For Inside Track this week, in-house desk editor Kibby Araya highlights the top stories.

Coronavirus concerns are now legal department concerns.

Corporate Counsel is the official news hub for in-house counsel facing the coronavirus crisis at their companies. The novel coronavirus COVID-19 outbreak is gripping the world, especially the business world, putting in-house counsel at the center of attacking any legal disruptions that could plague companies.

A recent study from the American Chamber of Commerce in China asked member companies such as Boeing, General Motors, IBM and Microsoft how they will be impacted by the outbreak. The study found 10% of companies reported they are losing about $71,500 a day and one-fifth said their 2020 revenues will decline more than 50% if the outbreak extends through the summer.

As a global brand, Corporate Counsel began coverage early on the coronavirus impact on companies, particularly those that do business in China, where cases of COVID-19 were first reported.

Employers in China using force majeure claims became one of the major issues we first tackled as a concern for U.S. legal departments. At the time, China reportedly had certified some 100 businesses to invoke force majeure exemptions from contractual duties, citing the coronavirus outbreak as a qualifying disaster with many employees quarantined in their homes.

"I feel like I'm dealing with this [coronavirus impact] 24/7," Dan Harris, of Harris Bricken in Seattle, told Corporate Counsel. "It's all-consuming."

That was last month. Now, we have a story further examining the impact the coronavirus outbreak may have on in-house counsel. Find out more about the story below.

How is your legal department responding to COVID-19 coronavirus concerns? Please let us know at my email [email protected].

"A coronavirus outbreak or pandemic will present a plethora of business and legal issues which often are intertwined…. In-house counsel can be helpful in separating business issues from legal issues and identifying approaches to each one in a manner that mitigates both business and legal risk."

- Elisabeth Belmont, corporate counsel at MaineHealth in Portland, Maine

What's Happening

 

 

Coronavirus and the Workplace

The Centers for Disease Control and Prevention has not classified the worldwide COVID-19 outbreak as a pandemic here in the U.S., but the spread of cases is making employers uneasy, which in turn are making in-house counsel uneasy.

Howard Mavity, a partner at Fisher & Phillips in Atlanta, said employers need to establish policies on how to handle absences caused by illnesses and public measures such as the shutting down schools or public transportation. These factors alone could cause many employees to call out, even if they're not sick.

"If 50% of your workforce is forced to take a week or two weeks of their time, you will have a huge unfunded expense," Mavity said. "I am telling clients you need to sit and calculate this out because it could put you in the red. Can you insure any of it? Or fund any of it? That's not something most employers have thought out."

 

 

Is Your Company's Data Breach Plan Up to Date?

If the answer is no, your company may be in the same boat as many others, according to a new study by Experian Data Breach Resolution and Ponemon Institute.

The lack of an update to a data breach plan could be the reason why 36% of respondents reported their organization had a ransomware attack last year. The average ransom was $6,128 and 68% of respondents said it was paid.

"Preparedness plans can't be a binder on a shelf that are not active and fluid plans," said Michael Bruemmer, vice president of data breach resolution and consumer protection at Experian. "They should be reviewed and updated at least on a yearly basis."

 

 

What CLOs Need to Do When CEOs Leave

Disney. Nokia. MGM Resorts. IBM. LinkedIn. These are a few of the companies that recently announced their CEOs had plans to step down immediately or later in the year. Corporate Counsel reported on this phenomenon back in October when WeWork, eBay and Juul lost their CEOs within one week.

"It's very disruptive to the legal department," Lee Udelsman, managing partner at Major, Lindsey & Africa in New Jersey, said in our story. "In a circumstance like an unplanned exit, you're going to have to have all hands on deck."

In 2019, Corporate Counsel covered the trend of more top lawyers being tapped for the CEO role. This past week, Brinks Home Security's CEO announced plans to step down while the GC became interim CEO.

What I'm Reading

While people opt for self-quarantine during the novel coronavirus outbreak, they may rely on gig economy workers for their needs from delivering food to running errands. Bloomberg Opinion looks at the larger impact the outbreak can have on consumers and those who work for companies such as Postmates, Uber and TaskRabbit.

So far 2020 seems to be the year of CEOs jumping ship. But CEO Jack Dorsey of social media network Twitter and on-the-go payment company Square may be forced to jump ship. According to CNN Business, an activist hedge fund that obtained a large stake in Twitter criticized Dorsey for holding the CEO seat at two companies. Elon Musk, another double CEO of Tesla and SpaceX, shared his support for Dorsey on, of course, Twitter.

Former Vice President Joe Biden experienced a historic resurgence in his presidential campaign on Super Tuesday. The Seattle Times reports Biden hasn't given Washington state much attention before its March 10 primary election but revisits his November appearance at the local home of Amazon.com general counsel David Zapolsky.

Don't Miss

Thursday, March 5 – Corporate Counsel Business Journal will be hosting a Legal Operations Executive Forum at the Tarrytown House Estate in Tarrytown, New York. Speakers will include Andrea Colby, former IP counsel at Johnson & Johnson; Darren Guy, AIG global head of legal operations; and Brian Liss, senior vice president and deputy general counsel at Leidos.

Tuesday, March 10 to Thursday, March 12 – Georgetown Law will be hosting Corporate Counsel Institute at the Georgetown University Law Center in Washington, D.C. Speakers will include Caroline Tsai, chief legal officer at Western Union, Farinaz Tehrani, chief legal officer of Advantia Health, and William Min, general counsel at RELX, Risk & Business Analytics.

Thursday, March 19 – The WAWTA 2020 In-House Counsel Program: Creating A Winning Trial Team will be held at the Washington, D.C. office of Faegre Drinker Biddle & Reath from 5:30 p.m. to 8 p.m. Speakers will include Zandria Conyers, deputy general counsel at NCAA; Chad Boudreaux, litigation and chief compliance officer at Huntington Ingalls Industries Inc.; and John Trocki, deputy general counsel at the Washington Metropolitan Area Transit Authority.

On the Move

 

 

Elizabeth Cutri is the new general counsel at Stats Perform, a Chicago-based sports data company. Cutri tells Corporate Counsel why she left her Big Law job at Kirkland & Ellis and decided to go in-house at a startup.

Former Microsoft lawyer Jessica Nguyen describes her journey to becoming the first top lawyer at startups now that she has joined Seattle-based Lexion as chief legal officer.

Pier 1 Imports quietly elevated Ray McKown to general counsel. McKown has worked at the home furnishings and decor firm as an in-house lawyer for 15 years. He succeeds Robert Bostrom, who died suddenly in January.