International Legal Highlights – October 2018



How to Prepare for and Prevent Data Falsification Issues

Paul M. Thompson

In September 2015, news broke that Volkswagen had manipulated software on its diesel engine vehicles to avoid emissions requirements, a disclosure that led to the largest data falsification case in history. To date, the company has spent more than $34 billion in fines and settlements to deal with the crisis. In addition, a number of its senior executives have either pleaded guilty or been indicted in the United States. But Volkswagen was just the start. For Japanese companies alone, there have been a rash of data falsification cases.

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The General Data Protection Regulation: Key Requirements and Compliance Steps for 2018

Mark E. Schreiber

The General Data Protection Regulation (GDPR) is the biggest story of 2018 in the field of global privacy and cybersecurity. McDermott has covered both the requirements and immediate impact of GDPR before, but its key points bear repeating. The GDPR is enforceable in all EU Member States since May 25, 2018 and expand the territorial scope of EU data protection law. The new regulation introduces numerous changes that will affect businesses’ data processing operations and the way it deals with suppliers, customers and employees. It expressly applies to organizations/ entities established outside the European Union that offer paid or free goods or services to EU data subjects or monitor EU data subjects’ behavior. This gives the GDPR global reach, requiring compliance from organizations around the world, notably in Japan.

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EU General Court Confirms Parental Liability for Non-Pure Financial Investors

On July 12, 2018, by its judgment in Case T-419/14 The Goldman Sachs Group v. Commission, the General Court of the European Union entirely dismissed the appeal brought by the Goldman Sachs Group, Inc., against the European Commission’s decision in Case AT. 39610 Power Cables fining Goldman Sachs more than EUR 37 million for its parental liability for an infringement of EU competition law by one of Goldman Sachs’s former indirect subsidiaries.

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Merger Control in China Following the Termination of Qualcomm/NXP

Joel R. Grosberg

On July 26, 2018, Qualcomm announced the termination of its approximately US$40 billion acquisition of NXP following its inability to obtain SAMR’s approval prior to the end date of July 25, 2018, resulting in Qualcomm being obliged to pay NXP US$2 billion as termination compensation. Although SAMR did not prohibit the transaction, its failure to approve the transaction effectively blocked it. It appears to mark the first time that China’s antitrust regulators have not approved a global transaction that was approved by other global regulators—and, at least potentially, on non-competition grounds. Indeed, the US Federal Trade Commission gave its green light to Qualcomm/NXP without a second request, and the European Commission issued a conditional clearance early on January 18, 2018.

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En Banc Federal Circuit: § 145 Appellants Do Not Have to Pay (Attorneys’ Fees) to Play

David Mlaver

The en banc US Court of Appeals for the Federal Circuit held that a dissatisfied patent applicant that chooses to appeal from a decision of the Patent Trial and Appeal Board rejecting claims of a patent application can appeal to the US District Court of the Eastern District of Virginia without fear of being required to pay the prorated salaries of US Patent and Trademark Office (PTO) employees who work on the appeal, regardless of the outcome. NantKwest, Inc. v. Iancu, Case No. 2016-1794 (Fed. Cir. July 27, 2018) (en banc) (Stoll, J, joined by Newman, Lourie, Moore, O’Malley, Wallach and Taranto, JJ) (Prost, CJ, dissenting, joined by Dyk, Reyna and Hughes, JJ).