S&C Critical Insights

Pharmaceutical Deal Outlook: U.S. and European Perspectives

In the webinar “Pharmaceutical Deal Outlook: U.S. and European Perspectives,” Frank Aquila, Matt Hurd, Carsten Berrar, Olivier de Vilmorin and Jeremy Kutner discuss the outlook for M&A deals in the sector. The group of partners, who came together from S&C’s New York, Frankfurt, Paris and London offices, focus in particular on outlining how patent law impacts the tenor of mergers and acquisitions, how the regulatory landscape in both the United States and Europe is affecting dealmaking, and the different considerations for acquirers as opposed to sellers.

Implications of EU Court of Justice Judgment in the Fiat Case for Future State Aid Investigations

In this episode of S&C’s Critical Insights, Juan Rodriguez, Co-Head of S&C’s European Competition Group and the Firm’s Antitrust Group, and associate Marielena Doeding discuss the European Court of Justice’s ruling in the Fiat case and its implication for future state aid investigations. This landmark judgment—in which the Court of Justice annulled a General Court judgment and European Commission decision –clarified the parameters under which the Commission may investigate individual tax rulings under state aid rules. Although the judgment reaffirms that the Commission may investigate tax measures for compliance with state aid rules, in doing so, it cannot apply its own version of the arm’s length principle to tax measures; in particular, it cannot apply the arm’s length principle to tax measures in jurisdictions unless – and then only to the extent that – the law of the jurisdiction incorporates that principle. Instead, the Commission must carefully consider national tax rules to assess whether or not a measure confers a selective advantage for state aid purposes.

Sullivan & Cromwell represented Fiat in this litigation. 

The Impact of COVID-19 on Consumer and Retail M&A

In this episode of S&C’s Critical Insights, partners Audra Cohen, Frank Aquila and Melissa Sawyer share important updates for dealmakers in the consumer and retail sector following the COVID-19 pandemic. Frank and Melissa discuss the impact of support legislation on various business models and explore how a continued shift in consumer priorities and product availability might change fundamental aspects of future M&A in these industries.

M&A and Deal-Making Implications of the FCPA Resource Guide, Second Edition

In this episode of S&C’s Critical Insights series, Sergio Galvis, head of the Firm’s Latin America practice, outlines best practices for companies making cross-border acquisitions in view of updates to the FCPA Resource Guide issued by the U.S. Department of Justice and the Securities and Exchange Commission. With increased cooperation by regulators and law enforcement authorities across jurisdictions leading to more enforcement actions, acquirers should reevaluate their due diligence and compliance programs under these guidelines. Sergio addresses topics including: • designing and implementing an effective risk-based due diligence program for M&A, • the benefits of voluntary disclosure to the authorities of potential corruption issues, • the implementation of an effective compliance program, and • the importance of integration and remediation under the guidelines.

French Financial Authority Proposes New Measures for Shareholder Activism

In this episode of S&C’s Critical Insights podcast series, Olivier de Vilmorin, head of the Firm’s European M&A practice, discusses the measures proposed by France’s securities regulator, the Autorité des marchés financiers (the “AMF”), concerning shareholder activism. Following a growing number of activist campaigns in France over the past several months, the AMF has clarified its position with pragmatic and constructive proposals to better control excessive behavior in shareholder activism campaigns, without preventing them. Olivier explores how these proposals will improve transparency and dialogue between shareholders and issuers and also strengthen AMF’s response capabilities during activist campaigns.

Fiduciary Duty Conversations During COVID-19: Ways to Save a Business

S&C partners Jim Bromley and Andy Dietderich, the co-heads of our Global Restructuring practice, discuss strategies for boards confronting the “zone of insolvency” during the COVID-19 crisis.

European Capital Markets Activity During COVID-19

S&C partners Carsten Berrar, Krystian Czerniecki and John Horsfield-Bradbury discuss the impact of the COVID-19 crisis on capital raising in Europe, and how issuers can adjust structures to address the current situation.

Implications of Recent U.S. and EU Critical Mineral Legislation

In this episode of S&C’s Critical Insights, Inosi Nyatta, Craig Jones and Sam Saunders discuss new and proposed regulations involving critical minerals in the United States and European Union. Critical minerals, referred to as critical raw materials in the EU, are generally defined to include, among others, cobalt, graphite, lithium, manganese, nickel and rare earth minerals and are key components to clean energy technologies (in particular batteries) and other high-tech products.

 

In the United States, the Inflation Reduction Act (IRA), which was passed in August 2022, provides an estimated $369 billion in investments in energy security and climate change programs and also creates significant tax incentives for critical minerals to be extracted, processed and/or recycled in the United States or countries that are trade partners with the U.S.

 

Proposed by the European Commission in March 2023, the Critical Raw Materials Act (CRMA), aims to secure the EU’s supply of critical raw materials and bolster Europe’s own extraction, processing, refining and recycling of strategic raw materials. The CRMA would create a European Critical Raw Materials Board, set EU-wide targets for annual consumption of strategic raw materials, and establish a streamlined permitting process for strategic projects. However, unlike the IRA, it does not provide any additional funding.

DOJ Updates Corporate Compliance Guidance

In this episode of S&C’s Critical Insights podcast series, Alex Willscher, Deputy Managing Partner of S&C’s Criminal Defense and Investigations Group, and Aisling O’Shea, co-head of the Firm’s FCPA and Anti-Corruption Group, discuss recent changes to the U.S. Department of Justice Criminal Division’s guidance on its evaluation of corporate compliance programs. Alex and Aisling identify key changes from the DOJ’s guidance this past April, unpack what the DOJ may be attempting to achieve with these changes, and explore considerations for corporate legal, compliance and other professionals in light of these updates.

A Discussion of Recent Federal Arbitration Act Decisions

In this episode of S&C’s Critical Insights, Annie Ostrager and Diane McGimsey, Co-Heads of S&C’s Labor & Employment Group, discuss two recent decisions from the U.S. Court of Appeals for the Second and Ninth Circuits involving preemption and Section 1 of the Federal Arbitration Act. They analyze how those courts interpreted two recent U.S. Supreme Court decisions addressing the FAA’s scope in the employment context: Viking River Cruises v. Moriana and Southwest Airlines v. Saxon.

In Bissonnette v. LePage Bakeries Park St., the plaintiffs, who delivered baked goods to stores and restaurants, claimed they were transportation workers, which would exempt them from Section 1 of the FAA. The Second Circuit held that because the plaintiffs charged for the baked goods, the transportation was incidental and the plaintiffs were in the baked goods industry and therefore not excluded from the FAA. After the Supreme Court issued its Saxon ruling a month later, the Second Circuit panel reconsidered Bissonnette, but adhered to its original ruling, which affirmed the district court order compelling arbitration.

In Chamber of Commerce v. Bonta, a divided Ninth Circuit panel examined a California law, A.B. 51, that broadly prohibits employers from requiring mandatory arbitration agreements. Reversing a district court, the majority held that the A.B. 51’s restrictions are valid but could not be enforced if an unlawful agreement was entered into.

After the Supreme Court issued its ruling in Viking River Cruises, the Ninth Circuit panel reheard the case and came to the opposite conclusion, upholding the district court’s injunction against A.B. 51.

Annie and Diane said that in light of the Chamber of Commerce ruling, they expect California employers who had temporarily gotten rid of their arbitration agreements to be revising those policies. The Saxon and Bissonnette decisions left things less clear, but clients may wish to reexamine arbitration agreements to ensure employees’ work is characterized properly.