Seyfarth’s real estate team provides a bird's-eye view of the current state of commercial real estate throughout the country—highlighting which markets and major asset types are active, slowing down, or experiencing shifts.

Seyfarth’s Take: What to Know

✔ Opportunities: Data centers remain the primary growth engine, with continued acceleration in Texas, the Midwest, and key coastal markets. Industrial has stabilized as a consistent, reliable performer across most regions. Multifamily is becoming more market selective, while retail has stabilized broadly, with pockets of strength in high-growth metros and well-located corridors.
✔ Challenges: Market divergence is becoming more pronounced. Office fundamentals remain uneven, with certain markets still experiencing elevated vacancy and valuation pressure. Multifamily softness persists in some Sun Belt markets, where supply remains high. At the same time, cost pressures, interest rates, development costs, infrastructure limitations, and regulatory constraints are reinforcing a more disciplined and cautious investment approach.
✔ Market Trend: The current CRE landscape is a highly differentiated, market-by-market environment. Capital and leasing activity are concentrating in high-performing asset classes and submarkets rather than lifting all sectors uniformly. Data centers remain the dominant driver of demand and infrastructure investment, while broader market conditions show stabilization with persistent region and sector variability. As a result, success increasingly depends on precise asset selection, local market fundamentals, and alignment with long-term demand drivers.

Regional Rundown

“The Atlanta market remains stable quarter over quarter, with no significant shifts across asset classes. Data center development continues to lead activity. Industrial and logistics are seeing improving vacancy rates amid limited new supply, while retail holds steady. Multifamily fundamentals are improving but still pressured by elevated vacancies from the large number of recently completed projects. The office sector remains in recovery, with leasing concentrated in newer and recently renovated properties offering strong amenity packages.” Kwame Benjamin, Partner

“Multifamily housing continues to lead the way in the Boston real estate market. However, despite a solid local economy, an increasing number of developers and investors are starting to exercise caution due to rising costs, stubborn interest rates, and a looming statewide rent control referendum in November.” Catherine Burns, Partner and Eric Greenberg, Partner

“The Charlotte market continues to chug along at a steady pace in virtually all asset classes.” Eric Sidman, Partner

“The Chicago commercial real estate landscape has remained stable, with data centers and industrial leading in demand, multifamily and retail holding relatively steady, and the office sector still underperforming.” Michael Merar, Partner and Tobi Pinsky, Partner

“Recent industry reports indicate that Dallas has emerged as the leading global market for data center development.” Amy Simpson, Partner

“Data center development in Houston and across Texas remains highly active, driving significant projected power demand growth, with most large ERCOT interconnection requests tied to data centers. Industrial continues to perform well, with strong development and leasing activity, while retail is gaining momentum. In contrast, multifamily is considered overbuilt in Houston, and the office sector continues to face challenges.” Peter Oxman, Partner

“In Los Angeles, the data center market remains strong, with high demand and limited supply. Multifamily demand is steady, though rents are largely flat. Industrial vacancies are elevated, but leasing is improving. The office sector remains weak but is beginning to stabilize, with some submarkets outperforming. Retail fundamentals are solid, though performance varies by asset type and location.” Tim Farahnik, Partner and Stacy Paek, Partner

“The New York commercial real estate market has seen little change since spring, with multifamily continuing to lead in terms of activity; industrial, data centers, and retail holding steady; and the office sector still facing comparatively weaker conditions.” Miles Borden, Partner and Cynthia Mitchell, Partner

“In San Francisco, market conditions remain largely unchanged from April, with continued improvement across several asset classes, including office, supported by ongoing AI-driven growth, a more pro-business environment, and increasing return-to-office momentum. There is also growing market buzz around potential AI-related capital markets activity, reflecting sustained investor interest in the sector.” Robin Freeman, Partner

“In Seattle, data center activity remains robust, the industrial market has entered a more stable phase, and multifamily fundamentals are gradually improving. Office continues to face elevated vacancy driven by hybrid work, while retail is showing signs of recovery, supported by improving foot traffic and selective leasing activity.” Jami Balint, Partner

“After lagging behind other asset classes for the past few years, the office sector in Washington, DC is beginning to show signs of life. Tenant concessions are down, and workers are returning to the office at nearly pre-pandemic levels. Trophy class office continues to attract the most tenant interest, while Class B office struggles.” James O’Brien, Partner

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The Washington State Human Rights Commission (“WSHRC”) voted to adopt the resolution amid growing concerns about antisemitism. During the Commission’s deliberations, however, Commissioner Luc fils Jasmin made remarks that many argued invoked longstanding antisemitic tropes and stereotypes, shifting attention away from the resolution itself and toward questions about the Commission’s credibility, combating bias within its own ranks, and its commitment to fighting anti-Jewish bigotry.

The controversy carries particular significance because the WSHRC is responsible for enforcing Washington’s Law Against Discrimination, promoting equal opportunity throughout the state, and investigating discrimination complaints. Like any civil rights agency, its effectiveness depends on public confidence that allegations of discrimination will be addressed fairly, impartially, and without regard to the identity of those involved.

Before turning to the controversy, it is worth examining what the Commission’s resolution says.

What the Resolution Says

The resolution affirms that Jewish individuals in Washington are entitled to live, worship, participate in public life, work, and learn free from violence, threats, intimidation, discrimination, and harassment. It condemns antisemitism in all forms and expresses concern regarding rising antisemitic rhetoric and incidents.

The Commission’s resolution also states that criticism of Israel or Zionism is not inherently antisemitic. To many, this framing minimizes the ongoing and often complex debate about when political expression may, in particular contexts, intersect with antisemitism—especially where rhetoric invokes Jewish stereotypes, denies Jewish self-determination, or targets individuals based on Jewish identity.

What Happened?

During recorded debate over the proposed antisemitism resolution, Commissioner Jasmin questioned why the Commission was even considering a resolution specifically addressing antisemitism.

Among other comments, Commissioner Jasmin stated:

“This word antisemitism has been around since the Jews got trampled by Hitler, and it seems like the Jewish people keep on crying, and crying, and crying and crying, always crying over the antisemitism. Today, there are many other groups who are subject to mistreatment, or even subject to mistreatment by the Jewish, and they're not crying so much. Why is antisemitism carrying on until the century 2000, and everybody’s folding down to that?”

He further opined:

“Wherever I've been throughout my life, it’s Jewish always crying, and now they're trying to get the Human Rights Commission to write special conditions for them.”

At another point during the discussion, Commissioner Jasmin remarked:

“We are under duress.”

He also argued that the Commission should address the treatment of Palestinians alongside antisemitism, referring to “these people the Jewish are killing by the millions over there—the Palestinians and the Arabs.”

The suggestion that Jews exaggerate antisemitism, seek special treatment, or that Jews in Washington bear collective responsibility for actions, or alleged actions of other Jews, reflects themes that have appeared throughout history in antisemitic rhetoric.

Several commissioners pushed back. Commissioner Hân Trân challenged the remarks, while Commission Chair Jeff Sbaih emphasized that addressing antisemitism falls squarely within the Commission’s mandate. 

Despite Commissioner Jasmin’s comments, the Commission ultimately adopted the resolution.

Why It Matters

Trust in civil rights institutions is critical, particularly because enforcement depends on individuals coming forward to report discrimination. Remarks that dismiss or minimize concerns about antisemitism risk undermining confidence in the Commission’s ability to address complaints fairly and impartially. For an agency whose effectiveness depends on voluntary participation, perceived bias can be almost as damaging as actual bias.

In many respects, the controversy demonstrates that, whether in the public or private sphere, the success of anti-discrimination initiatives depends not only on the policies an institution adopts, but also on the confidence stakeholders have in the individuals responsible for implementing them.

Employer Takeaways

Against this backdrop, the implications extend beyond public agencies to private employers.

Train Leaders to Address Sensitive Issues Carefully 

Train leaders to avoid language that could be perceived as denigrative or dismissive of concerns raised by protected groups. Even absent unlawful conduct, such statements can erode trust and increase workplace risk. The purpose of leaders is in nearly all cases to grow the bottom line, not to wade into fraught political issues. Recentering leaders on the need for them to create a culture focused on productivity and retaining top talent is helpful in mitigating risk of leaders discussing fraught non-work related topics at work.

Ensure Complaint Processes Are Consistent and Trusted

Employees are more likely to trust workplace complaint processes when they believe concerns will be treated consistently, respectfully, and impartially. Comments from leaders and management can significantly affect employee confidence in workplace reporting and investigation processes. Leaders should use Company policy and past practice to ensure consistent decision making. Leaders should not feel it is their job to decide complex social and political issues.

Investigate Complaints Without Assumptions

Evaluate complaints based on specific conduct rather than assumptions tied to identity, religion, or geopolitical issues. Avoid allowing stereotypes or preconceived notions to influence investigative outcomes.

Stereotypes and Generalizations Can Create Risk

Framing issues in ways that rely on stereotypes or tropes—rather than individualized conduct—can undermine inclusion efforts and increase exposure under anti-discrimination laws. Regardless of context, workplace comments that suggest a protected class exaggerates discrimination, seeks preferential treatment, or bears collective responsibility for the actions of others can raise significant legal and employee-relations concerns..

Political Discussions May Raise Workplace Concerns

The resolution suggests that criticism of Israel and Zionism is not inherently antisemitic. At the same time, employers should avoid assuming that all complaints involving discussions of Israel, Zionism, or the Israeli-Palestinian conflict are merely political disputes; depending on the facts, such conduct may implicate anti-discrimination or anti-harassment obligations. Employers should evaluate workplace complaints based on the specific conduct and statements at issue rather than the political viewpoint being expressed. Employers may also seek to further deescalate workplace tension by enacting policies, that while conscious of worker protections under the National Labor Relations Act, restrict workplace discussions of hot-button social and political issues.

Review Discrimination, Harassment, and Accommodation Practices

Employers should review their policies and procedures addressing religious discrimination, harassment, and retaliation to ensure they clearly prohibit unlawful conduct and provide employees with effective avenues for reporting concerns. Employers should also confirm that complaints involving religion and national origin discrimination are investigated promptly, consistently, and objectively, and that leaders and managers are trained to recognize and address potential issues before they escalate.

Consistent administration of anti-discrimination policies can reduce legal risk, strengthen employee confidence in workplace complaint processes, and reinforce a culture of inclusion and respect.

Bottom Line

For employers, the takeaway is straightforward: policies alone are not enough. Their effectiveness depends on the trust employees place in those who enforce them. When leaders or managers appear to dismiss concerns raised by a protected group—or rely on tropes or stereotypes—the resulting loss of confidence can undermine even well-designed compliance programs.

Welcome back to The Week in Weed, your Friday look at what’s happening in the world of legalized marijuana. This week, we have more news from Virginia. Trulieve lists on Wall Street. Idaho could prohibit cannabis legalization ballot initiatives. And finally, the WNBA now permits its players to use cannabis.

VIRGINIA

This was the year that the Old Dominion was supposed to get a retail cannabis market. But, that didn’t happen. Cue the Charlie Brown football analogy, with Governor Abigail Spanberger in the Lucy role. But wait! Could there be a way forward for cannabis sales after all? Well, possibly. The Governor and members of the legislature are in discussions over a budget bill right now, and cannabis could become a part of that. Of course, only time will tell…

TRULIEVE

Nothing says mainstream business success like a listing on the New York Stock Exchange (NYSE). And this week, Trulieve became the first U.S. cannabis company to appear on the world’s largest stock exchange. Trading under the symbol TRLV, company shares were available to buy and sell starting Wednesday. This is possible because medical marijuana was rescheduled, and Trulieve completed a corporate restructuring that decoupled its medical operations from its adult-use activities.

IDAHO

As we’ve been in many states across the country, sometimes cannabis is legalized by a ballot initiative. In Idaho, there’s a move afoot to make sure that doesn’t happen. Voters in the Gem State (and we’ve discussed Idaho so much in this column that we no longer need to look up its nickname) may be presented with two cannabis options on the November ballot. One would legalize medical marijuana in the state. Supporters of the measure have turned in what they believe are more than enough signatures to ensure it will appear on the ballot. The other measure would dictate that only the legislature could legalize cannabis or other controlled substances. Will voters vote to deny themselves the right to vote on this issue? And what if both measures pass? Which measure will take precedence? Stay tuned!

AND FINALLY

Earlier this month, the WNBA and the Women’s National Basketball Players Association (WNBPA) reached a new collective bargaining agreement. One noteworthy change from previous agreements is that cannabis was removed from the banned substances list.

Be well everyone – we’ll see you next week.

Collectively, the coverage highlights the firm’s continued investment in high-growth markets, its deepening capabilities along the New York–Miami–Latin America corridor, and the strategic importance of its new Miami platform under the leadership of Juan Carlos Varela, who joins as office managing partner and chair of the firm’s Latin America practice.

In an interview with Law360, Varela emphasized the value of Seyfarth’s integrated, multidisciplinary platform in serving clients with increasingly complex, cross-border needs, explaining:

“Clients increasingly sought broader, more comprehensive advice beyond labor and employment, and the new firm allows me to meet those needs more effectively through an integrated, multidisciplinary platform.”

Similarly, Am Law's Daily Business Review underscored Miami’s growing importance as a strategic hub for companies operating across the Americas, quoting Varela on the market’s rising significance:

“For companies operating throughout the Americas, the market has become increasingly important as they navigate complex regulatory, commercial and geopolitical issues, including questions of whether, when and how to move forward across markets.”

Additional coverage from Latin Lawyer highlighted the broader market dynamics driving Seyfarth’s expansion, including strong economic momentum and cross-border demand. As Seyfarth Chair and Managing Partner Lorie Almon noted:

“There’s some macroeconomic momentum in Miami, sustained client demand on our side, really strong cross-border and geopolitical tailwinds, and then most importantly, the fact that we’ve identified the right leadership to anchor a very strong platform.”

In addition to coverage in US legal and business press, the announcement was widely syndicated across numerous Latin American media outlets, further amplifying recognition of the launch as a significant step in strengthening the firm’s ability to support multinational clients navigating increasingly complex regulatory and business environments throughout the Americas.

The 2026 New York State legislative session, which concluded in early June, saw a number of bills that passed both the Assembly and Senate and may become law. The ultimate fate of the bills, however, remains in flux, as it is uncertain whether they will ever be formally “delivered” to the Governor for her consideration, and if so whether she will approve or veto them. That uncertainty may last through the end of December 2026, although further action on any of the bills might occur at any time before then.

New York employers should be aware of these potential enactments so that they can be prepared to come into compliance if necessary, as many of them would make foundational changes in state employment law. Below are summaries of the bills.

• The “No Severance Ultimatums Act” (S372A): This bill would impose new requirements on severance agreements offered in connection with separation of employment. Specifically, employers would be required to provide employees with: (i) written notice of the right to consult an attorney, (ii) at least 21 calendar days to consider the agreement, and (iii) a 7-day revocation period following execution of the agreement. The bill further requires that an employee’s decision to accept a severance agreement be “knowing, voluntary, and not induced by the employer through fraud [or] misrepresentation.” The legislation largely mirrors the federal Older Workers Benefit Protection Act, but would extend similar protections to employees of all ages. A substantially similar bill (discussed here) failed to pass during the 2025 legislative session.
• Job Posting Disclosures (S08877): This bill would impose disclosure requirements for job advertisements issued by employers with at least 100 employees, as well as third-party job posting entities. Covered postings would be required to specify whether the position is a current vacancy expected to be filled within or after 90 days, or whether the employer is accepting applications for future roles. Employers would also be required to remove postings within two weeks after a position is filled, and to notify third-party platforms when they reasonably believe a posting remains active. Violations could result in civil penalties of up to $2,500 per posting, with increased penalties for continued noncompliance.
• Non-Compete Restrictions (S09759): This bill would prohibit employers from requiring or enforcing non-compete agreements against most workers in New York, subject to certain exceptions. The exceptions include agreements with “highly compensated individuals,” defined by an annual compensation threshold; other restrictive covenants, such as confidentiality and client non-solicitation provisions, that do not function as non-competes; and non-compete provisions entered in connection with the sale of a business. The bill also authorizes private rights of action and permits courts to award injunctive relief, damages, and attorneys’ fees for violations. After failing to pass the Assembly in 2025, this new bill passed the Senate in the closing days of the 2026 legislative session, but did not progress to a vote in the Assembly. However, under New York legislative procedure, the bill may roll over into the 2027 session, starting in January. So while this bill is stalled for now, it may come back to life next year. (A broader prohibition of non-competes passed both chambers in 2024, but was vetoed by the Governor.)

Other bills that passed both chambers in the 2026 legislative session include:

• Access to Personnel Records (S3460): This bill would require employers to provide employees with access to their personnel records and would impose significant obligations on employers. For more information, see here.
• The Anti-Waiver of Employment Rights Act (S4424‑A): This bill would place broad prohibitions on contractual limitations of employees’ statutory rights. For more information, see here.

In addition, the “Trapped at Work Act” (S04070B) will take effect in December 2026 after Governor Hochul signed amendments into law on February 13, 2026. For more information, see here.

Seyfarth will continue to monitor developments in this space and provide updates when available. In the meantime, feel free to reach out to any of the authors of this alert, or your regular Seyfarth contact, with any questions.

*Emily Cronin is a Summer Associate on Seyfarth’s Labor & Employment team. Many thanks for her contribution to this update.

Robinson v. Marshfield – The SJC’s Analysis

Kevin Robinson served as Fire Chief for the Town of Marshfield since 2003 and maintained an exemplary performance record throughout his career. Robinson’s niece, Shauna, was hired as a probationary firefighter in 2013. During her one-year probationary period, multiple supervisors raised concerns regarding Shauna’s progress with training. Instead of giving her additional training, the town administrator recommended that Robinson terminate her. Robinson refused and complained that other male firefighters with similar performance deficiencies had received additional training. Following his complaint, Robinson faced a series of adverse employment actions, including that he was the subject of an ethics investigation, his contract was not renewed, and his salary was not increased. Finally, he was ultimately placed on administrative leave.

Robinson subsequently brought suit against the town, alleging retaliation under G. L. c. 151B, § 4(4), among other claims. A jury found the town had retaliated against him and awarded him $300,000 in compensatory damages for emotional distress and $1.1 million in punitive damages. The town moved for judgment notwithstanding the verdict, arguing that the jury instructions improperly blended pretext and mixed-motive frameworks and thus a new trial was warranted.

On appeal, the SJC affirmed the jury’s verdict, concluding that sufficient evidence supported a retaliation finding. In assessing the jury instructions, the SJC examined the distinction between pretext and mixed-motive standards and acknowledged that the trial judge erred by introducing mixed-motive concepts into what was fundamentally a pretext case. Despite this instructional error, the SJC held that the error was non-prejudicial because the jury made the findings required under the correct pretext framework, including intentional retaliation and a direct causal connection between Robinson’s protected activity and the adverse employment decisions. The court emphasized that the instructions, when viewed as a whole, were adequate and that the jury’s findings left no doubt as to their ultimate conclusions under the correct legal standard. Additionally, the SJC reasoned that the jury’s award of punitive damages reflected a finding of “extreme and outrageous” conduct by the town.

Improper Jury Instructions: Blending Pretext and Mixed-Motive Instructions

In discrimination and retaliation cases, the trial judge is responsible for deciding whether to give a pretext or mixed-motive instruction to the jury. A pretext instruction (most common) is appropriate where the plaintiff’s evidence of alleged discrimination or retaliation is indirect or circumstantial. A mixed-motive instruction, on the other hand, is appropriate where the plaintiff has presented direct evidence of discrimination or retaliation.  Direct evidence would include, for example, an oral or written statement by a decision-maker that is discriminatory or retaliatory.   

Although the SJC deemed the instruction error harmless in Robinson, the difference between the two instructions is significant. In an indirect discrimination case, where the court uses the pretext analysis, the burden is on the plaintiff to prove that the employer’s reason for the adverse action was not the true reason but merely a “pretext” for an illegitimate motive, such as retaliation or discrimination. This framework requires “but-for” causation—that the adverse action would not have occurred but for the protected activity. The ultimate burden of proof remains with the plaintiff, who must persuade the factfinder that either an illegitimate motive more likely caused the employer’s adverse action or demonstrate that the employer’s proffered explanation is unworthy of credence. In cases presenting direct evidence of discrimination, the court applies the mixed-motive analysis and the plaintiff must show that the plaintiff’s protected class or protected activity was a “motivating factor” in the adverse decision, even if other legitimate reasons also played a role. The mixed-motive framework also places an additional burden on the employer to show that its legitimate reason alone would have led to the same action.

In Robinson, the trial judge introduced mixed-motive concepts into both the jury instructions and special verdict form despite the plaintiff presenting no direct evidence of discrimination or retaliation. Blending these instructions is problematic for several reasons. First, it risks confusing the jury, which may be unable to distinguish between the different causation standards, potentially leading to inconsistent or legally erroneous verdicts. Second, it risks misapplying the causation standard, as the jury may apply the more lenient “motivating factor” standard in a case requiring “but-for” causation, or vice versa, which can affect both the outcome and available remedies. Finally, it increases the likelihood of reversible error on appeal, as appellate courts may find that the jury was not properly instructed on the applicable law.

Practical Guidance for Employers

The application of either the pretext or mixed-motive framework depends on the strength of the plaintiff’s evidence. While employers cannot choose the framework, they can strategically advocate for proper jury instructions based on the evidence presented. Because the pretext framework sets a higher bar for plaintiffs, employers should press for a pretext instruction when possible and oppose a mixed-motive instruction unless there is direct discriminatory or retaliatory evidence clearly warranting a mixed motive instruction.

A key factor in the Robinson case was that both the plaintiff and the town had contributed to the portions of the jury instructions and verdict forms that the Court ultimately blended in creating the final instructions for the jury. The decision serves as a strong reminder that counsel must pay close attention to the final jury instructions proposed by the Court and make adequate objections during the trial charge conference if they sense any prejudice from either the jury instructions or the verdict slip.

*Pechsiree Pechvijitra is a Summer Associate on Seyfarth’s Labor & Employment team. Many thanks for her contribution to this update.

Seyfarth Synopsis: In a noteworthy ruling from the District of Colorado, the Court awarded A&A Appliance, Inc. (“A&A”) a full award of attorneys’ fees, deeming the Equal Employment Opportunity Commission’s claims “frivolous, unreasonable, and without foundation.” The decision in EEOC v. A&A, No. 23-cv-02456 (D. Colo.) offers employers a potential roadmap for pushing back on questionable EEOC litigation.

The ruling underscores that, under the right circumstances, courts are willing to closely scrutinize the evidentiary support behind EEOC claims, particularly where the agency has had years to investigate before filing suit, and to impose consequences where that support is lacking.

The decision equips employers with stronger arguments to challenge weak cases early, creates potential leverage to seek recovery of full defense costs, and provides additional pressure points in settlement negotiations where the EEOC’s claims cannot withstand scrutiny.

Relevant Case Background

This case involves allegations that A&A violated the Americans with Disabilities Act by failing to accommodate Karima Javanzad and terminating her employment.

In April 2020, Ms. Javanzad requested twelve weeks of leave under the Family and Medical Leave Act for reasons that varied, including contracting COVID-19, caring for her son with COVID-19 or pneumonia, or an ailing from a gastrointestinal condition. A&A approved retroactive leave from March 15 to June 7. After weeks of communication about her leave and a possible extension, A&A terminated Ms. Javanzad for failing to return to work, stating it would not extend leave for her gastrointestinal condition, as it was unrelated to her COVID-19 diagnosis.

Both parties later moved for summary judgment. On September 3, 2025, the court granted A&A’s motion, holding the EEOC failed to establish a prima facie case because A&A lacked notice of a disability requiring accommodation.

The Court’s Analysis and Decision

The Court concluded that the defendant was entitled to attorney’s fees because the EEOC’s claims were “frivolous, unreasonable, or groundless” under Christiansburg v. EEOC, 434 U.S. 412, 422 (1978).

The Court first recognized that the Tenth Circuit (which includes Colorado) has affirmed the Eleventh Circuit’s factors to determine whether a claim is “frivolous, unreasonable or groundless” under Christiansburg. Those factors include: (1) whether the plaintiff established a prima facie case; (2) whether the defendant offered to settle; and (3) whether the trial court dismissed the case prior to trial. Here, all of these factors supported a fee award, as the EEOC failed to establish a prima facie case, the defendant offered to settle, and the case was dismissed on summary judgment.

The Court also addressed the EEOC’s preferred formulation of Christiansburg – that fees are warranted only where a plaintiff “utterly fails to produce any evidence” supporting essential elements. The Court rejected that as the exclusive test, explaining the EEOC’s version was just one way to satisfy the fee-shifting standard, not the only one.

But the Court found the EEOC failed even under its own heightened standard. The EEOC produced no evidence that the employer knew of the alleged disability, which is an essential element of its claims. Emails referencing “health conditions” and leave requests were insufficient to show knowledge of a qualifying disability. That failure alone justified summary judgment, and supported an award of attorneys’ fees incurred by A&A in connection with the litigation.

The Court further found the EEOC acted unreasonably in continuing to litigate despite this defect, particularly given it had years to investigate the matter before filing its lawsuit, and possessed facts undermining its claims from the outset.

Finally, and importantly, the Court recognized, quoting Christiansburg, that “[a] district court may consider distinctions between the Commission and private plaintiffs in determining the reasonableness of the Commission’s litigation efforts” (quotations omitted). As such, the Court held: “Ms. Jazanzad might have been excused from pressing these issues. The EEOC is not.”

Implications for Employers

This decision offers several important takeaways for employers facing EEOC enforcement actions. While uncommon, this case confirms that courts can award attorneys’ fees where the EEOC pursues claims lacking any evidentiary support. In this case, as well as another district court decision we recently covered here, the employer’s lack of knowledge alone was sufficient to warrant summary judgment. As EEOC v. A&A demonstrates, failure to produce evidence on a single required element can justify both summary judgment and in rare instances, a fee award. The prospect of fee-shifting can be a powerful negotiation tool, as well. Where a case is plainly meritless, raising the risk that the EEOC may be required to pay defense costs can create meaningful pressure for early resolution. Indeed, this opinion recognizes that courts may scrutinize the EEOC more closely than private plaintiffs, given its duties to investigate and cease pursuing unsupported claims.

Taylor is the 11th Real Estate partner to make a lateral move to Seyfarth since the start of 2025 – and the fifth since the beginning of 2026, including three in Texas. Seyfarth’s Real Estate practice is among the largest in the country.

Taylor brings more than 30 years of experience to Seyfarth, having counseled clients on commercial real estate transactions of all asset types, primarily representing developers and owners. Clients have entrusted Taylor with a wide range of significant matters involving office and retail leasing, acquisitions, dispositions, financing, and development of real property. 

Taylor is widely recognized in the industry and has held leadership roles with the planning committee for the ICSC +US Law Conference presented by the International Council of Shopping Centers (ICSC) and with the American College of Real Estate Lawyers (ACREL). In 2025, she was inducted into the Texas Women’s Hall of Fame by the Greater Houston Women’s Chamber of Commerce, an honor recognizing women who “innovate, uplift communities, break ceilings, and redefine leadership.”

“Connie’s outstanding real estate practice is multi-faceted and well-aligned with Seyfarth’s national platform,” said Paul Mattingly, national chair of Seyfarth’s Real Estate department. “Her deep experience in retail and office leasing, development, and sophisticated real estate transactions—combined with her reputation in the industry—positions her as a high-profile addition to our team. We are excited to have Connie join us with her vast experience and proven leadership.”

Taylor counsels both buyers and sellers of office and retail assets in major metropolitan and suburban areas across the United States, ranging from single assets to multi-asset portfolios.

She also represents clients in financing, refinancing, and loan assumptions involving office buildings, retail shopping centers and industrial/logistics projects in Houston and other large US cities. Her work includes several portfolio financings for development funds.

"I couldn’t be more excited to welcome Connie to our full-service, market-leading Houston office. Connie will be an incredible addition to one of our powerhouse departments—real estate—in addition to our strengths across labor & employment, litigation, and corporate,” said Suzanna Bonham, managing partner for Seyfarth’s Houston office. “Her decision to join Seyfarth after more than three decades at Baker Botts speaks volumes about the momentum we’re building and the power of our platform—particularly our focus on innovation, technology, and a deeply client-centered approach. Connie brings exceptional experience, a strong reputation in the market, and a collaborative leadership style that fits seamlessly with how we work. I am especially energized about what her addition means for our clients and the continued growth of our Houston office.”

Taylor has represented landlords in office and retail leasing transactions involving up to one million square feet in a single deal. Taylor’s tenant representations include the lease of approximately half-a -million square feet for a major utility company, as well as leases ranging from 10,000 to over 100,000 square feet for energy companies and other corporate clients.

“Seyfarth’s nationally integrated real estate platform presents a compelling opportunity to expand the way I serve my clients,” said Taylor. “The firm’s collaborative approach and strength in Texas and across the country position it for continued growth. I am excited to join the team in Houston and contribute to that momentum.”

Taylor’s leadership and industry impact have earned significant recognition. She is recognized as one of the “500 Leading Real Estate Lawyers” by Lawdragon and was named “Lawyer of the Year” in Real Estate Law by The Best Lawyers in America in 2023. She is consistently ranked by Chambers USA and Best Lawyers. Taylor earned her JD at Tulane University Law School and her BA at the University of Houston.

About Seyfarth’s Real Estate Department

Seyfarth’s world-class real estate team serves sophisticated clients across a number of industries. Recognized as one of the largest real estate practices in the US, we have built an integrated team that serves local, regional, and national clients on the acquisition, financing, development, leasing, restructuring, servicing, and disposition of noteworthy real estate assets and portfolios. This experience extends across comprehensive array of asset classes, including office, industrial, multifamily, retail, health care, and data center projects. We leverage our size and depth to partner with clients and to invest in material enhancements in how commercial real estate law is practiced.

About Seyfarth’s Houston office 

For more than 30 years, Seyfarth’s Houston office has been a key hub of legal service excellence for the Lone Star state. Home to some 50 attorneys who place a high premium on client service, the office services the full range of the firm’s clients’ needs. With deep practices in litigation, corporate, real estate, labor & employment, and intellectual property, the office is able to handle the gamut of needs of clients in the health care, energy, financial services, technology, chemicals, retail, transportation and logistics, and other sectors. Seyfarth Houston is proud of its strong ties to the community and its commitment to driving innovation in the profession.

About Seyfarth Shaw LLP

With more than 1,000 lawyers across 18 offices, Seyfarth Shaw LLP provides advisory, litigation, and transactional legal services to clients worldwide. The firm is recognized for its innovative approach, advancing the standard of legal service delivery in an evolving global marketplace.

Seyfarth works alongside clients to capitalize on opportunities and solve complex challenges across capabilities, including corporate, litigation, real estate, regulatory compliance, labor and employment, and executive compensation and employee benefits. Committed to collaboration and a client-centered approach, Seyfarth delivers solutions as sophisticated as the challenges clients face.

Jesse Coleman, Gary Friedman, and Eron Reid led a practical discussion for in-house counsel, HR professionals, executives, and business leaders navigating an increasingly complex enforcement and compliance environment.

View the Recording – CLE credit for this recording expires on May 27, 2027. Please refer to the program description for jurisdiction-specific details and deadlines.

Key Takeaways

FTC Enforcement Has Shifted to a Case-by-Case Approach

Under new leadership, the FTC has moved away from attempting to impose a categorical ban on non-competes and instead is pursuing a case-by-case enforcement strategy. This approach applies a reasonableness standard similar to those long used by many states.

While the rulemaking effort may be behind us, federal scrutiny of restrictive covenants remains active—now focused on specific fact patterns rather than broad prohibitions.

Enforcement Is Targeting Overbroad Use of Non-Competes

Early enforcement actions indicate that the FTC is focusing on clear overuse and overreach, particularly where non-competes are:

• Applied broadly across employee populations
• Untethered to role, seniority, or access to sensitive information
• Used as a default rather than a tailored protection

These actions reinforce that employers should avoid “one-size-fits-all” restrictions and instead ensure covenants are narrowly aligned to legitimate business interests.

Healthcare Remains a Key Area of Focus

The health care industry continues to be a priority for enforcement, particularly where restrictive covenants are perceived to limit patient choice or access to care.

Employers in this space should expect continued scrutiny of non-competes involving physicians and other clinical professionals, especially in highly competitive or underserved markets.

“Education Through Enforcement” Will Continue

The FTC is expected to continue leveraging targeted enforcement actions as a tool to shape the law, effectively providing guidance through test cases and settlements.

This “education through enforcement” approach means employers should closely monitor developments, as each action may further define the boundaries of acceptable restrictive covenant practices.

State Law Patchwork Is Expanding

At the same time, employers face an increasingly complex patchwork of state laws governing non-competes and other restrictive covenants. These laws vary significantly and may include:

• Wage thresholds restricting enforceability
• Advance notice requirements
• Industry-specific limitations or outright bans

As a result, compliance must be managed on a jurisdiction-by-jurisdiction basis, with careful attention to applicable state requirements.

Uniform Agreements Are No Longer Sustainable

Given the divergence in state laws, multi-state employers can no longer rely on uniform agreements.

Instead, employers should consider:

• Modular agreements that adjust based on employee location
• State-specific templates tailored to local legal requirements

This approach helps balance enforceability with administrative efficiency while reducing legal risk.

Choice-of-Law Strategy Requires Reassessment

Employers should also re-evaluate whether to default to Delaware law when drafting restrictive covenants.

Although Delaware has traditionally been a preferred jurisdiction—particularly for companies incorporated there—its jurisprudence on restrictive covenants has shifted over the past several years and remains in flux.

Companies should:

• Assess whether Delaware has a meaningful nexus to the employment relationship
• Consider whether another jurisdiction tied to the workforce or business operations may provide a more reliable enforcement forum
• Avoid reflexively selecting Delaware without evaluating current legal trends

Looking Ahead

Although the FTC’s non-compete rule is no longer in effect, the broader movement to limit restrictive covenants continues to gain momentum through both federal enforcement and state legislation. Employers should take a proactive approach by tailoring agreements, strengthening alternative protections, and staying attuned to ongoing legal developments.

To ensure you don’t miss future sessions, subscribe to our Litigation – Trade Secrets & Non-Competes mailing list. For tailored programs, our attorneys are available to present customized sessions for your organization. Subscribe to our Trading Secrets blog for ongoing insights on trade secrets, employee mobility, and information governance.

Seyfarth has merited strong recognition in the 2026 edition of The Legal 500 United States, with 17 practice group rankings and 98 individual lawyer rankings, including 33 distinguished rankings.

Three Seyfarth practice groups achieved “Top-Tier” status—the publication’s highest recognition: Corporate Middle-Market M&A, Labor-Management Relations, and Workplace and Employment Counseling.

An additional 14 practice groups received national rankings:

• Construction Real Estate
• Cyber Law
• E-Discovery
• Employee Benefits, Executive Compensation and Retirement Plans: Design
• ERISA Litigation
• Government Contracts
• Immigration
• Labor & Employment Disputes
• Private Equity Funds
• Real Estate
• Real Estate Finance
• Securities Litigation: Defense
• Tax: Not-For-Profit
• Trade Secrets

Based on feedback from corporate counsel, the following attorneys were recognized as Leading Lawyers: Alison Ashford, Kathleen Cahill Slaught, Diane Dygert, Gary Friedman, Zachary Jacobson, Ofer Lion, Lawrence Lorber, Andrew Lucano, Dawn Mertineit, Ian Morrison, Camille Olson, Josh Salinas, Vincent Sama, Glenn Smith, and Michael Wexler.

The Legal 500 Hall of Fame recognizes lawyers who have received consistent client praise for sustained excellence. Seyfarth’s honorees include: David Baffa, Gary Friedman, Bennett Greenberg, Camille Olson, Bill Perkins, Leon Rodriguez, and Suzanne Saxman.

The Next Generation Lawyers category highlights rising lawyers making a significant impact nationwide. Seyfarth’s recognized attorneys include: Edward Arnold, Erica Bakies, Aaron Gillett, Amy Hoang, Bryan O'Keefe, Jaime Raba, Karla Sanchez, Joshua Seidman, Breanne Vaclavik, and Michael Wagner.

The Legal 500 United States is an annual legal directory that evaluates and ranks law firms and lawyers based on client feedback, firm submissions, and independent research.

View Seyfarth's complete rankings here.

This year’s chapter reflects continued market shifts and heightened regulatory scrutiny, providing valuable insights for legal professionals, investors, and industry stakeholders navigating complex health care transactions. Drawing on the experience of Seyfarth’s multidisciplinary team, we explore both foundational concepts and emerging developments influencing deal activity across the sector.

Key topics covered include:

• Market trends and deal dynamics in health care M&A, including start-up formation, early-stage financing, and venture capital structures
• Liquidity pathways such as IPOs, private sales, hybrid strategies, and spin-offs/strategic realignments
• Transaction structures, valuation considerations, and acquisitions of public health care companies (including tender offers and mergers)
• Evolving regulatory landscape, including antitrust enforcement, state transaction review laws, and foreign investment considerations
• Data privacy, compliance, and diligence issues unique to the health care sector, along with disclosure, governance, and directors’ duties

Click here to access the publication. Please feel free to also reach out to Madeline Perkovich with any questions or feedback.

International Employment Lawyer quoted Sam Schwartz-Fenwick, co-chair of Seyfarth's Cultural Flashpoints task force, in its article, “Wizards of the Coast in hot water after using deadnames in NLRB filings.” The piece, published on June 9, 2026, examines legal and employee relations risks tied to the use of legal names rather than preferred names in union election filings.

Schwartz-Fenwick explained, “The NLRB does not require that an employee’s legal name appear on the voting list for a representation election. The [regional branch of the NLRB] should encourage the employer to produce the list using the names that the employees use at work, which may not be their legal name.”

He further noted the potential exposure for employers, adding: “It could give rise to a hostile workplace claim under state law in those states that expressly protect gender identity and/or expression. In addition, it could be the basis of a federal hostile workplace claim under Title VII.”

The full article is available here.

Bloomberg Law quoted Sam Schwartz‑Fenwick, co-chair of Seyfarth's Cultural Flashpoints task force, in its article, “Trump Leaders Blur Church, State Line in Federal Worker Messages.” The piece, published on June 9, 2026, examines how increased religious messaging from federal leadership may test constitutional boundaries and create Title VII risks in the workplace.

Schwartz‑Fenwick addressed the implications of recent federal guidance and leadership communications, noting:

“When leadership is speaking in overtly religious ways, it often then opens the door for lower‑ranking individuals to do the same thing. You also could just have employees who feel emboldened by this and want to further inject religious discourse into the workplace.”

The full article is available here.

Background

On August 9, 2024, Governor J.B. Pritzker signed HB 3773 into law, making Illinois one of a growing number of jurisdictions regulating the use of AI in employment decisions. The law took effect on January 1, 2026.

As previously covered, HB 3773 requires employers to provide notice to applicants and employees when AI is used in covered employment decisions, prohibits the use of zip codes as a proxy for protected classes in AI-driven processes, and reinforces that employers may not use AI in a manner that results in discrimination on the basis of any protected class under Illinois law. The law also grants the Illinois Department of Human Rights (“IDHR”) broad rulemaking authority to define the circumstances requiring notice, the timing for notice, and the means of delivery.

On May 15, 2026, IDHR announced and published proposed amendments to Title 44, Part 2520 of the Illinois Administrative Code to implement those statutory obligations. A 45-day public comment period was opened, with written comments due by June 29, 2026, and a public hearing was scheduled for June 10, 2026.

Proposed Rulemaking Postponed

On June 2, 2026, IDHR announced that it was temporarily postponing the rulemaking process, including the June 10 public hearing. IDHR stated that the postponement was necessary to allow for continued collaboration with other state agencies. IDHR did not provide a revised timeline but indicated that updated information on next steps will be released. In the meantime, the Department encouraged stakeholders to monitor its Legislative Updates webpage for future announcements and rescheduling details.

What the Withdrawn Rules Reveal About IDHR’s Approach

Although the rulemaking has been postponed, the withdrawn rules still offer insight into IDHR’s general approach and the level of specificity employers may expect, recognizing that additional revisions or changes are possible.

Covered Employers and Agents

The withdrawn rules apply to employers as defined under the Illinois Human Rights Act (“IHRA”), along with any third-party acting on an employer’s behalf to “exercise control” over covered employment actions. These entities would qualify as agents and are included in the definition of “employer” under the withdrawn rules. Accordingly, depending on the nature of “control” exercised, staffing firms, technology vendors, external recruiters, and other service providers may share in the same compliance obligations as the employing entity.

Covered AI Tools and Use Cases

The definition of artificial intelligence under Illinois law is exceptionally broad, covering any “machine-based system that, for explicit or implicit objectives, infers, from the input it receives, how to generate outputs such as predictions, content, recommendations, or decisions that can influence physical or virtual environments.” The definition expressly includes generative AI.

The scope of covered employment decisions extends across the full lifecycle of the employment relationship, from recruitment and hiring through discipline, discharge, and the terms and conditions of employment. In addition, the definition of “use” in the withdrawn rule is particularly expansive because it captures any instance in which an AI system “influences or facilitates” a covered employment decision.

While the withdrawn rules identify a non-exhaustive list of covered AI use cases, including computer-based assessments, targeted job advertisements, resume screening, analysis of facial expressions or voice in interviews, analysis of third-party data, productivity monitoring, and work assignment algorithms, the breadth of the underlying definitions extends well beyond these illustrative examples.

Taken together, the definitions significantly broaden the potential scope of the law by capturing AI use cases that play even a peripheral role in an employment decision, including those where the AI output is incidental or supplementary to human decision-making. Unless the rules are revised, Illinois could cover far more use cases than those that are currently covered by other state AI laws.

Notice Obligation for Covered AI Use Cases

Employers using covered AI tools would be expected to provide advance notice to employees, prospective employees, and exclusive bargaining representatives. The obligation applies regardless of whether the AI use raises discrimination concerns or is determinative of the employment decision.

Absent further revisions, employers may need to be prepared to disclose six specific elements: (1) the AI system's developer, product name, and vendor, (2) the covered employment decision it influences, (3) the system's purpose and categories of data collected, (4) the types of job positions the tool will be used for, (5) a point of contact for questions, and (6) the right to request a reasonable accommodation. The withdrawn rules further contemplate that notice be provided simultaneously through multiple channels, including through employee handbooks, physical postings, intranet and external websites, and job postings.

Implications for Employers

The temporary postponement of IDHR’s proposed rulemaking provides employers with additional time but should not be treated as an invitation to pause compliance planning. The underlying statutory obligations of HB 3773 have been in effect since January 1, 2026, and the withdrawn proposed rules offer meaningful insight into the regulatory direction employers should be preparing for, even if further revisions are possible. Employers should use this window to assess their AI footprint and begin expanding their notice and recordkeeping processes, so that when the rulemaking resumes, they are not starting from scratch.

We will continue to monitor IDHR’s rulemaking process and provide relevant updates as developments occur. For additional information, please contact the authors of this alert, a member of Seyfarth's People Analytics team, or any of Seyfarth's attorneys.

Designed to scale with client needs, Seyfarth is launching in Miami with a senior, cross-border team and a full service Florida-based offering led by Juan Carlos Varela, a leading international lawyer and trusted advisor on Latin America–related business and workforce strategy. Varela, whose deep regional experience and cross-border perspective strengthen the firm’s strategic expansion into South Florida, joins Seyfarth as a partner, the office managing partner of the Miami office, and the chair of the firm’s Latin America practice.

His work spans multijurisdictional workforce strategy, regulatory complexity, and risk management for global organizations. Varela has law degrees in four countries and is admitted to practice in Florida, Colombia, Mexico, and Venezuela. He has played a leadership role in establishing and growing legal teams in international markets.

The new Miami office will serve clients from one of the world’s most dynamic business centers, deepening Seyfarth’s presence in South Florida, and enhancing its ability to support clients throughout the United States, Latin America, and the Caribbean. The move reflects the firm’s deliberate, long‑term investment in key regional markets and the global business corridors where clients increasingly need integrated, multinational counsel that connects strategy, execution, and risk across jurisdictions.

“The launch of our Miami office reflects where our clients are going and how Seyfarth is growing to meet them there,” said Lorie Almon, chair and managing partner of Seyfarth. “Miami sits at the center of an increasingly important business corridor linking the United States, Latin America, and the Caribbean. Our expansion into the market is driven by a convergence of client demand for greater transactional and litigation depth in Florida, cross-border business activity, market momentum, and strong leadership. With an experienced Miami team led by Juan Carlos and our firm’s full-service capabilities, we are entering the market with a strong foundation from day one, soon to be followed by additional lateral growth.”

“Miami is a natural hub for clients whose business interests move across borders,” said Varela. “For companies operating throughout the Americas, the market has become increasingly important as they navigate complex regulatory, commercial, and geopolitical issues, including questions of whether, when, and how to move forward across markets. Seyfarth combines deep capabilities across disputes, real estate, construction, transactions, and regulatory matters with a premier global employment platform—and a commercial focus that fits the New York–Miami–Latin America business corridor. That combination makes Seyfarth the right place to serve clients with the breadth and sophistication they increasingly need in Miami and throughout the Americas.”

Miami will support clients with a connected set of capabilities in South Florida and internationally, including commercial risk management, real estate, corporate and M&A, infrastructure and project-related matters, regulatory compliance and investigations, litigation and arbitration, and workforce strategy.

The Miami office also expands Seyfarth’s capabilities to serve clients in industries with significant South Florida and Latin America connections, including financial services and private capital, commercial real estate and construction, infrastructure and development, manufacturing, renewable resources, hospitality and travel, and technology.

The launch also reinforces Seyfarth’s New York–Miami–Latin America business corridor with the addition of Daniel Vielleville, who joins as a litigation partner and will have offices in Miami and New York to serve clients operating across markets and legal systems, where disputes strategy and commercial decisions are closely linked.

Vielleville, admitted in Florida, New York, and Venezuela, brings extensive experience with common law and civil law systems, with a focus on international business transactions and high-profile litigation and dispute resolution. He has represented corporations, sovereign entities, public entities, and governments in US courts and international arbitral forums, experience which supports Seyfarth’s work for clients in Latin America-connected disputes, international arbitration, project-related matters, and cross-border business issues. He has also advised on complex international finance, mining, energy, maritime, and oil and gas transactions.

Victor Guerra joins the Miami office with more than 20 years of experience as in-house senior counsel for multinational Fortune 500 corporations leading complex legal initiatives and navigating cross‑border transactions in Latin America, Europe, and Africa. Guerra’s in-house roles at Philip Morris International, Banco Bilbao Vizcaya Argentaria (BBVA) and CANTV (a Verizon subsidiary) involved compliance, sanctions, investigations, anti-corruption, enforcement, dispute resolution and regulatory strategies across the United States, Latin America, the Caribbean, and Europe, as well as managing both in‑house and external legal resources on a global scale.

Earlier in his career, Guerra was a senior associate in the International Practice at Squire Patton Boggs (formerly Steel Hector & Davis). He joins Seyfarth as a consultant. He holds prestigious certifications in compliance, anti-money laundering (AML), and crime prevention from CAMS (ACAMS), the United Nations University for Peace (UPEACE), and the World Bank Group, and is currently admitted in Venezuela and Colombia.

The Miami office also draws on Seyfarth’s existing Florida‑admitted lawyers, launching with an immediate bench of 20 existing Seyfarth attorneys aligned with the Miami office, providing depth and continuity for the firm’s established Florida‑related matters and Latin America‑connected client work across multiple practices.

“The Miami launch creates an important new connection point for our New York clients and for companies whose business strategies extend across the Americas,” said John Napoli, office managing partner of Seyfarth’s New York office and co-chair of the firm’s Tax practice. “New York and Miami are deeply connected commercial markets. This expansion gives us another powerful way to bring Seyfarth’s capabilities to clients where they are growing.”

“Miami is an increasingly important venue for complex, cross‑border disputes and investigations involving Latin America and the Caribbean,” said Giovanna “Gina” Ferrari, chair of Seyfarth’s Litigation department. “With Juan Carlos at the helm and a team with deep experience in international arbitration, regulatory enforcement, predispute positioning, and high‑stakes commercial litigation, Seyfarth is well positioned to support clients facing sophisticated disputes across jurisdictions.”

“As clients expand and operate across borders, they need legal teams that understand how regulatory, commercial, and workforce considerations intersect in real time when leadership teams are making decisions,” said Darren Perry, chair of Seyfarth’s International Employment Law practice. “Miami strengthens our ability to collaborate across disciplines and geographies, helping clients manage risk and operate effectively across the Americas.”

About Seyfarth

With approximately 1,000 lawyers across 18 offices, Seyfarth Shaw LLP provides advisory, litigation, and transactional legal services to clients worldwide. The firm is recognized for its innovative approach, advancing the standard of legal service delivery in an evolving global marketplace.

Seyfarth works alongside clients to capitalize on opportunities and solve complex challenges across capabilities, including corporate, litigation, real estate, regulatory compliance, labor and employment, and executive compensation and employee benefits. Committed to collaboration and a client-centered approach, Seyfarth delivers solutions as sophisticated as the challenges clients face.

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Episode 47: 2026 Paid Leave Legislative Trends and What They Mean for Employers

In Part Two of this two-part series, Josh Seidman and Dillon Clair shift their focus beyond Virginia to examine the broader national landscape of paid leave and leave of absence legislation in 2026. The discussion highlights activity and developments in states like Hawaii, Illinois, and Pennsylvania, where momentum continues to build through evolving proposals, amendments, and ongoing legislative debate.

The episode also explores emerging trends shaping the future of paid leave, including expanding definitions of covered family members, growing political influence on policy outcomes, and a marked increase in legislative activity nationwide. Josh and Dillon close with insights on federal efforts to harmonize the state patchwork of paid leave, offering practical perspective for employers navigating an increasingly complex compliance environment.

Read the full transcript here. 

Ashford oversees a team of approximately 35 construction attorneys, guiding work that spans contract drafting and negotiation, as well as dispute avoidance and resolution for complex projects nationwide. Her experience includes serving as lead counsel on high-profile public infrastructure efforts, including the redevelopment of LaGuardia and JFK airports.

Read more here.

Framed as a structured debate around the motion “Dispute Boards Are Unfit for Mega Projects,” the session brought together experienced stakeholders from across the project lifecycle to test the limits of dispute boards in today’s most complex infrastructure environments. Our session leader and moderator, Paul Taggart, a long-time construction executive and experienced neutral, had conceived the idea for the session. My fellow debater on the antagonist side, arguing that the standard DB process is not the best fit for purpose on Mega Projects, was Marianne Ramey, an experienced and highly-respected expert on delay and disruption. The protagonist side was ably represented by two highly-experienced and respected DB practioners, Simon Longley and Graham Easton. It was truly an honor (and a pleasure) to serve on such a distinguished panel. In general, the debate touched on all of the points set out below:

The Unique Challenge of Mega Projects

Mega projects—generally defined as those exceeding USD 1 billion—present a set of characteristics that distinguish them from conventional construction projects. These include:

• Multiple interdependent contracts and interfaces
• Significant political, economic, and environmental exposure
• High public visibility and stakeholder scrutiny
• Complex and often imbalanced risk allocation structures

These factors create conditions in which disputes are more likely, more complex, and higher in value. They also introduce risks that originate outside the project’s contractual framework, including governance failures and external political pressures.

The Intended Role of Dispute Boards

Dispute boards were designed to address project disputes through real-time, embedded engagement. When implemented effectively, they provide:

• Early identification and resolution of issues
• Ongoing project oversight, including site visits and regular meetings
• Neutral, expert determination of disputes
• Rapid decisions intended to maintain project momentum

Modern practice emphasizes that dispute boards serve primarily as dispute avoidance mechanisms, with much of their work focused on informal guidance rather than formal rulings.

Evidence shared during the session indicated that projects with actively engaged boards can, in some instances, proceed with few or no formal disputes, underscoring the preventative value of early and consistent involvement.

Structural Challenges at Mega Project Scale

Despite their benefits, the session highlighted several recurring challenges that raise questions about the scalability of dispute boards.

Governance vs. Contractual Resolution

Dispute boards operate at the contractual level, while many of the root causes of mega project underperformance arise at the governance level—including unrealistic assumptions, weak oversight, and fragmented accountability.

Timing and Entrenchment

By the time disputes reach formal consideration, critical project decisions are often already entrenched. This limits the ability of dispute boards to meaningfully influence underlying project outcomes.

Procedural Formalization

Large, high-value disputes tend to drive DB processes toward increased formality, including:

• Greater involvement of legal counsel and technical experts
• Expanded evidentiary submissions
• Hearing formats resembling arbitration

This evolution can erode the efficiency and speed that distinguish dispute boards from traditional dispute resolution processes.

Limits of Informality

The informal nature of dispute boards—often a key advantage—can also present risks in complex disputes, including:

• Perceived inconsistencies in decision-making
• Concerns regarding procedural rigor
• Increased likelihood of challenges and escalation to arbitration or litigation

These pressures can undermine confidence in the process, particularly where the stakes are exceptionally high.

Why Dispute Boards Still Matter

Notwithstanding these challenges, the Rome discussion reinforced that dispute boards remain a critical component of effective dispute management when properly deployed.

Their effectiveness is strongest where:

• Boards are appointed early, ideally at project inception
• Parties actively engage in ongoing, informal dialogue
• Dispute avoidance is prioritized over formal adjudication
• Boards are integrated into the broader project governance framework

Importantly, many criticisms of dispute boards reflect an outdated view of their role as purely reactive adjudicators. In practice, modern DBs are increasingly proactive, embedded participants in project delivery.

The Mega Project Paradox

A notable theme emerging from the debate is the possibility that dispute boards may, in some cases, manage symptoms rather than resolve underlying causes.

By resolving disputes sufficiently to allow projects to continue, dispute boards may inadvertently enable projects with deeper governance or structural issues to persist longer than they otherwise would.

While not universally accepted, this perspective highlights an important limitation: dispute boards cannot substitute for sound project design, governance, and decision-making.

What Should Project Stakeholders Do Now?

The discussion in Rome makes clear that the relevant question is no longer whether to use dispute boards—but how to deploy them effectively on mega projects.

Stakeholders should consider the following:

• Start with governance, not dispute resolution. Establish clear decision-making authority, accountability structures, and risk ownership before implementing dispute mechanisms.
• Appoint dispute boards early—and use them proactively. Early engagement allows boards to identify and address issues before they escalate into formal disputes.
• Design dispute board procedures for scale. Mega projects may require hybrid approaches that preserve flexibility while incorporating appropriate procedural safeguards.
• Align risk allocation with project realities. Overly aggressive or imbalanced risk transfer increases the likelihood of disputes that no mechanism can efficiently resolve.
• Plan for escalation. Recognize that some disputes will move beyond the board process and ensure that escalation pathways are clear, efficient, and enforceable.

Conclusion

The Rome session underscored that dispute boards remain a valuable tool in the delivery of complex infrastructure projects. However, their effectiveness on mega projects depends less on their presence and more on how they are integrated within the broader project ecosystem. The parties should discuss the possibility of new and innovative DB structured such as the possible use of one DB member solely as a mediator.

For project owners, contractors, and counsel, the implication is clear: dispute boards should be deployed as part of a comprehensive strategy that prioritizes governance, realistic planning, and collaborative project execution.

When aligned with these fundamentals, dispute boards can play a meaningful role in navigating the complexity and risk inherent in today’s largest and most challenging projects.

Mazzeo emphasized the potentially broad and unexpected impact of the proposal, noting:

“It’s going to be bigger than people expect. My biggest fear is that people just aren’t going to know this applies to them.” 

The full article is available here.

The firm earned this recognition for its work supporting the Wilson Global Initiative—an organization dedicated to eradicating global illiteracy—including conducting a 50-state survey on book banning laws. This work enabled WGI to help civil society groups challenge book bans and defend access to information in US schools and libraries.

Award winners will be announced on June 30, 2026.

Learn more about the TrustLaw Pro Bono Awards here.

Welcome back to The Week in Weed, your Friday look at what’s happening in the world of legalized marijuana. This week, we see lawsuits filed to block cannabis rescheduling. Minnesota is taking steps to overhaul their cannabis industry. Some members of Congress would like guidance on the tax implications of rescheduling. And finally, Ultimate Frisbee has an official THC brand.

RESCHEDULING LAWSUITS

Two lawsuits were filed recently to block the rescheduling of medical cannabis. One is being brought by several state Attorneys General, alleging that the administration didn’t follow proper procedures in taking this action. One of their complaints is that the administration had no notice and comment period. While it’s true there were no comments in 2026, when the rule was finally promulgated, over 43,000 comments were received in 2024, when the rescheduling process first began. For reasons that are unclear, Louisiana’s Attorney General has asked that her state be removed from the suit. This lawsuit is being consolidated with one brought in early May by prohibitionist groups Smart Approaches to Marijuana and the National Drug and Alcohol Screening Association.

As if that weren’t enough to keep track of, there’s another suit that was filed late last week by five “aggrieved persons” protesting the rescheduling. Each plaintiff has a unique complaint about the rescheduling itself and the process. Perhaps the most interesting is the argument made by MMJ International Holdings:

The final order directly and concretely injures MMJ by creating a regulatory double standard that rewards state-market marijuana operators who operated outside the federal Controlled Substances Act while penalizing federally compliant pharmaceutical developers like MMJ that invested millions in the FDA pathway, DEA registration and pharmaceutical manufacturing controls. The final order’s expedited registration pathway for state licensees effectively bypasses the rigorous public-interest standards, criminal-history requirements and diversion-prevention controls that DEA imposed on pharmaceutical applicants like MMJ, constituting a competitive injury cognizable under Article III.

MINNESOTA

Minnesota is looking to reshape the state’s cannabis industry to benefit both the retail market and the hemp operators who are facing a federal ban. Among other changes, the new law will merge part of the state’s cannabis supply chain and make it easier for those in the hemp industry to transition to adult-use retail. In addition, adult-use customers will be able to buy cannabis at a medical marijuana store without a medical card. Those in the industry seem happy to see these changes, as they are less than optimistic that Congress will “save” the hemp industry.

TAX GUIDANCE

One of the difficulties of running a cannabis business is the inability to deduct business expenses on one’s federal tax forms. Does rescheduling mean that this difficulty has been removed, at least for those businesses in states in which medical, but not adult use, marijuana is legal? In April, the Treasury Department promised that information would be forthcoming. And yet, here we are at the beginning of June, no wiser than we were when that press release was published. Seven members of Congress have sent a letter to the IRS and the Treasury Department urging them to get busy and provide details.

AND FINALLY

In what should come as a surprise to no one, the Ultimate Frisbee Association (UFA) has named an official THC drink. Delta, a leading THC beverage brand, is one of the first THC companies to partner with a professional sports league. And in case you were wondering, the Ultimate Frisbee season runs April – August.

Be well everyone – we’ll see you next week.

Seyfarth Synopsis: In a critical development, the EEOC has officially replaced its Strategic Enforcement Plan (SEP) for Fiscal Years 2024–2028 with a new National Enforcement Plan (NEP) for Fiscal Years 2025–2029, signed by Chair Andrea R. Lucas on June 4, 2026.  The transition represents a fundamental shift of the agency’s enforcement philosophy, priority structure, and relationship to the Trump administration. Here is our detailed breakdown of what changed, what survived, what was scrapped, and importantly, what employers need to know and consider now.

I. The Big Picture: A Philosophical Overhaul

The EEOC’s Strategic Enforcement Plan has, for years, served as the agency’s compass.  Commission resources, administrative investigations, and EEOC lawsuits were all measured against the SEP.  The SEP was rooted in a social justice framework, and committed the agency to supporting “lawful and appropriate diversity, equity, inclusion, and accessibility (DEIA) practices.”

The NEP — supported by EEOC Chair Andrea Lucas and fellow Republican Commissioner Brittany Panuccio[1] — adopts a starkly different posture. It opens by “reaffirm[ing] that [the EEOC] is an executive branch agency” and declares that “the Commission will use its discretion in its deployment of its enforcement authority to advance the Administration’s policy objectives and comply with relevant Executive Orders.”  In place of the racial and economic justice framing, the NEP has a clear law-enforcement-first orientation, with explicit alignment to White House policy directives, including Executive Order 14281, Restoring Equality of Opportunity and Meritocracy.

What this means for employers: While the SEP positioned the EEOC as an independent civil rights champion, the NEP positions it as an executive branch law enforcement agency taking its marching orders from the Administration.

II. Structural Changes: Washington Takes the Wheel and Ends Local EEOC Enforcement Priorities

Under the SEP, the agency operated through a combination of national priorities and District Complement Plans — locally tailored enforcement strategies that allowed individual District offices to identify region-specific vulnerable populations and enforcement targets, while still adapting the agency’s SEP.

The NEP abruptly withdrew all District Complement Plans and other local enforcement plans or priorities.  In their place, the NEP emphasizes that the EEOC must “function as a national law enforcement agency,” with the Chair directing “collaboration, coordination, and communication” across all offices.  The NEP contemplates nationwide staffing deployments, including reassigning matters across Districts and deploying headquarters personnel to field operations depending on the nature of a particular matter.

What this means for employers: Multi-state employers should expect more uniform enforcement. The patchwork of District-level priorities that sometimes allowed employers to predict regional enforcement trends is gone. The agency now plans to operate from a single national playbook. This will likely take time, but we expect to observe increased consistency in the coming months.

III. Disparate Impact: A Doctrinal Sea Change

One of the NEP’s most consequential provisions is its outright abandonment of disparate impact theory. The now-defunct SEP (and years of prior enforcement announcements) specifically incorporated the disparate impact framework to pursue facially neutral policies with unequal outcomes.  Indeed, the SEP priorities around barriers in recruitment and hiring, AI in decision-making, and background checks all implicated disparate impact analysis.

Through the NEP, the Commission states that “allegations of intentional discrimination (disparate treatment) by an employer inherently are more egregious forms of discrimination than unintentional disparities between groups of employees which arise from an employer’s neutral policies or practices (disparate impact).”

Citing Executive Order 14281, the NEP commits the EEOC to:

• Prioritize disparate treatment theories of liability;
• Eliminate the use of disparate impact liability theories in investigations “to the maximum degree possible”; and
• Not commence, develop, or continue to pursue litigation advancing disparate impact claims.

What this means for employers: Disparate impact remains a valid statutory theory codified in the Civil Rights Act of 1991, as the NEP itself acknowledges. But the EEOC will no longer be the vehicle through which these claims are advanced at the federal level. Private plaintiffs, state attorneys general, and state civil rights agencies remain free to pursue disparate impact theories, and employers should be on the lookout for such claims.

IV. DEI Squarely in the Crosshairs

The NEP’s specificity on DEI deserves special mention. The EEOC has identified the following practices as potential enforcement targets:

• Race- or sex-based quotas, including “aspirational goals” that function as proxies for quotas or that incentivize race- and sex-based decision-making in hiring, staffing, layoffs, and promotions;
• Diverse slate policies and diverse hiring panel policies;
• Diversity statements required of candidates;
• Sharing employee race or sex data with managers, the public, or non-HR personnel;
• Rubrics or evaluation methods that consider protected characteristics;
• Executive compensation or bonuses tied to demographic goals or diversity metrics; and
• Limiting access to training, internships, fellowships, mentorship, sponsorship, apprenticeships, employer-sponsored groups or events, bonuses, or other terms and conditions of employment on the basis of protected characteristics.

What this means for employers: This is the most detailed roadmap the EEOC has published for DEI-related enforcement. The specificity strongly suggests the agency already has enforcement targets in mind.  In fact, the NEP specifically references DEI programs and practices “often adopted by large corporations, prominent universities, and other elite institutions.”

V. Substantive Changes: A Priority-by-Priority Comparison

Below, we walk through each of the NEP’s six subject-matter priorities and compare them against the SEP’s framework.

Priority 1: Repeated, Overt, and Intentional Discrimination

The first NEP priority is cases involving repeated or overt discrimination or intentional discrimination.  The EEOC provides numerous examples of this, including:

• Job advertisements excluding or encouraging certain individuals to apply, including targeting applicants based on race (including encouraging “diverse candidates” to apply) or national origin (including encouraging “guest worker visa holders” or “PERM applicants” to apply, and practices or preferences for guest worker visa holders or PERM applicants[2]), or other practices or policies labeled or framed as diversity, equity, and inclusion (including quotas or aspirational goals, limiting access to any term, condition, or privilege of employment based on protected characteristic, or otherwise using race and sex in any decision, including diverse slate policies, diverse hiring panel policies, and any other candidate evaluation practices and compensation practices tied to a protected characteristic or diversity goals);
• Staffing agencies that exclude individuals from employment based on protected characteristics;
• Mass denials of accommodations; and
• Systematic harassment.

Of note, while systemic harassment appears alongside other examples of overt discrimination in the NEP, its prominence is dramatically reduced as compared with the previous SEP.  The now-scrapped SEP devoted an entire standalone priority to systemic harassment, backed by detailed statistical data showing over 34% of charges between FY 2018–2022 included a harassment allegation.  By contrast, the NEP’s only direct mention of systemic discrimination is a single line item in an enumerated list.

Key takeaway: The SEP’s hiring-barrier priority was largely aimed at systemic practices that disproportionately screened out minorities and women. The NEP has flipped this lens: its hiring-related enforcement is focused on protecting American workers from being disadvantaged in favor of visa holders. Chair Lucas has designated “Protecting American workers from anti-American national origin discrimination” as one of four Chair Priorities discussed below.

Priority 2: Legal Doctrine, Recent Supreme Court Precedent, and Statutory Interpretation

The second priority emphasizes cases with the potential to promote the development of law interpreting the anti-discrimination statutes the EEOC enforces.  The NEP highlights in particular “the application or scope of recent Supreme Court precedent or presenting unresolved issues of statutory interpretation,” highlighting some specific cases. These include Title VII claims under Ames v. Ohio Department of Youth Services (holding the same standard applies when majority group members allege discrimination); Muldrow v. St. Louis (holding that “some harm” is enough to show an applicant or employee suffered an adverse action); Students for Fair Admissions (holding that protected characteristics cannot be a consideration in admission decisions, which some argue extends to employment decisions as well); Groff v. DeJoy (holding that employers are obligated to provide reasonable accommodations for sincerely held religious beliefs of employees); and Bostock v. Clayton County (holding that discrimination based on sexual orientation can be sex discrimination, but here extending the holding to single-sex intimate spaces, employers’ and employees’ right to express the binary nature of sex, and employees’ rights to religious accommodations). Also described are the scope of liability under the Pregnant Workers Fairness Act; and cases where there is a federal circuit split on an NEP priority or in which the agency is seeking Supreme Court resolution.

Key takeaway: The SEP’s “emerging issues” priority was forward-looking, oriented toward expanding protections for new categories of workers and new forms of discrimination. The NEP’s emerging-issues equivalent is backward-looking in a sense and is focused on limiting the scope of recent legal developments (like Bostock) and on targeting what it views as overreach by prior EEOC leadership.

Priority 3: Vulnerable Workers

The third priority is a focus on vulnerable workers, “including teenage workers, persons with limited literacy or education, individuals employed in low wage jobs, survivors of sexual assault, and workers with developmental or intellectual disabilities.”

Key takeaway: The NEP’s vulnerable worker category is dramatically narrower than the SEP’s version. Several populations that the SEP previously singled out for “focused attention” no longer make the cut, including LGBTQI+ individuals, immigrants, people with arrest records, and older workers. Employers who relied on the SEP’s expansive vulnerable-worker framework to anticipate enforcement activity should consider recalibration.

Priority 4: The Commission’s Enforcement Process

The fourth priority is a focus on cases “involving the integrity or effectiveness of the Commission’s enforcement process, including cases involving: claims of retaliation; cases where a respondent’s “defense is rooted in a challenge to a Commission policy documents;” cases “protecting Commission access to information,” such as subpoena enforcement actions (which we have already seen increase this year); cases involving breaches of Conciliation Agreements or Consent Decrees; and cases involving violations of recordkeeping and reporting requirements.

Key takeaway: This priority reflects the Commission’s view of itself as a law enforcement agency, and apparent desire to maintain the integrity of the investigative and enforcement process.  Employers should continue to be on the lookout for retaliation claims, which we have already seen increase in popularity over the last several fiscal years. We also expect the EEOC will be paying particular attention to compliance with the terms of settlements with the government; something that in the past was often an afterthought.

Priority 5: Amicus Briefs in Cases Involving Religious Discrimination

Interestingly, this priority specifically applies to cases where the EEOC may serve as an amicus.  The EEOC will look at “matters involving religious organizations and religious employers” where it can “clarify the constitutional and statutory limitations regarding liability under the statutes it enforces.”

Key takeaway: This priority relates to other priorities involving claims of religious discrimination and accommodations for sincerely held religious beliefs of employees, and the Chair’s Priority, discussed below, regarding protecting workers’ religious liberty rights.

Priority 6: “Evenhanded Enforcement”

This priority says that the EEOC “should ensure evenhanded enforcement of the civil rights laws enforced by the agency, mindful that as public servants, EEOC staff are working on behalf of all American workers protected by these laws.”

Key takeaway:  This — alongside the NEP’s citation to Ames v. Ohio Department of Youth Services (which addressed majority-group standing under Title VII) — signals that the EEOC does not view enforcement limited to historically disadvantaged groups, and that the agency will be more willing to bring cases where the charging party is in a majority group (i.e., white employees, men, US-born workers).  Indeed, as detailed elsewhere in the NEP, the EEOC is expected to prioritize claims by majority-group workers and claims related to DEI practices.

VI. What Else is Missing from the NEP?

Notably absent from the NEP is a priority related to access to justice.  The SEP’s access-to-justice priority was a major driver of EEOC challenges to broad arbitration agreements and restrictive settlement terms. Its absence from the NEP could signal a meaningful de-escalation on these fronts.

After years of being an EEOC focus, equal pay has not survived as a named enforcement priority. While the EEOC retains jurisdiction over equal pay claims, the absence of this priority from the NEP likely means fewer proactive systemic investigations in this area.

Under the SEP, AI and machine learning in hiring were top enforcement concerns, but they are not identified as a standalone priority in the NEP, nor is AI even mentioned in the NEP.

VII. The Four “Chair Priorities”

The NEP introduces a new mechanism: “Chair Priorities,” designated by Chair Lucas and subject to change at the Chair’s discretion. The initial four are:

1. Remedying DEI-related race and sex discrimination;
2. Protecting American workers from anti-American national origin discrimination;
3. Defending women’s rights to single-sex spaces at work and workers’ rights to express the binary nature of sex; and
4. Protecting workers’ religious liberty rights.

The SEP had no comparable mechanism for individual-Commissioner-designated priorities. Under the SEP, priorities were set by Commission vote and required a majority to modify.  The Chair Priority mechanism appears to give the Chair a more agile tool for directing enforcement focus without a full Commission vote, and subject to change at any time for any reason.

VIII. What Employers Should Consider Now

Based on our analysis of both documents, here are the critical action items:

1. Revisit DEI. The NEP provides a specific enforcement roadmap. If your organization uses diverse slates, demographic-linked compensation, mandatory diversity statements, race- or sex-conscious evaluation rubrics, or restricts access to programs based on protected characteristics, these are squarely in the agency’s sights.  There is significant disagreement on what is lawful in this space, but being aware of this as an enforcement target is an important consideration.

2. Revisit Religious Accommodation Processes. The NEP and Chair Priorities elevate religious liberty to a top enforcement concern, specifically invoking Groff v. DeJoy. Employers should review their processes in this area to ensure compliance with Title VII.

3. Review Guest Worker and Visa-Related Hiring Practices. The NEP’s focus on “anti-American national origin discrimination” and preferencing of visa holders is new territory for the EEOC.  Employers should pay attention to job postings, staffing contracts, and hiring workflows in light of this EEOC focus.

4. Prepare for Centralized, Coordinated Enforcement. The elimination of District Complement Plans and the creation of a national deployment model means enforcement actions may be more strategic and better-resourced.  Employers should not assume that a District office’s historical enforcement posture will predict its future activity.

5. Monitor Executive Orders. The EEOC has now been clear that it is taking its enforcement cues from the Administration.  Tracking Executive Orders is now, functionally, an EEOC compliance exercise.

6. Don’t Neglect the Priorities That Survived. Protections for vulnerable workers (particularly teenage workers, low-wage workers, and workers with developmental disabilities) remain in the NEP.  The EEOC will continue to process the hundreds of thousands of charges it receives annually across all bases. The NEP shifts priorities but it does not eliminate the agency’s statutory obligations.

Implications for Employers

The transition from the SEP to the NEP is a wholesale reorientation of the government’s primary workplace anti-discrimination enforcement agency. The SEP’s six broad priorities — built around systemic barriers, vulnerable communities, emerging social issues, and access to justice — have been replaced by a leaner, more politically charged set of priorities centered on DEI enforcement, religious liberty, the binary nature of sex, and the protection of American workers over visa holders. Employers should pay close attention to the new priorities we have described above, and batten down the hatches for what could be swift enforcement of these areas.

We will continue to monitor implementation and will update this space as enforcement actions and litigation emerge under the new framework.

[1] Democratic commissioner Kalpana Kotagal voted against the NEP.

[2] In practice, this translates to charges brought by US-born workers involving claims of national origin discrimination where a charging party challenges hiring practices based on a preference for foreign workers or PERM recruitment practices or policies.

The article highlights three recent rulings from the US Court of Appeals for the Federal Circuit and the US Court of Federal Claims, illustrating how contractors can forfeit otherwise viable claims by overlooking patent ambiguities, failing to present claims to the contracting officer, or attempting to relitigate issues already decided. Across the cases, the authors emphasize the importance of early issue preservation, careful claim drafting, and strategic procedural timing.

As Jacobson and Barney explain:

“Together, these decisions reinforce a recurring lesson: Contractors must preserve arguments early, present claims clearly and raise all relevant arguments the first time they litigate.”

The full article is available here.

New York Law Journal, part of American Lawyer Media, published a timely article by Henry Morriello and Michael Karol, “Secured Finance Under Article 12 and the 2022 UCC Amendments.”  The piece, published on June 5, 2026, examines the impact of newly enacted Article 12 of the Uniform Commercial Code, which took effect in New York on June 3.

The article explores how the 2022 UCC amendments modernize commercial finance law for digital assets by introducing the concept of “controllable electronic records,” allowing secured parties to perfect security interests through control rather than filing and reshaping priority and risk considerations for cryptocurrencies, tokenized assets, and other electronic intangibles.

As the authors note:

“The long-awaited 2022 amendments to the Uniform Commercial Code (UCC), which become effective in New York on June 3, represent the most important modernization of commercial finance law in decades.”

The full article is available here.

Lexology quoted senior counsel Dawn Lurie in its article, “US Employers Face E-Verify Compliance Maze as Federal Mandate Looms.” The piece, published on June 5, 2026, explores how a proposed federal E-Verify mandate could create a national baseline while leaving employers to navigate a complex patchwork of state requirements.

Lurie highlighted the shifting landscape, noting:

“Increased focus on immigration enforcement, coupled with broader adoption of E-Verify at the state level, may give proposals like this more momentum than similar bills received in prior Congresses. As a result, while proposals continue to be introduced, the likelihood of passage remains uncertain.”

The full article is available here.

Today, Charlotte leads the Law, Data, and Design Lab at Georgia Tech and is Professor of Law and Ethics at the Georgia Tech Scheller College of Business. Charlotte and her team at Georgia Tech use AI and machine learning to process massive amounts of court data and surface of patterns and disparities that have long been buried in millions of pages of legal text. Charlotte's work has attracted funding from the National Science Foundation, the US Department of Labor, and Google. She serves on the AI Committee for the Georgia Judiciary and was a Fulbright Scholar.

Simply put, Charlotte has been doing this work long before AI and machine learning became mainstream, bringing a perspective that is both deeply technical and human-centered. In today’s conversation, we’ll explore the challenges hidden in court data, what AI can and can’t do for the justice system, and ethical questions that come with deploying these technologies at scale.

Read the full transcript of today's episode here.

Related Links

Charlotte Alexander on LinkedIn

Georgia Tech's Law, Data, and Design Lab

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Seyfarth’s Government Contracts practice has advanced to Band 2 in the 2026 edition of Chambers USA’s “Government Contracts: The Elite” category, underscoring the group’s sustained excellence and reputation as one of the leading practices in the nation. This designation places Seyfarth among a select group of firms acknowledged for their depth of experience, strong market presence, and ability to advise on complex and high-stakes government contracting matters.

The nationwide practice-level recognition is complemented by individual rankings that reflect the strength and breadth of the team:

• Adam Lasky – Government Contracts
• Amy Hoang – Government Contracts; Government Contracts: Bid Protests
• Edward Arnold – Government Contracts
• Erica Bakies – Government Contracts

Feedback also emphasized the group’s collaborative approach and integration with client teams, with one client describing Seyfarth as “a seamless extension of the legal team.” Others pointed to the practice’s depth, responsiveness, and ability to consistently deliver high-quality work aligned with business objectives. The team’s “global reach,” combined with its ability to scale and handle a wide range of matters, was also recognized as a key differentiator.

This recognition reflects the group’s ongoing commitment to providing strategic, commercially focused counsel across the full spectrum of government contracting issues. As the firm continues to build on this momentum, the Government Contracts practice remains focused on helping clients navigate an increasingly complex and evolving regulatory environment.

Notably, Seyfarth’s national Government Contracts practice moved up a band and earned distinction in the coveted “The Elite” category. The firm’s Labor & Employment practices in Illinois, California, and New York also earned "The Elite” status. This designation highlights standout groups recognized for excellence in highly specialized areas and niche practices.

Seyfarth’s national Labor & Employment practice secured a Band 1 ranking for the sixth consecutive year, while its national Retail practice achieved Band 1 ranking for the ninth year in a row.

Additional nationally ranked practice groups include Construction, Employee Benefits & Executive Compensation, ERISA Litigation, Immigration, Real Estate, Transportation: Road, and Investment Funds: Investor Representation.

At the state level, Seyfarth earned recognition across several key practices, including:

• Construction: California, Washington, Washington DC
• Employee Benefits: Illinois, New York
• Healthcare: Texas
• Immigration: Georgia, Washington DC
• Labor & Employment: California, Georgia, Illinois, Massachusetts, New York, Texas, Washington, Washington DC
• Litigation (White Collar Crime & Government Investigations): New York
• Real Estate: Georgia, Illinois, Massachusetts, New York, Southern California, Washington, Washington DC

Seyfarth’s individual attorneys also attained prominent recognition, achieving high rankings across a variety of practices and regions.

• Nine attorneys maintained Band 1 rankings: Ariel Cudkowicz, Brett Bartlett, Marshall Babson, Elizabeth Deckman, Edmund Emerson III, Amy Hoang, Camille Olson, Leon Rodriguez, and Joel Rubin. They are joined by Marc Mukasey, who joined the firm earlier this year.
• Four attorneys were honored as Senior Statespeople: Bennett Greenberg, Stuart Newman, Richard Preston, and Arthur Telegen
• Two attorneys were again recognized in the Up and Coming category: Meghan Douris and Ashley Sherwood

In total, 34 Seyfarth practices and 86 attorneys earned recognition in this year’s guide.

Chambers USA rankings are based on thousands of in-depth interviews conducted annually with in-house counsel and industry leaders, making them one of the most respected benchmarks for legal excellence.

About Seyfarth Shaw LLP

With approximately 1,000 lawyers across 17 offices, Seyfarth Shaw LLP provides advisory, litigation, and transactional legal services to clients worldwide. The firm is recognized for its innovative approach, advancing the standard of legal service delivery in an evolving global marketplace.

Seyfarth works alongside clients to capitalize on opportunities and solve complex challenges across capabilities, including corporate, litigation, real estate, regulatory compliance, labor and employment, and executive compensation and employee benefits. Committed to collaboration and a client-centered approach, Seyfarth delivers solutions as sophisticated as the challenges clients face.

Seyfarth earned a Top 5 overall ranking among “Large Firms” in Bloomberg Law’s 2026 Leading Law Firms report—an important recognition that reinforces the firm’s leadership in a rapidly evolving market. Seyfarth ranked No. 2 in its cohort for Technology & Innovation in the report.

Seyfarth’s performance reflects its strength in each of the four key pillars Bloomberg uses to evaluate firms: Financial Strength, Talent, Growth, and Technology & Innovation.

Building on a financially strong 2025—marked by significant transactions and increased profits per partner—the firm has maintained its momentum into 2026. In the first half of the year alone, Seyfarth welcomed 12 lateral partners, further enhancing its deep, nationally recognized bench of talent.

This year’s report places greater emphasis on innovation and the role of AI, with firms assessed on how effectively they are adopting and applying these capabilities in service of clients—an area where Seyfarth continues to stand out. 

Seyfarth’s recognition highlights its ongoing investment in innovation, its commitment to delivering value through technology, and its readiness to meet evolving client needs.

Read the full report here.

California employers, along with employers in Oregon, Illinois, and Massachusetts, face a unique situation as numerous state laws either govern the actions employers may take to comply with federal law or create additional employer obligations.  The compliance challenge is not choosing between state and federal law, but understanding how to operate within both and threading an increasingly large thread through a shrinking needle.

This refresher highlights recurring compliance issues and explains how well intentioned actions can create exposure, including potential civil penalties.

The Compliance Tension Employers Must Manage

California, through statutes such as the Immigrant Worker Protection Act (AB 450) and the Workplace Know Your Rights Act (SB 294), places specific limits on employer conduct and imposes affirmative obligations. Compliance obligations for California companies can be triggered at three times: during the initial hire and onboarding; during the tenure of employment; upon notice of a federal investigation or inspection and the related inspection results.

For California employers, compliance obligations typically arise at three points: 1. Onboarding; 2. during employment; and 3. when a federal immigration inspection is initiated and later when inspection results are issued. Each stage presents separate risks, particularly where federal requirements and California restrictions intersect.

Onboarding

Under federal law, employers must verify the identity and work authorization of every employee hired on or after November 6, 1986 using Form I-9. California law imposes additional restrictions in this process. Labor Code section 1019.1 prohibits employers from rejecting documents that reasonably appear genuine and relate to the individual, where those documents satisfy federal requirements. This prohibition carries civil penalties that can reach up to ten thousand dollars per violation and may be enforced by the California Labor Commissioner independent of federal enforcement.

California also regulates the use of E-Verify. While participation in E-Verify is generally voluntary, state law limits when and how employers may use the system and creates potential liability for misuse. Employers must follow federal program rules when handling tentative nonconfirmations and ensure that employees are properly notified.  Most importantly under California Labor Code Section 2814, California employers can be fined for misuse of the system including using E-Verify for prescreening new hires.  

In addition, California’s Workplace Know Your Rights Act requires employers to provide employees with a stand-alone written notice of rights at the time of hire and annually thereafter. This notice must address workplace rights and protections, including rights that may arise if immigration enforcement occurs at the workplace. Employees must also be given the opportunity to designate an emergency contact. If an employee consents to notification and the employer has actual knowledge that the employee has been arrested or detained in connection with workplace enforcement, the employer must notify the designated individual.

During Employment

During the course of employment, employees may update their personal information, including a change in name, Social Security number, or work authorization documentation. These situations must be handled carefully.

Under California law, an employer may not take adverse action, including termination, against an employee who presents new identity or work authorization documents where those documents reasonably appear to be genuine and relate to the individual. Even where the new documentation differs from what was originally provided, the employer must evaluate it under the same standards used at the time of hire. In these situations, government guidance on identity changes should be followed and counsel from an experienced practitioners should be considered.  While California Labor Code Section 2814, prohibits employers from E-Verifying existing employees, actual  “change of identity situations” are nuanced and should be discussed with counsel. 

Employees also have the right to request information regarding an employer’s compliance with applicable Labor Code provisions. Employers must continue to provide the required notice of rights annually in accordance with SB 294.

Federal Inspection and Results

When Immigration and Customs Enforcement initiates a Form I-9 inspection, California law imposes strict and time sensitive obligations that operate alongside federal requirements.

Upon receipt of a Notice of Inspection, employers must provide notice to all employees and any applicable union within seventy two hours. The notice must be communicated in the language the employer normally uses for employment communications.

When the employer receives inspection results identifying deficiencies or issues related to specific employees, the employer must provide affected employees and their authorized representatives with a copy of the relevant notice within seventy two hours. Examples of deficiency notices could include a Notice of Technical or Procedural Violations, a Notice of Suspect Documents or a Notice of Intent to Fine. The employer must also include specific information, including a description of the deficiencies, the time provided to correct them, the date and location for any meeting with the employer, and notice of the employee’s right to representation.

These requirements arise under the Immigrant Worker Protection Act, which also prohibits employers from voluntarily allowing immigration enforcement agents to enter nonpublic areas of the workplace or access employee records without a judicial warrant or subpoena.

Failure to comply with these provisions can result in significant civil penalties ranging from $2000 to $5000 for a first violation and up to $10,000 for subsequent violations, assessed per violation.

At the same time, federal law continues to prohibit obstruction of lawful investigations, including making false statements, concealing information, or interfering with agency processes. Employers that act informally or inconsistently when responding to enforcement activity risk creating exposure under both state and federal law.

Where CA Employers Continue to Make Mistakes

Employers rarely face exposure because they misunderstand the law at a high level. Risk more often arises from failing to understand how state and federal obligations operate together and then reacting in real time without a clear framework. Common failure points include:

• Granting access without proper legal process. Managers may allow agents to enter nonpublic areas or review records without confirming the existence of a judicial warrant or subpoena. Cooperative intent does not excuse violations of California law.
• Missing the seventy two hour notice deadline after a Notice of Inspection. Employers often assume that an extension from ICE to produce Forms I-9 also extends California’s notice obligations. It does not. The obligation to notify employees is triggered upon receipt of the Notice of Inspection and runs independently of any federal deadline.
• Improper handling of inspection results. Employers may delay or summarize deficiency findings while determining next steps. California law requires specific written notice to affected employees within seventy two hours, including details of the deficiency and the employee’s right to representation.
• Unnecessary reverification or document requests. In an effort to mitigate risk, employers may request new documentation or reverify employees outside of federally required circumstances. These actions can create exposure under both federal anti-discrimination rules and California law.
• Uncoordinated or inconsistent communications. Statements made by supervisors or HR personnel without coordination can later be characterized as inaccurate or misleading, particularly where multiple individuals respond to enforcement activity differently.
• Lack of operational readiness. Initial interactions with enforcement often occur at the front line. Without training and clear escalation protocols, employees may take actions that bind the organization before legal review occurs.

Balanced Compliance Is the Goal

The safest approach is neither resistance nor reflexive cooperation, but rather informed careful consideration that accounts for both state and federal requirements. Employers should consider the following steps:

• Establish a centralized point of contact responsible for immigration-related compliance and response.
• Work with experienced counsel who understand the interaction between federal immigration law, California law, and employment law.
• Train managers and staff on how to recognize and appropriately respond to onsite enforcement activity, including the types of documents that may be presented.
• Develop and maintain a written response protocol that addresses how to handle worksite visits, I‑9 inspections, document requests, and internal communications.
• Implement ongoing training, auditing, and process review mechanisms to ensure that policies, and underlying Form I‑9 and E‑Verify practices, including complying with electronic I‑9 systems regulations (often overlooked), remain effective and aligned with current legal requirements.

Employers should not wait until enforcement activity begins to determine their approach. Clear protocols, trained personnel, and a working understanding of both California and federal requirements, including disciplined I‑9 and E‑Verify practices, are essential to managing these situations without compounding risk.

For more information, contact your Seyfarth relationship partner or the authors directly. Seyfarth’s Immigration Compliance & Investigations specialty group is recognized as a national leader in the field. Trusted by Fortune 100 companies and small businesses nationwide, the team provides strategic, practical guidance across the full spectrum of immigration compliance. The group advises on Form I-9 and E-Verify compliance; ICE inspections and worksite enforcement actions; internal immigration assessments and I-9 audits; DOL immigration-related wage-and-hour investigations; H-1B compliance; and DOJ’s IER and OCAHO anti-discrimination matters, including foreign sponsorship and export control/ITAR issues. The team complements its expertise in the Immigration Compliance & Investigations sector with its first-in-class litigation capabilities. Seyfarth is here to help employers navigate a path to California compliant practices and assist with defending against state and local agency enforcement efforts should they occur. Check out the CalPeculiarities Blog for other legal developments affecting California employers.

Lion highlighted the broader public accountability questions driving these disputes, noting:

“Nonprofits tend to think of potential tax collection as the arm of the government that’s coming for them, but that’s the government that represents all the people who are paying taxes that you’re not. We the people want to know if we’re getting our money’s worth.”

The full article is available here.

Delta T Equipment, founded more than 20 years ago by CEO Paul McCarver, has grown under his leadership and that of his management team into one of the most respected commercial HVAC and plumbing distributors in the Houston market, built on technical expertise, deep customer relationships, and a service-driven approach.

The transaction marks an important milestone for the company, positioning it to accelerate growth while preserving the customer-focused culture and leadership that have defined its success. Delta T Equipment will continue to operate under its existing leadership team, supported by ICT's broader resources and national network.

"It was a privilege to work with Paul McCarver and his management team on this transaction," said Paul Pryzant, lead partner on the transaction. "Over the past two decades, Paul McCarver and his team have built a truly outstanding company. This transaction recognizes that foundation while providing the right platform to support Delta T's continued growth and long-term success."

The Seyfarth deal team was led by Paul Pryzant and included James Dorough-Lewis and Tess Rabin, with the assistance of Cassandra Haynes, Sam Rowley (antitrust), Joshua Lake (tax), Jim Gehring (executive compensation), and Matthew Moersfelder (intellectual property).

Seyfarth's Corporate department offers clients a full-service, multidisciplinary team of attorneys across virtually all areas of practice. The corporate group works with an array of businesses, from large, well-known companies to start-ups, and is highly regarded for its deep knowledge of mergers and acquisitions, securities, investment management, corporate counseling, financing, and commercial transactions.

About Seyfarth

With approximately 1,000 lawyers across 17 offices, Seyfarth Shaw LLP provides advisory, litigation, and transactional legal services to clients worldwide. The firm is recognized for its innovative approach, advancing the standard of legal service delivery in an evolving global marketplace.

Seyfarth works alongside clients to capitalize on opportunities and solve complex challenges across capabilities, including corporate, litigation, real estate, regulatory compliance, labor and employment, and executive compensation and employee benefits. Committed to collaboration and a client-centered approach, Seyfarth delivers solutions as sophisticated as the challenges clients face.

In this episode, James O’Brien and Eric Greenberg are joined by Jon Bull to unpack the fundamentals of environmental due diligence, with a focus on Phase I Environmental Site Assessments, including what they cover, why they matter, and how to use them effectively in real estate transactions.

Read the full transcript here.

The Property Line™ is a brief and lively discussion of the biggest issues facing the commercial real estate industry. The podcast will deliver insights from Seyfarth's real estate lawyers and other industry leaders on current market trends and how they impact all facets of commercial real estate. 

If you have a question about this topic, ideas for future episodes, or are interested in being a guest speaker, please reach out to us.

Follow us on:  Apple Podcasts  |  SoundCloud  |  Spotify

Almon emphasized the enduring importance of developing junior lawyers as part of long-term succession planning, noting:

“These partners don’t just come out of the ether. We will always keep hiring junior attorneys.”

The full article is available here.

On May 29, 2026, DHS extended Temporary Protected Status (TPS) for Lebanon through November 27, 2026, continuing employment authorization for eligible beneficiaries.

The decision has been formally published in the May 29, 2026 edition of the Federal Register available at here. United States Citizenship and Immigration Services (USCIS) has updated the “Alert” section on the TPS country webpage as well.

Impact on Employees

Per the Federal Register Notice (FRN), employees with Employment Authorization Documents (EADs) bearing category code A12 or C19 that facially expire on May 27, 2026, will now be automatically extended and be able to continue working through November 27, 2026.

Impact on Employers

USCIS included specific guidance in the FRN and relevant website updates.

For current employees, USCIS advises employers to examine the EAD to see if it has an expiration date of May 27, 2026 and further advises that employers may not solely rely on the country of birth listed on the face of the card to determine whether an employee is eligible for the automatic extension. Instead, employers may rely on the EAD category code (A12 or C19), the May 27, 2026 expiration date, and the employee’s attestation.

Once the employer has determined the employee eligible for the extension, USCIS advises to update Section 2 with the EAD EXT and November 27, 2026 in the Additional Information field, and to initial and date the correction. Employers using electronic I-9 systems should confirm their vendor supports workflows that align (to some extent) with USCIS guidance while also enabling tracking of the new reverification date.

For new employees, USCIS specifies that employees should complete Section 1 by checking the ‘Alien Authorized to Work’ box with November 27, 2026 as the ‘Work Until’ date. Employers should complete Section 2 by entering the appropriate information for the extended EAD with November 27, 2026 as the expiration date.

Per the E-Verify website, when creating a case for a new employee, employers may enter the EAD document number from the Form I-9 along with the automatically extended date of November 27, 2026. Employers, using paper I-9s, should also ensure internal tickler systems are updated to avoid missed reverification obligations in November 2026.

In an environment of frequent TPS changes, consistency, not complexity, is the key to compliance. Employers that build repeatable processes (even when using electronic systems)  for handling automatic extensions and litigation placeholders across all TPS populations will reduce risk and administrative burden alike.

Seyfarth’s Immigration Compliance & Investigations specialty group is recognized as a national leader in the field. Trusted by Fortune 100 companies and small businesses nationwide, the team provides strategic, practical guidance across the full spectrum of immigration compliance. The group advises on Form I-9 and E-Verify compliance; ICE inspections and worksite enforcement actions; internal immigration assessments and I-9 audits; DOL immigration-related wage and hour investigations; H-1B compliance; and DOJ’s IER and OCAHO anti-discrimination matters, including foreign sponsorship and export control/ITAR issues.

*Selene Malench is a Case Assistant on Seyfarth’s Immigration Compliance & Enforcement team. Many thanks for her contribution to this legal update.

Background:

The FWA prohibits employers from taking retaliatory action against employees who engage in certain protected activities, including: (1) disclosing the employer’s alleged illegal activity to a governmental agency; (2) assisting in a government investigation into an alleged violation; or (3) objecting to, or refusing to participate in, an employer activity, policy, or practice that violates a law, rule, or regulation.

The Gessner decision focuses on the third category, which has been the subject of conflicting interpretations among Florida’s district courts of appeal. The First, Second, and Fifth District Courts required proof that the employee objected to an actual violation of law, while the Fourth District permitted claims based on an employee’s good-faith, objectively reasonable belief that the conduct was unlawful. This divergence carries substantial implications, as the “actual violation” standard limits protection to cases involving demonstrable illegality, while the good-faith, objectively reasonable standard is more lenient, allowing claims to proceed where employees raise credible concerns before any violation is definitively established.

Clint Shannon Gessner, a welder mechanic for Gulf Power Company, alleged he was terminated in retaliation for raising workplace safety concerns he believed violated state and federal law. His employer maintained he was terminated for performance-related issues and misconduct. The trial court granted summary judgment for the employer based on its interpretation of section 448.102(3), concluding that Gessner presented insufficient evidence from which a jury could find that he objected to a practice constituting an actual violation of law, rather than merely a suspected violation.

The First District Court of Appeal affirmed, expressly holding a plaintiff must prove he objected to conduct that is, in fact, unlawful. In reaching that conclusion, the First District relied on the Second District’s decision in Kearns v. Farmer Acquisition Co., which emphasized the statutory text—particularly the absence of any “good-faith, objectively reasonable belief” language. The Florida Supreme Court took the case to resolve a key legal question: Must a whistleblower prove an actual violation of law, or is a reasonable belief sufficient?

The Court’s Decision:

The Florida Supreme Court adopted a text‑based interpretation of § 448.102(3), holding a plaintiff must prove by a preponderance of the evidence the employer’s activity, policy, or practice “is in violation of law.” In doing so, the Court expressly rejected the “reasonable belief” standard, explaining the Legislature did not include such language in the statute and declining to read it into the law.

The Court clarified, although a plaintiff need not show a completed or adjudicated violation, the challenged conduct must still constitute a violation of law as a matter of law. Applying this framework, the Court affirmed summary judgment for the employer because Gessner failed to present evidence that the practices he challenged were unlawful.

Key Takeaway and Practical Implications:

The Gessner decision provides much-needed clarity regarding the scope of whistleblower protections under section 448.102(3) and resolves years of uncertainty by making clear that claims under section 448.102(3) must be grounded in conduct that actually violates a law, rule, or regulation—not merely an employee’s reasonable belief that it does. Indeed, employees cannot rely on a subjective or objectively reasonable belief that misconduct occurred. Instead, they must identify and prove an actual legal violation.

For employers, this clarification provides a stronger basis to evaluate and challenge whistleblower claims at the motion to dismiss and summary judgment stages, particularly where a plaintiff cannot identify a specific legal violation. Going forward, claims will turn on whether the plaintiff can identify and support a specific statutory or regulatory violation, rather than general safety concerns or perceived wrongdoing. Nonetheless, employees may still be protected when objecting to conduct that is unlawful—even if the violation has not yet occurred or been adjudicated.

Heliane Fabian, counsel in Seyfarth’s Labor & Employment department, has been selected as one of 24 fellows for the 2026–27 NAPABA Leadership Advancement Program.

The year-long program focuses on helping participants grow as leaders and build connections across the legal field, including relationships between in-house counsel and law firm attorneys.

NAPABA works to increase the representation and influence of Asian American and Pacific Islander attorneys across all areas of the legal profession.

Valsamopoulos brings to Seyfarth wide-ranging proficiency as a go-to transactional attorney advising private equity sponsors and public and private companies on mergers and acquisitions, investments, and general corporate matters. Clients call on Valsamopoulos for counsel on all aspects of their transactions, from inception through ultimate exit. He advises clients on sophisticated transactions spanning a wide range of sectors, including real estate, technology, health care, manufacturing, airlines, travel and leisure, chemicals, and financial services.

Valsamopoulos is the 10th lateral partner to move to Seyfarth’s Corporate department since the start of 2025. They are based in seven different Seyfarth offices, stretching across the country.

“Dan brings exceptional experience to Seyfarth with his highly accomplished track record of advising clients on complex deals in a diverse range of industries,” said Andrew Lucano, chair of Seyfarth’s Corporate department and M&A practice group. “He is the latest key addition to our Corporate team as we continue to expand our department strategically to meet our clients’ needs and goals in core markets.”

Valsamopoulos offers vast experience with a broad range of complex real estate transactions, including multi-tiered joint ventures, co-general partner and co-development partner arrangements, programmatic joint venture structures, and preferred equity investments.

“Dan’s reputation as a ‘go-to’ lawyer for real estate joint ventures for a wide range of businesses further enhances our firm’s world-class real estate offerings,” said Marc Gurell, co-managing partner of Seyfarth’s New York office. “Some of our lawyers have already worked alongside Dan and were very impressed by his ability to navigate clients to successful outcomes. We know he will be a seamless fit at Seyfarth as we continue to expand our transactional practices.”

Valsamopoulos enables sponsors, investors, and other joint venture partners to acquire, develop, and operate various classes of real estate assets in the United States and abroad. Those assets include office buildings, industrial, self-storage, health care, medical office, multi-family, mobile home, student housing, senior housing, retail, and mixed-use properties.

“Dan’s widespread experience provides a substantial bridge between Seyfarth’s Corporate and Real Estate practices,” said John Napoli, co-managing partner of Seyfarth’s New York office. “Dan is a solid and experienced M&A lawyer who can lead and support critical transactions across the platform. He also can independently and successfully handle real estate joint ventures of all types, including development transactions. We look forward to Dan playing an important, strategic role in further servicing our needs in both the real estate joint venture space as well as traditional M&A.”

Valsamopoulos comes to Seyfarth from Westerman Ball Ederer Miller Zucker & Sharfstein, LLP where he was a partner. He previously spent five years at Polsinelli as a shareholder in the corporate department focused on mergers and acquisitions and real estate joint ventures. He began his legal career in the New York office of an international law firm, where he represented private equity firms in connection with their investments, with a primary focus on distressed and special situations.

"I am thrilled to be joining Seyfarth and look forward to leveraging its national platform and the broad scope of work it offers," said Valsamopoulos. "I have had the opportunity to collaborate with the firm's lawyers on a number of matters and have always come away impressed. I welcomed this opportunity wholeheartedly and am eager to get to work with my new colleagues."

Valsamopoulos earned his JD from Brooklyn Law School and his BA from Syracuse University.

Seyfarth’s Corporate department offers clients a full-service, multidisciplinary team of attorneys across virtually all areas of practice. The Corporate group works with an array of businesses from large well-known companies to start-ups and is highly regarded for its deep knowledge of mergers and acquisitions, securities, investment management, corporate counseling, financing, and commercial transactions.

Seyfarth’s Real Estate department serves sophisticated clients across a number of industries. Recognized as one of the largest real estate practices in the US, Seyfarth’s integrated world class team serves local, regional, and national clients on the acquisition, financing, development, leasing, restructuring, servicing, and disposition of noteworthy real estate assets and portfolios. This experience extends across comprehensive array of asset classes, including office, industrial, multifamily, retail, health care, and data center projects.

Seyfarth’s New York office is home to approximately 150 attorneys who provide tailored, business focused counsel across a broad scope of litigation and transactional matters, including financial services, labor and employment, real estate, tax, and more. Seyfarth lawyers draw on deep experience advising some of the world’s most sophisticated businesses, paired with strong knowledge of local law and market dynamics and innovative approaches, to serve as strategic partners to regional, national, and global clients, among them many Fortune 500 companies and leading financial institutions across a wide range of key industries.

About Seyfarth Shaw LLP

With approximately 1,000 lawyers across 17 offices, Seyfarth Shaw LLP provides advisory, litigation, and transactional legal services to clients worldwide. The firm is recognized for its innovative approach, advancing the standard of legal service delivery in an evolving global marketplace.

Seyfarth works alongside clients to capitalize on opportunities and solve complex challenges across capabilities, including corporate, litigation, real estate, regulatory compliance, labor and employment, and executive compensation and employee benefits. Committed to collaboration and a client-centered approach, Seyfarth delivers solutions as sophisticated as the challenges clients face.

At the same time, the DOJ directed the Drug Enforcement Administration (DEA) to conduct a formal administrative hearing, beginning June 29, 2026, to consider whether marijuana more broadly should be rescheduled.

Although this development reflects a meaningful shift in federal policy, it does not legalize marijuana at the federal level. Instead, it introduces a more complex regulatory environment with important—and evolving—implications for employers.

Scope of the Rescheduling Order

The April 2026 order is limited in scope. It applies only to:

• Marijuana-based drug products approved by the Food and Drug Administration (FDA)
• Marijuana handled within state-regulated medical marijuana programs

All other marijuana—including recreational cannabis, most bulk marijuana, and products outside these regulatory channels—remains classified as a Schedule I controlled substance and therefore illegal under federal law.

This creates a dual framework under federal law, where marijuana may be treated differently depending on whether it qualifies as a regulated medical product. Employers should continue to distinguish between medical and non-medical marijuana use when addressing workplace issues.

The order also establishes a federal registration pathway for certain state-licensed medical marijuana operators, reflecting increased federal reliance on state regulatory systems.

A Shift in Federal Recognition—But Not Full Alignment

By moving qualifying marijuana products to Schedule III, the federal government has formally recognized that marijuana has accepted medical uses and a lower potential for abuse than Schedule I substances.

However, this change does not place medical marijuana on the same footing as traditional prescription medications in all respects. The CSA, the Americans with Disabilities Act, and other federal laws have not been amended, and the use of recreational marijuana remains federally prohibited. Employers should view this development as a policy shift that introduces new considerations, rather than a complete overhaul of existing legal obligations.

Key Implications for Employers

1. Increased Focus on ADA Accommodation Requests

Employers should anticipate an increase in accommodation requests tied to applicants’ and employees’ medical marijuana use.

Historically, courts rejected such claims based on the ADA’s definition of “individual with a disability,” which excludes an individual who currently engages in the illegal use of drugs, and marijuana’s status as a Schedule I controlled substance with no accepted medical use under federal law. Following rescheduling, that rationale may be subject to greater challenge—particularly where individuals are using marijuana under the supervision of a licensed health care professional and/or in compliance with state medical programs.

That said, employers are not required to automatically permit medical marijuana use. Instead, they should continue to: (1) engage in the interactive process where appropriate; (2) assess whether a requested accommodation is reasonable; and (3) evaluate whether the applicant’s or employee’s use poses a “direct threat,” particularly in safety-sensitive roles.

Employees may increasingly argue that state-authorized medical marijuana should be treated similarly to other Schedule III medications, although federal law does not yet treat these products identically. Employers should also continue to account for applicable state medical marijuana and disability discrimination laws, many of which independently provide protections for medical marijuana cardholders.

2. State “Lawful Product” Laws: Potential Reconsideration of Prior Claims

The rescheduling may also introduce new uncertainty under state “lawful product” or off-duty conduct laws.

In several jurisdictions, courts have previously rejected claims by employees or applicants who were disciplined or denied employment based on marijuana use—even where that use was permitted under state law. In those cases, courts often relied on statutory language protecting only conduct involving products that are “lawful” under federal or state law. Because marijuana was classified as a Schedule I substance, courts concluded it remained unlawful under federal law and therefore fell outside the scope of those protections.

The reclassification shift to Schedule III may prompt renewed challenges to those interpretations. Individuals may argue that marijuana—particularly when used in compliance with state medical marijuana programs—no longer categorically fails the “lawfulness” requirement that previously barred such claims. It remains unclear how courts will evaluate these arguments.

Employers operating in states with lawful product or off-duty conduct protections should monitor developments closely and consider how these laws may apply as the federal landscape continues to evolve.

3. Drug Testing and Workplace Policies Remain Permissible—But May Face Scrutiny

The DOJ’s order does not directly regulate workplace policies. Employers generally retain the ability to: (1) prohibit marijuana use, possession, and impairment during work; (2) maintain drug-free workplace policies; and (3) conduct drug testing, subject to state and local law.

At the same time, the shift in federal policy may lead to increased scrutiny of certain approaches—particularly strict zero-tolerance policies applied to off-duty medical marijuana use. Risk is most likely to arise where: (1) an employee uses medical marijuana outside of work; (2) there is no evidence of on-the-job impairment; or (3) the employer takes adverse action based primarily on a positive drug test.

Employers should ensure that policies are tied to legitimate business needs, including workplace safety, compliance obligations, and job performance.

4. Medical vs. Recreational Distinction Remains Critical

The DOJ’s order draws a clear distinction between medical and non-medical marijuana. Only products tied to FDA approval or state medical licensing qualify for Schedule III treatment. Recreational marijuana remains federally prohibited.

Although this distinction may be difficult to apply in practice, it remains important for compliance purposes.

5. Department of Transportation (DOT) Requirements Remain in Effect

For employers subject to Department of Transportation (DOT) regulations, current drug testing rules remain unchanged. The DOT has not yet issued updated guidance following the rescheduling, and prior agency statements suggest that changes will not be automatic. Employers with safety-sensitive, DOT-regulated employees should continue testing for marijuana and enforcing existing prohibitions on its use.

6. Continued Importance of State Law

The rescheduling does not override state marijuana or employment laws. Employers must continue navigating overlapping and sometimes inconsistent requirements, including medical marijuana statutes, disability discrimination laws, off-duty conduct protections, and state and local limitations on drug testing. 

Practical Steps for Employers

In light of this evolving landscape, employers should consider:

• Reviewing and updating drug and alcohol policies
• Reevaluating accommodation procedures for medical marijuana-related requests
• Training HR personnel and managers on handling marijuana-related issues
• Ensuring policies distinguish between impairment and lawful off-duty conduct
• Monitoring developments from the DEA, DOT, and courts

Looking Ahead

The DEA’s upcoming administrative hearing—and potential further rulemaking—could significantly reshape federal marijuana policy. In addition, anticipated litigation may influence how courts interpret the interaction between federal classification, state laws, and workplace obligations.

For now, the rescheduling of marijuana is another significant event in the ongoing shift in how  marijuana is treated under state and federal law, while preserving employers’ existing ability to maintain workplace safety and compliance. Employers should take a measured approach: continue applying current policies, but be prepared for evolving expectations and increased scrutiny and challenges, particularly in the accommodation and off-duty conduct context.

Young discussed how buyers may adapt to the tougher regulatory environment, noting:

“The 36-month rule does not restrict changes in minority ownership of already-enrolled providers. So you could still see capital flowing and being deployed in this space through partial stakes, partial-stake acquisitions and recapitalization.”

The full article is available here.

At the same time, the DOJ directed the Drug Enforcement Administration (DEA) to conduct a formal administrative hearing, beginning June 29, 2026, to consider whether marijuana more broadly should be rescheduled.

Although this development reflects a meaningful shift in federal policy, it does not legalize marijuana at the federal level. Instead, it introduces a more complex regulatory environment with important—and evolving—implications for employers.

Scope of the Rescheduling Order

The April 2026 order is limited in scope. It applies only to:

• Marijuana-based drug products approved by the Food and Drug Administration (FDA)
• Marijuana handled within state-regulated medical marijuana programs

All other marijuana—including recreational cannabis, most bulk marijuana, and products outside these regulatory channels—remains classified as a Schedule I controlled substance and therefore illegal under federal law.

This creates a dual framework under federal law, where marijuana may be treated differently depending on whether it qualifies as a regulated medical product. Employers should continue to distinguish between medical and non-medical marijuana use when addressing workplace issues.

The order also establishes a federal registration pathway for certain state-licensed medical marijuana operators, reflecting increased federal reliance on state regulatory systems.

A Shift in Federal Recognition—But Not Full Alignment

By moving qualifying marijuana products to Schedule III, the federal government has formally recognized that marijuana has accepted medical uses and a lower potential for abuse than Schedule I substances.

However, this change does not place medical marijuana on the same footing as traditional prescription medications in all respects. The CSA, the Americans with Disabilities Act, and other federal laws have not been amended, and the use of recreational marijuana remains federally prohibited. Employers should view this development as a policy shift that introduces new considerations, rather than a complete overhaul of existing legal obligations.

Key Implications for Employers

1. Increased Focus on ADA Accommodation Requests

Employers should anticipate an increase in accommodation requests tied to applicants’ and employees’ medical marijuana use.

Historically, courts rejected such claims based on the ADA’s definition of “individual with a disability,” which excludes an individual who currently engages in the illegal use of drugs, and marijuana’s status as a Schedule I controlled substance with no accepted medical use under federal law. Following rescheduling, that rationale may be subject to greater challenge—particularly where individuals are using marijuana under the supervision of a licensed health care professional and/or in compliance with state medical programs.

That said, employers are not required to automatically permit medical marijuana use. Instead, they should continue to: (1) engage in the interactive process where appropriate; (2) assess whether a requested accommodation is reasonable; and (3) evaluate whether the applicant’s or employee’s use poses a “direct threat,” particularly in safety-sensitive roles.

Employees may increasingly argue that state-authorized medical marijuana should be treated similarly to other Schedule III medications, although federal law does not yet treat these products identically. Employers should also continue to account for applicable state medical marijuana and disability discrimination laws, many of which independently provide protections for medical marijuana cardholders.

2. State “Lawful Product” Laws: Potential Reconsideration of Prior Claims

The rescheduling may also introduce new uncertainty under state “lawful product” or off-duty conduct laws.

In several jurisdictions, courts have previously rejected claims by employees or applicants who were disciplined or denied employment based on marijuana use—even where that use was permitted under state law. In those cases, courts often relied on statutory language protecting only conduct involving products that are “lawful” under federal or state law. Because marijuana was classified as a Schedule I substance, courts concluded it remained unlawful under federal law and therefore fell outside the scope of those protections.

The reclassification shift to Schedule III may prompt renewed challenges to those interpretations. Individuals may argue that marijuana—particularly when used in compliance with state medical marijuana programs—no longer categorically fails the “lawfulness” requirement that previously barred such claims. It remains unclear how courts will evaluate these arguments.

Employers operating in states with lawful product or off-duty conduct protections should monitor developments closely and consider how these laws may apply as the federal landscape continues to evolve.

3. Drug Testing and Workplace Policies Remain Permissible—But May Face Scrutiny

The DOJ’s order does not directly regulate workplace policies. Employers generally retain the ability to: (1) prohibit marijuana use, possession, and impairment during work; (2) maintain drug-free workplace policies; and (3) conduct drug testing, subject to state and local law.

At the same time, the shift in federal policy may lead to increased scrutiny of certain approaches—particularly strict zero-tolerance policies applied to off-duty medical marijuana use. Risk is most likely to arise where: (1) an employee uses medical marijuana outside of work; (2) there is no evidence of on-the-job impairment; or (3) the employer takes adverse action based primarily on a positive drug test.

Employers should ensure that policies are tied to legitimate business needs, including workplace safety, compliance obligations, and job performance.

4. Medical vs. Recreational Distinction Remains Critical

The DOJ’s order draws a clear distinction between medical and non-medical marijuana. Only products tied to FDA approval or state medical licensing qualify for Schedule III treatment. Recreational marijuana remains federally prohibited.

Although this distinction may be difficult to apply in practice, it remains important for compliance purposes.

5. Department of Transportation (DOT) Requirements Remain in Effect

For employers subject to Department of Transportation (DOT) regulations, current drug testing rules remain unchanged. The DOT has not yet issued updated guidance following the rescheduling, and prior agency statements suggest that changes will not be automatic. Employers with safety-sensitive, DOT-regulated employees should continue testing for marijuana and enforcing existing prohibitions on its use.

6. Continued Importance of State Law

The rescheduling does not override state marijuana or employment laws. Employers must continue navigating overlapping and sometimes inconsistent requirements, including medical marijuana statutes, disability discrimination laws, off-duty conduct protections, and state and local limitations on drug testing. 

Practical Steps for Employers

In light of this evolving landscape, employers should consider:

• Reviewing and updating drug and alcohol policies
• Reevaluating accommodation procedures for medical marijuana-related requests
• Training HR personnel and managers on handling marijuana-related issues
• Ensuring policies distinguish between impairment and lawful off-duty conduct
• Monitoring developments from the DEA, DOT, and courts

Looking Ahead

The DEA’s upcoming administrative hearing—and potential further rulemaking—could significantly reshape federal marijuana policy. In addition, anticipated litigation may influence how courts interpret the interaction between federal classification, state laws, and workplace obligations.

For now, the rescheduling of marijuana is another significant event in the ongoing shift in how  marijuana is treated under state and federal law, while preserving employers’ existing ability to maintain workplace safety and compliance. Employers should take a measured approach: continue applying current policies, but be prepared for evolving expectations and increased scrutiny and challenges, particularly in the accommodation and off-duty conduct context.

What NJ Employers Need to Know:

• Private lawsuits are now permitted: applicants can sue covered employers directly for adverse hiring decisions based on cannabis test results.
• Immediate litigation risk: covered employers face increased exposure tied to rescinded offers and pre-employment drug testing protocols.
• Broad implications likely: although the case involves hiring, its reasoning may extend to discipline and termination decisions.
• Policy updates required: employers hiring in New Jersey should promptly audit drug testing, hiring processes, and documentation practices.

Background on CREAMMA

CREAMMA (N.J. Stat. § 24:6I-31 et seq.) was signed into law by former New Jersey Governor Phil Murphy on February 22, 2021.  Under the law, individuals over twenty-one years of age may legally purchase, use, and possess up to six ounces of regulated cannabis.  In legalizing recreational cannabis use, the legislature sought to eliminate the collateral consequences of cannabis-related arrests and to encourage individuals to seek treatment for substance use disorders.  CREAMMA also significantly impacts New Jersey employers.  With certain federal exceptions (e.g., federally-regulated contractors), employers may not take adverse employment action against applicants or employees solely because they have tested positive for cannabis.  While employers may maintain a drug-free workplace and conduct drug testing to determine whether an employee is impaired on the job, they may not refuse to hire, terminate, or otherwise retaliate against an employee based solely on evidence of cannabis use.

Under CREAMMA, employers can conduct drug testing as a part of pre-employment screening, upon reasonable suspicion of cannabis use in the workplace, through random testing of employees in safety-sensitive positions or post-accident testing.  If an employee is found to be impaired or using cannabis while working, an employer can take an appropriate employment action.  Critically, however, no adverse action can be taken solely because an employee used cannabis recreationally during off-hours.  Instead, an employer is required to support any adverse actions with both objective testing results and documented physical or behavioral indicators of impairment.

The Decision: A Landmark First for New Jersey

On May 26, 2026, the Appellate Division issued its published decision in Sanders v. The Levari Group, LLC (the decision can be found here), addressing whether CREAMMA provides an implied private right of action that allows a job applicant to sue a prospective employer for refusing to hire the applicant based on a positive cannabis drug test.

The plaintiff, Darlene Sanders, applied for a customer service position with the defendant company.  After interviewing, she received and accepted a job offer that was contingent on her completing a pre-employment drug test.  Sanders tested positive for cannabis metabolites, which indicated prior cannabis use within the previous thirty days.  However, she maintained she was not under the influence at the time of testing or during the hiring process.  The employer offered Sanders the chance to retake the test at her own expense, which Sanders declined citing financial constraints.  As a result, the employer rescinded the offer.

Sanders filed suit asserting claims for violations of CREAMMA, as well as negligence, invasion of privacy, breach of contract, and wrongful discharge under New Jersey common law.  The trial court dismissed the complaint, concluding that CREAMMA did not provide a private right of action and enforcement authority rested with regulators (the New Jersey Cannabis Regulatory Commission (“CRC”)), not the courts. The Appellate Division disagreed.

As a matter of first impression, the Appellate Division held that CREAMMA implicitly provides a private right of action for individuals who claim they were denied employment because of cannabis use.  The decision effectively permits job applicants to bring claims against employers for adverse hiring decisions based on cannabis test results. 

Applying New Jersey’s established framework for implied causes of action, the court concluded that recognizing a private right is consistent with the legislative intent behind CREAMMA.  Specifically, the Court held that:

• Applicants who test positive for cannabis are the precise group CREAMMA was designed to protect;
• The statute uses rights-creating language and does not establish an exclusive administrative enforcement scheme; and
• Without a private remedy, the law’s anti-discrimination protections would be effectively unenforceable. Thus, the remedy is consistent with the statute’s underlying purpose.

Based on these factors, the court reinstated Sanders’ statutory claim and revived related claims for negligence, invasion of privacy, and breach of contract. However, the court affirmed dismissal of the plaintiff’s common law wrongful discharge claim, limiting that doctrine to termination—not hiring—decisions.

The Impact

Before Sanders, many employers viewed CREAMMA as lacking real enforcement teeth. That assumption is no longer viable. The decision effectively creates a new category of employment claims in New Jersey.

Covered employers that rescind offers based solely on a positive cannabis test—without evidence of impairment—may now face direct liability. This is especially significant given that cannabis metabolites may remain detectable long after use.

Further, although Sanders arose in the hiring context, the court’s reasoning is not limited to applicants. Plaintiffs may attempt to extend the holding to decisions related to discipline, termination and workplace investigations involving suspected cannabis use.

What Employers Should Do Now

Until the State Supreme Court weighs in, Sanders is considered the law of the land.  Employers looking to minimize any associated risk presented should consider:

• Reevaluating drug testing programs by assessing whether pre-employment cannabis testing is necessary for all roles, and ensuring testing policies align with roles that may legitimately require impairment-related safeguards;
• Modifying hiring practices by avoiding automatic disqualification based solely on cannabis test results, implementing individualized assessments where possible, and carefully documenting legitimate, non-discriminatory reasons for hiring decisions;
• Strengthening policies/handbooks, onboarding materials and training protocols; and
• Identifying high-risk categories by conducting targeted analysis for safety-sensitive roles and evaluating whether additional compliance steps or exceptions may apply.

We will continue to monitor developments and provide updates. Please reach out to the authors or your Seyfarth attorney with any questions.

*Emily Cronin is a Summer Associate on Seyfarth’s Labor & Employment team. Many thanks for her contribution to this update.

In this episode of Claims & Sustains, Teddie Arnold breaks down the Administration’s recent use of the Defense Production Act to accelerate investment in U.S. energy infrastructure. What looks like energy policy is really a major shift in government contracting—unlocking fast-moving funding opportunities, new deal structures, and heightened compliance risks. We walk through what the determinations do, why the waiver authority matters, and how contractors can position themselves before DOE dollars start flowing.

Seyfarth Synopsis: The National Federation of the Blind (NFB) sued Department of Justice (DOJ) and Health and Human Services (HHS), claiming that the agencies’ Interim Final Rules extending WCAG 2.1 AA compliance deadlines for state and local governments and recipients of HHS assistance violated the Administrative Procedure Act’s notice-and-comment requirements and were arbitrary and capricious.

On May 21, 2026, the National Federation of the Blind (NFB) filed a new lawsuit challenging DOJ and HHS’ recent decision to push back deadlines for making WCAG 2.1 AA compliant the websites and mobile apps of state and local governments (previously discussed here), as well as recipients of HHS funding. 

As background, DOJ and HHS issued final rules in 2024 requiring state and local governments with populations over 50,000, as well as recipients of federal funding with 15 or more employees, to make their websites and mobile apps accessible under WCAG 2.1 AA. 

The deadline for larger governments – previously April 24, 2026, is now April 26, 2027.  The deadline for HHS assistance recipients – previously May 11, 2026, is now May 11, 2027. 

The NFB’s suit, filed in Maryland federal court, challenges those extensions under the Administrative Procedure Act.  The NFB argues that DOJ and HHS had no valid “good cause” to bypass the public notice-and-comment requirement before issuing the Interim Rules.  NFB also contends that DOJ’s extension is arbitrary and capricious because the agency did not seriously consider the impact of delaying accessibility on people with disabilities and relied on information that was not actually new. Against HHS, NFB asserts that the agency relied too heavily on anecdotal evidence, did not adequately consider the disability community’s input, and even undermined its own cost-benefit findings by extending the deadlines.

The Complaint includes a number of real-world examples from NFB members who have been harmed by the extension, such as people being unable to complete unemployment applications, register businesses, enroll in classes, access telehealth services, or quickly pay medical bills because websites and digital forms were not accessible. According to the Complaint, these barriers led to delays, added costs, and significant frustration.

The NFB is asking the Court to declare the extensions illegal, vacate (i.e., set aside) the Interim Final Rules entirely, and Order DOJ and HHS to enforce the original deadlines from the 2024 final rules.

What should covered entities do now?  The practical answer is they should be continuing to make their websites and mobile apps accessible without delay. The extension was granted in part to ensure that covered entities would have enough time to comply with their obligations, and DOJ stated in the interim final rule extending the Title II deadlines that it expects to fully implement the regulation at the new deadlines.  From our experience, covered entities will need every minute of additional time to comply.

Edited by: John W. Egan  

The Facts

Daniel Husband was hired by Target Corporation in October 2020 as a fulfillment employee. After approximately twenty months of uneventful employment, in June and July 2022 there were incidents in which Husband was emotional, erratic, and irrational, including engaging in confrontations with coworkers, claiming that inanimate objects were “laughing” at him, and making statements suggesting that he may have harmed others. Supervisors found the conduct disturbing and sent Husband home, recommending that he seek medical evaluation.

On July 9, 2022, Target terminated Husband for violating its workplace violence policy. At the time of termination, Husband had not disclosed any disability or requested accommodation.

Husband later provided a medical note clearing him to return to work, but the note did not disclose any diagnosis. He subsequently filed suit asserting claims under the California Fair Employment and Housing Act (FEHA) for (1) disability discrimination, (2) failure to accommodate, and (3) failure to engage in the interactive process.

The Trial Court’s Decision

The trial court granted Target's motion for summary judgment on all of Husband’s claims, concluding that there were no triable issues of material fact as to any of the asserted FEHA causes of action. In particular, the court determined that Husband could not establish the threshold requirement that Target had knowledge of his alleged disability at the time it made the decision to terminate his employment.

The undisputed evidence showed that Husband never disclosed his bipolar disorder to Target, and the court found that his workplace conduct, while unusual and concerning, was susceptible to multiple reasonable interpretations, including non-disability-related explanations. As a result, the court held that the observed behavior did not compel the conclusion that Husband was suffering from a mental disability, and therefore could not support imputing knowledge of such a disability to the employer.

The Court of Appeal’s Decision

The Court of Appeal affirmed the judgment, centering its analysis on the foundational requirement that an employer must have knowledge of an employee’s disability in order to incur liability under FEHA. The Court emphasized that this knowledge requirement is not merely a peripheral consideration, but rather a necessary predicate to each of the statutory theories advanced by Husband.

Where an employee does not disclose the existence of a disability, the law permits knowledge to be imputed to the employer only in narrow circumstances. Specifically, such imputation is appropriate only where the employee’s observable conduct compels the conclusion that a disability is present—either because the disability is the only reasonable interpretation of the known facts, or because the employee’s symptoms are so objectively obvious and indicative of an underlying condition that the existence of a disability necessarily follows.

Applying these principles, the Court of Appeal concluded that the record did not support imputing knowledge of Husband’s bipolar disorder to Target. Although Husband’s behavior was problematic, the Court of Appeal reasoned that such conduct, standing alone, did not meet the demanding standard required to establish constructive knowledge under FEHA. The Court of Appeal noted that while Husband’s actions could be interpreted as symptomatic of a mental health condition, they were equally susceptible to a range of alternative, non-disability-related explanations, including the effects of stress, medication interactions, substance use, or sleep deprivation. Because these alternative explanations were objectively reasonable, the existence of a mental disability was not the only reasonable inference that could be drawn from Husband’s behavior. Accordingly, Target could not, as a matter of law, be charged with knowledge of Husband’s condition.

The Court of Appeal rejected Husband’s various attempts to circumvent the knowledge requirement. First, it declined to adopt the proposition that unusual or “bizarre” behavior, without more, is sufficient to place an employer on notice of a disability, explaining that such a rule would effectively collapse the distinction between observable conduct and diagnosable condition. Second, the Court of Appeal rejected the argument that conduct associated with a disability should be equated with knowledge of the disability itself, noting that such an approach would improperly assume that employers possess the expertise to identify mental health conditions based on isolated symptoms. Third, the Court of Appeal declined Husband’s invitation to relax the knowledge requirement on equitable grounds based on his alleged inability to recognize or disclose his condition during the relevant period. The Court of Appeal explained that FEHA’s statutory framework expressly requires employer knowledge. In so doing, the Court reaffirmed that FEHA does not impose a duty on employers to be “clairvoyant,” nor does it authorize liability for failing to accommodate or respond to disabilities of which the employer is unaware.

What Husband Means for Employers

The Court of Appeal’s analysis reinforces that employers will not be held liable in the absence of knowledge of a disability. However, employers must remain mindful of the statutory duties to provide reasonable accommodation and to engage in the interactive process upon notice of a disability—whether through disclosure, third-party information, or sufficiently obvious symptoms.

The Health Law Committee plays a critical role in advancing the City Bar’s mission through producing reports and policy statements, hosting programs and events, and organizing CLE and career development initiatives. 

Young’s appointment will take effect on September 1, 2026.

At least in the United States, the answer is currently no. Inventors must be natural persons.

Problem solved. Or perhaps not.

While lawyers, courts, and the USPTO have spent the past several years debating whether AI can be listed on a patent application, a more interesting question has quietly emerged.

What happens when AI does not invent the technology, but instead invents the innovation strategy?

Patent law revolves around the concept of conception. The Federal Circuit has repeatedly described conception as the touchstone of inventorship. Put simply, an inventor must possess a definite and permanent idea of the complete invention. The inventor must know what the invention is before reducing it to practice.

The question becomes more complicated as AI systems evolve from research assistants into innovation engines.

Researchers are developing platforms that combine methodologies such as TRIZ (Theory of Inventive Problem Solving), graph databases, and multi-agent AI frameworks. Rather than simply answering questions, these systems analyze existing technologies, identify technical contradictions, generate potential solutions, predict future development paths, and even recommend patent strategies.

Imagine an engineer working on battery technology. The engineer asks an AI system how to improve charging efficiency without increasing heat generation. The AI analyzes thousands of patents, technical papers, and product specifications. The AI identifies an overlooked technical relationship, proposes a novel architecture, predicts performance improvements, recommends claim language, and suggests a continuation strategy to protect adjacent implementations.

The engineer reviews the proposal, recognizes its value, and instructs the engineering team to build it.

Who conceived of the invention?

Under current law, the answer may still be the engineer. After all, the engineer identified the problem, evaluated the solution, and directed further development.

But the facts begin to look different from the traditional conception story that patent law has relied upon for decades.

Historically, the inventor had the idea and used tools to implement the idea. Increasingly, the tool may be generating the idea while the human decides whether the idea is worth pursuing.

The USPTO’s Answer: AI Is a Tool

In November 2025, the USPTO revised its guidance on AI-assisted inventions and largely simplified the analysis. The Office rescinded its earlier guidance and explained that there is no special inventorship standard for AI-assisted inventions. The same legal principles apply regardless of whether an inventor used a laboratory instrument, a computer program, a research database, or an AI system.

The USPTO’s position is straightforward: AI systems are tools.

According to the guidance, AI is analogous to software, laboratory equipment, or other instruments that assist human inventors. AI may provide information, suggestions, and even ideas, but AI itself cannot be an inventor. The relevant inquiry remains whether a natural person conceived the claimed invention.

For today’s AI systems, that approach makes a great deal of sense.

The challenge is that tomorrow’s AI systems may look very different from today’s.

The Real Question

The recent USPTO guidance treats AI as a tool, and for today’s systems that characterization is entirely reasonable.

But the guidance also highlights a deeper issue.

Patent law was built on the assumption that conception occurs in the mind of a human inventor. The doctrine works well when humans generate ideas and machines help execute them. The doctrine becomes more difficult to apply when machines increasingly generate ideas and humans decide which ones deserve attention.

The harder question is whether future AI innovation platforms will remain merely tools, or whether they will become something patent law has never encountered before: systems capable of generating the very conception that inventorship doctrine was designed to identify.

The USPTO has answered today’s question by confirming that AI is a tool, not an inventor.

Whether that answer remains sufficient ten years from now is far less certain.

And if that day arrives, the most important person in the inventive process may not be the engineer, the patent attorney, or even the inventor.

It may be the person who wrote the prompt.

Watch Episode 18 Here:

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The article analyzes the Supreme Court’s unanimous ruling in M&K Employee Solutions v. Trustees of the IAM National Pension Fund, which resolved a circuit split and confirmed that actuarial assumptions used to calculate withdrawal liability do not need to be selected before the end of the plan year. The authors highlight how this interpretation reinforces plan sponsor flexibility while underscoring the potential for employer liability to remain uncertain—and even increase—after withdrawal.

As Kim and Gillam explain, the decision emphasizes accuracy over rigid timing requirements:

“Allowing assumptions to be selected later ensures the valuation reflects the best available information tied to that date, consistent with the statutory focus on accuracy rather than timing.” 

The full article is available here.

New Project Media featured Corporate partner Christopher Cottrell in its article, “Seyfarth partner dissects ERCOT’s Batch Zero proposal’s importance for near-term projects.” The piece centers on Cottrell’s analysis of ERCOT’s proposed Batch Zero framework and its potential impact on near-term data center and large load interconnection projects in Texas.

Cottrell highlighted how Batch Zero is intended to prioritize commercially mature projects while discouraging speculative queue entries, and outlined key tradeoffs between speed, certainty, cost, and upfront commitment. He also examined unresolved questions around implementation, cost allocation, and regulatory alignment, emphasizing how early participation could create meaningful advantages—or disadvantages—for developers navigating ERCOT’s interconnection process.

Underscoring the importance of readiness, Cottrell noted:

“Although no process will eliminate speculative activity entirely, requiring projects to demonstrate site control, commercial readiness and financial commitment should make the queue more realistic over time.” 

The full article is available here.

Flowers Foods, Inc. v. Brock stems from a proposed class action filed in 2022 by drivers for an independent distributor of Flowers Foods. The drivers alleged that Flowers Foods misclassified them as independent contractors and underpaid them. These drivers picked up baked goods that arrived from out-of-state which were kept in a local warehouse, and then transported them to retail stores along their intrastate route. They never crossed state lines and never interacted directly with vehicles that did.

Flowers Foods moved to compel arbitration pursuant to an arbitration provision contained in the parties’ distribution agreement. The district court denied the motion, and the Tenth Circuit followed suit, reasoning that the drivers fell within Section 1’s exemption because their intrastate deliveries “formed a constituent part of the … interstate journey” from Flowers’ out-of-state bakeries to their ultimate destinations, the retail stores. The fact that the drivers never crossed state lines or directly interacted with interstate vehicles was not dispositive.

Flowers petitioned for review, urging the Supreme Court to adopt a bright line rule—that a worker can never qualify for the exemption unless the worker personally crosses state lines or directly loads or unloads a vehicle that did.

In a unanimous decision, the Supreme Court refused to create such a rule and affirmed the Tenth Circuit ruling. The Court found that neither the text of Section 1 nor its prior decisions supported the bright-line rule advocated by Flowers. Nothing in the statute expressly requires a worker to cross state lines or interact directly with a vehicle that does. Instead, the relevant inquiry is whether the class of workers “play[s] a direct and necessary role in the free flow of goods across borders.”

The Court drew support from its 2022 decision in Southwest Airlines Co. v. Saxon, in which airline cargo loaders qualified for the exemption even though they neither flew planes nor crossed state lines themselves. According to the Court, the focus is not on whether workers personally traverse state boundaries, but rather on the role they play in the interstate journey of the goods.

The Court also examined definitions of the terms “engage” and “interstate commerce” at the time of the FAA’s enactment. The Court observed that those definitions likewise contained no requirement that an individual personally cross state lines or directly interact with a vehicle engaged in interstate travel. The Court also looked to historical case precedent to reinforce its conclusion. The Court cited various cases decided in the decades preceding the FAA’s enactment. While those cases arose under the Commerce Clause, the Court found them highly probative of what it meant to be “engaged in commerce between the States” when Congress enacted the FAA.

Notably, the Court emphasized that Flowers Foods had raised several alternative arguments as to why the drivers may not qualify for the exemption, but chose not to seek review of those issues. It is unknown whether the Court’s outcome would have been different had Flowers asked it to discuss the ramifications of these issues. For example, Flowers observed that the drivers worked pursuant to a distribution agreement rather than a traditional employment contract, an issue some lower courts have considered relevant to whether a “contract of employment” exists for purposes of Section 1. Flowers also noted that the distributor took title to the baked goods before selling them to local retailers, a fact that some lower courts have considered relevant when determining whether they remained part of a continuous interstate journey.

Because Flowers elected to focus exclusively on securing a bright-line rule requiring interstate travel or direct interaction with interstate vehicles, the Court declined to address the significance of those other issues Flowers raised in passing. In effect, Flowers placed all of its emphasis on a single argument, and the Court rejected it.

As a result, several important questions remain unresolved. The Court did not address whether Section 1 applies to a contract between two business entities or to workers operating under a distribution agreement, rather than a traditional employment contract. Nor did it decide whether taking title to goods before transporting them within a state – such as for couriers fulfilling take-out orders made within a state – creates a new and distinct intrastate transaction for the goods, outside the scope of Section 1.

The decision leaves open other broader questions concerning the outer boundaries of the transportation worker exemption. While the Court made clear that drivers may qualify even when they never cross state lines or directly interact with interstate vehicles, it remains unclear whether warehouse workers, retail employees, or other non-drivers who handle goods that previously traveled in interstate commerce may likewise fall within the exemption. As that issue was not before the Court, lower courts will continue to grapple with where the interstate journey ends, and which workers are sufficiently connected to it. These questions are already the subject of active litigation across the country, and will continue to be litigated until the Supreme Court agrees to weigh in once again.

NAIOP’s Developing Magazine published an article by Corporate partner Michael Delaney, “Cold Storage Investment: The Case for Temperature‑Controlled Real Estate.” The piece, published in the Summer 2026 issue, examines why temperature‑controlled warehousing has evolved from a niche property type into a core component of the modern industrial real estate landscape.

The article highlights the powerful demand drivers behind cold storage growth — including e‑commerce, online grocery, and pharmaceutical innovation — and explains how supply constraints, high barriers to entry, and CPI‑linked leases are creating durable, inflation‑resilient investment opportunities. Delaney also explores the financial profile, development complexity, and risk considerations investors must navigate to succeed in this specialized asset class.

As Delaney notes in the article:

“Cold storage has shifted from a niche to a core pillar of the industrial ecosystem. In the process, temperature‑controlled warehousing is transforming into one of the most compelling strategic investment opportunities in the modern real estate landscape. In a yield‑starved environment, this specialized asset class combines resilience with strong growth potential and offers a natural hedge against inflation.”

The full article is available here.

The coverage examines how the ruling is expected to increase potential withdrawal liability exposure and create greater uncertainty for participating employers.

Kim emphasized the significance of the decision for employers considering withdrawal, noting in Law360: “It’s a big deal. I think it potentially opens up the employers to larger withdrawal liability, for sure.”

He told SHRM that the ruling represents a major win for plan sponsors and a cautionary development for contributing employers, explaining: “The decision is a significant victory for plan sponsors of underfunded multiemployer pension plans and something that all contributing employers should be aware of, in terms of how their withdrawal liability exposure can significantly increase from participation in such plans.”

In Westlaw Today, Kim highlighted the increased discretion now afforded to plan sponsors and actuaries, stating: “This ruling provides plan sponsors and actuaries with significantly more discretion in choosing assumptions for calculating withdrawal liability, including which ‘discount rate’ to use for determining how future benefit payments are discounted back to their present value.”

The full articles are available here:

• Law360: Justices’ ERISA Ruling May Raise Withdrawal Liability Costs

• SHRM: ‘Withdrawal Liability’ May Rise After Supreme Court Decision

• Westlaw Today: SCOTUS affirms D.C. Circuit ruling on multiemployer pension plan exit assumptions

The coverage underscores Rosen and Smith’s deep experience handling complex wage‑and‑hour and employment class actions and highlights the growing volume of such litigation in Washington state. 

In Law360, Smith emphasized the strategic fit between his practice and Seyfarth’s national platform, noting:

“Seyfarth’s national scope, reputation in the market and impressive bench made joining the firm an easy choice and natural fit for me and Katie. We’re excited to help grow the employment class action practice at Seyfarth in Washington and beyond.” 

Smith also highlighted the firm’s leadership in responding to the rapid increase in employment class actions across the state, explaining:

“Seyfarth is at the leading edge of defending these cases and developing effective strategies for clients — whether that means driving down potential exposure, challenging class certification or making favorable law.” 

International Employment Lawyer introduced its story with the sub-headline: ‘’Powerful’ duo bolster firm’s wage and hour strengths in Seattle.’

This recognition highlights Seyfarth’s leadership in driving innovation across the legal industry and advancing the strategic use of emerging technologies—including its proprietary AI-powered SEYscraper tool that is revolutionizing litigation workflows and changing how attorneys and clients approach case strategy.

The Women in Business Law Awards celebrate top lawyers and firms that are "championing gender diversity in the legal sector."

Thursday, June 18, 2026
1:00 p.m. to 2:00 p.m. Eastern
12:00 p.m. to 1:00 p.m. Central
11:00 a.m. to 12:00 p.m. Mountain
10:00 a.m. to 11:00 a.m. Pacific

About the Program

When an employee resigns, what walks out the door with them? In today’s environment of remote work, cloud storage, and generative AI tools, the answer is often more than employers realize—and the window to respond is narrow.

Join Seyfarth for the next installment of our Trade Secrets Webinar Series, where our cross-functional team will provide a practical, real-world look at how digital exfiltration occurs and what organizations can do to prevent and respond to it.

Drawing on experience across trade secrets law, cybersecurity, and digital forensics, our speakers will break down the key legal, technical, and operational considerations every employer should understand.

Key Discussion Points

• Why digital exfiltration risk is increasing in a remote, cloud-based, and AI-enabled workplace
• Common methods employees use to take sensitive data—and how to identify red flags
• High-risk data categories and where organizations are most vulnerable
• Best practices for confidentiality agreements and restrictive covenants
• Designing effective offboarding protocols and exit procedures
• Technical safeguards, including monitoring tools and data loss prevention strategies
• How to investigate suspected exfiltration and preserve forensic evidence
• Immediate response strategies, including demand letters and injunctive relief
• Risks and considerations for the hiring (new) employer

This webinar is designed for in-house counsel, HR professionals, IT and security leaders, and business executives responsible for safeguarding confidential information and managing employee transitions.

Speakers

Jay Carle, Partner, Seyfarth Shaw LLP

Marcus Mintz, Partner, Seyfarth Shaw LLP

Joe Greenfield, President & Chief Forensic Examiner, Maryman

REGISTER HERE

If you have any questions, please contact Sela Sofferman at ssofferman@seyfarth.com and reference this event.

Learn more about our Trade Secrets, Computer Fraud & Non-Competes practice.

To comply with State CLE Requirements, CLE forms requesting credit in IL or CA must be received before the end of the month in which the program took place. Credit will not be issued for forms received after such date. For all other jurisdictions forms must be submitted within 10 business days of the program taking place or we will not be able to process the request.

Our live programming is accredited for CLE in CA, IL, and NY (for both newly admitted and experienced).  Credit will be applied as requested, but cannot be guaranteed for TX, NJ, GA, NC and WA. The following jurisdictions may accept reciprocal credit with our accredited states, and individuals can use the certificate they receive to gain CLE credit therein: AZ, AR, CT, HI and ME. For all other jurisdictions, a general certificate of attendance and the necessary materials will be issued that can be used for self-application. CLE decisions are made by each local board, and can take up to 12 weeks to process. If you have questions about jurisdictions, please email CLE@seyfarth.com.

Please note that programming under 60 minutes of CLE content is not eligible for credit in GA. programs that are not open to the public are not eligible for credit in NC.

But the shift to CLUB COASTAL presents a different issue—one that highlights the importance of clearance prior to adoption of a new trademark.

Coastal Caviar has filed new applications for CLUB COASTAL covering clothing and online retail store services featuring clothing and jewelry. However, existing registrations for COASTAL (covering clothing and corresponding retail services) and COASTAL and Design (covering jewelry) are owned by third parties.

CLUB COASTAL may be viewed as confusingly similar to these prior marks:

• The dominant term of each mark may be considered COASTAL;
• CLUB may be perceived as a modifier rather than a meaningful point of distinction;
• The goods and services, clothing, jewelry, and related retail, may be considered similar or related.

As a result, CLUB COASTAL could be found confusingly similar to the prior registered marks. Further, Coastal Caviar could find itself in a case of déjà vu all over again if an owner of the prior registered marks raises an objection. 

This underscores a familiar but often overlooked principle: rebranding does not eliminate risk if the new mark has not been cleared. Even where a brand is moving away from one dispute, it may step directly into another if the new name overlaps with existing third‑party rights. That makes clearance essential before filing, launching, or investing in a new name. At a minimum, that analysis should consider:

• Prior registered and applied‑for marks using the same dominant term;
• Whether additional wording meaningfully distinguishes the mark;
• The relatedness of goods and services; and
• The availability of a mark not already crowded by similar uses.

Clearance can save time, money, and headaches. It can also prevent rebrands, which can be expensive. Just like a bottle of champagne and tin of caviar. 

We’ll keep an eye out and provide any further updates.

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Episode 46: Vetoed No More – Virginia’s New Paid Leave Landscape

In the first episode of 2026, Take It Or Leave It host Josh Seidman is joined by Dillon Clair of the ERISA Industry Committee (ERIC) to unpack the latest developments shaping the paid leave landscape. Together, they explore how Virginia emerged as a focal point this year, enacting both paid family medical leave and paid sick and safe leave laws after years of legislative momentum and prior vetoes.

The conversation dives into key provisions of Virginia’s new laws, including timelines, employer compliance considerations, and evolving definitions of “family member”—a critical issue for multi-state employers. Josh and Dillon also preview other states to watch in 2026, offering practical insights to help employers stay proactive amid an increasingly complex and rapidly shifting regulatory environment.

Read the full transcript here. 

Welcome back to the Week in Weed, your Friday look at what’s happening in the world of legalized marijuana. This week, we find out Virginia Governor Spanberger’s reasons for vetoing the retail cannabis market bill. A hemp lawsuit brought by Smart Approaches to Marijuana has been dismissed. The Drug Enforcement Administration will hold a hearing on rescheduling next month. And finally, Cannabis Empowerment Week is coming up soon!

VIRGINIA

Many, including we at The Blunt Truth, were surprised when Virginia Governor Abigail Spanberger (D) vetoed a retail cannabis market bill. Spanberger has spent some time since her decision explaining her rationale. She has cited concerns that the bill would have led to a “rushed launch” which would repeat the mistakes of other states and that there would be too many stores. In addition to displeasing a majority of Virginia voters, the Governor has admitted that even her own friends and family members are unhappy with her decision. Will the next session lead to an agreement? Who knows!

HEMP LAWSUIT

Smart Approaches to Marijuana (SAM), an organization opposed to cannabis legalization, brought a lawsuit in opposition to the government’s new plan to cover up to $500 worth of hemp-derived products each year for eligible Medicare patients. Late last week, a federal judge dismissed SAM’s claim, citing a lack of standing.

“Plaintiffs’ case suffers from a fatal flaw: the failure to establish Article III standing to bring their claims” – Judge Trevor N. McFadden

SAM may appeal this ruling, so stay tuned!

DEA HEARING ON RESCHEDULING

And speaking of SAM, they have filed a notice to participate in the hearings that the Drug Enforcement Administration (DEA) is scheduled to hold next month on a broad federal rescheduling of cannabis. Rest assured, the National Organization for the Reform of Marijuana Laws (NORML) has filed a notice to appear as well. That should make for a lively discussion.

AND FINALLY

Each year, the City of Boston Cannabis Industry Development Team celebrates Cannabis Empowerment Week. And since it’s never too early to get ready for a holiday, take note that this year’s events will occur June 15-21. The theme this year is “Social in the City,” an exploration of social consumption, which we’re assuming means cannabis lounges, on-site consumption and the like.

Be well everyone – we’ll see you next week.

It has been a busy spring for data privacy in the Southeast. On April 17, 2026, Alabama Governor Kay Ivey signed the Alabama Personal Data Protection Act (HB 351). Weeks later, on May 11, 2026, Governor Kemp signed Georgia’s SB 111. There is an important caveat there: although the Senate-passed version of SB 111 carried the title “Georgia Consumer Privacy Protection Act,” the House substituted the bill’s entire text with unrelated amendments to the rural hospital tax credit. The Senate agreed to the substitute on April 2, and the version Kemp ultimately signed has nothing to do with consumer privacy. Legislative tracking services continue to display the original title, which has caused understandable confusion, but Georgia did not enact a comprehensive privacy law this session.

That leaves the Southeast with three states currently operating under a comprehensive privacy statute: Florida (in effect since 2024), Tennessee (in effect since 2025), and Alabama (taking effect in 2027). Georgia remains a state to watch, with sponsors expected to introduce a successor measure when the new General Assembly convenes in 2027. And in keeping with the national trend, each state’s “omnibus” law (or proposed law) takes a slightly different approach with qualifying thresholds and defined terms. This article provides a short summary of what businesses operating in the region need to know and what they should be working on today.

Who Is Covered: Three Enacted Laws and Three Thresholds (and a Note on Georgia)

The biggest difference among the three enacted statutes is the way each defines businesses that must comply.

Florida’s Digital Bill of Rights (FDBR), which took effect on July 1, 2024, has the narrowest scope by a wide margin. The FDBR imposes obligations on controllers with annual global revenue of more than $1 billion that also meet one of three additional criteria: derive 50% or more of annual revenue from selling online ads, operate a consumer smart speaker with an integrated virtual assistant, or operate an app store with at least 250,000 applications. By design, the majority of the FDBR’s controller obligations apply only to the largest tech and platform companies. As a practical matter, most Southern businesses will never need to worry about Florida’s controller obligations, though enforcement has now begun. The Florida AG’s October 2025 action against Roku is a useful reminder that the FDBR is no longer dormant for the companies that do qualify.

Tennessee’s Information Protection Act (TIPA), which took effect on July 1, 2025, takes a middle approach. TIPA applies only to entities with more than $25 million in annual revenue that also meet one of two conditions: control or process the personal information of at least 175,000 Tennessee consumers, or control or process the personal information of at least 25,000 Tennessee consumers while deriving more than 50% of gross revenue from the sale of personal information. The 175,000-consumer threshold is the highest of any state privacy law to date and significantly narrows the law’s application for most companies.

The Alabama Personal Data Protection Act (APDPA) takes a different tack. It applies to entities that process the personal data of more than 25,000 Alabama consumers (excluding payment transaction data), or that derive more than 25% of gross revenue from the sale of personal data. There is no minimum revenue threshold, and the 25% revenue prong applies regardless of how many consumers’ data the entity processes. Alabama exempts businesses with fewer than 500 employees (provided they are not selling personal data) and nonprofits with fewer than 100 employees under similar conditions. This employee-count exemption is notably broader than most state omnibus laws and echoes the approach of the Texas TDPSA’s small-business exception keyed to the SBA definition.

For reference, Georgia’s failed SB 111 would have applied to entities conducting business in Georgia with more than $25 million in annual revenue that also met one of two consumer-count thresholds (25,000 plus 50%-of-revenue from sale, or 175,000), broadly in line with the Virginia model. Any 2027 successor is likely to look substantially similar.

The definition of “consumer” in each of the enacted statutes continues to exclude individuals acting in an employment or commercial context.

The NIST Safe Harbor: A Tennessee Feature Worth Watching in Georgia

One provision sets Tennessee apart from its Southeastern neighbors. Controllers and processors are allowed to assert an affirmative defense to violations if they maintain a written privacy program that reasonably conforms to the current NIST Privacy Framework. Georgia’s failed SB 111 contained a parallel provision, and the NIST safe harbor is widely expected to be a feature of any Georgia successor measure as well.

For businesses already aligned with NIST standards, TIPA offers a meaningful compliance advantage. For Georgia-based businesses without a documented privacy program, the prospect of a future Georgia statute with a NIST safe harbor offers a forward-looking reason to begin building one now. Even absent a Georgia statute, a NIST-aligned program supports compliance under TIPA for Tennessee residents and provides defensible risk-management posture under Georgia’s evolving common law data protection standards.

Cure Periods and Enforcement

All three enacted statutes grant enforcement authority exclusively to the state Attorney General, with no private right of action. Cure periods and penalties vary:

Alabama provides a permanent 45-day cure period before the AG may initiate enforcement. Civil penalties may reach $15,000 per violation.

Tennessee provides a 60-day cure period. Courts may impose civil penalties of up to $7,500 per violation, with treble damages available for willful or knowing violations.

Florida provides a 45-day cure period at the AG’s discretion. The cure period is unavailable for violations involving a known child. Civil penalties run up to $50,000 per violation and are tripled (to $150,000) for violations involving known children, failure to delete or correct after request, or continued sale or sharing after opt-out.

For comparison, Georgia’s failed SB 111 would have required a 60-day cure period and authorized penalties of up to $7,500 per violation, with treble damages for knowing or willful violations.

Data Protection Assessments

Florida and Tennessee both require controllers to conduct data protection assessments for high-risk processing activities, including targeted advertising, the sale of personal information, certain profiling activities, processing of sensitive data, and other processing posing a “heightened risk of harm to consumers.”

Alabama does not require data protection assessments, an omission that sets it apart from most comprehensive state privacy laws.

Georgia’s failed SB 111 would have required data protection assessments along the same lines as Tennessee and the broader Virginia model.

Universal Opt-Out Signals

For now, unlike what we have seen in California and Colorado, none of the enacted Southeastern laws require the recognition of universal opt-out mechanisms or other website functionality associated with opt-out preference signals or GPC controls.

Definition of “Sale”

The way each state defines the “sale” of personal data affects which disclosures and sharing arrangements trigger opt-out rights.

Alabama attempts to split the difference between narrow and broad definitions. The law covers exchanges of personal data for monetary or “valuable consideration” where the controller receives a material benefit and the third party is not restricted in its subsequent use of the data. The definition excludes disclosures to processors, affiliates, third parties providing requested products or services, and several other categories. Alabama’s approach may limit unintended consequences while still capturing targeted advertising arrangements where ad tech partners can reuse data beyond the scope of services rendered.

Tennessee and Florida each follow variations of the Virginia model, generally defining sale as an exchange of personal data for monetary or other valuable consideration, with carve-outs for processor relationships, mergers, and consumer-directed disclosures.

Children’s Data Protections

The three enacted statutes address children’s data to varying degrees. Alabama requires consent before processing the data of consumers ages 13 to 15 for targeted advertising or sale, addressing the gap between COPPA (which covers children under 13) and adulthood. Tennessee aligns with familiar COPPA thresholds and requirements and requires consent before processing sensitive data of known children. Florida imposes notably stricter requirements: it requires affirmative authorization before processing the personal data of minors between 13 and 17, prohibits targeted advertising directed to any known child under 18, and triples civil penalties for violations involving known children. The Roku enforcement action turns largely on these children’s data provisions.

Effective Dates

Businesses preparing for compliance should note the following timelines:

Florida: Already in effect (July 1, 2024)

Tennessee: Already in effect (July 1, 2025)

Alabama: Takes effect May 1, 2027

Georgia: SB 111 substituted in House; watch the 2027 session for a successor measure

Practical Observations

For businesses operating across the Southeast, several themes emerge.

Florida remains a narrow concern for most companies. Its $1 billion revenue threshold means most businesses will not be subject to its controller obligations. That said, the FDBR is no longer untested. The AG’s office has begun pursuing enforcement actions, particularly around children’s data, and companies that do meet the thresholds should not assume the law will remain dormant.

Tennessee is the most consequential statute in the Southeast for most mid-to-large businesses currently. The applicability thresholds are high, but the law is in force and the NIST safe harbor is a meaningful incentive to formalize a privacy program.

Alabama’s lower thresholds will capture more mid-sized businesses than Tennessee. The absence of a revenue floor combined with the 25,000-consumer threshold means companies that fall below Tennessee’s requirements may still need to comply in Alabama. The 500-employee exemption provides relief for smaller operations not engaged in data sales, though the 25% revenue-from-sales prong applies regardless of company size and could pull in even small data brokers.

Georgia has not yet enacted a comprehensive privacy law, but Georgia-based businesses should not mistake their home state’s silence for an absence of obligations. Georgia organizations with consumers in Tennessee, Alabama (once effective), or any of the other states with comprehensive privacy laws are subject to those statutes when applicable thresholds are met. Georgia’s own data breach notification statute remains in force, federal sectoral regimes (HIPAA, GLBA, FERPA, FCRA) continue to apply, and Georgia courts have been actively developing common law data protection standards. A Georgia statute also remains a real prospect for the 2027 session, and the structural features of any successor measure (Virginia-model thresholds, NIST safe harbor, DPA requirement) are likely to track what SB 111 proposed.

What Should Companies Do Now?

Assess your collection and processing activities. Businesses with collection and processing activities that meet applicable thresholds should assess their data practices now. With Alabama’s effective date in 2027 and Tennessee already in force, businesses should inventory their data collection, evaluate their processing purposes, and review their vendor contracts. Take a careful look at each state’s threshold numbers and remember that mobile applications and website forms can accumulate personal information for state residents quickly in a calendar year.

Consider creation (or enhancement) of a NIST-aligned privacy program. In addition to being an exceptional outline for enhanced compliance and data protection generally, businesses subject to Tennessee already have a valuable opportunity for a potential affirmative defense, and any Georgia successor is likely to offer the same. These programs take time to scope and build. My recommendation is to begin engaging internal stakeholders and external legal and technical resources now rather than waiting on the legislative calendar.

Conduct data protection assessments. DPAs are required for controllers in Tennessee involved in targeted advertising, the sale of personal information, certain types of profiling, or the processing of sensitive data. Florida imposes similar requirements at its higher threshold. Even absent an Alabama or Georgia statutory requirement, the exercise necessarily involves a useful evaluation of all activities associated with the collection, processing, and sharing of personal information. As with building a NIST-aligned program, this takes time to accomplish, and it is best to get started on the groundwork now.

Georgia-based businesses, in particular, should resist the temptation to treat Georgia’s lack of a statute as the end of the inquiry. Most Georgia businesses of any meaningful size will hold personal information of residents of one or more states that do have comprehensive laws, and the most efficient compliance posture is to design a program that addresses the most demanding applicable standard rather than retrofit for each new state as it arrives.

There are still several discrete differences across the region, but companies with personnel or operations in the Southeast should take this opportunity to reassess their footprint of regional privacy compliance and regulatory requirements.

On Friday, May 22, US Citizenship and Immigration Services (USCIS) issued a Policy Memorandum (Memorandum) that could meaningfully affect how Adjustment of Status applications (Adjustment) are adjudicated moving forward, though USCIS implementation details remain limited and operational impacts are still developing. While the Memorandum does not change the statutory eligibility requirements for Adjustment under the Immigration and Nationality Act (INA or Act), it signals a potentially significant shift in how immigration officers may exercise discretion when adjudicating Adjustment applications. The Memorandum emphasizes that Adjustment is an “extraordinary act of administrative grace” because it exempts the foreign national from having to exit the United States to complete green card processing and should only be exercised sparingly.

What is an Adjustment of Status?

Adjustment of Status allows eligible foreign nationals already in the United States to apply for permanent residence without departing the United States to complete processing abroad. For many employers and employees, this process has historically provided continuity and predictability by allowing eligible individuals to remain in the United States during this process.

Consular processing, by contrast, generally requires immigrant visa processing through a U.S. embassy or consulate overseas. Such processing depends on appointment availability, security checks, and country-specific conditions, which involve additional uncertainty, travel obligations, and time away from work and familial responsibilities. Additionally, it invokes the doctrine of consular non-reviewability, meaning that unlike stateside denials, such denials cannot be challenged. Simply put, once the foreign national departs the United States, it is very difficult to predict when – or if – they will be able to return.

What Remains Unclear

The practical implications and implementation of the Memorandum remain uncertain. USCIS has not provided detailed guidance regarding whether the policy will apply to pending cases, what factors will carry the greatest weight in discretionary determinations, or how the newly announced standard will be applied across family, employment, and investment-based immigration categories. Will individuals with certain visa types be exempted? What will happen to applications already in process? Will there be a clear standard for review?

We do know that limited Requests for Evidence regarding the exercise of discretion have been issued by immigration officers, even before the Memorandum's publication. We have also heard that questions at family-based adjustment interviews have recently probed applicants’ reasons for seeking Adjustment instead of consular processing, whether there are factors preventing consular processing, whether the applicant has family in the United States, and reasons for overstaying their initial visa.

At this stage, stakeholders should be cautious about drawing firm conclusions, such as agency guidance, adjudication patterns, stakeholder engagement, and litigation may significantly shape how, or whether, the policy materially changes current practice.

Why Employers Are Paying Attention

The Memorandum reaches across every immigration category. Employers that utilize  lawfully sponsored foreign talent, including highly skilled professionals, researchers, healthcare workers, multinational employees, and other essential personnel, should be monitoring developments closely because Adjustment is an established mechanism that allows eligible individuals already present in the United States to continue contributing to employers and the economy while pursuing permanent residence. Additionally, denials of applications can lead to certain individuals immediately losing work authorization.

As with other programs that have been implemented, Administration officials have indicated that exceptions will exist for individuals who contribute economically or advance national interests. However, the Memorandum itself leaves important implementation questions open, and stakeholders will be watching closely to understand how discretion is exercised in actual adjudications.

Legal Questions and Litigation Emerging

Adjustment of status has always required the foreign national to demonstrate not only that they meet the statutory criteria, but also that their case warrants a favorable exercise of discretion. The Memorandum acknowledges such discretion; however, it signals a materially narrower interpretation of that discretion than has historically been applied. The Memorandum essentially reads into the law a strong presumption favoring consular processing. Important questions remain regarding implementation, including how USCIS may apply the guidance to pending applications, whether adjudication trends or discretionary standards evolve in practice, and whether aspects of implementation ultimately draw legal challenge. Additional clarity may emerge from future agency guidance, adjudicatory patterns, or developments in litigation.

As noted, the Memorandum and its implementation by USCIS and individual immigration officers may be challenged. A coordinated stakeholder response is emerging through business and legal organizations, trade associations, advocacy groups, and industry coalitions. While no legal challenges have been filed to date, such challenges could be brought by businesses, healthcare organizations, or universities that rely on foreign talent and the predictability of adjustment of status as a green card pathway, as well as by the EB-5 community. Potential challenges may focus on whether USCIS can effectuate such a broad policy shift through internal guidance rather than notice-and-comment rulemaking, whether the Memorandum is consistent with the Act, and whether the new discretion framework is being applied in a manner that produces inconsistent or effectively categorical denials. Additional concerns center on whether the Memorandum mischaracterizes or selectively reads the case law it cites as authority. Challengers may also argue that the policy disrupts settled reliance interests, both for individuals already sponsored for permanent residence and for the institutions that have structured their talent pipelines around established adjustment pathways.

Employer Considerations

Organizations that have employees who could be impacted by the Memorandum should consider internal planning and employee communication strategies. Employers with potentially affected populations may consider proactive outreach to acknowledge developments, reinforce known facts, and help reduce unnecessary concern while additional information becomes available.

It is important to recognize that implementation details and the practical scope of the Memorandum will continue to evolve. Communications and outreach efforts with the Administration, along with potential litigation and policy developments, could provide additional clarification regarding how broadly the Memorandum will ultimately be interpreted and applied. Early reactions may not fully reflect the final operational impact, and historical implementation of immigration policy has often evolved through agency guidance, stakeholder engagement, and judicial review. Employers should remain attentive to developments, balancing preparedness with measured decision-making as additional information becomes available.

For more information, contact your Seyfarth relationship partner or the authors directly. Seyfarth’s Immigration Compliance & Investigations specialty group is recognized as a national leader in the field. Trusted by Fortune 100 companies and small businesses nationwide, the team provides strategic, practical guidance across the full spectrum of immigration compliance. The group advises on Form I-9 and E-Verify compliance; ICE inspections and worksite enforcement actions; internal immigration assessments and I-9 audits; DOL immigration-related wage-and-hour investigations; H-1B compliance; and DOJ’s IER and OCAHO anti-discrimination matters, including foreign sponsorship and export control/ITAR issues. The team complements its expertise in the Immigration Compliance & Investigations sector with its first-in-class litigation capabilities.

Seyfarth Synopsis:  For California employers, compliance with the Fair Chance Act (FCA) is not a game. In recent years, the California Civil Rights Department (CRD) has stepped up its investigations into complaints of FCA violations, and employers who don’t know the rules risk landing on a chute at every turn. Read on for our guide to navigating compliant background check practices and staying ahead of CRD enforcement.

The stakes are getting higher for California employers, who are seeing an increase in charges filed with the California Civil Rights Department (CRD) alleging violations of the California Fair Chance Act (FCA). This trend follows the CRD’s expanded regulations governing the use of criminal history in employment decisions, which became effective October 1, 2023, and reflects the agency’s heightened focus on FCA compliance in response to complaints filed by applicants and employees. Make no mistake, the CRD is not handing out Get Out of Jail Free cards.

Continue reading for an overview of the rules of the game, including the FCA legal framework, compliance areas the CRD typically examines when FCA charges are filed, and steps employers can take to prepare for and defend against these inquiries.

The Fair Chance Act Rulebook and the 2023 Regulatory Clarifications

The FCA generally requires California employers to:

• Delay inquiry into or consideration of criminal history until after a conditional offer of employment—this includes ordering a criminal history background report;
• Conduct an individualized, job‑related assessment before rejecting an applicant based on criminal history; and
• Follow a two‑step notice process—a preliminary determination notice and a final determination notice—when taking action based on criminal history, regardless of how the information is obtained.

Regulatory amendments approved in 2023 clarified and expanded several key compliance obligations, including:

• Expanding the definition of “applicant” to include certain current employees whose criminal history is reviewed due to changes in ownership, management, policies, or practices.
• Reaffirming that employers may not include language in job advertisements or postings suggesting that individuals with criminal histories will not be considered.
• Prohibiting employers from considering voluntarily disclosed criminal history prior to a conditional offer.
• Clarifying that exemptions for legally mandated background checks apply only when the employer itself is required by law to conduct the check.
• Requiring an initial individualized assessment before issuing a preliminary decision notice.
• Expanding the categories of mitigating and rehabilitative evidence employers must consider, including trauma, disability‑related circumstances, and evidence of rehabilitation.

Time to Show Your Cards: What the CRD Looks for When a Charge Lands

When an applicant or employee files a charge alleging an FCA violation, the CRD’s investigation commonly extends beyond the narrow factual allegation to examine whether the employer complied with related FCA requirements across the board. In those investigations, the CRD typically focuses on the following areas:

1. Timing of Criminal‑History Inquiries

The CRD routinely evaluates whether the employer rolled the dice before their turn and made any inquiry—directly or indirectly—into criminal history before making a conditional offer of employment, including:

• Questions on employment applications
• Interview conversations
• Informal recruiter or hiring‑manager inquiries
• Reliance on information volunteered too early in the application process

1. Individualized Assessments

The FCA does not require an employer to document its assessment. But, like a game of Clue, the CRD expects employers to show their winning strategy, and frequently requests documentation demonstrating that the employer:

• Conducted the required initial individualized assessment before issuing a preliminary decision notice;
• Considered each of the three statutory factors (i.e., the nature and gravity of the offense or conduct, the time that has passed since the offense, conduct, or completion of sentence, and the nature of the job sought or held)s; and
• Connected the assessment to the actual duties and risks of the position.

2. Notice and Response Procedures

The CRD commonly examines whether:

• The preliminary and final determination notices included all required materials, including the conviction‑history report and a statement that the individual has the right to file a complaint with the CRD;
• The applicant or employee was afforded the full response period required by regulation; and
• The employer refrained from making a final decision before the response period expired.

3. Consideration of Mitigating or Rehabilitative Evidence

When an applicant plays a new card—submitting mitigating or rehabilitative evidence—employers must factor it into their next move. Investigators often assess whether the employer:

• Accepted and evaluated all mitigating or rehabilitative information submitted;
• Conducted and documented a meaningful reassessment; and
• Considered trauma‑related, disability‑related, or other mitigating factors where applicable.

4. Consideration of Convictions Older than Seven Years

Although California law permits employers to consider convictions older than seven years—outside the City and County of San Francisco and unincorporated areas of Los Angeles County—doing so can be a risky gambit as the CRD frequently asks whether the employer relied on older convictions.

These inquiries reflect the CRD’s publicly stated position, including guidance posted on its website, prohibiting reliance on older criminal records. Employers should be prepared to articulate and document why consideration of an older conviction was job‑related and consistent with business necessity. The CRD will expect a heightened showing of job-relatedness.

Your Next Move: Getting Ahead of the Charge

The best defense is a good strategy. Employers facing an FCA charge—or seeking to reduce future exposure—should consider the following moves:

1. Check the Board: Audit Criminal‑History Decision‑Making Processes

Review job postings, applications, interview materials, recruiter scripts, conditional offer letters, and pre-adverse (preliminary determination) and adverse action (final determination) templates to ensure compliance with FCA requirements.

2. Play the Right Cards: Strengthen Documentation of Individualized Assessments

Use job‑specific assessment tools that address the three required factors and prompt decision‑makers to consider rehabilitation and mitigation evidence.

3. No Skipped Turns: Ensure Compliance with Notice and Timing Requirements

Confirm that notices include required attachments and language, response deadlines are properly calculated, and reassessments are documented.

4. Teach the Rules: Train Recruiters, HR, and Hiring Managers

Training should focus on prohibited inquiries, handling volunteered information, and the required assessment and notice procedures.

The Endgame

An FCA charge can trigger searching inquiries into how an employer evaluates criminal history and implements required assessment and notice procedures. Don’t wait until the other player sits down at the board. Employers should ensure their practices are well‑documented, consistently applied, and aligned with the current regulatory framework — before the CRD takes a look first.

Workplace Solutions

Don’t roll the dice and hope to avoid scrutiny of your background check practices.If you need help navigating FCA compliance or an FCA CRD charge, the author of this article or your favorite Seyfarth lawyer are here to help employers develop a winning strategy.

Edited By: Catherine Feldman

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Health Care Beat Episode 56 – AI & Health Care: Innovation, Regulation, and Reality – Part 3: AI Governance in the Hospital Setting

On this episode of Health Care Beat, we continue our series on the intersection of artificial intelligence and health care. Divya Reddy, Senior Director & Senior Corporate Counsel at Houston Methodist Hospital, joins co-hosts Amanda Genovese and Chris DeMeo to discuss the role of AI governance in the hospital setting. Divya shares how Houston Methodist’s AI Governance Committee was established and how it has evolved over time; the types of AI tools being proposed and deployed across the organization; how new AI technologies are identified, evaluated, and vetted; and the critical role in-house counsel plays throughout the process.

For a transcript of this episode, please click here.

Regionally, Seyfarth's Melbourne and Sydney offices both ranked Tier 1 for Employee Benefits Law, Labour and Employment Law, and Occupational Health and Safety Law.

Private Equity Law Report quoted Steven Richman, chair of Seyfarth’s Institutional Investor practice, in its article, “ILPA Study Gauges Evolving LP Sentiments Toward PE Allocations and LPA Negotiations.” The piece, published on May 28, 2026, examines findings from ILPA’s latest Limited Partners sentiment study, including return expectations, negotiating leverage and key fund terms.

Richman highlighted how shifting return assumptions may affect fund economics, noting:

“When LPs adjust their five-year expected return profile down, one of the inferences I make is that LPs anticipate that some more funds could find themselves in a clawback position. And that will certainly bring more caution to the market.”

The full article is available here.

The IAM Patent 1000 "identifies the leading patent practitioners and firms from around the globe, offering the definitive ‘go-to’ guide for those seeking legal expertise."

Read more about the rankings here.

Coverage highlights Mouradian’s arrival as a strategic enhancement to Seyfarth’s commercial and real estate litigation capabilities across a myriad of industries. It also underscores the firm’s continued focus on expanding high-value litigation services and fostering cross-practice collaboration—both in Los Angeles and nationwide.

In an interview with Law360, Mouradian discussed how his move to Seyfarth will enhance his high-stakes litigation practice and cross practice collaboration, explaining:

"Being able to fuse those two things together will definitely help me elevate my practice and deliver best-in-class service to all my clients. That was really what attracted me to Seyfarth."

He further emphasized how Seyfarth’s artificial intelligence tools and technology platforms align with his commitment to innovation in legal practice, noting:

"Seyfarth is reimagining the practice of law with the use of all this legal technology, including artificial intelligence. Law firms have had a hard time keeping up with AI, except for firms like Seyfarth, who have been ahead of the curve."

Recent public debate following the Federal Court’s decision in Giggle v Tickle has prompted a private member’s bill introduced on 25 May 2026 by a National Party MP seeking to amend the Sex Discrimination Act 1984 (Cth) (SDA). The bill seeks to introduce clearer, and in some contexts prioritised, protections based on biological sex—particularly in areas such as single-sex facilities, services and spaces. The Coalition has indicated support for these changes.

While the bill’s prospects remain uncertain, it raises important questions for employers about how potential legislative change may intersect with existing workplace obligations.

A shifting legal landscape

At present, the SDA protects individuals from discrimination on the basis of both sex and gender identity. Employers are therefore required to ensure that workplace policies and practices do not unlawfully discriminate on either ground.

The proposed amendment signals a potential shift towards giving primacy to biological sex in specific contexts. Even if the legislative change is not enacted in its current form, the broader policy debate reflects increasing scrutiny around how competing protected attributes are balanced in practice.

For employers, this highlights the importance of remaining agile and informed as the legal landscape evolves.

Workplace impact: where issues may arise

Although the proposal is focused on areas such as bathrooms, accommodation and certain services, there are clear overlaps with workplace settings. Employers may need to consider how any changes could affect:

• Workplace facilities – including access to bathrooms, change rooms or other sex-specific spaces
• Policies and procedures – particularly diversity, inclusion, anti-discrimination and workplace behaviour policies
• Dress codes and uniform requirements
• Participation in workplace programs or initiatives that may be sex- or gender-specific

In many cases, these issues already require careful navigation. Any legislative amendment may add further complexity rather than providing a simple resolution.

Managing competing rights and obligations

A key challenge for employers is balancing potentially competing rights—particularly where the rights of individuals based on sex and gender identity may intersect.

Employers should be mindful that:

• Anti-discrimination obligations will continue to apply, even if their scope changes
• Work health and safety duties require employers to provide safe working environments for all employees
• Respectful workplace expectations remain critical, regardless of legal developments

Even if reforms prioritise biological sex in certain contexts, this will not eliminate the need for careful, case-by-case assessment and sound judgement.

Practical considerations for employers

In light of this development, employers may wish to proactively consider:

• Policy review: Are existing policies sufficiently clear, current and adaptable to potential legal change?
• Consistency: Are workplace decisions being made consistently and in line with documented policies?
• Training and communication: Are managers equipped to navigate sensitive issues lawfully and appropriately?
• Escalation processes: Are there clear pathways for handling complaints or conflicts involving competing rights?
• Documentation: Are decisions well-reasoned and recorded, given the potential for scrutiny?

Taking a proactive approach can help mitigate risk, regardless of whether legislative reform proceeds.

The continued role of judgement and expertise

Importantly, even with increased legislative clarity, these issues are unlikely to become purely rules-based. Many workplace scenarios will still require nuanced judgment, taking into account legal obligations, organisational context and employee wellbeing.

For employers, this underscores the ongoing importance of seeking legal guidance when navigating complex or sensitive situations.

Looking ahead

The proposed amendment is part of a broader and evolving national conversation about the scope and operation of discrimination law. Whether or not this particular bill is passed, it highlights the potential for change and the need for employers to stay informed.

We will continue to monitor developments and provide insights as the position becomes clearer.

While the bill’s prospects remain uncertain, it raises important questions for employers about how potential legislative change may intersect with existing workplace obligations.

A shifting legal landscape

At present, the SDA protects individuals from discrimination on the basis of both sex and gender identity. Employers are therefore required to ensure that workplace policies and practices do not unlawfully discriminate on either ground.

The proposed amendment signals a potential shift towards giving primacy to biological sex in specific contexts. Even if the legislative change is not enacted in its current form, the broader policy debate reflects increasing scrutiny around how competing protected attributes are balanced in practice.

For employers, this highlights the importance of remaining agile and informed as the legal landscape evolves.

Workplace impact: where issues may arise

Although the proposal is focused on areas such as bathrooms, accommodation and certain services, there are clear overlaps with workplace settings. Employers may need to consider how any changes could affect:

• Workplace facilities – including access to bathrooms, change rooms or other sex-specific spaces
• Policies and procedures – particularly diversity, inclusion, anti-discrimination and workplace behaviour policies
• Dress codes and uniform requirements
• Participation in workplace programs or initiatives that may be sex- or gender-specific

In many cases, these issues already require careful navigation. Any legislative amendment may add further complexity rather than providing a simple resolution.

Managing competing rights and obligations

A key challenge for employers is balancing potentially competing rights—particularly where the rights of individuals based on sex and gender identity may intersect.

Employers should be mindful that:

• Anti-discrimination obligations will continue to apply, even if their scope changes
• Work health and safety duties require employers to provide safe working environments for all employees
• Respectful workplace expectations remain critical, regardless of legal developments

Even if reforms prioritise biological sex in certain contexts, this will not eliminate the need for careful, case-by-case assessment and sound judgement.

Practical considerations for employers

In light of this development, employers may wish to proactively consider:

• Policy review: Are existing policies sufficiently clear, current and adaptable to potential legal change?
• Consistency: Are workplace decisions being made consistently and in line with documented policies?
• Training and communication: Are managers equipped to navigate sensitive issues lawfully and appropriately?
• Escalation processes: Are there clear pathways for handling complaints or conflicts involving competing rights?
• Documentation: Are decisions well-reasoned and recorded, given the potential for scrutiny?

Taking a proactive approach can help mitigate risk, regardless of whether legislative reform proceeds.

The continued role of judgement and expertise

Importantly, even with increased legislative clarity, these issues are unlikely to become purely rules-based. Many workplace scenarios will still require nuanced judgment, taking into account legal obligations, organisational context and employee wellbeing.

For employers, this underscores the ongoing importance of seeking legal guidance when navigating complex or sensitive situations.

Looking ahead

The proposed amendment is part of a broader and evolving national conversation about the scope and operation of discrimination law. Whether or not this particular bill is passed, it highlights the potential for change and the need for employers to stay informed.

We will continue to monitor developments and provide insights as the position becomes clearer.

Subscribe to receive the next Workplace Law & Strategy blog direct to your inbox.

Finkel highlighted the difficulty of navigating multiple definitions of joint employment, noting:

“Avoiding a finding of joint employment when considering the various sources of potential liability is a headache. Employers, in consultation with their lawyers and HR professionals, need to determine which of those sources poses their most significant risk and structure their relationships with other companies based on that source’s definition.”

The full article is available here.

By: Minh N. Vu

In early May, the state of Missouri enacted a new law – which becomes operative on August 28, 2026 – to protect Missouri “residents” from abusive lawsuits alleging inaccessible websites or web content.  Missouri ranked sixth in the nation for 2025 website lawsuit filings in our annual review, with 86 such suits, compared to the leader, New York, which had 1,021.  A closer look at the Missouri federal and state court dockets revealed that one plaintiff (represented by a single firm) was responsible for every single one of the 121 website accessibility lawsuits filed in 2024 and 2025.    

The new law authorizes a defendant that is a Missouri resident in a lawsuit alleging that the defendant’s website or web content fails to provide sufficient access under the Americans with Disabilities Act (ADA) or similar state laws (a “Web Access Suit”) can file its own civil action in any court of “competent jurisdiction” against the plaintiff and/or the plaintiff’s attorneys who brought the Web Access Suit to determine if the Web Access Suit is “abusive litigation.”  The law defines “abusive litigation” as litigation whose primary purpose “is obtaining a payment from a defendant due to the costs of defending the action in court.”

The law also empowers the Missouri Attorney General to bring a civil action on behalf of Missouri residents – or intervene in a pending action—against abusive litigation.

To determine if litigation is abusive, courts will consider the “totality of the circumstances.”

The law specifies the following factors to be considered:

(a) Whether the same plaintiff, attorney, or law firm has filed a high number of substantially similar lawsuits without meaningful efforts to resolve or improve accessibility;

(b) Whether the plaintiff provided the defendant with reasonable notice and an opportunity to correct the alleged barrier(s) prior to filing suit;

(c) Any history of sanctions or findings of bad faith against the plaintiff or counsel;

(d) The nature of settlement discussions and the reasonableness of settlement offers and refusals to settle;

(e) Whether any factors under Missouri Supreme Court Rule 55.03(b) exist in the litigation (e.g. filing for an “improper purpose” such as harassment or to increase litigation costs, or without evidentiary support) and whether sanctions are appropriate under Missouri Supreme Court Rule 55.03(c).

Notably, the law establishes a rebuttable presumption that litigation is abusive if a defendant “receives written notice of an alleged website or web content access violation and in good faith initiates substantial steps to correct it within ninety days.”  This rebuttable presumption essentially forces plaintiffs to give defendants ninety days to fix any alleged violations before filing a lawsuit about the violations.  Otherwise, the lawsuit would be presumptively considered abusive litigation.

If a court finds the Web Access Suit to be abusive, it can order the plaintiff and plaintiff’s attorneys in the Web Access Suit to pay the defendant’s attorney’s fees and costs to defend that lawsuit, as well as the fees and costs it incurred in prosecuting the lawsuit authorized by the new Missouri law.  A court may also order punitive damages or sanctions against the law firm and plaintiff that filed the abusive lawsuit, not to exceed three times the amount of attorney’s fees awarded by the court.

It will be very interesting to see whether this new law will have any deterrent effect on Web Access Suit plaintiffs and their lawyers, or whether any defendants in Web Access Suits will use it as a counteroffensive measure.  Defendants may hesitate to pursue claims under this statute, given the added legal costs and the prospect of litigating on two separate fronts.  The Missouri Attorney General has far greater resources and could make a meaningful impact by pursuing actions against plaintiffs and their attorneys under this law.    

Kansas enacted a similar abusive website litigation law in 2023 and we have not been able to find any lawsuits filed under it.  That is not surprising, however, given Kansas’ minimal ADA Title III website lawsuit activity, even before the Kansas law was passed.  We shall see how it goes in Missouri. 

Edited by: Kristina M. Launey

Both chambers of the New York Legislature have passed a bill (S3460) that would require employers to provide employees with access to their personnel records and impose significant new recordkeeping and disclosure obligations on employers.

If signed by the Governor, the law would take effect 60 days after enactment, leaving employers with a relatively short window to assess and update compliance practices. Under New York’s legislative procedure, the bill could remain pending for many months before being presented to the Governor for approval or veto, and there is no current indication of when that might occur.

Access to Personnel Records 

The bill would amend the Labor Law by adding a new Section 210‑b which would require employers to provide employees with access to their personnel records upon request, subject to several key requirements:

• Timing: Employers must provide a copy of the personnel record within five (5) business days of receiving a written request;
• Cost: Records must be provided at no cost to the employee;
• Scope: The term “personnel records” is broadly defined to include records used, or records that may be used, in connection with an employee’s qualifications for employment, compensation, promotion, transfer, or discipline, including applications, evaluations, and disciplinary documents.

Employers would be prohibited from retaliating against employees who exercise their rights under the statute.

The legislation also would require employers to retain personnel records for at least three years after termination of employment.

The law would not supersede a Collective Bargaining Agreement where it provides substantially similar or greater access to personnel records.

Violations of these requirements would be subject to civil penalties of $500 to $2,500, enforceable by the Attorney General.

Notice of Negative Information and Employee Responses

The bill would impose a significant affirmative obligation on employers to notify employees when negative information is placed in their personnel file. Such notice must occur within 10 days, and employees must be allowed to submit a written statement disputing or explaining the information, which must be maintained alongside the record and provided to third parties when the record is shared.

What This Means for Employers

If enacted, S3460 would significantly change personnel record practices in New York. Employers should consider the following:

1. Increased Administrative Burden. Employers will need processes to respond to personnel record requests within five business days.
2. Expanded Documentation Scrutiny. Because employees will have ready access to personnel records, employers should anticipate increased scrutiny of performance evaluations, disciplinary documentation, and internal communications.
3. New Notice Obligations. The requirement to notify employees of negative information within ten days will require real-time tracking of disciplinary and evaluative actions.
4. Risk Associated with Record Content. The ability of employees to submit rebuttal statements may affect how personnel records are used in decision‑making and litigation, particularly when disclosed to third parties.
5. Policy and Process Updates. Employers may need to revise policies, train HR personnel, and standardize practices to ensure compliance with access, notice, and retention requirements.

Conclusion 

S3460 would introduce a comprehensive personnel records access regime in New York, aligning New York more closely with jurisdictions that provide employees formal access to their personnel records.

If enacted, the law will require employers to reassess how personnel records are created, maintained, and disclosed, and to implement new processes to meet statutory timelines and obligations.

We will continue to monitor developments and provide updates. Please reach out to the authors or your Seyfarth attorney with any questions.

Seyfarth government contracts attorney Zach Jacobson talks with Seyfarth construction attorney Sydney Jenkins about the U.S. Department of Transportation’s Interim Final Rule reshaping the DBE program and what it means for contractors working on federally funded transportation and airport projects. The conversation draws on Seyfarth’s recent Construction Seyt posts, “California’s DBE Reevaluation Deadline Is Here: What Contractors Need to Do Before April 16” and “USDOT’s DBE Interim Final Rule: How It Affects Current and Out-to-Bid DOT and Airport Projects.” For more, visit Construction Seyt: https://www.constructionseyt.com/

This recognition highlights Vaclavik as a trusted advisor in high-stakes matters with her deep understanding of deal dynamics and her ability to navigate complex, fast-moving transactions.

Read more here.

In a conversation with host Carolynn Johnson, president of SHRM CEO Action, Tyman explored what inclusion and diversity (I&D) compliance looks like amid heightened legal scrutiny and evolving enforcement priorities. Moving beyond theory, the discussion focused on the real-world decisions CHROs and HR leaders are making as they balance legal risk, organizational values, and transparent communication.

Tyman discussed the importance of designing inclusive programs—such as employee resource groups—in ways that are open, accessible, and aligned with equal opportunity principles.

“It is really going to depend on how the groups are created, what the purpose of the groups are, making sure that they are open and accessible to everyone, that you have charters that allow multiple types of employee resource groups, and you are not excluding any group on the basis of a protected category."

She further highlighted transparency as a critical leadership and compliance tool:

"An important message that you are going to want to leave your employees with is being transparent about the changes that are being made and demonstrating that you still have a commitment to equal opportunity for all."

The full episode of SHRM’s People + Strategy podcast is available here and a recap of the discussion can be read here.

Weiss highlighted how simple, memorable catchphrases can distill complex ideas into clear, impactful messages. He suggested that business leaders translate difficult concepts into brief, punchy statements that are easier for their audiences to understand and remember.

The full discussion can be heard at the 4:52 mark of the episode, "Noon Business Lunch 5/26/26: Networking, communication catch phrases, quantum funding, spring homebuying market."

Welcome back to The Week in Weed, your Friday look at what’s happening in the world of legalized marijuana. This week, the big news is coming out of Virginia, where there will not be a retail cannabis market. Meanwhile, the Transportation Security Administration will now allow medical marijuana on airplanes – maybe. The House Appropriations Committee has removed funding to reschedule cannabis. And finally, the Grand Ole Opry now has an official THC beverage.

VIRGINIA

Meet the new boss; same as the old boss. That’s the tune supporters of a cannabis retail market in Virginia are singing this week, as Governor Abigail Spanberger (D) vetoed a bill that would have allowed legal sales of adult-use marijuana.

“We were all hoping that under a Democratic governor, it would not be a question of whether we would have a retail marketplace, but when we would have a retail marketplace. And today’s veto is evident that those expectations were false hope.”

– Democratic Petersburg Senator Lashrecse Aird, sponsor of the vetoed bill

TRANSPORTATION SECURITY ADMINISTRATION

The rule has always been that cannabis is strictly forbidden in airports and on airplanes, even if those airports and airplanes are located in a state where cannabis is legal. Now, with medical cannabis moved to Schedule III, things may be different. The Transportation Security Administration (TSA) has issued new instructions concerning medical marijuana. They are perhaps not a model of clarity as regards whether you’ll definitely be able to bring your cannabis onboard, so you might want to just purchase what you need at your destination.

HOUSE APPROPRIATIONS COMMITTEE

Speaking of rescheduling, the House Appropriations Committee is not on board with it. They recently passed a funding bill that would prevent any federal funds from being used to reschedule cannabis. Since the Department of Justice has just done exactly that, the situation is a bit…awkward. Keep in mind that a similar provision has appeared in previous bills and never made it into law.

AND FINALLY

In a sign that times are truly changing for cannabis, the Grand Ole Opry has announced that Senorita THC Margaritas are now the venue’s official THC beverage.

Be well everyone – we’ll see you next week.

 Background

On May 14, 2026, Colorado Governor Jared Polis signed Senate Bill 26‑189 (“SB 189”), which substantially revises the state’s existing artificial intelligence regulatory framework and will take effect January 1, 2027. The new law replaces Colorado’s original AI regulation, Senate Bill 24-205, which was adopted in 2024 and following subsequent legislative action, was scheduled to take effect on June 30, 2026.  The law reflects a significant shift in regulatory approach after extensive stakeholder feedback and legislative reconsideration. Senate Bill 24-205 originally contained provisions establishing a duty of care, formal risk management requirements, and impact assessment obligations.  SB 189 removes several of these provisions and instead imposes a regulatory framework focusing on disclosure, transparency, and targeted consumer protections in connection with the use of automated decision‑making technology (“ADMT”) in “consequential decisions.”

While the substantive obligations of SB 189 take effect January 1, 2027, the state’s Attorney General’s office is charged with adopting rules to implement and clarify the requirements.  Covered entities should therefore expect substantive rulemaking activity in the near term and actively monitor those proceedings, as the forthcoming rules will define key terms and requirements essential to compliance planning.  The rules will be helpful as various covered industries, including employers, healthcare institutions, insurers, and others, will have unique considerations as they implement the Colorado requirements. 

Changes from Previously Enacted AI Law

The contrast between SB 189 and its predecessor is significant.  When Governor Polis signed SB 24-205 in May 2024, he did so with publicly stated reservations, explicitly encouraging the legislature to refine the approach before the law took effect.  That invitation set in motion a sustained reconsideration process.  The Governor convened an AI Policy Working Group, which engaged in approximately six months of structured stakeholder consultation before publishing a proposed framework in March 2026.  The legislative process moved quickly from that point, driven in part by the need to finalize a replacement statute before SB 24-205’s approaching  June 30, 2026 effective date.  Industry stakeholders and the AI Policy Working Group’s recommendations were central forces shaping the substance of the resulting legislation. SB 189 reflects that recalibration.

SB 24-205 imposed a formal duty of care, required detailed algorithmic impact assessments, and established a rebuttable presumption of compliance for entities following risk management frameworks, such as the NIST AI Risk Management Framework.  SB 189 removes each of these provisions entirely as explicit requirements.  In their place, the new law substitutes specific disclosure obligations, three-year record-keeping requirements, and a sixty-day pre-enforcement cure period administered by the Attorney General, that sunsets on January 1, 2030.  SB 189 also introduces an interesting fault-based framework for allocating discrimination liability between developers and deployers, a concept SB 24-205 did not address.

Scope: Covered Entities, Tools, and Use Cases

Covered ADMT and Exclusions

A covered ADMT is defined broadly as computational technology that processes personal data and generates outputs such as predictions, recommendations, classifications, or scores that are used to guide or assist decisions about individuals.  The statute excludes basic infrastructure technologies, tools used only to organize or present information for human review, and consumer‑facing conversational tools that are not intended for consequential decision‑making.

Deployers and Developers

SB 189 applies to both deployers and developers.  A deployer is defined as “a person doing business in Colorado that deploys a covered ADMT.”  While a developer is defined as a person doing business in Colorado who (1) “develops, offers, sells, leases, licenses, or otherwise makes commercially available a covered ADMT,” (2) “develops a component that is designed, marketed, intended, documented, advertised, configured, or contracted to be used as part of a covered ADMT,” or (3) “intentionally and substantially modifies an ADMT such that it becomes a covered ADMT.”  The law creates several exemptions for developers, including ADMTs developed for research or internal development and commercial support functions, so long as the ADMT is not made available to another person for use in a consequential decision.

Consequential Decisions and Covered Domains

SB 189 only governs the use of “covered ADMT” in situations where the technology materially influences a “consequential decision.”  A consequential decision involves determinations affecting a consumer’s access to or eligibility for opportunities in defined “covered domains” including employment, education, housing, financial or lending, insurance, healthcare, and essential government services.  The definition broadly captures decisions that affect a consumer's access to, eligibility for, selection for, or compensation within a covered domain, including decisions that could effectively limit or foreclose that access or opportunity.

Not all automated tools trigger the law’s requirements.  Routine operations such as scheduling, administrative routing, and workflow management are excluded, as are tools that simply summarize or present information for human review without generating a score, ranking, or prediction that influences an outcome.  In welcome news for employers, fraud prevention activities, including identity verification and monitoring controls required by law, are likewise excluded.

The law also adopts a broad definition of “consumer,” which expressly includes Colorado employees and job applicants whose employment opportunities are evaluated through a covered ADMT.

Deployer and Developer Disclosure Obligations

Under the new law, developers will be required to provide deployers with a general statement of the ADMT’s intended uses, known risks and limitations, categories of data used to train the system, and any other information necessary for deployers to meet their disclosure obligations.  In addition to providing notice with regard to material modifications, developers must also maintain records for at least three years.

For employers and other deployers, SB 189 establishes a multi‑stage notice and disclosure process.  Before using covered ADMT for consequential employment decisions (among others), a deployer must provide notice regarding the use of such technology which includes a mechanism for obtaining additional information.

When an adverse outcome (e.g., a decision not to hire) occurs, the deployer must provide additional disclosures within thirty days, including a plain‑language explanation of the decision and the role of the ADMT, instructions for requesting further information about the system and its inputs, and applicable rights including a request for meaningful human review and reconsideration of the decision.  All notices must be accessible to individuals with disabilities and those with limited English proficiency, and deployers must retain relevant records for at least three years.

New Fault-Based Framework for Determining Liability

A notable feature of SB 189 is its framework for apportioning liability.  Both developers and deployers may be held liable under existing anti-discrimination laws with liability allocated based on relative fault.  Developer liability is limited to situations in which the technology was used as intended or marketed.

In addition, any indemnification provisions between a developer and deployer that are used to shield either party from liability under relevant discrimination laws are void as contrary to public policy under the new Colorado law.  This means parties cannot use contract language to shift responsibility for their own violations of the Colorado Anti-Discrimination Act or other Colorado anti-discrimination laws.  However, a developer may avoid this restriction if the covered ADMT was used in a way the developer never intended or documented, provided the developer complied with its obligations under the law.  

Enforcement Rests With the Attorney General

Enforcement authority under the law rests exclusively with the Colorado Attorney General.  The statute does not create a new private right of action but preserves existing legal remedies under other state and federal laws, including anti‑discrimination statutes.

Before initiating enforcement proceedings, the Attorney General must generally provide notice and an opportunity to cure within sixty days, where the Attorney General deems a cure to be possible.  The cure period is not available where the Attorney General finds and can demonstrate that the violation was knowing or repeated.  The opportunity to cure framework sunsets on January 1, 2030.  The Attorney General has broad rulemaking authority and must adopt implementing regulations by January 1, 2027.

Implications for Employers

SB 189 represents a significant change for companies with operations in Colorado.  Covered entities, including employers, should inventory their ADMT and related use cases, assess whether those tools materially influence consequential decisions, and prepare to implement robust notice, disclosure, and documentation processes ahead of the law’s effective date.  Key steps before the January 1, 2027 implementation date include:

• Reviewing and updating vendor contracts to ensure third-party ADMT developers provide required disclosures related to intended use cases, limitations, and training data;
• Auditing current tools to determine whether any qualify as covered ADMTs and whether those tools materially influence consequential decisions affecting employees or applicants;
• Developing pre-use notices and creating workflows to process employee and applicant requests to correct inaccurate personal data;
• Devising post-adverse outcome disclosure notices for all employment-related consequential decisions; 
• Establishing a meaningful human review process staffed by trained individuals with authority to override ADMT-driven outcomes;
• Implementing methods to ensure compliance with record-retention requirements.

Because the Attorney General’s forthcoming rulemaking may materially affect these obligations, employers should treat compliance planning as an iterative process and revisit their programs as additional guidance is issued.

We will continue to monitor SB 189's implementing regulations and related developments across other states as the AI regulatory landscape continues to evolve.  For additional information or questions regarding SB 189 and its implications, please contact the authors of this alert, a member of Seyfarth’s People Analytics team, or any of Seyfarth’s attorneys.

On May 13, 2026, the Institutional Limited Partners Association (ILPA) published guidance regarding organizational expense management and alignment considerations between limited partners (LPs) and general partners (GPs). ILPA’s The Alignment Gap: Rethinking Costs in Private Equity Fund Formation addresses existing market practices in which LPs typically bear organizational costs, while GPs retain discretion over the related processes and service providers.

Background

Organizational expenses -  legal, administrative, and compliance costs incurred during fund formation, have historically been borne by LPs. This allocation has been a longstanding feature of private equity fund structures. ILPA’s guidance cites analysis of private funds indicating that median organizational expense caps increased from roughly 20 basis points in 2019–2021 to approximately 25 basis points by 2024–2025. Meanwhile, private equity has grown into a nearly $10 trillion global asset class, and many of the GPs raising large flagship funds today are among the largest financial platforms in the world.

ILPA contends that the increase in organizational expenses is the result of a simple misalignment: GPs select fund counsel (often the same firm representing the GP itself), set the organizational expense budget, and direct the fund formation process while LPs  bear the cost and may have limited visibility into certain aspects of cost determination and service provider selection.

The ILPA Framework: Three Proposed Elements

ILPA's guidance proposes a three-part framework that institutional investors should be aware of:

1. Cap Organizational Expenses at the Lower of 5 Basis Points or $10 Million
   

   ILPA recommends that LP-borne organizational expenses be capped at the lower of 5 basis points of a fund's target AUM or $10 million in total. The guidance makes clear that side letter negotiations and the MFN process should be explicitly captured within the cap.

   For most small and mid-sized funds, this cap should present no meaningful disruption. For large flagship funds managed by established GPs with standardized documentation and long-term investor relationships, the guidance appropriately questions why formation costs should continue to escalate at all.

2. A 50-50 Cost-Sharing Framework for Expenses Above the Cap
   

   Where formation costs genuinely exceed the proposed cap, ILPA recommends that GPs bear 50% of the overage, with LPs bearing the remaining half. ILPA contends that this approach does not disadvantage new and emerging managers while maintaining a meaningful economic incentive for better-established GPs to manage the process efficiently.

3. Legal Fee Transparency and Budget Discipline
   

   ILPA calls for fund counsel to provide LPs with rate schedules and draft budgets for all formation-related services which as a general matter could be communicated freely, given that institutional investors are already bound by confidentiality agreements. The guidance also recommends that for funds targeting more than $1 billion in AUM, GPs conduct competitive bidding processes when selecting fund counsel to facilitate comparison of service providers and costs.

What This Means for Institutional Investors

ILPA guidance is advisory, but historically ILPA guidance has shaped industry norms and informed LP due diligence and negotiation practice across the market. Institutional investors should consider implementing the following near-term steps:

Reference the framework in negotiations. LPs may reference the framework when discussing organizational expense budgets, requesting legal fee transparency, or seeking cost-sharing provisions in limited partnership agreements.

Scrutinize MFN  and side letter cost treatment. The recent trend of carving  the MFN election process and, to a lesser extent, side letter negotiations, out of organizational expense caps and treating them as uncapped partnership expenses is addressed in the guidance. LPs may evaluate whether, and ensure, LPAs reflect the ILPA position that these types of expenses are squarely within the universe of organizational expenses.

Request legal rate schedules and budgets upfront. The guidance encourages disclosure of such information. Investors should make these requests a routine part of the subscription and diligence process.

Flag competitive counsel selection for larger funds. For commitments to funds targeting over $1 billion, LPs may wish to inquire whether a competitive RFP process was conducted for fund counsel — and note its absence where relevant.

Engage your legal counsel on LPA language. As this guidance gains traction, we expect to see increased negotiation around organizational expense cap provisions, cost-sharing mechanics, and transparency requirements. Institutional investors should ensure that any new commitments — and side letter requests — address these issues explicitly.

Looking Ahead

Private equity negotiations can be contentious, with institutional capital allocators managing the tension between access to top tier managers vs. fee drags that could impact returns. ILPA’s guidance reflects evolving market perspectives on organizational expenses and may inform future negotiations between GPs and LPs. Institutional investors that engage proactively with these issues now will be better positioned to protect their interests across future fund cycles.

Not all negotiations can be treated identically, and ILPA’s guidance should be tempered by other bargaining dynamics such as fund size, commitment amount, platform maturity, etc. 

Bloomberg Law quoted Dawn Solowey, co-lead of Seyfarth's Cultural Flashpoints Task Force, in its article, “DOJ Chills Chances That Justices Weigh Worker Vaccine Mandates.” The piece, published on May 22, 2026, examines the US Justice Department’s position discouraging Supreme Court review of challenges to now‑repealed state vaccine mandates and the broader implications for religious accommodations under Title VII.

In view of this, on 16 April 2026, Seyfarth Shaw’s private wealth practice group hosted a focused seminar in Shanghai, in collaboration with the Hawaii Tax Institute, on the importance of estate planning.  The event took place at The Langham Hotel, Xintiandi, Shanghai and brought together more than 30 high-net-worth individuals, family office representatives, local service providers, bankers, and other professionals.

The seminar welcomed participants and speakers from Hong Kong (Ms. Ann Cooley and Mr. Jonathan Bok), the USA (Mr. Kurt Kawafuchi), and Shanghai (Ms. Yvonne Wang and Ms. Tina Geng), creating a rich, multinational dialogue on the complexities of managing and protecting wealth across borders, together with Seyfarth’s private wealth practitioners Wan Li and Karen Lam (Hong Kong) and Alan Yoshitake (Los Angeles).

Key Topics Explored

The speakers delivered practical and timely insights on several critical areas, including:

• Cross-border estate planning – navigating the unique challenges faced by families with assets and connections in multiple jurisdictions.
• Family office collaboration – how family offices can work effectively with advisors to align long-term goals and resolving disputes if arisen.
• The importance of proactive estate planning – why high-net-worth families should act now rather than later to protect their legacy, especially with the implementation of the Common Reporting Standard (CRS) for the sharing of financial information between tax authorities of different countries.
• Dispute prevention and resolution – strategies to minimize and manage family or beneficiary conflicts.
• Private wealth investment considerations – current trends and considerations in structuring and managing investments in a volatile global environment.

The discussions were well-received, with attendees engaging actively and exchanging valuable perspectives throughout the day. The combination of international expertise and local market knowledge made the sessions particularly relevant for those with assets or interests spanning across Asia and the United States.

This event reflects Seyfarth Shaw’s ongoing commitment to supporting clients in the private wealth space with practical, cross-jurisdictional advice. As global tax rules, regulatory requirements, and family dynamics continue to evolve, such forums play an important role in helping families and their advisors stay ahead.

We would like to thank all speakers, our collaborating partners at the Hawaii Tax Institute, and every guest who joined us in Shanghai. We look forward to hosting more opportunities for meaningful dialogue in the future.

Connecticut’s enactment of H.B. 5003 reflects a continuing nationwide trend toward greater pay transparency and enhanced employee protections concerning compensation. While building on the state’s existing statutory framework, the amendments materially expand both the scope and timing of employer disclosure obligations, particularly in the recruiting and hiring context.

These changes are likely to have significant operational implications for employers, particularly those with multistate workforces, as Connecticut’s requirements now more closely align with (and in some respects expand upon) similar laws in jurisdictions such as New York and New Jersey.

Key Provisions of the Amended Pay Transparency Law

The amended statute both reinforces existing restrictions on employer conduct and imposes new affirmative obligations to disclose compensation and benefit information, significantly expanding Connecticut’s existing pay transparency framework.

Restrictions on Employer Conduct

Under existing law, employers may not:

• Restrict employee communications regarding wages, including by prohibiting employees from disclosing or discussing their own wages or the wages of another employee where such information has been voluntarily disclosed;
• Restrict employee inquiries into compensation, including by prohibiting employees from asking about the wages of other employees;
• Require employees to waive rights relating to wage transparency, including by requiring agreements that (i) prohibit disclosure or discussion of wages or (ii) prohibit inquiries into the wages of other employees that have been disclosed voluntarily by such other employee;
• Inquire into or seek an applicant’s wage or salary history, directly or through a third party, unless the applicant voluntarily discloses such information; provided that this restriction does not apply where federal or state law specifically authorizes the disclosure or verification of salary history for employment purposes, and that employers may inquire into an applicant’s compensation structure so long as they do not seek the value of such compensation;
• Take adverse action against employees for engaging in protected wage-related activity, including disclosing, discussing, or inquiring about wages, or otherwise exercising rights under the statute.

H.B. 5003 expands these protections by prohibiting retaliation or discrimination against an applicant or employee for exercising rights under the statute, including by refusing to interview or hire, failing to promote, or terminating employment.

Compensation and Benefits Disclosure Requirements

Connecticut’s existing law required employers to disclose the wage range for a position to an applicant upon the applicant’s request or prior to or at the time an offer of compensation is made, whichever occurred first. H.B. 5003 expands those obligations, requiring employers to disclose in an internal or public job advertisement the wages or wage range for the position and a general description of the benefits to be offered with such position. This expansion to include disclosures in job postings aligns with many other states’ requirements.

In addition to this new requirement, H.B. 5003 expands the existing disclosure requirements for applicants to require disclosure of a general description of benefits to be offered for the position and accelerates the timing of affirmative disclosure to the earliest of the applicant’s request or prior to any discussion of compensation or an offer of compensation. This disclosure is only required if the information has not already been made available to the applicant in an internal or public job advertisement.

H.B. 5003 also enhances the required disclosure for employees. Employers will now be required to disclose a general description of the benefits to be offered for the employee’s position in addition to the wage range for the position. The law defines “benefits” to include “health insurance benefits, retirement benefits, fringe benefits, paid leave and any other compensation other than wages to be offered with a position.” The timing of the disclosure remains unchanged and must occur upon the hiring of the employee, a change in the employee’s position, or the employee’s first request.

Definition of “Wage Range”

The new law slightly changes the definition of “wage range,” now defining it as the range of wages an employer sets in good faith for a position. Existing law defined it as the range of wages an employer anticipates relying on when setting wages. For most employers, this amendment will likely not require an overhaul of the ranges employers were already disclosing. The range may continue to be derived from any applicable pay scale, the range of compensation for comparable positions, the actual wages paid to employees in similar roles, or the employer’s budgeted amount for the position.

Scope

This amendment clarifies that the law applies to positions performed in Connecticut, as well as positions performed outside the state that report directly to a Connecticut-based supervisor or worksite. This clarification builds on prior Connecticut Department of Labor (“DOL”) guidance on the existing law. In that prior guidance, the DOL had advised that the Act applies to employers within the state using the services of one or more employees for pay even if such employees are located outside the physical confines of the state. The guidance also stated that the Act would not apply to an out-of-state “national” employer not located within the State of Connecticut, but would apply to any subsidiary of the “national” employer located within the physical confines of the state and hiring employees. The amendment now makes clear that for employers with locations nationwide, including in Connecticut, postings for remote positions outside of Connecticut will only be subject to the disclosure requirements if the position would report directly to a Connecticut-based supervisor or worksite. The Illinois and New York pay transparency laws include similar limitations on the reach of those laws.

Enforcement

Employees and applicants may bring a private cause of action for violations, with available remedies including compensatory damages, attorneys’ fees, and other legal or equitable relief. The amendment provides a small reprieve for employers in no longer allowing punitive damages to be awarded for a violation. Claims must be brought within two years of the alleged violation.

Key Takeaways for Employers

With an effective date of October 1, 2026, employers should begin preparing now for compliance. Employers should consider:

• Updating job posting templates to include wage ranges and benefits descriptions;
• Ensuring compensation ranges are documented and supportable as good faith ranges;
• Revising recruiting and employment processes to ensure timely disclosure to applicants and employees;
• Training Human Resources personnel and managers on expanded restrictions and anti-retaliation rules; and
• Coordinating compliance across jurisdictions for multistate workforces.

• On May 20, 2026, Virginia Governor Abigail Spanberger signed into law a new statewide paid sick leave mandate (HB 5 / SB 199) that will bring paid sick leave obligations to virtually all employers in the state in the coming years.
• The new paid sick leave requirements go into effect on July 1, 2027 for employers with at least 50 employees, and then will be introduced in phases over the next 18 months. On January 1, 2029, all employers with at least one employee will be covered by the mandate.
• The newly enacted mandate reflects a significant expansion of the state’s existing paid sick leave law, which went into effect on July 1, 2021, and covers only certain home health workers in the state. The new mandate includes a broad definition of employee, as outlined below.
• Highlights of the new Virginia paid sick leave law’s substantive components include accrual at a rate of one hour of paid sick leave for every 30 hours worked, 40-hour annual caps on accrual and usage, no apparent cap on year-end carryover, a permissible frontloading alternative, a broad “family member” definition, and a requirement that paid sick leave be compensated at the regular rate.

Background:

On March 13, 2026, the Virginia legislature passed HB 5 / SB 199, which would expand the state’s paid sick leave law in a variety of ways, including, by 2029, to cover all private employers. On April 13, 2026, Governor Spanberger recommended amendments to the legislation that would have revised certain definitions, tightened employee notice and use requirements, shortened the statute of limitations, and narrowed remedies. On April 22, 2026, the legislature reconvened for one day, but it did not adopt the governor’s proposed amendments. This triggered a 30-day clock for the governor to take action on the legislation in its original form, which the governor did by signing the legislation on May 20, 2026. The new paid sick leave mandate goes into effect in phases, beginning on July 1, 2027.

Virginia is now the 21^ststate to have enacted a statewide general paid sick leave or paid time off mandate.[1] As noted above, Virginia’s first statewide paid sick leave law went into effect in mid-2021, albeit with a limited impact due to it only applying to certain home health workers in the state.

Summary of Substantive Requirements:

Virginia’s new paid sick leave mandate contains a number of substantive, technical components. Nonexclusive highlights include –

Employer Coverage: The law applies broadly to employers in the state, specifically covering “an individual, partnership, association, corporation, legal representative, receiver, trustee, or trustee in bankruptcy doing business in or operating within this Commonwealth who employs another to work for wages, salaries, or on commission.”

As noted above, the law will go into effect in phases, as follows:

• July 1, 2027: Employers with at least 50 employees.[2]
• January 1, 2028: Employers with at least 25 employees.
• January 1, 2029: Employers with at least one employee.

Employee Eligibility: The law has a broad employee definition, specifically covering “any person who, in consideration of wages, salaries, or commissions, may be permitted, required, or directed by any employer to engage in any employment directly or indirectly.” Importantly, the definition of “employee” excludes individuals covered by the state’s existing home health worker paid sick leave mandate.[3]

Accrual: Paid sick leave under the law must accrue at a rate of at least one hour for every 30 hours worked, up to 40 hours per year.[4] Accrual for new hires must begin at the start of their employment. Accrual for exempt employees can be based on an assumed 40-hour workweek, unless the employee’s normal workweek is less than 40 hours.

The law expressly notes that airline flight crew employees are assumed to work 40 hours per week for purposes of paid sick leave accrual.

Annual Usage and Year-End Carryover: The law does not appear to allow employers to set any cap on the amount of earned, unused paid sick leave that carries over at year-end. However, regardless of carryover amounts, the law expressly states that employers can establish a 40-hour paid sick leave annual usage cap.

Frontloading: Employers that provide a 40-hour upfront grant of paid sick leave to employees at the start of the benefit year can avoid the law’s accrual and year-end carryover obligations.

Reasons for Use: Employees may use available paid sick leave for the following:

• The employee’s own illness, injury, or health condition, including preventive care;
• Caring for a covered family member with an illness, injury, or health condition, including preventive care; and
• Certain absences due to employee or their covered family member’s status as a victim of domestic violence, sexual assault, or stalking.

Family Member: The law contains a broad definition of covered family member. In particular, this definition includes an employee’s (1) child (regardless of age), (2) parent (of the employee or their spouse), (3) spouse or domestic partner, and (4) grandparent, grandchild, or sibling (of the employee or their spouse or domestic partner). In addition, the definition includes (5) an individual for whom an employee is responsible for providing or arranging health or safety-related care, including helping that individual obtain diagnostic, preventive, routine, or therapeutic health treatment or ensuring the person is safe following domestic violence, sexual assault, or stalking; and (6) any other individual related by blood or affinity whose close association with an employee is the equivalent of a family relationship.

Increments of Use: Employees can use available paid sick leave in hourly increments.

New Hire Usage Waiting Period: No express provision, although the statute suggests no such waiting period is permitted. We expect further guidance in forthcoming regulations.

Employee Notice to the Employer: Employers must provide paid sick leave upon employee request, which can be made orally, in writing, via electronic means, or by any other means approved by the employer. If the employee’s need for paid sick leave is foreseeable, the employer can require the employee to make a good faith effort to provide notice of the need in advance of the absence. Employers requiring employee notice of a needed paid sick leave absence must provide employees with a written policy that outlines applicable procedures.

Documentation: The law allows employers to require that employees submit reasonable documentation supporting proper paid sick leave use when the employee is absent for three or more consecutive workdays.

Rate of Pay: The law states that paid sick leave must be compensated at the “regular rate” as set forth under Virginia law. The rate of pay cannot be less than the applicable minimum wage.

Separation of Employment: Employers are not required to cash out earned, unused sick leave upon employment separation. Employers must reinstate earned, unused paid sick leave to any employees who are separated from employment and then rehired within 12 months of separation. Further, employers must allow such employees to use accrued paid sick leave and accrue additional paid sick leave immediately upon resuming their employment.

Non-Sick Paid Time Off Policies: Employers can use a paid leave policy, such as PTO, vacation time, personal time, etc., to comply with the Virginia paid sick leave law if certain criteria are met. These include providing a sufficient amount of paid leave that meets the law’s requirements and that can be used for the same purposes and under the same conditions as statutory paid sick leave.

Collective Bargaining Agreements (CBA):

• General: An employer does not need to provide additional paid sick leave to employees covered by a CBA if the CBA requires the employer to (1) provide a sufficient amount of paid leave as called for by the Virginia law and (2) allow employees to use that paid leave for the same purposes and under the same conditions as statutory paid sick leave.
• Longshore and Harbor Workers’ Compensation Act: The law contains a separate exemption for employees covered by this Act as long as certain conditions are met. The conditions include, among other criteria, that the employer is a party to an existing CBA that is in effect on July 1, 2027.

Notice and Posting / Recordkeeping: The new law explicitly calls out that these topics will be addressed in forthcoming paid sick leave regulations. The law sets a July 1, 2027 deadline for the Virginia Department of Labor and Industry to issue regulations.

Enforcement: Employees can file a complaint with the Virginia Department of Labor and Industry within one year of the alleged violation. No civil monetary penalty will be assessed, and no action will be brought against an employer alleged to have violated the Virginia paid sick leave law if the employer corrects the alleged violation within a reasonable time to be established by regulation. Employees who believe their paid sick leave rights have been violated can file a private right of action against the employer without first filing an administrative complaint.

Next Steps:

As Virginia’s expanded paid sick leave requirements are now law, employers should begin compliance preparations in advance of the law’s various effective dates, depending on employer size. Here are some next steps for employers to consider:

• Assess which of the Virginia paid sick leave mandate’s effective dates – July 1, 2027, January 1, 2028, and January 1, 2029 – apply to the employer.
• Review existing sick leave or PTO policies and practices, and either implement new policies and practices or revise existing policies and practices to ensure compliance with the Virginia paid sick leave law while doing the same for any related attendance, conduct, anti-retaliation, and discipline policies and practices.
• Train supervisory and managerial employees, as well as HR, on the new requirements.
• Monitor the Virginia Department of Labor and Industry’s website for the release of administrative guidance, such as a model notice and FAQs, and rulemaking on employers’ paid sick leave compliance obligations.

With the paid leave landscape continuing to expand and grow in complexity, companies should reach out to their favorite Seyfarth attorney for solutions and recommendations on addressing compliance with nationwide paid leave requirements. To stay up-to-date on paid leave developments in Virginia and beyond, click here to sign up for Seyfarth’s Paid Sick Leave mailing list. Companies interested in Seyfarth’s paid sick leave laws survey should reach out to paidleave@seyfarth.com.

[1] Today, the states that have enacted a statewide general paid sick leave or paid time off mandate include: (1) Alaska (effective 7/1/2025), (2) Arizona; (3) California; (4) Colorado; (5) Connecticut; (6) Illinois (PTO law); (7) Maine (PTO law); (8) Maryland; (9) Massachusetts; (10) Michigan; (11) Minnesota; (12) Nebraska (effective 10/1/2025); (13) Nevada (PTO law); (14) New Jersey; (15) New Mexico; (16) New York; (17) Oregon; (18) Rhode Island; (19) Vermont; (20) Virginia; and (21) Washington. There also is a paid sick leave mandate in (22) Washington, D.C.. Further, there are more than two dozen municipalities with paid sick leave or paid time off mandates in the United States.

[2] It is unclear at this time whether the employee thresholds tied to the phased-in effective dates only count employees who work in Virginia or an employer’s entire United States workforce. We expect this topic to be addressed in subsequent rulemaking and administrative guidance.

[3] The Virginia home health worker paid sick leave law defines employee as “a home health worker who works on average at least 20 hours per week or 90 hours per month.”

[4] The law defines "year" as a regular and consecutive 12-month period determined by the employer.

Here are the 7 outlier personality traits that characterize lawyers, according to Dr. Richard's research:

•    Much higher level of skepticism than the general public
•    Much higher need for autonomy
•    Higher level of abstract reasoning—lawyers like using their intellect to solve problems, but also like to argue
•    Higher level of urgency—lawyers want closure, are impatient
•    Lower level of empathy—less inclined to take the perspective of others
•    Lower level of sociability—i.e., not very comfortable with emotional vulnerability, very private, guarded about personal issues
•    And, the most important one—lawyers are dramatically and pervasively low in resilience (i.e., 20% lower average resilience score than the general public, and 90% of lawyers have a resilience score in the bottom half of the scale! That makes us thin-skinned, insecure, defensive, and easily wounded.)

Dr. Richard and his wife, D'Arcy Lyness, PhD, also a psychologist, have just written a book entitled Thin-Skinned: Why Lawyers Are So Low in Resilience, and the New Science That Can Help. It will be published by the American Bar Association in July of 2026. The book explains why lawyers are so consistently low in resilience, and then offers over 50 different scientifically supported self-help practices that can help lawyers build resilience, manage stress, and improve overall well-being.

Join us on this episode today to explore why lawyers, according to Dr. Richard, are among the least resilient professionals in the workplace. We talk about how the deeply ingrained skepticism of attorneys is colliding with the unprecedented pace of change brought on by AI and a rapidly evolving legal landscape.

Read the full transcript of today's episode here.

Related Links

Dr. Larry Richard on LinkedIn

LawyerBrain Website

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As workplaces become increasingly shaped by complex social, political, and cultural dynamics, employers are facing a rising number of investigations tied Flashpoint issues. In this episode, host Sam Schwartz-Fenwick sits down with Ann Marie Zaletel to unpack what distinguishes these investigations from traditional workplace matters - from heightened legal risk and public scrutiny to the intense emotions and reputational stakes involved.

Drawing on real-world experience, Sam and Ann Marie explore why these matters are more likely to escalate into high-profile disputes and how the investigative process itself can influence outcomes. This conversation underscores why a thoughtful, nuanced approach is essential - not only to mitigate risk, but to maintain trust, workplace stability, and organizational integrity in a polarized environment.

In a feature interview with IEL, Tullberg reflects on her passion for employment law and its evolving role in today’s workplace, noting:

“I value its position at the forefront of legislative reform and political debate, as well as the unique way it sits at the intersection of advisory, transactional, and litigious practice.”

She emphasizes the importance of collaboration as employers navigate rapid change, adding:

“With so much in motion, it’s essential that private practice and in‑house teams are aligned and working as one.”

Read the full profile here.

This post addresses a broader question: What does the IFR mean for current and out-to-bid DOT projects operating under pre-existing DBE goals? The answer is that the IFR did more than change who qualifies as a DBE. It also changed how federally funded transportation and airport projects must be handled during the re-evaluation period. This affects active contracts, pending procurements, airport projects, design-build teams, and anyone relying on old assumptions about DBE goals and counting of DBE and ACDBE credit.

The IFR changed more than certification

The IFR fundamentally reworked the DBE and ACDBE framework. Specifically, the rule eliminated race- and sex-based presumptions of social and economic disadvantage, required an individualized showing for all applicants, mandated a one-time nationwide reevaluation of existing certifications, and suspended contract goals and the counting of DBE and ACDBE participation toward those goals until reevaluations are complete.[1]

That combination is what makes the IFR so disruptive in practice. The IFR reaches both eligibility and project administration. It changes how firms prove DBE status, and it changes how DOT funding recipients and contractors handle projects that were awarded, advertised, or moving toward award during the transition.

The eligibility standard has been narrowed

Eligibility to be certified as a DBE based on sex or race has been the standard since the DBE program’s inception in 1983 under President Ronald Reagan. Before the IFR, applicants could rely on regulatory presumptions tied to race or sex. For example, applicants who were women or members of certain racial or ethnic groups could qualify based on a rebuttable presumption of social and economic disadvantage rather than an individualized showing.[2] That framework is gone.

Under the IFR, those presumptions have been eliminated, and each applicant must now establish social and economic disadvantage through a case-by-case showing supported by a Personal Narrative, a current Personal Net Worth Statement, and any other financial documentation the owner considers relevant.[3] The applicant must identify specific hardships, systemic barriers, or denied opportunities and explain how those circumstances caused economic harm, including the type and magnitude of the harm.[4]

The IFR does not reduce “denied opportunities” or “economic harm” to a rigid checklist. But DOT’s guidance indicates that certifiers are expected to evaluate the evidence holistically, including potentially relevant considerations relating to education, employment, and business history.[5]

For contractors, the point is simple: reevaluation is not a ministerial renewal exercise. It takes time, documentation, and individualized proof. That reality helps explain why the IFR immediately affected not just certification, but also the administration of active and pending federally funded projects.

The goal-setting freeze is what changes project administration

The IFR’s project-level impact flows from one core point: DOT has suspended contract goal setting and the counting of participation toward goals until reevaluation is complete.  Thus, during the reevaluation period, DBE and ACDBE goals cannot be set or counted the way they were before.[6]

That means contractors are not just dealing with a new certification standard. They are dealing with a temporary change in how federally funded DOT and airport work is procured and administered.  That is why the IFR has created so much confusion for contractors.

Current contracts generally stay in place, but DBE goals are paused

The IFR does not require modification of contracts executed before October 3, 2025. However, DBE participation on those contracts may not be counted toward the contract goal or the recipient’s overall goal until the relevant Unified Certification Program (UCP) completes reevaluation.[7]

That is an important distinction. Existing contracts may remain in place, even while the goal-credit mechanics are effectively frozen, though several important obligations and protections, including prompt-payment requirements, continue during this period. However, similar issues can arise for contracts executed after October 3, 2025 during the reevaluation period, because goal setting and counting remain suspended under the IFR. Prime contractors may not terminate a DBE or reduce its scope without prior written consent from the recipient and a showing of good cause. And the IFR does not itself disturb existing joint venture or subcontracting agreements.[8] Thus, the key question is not simply the date of contract execution, but whether the contract was awarded or is being performed while goal setting and counting remain suspended under the IFR.

So the better way to think about existing contracts is this: the IFR paused counting, not contract administration as a whole.

Advertised but not yet bid projects need to be updated

The IFR has a more immediate effect on projects still moving through the solicitation process.

If a contract has been advertised but bids had not yet opened, the DOT funding recipient (often a state or local transportation agency) must amend the advertisement to remove the DBE contract goal.[9]

The takeaway is straightforward: do not assume the DBE goal in an earlier version of the solicitation is still operative. Check the latest amendment package, addenda, and bid instructions. On a live pursuit, older goal language may no longer reflect the project’s actual compliance posture, which can affect pricing, staffing, team composition, and proposal strategy. A contractor working from stale solicitation assumptions may be solving for a compliance requirement that no longer exists in the same form.

Projects with bids opened but no award yet face a different problem

The next category is projects where bids have opened, but award has not yet been made.

In that scenario, DOT funding recipients must zero out the DBE goal before contract award—that is, they must treat the contract as having no DBE goal for purposes of award. DOT also indicated that recipients may amend those procurements without readvertising, although each recipient still must assess whether state law requires a different course.[10]

This is where the IFR becomes especially project-specific. Federal guidance may permit a path forward, but that does not eliminate state procurement rules, local bidding requirements, or protest risk. For contractors, that means two things. First, bids may have been prepared under assumptions that no longer hold. Second, the owner’s chosen fix may itself become a source of dispute if state law points in another direction.

Design-build and airport projects deserve special attention

The IFR is not limited to traditional infrastructure projects or traditional delivery methods. 

For design-build projects, if DBE subcontracts were signed before October 3, 2025, those agreements may proceed, and the DBE firms may not be terminated except under the same consent-and-good-cause rule that applies more generally.[11]

That matters because design-build teams often lock in critical relationships earlier than in design-bid-build projects and may be more sensitive to changes in scope, trade allocation, and pursuit structure.

Airport projects also sit squarely within the IFR’s reach. The rule applies to both DBE and ACDBE programs, which means federally funded airport work faces the same transition issues: reevaluation, suspended goals, and uncertainty about when ordinary counting and program administration will resume.[12]

The IFR did not erase every existing obligation

Because the IFR has been so disruptive, it is worth being clear about what it did not do. To summarize:

The IFR did not automatically require modification of every contract executed before October 3, 2025.

The IFR did not automatically unwind existing subcontracts or joint ventures.

The IFR did not eliminate prompt-payment obligations.

The IFR did not eliminate termination protections for DBE subcontractors.

And the IFR did not eliminate the need to evaluate state-law procurement requirements before deciding whether amendment without readvertising is enough.[13]

That is an important practical check. The IFR disrupted the old DBE framework, but it did not create a blank slate.

At the same time, contractors should not assume the current suspension of DBE goals will remain static. The present regime is transitional and still subject to reevaluation, recertification, and project-specific implementation decisions. General contractors should continue monitoring these developments closely, because the volatility and uncertainty of the current goal-suspension framework can still affect bidding, contract administration, and project closeout.[14]

What contractors and owners should be doing now

The best response to the IFR is not broad theorizing. It is project sorting.

For current contracts, confirm that project teams understand the difference between keeping the contract in place and counting participation toward goals.

For active procurements, verify whether DBE goals have been removed or zeroed out through amendments, addenda, or award documents.

For design-build teams and airport projects, review subcontract structures and existing commitments carefully before making changes based on assumptions about the IFR.

For owners and recipients, do not stop at the federal guidance. Check the applicable state-law procurement overlay before deciding how to revise or award a project.

And for all participants, avoid assuming that prior certification status or directory listings still answer the operational questions that matter most during reevaluation. The transition is already creating uncertainty, delay, and administrative burden while jurisdictions work through the reevaluation process.[15]

The bigger takeaway

The IFR is not a one-time certification development. It is an ongoing project-delivery issue.

That is why California was a useful place to start in our first post. California’s April 16 reevaluation deadline gives the transition a concrete timetable. But the broader lesson is national: contractors should expect the IFR to affect live projects and pending procurements differently depending on where a contract sits in the pipeline.

Conclusion

The IFR did not just change who qualifies as a DBE or ACDBE. It changed how federally funded DOT and airport projects must be handled while reevaluation is underway.

For current contracts, that means existing agreements may continue even while counting is paused and key protections remain in place. For projects still in the bid pipeline, it means recipients and contractors need to pay close attention to whether goals have been removed, zeroed out, or otherwise revised to reflect the new framework. And for everyone involved, it means old assumptions about DBE administration are no longer enough.

The IFR has not erased DBE issues from federally funded transportation work. It has made them more procedural, more project-specific, and, for many contract

[1]             Disadvantaged Business Enterprise Program and Disadvantaged Business Enterprise in Airport Concessions Program Implementation Modifications, 90 Fed. Reg. 47,969, 47,971–73 (Oct. 3, 2025) (codified at 49 C.F.R. §§ 26.51(h), 26.55(i), 26.67(a), 26.111); see also Alexandra G. Farone & Janet K. Meub, Prove It: Department of Transportation’s DBE Program Ceases Presumption of Disadvantaged Status for Women- and Minority-Owned Businesses, Nat’l L. Rev. (Oct. 14, 2025).

[2]             See, e.g., 13 C.F.R. § 124.103(b)(1) (2025).

[3]             Disadvantaged Business Enterprise Program and Disadvantaged Business Enterprise in Airport Concessions Program Implementation Modifications, Note 1, supra, at 47,982 (codified at 49 C.F.R. § 26.67(a)(1)–(3)).

[4]             Ibid.

[5]             Official Frequently Asked Questions (FAQs) on the U.S. Department of Transportation’s Disadvantaged Business Enterprise Program and Disadvantaged Business Enterprise in Airport Concessions Program Implementation Modifications, October 3, 2025, Interim Final Rule 8–9 (updated Dec. 1, 2025).

[6]             Disadvantaged Business Enterprise Program and Disadvantaged Business Enterprise in Airport Concessions Program Implementation Modifications, Note 1, supra, at 47,972–74, 47,982 (codified at 49 C.F.R. §§ 23.25(h), 23.53(g), 23.55(m), 26.47(e), 26.51(h), 26.55(i), 26.111); see also Official Frequently Asked Questions (FAQs), Note 5, supra, at 2, 10-11.

[7]             Official Frequently Asked Questions (FAQs), Note 5, supra, at 2-3; see also Disadvantaged Business Enterprise Program and Disadvantaged Business Enterprise in Airport Concessions Program Implementation Modifications, Note 1, supra, at 47,973, 47,982 (codified at 49 C.F.R. §§ 26.55(i), 26.111).

[8]             Official Frequently Asked Questions (FAQs), Note 5, supra, at 3-5.

[9]             Id. at 5; see also Office of the Secretary, U.S. Dep’t of Transp., DBE IFR Guidance 3–4 (Oct. 3, 2025).

[10]            Official Frequently Asked Questions (FAQs), Note 5, supra, at 2–3 (updated Dec. 1, 2025); see also Office of the Secretary, U.S. Dep’t of Transp., DBE IFR Guidance 4 (Oct. 3, 2025).

[11]            Official Frequently Asked Questions (FAQs), Note 5, supra, at 3-4.

[12]            Disadvantaged Business Enterprise Program and Disadvantaged Business Enterprise in Airport Concessions Program Implementation Modifications, Note 1, supra, at 47,973–74, 47,977–79 (codified at 49 C.F.R. pt. 23);; see also Official Frequently Asked Questions (FAQs), Note 5, supra.

[13]            Official Frequently Asked Questions (FAQs), Note 5, supra., at 2-5.

[14]            Id. at 2, 6–10; see also Virginia Trunkes, Navigating the DOT’s Interim Final Rule on DBE Certification Standards – and Preparing for the (Bumpy) Road Ahead, Nat’l L. Rev. (Oct. 7, 2025).

[15]            Official Frequently Asked Questions (FAQs), Note 5, supra, at 6-9.

This guide breaks down challenges marketers face today and the practical steps leading brands are taking to use AI confidently and responsibly.

How AI Is Being Used in Marketing Today

Marketers increasingly rely on AI to:

• Generate copy, images, videos, and campaign concepts
• Personalize customer experiences using real‑time data
• Speed up design and production cycles
• Support creative ideation and experimentation

While AI has proven valuable in supporting the creative process, it is not without its pitfalls as some early AI-driven campaigns have received negative reactions, including luxury brands being called out for visuals that felt “tacky” or off‑brand, and AI-powered campaigns facing criticism for lacking originality. These examples highlight a core truth: AI must enhance a brand’s identity, not compromise it.

Key Issues AI Presents for Marketing Teams

1. Creative Ownership & Copyright Ambiguity

Because many AI systems are trained on massive datasets that may include copyrighted creative work, outputs can unintentionally resemble existing designs, art, or media.
For marketers, that creates uncertainty around:

• Who owns AI-generated content
• Whether outputs risk mimicking protected material
• Potential IP disputes with copyright owners

How smart marketing teams protect themselves

• Asking AI vendors to explain their training data sources
• Including clear IP and indemnification language in contracts with AI vendors and partners
• Human review of AI outputs for recognizable third‑party material before publishing

2. Data Privacy & Targeting Risks

AI-powered marketing often uses historical customer behavior, segmentation, and predictive profiling, all of which practices may trigger privacy laws, such as GDPR, the California Consumer Privacy Act (CCPA), and industry-specific regulations in areas such as healthcare and finance.

How brands reduce privacy risks

• Running privacy and data‑protection assessments before adopting new AI tools
• Ensuring they have a lawful basis for targeted advertising and profiling
• Minimizing data collection to limit exposure
• Keeping sensitive data inside secure or private AI environments
• Tracking who accesses customer data to support compliance audits

All of these steps should be taken in concert with the brand’s legal team to ensure compliance with all applicable laws.

3. Deepfakes, Fabricated Content & Brand Harm

AI can generate realistic images, videos, and audio that look like real people—or real brands. Without proper guardrails, this can lead to:

• Impersonation
• False endorsement
• Right‑of‑publicity concerns
• Reputational damage

How marketers stay safe

• Prohibiting the use of real individuals or their likeness in any form in AI-generated content without explicit permission
• Implementing content-review workflows before campaigns go live
• Training staff on how to spot defamation, impersonation, and other reputational risks

4. Bias, Manipulation & Consumer Trust

AI models can unintentionally reinforce stereotype-driven patterns or produce unfair targeting decisions. This exposes brands to consumer-trust issues and potential regulatory scrutiny.

How companies ensure fairness

• Building internal AI‑governance and review frameworks
• Testing their tools for biased outputs
• Making disclosures clear and giving customers easy ways to report issues

Operational Challenges Marketers Are Reporting

AI is not just a legal or ethical concern—there are day‑to‑day reliability issues that can disrupt campaign performance.

Common AI “hallucinations”

• Made-up statistics
• Inaccurate compliance statements
• Incorrect product claims
• Fake testimonials

Teams also report issues with adversarial prompts (“jailbreaks”) where AI tools behave unpredictably or produce unsafe content.

The impact on marketing operations

• 40% of marketers had to pause or pull campaigns
• One‑third experienced brand or PR setbacks
• Many cited wasted budgets, client dissatisfaction, and legal delays

Stronger AI Practices Leading Marketers Are Adopting

• Use of AI content‑screening tools: Checking for potential copyright similarities before publishing
• Documentation: Keeping records of human involvement and editorial review
• AI usage policies: Defining approved tools, review steps, and escalation paths for legal or compliance review

Bottom Line

AI is reshaping marketing faster than any previous technology shift, but major questions around copyright, data usage, and content authenticity are still unfolding in the courts. The marketers who succeed won’t be the ones moving the fastest, but rather those adopting AI with purpose, strategy, and smart safeguards.

Lurie emphasized how systemic issues in electronic compliance programs can quickly escalate penalties, noting:

“Electronic I‑9 violations are an easy enforcement win: one systemic deficiency like a bad audit trail can sweep in hundreds, or thousands, of records at once. That’s a faster path to a large fine than picking apart individual forms.”

Tyman emphasized that, while the reports are limited, their elimination could have broader consequences beyond enforcement, noting:

“Since the information reports provided is so high level and done in an aggregate form, its elimination won't have direct impact on EEOC enforcement. The bigger impact will be on EEOC outreach, by eliminating a form of data some employers used as a benchmark to see how they stack up relative to their industry.”

The full article is available here.

The article emphasizes that effective AI training is less about mastering specific tools and more about cultivating a mindset that will remain relevant as technology evolves. Ersin outlines seven practical guideposts—from embedding ethics and governance to teaching AI through real legal workflows—that help firms create scalable, future‑ready programs for junior talent.

As Ersin explains:

“Artificial intelligence training for summer associates isn’t really about AI: It’s about teaching a way of thinking that will still be relevant when the tools change — which they will and already have.”

She also underscores the importance of judgment and human oversight, noting:

If a summer associate leaves training thinking 'AI is a shortcut,' or 'AI is going to replace me,' you've missed the mark. If they leave thinking 'AI is one, of many, supplemental tools in a broader problem-solving tool kit, and I'm responsible for judgment, verification and outcomes,' then you've taught a professional skill set that will scale with their career."

The full article is available here.

Tuesday, May 19, 2026
3:00 p.m. to 4:00 p.m. Eastern
2:00 p.m. to 3:00 p.m. Central
1:00 p.m. to 2:00 p.m. Mountain
12:00 p.m. to 1:00 p.m. Pacific

About the Program

Recent developments in background screening, fair hiring laws, and the use of artificial intelligence in employment decisions continue to create significant compliance challenges for employers nationwide. Expanding Fair Credit Reporting Act (FCRA) theories, increased regulatory scrutiny, and evolving state and local fair chance requirements are reshaping risk assessments and hiring practices.

In this timely program, our speakers will discuss key legal and regulatory updates affecting pre-employment background checks and fair hiring compliance, with a particular focus on emerging litigation and compliance trends and the growing role of AI-driven tools.

Attendees will gain practical insights into how these developments may impact hiring strategies, vendor relationships, and compliance programs in the months ahead.

Topics include:

• Expansion of FCRA claims and recent class action trends involving background screening and AI based hiring tools
• California fair hiring developments, including proposed amendments, agency guidance, and an expanded definition of “employer”
• Federal, state, and local legal updates, including proposed changes to the FCRA and developments in Washington, Philadelphia, and New York
• Being positioned for success in front of courts and regulators 

Speakers

Pamela Devata, Partner, Seyfarth Shaw LLP
Jennifer Mora, Partner, Seyfarth Shaw LLP

Learn more about our Background Checking & Drug Testing practice.

If you have any questions, please contact Kate Stacey at kstacey@seyfarth.com and reference this event.

To comply with State CLE Requirements, CLE forms requesting credit in IL or CA must be received before the end of the month in which the program took place. Credit will not be issued for forms received after such date. For all other jurisdictions forms must be submitted within 10 business days of the program taking place or we will not be able to process the request.

Our live programming is accredited for CLE in CA, IL, and NY (for both newly admitted and experienced).  Credit will be applied as requested, but cannot be guaranteed for TX, NJ, GA, NC and WA. The following jurisdictions may accept reciprocal credit with our accredited states, and individuals can use the certificate they receive to gain CLE credit therein: AZ, AR, CT, HI and ME. For all other jurisdictions, a general certificate of attendance and the necessary materials will be issued that can be used for self-application. CLE decisions are made by each local board, and can take up to 12 weeks to process. If you have questions about jurisdictions, please email CLE@seyfarth.com.

Please note that programming under 60 minutes of CLE content is not eligible for credit in GA. programs that are not open to the public are not eligible for credit in NC.

When Colorado enacted the first comprehensive state AI law in 2024, it imported the conceptual architecture of the EU AI Act: a risk-based regime built on duties of care, risk management programs, and impact assessments. Two years later, and within a matter of weeks, the state has dismantled that legislation. On May 14, 2026, Governor Jared Polis signed Senate Bill 26-189, which repeals SB 24-205 and replaces it with a disclosure-and-rights framework focused on automated decision-making technology (“ADMT”). The new framework takes effect January 1, 2027.

The substance of the rewrite has been well-covered already. Less examined is how Colorado got here, and what the speed and direction of the pivot signal for the rest of the state AI regulatory landscape. The new bill was introduced and signed within two weeks of its introduction. The Governor’s AI Policy Working Group did the heavy lift in advance: roughly six months of stakeholder consultation produced the draft framework released on March 17, 2026. But the final two-week sprint reflects pressure to land the rewrite before the original AI Act’s June 30, 2026 effective date and amid escalating federal headwinds.

The Federal Backdrop

On December 11, 2025, the White House issued an executive order (“EO”) titled, “Ensuring a National Policy Framework for Artificial Intelligence.” The EO directs federal agencies to challenge conflicting state AI laws through litigation and coordinated federal action, and urges development of a preemptive national framework. It specifically named Colorado’s AI Act as an example of a state law that, in the administration’s view, would compel AI systems to “produce false results in order to avoid a ‘differential treatment or impact’ on protected groups.”

The EO also created an AI Litigation Task Force with responsibility for challenging state AI laws in federal court on Commerce Clause, preemption, and other constitutional grounds. The Task Force was formally established by AG memorandum on January 9, 2026, and its first visible action was the DOJ’s intervention in the xAI litigation against Colorado’s original AI Act, the same statute SB 26-189 now replaces. Subsequent White House and agency actions in early 2026 have continued to develop the federal policy posture, including legislative recommendations urging Congress to adopt a unified, preemption-oriented framework.

The federal government’s involvement in the resulting litigation followed the executive order. xAI’s challenge to the original AI Act argued that the law unconstitutionally compelled AI developers to embed the state’s preferred viewpoints into their products; the U.S. Department of Justice, acting through the AI Litigation Task Force the EO had directed it to create, intervened in support. On April 27, 2026, a federal magistrate judge stayed enforcement of the Colorado AI Act after the Attorney General stipulated to the stay, citing the pending legislative rewrite.

The Colorado amendment effort predates the December EO. Governor Polis publicly invited legislative revisions when he signed SB 24-205 in 2024, and the special session of August 2025 extended the effective date for the same reason. Business pressure and the Governor’s Working Group were the primary drivers of substantive change. But the federal posture and the xAI injunction unmistakably influenced the speed of the final sprint and reinforced the political case for narrowing the statute. The substantive provisions most directly criticized by the EO: the duty to ban algorithmic discrimination; the impact assessment mandate; and the deployer risk management program, all notably align with the provisions SB 26-189 removes.

From Risk Regulation to ADMT Disclosure

The conceptual shift is the more interesting story for practitioners. The original bill seemingly borrowed its framework from the EU AI Act: a tiered, risk-based regulation of “high-risk AI systems” with affirmative duties to avoid algorithmic discrimination, mandatory impact assessments, governance program requirements, and a safe harbor for entities aligned with industry standard risk management frameworks.

That is the case no longer. The new statute governs “covered ADMT” – automated decision-making technology used to “materially influence” a consequential decision. Material influence requires the ADMT output to be a non-insignificant factor that affects the outcome of the decision through ranking, scoring, constraining options, or otherwise meaningfully altering how the decision is made. The statute also expressly excludes “low-stakes or routine” business activities (advertising, content moderation, cybersecurity, fraud prevention, and AML/sanctions compliance) from the definition of consequential decision, and excludes common technologies like calculators, databases, spreadsheets, and tools used solely to summarize or present information for human review from the definition of ADMT itself.

What replaces the risk-management regime is a disclosure-and-rights framework that should look familiar to anyone who has worked with CCPA’s automated decision-making technology regulations:

• Developer documentation obligations. Developers must provide deployers with technical documentation covering intended uses, known harmful uses, training data categories, known limitations, and instructions for appropriate use and human review. Trade secrets and model weights are protected.
• Deployer notice. Clear and conspicuous notice at the point of interaction with a covered ADMT.
• Post-adverse-outcome disclosure. A plain-language description of the ADMT’s role within 30 days of an adverse outcome.
• Consumer rights. Rights to access personal data used by the ADMT, correct factually incorrect data (excluding opinions, predictions, and scores), and request meaningful human review of adverse decisions.
• Recordkeeping. Three-year retention for both developers and deployers.
• Enforcement. Exclusive AG enforcement under the Colorado Consumer Protection Act, with a 60-day right to cure violations.

The original AI Act imposed substantive obligations on AI development and deployment: how the system must be built, tested, and governed. SB 26-189 now imposes procedural obligations around the use of the system: what must be disclosed, who must be notified, which rights consumers can exercise. The center of gravity moves from algorithmic accountability to procedural transparency.

Why the Divergence Matters

For two years, the prevailing assumption among state AI policymakers was that the EU AI Act provided the template. Colorado was the proof of concept. Colorado’s retreat changes that assumption. SB 26-189 was sponsored by the same legislator (Senator Rodriguez) who championed the 2024 original. The state’s pivot is not a partisan rejection of AI regulation; it is a working majority concluding that the EU-aligned model is not the right vehicle (or at least not in the current political climate).

That conclusion has practical consequences for companies with operations in both the US and EU. Colorado now joins California in anchoring a US-state model focused on disclosure, consumer notice, and rights-based remedies enforced through deceptive trade practice statutes. The EU AI Act, even after the provisional political agreement reached on May 7, 2026 to delay application of its high-risk obligations from 2026 to 2027, remains a substantive risk-management regime. That agreement pushes back when the high-risk obligations take effect, but it does not reduce what those obligations require, and as of this writing it is not yet binding law – the European Parliament and the Council of the EU still have to formally adopt it. Multinationals will increasingly need to maintain two compliance postures rather than one harmonized framework.

Practical Takeaways

For in-house counsel and AI governance teams, the rewrite warrants a recalibration of, but not a retreat from, your governance initiatives:

1. Do not dismantle existing AI governance programs. Risk management programs, impact assessments, and alignment with AI Risk Management Frameworks remain valuable across U.S. AI regulations. SB 26-189 removed Colorado’s specific mandate and the associated safe harbor; it did not eliminate the underlying compliance utility.
2. Reassess scope. Companies that were comfortably outside the prior framework may now be in scope for the new one. Two notable omissions from the new framework also warrant attention. First, SB 26-189 eliminates the original AI Act’s exemption for businesses with fewer than 50 full-time employees, potentially bringing smaller organizations into scope. Second, and more significantly, it removes the affirmative duty of reasonable care to avoid algorithmic discrimination, which was the core substantive obligation of the original law. Companies can still face liability for discrimination under existing Colorado anti-discrimination statutes, but the AI-specific duty of care is gone.
3. Audit “materially influence” exposure. The on/off switch for the entire framework is whether an ADMT output materially influences a consequential decision. Mapping current AI tools against the statutory criteria and its express exclusions for “low stakes” business purposes is the first compliance step.
4. Watch AG rulemaking. Colorado’s Attorney General must complete implementing rulemaking by January 1, 2027. Key open questions (such as the contours of “materially influence,” the post-adverse-outcome disclosure mechanics, the standard for meaningful human review) will be resolved through that process.
5. Don’t bank on federal preemption. Federal pressure can reshape the state legislation without displacing it, which is precisely what happened in Colorado. The DOJ AI Litigation Task Force and the White House’s legislative framework are real pressure points, but Congress has repeatedly declined to enact preemptive federal AI legislation, and state AI laws remain in effect pending legislative or judicial action. Compliance teams should assume the state-by-state landscape persists.

The Bigger Picture

Colorado was the bellwether for state AI regulation aligned with the EU model. Its quick about-face, executed with weeks remaining before the original law’s June 30, 2026 effective date and amid active federal pressure on the same statute, is the strongest signal yet that the EU template will not be the dominant US state framework. Whether the replacement model converges nationally or fragments into a patchwork like our existing state-by-state privacy regime remains to be seen.

Employers have been waiting for the EEO-1 Joint Reporting Committee to open its portal and announce a deadline for this year’s filings.  That day may not come.  Then again, it may… at least for one more year. 

On May 14, 2026, the EEOC submitted a proposal to the Office of Information and Regulatory Affairs (“OIRA”) that would rescind the annual EEO-1 reporting requirement. The EEOC also proposed eliminating the EEO-3, EEO-4 and EEO-5 reports, among others (for unions, state and local government, and elementary-secondary school staff).

At this stage, the proposed rule is only that: a proposal.  The text of the proposed rule has not been made publicly available, so the details regarding the EEOC’s rationale are not yet known.  Instead, only a descriptive title signaling the EEOC’s intention has been made public: “Rescission of EEO-1, EEO-2, EEO-3, EEO-4, EEO-5, And Reporting Requirement Under Title VII, the ADA, GINA, and the PWFA.”

The EEOC still needs to go through the rulemaking process outlined by the Administrative Procedure Act (“APA”) before rescission of the reports would be effective.  The rulemaking process has several discrete steps, including approval by OIRA, publication of a proposed rule, and a comment period for the general public, which typically takes months to complete.  The process could also face significant opposition, since some civil rights advocates and former government officials have already weighed in to voice opposition to the report.

The EEOC also faces a pressing deadline.  Current regulations provide that the EEO-1 Report must be completed “[o]n or before September 30 of each year.” 29 CFR 1602.7.  As such, either the Report or its rescission must be completed by that date.  Unless the proposal moves forward on an expedited basis, employers will likely still need to file reports by September 30th covering employment data for 2025.   

This move by the EEOC is consistent with the current Administration’s broader policy direction. Its Chair, Andrea Lucas, has expressed concern about how employers use employee demographic data, noting that race and gender details can be problematic if provided to decisionmakers.  The Federal government has also distanced itself from disparate impact liability, which looks at group-wide data and how neutral policies or practices may affect different populations in their application.  The Administration’s focus has shifted to intentional discrimination against individuals or groups.  As such, the EEOC’s proposal to discontinue collecting highly aggregated race and gender data that is typically used only for industry and trend analyses fits within the Administration’s broader policy agenda.

What does this mean for employers?  Stay vigilant. Monitor the proposal’s development.  Do not assume there will be no report this year, and be prepared to marshal the requisite data quickly.  The EEOC could announce a 2025 deadline at any time, including towards the end of the summer which could mean that employers have only a limited time to collect data and submit their reports. For large organizations and multi-corporate enterprises, that may be much more challenging than it may appear.

Employers should also remember that, even without EEO-1 Reports, there are legitimate and practical uses for workforce demographic data.  These include ensuring nondiscrimination under Title VII and other laws where disparate impact liability still exists. Statistical analyses remain key proactive tools for risk management under those laws.  The equal employment opportunity landscape continues to evolve in ways that create new questions for employers.  As always, Seyfarth will continue to track this proposal and its implications as it moves through the rulemaking process. 

For questions regarding potential impact or compliance considerations, please contact the authors of this alert, a member of Seyfarth's People Analytics team, or your Seyfarth attorney.

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Software procurement has become a central feature of modern business operations. Organizations increasingly rely on third‑party tools to support internal workflows, manage data, and deliver products and services to customers. As a result, vendor due diligence is no longer a purely procurement or contracting function. It is a core risk management exercise.

Despite this shift, many organizations still approach software procurement in a linear way. The business identifies a tool, procurement advances the deal, and Legal is brought in late to review contract terms. That approach assumes software presents a uniform level of risk.

It does not.

The legal and regulatory risk associated with software depends heavily on how the tool is used, what data it processes, and how much the business or its customers rely on its outputs. Understanding those factors early is essential to allocating risk appropriately and drafting contracts that reflect operational reality.

The Shift: From Vendor Type to Use Case

A common failure point in vendor due diligence is categorizing software risk based on the nature of the vendor or product rather than the intended use case.

In practice, the same software can present materially different risk profiles depending on how it is deployed.

For example, a tool used internally to organize information or streamline workflows may pose limited legal risk. Outputs are informational, reviewed by employees, and not customer facing. If the tool becomes unavailable, teams can often revert to manual processes with minimal disruption.

By contrast, that same tool may be deployed in a way that affects customers, revenue, or regulated activity. Outputs may be relied upon to make decisions at scale, and errors could result in financial loss, regulatory scrutiny, or reputational harm.

The technology itself has not changed. The exposure has.

For legal and compliance teams, this distinction is critical. Vendor due diligence should begin with a clear understanding of how the software will actually be used, not how it is described in marketing materials.

Understanding Risk Tolerance Early

Effective vendor due diligence requires an explicit discussion of risk tolerance at the outset of procurement. Key questions include:

• Is the tool used internally, or are customers or third parties relying on its outputs?
• Is the software business critical, or can it be easily replaced?
• Does the tool operate at scale?
• What types of data are involved, and how sensitive is that data?
• What happens if the outputs are inaccurate or unavailable?

These questions are not theoretical. They inform whether Legal can support limited pilot programs or sandboxed experimentation, or whether stronger controls and contractual protections are required before deployment.

Importantly, this evaluation must be cross‑functional. Legal teams cannot assess these risks in isolation. Product, engineering, security, and privacy stakeholders each provide essential context about system functionality, data flows, and operational reliance.

Governance Before the Contract

Vendor due diligence should not begin with contract drafting. It should begin with governance.

Before negotiating liability caps, indemnities, or service levels, organizations should be able to answer foundational governance questions, including:

• What data is being input into the system?
• What outputs or actions does the software produce?
• Who is the intended audience for those outputs?
• How are outputs reviewed, tested, or monitored after deployment?

Without clarity on these points, contracts often attempt to compensate for uncertainty through broad disclaimers or generic risk allocation. That approach rarely succeeds. This is because contracts allocate harm after it occurs – they do not prevent it.

Transparency, testing, and auditability are therefore essential components of modern vendor governance. If an organization cannot observe how a system operates, it cannot meaningfully govern its use.

Why Context Should Drive Contract Strategy

Once the use case, data flows, and reliance patterns are understood, contract strategy can be calibrated appropriately.

When software is internal, informational, and low impact, Legal may reasonably prioritize efficiency and speed, accepting lighter commercial protections. As software becomes more embedded in operations, more connected to sensitive data, or more relied upon by customers, contracts must do more work.

In higher‑risk deployments, legal focus typically shifts to:

• Data ownership and control, including limits on secondary use
• Audit and oversight rights to support ongoing governance
• Representations regarding accuracy, compliance, and performance
• Indemnities and liability structures aligned to potential harm
• Exit and transition protections if the vendor relationship ends

At that point, the agreement is no longer a routine procurement document. It becomes a mechanism for allocating operational, data, and compliance risk.

The Hidden Failure Point: Intake

One of the most common challenges in vendor due diligence is not contract drafting. It is inadequate intake.

Business teams are often asked to describe what a tool does in general terms, without being required to explain how it will be used, who will rely on it, or what the consequences of failure would be. Legal is then expected to negotiate appropriate protections without a clear view of the underlying risk.

To address this, organizations increasingly benefit from structured intake processes that require both internal stakeholders and vendors to surface key facts early in procurement. When intake is done well, Legal can calibrate its approach. Low‑risk tools can move quickly, while higher‑risk deployments receive the scrutiny they require.

From Contract Review to Risk Architecture

Effective software procurement is not about redlining templates in isolation. It requires understanding how technology, data, and reliance intersect in practice.

When Legal has that context, contracts function as instruments of thoughtful risk allocation rather than reactive defenses. When that context is missing, organizations often discover too late that they have either over‑lawyered low‑risk deals or under‑protected high‑impact deployments.

The takeaway is straightforward. Software procurement is not merely a contract review exercise. It is a risk‑allocation decision.

What This Means for In‑House Counsel

For in‑house legal teams, this shift requires moving upstream.

Vendor due diligence should begin with a structured evaluation of use, data, reliance, and governance before deployment decisions are finalized. Legal teams that embed this analysis into procurement workflows are better positioned to support innovation while managing risk deliberately.

By engaging early, aligning cross‑functional stakeholders, and grounding contracts in operational reality, Legal can act as a strategic partner rather than a last‑minute gatekeeper.

Edited by Jason Priebe and John Tomaszewski

Both chambers of the New York Legislature have passed the “Anti‑Waiver of Employment Rights Act.” The legislation would establish that rights under the Labor Law and Human Rights Law are non‑waivable as a matter of public policy. It explicitly seeks to abrogate court decisions permitting employers to limit statutory rights through private agreement, including by shortening limitations periods and restricting enforcement mechanisms.

The bill will become law if signed by Governor Hochul. Under New York legislative procedure, the bill may not be presented to the Governor for consideration, if at all, until year-end 2026, at which time she will be required to approve or veto it. Thus, the bill will sit in limbo for an indefinite period until the parties choose to move it forward.

Core Prohibition and Limited Exceptions 

The statute provides that no contractual provision waiving or limiting any employee’s substantive or procedural rights, remedies, or claims under the Labor Law or Human Rights Law “shall be valid,” including with respect to claims that are asserted or unasserted.

The statute is drafted broadly, reaching any contractual provision—express or implied—that limits such rights, remedies, or claims, including those that may not yet be asserted or even legally cognizable. In practice, the law is expected to eliminate most prospective waivers and sharply limit post‑dispute waivers.

Waivers are permitted only where they are:

• part of a good‑faith, bona fide dispute resolution not raised or initiated by the employer; or
• included in an agreement entered at or after termination of employment.

The statute also preserves certain waivers in collective bargaining agreements where expressly authorized.

Federal Preemption and Timing

The statute by its terms does not apply where its provisions are preempted by federal law, a carveout that is likely to significantly limit its reach. In particular, arbitration agreements governed by the Federal Arbitration Act—including class and collective action waivers incorporated into such agreements—will likely remain enforceable under prevailing federal law.

At the same time, the statute’s broad reference to “procedural rights” is likely to generate litigation at the margins, including challenges to particular provisions or structures.

The statute would take effect immediately upon enactment, which as noted above could be several months from now, if at all. Although the bill does not expressly address retroactivity, legislative materials indicate an intent to reach existing agreements that purport to waive statutory rights, an issue that will likely be litigated.

What This Means for Employers

If enacted, S4424‑A would have significant implications for standard employment agreements, including:

1. Contractual Limitations Periods.  Provisions shortening statutes of limitations—previously upheld by some courts—would likely be unenforceable.
2. Arbitration Agreements and Class Waivers.  Core arbitration frameworks are likely to remain enforceable under federal law, but employers should expect continued litigation over these questions.
3. Mid‑Employment and Prospective Waivers.  Mid‑employment releases tied to compensation and other prospective limitations on statutory rights are likely to face substantial risk.
4. Other Contractual Terms.  Jury waivers, confidentiality or non‑disparagement provisions, and classification‑related disclaimers may be implicated if they are construed to limit statutory rights.

Conclusion 

S4424‑A would represent a significant shift in New York employment law, replacing more targeted regulation with a broad prohibition on contractual limitations of statutory rights.

If signed, the law will likely prompt substantial litigation, particularly regarding federal preemption and existing agreements, and require employers to reassess longstanding approaches to employment contracts in New York.

We will continue to monitor developments and provide updates. Please reach out to the authors or your Seyfarth attorney with any questions.

This recognition highlights the firm’s deep experience across all areas of labor and employment law, as well as the strength of its full-service capabilities, spanning its Downtown Los Angeles and Century City offices.

The Century City office, established in 1973, was built on a strong labor and employment foundation and has since expanded to serve clients across several practice areas. The firm has continued to grow strategically and broaden its presence in the region, including the opening of a second office located in downtown Los Angeles in 2009.

On May 15, USCIS updated its guidance related to Somalia noting: “When completing the Expiration Date (if any) fields on Form I-9, input ‘as per court order’ in Section 1 and ‘July 1, 2026,’ in Section 2 along with a note in the ‘Additional Information box.’

This update revises our prior blog post on the status of TPS EAD extensions. With this change, all TPS placeholder dates are now aligned, Section 2 expiration dates across the board have been extended to July 1, 2026.

On May 1, the court extended the stay in the pending a U.S. Supreme Court ruling on the parallel Syria and Haiti TPS cases, a decision that could have broader implications for the TPS program overall. Employers should watch both the district court and Supreme Court proceedings closely, as a ruling in the Syria/Haiti cases could affect TPS protections with little advance notice.

For more information contact the authors directly. Seyfarth’s Immigration Compliance & Investigations specialty group is recognized as a national leader in the field. Trusted by Fortune 100 companies and small businesses nationwide, the team provides strategic, practical guidance across the full spectrum of immigration compliance. The group advises on Form I-9 and E-Verify compliance including electronic I-9 matters; ICE inspections and worksite enforcement actions; internal immigration assessments and I-9 audits; DOL immigration-related wage and hour investigations; H-1B/LCA compliance; and DOJ’s IER and OCAHO anti-discrimination matters, including foreign sponsorship “America First” and export control/ITAR issues.

*Selene Malench is a Case Assistant on Seyfarth’s Immigration Compliance & Enforcement team. Many thanks for her contribution to this legal update.

“Seyfarth is proud to support Good Springs in this meaningful investment addressing the critical need to repair and upgrade aging U.S. water infrastructure,” said Andrew Lucano, chair of Seyfarth’s Corporate department and co-chair of the M&A practice. “Good Springs is focused on building strong partnerships with talented management teams to drive growth, and we were pleased to help them bring this vision to life.”

The Seyfarth team was led by Andrew Lucano, David Warburg, and Breanne Vaclavik, and included Whitney Schmidt, Aly Audy, Ashley Bock, Marc Fosse, Michael Rosenthal, Roberto Tosti, Jason Polevoy, Brianna Richardson, Ilana Morady, Amy Hoang, Joshua Ditelberg, and Deirdre Mangan.

Seyfarth’s Corporate department offers clients a full-service, multidisciplinary team of attorneys across virtually all areas of practice. The corporate group works with an array of businesses from large well-known companies to start-ups and is highly regarded for its deep knowledge of mergers and acquisitions, securities, investment management, corporate counseling, financing, and commercial transactions.

About Seyfarth

With approximately 1000 lawyers across 17 offices, Seyfarth Shaw LLP provides advisory, litigation, and transactional legal services to clients worldwide. The firm is recognized for its innovative approach to delivering legal services, combining deep industry knowledge with advanced technology and substantive excellence.

The Washington Post quoted partner Christy Kiely in its May 15, 2026 article, “Federal civil rights watchdog wants to stop tracking data on race and sex.” The piece examines the US Equal Employment Opportunity Commission’s proposal to end decades‑long collection of employer demographic data and what that shift could mean for workplace discrimination enforcement. 

Kiely emphasized that employers should continue long‑standing compliance practices despite the proposed rollback, noting:

“Employers should continue to collect the information as a best practice, because Title VII obligations are not going away and disparate impact is not going away. It’s been deprioritized, but it’s still in the statute.”

The full article is available here.

Welcome back to The Week in Weed, your Friday look at what’s happening in the world of legalized marijuana. This week, we have signature-gathering news from Idaho. The Congressional Research Service issued a new report on rescheduling. The White House drug czar has a good reminder about marijuana’s legal status. And finally, the DC cannabis scene is livelier than you might expect.

IDAHO

As those of us who have followed the cannabis saga over the past few years know all too well, the road to legalization is littered with obstacles and setbacks. One of those involves gathering signatures to put a legalization measure on the state ballot. Pro-cannabis group National Medicine Alliance of Idaho has just submitted twice the number of signatures needed to qualify for November’s election in the Gem State. Even though some signatures will be disqualified (true of any ballot initiative, not just ones involving cannabis), you’d think they’d be in the clear. But it’s not over ’til it’s over, so stay tuned.

CRS REPORT

Federal rescheduling has led to an avalanche of articles on how this will change the industry, what’s now legal, and when business expenses can be deducted on tax returns. If you’re searching for a calm, well-researched, hype-free examination of the situation, have a look at the recent report put out by the Congressional Research Service (CRS).

IMPORTANT REMINDER

The White House drug czar, Sara Carter Bailey, would like to make it clear that cannabis is still illegal.

Executive-level Schedule III allows for doctors and research and for medicine, for medicinal purposes.

Meaning, for those of you in the back, that adult-use cannabis is still prohibited under federal law.

AND FINALLY

You can be forgiven for thinking that the DC cannabis industry might be more cloak and dagger than wild and crazy. Medical marijuana is legal, but adult-use is not, even though voters backed it years ago, thanks to Congress saying NO. (If you’d like to know a whole lot more about the DC legislative process, check out one of very early blog posts on the topic. And yes, that John Oliver link still works, and is well worth watching.) In fact, the DC cannabis scene is pretty diverse, including both bars and wellness. Of course, this is for medical purposes only, but you can self-certify to that – no doctor’s note needed.

Be well everyone – we’ll see you next week.

By: Ilana Morady

Cal/OSHA recently issued a revised draft of its general industry workplace violence prevention standard, offering the clearest indication yet of how the Division intends to build on SB 553. Although the rule is not final, the current draft reflects meaningful stakeholder input and signals where compliance expectations are likely headed. Employers should treat it as a practical roadmap, particularly given that Cal/OSHA is already enforcing workplace violence prevention obligations through SB 553.

Comments on the current draft are due by June 1, after which additional revisions are expected before the rule advances further in the rulemaking process.

Expansion Beyond SB 553

The draft largely incorporates the framework created by SB 553, which took effect in July 2024, but goes further by adding detail on hazard assessment, post‑incident response, and program implementation. The Division continues to rely on its authority to impose additional requirements it deems necessary to protect employee safety. The final standard will not simply mirror the statute but instead expand on it in ways that require more structured and documented compliance efforts.

Trauma Counseling Requirement Refined

One of the most closely watched provisions remains the trauma counseling requirement. The revised draft reflects a shift from earlier language by clarifying that employers satisfy this obligation if counseling is available through workers’ compensation, employee assistance programs, or initial services offered by the employer.

Cal/OSHA also emphasizes that employers are not responsible for diagnosis or treatment. Even with these revisions, questions remain about which employees qualify as “affected” and how broadly the obligation may apply following an incident.

Scope and Coverage Changes

The updated draft introduces several targeted revisions that clarify who is covered and how coverage is measured. The small employer exemption has been narrowed by revising how employee headcount is calculated. Instead of looking at staffing at a single point in time, the draft requires employers to assess whether they have 10 or fewer employees based on staffing levels at the workplace over the preceding 365 days. This change is intended to prevent fluctuation in coverage based on temporary staffing patterns and aligns the measurement approach with other Cal/OSHA standards.

The scope of the rule has also been expanded to expressly include employer‑provided transportation. This addition closes a gap that could otherwise exclude incidents occurring during transportation arranged or controlled by the employer, such as shuttle services or company vehicles used for work-related travel.

The draft further revises key definitions to align with existing Cal/OSHA provisions. In particular, the definitions of “authorized employee representative” and “designated representative” have been conformed to existing regulatory language, which may broaden who can participate in workplace violence prevention activities, including access to records and involvement in investigations. These definitional changes are likely to have practical implications for how employers manage employee participation, third-party representatives, and the flow of sensitive information within their programs.

Hazard Assessment Expectations

Cal/OSHA has revised not just the examples in the hazard assessment section, but the structure and framing of the analysis itself in response to stakeholder feedback. Earlier drafts included a list of specific “examples” of workplace violence hazards, which many commenters viewed as overly prescriptive and potentially creating a checklist approach to compliance. In the current draft, the Division has removed several of those examples and reframed the list as factors for employers to consider when evaluating risks.

The agency deleted references to high crime areas, hostile work environments, working with individuals with a history of violence, excessive overtime, and providing security services. These changes reflect an effort to avoid characterizing certain industries or conditions as inherently hazardous and to shift the focus back to employer-specific risk assessments.

In addition, the Division has incorporated “appropriate staffing levels” into the definition of work practice controls. This change aligns the draft with the healthcare workplace violence standard and signals that Cal/OSHA may view staffing decisions as relevant to hazard mitigation in certain contexts.

Program Implementation and Training

The draft includes a number of refinements that affect how workplace violence prevention programs must operate. Employers must ensure that employees can report concerns to someone other than a supervisor who may be involved in the incident, particularly in employee‑on‑employee situations.

Training requirements have also been clarified. Employees must be given an opportunity to ask interactive questions, and where training is conducted remotely, those questions must be answered within one business day. The draft further clarifies that while employees are protected from retaliation for lawful self‑defense, employers may still enforce policies designed to prevent physical confrontations and reduce the risk of injury.

Recordkeeping and Access

The revised draft expands employee access to workplace violence records, including investigation materials. It also allows designated representatives to obtain access, subject to limited redaction of personal identifying information.

This expanded access raises practical considerations around confidentiality and data security, particularly given the sensitive nature of workplace violence investigations and the lack of clear boundaries around who may qualify as a representative.

Practical Implications Although further revisions are expected before formal rulemaking proceeds, the direction of the regulation is clear. Cal/OSHA is moving toward a comprehensive workplace violence standard that builds on SB 553 while expanding employer obligations in several key areas. In the meantime, enforcement continues under existing law.

The authors analyze recent EEOC litigation and enforcement trends, highlighting how cultural flashpoints, DEI-related considerations, and the use of artificial intelligence and third‑party recruiting tools can create legal risk at the earliest stages of employment decision‑making. The piece also outlines practical steps employers can take to strengthen compliance, including skills‑based hiring, governance of hiring technology, targeted training, and consistent oversight throughout the recruiting process.

The authors emphasize the urgency for proactive compliance, noting:

"Recruiting and hiring sit at the front line of both cultural flashpoints and legal risk. . . As scrutiny intensifies, it is essential for employers to adopt proactive, legally grounded hiring and recruiting strategies. In doing so, employers can manage legal risk while attracting and onboarding the best talent."

The full article is available here.

The launch comes at a pivotal moment as the industry is being reshaped by the convergence of institutional investment, evolving regulatory frameworks, changing media and distribution models, and technology enabled innovation. As expectations across the market shift, market participants increasingly seek integrated, commercially focused legal counsel that can support both growth opportunities and business-critical risk.

“The launch of our Sports & Entertainment group reflects both the richness of the firm’s experience in the sector and a deliberate firmwide strategy to build growth platforms powered by innovation and focused on client impact,” said Lorie Almon, chair and managing partner of Seyfarth Shaw. “The converging forces reshaping this industry are creating high-stakes implications for organizations and individuals operating across sports and entertainment. We are meeting this moment with a coordinated, industry-aligned approach.”

Seyfarth’s Sports & Entertainment group leverages the firm’s sophisticated technology and forward‑thinking approach to deliver a 360‑degree view of the evolving marketplace. Drawing on decades of industry experience, the group supports clients across the full lifecycle of sports and entertainment enterprises, from investments and brand strategy to crisis management and internal investigations, as well as the ownership structures and operational challenges that increasingly require cross-disciplinary legal guidance.

“The sector is defined by kinetic energy—capital moving, rules changing, platforms emerging,” said Marc Mukasey, partner in Seyfarth’s Litigation department and co-chair of the firm’s Trial group. “Our team is built to operate at that velocity, helping stakeholders navigate complexity, manage risk, and act decisively in an industry that doesn’t stand still.”

The group is intentionally structured to support individuals, institutions, and enterprise‑level participants, including professional and college sports organizations, conferences, academic institutions, ownership groups, leagues, developers, media and technology platforms, celebrity brands, and investors engaging with the sector as a sophisticated global business ecosystem.

“What distinguishes this group is the breadth of our platform and the way we deliver it to the market,” said Ivan Smith, partner and leader within Seyfarth’s Sports & Entertainment group and partner in the firm’s Labor & Employment department. “We bring together sophisticated transactional capabilities with deep experience in workplace strategy, investigations, and high-stakes litigation—so clients can move forward with coordinated counsel that aligns with how these enterprises actually operate as businesses.”

The group also draws on Seyfarth’s nationally recognized work advising colleges and universities on the most consequential legal and business issues reshaping college athletics. As the sector continues to converge at the intersection of education, employment, equity, and enterprise, our attorneys, including members of our Evolution of College Sports Task Force, regularly advise on student athlete compensation and revenue sharing frameworks, name, image, and likeness (NIL) arrangements, employment classification risk, Title IX compliance and sports-related labor and employment considerations.

Seyfarth’s Sports & Entertainment group delivers experienced, commercially focused counsel at the pace the market demands, with an eye toward measurable impact for our clients.

More information about Seyfarth’s Sports & Entertainment group can be found here.

About Seyfarth Shaw LLP

With approximately 1,000 lawyers across 17 offices, Seyfarth Shaw LLP provides advisory, litigation, and transactional legal services to clients worldwide. The firm is recognized for its innovative approach to delivering legal services, combining deep industry knowledge with advanced technology and substantive excellence.

Seyfarth partners with clients to solve complex challenges across sectors including corporate, litigation, real estate, regulatory compliance, labor and employment, and executive compensation and other benefits work. Committed to collaboration and client-focused solutions, Seyfarth continues to set the standard for legal service delivery in an evolving global marketplace.

Connecticut has long prohibited employers from requiring employees to execute an “employment promissory note”—defined broadly as any agreement requiring an employee to pay the employer if the employee leaves employment before a stated period of time, including repayment framed as reimbursement for training.

On May 11, 2026, Governor Ned Lamont signed comprehensive workforce legislation (H.B. 5003) that significantly expands this framework.  Effective October 1, 2026, the amended law will extend the prohibition to all employers, regardless of size; and reinforce that agreements requiring repayment tied to early separation are void as against public policy, subject only to narrow statutory exceptions.  Previously, the prohibition applied only to employers with 26 or more employees, meaning this change will bring smaller employers squarely within the statute’s scope for the first time.

Prohibition and Narrow Exceptions 

As expanded, Connecticut law prohibits employers from requiring, as a condition of employment, that employees agree to repay money if they leave employment before a specified period.  The law’s definition of prohibited agreements is intentionally broad and includes: (i) training repayment agreements; (ii) agreements requiring reimbursement for onboarding or certification costs; and (iii) any arrangement, imposed as a condition of employment, that requires payment upon early separation, regardless of how it is characterized.

The statute focuses on substance over form, and labeling a payment obligation as “training reimbursement” does not avoid the prohibition.

The statute preserves a limited set of exceptions for agreements that:

1. Require repayment of advances of money (e.g., loans or prepaid amounts);
2. Require payment for property sold or leased by the employer to the employee;
3. Relate to sabbatical leave arrangements; or
4. Are part of certain collectively bargained programs.

Outside of these narrow categories, however, repayment obligations imposed as a condition of employment and tied to continued employment are likely to be unenforceable, limiting the extent to which such arrangements can be structured or characterized to fall within an exception.

Comparison to New York and California

Connecticut’s approach differs materially from other recent “stay‑or‑pay” statutes.  As discussed previously here, here, and here, New York permits certain repayment arrangements under defined statutory exceptions, including non‑educational financial incentives and costs associated with obtaining transferable credentials, subject to strict conditions.

California’s AB 692 similarly imposes significant restrictions and compliance requirements on repayment provisions, though it remains a framework that regulates—rather than eliminates—such arrangements (see here).

By contrast, Connecticut adopts a more categorical prohibition on employment‑conditioned repayment arrangements, creating a stricter framework than either New York or California.  The statute does not establish a standalone enforcement mechanism or civil penalty framework, and instead renders covered provisions void as against public policy.

Next Steps for Employers

With the October 1, 2026 effective date approaching, employers should:

• Review and amend existing agreements (including offer letters, training reimbursement agreements, retention arrangements, and programs involving sign‑on bonuses, relocation assistance, immigration sponsorship, and tuition or education-related assistance) for provisions that may require repayment upon early separation;
• Reevaluate training and retention incentive strategies to consider restructuring such incentives to be paid out at the end of any desired retention period, particularly where programs rely on repayment obligations; and
• Consider multistate compliance approaches, including whether to adopt state‑specific or uniform national practices in light of differing legal requirements.

Employers should also continue to monitor developments in this area, as additional jurisdictions may adopt similar restrictions.

Please reach out to the authors – or your Seyfarth attorney – with any questions.

Brief History of Oklahoma’s Medical Marijuana Law

Oklahoma’s medical marijuana framework began with a voter‑approved ballot initiative in June 2018. The state moved quickly to implement the program, issuing patient licenses starting in August 2018 and laying the groundwork for a regulated medical marijuana market. In 2019, the Legislature adopted the medical marijuana “Unity Bill” to clarify patient protections, employer rights, and public safety concerns—particularly in the employment context. The most recent amendments build on that foundation by adjusting how the statute treats drug testing and safety‑sensitive work.

Core Employment Protections to Licensees Remain Intact

The law, as amended, continues to prohibit employers from refusing to hire, disciplining, discharging, or otherwise penalizing an applicant or employee based solely on the individual’s status as a licensed medical marijuana patient. Licensee status alone remains insulated from adverse employment action.

When Employers May Act on Marijuana Use or Test Results

The amended law allows employers to take employment action based on marijuana use or a positive drug test for marijuana if one or more statutory exceptions applies. Specifically, employers may act when:

• the applicant or employee does not hold a valid medical marijuana license;
• the individual  possesses, consumes, or is under the influence of medical marijuana at the workplace or while performing job duties; or
• the action is taken pursuant to a written drug and alcohol testing policy that complies with the Oklahoma Standards for Workplace Drug and Alcohol Testing Act.

Outside of these scenarios, adverse action based solely on applicants’ and employees’ marijuana test results remains prohibited.

Zero Tolerance Standard for Safety‑Sensitive Positions

A central feature of the amended law is that it requires employers to apply a zero‑tolerance drug and alcohol  standard to applicants and employees in safety‑sensitive roles. Individuals performing work that falls within the statutory definition of a “safety-sensitive position” are subject to this stricter standard by operation of law, regardless of whether the employer takes a more permissive approach for employees in other positions.

In other words, once a position qualifies as safety‑sensitive, the employer must enforce zero tolerance for marijuana use under its drug and alcohol testing program; this requirement is not left to employer discretion.

Notably, however, the statute does not define what constitutes a “zero tolerance” standard, leaving some uncertainty as to how the requirement must be applied by employers in practice and whether further guidance from regulators or courts will be necessary.

Definition of “Safety‑Sensitive”

The amendment removes an employer’s ability to designate a position as safety‑sensitive based solely on whether it reasonably believes the job included tasks or duties that could affect the safety or health of the employee or others.. Rather, the law focuses exclusively on the actual job duties by defining a “safety‑sensitive position” as one in which an employee performs one or more of  the following duties:

• handling, processing, packaging, storing, disposing  or transporting of hazardous materials;
• operating motor vehicles, other vehicles, machinery, equipment, or power tools;
• repairing, maintaining, or monitoring equipment, machinery, or manufacturing processes, the malfunction or disruption of which where could cause injury or property damage;
• performing firefighting duties;
• operating, maintaining, or overseeing critical infrastructure or services, including utilities and power systems;
• working with volatile, flammable, combustible, or highly regulated materials or chemicals;
• dispensing pharmaceuticals;
• carrying a firearm; or
• providing direct patient care or direct child care.

In other words, a position qualifies as safety‑sensitive if it involves the performance of at least one of the enumerated duties, regardless of the employer’s subjective assessment of the job.

Employer Rights Preserved

The law continues to make clear that employers do not have to:

• permit the use or possession of medical marijuana during working time or on company premises; or
• reimburse employees for costs associated with medical marijuana.

Employers also retain the right to adopt and enforce written drug and alcohol testing policies in accordance with Oklahoma’s Standards for Workplace Drug and Alcohol Testing Act.

Action Items for Employers

To prepare for the November 1, 2026 effective date, Oklahoma employers should consider taking the following steps:

• Review and update job descriptions to ensure that any positions designated as safety‑sensitive meet the statute’s revised definition.
• Revise drug and alcohol testing policies to reflect zero‑tolerance standards for safety‑sensitive roles and confirm alignment with the Oklahoma Standards for Workplace Drug and Alcohol Testing Act.
• Evaluate hiring and disciplinary practices to ensure adverse actions are not taken based solely on license status or test results outside the law’s permitted exceptions.
• Train supervisors and HR personnel on impairment recognition, for‑cause testing, and the legal distinction between safety‑sensitive and non‑safety‑sensitive positions.
• Update employee handbooks and workplace communications in advance of the amendment’s effective date.
• Consult employment counsel regarding classification decisions and policy implementation to reduce compliance risk.

Law360 quoted Brett Bartlett, co-chair of Seyfarth's national Wage and Hour Litigation practice, in its article, “DOL Overtime Rule Update Leaves Attys Waiting For Next Hike.” The piece, published on May 14, 2026, explores the US Department of Labor’s decision to restore the overtime salary threshold to 2019 levels following recent court rulings, and what future rulemaking may look like for employers.

Mertineit, Mintz, and Wexler authored Chapter 13, “USA Trends and Developments,” examining the evolving US legal landscape governing restrictive covenants, trade secret protection, and employee mobility.

The chapter provides a detailed analysis of the Federal Trade Commission’s abandoned effort to impose a nationwide non-compete ban, the continued expansion of state-level restrictions, and emerging judicial trends that are reshaping how businesses protect confidential information. The authors also explore how technological advances, remote work, and high-stakes litigation are increasing both trade secret risk and enforcement complexity. 

They explain that regulatory scrutiny remains intense despite the FTC’s withdrawal of its rule:

“The regulatory pressure is far from disappearing, and businesses operating in the United States must carefully safeguard their intellectual property in the event their restrictive covenant agreements are struck down or otherwise limited.” 

The full chapter is available in the Chambers Trade Secrets 2026 Global Practice Guide.

Seyfarth Synopsis: Growth in women’s professional sports, including Houston’s anticipated return of a WNBA team, is drawing renewed focus on pregnancy‑related employment issues. Recent WNBA developments underscore how federal law, labor agreements, and enforcement trends are evolving in tandem. Employers across industries can draw key lessons on managing accommodation obligations and mitigating risk.

Women’s professional sports are experiencing rapid growth, investment, and visibility. Alongside that momentum has come increased scrutiny of employment practices—particularly those affecting pregnancy, caregiving, and performance expectations. Recent developments in the WNBA, including the ratification of a new collective bargaining agreement, offer a timely case study in how evolving federal law, labor agreements, and enforcement priorities intersect.

Notably, Houston is poised to regain a WNBA franchise following reports that Houston Rockets owner Tilman Fertitta is in the process of acquiring Connecticut’s team, further expanding women’s professional sports in Texas. That growth brings renewed attention to employment law issues that extend well beyond professional basketball—particularly pregnancy accommodations and regulatory compliance.

Pregnancy‑Related Protections Under Federal Law

Federal law has long prohibited discrimination based on pregnancy, childbirth, or related medical conditions. Title VII of the Civil Rights Act of 1964, as amended by the Pregnancy Discrimination Act, bars adverse employment actions motivated by pregnancy or by stereotypical assumptions about an employee’s commitment, availability, or ability to perform.

More recently, Congress expanded workplace protections through the Pregnant Workers Fairness Act (“PWFA”), which requires covered employers to provide reasonable accommodations for known limitations related to pregnancy, childbirth, or related medical conditions unless doing so would impose an undue hardship. Unlike the Americans with Disabilities Act, the PWFA does not require an employee to demonstrate that a condition rises to the level of a disability. Instead, it centers on whether the employer engaged in an interactive process with the pregnant employee and reasonably considered the accommodation request.

For employers, this framework means that decisions affecting job duties, schedules, travel, or assignments of pregnant employees should be carefully documented to demonstrate legitimate business justifications.

The WNBA’s New CBA as a Case Study in Pregnancy Protections

The WNBA’s newly ratified seven‑year collective bargaining agreement illustrates how pregnancy protections can be reinforced through collective bargaining. Among its most notable provisions is a rule prohibiting teams from trading a player during pregnancy without the player’s affirmative consent. Commonly referred to as the “Dearica Hamby Rule,” the provision arose from the controversial trade of Dearica Hamby while she was pregnant in 2023. Hamby subsequently filed a discrimination and retaliation lawsuit against the Las Vegas Aces and the WNBA. The WNBA was dismissed by a federal judge, and the remaining claims were ultimately dismissed by mutual agreement between Hamby and the Aces.

While a “trade” is unique to professional sports, the underlying concern is familiar across employment contexts. In traditional workplaces, similar scrutiny may arise from involuntary transfers, territory reassignments, or reductions in responsibility of pregnant employees. When such actions occur after pregnancy disclosure—or are justified by pregnancy‑related assumptions—they can raise significant discrimination concerns under federal law.

The broader lesson is that pregnancy‑related protections extend beyond hiring and termination decisions to include other ostensibly neutral “business” decisions that materially affect an employee’s work.

Collective Bargaining and Statutory Compliance

The WNBA’s labor structure highlights an important principle for unionized employers more generally: collective bargaining agreements do not displace federal employment statutes. Even where a CBA governs compensation, assignments, or discipline, employers remain subject to Title VII, the PWFA, the Family and Medical Leave Act, other federal anti-discrimination laws, and comparable state laws. Employers negotiating or administering collective bargaining agreements should ensure that negotiated provisions align with evolving statutory requirements and enforcement priorities.

Developing Law: The Fifth Circuit and the PWFA

Complicating compliance planning, the Pregnant Workers Fairness Act is currently under review by the United States Court of Appeals for the Fifth Circuit. After initially allowing enforcement, the court vacated its decision and agreed to rehear the case en banc in State of Texas v. Bondi, No. 24‑10386 (5th Cir. Jan. 14, 2026) (per curiam). The litigation focuses on whether Congress validly enacted the statute under the Constitution’s quorum requirements, rather than on the substance of the accommodation obligations themselves. The issue may ultimately reach the United States Supreme Court.

For now, the PWFA remains enforceable nationwide, including in Fifth Circuit states such as Texas. Employers should not view the pending litigation as a pause on compliance; maintaining policies and practices that align with the PWFA remains the prudent course.

Enforcement Trends: Increased EEOC Focus on Pregnancy‑Related Claims

At the same time courts are considering the contours of pregnancy accommodation law, the Equal Employment Opportunity Commission has made clear that pregnancy‑related claims are an enforcement priority. Since the PWFA took effect in 2023, the agency has increased its focus on pregnancy, childbirth, and related medical conditions through outreach, investigations, and early enforcement efforts.

The EEOC has emphasized that pregnancy‑related claims need not involve termination. Alleged failures to engage in an interactive process, denials of modified duties or schedules, and adverse actions following pregnancy disclosure—including lateral reassignment—may all draw scrutiny.

For employers in physically demanding, performance‑driven, or highly visible workplaces, this enforcement posture has significant implications. While these characteristics are common in professional sports, they are equally present in healthcare, manufacturing, logistics, and many client‑facing roles throughout Texas and beyond.

Why This Matters Beyond Women’s Sports

Women’s professional sports increasingly serve as a high‑visibility testing ground for workplace practices that later reverberate across industries. As leagues expand and gain prominence in markets like Texas, employment decisions that might once have drawn limited attention are now subject to greater scrutiny by regulators, employees, and the public.

For employers across industries, the takeaway is clear: pregnancy‑related compliance remains a focal point for both the courts and regulators, and missteps—particularly during periods of growth or increased visibility—can carry significant legal and reputational consequences.

Connecticut has enacted a broad workforce bill that expands existing employment protections and introduces new compliance obligations in a range of subject areas. While many provisions build on existing statutory frameworks, the law significantly increases employer obligations, operational complexity, and, in some cases, potential compliance and enforcement exposure, particularly for multistate companies.

This alert provides a high-level overview of the most significant provisions. Seyfarth will be issuing standalone alerts addressing several of these topics in greater detail.

Expanded Pay Transparency Requirements

Effective October 1, 2026, Connecticut employers must include not only wage ranges, but also a general description of benefits and other compensation (e.g., health insurance, retirement, fringe benefits, and paid leave) in job postings. Where no posting is available, this information must be provided upon request, or otherwise prior to or at the time of any discussion or offer of compensation. The law applies broadly to positions performed in Connecticut, as well as roles reporting to a Connecticut‑based supervisor or worksite. These changes expand both the timing and scope of disclosure obligations under Connecticut law and follow a similar trend seen in other states (here and here).

You can read more about Connecticut's Expanded Pay Transparency Requirements and key takeaways for employers in our recent alert here.

“Stay‑or‑Pay” / Training Repayment Restrictions

Effective October 1, 2026, Connecticut’s longstanding prohibition on “employment promissory notes” will be expanded to all employers, regardless of size. As amended, the law broadly prohibits agreements that, as a condition of employment, require employees to repay money if they leave employment before a specified period, including arrangements framed as training reimbursement or similar repayment obligations. Although the statute retains its narrow exceptions, it reflects a more categorical approach than recent laws in jurisdictions such as New York and California.

Overtime Pay Code Notice Requirement

Effective October 1, 2026, employers with 100 or more employees must create and maintain a written overtime pay‑code guide explaining overtime requirements and commonly used pay differentials (such as on‑call, call‑back, and holiday pay). The guide must be made available in English, Spanish, and other commonly used languages, provided to new hires, and updated when new pay codes are introduced.

New Written Notice of Accommodation Rights

Also effective October 1, 2026, employers must provide written notice to employees of their right to reasonable workplace accommodations. Notice must be provided to new hires, to existing employees within the statutory transition period (generally by late January 2027), and following certain employee communications.

Enhanced Lactation Accommodation Requirements

Effective October 1, 2026, Connecticut strengthens its lactation accommodation law by requiring employers to provide reasonable break time to express milk, in addition to regularly scheduled breaks. This change shifts the law from a more discretionary framework to an affirmative obligation.

Service Contractor / Mini‑WARN Obligations

Effective July 1, 2027, Connecticut imposes new obligations on certain covered service contractors in connection with contract terminations or facility closures. Although narrower than typical WARN statutes, the law introduces a compressed notice framework and additional requirements that may affect workforce transition planning.

Labor Peace Agreement Changes (Cannabis Industry)

H.B. 5003 also amends Connecticut’s requirements relating to labor peace agreements for cannabis establishments.

Baseball Players as “Employees”

Finally, the law amends Connecticut’s wage statutes to include minor league baseball players compensated pursuant to a collective bargaining agreement within the definition of “employee.” This change reflects a broader trend of extending statutory protections to categories of workers previously treated differently under wage and hour laws.

Next Steps for Employers

With staggered effective dates approaching, employers should:

• Review existing policies and agreements, including offer letters, compensation practices, and any training or repayment arrangements (such as sign‑on bonuses, relocation assistance, immigration sponsorship, and tuition assistance);
• Update recruiting and job posting practices to comply with expanded pay transparency requirements;
• Develop and implement required notices and guides, including overtime pay‑code materials and accommodation disclosures; and
• Coordinate compliance efforts across legal, HR, and operational teams, particularly where multistate considerations are involved.

Seyfarth will continue to monitor these developments and provide additional guidance. Please reach out to the authors, or your Seyfarth attorney with any questions.

Weiss noted that Spirit Airlines was a true innovator in the aviation industry, reshaping the economics of air travel. However, he explained that the company’s reliance on razor-thin margins left it particularly vulnerable to external shocks—such as the spike in oil prices driven by geopolitical conflict.

Weiss emphasized that this situation offers an important reminder for small business leaders: preparing for cyclical and external risks is critical. He encouraged organizations to study historical patterns within their industries to identify periods of contraction—even those that occurred decades ago—and to proactively plan for how they would weather similar disruptions.

The full discussion can be heard at the 7:30 mark of the episode, "Noon Business Lunch 5/12/26: Positive affirmations, Spirit Airlines, Lower Tech Bills."

Background

In March 2026, a California state court ordered the California Department of Motor Vehicles (“CA DMV”) to allow approximately 20,000 non-domiciled commercial drivers to re-apply for canceled CDLs, finding that the CA DMV could not summarily revoke these without due process, even when acting in response to federal guidance.

The ruling stemmed from a class-action lawsuit filed in December 2025 that contested mass CDL cancellations affecting drivers with certain lawful work authorization and presented additional compliance challenges for employers in an ongoing legal ping-pong battle between the CA DMV and affected drivers.

However, the California court order did not resolve the broader federal licensing issue. CA DMV’s current public guidance states that, although affected drivers may immediately reapply, the CA DMV is not currently issuing non-domiciled commercial learner’s permits (“CLPs”) or CDLs because, according to the CA DMV, FMCSA has directed California not to issue them. The CA DMV states that CDL applications may be placed on hold until the CA DMV determines it can act on them.

Just weeks earlier, on February 13, 2026, FMCSA issued a Final Rule adopting the core elements of its September 2025 Interim Final Rule (“IFR”). The Final Rule limited eligibility for non-domiciled CDLs to individuals holding H-2A, H-2B, or E-2 visas, and took effect on March 16, 2026. As a result, most noncitizens authorized to work are ineligible for a non-domiciled CDL, including most Employment Authorization Document (EAD) holders, such as those with Temporary Protected Status, DACA recipients, asylum seekers, asylees, and refugees.

FMCSA’s current guidance further provides that states unable to comply with the Final Rule as of March 16, 2026, must immediately pause issuance of non-domiciled CLPs and CDLs. FMCSA also treats issuance broadly to include renewals, transfers, upgrades, and reinstatements, creating practical consequences not only for new applicants, but also for existing drivers whose CDL privileges require renewal, correction, restoration, or reissuance.

The IFR itself followed a nationwide FMCSA audit that alleged systemic state-level failures in verifying immigration status through the Department of Homeland Security’s (DHS) SAVE system and raised public safety concerns related to non-domiciled drivers. Although enforcement of the IFR was stayed by the D.C. Circuit in November 2025, the Final Rule was implemented without substantive changes.

Recent Court and Enforcement Developments

On May 6, 2026, the U.S. Court of Appeals for the D.C. Circuit further signaled judicial support for FMCSA’s position by denying emergency motions filed by labor unions and affected workers seeking to stay enforcement of the Final Rule while simultaneously expediting merits review of the consolidated challenges. In a joint statement accompanying the order, Judges Gregory Katsas and Neomi Rao indicated that the petitioners were unlikely to succeed on several core arguments, including claims that FMCSA lacked statutory authority or acted arbitrarily in restricting eligibility for non-domiciled CDLs. The court specifically emphasized that the Final Rule was intended to ensure that vetting of foreign drivers is “no less rigorous” than vetting applied to U.S.-domiciled drivers.

The California dispute is also no longer occurring in isolation. On April 16, 2026, DOT announced that FMCSA was withholding more than $73 million from New York for allegedly failing to revoke illegally issued non-domiciled CLPs and CDLs. DOT stated that FMCSA’s audit of New York’s non-domiciled CDL issuance practices found that 107 out of 200 sampled records were issued in violation of federal law, a failure rate of more than 53%, and alleged that New York’s DMV systems defaulted to issuing eight-year licenses to foreign drivers for non-REAL ID licenses regardless of when their legal status expired. DOT further stated that FMCSA had issued a final determination of substantial noncompliance and was withholding $73,502,543, representing 4% of New York’s National Highway Performance Program and Surface Transportation Program Block Grant funds.

In short, employers are no longer facing only a California-specific due process dispute. DOT and FMCSA are taking the position that state-issued non-domiciled CDLs that do not comply with federal requirements must be revoked and cannot be reissued unless the driver satisfies current federal standards.

What Employers Should Do Now

Among other compliance challenges, employers now have other items to add to their list of ongoing compliance obligations.

• Stay Informed of Immigration Status Changes: Companies that employ individuals with valid work permits should closely monitor whether those work permits or underlying immigration statuses could be affected by recent federal action. Because State Driver Licensing Agencies (“SDLAs”) share information with DHS, the State Department, and FMCSA, if an SDLA learns that a driver no longer has qualifying lawful status, it may be required to downgrade the CDL by removing the CDL privilege from the license.
• Do Not Assume Work Authorization Equals CDL Eligibility: A driver may remain work-authorized for Form I-9 purposes but no longer qualify for a non-domiciled CDL under FMCSA’s Final Rule. This distinction is particularly important for EAD holders who may be lawfully employed but no longer eligible for issuance, renewal, transfer, upgrade, or reinstatement of a non-domiciled CDL.
• Confirm Current CDL Privileges Before Dispatch: Employers should verify that affected drivers have active commercial driving privileges before assigning commercial motor vehicle work. This is especially important for drivers with cancelled, downgraded, expiring, or reinstated licenses, and for drivers whose applications are pending or on hold with a state DMV.
• Plan for Ongoing Reductions: Employers that rely on workers with non-domiciled CDLs outside the three qualifying visa categories should expect constraints on future renewals, transfers, upgrades, and reinstatements, and may need to reconsider recruitment, staffing, subcontracting, and/or sponsorship strategies.
• Monitor State-Specific Enforcement Risk: Employers should not assume this issue is limited to California. DOT’s April 2026 withholding of more than $73 million from New York demonstrates that FMCSA is willing to escalate beyond audits and guidance to funding penalties where it believes a state has failed to revoke noncompliant non-domiciled credentials. Employers with drivers licensed in multiple states should monitor each issuing state’s posture.
• Do Not Assume the Rule Will Be Immediately Enjoined: Although multiple legal challenges remain pending, the D.C. Circuit recently denied emergency efforts to stay the Final Rule and signaled skepticism toward several challenges to FMCSA’s authority and rationale. Employers should therefore plan operationally for continued enforcement rather than assuming the rule will be suspended in the near term.
• Stay Engaged: Maintain contact with your immigration counsel, monitor litigation updates, and follow our blog for continued analysis and updated guidance.

Final Word

Despite ongoing litigation challenging the Final Rule, the D.C. Circuit recently denied emergency motions to block enforcement and signaled skepticism toward several of the challengers’ core legal arguments. Although expedited judicial review is continuing, the current trajectory favors continued enforcement while the cases proceed.

Policy changes remain possible, particularly if workforce disruptions become significant.

Importantly, the issue has now moved beyond California’s court-supervised reapplication process. While California drivers may retain procedural reapplication rights, the CA DMV currently maintains that non-domiciled CDL/CLP applications are being held pending resolution of federal restrictions. At the same time, DOT and FMCSA are actively challenging state non-domiciled CDL programs and, in New York, have sought to withhold federal highway funds based on alleged failures to revoke noncompliant credentials.

Employers and employees should continue monitoring developments and consult legal counsel as needed. For now, employers should treat non-domiciled CDL eligibility as a nationwide, state-by-state compliance issue involving federal rulemaking, FMCSA enforcement, state DMV implementation, and ongoing litigation.

For more information contact  Dawn M. Lurie or Alex Madrak directly. Seyfarth’s Immigration Compliance & Investigations specialty group is recognized as a national leader in the field. Trusted by Fortune 100 companies and small businesses nationwide, the team provides strategic, practical guidance across the full spectrum of immigration compliance. The group advises on Form I-9 and E-Verify compliance; ICE inspections and worksite enforcement actions; internal immigration assessments and I-9 audits; DOL immigration-related wage and hour investigations; H-1B compliance; and DOJ’s IER and OCAHO anti-discrimination matters, including foreign sponsorship and export control/ITAR issues.

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Health Care Beat Episode 55: Building the Future of Health Care: Innovation, Investment, and Impact

On this episode of Health Care Beat, co-host Chris DeMeo is joined by Seyfarth partner Arnold Brown and Shaun Hawkins, Managing Partner of Pier 70 Ventures, to discuss what investors look for in early-stage health care innovation. The conversation explores how founders can balance innovation with risk, navigate regulatory and legal complexities, and use strong compliance and IP strategies as a competitive advantage.

For a transcript of the episode, click here.

The piece, published as a part of the Legal500 Country Comparative Guides, examines the rapidly evolving legal landscape governing artificial intelligence and its intersection with privacy, consumer protection, employment law, and professional responsibility.

The article highlights how US AI regulation is emerging through a fragmented mix of state privacy laws, AI‑specific statutes, ethics rules, and intellectual property doctrines, creating significant compliance challenges for organizations deploying AI at scale. The authors outline three key regulatory fronts—automated decision‑making, synthetic content and digital authenticity, and profession‑specific governance—and emphasize the need for proactive, enterprise‑wide AI governance strategies that extend beyond traditional privacy compliance.

As McConnell, Leipold, and Riley explain:

“Organizations cannot rely on any single legal regime, whether privacy, cybersecurity, or professional ethics, to define the boundaries of responsible AI use.”

The full article is available here.

In this installment, the authors examine three recent decisions from the Armed Services Board of Contract Appeals, offering practical takeaways on defective notice of appeal rights, the limits and exceptions to the 90‑day timeliness requirement, and the board’s constrained jurisdiction to enforce settlement agreements. The article highlights how missteps in government notice and filing mechanics can significantly affect appeal outcomes.

In this forward‑looking analysis, Almon challenges firms to look beyond efficiency gains and instead rethink the systems that produce excellent, client‑centered lawyers. The article explores the risks of over‑reliance on AI, the limits of traditional apprenticeship models, and the leadership responsibility to intentionally design training, workflows, and feedback mechanisms that ensure AI strengthens—rather than erodes—human judgment and critical thinking.

Almon underscored the stakes for the profession, writing:

“Leaders cannot simply roll out AI tools and tout productivity gains — to do so risks losing essential developmental opportunities to gain judgment and expertise and produces lawyers that are little more than a set of hands for AI systems.”

She further cautioned against mistaking polished outputs for true competence:

“Beautifully crafted AI work product can create the illusion of competence but may create scenarios in which lawyers fail to grasp fully the underlying reasoning.”

At the same time, she emphasized the promise of AI when deployed thoughtfully and in service of human growth:

“The best firms will use AI to build better lawyers, not just faster work. Long-term success will depend on whether firms use AI to strengthen human judgment, critical thinking, and client service, rather than replacing them”

The full article is available here.

Seyfarth advised TMGOC Ventures across all aspects of the transaction, which involved several structural and operational complexities, including the hotel’s location on a ground lease with Montgomery County, ongoing management by Marriott International, and a multi‑tiered organizational structure.

The acquisition of the 455‑key property provides TMGOC Ventures with a high‑quality asset strategically located within one of the nation’s leading biopharma corridors. The hotel benefits from resilient demand drivers across life sciences, government contracting, and diversified group and leisure segments, supporting strong fundamentals within a dynamic Washington, DC submarket.

“TMGOC Ventures continues to execute thoughtfully on its hospitality strategy by deploying capital into high‑quality assets aligned with long‑term market fundamentals, and we were pleased to support them on this acquisition,” said Catherine Morgen, partner and lead attorney on the deal. “Transactions involving institutional partners, ground lease structures, and nationally branded hotel management arrangements require careful coordination and strategic focus. Our role was to help TMGOC navigate those complexities while advancing its broader investment objectives in a hospitality market that continues to gain momentum.”

This transaction adds to Seyfarth’s growing roster of hospitality deals in 2026, reflecting the firm’s sustained momentum in the sector.

The Seyfarth deal team included associates Luke Hoover and Seth Boso.

Seyfarth’s Hospitality Real Estate team brings deep market knowledge of how hotel ownership, brand relationships, and capital structures intersect. Anchored by one of the largest real estate practices in the country and integrated with Seyfarth’s corporate, finance, restructuring, and tax teams, the team advises industry leaders on high‑stakes transactions across the full investment life cycle, from repositioning and scaling hospitality platforms to navigating financial distress and preparing assets for long‑term value creation and exit.

About Seyfarth

With approximately 1000 lawyers across 17 offices, Seyfarth Shaw LLP provides advisory, litigation, and transactional legal services to clients worldwide. The firm is recognized for its innovative approach to delivering legal services, combining deep industry knowledge with advanced technology and substantive excellence.

Seyfarth partners with clients to solve complex challenges across sectors including corporate, litigation, real estate, regulatory compliance, labor and employment, and executive compensation and other benefits work. Committed to collaboration and client-focused solutions, Seyfarth continues to set the standard for legal service delivery in an evolving global marketplace.

About TMGOC Ventures

TMGOC Ventures is a real estate and development private equity firm headquartered in Boca Raton, Fla., with more than 150 years of combined experience specializing in the hospitality and multi-family sectors. Co-founded by Sunju Patel and Glenn Alba, TMGOC Ventures was born out of an entrepreneurial spirit and is guided by institutional mindset focused on acquiring and developing a robust hotel and residential portfolio that creates values for investors, partners and communities. TMGOC’s portfolio consists of $1.5 B in existing and development pipeline investments comprising 3,767 hotel keys, along with opportunistic multi-family, office and retail investments. To learn about investment opportunities and current projects, visit tmgocventures.com.

Seyfarth Synopsis: The Second Circuit held that courts must dismiss out-of-state plaintiffs from FLSA collective actions unless the defendant is “essentially at home” in the forum state or consents to the suit in that venue.

In a significant decision that will affect the scope of FLSA collective action litigation, the Second Circuit has held that courts may not adjudicate claims of out-of-state plaintiffs unless the defendant-employer is “essentially at home” in the forum state or consents to the suit there.

The case involves the interpretation of a 2017 Supreme Court decision, Bristol-Myers Squibb Co. v. Superior Court of California (“BMS”), and deepens a circuit split that may end up at the Supreme Court in the near future. The Second Circuit joins the Third, Sixth, Seventh, and Eighth circuits in applying BMS to FLSA collective actions, with the First Circuit being the lone circuit to disagree.

This means that nationwide FLSA collective actions can only proceed in New York, Connecticut, or Vermont federal courts if the employer is “at home” in the forum state—that is, incorporated or headquartered there—or has otherwise consented to the court’s jurisdiction over all claims, including those unrelated to the forum state. Under the Second Circuit’s ruling, each employee participating in an FLSA collective action must independently establish that the court has jurisdiction over their claim. As the court acknowledged, its decision puts a halt to forum shopping, where litigants pick a court to bring nationwide claims “to capitalize on discrepancies between precedents in different circuits.” Plaintiffs no longer can subject employers to nationwide FLSA collective actions in federal courts within the circuit merely because the employer happens to do business in that state.

In this case, two Vermont delivery drivers sued a nationwide bakery in Vermont federal court, claiming that Vermont and out-of-state delivery drivers were all misclassified as independent contractors and owed unpaid overtime under the FLSA. Because the bakery was not based in Vermont, the Vermont federal court lacked the power to hear the claims of the out-of-state delivery drivers, which therefore must be dismissed.

With the Second Circuit joining the majority on this issue, the First Circuit’s contrary position is now an even greater outlier that will likely have less persuasive power on courts outside the First Circuit. Unless that court reverses its position and joins the majority soon, the Supreme Court may have to weigh in to resolve the circuit split and bring nationwide uniformity to FLSA collective action litigation.

Although this decision provides employers sued in the Second Circuit greater ability to oppose nationwide collective actions, employers must be mindful of potential consequences. Successfully preventing a nationwide action from proceeding in one state may invite a flood of copycat lawsuits in other states, or (more likely) a nationwide suit in the employer’s home state where it cannot invoke BMS. Nonetheless, the decision provides additional strategic options when facing putative FLSA collective actions.

Banker & Tradesman quoted Michael Dowley, partner in Seyfarth's Real Estate department, in its article, “OZ 2.0 May Revive Broken Deals.” The piece, published on May 10, 2026, explores how changes to the federal Opportunity Zone program could unlock new investment opportunities, particularly for high net‑worth investors and family offices targeting distressed real estate assets.

Dowley highlighted the opportunistic approach many family offices are taking in the current market, noting:

“They have been taking full advantage of a lot of the distressed office asset class, and swooping in and buying at what they think is a really low basis, compared to what the property traded 10 years ago. Aside from the office distress, it’s way more opportunistic: whatever deals that pencil. They are all cash-heavy and they don’t need to lever with debt, but by and large they still want to do that to increase the returns.”

The full article is available here.

Almon emphasized the importance of aligning metrics with strategy and long‑term outcomes, noting:

"Metrics matter, but only insofar as they illuminate whether strategy is working effectively, to the benefit of both clients and legal talent. When firms focus on indicators that reinforce long-term judgment over short-term optics, the right results tend to follow."

She addressed the role of artificial intelligence in shaping future success, stressing that meaningful impact comes from deep integration rather than surface‑level adoption:

“Counting tools deployed or licenses issued doesn't tell you much. What matters is whether AI is embedded into how work actually gets done, and whether that value is being transferred to clients. Firms that engage in smart strategic design thinking, that look to provide previously unknowable insight and create tomorrow's best lawyers early are positioning themselves to deliver exceptional results and client value, not just more activity.”

The full article is available here.

For plans using the 2002 “wired-at-work or consent” safe harbor, the proposed regulations would require plan administrators to provide a one-time paper notice — provided before any electronic qualified retirement plan benefit statement — to participants, beneficiaries, or alternate payees who first become eligible on or after January 1, 2026, informing them of their right to opt out of electronic delivery and receive all disclosures required under Title I of ERISA (i.e., SPDs, SMMs, SARs, benefit statements, etc.) on paper, free of charge. This requirement applies only to newly eligible individuals and is not retroactive (i.e., the plan administrator does not need to provide the one-time notice to individuals who became eligible for the qualified retirement plan prior to January 1, 2026). Notably, the DOL specifically contemplates that this notice will be included with other new-hire and benefit explanation documents, meaning that a separate specific notice for this purpose is not required. Further, the one-time notice is required only if the plan chooses to send the required annual (DC plans) or triennial (DB plans) pension benefit statement electronically under the 2002 safe harbor, rather than mailing it on paper. This proposed change is significant because the “wired-at-work” safe harbor does not currently require plan administrators to give participants the option to opt out of electronic distribution. Plan administrators will need to discuss implementation of this new opt out feature with their third-party recordkeepers. 

For plans using the 2020 “notice and access” safe harbor, the proposed regulations would exclude the newly mandated paper pension benefit statements from the 2020 safe harbor unless the individual affirmatively elects electronic delivery. The 2020 notice and access safe harbor did not previously include an affirmative election requirement, so plan administrators will need to coordinate with their third-party recordkeepers to discuss how to best solicit participant elections for electronic delivery (if desired). In addition, the proposed regulations would require that pension benefit statements (1) describe how to request that such statements be furnished electronically; and (2) include contact information for the plan sponsor, plan administrator or other designated plan representative. Fees for paper benefit statements are prohibited. 

SECURE 2.0 provides that the new paper benefit statement requirement will apply for plan years beginning on or after January 1, 2026. Importantly, however, the DOL has stated it will not take enforcement action against plan administrators that comply in good faith with a reasonable interpretation of the proposed rules. Plan administrators therefore should evaluate their current disclosure practices and assess whether operational changes will be needed for the current and upcoming plan years.

• ERCOT is tightening the large-load interconnection process in response to unprecedented demand, particularly from data centers and other power-intensive digital infrastructure projects. 
• ERCOT’s proposed Batch Zero framework would move large-load interconnections toward a more structured process that gives greater weight to project maturity, readiness, and system impacts. 
• ERCOT has not imposed a blanket freeze on large-load interconnections, but it is already revising study assumptions and adding process controls before the final framework is in place. 
• Projects with credible site control, defined load assumptions, real commercial progress, and a supportable interconnection strategy are likely to be better positioned under the new framework. 
• For developers, sponsors, utilities, and investors, interconnection readiness in Texas is now a front-end development issue, not a downstream technical detail. 

Texas has become a focal point for large-load growth, driven in meaningful part by hyperscale data centers, artificial intelligence infrastructure, and other electricity-intensive digital infrastructure projects. That growth is forcing the Electric Reliability Council of Texas (“ERCOT”) to rethink how large-load interconnection requests are studied, prioritized, and advanced through the system.

ERCOT’s proposed framework (“Batch Zero”) reflects a broader market reality: the historical interconnection process was not designed for the volume, scale, or pace of today’s large-load demand. The issue is no longer whether ERCOT will tighten its approach. ERCOT is already moving toward a more structured, more selective, and more maturity-driven framework for large-load interconnections.

Why ERCOT Is Changing Course

The scale of recent demand is difficult to overstate. ERCOT has reported that it received 225 new large-load interconnection requests in 2025 through mid-November, compared with 152 total requests from 2022 through 2024 combined, and that it was tracking approximately 238.6 GW of large-load interconnection requests as of December 2025. ERCOT also has reported that data-center demand increased 15.5% between January 2025 and January 2026. Those figures help explain why ERCOT has described current request levels as unprecedented and why it has concluded that the historical process is no longer sufficient.

That growth has contributed to repeated restudies, longer timelines, coordination challenges across transmission service providers, and greater pressure to distinguish mature projects from speculative ones.

What Batch Zero Is Designed to Do

ERCOT’s proposed Planning Guide Revision Request 145 (“PGRR145”) would establish a transitional Batch Zero process for qualifying large-load interconnection requests. Although the details remain in development, the proposal points to a more disciplined and coordinated framework for studying large loads.

At a high level, Batch Zero is designed to reduce study inefficiencies, improve consistency across evaluations, create clearer rules for which projects move forward and when, and prioritize projects that demonstrate greater development maturity and commercial commitment. ERCOT is moving away from a less structured first-in, first-studied dynamic and toward a framework that gives greater weight to project readiness, project credibility, and system impacts.

What This Means Right Now

ERCOT has not imposed a blanket freeze on large-load interconnections. It is, however, adding new process controls and revising study assumptions while the broader reform effort is still underway.

For projects in development, the immediate consequence is greater pressure on timing, sequencing, study assumptions, and eligibility. For projects with aggressive energization and ramp-up schedules, that pressure may be commercially significant. ERCOT has indicated that some projects may need to move through process milestones before the full Batch Zero study is complete in order to preserve near-term timelines. Other projects may face longer study timelines, additional restudy exposure, or revised interconnection assumptions as ERCOT continues to assess how large loads interact with transmission constraints and generation availability across the system.

Maturity Is Now a Front-End Issue

One of the clearest themes in ERCOT’s recent materials is the increasing importance of project maturity and commitment. Queue presence alone may no longer be enough. Projects that are better positioned are likely to be those that can substantiate core development elements, including:

• credible site control; 
• defined load characteristics and ramp assumptions; 
• realistic energization timing; 
• meaningful commercial progress; 
• a credible transmission and interconnection strategy supported by early engineering work; and 
• interconnection readiness supported by actual development activity rather than aspirational planning. 

For large-load customers and developers, the lesson is straightforward: readiness is becoming a gating issue. It may affect whether a project is included in a prioritized study cohort and how quickly it moves through the process.

ERCOT Is Not Waiting for the Final Framework

A February 23, 2026 ERCOT market notice concerning the Far West Texas region provides an important signal for the market. In that notice, ERCOT stated that it would not approve certain large-load interconnection studies in specified counties unless those studies included a “no-solar” scenario, and it required certain previously approved studies that had not yet reached later-stage milestones to be updated.

Although the notice applied to a specific region, it shows that ERCOT is willing to modify study assumptions and intervene in ongoing interconnection studies when reliability concerns arise, even before the broader large-load reform framework is finalized. Projects in transmission-constrained areas, or projects relying on aggressive operating assumptions, should expect increased scrutiny.

The PUCT Sequencing Question Still Matters

ERCOT’s reforms are unfolding alongside the broader work of the Public Utility Commission of Texas (“PUCT”) on large-load interconnections. One important open question is whether ERCOT will continue advancing transitional reforms in parallel with the PUCT’s broader rulemaking efforts or whether final implementation will await additional regulatory action.

That sequencing question matters. Moving in parallel may preserve momentum for more mature projects. Waiting for complete regulatory alignment may provide greater long-term clarity, but it could also extend near-term uncertainty for projects already in development.

What Market Participants Should Do Now

As ERCOT’s framework evolves, interconnection readiness should be treated as a front-end strategic issue rather than a downstream technical step. Parties evaluating large-load projects in Texas should:

• test whether a project can satisfy likely maturity criteria; 
• confirm that load assumptions and energization milestones are supportable; 
• assess regional transmission constraints early; 
• evaluate how study timing could affect development schedules; and 
• ensure transaction documents allocate interconnection timing risk and regulatory process uncertainty appropriately. 

For developers, hyperscalers, investors, and other large-load customers, this is no longer simply a technical grid issue. It is now a core development, execution, and siting issue.

Bottom Line

ERCOT’s proposed Batch Zero process is a direct response to a market that has outgrown the assumptions underlying the historical large-load interconnection framework. The direction is clear: ERCOT is tightening the process, and projects that are real, ready, and well-supported should be better positioned than projects that are early, inconsistent, or speculative.

Market participants should act accordingly. In Texas, interconnection strategy now belongs at the front end of project planning.

As we launch the next chapter of the podcast, Zeynep and Kevin sit down with the person who built and led this podcast from the very beginning: Steve Poor, Chair Emeritus of Seyfarth and a longtime industry leader who helped pioneer the application of Lean Six Sigma principles to legal service delivery.

In today's conversation, Kevin, Zeynep, and Steve discuss the evolution of the legal profession and legal tech, how to define "innovation," and the way podcasts promote learning and innovation, among many topics.

Read the full transcript of today's episode here.

Subscribe to be notified via email when new episodes drop. 

You can also listen and subscribe on your favorite platform: 

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Both Cash and Bull recently joined Seyfarth’s Dallas office, where their arrival underscores the firm’s continued strategic growth and expanding influence in one of the nation’s most dynamic legal markets.

Cash, partner in the Corporate department, earned recognition for his mergers & acquisitions practice. He is a trusted advisor to founders, executives, and investors, guiding clients through every stage of the corporate life cycle with a business-focused approach.

Bull, partner in the Real Estate department, was recognized for his environmental law practice. With more than 20 years of experience, he counsels clients to navigate complex environmental regulatory frameworks, delivering practical solutions that align regulatory compliance with business objectives.

McConnell highlighted the compliance challenges created by overlapping legal frameworks, noting:

“You have a well-developed regulatory structure coming from the CCPA side, where the legislature made clear decisions about what triggers potential exposure for companies. It provides very clear direction around what the banners should look like and how you have to interact with the banner, but then you have these overlapping considerations coming from CIPA, the penal code side, that was definitely not drafted with the internet in mind.”

The full article is available here.

Updates at a Glance:

• Temporary Protected Status (TPS) El Salvador: U.S. Citizenship and Immigration Services (USCIS) has updated its TPS El Salvador website to automatically extend work authorization for Employment Authorization Documents (EADs) with a facial expiration date of March 9, 2025 to July 22, 2026
• TPS Yemen (Litigation Update):  On May 1, a federal judge temporarily blocked the Department of Homeland Security from terminating TPS for Yemeni beneficiaries, pausing the May 4 termination.  USCIS has updated its TPS Yemen website noting the EADs issued under the TPS designation of Yemen with an original expiration date of March 3, 2023, September 3, 2024, and March 3, 2026 is extended per court order.
• Form I-9 and E-Verify: E-Verify has issued updated placeholder expiration dates, including Yemen, for several TPS countries affected by litigation stays, which employers should use when completing Forms I-9 and running E-Verify cases.
• TPS Supreme Court Update: On April 29, the Supreme Court heard oral argument in the challenges to DHS’s terminations of TPS for Syria and Haiti. The Court appeared divided on both the threshold question of whether courts have authority to review TPS terminations and the merits of the beneficiaries’ claims. A decision in favor of the government would allow the terminations to take effect immediately. A ruling is expected before the end of the term.

TPS El Salvador EAD Extension

On April 28, USCIS updated its TPS website. It now notes that individuals with TPS-related EADs showing a facial expiration date of March 9, 2025 are authorized to work through July 22, 2026.

USCIS has not posted any additional guidance explaining this update or the reason for the automatically extended date, but employers should be aware of this change and monitor for further clarification.

EAD Automatic Extension Table for El Salvador TPS Beneficiaries

USCIS has also added a table to El Salvador’s TPS page with new EAD expiration dates. Employers should note that only EADs with an expiration date of March 9, 2025 have been automatically extended through July 22, 2026, if these individuals continue to be eligible for TPS. Employers should note that only EADs with an expiration date of March 9, 2025 have been automatically extended through July 22, 2026. All other El Salvador TPS EADs covered by the January 2025 Federal Register notice were extended only through March 9, 2026 a date that has now passed. Those cards are expired and can no longer be accepted as valid work authorization documentation.

Ongoing TPS Litigation

Ongoing TPS Litigation Snapshot: Yemen. On May 1, a federal judge from New York blocked the Department of Homeland Security from terminating TPS protections for more than 2,800 beneficiaries from Yemen. As covered in a previous blog post, Yemen was set to join the growing list of TPS-designated countries by May 4, but the order from the judge paused the termination by the government.

Updates to Form I-9 and E-Verify Guidance. USCIS has also continued to send email alerts and update guidance as litigation challenges the termination of TPS for various countries. As we covered in our prior blog post, E-Verify has been issuing guidance instructing employers to use temporary placeholder dates on Forms I-9 for individuals affected by TPS terminations that are currently stayed by litigation.

As expected, on May 4^th,  USCIS published guidance related to Yemen noting: “When completing the Expiration Date (if any) fields on Form I-9, input “as per court order” in Section 1 and “July 1, 2026” in Section 2 along with a note in the additional information box. Employers may download the Alert and TPS Yemen webpage and attach them to Form I-9. Check USCIS websites regularly for updated information. When completing a case in E-Verify, enter the expiration date of “July 1, 2026” from the Form I-9.”

Again, the dates shared by USCIS are temporary placeholders rather than new work authorization validity periods. In fact, work authorization for all these affected countries continues indefinitely pending litigation.  This is because the courts have stayed the terminations for now and related litigation is pending at the Supreme Court, which heard oral argument on the Syria and Haiti TPS terminations on April 29. A ruling, which could have significant implications for TPS beneficiaries across all affected countries, is expected before the close of the Court’s current term.

Updated Form I-9 Section 2 Placeholder Dates. Recent and prior guidance has included updated placeholder dates for TPS beneficiaries from Burma (Myanmar), Ethiopia, Haiti, Somalia, South Sudan, Syria, Yemen. As of this writing, all countries except for Somalia have dates that extend further into the future. Somalia’s placeholder stands at May 18, 2026.  Employers should continue to closely monitor E-Verify guidance for updates, which may come very close to the upcoming expiration date.

Venezuela.  As previously covered, work authorization for TPS Venezuela beneficiaries has ended, with limited exceptions. Please see our previous blog post from January of 2026 reporting on the Ninth Circuit Court of Appeals decision which had no effect since the Supreme Court, on October 3, 2025, allowed the Secretary Noem’s decision to take immediate effect. TPS beneficiaries who received TPS-related EADs, Forms I-797, Notices of Action, and Forms I-94 issued with October 2, 2026, expiration dates on or before February 5, 2025 will maintain work authorization and their documentation will remain valid until October 2, 2026, pursuant to the U.S. District Court for the Northern District of California’s order dated May 30, 2025. EADs with any other dates are no longer valid.  Notably, E-Verify has begun to issue Final Non Confirmation (FNC) notices for new hires who present work authorization with related expiration dates other than October 2

Current E-Verify Section 2 Placeholder Dates

How to Complete New Hires’ Forms I-9 and Run E-Verify Cases During Court-Ordered Stays

Section 1 (Employee): For the Work Until Date, follow USCIS’s instruction: “as per court order”.

Section 2 (Employer): Enter the placeholder date for the country and add a brief note in the Additional Information box. USCIS does not specify what language to use, but consider noting “TPS-related litigation stay.”

E‑Verify: When prompted for a work authorization expiration date, enter the same placeholder date used in Section 2.

Reminders for Employers

As of this writing, USCIS still has not issued direct, consolidated guidance that addresses how employers should handle reverifications for existing employees with TPS-related work authorization impacted by litigation. As discussed in our previous update, employers may continue to rely on litigation-based extensions and continue to employ individuals who rely on TPS for their work authorizations. Employers may choose to update Section 2 or Supplement B, where applicable, annotate the Additional Information box,  or wait for further guidance and track in some other way.

Regardless of the approach taken, maintaining compliance requires consistent application of the chosen strategy across similarly situated employees, clear documentation supporting the rationale for that approach, and continued monitoring of court activity and USCIS guidance.

For more information contact the authors directly. Seyfarth’s Immigration Compliance & Investigations specialty group is recognized as a national leader in the field. Trusted by Fortune 100 companies and small businesses nationwide, the team provides strategic, practical guidance across the full spectrum of immigration compliance. The group advises on Form I-9 and E-Verify compliance including electronic I-9 matters; ICE inspections and worksite enforcement actions; internal immigration assessments and I-9 audits; DOL immigration-related wage and hour investigations; H-1B/LCA compliance; and DOJ’s IER and OCAHO anti-discrimination matters, including foreign sponsorship “America First” and export control/ITAR issues.

*Selene Malench is a Case Assistant on Seyfarth’s Immigration Compliance & Enforcement team. Many thanks for her contribution to this legal update.

California Constructor featured an article by Jay Houghton, “Building a Digital Defense: Why Owners and Contractors Need Cybercrime Insurance Now More Than Ever.” The piece, published in the magazine's May/June 2026 issue, examines how cyber risks have become a critical concern for owners and contractors as construction operations increasingly rely on digital tools and platforms. 

The lesson from the PocketOS database deletion is not that agentic AI is dangerous. It’s about governance and controls.

You have probably seen some version of the headline by now: “AI Agent Deletes Company’s Entire Database in 9 Seconds.” It is a compelling story. But the headline, while technically accurate, obscures the far more important lesson buried in the details.

So what actually happened? PocketOS, a small SaaS company that makes software for car rental businesses, was using a popular AI-powered code editor running on Anthropic’s Claude Opus 4.6 model. The AI agent was tasked with resolving a routine issue in a staging environment. When it hit a credential mismatch, the agent decided on its own initiative to “fix” the problem by deleting a volume on Railway, the company’s cloud hosting provider. The agent found a password in an unrelated file and used it to execute a deletion command. Because of permissions made available to the agent and the way access to the infrastructure was configured, that single command using a password which was valid across all systems wiped both the production database and all associated backups.  

The agent, when asked to explain itself, produced what multiple outlets described as a “confession,” acknowledging it had violated its own safety instructions. The story has gone viral. The framing in most coverage puts the AI squarely at the center of the narrative: the agent “went rogue,” it “confessed,” it acted autonomously and destroyed a business. But the reports are not entirely accurate and usually miss the point.

The Real Story Is a Cascade of Governance Failures

When you look past the dramatic language and examine the chain of events, what you find is not a story about a rogue AI. It is a story about a series of entirely preventable human and infrastructure failures that, collectively, handed an autonomous tool the keys to the truck without comprehending the destination or even the route to be driven. This is a cybersecurity lesson that could be applied to any technical employee or contractor who attempts (or is allowed to do) a boneheaded shortcut on a Friday afternoon.

Failure 1: Overprivileged credentials. The API permissions token the agent found and used had been created solely for managing website domains. But Railway’s system assigned every API token full permissions across all operations, including destructive ones, with no scoping or restrictions. This is a textbook violation of the principle of least privilege, one of the most fundamental tenets of information security. The agent should never have had the capability to delete production infrastructure in the first place. The same would be true for any other technical employee or contractor.

Failure 2: No confirmation gates for destructive actions. Railway’s API allowed a single unauthenticated command to permanently destroy a production database with no confirmation step, no delay, and no secondary verification. Railway has since added confirmation delays before deletions, which tells you everything you need to know about where this safeguard should have been.

Failure 3: Backups stored alongside production data. Railway kept backups in the same location as the live database, so a single deletion removed both at once. If the same action can erase your primary data and its backups in the same place, you do not have a real backup.

Failure 4: No human-in-the-loop for irreversible operations. The agent’s configuration did not enforce manual approval gates before executing destructive or irreversible commands. For the agent, it was a routine API call with no friction. This may have been the result of over-reliance or hubris on the part of whoever set up the Cursor installation in the first place, but had this agent been a human developer, deleting a production database would usually involve multiple confirmation prompts and a moment of serious deliberation.

Credit Where It Is Due

PocketOS founder Jer Crane, to his credit, did not simply blame the AI – despite what media headlines have attempted to do with the story. Crane’s public post framed the incident as a systemic failure: “This isn’t a story about one bad agent or one bad API. It’s about an entire industry building AI-agent integrations into production infrastructure faster than it’s building the safety architecture to make those integrations safe.” He is right. Media reports also don’t usually mention that the data was eventually recovered, although only after the company endured a 30-plus-hour outage.

The Lesson the Headlines Missed

AI agents do what they are designed to do: optimize for task completion at machine speed. They do not possess judgment about business consequences. In fact, they do not possess judgement at all. They do not instinctively understand that deleting a database is not merely a file operation but a potential extinction-level event for a small company. That is not a flaw unique to Claude or any particular model. It is a characteristic of the technology itself. It is the same thing many of us experience when we notice or uncover a hallucination or other critical error by AI. The AI cheerfully says, “good catch,” or “you were right to call me out on that,” without a second thought about the consequences of the SNAFU.

All of this confirms what we already knew to be true. The responsibility for preventing catastrophic outcomes falls squarely on the governance architecture surrounding these tools. If you are deploying AI agents that can interact with production infrastructure, at a minimum you need:

• Scoped permissions. Tokens and credentials should grant the narrowest access required for the task. If an agent is debugging a staging environment, it should not have the ability to touch production.
• Mandatory human approval for destructive actions. Any operation that is irreversible (deletion, overwrite, schema migration on production) should require explicit human confirmation before execution.
• Infrastructure-level safeguards. Your cloud provider’s API should not allow a single unauthenticated call to permanently destroy data. If it does, that is a risk you need to mitigate before handing an agent the credentials.
• Isolated, immutable backups. Backups that can be destroyed by the same token or API call that destroys primary data offer a false sense of security. Offsite or write-once backups are essential.
• Agent audit logging and kill switches. You should be able to see what your agent is doing in real time and terminate its operations instantly.

None of this is exotic or cutting-edge governance. These are well-established information security and access control principles that predate AI agents by decades. The only thing new here is the speed at which the damage can happen when those principles are not followed.

The Real Lessons Are Governance and Controls

The PocketOS incident is not evidence that AI agents are too dangerous to deploy or that they will eventually destroy the world. Deploying agentic AI without proper governance or controls is dangerous, in the same way that giving any automated system unrestricted access to production infrastructure without safeguards is dangerous. The agent did exactly what an unsupervised, overprivileged technology or developer contractor might do: it moved fast, made a judgment call it was not qualified to make, and caused irreversible harm before anyone could intervene.

Industry’s rush to integrate AI agents into production workflows is real, and the gap between capability and governance is widening. If a lesson is to be drawn from this event, it is from the collective failure to apply basic security and oversight principles to a new and powerful category of tools. If the PocketOS story has a villain, it’s not the AI.

When the California Privacy Protection Agency (“CalPrivacy”) announced a $1.35 million settlement in September 2025 – the largest CCPA penalty to date – one of the itemized grievances stood out for any practitioner who has wrestled with a vendor redline: the company had failed to amend or enter into third-party data protection vendor contracts by regulatory deadlines.

This hints at where state privacy enforcement is heading. The consumer-facing side of privacy compliance – notices, opt-out links, cookie banners – is visible and testable. But the back-end architecture of a compliant privacy program lives at least in part in vendor contracts, and regulators increasingly treat those contracts as evidence of program maturity (or its absence). Nowhere is this more concrete than in California’s 11 CCR § 7051.

The California Baseline: 11 CCR § 7051

Section 7051 of the CCPA regulations sets out nine mandatory terms that every contract with a “service provider” or “contractor” must contain. The regulation isn’t new – it took its current form in March 2023 – but it is now a bright-line compliance artifact that regulators can request and check at any time. If the requirements are not met, the contract is not with a service provider or contractor. Put differently: if the paper isn’t right, the transfer becomes a sale or share. That reclassification cascades into opt-out obligations, notice obligations, and downstream liability. The requirements for a service provider or contractor contract:

1. Prohibit selling or sharing the personal information collected under the contract.
2. Identify the specific business purpose(s) for the processing – “generic” cross-references to the underlying services agreement do not satisfy the regulation.
3. Purpose Limitation. Prohibitthe service provider or contractor from retaining, using, or disclosing the personal information for any purpose other than the specified business purpose(s). This is the basic “stay in your lane” rule: the vendor uses the data only for what the contract authorizes.
4. No-commingling of data. Prohibit the service provider or contractor from using the personal information outside the direct business relationship — including combining or updating it with personal information from other sources or the vendor’s own consumer interactions. Where item (3) limits what the vendor does with the data, this limits what the vendor mixes it with.
5. Require compliance with the CCPA and its regulations, including providing the same level of privacy protection the business is required to provide.
6. Grant the business the right to take reasonable and appropriate steps to ensure CCPA-consistent use of the personal information.
7. Require notice from the service provider or contractor if it can no longer meet its CCPA obligations.
8. Grant the business the right, upon notice, to take reasonable and appropriate steps to stop and remediate unauthorized use.
9. Require the service provider or contractor to enable the business to comply with consumer requests (or require the business to inform them of applicable requests and provide the information necessary for compliance).

Section 7053 extends a parallel regime to “third-party” contracts – entities that receive personal information outside the service-provider/contractor structure.

The regulations expressly tie enforcement of the contract to the business’s ability to defend against liability for a service provider’s noncompliance. A business that never enforces the contract or exercises its audit rights may find its statutory defense unavailable when the regulator comes calling.

What Changed on January 1, 2026

CalPrivacy’s automated decision-making technology (“ADMT”), risk assessment, and cybersecurity audit regulations took effect on January 1, 2026, and they expressly layer new contracting expectations onto § 7051’s baseline. In practice, that means three new categories of vendor cooperation:

• ADMT cooperation. Where a service provider or contractor supports ADMT used to make significant decisions, the contract should address the vendor’s cooperation with the business’s Pre-Use Notice obligations, opt-out and appeal mechanics (including the fifteen-day downstream-notification window for third parties following a post-processing opt-out), and access-request responses under Article 11. Section 7153 separately requires businesses that make ADMT available to other businesses to provide “all facts necessary” to support the deploying business’s risk assessment, which is triggered by a business’s deployment of ADMT tools.
• Risk assessment support. Section 7151 of the regulations contemplates that service providers, contractors, and other external parties, including experts in detecting and mitigating ADMT bias, may be involved in the risk assessment process. Section 7152 then prescribes the operational elements the risk assessment must document, including the categories of recipients (service providers, contractors, and third parties) and the logic, inputs, and outputs of any ADMT used for significant decisions. Vendor contracts need to enable the transfer of information sufficient for the business to complete the assessment, retain it, and submit the required attestation and summary to CalPrivacy.
• Cybersecurity audit cooperation. Section 7123 enumerates the components a qualifying business’s annual cybersecurity audit must address, including oversight of service providers and contractors. Businesses subject to the audit requirement will need contractual visibility into vendor security programs sufficient to support the auditor’s work, including the ability to make relevant information available on request.

The State Patchwork

Section 7051 of the CCPA regulations is the most prescriptive of the comprehensive state privacy regimes, but it is far from alone. The Virginia Consumer Data Protection Act (§ 59.1-579), Colorado Privacy Act (§ 6-1-1305), Connecticut Data Privacy Act (§ 42-520), and most of their successors across the US require written contracts between controllers and processors. The common core across these statutes:

• A statement of processing instructions, nature and purpose, type of personal data, and duration.
• Duty of confidentiality for processor personnel.
• Flow-down of equivalent obligations to subcontractors (typically upon written notice of changes, with a right to object).
• Assistance with data-subject rights requests, data protection assessments, breach notification, and security.
• Audit, inspection, or assessment rights.
• Deletion or return of personal data at the end of the engagement.

The substance overlaps considerably, which is why a well-drafted DPA template can generally cover the controller-processor laws with jurisdiction-specific riders. California remains the outlier – because § 7051 is more prescriptive and because the CCPA uniquely reaches employee personal information unlike the other state laws.

Practical Next Steps

A straightforward ordering for businesses that have not recently touched their vendor paper:

1. Inventory. Identify every vendor that receives or processes personal information on the business’s behalf, and categorize each as a service provider/contractor (California), processor (other state laws), or third party.
2. Conduct a gap assessment on your standard DPA. Compare existing DPA language against the updated requirements.
3. Layer the 2026 obligations. For service providers touching ADMT, risk-assessment-triggering processing, or systems in scope for cybersecurity audits, add cooperation clauses tailored to those regulatory deliverables.
4. Prioritize amendments. Sequence by risk (data sensitivity, volume, regulatory scrutiny).
5. Document enforcement. The audit-rights provision is only as good as its exercise. Build a practical vendor review cadence.

The through-line across all of this is that state privacy law compliance enforcement has expanded focus from notice-heavy to contract-heavy. Regulators read the paper now, and they are treating contract gaps as program gaps. The good news is that § 7051, despite being the most prescriptive of the state regimes, also provides the clearest compliance roadmap. Running it against your vendor inventory is the fastest way to find out whether your paper supports your program.

Edited by John Tomaszewski and Yana Komsitsky

Seyfarth advised Noble on both the acquisition and financing aspects of the transaction, including negotiating and coordinating franchise agreements across multiple brand platforms, structuring the transaction to align with Noble’s disciplined investment strategy, and managing legal execution across numerous jurisdictions.

The portfolio comprises a deliberately diversified mix of leading hospitality brands, featuring seven Marriott‑branded hotels, two Hilton properties, and one IHG property. The assets span the Pacific Northwest, Midwest, Southeast, and Northeast, anchored by complementary demand drivers such as healthcare, higher education, government, logistics, and corporate travel.

“This transaction reflects the scale and sophistication of today’s hospitality investment market,” said Thomas Gryboski, co‑lead attorney on the transaction. “Noble continues to identify opportunities that combine premium brands, geographic diversification, and compelling fundamentals. Seyfarth is proud to support Noble in executing a portfolio acquisition that aligns with its long‑term vision for high‑quality hospitality assets nationwide.”

“Hospitality transactions of this scope require a deep understanding of brands, franchise structures, and the operational realities of hotel ownership,” said Catherine Morgen, co‑lead attorney on the deal. “We collaborated closely with Noble’s experienced investment and asset management teams to deliver a legal framework that supports their strategy and positions the portfolio for continued success.” 

Gryboski and Morgen led the Seyfarth deal team, which included associates Luke Hoover, Ward Smith, and Tucker Sutlive. 

Noble Investment Group is an institutional real estate investment manager focused exclusively on the travel and hospitality sector. With $5 billion in assets under management, Noble serves as a fiduciary to many of the world's leading institutional investors.

Seyfarth’s Real Estate Department is recognized as one of the largest real estate practices in the US, counseling clients on a local, regional, or national basis. The team services sophisticated clients across a number of industries in each of the largest money center markets across the country. Seyfarth uses its size and depth to partner with clients and to invest in material enhancements in how commercial real estate law is practiced.

About Seyfarth

With approximately 1000 lawyers across 17 offices, Seyfarth Shaw LLP provides advisory, litigation, and transactional legal services to clients worldwide. The firm is recognized for its innovative approach to delivering legal services, combining deep industry knowledge with advanced technology and substantive excellence.

Seyfarth partners with clients to solve complex challenges across sectors including corporate, litigation, real estate, regulatory compliance, labor and employment, and executive compensation and other benefits work. Committed to collaboration and client-focused solutions, Seyfarth continues to set the standard for legal service delivery in an evolving global marketplace.

Vallerie had previously been with Seyfarth from 2016 to 2022, the last three as a partner in the Real Estate department. She is the 16th lawyer to return to Seyfarth since the beginning of 2025 and the fifth “boomerang” to do so already in 2026. She spent the intervening years as a partner at McDermott.

Vallerie focuses her practice on complex commercial real estate transactions, where she offers extensive experience representing lenders, borrowers and institutional investors in the acquisition, development, financing, and disposition of commercial real estate as well as the origination and restructuring of mortgage, mezzanine, bridge, and construction financings. She also provides strong experience with inter-creditor arrangements and preferred equity transactions.

“Megan’s return deepens our real estate team in New York and across the firm,” said Paul Mattingly, national chair of Seyfarth’s Real Estate department. “She’s an outstanding real estate attorney with a proven record of leading highly structured and sophisticated transactions for institutional clients. Having worked with her before, we know just how well she fits with our Real Estate group and the depth of experience she brings on both the debt and equity side of deals.”

Vallerie represents capital markets and balance sheet lenders including commercial banks, life insurance companies, debt funds, and other sources of private capital in the origination, restructuring, participation, purchase, and sale of commercial real estate loans.

On the equity side, she represents institutional investors, family offices, developers and operators in the acquisition, disposition, financing, leasing, and development of all types of commercial properties. Her practice also includes representing clients making indirect investments in commercial real estate through joint venture and preferred equity arrangements.

“Megan brings deep transactional experience on high‑stakes real estate deals,” said John Napoli and Marc Gurell, co-managing partners of Seyfarth’s New York office. “Having her on board allows us to expand the work we do with both existing and new clients across the capital stack.”

Before joining Seyfarth the first time, Megan worked in-house at FirstKey Lending, LLC in a transaction management role. At the Cerberus portfolio company, she was responsible for negotiating, structuring, and closing fixed and floating rate loans for CLO and balance sheet execution while working closely with the originations, credit, capital markets, and asset management teams, both prior to and following closings.

“I have maintained strong relationships with my colleagues at Seyfarth over the years while I was gone, staying closely connected through alumni events and have been across the table from them on several deals,” said Vallerie. “Returning to the firm feels like a natural and strategic next step—one that offers the right platform for me to grow and expand my practice while being part of the truly collaborative culture that originally drew me to Seyfarth.”

Vallerie earned her JD from Fordham University School of Law and her BA from UCLA. She frequently moderates panels on commercial real estate finance for Commercial Observer.

About Seyfarth’s Real Estate Department

Seyfarth’s world-class real estate team serves sophisticated clients across a number of industries. Recognized as one of the largest real estate practices in the US, we have built an integrated team that serves local, regional, and national clients on the acquisition, financing, development, leasing, restructuring, servicing, and disposition of noteworthy real estate assets and portfolios. This experience extends across comprehensive array of asset classes, including office, industrial, multifamily, retail, health care, and data center projects. We leverage our size and depth to partner with clients and to invest in material enhancements in how commercial real estate law is practiced.

Seyfarth’s New York office is home to approximately 150 attorneys who provide tailored, business focused counsel across a broad scope of litigation and transactional matters, including financial services, labor and employment, real estate, tax, and more. Our lawyers draw on deep experience advising some of the world’s most sophisticated businesses, paired with strong knowledge of local law and market dynamics and innovative approaches, to serve as strategic partners to regional, national, and global clients, among them many Fortune 500 companies and leading financial institutions across a wide range of key industries.

About Seyfarth Shaw LLP

With approximately 1,000 lawyers across 17 offices, Seyfarth Shaw LLP provides advisory, litigation, and transactional legal services to clients worldwide. The firm has gained widespread recognition for its innovative approach to delivering legal services, combining deep industry knowledge with advanced technology and substantive excellence.

Thursday, May 7, 2026
1:00 p.m. to 2:00 p.m. Eastern
12:00 p.m. to 1:00 p.m. Central
11:00 a.m. to 12:00 p.m. Mountain
10:00 a.m. to 11:00 a.m. Pacific

About the Program

The next session of our 2026 Commercial Litigation Outlook Webinar Series explores one of the most dynamic risk environments facing businesses today: the convergence of antitrust enforcement, consumer class actions, and privacy litigation. As regulators and plaintiffs sharpen their focus on data‑driven strategies, AI‑enabled tools, and digital consumer engagement, companies face growing scrutiny and higher stakes in how technology is deployed and governed.

This session is designed for legal and compliance professionals, in‑house counsel, and business leaders seeking practical guidance on anticipating enforcement trends, reducing exposure, and aligning business practices with emerging legal expectations.

What You’ll Learn:

• Antitrust and merger enforcement trends in 2026, including scrutiny of algorithmic pricing, data sharing, AI‑driven decision‑making, and ongoing aggressive oversight of major transactions and Big Tech.
• Rising consumer class action exposure, including under the Telephone Consumer Protection Act and email, digital marketing and website focused claims, as well as enforcement of arbitration provisions and class action waivers.  
• Privacy enforcement and litigation priorities, with a focus on demonstrating that opt‑outs, consent mechanisms, and disclosures function as promised across websites and mobile applications.
• How AI is reshaping litigation risk, accelerating privacy claims and enforcement activity, and what companies can do now to mitigate that risk.

This timely program underscores how antitrust, privacy, and consumer litigation risks are converging around data and technology. As enforcement expectations continue to shift from written policies to operational proof, attendees will leave with a clearer roadmap for managing compliance, defending claims, and navigating an increasingly aggressive litigation environment.

Speakers

Kristine Argentine, Partner, Seyfarth Shaw LLP
Jason Priebe, Partner, Seyfarth Shaw LLP
Sam Rowley, Partner, Seyfarth Shaw LLP
Daniel Riley, Associate, Seyfarth Shaw LLP

Moderator

Kenneth Wilton, Partner, Seyfarth Shaw LLP

If you have any questions, please contact Sadie Jay at sjay@seyfarth.com and reference this event.

To comply with State CLE Requirements, CLE forms requesting credit in IL or CA must be received before the end of the month in which the program took place. Credit will not be issued for forms received after such date. For all other jurisdictions forms must be submitted within 10 business days of the program taking place or we will not be able to process the request.

Our live programming is accredited for CLE in CA, IL, and NY (for both newly admitted and experienced).  Credit will be applied as requested, but cannot be guaranteed for TX, NJ, GA, NC and WA. The following jurisdictions may accept reciprocal credit with our accredited states, and individuals can use the certificate they receive to gain CLE credit therein: AZ, AR, CT, HI and ME. For all other jurisdictions, a general certificate of attendance and the necessary materials will be issued that can be used for self-application. CLE decisions are made by each local board, and can take up to 12 weeks to process. If you have questions about jurisdictions, please email CLE@seyfarth.com.

Please note that programming under 60 minutes of CLE content is not eligible for credit in GA. programs that are not open to the public are not eligible for credit in NC.

Seyfarth's practice has redefined high-volume retail legal services by embedding generative AI into their workflows. The team serves many of the nation’s top retailers, managing hundreds of matters and new store locations annually.

Through proprietary technology and platforms such as Orbital Copilot and LeasePilot, the Seyfarth team has significantly accelerated lease production while providing clients with unprecedented visibility into their real estate portfolios. This innovative approach has earned Seyfarth industry recognition, including the ACC Value Champions Award for delivering faster, more scalable outcomes for global developers and retailers.

In addition to client work, Seyfarth continues to shape the future of the industry through thought leadership and education, including leading ICSC programs focused on the intersection of AI and real estate law.

“This recognition reflects our commitment to transforming how retail legal services are delivered,” said Eric Greenberg, co-chair of Seyfarth’s Leasing Practice. “By leveraging technology, we are not only increasing efficiency, but also creating greater transparency and strategic value for our clients. We’re proud to partner with leading retailers to help them scale and innovate in an increasingly dynamic market.”

GlobeSt is a leading real estate media company serving the commercial real estate community.

Read more here.

Ersin emphasized why innovation leadership roles have become a stronger pathway for women, noting:

“Women are often well positioned to take a broad view and connect dots across disciplines, in part because many of us have built careers that draw on a wide range of experiences and skill sets. Innovation roles really do reward that kind of cross-pollination.”

The full article is available here.

Tips from Seyfarth is a blog series for employers, and their in-house lawyers and HR, payroll, and compensation professionals, in the food, beverage, and hospitality sector. We curate wage and hour compliance “tips” to keep this busy industry informed.

Seyfarth Synopsis: Effective July 1, 2026, all Florida food establishments must disclose any mandatory fee, not just automatic gratuities, on both the menu and bill.

We here at TIPS have been closely following a newly passed piece of legislation out of Florida relating to disclosure of charges by food establishments. The newly passed bill expands upon an existing statute, F.S.A. § 509.214, requiring public food establishments to disclose automatic gratuities and service charges to customers. The expanded law, which will come into effect on July 1, now requires food establishments to disclose any mandatory “operations charge,” not just automatic gratuities or service fees. The statute defines “operations charge” as an automatic fee or charge other than a tax that a customer is required to pay in addition to the cost of the food or beverage purchased, including—in addition to service charges and automatic gratuities—items such as credit card surcharges and delivery fees. This is a non-exhaustive list.

The statute further requires that the establishment disclose the amount or percentage of the charge and the purpose of the charge. These disclosures must appear on all written contracts, physical and digital menus, applications or websites for placing orders, and the face of the bill provided to the customer. The disclosures must appear in a font equal to or greater than the font used throughout the menu or bill, i.e., no “fine print.” If an establishment does not provide menus, the disclosure must be visible in an “obvious and clearly readable manner” on the menu board or sign near the register. Finally, the receipt must include separate lines for gratuity, operations charges, and sales tax.

Notably, the statute does not include a private right of action. This means that an individual customer cannot bring a lawsuit for an alleged violation of this law. However, employers should be aware that the state government has the authority to impose fines or sanctions for non-compliance.

This development reflects a national trend towards requiring food establishments and other sellers of goods and services to disclose mandatory fees that may impact the total price of a good or service purchased. For example, California, Colorado, Massachusetts, and New York City have all passed such laws targeting hidden fees in the last few years, indicating that more legislation of this nature potentially affecting restaurants’ disclosure of service charges, automatic gratuities, and other mandatory fees could be on the horizon. Stay tuned for our upcoming TIPS post about that growing national trend and its potential implications for restaurant and hospitality employers.

If you are a restaurant or hospitality employer looking for guidance on how to proceed in the wake of these recent developments regarding disclosure of mandatory fees, we encourage you to reach out to us or any member of Seyfarth’s Wage and Hour Litigation Practice Group.

Massachusetts Lawyers Weekly quoted Labor & Employment partner Barry Miller in its article, “New DOL Joint Employer Rule Sparks Split Among Attorneys.” The piece, published on May 3, 2026, examines the US Department of Labor’s proposed four‑factor test for determining joint employer status and the differing reactions from employer‑side and plaintiff attorneys on how the rule could affect workers and businesses.

In a feature article highlighting the honor, Daily Report noted Seyfarth’s creation of dedicated C-suite leadership roles focused on innovation, data, and AI, as well as firmwide initiatives such as the SEYence Fair and the development of AI-powered tools designed to enhance efficiency, insight, and client service.

The full profile is available here (subscription required).

Drawing on three decades of experience, Radmacher authors Chapter 8, Contractor Delay Damages, offering practical insight into one of the most contested issues in construction litigation and arbitration.

Radmacher examines the two forces that drive nearly every construction dispute—time and money—unpacking how delays occur, how costs are measured and allocated, and how parties can strategically assert or defend against delay-related claims. The publication serves as a timely and valuable resource for industry practitioners and their counsel navigating the legal and financial consequences of project delays. 

Pre-order the book here.

Drawing on market data, Delaware case law, and a practical hypothetical, the piece highlights why careful drafting of fraud definitions is critical to preserving the parties’ negotiated allocation of risk. Lucano outlines best practices for sellers to limit fraud carve‑outs to intentional misconduct, contractual representations, and designated individuals with actual knowledge.

As Lucano emphasizes:

“Sellers should define fraud to require actual knowledge of falsity and intent to deceive, rather than recklessness, negligence or constructive knowledge.”

The full article is available here (subscription required).

The article analyzes a recent decision from the US District Court for the Southern District of New York holding that AI-generated research prompts and responses may not be protected by attorney-client privilege or the work product doctrine. The authors highlight how routine use of publicly accessible AI tools can expose sensitive legal strategy to discovery and create unforeseen litigation risks for both in-house counsel and their organizations.

Kappelman and Piaget caution:

“There can be no reasonable expectation of confidentiality when a non-attorney uses publicly accessible AI software and the output of such a search is not protected by the attorney-client privilege.”

The full article is available here (subscription required).

In a Q&A with Daily Report, Cherney described stepping into a lead role during preparation for a high‑stakes collective action trial, noting:

“I intentionally chose complex, high-impact witnesses whose testimony was critical to the defense. That decision required me to take full ownership of the preparation process, from mastering the evidentiary record and factual nuances, to anticipating cross-examination strategies, preparing rebuttal themes, and aligning witness testimony with the broader trial narrative.”

She further emphasized how the experience shaped her development as a trial lawyer, explaining:

“This experience reinforced my commitment to trial advocacy and affirmed the value of taking initiative, seeking mentorship, and fully investing in opportunities to grow through responsibility.” 

Read the full feature here (subscription required).

• Business closings or mass layoffs affecting 100+ non-“part-time” employees at a single site of employment may trigger notice obligations.
• Employers must provide 90 days’ advance notice, rather than the 60-day notice requirements of federal WARN.
• Greater detail is required in Nebraska WARN notices, including the names and addresses of affected employees.
• Employers should review the new law to ensure compliance by its effective date on July 18, 2026.
• A civil fine of $100 per day for each day of a violation is the exclusive remedy.

On April 14, 2026, Nebraska’s Governor approved Legislative Bill 921, enacting the Nebraska Worker Adjustment and Retraining Notification Act (“Nebraska WARN”). While the new law borrows concepts from federal WARN, Nebraska WARN expands on the federal statute in notable ways such as requiring a longer notice period, imposing different trigger thresholds, and requiring greater detail in WARN notices.

Covered Nebraska employers with 100 or more non-“part-time” employees must now provide 90 days’ written notice to affected employees (or their bargaining representative) and the Nebraska Department of Labor before implementing a “mass layoff” or “business closing.” This is 30 days longer than the 60-day notice period mandated by federal WARN for a covered event. However, under Nebraska WARN, if a collective bargaining agreement specifies a different notice period then that contractual period will control.

Different Trigger Thresholds Under Nebraska WARN

Nebraska WARN generally tracks the federal WARN concepts of business closings and mass layoffs, but applies them at different thresholds. A covered “business closing” or “mass layoff” may be triggered by an employment loss affecting 100 or more non-“part-time” employees at a single site of employment during a 30‑day period, or in certain instances over a 90-day period.

Like federal WARN, Nebraska WARN may be triggered by the closure of “one or more facilities or operating units” at a single site of employment (in other words, partial closures impacting the threshold number of employees) involving sufficient employment losses.

With regard to “mass layoffs” that are not “business closings,” while Nebraska WARN’s 100-employee threshold is higher than federal WARN’s 50-employee threshold, Nebraska WARN does not include the federal WARN requirement that those losses also constitute at least 33% of the non-“part-time” workforce at a single site of employment.

As with federal WARN, only employment losses for non-“part-time” employees are counted to determine whether there is a covered Nebraska WARN event. Nebraska WARN’s definition of a “part-time” employee is similar to federal WARN’s, other than if a collective bargaining agreement contains a different definition, the labor agreement’s definition governs:

"Part-time employee" means an employee "who is employed for an average of fewer than twenty hours per week or an employee, including a full-time employee, who has been employed for fewer than six of the twelve months preceding the date on which notice is required. However, if an applicable collective bargaining agreement defines a part-time employee, such definition shall supersede the definition in this subdivision[.]"

Similar to federal WARN, although non-“part-time” employees are not counted in assessing whether Nebraska WARN is triggered, if it is triggered, part-time employees also are entitled to advance notice under the statute.

The definition of “employment loss” under Nebraska WARN is similar to federal WARN in that it excludes employment losses such as voluntary separations and discharges for cause, as well as exceptions for certain relocations where comparable employment is offered within a reasonable commuting distance.

Similarly, like federal WARN, Nebraska WARN recognizes three limited exceptions to the advance notice requirement: (1) a faltering company (applicable only to business closings); (2) unforeseeable business circumstances; and (3) natural disasters, such as floods, earthquakes, droughts, storms, tornadoes, or other similar effects of nature, occurring at the time the 90‑day notice would otherwise be required. In each instance, when notice is ultimately given, the employer must provide an explanation for reducing the notice period.

Nebraska WARN’s Distinct 90‑Day Aggregation Period

Like federal WARN, the Nebraska statute also contains a 90-day aggregation period—but it appears to be structured differently. Section 4(2)(b) of Nebraska WARN provides:

An employer shall give notice if the number of employment losses of two or more actions in any ninety-day period triggers the notice requirements in section 3 of this act for a business closing or a mass layoff. An employer is not required to give notice if the number of employment losses from one action in a thirty-day period does not meet the requirements of section 3 of this act. All employment losses in any ninety-day period shall be aggregated to trigger the notice requirement unless the employer demonstrates to the department that the employment losses during the ninety-day period are the result of separate and distinct actions and causes.

In other words, under Nebraska WARN, it appears that an employer is only required to aggregate actions over a 90-day period if one of those actions by itself triggers Nebraska WARN (i.e., impacts 100 or more employees in a 30-day period).

In contrast, under federal WARN, only those actions below the minimum WARN thresholds (i.e., 50 employees constituting 33% of the workforce for mass layoffs, and 50 employees for closures) are aggregated over a 90-day period:

For purposes of this section, in determining whether a plant closing or mass layoff has occurred or will occur, employment losses for 2 or more groups at a single site of employment, each of which is less than the minimum number of employees specified in section 2101(a)(2) or (3) of this title but which in the aggregate exceed that minimum number, and which occur within any 90-day period shall be considered to be a plant closing or mass layoff unless the employer demonstrates that the employment losses are the result of separate and distinct actions and causes and are not an attempt by the employer to evade the requirements of this chapter.

Expanded Nebraska WARN Notice Content Requirements

Nebraska also expands what employers must include in their WARN notices to employees (or their representatives) and the Nebraska Department of Labor. In addition to the federal requirements, Nebraska WARN notices must include:

• The names and job titles of affected employees;
• The addresses of affected employees must be included in the notice to the Nebraska Department of Labor (which must maintain confidentiality of the names and addresses);
• Copies of employee handbooks and employment‑related policies applicable to affected employees, or a written statement providing employees with instructions for unrestricted access to those materials up until the expected date of the first employment loss.

Employers must also post the employee WARN notice in a conspicuous location in the languages spoken by at least five percent of the workforce.

Enforcement and Penalties under Nebraska WARN

Nebraska WARN does not create a private right of action. Enforcement authority rests exclusively with the Nebraska Department of Labor, and the statute provides for a civil penalty of up to $100 per day for violations of section 3 (which, interestingly, does not encompass the 90-day aggregation period set forth in section 4(2)(b) of the act). Nebraska WARN states that this penalty is the exclusive remedy, and courts are expressly prohibited from enjoining a business closing or mass layoff. The statute does permit employers to offset the notice period through severance or wages paid in lieu of notice, so long as the payments are equivalent to the employee’s regular pay during the notice period.

What Employers Should Do Now

Nebraska WARN was approved by the Governor on April 14, 2026, and becomes effective on July 18, 2026. The Nebraska Department of Labor has authority to adopt and promulgate rules and regulations to carry out Nebraska WARN, which would inform interpretation of the new law.

Nebraska’s WARN-type law adds to the increasingly complex web of state legislation restricting workforce reductions. Advance planning is critical to avoiding unexpected penalties and operational disruption. Some steps that employers can proactively take include:

• Confirm employee headcounts attributable to their Nebraska worksites;
• Evaluate planned or rolling layoffs under the 30-day and 90‑day aggregation periods;
• Adjust employment separation planning to account for 90-day notice obligations; and
• Ensure notice templates and posting procedures meet Nebraska’s expanded notice content requirements.

To ensure compliance and reduce risk, we recommend reaching out to a Seyfarth attorney for guidance tailored to your organization.

Seyfarth Synopsis: Accommodation is not a free pass from discipline or termination. In Lewis v. Indiana Department of Transportation, No. 25-1776 (7th Cir. April 22, 2026), the Seventh Circuit reaffirmed that employers do not violate federal anti‑discrimination laws when they terminate an employee with a disability, provided they do so for legitimate performance and conduct‑related reasons. Even where an employer approves a requested accommodation, employees remain responsible for performing the essential functions of their jobs and meeting workplace expectations. The court’s decision is especially instructive for employers managing remote‑work accommodations, where flexibility and accountability often collide.

Background and Remote-Work Accommodation

Keisha Lewis worked for the Indiana Department of Transportation’s Real Estate Division from 2014 until her termination in December 2022. Her position involved reviewing and approving federal relocation vouchers, which was work that directly affected INDOT’s ability to meet project deadlines and maintain federal funding. Lewis suffers from a kidney condition and, following the agency’s return to in‑office operations after the COVID‑19 pandemic, requested to continue working remotely due to her compromised immune system.

INDOT granted Lewis a remote‑work accommodation. In addition to allowing her to work from home, the accommodation included flexibility around exchanging physical paperwork, such as permitting Lewis to meet supervisors outside the downtown office to drop off processed checks. At several points, INDOT also worked with Lewis on documentation issues related to her accommodation and ultimately confirmed that she did not need to continually re‑justify her request.

Put simply, this was not a case where an employer denied an accommodation request or immediately rushed to discipline after one was made. INDOT granted the accommodation and attempted to manage Lewis’s performance within that framework.

Performance Issues Persist Despite the Accommodation

Problems arose, however, once Lewis was working remotely. According to the summary judgment record, Lewis began refusing to perform certain aspects of her job, including processing vouchers for the Finance Department, despite being directed to continue that work. At one point, she emailed a manager outside her chain of command to say she would no longer assist with relocation vouchers at all.

Supervisors also became concerned about Lewis’s productivity and transparency. She developed a significant backlog of unfinished work, initially estimated at 100 to 150 parcels. When supervisors attempted to monitor her workload through regular check‑ins and requested reports detailing her outstanding assignments, Lewis resisted those requests and, in some instances, refused outright to provide the information. She also repeatedly arrived late to meetings or missed them altogether.

When managers attempted to understand what Lewis was working while working remotely, they discovered that the backlog was far larger than initially believed. A report compiled shortly before the termination of her employment showed the backlog to include more than 400 outstanding parcels, including work tied to some of INDOT’s largest projects. Management determined that the delays were placing federal funding at risk and required significant time and expense to remedy.

Throughout this period, INDOT documented concerns related to Lewis’s performance, refusal to follow instructions, and workplace conduct. By December 2022, INDOT concluded that her continued employment was no longer sustainable and terminated her for poor performance and insubordination.

Disability Discrimination Under the Rehabilitation Act

Lewis alleged that her termination violated Section 504 of the Rehabilitation Act. The Seventh Circuit emphasized that this statute imposes a demanding causation standard. Unlike claims under the ADA, a plaintiff must show that the adverse employment action occurred solely because of the employee’s disability.

That standard proved fatal to Lewis’ claim. The undisputed record showed multiple legitimate reasons for her termination, including persistent performance deficiencies and insubordinate conduct unrelated to her medical condition. Lewis also did not dispute that the decisionmaker recommended termination based on those issues. Because her disability was not the sole reason for her termination, the Court held no reasonable jury could find in her favor.

No Evidence of Pretext or Retaliation

Lewis argued that INDOT’s stated reasons were a pretext and that increased monitoring after she began working remotely showed discriminatory or retaliatory intent. The Seventh Circuit rejected that argument, reiterating that pretext requires evidence that an employer did not honestly believe the reasons it gave. Disagreements about management style or the level of oversight do not suffice to establish pretext.

Here, INDOT consistently cited specific, documented concerns about Lewis’s productivity, her refusal to complete assigned work, and her resistance to supervision. The court emphasized that it does not second‑guess an employer’s business judgment where there is no evidence the proffered reasons were dishonest.

Lewis’s retaliation claims under both the Rehabilitation Act and Title VII failed for similar reasons. Although requesting an accommodation and filing internal complaints are protected activities, INDOT articulated legitimate, non‑retaliatory reasons for terminating her employment. The court found no evidence of a causal link between Lewis’s protected activity and her termination, and it noted that poor performance and insubordination are not protected conduct.

Key Takeaways for Employers

For employers navigating remote‑work and accommodation requests, the Lewis decision offers a familiar and reassuring message: granting an accommodation does not mean abandoning performance standards or tolerating an employee’s refusal to perform essential duties. Employers may continue to monitor productivity, request reasonable accountability measures, and take corrective action when expectations are not met, even where an employee is working remotely for medical reasons.

The decision also underscores the value of consistent documentation and clear communication. INDOT’s ability to show that it granted accommodations, addressed concerns as they arose, and relied on well‑documented performance failures was central to its success. Courts will not convert accommodation discussions into immunity from discipline where employers can demonstrate honest, well‑supported reasons for their decisions.

For questions regarding potential impact or compliance considerations, please contact the authors of this post or your Seyfarth attorney.

Welcome back to The Week in Weed, your Friday look at what’s happening in the world of legalized marijuana. This week, the DEA has set up a website for medical marijuana applications. The IRS plans to offer tax guidance for state-legal medical cannabis companies. Various states are reacting to rescheduling. And finally, Gavin Newsom has some advice for the President.

DEA APPLICATIONS

If you own a medical marijuana business that’s licensed by your state, you can now register with the Drug Enforcement Administration (DEA) for federal protection. The agency’s Medical Marijuana Dispensary Registration Portal is up and running. Be prepared to spend some time on this – it’s not a short form, and it requires quite a bit of information on all aspects of your business.

IRS GUIDANCE

Meanwhile, over at the Internal Revenue Service (IRS), they’re getting ready to issue guidance on the tax implications of rescheduling. Think 280E relief for state-licensed medical marijuana businesses. Of course, it’s complicated – for more on just how complicated, check out the latest Cannabis Musings substack.

STATE REACTIONS

So how is all of this playing out in the states? In Tennessee, the governor just signed a new law that would prevent the state from following the federal government’s lead in rescheduling. Prior to last week, state agencies could align a drug’s control status within the state with federal law. Now, it will take an act of the Legislature to do that. Breath-holding not advised.

In Iowa, on the other hand, one of the candidates for governor is proposing to legalize adult-use. Rob Sand, the only Democrat in the race, sees tax revenue from cannabis as a way to close the state’s large budget deficit. He also notes the various other options in neighboring states for those who wish to partake.

AND FINALLY

The White House recently issued an executive order urging federal agencies to take action on approving the use of psychedelics for the treatment of mental illness. California Governor Gavin Newsom (D) had a thought about that.

Be well everyone – we’ll be off next week, but back with more news on May 15.

Read more here.

The article highlights findings from the 2026 Edelman Trust Barometer and The Conference Board’s C‑Suite Outlook, underscoring why employers are now the most trusted institution globally – and the organizational obligations that trust creates. It explores how decisions around AI deployment, advancement and access, and compensation can either strengthen or erode trust. The article offers concrete C-suite guidance on transparent communication, structured decision systems, and manager capability as practical levers of trust management that support engagement, innovation, and long‑term performance.

The article notes:

“Technical capability without organizational trust produces tools that sit unused, concerns that go unvoiced, and errors that go unreported. It also drives workers to external AI systems where containment of corporate IP might be compromised...Thoughtful employers understand the feedback loop between trust and quality.”

The full article is available here (subscription required).

Seyfarth government contracts lawyers Ken Kanzawa and Ashton Jones-Doherty discuss CICA stays, overrides, and the Federal Circuit’s April 15, 2026 decision in Life Science Logistics, LLC v. United States, which held that protesters need not prove the equitable relief factors to reinstate a CICA stay.

The article highlights recent EEOC enforcement activity, including litigation centered on scheduling and other accommodation requests, and offers practical guidance for employers seeking to build compliant, consistent, and defensible religious accommodation programs. Solowey and Steinberg outline key policy, training, and process considerations to help organizations reduce litigation risk while supporting a culture of inclusion.

As the authors note:

“With modest, but strategic, investments in time and planning, any employer can build a compliant religious accommodations program that contributes to a culture of belonging for employees of any or no faith, while reducing the chance of litigation and providing strong defenses in the event of any lawsuit.”

The full article is available here.

New York 421 a(16) Tax Abatement Update
Chris Manzer (Atlanta)

The group discussed recent transactional considerations under New York’s 421 a(16) property tax abatement program, with particular focus on construction completion deadlines. Projects relying on 421 a(16) benefits must generally achieve completion in the relatively near future, or risk losing eligibility for the abatement, making timing a critical diligence issue for both lenders and borrowers in multifamily financings.

A statutory extension is available to certain projects that filed a letter of intent in 2024, which can extend the completion deadline by up to five years. However, use of this extension requires compliance with more restrictive affordability options and eliminates certain owner favorable affordability structures. There are also practical challenges in changing affordability elections once rent schedules and marketing notices have been filed, underscoring the need for careful coordination among legal, tax, and development teams early in the process.

New York Building Loan Agreement and Notice of Lending Recording Requirements
Luke Teresi (New York) and Ben Nitzani (New York)

We discussed the evolving filing requirements for building loan agreements and notices of lending across the five boroughs. Certain clerks’ offices have increasingly taken the position, though not always consistently enforced, that documents executed by an “authorized signatory” alone may be rejected unless the signatory is identified as a member, manager, or equivalent role expressly authorized under the borrower or lender entity’s governing documents.

This development is particularly significant given New York lien law requirements, including strict deadlines for filing building loan agreements and modifications. Failure to timely record or file, as applicable, compliant documents may adversely impact lien priority.

Recent Client Facing AI and Technology Trainings
Dan Evans (New York)

The group discussed the firm’s recent client‑facing AI training and educational programs, which focused on practical uses of AI in legal and transactional workflows. These sessions are designed to help clients better understand emerging tools, real‑world applications, and related governance considerations. The firm continues to invest in AI capabilities and training resources to support clients as AI adoption and expectations around AI fluency continue to mature.

Overall, this session has brought a flurry of new laws, expanding obligations and risks for employers, reminiscent of 2020.  Those laws that have been approved by the Governor will have an effective date of July 1, 2026, requiring employers to review employment agreements and policies in advance of that date to ensure compliance.  In addition to the laws below, Virgina has passed a comprehensive paid family and medical leave law, and is expected to pass paid sick leave as well.  Stay tuned for further alerts detailing the key aspects and timeline for implementation of those paid leave laws.

Wage Transparency Requirements and Salary History Limitations. Virginia passed SB 215/HB 636, imposing new wage disclosure requirements and limiting the use of salary and wage history in employment decisions.  Specifically, employers are prohibited from (1) asking an applicant about their current or prior wages or salary; (2) relying on salary history when deciding whether to interview, hire, or promote an individual; (3) using salary history to determine starting pay unless the employee voluntarily discloses it; and (4) retaliating against or refusing to hire an applicant for declining to provide salary history or requesting a wage or salary range.  Additionally, if an applicant voluntarily discloses salary history, an employer may only rely on that information to justify paying the applicant more than the original offer.

Employers must also disclose the wage or salary range for a position in each public and internal job posting for new hires, promotions, transfers, or other employment opportunities.  These ranges must be set in “good faith” – determined by reference to one or more legitimate factors including an existing pay scale, a previously determined range for the role, the actual pay range for employees currently in comparable positions or the budgeted amount for the position.  Excessively broad ranges may be challenged as failing to meet this good faith requirement.

Actions alleging violations of this law may be brought by the Attorney General or by an aggrieved prospective employee.  Failure to comply with these obligations may subject employers to civil penalties up to $1,000 for the first violation and up to $5,000 for any subsequent violation.  Claims must be brought within one year of the alleged violation of the prospective employee’s rights. Successful claimants may recover actual damages and other legal or equitable relief the Court deems appropriate.

However, employers will be able to avoid these enforcement actions in certain circumstances through timely action.  Employers are entitled to an opportunity to cure alleged violations of (1) the failure to disclose a wage or salary range or (2) the alleged failure to set such a range in good faith.  Any person – not just a prospective employee – may provide written notice to the employer of non-compliance with these requirements.  After receipt of such notice, an employer has 15 days to cure any defects in its posting.  If timely corrections are made, the employer is not subject to enforcement measures or penalites for the alleged violation.  Notably, “notice” is deemed effective for the life of the posting and prospective employees seeking to sue employers for failing to properly disclose salary and wage ranges in job postings may rely on another individual’s written notice of a noncompliant job posting to satisfy the cure notice requirement when suing an employer for failing to post wage ranges.

Expansion of Liability under Virginia’s Wage Statutes:  The Governor has signed an amended version of HB 238, a comprehensive restructuring of the Commonwealth’s wage and hour, misclassification, prevailing wage, and overtime statutes. Under HB 238, the definition of “employer” is expanded across multiple statutes to include any person acting directly or indirectly in the interest of an employer, thereby aligning employer definitions across the minimum wage, wage payment, overtime, and misclassification laws. It also added a new definition of “wages” to include hourly wages, legally required prevailing wages, piece rate wages, day rates, salaries, overtime wages, commissions, tips, bonuses, and damages due to misclassification. HB 238 also amends Va. Code § 40.1-29 to require employers to keep paystubs for a minimum of 3 years.

At the same time, the law enhances remedies available to misclassified workers and minimum wage claimants by authorizing liquidated and treble damages, lengthening the statute of limitations to three years, and allowing collective action mechanisms, significantly increasing potential liability by combining expanded damages with longer look back periods and aggregated claims. It also grants the Labor Commissioner new authority to initiate enforcement actions without receiving a written complaint from an employee and to seek restitution, damages, and statutory penalties either through administrative proceedings or by referral to the Attorney General.

HB 238 also strengthens public works prevailing wage requirements by mandating on site posting of prevailing wage rates, six year retention of payroll and classification records, and sworn pay scale certifications by contractors. Perhaps most significantly for the construction industry, the law expands joint and several liability for general contractors by narrowing the availability of the “knew or should have known” defense and increasing the circumstances under which a general contractor may be held responsible for a subcontractor’s wage violations. Although a knowledge-based standard formally remains, the practical effect is broader exposure to wage liability on covered construction projects.

New Restrictive Covenant Prohibitions.  Governor Spanberger approved legislation (SB 170) preventing employers from enforcing restrictive covenants (e.g., non-competition agreements, customer non-solicitation agreements, employee non-solicitation agreements) against any employees that the employer discharged, unless the employer pays the employee “severance benefits or other monetary payment.” The law provides an exception if the employee is terminated “for cause” or if the employee resigns.

Employers must disclose such “severance benefits or other monetary payment” to the employee at the time of executing the restrictive covenant. These changes will only apply to restrictive covenants entered into, amended, or renewed on or after July 1, 2026; previously-executed agreements will be grandfathered in without these requirements. Virginia employers should review their existing restrictive covenant agreements and determine if any changes may be necessary and, if so, should evaluate whether to roll out new agreements prior to the July 1^steffective date of the revised statute.

The Virginia legislature passed one other restrictive covenant-related bill (HB 627 and SB 128) limiting to the use of restrictive covenants with “health care professionals,” i.e., “any person licensed, registered, or certified by the Board of Medicine, Nursing, Counseling, Optometry, Psychology, or Social Work.” As described in our prior alert, this bill would prohibit the use of most restrictive covenants with such health care professionals, with certain limited exceptions:

• Restrictive covenants with health care professionals when executed in connection with the sale of the health care business (or a division or subsidiary), provided that the restrictive covenant is reasonable in scope, duration, and geographic area;
• Restrictive covenants requiring repayment of (a) recruitment-related costs (relocation expenses, signing/retention bonuses, and other replacement costs), and (b) recruiting, education, or training expenses from departing health care professionals who were employed for fewer than five years;
• Patient non-solicitation covenants, prohibiting health care professionals from soliciting or attempting to solicit patients with whom the worker had “material contact” during employment for purposes of providing substantially similar products or treatment to those patients, provided that the non-solicitation covenant allows the worker to disclose to such patients (1) the worker’s continuing practice of medicine, (2) the worker’s new contact information, and (3) the patient’s right to choose a health care professional.

To date, Governor Spanberger has yet to sign the amended bill, although we expect her to do so shortly, as the legislature adopted a version mostly implementing her recommended changes to the prior bill. Assuming the Governor signs this bill, it would apply to any patient non-solicitation covenants entered into or renewed on or after July 1, 2026, meaning that bills executed before July 1st are grandfathered in under the more relaxed prior statutory scheme.

Minimum Wage Increases:  With the passage of HB 1 and SB 1, Virginia’s minimum wage will increase from $12.77 per hour in 2026, to $13.75 per hour in 2027, and to $15.00 per hour in 2028. Thereafter, minimum wage will increase annually based on increases to the consumer price index.

Voluntary Emergency Responder Protections Implemented:  Virginia will now prohibit an employer from discriminating or retaliating against an employee “solely” because the employee is absent from work due to responding to an emergency or during a state of emergency while acting in the capacity as a volunteer emergency responder.  As set forth in SB 100, “volunteer emergency responder” includes active members or a volunteer fire department of volunteer emergency medical services agency or unit.  Employers may require that an employee provide a certification of service upon returning to work.  Employers are not required to pay employees for time missed due to service as a volunteer emergency responder but must permit employees to use any accrued paid leave for those absences.  There is a limited exception to these protections for those deemed “essential employees” by statute or contract.  Employees may bring a private action within one year of any alleged violation to seek an injunction, reinstatement, or lost wages, reasonable attorney fees and costs. 

New Child Labor Requirements: Governor Spanberger also signed SB 10 and HB 275 updating Virginia’s child labor and apprenticeship law. Specifically, this law maintains the existing prohibition on individuals under 18 working in occupations deemed hazardous by Virginia’s Commissioner of Labor and Industry, but also prohibits working in occupations deemed hazardous by the U.S. Secretary of Labor. Additionally, the law imposes new requirements for employers hiring children 16 years or older in apprenticeship programs or other work-training programs relating to culinary arts or information technology.

Virginia Human Rights Act Changes Remain Unclear: Unlike the laws described above, two pieces of legislation that would result in notable changes to the Virginia Human Rights Act remain in flux.

The General Assembly passed a bill (HB 925) that would increase the statute of limitations for filing a charge of discrimination in employment under the Virginia Human Rights Act from 300 days to two years.  The Governor did not sign that version of the legislation and recommended that the time period for filing a charge only be increased to one year, marking a significant reduction in the proposal. 

The General Assembly also passed a bill (HB 1173/SB 258) to include menopause and perimenopause as protected categories under the Virginia Human Rights Act, prohibiting discrimination on those bases and requiring employers to make accommodations for these conditions.  However, the Governor did not approve that version of the bill and instead recommended that a study be conducted by January 1, 2028, evaluating various aspects of menopause and perimenopause in the workforce, including best practices for providing accommodations in an employment environment.

Neither of the Governor’s recommendations for these Virginia Human Rights Act bills were voted on by the General Assembly and thus the bills will be returned to the Governor in their original form for her signature or veto.

Employer Takeaways:  Employers should review their employment agreements, restrictive covenants, application materials and policies to ensure compliance before July 1, 2026, and verify that outdated templates are removed from circulation.   Employers should also ensure managers and human resources professionals are trained on these new laws, along with those requirements already in effect, as a preventative measure to avoid potential liability given the significant expansion of enforcement mechanisms and liability risks throughout these new employment laws.

The article highlights a successful year for the firm, marked by disciplined growth, notable transactions, increased profits per partner, and a strong foundation for continued momentum. It underscores how Seyfarth’s focus on strategy, client value, and operational strength contributed to improved profitability and overall financial health in 2025.

Almon explained that the firm’s strong performance reflects a long‑term focus on clients and talent rather than any single financial milestone. “I think you focus on your clients and your talent, the revenue just follows,” she said.

She pointed to the firm’s deepening client relationships as a key driver of its success. “So, what I think you’re seeing in terms of the modest, but real, progression of number of clients having a bigger influence on the whole portfolio is just because clients are deepening their trust in us and we’re providing a broader array [of services],” she said.

Almon, addressing how the firm delivers value, highlighted the role of technology and innovation. “We have these unique work capabilities because of AI and innovative tools and solutions, and we believe at core that clients are focused on value and delivery, and billable hours don’t necessarily equate to value.”

Looking ahead, Almon expressed optimism despite broader economic uncertainty. “Lawyers guide people through tumultuous times. Clients are facing enormous complexity and the types of problems that need to be solved, so the leaders and I at Seyfarth are really focused on how we are developing talent to meet the moment.”

The full article is available here (subscription required).

Evans, with more than two decades of experience at Seyfarth, is widely recognized as a trusted advisor to institutional lenders, private equity firms, and other real estate market participants navigating complex and evolving transactions.

In its profile, the NYREJ spotlighted Evans' ability to lead clients through market volatility, his commitment to mentorship, and his forward-looking approach to integrating technology into real estate finance.

Reflecting on leadership during recent industry challenges, Evans shared:

“I learned that leadership in those moments is less about having all the answers and more about being present and pragmatic. Staying accessible to clients and helping teams focus on solutions allowed us to keep moving forward when traditional approaches no longer fit the market.”

The feature further underscored Evans' pride in helping clients modernize and scale their lending platforms:

“By designing standardized workflows, leveraging SeyfarthLink for real-time deal tracking, and integrating AI for diligence and document review, we materially reduced closing timelines and increased consistency across high-volume programs, allowing clients to deploy capital more efficiently in a challenging market.”

Read the full Q&A here.

Weiss explained that companies are streamlining top leadership to create more consistency and efficiency, but cautioned that consolidation can sometimes create misalignments, such as entire departments reporting to leaders unfamiliar with their functions.

He advised organizations to carefully evaluate their business functions to determine where consolidation makes the most sense, noting that outcomes will vary by role and industry. Weiss also emphasized the importance of upskilling executives to help them expand their abilities and succeed in expanded leadership roles.

The full discussion can be heard at the 6:38 mark of the episode, "Noon Business Lunch 4/28/26: Resilient consumer, labor market fragility, new job tips."

Law360 quoted Diane Dygert, chair of Seyfarth's Employee Benefits department, in its article, “Attys Want To See Examples In New Mental Health Parity Rule.” The piece, published on April 28, 2026, examines the uncertainty surrounding forthcoming federal mental health parity regulations and what plan sponsors hope to see from regulators.

Dygert discussed the challenges plan sponsors face in navigating mental health parity compliance amid shifting enforcement priorities, emphasizing the need for clearer, more practical guidance from regulators. She also noted unresolved questions about how parity requirements apply to coverage decisions involving gender-affirming care, an area where employers continue to seek clarity.

The full article is available here.

As fearsome as Godzilla has proven to be over the decades, the indomitable kaiju may have found its foil in Japanese copyright law.  A Tokyo court recently found several individuals guilty of violating Japanese law for publishing spoiler-heavy posts, including in relation to a recent Godzilla movie, on an entertainment review website.  The penalty for one of the individuals?  An 18-month jail sentence and a stiff monetary fine (equivalent to over $6,000 U.S.) according to press reports.

The case arose based upon complaints brought by a Japanese trade group, Content Overseas Distribution Association (CODA) on behalf of the owners of the IP rights to Godzilla and an anime series called Overlord, Toho Co., Ltd. and Kadokawa Corporation.  Police investigated and ultimately arrested the individuals behind the website and posts, including the apparent website owner Wataru Takeuchi.  Japanese prosecutors brought a criminal case, overseen by Tokyo District Court Judge Jun Shimato.  On April 16, 2026, Judge Shimato found that the descriptions of the scenes, plots, and elements of the entertainment being “reviewed” in the posts on the website in question went beyond mere “fair use” of the elements of the works. 

Copyright laws in most countries—including the United States—allow certain descriptions of films, TV shows, and other works, which might otherwise be considered infringing, if the author is writing a commentary on, or review of, the works.  In this case, however, Japanese prosecutors argued that the posts on the website in question contained so much detail that they crossed over from mere commentary to being an unauthorized adaptation.  For example, some of the posts in question contained long quotes of verbatim dialogue from Godzilla Minus One and Overlord, published along with numerous images from the works.  The prosecutors successfully argued that these posts were so detailed, and contained little to no commentary, such that the posts might discourage consumers from actually watching the movies or anime because they would already know substantial details about the works.  The prosecutors also alleged that the website made hundreds of thousands of dollars in ad revenue, driven by views of their posts, including posts about Godzilla and Overlord.

Although U.S. infringers won’t face this kind of jail time, the arguments raised in the Japanese case are not so different from those seen in many litigations over commentary versus adaptations in the U.S.  One example is a famous U.S. Court of Appeals decision from the early 1990s, Twin Peaks Productions v. Publications International (which you can read more about here).  In that case, the owners of the IP from the cult TV show Twin Peaks argued that an unauthorized book was so detailed that it would dissuade consumers from renting or buying episodes of the show.  The plaintiffs ultimately prevailed in that case, although the infringers only had to pay monetary damages, rather than spend time in jail.

The Japanese case provides a good reminder: think before you post those spoilers and consider whether you are crossing the line from commentary to adaptation.  Websites and social media pages that focus on detailed, spoiler-heavy film summaries may find themselves in the cross-hairs of companies that want to protect their IP. 

Watch Episode 16 Here:

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Seyfarth Synopsis: The Second District reversed an order denying a motion to compel arbitration, holding that multiple onboarding documents reflected a valid and enforceable agreement to arbitrate individual employment and PAGA claims, and that a wholesale PAGA waiver did not defeat enforcement where it could be severed consistent with Viking River Cruises, Inc. v. Moriana.

In Santana, the plaintiff signed three arbitration-related agreements during his employment onboarding with Studebaker. After his termination, Santana filed a wage and hour class action asserting various Labor Code claims, including a PAGA claim. Studebaker moved to compel arbitration of Santana’s individual claims, including his individual PAGA claim, which the trial court denied. The Second District, Division Seven, rejected the trial court’s conclusion that purported conflicts among the arbitration provisions defeated mutual assent and that a wholesale PAGA waiver rendered the agreement unconscionable.

The Court of Appeal held that any inconsistencies across the onboarding documents “at most, created an ambiguity regarding some aspect of the agreement to arbitrate,” not uncertainty negating the parties’ clear intent to arbitrate employment related disputes under the FAA, including Santana’s individual Labor Code and PAGA claims. Although one provision contained a wholesale PAGA waiver, the court held that it conflicted with multiple provisions preserving non-individual PAGA claims and could be severed under Viking River. The court therefore concluded that the agreement remained enforceable and directed the trial court to grant the motion to compel arbitration.

The decision serves as a reminder that arbitration agreements are to be construed in favor of arbitration and inconsistencies in agreements do not invalidate an arbitration agreement including an agreement to arbitrate individual PAGA claims.

Douris highlighted the growing strain caused by workforce shortages in the construction industry, noting:

“You've got significant labor shortages, which has been a problem probably for the last 10 to 15 years but is really coming to a head right now.”

She further emphasized the need for a more collaborative approach among project stakeholders to better manage risk and volatility, adding:

“I think folks have to start to consider themselves less owner, contractor, subcontractor, and more like team partners.”

The full article is available here.

The Dearings were forced from their home in the 1920s because of their race through a combination of community-based violence and direct government action. That property is now valued at almost $3 million.

Seyfarth, along with the Legal Defense Fund, has filed suit to gain appropriate compensation for the Dearings’ descendant. The lawsuit seeks redress for Piedmont’s actions that deprived the Dearings of their home, generational wealth, and other benefits of home ownership. Piedmont had planned to construct a memorial but not to compensate the family.

Seyfarth partners Arnold E. Brown, II and Giovanna Ferrari, along with associates Niles Pierson and Clara Rademacher, have led the firm’s efforts, in conjunction with the Legal Defense Fund, to force Piedmont to pay reparations.

You can read the Op-Ed piece here. 

In this episode, Eric Greenberg is joined by James O’Brien and Christine Kim to break down key findings from the survey, including shifting asset allocation trends, expectations for rate cuts, and the growing role of AI in areas like due diligence and closing efficiency.

Read the full transcript here.

The Property Line™ is a brief and lively discussion of the biggest issues facing the commercial real estate industry. The podcast will deliver insights from Seyfarth's real estate lawyers and other industry leaders on current market trends and how they impact all facets of commercial real estate. 

If you have a question about this topic, ideas for future episodes, or are interested in being a guest speaker, please reach out to us.

Follow us on:  Apple Podcasts  |  SoundCloud  |  Spotify

The American Lawyer (Law.com) featured Lorie Almon, chair and managing partner of Seyfarth, in its article “Law Firms Are Going Further to Protect Their Equity Tiers.” The article, published on April 27, 2026, examines how Am Law 100 firms are increasingly expanding nonequity partner ranks while taking steps to preserve and strengthen their equity partnerships.

The American Lawyer (Law.com) featured Noah Finkel, co-chair of Seyfarth's national Wage and Hour Litigation practice group, in its article, “New Rule Would Clarify Who's in Charge Under ‘Joint Employer’ Status.” The piece, published on April 24, 2026, examines a proposed US Department of Labor rule aimed at creating a more uniform standard for determining joint-employer status amid the growth of outsourcing, staffing agencies, and franchise models.

Welcome back to The Week in Weed, your Friday look at what’s happening in the world of legalized marijuana. Obviously, the big news this week is federal rescheduling. But that’s not all! We have an update on the situation in Virginia, where apparently, elections have fewer consequences than one might have thought. Meanwhile, on Capitol Hill, two Senators that don’t agree on much would like to give states a way to opt out of a federal hemp ban. And finally, should 4/20 be a national holiday?

FEDERAL RESCHEDULING

You might be forgiven for thinking this day would never come, but the Drug Enforcement Administration (DEA) has officially moved state-legal medical marijuana and any cannabis products approved by the Food and Drug Administration (FDA) to Schedule III. See our blog post here.

VIRGINIA

Last week, we noted that Virginia Governor Abigail Spanberger (D) had made amendments to the cannabis retail market bill and sent her revised version back to the legislature. Well, the legislators have lobbed that ball right back to her side of the court – they did not agree to the amendments. So what does this mean? Is a retail market just as dead as if former Governor Glenn Youngkin (R) were still in charge? No, or at least not yet. Spanberger has 30 days in which to decide what to do. She could accept the fact that you can’t always get what you want and sign the bill. She could stick to her guns and veto it. Or, she could let it become law without her signature. Stay tuned.

HEMP BAN EXEMPTION

One does not usually see Senator Amy Klobuchar (D-MN) and Senator Rand Paul (R-KY) on the same side of an issue, but the 2020s are nothing if not a decade of surprises. Klobuchar and Paul are co-sponsoring a bill that would allow states to opt out of the federal ban on intoxicating hemp. The bill has not yet been officially introduced, so it’s hard to get a sense of whether it will go anywhere, but if it becomes law, many in the hemp industry will breathe a sign of relief.

AND FINALLY

District Cannabis, which operates in the District of Columbia and Maryland, thinks 4/20 should be a national holiday. Their partner, Ugly Agency, agrees:

“We decided to meet absurdity with absurdity,” said Nick Cade of Ugly Agency. “If millions of Americans already celebrate 4/20 like a national holiday, why not make it official? We wrapped that effort in satire, civic theater, and stoner logic.”

Be well everyone – we’ll see you next week.

Costantino emphasized the impact these changes will have on employers, noting that the new noncompete law is “a big call to action” for organizations that have relied on such agreements in the past. She added that “overall the paid leave laws, both sick leave and family medical leave, will be most significant,” as they will require employers to engage in substantial financial planning to cover the costs of new leave mandates.

Costantino also highlighted the compliance risks associated with the legislation, pointing to “increased risk for not complying across these laws” as the state’s labor department gains expanded enforcement authority. 

The full article is available here.

Introduction – Federal Rulemaking Is Like a Box of Chocolates

Anyone who has ever plucked a nondescript chocolate from a half-eaten box of candy knows that, sometimes, you just have to pop it in your mouth to know what’s inside. And that is not much different from the reality businesses have long faced with respect to joint employment under the FLSA: set a nationwide strategy and wait until a lawsuit is filed to learn what jurisdiction-specific, multi-factor test may apply—tests that, at times, may lead to contrary results. The DOL’s new joint employer rule, published on April 23, 2026 (the “Proposed Rule”), however, seeks to remedy that problem by setting a common filling throughout the box: the same four Bonnette-style factors that the DOL used in its 2020 joint employer rule (the “2020 Rule”).

But this time, it is the outer coating that has changed. Having learned from the vacatur of the 2020 Rule—its last attempt at rulemaking on joint employment under the FLSA— the DOL has made a number of compromises that make the Proposed Rule less sweet and enticing (i.e., less business friendly) compared to the 2020 Rule, but perhaps more savory (i.e., more likely to be adopted by a court).

Background – The Messy Box of Chocolates that Is the Joint Employer Space

Much like a box of chocolate left out at a party, joint employer jurisprudence is a chaotic patchwork of different inquiries, tests, and factors for businesses and workers to navigate. For example, the 4^th Circuit looks at whether the two putative joint employers are “completely disassociated” with one another, while the 2^nd Circuit considers whether the putative joint employer has “functional control over workers.” Even where there is agreement on what test to use, different courts use different variants of factors or weigh them differently.

In 2016, the DOL issued subregulatory guidance that attempted to impose an expansive definition of joint employer status, but this guidance was rescinded in 2017. Then, in 2019, the DOL proposed a new joint employer rule, which was finalized as the 2020 Rule. The 2020 Rule adopted the analysis used in the seminal Ninth Circuit case of Bonnette v. California Health & Welfare Agency. But, in the interest of analytical clarity and certainty, it limited consideration of factors that did not bear on control, and it rejected evidence bearing on a worker’s economic dependence on the potential joint employer as irrelevant.

Eventually, on September 8, 2020, the Southern District of New York vacated the 2020 Rule in New York v. Scalia. It found that the 2020 Rule contradicted the text of the FLSA, placed too much emphasis on control in contravention of the FLSA’s more expansive “suffer or permit” language, improperly precluded consideration of economic dependence factors, and failed to adequately explain its change in prior position or to address increased costs to employers and workers.

On July 30, 2021, citing Scalia, the DOL withdrew the 2020 Rule. It did not issued a new joint employer test through notice and comment rulemaking until the Proposed Rule.

Analysis of the Proposed Rule – Filling and Coating

The Filling

For most people, the filling, whether it is nougat, caramel coconut cream, an almond, or simply milk chocolate, is the star of the show. The same is true here: most businesses and workers care about the core joint employer test. Like the 2020 Rule, the Proposed Rule codifies that there are two flavors of joint employment. The Proposed Rule proposes to codify them as: (1) vertical joint employment; and (2) horizontal joint employment.

For vertical joint employment, the Proposed Rule puts forward a test that is, at least with respect to its four primary factors, virtually identical with that promulgated by the 2020 Rule and that are largely based on Bonnette. Those factors are whether the putative joint employer:

1. hires or fires the employee;
2. supervises and controls the employee’s work schedule or conditions of employment to a substantial degree;
3. determines the employee’s rate and method of payment; and
4. maintains the employee’s employment records.

One who bites into the Proposed Rule, however, may notice an important difference in flavor. The Proposed Rule goes on to state that “[n]o single factor is dispositive in determining joint employer status under the FLSA, as the determination will depend on all of the facts in a particular case.” By contrast, the 2020 Rule attempted to limit consideration of this kind of “all of the circumstances” analysis to those that bore on control. This appears to be a compromise by the DOL to “cure” an issue with the 2020 Rule identified by New York v. Scalia.

The Proposed Rule also readopts the supplemental clarifying provisions from the 2020 Rule, including (1) a reasonably circumscribed definition of “employment records”; (2) an acknowledgment of the primacy of actual conduct versus reserved control; (3) clarification of the role of “indirect control” and minimization of situations in which recommendations result in the direct employer making voluntary choices; and clarification of factors that are not relevant, including those that “are primarily probative of a worker’s status as an employee or independent contractor.”

Similarly, under the Proposed Rule, horizontal joint employment will be determined by a test that is nearly the same as that finalized in the 2020 Rule. The key inquiry is whether the putative joint employers are “acting independently of each other and are dissociated with respect to the employment of the employee” or whether they are “sufficiently associated with respect to the employment of the employee.” To determine whether a sufficient level of association exists, the Proposed Rule considers whether: (1) there is an arrangement between them to share the employee’s services; (2) one employer is acting directly or indirectly in the interest of the other employer in relation to the employee; or (3) they share control of the employee, directly or indirectly, by reason of the fact that one employer controls, is controlled by, or is under common control with the other employer. As with the proposed test for vertical joint employment, the Proposed Rule inserts a compromise, explaining that “[s]uch a determination depends on all of the facts and circumstances.”

The Proposed Rule, again like the 2020 Rule, also clarifies the relevance of certain business models and business practices, including that:

• Operating as a franchise or similar type of business model does not make joint employer status more or less likely;
• Requiring a putative joint employer to satisfy legal obligations or quality control standards does not make joint employer status more or less likely;
• The putative joint employer’s practice of providing the employer a sample employee handbook, or other forms, offering an association health or retirement plan, or any similar business practice, does not make joint employer status more or less likely.

Finally, the Proposed Rule, like the 2020 Rule, is sprinkled with examples that explain, clarify and make concrete these analyses. While, as discussed more below, these examples are organized differently, their nougaty substance is similar, other than those conformed to reflect substantive changes made to the Proposed Rule.

The Coating

Everyone has had the experience of eating two chocolates with different coatings, but much to one’s surprise, the same fillings. Here, the Proposed Rule and the 2020 Rule have similar tasting fillings, but with different coatings that fundamentally complement and change the flavor of the filling in different ways.

As mentioned above, the most important difference between the Proposed Rule and 2020 Rule is that the Proposed Rule does not seek to narrow the inquiry of “other circumstances” to those that bear on control, as the 2020 Rule did. The Proposed Rule also does not exclude—and in fact, expressly acknowledges—the relevance of “[i]ndicia of whether the employee is economically dependent on the potential joint employer,” in contrast with the 2020 Rule’s attempt to exclude such considerations.

Again, these changes are responsive to the court’s criticism in Scalia that the 2020 Rule hewed too closely to the common law test for employee status that the FLSA supposedly has rejected. By making these compromises, the DOL weakens the analytical clarity of the 2020 Rule, continuing a degree of uncertainty for businesses looking for definitive criteria to guide their decision-making. Now, extraneous facts that are not encompassed in the four factors, including those that bear on so-called “economic dependence” may potentially be relevant.  

In an attempt to cover the potential bitterness of this new coating, the DOL adds some clarification, explaining that any “additional factors” are less relevant than the four Bonnette-style factors, and that if the four Bonnette-style factors align, that outcome has a “substantial likelihood” of outweighing the additional factors. One may be forgiven for thinking that they have drawn the chocolaty form of the DOL’s Proposed Independent Contractor Test’s core-factor structure, although this is perhaps not an unwelcome surprise.

Finally, in a development that many might find sweet, the Proposed Rule has an expanded scope, as it also determines joint employer status under the FMLA and MSPA, in addition to the FLSA, whereas the 2020 Rule only covered the FLSA. Given that joint employer issues often are particularly salient for interstate operations that must undergo compliance with all of these statutes, this added uniformity will help increase clarity and certainty.

Overall, businesses and workers may find the Proposed Rule’s new coating slightly less enticing than that of the 2020 Rule. But, importantly, courts may find it more palatable, based on their interpretations of the FLSA and Supreme Court precedent interpreting the FLSA.

Aftertaste

The Proposed Rule is not a final rule. It was published in the Federal Register on April 23, 2026, and it will be open for public comment for sixty days (through June 22, 2026), after which the DOL will review public input and determine what, if any, revisions to include in a final rule. The timeline from proposed rule to final rule can take several months—and likely significantly longer—and the DOL may alter aspects of the proposal in response to comments.

As with chocolates, some courts will pick out the Proposed Rule while others will stick with their preferred flavors. Courts retain ultimate authority to determine who is or is not a joint employer, and whether any court will actually defer to the Proposed Rule—particularly in the face of binding circuit court-level precedent—is far from a certainty. And even then, those many circuit-level tests have proliferated to the analyses of many state-level statutes, which will be wholly unaffected by the Proposed Rule.

The Rule does provide certainty in at least one respect: as the DOL acknowledges in the Proposed Rule, it ensures that, for DOL enforcement personnel, there is a uniform standard being applied to determine whether joint employment relationship exists. That is, while courts may still elect to apply different tests in jurisdiction, the DOL will seek to enforce solely the test articulated in the Proposed Rule nationwide.

And ultimately, while the Proposed Rule perhaps shies further away from definitive criteria than many would have hoped, it is an improvement over the current absence of any rule. It provides an analytically clear and reasonably defensible version of the test that provides guidance for how to interpret the factors and apply them in real world situations.

What happened in the Fifth Circuit?

• On February 26, 2026, the United States Court of Appeals for the Fifth Circuit issued an unpublished opinion affirming summary judgment for the Anadarko Petroleum Corporation Change of Control Severance Plan and its administrative committee.
• The dispute centered on whether an executive was eligible to resign for “good reason” after a change in control based on a “material and adverse” diminishment in duties or a material reduction in base salary.
• The plan empowers the committee to interpret the plan and to construe ambiguous, unclear, or implied terms “in its sole judgment,” and states that its interpretations and determinations are not subject to de novo review.
• The former employee argued that the plan’s standards for “good reason” were ambiguous that therefore did not trigger the administrative committee’s discretion.
• The court emphasized that deciding whether duties or salary were “materially” and “adversely” affected requires qualitative, comparative fact-finding—including comparing duties, authority, and compensation before and after the change in control—and concluded that abuse of discretion was the appropriate standard of review.

What happened in the Tenth Circuit?

• In an earlier unpublished decision, Hoff v. Amended and Restated Anadarko Petroleum Corporation Change of Control Severance Plan, the Tenth Circuit addressed the same plan language and similar circumstances.
• In this case, neither party argued the “material and adverse diminishment” language was ambiguous. Treating ambiguity as a strictly textual question, the court read the plan’s delegation as operative only if a term was ambiguous on its face.
• Because no textual ambiguity was claimed, the court declined to defer and applied de novo review to the committee’s determination.
• Under the de novo lens, the court independently concluded the employee’s responsibilities were materially and adversely diminished and awarded benefits.

Why the same clause produced different review standards

The Fifth Circuit treated ambiguity as arising through application. It emphasized that determining whether duties were materially and adversely diminished after a change in control requires comparative factual assessments and judgment about the significance of the changes. Because the Severance Plan grants the committee authority to interpret the plan and bars de novo review of its determinations, the court concluded that these evaluative determinations fall within the committee’s discretionary authority, making abuse of discretion the proper standard.

The Tenth Circuit instead treated ambiguity as a strictly textual question. It concluded that discretionary authority applies only when a term is ambiguous as written. Because the parties in Hoff did not argue that the material and adverse diminishment standard was ambiguous, the Tenth Circuit viewed the language as clear, found no basis to invoke the delegation of discretion, and therefore applied de novo review.

As a result, identical plan language produced two different standards of review because the Fifth Circuit recognized ambiguity in the evaluative work required, while the Tenth Circuit recognized ambiguity only when the text itself was unclear.

Practical implications for plan sponsors

Although the Fifth Circuit and Tenth Circuit opinions are unpublished and therefore not precedential, they nonetheless provide meaningful insight into how courts may approach the interpretation of severance plan discretionary clauses. The split demonstrates the vulnerability of clauses that tie deference only to ambiguous terms. To reduce that risk, consider:

• Delegate discretion broadly. Grant the administrator explicit authority to make all determinations under the plan, including factual findings, eligibility assessments, and interpretations of all terms—whether or not ambiguous.
• Mandate deferential review.  State that all interpretations, determinations, and findings of fact are final and binding unless arbitrary or capricious.
• Avoid ambiguity triggers. Do not limit discretion to “ambiguous,” “unclear,” or “implied” terms; that limitation invites de novo review.
• Call out judgment-heavy topics. Clarify that materiality assessments, comparative evaluations of duties and authority pre- and post-transaction, and compensation-change assessments fall squarely within the administrator’s discretion.

The takeaway

Unpublished or not, these decisions are a timely reminder that the breadth and framing of a severance plan’s discretionary authority clause can decide the standard of review—and, with it, the outcome of a court’s review of close eligibility disputes. Employers should review their severance plans and discuss with legal counsel if the delegation of authority in its plan will ensure the maximum deference is afforded to the plan decisionmaker’s eligibility decisions.

Please contact the authors or the employee benefits attorney at Seyfarth with whom you usually work if you have any questions regarding the review standards in your severance or other ERISA plans.

In a Q&A feature published on April 23, 2026, the publication highlights the firm’s strong results in 2025, noting decisive victories in high‑stakes and multijurisdictional matters, success in narrowing or defeating nationwide class and collective actions, and leadership in shaping the broader employment law landscape through regulatory engagement.

The Southeastern Legal Awards recognize law firms and legal departments across the region for excellence in legal work, innovation, and client service. 

The full profile is available here.

Bartlett highlighted the DOL's cautious and strategic approach to rulemaking, noting:

“It shows a lot of thought by the department and a recognition that challenges always come up in court so why would they take a chance on something novel that might get knocked down?” 

The full article is available here.

The article analyzes the implications of a new executive order requiring agencies to insert mandatory DEI‑related certifications into federal contracts and explains why these provisions create a new layer of FCA risk. The authors explore how materiality and scienter standards under existing FCA doctrine may limit the government’s enforcement arguments, while also outlining practical, FCA‑specific steps contractors should consider before agreeing to the new contractual language.

As the authors caution:

“The clause is not a rote compliance checkbox. It is a prospective legal commitment that changes the evidentiary landscape for FCA purposes going forward.”

The full article is available here.

The move from I to III will happen in stages. First to go will be state-legal medical marijuana and any cannabis products already approved by the Food and Drug Administration (FDA). A broader rescheduling is set for consideration in late June.

So what does this mean? Several things:

1. Cannabis will NOT be legal under federal law.
2. More research will be legal under federal law, which is good news for the sponsors of the Higher Education Marijuana Research Act.
3. State-licensed cannabis businesses will be allowed to take federal tax deductions currently barred by IRC Section 280E.

Rest assured, there will be lots more news on this topic in the weeks and months ahead.

McKinley emphasized that, while the proposal offers useful guidance, it is unlikely to resolve the broader patchwork of standards employers face, noting:

“It offers baseline considerations, but employers will still need to account for the potential circuit- and state-level tests that may apply to federal and state wage claims in the different jurisdictions in which they operate.” 

The full article is available here.

On April 22, 1970, the very first Earth Day was celebrated.  In its honor, the Container Corporation of America — then one of the nation’s largest producers of recycled paperboard — sponsored a design contest to symbolize recycling.  Gary Anderson, a 23-year-old architecture student at the University of Southern California, submitted the winning entry: an equilateral triangle formed by three curved, chasing arrows intended to represent the concept of a closed-loop recycling process.

With no one claiming exclusive rights to it, the symbol quickly became ubiquitous. Over the following decades, it appeared on an enormous range of products and packaging — from plastic bottles to cardboard cartons to items that were rarely, if ever, actually recycled. In the 1980s, the Society of the Plastics Industry introduced a related system of resin identification codes — the numbers 1 through 7 placed inside a triangle of arrows — to identify the type of plastic resin used in manufacturing. Although these codes were designed for identification purposes only, many consumers understandably interpreted them as confirmation that a product was recyclable.

By the 2020s, a growing consensus had emerged — among environmentalists, industry groups, and regulators alike — that the gap between what the chasing arrows symbol implied and what actually happened to products at end of life had become significant. California’s legislature responded with Senate Bill 343.

What Is SB 343?

California Senate Bill 343, due to go into effect on October 4, 2026, establishes new standards governing when and how recyclability claims may be made on products and packaging sold in the state. The law declares that recyclability claims should be truthful and accurate, and that consumers should receive useful information about how to properly handle products at end of life.

The law also addresses broader environmental marketing claims, imposing documentation requirements on a range of “green” advertising terms.

Below is an overview of the law’s key provisions.  Future posts will discuss the status of the case seeking to enjoin enforcement of SB 343, the interaction between SB 343 and other California recycling statutes, the interaction between SB 343 and other State’s recycling laws, and other issues as the effective date of SB 343 draws near.

Who Is Impacted By SB 343?

The law prohibits “a person from offering for sale, selling, distributing, or importing into the state any product or packaging for which a deceptive or misleading claim about the recyclability of the product or packaging is made.”  Although its reach is very broad, it does exclude any “wholesaler or retailer who does not initiate a representation by advertising or by placing the representation on a package.”

When Does SB 343 Become Effective.

October 4, 2026.  However, on March 17, 2026, a coalition of 18 trade associations representing food producers, packaging manufacturers, grocers, and other industries filed a complaint in the U.S. District Court for the Southern District of California challenging the constitutionality of SB 343. The plaintiffs argue that SB 343 violates the First Amendment and is unconstitutionally vague under the Fourteenth Amendment’s Due Process Clause, and enforcement should therefore be enjoined.  As of this writing, the case is still in the very early stages, so it remains to be seen how it will play out.

What Does SB 343 Do?

1. It Regulates Broad Environmental Marketing Claims

SB 343 goes beyond recycling symbols. The law imposes documentation requirements on any person who represents — in advertising or on product labels — that a consumer good is “not harmful to, or is beneficial to, the natural environment.” This includes terms such as:

• “Environmental choice,” “Ecologically friendly,” “Earth friendly”
• “Environmentally friendly,” “Ecologically sound,” “Environmentally sound”
• “Environmentally safe,” “Ecologically safe,” “Environmentally lite”
• “Green product,” or any other like term

Any person making such claims must maintain written records documenting: the basis for believing the claim to be true; any significant adverse environmental impacts associated with the product; measures taken to reduce those impacts; any permit violations associated with production or distribution; and whether the product conforms with FTC Guidelines for Environmental Marketing Claims.

2. It Sets New Rules for Recyclability Claims

The law makes it unlawful to offer for sale, sell, distribute, or import into California any product or packaging bearing a deceptive or misleading recyclability claim.  Under SB 343, a product displaying a chasing arrows symbol, a resin identification code inside a chasing arrows symbol, or any other symbol or statement indicating recyclability is deemed to be a deceptive or misleading claim unless the product satisfies specific statewide recyclability criteria.

3. It Establishes Specific Recyclability Criteria

To qualify for a recyclability claim, a product or packaging must meet four benchmarks:

• Collection Threshold: Collected for recycling by programs serving jurisdictions encompassing at least 60% of California’s population.
• Sorting and Processing: Sorted into defined streams by large-volume facilities serving at least 60% of statewide recycling programs, with those streams sent to reclaiming facilities consistent with the Basel Convention.
• Design for Recyclability: Designed without components, inks, adhesives, or labels that prevent recyclability, as assessed under the APR Design® Guide (for plastics) or analogous standards (for non-plastics).
• No Harmful Chemicals: Free of intentionally added PFAS chemicals or PFAS at or above 100 parts per million as measured in total organic fluorine.

4. Material Characterization Study

SB 343 required California’s Department of Resources Recycling and Recovery (CalRecycle), to study which types and forms of material are commonly sorted and reused to make new products and packaging.  CalRecycle published the results in its SB 343 Final Findings Report on April 4, 2025, triggering the effective date of SB 343 for 18 months later, namely October 4, 2026.  The Report provides guidance to companies impacted by SB 343 regarding what goods are, and are not, considered recyclable.  The report is intended to be updated at least every five years.

5. It Restricts Resin Identification Codes

The law prohibits resin identification codes from being placed inside a chasing arrows symbol unless the product meets the statewide recyclability criteria. A resin code placed inside a solid equilateral triangle — rather than a chasing arrows triangle — is not subject to this restriction.

6. It Imposes Recordkeeping and Transparency Requirements

Any person who uses the term “recyclable,” displays a chasing arrows symbol, or otherwise directs a consumer to recycle must maintain documentation demonstrating compliance with the recyclability criteria. This documentation must be made available to any member of the public upon request.

7.  It Creates Penalties for Non-compliance And Opens The Door To Class Action Liability

Violations constitute a misdemeanor under California law. Compliance with the FTC Guidelines is generally a defense, but this safe harbor does not apply to claims involving recyclability symbols or resin codes regulated under SB 343.  More importantly, as any company that does business in California knows, California’s False Advertising Law and the California Consumer Legal Remedies Act (CLRA) both prohibit misleading and deceptive advertising, with the latter providing a private right of action that allows consumers to file class actions.

Conclusion

From its origins as a student design contest entry in 1970, the chasing arrows symbol has become central to how consumers understand — and sometimes misunderstand — recycling. SB 343 represents an effort to close the gap between recyclability claims and recycling realities. At the same time, the pending legal challenge raises substantial questions about the law’s constitutional boundaries. Businesses operating in California should stay informed and consult with legal counsel to understand how these developments may affect their products and marketing practices.

This blog post is for informational purposes only and does not constitute legal advice. Please consult with legal counsel regarding your specific compliance obligations under California Senate Bill 343.

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About the Program

Two years after the FTC’s landmark final rule on non-compete agreements, employers are still navigating a rapidly evolving landscape shaped by litigation, state law developments, enforcement priorities, and shifting strategies to protect competitive interests.

While the legal challenges to the FTC rule have abated, the broader movement toward limiting restrictive covenants continues to gain momentum at the state level across the country. Now more than ever, employers must evaluate how to safeguard talent, confidential information, customer relationships, and business value in an environment where traditional non-compete agreements face increasing scrutiny.

Join us for the next installment of Seyfarth’s 2026 Trade Secrets Webinar Series, where Seyfarth attorneys will examine where things stand now and what employers should be doing next.

Key Discussion Points

• Where the FTC non-compete ban stands two years later: litigation, enforcement, and regulatory outlook
• How state legislatures and courts are reshaping the restrictive covenant landscape
• Practical workarounds and alternative protections employers are using now
• Strengthening trade secret, confidentiality, and customer relationship protections
• Best practices for updating agreements, policies, and onboarding/offboarding processes
• What employers should be watching for in 2026 and beyond

This webinar is designed for in-house counsel, HR professionals, business leaders, and executives seeking practical guidance and actionable strategies to help their organizations stay compliant while protecting key business interests.

Speakers

Jesse Coleman, Partner, Seyfarth Shaw LLP
Gary Friedman, Partner, Seyfarth Shaw LLP
Eron Reid, Associate, Seyfarth Shaw LLP

REGISTER HERE

If you have any questions, please contact Sela Sofferman at ssofferman@seyfarth.com and reference this event.

Learn more about our Trade Secrets, Computer Fraud & Non-Competes practice.

To comply with State CLE Requirements, CLE forms requesting credit in IL or CA must be received before the end of the month in which the program took place. Credit will not be issued for forms received after such date. For all other jurisdictions forms must be submitted within 10 business days of the program taking place or we will not be able to process the request.

Our live programming is accredited for CLE in CA, IL, and NY (for both newly admitted and experienced).  Credit will be applied as requested, but cannot be guaranteed for TX, NJ, GA, NC and WA. The following jurisdictions may accept reciprocal credit with our accredited states, and individuals can use the certificate they receive to gain CLE credit therein: AZ, AR, CT, HI and ME. For all other jurisdictions, a general certificate of attendance and the necessary materials will be issued that can be used for self-application. CLE decisions are made by each local board, and can take up to 12 weeks to process. If you have questions about jurisdictions, please email CLE@seyfarth.com.

Please note that programming under 60 minutes of CLE content is not eligible for credit in GA. programs that are not open to the public are not eligible for credit in NC.

Seyfarth associates Zach Jacobson and Sarah Barney reunite to discuss timeliness issues – this time in contract claims and claim appeals.

The guidance, issued in the form of a memo to agency procurement officials, contains several significant aspects, which are summarized below.

Agencies must update their FAR Class Deviations. First, the guidance requires federal agencies to update their FAR class deviations for parts 9, 12, 22, and 52, to adopt revisions implementing the Order, by April 27, 2026.

• New 9.406-2(b)(1)(viii) makes failure to comply with the requirements of clause 52.222-90, Addressing DEI Discrimination by Federal Contractors a basis for debarment and new 9.407-2(a)(11) makes failure to comply a basis for suspension.
• Revised 12.205(a)(3) makes clause 52.222-90 a required clause in contracts for commercial products and commercial services.
• New subpart 22.22 contains definitions of “program participation” and “racially discriminatory DEI activities,” and instructs contracting officers to use clause 52.222-90 “in solicitations and contracts, including those for commercial products and commercial services, except those that result in contracts for which the place of delivery or performance is outside the United States.”
• New clause 52.222-90 contains the E.O. 14398 clause, which is entitled Addressing DEI Discrimination by Federal Contractors (APR 2026) (DEVIATION APR 2026).
• Revised clause 52.244-6 adds new clause 52.222-90 as a required flowdown in subcontracts for commercial products or commercial services. 

Importantly, because these revisions are being adopted through FAR class deviations, they will take effect immediately, before the Revolutionary FAR Overhaul undergoes notice and comment.

Agencies must use FAR clause 52.222-90 in new solicitations and contracts. Second, beginning April 24, 2026, new FAR 52.222-90 is to be used in new solicitations and resulting contracts valued over the micro-purchase threshold (i.e., over $15,000, subject to the exceptions outlined in FAR 2.101) including those for commercial products and commercial services, for which the place of delivery or performance is in the United States. The guidance clarifies that flow-down requirements extend to subcontracts at any tier.

Agencies must “make every effort to bilaterally modify” existing contracts. Third, by July 24, 2026, new FAR 52.222-90 is to be inserted by bilateral modification in all existing contracts valued over the micro-purchase threshold, including those for commercial products and commercial services, for which the place of delivery or performance is in the United States. If a contractor refuses to sign a bilateral modification, the contracting officer “should consider whether, absent the modification, the contract no longer meets the agency’s needs and should therefore be terminated for convenience.” For contracts expiring on or before December 31, 2026, modification is not mandatory, but, rather, at the contracting officer’s discretion.

Takeaways and Observations

The guidance adopts a sweeping approach as to which contracts are subject to the new clause, exempting only (a) contracts at or below the micro-purchase threshold and (b) those contracts to be performed or to be delivered outside the United States.

Additionally, the guidance takes a rigid approach to enforcement. The guidance directs contracting officers to consider whether to terminate contracts for convenience if contractors refuse a “bilateral” modification to incorporate the Order’s clause. And while the Order only required that agencies “take appropriate action to suspend and debar contractors or subcontractors” for failure to comply, the FAR Council made failure to comply with the new clause an express cause for debarment or suspension distinct from pre-existing provisions, which already contemplated debarment based on “serious” violations of Government contract or subcontract terms, such as FAR 52.222-90. Now, under the Overhaul version of the FAR, a simple, unintentional failure to comply with FAR 52.222-90, shown by a preponderance of the evidence, can result in debarment. The failure to comply need not be a serious, “willful failure” or “history of failure,” which under FAR 9.406-2 is the typical threshold for debarment based on contract non-compliance. The implication for contractors is that compliance with FAR 52.222-90 is being elevated over most other types of contract compliance.

But, while the guidance provides clarity on what might happen if contractors fail to comply, the guidance provides contractors with little guidance on how actually to comply with the clause, if any. It remains unclear, for example, what constitutes “disparate treatment based on race or ethnicity” or how the “allocation or deployment of an entity’s resources” will be evaluated.  Similarly, it is unclear what obligations contractors will have to assess to identify “reasonably knowable violations” of the clause by a subcontractor.

These questions and many others remain. Despite these questions, contractors should be on the watch for the clause in new solicitations and contracts and should anticipate that agencies will seek bilateral modifications of existing contracts. In the meantime, Seyfarth will continue to monitor agency guidance and implementation of this Executive Order.

For questions regarding potential impact or compliance considerations, please contact the authors of this alert or your Seyfarth attorney.

World Intellectual Property Review published an article by Lauren Leipold and John "J.C." Heinbockel of Seyfarth, “Lessons from Nutramax on defining trademark ‘use’.” The article, featured in the publication's first 2026 issue, examines how courts interpret “use in commerce” under US trademark law—and why imprecise contract language can create unintended risk.

Seyfarth Synopsis: DOJ issues Interim Rule extending Title II ADA web accessibility compliance deadlines by one year.

The DOJ finally answered the question on everyone’s minds: is it going to take action on the Title II website regulations, and if so, what? We now – 4 days before the compliance deadline – have an answer. Today, April 20, 2026, the U.S. Department of Justice (DOJ) issued an Interim Final Rule extending for approximately a year the compliance deadlines for state and local governments to make their websites and mobile applications accessible under Title II of the Americans with Disabilities Act (ADA). The compliance deadline for governmental entities servicing populations of 50,000 is extended from April 24, 2026 to April 26, 2027. Smaller governmental entities serving fewer than 50,000 people and special district governments’ compliance deadline is extended from April 26, 2027 to April 26, 2028.

Background: How Did We Get Here?

After over 10 years (since 2010) of fits and starts through different presidential administrations work to develop web accessibility rules under Title II (and Title III, now paused indefinitely), the DOJ published a final rule on April 24, 2024 adopting the Web Content Accessibility Guidelines (“WCAG”) version 2.1 Level AA (which was originally published in June 2018), as the technical standard for web content and mobile app accessibility applicable to governmental entities under Title II. As we noted in 2025, under the new administration DOJ announced it would review the economic impact of these regulations, which we expected at a minimum might delay the compliance deadlines.

Why Did DOJ Extend the Deadlines?

In the Interim Rule, the DOJ acknowledged it overestimated both technological readiness and institutional capacity of the governmental entities subject to the Rule when setting the original deadlines. The Rule lists several systemic challenges the DOJ identified:

(1) Concerning technology limits, automated tools cannot reliably remediate web content—particularly complex educational and STEM materials—without human review.

(2) Resource constraints facing governmental entities. Many public entities, particularly educational institutions, lack sufficient staffing, specialized expertise, and budget to ensure compliance.

(3) The “significant litigation risks” facing public entities that were unable to meet the prior deadlines, noting in particular the risk of private enforcement actions.

(4) Finally, and somewhat ironically, the DOJ noted that it created legal uncertainty surrounding WCAG guidance when it incorporated hyperlinks in the 2024 final rule.  The DOJ noted that the website at that hyperlink that was part of the April 2024 final rule was a “dynamically changeable” resource, meaning that the website to which individuals were directed had not only a description of WCAG version 2.1, but also of more recent versions of WCAG and multiple descriptions of criteria, which created compliance ambiguity about what standard it was adopting, and potentially would violate the Administrative Procedure Act and affected entities’ right to notice and an opportunity to be heard.

Impact: What Does This Mean For Governmental Entities and Their Contractors?

While the DOJ’s extension of these compliance deadlines for government websites and apps provides needed breathing room, it does not suspend existing ADA obligations and does not eliminate litigation risk for inaccessible digital content during the extension period – as enforcement actions have happened even absent specific website regulations under effective communication obligations of the ADA. Moreover, the substantive requirements remain unchanged: covered websites and mobile applications ultimately must conform to WCAG 2.1 Level AA by these new deadlines – they just get a year reprieve before being specifically regulatorily-required to do it. The DOJ cautions that it “fully anticipates implementing the regulation at the new deadline.” This could be taken as a warning that, although it has delayed the date for website accessibility compliance to assist governmental entities at this point, the DOJ might be prepared to launch enforcement actions when the compliance deadlines take effect in April 2027 and April 2028.

The DOJ’s extension offers welcome relief—but not immunity. The regulatory clock has been reset, not stopped. State and local governments that use the additional time to meaningfully advance accessibility will be best positioned to manage risk of litigation and enforcement actions and meet their obligations when the extended deadlines arrive. The Interim Rule won’t become final until after a 60-day comment window which closes June 19, 2026.

Edited by: Kristina M. Launey

Almon emphasized that clients are increasingly focused on value rather than percentage increases, noting:

“We’re always trying to find that sweet spot of what rate allows us to support our teams, attract and retain the top-tier talent, but also be fair to our clients, understanding they’re trying to exist in this volatile, uncertain, unpredictable world.” 

The full article is available here. 

Watch the Quick Take Here:

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The Quick Take highlights three converging federal initiatives: the Department of Labor’s AI Literacy Framework, the White House National Policy Framework for Artificial Intelligence, and the DOL’s new AI training program. It explains how these developments establish baseline AI competencies that may influence employer policies, regulatory expectations, and future litigation. The Quick Take outlines why organizations that align early with these frameworks may be better positioned to manage risk, attract AI‑ready talent, and demonstrate responsible AI governance.

The Quick Take emphasizes the growing practical impact of federal guidance, noting:

“The training operationalizes specific competency benchmarks that workers might carry into their jobs, giving those standards practical reach regardless of what any individual employer has done.”

The full Quick Take is available here (subscription required).

Law.com's Daily Report featured Justice Barber, a real estate partner in Seyfarth's Atlanta office, in its Q&A article, "Most Effective Deal-Makers Finalists: Justice Barber, Seyfarth Shaw." The piece, published on April 20, 2026, spotlights Barber as a finalist for its Most Effective Deal-Makers award and discusses her recent deal work, including leading the successful disposition of Birkdale Village, a $274 million mixed-use transaction, and her broader approach to effective dealmaking and client service. 

In the interview, Barber emphasized the importance of strategic judgment and preparation in complex transactions, noting:

“The successful closing of the Birkdale Village transaction reflects my approach to dealmaking: leading with preparation and judgment, maintaining a practical and solutions-oriented mindset, and delivering outcomes that allow all parties to move forward with clarity and confidence.” 

She highlighted what it takes to build long-term trust with clients in today’s transactional environment, explaining:

“Trust is built by taking the time to understand why a transaction matters, what risks truly concern the client, and how the deal fits into broader operational and investment strategies, not simply by executing documents efficiently.” 

The full Q&A is available here.

The Los Angeles Business Journal highlighted Sethness' ongoing efforts as an outstanding legal steward, noting:

"Over the course of his decades-long career, he has become the trusted advisor to major industry players in the shipping, logistics, and automotive sectors, guiding clients through high-stakes disputes and historic labor-relations events."

Sethness' work covers the full range of employment litigation, which spans federal and state courts, and arbitrations. His cases range from a federal court wage-hour class action alleging over $1 billion in damages, to multi-plaintiff discrimination and retaliation claims, to contentious single-plaintiff termination and failure to promote claims.

View the full list here.

The proposed regulations, released on March 9, focus heavily on pilot contribution eligibility and enrollment, adding new protections against multiple accounts being opened for the same child. Unfortunately, none of the newly proposed regulations speak to the mechanics of employer contributions to Trump Accounts. 

Confirmed Designs

The proposed regulations specify that the $1,000 federal pilot contribution applies only to children born 2025–2028, who are U.S. citizens with a Social Security Number (SSN) and have no prior pilot program election on file.

Authorized individuals can elect to open a Trump Account for a child at any time from SSN issuance through the end of the year in which the child turns 17. The IRS reaffirmed the use of Form 4547 to establish a Trump Account and request the $1,000 pilot program contribution.

Trump Account contributions cannot begin until July 4, 2026. An annual $5,000 total contribution cap will apply (including up to $2,500 from employers). Importantly, the proposed regulations confirm that any pilot program contributions do not count towards the annual $5,000 limit. Investments remain limited to index funds primarily composed of U.S. equity investments.

As a reminder, Trump Account funds generally remain locked until the year the child turns 18 and will typically follow traditional IRA rules after the child turns 18 (at which point the funds can be used for a variety of qualifying purposes, including education expenses, job training, down payment on a first home, capital to start a small business, and retirement).

Administrative Questions

On April 6, 2026, Treasury announced that the Bank of New York Mellon Corporation (“BNY”) will manage initial Trump Accounts and develop an associated app. Robinhood will serve as the brokerage and initial trustee of Trump Accounts.

Otherwise, many open questions remain with respect to the establishment and administration of Trump Accounts. For employers specifically, unanswered questions include applicable ERISA exemptions, plan document requirements and coordination with Section 125 cafeteria plans—all issues Treasury says it will address at a later date.

Takeaway

The Trump administration remains committed to the Trump Account program and eligible families will have the option to open a Trump Account when submitting their 2025 federal tax return. However, many open questions remain. We expect additional guidance later this year.

This special editorial report recognizes organizations helping elevate women who are shaping New York City’s future—mapping bold moves, taking meaningful risks, and driving decisions that influence their organizations and the region.

Read more about the recognition here.

Covered Employers and Covered Work

The amended law applies to employers operating hotels and motels, retail establishments, security companies, and property services contractors, including commercial janitorial companies. But the statute limits coverage to isolated employees working as janitors, security guards, hotel or motel housekeepers, and room service attendants within those industries. Temporary and staffing‑agency workers performing covered work are also covered by the statute.

Coverage is triggered when an employer employs at least one “isolated employee.” Under the amended law, an isolated employee is an employee who works without immediate access to coworkers or supervisors in an emergency, or who spends at least 50 percent of working time alone or without another coworker or supervisor present. Under the statute, “present” means being within the direct line of sight of other personnel of the employer. Workers may still be considered isolated even when coworkers are nearby. For example, housekeepers working in separate hotel rooms near one another remain isolated if they are not within direct line of sight. Practically speaking, the law is designed to protect employees who, due to the nature of their work, would need to call someone for help if in distress because coworkers or supervisors are not able to constantly observe the employee.

Expanded Employer Obligations

The requirement to provide panic buttons to isolated employees remains a central feature of the law, but the amendments clarify and expand employer responsibilities. Employers must now maintain records of panic button purchase and use and must make those records available to L&I upon request. Employers must also train employees and supervisors on panic button use and response procedures.

To be compliant, a panic button must be portable, simple to activate without delay, capable of transmitting an effective emergency signal, and able to accurately identify the employee’s location while summoning immediate on‑scene assistance. “Immediate” on‑scene assistance means that help is provided within a reasonable amount of time to determine whether an emergency is occurring, to rule out equipment failure, and, if necessary, to summon emergency services. Assistance may be provided by trained representatives of the employer, including managers or supervisors, security guards, or, where appropriate, other workers whose training, experience, and qualifications enable them to respond effectively to emergencies. For example, CPR-trained employees. Audible alarms may qualify as panic buttons only if responders can reliably hear the alarm and accurately locate the employee. Employers must cover all costs associated with providing panic buttons, including purchase, maintenance, and replacement.

In addition, covered employers must continue to maintain a written sexual harassment policy addressing reporting procedures, investigations, and protections against retaliation. The 2026 amendments reinforce this obligation by linking it to expanded training and documentation. Employers are required to provide mandatory training to managers, supervisors, and isolated employees covering the prevention of sexual harassment, sexual assault, and sexual discrimination, as well as employee protections for reporting violations of law. The training must also address how isolated employees use panic buttons and how managers and supervisors must respond when those devices are activated. Finally, employers must document the training provided and maintain records demonstrating completion.

Enforcement and Penalties

The amendments expand L&I’s enforcement authority. The agency must investigate complaints or suspected violations of the law and may issue citations for willful violations. Civil penalties start at $1,000 per willful violation and increase to between $2,000 and $10,000 per violation for repeat willful offenders. While penalties may be reduced or waived if corrective action is taken, employers who fail to timely produce records during an investigation may be barred from relying on those records in any appeal.

Next Steps

Given the expanded scope of the law and L&I’s enhanced enforcement authority, covered employers should review existing harassment policies, identify covered isolated employees, confirm that panic button systems have been provided and meet statutory requirements, update training and documentation practices, and prepare for potential audits or investigations.

Seyfarth has been selected as a 2026 Best Place to Work by the Boston Business Journal, an honor reflecting the strength of the firm's Boston office and a shared commitment to fostering an exceptional workplace culture.

Based entirely on employee feedback, the award evaluates work environment, work‑life balance, job satisfaction, career development, leadership, compensation, and benefits.

View the full list here.

Welcome back to The Week in Weed, your Friday look at what’s happening in the world of legalized marijuana. This week, we start off with Virginia, where legalization is so close, but yet so far. Then we move on to Texas, where a smokeable hemp ban has been blocked. In Maryland, veterinarians are now free to prescribe cannabis to Fido and Fluffy. And finally, when Roger Stone is unhappy with the pace of rescheduling, you know times have changed.

VIRGINIA

Remember when Democrat Abigail Spanberger won the governorship of Virginia, and everyone (including us!) thought that meant a retail cannabis market was coming to the Old Dominion State? Well, that may still happen, but not just yet. In Virginia, the governor has several options when considering a bill, including sending it back to the legislature to make changes. This is the option Spanberger has chosen. Will the legislature agree to these changes? Probably. Will Spanberger then sign the bill? Presumably. But the image of Charlie Brown and that football, with Spanberger playing the part of Lucy, keeps popping up…

TEXAS

Moving on to the Lone Star State, we see that the ban on smokeable hemp products promulgated by state regulatory agencies has been blocked by a state district court judge. Hemp has been on a roller coaster ride in Texas. The legislature passed a bill to ban it, but Governor Greg Abbott (R) vetoed that. Then Abbott asked the Texas Department of State Health Services and the Texas Health and Human Services Commission to come up with a regulatory scheme for hemp. The hemp industry viewed the resulting rules as tantamount to a death sentence and sued. Now, the regulations are on hold, at least until the next court hearing, set for April 23. So, smoke ’em if you got ’em Texans, because this is surely not the end of the story.

MARYLAND

Meanwhile, in Maryland, where both medical and adult-use cannabis is legal for humans, lawmakers have turned their attention to the herbal refreshment needs of our four-legged friends. Governor Wes Moore (D) recently signed legislation that provides legal protections to veterinarians who recommend medical marijuana for their patients. Currently, vets have felt unable to discuss cannabis with owners whose pets might benefit from the use of cannabis in dealing with cancer or other painful conditions. The law ensures that vets are able to answer questions and provide guidance for pet owners without fear of losing their license.

AND FINALLY

The 2020s have brought changes that no one could have predicted. Not least among them is that Roger Stone, a man so enamored of Richard Nixon (the President who brought you the War on Drugs) that he has a tattoo of Nixon’s face on his back, is now wondering who is responsible for the delay in federal cannabis rescheduling.

Be well everyone – we’ll see you next week.

Devata highlighted that the law also places new limits on consumer reporting agencies, noting:

“A consumer reporting agency may not provide a consumer report containing credit-history information for employment purposes unless a statutory exemption applies. This requirement mirrors the employer-side prohibition and prevents background providers from supplying credit information where employers may not lawfully use it.” 

The full article is available here.

Rachel Bernasconi, Paul Cutrone, Ben Dudley, Chris Gardner, Justine Giuliani, Erin Hawthorne, Michael Moy, Darren Perry, Henry Skene, Penny Stevens, and Michael Tamvakologos were recognized in their respective practice areas.

Read more about the rankings here.

Bloomberg Law featured an article by Jennifer Serafyn and Anuj Khetarpal, “Quick Response Is a Must When Facing a DOJ False Claim Act Probe.” The piece, published on April 16, 2026, examines how companies should approach Civil Investigative Demands (CIDs) issued by the U.S. Department of Justice under the False Claims Act.

The article highlights the increasing frequency and aggressiveness of DOJ CIDs and explains why a company’s actions in the earliest stages of an investigation can shape its ultimate outcome. The authors draw on their experience as former federal prosecutors to outline strategic response options, key early‑stage priorities, and best practices for engaging with the government to mitigate risk and narrow the scope of an investigation.

Serafyn and Khetarpal underscore the high stakes and the importance of early decision‑making, noting:

“How a company responds in the first 30 days after receiving a CID often matters more than the merits of the underlying allegations themselves. Those early decisions frequently determine whether an investigation narrows, escalates, or ends.”

The full article is available here.

In December 2025, New York enacted a new requirement mandating that certain employers maintain an opioid antagonist at the workplace.  In February 2026, the Legislature passed—and the Governor signed—a chapter amendment refining coverage, definitions, and implementation timing.  This follows California’s similar recent legislation imposing similar requirements (see a comprehensive recent article from our Workplace Safety team here).  As with other recent worker‑safety measures, these developments impose new compliance obligations on private‑sector employers operating in New York. 

Summary of the New Requirements

Here is a breakdown of the requirements under the amended law:

• Which Employers Are Covered? Only employers that are federally required to maintain first aid supplies under OSHA standards fall within the mandate. This generally includes employers that must maintain “adequate first aid supplies” because no infirmary or clinic is sufficiently near the workplace. Moreover, an employer is defined as any person, corporation, LLC, or association employing individuals in any occupation, trade, or business, but excludes governmental entities.
• What Must Employers Provide? Covered employers must maintain an opioid antagonist in the workplace among the federally required first aid supplies. The amendment clarifies that an antagonist must be available somewhere in the workplace—not necessarily in each individual first aid kit.
• What Counts as an “Opioid Antagonist”? The law incorporates the definition in Public Health Law § 3309, meaning a drug approved by the FDA that negates or neutralizes the effects of an opioid in the body, including naloxone (Narcan) and other approved formulations.

The law takes effect on December 13, 2026.

Anticipated Regulations to Address Outstanding Issues

The amendments direct the New York State Department of Labor (“NYSDOL”) to issue regulations. Outstanding issues that may be addressed by such regulations include: 

• The number of antagonists required per workplace.  The statute leaves the number of doses and precise placement for the NYSDOL to specify in regulations. Employers should expect guidance that scales with workforce size, layout, and risk profile.
• Employee training on usage and access.  The statute contemplates training of employees on use of the opiod antagonist, but does not specify the content.  Forthcoming regulations will likely clarify who must be trained, what curriculum is sufficient, and refresher frequency.
• Storage and availability parameters.  Because Naloxone has a finite shelf life, employers will likely need to develop processes for expiration tracking, replacement, and incident logs consistent with first‑aid practices.

Practical Implications for Employers

In advance of the December 2026 effective date, employers should take the following steps:

• Confirm Coverage.  Determine which locations are federally required to maintain first‑aid supplies under OSHA’s first‑aid standard.
• Plan Procurement.  Identify formulations (e.g., nasal spray) and quantities appropriate for the employer’s footprint, with a placeholder assumption to adjust when NYSDOL regulations issue.
• Draft/Update Protocols.  Update first‑aid/medical emergency SOPs to cover storage, accessibility, incident response, post‑incident documentation, and restocking.
• Prepare Training.  Identify the cohorts to be trained and outline a brief, practical training program (recognition, activation of EMS, administration, documentation), pending state rulemaking.
• Monitor Rulemaking.  Track NYSDOL/DOH regulations and update plans once stocking and training specifics are issued.
• Multi-Jurisdiction Compliance.  Ensure compliance with similar requirements in various jurisdictions, including California (see here).

In the short-term, employers with OSHA triggered first aid obligations should begin planning for procurement, storage, training, and inventory controls, while monitoring regulations from the NYDOL.

We will continue to monitor developments and provide updates as appropriate.

This post tracks recent changes in non-compete law for Q1 2026 throughout the country, provides key takeaways, and maps out the current landscape.

KEY TAKEAWAYS

1. Washington effectively banned all non-compete agreements, including in the health care industry. 
2. Virginia enacted a new law prohibiting the enforcement of non-compete agreements when an employee is terminated without cause unless the employer provides severance or other monetary payment.  The legislature also passed legislation which will effectively ban non-compete agreements with health care professions, and is now weighing recommendations from the governor.
3. Utah enacted legislation prohibiting non-compete agreements with health care workers, and
4. Montana expanded its prohibition on non-compete agreements with healthcare providers to include any physicians.   

CURRENT LANDSCAPE

The landscape regarding permissibility of medical non-compete agreements for health care providers has shifted considerably since June 2025:

STATE LEGISLATIVE DEVELOPMENTS

Washington

• The Washington legislature passed H.B. 1155 on March 23, 2026.[1]  The new law, which is effective on June 30, 2027, bans all noncompetition covenants with Washington-based workers and businesses.  Moreover, employers must make a “reasonable effort” to provide their current and former employees with written notice that current noncompete agreements are now void and unenforceable by October 1, 2027.  The new law also expands the definition of “noncompetition covenants” to include agreements that require an individual to return, repay, or forfeit any right, benefit, or compensation with limited exceptions for educational expenses.  Narrower categories of non-solicitation agreements are still permissible under the new law, provided the employee established or substantially developed a relationship during their employment and the agreement expires 18 months after separation.

Virginia

• Virginia enacted a new law which bars enforcement of non-compete agreements against employees (health care or otherwise) discharged without cause unless the employer provides severance benefits or monetary payment.  The employer must disclose the severance benefits or monetary payment upon execution of the non-compete.[2]  This new law also expands rights to sue for violations to all employees.  This law will not effect agreements entered into, amended, or renewed before the law’s effective date of July 1, 2026.
• The Virginia legislature passed a law which would broadly prohibit any employer from entering into, enforcing, or threatening to enforce a non-compete agreement with a health care professional.  This law defines a “health care professional” as any person licensed, registered, or certified by the Borad of Medicine, Nursing, Counseling, Optometry, Psychology, or Social Work.  On April 11, 2026, Governor Spanberger proposed an amendment to a provision in the bill regarding non-solicitation agreements which would permit providers to inform patients of the provider’s new contact information and patients’ right to choose a provider.  The legislature will consider this recommendation when it reconvenes on April 22nd.  If passed, the bills will be sent to the governor for signature who has an additional 30 days to sign the bills.

Utah

• Effective May 6, 2026, employers may no longer enter into non-compete agreements with health care workers.  Additionally, the new legislation voids non-solicitation agreements that prevent health care workers from informing patients of their current or future workplace.  The legislation defines a “health care worker” as an individual licensed and practicing in a wide range of clinical professions, including doctors, nurses, psychologists, and mental health counselors.

Montana

• Montana continued to expand its law prohibiting non-compete agreements with certain health care providers.  Effective January 1, 2026, Montana now prohibits non-compete agreements with any physician.  Previously, non-competes were previously prohibited for psychologists, social workers, and enumerated categories of mental health counselors.

California

• New legislation aimed at curbing the influence of private equity groups and hedge funds in health care went into effect on January 1, 2026.  The new legislation broadly bans contractual clauses prohibiting a provider from competing with a medical or dental practice if the provider is terminated or resigns from all contracts involving the management of a physician or dental practice and private equity groups or hedge funds.  The practical effect of the new law will likely be negligible, as California has effectively banned most non-compete agreements for decades.

New Threshold Shifts

Compensation thresholds continue to shift, with Colorado, the District of Columbia, Maine, Oregon, Rhode Island, and Virginia updating eligibility levels for employees who can be bound by restrictive covenants.

Pending Legislation

Some states whose legislatures are still in session have pending legislation which, if passed, will affect noncompete agreements with healthcare providers in Iowa and Maine.  Most notably though, the Virginia legislature will consider the governor’s recommendation to the legislature’s effective ban on non-compete agreements with health care professions when it reconvenes on April 22nd.  Stay tuned for another update this summer as the landscape continues to shift.

[1] See our earlier full coverage on this new law.

[2] See or earlier full coverage of recent legislation in Virginia here. 

The U.S. Department of Transportation’s Interim Final Rule (IFR) has created months of uncertainty for contractors, agencies, and certified firms trying to understand what comes next for the DBE program and goals on federally funded projects. In California, at least one piece of that uncertainty now has a date attached to it.

On March 2, 2026, Caltrans and its California Unified Certification Program (CUCP) partners began the statewide reevaluation process for all Disadvantaged Business Enterprise (DBE) and Airport Concession Disadvantaged Business Enterprise (ACDBE) firms. Caltrans set a deadline of April 16, 2026 to submit the materials required for reevaluation: a Personal Narrative, a Personal Net Worth statement, and supporting documentation.

While the USDOT has not set a deadline for recertification, prime contractors, teaming partners, and firms pursuing federally funded transportation and airport work in California, April 16 is now a real deadline with real project implications.  Firms may submit recertification packages after April 16, but they will be processed after the packages received before April 16.

This post is the first in a short series on the IFR and its practical effects. Here, we focus on California’s fast-approaching recertification deadline.

California has moved from uncertainty to implementation

For months, the IFR was mostly discussed in terms of disruption: narrowed eligibility standards, suspended goal setting, and confusion about what the transition would look like in practice. California is now one of the clearest examples of that transition becoming operational.

Caltrans has formally launched the reevaluation process and has tied timely firm responses to the eventual resumption of goal setting, counting, and reporting. In its March 3, 2026 letter to the industry, Caltrans explained that the reevaluation effort is intended to support uninterrupted eligibility when certification activities restart and to promote stability in the construction and professional services marketplace.

In other words, California is no longer waiting to see how this will play out. It is implementing the new framework now.

What firms need to submit

All firms seeking recertification must submit:

• a Personal Narrative;
• a Personal Net Worth (PNW) Statement; and
• required supporting documentation.

Caltrans has also made available guidance materials, tools, and webinars are available to help firms complete their submissions on its website.

For previously certified firms, this is not business as usual. It is the recertification process California is using to address the new federal requirements.

Why this matters for current and future work

The IFR did not just change certification standards. It also disrupted the goal-setting and counting framework that contractors and agencies had been using on federally funded work. Caltrans’ actions and early deadlines make clear that recertification is part of the effort to position California to resume normal program functions once permitted.

The practical takeaway is straightforward.

Although DBE goals have been suspended for now, that does not mean they have been eliminated forever and firms must look ahead to what comes next after recertification is complete.  Delays in recertification can create downstream uncertainty for firms trying to staff jobs, line up teams, price work, or assess future opportunities once goal-related processes resume.

What contractors should do before April 16

For California contractors, the near-term response should be practical.

Check in with key DBE partners now. If a current or prospective subcontractor matters to your project pipeline, find out whether the firm submitted its recertification package in California.

Treat recertification as a project-risk issue. On federally funded transportation and airport work, subcontractor readiness and team planning may be affected by whether firms move promptly through this process.

Revisit internal assumptions. If pricing, staffing, or pursuit strategy has been built around older DBE assumptions, now is the time to pressure-test them.

California matters here not only because of its market size, but because it offers one of the first clear examples of what IFR implementation looks like on the ground: notices issued, materials identified, a submission window established, and industry told to move quickly.

That makes April 16 more than an administrative milestone. It is an early test of how quickly firms, contractors, and agencies can adjust to the new DBE framework in practice.

Conclusion

California contractors should treat the April 16, 2026 DBE recertification deadline as more than a paperwork deadline.

For certified firms, it is the immediate path forward under the new federal framework. For prime contractors, it is a practical deadline that can affect subcontractor readiness, pursuit planning, and project continuity. And for the market more broadly, it is one of the clearest signs yet that the IFR is no longer just a policy development. It is becoming an operational reality.

For California contractors, April 16 is not just a certification deadline. It is a scheduling, teaming, and risk-management deadline.

Seyfarth Synopsis: Virginia passes heat illness statute to develop VOSH heat illness standards regulating private employers by May 1, 2028.

With the federal OSHA heat illness standard in rulemaking limbo, the Commonwealth of Virginia officially joined the growing list of states taking workplace heat illness prevention into their own hands. With the Governor’s approval of SB 288 on April 13, 2026, the Commonwealth is charting a path toward enforceable heat safety standards for both indoor and outdoor private‑sector workplaces, even as a federal rule remains incomplete.

While the Virginia rule will not take effect immediately, employers should view this legislation as an early warning—and an opportunity—to begin developing heat illness programs.

Core Areas for New Heat Illness Regulations

SB 288 does not establish specific exposure limits or prescriptive controls. Instead, it directs the Virginia Safety and Health Codes Board to develop formal heat illness prevention standards by May 1, 2028. Those standards will apply broadly across industries and will address work performed in both indoor and outdoor workplaces

The real regulatory impact will unfold during the rulemaking process over the next several years. However, the statute specifically mandates that the new VOSH regulations must require employers to provide:

1. Water,
2. Access to shade or climate-controlled environments when practicable,
3. Rest periods,
4. Acclimatization to working in heat,
5. Effective training regarding heat illness prevention,
6. Heat and high-heat procedures when the temperature equals or exceeds heat thresholds to be set by the Board at a future date, and
7. Effective emergency response procedures.

These core elements are consistent with existing heat illness prevention standards in California, Maryland, Minnesota, Nevada, Oregon, and Washington, as well as long-standing, but unofficial, heat illness guidance from federal OSHA.

The statute specifically excludes a range of emergency services and heat exposure lasting no longer than 15 consecutive minutes.

The Temperature Threshold Question

One of the most important open questions in Virginia is what temperatures trigger initial and “high-heat” protections. States that already regulate heat exposure have taken different approaches, using a mix of ambient temperature, heat index, or industry‑specific thresholds.

Virginia regulators will need to strike a balance between protecting workers from heat‑related illness and fatalities; and crafting a rule that is enforceable across industries.

This same challenge has slowed progress at the federal level, where OSHA’s progress on a national heat standard has stalled at the rulemaking stage. The uncertainty around federal timing and scope was a key reason Virginia paused its own heat rulemaking back in 2021. This time, the Commonwealth is not waiting.

Recommendations

Under the OSH Act’s General Duty Clause, heat illness can be a recognized hazard when employees are exposed to high temperatures. Although Virginia’s final heat illness rule is years away, employers already are required to protect employees from recognized hazards under the General Duty Clause. Virginia employers would be wise to develop or implement existing heat illness prevention programs this spring to reduce the risk of employee injury and illness. Reasonable preparatory steps could include:

• Reviewing current heat illness prevention policies (or drafting them if none exist)
• Identifying work tasks and locations with elevated risk of heat exposure
• Ensuring hydration, shade, and rest practices are documented and consistently applied
• Training supervisors to recognize early signs of heat illness
• Ensuring emergency response protocols are understood and implemented
• Monitoring rulemaking activity and participating in stakeholder input when available

Federal OSHA updated its Heat National Emphasis Program on April 10, 2026, emphasizing that heat hazards are no longer a temporary or emerging concern, even extending the NEP by five years, through 2031. The revised program keeps the basic framework of the original 2022 NEP but reflects a sharper, more data-driven enforcement approach with a clearer roadmap for issuing citations. OSHA has also refined industry targeting based on injury and fatality data, with increased attention on indoor heat risks, warehousing, construction, and transportation.

For employers, the smartest approach is proactive, not reactive. Heat illness prevention is no longer an emerging concept; it is rapidly becoming a baseline expectation across the country.

If you are evaluating whether to implement a heat illness program or need a multi‑state compliance strategy, the Seyfarth Workplace Safety & Environmental team is ready to assist.

For the full version of this article, please click here.

• 1 January: The Platform Workers Act came into effect, enabling, amongst other things, platform workers to obtain financial compensation should they get injured in the course of work. Click here to read more.
• 1 January: The minimum qualifying monthly salary for the application and/or renewal of an Employment Pass increased. Click here to read more.
• 8 January: The Workplace Fairness Bill was passed in Parliament. Click here to read more.
• 14 March: In the case of Hayate Partners Pte Ltd v Rajan Sunil Kumar [2025] SGHC 41, the Singapore High Court considered the appropriate inquiry in respect of claims in relation to breach of contractual obligations of confidentiality and breach of confidence in equity. Click here to read more.

• 1 April: Eligible employees have six weeks of shared parental leave to share between them and their spouse and from 1 April 2026, this increased to ten weeks. Click here to read more.

• 1 June: Businesses are permitted to hire non-Professionals, Managers, Executives, and Technicians workers from more countries. Click here to read more.
• 1 July: In the case of Goh Hui En Rebecca v IG Asia Pte Ltd [2025] SGHCR 20, the Singapore High Court clarified that the fact an employee chooses to bring a claim before the Employment Claims Tribunal (“ECT”) does not bar the employee from bringing a subsequent claim before the Singapore High Court, where the claims are of a different nature. Click here to read more.
• 1 July: The maximum employment age for existing Work Permit holders increased from 60 years old to 63 years old. Click here to read more.
• 4 August: The Ministry of Manpower, the National Trades Union Congress and the Singapore National Employers Federation (together, the “Tripartite Partners”) announced that they had formed a Tripartite Working Group (“TWG”) to develop recommendations in relation to a review of Singapore’s key employment legislation, the Employment Act (“EA”). Click here to read more.
• 1 September: The minimum qualifying salary requirement for applying for a S Pass increased. Click here to read more.
• 11 September: The Platform Workers Trilateral Group comprising the Ministry of Manpower, Ministry of Transport, National Trades Union Congress and Grab Singapore provided recommendations to safeguard the livelihoods, safety and well-being of platform workers. Click here to read more.
• 28 October: The Personal Data Protection Commission (“PDPC”) imposed THE highest financial penalty ever imposed on a company for breach of personal data protection obligations. Click here to read more.
• 4 November: The Workplace Fairness (Dispute Resolution) Bill was passed in Parliament. Click here to read more.
• 1 December: The list of Occupational Diseases (“ODs”) in the Second Schedule of the Workplace Safety and Health Act 2006 and Work Injury Compensation Act 2019 was updated to enhance occupational health surveillance and strengthen employee protection. Click here to read more.

2026 Outlook

• Transition to more employee-friendly employment landscape;
• Employers will be expected to be familiar with the legal requirements of the WFA and to implement fair employment practices in time for WFA taking effect (anticipated in 2027);
• Likely that restrictive covenants will become even more difficult to enforce, requiring more consideration by employers on how to draft and when to impose and enforce them.

2025 Year in Review – Singapore Employment Law (Full Version)

2025 saw a series of developments take place in the Singapore employment law landscape. This article provides a summary of the key developments over the past year.

January

With effect from 1 January 2025, the Platform Workers Act came into effect, allowing platform workers to obtain financial compensation should they get injured in the course of work, and also providing platform workers with strengthened protections in the form of increased Central Provident Fund contributions, where applicable.

From 1 January 2025, the minimum qualifying monthly salary for the application and/or renewal of an Employment Pass (for employees apart from those in the financial services sector) increased from S$5,000 to S$5,600. The minimum qualifying monthly salary for employees in the financial services sector increased from S$5,500 to S$6,200.

On 8 January 2025, the Workplace Fairness Bill was passed in Parliament, and the Workplace Fairness Act 2025 (“WFA”) was assented to by the President on 3 February 2025. The WFA was established to protect against workplace discrimination and to establish fair employment practices. The WFA will complement the existing Tripartite Guidelines on Fair Employment Practices.

Significantly, under the WFA, an employer is prohibited from making an employment decision that adversely affects an individual on the ground of a protected characteristic of the individual, unless certain exceptions apply. Protected characteristics have been defined under the WFA to be age, nationality, sex, marital status, pregnancy, caregiving responsibilities, race, religion, language ability, disability, and mental health condition.

March

On 14 March 2025, in the case of Hayate Partners Pte Ltd v Rajan Sunil Kumar [2025] SGHC 41, an employer commenced a claim against its former employee for breach of obligations of confidentiality and breach of confidence in equity as the former employee had allegedly downloaded documents belonging to the employer at or around the time during which he tendered his resignation and retained copies of such documents upon the termination of employment.

The Singapore High Court took the view that a two-step inquiry shall apply when there are express contractual obligations of confidentiality and the question of whether additional or more extensive obligations of confidentiality in equity should be imposed arises. This would involve considering the following:

(a) First, does the contract specify the information to be treated as confidential and/or the extent and/or duration of the obligations in respect of the information?

If the answer is yes, then the starting point is that equity would not ordinarily impose additional or more extensive obligations than those specified in the contract. For example, if the contract specifies the information to be treated as confidential, the starting point is that equity would not treat a larger scope of information as being confidential.

(b) Second, even if the answer to (a) is yes, would it plainly offend a reasonable man’s conscience that additional or more extensive obligations in equity are not so imposed?

If the answer is yes, then the starting point may be departed from, and equity may step in to impose such additional or more extensive obligations.

April

With effect from 1 April 2025, eligible employees have six weeks of shared parental leave (“SPL”) to share between them and their spouse and from 1 April 2026, this increased to ten weeks. Employees are eligible for SPL if their child is a Singapore citizen (or, in the case of adoption, where the child is not Singaporean, one of the adoptive parents must be a Singapore citizen) and they have worked for a continuous period of at least three months before the birth of the child/date of formal intent to adopt the child. All mothers are eligible for SPL if they meet these criteria. Fathers will be eligible for SPL if they meet these criteria and are lawfully married to the child’s mother (or were lawfully married to the child’s mother between conception and birth, or within twelve months from the child's date of birth).

June

With effect from 1 June 2025, to allow businesses to hire skilled non-Professionals, Managers, Executives, and Technicians (“non-PMET”) workers from more countries, businesses are now permitted to hire non-PMET workers from Bhutan, Cambodia and Laos, in addition to Bangladesh, India, Myanmar, Philippines, Sri Lanka and Thailand.

July

On 1 July 2025, in the case of Goh Hui En Rebecca v IG Asia Pte Ltd [2025] SGHCR 20, the Singapore High Court clarified that the fact an employee chooses to bring a claim before the Employment Claims Tribunal (“ECT”) does not bar the employee from bringing a subsequent claim before the Singapore High Court, where the claims are of a different nature. As the ECT has a jurisdictional limit, employees may first file smaller and more urgent claims (e.g. salary in lieu of notice) before the ECT, and may subsequently pursue larger or more complex claims separately in the High Court.

From 1 July 2025, the maximum employment age for existing Work Permit holders increased from 60 years old to 63 years old to enable employers to retain experienced workers.

August

On 4 August 2025, the Ministry of Manpower, the National Trades Union Congress and the Singapore National Employers Federation (together, the “Tripartite Partners”) announced that they had formed a Tripartite Working Group (“TWG”) to develop recommendations in relation to a review of Singapore’s key employment legislation, the Employment Act (“EA”). The TWG will consult and engage stakeholders, including employers and employees, to make recommendations on updates to be made to the EA to ensure that there are adequate protections for different groups of employees. In particular, the National Trades Union Congress’ Deputy Secretary-General has expressed that “This review of the EA is necessary to update and strengthen protections for our workforce especially for Professionals, Managers and Executives (PMEs), given that the nature of work has changed over time...”. It is anticipated that the TWG would submit its recommendations to the Government by the second half of 2026.

September

From 1 September 2025, the minimum qualifying salary requirement for applying for a S Pass increased from S$3,150 to S$3,300. The qualifying salary will continue to increase progressively with age, up to S$4,800 for a candidate in their mid-40s. The S Pass minimum qualifying salary for employees in the financial services sector increased from S$3,650 to S$3,800. The qualifying salary will increase progressively to S$5,650 for a candidate in their mid-40s.

On 11 September 2025, the Platform Workers Trilateral Group comprising the Ministry of Manpower, Ministry of Transport, National Trades Union Congress and Grab Singapore provided recommendations to safeguard the livelihoods, safety and well-being of platform workers. A total of 10 recommendations were made and these recommendations include, amongst others, that:

• The Government and platform operators should work together to strengthen enforcement and set stringent punishments for abetting illegal platform work across all platform sectors.
• Platform Operators, Platform Work Associations and the Government should encourage Platform Workers and members of the public to report suspected illegal activities to the Government.
• Platform Work Associations will continue to encourage Platform Workers to prioritise and take care of their health and safety.

The full list of recommendations may be accessed here.

October

On 28 October 2025, the Personal Data Protection Commission (“PDPC”) imposed a financial penalty of S$315,000 on a company in Singapore. This is the highest financial penalty imposed since the 2021 amendments to the Personal Data Protection Act 2012 (“PDPA”) came into force, which increased the cap on financial penalties from S$1 million to 10% of the annual turnover of the organisation in Singapore (subject to a minimum cap of S$1 million). The PDPC found that the company had breached its data protection obligations which required it to protect personal data in its possession or under its control by making reasonable security arrangements to prevent unauthorised access, collection, use, disclosure, copying, modification, disposal or similar risks.

November

On 4 November 2025, the Workplace Fairness (Dispute Resolution) Bill was passed in Parliament.  The Workplace Fairness (Dispute Resolution) Bill provides the statutory framework for the resolution of claims relating to discrimination in the workplace. The ECT will hear workplace discrimination claims up to and including S$250,000 – and the High Court will hear claims above this limit. Significantly and regardless of the quantum of claim or the judicial forum which the claim is to be heard in, the following set of rules will apply:

• Claimants are required to attempt mediation before filing a claim at the ECT or the High Court.  
• Requests for mediation must be submitted within prescribed time bars.
• Claims will be heard in private, and parties have a duty to consider amicable resolution during adjudication.
• The ECT and the High Court will adopt a judge-led approach where judges take a proactive role in managing the case.
• The ECT and the High Court will be empowered to strike out frivolous claims, and to award costs against claimants who file such claims on a case-by-case basis.

December

With effect from 1 December 2025, the list of Occupational Diseases (“ODs”) in the Second Schedule of the Workplace Safety and Health Act 2006 and Work Injury Compensation Act 2019 was updated to enhance occupational health surveillance and strengthen employee protection.

In particular, in the realm of musculoskeletal disorders, “Musculoskeletal disorders of the upper limb” were replaced with and expanded to “Work-related musculoskeletal disorder”, which includes work-related musculoskeletal disorders involving the back, spine and lower limbs. This means that employees who suffer any work-related musculoskeletal disorders due to workplace ergonomic risk factors may be covered.

In addition, “Occupational infectious disease” will be broadened beyond Tuberculosis. Reporting will be required for infectious diseases acquired from work related exposure to infectious biological material by clinical and non-clinical support staff in healthcare, laboratories or research settings.

2026 Outlook

With the introduction of the WFA in 2025 and with a review committee being established to review the EA, it is anticipated that more employee-friendly steps may be taken to shift the employment landscape in Singapore. Employers should note that:

• Further to the introduction of the WFA, employers are expected to be familiar with the legal requirements and to implement fair employment practices to ensure alignment with the requirements of the WFA once it takes effect.
• In light of recent case development, it is anticipated that restrictive covenants would be even more difficult to enforce and while the Ministry of Manpower has yet to issue guidelines on the use and imposition of restrictive covenants in employment contracts, employers should remain prudent and seek to impose and enforce restrictive covenants only where there is a legitimate interest to protect and where the restrictive covenants are reasonable in scope, duration and geography.

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As another piece of harmonization legislation, the AI Act is unsurprisingly reminiscent in regulatory philosophy to the GDPR. Many of the same data principles (transparency, accuracy, security) are present, as is an explicit risk-based approach. Understanding precisely where there is overlap with your existing GDPR program is a head start in your AI Act compliance program design. But it is also important to recognize where the two frameworks diverge. The GDPR regulates what happens to personal data, the legal basis for collection, how it is used, how long it is kept, who can access it. The AI Act generally regulates the AI system itself – namely, how it is designed, tested, documented, governed, and deployed. While that difference in regulatory object creates structural differences in inputs and outputs, the framework itself does have a lot of commonalities.

This post suggests a strategy for efficiently building a unified compliance framework for both regimes.

How can you leverage the overlap between the two regimes?

• Integrated governance committee. A single cross-functional body (legal, compliance, engineering, procurement, and business units) can own both GDPR and AI Act risk, provided its terms of reference explicitly address both regulatory objects. Some organizations expand the DPO role with additional expertise, while others have to create a separate AI compliance function. To cover both, the DPO role should have a baseline technical understanding of AI systems, risk assessment methodologies, and technical safety requirements.
• Consolidated risk assessment process workflows. Run risk assessment triage, DPIA, and AI fundamental rights impact assessment (FRIA) exercises from a single intake workflow, separating into parallel workstreams only where the regulatory requirements genuinely diverge. This avoids duplicative stakeholder interviews and shortens overall cycle time.
• Vendor and supply chain management. A unified vendor questionnaire covering data processing agreements and AI Act contractual provisions can be significantly more efficient than running two procurement tracks. Both regimes require appropriate safeguards in relationships with suppliers and other parties. Notably, Article 47 of the AI Act requires providers of high-risk AI systems to include a statement of GDPR compliance in their declaration of conformity where the system processes personal data.
• Unified training curriculum. AI literacy (mandatory under the AI Act from February 2025) and GDPR awareness training share a natural home in the same learning program. In both subjects, legal and compliance staff, technical developers, and operational deployers need different depths of learning.

How does regulatory philosophy support integration into one compliance program?

Risk-based architecture. Both the GDPR and the AI Act employ a risk-based approach to compliance. The GDPR calibrates obligations to the severity of risks to data subjects’ rights and freedoms. The AI Act classifies AI systems into four risk categories ranging from minimal-risk to prohibited, then tiering obligations accordingly.

Accountability and documentation. The accountability principle is the spine of both regimes.  To demonstrate accountability, the AI Act requires much more elaborate documentation of development and design choices for high-risk AI systems and GPAI models than the GDPR’s DPIAs and processing records. But policy libraries, audit trails, and governance procedures built for GDPR provide a credible scaffold for AI Act documentation.

Impact assessments. GDPR Article 35 requires DPIAs for high-risk personal data processing. The AI Act Article 9 requires a risk management system for high-risk AI systems. Although the AI Act explicitly states that AI fundamental rights assessments can build on GDPR DPIAs to avoid duplication, this is not the same document. But a well-structured DPIA will capture some of the same risk categories as an AI Act risk management assessment.

Transparency and human oversight. GDPR Article 22 gives individuals the right not to be subject to solely automated decisions with significant effects and Article 14 of the AI Act requires that high-risk AI systems are designed to enable effective human oversight. This is the same practical outcome.

Supervisory authority overlap. In many Member States, the Data Protection Authority will also be the AI Act market surveillance authority — meaning a single regulator may scrutinize both your GDPR and AI Act posture in the same inspection.

Don’t forget to mind the gaps, however.

Product safety logic vs. data protection logic. The AI Act represents a fundamental shift from merely outcomes-based (i.e. GDPR) to both outcomes-based and “go to market” requirements. Unlike GDPR’s blanket compliance approach, the AI Act requires pre-market approval for high-risk AI systems. Similarly, the conformity declaration under Article 47 has no GDPR equivalent. Lifecycle obligations differ fundamentally: GDPR compliance is continuous and data-flow-oriented; AI Act compliance has hard pre-deployment gates and mandatory post-market monitoring obligations that track the model itself, not the data it touches.

Scope of application. The GDPR is triggered by the processing of personal data, full stop. The AI Act applies to AI systems irrespective of whether personal data is involved. Many AI deployments (e.g. computer vision for infrastructure, predictive maintenance, materials optimization) fall entirely outside the scope of GDPR but within the scope of the AI Act. Your GDPR program simply has nothing to say about them.

Risk taxonomy mismatch. There is a fundamental difference between the two regimes in terms of the stage at which risk is addressed as well as the types of risk in play. In general, the GDPR provides for a broader range of discretion in weighing and balancing interests. The AI Act’s risk classification is categorical and pre-determined by Annex III and Article 6; a system is either high-risk or it is not. GDPR risk is a spectrum assessed contextually for each processing activity. Further, AI-based risks may not be related to a secondary use (or misuse) of data, but more toward to an adverse action being taken based on incorrect data. Mapping one taxonomy onto the other produces analytical distortions.

Technical documentation obligations. Unfortunately, GDPR compliance does not give you the technical documentation required under AI Act Article 11. The requirement to document system architecture, training methodology, and performance benchmarks is unique to the AI Act. There is no GDPR analogue, and no amount of Records of Processing Activities drafting fills that gap.

Separate enforcement architecture. A data breach caused by an AI system malfunction may require dual reporting to separate authorities. The AI Act requires market surveillance authorities to consult data protection authorities when enforcement concerns both AI and personal data issues — but the enforcement tracks remain legally distinct, and penalties under each regime can in principle accumulate.

Key Takeaways

Bottom line is: treat the two programs as siblings, not twins. Build a shared governance layer — committee structure, vendor management, training, and impact assessment intake — that serves both regimes simultaneously. The AI Act constitutes a complementary, yet stricter, regulatory layer for AI-driven data processing; requiring joint interpretation with the GDPR to ensure coherent application. Still, one needs to resist the temptation to collapse the two into a single compliance artefact. Maintain distinct registers: your RoPA alongside your AI system inventory; your DPIAs alongside your AI Act Article 9 risk management files and Article 11 technical documentation packages.

Assign clear ownership at the intersection: who is responsible when a high-risk AI system processes special category data? That intersection – where GDPR’s most stringent provisions meet the AI Act’s highest-obligation tier – is where regulatory exposure is greatest and where integrated governance makes the most sense.

Finally, keep one eye on the EU’s Digital Omnibus proposals: the proposal amends the AI Act by clarifying compliance obligations, streamlining conformity assessment procedures, and updating requirements for high-risk AI systems. These changes that may alter the calibration between the two frameworks. The architecture you build now should be designed to absorb that evolution.

What Virginia Employers Need to Know

Non-competes entered into after July 1, 2026, will become unenforceable if the employer terminates the employee’s employment without cause and does not provide severance benefits or other monetary payments to the employee.

Non-competes include both traditional prohibitions on competition and, pursuant to recent case law, employee non-solicit covenants.

The severance benefits or other monetary payments must be disclosed at the time the non-compete agreement is entered into.

The new law will become effective July 1, 2026 and only applies prospectively.

Violations of Virginia’s law may result in liability to employers. First, employees will be authorized to bring a civil action against any employer who attempts to enforce a non-compete in violation of the law. Any successful employee will be entitled to recover reasonable costs, fees for expert witness, and attorneys’ fees. Second, employers who violate the statute face civil penalties of $10,000 per violation, paid into the Commonwealth’s general fund.

What Virginia Employers Need to Do

Any employer who may hire employees in Virginia post-July 1, 2026, and desires to use a non-compete agreement, needs to update their restrictive covenant agreements to provide for “severance benefits or other monetary payments to the employee.”

Ersin's recognition reflects her role in shaping Seyfarth's culture of innovation and driving meaningful change across the firm by leveraging design thinking and developing innovative solutions that enhance client service delivery and value. Her ability to rethink legal service and integrate automation, artificial intelligence, and process optimization ensures that the firm remains at the forefront of legal innovation.

In a Q&A with The American Lawyer, Ersin discussed how she encourages innovation across the firm:

"Don't just think "what if" — say it out loud and test it. Ideas stall when people fear being wrong or wasting time. I build "safe to try" guardrails, invite imperfect first drafts, and run small, time boxed experiments with clear success criteria. The habit isn't brainstorming; it's building with curiosity, grit, and the courage to see ideas through."

She also offered guidance on how firms can remain competitive and responsive amid constant change in the legal industry:

"Above all, cultivate learning agility, be flexible, curious, and solution focused. Tools will keep evolving. Your edge will be translating client needs into scalable solutions and improving how your team learns, shares, and executes."

Read more about the award here.

The authors highlight the growing necessity of integrating legal, technological, business, and risk expertise into client‑facing teams, emphasizing that GenAI adoption cannot succeed in isolation. Drawing on industry trends and Seyfarth’s own experience, the piece explores how embedded, cross‑functional collaboration improves innovation, mitigates risk, and delivers measurable value to clients in an increasingly technology‑driven legal market.

Kim and Poor underscore the importance of true integration, noting:

“Innovation in law firms cannot succeed without collaboration across disciplines.” 

The full article is available here.

The value of delivery certainty

AI campuses and hyperscale data centers are reshaping power procurement by shifting the focus from price alone to schedule certainty, uptime, and continuity.

When load is large and timelines are tight, buyers pay for certainty. As a result, that demand is pushing more deals toward turnkey, performance-backed structures.

The practical shift is simple: the provider is not only selling energy, but rather, they are selling a delivery outcome (i.e., on time, online, and scalable).

At campus scale, even a modest schedule slip can create commercial consequences that take years to unwind. These commercial pressures are exactly what is driving the shift toward agreements that define, allocate, and price delivery outcomes rather than energy alone.

Making the model real

These deals work only when the agreement prevents “risk drift,” where execution and performance risk slides back to the customer through vague definitions, weak remedies, or loose change-control provisions.

In this market, power generation agreement terms are increasingly built around outcomes:

• Acceptance gate: objective commissioning tests, clear go-live milestones, and cure mechanics.
• Availability standard: defined measurement methodology, outage taxonomy, and narrow excused intervals.
• Downtime economics: service credits or liquidated damages that scale with shortfall, typically subject to negotiated caps.
• Continuity rights: step-in and transition mechanics designed to keep the site online.
• Risk boundaries: tight force majeure and customer-caused event definitions.
• Change control discipline: scope, schedule, and cost rules that prevent margin leakage.
• Bankability: assignment and financing flexibility plus lender recognition that preserves continuity.

Without these terms, “as-a-service” is branding. With them, execution risk becomes a priced, managed obligation.

Practical checklist for developers

In practice, these dynamics translate into several concrete steps developers can take to reduce schedule and downtime risk.

• Before you pick a provider:
  • Require a clear delivery plan with testable milestones.
  • Confirm fuel strategy, interconnection path, and commissioning sequencing.
  • Validate that “optional expansion” is priced and engineered, not aspirational.
• In the contract:
  • Demand objective acceptance tests and clean go-live triggers.
  • Define outages with precision (planned vs. unplanned, excused vs. non-excused).
  • Make remedies meaningful and scalable.
  • Protect continuity with step-in and transition rights.
  • Lock change control early to avoid scope creep and delay disputes.
• During project execution:
  • Set weekly reporting cadence and issue escalation paths.
  • Require root-cause reporting for material events.
  • Align outage coordination with site operations.

Practical checklist for IPPs

On the IPP side, these same pressures translate into a set of disciplines that help keep delivery risk priced and manageable.

• Before you submit a term sheet:
  • Price only the risk you can control, and do not sell what you cannot measure.
  • Standardize design, vendors, and commissioning where possible.
  • Secure supply chain and long-lead items early.
• In the contract:
  • Tie milestones to objective criteria you can administer.
  • Keep force majeure and customer-caused events tight and readable.
  • Use clear caps, but avoid caps that destroy credibility.
  • Make bankability real without giving away continuity control.
• During project delivery:
  • Treat commissioning as a product, with a repeatable test regime.
  • Build operating integration into the deal (reporting, response times, escalation).
  • Run post-event review like an operations discipline, not a blame exercise.

Key Takeaways

Certainty is now the core product. Developers should demand objective acceptance and real continuity protection. IPPs should standardize execution and price only what they can control. If your agreement does not define acceptance, outages, and remedies with precision, the risk will drift back to you, and you will pay for it later.

Bartlett highlighted the longstanding complexity surrounding the exemption, noting:

“The Motor Carrier Act exemption has been around for quite a while, and it is nevertheless an exemption that is misunderstood by the defense and the plaintiff's bar, and even by some of the representatives of the federal Wage and Hour Division. It contains a lot of nuance that I think trips up all of those stakeholders.”

The full article is available here.

1. Litigation under Washington’s CEMA, RCW 19.190, have flooded courts following a ruling from the Washington Supreme Court on April 17, 2025, which held that email subject lines containing false or misleading information were violative of CEMA and per se violations of the Consumer Protection Act (CPA).
2. A legislative amendment, HB2274, was signed into law on March 23, 2026 and instituted three new changes to CEMA: (1) requiring senders to have actual knowledge that the email contains false or misleading information; (2) reducing statutory damages from $500 to $100; (3) CEMA amendments do not apply retroactively to causes of action commenced prior to June 11, 2026.

For further discussion of these developments, see our accompanying vidcast episode.

Increased CEMA Litigation

On April 17, 2025, the Washington Supreme Court ruled that email subject lines containing false or misleading information were violative of CEMA and per se violations of the CPA. Since the Washington Supreme Court case, there have been approximately 115 cases filed alleging violations of CEMA. Especially for online retail clients, who advertise heavily over email, this statistic is something that clients should be wary of as they solicit Washington residents.[1]

Legislative Amendment (HB2274)

Legislative amendment, HB2274, has attempted to stem the flow of lawsuits against retailers. As the senate bill report notes that prior to June 2025, only eight CEMA lawsuits affected retailers, but since June 2025, “there have been over 100 CEMA lawsuits.” The report goes on to note that the Washington Supreme Court’s ruling that “the falsity of a commercial email was determined by the subject line, not the body of the email…was not the legislative intent.” On March 23, 2026, the Washington legislature and Governor Bob Ferguson acted in three ways to address CEMA’s reach with HB 2274.

First, the legislature revised RCW 19.190.020(1)(b) to specify that a commercial email that “uses a subject line which, based on the person’s actual knowledge or knowledge fairly implied on the basis of objective circumstances, contains false or misleading information in the subject line” is unlawful.

This added knowledge requirement could cut in favor of defendants in these cases. This could lead to defeating the case at the summary judgment stage if a defendant did not have knowledge that it sent an email with a subject line that contained false or misleading information. Moreover, if senders take precautions to ensure (and be able to prove) that the email subject lines were drafted based on good-faith representations and understanding of the promotions at the time the email was sent, then this could shield them from liability under the statute’s amendment.

Next, RCW 190.040(1) lowered the statutory damages for recipients of emails violative of CEMA from $500 per violation/commercial email to “$100 or actual damages, whichever is greater.” While this reduction does not eliminate liability for senders, it does materially reduce potential damages.  However, the potential exposure could still be significant especially for high-traffic email retailers, given the likelihood that these cases will be asserted as class actions resulting in aggregate liability.

Lastly, the legislature decided to not apply the CEMA amendments retroactively. Specifically, the act “applies to all causes of action commenced on or after the effective date of this section [June 11, 2026], regardless of when the cause of action arose.” In other words, all suits commenced on or after June 11, 2026, would be bound by the CEMA amendments. In the interim, this amendment is already leading to increased filings as the class action plaintiffs’ bar races to the courts to take advantage of the higher statutory damages and lack of knowledge requirement while they still can.

Conclusion

Though the April 17, 2025 Washington Supreme Court ruling opened the floodgates of litigation under CEMA, there will likely be a shift in the landscape following the Washington legislature’s recent amendments to the Act, with an anticipated drop to come in the number of these class actions filed against retailers. Regardless, in order to mitigate their risk and comply with CEMA, retailers and businesses should ensure that subject lines are accurate—particularly those advertising promotional offers or sales—even if the body of the emails qualify the subject line. Moreover, senders should pay particularly close attention to time-sensitive promotions and ensure they do not run for more than their allotted time. 

Looking ahead to changes brought on by HB 2274, senders could shield themselves from liability by instituting a review of subject lines prior to sending to ensure accurate wording and representations and maintaining clear documentation, which shows the factual bases for subject line claims, is key.

As litigation continues and a body of case law is developed interpreting CEMA, including the recent amendments, retailers should continue to be vigilant and develop compliance guardrails given lawsuits under CEMA.

[1] RCW 19.190.020(1) states that “[n]o person may initiate the transmission, conspire with another to initiate the transmission or assist the transmission, of a commercial electronic mail message from a computer located in Washington or to an electronic mail address that the sender knows, or has reason to know, is held by a Washington resident.”

Watch Episode 15 Here:

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Seyfarth’s real estate team provides a bird's-eye view of the current state of commercial real estate throughout the country—highlighting which markets and major asset types are active, slowing down, or experiencing shifts.

Seyfarth’s Take: What to Know

✔ Opportunities: Data centers remain the strongest nationwide opportunity, with continued expansion across Texas, the Midwest, and key coastal markets. Industrial and multifamily are stabilizing in several regions, while retail is showing signs of recovery in urban cores and high-quality corridors. Most markets are seeing improving fundamentals and renewed investor optimism.
✔ Challenges: Office performance remains uneven, with persistent vacancy and reduced valuations continuing to weigh on major markets. Broader economic uncertainty is tempering transaction activity, while policy and regulatory factors, including potential rent control measures in Boston, increased scrutiny of data center development, and infrastructure constraints, are creating additional complexity for investors and developers.
✔ Market Trend: The CRE landscape is entering a more balanced phase, with stabilization across multiple asset classes and renewed momentum in select high-growth markets. Data centers continue to anchor activity, while AI-driven demand is accelerating recovery in tech-centric regions like San Francisco.

Regional Rundown

"The Atlanta commercial real estate market is trending stable to soft amid ongoing economic uncertainty. Office remains the most challenged sector, while industrial, multifamily, and retail are cooling following a strong run. Data centers continue to stand out as a bright spot, supported by an active development pipeline, though political and civic headwinds are increasing." Kwame Benjamin, Partner

"Strong fundamentals persist in the Boston real estate market. However, a statewide rent control referendum on the November ballot is creating some uncertainty within the real estate and greater business communities, particularly amongst buyers, developers, and investors of multifamily assets." Catherine Burns, Partner and Eric Greenberg, Partner

"Across the Charlotte commercial real estate market, fundamentals remain stable. Multiple asset classes are demonstrating steady absorption and measured growth, supported by diversified demand, disciplined development, and continued population and employment expansion in the region." Eric Sidman, Partner

"The Chicago commercial real estate market is a mixed picture, with very strong demand in data centers and industrial, steady activity in multifamily and retail, and a notably weak office sector that continues to lag." Michael Merar, Partner and Tobi Pinsky, Partner

"The Dallas commercial real estate market entered 2026 with stabilizing fundamentals and continues to be recognized as a top market to watch nationally." Amy Simpson, Partner

"In the Houston area, industrial and retail sectors remain strong, while multifamily is facing oversupply and office continues to experience historically weak conditions. Although energy prices remain a key driver of the local economy, optimism tied to rising oil prices is tempered by uncertainty stemming from policy shifts in Washington, DC." Peter Oxman, Partner

"The Los Angeles commercial real estate market is showing renewed momentum. Data centers remain highly active, while industrial and multifamily are becoming more optimistic, with expectations for rising rents and declining vacancies. Office continues to face challenges, with transaction activity at reduced valuations, though retail sentiment has improved and new development is anticipated for next year." Tim Farahnik, Partner and Stacy Paek, Partner

"The New York commercial real estate market is steady overall, with strong activity in industrial and multifamily, stable performance in data centers and retail, and softer conditions in office." Miles Borden, Partner and Cynthia Mitchell, Partner

"The San Francisco commercial real estate market is experiencing a notable rebound, with improving conditions across multiple asset classes, including office. This momentum is being driven by the growth of the AI sector, a more pro-business local government approach, increased public-private collaboration, and a broader return-to-office push among employers." Robin Freeman, Partner

"In Seattle, data center demand remains strong, the industrial sector has largely stabilized, and multifamily is showing a modest uptick as buyer demand improves. These trends come against the backdrop of challenges posed by hybrid work and consistently high operating costs." Jami Balint, Partner

"Data centers continue to be a key driver in the greater Washington, DC market, though they are facing increased scrutiny from local governments. At the same time, urban core retail is recovering and emerging as a relative strength." James O’Brien, Partner

About Seyfarth's Real Estate Team

Recognized as one of the largest real estate practices in the US, we have built an integrated team that serves local, regional, and national clients on the acquisition, financing, development, leasing, restructuring, servicing, and disposition of noteworthy real estate assets and portfolios. This experience extends across comprehensive array of asset classes, including office, industrial, multifamily, retail, health care, and data center projects. Learn more about our Real Estate practice.

Michael Wexler, Mitch Robinson, and Bessie Fakhri led a practical discussion for in-house counsel, compliance professionals, product leaders, and executives operating in online gaming, sports betting, and predictive markets. The session explored how proprietary algorithms, AI-driven models, and consumer data are becoming central assets—and central risks—in an increasingly competitive and scrutinized industry.

View the Recording – CLE credit for this recording expires on March 31, 2027. See description for jurisdictions and details.

Key Takeaways

Predictive Markets Introduce New Trade Secret Exposure

The rise of predictive markets is creating new incentive structures that may increase the risk of misuse or leakage of confidential information. Where outcomes are tied to data inputs, modeling assumptions, or internal insights, companies must carefully assess how access to sensitive information could be leveraged—intentionally or unintentionally—in ways that compromise trade secrets.

Routine Auditing Is a Core Safeguard

Online gaming platforms and sportsbooks are increasingly implementing routine audits of systems that handle proprietary and trade secret information. These audits are critical to maintaining defensibility under trade secret law, helping organizations:

• Identify access vulnerabilities
• Monitor data flows across systems
• Demonstrate “reasonable measures” to protect confidential information

Regular, documented auditing practices are becoming a baseline expectation in this space.

AI Expands Both Capability and Risk

The growing incorporation of AI across online gaming, sportsbooks, and predictive markets raises important considerations around trade secret protection and user privacy. Key risks include:

• Exposure of proprietary data used in model training
• Unclear ownership of AI-generated outputs
• Increased scrutiny of how algorithms operate and use sensitive data

Organizations must implement clear governance around AI systems, including data controls, usage policies, and documentation.

Regulation Will Shape the Industry’s Future

Regulatory frameworks at both the federal and state levels continue to evolve and will play a significant role in shaping the future of online gaming, sportsbooks, and predictive markets. Increased scrutiny around data use, consumer protection, and platform integrity will directly impact how companies:

• Define and protect trade secrets
• Structure their platforms and offerings
• Respond to compliance and disclosure obligations

Staying ahead of regulatory developments will be critical to maintaining both compliance and competitive advantage.

Looking Ahead

As online gaming, sportsbooks, and predictive markets continue to expand and converge, trade secrets will remain central to competitive positioning. Companies that proactively audit their systems, implement strong AI governance, and adapt to evolving regulatory expectations will be better positioned to protect sensitive information while navigating an increasingly complex legal landscape.

To ensure you don’t miss future sessions, subscribe to our Litigation – Trade Secrets & Non-Competes mailing list. For tailored programs, our attorneys are available to present customized sessions for your organization. Subscribe to our Trading Secrets blog for ongoing insights on trade secrets, employee mobility, and information governance.

Seyfarth Synopsis:  As of January 1, 2026, AB 889 bulldozed California’s Prevailing Wage law, which impacts public works employers—including public agencies, the contractors that work for them, and private owners and developers whose projects may be subject to public works requirements. The amended law reframes the calculation of fringe benefits for individuals who work on public works project and mandates annualization of such benefits, demolishes the practice of frontloading these benefits, and requires employers to maintain inspection-ready records of compliance.   

This year, AB 889 significantly revised California’s prevailing wage law, codified at Labor Code section 1773.1, to clarify the state’s prevailing wage regulations and streamline enforcement. Accordingly, as of January 1, 2026, California public works employers are required to annualize employees’ fringe benefits and maintain specific documentation demonstrating statutory compliance. These new obligations impact public agencies and their contractors, as well as private owners and developers whose projects may be subject to public works requirements. Continue reading for the blueprint of how to comply with the state’s amended prevailing wage law.

The Foundation: What is the Prevailing Wage?

“Prevailing wage” consists of the minimum per‑hour wage rate and the fringe benefit rate set by the Department of Industrial Relations (DIR) that must be paid to qualifying workers. Fringe benefits can be credited to employees only if they meet the requirements of section 1773.1, which includes contributions for health, pension, vacation, travel, and apprenticeship benefits.

The Workforce Roster: Who is Entitled to the Prevailing Wage?

All workers employed on public works projects must be paid the DIR-determined prevailing wage for the areas in which the project is located.

The Specs: What is a “Public Work” Under California Law?

The Labor Code broadly defines “public works” as including: construction, alteration, demolition, installation, or repair work done under contract and paid in whole or part from public funds. But, this definition can be misleading because the definition of “public funds” encompasses more than monetary payments.

“Public funds” include not only direct payments, but also fee waivers, land conveyed below market value, tax credits, and government loans or grants. Thus, even indirect forms of public support can trigger prevailing wage requirements. For example, developer-funded projects may qualify as public works if the project is tied to a public agency requirement (e.g., conditions of approval), and public-private partnerships may also qualify if the public agency retains control or provides financial assistance to the private company.

The Renovation: What Prevailing Wage Requirements Did AB 889 Change?

California’s amended law retrofitted the state’s prevailing wage practices as follows:

1. Mandatory Annualization of Fringe Benefits
   Prior to January 1, 2026, the annualization calculation applied only to certain benefits. AB 889 mandated that all employer-paid fringe benefits credited toward the prevailing wage be computed on an annualized basis, using any consistent 12-month period, and account for employee’s public and private hours worked for the same employer. This is the same method adopted by the federal Department of Labor in enforcing the Davis-Bacon Act for crediting contributions made to fringe benefit plans.
   
   Contractors may still choose whether or not to provide fringe benefits on prevailing wage jobs, and there are a few narrow exceptions to the amount of credit an employer may seek for fringe benefit payments that are included in the annualization requirement. However, the most critical exception has been retroactively revoked. Prior to January 1, 2026, the Director of the DIR was authorized to waive an annualization calculation method if it was deemed not to serve the purpose of the law. AB 889 not only removed this exemption, but immediately revoked any exemptions issued by the Director prior to the bill’s effective date.
   
2. Prohibition of Frontloading Fringe Benefits
   Some employers previously allocated 100% of fringe benefit contributions to employees’ public project hours to maximize the fringe benefit credit. AB 889 eliminated this practice.
   
3. Recordkeeping and Document Production Requirements
   Covered employers must maintain records of each worker’s total annual hours across public and private projects, benefit contribution schedules, and employee-specific annualized calculations. This documentation must be produced to the Division of Labor Standards Enforcement (DLSE) upon request. Failure to comply with such a request could lead to denial of the employer credit.

The Inspectors: How are the DIR and DLSE Enforcing the Prevailing Wage Law?

Recently, the DIR and DLSE have significantly expanded prevailing wage enforcement efforts. These agencies’ audits tend to focus on underpayment, employee misclassification, improper apprentice ratios, and inaccurate certified payroll. Penalties for noncompliant practices can include withholding contract funds and issuing civil wage and penalty assessments.

Contractors can also face other collateral consequences, including but not limited to California Contractors State Licensing Board disciplinary actions and/or debarment for willful violations or apprenticeship misuse or ratio violations

The Winning Blueprint: Start Building Compliance from the Ground Up!

The amended requirements under AB 889 create new job site hazards for public works employers in California relating to cash wage obligations, unbudgeted labor cost overruns, subcontractor non-compliance, and possible DLSE enforcement actions.

The following early compliance efforts can help protect employers from prevailing wage potholes:

• Conduct internal fringe-benefit audits;
• Update payroll systems to perform annualization automatically;
• Train payroll and field supervisors on proactive compliance;
• Ensure that the compliance clauses in applicable construction contracts and subcontracts are strong, and include flow-down obligations;
• Review public funding triggers, including fee waivers, land conveyances, or tax credits that might subject a project to public works requirements; and
• Restructure benefits to ensure that only bona fide contributions receive prevailing wage credit. 

Workplace Solutions

If you have questions about AB 889 compliance, or other construction industry employment issues, contact the authors of this article or your favorite Seyfarth lawyer for more information.

Edited by Catherine Feldman

Weiss pointed to the communications between the two countries as a real-world example of how misalignment can complicate negotiations and lead to costly outcomes. He emphasized the importance of defining key terms early in any transaction to ensure all parties share the same understanding and advised leaders to avoid public announcements until agreements have been thoroughly vetted internally.

The full discussion can be heard at the 3:51 mark of the episode, "Noon Business Lunch 4/14/26: Market jump, core inflation, negotiation complexities."

Balint's practice covers the full spectrum of transactional real estate and land development matters, with a particular focus on data center, industrial, and build-to-suit leasing transactions. 

GlobeSt will highlight Balint in an upcoming feature article.

View the full list here.

The authors explore how traditional employment law doctrines—such as retaliation, whistleblower protections, wage and hour compliance, and workplace safety—are likely to apply in extraordinary operational settings, even when work is connected to orbital or international missions. While international space treaties govern state-level responsibilities, Bartlett and Humphrey emphasize that domestic employment law will continue to govern private workforce disputes, underscoring the need for proactive compliance and risk management as commercial space activity accelerates.

As the authors note:

“For space companies, the most immediate legal risks are unlikely to arise from international space law. Instead, they will arise from familiar employment law doctrines being applied in unfamiliar — and potentially attention-grabbing — contexts.”

The full article is available here.

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About the Program

We’re bringing this webinar back by popular demand. If you missed it the first time, we’ve got you covered!

Join us for an informative webinar with our privacy experts to go over the California Privacy Protection Agency’s newly adopted regulations under the CCPA, which went into effect on January 1, 2026. We’ll discuss how these changes affect businesses now and in the years ahead, along with other critical compliance considerations, including:

• Governance of automated decision-making technologies;
• Comprehensive privacy risk assessments;
• Mandatory cybersecurity; and
• Consent management and compliance with the California Invasion of Privacy Act (CIPA).

Companies who are covered by the CCPA or those concerned about CIPA compliance (on their website) will not want to miss this webinar and the opportunity to hear practical insights on managing risk and adapting to these sweeping changes.

Speakers

Kathleen McConnell, Partner, Seyfarth Shaw LLP
Yana Komsitsky, Senior Counsel, Seyfarth Shaw LLP
Vincent Smolczynski, Counsel, Seyfarth Shaw LLP
Danny Riley, Associate, Seyfarth Shaw LLP

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If you have any questions, please contact Emily Anderson at eaanderson@seyfarth.com and reference this event.

Learn more about our eDiscovery & Information Governance practice.

To request CLE credit please fill out the attendance verification form here. To comply with State CLE Requirements, CLE forms requesting credit in IL or CA must be received before the end of the month in which the program took place. Credit will not be issued for forms received after such date. For all other jurisdictions forms must be submitted within 10 business days of the program taking place or we will not be able to process the request.

Our live programming is accredited for CLE in CA, IL, and NY (for both newly admitted and experienced).  Credit will be applied as requested, but cannot be guaranteed for TX, NJ, GA, NC and WA. The following jurisdictions may accept reciprocal credit with our accredited states, and individuals can use the certificate they receive to gain CLE credit therein: AZ, AR, CT, HI and ME. For all other jurisdictions, a general certificate of attendance and the necessary materials will be issued that can be used for self-application. CLE decisions are made by each local board, and can take up to 12 weeks to process. If you have questions about jurisdictions, please email CLE@seyfarth.com.

Please note that programming under 60 minutes of CLE content is not eligible for credit in GA. programs that are not open to the public are not eligible for credit in NC.

Law.com's Daily Report featured Steven Kennedy, Seyfarth's Atlanta office managing partner, in its Q&A article, “Managing Partner of the Year Finalist: Steven Kennedy, Seyfarth Shaw.” The piece, published on April 13, 2026, spotlights Kennedy as a finalist for the publication’s 2026 Managing Partner of the Year award and discusses his leadership philosophy, accomplishments, and long-term impact on the firm’s Atlanta office. 

In the article, Kennedy describes a leadership approach centered on service and people-first values, noting:

“I would describe my leadership style as servant-oriented and people-first. I lead to serve. My goal in leadership is about creating an environment where people feel supported, challenged, and able to do their best work.”

He further emphasized the importance of being deeply engaged in the work alongside his teams, adding:

“Preparation and attention to detail create confidence, better decisions, and trust. When people know you are willing to do the work alongside them, it strengthens relationships and outcomes.”

The full article is available here.

The recognition highlights the leadership of Lorie Almon, Seyfarth’s chair and managing partner, and Ariel Cudkowicz, managing partner of Seyfarth’s Boston office. Together, they focus on aligning culture, structure, and technology to ensure innovative ideas can be tested quickly and scaled where they deliver client impact.

In a Q&A with Massachusetts Lawyers Weekly, Almon shared guidance for fostering innovation within law firms:

"Start with culture — create accessible pathways for experimentation and recognize small wins. Connect innovation directly to client value so lawyers become advocates. Invest deeply in talent, teaching curiosity, adaptability, and responsible use of technology."

She also offered her perspective on where innovation is headed in the legal industry:

"AI-powered predictive analytics, hybrid talent models, client-facing digital platforms, human-centered legal design, and value-based business models present extraordinary opportunity to elevate lawyers—freeing us for judgment, creativity and empathy. Firms embracing this moment will shape a more dynamic, impactful future."

Read more about the award here. 

In this episode, Michael Cohen, managing partner at Brighton Capital Advisors, joins Dan Evans to discuss the evolving maturity landscape and where stress is building across the market.

Read the full transcript here.

The Property Line™ is a brief and lively discussion of the biggest issues facing the commercial real estate industry. The podcast will deliver insights from Seyfarth's real estate lawyers and other industry leaders on current market trends and how they impact all facets of commercial real estate. 

If you have a question about this topic, ideas for future episodes, or are interested in being a guest speaker, please reach out to us.

Follow us on:  Apple Podcasts  |  SoundCloud  |  Spotify

Welcome back to The Week in Weed, your Friday look at what’s happening in the world of legalized marijuana. This week, we begin in Idaho, where the legislature is not on board with a medical marijuana ballot initiative. Then we turn our attention to Massachusetts, where there’s a ballot initiative to make cannabis illegal again, but new changes to existing law allow possession of more pot. We look at two governors who are urging their respective states to legalize. And finally, we hear from a Senator who is skeptical about medical marijuana.

IDAHO

Idaho’s legislature disapproves of the medical marijuana initiative that may appear on the November ballot. Both the Senate and the House have passed a resolution urging voters to give a thumbs down to legalization. Assuming the initiative does appear on the ballot (not a given – see our report from two weeks ago), it will be very interesting to see if the voters reject cannabis or the advice of their elected representatives.

MASSACHUSETTS

Idaho isn’t the only state where voters and lawmakers seem to be at odds about cannabis. In Massachusetts, however, the roles are reversed. A ballot initiative to recriminalize cannabis is in the works, although polls show it doesn’t have majority support. And now a group of business owners has filed a lawsuit against the initiative, hoping to prevent it from appearing before the voters at all. Meanwhile, lawmakers are heading in the opposite direction. The legislature has passed a bill that would double the amount of cannabis a state resident could buy or possess, along with making changes to the state commission in charge of cannabis.

GOVERNORS IN FAVOR OF CANNABIS

Meanwhile, two governors in states where adult-use cannabis is illegal are speaking out in favor of setting up a retail market. In Pennsylvania, which is largely surrounded by states with full legalization, Governor Josh Shapiro (D) would really like to join that club.

North Carolina, which doesn’t even allow medical marijuana, shares a long border with Virginia, which presumably is about to give the go-ahead for an adult-use retail market. The North Carolina Advisory Council on Cannabis released an interim report on the situation in the state recently, and they indicated that the state needs to set up a market, while making sure kids don’t have access. Governor Josh Stein (D) is on board with that recommendation.

AND FINALLY

Rep. Thomas Massie (R-KY) recently gave an interview to The Cincinnati Enquirer. Among other topics, he discussed his feelings about cannabis, stating that he favored Kentucky being able to decide for itself on legalization, rather than instituting a federal law. He also indicated he preferred “medical margaritas.”

Be well everyone – we’ll see you next week.

Thomson Reuters Westlaw Today featured an article by Seyfarth partners Jennifer Serafyn, Sam Schwartz-Fenwick, and Brandon Dixon, “How can employers design DEI programs that hold up in the face of increased majority group claims?” The article, published on April 10, 2026, examines how employers can reassess and structure DEI initiatives amid a rapidly evolving legal and regulatory landscape.

The authors provide a practical framework for evaluating DEI programs in light of heightened scrutiny under Title VII, recent Supreme Court decisions, and evolving EEOC enforcement priorities. They outline common risk areas—such as restricted mentorship, networking, and development programs—and offer concrete design principles to help employers preserve inclusion goals while reducing legal exposure.

As the authors explain:

“The good news is that well-designed DEI programs remain both legally defensible and organizationally valuable. The challenge is that many programs were launched without the structural scrutiny that the current climate demands.”

The full article is available here.

The article highlights how the booming demand for data infrastructure has intensified the need for careful contract planning, from selecting the right contracting model to allocating risk for design responsibility, procurement, delays, tariffs, and phased construction. Gilchrist and Sherwood emphasize that aligning contract strategy with speed, control, and risk tolerance is critical to keeping high‑stakes data center projects on schedule and on budget. 

Gilchrist and Sherwood underscore the central role contracts play in these complex projects, noting:

“Data centers are built on more than steel and megawatts: They’re built on contracts that allocate risk and keep billions of dollars humming on schedule.”

The full article is available here.

Seyfarth partners Amy Hoang and Teddie Arnold give you the 5 most important takeaways from the March 26, 2026 Executive Order, “Addressing DEI Discrimination by Federal Contractors.”

Tejani highlighted the broader implications of California’s move, noting:

“Nonetheless, California is asserting its independence for how state agencies will govern themselves for procurement and use of generative AI, and I think this EO will have influence in other states.”

The full article is available here.

Corrective Action and Compliance Can End the Case: when fixing the problem ends the lawsuit—for public employers.

In a significant and practical win for public employers, the First Circuit reaffirmed a core constitutional limit on federal courts: once challenged conduct stops, affected employees are made whole, and institutional policies are brought into compliance with governing law, there may be nothing left for a court to decide. Ramos‑Ramos v. Jordán‑Conde, 2026 WL 820731. Federal courts are not compliance auditors for public agencies, and they will not issue retrospective declarations when no effective relief remains available.

That principle drove the outcome in Ramos‑Ramos. There, the First Circuit dismissed a First Amendment challenge to post‑resignation union dues deductions by public‑sector employees—not because the claims lacked constitutional force, but because the dispute no longer presented a live case or controversy. The decision highlights the jurisdiction‑ending power of mootness and shows how corrective action and good‑faith compliance can significantly limit litigation exposure for public employers navigating post‑Janus union‑dues disputes.

Background

In the wake of the Supreme Court’s decision in Janus v. AFSCME, four employees of the University of Puerto Rico resigned their union memberships and requested that dues deductions stop. Despite those requests, deductions continued for years after the employees had resigned. The employees filed suit, alleging First Amendment violations and seeking damages, injunctive relief, and declaratory relief.

As the case progressed, however, the underlying circumstances materially changed. The university and the union stopped the challenged deductions, the union acknowledged that the deductions should have ceased upon resignation, and the district court ordered the union to reimburse all post‑resignation dues, without interest.

By the time the case reached the First Circuit, the employees had narrowed their appeal to a single form of relief: a judicial declaration that the past deductions were unconstitutional and that similar deductions could not occur in the future.

The First Circuit’s Decision

The First Circuit dismissed the appeal as moot, emphasizing that federal courts are constitutionally limited to resolving ongoing, concrete disputes, not issuing abstract pronouncements of law.

1. Declaratory Relief for Past Conduct