The start of a new year is often marked with resolutions to do things differently, whether in our personal or professional lives. However, despite the best of intentions, competing priorities and unexpected events can easily sidetrack these goals. This year, the threat of a recession looms large and is already beginning to impact business across all sectors, including legal services. For in-house legal departments, such predictions will likely create pressure to do more internally with fewer resources, which is why lawyers must double down on setting goals for themselves and following through in order to meet the challenges of the year ahead.

Bolstering the protections afforded under the California Consumer Privacy Act (as amended by the California Privacy Rights Act, the CCPA), California has enacted the California Age-Appropriate Design Code Act (AADC), which expands the scope of online privacy protections for children under 18. The AADC will take effect on July 1, 2024 and apply to CCPA-regulated businesses. As such, those businesses are encouraged to begin conducting impact assessments now in light of the possibility that material design changes may be necessitated by the AADC.

Following recent state legislative trends, as well as encouragement from the Biden Administration, the Federal Trade Commission (FTC) announced on January 5^th a proposed rule (Proposed Rule) to ban non-compete agreements between most employers and employees in an effort to bolster both competition and innovation in the workplace. If adopted, the Proposed Rule would apply nationwide.

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Most U.S. companies by now have modified their business practices to comply with the General Data Protection Regulation (GDPR). However, when it comes to the use of analytics technologies such as Google Analytics, the compliance requirements are less clear given the added applicability of the EU “Cookies Directive” (formally, the EU Directive 2002/58/EC) which regulates the use of cookies alongside GDPR-imposed consent requirements. Although implementation of the Cookies Directive varies from country to country in the EU, a decision issued by one national authority can be suggestive of future action. Last year, France’s data protection authority, the French Commission Nationale de l’Informatique et des Libertés (CNIL), issued an important interpretation of the Cookies Directive as it relates to the use of Google Analytics on a website accessible by EU/EEA residents.

Since a startup’s incentive equity pool will interact with and have an impact on the pricing and dilutive effect of its equity fundraising rounds, it is important that founders understand how an incentive equity pool may impact their fundraising efforts. Like founders themselves, investors in early stage companies understand the necessity of using incentive equity to attract and align interests of employees and other service providers with the interests of founders and investors in the long term growth of the company’s value. In fact, if a pool has not previously been established at the time of a startup’s initial priced equity fundraising round, the investors in that round will likely require its creation as a condition of the investment.

How many times have lawyers heard that:

In most startup companies, with cash in limited supply and a relatively high risk that the venture will fail, it can be difficult to recruit top talent as employees and advisors. Incentive equity grants provide a solution to this problem, serving as both a substitute for the higher cash compensation that an employee or service provider might receive working for a larger or later-stage venture and/or a means of rewarding the risk associated with early stage ventures.