Commercial Litigation Update

To plead securities fraud, a plaintiff must allege that the defendant made a false statement or omitted a material fact, did so with scienter, and that the plaintiff relied on that misrepresentation and suffered injury. Many cases rise or fall on the scienter element—did defendant have the requisite “intent to deceive, manipulate, or defraud”?  That’s where a familiar refrain often surfaces:  “My lawyer said it was fine.”  The so-called advice-of-counsel defense can be a powerful shield.  When a defendant has laid out all the facts for their lawyer and acted with the lawyer’s blessing, it becomes harder for a plaintiff to prove the intent required under §10(b) of the Securities Exchange Act and related provisions.

Yet this defense carries a significant cost.  As Oklahoma Firefighters Pension & Retirement System v. Musk et al., 22-cv-03026 (S.D.N.Y. 2022), illustrates, asserting an advice-of-counsel defense is likely to trigger an implied waiver of the attorney-client privilege—effectively exposing confidential communications with counsel to discovery.  The rationale is simple: a defendant who claims a good-faith belief in the lawfulness of their conduct necessarily places at issue the communications that shaped that belief.

The U.S. Supreme Court has several highly contentious matters under consideration, or soon to be argued, including whether various presidential executive orders can survive separation-of-powers analysis.

Yesterday, however, the Court began the flow of this term’s decisions with two per curiam opinions (that is, unsigned rulings of a unanimous Court) that reached easily predictable conclusions.

That is not to say that these decisions are unimportant. Indeed, for those of us who, if only occasionally, defend criminal cases, the two decisions provide useful procedural advice. Given the tenor of recent arguments, though, this term’s early harmony is unlikely to last. So, let’s revel in the peace of the day.

New episode of our video podcast, Speaking of Litigation: This Veterans Day, Speaking of Litigation brings you a special episode featuring Epstein Becker Green attorneys Stuart Gerson, Jack Fernandez, Ron Green, and Ken Kelly, who share their unique journeys from military service to impactful legal careers.

Discover how their military experiences shaped their leadership, resilience, and approach to the practice of law. This episode also celebrates the service of the broader Epstein Becker Green community, including employees and their families.

In Summer 2025, the U.S. Court of Appeals for the Sixth Circuit issued a strongly worded decision in In Re: FirstEnergy Corporation (No. 24-3654)—confirming the core concept that internal investigations conducted by counsel and in anticipation of litigation are privileged and protected from disclosure. When securities plaintiffs in the case sweepingly sought all documents “related to the internal investigation,” the district court incorrectly ordered their production. After much legal wrangling, the Sixth Circuit rebuked the district court on August 7, 2025, and reaffirmed in a per curiam opinion filed October 3, 2025. 

The U.S. Court of Appeals for the Eleventh Circuit held in United States ex rel. Sedona Partners LLC v. Able Moving and Storage Inc., No. 22-13340 (11th Cir. Jul. 25, 2025), that while a district court has the discretion to dismiss a relator’s complaint before or once discovery has begun, it may not disregard the allegations of qui tam relators at the motion to dismiss stage solely because those allegations reflect information obtained in discovery.

In September 2025, the U.S. Attorneys’ Office for the Eastern District of Pennsylvania (EDPA) announced that it would be implementing a White-Collar Justice Program to strengthen its white- collar enforcement framework. Among other things, the program will “empower Assistant United States Attorneys to aggressively pursue complex investigations and significant new matters on their own initiative.”

This announcement demonstrates another step in federal districts ramping up their white-collar enforcement efforts while encouraging robust procedures for compliance and self-disclosure. This is a trend several years in the making: in September 2022, then-Deputy Attorney General Lisa Monaco directed U.S. attorneys and others within the DOJ to review their policies on corporate voluntary self-disclosure, and to draft and share a formal written policy to incentivize such self-disclosure, if one was lacking.

The federal Telephone Consumer Protection Act (the “TCPA”), 47 U.S.C. § 227, was enacted in 1991 to protect consumers from unsolicited telemarketing calls, faxes, and now text messages.  For businesses that engage in telemarketing, the TCPA poses significant legal risk for noncompliance.  The TCPA's strict regulations and severe financial penalties mean that even inadvertent violations can lead to substantial fines and costly class-action lawsuits.

Adding more compliance risk to telemarketers, Texas enacted its own TCPA (known as the Texas “mini-TCPA”) in 2009 to further protect the privacy of Texas residents by imposing more requirements on businesses engaged in telemarketing activities in Texas and by implementing more robust enforcement mechanisms.

New episode of our video podcast, Speaking of Litigation: Courtroom dramas make for great entertainment, but how much of what we see on screen reflects the reality of litigation?

In this episode of Speaking of Litigation, we analyze iconic scenes from Succession, The Good Wife, Bridge of Spies, and more to uncover the truths—and myths—about the legal process.

Join Epstein Becker Green attorneys Sierra Hennessy, Aime Dempsey, and Adam Paine as they separate Hollywood fiction from legal reality, offering practical insights for anyone navigating the litigation process.

On September 11, 2025, General Dynamics Corporation (“General Dynamics”), along with other naval manufacturers and defense contractors, petitioned the Supreme Court of the United States to consider whether an unwritten “no-poach” agreement was sufficient to invoke the doctrine of fraudulent concealment and toll the Sherman Anti-Trust Act’s (the “Sherman Act”) four-year statute of limitations.

In May, the Fourth Circuit, in permitting an over-decade-old claim to proceed, held that an unwritten secret agreement was sufficient to toll the Sherman Act’s limitations period, noting that “neither logic nor our precedent supports distinguishing between defendants who destroy evidence . . . and defendants who carefully avoid creating evidence in the first place.” However, that decision conflicts with those of the Fifth, Sixth, and Ninth Circuits—all of which previously found that mere secrecy was not adequate to invoke a fraudulent concealment tolling theory.

Generative Artificial Intelligence (“AI”) tools like ChatGPT, Scribe, Jasper, and others have catapulted exponentially in popularity in recent years, for widespread personal and professional uses supplementing, if not largely displacing, traditional search engines. Applications for AI interactions in the workplace, algorithmically simulating human reasoning and inference, are expanding as quickly as users can draft new prompts requesting designs, how-to guides, correspondence, and countless other outputs. AI tools have quickly transitioned from an amusing new technology to essential tools for professionals and businesses, driving innovation and efficiency. These tools are used by businesses for an ever-expanding list of purposes, including brainstorming ideas based on patterns and data analysis; creating and memorializing documents, procedures, manuals, and tutorials; generating marketing and other client-facing materials; drafting communications; summarizing documents; explaining concepts and processes; and even generating code.

As these tools become more integrated into workplace processes, courts and litigants are beginning to confront the question of whether and to what extent AI searches and “chats” are discoverable in litigation. As the Federal Rules of Civil Procedure permit broad discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case, litigants may potentially be entitled to compel production of information and communications generated or processed by AI platforms related to the facts in dispute. Fed. R. Civ. P. 26(b)(1); In re OpenAI, Inc., Copyright Infringement Litig., No. 23-CV-08292, 2025 WL 1652110, at *2 (S.D.N.Y. May 30, 2025). Just as local news headlines are replete with instances of internet searches as evidence in criminal cases[1], real-time AI “interactions” may likely be subject to the same disclosure requirements in civil litigation.