.

Further, Texas simply did not have enough generation

The lack of sufficient generation capacity reserve available

capacity available for dispatch at the time Winter Storm Uri

for dispatch during periods of historical low usage across the

impacted the state. Texas is an electricity-only market that

state, combined with uncoordinated load shedding mitigation

expects its peak load to occur during the hot Texas summers.

(shutting down power to gas compression stations) caused

Consequently, while generators strive to be available for

the entire TX grid to come to the precipice of a complete

dispatch during May-September when pricing is generally

shutdown. The knock-on issues from the physical impacts of

at its annual peak, many system owners put less impact

Winter Storm Uri will likely involve changes to market design

on its dispatch capabilities in the winter months, when

to prevent such an occurrence from happening again.

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MAY • JUNE 2021

While the desire for renewable generation in Texas remains

Offshore wind projects are key to the clean energy plans

strong, the aftermath of Winter Storm Uri will likely impact

of Atlantic coast states, but they often are subject to

how all generation facilities will be financed in the future.

greater delays. What are the keys to keeping these proj-

For instance, financing institutions and developers will place greater scrutiny on force majeure clauses used in financing and revenue contracts to prevent a party from having uncapped real time market exposure to market pricing during a scarcity event similar to what occurred during Winter Storm Uri. Revenue contracts will likely move away from firm, fixed volume structures, where developers assume all weather and operational risk to generate and deliver a fixed volume of energy over a stated period, to more unit contingent structures, where the facility is only required to generate power as and when it is capable of operating.

President Biden has said he wants the U.S. to achieve net-zero emissions by 2050. How will his administration’s

ects moving ahead in the near future?

Michael Woodard: Offshore wind projects are expected to play a significant role in the country’s ability to achieve its climate goals. In addition to cutting greenhouse gas emissions, offshore wind projects are expected to create new supply chain opportunities and generate significant job growth. However, offshore wind projects are new to the U.S., are not easily designed and constructed, are heavily regulated and involve numerous public interest groups – all of which result in offshore wind projects being complicated and expensive.

There are several keys to making these projects viable projects in the future. One of the primary keys is in-

energy priorities affect renewable energy development?

vestment in infrastructure. To construct offshore wind

What sectors are likely to benefit most from this

facilities, many of our nation’s ports will need to be up-

policy shift?

graded to accommodate the ships, equipment and other

Emilie McNally: The Biden administration’s goal for the

addition, investment in the supply chain that supports

U.S. to achieve net-zero emissions by 2050 is obviously beneficial to U.S. renewable energy development. To meet this goal, the U.S will need to increase renewable generation capacity from the 1,100 gigawatts currently available to at least 3,000 gigawatts. This increased generation capacity is largely expected to come from solar and wind, including offshore wind, project development. Even if President Biden can’t win support from Congress, his administration will still be able to advance renewable energy policies through executive orders and other, federally-focused projects and strategies (including the development of solar and wind

components necessary to construct these facilities. In this industry is important. Offshore wind projects require investment in turbines, towers/foundations, underwater cables, ships, etc. – many of which are currently being imported from abroad. Another important key where the U.S. government can play a role is streamlining the regulatory and permitting process. Currently, the regulatory and permitting scheme for these projects not only slows down the advancement of offshore wind projects, but it also significantly increases the costs. One of the most important keys to advancing the offshore wind industry is to start building. The technology is getting better and cheaper with time, and as more projects are built, the

projects on federal lands and waters) and will continue to

more experienced and efficient we will become in designing,

lean on growing support from the private sector.

developing and constructing offshore wind projects.

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As coal-fired power plants are retired, what opportunities are there to redevelop those sites as renewable energy facilities? What obstacles must be overcome?

Kelly: Coal generation facilities are increasingly being mothballed, retired and decommissioned across the country. While the shutdown of coal has benefits from an environmental perspective, the energy and resiliency benefits brought by these baseload generation facilities need to be partially offset by additional generation development. Part of that solution can be repurposing former coal generation sites to be development sites for renewable generation. However, this conversion comes with a combination of benefits and additional concerns that must be considered by developers and financing parties. These are a few notable factors to be considered: • Capacity Rights. One of the primary benefits of using a former coal site for solar development is access to grid infrastructure and related capacity. Having an interconnection facility in place and an entity with available capacity can expedite a project’s interconnection agreement approval process significantly. However, any developer looking to take advantage of a coal facility’s generation capacity must make sure it strictly adheres to all transfer requirements imposed by a utility to a grid operator. For instance, in PJM, capacity rights may only be transferred within one year after the original facility retires and/or deactivates its units, and such transfer much be done in a manner that is consistent with the PJM rules in order to be recognized by the grid operator. If done correctly, the transfer of the capacity rights can save a developer a significant amount of time and money.

• Decommissioning Concerns. Initially, any renewable developer will need to confirm, or otherwise assume, that all of the coal facility’s asset retirement obligations (AROs) have been satisfied or otherwise waived by the appropriate governmental entities. These AROs may 54

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be required by applicable law, may be embedded in a certificate of public convenience and necessity (CPCN) that originally authorized the construction and operation of the generation facility, or otherwise included in subsequent documentation such as consent decrees.

Regardless of the source, a developer should confirm that all AROs have been identified, addressed or otherwise mitigated.

• Environmental Issues. Both developers and financing parties must have a comprehensive understanding of the likelihood of long-term environmental liabilities located at the site to be developed. If a Phase I environmental site assessment detects or identifies any environmental liabilities, those will likely need to be remediated, or at least identified and mitigated, prior to obtaining any third-party financing. While financing parties are growing increasingly comfortable with projects located on sites with environmental history, those projects will undergo significant diligence by third-party investors (including tax equity investors). In those instances, developers are well advised to be forthcoming with the reports and have plans to remediate the portion of the site impacted by the environmental liability or otherwise have a mitigation plan (which may be a proposed remediation plan, an indemnity from a credit-worthy counterparty, or a combination) to assuage the concerns of equity sponsors and debt financing.

• Assumption of Legacy Assets and Obligations. Another material item to consider is the assumption of legacy assets and real property obligations that likely burden the property. Legacy permits, easements and other rights of way will need to be terminated or amended to allow the generation facility to have an unobstructed access to the site. Likewise, wastewater processing facilities, outfalls from wastewater and stormwater discharge, and the related permitting schemes will need to be modified

or otherwise terminated. All of these actions will involve necessary communication and obtaining the necessary consents from regulators, and may even involve public comment periods. It is imperative to identify these types of issues as early as possible so this process does not slow down the overall project timeline.

How has the COVID-19 pandemic impacted development of renewable energy projects?

Woodard: Of all the industries impacted by COVID-19, the renewable energy industry has not been hit as hard as others have. However, the industry has not been spared completely.

One of the biggest impacts on the industry has been delays – development and construction schedule delays. The production delays across the supply chain for renewables has been a serious threat to renewable projects across the U.S. Many developers have been confronted with force majeure claims from their equipment providers and have incurred significant costs in obtaining replacement equipment and parts. To compound the increase in costs associated with schedule delays, many renewables projects were Brian Kelly, partner with in jeopardy of missing key McGuireWoods, leads the firm’s energy industry team. Based in dates and continuity reBaltimore, he advises energy industry quirements that are necesand financial clients on a wide range sary to satisfy safe harbors of transactions, including mergers and acquisitions, energy project and to qualify for certain tax infrastructure development, project credits. To address this, finance and structured commodity and hedging transactions. Reach him in May 2020, the IRS at bkelly@mcguirewoods.com. issued extension relief for these projects.

Another major impact

COVID-19 has had on renewable energy projects is the impact on its investors. Tax credit investors monetize tax credits generated by these projects by offsetting net income. As net income of many investors dropped in 2020 due to COVID-19, the pool of tax credit investors decreased and many renewable energy developers have found it difficult to raise tax equity. The uncertainty of the pandemic has only made financing these projects more difficult. As a result, there is a strong movement in the industry urging the U.S. government to postpose the phase-out of certain tax credit timelines.

Despite the delays and the impacts on the tax equity market, the renewable energy industry has continually proven its resilience – and as we face the hopeful light at the end of the COVID-19 tunnel, many developers are confident in the future of this industry. 

Michael Woodard, partner with McGuireWoods, chairs the firm’s Mergers & Acquisitions and Energy Transactional Department. Based in Richmond, Virginia, he advises purchasers and sellers, both private and public companies, in stock and asset purchase and M&A transactions, as well as joint ventures and leveraged and managementsponsored buyouts. Reach him at mwoodard@mcguirewoods.com.

Emilie McNally is an associate with McGuireWoods in Richmond, Virginia.

She focuses her practice on advising buyers, sellers and developers on transactional and advisory matters in a broad range of energy-related projects and transactions. She has industry expertise in the renewable energy, power, and oil and gas sectors. Reach her at emcnally@mcguirewoods.com.

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Are You a Legal Operations Professional?

Be sure to follow InHouseOps.com and @InHouseOps for updates and posts from key industry leaders!

OPS

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Suggestions or submissions to ourat Suggestions or submissions can becan sentbetosent our editors editorsinfo@inhouseops.com. at info@inhouseops.com.

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Ops Putting Control in the Hands Of Legal Departments encouraged innovation, which will help clients by reducing

Don Keller, CEO and founder of Joinder, discusses the unique capabilities of his company’s new legal tech platform, and how it can help empower in-house legal departments to truly take command of their work product.

billable hours and making things more efficient — and as a result, we will be rewarded with more clients. He believed that those who do not embrace innovation will become dinosaurs. That was formative for me.

In 2005 a large number of Venture Law Group lawyers

CCBJ: You’re a former partner at Orrick and at Venture Law Group. How did your experiences with those organizations lead you to your current role with Joinder?

Don Keller: I came to Venture Law Group from a large firm, Morrison & Foerster, where I’d been a partner for five years. I was looking to be an entrepreneur in the legal

joined Orrick, so Orrick really shares significant DNA with VLG. That led to Orrick consistently winning awards for innovation, client focus and client service. And it led to Orrick encouraging us in the development of Joinder, which actually grew out of a client-focused project in Orrick’s corporate group, where we built an electronic file system that enabled clients to access their corporate records at any time.

space, and at the time VLG was led by Craig Johnson, a real

The system was a huge success. It provided a significant

pioneer in the law. He always pushed two concepts. One

benefit to clients, who for the first time were able to locate

was that it’s all about the clients. And second, he always

their records and easily access them. It provided a system CORPORATE COUNSEL BUSINESS JOURNAL

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of record for more than 1,000 Orrick clients. After that

Joinder flips the script and puts control firmly in the hands

success, we looked for ways to commercialize the Orrick

of the corporate legal departments. The goal is to allow

product and make it even better. That led to a decision to

better, faster, and more cost-effective decisions, leading

spin it out from Orrick, which is the origin of Joinder.

to better outcomes, greater efficiency, and improved and enduring lawyer-client relationships.

Tell us more about Joinder, how it was developed, and the kinds of solutions it offers.

Joinder clients have the ability to develop customized platforms such as pay-equity analysis checklists, employee

Joinder’s focus is primarily on corporate legal departments.

termination workflows and forms, and board meeting

We subscribe to the concept that corporate legal depart-

management and documentation. How have clients

ments pay for their work, own it, and should have control

responded to these opportunities? What are some of the

over it. Historically, they have had challenges getting

key differentiators that Joinder offers?

access to the work product because it has been spread out within different law firm systems. We set out to

There are three key differentiators that I should mention.

allow companies to manage deadlines, tasks, and records

First, there are the templates Joinder provides. Second, is

in a single place, for any kind of legal project whether

the ease of implementation. And third is the combination

involving an outside firm or being handled entirely by

of deadlines, tasks, and records in one place and in one

the legal department.

product, allowing work across organizations.

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MAY • JUNE 2021

Joinder delivers a useful system of record for legal departments.

Another differentiator is the easy implementation. Our product is designed so that with just 15 minutes of training you can be off and running. And Joinder is incremental, you can start with a single project while other projects are not in Joinder.

We have more than 20 templates that provide a predeter-

The third differentiator is the fact that we’ve combined the

mined, but modifiable, set of tasks that are associated with

management of deadlines, tasks, and records in one place.

a practice area. There’s also a set of folders that are relevant

There are products that manage tasks. There are some that

to the practice area, and in some cases, there are addi-

manage deadlines. There are some that just manage records.

tional forms that are handy in that practice area. These

But we are combining these three capabilities in one place

templates exist for all sorts of different areas, including

– and we’re betting that combining these elements actually

intellectual property litigation, employment litigation,

simplifies the experience for the user.

securities filings, venture financing, mergers and acquisitions – basically any area where there’s a likely project for

You’ve been quoted as saying, “For many legal teams,

a user, we’re trying to create templates for them. So when

control is fragmented and fleeting, at best.” How does that

they go to start a project, instead of starting with an empty

play into the continued development of Joinder and your

page, they’ll start with a template that we provide to them.

relationships with clients and users?

They can modify it and in effect create their own custom template, so that every time they have an intellectual

Joinder delivers a useful system of record for legal depart-

property case, for example, they can use their version of

ments. They pay for the work and they own it, and yet they

the template, which is consistent with how they work and

often can’t access it or even know where to find it. For us,

consistent with how they manage their outside counsel

it’s all about the companies. Law firms will use our product

or their in-house counsel.

if they are focused on providing a better experience and more value to their clients, which we think is the case for

This gives them confidence that the task list, for example,

many firms. We always say that it’s all about the clients.

covers exactly the areas they want covered. They can also

Whatever can be done to improve the client experience, the

use the task list as a way to have a set of deadlines associ-

better it is for everybody involved.

ated with a project, and the various participants in the project have access to those deadlines and can see what’s

How do you anticipate in-house law departments evolving

coming up in the next couple of weeks in a manner not

over the next five to 10 years. What will Joinder’s role be

possible with other products. It is important to note,

in that evolution?

the templates are “no code,” meaning there’s no code to be modified to create a template, nor is there a need

Legal departments are growing and taking control of their

for custom consulting.

overall legal effort. You can see that with the rise of legal CORPORATE COUNSEL BUSINESS JOURNAL

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get the best result. But to make that all work, they need

Joinder flips the script and puts control firmly in the hands of the corporate legal departments.

control over the work product. It doesn’t work if the work product is managed by one of the participants in the project and they’re constantly having to update everyone else and remember who was updated on what concept. That is where Joinder comes in and provides a solution. We’re targeting the legal departments to be the users and providers

operations professionals in many, many companies. You

of that solution to their law firm environments.

can also see it in the growth of the number of lawyers in legal departments, in the range of expertise that they

In the next five to 10 years, I see legal departments really

offer, and the amount of control they’re already taking

controlling their work, as they have increasingly shown

with respect to their work and projects.

that they are doing already, by getting bigger and hiring more and different law firms for different projects. I

However, they are held back to some degree by the current

believe that this trend will absolutely continue, and law

lack of access to deadlines, tasks and records, because in

firms need to react and

most cases those items are controlled by the outside law

need to work in that

firm that has been hired. Deadlines are a good example.

environment.

Particularly in litigation, deadlines are handled in a calendar system run by the firm. That calendar system is

The other reason I believe

a single organization system, not accessible to clients. So,

Joinder will play a signifi-

clients have to ask for an email summary or an updated

cant role in this evolution

calendar to understand what’s coming up. With Joinder,

is that providing a system

however, the data gets stored in one place, and it’s acces-

of record and a single place

sible by the teams working on the project across multiple

for the work product is a

organizations – it could be multiple law firms as well –

unique concept for legal

so that everybody has the same information and can work

departments, who in the

toward the same goals.

past, have been provided with various point solu-

Legal departments now have access to more and better

tions, like billing or matter

information about the quality and capabilities of the firms

management, that don’t

and alternative legal service providers (ALSPs) they use.

operate at the center of the

That allows them to increasingly choose the right lawyer

actual work getting done.

for the job, or in some cases multiple lawyers or firms,

We bring control back to

or a combination of ALSPs and law firms, all designed to

the legal department. 

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Don Keller is the CEO and founder of Joinder, a SaaS engagement platform that provides a system of record for legal projects and files/documents.

Don spent his legal career at Orrick and Venture Law Group advising high growth technology companies, public companies, venture capital firms and investment banks. He has advised clients on more than 60 public offerings, 75 acquisition transactions and several hundred venture financings. Reach him at dkeller@joinderapp.com.

Using Data to Foster Innovation

organizations operate for the better, that’s exciting – it’s the

Jess Hunt, board member with Bodhala, discusses the origins and strengths of a transformational new product in the legal industry.

basis for great customer value and great enterprise value.

The second is really the strength of the team. The founders are a couple of people who genuinely understand the legal industry, how in-house legal departments operate, and

CCBJ: You were recently appointed to the board of directors at Bodhala. Tell us about the company and what drew you to the organization?

Jess Hunt: Bodhala is building a transformational product in the legal industry. It’s an intelligence tool that will

most important, are bound and determined to improve it.

You’re a past president and chief operating officer of Andela, and you also previously served as an executive with Axiom. How are you applying the skills needed for that going forward on the board?

change how in-house legal departments operate. And that’s

Bodhala recently added two independent board members,

certainly what drew me to Bodhala first and foremost. Any

of which I am one. Jeffrey Levinthal, an entrepreneur and

time you have an opportunity to really change the way large

an investor, is the other. He’s a been a founder several

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Bodhala talks about a lot. The insights from data that

We help the company think ahead to see around corners. To think about what happens when you’re 10 times bigger, a hundred times bigger?

Bodhala offers delivers things like price discovery – allowing for competition, enhancing and driving real accountability, and as I said, it can really foster innovation. Legal billing historically has been trapped in a black box. We’re getting better with accessing information,

times over. Myself, I’m really a growth-stage operator – someone who’s seen numerous times the challenges and opportunities that companies face as they grow post-product market fit. Our skills certainly complement each other.

Ideally independent board members like us do a couple things for early stage high-growth companies. We help the company think ahead to see around corners. What happens when you’re 10 times bigger, a hundred times bigger? We also challenge thinking. We challenge the thinking, ideally critical thinking on behalf of the board, but also very much the leadership of the company. We even challenge the thinking of our colleagues on the

but I think Bodhala is really a first-in-class, best-in-class product that delivers the intelligent insights in-house counsel needs for legal spend.

What is your advice to legal professionals who are new to using data and KPIs in their decision-making and planning processes?

Do your own research, but generally the most effective route to data transparency is with an external solution like Bodhala something specifically

board who may be investors. And then I also think we

built to help in-house

help the team focus on what’s important. That’s incred-

legal departments to take

ibly hard when you’ve got a million things to do when

control of their relation-

you’re moving from a start-up to a scale-up. And then

ship with outside coun-

finally we support the CEO and the team. We like to

sel. And so, in essence

think that we’re all partners in the growth.

Bodhala’s advice to our customers is to put the

How do you see data and access to key performance

data to work for your

indicators (KPIs) transforming the legal profession?

decision-making, as well as communication with

Access to insights from data is enabling. It enables bet-

internal clients and

ter decisions. It enables innovation, which is something

outside counsel. 

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Jess Hunt is a member of Bodhala’s board of directors in New York.

An experienced executive of high growth companies, she previously oversaw Andela’s worldwide operations including the revenue organization, operations, product & engineering and people. Prior to joining Andela, Ms. Hunt served as Executive Vice President at Axiom.

Reach her at jesshhunt@gmail.com.

Redefining In-House Counsel As a Driver of Value

better manage the department, have access to key metrics,

Ken Crutchfield, vice president and general manager of Wolters Kluwer Legal & Regulatory U.S., talks about the shifting role of the legal department, the importance of tailoring your conversations to your audience, and how general counsel can use metrics and key performance indicators to help a company meet its business goals.

keep track of their risk, and to know what the corporation

CCBJ: The role of the legal department has expanded

The first thing is to base them on business objectives

significantly over the past 10 to 15 years. How do you and Wolters Kluwer Legal & Regulatory support general counsel and other in-house legal professionals?

Ken Crutchfield: We provide information solutions to in-house counsel to help them with a number of different challenges they may experience. We work across different domains and practice areas – everything from the cerebral questions about something within labor and employment or intellectual property, for example, to very practical information that allows general counsel to be able to make decisions about where to complete specific tasks. These are all available on our Cheetah for Corporate Counsel product platform. Those are some of the broad ways that we work, but increasingly we’re also looking at workflow solutions, challenging tasks like multijurisdictional surveys, and other information solutions that support better outcomes

has when it comes to all of that critical information.

What are the metrics and key performance indicators (KPIs) that general counsel should focus on?

Well there is a lot to cover on KPIs.

and the company’s strategy. If a company is in growth mode, for example, it should have metrics and KPIs that are aligned with that goal. Here is another example. If a company is in a controversial industry and doesn’t want to have a high profile and doesn’t want to be in the news, the metrics, objectives, and policies should tie to litigation avoidance and early settlement to minimize publicity.

From a business operations perspective, counsel can consider reducing cycle time on new sales contracts or time-to-completion around tasks. Reducing the number of exposures and risks that they have with suppliers is a great KPI to consider too. And we’re starting to see some corporate legal departments creating KPIs around internal client satisfaction as well, in terms of things like approachability and willingness to help and ability to manage stakeholders and things like that. It’s starting to go both ways, which is great.

for general counsel and the business.

I will also say that I’ve noticed a tendency for organizations We also have a contract, matter, and entity management

to want to measure what is easy to measure. But oftentimes

software that supports small and midsize corporate legal

those metrics that are easy to measure don’t really have

departments called Legisway. It helps counsel to manage

much meaning or tie directly to corporate priorities

their contracts, their compliance matters, as well as their

(metrics that are easy to measure, but don’t tie to prior-

various entities, giving them a single source of truth when it

ities are referred to as “vanity metrics”). As a foundation,

comes to all of their corporate legal information. Legisway

companies really need to make sure that they’re measuring

allows general counsel to easily create reports that help

things that are important and not merely easy to measure.

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One issue that is often raised that we talk with corporate legal departments about is risk. That means being able to create KPIs around risk – creating a corporate risk profile.

That’s something that’s typically done in conjunction with the board, and in alignment with the company’s strategic goals, to make sure that the legal department understands, for example, the contractual risk. What are the company’s liability gaps? Where do its exclusions come in? Does the department have a process for things that may need to go outside of those exclusions? Is there an appropriate escalation path? Does the legal department have an audit standard in place where it can randomly sample compliance with policy? By getting visibility and control over risks and compliance to policy, general counsel can sleep a little easier

We’re starting to see some corporate legal departments creating and measuring KPIs around internal client satisfaction. to communicate legal issues, obviously, but it’s important to frame them within the context of the overall business goals. And ideally the conversation should be tailored to the audience. If general counsel is talking to the chief financial officer, for example, they should speak more in financial terms. If they’re talking to the marketing or sales leads, they should speak in terms of reducing cycle time, driving more

knowing they are taking actions to effectively manage risk.

sales, or speak about brand and reputational risk.

How can general counsel better communicate with the

It’s also about helping solve problems to help move the

board and the C-suite?

business forward, as opposed to just being the cautionary conscience of the company. Highlighting risk is an import-

The general counsel really needs to speak the language of

ant part of what the general counsel does, but it’s also

the board and the C-suite. That means speaking in business

important to make sure they are balancing that out with a

terms more than legal terms. A general counsel does need

can-do attitude that focuses on what is possible too.

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MAY • JUNE 2021

During the pandemic, the general counsel’s office has been key in setting goals, policy and priorities – including dealing with human resources issues, office closings, personal protective equipment policies, supply chain management and fair pricing, among other things. What do you expect

The general counsel really needs to speak the language of the board and the C-suite.

to be the long-range impact of this highly visible and critical increase in the general counsel’s sphere of influence?

This really has to do with shifting the perception of the general counsel’s role from being a cost center and a “necessary function” to being a value driver for the organization. Is it the “department of no”, or is it the department of possibilities? The truly successful general counsel can, more often than not, find ways to protect the business from risk and pursue its goals. To the extent that general counsel has been especially helpful throughout the pandemic, this is a great time to point to the creativity and support provided to get to better outcomes and better solutions for the business.

The pandemic has required creative solutions. I’d encourage general counsel to point to the department’s role in supporting business continuity as a way to gain more credibility

the avalanche of work is to apply technology (tools) to create more leverage and to automate more work. Technology isn’t always the first thing that general counsel may consider, but adopting technology solutions may be a great way to relieve some of the pressure.

I always recommend that a legal department start with a problem and then engage IT or the Legal Operations lead to help determine the appropriate technology to leverage.

Finally, let’s circle back one more time to KPIs. We see some of our customers solving for productivity by creating self-help tools

and influence with the C-suite.

for the business to use.

What else do you think our readers should know about

contract templates that

These can include different

the ever evolving role of the legal department?

staff can access themselves,

Legal departments are under a lot of pressure. We spoke

disclosure agreements, and

about KPIs earlier, and that is a great example of how they are being treated more and more like other parts of the business. This extends to diversity & inclusion, hiring, and complying with supplier policies when selecting outside counsel. For example, an RFP process might be required to

different automated nonother things like that. And if counsel can track the usage of these tools, the legal department can be confident that the more mun-

engage with counsel where a phone call to a reliable partner

dane legal work is getting

at a trusted firm would be all that was required in the past.

done while freeing up precious attorney time to

There is more work than ever and there are more laws to

do things that are more val-

comply with as a business grows. One of the ways to address

ue-add for the business. 

Ken Crutchfield is the president and general manager of Wolters Kluwer Legal & Regulatory U.S. He leads the Legal Markets group and is responsible for setting the vision and strategic approach with a focus on developing leading digital products.

His group aims to provide legal professionals across a wide range of markets with expert content and analysis and leading workflow solutions. Reach him at ken.crutchfield@wolterskluwer.com.

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Pairing Incredibly Sharp Legal Minds With Brilliant Data Scientists

talent, the domain expertise, the business development

Wendell Jisa, CEO of Reveal, and Jay Leib, executive vice president of Reveal, discuss a new technology-enabled legal service, Aiscension, that’s aimed at discovering business risks posed by cartels.

and the client development. And DLA is going out to its clients, particularly those in areas of industries that have risks around cartels, and they’re saying, “Look, if a cartelrelated event were to take place, you could be on the cover of The Wall Street Journal, the regulatory fines would be

CCBJ: Together, Reveal and DLA Piper have announced the launch of Aiscension. Tell us about how this collaboration came together, and what you’re striving to achieve.

Wendell Jisa: Reveal is a cloud-based e-discovery provider.

We started working with DLA Piper on the launch of Aiscension about 30 months ago. The idea was to bring the resources from the legal experts at DLA Piper, which is a top global law firm, together with the data science team at Reveal – to have them collaborate on a joint venture. It has been a really exciting opportunity. What we’re striving to achieve is to bring more automation to the practice of law, and to allow Aiscension customers and DLA clients to be able to use this technology to get answers from their data faster.

enormous – they could be up to 10 percent of your worldwide revenue, right? Instead of waiting for that to occur, why don’t we go ahead and analyze your data proactively and see what the risk is? You can do it as a one-off, once per year, like a medical exam, or you can do it quarterly, as a subscription.”

Aiscension is going to analyze the data using Reveal’s AI technology, which we developed in collaboration with Aiscension, and it’s going to be able to look through all of a company’s electronic communications, documents, everything that is of particular interest. It’s going to analyze all of that data and say, “These documents, these communications, are of high signal to this issue.” Then the legal talent from Aiscension, which is the DLA talent, is going to go ahead and check those documents to see if

How does Aiscension work?

there truly is an issue there.

Jisa: Aiscension is a technology-enabled service, powered

Basically, the algorithms that we’ve developed are going

by this spinoff company, Aiscension, which is a subsidiary of DLA Piper as part of Aldersgate Holding Company. DLA and Aldersgate have really been investing in technology and business platforms that are going to revolutionize their business model, and Aiscension is one of those subsidiaries.

to go ahead and analyze this data, and say, you know, “Out of all the data, here are the five, 10, or 20,000 documents – whatever the case is – that have some signal of risk.

We’re going to use our legal expertise to analyze them and see if there truly is risk there, or if there’s actually nothing to worry about.” If they don’t find anything,

Jay Leib: Right, that’s a great overview. More specifically,

they’ll move on. If they find something, then they’ll go

Aiscension is a technology-enabled cartel risk-management

ahead and jump-start a true investigation, which could

service that uses artificial intelligence (AI) to help detect

save the company millions, maybe even billions of dollars,

risks in a business. DLA Piper Global supplies the legal

depending on how large the fines could be.

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MAY • JUNE 2021

Generally speaking, legal professionals are using tech-

Leib: Those are all really good points. I’ll just add a couple

nology and data more and more. Describe the relationship

of things. One is that we don’t believe in AI for AI’s sake.

between the legal professionals and data scientists that

We believe in utilizing – with our talent and our technology

help fuel the Aiscension platform.

and our expertise at Reveal – AI to solve problems. We wake up every day focusing on the area of e-discovery

Jisa: Our vision, and my personal initiative, is to allow

and investigations, and all of the things around that legal

the smartest legal minds in the world – the folks at DLA

vertical. The AI doesn’t know anything about the law. It

Piper and, by extension, Aiscension – to collaborate with

doesn’t know anything about signals of cartels. That’s

the smartest minds in data science in the legal technology

where the partnership comes in. We’re the recipe that

space, which we believe we have at Reveal. We’re putting

includes the legal experts, the expertise, the domain

these two groups together, both of whom who are experts

knowledge of DLA Piper, along with Aiscension, the

in their areas of expertise. By collaborating, we will create

technology platform, that we’ve spent millions of dollars

something new that will do two things. One, we’ll bring

building out in R&D, and our data science team, which has

automation to the practice of law, or help facilitate it. And

the expertise on how to optimize AI models, how to help

two, we’ll introduce a new way to commercialize legal ex-

dissect problems that are presented by the legal experts,

pertise. That’s what, for me, from an entrepreneurial per-

and how to translate all that into a system that can be

spective, is so powerful. The volume of data is growing. We

utilized by legal experts who may not have training in

need to get answers faster, but we also need to figure out

computer science. Our team does that work. Our team

a better way of charging for this. I believe that Aiscension

is able to optimize for that – to let them do what they do

has figured that out.

best, which is legal review and analysis.

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Leib: Absolutely, that’s a great point. Whenever we read an

Our vision is to allow the smartest legal minds in the world to collaborate with the smartest minds in data science in the legal technology space.

– WENDELL JISA

article in the paper about this kind of thing, people always say, “Well, didn’t the CEO know about this? Didn’t the general counsel know about this?” Well, it’s impossible for CEOs and general counsel to know about everything at scale, right? So finally, there is this tool and service that the board of directors, the CEO, the general counsel, can all utilize to get that health test, because who wants to wake up to a knock on the

What types of organizations should be considering adopting Aiscension?

Leib: To begin with, Aiscension is focusing on detecting cartels, and cartels can really hit a variety of different industries. Consumers are being impacted, industries are being compromised by these groups. As I mentioned, the worldwide fines for something like that could be 10 percent of revenue, which just an enormous amount of money.

The reason detecting cartel activity works so well with this kind of technology-enabled service, which features AI

door from a government agency? That’s the kind of thing that keeps people up at night. This gives them peace of mind.

Jisa: Right. The fact that you have married DLA Piper and Reveal to create this service offered by Aiscension, it accelerates access for all of these corporate legal departments. Hopefully, Aiscension is going to be taking a lot of inbound calls and requests to better understand the service that it is providing, because it is a real problem solver. And it’s a way for companies to be proactive, rather than reactive, when things happen. 

combined with legal expertise, is that the faster you can find the issue, the faster you can work with the regulators and the government agencies, the more opportunity there is for a company to remediate these problems. It’s an extremely time-sensitive and expensive proposition if your company gets caught up in this kind of situation.

Jisa: Just to add to that, with regards to the cartel model that we’ve developed for Aiscension, I have to say that CCBJ readers, those in corporate legal departments, are some of the most opportunistic targets – they have the most issues with this, as do governments, right? Governments around the world need to get these answers more quickly, in order to save time. It’s critical for them. What’s unique about this is that Aiscension will be selling this cartel model to its customers, and we’ll also be able to leverage Reveal’s team as well, to go out there and deliver that to our customers as well.

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Wendell Jisa is CEO of Reveal, bringing 20 years of technology services and experience to the legal industry. As CEO, Wendell leads the international company with offices throughout North America and Europe. Reach him at wjisa@revealdata.com.

Jay Leib is executive vice president, innovation & strategy with Reveal. In his role, he is responsible for Reveal platform’s innovation and strategy and tasked with accelerating the adoption of Reveal’s Brainspace and NexLP artificial intelligence technology.

Reach him at jleib@revealdata.com.

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