U.S. Copyright Office Seeks Comments on AI Issues
The U.S. Copyright Office has released a request for comment regarding a number of issues related to AI and copyright policy.
More on this to come.
Trade Associations React Against SEC’s Newly Adopted Private Fund Advisor Rule
A group of trade associations representing the alternative asset management industry has filed a lawsuit against the US Securities and Exchange Commission (SEC) challenging the SEC's recently adopted Private Fund Adviser rule.
The trade associations, including the Managed Funds Association (MFA), argue that the rule will harm investors, fund managers, and markets by increasing costs, reducing competition, and limiting investment opportunities for institutional investors (viz., pensions, foundations, and endowments).
Believing that the new rules goes against the SEC's mission to protect investors and facilitate capital formation, the petitioners highlight three harmful aspects of the rule:
limiting the right of private fund advisers and their investors to tailor their relationships and interactions,
imposing prohibitions and restrictions on certain private fund adviser activities, and
imposing onerous disclosure requirements and administrative obligations.
The trade associations argue that these aspects of the rule go beyond the SEC’s authority under the Investment Advisers Act of 1940 and other applicable laws.
The global alternative asset management industry, which includes hedge funds, credit funds, and crossover funds, has assets under management of $4 trillion. The industry serves institutional investors by providing portfolio diversification and risk-adjusted returns.
The Managed Funds Association (MFA) represents the global alternative asset management industry and advocates for its members on regulatory and business issues. MFA has more than 170 member firms managing nearly $2.2 trillion across various investment strategies.
View source version on businesswire.com.
A General Statement on Privacy
HarvardLaw74.com attorneys are bound by the rules of professional conduct of New York and Texas, which include a duty of confidentiality and attorney-client privilege. As an organization serving clients in and outside the United States, however, we must also comply with the various applicable regulations across the United States and around the world that govern the collection and processing of personal information. Our Privacy Policy is about that duty.
Privacy laws are sectoral in the United States. That is, a patchwork of state laws and sector-specific rules and regulations comprises most of what would be considered privacy law in the United States. California’s Consumer Privacy Act (the “CCPA”) is one of the most wide-reaching state-issued acts. The Health Insurance Portability and Accountability Act (“HIPAA”) is an example of a series of regulatory standards. Internationally, the General Data Protection Regulation ("GDPR") is a model for privacy regimes around the world.
While many privacy laws apply to residents of particular territories (wherever those residents may presently be), as an organization located in both New York and Texas, we have given special attention to the privacy laws of those states. Our lens is also informed by the CCPA and GDPR. When faced with a choice, we have generally adopted the most restrictive provisions across privacy laws. Your own state of residence or applicable jurisdiction may afford you additional protections.
What are the New SEC Private Fund Advisor Rules?
On August 24, the Securities and Exchange Commission (SEC) adopted reforms it had been considering to improve oversight and regulation of private fund advisors. The new rules and amendments are aimed at enhancing transparency, investor protection, and competition within the private fund industry.
Requirements pertaining to private fund advisers registered with the Commission:
Provide investors with quarterly statements detailing certain information regarding fund fees, expenses, and performance;
Obtain and distribute to investors an annual financial statement audit of each private fund it advises; and
In connection with an adviser-led secondary transaction, obtain and distribute to investors a fairness opinion or valuation opinion.
Requirements pertaining to all private fund advisors:
Prohibition from providing investors with preferential treatment regarding redemptions and information if such treatment would have a material, negative effect on other investors. (In all other cases of preferential treatment, a disclosure-based exception is available, including a requirement to provide certain specified disclosure regarding preferential terms to all current and prospective investors.)
Prohibition from charging or allocating to the private fund certain investigation costs where there is a sanction for a violation of the Investment Advisers Act of 1940 or its rules.
In addition, the final rules will restrict certain other private fund adviser activity, unless appropriate specified disclosures are made and, in some cases, investor consent obtained.
Don’t Get Burned by Merchant Cash Advancers
Recent denial of defendant merchant cash advancer’s motion to dismiss by New York court may portend further findings that merchant cash advances (“MCAs”) are loans and criminally usurious under New York law.
Startup Legal Checklist
It’s important to set up your business correctly in order to preserve liability protection and limit your exposure to lawsuits. Startup legal representation typically involves work in one or more of the following areas:
Entity Formation (e.g. C Corp, LLC, etc.)
Initial Capital Structure (Preferred Stock, Common Stock, Debt Instruments, Safe Notes, etc.)
Agreements Between and Among Founding Shareholders and Key Employees
Capitalization Table Maintenance (Carta.com, EQVista, etc.)
Post Seed Funding Rounds
Intellectual Property Protection and Agreements
Vendor Contracts and Software License
Data Privacy and HIPPAA Issues for Digital Health Clients
Social Media Policies and Procedures
It can also include helping to identify what kind of insurance your business might need (general and professional liability, directors and officers, automotive etc.) and assistance in securing such insurance.
If you’re a founder or business owner, a legal professional can help you set up your business properly. If you have already set up or begun to set up your business, a legal professional can identify and address any errors or gaps in your business' organization.
The material in this article is solely intended to provide general information. It is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. We, of course, welcome the opportunity to assist you.
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