Tag Archives: Stillman School

Court Narrows Jurisdiction in Foreign-Bribery Cases

Posted by Brianna McCoy. 

In the very end of August of this year, 2018, a court ruling involving the FCPA could potentially limit the government’s power to go after foreign companies and individuals in bribery cases. This type of court situation is dealt within the U.S. appeals court. The appeals court supported a ruling that tightens and limits the jurisdiction under which prosecutors can bring foreign bribery charges. Attorneys involved in this ruling recognize that “affirming a lower-court ruling that dismissed conspiracy charges against a foreign national accused of facilitating a bribery scheme could have a significant effect on future enforcement,” (WSJ Samuel Rubenfeld). This statement demonstrates the limits of the Foreign Corrupt Practices Act (FCPA). The FCPA was passed in 1977, with the primary purpose to prohibit the payment of bribes, in any form, to foreign officials in order to secure or retain business. It is interesting how this act is for business purposes by American individuals, companies, and issuers of American stock, yet if a foreigner is involved in a corruption scheme while in the U.S. they are also subject to the law.

However, now that there is a narrower view of this statute, the Justice Department is going to see a drawback on their ability to go after foreign companies and foreign individuals. You may wonder where this idea is coming from… This appellate decision is focused “on an individual’s challenge in the foreign-bribery case involving Alstom SA. The French transportation manufacturer agreed in December 2014 to pay $772 million to settle the case, which involved allegations in several countries,” (WSJ Samuel Rubenfeld). Several other people have been charged, one being Lawrence Hoskins, a U.K. national. Hoskins was probed because while he was working for a French unit of Alston, it was alleged that he approved payments to third-party consultants related to a bribery scheme in Indonesia. Luckily for Hoskins, he wasn’t subject to the FCPA because he “didn’t work directly for the U.S.-based unit of Alstom and didn’t participate in the bribery conspiracy while physically in the U.S.” However, the appellate court revised this lower court ruling because prosecutors can argue that Hoskins colluded with the Alstom’s employees while they conducted bribery acts in the U.S., even though Hoskins wasn’t physically in the U.S.

Now, the Justice Department is “reviewing the ruling and considering next steps.” By doing this, questions may come up about whether the U.S. has jurisdiction in an FCPA case earlier in an investigation. In the past, it has been uncommon for an individual to challenge the U.S. government’s affirmation in jurisdiction in an FCPA case, but the appellate decision could provoke more attempts to do so. Because in the past these FCPA settlements have relied on conspiracy theories, now prosecutors will turn toward developing evidence regarding conduct in the U.S. by foreign nationals to bring its FCPA cases. In addition to this, the government may continue its tendency of using money-laundering statue where necessary.

Brianna is a management major at the Stillman School of Business, Seton Hall University, Class of 2021.

Facebook Lawsuit Saying Violent Images Caused Her PTSD

Posted by Jasmine Lightburn.

In this law suit, a content moderator is suing Facebook for causing her post traumatic stress disorder (PTSD). Content moderators are responsible for sifting through often criminal and disturbing posts that users all over the world upload and removing them from the web before the general public sees. She claims that the violent images and other brutal content she viewed caused immense trauma and led to this disorder. The former moderator, Selena Scola, viewed the harshest material ok the web. This included rape, suicides, and other killings every day and claims that she was not protected fairly. According to Scola, the correct psychological services were not in place.

In order to protect other content moderators, Scola urges Facebook to implement effective psychological support services to ensure that employees are receiving the necessary help. She also wants to incorporate mandatory medical testing on a regular basis to further guarantee on site medical attention. She believes that this will reduce the amount of workers who suffer from extreme disorders like herself and other issues that do not get reported or addressed.

In my opinion, Facebook should offer Scola a package deal to cover any medical costs associated with her diagnosis of PTSD. I do not think the company should have to pay any other money other than those costs related to her individual psychological appointments. Moving forward, I agree that Facebook should take deeper measures to monitor the content moderators. In the job description, the company should also include possible health effects that may result from the work that needs to be done. I don’t believe all of the blame can solely be put on Facebook, but they should be responsible for some of what happened.

Jasmine is a business management major with a non-profit minor at the Stillman School of Business, Seton Hall University, Class of 2020.

Article:

The Benefits of Running a Law Firm like a Business

Posted by Marisol Ramirez Ugarte.

In the recent years there has been an upheaval in the legal profession. Legal services, more than ever, are being required by the population. In the rise of employment for attorneys comes the need to manage legal firms in a manner which exploits the large increase in demand.

In fact, speculation on whether legal firms should adopt the structure of corporations has become prominent. According to Frank Carone, executive partner at Abrams Fensterman, “Law firms that are able to consistently bring in high-quality business and ensure that a sizable portion of the revenues go to the bottom line are the ones that will seriously excel” (Prince). He concedes that while the best interests should remain on the clients, the firm should pay attention to growth through the introduction of new legal matters, as well as a focus on profitability. A firm would do well to systematically reach out to potential clients, and referral sources through business development activities. Firms would be able to benefit their client as much as possible, which would in turn provide the greatest profitability for the firm.

Provided that a firm’s management decides to manage the firm like a business, they must consider a key element. The ability to develop and use metrics. The firm’s management would need to clearly identify which areas of law were most profitable, as well as which lawyers participated in the largest monetary gains. Inversely, those areas and attorneys seen as underperforming would need to be identified. In concert with the law firm’s strategic vision, metrics could aid the firm to reach the highest profits through the pursuit of a business model.

Given the success of those firms who have already chosen this path, many others should soon follow suit. I suspect that upon realizing they can continue to serve their clientele to their greatest potential leaders in management will rise to the task with vigor. I find most curious that most firms do not view themselves are businesses; in providing services, albeit legal ones, they are participating in a commercial transaction. Thus, I believe it only natural for the firms to manage as businesses for the benefit of its customers, and the sake of the legal firm.

Marisol majors in finance and philosophy at the Stillman School of Business, Seton Hall University, Class of 2020.

Sources:

https://www.forbes.com/sites/russalanprince/2018/01/29/how-to-dramatically-increase-law-firm-profitability-by-running-the-firm-as-a-business/#5fc6a2d2bd61

Mattress Firms Chapter 11 Bankruptcy

Posted by Deana Curis. 

Mattress Firm has been known as the largest mattress chain in America for several generations. However, it seems that this time is coming to an end. Traditional means of purchasing mattresses are slowly diminishing as online shopping has become more and more popular. Consequently, Mattress Firm has run into the need to file for Chapter 11 bankruptcy. Mattress Firm claims that they will still have timely deliveries and continue to pay suppliers in full, as Chapter 11 bankruptcy allows for companies to keep businesses active while they pay back creditors. The filing of Chapter 11 bankruptcy will ultimately allow Mattress Firm to try and fix the downfalls in their company that had previously prevented them from success.

Again, the availability of online shopping has caused several companies to file for bankruptcy. Brookstone, Nine West, and now even Sears have needed to file for bankruptcy due to “online culture”. In terms of the mattress industry, online platforms, such as Amazon, have put Mattress Firm and other mattress companies at major risk. However, Mattress Firm faces many more issues that prevent them from prosperity. The existence of multiple locations in close proximity to one another is a large matter in question for the company. Luckily, Chapter 11 bankruptcy is frequently used to “reorganize” a corporation, and this is exactly what Mattress Firm plans to accomplish by filing it as well. For example, the company plans to reorganize by closing down seven hundred locations that are in close proximity to others by the end of this year alone. The company also claims that they will use the money that is saved by closing locations in order to overall improve the brand as a whole.

Universally, it is evident that more and more physical stores will be obligated to shut down due to online trends in today’s society. The mattress industry began to plummet with the closing of Sleepy’s, and is now continuing with the filing of bankruptcy from Mattress Firm. Yet, it is not solely the mattress industry that is being damaged by online shopping, but retail and other corporations as well. It is interesting to think about what this may propose for the future of shopping as a whole, and the amount of companies that may also need to file for bankruptcy as a result.

Deana is marketing major, pre-dental track at the Stillman School of Business, Seton Hall University, Class of 2021.

Works Cited
“’A Wake-up Call for Traditional Mattress Chains’: Mattress Firm Files for Bankruptcy.” The Washington Post, WP Company, 5 Oct. 2018, www.washingtonpost.com/business/2018/10/05/wake-up-call-traditional-mattress-chains-mattress-firm-files-bankruptcy/?noredirect=on&utm_term=.c16972a2522b.

Schlesinger v. Ticketmaster

Posted by Leigh Ann Rofrano.

In 2003, a class action lawsuit was filed against Ticketmaster, entitled Schlesinger v. Ticketmaster. The lawsuit claimed that Ticketmaster “failed to fully disclose to consumers all aspects of its UPS and order processing fees” (Ticketmaster). Ticketmaster settled the case in 2013, but the courts did not grant the final approval of the settlement until early 2015. The settlement includes all customers who purchased tickets on Ticketmaster’s website between October 21st, 1999 and February 27th, 2013.

As a part of the settlement, all class members were eligible to receive discount codes or ticket vouchers. Each class member was given a discount code worth $2.25 for every purchase they made during the class period. Class members who used UPS delivery during the class period were provided with a $5 UPS discount code for each purchase that included UPS delivery. Additionally, each class member was given one ticket voucher (which was redeemable for two tickets for an event at a Live Nation venue) for every purchase made during the class period on Ticketmaster’s website.

I choose to research and discuss this case because it is extremely relevant in my life. I am a frequent Ticketmaster and Live Nation customer, as I attend many events every year. The lawsuit was filed against Ticketmaster due to its ridiculously high order processing fees that are tacked onto every ticket. As a Ticketmaster customer, I agree and can attest to the fact that when browsing tickets for events, the magnitude of the order processing fees in not clearly outlined; it is not until you are in the checkout process that you are fully aware of the fees. I was notified through email this past summer about this lawsuit and the discount codes and vouchers in which I was entitled. Many customers were quick to complain that Ticketmaster acted unjustly in notifying customers about the settlement and the class members’ potential benefits. I agree with this argument on the basis that I too was notified of my voucher and discount codes after all of the eligible tickets had been already claimed. I feel Ticketmaster should have notified customers of their vouchers and discount codes sooner, in an attempt to give all class members a fair chance at receiving free event tickets from their vouchers. Overall, I do appreciate the small compensation that was provided to me from the lawsuit, since it is extremely rare to receive discounts on Ticketmaster.com, but would have liked to have been notified earlier and provided with more details about the settlement sooner.

Leigh Ann is a marketing and management major at the Stillman School of Business, Seton Hall University, Class of 2021.

Article Links:

https://insider.ticketmaster.com/frequently-asked-questions-schlesinger-v-ticketmaster/?_ga=2.76895829.1994249424.1539478038-1512211698.1510348971

http://www.ticketfeelitigation.com/

https://www.nytimes.com/2016/06/22/business/media/ticketmaster-lawsuit-vouchers.html

South Dakota v. Wayfair, Inc. (2018) – A Case Brief

Posted by Thomas DeFrancesco.

South Dakota has a state tax for sales of goods and services that are made by retailers of the state. Out-of-state retailers were making sales to customers in the state of South Dakota and not collecting and remitting sales tax in South Dakota. However, these retailers are allowed to do that based on the ruling made in Quill Corp. v. North Dakota, 504 U.S. 298 and National Bellas Hess, Inc. v. Department of Revenue of Ill., 386 U.S. 753. The state was worried they were losing funding due to out-of-state retailers not collecting and remitting the South Dakota’s sales tax. To solve this concern, South Dakota created a law that commanded out-of-state retailers who make more than 200 sales transactions and at least $100,000 in revenue from those sales to collect and remit sales tax as if they were located in South Dakota. Companies who met those requirements failed to follow the newly made law so the South Dakota legislature brought the issue to court.

Should the respondents have to register for licenses to collect and remit the sales tax regardless if they are physically present in the state or not?

South Dakota law is permitted to tax sales from sellers who are outside of that particular state as long as the seller collects at least $100,000 in sales revenue or more than 200 sales transactions.

The court derived its reasoning from other cases including Quill v. North Dakota and National Bella Hess v. Department of Revenue of Ill. The court explained how the physical presence rule in Quill v. North Dakota is “unsound and incorrect.” Since the internet has such a great impact on business, retailers who do business through the internet must pay taxes in that particular state of the sale. Therefore, the Quill v. North Dakota reasoning is no longer relevant.

Thomas is a finance major at the Stillman School of Business, Seton Hall University, Class of 2021.

Source:

https://www.supremecourt.gov/opinions/17pdf/17-494_j4el.pdf

California’s Net Neutrality Bill Passed

Posted by Justin Cunha.

The federal government’s rollback of many different rules has been a highly discussed topic throughout media, however one of the topics that is truly standing out currently is net neutrality. Net neutrality is a principle in which internet services have to treat all data equally and not charge consumers for any specific data. This was put in place by the Obama administration but was removed last year. The event created a lot of outrage as “more than 20 states” have challenged this decision in court (Kang). On Friday August 31, 2018, California lawmakers passed a bill that guaranteed full and equal access to the internet and is the fourth state to create a new net neutrality law.

The state put the bill in place in order to block internet services from slowing down, blocking, or charging for specific services. The bill not only reinstates net neutrality, but it is also even stricter than the one put in by the Obama Administration. The bill would prohibit promotions of free streaming for apps, something that telecommunication companies are pushing to endorse. Prohibiting the promotions would put businesses on a more even playing field, as there are many business who simply do not have the resources to put out these promotions. The change would also ensure that streaming websites all put out the same speed and quality without charging an extra price. These changes are all in an attempt to restrict the amount of power these services have over consumers and the industry. This would be California’s second major internet law in the last year, recently creating a privacy law that allowed users to ask companies such as social media platforms what data they are collecting on them. California is very influential to the rest of the world, with New York already considering a bill similar to this one. One example of the influence the state has was its auto emission laws which inspired many other states to follow in their direction, and in turn giving telecommunication companies worry that something similar will follow.

Though telecommunication companies are attempting to challenge this decision. The companies feel that having these strict rules put on them would hinder their ability to grow and develop. For example, the strict rules will hinder these companies from trying out different business models and thus hurts innovation. Such is the example with the promotion of free streaming for apps, as this was one major experimentation that these businesses wanted to try out. President of US Telecom even argues that, “The internet must be governed by a single, uniform and consistent national policy framework, not state-by-state piecemeal approaches” (Kang). This quote emphasizing that these telecommunication companies want to flow the singular federal law and that these states are simply complicating their business. The companies even went out to promise that they would not slow down or block any websites, a major concern that many consumers had. Telecommunication companies, just like California, do have a lot of influence and power that could possible stop this bill from being implanted. In 2017 they blocked a state broadband privacy bill and are looking to do the same with this bill.

Governor Brown has until the end of September to make his final decision on the matter, and sign his name on the bill. The bill is heavily consumer friendly attempting to give everyone equal access to the internet. This does restrict some freedom of these telecommunication companies, however some restrictions need to be put in place. Power can corrupt and promises can be broken, thus giving these companies too much power can be a scary prospect. So even though there are some flaws with this bill, since it is one of the strictest net neutrality bills, I do believe that California is making the right decision.

Source: https://www.nytimes.com/2018/08/31/technology/california-net-neutrality-bill.html?rref=collection%2Fsectioncollection%2Fbusiness&action=click&contentCollection=business&region=rank&module=package&version=highlights&contentPlacement=1&pgtype=sectionfront

Justin is an accounting major at the Stillman School of Business, Seton Hall University, Class of 2021.

On Drug Pricing, States Step In Where Washington Does Not

Posted by Samantha Staudt.

 

One in five Americans have reported that they have skipped medicine doses or failed to fill a prescription each year because of the cost of the medicine.  This statistic is outrageous and states have to start doing something about it because the federal government will not.  Certain states, like Nevada, have passed a new law that manufactures must disclose more information about why drug prices are rapidly increasing.  In the past few year, prices in Nevada have increased as much as 325 percent, so this law will help regulate the prices of prescription drugs.  Maryland provides another example of steps that must be taken in an order to regulate drug companies.  The attorney general sued generic drug manufacturers whose prices rose more than fifty percent in a year.  States are partly responsible for the funding of the Medicaid program, spending more than 20 million dollars a year on prescription drugs for public employees and prisoners.

Drug manufacturers have recently pushed opioids while denying and misunderstanding their addictiveness.  This may be enough to cut the political power of the pharmaceutical industry.  This statistic is not settling well with anyone and more than 100 states have filed lawsuits against pharmaceutical companies related to tobacco.  This is in an effort to recover the costs of dealing with the epidemic of addiction and overdoses.  Oklahoma’s attorney general, Nolan Clay, is making strides to fixing this rising issue by refusing to accept donations from drug companies.

Of course, pharmaceutical companies fight the big changes that would affect the company.  The industry has been at the top of the lists for lobbying expenditures and campaign contributions at the same time managing to block reform proposals.  During Nevada’s fight to lower drug prices, drug companies hired more than seventy lobbyist to descend on the bill.  When state drug pricing bills pass, the drug industry challenges them in court.  There have been several lawsuits filed, but none have succeeded yet.  In order to prevent drug companies from overpricing prescription drugs, states must enforce regulation laws immediately.

Samantha is a finance major at the Stillman School of Business, Seton Hall University, Class of 2020.

 

 

 

 

The IRS Fears Bitcoin

Posted by Elizabeth Win.

Dollar bills might as well be worth as much as computer paper now. Cryptocurrency has been on the hot seat for the past few months because of its financially growing nature and easy accessibility. Now, as we are starting to see a slow downfall of people investing in Bitcoin; the I.R.S. is starting to detect serious problems with the millennial choice of currency. One of their main concerns is that this cryptocurrency fad has created another giant, financial bubble. If this bubble were to burst, this Bitcoin “bust” could wipe out millions of spectators leading to a huge loss in tax revenue.

A main contender to this potentially huge loss is Bitcoin’s anonymity. For those unaware, Bitcoin’s underlying technology, blockchain, thrives on anonymity. When a person makes a transaction, the transaction only links through an electronic address, making blockchain more attractive to buyers. Now, the I.R.S. has many problems with this missing identification of creative transactions. The anonymity fuels the underground economy, a significant factor in the source of lost tax revenue. Most of the underground economy is conducted through cash transitions; however, what the I.R.S. fears is that cash will slowly transition to cryptocurrencies because of its convenience. An anonymous buyer of bitcoin can easily pay fewer taxes by cheating the cryptocurrency system – also known as major tax evasion. The solution? The government might have to accept the hardships of directly taxing cryptocurrencies and raise tax rates in order to offset the loss of revenue. Understand that the public would highly disagree with this solution, they generated a smarter response: a switch from taxing income when it is received to taxing income when it is spent. Although this switch would require a “major overhaul of the tax code,” many economists support this decision and believe it is future of the economy.

On the contrary, the I.R.S. understands cryptocurrencies offer major reductions in the cost of financial transactions, making it very appealing to the lower classes. There would also be less reliance on banks, which would increase the power of the Federal Reserve to control money. However, the opportunities are too great for tax evasion and illegal operations that the I.R.S. cannot continue to allow it. Although the cryptocurrency economy is growing steadily, it will need to find a way to prevent tax evasion while preserving anonymity in order for it to survive and stay attractive to buyers. For cryptocurrencies to be successful, societies will have to learn to trust the government, a very difficult task for many to grasp. With the rise of extremely advanced technology, it is inevitable that the economy will eventually transition to the cryptocurrency movement. Figuring out how to smoothly transition from worthless green pieces of paper to slick, glassy pieces of technology worth thousands of dollars each, the challenge to adjust will be difficult by eventually necessary.

Elizabeth is a marketing and information technology major in the Stillman School of Business, Seton Hall University, Class of 2020.