Yesterday, a group of merchants moved, on First Amendment Grounds, to enjoin a New York law that allows merchants to charge different prices for cash and credit card purchases, but prohibits them from calling the extra charge for credit card purchases a “surcharge”: The motion begins:
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Preliminary Injunctions
Judge Engelmayer Preliminarily Enjoins Insurer from Cutting off Advancement of Hedge Fund’s Legal Fees
By Matthew Popowsky on
In an opinion issued yesterday, Judge Engelmayer granted the motion of Level Global and the hedge funds’ management team to preliminarily enjoin their insurer, XL Specialty Insurance, from cutting off the advancement of legal fees. After Level Global and its managers became the subject of a criminal insider trading investigation by the U.S. Attorneys’ Office in 2010, XL began advancing defense costs in connection with the investigation. On January 18 of this year, a day after indicting Level Global founder Anthony Chiasson, the U.S. Attorneys’ Office unsealed a guilty plea of a mid-level Level Global employee on insider trading charges. In the guilty plea, the employee allocuted to the following facts:
From 2007 to 2010 I agreed, with others, to commit securities fraud. Namely, I agreed to obtain, directly and indirectly, material non-public information from employees of public companies. I knew that the inside information I received was disclosed by the company employees in violation of duties of trust and confidence. I agreed to share that information with the other individuals at other companies as well as with others at the hedge fund where I worked. When I gave the inside information to the others at the hedge fund where I worked, I knew the information would be used to execute trades. Moreover, I did in fact obtain such information and provide it to others. For example, on August 27, 2008, I spoke with others at the hedge fund where I worked and discussed with them inside information that I obtained indirectly from an employee at [Dell].
On March 5, XL informed Level Global and its management that it would no longer advance legal fees as a result of the facts admitted in the guilty plea. The XL insurance policy that covered Level Global’s defense costs had been executed in April 2010, at which time Level Global’s general counsel had certified that no one at the firm had knowledge of any facts or circumstances that would give rise to a claim against Level Global. Based on the plea allocution, XL stated that an individual at the fund necessarily had knowledge of the facts that gave rise to the very claims against which Level Global and its management were defending, and thus XL was not required to pay costs associated with those claims. XL told Level Global that it would not advance further funds and asked Level Global to return all funds advanced — nearly three-quarters of the $10 million policy. On the same day it sent Level Global its letter, XL filed a lawsuit seeking a declaratory judgment that it was not obligated to advance funds and was entitled to restitution of funds advanced.
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Broadcasters Attempt to Distinguish Aereo’s Internet-TV Service from DVRs in Reply Brief
By Matthew Popowsky on
As we previously reported, the preliminary injunction hearing between Internet TV start-up Aereo and the major network broadcasters went forward last week before Judge Nathan. Yesterday, the broadcasters got presumably their last bite at the apple, with a reply brief in further support of their original motion for the injunction. In the brief, the broadcasters take on Aereo’s argument that Internet streaming of live TV (on a seven-second delay) is akin to the “time-shifting” function of a DVR or VHS, and thus protected under the Supreme Court’s historic Sony decision and the Second Circuit’s holding in Cartoon Network v. CSC Holdings (“Cablevision“). In contrast to the recording devices at issue in those cases, the broadcasters argue, Aereo’s service does not permit individual users to copy specific programs for later consumption. Instead, Aereo itself captures the over-the-air (“OTA”) signals of broadcast television and then retransmits them to subscribers over the Internet. In addition, Aereo’s service allows consumers to view copyrighted content in a completely different medium — on computers or handheld devices over the Internet, rather than on televisions — which the broadcasters claim puts the Aereo service outside of the scope of Sony and Cablevision.
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Preliminary Injunction Hearing in Aereo Case Goes Forward Today
By Matthew Popowsky on
Today, after extensive, fast-paced briefing from both the parties and potential amici, Judge Nathan will hold a preliminary injunction hearing that will decide, at least for the short-term, the fate of internet television start-up Aereo. As we explained in an earlier post, Judge Nathan has already dismissed the plaintiffs’ state law unfair competition claim as preempted by the Copyright Act. Now, the Court will be asked to determine whether Aereo’s service violates the Copyright Act itself.
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Government Moves Judge Forrest to Reconsider Injunction Against Detention Authority
By Charles Michael on
This evening, the government moved to reconsider Judge Forrest’s order preliminarily enjoining the government from enforcing a federal law authorizing the government to detain persons, including U.S. citizens, who “substantial[ly] support” Al-Qaeda, the Taliban or their “associated forces.” As summarized in a prior post, Judge Forrest’s ruling was heavily influenced by the fact that the government would not agree at the injunction hearing that the conduct of the plaintiffs, a group of journalists and civic activists, would fall outside the law. The government’s motion’s first explains that, as a general matter, the conduct the plaintiffs described in their affidavits would not subject them to detention:
To eliminate any doubt, the government wants to be as clear as possible . . . . As a matter of law, individuals who engage in the independent journalistic activities or independent public advocacy described in plaintiffs’ affidavits and testimony, without more, are not subject to law of war detention as affirmed by section 1021(a)-(c), solely on the basis of such independent journalistic activities or independent public advocacy.
But the government states that it should not be required to give more specific assurances than that:…
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