Katten ESG Guidepost is a monthly publication highlighting the latest news, legal and regulatory developments involving environmental, social and governance matters.
To read more issues of Katten ESG Guidepost, please click here.
The Current State of Board Diversity Rules
By Johnjerica Hodge, India Williams, Ny’esha Young
In an article published by Agenda, we examine how over the past couple of years, US courts have increasingly been called upon to determine the permissible parameters of board diversity initiatives. These board diversity initiatives have generally taken three approaches: mandated quotas, comply-or-explain requirements and voluntary compliance initiatives. The article looks at how legal challenges have created headwinds for corporate board diversity initiatives. Read Katten’s article.
What Will the New FTC Do With the Green Guides?
By Chris Cole
The new administration is changing the Federal Trade Commission (FTC) leadership. Chair Lina Khan, whose term has expired, is leaving, making way for a new majority of three Republican Commissioners. Andrew Ferguson will become the new Chair and Melissa Holyoak will remain a Republican Commissioner. President Trump has stated that he is nominating Mark Meador to occupy the seat of the departing Chair Khan. If confirmed, Meador will become the third Republican Commissioner. Read about changes for the FTC.
US Treasury and IRS Unveil Proposed Regulations for Commercial EV Tax Credit, Sparking Questions on Recapture Provisions
By Brandon Hadley, Anna-Liza Harris, Chris DiAngelo, John Keiserman, Howard Schickler, Joseph Topolski
On January 10, the US Treasury Department and the US Internal Revenue Service (IRS) released proposed regulations under Section 45W of the US Internal Revenue Code of 1986, which provides a US federal income tax credit (Commercial EV Credit) for the purchase and placing in service of a qualifying commercial electric vehicle (EV) after 2022 and before 2033. The Inflation Reduction Act of 2022 added the Commercial EV Credit to the Code along with two other EV tax credits: the current new clean vehicle tax credit under Code Section 30D (originally enacted in 2008) and the previously owned clean vehicle tax credit under Code Section 25E. Read Katten's advisory.
Wasting No Time: California Joins Europe in the Push for EPR in Fashion
By Cynthia Martens
California Governor Gavin Newsom signed Senate Bill 707 into law last September, creating an incentive for recycling: the Responsible Textile Recovery Act of 2024 is the first extended producer responsibility (EPR) law of its kind in the United States, shifting the cost of textile waste onto producers to promote environmentally friendly business practices. Read Katten's article.
Websites Under Attack — Defenses to ADA Claims for Retailers and Online Businesses
By Kristin Achterhof
Retailers and other businesses with an online presence continue to be targets of lawsuits filed by plaintiffs asserting claims under the Americans with Disabilities Act (ADA) and related state laws. These suits — often postured as putative class action claims — assert that websites are not adequately accessible to individuals with visual impairments. Read Katten's article.
Unsubscribe: What the FTC's "Click-to-Cancel" Rule Means for Retailers and Consumers
By Alexandra Caleca
The FTC seeks to ensure that eager consumers know exactly what they are signing up for and can easily cancel if and when it's no longer wanted. After five years of drafting and public comment, the FTC's final "Click-to-Cancel" Rule recently went into effect, which amended the 1973 Negative Option Rule to target unfair or deceptive practices linked to "subscriptions, memberships, and other recurring-payment programs in an increasingly digital economy where it's easier than ever for businesses to sign up consumers for their products and services." Read Katten's article.
Reminder for Public Companies Granting Stock Options and Stock Appreciation Rights: Don't Forget New Item 402(x) Disclosure
By Farzad Damania, Mitchel Pahl, Alyse Sagalchik, Shira Selengut, Jonathan Weiner, Peter Dalmasy, Neal Patel
As public company issuers prepare for the 2025 reporting season, issuers should be reminded (or made aware) of the new executive compensation-related disclosure requirements. On December 14, 2022, the Securities and Exchange Commission (SEC) adopted rules setting forth new disclosure requirements for awards of stock options and stock appreciation rights (SARs) under new Item 402(x) of Regulation S-K (Item 402(x)). For a public company with a fiscal year that ended December 31, 2024, these new disclosure requirements will take effect beginning with its forthcoming annual report on Form 10-K (or, if applicable, the proxy statement for its annual meeting) to be filed in 2025. Read Katten's advisory.
Corporate Transparency Act Reporting Remains Voluntary
By Walter Weinberg, Scott Vetri, Andrew Jagoda, Phillip Koh, David Matthews, Michael Sherlock, Alex Haddad, Alexander Lovrine
As of January 24, the Corporate Transparency Act's (CTA) reporting requirements remain voluntary. On January 23, 2025, the Supreme Court of the United States (SCOTUS) issued an order that granted the US government's motion to stay the nationwide injunction issued by the US District Court of the Eastern District of Texas in the case of Texas Top Cop Shop, Inc. v. McHenry. This headline appeared to have the effect of reinstating the CTA's reporting requirements and deadlines. Read Katten's advisory.
Is There a Storm Brewing? Unfair Dismissal – A Day One Right In the UK
By Christopher Hitchins, Brigitte Weaver, Emma Williams
The Employment Rights Bill is currently undergoing Parliamentary debate and is expected to be implemented in 2025. One of the key changes our clients are most concerned about is the plan to make the right not to be unfairly dismissed applicable from day one of employment. This will make hiring and firing staff somewhat more challenging. Read Katten's advisory.
The European Data Protection Board Releases Opinion on Artificial Intelligence
By Trisha Sircar
On December 18, 2024, the European Data Protection Board (EDPB) issued an opinion on personal data use in artificial intelligence (AI) in response to the Irish Data Protection Commission's request for more clarity regarding how the EU General Data Protection Regulation (GDPR) applies to AI. Read about the EDPB guidance.
