The Tech Group

Kathleen A. McGee, former director of the New York City Office of Special Enforcement, comments to Bloomberg about that agency’s attempts to restrict Airbnb short term rentals. In an article detailing New York’s high number of illegal listings and unpaid fines, McGee says that “[tightening rules on these kinds of rentals] has been on the city’s radar for over 10 years.” (subscription required to access article)

Matt Savare comments in the New York Post that—in connection with brand safety in the digital ad industry—the list of prohibited content has grown dramatically in recent years, and now includes “disinformation,” which has had a chilling effect on certain types of content/viewpoints.

Matt Savare, partner in Lowenstein’s Technology & Media Transactions and Tech Group, chair of its Commercial Contracts practice, and Vice Chair of Lowenstein Crypto, comments in Law360 on the suit filed by pop singer Rick Astley alleging a violation of his right of publicity under California state law by rapper Yung Gravy who used an impersonator imitating Astley’s voice from the hit “Never Gonna Give You Up” on Gravy’s song, "Betty (Get Money).” Savare doubts that Astley’s suit details a sufficient cause of action, saying: "Here, the plaintiff does not allege any commercial use of his voice, so it may be difficult to win on a publicity claim.”

Kathleen A. McGee, former Bureau Chief of the New York Attorney General’s Bureau of Internet and Technology, discusses the National Institute of Standards and Technology’s newly released AI Risk Management Framework in Bloomberg Law, calling it a “harbinger of things to come from the regulatory perspective.” She adds: “I think you can expect regulators to turn to things like this NIST framework for action plans, really, on how to evaluate whether or not a particular entity becomes a target.”

M&A Navigator and Private Equity Wire report on Lowenstein’s representation of Abacus Group in the acquisition of two boutique cybersecurity consulting companies, Gotham Security and its parent company, GoVanguard. Abacus is the leading provider of hosted IT services and solutions to alternative investment firms. The Lowenstein deal team included Brendan J. Koeth, Fernando Burman, Storme McKop, Tolulope Adetayo, Oluwaseyi O. Amorin, Jessica I. Kriegsfeld, Darren Goodman, Rachel Ingwer, Mark P. Kesslen, Manali Joglekar, and Anthony O. Pergola.

Law360 reports that Anthony W. Raymundo has been named managing partner of the firm’s Palo Alto office. Lowenstein Chair and Managing Partner Gary M. Wingens says: "Anthony's experience in tech and venture capital investment make him a natural choice to strengthen the impressive foundation Lowenstein Sandler has built over the last 14 years in the heart of the technology industry.” The story was also reported by Reuters, Bloomberg Law, Daily Journal, and Attorney-at-Law. 

Meredith Beuchaw and Ed Zimmerman of Lowenstein’s Tech Group provide input on best practices and considerations for startup founders in the M&A process in an article in TechCrunch by Vishal Lugani, general partner and co-founder at Acrew Capital. The article provides a suggested timeline to accommodate the need for startups to build relationships with potential acquirers, comply with governance requirements, conduct due diligence, and negotiate key deal terms; it also recommends the best way to choose an acquirer, reach consensus among stakeholders, manage legal issues, and maintain momentum towards closure. (subscription required to access article)

Law360 included Matt Savare’s article “Exploring Publicity Rights For Virtual Avatars” in its list of top guest articles about the metaverse in 2022. Savare addressed the intellectual property issues raised by advertising in the virtual world, and whether a right of publicity claim could one day be brought for the unauthorized use of an avatar.

Kathleen A. McGee, partner in Lowenstein’s White Collar Criminal Defense practice and The Tech Group and former Bureau Chief of the New York Attorney General’s Bureau of Internet and Technology, discusses with Quartz possible violations by Elon Musk of consent decrees between Twitter and the Federal Trade Commission (FTC) concerning the company’s use of personal data. Musk’s recent announcement of “self-certification” of compliance may expose the company to onerous fines and more, says McGee. She says: “It is not just about risking punitive financial damages… It is about setting precedent and giving a powerful regulator—and frankly legislators—ammunition to further pursue legal action that restricts a company’s ability to innovate or come up with new applications.” The article also ran on Yahoo Finance.

Madhumita Datta, Ph.D. is interviewed in The Hot Seat about how and why she became a patent attorney, her advice for others entering the field, and the challenges and opportunities facing women attorneys in the technology sector. She also describes her pro bono work on behalf of WANDA (Women Advancing Nutrition, Dietetics and Agriculture), a non-profit organization that focuses on promoting healthy eating among African American diaspora harnessing ancestral food knowledge.

Datta emphasizes the importance of “science/engineering knowledge, ability to pick up a new area of technology fast, and interpersonal skills to connect with the inventors, in-house counsels, and the patent office Examiners” for effective patent prosecution. She also encourages inventors to “envision and communicate to the patent attorney all reasonably possible modifications of their current invention to have a broader scope of patent protection, because technology moves fast, and typical shelf life of a patented product is shortening compared to what it was 20 years ago.”

In Global Data Review, Kathleen A. McGee, former Bureau Chief of the New York Attorney General’s Bureau of Internet and Technology and author of New York State’s SHIELD Act on data security, discusses the settlement reached between the FTC and Drizly after the latter’s significant data breach. The settlement not only requires Drizly to destroy any unnecessary personal data and implement a mandated security program, but also requires the company’s CEO to implement an information security program at any future company where he is majority owner, chief executive, or senior officer, if the company collects information from more than 25,000 individuals. McGee calls the settlement “outstanding," but “unsurprising,” especially in light of the recent conviction of Uber's former chief executive for a similar data breach. (subscription required to access article)

Matt Savare discusses Bethenny Frankel’s suit against TikTok in World Intellectual Property Review, calling it “an interesting case to follow” in light of the U.S. Supreme Court’s recent decision to consider scope of liability under Section 230, a section of the Communications Decency Act, that generally provides immunity for website platforms with respect to third-party content. Savare says: “TikTok will almost certainly argue that Section 230 shields it from liability, but that defense may not be availing, as at least one Circuit Court (the Third Circuit) has held that Section 230 does not provide immunity to state right of publicity claims, see Hepp v Facebook,” He adds: “It is interesting that Frankel did not allege some form of indirect liability, such as contributory infringement.” Savare counsels clients on right-of-publicity issues, and regularly negotiates endorsement, sponsorship, and personal appearance deals for athletes, celebrities, and major brands. 

Kathleen A. McGee, former Bureau Chief of the New York Attorney General’s Bureau of Internet and Technology and author of New York State’s SHIELD Act on data security, discusses executive obligations to disclose data breaches in Global Data Review in light of the recent conviction of Uber’s former Chief Security Officer for obstructing justice. McGee notes: “Lying to investigators about matters regardless of if they are [concerning] security or something else is itself a federal offence, … Plainly put, this should be a path no one should have to cross again but it certainly should be a reminder, [of whether] you are in the middle of an investigation with a state or federal regulator, you must take that seriously and you must not conceal.” She adds that requiring data professionals to report to the chief executive, chief legal officer, and board of directors regarding data security incidents “requires the C-suite to effectively take responsibility for data security going forward.”

In The Information, Eric Weiner discusses the recent trend of “up rounds in name only:” financing that guarantees investors high rates of return in worst-case scenarios. Weiner counsels startup and emerging growth companies across all industries and stages as well as the angel, venture, and growth equity funds that invest in them.

In SC Magazine, Kathleen A. McGee comments on the conviction of Uber’s former Chief Information & Security Officer for misleading regulators about a data breach. “Traditionally, CISO are responsible for, among other things, ensuring that accurate information regarding a data compromise is accurately conveyed to both corporate executives and regulators,” McGee says. “In this case, the CISO was also a former DOJ attorney, which frankly increased his basis of knowledge beyond a traditional CISO, whether he was practicing law at the time or not. Sullivan should have been well-aware of his obligation to continue informing federal regulators and the state attorneys general about this additional incident and should have been well-positioned to assess the risk involved in misleading authorities regarding the hacking.”

Above the Law describes the online PLI course “Dealing with Unsolicited Receipt of Confidential or Privileged Information: How Should a “Receiving” Attorney Respond?,” in which Kathleen A. McGee and others discuss how attorneys should handle inadvertent electronic disclosures, metadata, and claw backs. McGee notes that “states usually have guidance for reaching out to opposing counsel. [and] of course, receiving attorneys also have an obligation to their clients;” adding: “If you think it’s too prejudicial to your client to not use in some way you can seek some kind of agreement…If you ask first, you can have more than just an honor system. You can have an agreement.”

Mary J. Hildebrand CIPP/US/E, partner, founder and chair of Lowenstein Sandler’s Privacy & Cybersecurity practice, discusses the potential impact of the European Union’s proposed Cyber Resilience Act in Legaltech News, noting that the law is likely to affect a “… thousands of different companies. The breadth of this is very, very significant.”

The law employs a “security-by-design” approach, holding manufacturers liable for cybersecurity for the expected product lifetime or a period of five years—whichever is shorter. Hildebrand says, “That requirement is significant and could lead to unexpected consequences on the market …It may encourage companies to have a shorter life cycle for their products, so that their obligations to provide fixes, updates, new versions, to [address] vulnerabilities won’t last so long.”

Christian C. Contardo discusses in Cointelegraph whether Iran’s new policy allowing cryptocurrency for cross-border payments might be used to circumvent sanctions. Contardo sees “the scope of Iran’s potential partners as rather limited,” adding: “The ease of crypto transactions can facilitate legitimate trade, particularly in regions where traditional banking may be impractical or unreliable. But, due to the regulatory regimes involved, it is unlikely that large legitimate commercial entities would transact in crypto with Iranian counterparties unless they were seeking to hide their involvement in the transaction.” Contardo expects that U.S. regulators “will increase their scrutiny of transactions linked to countries like Iran.”

In TechCrunch, Lowenstein’s Ed Zimmerman discusses “reproductive rights under the ESG umbrella” in a venture capital and private equity context. The article notes that Zimmerman “believe[s] there are ways for firms to make their stances clear: for example, by adding language in side letters” reflecting that it is important to the LP or the fund to prioritize access to reproductive health care for team members. Investors “have a choice whether to back a business that doesn’t offer birth control as part of employee health plans—and founders have an option of whether to take money from investors that fund other startups that don’t support abortion rights or access to contraceptives,” Zimmerman says. Zimmerman co-founded and chairs Lowenstein’s Tech Group; co-founded First Close Partners; is an Adjunct Professor of Venture Capital at Columbia Business School,; and cofounded and leads VentureCrush.

Kathleen A. McGee talks to Global Data Review about the U.S. Department of Justice's stated ransomware goal of increasing the percentage of reported ransomware incidents by 65%. McGee says, “That’s a metric and mandate they’re setting as aspirational but in order to fulfil that they need to help the private sector and track down the bad guys.”

Global Legal Chronicle reports the formation of 6^th Man Venture’s second crypto fund, valued at $145 million and focused on early stage investments. 6^th Man is represented by Eric Weiner, Edward Nadel, Scott Balterman, and Jeremy Cantor.

In SevenFifty Daily, Matt Savare, Chair of Lowenstein’s Commercial Contracts practice, discusses the growing popularity of non-fungible tokens (NFTs) among alcohol brands and the legal compliance issues involved. He explains “Tokenizing, also sometimes called minting, is the process of a person placing that proof of ownership on the blockchain.”

Mary J. Hildebrand, CIPP/US/E, founder, and chair of Lowenstein’s Privacy & Cybersecurity practice, discusses an alert from top cybersecurity authorities of the "Five Eyes" countries (ASTL, CAN, UK, NZLD, US, UK) warning about an increase in malicious cyber activity targeting managed service providers (MSPs) in CSO. Hildebrand notes that the alert fails to direct MSPs to more thoroughly understand their clients’ security posture, an approach she recommends. “The reason why I recommend this deeper dive into that for MSPs is that vendor error, vendor problems, and vendor breach is a huge issue for companies. Many security incidents and data breaches derive from either employee error or, in this case, an MSP employee error, or problems with the vendor." She adds that international intelligence may have identified MSPs as vulnerable, and “perpetrators… are very skilled at picking out the weak link.”

CSO is a leading information source for chief security officers and senior executives seeking to implement effective security and risk practices while driving business forward.

In Law360, Mary J. Hildebrand CIPP/US/E, founder and chair of Lowenstein’s Privacy & Cybersecurity practice, discusses the Federal Trade Commission’s increase in legal actions against companies failing to address data security issues like Log4j. Hildebrand calls the agency’s recent advisory on the subject “a shot across the bow and a very stern warning that's beginning to set the parameters on what reasonable security might mean for the commission.”

Numerous media outlets report that Matthew R. VanderGoot has joined Lowenstein as partner in the firm’s Tech Group, based in its Washington, D.C office, including Law360 (April 4, April 8), Bloomberg Law,  and Reuters' The Daily Docket.  Zarema A. Jaramillo, Managing Partner of the D.C. office, notes that the firm is expanding its presence in the tech and VC markets inside the Beltway: “[The] tech market in D.C. is robust and will continue to be," she says. VanderGoot adds that “the opportunity to help build out Lowenstein Sandler's D.C. tech practice served as a main attraction for … joining the firm.” 

Dotan Barnea, Co-Chair of Lowenstein’s Israel Practice, is a guest speaker on The Decision-Making Podcast on which he discusses, in Hebrew, a variety of legal issues in the U.S. relevant to Israeli startups, including SAFE funding from a legal perspective, the common mistakes and what founders should know before giving stock options, the differences between LLCs and INCs, and other types of companies in the U.S., and more.

The Mi Casa Resource Center® features the success story of a low income inventor assisted by Lowenstein’s Utah-based Patent Counseling & Prosecution team through the ProBoPat program. Nathan O. Greene and Sam Noel assisted Ph.D. student Bryan Stringham throughout the patent preparation process for his invention MagTrax, a marble run track that uses magnetic track pieces of 26 different varieties to let creators of all ages – from young children to adults – build their own marble runs on walls and refrigerators. The article notes that Lowenstein “has maintained a close partnership with Mi Casa through volunteering with the ProBoPat program since January 2017. These partnerships save huge costs for low-income inventors throughout the Rocky Mountain area and are vital to the program’s mission. Without these efforts, many inventors would be unable to protect their intellectual property.” Stringham adds that he “can rest easy knowing that the product and business for which [I have] sacrificed so much to build will have the legal protection it needs to continue to grow.”

Matt Savare, partner and Chair of the firm’s Commercial Contracts group, talks about important legal issues surrounding NFTs, including the use of someone’s name, image, or likeness in an NFT on the podcast Brave New Coin: Crypto Conversation. Savare discusses his recent article with Brianne L. Polito, “A Haystack in a Hurricane: The Legal Risks of Depicting Real People in Your NFT,” as well as Lowenstein’s extensive experience in the blockchain and cryptocurrency ecosystem, including projects with such clients as Estee Lauder and its Day of Pink NFT for breast cancer awareness, Magic’s noncustodial wallet, and Baxcus, which authenticates the ownership and provenance of high-end wine and spirits. Savare predicts the next trend in NFTs will be the movement from the purely digital to the “tokenization of real world assets.”

Ed Zimmerman spoke to Forbes about the increasing trend toward buying secondary interests in venture funds. “‘Investors now raising funds more frequently, as fast as annually, might be multimillionaires on paper, but have not yet received any profits themselves,’ notes Zimmerman, Chair of the Tech Group at Lowenstein Sandler and an investor in underrepresented fund managers through First Close Partners. ‘There’s no better time to ask your LPs to re-up than once you’ve handed them a check.’” Zimmerman has been involved in thousands of venture fund financings of emerging companies during his thirty years at Lowenstein Sandler, and has invested in more than 150 startups. In addition to his roles at Lowenstein and First Close Partners, Zimmerman has been an Adjunct Professor of Venture Capital at Columbia Business School for more than 15 years.

Storme McKop is featured in an article in UCalgary News about her career and efforts to encourage other Black females to pursue the law. McKop wants to inspire and mentor other Black females to become corporate lawyers, noting: “It is important that Black lawyers be included in the corporate space.” She adds that she enjoys the diversity she encounters in the technology sector, saying that “I love the fact that my clients are not all from the same demographic.”

A graduate of the University of Calgary’s undergraduate and law schools, McKop practiced with a large law firm in Canada before moving to New York to join Lowenstein. While studying at UCalgary’s Faculty of Law, she founded, and was the president of, the UCalgary chapter of the Black Law Students’ Association (BLSA). “It’s important for undergrad students who are Black and who want to go to law school to see other people who look like them doing what they want to do,” McKop says. “You may be the only one in your classroom, but it is important to have a peer group that you can turn to who are having similar experiences.”

In Fortune, Ed Zimmerman, Chair of Lowenstein Sandler’s Tech Group, Co-Founder of First Close Partners and Adjunct Professor of Venture Capital at Columbia Business School, discusses trends regarding private equity and venture capital firms majority owned by underrepresented managers. “‘The underfunding in this market segment [for underrepresented VCs] has been so persistent and dramatic—you can’t really put enough dollars into the market to quench the thirst,’ says Zimmerman, the Lowenstein Sandler tech lawyer who co-founded First Close.” The article, which focuses on JoAnn Price of Fairview Capital—a pioneer of diversity-focused investing—speaks to the emergence of more managers focused on ensuring that venture and private equity are more diverse, equitable and inclusive, noting: “Equity Alliance joins several other investors with a similar focus, including First Close Partners and a new fund from Accolade Partners.” Zimmerman also co-founded and Chairs VentureCrush.

The Global Legal Chronicle reports on Lowenstein’s representation of Aetion, the leading regulatory-grade real-world evidence (RWE) technology provider, in its acquisition of Replica Analytics, a pioneer in using artificial intelligence (AI) for synthetic health data generation. The Lowenstein deal team included Anthony O. Pergola, Mark P. Kesslen, Sarah Gore, and Adam Dickson.

Mary J. Hildebrand CIPP/US/E, founder and Chair of the firm’s Privacy & Cybersecurity practice, talks to Bloomberg Law about why the chances for passage of federal privacy legislation in 2022 are slim. “The politics are so intense in a midterm year, and members of Congress are probably devoting more time toward their reelection campaigns and supporting their own parties,” she says. “2023 may be more fruitful, and it would give us another year for states to adopt more laws.”

The Global Legal Chronicle reports on Lowenstein’s representation of Osmosis, a U.S.-based visual learning platform that has simplified the complex learning journey for millions of current and future healthcare professionals and their patients around the world, in its acquisition by Elsevier, a global leader in research publishing and information analytics. The deal team was led by Anthony O. Pergola.

Matt Savare talks to Fortune about altcoin alternatives to Ethereum and how they may be affected by the blockchain platform’s scheduled upgrades which aim to make it more scalable, secure, and environmentally friendly. “These changes to Ethereum could be a risk to alternative blockchains such as Avalanche and Cardano,” says Savare. However, he adds: “The industry is also growing overall … which will be a good thing for Ethereum in the long run.” (subscription required to access article)

Bloomberg Law includes comments by Valeska Pederson Hintz on Bill Ackman’s new “SPARC” vehicle, or special purpose acquisition rights company. Pederson Hintz says, “SPARCs might only attract a small pool of dealmakers due to financing risks." She adds, "If you’re not a super famous person like Bill Ackman, I don’t see how you convince target companies they should announce a deal with you and spend all the time negotiating it in the hopes you’re going to be able to rally all these rights holders.”

Matt Savare, Chair of the firm’s Commercial Contracts group, comments in Adweek on how social media algorithms can lead to censorship of everyday products such as women’s intimates. Regarding the challenge for Facebook and other companies to create consistent policies, Savare says: “What’s sensitive in San Francisco is very different than what’s sensitive in Omaha, Nebraska. … It’s such a vexing problem, and it’s not going to be solved overnight.”

Compliance Week and Bloomberg Law include comments by Valeska Pederson Hintz about the Securities and Exchange Commission’s decision to approve rule changes proposed by Nasdaq that require Nasdaq-listed companies to disclose information about their board’s diversity. Pederson Hintz tells Compliance Week: “All U.S. public companies, Nasdaq-listed or otherwise, should be paying attention to what investors do with the data disclosed as a result of Nasdaq’s board diversity rules. If they don’t want to fall behind the curve, they should act to address diversity concerns before that data is used against them.” In Bloomberg, she adds that the new rules will give investors “access to an arsenal of information on board diversity that they can use to analyze the issuer, compare it to peers, and apply pressure.”

Ed Zimmerman, Chair and co-founder of The Tech Group, Adjunct Professor of Venture Capital at Columbia Business School, and a Founding Partner of First Close Partners LLC, comments in Reuters on the trend toward funds like Tiger Global leading pre-IPO “cap table cleanup” rounds in which investors infuse capital solely or largely for secondary (to purchase from existing shareholders). Zimmerman says, “A flood of funds at a time when startups stay private for much longer has led to more buy-back deals on the private market.” For instance, Tiger Global led Gupshup’s $240 million raise to buy back shares in advance of a potential 2022 IPO.

In an interview on AM Best TV, Kathleen A. McGee, partner in the firm’s Tech Group and White Collar Criminal Defense practice, addresses what she describes as the “emerging epidemic” of ransomware and how companies can mitigate possible damage to their businesses. McGee says, “There is no stopping a nation state when a nation state wants to get into your infrastructure. … Companies need to address the new normal by putting their money where it counts.” She warns that, despite the experience of Colonial Pipeline in recovering much of its losses, there is “no guarantee that the government will be able to recoup your losses, but it is a best practice to notify law enforcement.” McGee further notes that insurance companies have an important role to play by encouraging best practices: “The probability of being impacted by a ransomware attack is much higher than other acts of god, and insurance companies need to reflect that.”

TVNewsCheck highlights the practical guidance for avoiding and addressing cyberattacks and data breaches that Mary J. Hildebrand CIPP/US/E outlines in her article, “Rising Crime, Rising Response?” To address the heightened risk resulting from companies blending remote and in-office work, Hildebrand recommends engaging “strategic leaders” across all relevant departments, carefully assessing third-party service providers, and educating and continually training employees on how to identify and avoid cybersecurity risks. She further advises companies to keep corporate policies up to date (especially those involving use of IT systems); prepare emergency “plans for incident response, disaster recovery, and other data security issues”; and ensure proper insurance coverage.

Valeska Pederson Hintz, partner in Lowenstein’s Tech Group, Corporate Governance & Compliance, and Capital Markets & Securities practices, speaks to The Information about how an increasing number of tech founders are maintaining control of their companies through supervoting rights. Pederson Hintz says: “It really has just become the norm to do this high-vote stock,” adding that it is an important consideration for firms going public via SPAC, as well as IPO.

Lowenstein's representation of PeriGen Inc. (PeriGen), a leading provider of perinatal health care software solutions, in its sale to Halma plc is noted in the Global Legal Chronicle. The Lowenstein deal team includes Sam E. Khan, Christopher C. Henry, Rachel Ingwer, Lauren M. Troeller, Diana Kim, Kimberly E. Lomot, Megan Monson, Taryn E. Cannataro, Eric Jesse, Bryan Sterba, Matthew P. Hintz, David Toma, James C. Shehan, Edgar R. Hidalgo CIPP/US, Mark S. Heinzelmann, Emily B. Sklar, Megan Williams, Latoya Bethune, and Amanda Sewanan. View Lowenstein's news announcement about this transaction.

Mary J. Hildebrand CIPP/US/E speaks with Cybersecurity Law Report about how New York’s Department of Financial Services (NYDFS) leverages other states’ laws to enforce cybersecurity compliance, as demonstrated in two recent consent orders imposing $4.5 million in penalties on companies for failure to notify NYDFS of phishing incidents that morphed into data breaches. Hildebrand says, “The agency is saying that if you have to notify anybody else, then you have to notify us, too.” Further extending its regulatory reach, NYDFS prohibited one company from using insurance proceeds to pay penalties, a development Hildebrand calls “unusual.”

In Compliance Week, Mary J. Hildebrand CIPP/US/E, partner and Chair of the firm’s Privacy & Cybersecurity group, discusses the Biden administration’s more “regulation-friendly” approach to privacy, as demonstrated in a recent letter by Sen. Edward Markey (D-­Mass.) and Rep. Kathy Castor (D-­Fla.) that asks the Federal Trade Commission to investigate possible violations of the Children’s Online Privacy Protection Act (COPPA) by Google Play. Hildebrand says, “The agency has exercised its considerable authority to enforce COPPA on many other occasions, and I’m personally optimistic this letter will trigger an investigation to ensure that Google and its app developers are playing by the rules.”

In an interview with Authority Magazine, Meredith Beuchaw and Chandra Shih talk about their work in the technology sector, what has influenced them, and why it is important to increase the number of women founders in this field. Beuchaw says, “We’re missing half the great ideas if women are not founding companies and getting funded. We need women because we are missing out on innovation if we do not have women-founded companies.” Shih adds: “Getting more women funded and seeing more women succeed will create a domino effect — it’s the whole idea that representation matters.”

Both Shih and Beuchaw are members of Lowenstein Sandler’s Tech Group, known for representing the underrepresented. Shih, who works with growth stage and early stage startups as well as venture firms and other angel and strategic investors, talks about having been recruited and mentored by her former law school professor and managing partner of the firm’s Palo Alto office, Kathi Rawnsley: “In addition to enjoying the work we do and the people I get to work with, it has been so fantastic to start and grow my career at a place where I could see women had a seat at the table at the highest levels of the firm."

When asked to name her influences, Beuchaw, who leads M&A transactions and has counseled clients both on the buy and sell side through hundreds of deals for over 15 years, cites Michelle Obama’s quote, “When they go low, we go high.” “It is about not letting others’ poor behavior be an excuse for our own,” she says. “This is especially important as we see more women on boards and in decision-making positions. Sadly, most of us have been at the received end of bad behavior along the way, but it is important not to let that be the standard for our behavior now and realize we can bring our moral high ground with us."

Shih references Stacey Abrams’ book, Lead from the Outside, as a helpful guide that "focuses on the challenges that women, people of color and those in the LGBTQ community might have in starting their career, as they are told, ‘to advance you must be a leader,’ but may not know where to begin because the system they’re trying to advance in was not built for them.”

Lowenstein Special Counsel and former New Jersey Attorney General Anne M. Milgram's nomination by President Joseph R. Biden to be the U.S. Administrator of the Drug Enforcement Administration is noted in The Washington Post, Law360, Reuters, The Week, NJ.com, The National Law Journal, NJBIZ, JURIST, Homeland Security Today, The American Law Institute, the Regulatory Affairs Professional Society, ROI-NJ, and the New Jersey Law Journal. The White House’s official announcement can be read here. (subscription required to access certain content) View Lowenstein's news announcement about this nomination.

Ed Zimmerman, Chair and co-founder of The Tech Group, Adjunct Professor of Venture Capital at Columbia Business School, and a Founding Partner of First Close Partners LLC, speaks about The Diversity Dividend (#ElDividendodelaDiversidad) as part of a panel, “The Return on Investing in Diverse Fund Managers,” presented by Promoting Venture Capital in Peru (PECAP). The panel, including Susana Garcia-Robles of Capria/LAVCA, Anita Fiori of IDB Lab, Jose Fernandez of StepStone Group, and moderator Luis Narro of PECAP, addresses why it is important and lucrative to invest in underrepresented venture capital fund managers. “Diversity is not only an imperative from a human rights, civil rights, and justice perspective, … it is a financial imperative,” Zimmerman says. “There are unbelievable missed economic opportunities as a result of the myopia that comes from having only people who look the same, went to the same schools, and live in the same communities.” He encourages LPs to speak up by asking GPs to diversify their reference list in order to expose the flaws in their networks. Zimmerman notes that a lack of diversity in the VC world results in “massive costs and causes exclusion, discomfort, and inequity in the workplace.”

Mary J. Hildebrand CIPP/US/E, founder and Chair of Lowenstein’s Privacy & Cybersecurity group, speaks with Law360 about the need for federal regulation governing companies’ collection and maintenance of COVID-related health information, including who has and has not received a Covid-19 vaccine. Hildebrand says, “The current situation with COVID-related data underscores the compelling need for federal action…California residents have been accorded certain rights to personal information under state law which may be helpful, but protection of this sensitive data should not depend on where you live."

Mary J. Hildebrand CIPP/US/E, Chair of Lowenstein Sandler's Privacy & Cybersecurity group, is a guest speaker on Artificial Intelligence Edition, the inaugural episode of the podcast McLane Middleton Minutes, on which she discusses facial recognition software, how companies should structure its use and the data they collect from it, and why a federal law on this issue would be helpful. Citing the increase in class actions and conflicting regulations, she suggests that companies use the Illinois Biometric Information Privacy Act and the FTC’s Ever Album settlement agreement as guideposts on this issue.  

The Wall Street Journal reported on First Close Partners (tweet below from reporter Yuliya Chernova):

"Ed Zimmerman, chair of the tech practice at the law firm Lowenstein Sandler, says he texted Theresia Gouw, founding partner at Acrew Capital, in November about the idea of teaming up to invest in underrepresented fund managers.

The newly formed firm, First Close Partners, has already backed about two dozen venture funds and expects to invest in more than 60 by the end of the year, Mr. Zimmerman said. These include Avid Ventures, Base Ventures, Cleo Capital, Marcy Venture Partners and Slauson & Co., among many others. The majority of fund managers that First Close has committed to are Black and a majority are women, Mr. Zimmerman said. Some contacted First Close cold, with no prior introductions.

Founding partners in First Close also include Regina Benjamin, a former U.S. Surgeon General, as well as Josh Kopelman, co-founder of First Round Capital, and Betsy Zimmerman, partner at GrapeArbor Ventures and Mr. Zimmerman’s wife.

“We are trying to have an impact that exceeds our dollars, and also to make money with the underrepresented managers that we are backing,” Mr. Zimmerman said. “We’ve seen instances of our money being dramatically multiplied by other [limited partners] coming in, either where we introduced them or served as a reference,” he added.

He declined to state how much capital First Close Partners has in total, but said that his family is investing $1 million into it.

Well-connected people in the venture industry can act on diversifying who gets to play in the market. While there’s an aspect of social good in the effort, Mr. Zimmerman says that it’s also about financial benefit: “When a fund has been successful, it’s hard to get into fund three or fund four. Being an early backer enables you to follow on.”

Lowenstein's representation of Avid Ventures in the launch of its $68 million-plus debut venture capital fund founded by Addie Lerner, decade-long investor at General Catalyst, General Atlantic, and Goldman Sachs, is noted in the Global Legal Chronicle. The Lowenstein deal team included Ed Zimmerman, Marie T. DeFalco, Max Karpel, Robert J. Menendez, Joseph F. Hendricks, and Bettina C. Elstroth. View Lowenstein's news announcement about this transaction.

In The American Lawyer, Chair and Managing Partner Gary M. Wingens discusses how the firm performed “shockingly well given what was going on in the world” in 2020. Wingens credits the firm’s investment funds, tech, life sciences, bankruptcy, and capital markets practices, in addition to engagements in venture capital and private equity. “People need lawyers as things change,” he says. Wingens is optimistic about 2021: “I do feel that we are at the beginning of a whole new economic cycle,” he says. “I think there’s going to be an enormous amount of investment activity.”

Ed Zimmerman, Chair and co-founder of The Tech Group and Adjunct Professor of Venture Capital at Columbia Business School, teamed up with Marie T. DeFalco (Vice Chair of Lowenstein’s Investment Management Group) to represent Avid Ventures in its $68 million-plus debut. Zimmerman tells Business Wire that managing partner Addie Lerner is “a brilliant, hard-charging, and charismatic force within the venture community. She will win deals by force of intellect, personality, and the reputation for excellence and integrity that she has already developed here in the States, in the UK, and in Israel. Having been opposite Addie in my role as counsel to startups, I’ve been impressed to see, more than once, founders rapidly transition from meeting Addie to making room for her in oversubscribed venture rounds.”

In Pitchbook, Zimmerman says: "LPs back the person in a solo GP fund. … I'm excited to see how people react … [to Avid], and whether others say this strategy is different and I'd like to copy it, or at least pivot into it a little bit more.”

Zimmerman tells TechCrunch that Lerner has a reputation for being “extraordinarily thoughtful about deals” and that one entrepreneur called her “one of the smartest people she has met in a decade-plus in venture.” He adds: “I’ve seen it myself in deals and then I’ve seen founders turn down very well branded funds to work with Addie. … Addie will find and win and be invited into great deals because she makes an indelible impression on the people who’ve worked with her and the data is remarkably consistent.”

On GGV Capital’s Unscripted, Ed Zimmerman, Chair and co-founder of The Tech Group and Adjunct Professor of Venture Capital at Columbia Business School, talks to GGV’s Jeff Richards about the importance of QSBS for founders, diversity on your startup’s board, the leverage shift in term sheet negotiations, and the impact of SPACs v. IPOs for VC-backed growth companies.

Mary J. Hildebrand CIPP/US/E talks to Law360 about increasing state and federal regulation of the collection and use of biometric data such as facial scans and fingerprints. She says, “The FTC's proposed settlement [with Ever, a defunct photo storage app that allegedly deceived consumers about its use of facial recognition technology] and the proposed New York law lead me to the conclusion that we will continue to see a proliferation of biometric privacy laws. It's an issue that cuts across geographies and demographics.” (subscription required to access article)

The article also appears in Biometricupdate.com.

Ed Zimmerman, Chair and co-founder of The Tech Group and Adjunct Professor of Venture Capital at Columbia Business School, is interviewed by CEO/Founder Mazy Dar on the podcast Openfin MVP. Entitled “Our Whole Selves at Work with Ed Zimmerman,” Zimmerman discusses his career as a lawyer, investor, and co-founder of VentureCrush, as well as his social/political advocacy efforts. Topics include Zimmerman and Dar having had lunch with Vice President-Elect Kamala Harris years ago (before the duo hosted her for a fundraiser for her successful 2016 Senate bid), as well as discussing common legal mistakes founders make and the more than 100 angel investments Zimmerman has made. The conversation also focuses on efforts to improve #Diversity in tech and venture, with reference to company culture and initiatives in which Zimmerman has personally been involved, including his Wall Street Journal Accelerators columns in 2013 (asserting that #VentureCapital was too white, too male, and too homogenous) and 2014 (Zimmerman published one of the earliest pledges against #GenderBias in Tech, a pledge he still follows).

Mary J. Hildebrand CIPP/US/E tells Reuters that Nike’s workout apps are a source of valuable information about customers; she notes that the data they provide give the company a “significant advantage” over rivals. She states, “[Nike] likely has several scientists using the data to see if shoppers will tolerate higher prices.” The Reuters article was reprinted in Yahoo! Finance, Nasdaq, City A.M., América Retail, and the New York Post.

Mary J. Hildebrand CIPP/US/E speaks to Compliance Week about the FTC’s request for information from nine social media companies and streaming services, including Amazon.com, Facebook, and YouTube, concerning their collection, use, and sale of users’ personal information and the impact of those practices on children and teens. “I think this inquiry is long overdue,” she says. “And I doubt it will be the last one. I’m hoping the information they collect might inform a national data privacy law.” Hildebrand warns companies working with the nine organizations singled out by the FTC that they, too, may be affected: “If you’re a company that deals directly with the named organizations, or companies that may share data with these companies, you should take note.”

Ed Zimmerman comments to Nasdaq in an article on the booming stock market and VC-backed growth companies going public via IPO and SPAC. Ed, who chairs The Tech Group at Lowenstein Sandler and, for the last 16 years, has been an Adjunct Professor of Venture Capital at Columbia Business School notes: “One of the things we’re seeing is a lot of performance – companies are actually performing. … They weren’t necessarily performing in the 90’s and during the dot com crisis.”

On the popularity of SPACs as a means of going public, Zimmerman tells Nasdaq, “When you have people who have made lots of money who are doing [SPACs], that enhances the credibility. They’re not in a cordoned off section of the market.” Zimmerman also remarks that more mature companies are turning to SPACs rather than IPOs: “These are companies that could IPO and are choosing a different path – that’s a meaningful difference as compared to SPACs we saw five to six years ago.” 

Kathleen A. McGee speaks to SC Magazine about how a Biden administration might handle cybersecurity issues, noting that vice presidential candidate Kamala Harris has experience negotiating with tech companies. “During a time when mega breaches impacted consumers at a very personal level, her office took the lead on several of those investigations,” she says. “Along with several other states,” McGee continues, “California entered into what were groundbreaking agreements with companies that paved the way for a greater level of expectation [of privacy from customers.]” McGee worked with Harris’ California State Attorney General’s Office in her former position as chief of the Bureau of Internet & Technology for the New York State Attorney General’s Office. 

Because Harris represents Silicon Valley in her role as a U.S. Senator in California, McGee notes that this gives her “unique credibility for both sides of the debate” over privacy rights to consumer data, and that credibility may eventually prove helpful in securing passage of a federal privacy bill.

Mary J. Hildebrand CIPP/US/E speaks to SC Magazine about H&M’s recent $41.5 million penalty for collecting personal data on its employees in Germany. She observes that while companies may understand that their employees have “the same rights under applicable data protection laws [such as GDPR] as revenue-generating customers, [they often lack] … appropriate follow-through and implementation of these policies to ensure that employee privacy rights are respected.”  Hildebrand adds, “H&M has generated an impressive list of to-dos in an effort to compensate for egregious and illegal data collection and processing activities.”

Mary J. Hildebrand CIPP/US/E says that U.S. companies should be prepared to respond to inquiries regarding the Foreign Intelligence Surveillance Act (FISA) and its implications for their business, including EU data transfer activities. In Corporate Counsel and Legaltech News articles discussing a Lowenstein/ACC New Jersey Cyber Day presentation featuring Hildebrand and Mark Faber (Vice President, Corporate Counsel, Cyber and Privacy Law, Prudential Financial), Hildebrand notes that since the European Union Court of Justice invalidated the EU-U.S. Privacy Shield, various EU organizations have required completion of “detailed questionnaires… about FISA...” in order to initiate or continue commercial relationships.

Rossie E. Turman III explains to The American Lawyer his reasons for moving from Skadden to Lowenstein Sandler as partner and Chair of Lowenstein Sandler’s International Finance group, with seats in the firm’s Debt Financing group and The Tech Group: “If you’re trying to grow, align yourself with someone else that is trying to grow. … [I]f you’re trying to succeed, align yourself with someone else that is trying to succeed.” The article notes that Turman “will work closely with the firm’s Tech Group in representing companies based in emerging markets that have interests in the U.S.” He will lead Lowenstein’s efforts with respect to companies and funds located in and doing business with Africa. He has also actively engaged in civic endeavors and supported several charities on the African continent for nearly 30 years. 

In Westlaw Today’s story about his joining the firm, Turman says his “move to Lowenstein would facilitate building out the ‘three-legged stool’ of … [my] … practice, incorporating cross-border transactions, finance and technology.” 

Private Equity Wire, Law.com International/Middle East and Africa, Reuters, Bloomberg Law, and ROI-NJ also cover Turman’s transition to Lowenstein. (subscription required to view certain content) View Lowenstein's news announcement about Turman joining the firm.

In Bankrate, Ed Zimmerman and Meredith Beuchaw of Lowenstein Sandler’s Tech Group discuss 2020’s booming tech IPO market and SPAC trend. Contrasting the current IPO market with the over-hyped bubble, Adjunct Professor of Venture Capital at Columbia Business School and Lowenstein Sandler’s Tech Group Chair Zimmerman says: “The companies that we’re seeing going public in the tech world today are performing,” adding that SPACs may be more risky. “SPACs – what happens if they clock out before they can roll out a company? They may close deals, but they may catch falling knives to complete their mandate.”

Both lawyers anticipate an impact from the upcoming election. Zimmerman advises growth equity investors, VCs and management teams that are poised to IPO “to think carefully about the timeframe for their investments and how they might deal with fallout from November.” Beuchaw observes: “Companies are prepping for potential disruptions, even if they don’t come to pass….If capital dries up, that could lead companies to take an alternative path to get into the public markets…– IPOs, SPACs.” She says, “They’re dual-tracking an entry into public markets, perhaps through a merger or acquisition.”

Ed Zimmerman, Chair and co-founder of The Tech Group, and Adjunct Professor of Venture Capital at Columbia Business School, is quoted in The Real Deal, discussing the lawsuit regarding the co-founding of Compass, a real estate tech startup that has raised more than $1.5 billion from investors, including Softbank. The lawsuit pertains to whether plaintiff Avi Dorfman (who, according to the court, was a co-founder of Compass), is entitled to shares of stock in Compass (reportedly recently “valued at $6.4 billion”) or solely cash damages. The case, which has been compared to the “Facebook/ Winkelvoss lawsuit,” is presently pending in New York. Zimmerman’s view: “The brokerage likely wants to avoid a fiduciary relationship with Dorfman. With shares, Dorfman would be empowered to request financial information, and it’s possible his vote would also be needed to approve a company sale. If the court awards him cash, their relationship is contractual and short-lived. They rip the Band-Aid off.”

Matt Savare speaks to Adweek about how media buyers can protect themselves if they still want to buy advertising on TikTok despite the app’s issues with the U.S. government. He suggests they consider including provisions in their contracts so parties can opt out of doing business with TikTok if it becomes illegal, or if they are concerned about the app’s new owner. Savare also notes that the ultimate buyer is going to go out of its way to be advertiser friendly.

Matt Savare speaks to International In-House Counsel Journal on the evolution of media buying and technology, stating that “Revising the industry-accepted set of terms is a massive undertaking that will require the entire ecosystem to come together, express their diverse views, and compromise on issues for the greater good of increasing contracting efficiency, reducing legal costs, and simplifying a complex process. … [However,] broad consensus is achievable.” 

Lowenstein's representation of Traub Capital, an investment firm specializing in building value in consumer companies using its unique combination of strategic, operational, and financial expertise, in the company’s purchase of MANA Products, a premier beauty contract manufacturer based in Long Island City, New York, is noted in the Global Legal Chronicle. The Lowenstein deal team included Michael A. Brosse, Lauren M. Troeller, Lowell A. Citron, Doreen M. Edelman, Darren Goodman, Ted Hunter, Marc S. Kurzweil, Gavin J. Rooney, Jeffrey M. Shapiro, Michael Walutes, James C. Shehan, Norman W. Spindel, Daniel A. Suckerman, David Toma, Stuart S. Yusem, Abbey E. Baker, Eric Jesse, Stacey  C. Tyler, Naomi D. Barrowclough, Matthew P. Hintz, Manali Joglekar, Kimberly E. Lomot, Kathleen A. McGee, Megan Monson, Zachary L. Berliner, Christian C. Contardo, Mark S. Heinzelmann, Amanda C. Lutick, Michael T. Melchiorre, Joshua A. Rabinovits, Stephen Tanico, Jenna-Marie Tracy, Joseph Mignone, and Keith Janowitz. View Lowenstein's news announcement about this transaction.

Crunchbase News, Precision Oncology News, Pulse 2.0, and the Global Legal Chronicle report on the $118 million Series B funding for Lowenstein client MURAL, the leading digital workspace for visual thinking and remote collaboration. The Lowenstein deal team included Ed Zimmerman, Alex D. Leibowitz, Serena Ward, Brian A. Silikovitz, Darren Goodman, Mark P. Kesslen, and Carly S. Penner. View Lowenstein's news announcement about this transaction.

Law.com reports that mergers and acquisitions attorney Meredith Beuchaw has joined Lowenstein Sandler’s Tech Group as partner, noting that “[w]hile laterals for certain practice groups, such as life sciences and bankruptcy and restructuring, have been quite active during the pandemic, M&A attorney pickups have been less common.” Beuchaw says, “Joining the Tech Group provides the opportunity to participate in a community of lawyers who are renowned for their creative and strategic approaches to uniting visionaries and funders.” The article goes on to note that the firm “has seen significant growth in revenue and head count over the past decade ... [and has] increased revenue by a whopping 43% from its 2011 numbers.”

Beuchaw's arrival to Lowenstein is also noted in Bloomberg Law, General Counsel News, and Westlaw Today. View Lowenstein's news announcement about Beuchaw joining the firm.

Lowenstein represented both Serial Productions and “This American Life” in a pair of simultaneous deals with The New York Times Company (which acquired Serial and struck a strategic alliance with “This American Life”) as noted in The New York Times, The Wall Street Journal, MarketWatch, citybizlist, Variety, finanzen.net, and Global Legal Chronicle among others. Lowenstein’s deal team included Ed Zimmerman, Anthony W. Raymundo, and Matt Savare. View Lowenstein's news announcement about these transactions.

Lowenstein's representation of PeakSpan Capital in an investment transaction in which PeakSpan, Morgan Stanley Expansion Capital, and others invested more than $42 million in Ecwid is noted in the Global Legal Chronicle. The Lowenstein team was led by Anthony O. Pergola and Juan B. Soto and included Ifat Lipman, Joon Hwan Kim, and Serena Ward, with support from Darren Goodman, Eric Jesse, Leah Satlin, Sophia Mokotoff, and the firm’s Global Trade & National Security team (led by Doreen M. Edelman), among others. View Lowenstein's news announcement about this transaction.

Aircall's $65 million Series C funding round, the result of an international team from Osborne Clark (including Lowenstein Sandler) advising DTCP's Venture and Growth Fund II, is noted in TechCrunch, Inside Intercom, Business VoIP, Venture Capital Journal, SiliconANGLE, Silicon Republic, and VentureBeat. (The Lowenstein team was led by Anthony O. Pergola and Alex D. Leibowitz, along with Matthew W. Stichinsky and Jenna-Marie Tracy, and the firm’s Global Trade & National Security team (led by Doreen M. Edelman), among others.) View Lowenstein's news announcement about this transaction.

Lowenstein's representation of Aspiration Partners, Inc. in its $135 million Series C financing round is noted in the Global Legal Chronicle. The Lowenstein team was led by Anthony O. Pergola and Chandra K. Shih and included Juan B. Soto and Christopher T. Pham. View Lowenstein's news announcement about this transaction.

Fortune reports that Lowenstein client Aspiration Partners, a fast-growing financial firm with a conscience, has secured $135 million Series C financing, bringing total funding raised to date to more than $200 million. The Lowenstein team was led by Anthony O. Pergola and Chandra K. Shih and included Juan B. Soto and Christopher T. Pham.

Kathleen A. McGee is quoted in Law360 on the federal government’s evolving guidance about qualifications for SBA PPP loans and the next steps for companies now that the deadline to return those loans has passed. "Initially, there weren't a lot of questions," she says. “Although from the start we were advising clients that … you did have to show need and you had to establish that need was immediate need." When the SBA issued clarifications in late April regarding ownership and affiliation that especially affected technology and VC-backed companies, “that's when people really started to, I would say, panic," she says. McGee notes that even companies with loans under $2 million may still face Department of Justice scrutiny and possible whistleblower suits under the False Claims Act. (subscription required to access article)

Ed Zimmerman, partner and Chair of The Tech Group, is quoted in Business Insider discussing the SBA’s issuance of new rules and guidance that may retroactively disqualify many venture-backed startups from receiving small business loans as part of the federal government’s coronavirus relief effort. Zimmerman notes that some companies are already paying back funds they received in response to the new rules after being encouraged to apply for the program by Treasury Secretary Steve Mnuchin. He states that the SBA and Treasury Department have “really muddied the water” with the latest guidelines. (subscription required to access article)

Ed Zimmerman and Kathleen A. McGee of Lowenstein’s Tech Group are quoted in The New York Times and Reuters on the risks for venture-backed startups seeking government stimulus aid. McGee warns companies with large cash reserves that applying for SBA loans now could “probably … be a flag raised for regulators who are combing through these applications at another time.”  Zimmerman also advises caution: “One thing that I have said to one or two clients is you might not like me very much today or in three months, but I think you’ll like me four years from now when you’re reading about investigations and private lawsuits in the paper and you don’t have this in your background.”

In Built In, Ed Zimmerman, Kathleen A. McGee, and Kimberly E. Lomot discuss the confusion regarding startups' eligibility under PPP for SBA loans, including how venture capital-backed growth companies should consider certifying “need” under the CARES Act. “The reporting in the press was, ‘Startups are totally ineligible or almost totally ineligible,’” says Zimmerman. “But that’s not what the law says. That’s analysis under Section 103, and the proper way to do the analysis is under 301.” He goes on to clarify under what conditions “negative control” by minority owners may constitute affiliation so as to bar PPP loan eligibility, and how to avoid this through irrevocable waivers or amended charters.

Both Zimmerman and McGee emphasize the importance of documentation. McGee, former Bureau Chief at the New York State Attorney General’s Office, explains the potential risk of future prosecution for companies applying for PPP without having properly assessed the “necessity” certification: “If it is demonstrable on the budget in the Excel spreadsheet you’re keeping that things are going to get much tighter because of COVID-19, then I think you’re justified. … But you have to have that good faith justification. If you have a year of bank, it’s probably going to be a flag raised for regulators.”

Lomot, who has years of experience counseling both borrowers and lenders on SBA loans, also urges caution in taking the certifications seriously: “eagerness to claim available funds…could get startups in trouble if they’re not applying in good faith.”

In Inc., Matthew J. Moisan praises the SBA’s clarification of PPP eligibility for VC-backed startups as helping create “a fast, inexpensive process for the companies.” The SBA now defines an affiliate as an investor who can block actions by a startup's board of directors; if the investor relinquishes that right, the business is no longer considered an affiliate and will have a better chance of meeting the headcount requirement and eventual success in its loan application.

Dotan Barnea, Co-chair of the firm’s Israel Practice Group, is quoted in Globes discussing the eligibility of Israeli startups and growth companies for assistance from the United States’ recent $2 trillion-dollar federal program for small and medium-sized businesses. He says, "Israeli startups with significant activity in the United States influenced by the COVID-19 crisis should definitely look at the PPP loans,” although he cautions that applicants must show that the management of the company was done by American citizens or green card holders.

Matthew J. Moisan comments in Inc. magazine on VC-backed startup eligibility for the Paycheck Protection Program. If investors have the right to veto a merger or dissolution under the certificate of incorporation, the portfolio companies might be considered affiliates and thus ineligible for assistance. "We are interpreting that this type of provision is not indicative of control or of affiliation, but the rules are imprecise," he says.

Pensions & Investments features comments by Ed Zimmerman, partner and Chair of The Tech Group, on how the hunt for potential unicorns by venture capital funds has resulted in a “lack of discipline” and an increase in vanity valuations. He says, “These valuations are not supported by the recent transactions of comparable companies or by any other metric. … [M]oney is being spent by some managers based on the need to deploy capital.” (subscription required to access article)

AltAssets and GlobeNewswire report on Lowenstein’s representation of One Inc. in the company’s recapitalization led by Great Hill Partners. The Lowenstein deal team included Kathi A. Rawnsley, Darren Goodman, Brian A. Silikovitz, Megan Monson, Chandra K. Shih, Sarah Gore, Christopher T. Pham, Kristin V. Taylor, and Chad M. P. Weeks.

Doreen M. Edelman, Chair of the firm’s Global Trade & National Security group, addresses the risks for U.S. dealmakers posed by the new rules implemented by the Committee on Foreign Investment (CFIUS) in an article in The Deal. The February 13^th implementation of the Foreign Investment Risk Review Modernization Act, or FIRRMA, extends the authority of the Committee in ways that will impact “[t]ech startups, private equity firms, hedge funds, C-suite executives and other stakeholders,” says Edelman, warning that “transactions could be jeopardized if parties don’t fully understand the new regulatory regime adopted by the Treasury Department, which oversees the nine-member government panel.” She adds that stakeholders must carefully classify their products and technologies; in “some cases, tech companies may not realize they have Chinese investment that could attract the committee’s attention or may wrongly assume that a small stake isn’t a concern.”

Ed Zimmerman’s comments are featured in The New York Times, Reuters, Deal Street Asia, and Business News World in an article on market conditions for mergers, acquisitions, and financing for late-stage startups and tech growth companies in the wake of WeWork’s failed IPO. Zimmerman, Chair of Lowenstein’s Tech Group, observes that overfunded growth companies could clog the market for venture-backed M&A: "How do you buy a company with $400 million or $800 million of liquidation preference for under a billion dollars?” (subscription required to access The New York Times article)

Matt Savare’s predictions about artificial intelligence in 2020 are included in a roundup of opinions by legal technology thought leaders in Law.com. He anticipates that “transparency and traceability will capture the cultural and political zeitgeist. We’re already seeing this trend with laws such as the GDPR and CCPA and various proposed laws regarding bias in artificial intelligence.” He further predicts that the “conversation regarding data will move from one focused primarily on security to one focused on ownership, fairness, and trust.” (subscription required to access article)

Lowenstein's representation of ACV Auctions in its $150 million late-stage venture capital financing is noted in the Global Legal Chronicle. The Lowenstein team included Anthony O. Pergola, Dotan Barnea, Joon Hwan Kim, and Cecily Larison. View Lowenstein's news announcement about this transaction.

TCG Capital Management’s $83 million investment in Lowenstein client Food52 by was reported by The Wall Street Journal, Vox, Yahoo! Finance, Cision PR Newswire, The Big Lead, TMCNet.com, The PE Hub Network, Bloomberg Law – Big Law Business, Markets Insider, Morningstar, benzinga, StreetInsider.com, Financial Content, Law360, IT News Online, and the Global Legal Chronicle. (The Lowenstein Sandler deal team was led by deal lawyers Ed Zimmerman and Alex D. Leibowitz, with tax support from Brian A. Silikovitz and James E. Gregory (executive compensation). The Lowenstein attorneys on the team were Robert W. Lynn, Pooja Patel, Elias Kwon, Bianka V. Barraza, and Matthew J. Moisan, with subject matter expertise from Sophia S. Mokotoff (tax), Megan Monson (executive compensation), Leah Satlin (commercial contracts), Taryn E. Cannataro (executive compensation), and Eric Jesse (insurance). View Lowenstein's news announcement about this transaction.

Bloomberg News, Yahoo! Finance, BNN Bloomberg, Financial Advisor Magazine, fin24, MSN Money, The Baltimore Sun, and Daily Herald include comments by Ed Zimmerman, Chair of The Tech Group and professor of venture capital at Columbia University’s Graduate School of Business, in the article “A Prenup Is the Latest Must-Have for Tech Startup Founders in Love.” “We have companies where the founder is the brand, and trust and credibility are core to the business,” says Zimmerman. ‘“If you are investing in a company because you think the founder is amazing,” news of that individual’s distracting divorce or custody battle can be alarming. Zimmerman further explains other personal difficulties which can impact a startup: “It would be great if we lived in a world where people who had marital problems didn’t manifest those problems by hitting on or dating people who worked at their company…. Those kinds of things tend to be more problematic than who gets the shares.”

Matt Savare is quoted in a multipart series by the Hedge Fund Law Report on artificial intelligence in the hedge fund industry. In Part 1, which focuses on ways fund managers and financial services companies can use artificial intelligence to streamline operations, Savare notes that most, if not all, hedge funds and financial service companies are using AI or third-party software embedded with AI to inform their trading decisions, assist with customer service, extend credit, detect fraud, among many other things. In Part 2, he responds to President Trump’s Executive Order on AI:  “AI is critical not only to the economy and society, but also to national security. … Therefore, it is not surprising that the federal government is taking it so seriously.” Savare further addresses the need for conducting due diligence with respect to data security when an “AI company offers its solution as a software-as-a-service, [as] it may have access to a manager’s systems, nonpublic financial information.” Given the risk of bias in AI, Savare states that “software makers who are coding their systems, or the employers who are utilizing the AI and feeding more data into it, must be mindful that the AI’s decisions be fair and equitable.” In Part 3, Savare addresses how AI can be used to conduct routine legal work for the benefit of clients and attorney alike. He uses the example of a large quantitative hedge fund with hundreds of different data‑licensing contracts in differing forms: instead of using “an army of contract attorneys…it would be better to engage a  AI service provider that could use optical character recognition, or OCR, to convert non-digital data into machine-encoded text … The AI platform could then conduct a large portion of the diligence for them, including summarizing contract provisions, finding material information and identifying anomalies.” He also suggests AI can be used when a hedge fund or private equity is researching whether to buy or invest in a company. Generally, AI allows lawyers to focus more on “high-value strategic services,” and allows an organization to “service more clients; be more organized and consistent; use fewer people; and develop deeper connections among employees.” However, “human involvement is still needed, “says Savare.  “People will always be more important – the machines are there to help them and their businesses grow.” (subscription required to access article)

Mary J. Hildebrand is featured in an article on TVNewsCheck spotlighting her presentation at the conference Media Outlook 2020, which expanded upon an article written by Hildebrand and Carly S. Penner for the Media Financial Management Association’s magazine, The Financial Manager. Hildebrand explains how the United States differs from Europe and certain other countries in that it does not have a set of federal laws addressing privacy and cybersecurity generally and that federal laws here are industry-specific. Although the Federal Trade Commission is the de facto regulator of many online activities, including privacy and security standards, companies must now consider 50 different state data breach laws, plus Guam, Puerto Rico, and the Virgin Islands. California and Nevada have also adopted comprehensive data protection laws, and more states are considering similar legislation. Hildebrand recommends that businesses focus on five issues in the coming year:

1. New state laws, like California’s CCPA and Nevada’s new data protection law;
2. Creating a formal written incident response plan in case of a data breach, including appropriate training and cyber insurance;
3. Updating privacy policies to be clear, concise, and transparent about personal information collected, the purpose of collection, and how it is used and shared; the use of cookies and third-party analytics providers; and include statements required by state data protection laws such as California and Nevada;
4. Understanding sales and marketing departments’ collection, use, and sharing/sale of personal information; and
5. Developing an inventory of personal information collected, used, and shared across the organization.

David Leit is interviewed by Financial Planning in an article about FinancialApps’ suit against former partner Envestnet|Yodlee for fraud and misappropriation of trade secrets. He comments on the lack of specific breach of contract claims and reliance on alleged statements made outside of the agreement’s contracts: “The problem with these kinds of cases is that you have to prove that the defendant was lying or defrauding at the time they started working with the plaintiff. … If the defendant can show that either it never made such promises, or that whatever promises it made at the time were genuine, that is a strong defense.” Leit observes that FinApps must prove that the code it provided Evestnet constituted a trade secret: “The formula for Coke may be a trade secret, but if I come up with my own formulation for a drink that tastes just like Coke, that isn’t trade secret misappropriation.” He also remarks that hiring President Donald J. Trump’s personal attorney, Marc Kasowitz, indicates that FinApps is pursuing a “bet the company” strategy.

Jeffrey Cohen is quoted in a Law360 article regarding the Chapter 11 case of United Sporting Companies. As a lawyer for the official committee of unsecured creditors in the case, Cohen remarks on the recent deal struck between the committee and the debtor, which will allow another chance to find a buyer for the debtor’s assets.

Jeffrey Cohen is quoted in The New York Times in an article on the fate of startup companies that do not succeed or fail quickly. Cohen observes that venture capital investors may let a company struggle for years: “They’re willing to let it ride a little longer to see whether it explodes.” (subscription required to access article)

Kathleen A. McGee comments for CNET on privacy issues associated with Sony’s robot dog Aibo, a device equipped with facial recognition cameras and always-listening microphones, warning that “there are legitimate privacy concerns about the products in our homes that gather data about us.” McGee says that information can be “bundled and sold in ways that the consumer is not necessarily aware of or may not approve of if she knew about them…What if I'm on a health care regimen with my doctor and I cheat on my diet? Am I now going to be profiled for insurance companies in a less than attractive way?" She cautions that the privacy policy may not offer much guidance on how to erase the device’s memory: “The privacy policy is designed to mitigate regulatory concerns…It is not an instrument for the consumer's use. Full stop."

Valeska Pederson Hintz is quoted in Bloomberg Law discussing the $20.8 million valuation of Slack, a work-messaging tech unicorn, prior to its direct listing. She explains that, when a company pursues a direct listing instead of an initial public offering, “you need enough brand recognition and people need to understand what your product is.” She also suggests that Slack should look to the Spotify precedent and disclose stock prices from recent private sales in its registration statement ahead of going public: “You have to really help people with price discovery.” (subscription required to access article)

Mary J. Hildebrand, Chair of the Privacy & Cybersecurity group, is quoted in Compliance Week in an article on how state laws are filling in the federal privacy data void and why New York State's privacy legislation is important. She says it puts “more companies at issue since it includes far more companies under its jurisdiction. State law also allows private causes of action for violating the New York Privacy Act, although New York might make the individual litigant prove damages.” Hildebrand adds that “[c]ompanies seeking to comply [with the New York Privacy Act] will be confronted by complexity and entirely new (and ill-defined) concepts such as ‘data fiduciary’ and ‘privacy risk’ … [and that] in any merger or acquisition that involves the transfer of personal data associated with a New York state resident, affirmative consent to the transfer must be obtained from each New York resident before the transfer is permitted to occur.”

Anne M. Milgram is profiled in MarketWatch where she describes her past experience as one of New Jersey’s only female Attorneys General and her current work applying data to fight crime. Part of a series called “Ceiling Smashers,” in which successful women discuss how they broke down professional barriers, the article looks at Anne’s experience as New Jersey’s second-youngest AG and only the third woman to hold the job. She recalls that “I was used to being the only woman in the room, which is a terrible thing to get used to. I don’t think any of us should accept that in today’s world.”

Anne describes her current mission “to make communities safe and create paths and opportunities for less crime and less incarceration … (by) rethinking how we approach public safety.” In addition to her work with the firm’s White Collar Criminal Defense team and The Tech Group, she is also the founding director of New York University School of Law’s Criminal Justice Innovation Lab, a project that employs data and technology to develop tools promoting a safer, fairer, and more efficient criminal justice system.

Lowenstein Sandler’s VentureCrushParis is featured in Forbes. The article discusses the vast differences in raising venture capital in Europe versus the United States, noting a valuation gap and quoting Dataiku’s CEO and co-founder Florian Douetteau. VentureCrush brings together founders and venture capitalists that allow startups to build the right network and gain visibility within the industry. Learn more about our upcoming VentureCrush events here.

Lowenstein’s 2019 promotion of seven lawyers to partner and six to counsel (including three women in each category) is noted in Bloomberg Law – Big Law Business. These promotions are also highlighted in LawFuel, The Deal, and the Commerce and Industry Association of New Jersey’s (CIANJ) Business Beat newsletter, with Lesley P. Adamo, Dmitry Andreev, Marc S. Kurzweil, James B. O’Grady, Eileen Overbaugh, Peter Slocum, and Julie Levinson Werner highlighted as newly elected partners and Brandon Fierro, Joseph G. Jones, Robert Lynn, Brianne Perlman, Nedda N. Salehi, and Leah Satlin listed as promoted to counsel. Gary M. Wingens is quoted regarding the critical role these lawyers will play in the firm’s continued success. Law360 notes our partner elevations in an article highlighting firms' Q1 promotions. (subscription required to access certain content) View Lowenstein’s news announcement about these promotions.

Lowenstein Sandler was featured prominently in Diversity in Action magazine in a piece focused on opportunities in tech law for diverse people with backgrounds in STEM. Madhumita Datta, Ph.D., discusses her transition from engineer to patent agent to intellectual property lawyer, finding satisfaction in working with inventors by “giving voice to their invention, protecting their legal rights, and bringing their inventions closer to market.” Kathleen A. McGee considers lawyers working the area of tech law “to be some of the luckiest because we get to shape the law in the way that very few practices do.”

The article also highlights the work of Ed Zimmerman, Chair of Lowenstein’s Tech Group, on behalf of LGBTQ rights and against gender bias in the tech field. Ed comments on how recent law school graduates are attracted to tech law because “they grew up in the space and are early adopters.” A. Faith English, the firm’s Manager, Diversity & Inclusion, adds that her early experiences in private practice, public policy, and social justice have enhanced her ability to develop successful diversity initiatives, remarking on the importance of “having someone who looks like you at the power table.”

Matt Savare is quoted in ComputerWorld and The Economic Times regarding IBM’s new blockchain initiative with Stellar and the increased usage of blockchain in fin tech and cryptocurrencies in consumer transactions.  

Ethan L. Silver is quoted in ComputerWorld and The Economic Times regarding blockchain and the possibility of cryptocurrencies eventually becoming a platform for consumer transactions. Silver asserts that companies must be aware of existing regulations for financial networks and how they may be applied to evolving technologies.

Lowenstein's having received top rankings in several categories in the Patexia 2019 Patent Prosecution Intelligence Report is highlighted in the Commerce and Industry Association of New Jersey’s (CIANJ) Business Beat newsletter.

Ethan L. Silver is quoted in Financial Planning discussing the Securities Exchange Commission’s increased enforcement of regulations for robo-advisory firms. Silver affirms the necessity of strong, ongoing compliance programs as a key to minimizing the risk of penalization. He stresses the importance of firms to enhance disclosures and limit claims on social media, to ensure that they are “delivering on what was promised through marketing channels.”

Matt Savare and Bryan Sterba address the major elements of open-source software (OSS) and how it is being utilized by fund managers, in an interview with the Hedge Fund Law Report. In the first of a three-part series, Savare explains blockchain’s relation to open source, and how it can facilitate the settlement of international transactions in a fraction of the standard time. Sterba provides insight into the workings of copyleft licenses, including how some organizations navigate stringent licensing requirements. In part two, Savare and Sterba discuss the benefits of OSS, including its proper use and how it can equal cost savings if implemented correctly, as well as the security risks and license restrictions. In part three, Savare and Sterba evaluate actions fund managers can take to mitigate OSS risks, including policies, procedures and controls to adopt; ways to deal with third-party vendors; and due diligence.

Lowenstein’s representation of Dataiku its $101 million Series C funding round is profiled in the Global Legal Chronicle. The write-up notes the Lowenstein team: Ed Zimmerman, Evan M. Bienstock, Dotan Barnea, and Laura Cicirelli. View Lowenstein’s news announcement about this representation.

Kathleen A. McGee is quoted in CNET discussing the rising popularity of smart homes and internet-of-things (IoT) devices among apartment landlords. The article analyzes the benefits and risks that face landlords and tenants when it comes to the use of these innovative products. McGee notes that “landlords are, in theory, in your apartment every day collecting information; tenants suddenly have to choose between no home and a place where they perceive themselves to be spied on.”

Ethan L. Silver was featured in both American Banker and Interactive Investor, commenting on the US Securities and Exchange Commission’s (SEC) reticence to approve new cryptocurrency, despite encouraging more discussion. Silver states that: “the practical realities are that there has been a lot of meetings and discussions that have yielded little progress." He agrees with SEC Commissioner Hester Peirce that the Howey Test – used by US regulators to determine what should be considered a security – is “overly broad.” Silver asserts that until the SEC provides clarity on how digital assets should be custodied under its existing rules, a bitcoin exchange-traded fund (ETF) will never be approved.

Valeska Pederson Hintz is quoted in Forbes in which she discusses Slack, a work-messaging tech unicorn, and the company’s plan to forego a traditional initial public offering (IPO) in favor of a direct listing this year. The article describes this as an unconventional move that could encourage other tech unicorn companies to consider a direct listing in lieu of an IPO, though this isn’t likely to become a mainstream trend. Pederson Hintz suggests that large tech unicorns are uniquely positioned to take advantage of a direct listing for their market debut because they are often well-capitalized and have brand recognition (Wealth Daily also quotes Pederson Hintz on this point). She states that direct listings are faster and cheaper than traditional IPOs. (subscription required to access article)

Matt Savare is quoted in Bloomberg BNA in an article discussing how online advertisers are utilizing blockchain to fight fraud. Savare, who is noted as a member of the Interactive Advertising Bureau’s blockchain working group, recommends the tactic and comments that blockchain “dramatically reduces the incidence of fraud.”

Billboard magazine mentions the role Lowenstein Sandler’s Tech Group Chair, Ed Zimmerman, played in producing a song by four-time Grammy Award winner and blues legend, Keb’ Mo’. In discussing the song “Put a Woman in Charge,” Billboard quotes Keb’ Mo’ as he explains how he and his co-writers were working on the song:

“[T]hen we realized that we needed a guest. So I called my friend, Ed Zimmerman, in New York and was telling him about it, we needed a guest. He said, “I know somebody that might want to do it.’ And I’m like, ‘Who?’ He said, ‘How about Rosanne Cash?’ And I went, ‘Holy Moly, that’s perfect.’ We called her up and she said yes and we sent her the files. She sung the song. We put her on the record and got some backgrounds going, and we had a record.”

Rosanne Cash, a best-selling author, is also a four-time Grammy Award winner. The song was released to great reviews. Zimmerman, who is also an adjunct professor at Columbia Business School, published a case study about Keb’ Mo’ in September 2018, and the artist came and lectured at the Venture Capital class that Zimmerman teaches there. Mo’ ultimately performed the song for the class, so it premiered before 80 or so MBA students a few days prior to the song’s release.

In an article noting that Massachusetts-based companies accounted for nearly half of all 2017 biotech industry investments, BioPharma-Reporter reprints a quote from Steven M. Skolnick, who stated in the publication’s August 20, 2018, article that a strong market and economy have been drivers behind investments and M&A activity, leading to a large number of successful biotech IPOs.

Steven M. Skolnick is extensively quoted in BioPharma-Reporter regarding potentially record-breaking numbers in biotech initial public offerings in 2018. Skolnick notes the strong market and economy are drivers behind investments and M&A activity, leading to a large number of successful biotech IPOs. While the first half of 2018 started off strong, Skolnick cautions that the political climate and normal market indicators may cause volatility in the latter half of the year.

CNBC highlights Intapp’s acquisition by DealCloud. Lowenstein was counsel to DealCloud for this transaction. View Lowenstein’s news announcement about this deal.

The Global Legal Chronicle notes Lowenstein Sandler's representation of Safe Banking Systems (SBS) in its acquisition by Accuity. The write-up lists the Lowenstein team: Raymond P. Thek, Alex D. Leibowitz, Pooja Patel, Mitchell McDonald, and Zarema A. Jaramillo. View Lowenstein’s news announcement about this transaction.

The Global Legal Chronicle notes Lowenstein Sandler’s representation of Integral Ad Science in an article discussing Vista Equity Partners’ majority-stake acquisition of the company. The article notes that the Lowenstein deal team was led by Raymond P. Thek and included Peter H. Ehrenberg, Ed Zimmerman, Colin J. Kirby, Shimite Obialo, Sarah Gore, Elias Kwon, Alex Galev, Christina Lee, and Kristen Nicol, as well as support from specialists in Tax: Brian A. Silikovitz and Sophia Mokotoff; Employee Benefits & Executive Compensation: James E. Gregory, Darren Goodman, Megan Monson, and Eric Margulies; Intellectual Property Litigation: Mark P. Kesslen and Lisa A. Harvey; Antitrust & Trade Regulation: Zarema A. Jaramillo; and Privacy & Cybersecurity: Mary J. Hildebrand. View Lowenstein’s news announcement about this transaction.

Bloomberg Law – Big Law Business cites Mark P. Kesslen and his team members for tying in third place at the Diversity in Law Hackathon at Harvard Law School on June 22, 2018. Kesslen’s team proposed In.C—short for “inclusive culture”—which aims to help employers track and measure employee feedback on diversity and inclusion factors such as a sense of belonging and shared trust. Used broadly enough, organizations can cite their In.C score to demonstrate to clients, customers, competitors, and the public that they are serious about diversity and inclusion.

The Global Legal Chronicle profiles Lowenstein's representation of Dreams, a cutting-edge mobile application, in the negotiation of various content licensing agreements with BBC, Discovery, Bloomberg, and other major content licensors. The article also notes our firm's representation of Dreams in its Series A financing. The write-up lists the Lowenstein team: Eric Weiner, Matthew N. Holbreich, and Christopher C. Henry on the Series A financing and Matt Savare on the content licensing transactions. View Lowenstein’s news announcement about this transaction.

MarTech Series, Markets Insider, 4-traders.com, The PE Hub Network and citybizlist highlight Lowenstein Sandler as legal counsel to global software company Integral Ad Science in its majority-stake acquisition by leading private equity firm Vista Equity Partners.

Cosmetics Technology and Business Wire note Lowenstein Sandler as legal counsel to New Mountain Capital and portfolio company Topix Pharmaceuticals, Inc., in their acquisition of DERMA E. (Lowenstein deal team: Marita A. Makinen, David L. Goret, Matt Savare, Michael Walutes, Darren Goodman, Eric Jesse, Manali Joglekar, Marc S. Kurzweil, Kimberly E. Lomot, Justin Gindi, Tim Janas, Megan Monson, Leah Satlin, and Jacob D. Unger.)

The Buffalo Law Journal notes Lowenstein Sandler as counsel to a company discussing its General Data Protection Regulation (GDPR) compliance efforts. The article quotes Mary J. Hildebrand, who notes many companies’ confusion as to whether and why GDPR applies to them. Hildebrand explains that GDPR has expanded the definition of personal data, that it applies depending on where data is processed (not just on where it “sits”), and that GDPR compliance obligations will involve careful judgment calls.

Radio program 1A interviews Kathleen A. McGee and other experts regarding the Supreme Court's May 2018 decision permitting states to decide whether or not to legalize sports gambling. 1A is distributed by NPR and produced by WAMU 88.5. Listen to the program.

Law360 quotes Ed Zimmerman on the pent-up demand for IPOs by an increasing number of venture-backed technology companies. (subscription required to access article)