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Charles Michael

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Charles Michael is an accomplished commercial litigator who resolutely defends clients in high stakes disputes and arbitrations. He is also experienced in regulatory and criminal investigations, and represents clients under investigation by the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), the Commodity Futures Trading Commission (CFTC), and the Department of Justice (DOJ).

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In an opinion yesterday, Judge Gardephe dismissed a complaint (see our prior coverage here) brought by Liberty Tax Service against the makers of the TV show “Better Call Saul” for depicting an allegedly similar business, “Sweet Liberty Tax Services,” as a criminal enterprise. In the show, the business is run by Craig Kettleman, who had been convicted of embezzlement in an earlier season but then opened “Sweet Liberty Tax Services” with his wife after being released from prison.

Under Second Circuit law, using a mark in this way is protected so long as it is artistically relevant and not explicitly misleading. Judge Gardephe agreed with the Defendants that the “Sweet Liberty” name was artistically relevant insofar as it was intended to be “richly ironic”:Continue Reading Judge Gardephe: Better Call Saul’s Fictional “Sweet Liberty” Tax Firm Does Not Infringe Rights of Similarly-Named, Real Business

In an opinion yesterday, Judge Castel denied a summary judgment motion that sought to dismiss the defamation action brought by former prosecutor Linda Fairstein against Netflix and others over a “docudrama” called “When They See Us” about the Central Park Five.  Our coverage of the denial of the motion to dismiss is here.

Judge Castel recognized that the makers of films and television shows dramatizing real events have some license to advance an “opinion-based version of events, provided that the account has some support in the historical record.” He also noted that, while docudramas will often use “composite” characters, “Fairstein does not complain that she was defamed through the use of a fictionalized composite character. Her claims are directed to words and deeds attributed to her by name.”

The decision details why a jury could find that five particular scenes were capable of defamatory meaning and were made with “actual malice.”

In the first example, Fairstein is depicted as creating a timeline of the underlying attack, and then manipulating it to fit a predetermined conclusion that the “Central Park Five” were guilty:Continue Reading Judge Castel Denies Summary Judgment to Netflix in Defamation Case Over Central Park Five “Docudrama”

In the SEC’s closely-watched action against the crypto firm Ripple, Judge Torres on Thursday issued a summary judgment decision finding that some types of sales of Ripple’s crypto token, XRP, were governed by the securities laws while others were not. The decision is a notable counterweight to the SEC’s effort to broadly categorize crypto transactions as falling under the securities laws.

The key issue was whether the underlying transactions met the definition of the “investment contracts” as interpreted by the Supreme Court’s decision in SEC v. W.J. Howey Co., 328 U.S. 293 (1946). Under Howey, a transaction is an investment contract if there is “a contract, transaction or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party.”

For XRP’s sales to institutional investors, Judge Torres found that the Howey test was met because the investors paid money to Ripple, which then “used the funds it received from its Institutional Sales to promote and increase the value of XRP by developing uses for XRP and protecting the XRP trading market.”

Sales on digital asset exchanges were different, however, because the purchasers (referred to as “Programmatic Buyers” in the opinion) did not even know if the funds were going to Ripple:Continue Reading Judge Torres: Sales of Ripple’s Crypto Tokens on Exchanges Are Not Securities Transactions

In an opinion Tuesday, Judge Carter issued an injunction against New York’s newly-enacted online hate speech law (see our prior coverage here).

The law would require social media platforms to develop policies for addressing, and responding to user complaints about, “hateful conduct.”  Judge Carter found that, in doing so, the law impermissibly compelled the challengers — Rumble and other “pro-free speech” online platforms — to engage in speech with which they disagreed:Continue Reading Judge Carter Enjoins New York’s New Online Hate Speech Law on First Amendment Grounds

A jury returned a verdict yesterday of approximately $130,000 against Mason Rothschild, the creator of a series of non-fungible tokens, or NFTs, associated with digital images of Hermés’s “Birkin” handbags covered in fake fur (see our prior coverage here).

Rothschild argued that the NFTs were protected artistic expression under the First Amendment.  Judge Rakoff denied both sides summary judgment as to that and other issues, and ultimately instructed the jury that the First Amendment question turned on whether Rothchild was intentionally trying to confuse customers and thereby capitalize on Hermés famous brand, or instead created the project for artistic reasons:Continue Reading Jury: “MetaBirkins” NFTs Violate Trademark Rights of Handbag Maker Hermés

Judge McMahon issued a written Order on Friday, answering the parties’ questions ahead of a bench trial in an ERISA case, and, in doing so, offered helpful guidance as to her practices in bench trials.

First, she was clear she does not want opening statements, and perhaps not even closing statements:Continue Reading Judge McMahon Ahead of Bench Trial: “Last Thing I Need Is Opening Statements”

Judge Carter will hold a preliminary injunction hearing next week in a case challenging, on First Amendment grounds, a new New York law (N.Y. Gen. Bus. L. § 394-ccc) that requires social media platforms to develop policies for addressing, and for responding to user complaints about, “hateful conduct.”

The challengers are operators of online platforms who argue that they should not be forced to police what the state vaguely defines as “hateful” conduct. Merely having to separately define what is “hateful” conduct, and provide special treatment to users who complain about conduct meeting that definition, amounts to an endorsement of the State’s views, according to the challengers:Continue Reading Judge Carter to Hold Hearing Next Week on Whether to Enjoin New York’s New Online Hate Speech Law

In an opinion yesterday, Judge Liman granted — albeit with clear reluctance — the government’s motion to dismiss a case brought by former Trump attorney Michael Cohen against various government offices who allegedly retaliated against him for planning to publish a book critical of former President Trump.

Cohen was placed on furlough during his prison sentence, but then suddenly, while negotiating the terms of a transition to home confinement with probation officials, was remanded to prison.

In July 2020, Judge Hellerstein granted Cohen release via an Order stating:

The Court finds that Respondents’ purpose in transferring Cohen from release on furlough and home confinement back to custody was retaliatory in response to Cohen desiring to exercise his First Amendment rights to publish a book critical of the President and to discuss the book on social media.

In the case before Judge Liman, Cohen was suing for damages, primarily by asserting so-called Bivens claims against the federal government. Judge Liman found that the Supreme Court’s more recent interpretations of Bivens — essentially that no Bivens claim can proceed if by statute there is any other remedy, no matter how small — barred Cohen’s lawsuit.

But Judge Liman noted that the result worked a form of “violence” to Cohen’s constitutional rights:Continue Reading Judge Liman Laments Supreme Court Precedent Barring Damages Remedy For DOJ’s Retaliation Against Michael Cohen for Planned Book About Trump

In an opinion Friday, Judge Abrams approved an SEC settlement, but wrote that she would “not do so silently,” because she found highly “troubling” the SEC’s standard, non-negotiable provision requiring that the defendant not make “any public statement denying, directly or indirectly, any allegation in the complaint or creating the impression that the complaint is without factual basis”:
Continue Reading Judge Abrams Harshly Criticizes SEC’s “Lifetime Gag” Settlement Requirement