Chipotle and the Need for HR Oversight In Settlement Avoidance Strategies

By: Matthew Lowe


When litigation looms for large corporations, settlement becomes a key part of the strategy discussion. In order to avoid the costliness associated with, and reputational damage from, lengthy trials, it is not unexpected for a company to dip into its litigation budget and pay a premium to avoid the hassle. Some companies, however, adopt the opposite strategy: settlement avoidance. If a company is to adopt such a strategy, it will also need to adopt proper defensive measures, such as the implementation of adequate Human Resources (“HR”) oversight, in order to effectively ride out the storm of the trial.


Following Chipotle Mexican Grill, Inc. (“Chipotle”) going public in January of 2006, it came to be known as an “industry darling”.[1] Recognized for its transparency and its commitment to utilizing farm-fresh, high-quality ingredients, Chipotle was a trendsetter and leader in the fast-casual movement in dining.[2]Read the rest

New Legal Problems Created by Wearable Devices

By: Young Ah Kim

I. Introduction

Wearable devices have been drawing serious attention in the media as the next big thing since Google glass, a wearable device with an optical head-mounted display, was launched in 2013.[1] Fitbit, the maker of fitness-tracking wristbands, went public in 2015 after its sales rose 174% to $745 million in 2014.[2] Since GoPro’s initial public offering in 2014, the maker of the action camera has climbed over 100% from its top-of-the-range IPO price-per-share.[3] Apple unveiled the Apple watch that can monitor heart rate and activity and create a one-stop shop for health information of consumers.[4] Apple CEO Tim Cook called the Apple Watch “the most personal device we’ve ever created.”[5] According to Statista, an Internet-based statistics provider, “the global wearable device market is expected to grow from $5 billion in 2014 to $12.6 billion by 2018.”[6] In a 2014 … Read the rest

The Best Offense Is a Good Defense: The Strategic Value of Building a Strong Corporate Culture

By: Matthew Lowe

I. Introduction

In 2014, a University of Virginia Law Professor, Brandon L. Garrett, wrote a book entitled: Too Big to Jail: How Prosecutors Compromise with Corporations. In his book, Garrett inadvertently outlined a strategy for companies to follow, which would allow them to increase morale and productivity while also putting measures in place to avoid damaging litigation. Relying on the development and successful implementation of a healthy, viable corporate culture, the benefits of this strategy should serve as the catalyst for wide scale adoption.

II. Background

In the 1930s, a Republican attorney by the name of Conrad Printzlien left his position in the district attorney’s office in the Eastern District of New York to work as a probation officer.[1] While this voluntary career shift meant a 50% salary reduction, Printzlien accepted the position partially due to the urging of the court, but also because he … Read the rest

Unnecessary Toughness: Throwing the Flag on the NFL’s New Personal Conduct Policy

By: Jack Meyer

In the wake of the Ray Rice incident and subsequent domestic violence arrests involving several other NFL players during the 2014 season, the NFL encountered a public relations firestorm. The NFL faced widespread public criticism that domestic violence among NFL players had become an “epidemic” and that the male dominated league was indifferent to the issue.[1] Commissioner Roger Goodell nearly lost his job after his perceived mishandling of the Rice incident, and public pressure forced the NFL take significant action to address domestic violence offenses among its players.[2]

This pressure led the NFL to hastily implement a player conduct policy specifically aimed at addressing crimes against women, such as domestic violence and sexual assault. The NFL admittedly used this new policy as a public relations maneuver, knowing full well that the policy did little to actually prevent domestic violence and was only aimed at publicly … Read the rest

Practical Tips to Comply with SEC Beneficial Ownership Reporting Requirements

By: Clyde Tinnen, Partner, Kelley Drye & Warren LLP – Clyde Tinnen is a partner in the Chicago office of Kelley Drye & Warren LLP. He focuses his practice on corporate law matters, including finance and securities law.  Any questions relating to topics discussed in this article may be directed to the author at

Practical Tips to Comply with SEC Beneficial Ownership Reporting Requirements

On September 10, 2014, the Securities and Exchange Commission announced charges against 28 officers, directors, or major shareholders for failure to promptly file Form 4 and Schedule 13D and 13G reports, resulting in financial penalties totaling $2.6 million.  Six publicly-traded companies were charged for contributing to filing failures by insiders or failing to report their insiders’ filing delinquencies. SEC enforcement staff used quantitative data analytics to catch the violators. The news came as a shock to many practitioners given the Commission’s historically passive stance on … Read the rest

Government Gone Overboard With Sarbanes-Oxley

By: Austin Root 

               For most, it would be a stretch to compare the acts of a corporate executive who shredded company documents in order to cover up financial fraud with those of a fisherman who threw a few undersized red grouper fish back into the sea.  For the Department of Justice, it is not stretch at all as both are guilty of the same crime.  Should the Supreme Court agree with this comparison, there will surely be vast waves that disturb the business landscape.

Act One

In October of 2001, a scandal was revealed at the American energy company, Enron Corporation, which eventually led to the company’s bankruptcy, dozens of charges against its executives, and the dissolution of Arthur Anderson, one of the largest audit and accountancy partnerships in the world.[i]  Enron was able to hide billions of dollars in debt through misleading financial statements while portraying themselves Read the rest

The Contraceptive Mandate: Birth Control or Business Control?

The Supreme Court heard oral arguments on March 25th, 2014, on the Tenth Circuit Case Hobby Lobby Stores, Inc. v. Sebelius and the Third Circuit Case Conestoga Wood Specialties v. Sebelius; a ruling is expected in late June.[i] Hobby Lobby and Conestoga are two prominent examples from over 71 cases involving for-profit businesses challenging the contraceptive mandate in the Patient Protection Affordable Care Act (ACA) on the grounds that this provision violates their religious beliefs under the First Amendment Free Exercise Clause, Establishment Clause, and the Religious Freedom Restoration Act (RFRA).[ii] Specifically, the contraceptive mandate requires that “all health insurers and non-grandfathered group health plans that offer group or individual coverage for certain preventative cost services for women without cost-sharing.”[iii] A verdict for the government has large implications for for-profit businesses such as Hobby Lobby opposing the mandate.  To explain, “The companies could face steep $100-a-day Read the rest

National Security Space Launch: No Contest

             Competition and innovation are key ideals in American society, and they were the main focus on March 5, 2014 when the CEOs of SpaceX and United Launch Alliance (“ULA”) testified before the Senate Appropriations Subcommittee on Defense.[1] The ULA, a joint venture between aerospace giants Boeing and Lockheed Martin, currently provides launch services for the U.S. National Security Space Launch programs.[2] SpaceX, a relative newcomer to the space launch business,[3] is seeking to break ULA’s current monopoly on national security launches and open the procurement process to other launch providers.[4]     

The EELV Program

            In 1994, the U.S. Air Force initiated the Evolved Expendable Launch Vehicle (“EELV”) program to ensure that the U.S. military and civilian national security organizations would have reliable access to Earth’s orbit for spy satellites, military communications, and other important payloads.[5] As … Read the rest

Lessons from Hartney: How to Reduce Tax Forum Shopping by Illinois Retailers

            The Illinois’ Local Retailers’ Occupation Tax Acts (ROT Acts) allows “municipal governments and the Regional Transportation Authority (RTA) to impose a retail occupation tax ‘upon all persons engaged in the business of selling tangible personal property at retail within the county, municipality, or metropolitan region.”[i] Leading up to the recent Illinois Supreme Court decision in Hartney Fuel Oil Co. v. Hamer, a number of Illinois retailers with selling activities in multiple jurisdictions sought to pay Illinois Local Retailer Occupation Taxes only in the lowest tax rate jurisdictions where they accepted purchase orders, even when their predominant selling activities occurred in other places.[ii]  This narrow interpretation of the “business of selling” in the ROT Acts complies with the Department of Revenue (DOR) regulations regarding the Acts, which establish a bright-line rule for purchase order acceptances.[iii]

            Although the ability to tax Read the rest

Family Leave in the United States: Time for a Change?

On February 5, 1993, the Family and Medical Leave Act of 1993 (“FMLA”) was signed into law by Bill Clinton, mandating 12 weeks of unpaid family leave for companies with over 50 employees, if the employee has worked at least 1,250 hours during the last 12 months with the company.[1] In its findings, Congress specifically recognized the importance of parent participation in early childhood and the lack of job security available to working parents, and sought to give new parents more flexibility with work-life balance.[2] Since the FMLA was passed, the United States has fallen far behind other developed countries in providing leave for new parents. After more than 21 years, U.S. lawmakers should reexamine the national family leave policy and increase the benefits guaranteed for family leave. A more generous family leave policy is not only good for individuals and families, but also good for business.… Read the rest