The Case: What Happened to Bradley Heppner?

In United States v. Heppner, Bradley Heppner faced serious federal criminal charges, including securities fraud, wire fraud, conspiracy, and falsifying corporate records. United States v. Heppner, 820 F. Supp. 3d 292, 295 (S.D.N.Y. 2026). Upon learning he was the target of a federal investigation, Heppner decided to use Claude, an AI platform developed by Anthropic, to help build his defense. Id. at 295.

Acting entirely on his own initiative, Heppner used Claude to analyze the facts of his case, draft potential defense strategies, and prepare arguments to counter the prosecution’s case. Id.

When the FBI later executed a search warrant at Heppner’s home, agents seized approximately thirty-one electronic devices and documents containing his communications with Claude, and federal prosecutors sought to review these materials. Id. Heppner argued that the conversations were off-limits under both the attorney-client privilege and work-product doctrine. Id. The Southern District of New York, however, rejected both arguments.

Why AI Conversations Lack Attorney-Client Privilege

First, AI is not an attorney. Id. at 296. Attorney-client privilege depends on a trusting human relationship, such as a professional relationship with a licensed attorney who owes fiduciary duties and is subject to discipline. Id. In Heppner, the court emphasized that no such relationship exists or could exist between an AI user and an AI platform. Id. While AI can be a valuable tool for research or organization, it lacks the professional obligations and legal authority necessary to establish a privileged relationship.

Second, the communications contained in the AI documents were not confidential. Id. at 296. Generally, users retain no substantial privacy interest in conversations they voluntarily disclose to an AI platform. Id. Anthropic’s privacy policy, for example, states that user inputs and outputs may be disclosed to third parties, including law enforcement or in connection with litigation. Id. Because users are on notice that their communications may be disclosed, the court in Heppner found that the defendant could not reasonably expect his conversations with Claude to remain private. Id. at 297

Finally, attorney-client privilege applies only to communications made for the purpose of obtaining legal advice from a licensed attorney. Id. In Heppner, the defendant argued that he used Claude for the “express purpose of talking to counsel.” Id. However, he did not communicate with Claude at the direction of counsel, and Claude itself explicitly disclaimed providing legal advice. Id. The court therefore concluded that the communications between the defendant and Claude were not privileged at the time they were made. Id. The court also rejected the argument that non-privileged communications become privileged simply because they are later shared with counsel. Id. Because the AI documents would not have been privileged in the defendant’s hands, they did not acquire protection merely because they were transferred to his attorney. Id.

Why the Court Denied Work-Product Protection

The defendant also argued that the AI documents were protected under the work product doctrine, which shields materials prepared by or at the behest of counsel in anticipation of litigation. Id. The court rejected this argument as well.

Although the defendant created the documents while facing criminal charges, he did so entirely on his own initiative. Id. In fact, defense counsel even conceded that the AI documents “were prepared by the defendant on his own volition.” Id. at 298. While counsel acknowledged that the AI documents may have influenced strategy going forward, they did not reflect counsel’s strategy at the time the defendant created them. Id. Accordingly, since the AI documents were neither prepared at the direction of counsel nor reflective of counsel’s strategy, they failed to qualify for work-product protection. Id. at 299.

Considerations for Attorneys & Law Firms

United States v. Heppner serves as a reminder that attorneys should proactively counsel clients about the risks of using AI. Because AI is so accessible, clients may unknowingly expose sensitive, damaging details to AI platforms before ever speaking to counsel. Attorneys should address AI usage during initial consultations and explain the risks of sharing information with these tools. Setting clear expectations early will safeguard client confidentiality and prevent avoidable privilege disputes in court.

Important Tips for Clients

If you are currently facing or anticipating litigation, protect yourself by keeping these guidelines in mind:

• Keep sensitive details private: Never enter confidential facts about your legal case into an AI platform.
• Do not upload lawyer communications: Never upload emails, letters, or advice from your attorney into an AI platform.
• Leave strategy to your attorney: Do not use AI to map out legal strategies.
• Remember AI’s limits: Pursuant to its policy, AI is not: (1) an attorney; (2) able to give legal advice; or (3) a platform where data entered is confidential.

Bottom Line

United States v. Heppner is one of the first rulings to define the boundaries of client AI use and legal privilege. While AI can be a valuable tool for learning general legal concepts or organizing information, it is not a substitute for legal counsel. When a matter has legal significance, it belongs in only one place: with your attorney.

For more information or to seek counsel from our Litigation group, please reach out to request a consultation or call us at 216-696-1422. McCarthy Lebit would like to thank law clerk Marlie K. Landskroner for her effort in assisting with the preparation of this legal blog post for The More Report.

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This information is provided for general informational purposes only and should not be construed as legal advice. Readers should consult with qualified legal counsel regarding their specific circumstances before taking any action based on the information presented.

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Social media can impact litigation in numerous ways, including giving rise to causes of action, generating damaging evidence, escalating costs, and escalating conflict between parties.

Potential Claims

First, social media can create potential causes of action and claims which might very well end up in litigation. For example, claims for defamation or invasion of privacy might arise when social media content is used to defame or disparage an individual or a company.  Defamation is a false publication that injures a person’s reputation.  A cause of action for defamation consists of five elements: (1) a false and defamatory statement; (2) about the plaintiff; (3) published without privilege to a third party; (4) with fault of at least negligence on the defendant’s part and (5) that was either defamatory per se or caused harm to the plaintiff.  Id. Written defamation, such as a statement on social media, is also known as libel.

Unfair and deceptive trade practices might arise when a person, in the course of their business, vocation or occupation, “[d]isparages the goods, services, or business of another by false representations of fact.”

Trademark Infringement and Unfair Competition

Claims for trademark infringement and unfair competition may also arise from misuse of social media. Unfair competition ordinarily consists of representations by one person, for the purpose of deceiving the public, that his or her goods are those of another. It may also extend to “unfair commercial practices such as malicious litigation, circulation of false rumors, or publication of statements, all designed to harm the business of another.”

Moreover, the use of social media may cause a person to be dragged into a court outside of the county or even the state where the person is sitting when typing a social media post, so caution is recommended.

Potential Evidence

The use of social media may also give rise to evidence that may hurt a person’s standing before a judge, a jury or any other finder of fact such as an arbitrator. In addition to potentially creating a cause of action, social media posts, when properly authenticated, can be used as evidence of motivation, opportunity, statements against interest, admissions, and other evidence of bad conduct. Social media posts can also be used to demonstrate a person’s background, qualifications, employment history, representations to the marketplace and other personal and professional qualifications. In this regard, what a person may say in court, in deposition, or in a pleading or motion, may be substantially different from what that person may have said in a social media post. These contradictions can be used to undermine credibility.

Potential Escalation of Costs

Because imprudent use of social media can create causes of action and be used as evidence in litigation, the costs and expenses of litigation can increase. It should go without saying that defaming another person on social media can result in expensive litigation. But engaging in imprudent use of social media can increase discovery costs and can also lead to embarrassment on a witness stand.

Potential Escalation of Animosity

Finally, it can be observed that imprudent use of social media, or taking your dispute public, can have a counterproductive result through the hardening of positions and the escalation of animosity. While a lawsuit may not have received much if any attention when filed, once a party takes the dispute to social media, the publicity that social media may generate may backfire. This is because both parties may dig in their heels and seek final and conclusive resolution in Court.

Conclusion

Social media is everywhere and it has affected our lives for good and bad. It may also impact litigation by creating causes of action, by providing evidence that can be used in litigation, by escalating costs and expenses, and by escalating animosity between the parties. One angry key stroke to social media can have very real consequences.

For more information, or to seek counsel from our Litigation practice group, please reach out to request a consultation or call us at 216-696-1422.

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This information is provided for general informational purposes only and should not be construed as legal advice. Readers should consult with qualified legal counsel regarding their specific circumstances before taking any action based on the information presented.

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What is a Trade Secret?

Ohio has enacted the Uniform Trade Secrets Act (“UTSA”). The UTSA defines a “trade secret” as: Information, including the whole or any portion or phase of any scientific or technical information, design, process, procedure, formula, pattern, compilation, program, device, method, technique, or improvement, or any business information or plans, financial information, or listing of names, addresses, or telephone numbers, that satisfies both of the following:

1. It derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use.  
2. It is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

Ohio’s Trade Secret Test

Ohio Courts utilize a six-factor test for determining whether information constitutes a trade secret:

1. The extent to which the information is known outside the business.
2. The extent to which it is known to those inside the business.
3. The precautions taken by the holder of the trade secret to guard the secrecy of the information.
4. The savings affected and the value to the holder in having the information against competitors.
5. The amount of effort or money expended by the owner in developing the information
6. The amount of time and expense it would take for others to acquire and duplicate the information.

How to Ensure Your Trade Secrets Are Protected Internally

Companies should make sure their confidential and proprietary information is restricted to individuals inside and outside the organization. Such information should only be disclosed to those individuals on a need-to-know basis. Such individuals should also be bound by a non-disclosure and confidentiality agreement. Company policies, employee handbooks, and manuals are not typically sufficient to replace a well-crafted NDA. Confidential information should be kept under lock and key, to the extent it is kept on paper, and access to electronically stored information and data should be restricted and password-protected. Records should be kept showing the amount of time, money, and energy that went into the creation of confidential and proprietary information that is claimed to be a trade secret. And records should be kept showing the value of such information to the organization.

Misappropriation of a Trade Secret

“Misappropriation”  of a trade secret takes place when the (1) acquisition of a trade secret was acquired by “improper means;” or the disclosure or use of a trade secret was made without the express or implied consent of the owner of the information and the person who acquired the information (a) used improper means to acquire knowledge of the trade secret; or (b) at the time of disclosure or use, knew or had reason to know that the knowledge of the trade secret was derived from or through a person who had utilized improper means to acquire it, or was acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use, or was derived from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use. “Improper means” includes theft, bribery, misrepresentation, breach or inducement of a breach of a duty to maintain secrecy, or espionage through electronic or other means.

Companies must therefore guard against the use of improper means by individuals who wish to take their trade secrets. Non-disclosure agreements and other agreements requiring confidentiality are a good start. Limiting access and protecting against unauthorized access are also valuable tools to maintain confidentiality.

If your company’s trade secrets have been compromised, or to seek counsel from our Litigation practice group, please reach out to request a consultation or call us at 216-696-1422.

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This information is provided for general informational purposes only and should not be construed as legal advice. Readers should consult with qualified legal counsel regarding their specific circumstances before taking any action based on the information presented.

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What is a Contract?

A contract is generally defined as a promise, or a set of promises, actionable upon breach. The essential elements of a contract include an offer, acceptance, contractual capacity, consideration (the bargained-for legal benefit and/or detriment), a manifestation of mutual assent, and legality of object and of consideration.

Contracts can be either written, verbal, or implied. Even agreements that aren’t fully finalized can be enforced, as long as both sides clearly meant to be bound by the deal and the terms are specific enough to follow through.

When Do Contracting Parties Find Themselves in Dispute?

Aside from the failure to exchange the agreed-upon consideration (i.e., the failure to perform or to pay), this article will informally explore some of the five (5) most common contract disputes.

1. Ambiguous Contract Language

The first, and often most obvious, is when a contract is ambiguous. Contractual language is ‘ambiguous’ only where its meaning cannot be determined from the four corners of the agreement or where the language is susceptible to two or more reasonable interpretations. When both parties offer plausible interpretations of the agreement drawn from the contractual language itself, this demonstrates that the provision is ambiguous. Even when a contract is ambiguous, it can still be enforced, but courts (and juries) must look to extrinsic evidence, like communications or past behavior, to determine intention. In commercial contracts, evidence of course of performance, course of dealing, and usage of trade may be considered.

2. Disputes Over Indemnification Clauses

Frequently disputed contract terms include indemnification clauses, representations, warranty and covenant clauses, and limitations or exclusions of remedies. To avoid conflict and dispute, careful consideration should be given to the language used in these types of clauses.

The nature of an indemnity relationship depends on what the parties intended, as expressed by the contract’s language. Ohio courts interpret indemnity clauses strictly and will not extend them beyond what is clearly and unequivocally expressed. These clauses are typically used to shift or specify which party is responsible for errors, omissions, and/or performance (or lack thereof) under the contract.

3. Misrepresentations & Disputes Over Representations

A representation in a contract is an assertion or statement of fact, given by one party (maker) to induce another party (recipient) to enter into a contract or take some other action. A representation must be truthful to avoid claims of fraudulent inducement. Language may be used in a representation to avoid or limit the impact, such as “to the best of the maker’s knowledge” or “to the maker’s actual knowledge, without investigation.”

4. Warranty Disputes

A warranty is a promise that something is true. If that promise turns out to be false, the person making it may be responsible for any resulting harm. Warranties can cover both present conditions and future performance. Some warranties are express, which are clearly stated in the contract to induce a prospective purchaser to buy. Others are implied considering the nature of the deal, the relationship between the parties, or the surrounding circumstances. In a warranty, a maker should only give truthful statements and should use language to limit the impact.

A covenant is a promise or agreement about a future act. Some covenants are implied, while others are specific.

5. Limitations or Exclusions of Remedies

A limitation or exclusion of remedies must be a part of the parties’ bargain in fact. These clauses are used to prevent certain types of damages or remedies, including indirect, consequential, punitive, or treble damages. Limitations or exclusions of damages or remedies should stand out in the contract, so they are brought to the other’s attention, often in bold print, all capitals, and/or larger print.

For all contract provisions, clear and concise language should be used. Parties should read and re-read all provisions, including the fine print.

To seek counsel from our Litigation practice group, please reach out to request a consultation or call us at 216-696-1422.

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In celebration of National Small Business Month, we proudly recognize the contributions of small businesses in our community. McCarthy Lebit is committed to supporting entrepreneurs and business owners with trusted legal guidance through every stage of their journey, from formation to growth and beyond. As a law firm deeply connected to the small business community, we’re proud to serve as trusted advisors and advocates for business owners throughout the region.

This information is provided for general informational purposes only and should not be construed as legal advice. Readers should consult with qualified legal counsel regarding their specific circumstances before taking any action based on the information presented.

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Consequences of Expensive Legal Discovery

As a result, many meritorious lawsuits are no longer filed – lawsuits that would have been pursued twenty years ago, which could have led to more affordable and efficient resolutions. For some, the rising costs of litigation have made it a less practical tool for businesses to protect their contractual rights, intellectual property, and other important relationships.

The increasing expenses associated with discovery, expert testimony, and electronic searches have priced many businesses out of seeking legal recourse, particularly in cases where the potential damages might not justify the high costs of litigation. This shift has diminished the ability of businesses to hold parties accountable and resolve disputes effectively.

Minimizing Discovery Costs in Litigation

While it’s unrealistic to expect everyone to revert to paper communications again, we can reduce the cost of discovery in litigation by imposing greater limits on what can be discovered without a court order. Many jurisdictions have already taken steps in this direction by limiting the number of interrogatories that can be served without permission. However, interrogatories have historically been one of the least effective tools in written discovery, often resulting in responses that provide minimal substantive value. By focusing on more meaningful and targeted discovery methods, and restricting excessive or unnecessary requests, we can help lower costs and make litigation more accessible.

The same approach should be applied to document requests and requests for admissions. While most attorneys do not misuse requests for admissions, some attorneys engage in practices that push the boundaries of reasonableness. For example, in a current case, the plaintiff’s lawyers have asked each of the multiple individual defendants to respond to more than seventy requests to admit! This is an excessive and burdensome use of the discovery process. To prevent such tactics, there should be a firm limit on the number of such requests, with the sole exception being those related to admitting the authenticity of documents. This would help ensure that discovery remains efficient and proportional to the needs of the case.

Similarly, document requests can be the most burdensome of all discovery tools and should be limited in number and scope – perhaps to limits set based on the type and size of the lawsuit.  Obligating those receiving massive document requests to seek protective orders is not an adequate solution, since many courts routinely deny those motions. 

Balancing Discovery Limits

Will these limits result in some potentially useful information being withheld? Of course, but the tradeoff is that litigation will likely become more affordable and accessible overall. For those who have devoted their careers to business litigation, this would be an unambiguously positive development.

To seek counsel from our Litigation group, please reach out to request a consultation or call us at 216-696-1422.

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This information is provided for general informational purposes only and should not be construed as legal advice. Readers should consult with qualified legal counsel regarding their specific circumstances before taking any action based on the information presented.

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The Uncertainty Surrounding Expert Opinions in Summary Judgment

Do expert opinions – often included in the reports exchanged between counsel before trial, play a meaningful role in supporting or challenging motions for summary judgment? The relationship between Rule 56, which governs summary judgment, and expert testimony is unclear under current Ohio law, leading to inconsistent rulings and uncertainty.

What Evidence Can Courts Consider Under Rule 56?

Rule 56(C) of the Ohio Rules of Civil Procedure describes what types of evidence the courts may consider when deciding motions for summary judgment. The fundamental question in these motions is whether “it appears from the evidence or stipulation, and only from the evidence or stipulation, that reasonable minds can come to but one conclusion and that conclusion is adverse to the party against whom the motion for summary judgment is made, that party being entitled to have the evidence or stipulation construed most strongly in the party’s favor.” (emphasis supplied). In simpler terms, does the evidence make it clear that there is no genuine dispute of material fact, leaving only one possible outcome?

That evidence is stated to include “the pleadings, depositions, answers to interrogatories, written admissions, affidavits, transcripts of evidence, and written stipulations of fact.” Where do expert reports fit into this list? Attorneys often try to insert expert reports into summary judgment consideration by attaching them to affidavits in which the expert certifies that the report accurately reflects their opinion on the issue at hand. However, Rule 56 (C) does not mention opinions as valid evidence for summary judgment. So, how should courts handle expert opinions submitted in this way? As the 9^th Circuit noted in United States v. Various Slot Machines on Guam, 658 F.2d 697, 700 (9^th Cir. 1981), “we have difficulty with the notion that to state an opinion is to set forth specific facts.”

Conflicting Expert Opinions: Do They Preclude Summary Judgment?

In some cases, an expert opinion is literally part of the cause of action being asserted. For example, in a medical malpractice suit, an opinion by a physician that the defendant’s conduct did not meet the standard of care in the profession may be required to state a claim. However, that is not the situation in most civil litigation.

The acute problem posed by this situation is how much weight, if any, a court must give to an expert’s opinion when the expert has not been cross-examined by opposing counsel and the court is forbidden to weigh the evidence on cross-examination. In other words, summary judgment is supposed to be limited to cases where “there is no genuine issue as to any material fact.” So, are expert opinions to be treated as “facts” for this purpose? If so, does a conflict of expert opinions preclude a grant of summary judgment for either party? If that is the case, then any party can defeat any motion for summary judgment by hiring an expert and submitting the expert’s report in opposition to any position taken by the movant.

For example, in Miller v. Bike Ath. Co., 80 Ohio St. 3d 607, 617 (1998), the Ohio Supreme Court reversed a summary judgment ruling, stating that “[s]ince these opinions are in direct conflict with those opinions expressed by appellees’ experts, there remain genuine issues of material fact on the liability issues presented.”

It seems unlikely that the drafters of Rule 56 intended that outcome. If expert opinions attached to verifying affidavits are not to be treated as “facts,” then how should they be treated in summary judgment proceedings? More importantly, should they be considered at all?

Can Courts Weigh Expert Testimony Without Cross-Examination?

In trial situations, courts can fully evaluate expert testimony, including cross-examinations that challenge the expert’s qualifications, methodology, or conclusions. However, under Rule 56, courts are forbidden to weigh testimony. See, on this point, DiBiasi v. First Seventh-Day Adventist Cmty. Church, 2014-Ohio-2702, ¶ 32 (11^th District). Without observing the expert’s demeanor, assessing their credibility, or allowing cross-examination, how can a court determine the weight of an expert’s report in a summary judgment decision?

A Possible Solution: Limit the Role of Expert Reports in Summary Judgment

There does not appear to be any way out of this conundrum. The most sensible solution would be for courts to refuse to consider any expert opinion testimony on motions for summary judgment. Otherwise, Rule 56 risks becoming ineffective. Courts should examine the material facts to see if any are in conflict. If they are not, judgment should be rendered according to the law, regardless of the opinions of expert witnesses.

For more information or to seek counsel from our Litigation group, please reach out to request a consultation or call us at 216-696-1422.

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This information is provided for general informational purposes only and should not be construed as legal advice. Readers should consult with qualified legal counsel regarding their specific circumstances before taking any action based on the information presented.

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Definition & Scope of SLAPP Protections

Senate Bill 237 aims to prevent Strategic Lawsuits Against Public Participation (SLAPP), which are intended to stop individuals or groups from using their First Amendment rights in discussions about public issues. SLAPP lawsuits are often time-consuming and expensive for the individual or organization being sued. 

Senate Bill 237 creates an expedited process for individuals engaging in speech protected by the United States and Ohio Constitutions to have these lawsuits dismissed if they meet certain criteria. The bill also allows a successful defendant to recoup attorney fees and other court fees if the case is dismissed, removing the financial burden of SLAPP cases.

Specifically, SB 237 applies to a cause of action asserted in a civil action against a person based on any of the following:

1. The person’s communication in a legislative, executive, judicial, administrative, or other governmental proceeding;
2. The person’s communication on an issue under consideration or review in a legislative, executive, judicial, administrative, or other governmental proceeding;
3. The person’s exercise of the right of freedom of speech and of the press, the right to assemble and petition, and the right of association, guaranteed by the United States Constitution or the Ohio Constitution, on a matter of public concern.

Expedited Relief for SLAPP Defendants

In such a case, a defendant has a right to seek expedited relief to dismiss the civil action or claim. If expedited relief is sought, the Court may stay all other proceedings in the action, including discovery, and any other pending hearings or motions.

Criteria for Case Dismissal

In ruling on the motion for expedited relief, the court must dismiss with prejudice a cause of action, or part of a cause of action, if all of the following apply:

1. The moving party establishes that the cause of action is based on a communication or action described in division (B) of section 2747.01 of the Revised Code;
2. The responding party fails to establish that this chapter does not apply to the cause of action due to an exception in division (C) of section 2747.01 of the Revised Code;
3. Either the responding party fails to establish a prima-facie case for each essential element of the cause of action or the moving party establishes one of the following: (a) The responding party failed to state a cause of action upon which relief can be granted. (b) There is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law on the cause of action or part of the cause of action.

Ohio courts are now required to rule on the motion for expedited relief not later than sixty days after the hearing.

Awarding Attorney Fees & Costs

Ohio courts will be required to award reasonable attorney’s fees, court costs, and other reasonable litigation expenses to the moving party if successful.

Broad Application of First Amendment Protections

Courts must broadly construe and apply the new law so as to protect the exercise of the right of freedom of speech and of the press, the right to assemble and petition, and the right of association, guaranteed by the United States Constitution and the Ohio Constitution.

Final Appealable Order

A decision granting or denying expedited relief is a final appealable order.

For more information or to seek counsel from our Litigation group, please reach out to request a consultation or call us at 216-696-1422.

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This information is provided for general informational purposes only and should not be construed as legal advice. Readers should consult with qualified legal counsel regarding their specific circumstances before taking any action based on the information presented.

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Initiating the Lawsuit

Let’s start at the beginning: a dispute between two or more parties. Depending on the nature and scope of the dispute, the parties may attempt to resolve the matter before involving attorneys.  Doing so is not without risks, however.  Engaging legal counsel at the outset of a dispute can help parties better understand both the immediate and long-term ramifications of a dispute and protect their interests.

If the dispute cannot be resolved in preliminary negotiations, the plaintiff will then file a complaint in a court of competent jurisdiction.  This kicks off the pleadings stage of a lawsuit, which is where the parties state their general positions.  The complaint sets forth the plaintiff’s version of the facts, along with any claims the plaintiff wishes to bring against the defendant. 

With the complaint, the plaintiff also files a request that a summons be issued to the defendant.  Upon being notified of the complaint, the defendant must then file an answer (typically within 28 days of being served).  In the answer, the defendant either admits or denies the plaintiff’s allegations.  The defendant can also file a counterclaim in order to bring their own claims against the plaintiff.  The plaintiff must then file an answer to the defendant’s counterclaim.

Alternatively, the defendant might file a motion to dismiss in response to a complaint, which, if granted, means the court will dismiss some or all of the plaintiff’s claims.  A motion to dismiss can be based on various grounds, from lack of subject matter or personal jurisdiction to insufficient service of process.  Frequently, a defendant will file a motion to dismiss on the grounds that the plaintiff failed to state a claim upon which relief can be granted.

Once the parties have exchanged pleadings, the court will typically hold a case management conference at which the parties address any initial issues, plan discovery, and set the general trajectory for the case.

Initiating a lawsuit involves a structured process that begins with a complaint and unfolds through a series of steps aimed at defining each party’s position. This stage is just the beginning of a complex journey that includes discovery, motions, potential settlements, and, in some instances, a trial or appeal. Whether you’re a party in a dispute or simple curious about the litigation process, understanding these stages can help demystify the legal process and illustrate how cases progress through the court system.

To seek counsel from our team of skilled litigation attorneys, please reach out to request a consultation or call us at 216-696-1422.

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This information is provided for general informational purposes only and should not be construed as legal advice. Readers should consult with qualified legal counsel regarding their specific circumstances before taking any action based on the information presented.

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What Was Chevron Deference?

In Chevron v. Natural Resources Defense Council (“Chevron”), the Supreme Court set forth a “two-part framework” for resolving challenges to a federal agency’s interpretation of a statute. Where Congress was ambiguous or silent on the issue, the Chevron doctrine stated that courts should defer to the agency’s interpretation. 

The rationale was that agencies were the best suited to make those policy choices that were left open because they were more experienced in their fields than courts.

Loper Bright Enters. v. Raimond

In Loper Bright Enters. v. Raimond (“Loper Bright”), fishing groups challenged the National Marine Fisheries Service’s (“NMFS”) final rule that required fishermen to pay costs of having federal compliance monitors on their ships. They argued that NMFS did not have statutory authority to mandate that they pay for observers required by a fishery management plan. Applying the Chevron doctrine, the lower courts found NMFS’s regulations permissible.

The Supreme Court granted certiorari in these cases, limited to the question of whether Chevron should be overruled or clarified. Ultimately overruling Chevron, the Court characterized the doctrine as an unworkable and misguided framework.

Chief Justice Roberts, writing for the majority, emphasized it was the courts’ traditional role to say what the law is. According to the Court, Chevron defies the command of the APA—that the reviewing court is to decide all relevant questions of law—by requiring a court to ignore that reading and defer to an agency’s interpretation.

The Court held that courts must exercise their independent judgment in deciding whether an agency has acted within its statutory authority, and they may not discharge this duty of interpretation to an agency just because the statute is ambiguous or silent.

However, federal agencies are not left powerless. Although a reviewing court is not bound to an agency’s interpretation when deciding legal questions, it may rely on it as guidance. Under Skidmore v. Swift (“Skidmore”), courts may consider the agency’s “power to persuade” by weighing certain factors—the thoroughness of consideration, validity of its reasoning, and consistency with earlier and later pronouncements. Meaning that an agency’s interpretation may still hold persuasive power, even though it lacks controlling power. Federal courts have long used this approach when reviewing informal, non-binding interpretations issued by agencies.

Further, where Congress expressly delegates authority to an agency in the statute, the reviewing court’s role will be limited to ensuring the agency is acting within those boundaries.

The Court noted that this decision overturned Chevron itself, not judicial decisions made using Chevron deference. It further stated that mere reliance on Chevron cannot constitute a special justification for overruling such a holding.

Looking Ahead

The impact of Loper Bright’s decision may not be immediate, leaving open a lot of uncertainty while the legal and regulatory landscapes adapt to the post-Chevron world.

Loper Bright calls for Congress to have a clear intent when enacting statutes. This may include specific directions to ensure statutes are sufficiently authorizing the desired agency action. Congress may also need to engage in looking back on previous legislation to fill existing legislative gaps or ambiguities. 

For federal agencies, the removal of deference will make it easier for new regulations to be challenged, leading to more cautious rulemaking. However, the Court noted that Skidmore is still good law, meaning it can be expected that courts may continue to adopt agency rules and interpretations that are persuasive or backed up by significant experience.

Courts may see an uptick in litigation, either from challenges to new regulations, challenges to old rulings, or both. Absent explicit delegation of interpretative authority, there will be more opportunities to challenge inconsistent or unreasonable regulations without having to overcome automatic agency deference.

Now that judges must exercise independent legal judgment when faced with statutory ambiguity, this may lead to a legal patchwork of interpretations by geographical area. As a result, regulated entities will face heightened uncertainty regarding the validity of agency regulations. Without the Chevron doctrine, it will be difficult to predict whether a reviewing court will uphold an agency’s construction of a statute.

For now, uncertainty about Loper Bright’s full impact remains. Our team of attorneys can assist regulated entities with evaluating the potential impacts on their businesses and any legal and regulatory hurdles they may face following this decision. For more information, please reach out to request a consultation or call us at 216-696-1422. McCarthy Lebit would like to thank law clerk Grace Warren for her effort in assisting with the preparation of this legal blog post for The More Report.

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This information is provided for general informational purposes only and should not be construed as legal advice. Readers should consult with qualified legal counsel regarding their specific circumstances before taking any action based on the information presented.

The post Supreme Court Overturns the Chevron Doctrine: What it Means and its Potential Implications appeared first on McCarthy Lebit - A Cleveland/Ohio Law Firm.

First, needless to say, contact your attorney and schedule a face-to-face meeting. Virtual meetings through platforms like Zoom or Teams are helpful, but they are no substitute for a face-to-face meeting, where documents can be reviewed, and plans and strategies agreed upon.

Second, gather and organize all relevant contracts, demands, notices, communications, emails, and text messages exchanged among you, your business, its employees, and the adverse party.

Third, issue a litigation hold to all employees and other representatives. A litigation hold should instruct all employees and other representatives to refrain from deleting or destroying evidence including contracts, notices, communications, emails, and text messages.

Fourth, make sure you understand the contract provisions including, in particular, any notice of default, termination provisions, venue selection clauses, and contract provisions purporting to limit the time in which to submit a claim or file a lawsuit. Frequently, a contract will require notice of default and opportunity to the other side to cure said default.

Fifth, immediately take steps to mitigate or minimize your damages. This may include finding alternative sources of supplies or hiring a replacement contractor to repair, replace or complete your project. That said, you should not engage in remediation work without giving the adverse side an opportunity to inspect the current state of the project.

Sixth, make sure you understand the timing of default occurrences, as many contracts contain shortened limitation periods for filing suits. Furthermore, these contracts may impose restrictions on the venue for legal proceedings and the applicable laws. Many contracts also contain mandatory mediation and/or arbitration provisions which must be complied with.

Seventh, in collaboration with your attorneys, interview key employees and other representatives to determine what information they possess. Additionally, steps should be taken to preserve this information through witness statements or affidavits, if deemed necessary.

Eighth, work with your attorney to establish a litigation budget and litigation plan as soon as possible. However, it’s essential to keep in mind that litigation entails risks and significant expenses. Therefore, it’s crucial to regularly review, update, and revise budgets and litigation plans to accommodate any developments that arise as the litigation progresses.

For more information or to seek counsel from our team of litigation attorneys, please reach out to request a consultation or call us at 216-696-1422.

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This information is provided for general informational purposes only and should not be construed as legal advice. Readers should consult with qualified legal counsel regarding their specific circumstances before taking any action based on the information presented.

The post Armoring Your Business in Preparation for Litigation appeared first on McCarthy Lebit - A Cleveland/Ohio Law Firm.