DOJ’s Data Security Program: Key Compliance Considerations for Impacted Entities

Go-To Guide

The Department of Justice’s new Data Security Program (DSP), effective April 8, 2025, imposes significant restrictions on U.S. government contractors and global companies that handle sensitive U.S. personal or government-related data. 
U.S. persons and organizations that transfer, share, or provide access to such data must assess whether their transactions involve designated countries of concern and covered persons. 
The DSP requires new due diligence, recordkeeping, reporting, and annual auditing obligations, with full enforcement beginning July 8, 2025. Non-compliance can result in severe civil and criminal penalties.

On April 11, 2025, the DOJ’s National Security Division (NSD) issued a Compliance Guide, Implementation and Enforcement Policy, and FAQs for its Data Security Program (DSP), finalized pursuant to Executive Order 14117 and the 28 C.F.R. Part 202. The DSP is primarily designed to prevent certain cross-border data flows and transactions. Individuals and companies subject to the DSP are required to comply with new security requirements, reporting and recordkeeping duties, and due diligence rules.
The recently issued guidance makes evident NSD’s intent to make the DSP an enforcement priority for this administration. Access to Americans’ bulk sensitive or personal data or U.S. government-related data increases the ability of countries of concern to engage in a wide range of malicious activities. The DSP is currently subject to a 90-day initial enforcement period, which is a limited enforcement window to give individuals and companies additional time to bring their transactions and processes into compliance with the DSP. After July 8, 2025, NSD will implement full enforcement of the DSP. 
Click here to continue reading the full GT Alert.

Congress Should Use Budget Bill to Strengthen IRS Whistleblower Program

Since it was established in 2006, the Internal Revenue Service (IRS) Whistleblower Program has dramatically bolstered the United States’ efforts to crack-down on tax fraud schemes, identify tax cheats, deter would-be fraudsters and overall shrink the tax gap. In the less than two decades the program has been in operation, it has led to the recovery of over $7 billion while conserving the IRS’s time and resources.
However, in recent years, a number of issues have begun to plague the program, as delays have ballooned while payouts to whistleblowers have shrunk down. These issues threaten to undermine a critical and cost-effective tool in the United States’ anti-tax fraud arsenal by disincentivizing insiders from coming forward and utilizing the program. 
Luckily, there has been bipartisan support in Congress for fixing the issues plaguing the IRS Whistleblower Program. The provisions found in the IRS Whistleblower Program Improvement Act, introduced by Senators Chuck Grassley (R-IA) and Ron Wyden (D-OR) during the last session of Congress were included in the draft discussion of the Taxpayer Assistance and Service Act unveiled earlier this year by Senators Wyden and Mike Crapo (R-ID).
These critically needed provisions have not been included in the budget reconciliation bill currently being considered by the Senate, however.
Including the reform provisions of the IRS Whistleblower Program Improvement Act in the budget bill will encourage and increase reporting to the IRS Whistleblower Program, leading to greater recoveries and enabling the IRS to be more efficient in their investigations with fewer resources.
Power of the IRS Whistleblower Program
Shortly after it was established in 2006, the Internal Revenue Service (IRS) Whistleblower Program demonstrated its potential to revolutionize the United States’ efforts to crack down on tax fraud and shrink the tax gap.
The monetary awards and protections offered by the program shifted the calculus for tax whistleblowers across the globe. Suddenly, the benefits of reporting tax fraud to U.S. authorities outweighed the benefits of keeping quiet and aiding in the fraud. Tax whistleblowing became a rational economic activity for bankers and other insiders.
Most notably, in 2009, UBS banker Bradley Birkenfeld came forward and blew the whistle on a major offshore banking scheme to hide U.S. taxpayer funds in Switzerland. While Birkenfeld came away with a record $104 million award, the benefits for the United States were even larger. According to University of California Davis law Professor Dennis Ventry:
“Thanks to [the] whistleblower . . . the U.S. government (take a deep breath) received: $780 million and the names of 250 high-dollar Americans . . . another 4,450 names and accounts of U.S. citizens . . . 120 criminal indictments of U.S. taxpayers and tax advisors . . . the closure of prominent Swiss banks . . . $5.5 billion collected from the IRS Offshore Voluntary Disclosure Program (OVDP), with untold tens of billions of dollars still payable . . .”
Overall, whistleblowers reporting under the IRS Whistleblower Program have directly allowed the United States to recover nearly $7 billion while the program’s deterrence effect has led to the payment of billions of dollars more in taxes from those who would be otherwise inclined to cheat the tax system but are wary of a whistleblower coming forward. A study of the similarly structured tax whistleblower award provisions within New York state’s False Claims Act found that that tax whistleblower program brought in an extra 7.7% in state tax revenue and that firms reduced their state tax avoidance in response both to the passage of the law and to press releases about tax whistleblower settlements.
“These whistleblower laws do work, and they’re reasonably inexpensive from a government perspective,” says Aruhn Venkat, one of the study’s authors and assistant professor of accounting at Texas University’s McCombs School of Business.
Crucially, the IRS Whistleblower Program helps the IRS be more efficient with its enforcement efforts and focuses its efforts on large tax cheats, since the program only covers matters where the amount of taxes in dispute exceeds $2 million. Whistleblowers come forward, identify bad actors, and provide valuable evidence about tax fraud. This allows the Commission to focus its efforts on recovering taxpayer funds from these high net-worth bad actors and not chase down the rabbit-hole of seeking enforcement avenues among the majority of honest taxpayers.
Recent Issues
The IRS Whistleblower Program’s recent annual reports to Congress detail a program facing issues. The annual money recovered by the program fell from $1.44 billion in Fiscal Year 2018 to just $245 million in Fiscal Year 2021 and the agency’s payouts to whistleblowers dropped from $312 million to $36 million over those same years. 
In recent years, those totals have rebounded from those 2021 lows but still fall short of the numbers from 2018 and preceding years. In FY 2023, the IRS awarded $88.7 million to whistleblowers based on the $337 million the agency was able to collect thanks to whistleblower disclosures.
Even more troubling are the statistics on the average processing time for whistleblower award claims. The time to process mandatory award payments is up to an average of 11.29 years and there is a total backlog of 30,135 cases.
These delays are troubling, not just for the hardships they cause whistleblowers, but because of the way in which the disincentive would-be whistleblowers from coming forward. In 2006 (before the IRS whistleblower law was modernized), the Treasury Inspector General for Tax Administration raised concerns in a report that the average 7 1/2 year processing time for awards was undermining awards’ effectiveness as an incentive.
“If the claims are not timely processed, the rewards may lose some of their motivating value,” the TIGTA report stated. It further noted that cutting processing time “would make the Program more attractive to future informants wishing to report violations of tax laws.”
In recent years, the IRS Whistleblower Office has worked hard to address the issues plaguing the program, including increasing staffing at the office, disaggregating whistleblower claims to speed up award payouts, and demonstrating more dedication to working alongside whistleblowers and their representation.
While these administrative actions have made an impact, Congressional action is still urgently needed on the issue.
Critical Reforms
The whistleblower provisions found in the IRS Whistleblower Improvement Act and Taxpayer Assistance and Service Act directly address a number of the major issues plaguing the program through technical but common-sense reforms which fully align with the original intent behind the program.
The reforms include:

Imposition of interest on delayed awards. In order to reduce the debilitating delays in the processing of whistleblower award claims, the bill imposes a fairly modest interest payment onto whistleblower awards which the IRS delays at least 1 year in issuing.
Institution of de novo review in award case appeals. The bill gives whistleblowers a realistic opportunity to oppose an illegal or improper denial of an award. Under the amendment, if the IRS denies an award, the whistleblower can challenge the denial in Tax Court under the de novo standard of review. This simply means that the whistleblower can conduct discovery and can learn the actual basis for a denial and challenge it before an independent judge. This provision is designed to ensure that the IRS finally and properly adjudicates all whistleblower cases and will subject the IRS to accountability if they fail to implement the law as intended by Congress.
Removal of budget sequestration for whistleblower awards. The IRS program is the only whistleblower program in which an administrative agency reduces the amount of an award based on the budget sequestration rules adopted under President Obama. Applying budget sequestration to whistleblower payments is unjustifiable and results in payments below the mandatory statutory minimum award amount of 15% of the funds collected by the IRS in the relevant enforcement action. The amendments will fix that.

Other reforms in the bill include requiring more details in the IRS Whistleblower Program’s annual reports to Congress, aligning the program’s handling of attorney’s fees with other whistleblower award programs, and establishing the presumption of anonymity for whistleblowers.
A Cost Effective Program
A hurdle for the reforms’ passage has been the Joint Committee on Taxation’s (JCT) scoring of the IRS Whistleblower Improvement Act’s provisions, which suggest that the reforms would be costly and increase the budget. However, this is misleading about the cost effectiveness of the IRS Whistleblower Program and of cost-benefit of reforms making that program more effective.
Overall, the IRS Whistleblower Program has proven to be highly cost effective. Years ago, in reviewing the importance of tax whistleblowers, the IRS “estimated the IRS incurred slightly over 4 cents in cost (including personnel and administrative costs) for each dollar collected from the Informants’ Rewards Program (including interest), compared to a cost of over 10 cents per dollar collected for all enforcement programs.” A 2021 research paper estimated that “that the average whistleblower complaint at the IRS generates around $30,664 in tax revenues, and costs $590 to process.”
Furthermore, the previously discussed study on the NY State False Claims Act’s tax provisions found that the program had a 3,000 percent return on investment. A report from the U.K.’s Royal United Services Institute (RUSI) details that the Commodity Futures Trading Commission (CFTC) Whistleblower Program (a similar program to the IRS’) had “a gross operating profit of more than US$2.6 billion” over a ten year period.
The JCT scoring of the reform provisions found that the removal of budget sequestration on awards and the institution of de novo review could increase the amount awarded to whistleblowers and thus increase the costs of the program.
The scoring underestimates, however, the extent to which these reforms will make the program more attractive to whistleblowers, leading to more highly quality tips and thus increasing the funds recovered by the program.
Conclusion
An IRS Whistleblower Program which works for whistleblowers is necessary for the program to reach its full potential as an immensely cost-effective enforcement tool with an expansive deterrent effect. The technical reforms found in the IRS Whistleblower Improvement Act make the program more attractive to would-be-whistleblowers by addressing the debilitating delays and hurdles to full award payments currently plaguing the program.
By including these provisions in the One Big Beautiful Act, Congress will be increasing the ability of the IRS to recover unpaid taxes from fraudsters, bolstering the federal budget in one of the most efficient means possible.
Geoff Schweller also contributed to this article.

Maybe So, Maybe Not: Mississippi AG’s Office Opines That Mississippi Law Prohibits Most Consumable Hemp Products While Recognizing Opinion’s Limitations

All participants of Mississippi’s cannabis industry should take notice of an opinion the Mississippi Attorney General’s Office published on June 11, 2025. The opinion answered three questions Mississippi Rep. Lee Yancey presented: (1) Is the sale of non-FDA approved hemp-derived products designed for human ingestion and/or consumption prohibited in Mississippi; (2) is the possession of non-FDA approved hemp-derived products designed for human ingestion and/or consumption prohibited in Mississippi; and (3) if the answer to the first two questions is yes, are municipalities authorized to enact rules and regulations that prohibit or penalize the sale and/or possession of the same?
The attorney general, relying on Mississippi’s Uniform Controlled Substances Law (MSCSL), answered the first two questions in the affirmative, concluding that the terms of the MSCSL prohibited the sale and possession of such products unless they were being sold or possessed pursuant to the provisions of Mississippi’s medical cannabis laws and regulations. The opinion, however, notes its limitations by acknowledging that components of the analysis are controlled by federal law: “[A] complete response to [Yancey’s] request is outside the scope of an official opinion.”
The opinion focuses on two exemptions to the MSCSL’s prohibition of THC but recognizes a third. THC, the psychoactive ingredient in cannabis, is illegal under the terms of the MSCSL, however, several exemptions to this prohibition exist. Two of these exemptions, forming the basis of the AG’s opinion, make an allowance for hemp products that have been approved for human ingestion and/or consumption by the FDA or products possessed or sold under Mississippi’s medical cannabis laws. The third exemption (mentioned briefly in the opinion) exempts “hemp,” as defined and regulated under the Mississippi Hemp Cultivation Act (MHCA), from the MSCSL. The MHCA defines hemp in a manner similar to the 2018 Farm Bill, stating that hemp includes all derivatives, extracts and isomers. While many have interpreted the third exemption as allowing the sale and possession of hemp as long as it meets the MHCA’s definition (an interpretation adopted across the country under the Farm Bill’s same definition of hemp), the Attorney General’s Office appears to take a different stance.
In a footnote, the attorney general seems to suggest that since the MHCA has not been fully implemented, the exemption referencing the act may not apply. This positioning points towards the attorney general’s stance being that unless a hemp product is approved for human consumption by the FDA or handled pursuant to Mississippi’s medical cannabis laws, its sale and possession are prohibited by the MSCSL – regardless of what the hemp cultivation act says. That said, the opinion reiterates that because the cultivation of hemp in Mississippi “is legalized, licensed, and controlled by federal law [and] this office cannot opine on questions of federal law [,]… to the extent federal law controls the issues presented in your request, a complete response is outside the scope of an official opinion.”
The opinion, while briefly referencing the MHCA, does not explain additional exemptions to the definitions of both THC and marijuana under the MSCSL for hemp. Again, the opinion generally acknowledges that hemp, as defined in the MHCA and 2018 Farm Bill, is not controlled under MSCSL. But because such analysis is, at least in part, controlled by federal law, the opinion ends its discussion with just these acknowledgments.
While the AG’s opinions are not considered binding precedent, this opinion undoubtedly garnered the attention of Mississippi’s consumable hemp industry and medical cannabis industry alike and rightly so. There’s also little doubt that the opinion will be used as support next legislative session when yet another hemp bill is introduced.
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California Senate Passes Nation’s First Bill for Accessibility Violation Cure Period

The California Senate recently passed legislation (Senate Bill No. 84) that would require a plaintiff to give a qualified business notice and 120 days to cure an accessibility violation before filing a lawsuit seeking statutory damages and attorneys’ fees. The bill would create the nation’s first true safe harbor for businesses with fifty or fewer employees who are willing and able to address any barriers to access in 120 days. The bill now heads to the California Assembly.

Quick Hits

The California Senate has passed SB 84, which mandates a 120-day notice and cure period for accessibility violations before a plaintiff can file a lawsuit seeking statutory damages and attorneys’ fees.
SB 84 aims to create a safe harbor for businesses with fewer than fifty employees, allowing them to address accessibility barriers within 120 days to avoid statutory damages and legal fees.
If enacted, SB 84 would provide a “fix-it-first” pathway for small California businesses, potentially influencing similar federal protections in the future.

Landscape of Disability Access in California
California has long occupied center stage in the national conversation on accessibility litigation. High statutory penalties, no-fault liability, and liberal fee-shifting rules have turned the Golden State into a magnet for plaintiffs’ lawyers who focus on “construction-related accessibility claims” under both the federal Americans with Disabilities Act (ADA) and parallel state statutes, such as the Unruh Civil Rights Act (Unruh). Senate Bill 84 (SB 84) represents Sacramento’s most consequential attempt in nearly a decade to recalibrate that landscape.
California Civil Code §§ 52 and 54.3 authorize minimum statutory damages of $4,000 per visit for accessibility violations—subject to trebling—plus mandatory attorney’s fees. Those generous remedies, combined with federal ADA claims, led to a wave of high-frequency lawsuits in California, many filed by professional plaintiffs. Small businesses frequently complained that a single missed sign or faded parking stripe could trigger five-figure settlements. Prior reforms tried to soften the blow, but largely preserved strict liability and allowed litigation to multiply. By 2024, legislators faced mounting pressure to extend genuine “fix-it first” opportunities and curb perceived litigation abuse. SB 84 is the legislature’s answer.
SB 84’s New Requirements, Protections, and Limitations
Under SB 84, a party intending to seek statutory damages would be required to first serve a detailed letter “specifying each alleged violation” on the defendant. A lawsuit for statutory damages may not be filed unless—or until—those alleged violations remain unremedied 120 days after service. If the business corrects every cited violation within the 120-day window, it owes no statutory damages, plaintiff’s attorney’s fees, or costs for those items. This is a true safe harbor, rather than the mere possibility of damages reduction under certain existing circumstances.
It is important to note that SB 84 would only apply to defendants that have fifty or fewer employees overall. Businesses with more employees would remain subject to pre-existing rules. SB 84 also does not limit an individual’s right to sue for an injunction and does not disturb a court’s equitable powers.
Key Takeaways

If passed, SB 84 would provide a genuine “fix-it-first” pathway for California businesses with fifty or fewer employees, rendering them immune from statutory damages and fees if they repair cited violations within 120 days.
SB 84 would only benefit businesses with fifty or fewer employees, although plaintiffs’ lawyers may provide notice to other businesses not knowing how many employees they have.
Consider designating a compliance officer (in-house or external) to triage any notice letter so they are not missed. A handful of plaintiffs already provide “pre-litigation” notice of alleged violations and clients overwhelmingly report never receiving the notice.
Under SB 84, the clock on the time to cure the alleged violations starts ticking from the date of service, not the date the recipient opens the mail.
Businesses may want to take swift action in response to a notice letter, because 120 days passes quickly. Some architectural violations can be resolved quickly, such as adding accessible parking signage or adjusting the toilet paper dispenser location. However, many violations take time to assess and correct, such as adding ramps or correcting excessive sloping. This is especially where landlord/tenant buy-in or permitting is required.
“Notice and cure” bills requiring advanced notice under the ADA are regularly introduced in the U.S. Congress. Passage of SB 84 in California could clear the way to there being some chance that federal protections may follow.

Update: Senate Bill 6–A Texas Bill Impacting Large Load Development in ERCOT

As previously reported, Sen. Phil King and Sen. Charles Schwertner introduced Texas Senate Bill 6 (SB6) in February 2025. After various amendments and updates, the bill has passed the Texas House and Senate and is now before Governor Greg Abbott for his approval. If not vetoed, this bill will directly impact large load customers (specifically, electricity consumers of more than 75 megawatts (MW), unless the Texas Public Utility Commission (the PUCT) determines that a lower threshold is necessary) and entities currently in or contemplating a co-location arrangement in the Electric Reliability Council of Texas (ERCOT) region. SB6, or any other bill passed by the legislature, can also become law without Governor Abbott’s signature. 
The legislative purpose of SB6 is to ensure large load customers contribute to the recovery of interconnection costs, establish grid reliability protection measures, bring transparency and credibility to load forecasting, and protect customers from outages by requiring large loads to share the load shed obligation during times of shortage. 
Interconnecting Large Loads
SB6 requires the PUCT to adopt standards for interconnecting large load customers in ERCOT “in a manner designed to support business development in [Texas] while minimizing the potential for stranded infrastructure costs and maintaining system reliability.” SB6 further provides that the standards apply “to customers requesting a new or expanded interconnection where the total load at a single site would exceed a demand threshold established by the [PUCT] based on the size of loads that significantly impact transmission needs” in ERCOT. 
The PUCT’s standards must require (i) the large load customer to disclose to the interconnecting utility whether the customer is pursuing substantially similar requests that would result in a material change, delay, or withdrawal of the interconnection request; (ii) the large load customer to disclose to the interconnecting utility information about the customer’s on-site backup generation facilities (facilities not capable of exporting energy to ERCOT and that serve at least 50% of on-site demand); (iii) a flat study fee of at least US$100,000 to be paid to the interconnecting utility for initial transmission screening; (iv) a method for a large load customer to demonstrate site control for the proposed load location; (v) uniform financial commitment requirements for the development of transmission infrastructure needed to serve a large load customer—the standard must provide that satisfactory proof of financial commitment may include (a) security provided on a dollar per MW basis, (b) contribution in aid of construction, (c) security provided under an agreement that requires a large load customer to pay for significant equipment or services in advance of signing an agreement to establish electric delivery service, or (d) another form of financial commitment acceptable to the PUCT; (vi) uniform requirements for determining when capacity that is subject to an outstanding financial commitment may be reallocated; and (vii) procedures to allow ERCOT to access any information collected by the interconnecting utility to ensure compliance with the standards for transmission planning analysis. 
The purpose of many of these requirements is to provide ERCOT and the interconnecting utility with a better sense of which large load will move forward in the interconnection queue versus those that are duplicative or do not have the requisite site control or financial backing to move forward. The Texas Legislature recognized that these large loads are impacting ERCOT’s forecasting capabilities and that it is essential for ERCOT to have a better understanding of which large loads will and will not be built.
SB6 provides that, during an energy emergency alert, ERCOT may issue reasonable notice that large load customers with on-site backup generating facilities may be directed to either curtail load or deploy the customer’s on-site backup generation.
SB6 also directs the PUCT to establish criteria by which ERCOT includes forecasted large load of any peak demand in resource adequacy and transmission planning models and reports.
Co-Location
In addition to the interconnection standards addressed above, SB6 creates standards and requirements for the co-location of large load customers with existing generation resources. A co-location arrangement is an arrangement where generation and load are located near each other and the generation serves the load before the point of interconnection and without using the grid.
Under SB6, a power generation company, electric cooperative, or municipally owned utility must submit a notice to ERCOT before implementing a net metering arrangement between an operating stand-alone generation resource registered in ERCOT as of 1 September 2025 and a new large load customer. The provisions in this new Public Utility Regulatory Act section do not apply to a generation resource (i) that registered with a co-located large load customer at the time of energization (even if the load is energized at a later date), or (ii) where a majority interest is owned directly or indirectly as of 1 January 2025 by a parent company of the net metering customer.
ERCOT must study the system impacts of a proposed net metering arrangement and removal of the generation on the system. ERCOT must complete the study and submit the results to the PUCT with a recommendation by the 120th day after ERCOT received the request and associated information regarding the arrangement. The PUCT then would have 60 days from the date it receives the study results to approve, deny, or impose reasonable conditions on the proposed net metering arrangement (as necessary) to maintain system reliability. Such conditions may include (i) requiring customers to be held harmless for stranded or underutilized transmission assets resulting from the behind-the-meter operation, (ii) requiring the retail customer who is served behind-the-meter to reduce load during certain events, or (iii) requiring the generation resource to make capacity available to ERCOT during certain events. The PUCT is also permitted, if the conditions are not limited to a specific period, to review the conditions at least every five years to determine if they should be extended or rescinded. If the PUCT does not approve, deny, or impose conditions on the proposed net metering arrangement before the expiration of the 60-day deadline, then the arrangement is deemed approved. 
Demand Management
In addition to interconnection and co-location requirements, SB6 requires ERCOT to ensure that each transmission and distribution utility, electric cooperative, and municipally owned utility serving a transmission-voltage customer interconnected after 31 December 2025 develops a protocol, including the installation of necessary equipment or technology before the customer is interconnected, to allow the load to be curtailed during firm load shed, unless it is a “critical load industrial customer” or the load is designated as a “critical natural gas facility.” ERCOT will also develop a reliability service to competitively procure demand reductions from large load customers subject to the new rules established by the PUCT. 
Transmission Cost Allocation Methods Assessed
Finally, SB 6 requires the PUCT, by 31 December 2026, to evaluate whether the existing methodology used to charge wholesale transmission costs continues to appropriately assign costs for transmission investment. As part of this analysis, the PUCT must evaluate (i) whether the current four coincident peak method ensures that all loads appropriately contribute to the recovery of transmission costs, (ii) whether alternative methods to calculate wholesale transmission rates would more appropriately assign costs, and (iii) what portion of the costs related to access to and wholesale service from the transmission system should be nonbypassable. The PUCT is charged with evaluating whether the PUCT’s retail ratemaking practice ensures transmission cost recovery appropriately charges system costs to each customer class that causes those costs. The PUCT must begin this evaluation within 90 days of the earlier of either the governor’s signing of SB6 or 22 June 2025. After the PUCT completes its evaluation process, and no later than 31 December 2026, the PUCT must amend its rules to ensure wholesale transmission charges appropriately assign costs for transmission investment. 
While SB6 has passed both Texas chambers and is projected to not be vetoed by the Governor, the PUCT will still have a lot of work ahead of it to implement the various provisions in the statute. This will give interested parties an additional opportunity to have their voices heard during the process to implement this legislation.

NYC’s Enhanced ESSTA Rules for Prenatal Leave Create Policy, Posting + Paystub Requirements for Employers

Takeaways

Changes to NYC’s paid prenatal leave requirement take effect 07.02.25.
They incorporate and enhance NYS prenatal leave protections that went into effect at the beginning of this year.
NYC employers should understand their obligations and implement the changes to policies, notices, and recordkeeping.

Consistent with the expanding attention afforded to prenatal health and workplace protections nationally, New York State implemented a new paid prenatal leave requirement as an amendment to the state sick leave law, which went into effect Jan. 1, 2025. New York City recently amended its rules related to the Earned Safe and Sick Time Act (ESSTA) to incorporate the state prenatal leave protections and add enhanced requirements.
NYS Paid Prenatal Leave Rights
Since Jan. 1, 2025, all private-sector employers in New York have been required to provide up to 20 hours of paid prenatal leave in a 52-week period to eligible employees, regardless of company size. The 52-week leave period starts on the first day the prenatal leave is used.
The prenatal leave entitlement is in addition to the statutory sick leave entitlement and other paid time off benefits provided by company policy or applicable law, and it applies only to employees receiving prenatal healthcare services, such as medical exams, fertility treatments, and end-of-pregnancy appointments. Spouses, partners, or support persons are not eligible to use prenatal leave.
Employers cannot force employees to use other leave first or demand medical records or confidential health information to approve prenatal leave requests. (See NYS Paid Prenatal Leave: Employers Must Manage a New Entitlement in the New Year.)
NYC ESSTA Rules Incorporating Prenatal Leave
The New York City Department of Consumer and Worker Protection issued amended rules on May 30, 2025, formally incorporating the state prenatal leave requirement into ESSTA. Changes and obligations related to prenatal leave, which are effective July 2, 2025, include:
Policy Requirements
The obligation to promulgate and distribute a policy related to ESSTA is expanded to require that such policy address paid prenatal leave entitlements. Under the rules, employers must distribute their written safe and sick time and paid prenatal leave policies to employees personally upon hire and within 14 days of the effective date of any policy changes and upon an employee’s request.
In essence, all NYC employers have an obligation to modify their current policy and reissue the revised policy to current employees.
Employee Notice of Rights, Posting
The Department also issued an updated Notice of Employee Rights that includes paid prenatal leave. The updated notice must be provided to new hires and to current employees when rights change (which is the case here), and employers must maintain a record of receipt by the employee. The notice also must be posted.
All NYC employers have an obligation to modify the notice required for new hires and reissue the notice to current employees.
Paystub Requirement
For each pay period in which an employee uses prenatal leave, the following information must be clearly documented on pay stubs or other documentation provided to the employee, such as a pay statement:

The amount of paid prenatal leave used during the pay period; and
Total balance of remaining paid prenatal leave available for use in the 52-week period.

Under updated agency FAQs, this information can be provided by an electronic system in certain instances. This requirement is similar to the existing requirement for notice of paid sick and safe time.
NYC employers should understand their obligations and implement these changes to policies, notices, and recordkeeping.

The State of DOJ White Collar Enforcement: An Incoherent Policy Sets the DOJ on an Increasingly Clear Path

Like in all areas, the Trump Administration is bringing about great change, although the contours of the shift in white collar enforcement policy are less clear than in other places. It is clear, however, that this is an administration that will be less inclined to prosecute corruption and white collar crime. 
A recent Department of Justice memorandum setting white collar enforcement policy by Criminal Chief Matthew Galeotti provides little substance aside from setting out three core tenets—focus, fairness, and efficiency. That these feel like the product of an AI chatbot or could be found in any entry-level management course is intentional and falls in line with an administration enamored with using uncertainty. The generality of the tenets grants the President and the Attorney General ample room to bend prosecutorial discretion in whatever direction serves the moment.
The DOJ’s slow start in identifying any white collar priorities has been understandable. While on the campaign trail, the President placed immigration, transnational criminal organizations, and fentanyl at center stage, and continued to hammer these themes from Inauguration Day on. Moreover, FBI Director Kash Patel stated almost immediately after being confirmed that the agency would focus on violent crime in order to return the agency to its Prohibition-era roots. Aside from repeated promises to tackle “fraud, waste, and abuse” and a DOGE-sized detour, there has thus been little oxygen left for the traditional fraud investigation at the core of white collar enforcement. So, what do these tenets generally mean for the practice going forward? 
First, look for less complex corporate and individual prosecutions resulting in a smaller number of headline trials. This is clear from the goals Galeotti’s memorandum articulates, and also a byproduct of other trends, including an unprecedented wave of departures from the DOJ. Regardless of the underlying reasons, the loss of so many veteran prosecutors will leave a vacuum of the necessary expertise and deep institutional knowledge to navigate long-term and wide-ranging investigations. With new prosecutors being assigned mostly immigration cases out of the gate, that expertise will not return anytime soon, nor will trial teams have additional resources to rely on when most needed. For those investigations that do get off the ground, Galeotti’s memorandum urges prosecutors to act expeditiously under the guise of efficiency when making charging decisions. This will condense the timeline before a more complex case can develop organically.
On the tenet of fairness, expect generally less criminal enforcement of corporate misdeeds, especially those of a more regulatory nature. The memorandum’s language calls on prosecutors to essentially give the benefit of the doubt to corporations that are “willing to learn from their mistakes.” Whether those in the C-suite will truly be able to take the first pitch looking may depend on other factors, but it certainly dovetails with the DOJ’s early commitment to shifting traditionally criminal investigations into the civil arena, where the transactional nature will surely satisfy the President’s disposition and Congress’s desire for pro-growth policies. The DOJ has already taken this step explicitly with respect to the Foreign Corrupt Practices Act in a move that the President openly stated would “mean a lot more business for America.”
Third, as to the focus of those investigations and prosecutions prosecutors do bring, the number one area, according to the memorandum, is unsurprisingly, “waste, fraud, and abuse.” Amongst the other top priorities identified, Gaelotti notes trade and customs fraud, fraud conducted by variable interest entities, Ponzi schemes, and others directly involving U.S. investors, and fraud involving national security. As the headlines strongly indicate, criminal enforcement of immigration and matters involving the undocumented will take extreme precedence, although they typically fall outside of the realm of fraud. 
Distilling these priorities and some of the DOJ’s early moves, one can see two prominent efforts emerging from fraud prosecutors over the next year or so that fit comfortably within these three core tenets. On a more traditional front, Medicare and Medicaid fraud are very likely to continue to be a priority. Given the ballooning numbers of Americans served by these programs, the opportunity to commit fraud has risen exponentially, and thus, it is a logical area where the goals of the administration are likely to align with prosecutorial priorities. Prosecuting cases of fraud by healthcare professionals and drug distributors, especially, would serve a secondary role in defending cuts to federal healthcare spending or even shifting part of the cost burden to the states. Notably, this would continue the trend from past years as the Biden and first Trump Administration put significant resources and headlines behind these investigations. 
Second, expect to see more investigations into local governments’ use of federal funds. In the Central District of California, this has already occurred with the new U.S. Attorney’s Homelessness Fraud and Corruption Task Force, which was announced in April 2025. Tasked with determining whether federal funds have been misappropriated by the City of Los Angeles’s leaders and misused by recipients, the new task force can kill two birds with one stone by acting as a quasi-DOGE faction while also prosecuting fraud, if it is ever found. Expect more of these initiatives to be announced. Already, Chicago has seen a freeze in $1 million specifically earmarked for counter-terrorism efforts, which came on the heels of a threat to freeze all of the nearly $2.7 billion the city receives from the federal government. Such moves are a precursor to investigations and well-publicized strike forces such as the one already announced in Los Angeles.
Similarly, non-profit groups receiving federal funding should anticipate greater scrutiny, and more so when those groups’ stances run counter to the Administration’s messaging. Those skeptical that the Administration would act with this much zeal need only to look to executive orders levied against law firms, educational institutions, and even the Democrats’ major fundraising platform, ActBlue.
Of course, these trends can shift quickly. It was only two months ago that Attorney General Pam Bondi thanked Elon Musk for discovering significant levels of fraud and warned future defendants that the DOJ was “coming after you.” One notable assertion Musk made that same day was that the Small Business Association had improperly doled out $330 million in loans to minors, including a $100,000 loan to a “nine-month-old.” With the passage of time, and potentially that would-be defendant now having taken their first steps, Musk has now formally stepped back from the DOGE, and the headlines covering his allegations have quieted. Yet, at least for the time being, the inclination to repeatedly assert fraud, waste, and abuse has not lost its preeminence in government or amongst the Administration’s most fervent supporters, and it will no doubt still hold some position within the DOJ. When and if the Attorney General will bring criminal prosecutions in larger numbers is anybody’s guess, but at least we now know that as a matter of DOJ policy, the process underlying them will be focused, fair, and efficient. 

On the Menu: Florida SB 606 Serves Up More Rigid Requirements for Restaurants to Disclose Operations Charges

Takeaways

Starting 07.01.26, new disclosure requirements go into effect for restaurants that impose “operations charges.”
“Operations charges” are defined in the new law and include gratuities.
Notice requirements will affect many points of customer contact, including menus, bills, receipts, and more.

Amendments to Florida law on notification of automatic gratuity charges create more stringent requirements for how restaurants communicate operations charges to customers. Restaurant owners should review and update their policies and procedures to ensure full compliance with the new requirements.
On June 2, 2025, the governor signed Florida Senate Bill 606, making significant amendments to Section 509.214 of the Florida Statutes regarding “operations charges” in restaurants. SB 606 will go into effect on July 1, 2026.
As a restaurant owner or manager in Florida, understanding the changes to the law is crucial to ensure compliance. This article outlines key changes and what they mean for your business operations.
Background
Previous Florida law allowed restaurants to impose service charges that are not distributed to employees as tips, provided proper notice was given to customers. Early versions proposed in HB 535 would have allowed service charges only for parties of at least six, among other restrictions and requirements.
SB 606 has substantially modified those requirements, creating new obligations for restaurant owners regarding how operations charges are communicated and distributed, but it does not put in place a minimum on party size.
New Definition of “Operations Charge”
Under the amended law, an “operations charge” is defined as any additional fee or charge that a public food service establishment adds to the price of a meal that is not a government-imposed tax, including charges designated as a “service charge,” “gratuity charge,” “delivery fee,” or similar terminology.
Customer Disclosure Requirements
The amended statute requires restaurants to provide clear and conspicuous notice to customers about service charges in the following ways:

Menus, menu boards, contracts, and mobile applications or websites where orders are placed: A notice of the operations charge including the amount or percentage of the charge must appear in a font equal to or greater than the font used for menu item descriptions or contract provisions; 
Signage by the register: If no menu or menu board, contract, or table service is provided, as in a fast-food establishment, the operations charge notice must be obvious and clear on a sign by the register; 
Bills: A notice of operations charge with a clear statement of the percentage or amount of the charge must be present; and 
Receipts: Operations charges must appear on customer receipts and must be on their own lines. Gratuities and sales tax must appear on separate lines. If the operations charge includes an automatic gratuity, this must be stated.

Compliance Steps
To ensure compliance with the updated statute, restaurant owners should:

Review current operations charge practices and determine how they are being communicated and distributed; 
Update all affected materials to clearly indicate the existence of operations charges and the amount or percentage of such charges; and 
Modify point-of-sale systems to ensure receipts properly itemize and explain operations charges.

The law does not create a private cause of action related to compliance.

Is the One Big Beautiful Bill Act an Employee Benefits Crystal Ball?

Takeaways

Republicans in the U.S. House of Representatives attempt to deliver on President Trump’s campaign promises in the One Big Beautiful Bill Act (BBB or the Act), which passed the House by a razor-thin margin of 215 in favor and 214 opposed on May 22, 2025. 
BBB shows favoritism of Health Savings Accounts and Health Reimbursement Account benefits, making changes to broaden their scope, increase utilization, and bolster savings.
The Act also provides a glimpse into legislative or regulatory changes that may be on the horizon for ERISA-governed plans, including standards for Pharmacy Benefit Manager compensation, contractual requirements, and disclosures applicable to government-subsidized plans. 

The goal of the U.S. Senate is to pass One Big Beautiful Bill in a form on which Senators can agree, send it back to the U.S. House of Representatives, who then would have it on President Trump’s desk for signature by July 4, 2025. Time will tell whether this accelerated schedule is practical and what ultimately makes its way into federal law. 
Without getting too far ahead of the legislative process and certainly staying out of the weeds of the 1,038 pages of legislative proposals, the BBB reveals fringe benefit, health and welfare benefit, and executive compensation priorities. The legislation also tips the hand of the Trump Administration, shining a light on areas in which we may see additional activity. 
HSA, HRA Improvements
It is clear that House Republicans like Health Savings Accounts (HSA) and Health Reimbursement Accounts (HRA). There are pages of text aimed at expanding eligibility (including permitting Medicare-eligible enrollees to contribute to HSAs), increasing savings opportunities, allowing rollovers from other healthcare accounts, and permitting the reimbursement of qualified sports and fitness expenses. If the Act becomes law, employers offering HSA or HRA benefits will have some new bells and whistles to add to their programs.
Fringe Benefits That Make Education and Childcare More Affordable
With a focus on families and paying down student loan debt, BBB makes permanent an employer’s ability to make student loan debt repayments on a tax-favored basis under Section 127 of the tax code. BBB also enhances the employer-provided childcare tax credit, further incentivizing employers to provide childcare services to their employees. Whether the employer operates a childcare facility or pays amounts under a contract with a qualified childcare facility, BBB entices employers to add this much-needed employee benefit.
Executive Compensation Changes
The executive compensation changes baked into BBB are designed to help pay for some of the other changes. BBB expands the application of the excise tax on certain tax-exempt organizations paying compensation over $1 million (or excess parachute payments) to include former employees (think: severance). BBB also requires public companies to allocate the Internal Revenue Code Section 162(m) $1 million deduction limit among controlled group members relative to compensation when specified covered employees receive pay from those related employers. 
Tax Cuts and Jobs Act Extension
A priority of President Trump, who touted extending his tax cuts during the campaign trail, BBB extends and makes permanent the Tax Cuts and Jobs Act changes. For example, BBB permanently makes qualified moving expense reimbursements taxable.
Pharmacy Benefit Manager Regulation
BBB also includes a few surprise new twists related to Pharmacy Benefit Managers (PBM). Although the legislative reforms currently focus on Medicaid and prescription drug programs subsidized by the federal government (e.g., Medicare Part D plans, including Employer Group Waiver Plans for retirees absent a waiver), it is clear that the Trump Administration and Republicans in Congress seek transparent and fair pricing of prescription drugs. These initiatives eventually may spill over to apply to ERISA-governed plans, in furtherance of President Trump’s Executive Orders advancing Most-Favored Nation prescription drug pricing and directing increased transparency over PBM direct and indirect compensation. So, the changes are worthy of note by all employers that use PBMs. 
For Medicaid, BBB prohibits the “spread pricing” model in favor of “transparent prescription drug pass-through pricing model,” which essentially is cost-plus pricing. No more than fair market value can be paid for PBM administrative services. 
In the case of Medicare Part D plans, BBB imposes contractual requirements limiting PBM compensation to bona fide service fees. Rebates, incentives, and other price concessions all would need to be passed on to the plan sponsor. Further, the PBM would be required to define and apply in a fully transparent and consistent manner against pricing guarantees and performance measures terms such as “generic drug,” “brand name drug,” and “specialty drug.” 
Transparency also is paramount. BBB requires PBMs not only to disclose their compensation, but also their costs and any contractual arrangements with drug manufacturers for rebates, among other details.
It certainly is possible these PBM reforms are coming to an ERISA plan near you. BBB provides a roadmap for the Department of Labor’s Employee Benefits Security Administration to issue ERISA fiduciary standards, best practices, or disclosure requirements.

Recent Federal Developments for June 2025

TSCA/FIFRA/TRI
TSCA Section 21 Petition Seeks Reconsideration Of 2024 Rule Regarding Procedures For Chemical Risk Evaluation: On May 15, 2025, the Center for Environmental Accountability (CEA) filed a petition under Section 21 of TSCA requesting that the U.S. Environmental Protection Agency (EPA) reconsider the 2024 final rule regarding procedures for chemical risk evaluation under TSCA and initiate a rulemaking to amend certain provisions in 40 C.F.R. Part 702, subpart B. The petition states that EPA’s risk evaluation procedural regulations should:

Provide additional definitions for key terms, offering increased transparency and clarity regarding methods and goals of the risk evaluation process;
Bolster intra- and interagency collaboration throughout the risk evaluation process, including requirements that EPA document the outcome of those efforts;
Confirm EPA’s authority to determine which conditions of use (COU) fall within the scope of a risk evaluation;
Explain the criteria EPA may use in determining the COUs it expects to consider;
Provide for a de minimis level below which EPA may exclude COUs from the scope of the risk evaluation;
Explicitly require consideration of existing regulations administered by EPA and other agencies when determining exposure estimates for each COU for a chemical substance;
Require that any assumptions, uncertainty factors, models, and/or screening approaches used in the risk evaluation reasonably reflect the COUs of the chemical substance in practice;
Require EPA to make an unreasonable risk determination for each COU of a chemical substance assessed in a risk evaluation;
Clarify when determinations regarding unreasonable risk or no unreasonable risk are considered final agency actions;
Explicitly require peer review for all risk evaluations;
Create a clear regulatory pathway for the development and submission of draft risk evaluations by requesting manufacturers and other interested persons; and
Extend applicable comment periods and include opportunities for further extensions.

Chemical Coalition Withdraws TSCA Section 21 Petition Seeking Revisions To TSCA Section 8(a)(7) PFAS Reporting Rule: As reported in our May 4, 2025, blog item, on May 2, 2025, a coalition of chemical companies petitioned EPA for an amendment of the TSCA Section 8(a)(7) rule requiring reporting for per- and polyfluoroalkyl substances (PFAS). The petitioners ask that EPA revise the reporting rule to exclude imported articles, research and development (R&D) materials, impurities, byproducts, non-isolated intermediates, and PFAS manufactured in quantities of less than 2,500 pounds (lb.). According to a May 22, 2025, letter from EPA, on May 16, 2025, the coalition withdrew its petition via e-mail to EPA Administrator Lee Zeldin and “EPA now considers this petition closed.” After the coalition submitted its petition, EPA published an interim final rule to postpone the data submission period to April 13, 2026, through October 13, 2026. 90 Fed. Reg. 20236. Small manufacturers reporting exclusively as article importers would have until April 13, 2027, to report. Comments on the interim final rule were due June 12, 2025. 
EPA Proposes To Extend Certain Compliance Deadlines To Ensure Lab Compliance With Final Methylene Chloride Risk Management Rule: On May 27, 2025, EPA proposed to extend certain compliance dates in the final risk management rule for methylene chloride under TSCA. 90 Fed. Reg. 22214. The proposed rule would extend the Workplace Chemical Protection Program (WCPP) compliance dates for non-federal laboratories by an additional 18 months to align with the dates allowed for federal laboratories and their contractors. If issued in final, the rule would extend the following compliance dates for non-federal laboratories: for initial monitoring from May 5, 2025, to November 9, 2026; for establishing regulated areas and ensuring compliance with the Existing Chemical Exposure Limit (ECEL) from August 1, 2025, to February 8, 2027; and for ensuring the methods of compliance as well as developing and implementing an exposure control plan from October 30, 2025, to May 10, 2027. Comments are due June 26, 2025.
DOD RFI Seeks Information On Certain Chemicals Undergoing TSCA Section 6 Risk Evaluation: On May 27, 2025, the U.S. Department of Defense (DOD) issued a request for information (RFI) to gather information to identify and assess critical applications for DOD and the defense industrial base (DIB) that necessitate the use of existing chemicals undergoing EPA’s TSCA Section 6 risk evaluation process. The RFI states that it will help the Office of the Assistant Secretary of Defense for Energy, Installations, and Environment (OASD (EI&E)) Chemical and Material Risk Management Program (CMRMP) better understand the use of TSCA existing chemicals in products leading into the defense supply chain. The RFI is focused on receiving information related to the following existing chemicals:

1,3-Butadiene (Chemical Abstracts Service Registry Number® (CAS RN®)106-99-0);
1,1-Dichloroethane (CAS RN 75-34-3);
1,2-Dichloroethane (CAS RN 107-06-2);
Butyl benzyl phthalate (1,2-benzene-dicarboxylic acid, 1-butyl 2(phenylmethyl) ester) (BBP) (CAS RN 85-68-7);
Dibutyl phthalate (1,2-benzene- dicarboxylic acid, 1,2- dibutyl ester) (DBP) (CAS RN 84-74-2);
Dicyclohexyl phthalate (DCHP) (CAS RN 84-61-7);
Di-ethylhexyl phthalate (1,2-benzene-dicarboxylic acid, 1,2-bis(2-ethylhexyl) ester) (DEHP) (CAS RN 117-81-7);
Di-isobutyl phthalate (1,2-benzene-dicarboxylic acid, 1,2-bis-(2methylpropyl) ester) (DIBP) (CAS RN 84-69-5);
Di-isodecyl phthalate (1,2-benzenedicarboxylic acid, 1,2-diisodecyl ester) (DIDP) (CAS RNs 26761-40-0; 68515-49-1);
Diisononyl phthalate (1,2-benzenedicarboxylic acid, 1,2-diisononyl ester) (DINP) (CAS RNs 28553-12-0; 68515-48-0); and
Octamethylcyclotetra-siloxane (D4) (CAS RN 556-67-2).

DOD seeks to understand better applications that require the use of these chemicals and the criticality of these chemicals for industry and supply. The RFI notes that DOD will continue to issue RFIs to consider additional TSCA chemicals. Responses are due June 20, 2025.
ACC Files TSCA Section 21 Petition Seeking Reconsideration Of TCE Risk Management Rule: On May 27, 2025, the American Chemistry Council (ACC) petitioned EPA under TSCA Section 21 for reconsideration of the final risk management rule for trichloroethylene (TCE). ACC requests that EPA reconsider and amend two provisions of the rule:

Revise the byproduct exclusion in 40 C.F.R. Section 751.301(c) by removing the “site-limited” restriction that requires byproduct TCE to be reused as a “part of the same overall manufacturing process.” The petition states that this would allow facilities to continue reusing/processing byproduct TCE either at the same facility where the byproduct was generated or at another facility; and
Delete the last sentence from the “regulatory threshold” provision in 40 C.F.R. Section 751.301(b), allowing facilities to continue discharging wastewater that contains TCE at less than 0.1 percent by weight pursuant to their valid, existing Clean Water Act (CWA) National Pollutant Discharge Elimination System (NPDES) permits.

Draft Risk Evaluations Determine That DBP And DEHP Present Unreasonable Risks To Human Health And The Environment: On June 5, 2025, EPA announced the release of the draft TSCA risk evaluations for DBP and DEHP. 90 Fed. Reg. 23931. EPA states that it used the best available science to prepare the draft risk evaluations and to determine preliminarily, based on the weight of scientific evidence, that DBP and DEHP present unreasonable risk to health and the environment driven primarily by certain COUs analyzed in the draft evaluations. Comments on the draft risk evaluations are due August 4, 2025. The Science Advisory Committee on Chemicals (SACC) will peer review the documents at a meeting on August 4-8, 2025. Comments submitted by July 21, 2025, will be considered by SACC during its peer review meeting. More information will be available in a forthcoming memorandum.
EPA Extends Deadline To Report Health And Safety Data For 16 Chemicals: EPA issued a final rule on June 9, 2025, that extends the reporting deadlines for a rule under TSCA Section 8(d) requiring manufacturers (including importers) of 16 chemicals to report data from unpublished health and safety studies to EPA. 90 Fed. Reg. 24228. EPA notes that these health and safety studies “will help inform EPA’s prioritization, risk evaluation, and risk management of chemicals under TSCA. ” The reporting deadline in EPA’s December 13, 2024, final rule was March 13, 2025. In March 2025, EPA extended the reporting deadline to June 11, 2025, for vinyl chloride and to September 9, 2025, for the other chemicals covered under the rule. The rule extends the reporting deadlines for all 16 chemicals to May 22, 2026. According to EPA, the extension will provide it additional time to prepare final guidance for companies on issues related to complying with the rule, including those related to templates required for submissions containing confidential business information. The chemicals subject to the TSCA Section 8(d) rule are:  

Acetaldehyde;
Acrylonitrile;
2-anilino-5-[(4-methylpentan-2-yl) amino]cyclohexa-2,5-diene-1,4-dione (6PPD-quinone);
Benzenamine;
Benzene;
Bisphenol A (BPA);
Ethylbenzene;
Hydrogen fluoride;
4,4-Methylene bis(2-chloraniline) (MBOCA);
N-(1,3-Dimethylbutyl)-N′-phenyl-p-phenylenediamine (6PPD);
Naphthalene;
Styrene;
4-tert-octylphenol(4-(1,1,3,3-Tetramethylbutyl)-phenol);
Tribromomethane (bromoform);
Triglycidyl isocyanurate; and
Vinyl chloride.

More information on EPA’s December 2024 rule is available in our December 23, 2024, memorandum.
EPA Issues Final SNURs For Certain Chemicals: EPA issued final significant use rules (SNUR) on June 13, 2025, for certain chemical substances that were the subject of premanufacture notices (PMN) and are also subject to an Order issued by EPA pursuant to TSCA. 90 Fed. Reg. 24977. The SNURs require persons to notify EPA at least 90 days before commencing the manufacture (including import) or processing of any of these chemical substances for an activity that is designated as a significant new use in the SNUR. In addition, the manufacture or processing for the significant new use may not commence until EPA has conducted a review of the required notification; made an appropriate determination regarding that notification; and taken such actions as required by that determination. The final SNURs are effective August 12, 2025.
RCRA/CERCLA/CWA/CAA/PHMSA/SDWA
CEQ Withdraws NEPA Interim Guidance On Consideration Of Greenhouse Gas Emissions And Climate Change: On May 28, 2025, the Council on Environmental Quality (CEQ) announced the withdrawal of its interim guidance entitled “National Environmental Policy Act Guidance on Consideration of Greenhouse Gas Emissions and Climate Change,” for which notice was published in the Federal Register on January 9, 2023. 90 Fed. Reg. 22472. According to CEQ, it has concluded that the interim guidance is inconsistent with the policy objectives in Executive Order (EO) 14154, Unleashing American Energy. The withdrawal was effective May 28, 2025.
PHMSA Seeks Stakeholder Feedback On Whether To Amend Or Repeal Hazardous Materials Rulemaking Procedures, Program Procedures, Or Regulations: On June 4, 2025, the Pipeline and Hazardous Materials Safety Administration (PHMSA) published an advance notice of proposed rulemaking (ANPRM) to solicit stakeholder feedback on whether to repeal or amend any requirements in the Hazardous Materials Rulemaking Procedures and Program Procedures or the Hazardous Materials Regulations (HMR), as well as any letters of interpretation, guidance documents, or other material, “to eliminate undue burdens on the identification, development, and use of domestic energy resources and to improve government efficiency.” 90 Fed. Reg. 23656. PHMSA states that it seeks stakeholder feedback regarding opportunities to identify widely used hazardous material special permits with established safety records for conversion into deregulatory provisions with broader applicability. PHMSA also seeks stakeholder feedback regarding opportunities to introduce efficiencies to its petitions process. Finally, PHMSA also solicits stakeholder feedback on whether to amend the HMR to require PHMSA to conduct periodic, mandatory regulatory reviews. Comments are due August 4, 2025. PHMSA notes that it will consider late-filed comments to the extent practicable.
FDA
FDA Advances Post-Market Chemical Review Program: On May 15, 2025, the U.S. Food and Drug Administration (FDA) announced the launch of “a stronger, more systematic review process for food chemicals already on the market — especially those that concern consumers most.” Over the coming months, FDA will roll out the following key actions:

A modernized, evidence-based prioritization scheme for reviewing existing chemicals. According to FDA, it will soon release a draft for public comment;
A final, systematic post-market review process shaped by stakeholder input. More information on FDA’s 2024 Discussion Paper Development of an Enhanced Systematic Process for the FDA’s Post-Market Assessment of Chemicals in Food is available in our August 22, 2024, blog item; and
An updated list of chemicals under review, including butylated hydroxytoluene (BHT); butylated hydroxyanisole (BHA); and azodicarbonamide (ADA). FDA states that it will also take steps to expedite its review of chemicals currently under review like phthalates, propylparaben, and titanium dioxide. FDA notes that it will continue to share information about the status of its work on its public website as part of its push for greater transparency.

FDA notes that until now, it has conducted post-market reviews “on a case-by-case basis, often in response to citizen petitions or new scientific evidence.” FDA states that the new framework “will be proactive, science-based, and built for long-term impact.”
NANOTECHNOLOGY
NASEM Releases Quadrennial Review Of NNI, Recommends Renewed And Expanded Infrastructure: On May 20, 2025, the National Academies of Sciences, Engineering, and Medicine (NASEM) announced the release of a report entitled Quadrennial Review of the National Nanotechnology Initiative (2025): Securing U.S. Global Leadership Through Renewed and Expanded Infrastructure. Requested by Congress as part of the 21st Century Nanotechnology Research and Development Act, the report focuses on the infrastructure of the National Nanotechnology Initiative (NNI). The Committee on the Quadrennial Review of the NNI “recommends a new focus on renewing and expanding the nanotechnology infrastructure, including instruments, facilities, and people, so that the intellectual capital of nanotechnology can be converted into economic, social, and national security gains for the United States.” More information is available in our May 23, 2025, blog item.
PUBLIC POLICY AND REGULATION
When States Step In: PFAS Policy Innovation Or Fragmentation?: While federal regulators continue to lay the groundwork for a comprehensive response, including through the PFAS Strategic Roadmap, states are increasingly positioning themselves as policy innovators in this space. The recent announcement that EPA will issue additional guidance and extend the compliance deadline for the TSCA Section 8(a)(7) PFAS reporting rule underscores a broader dynamic: in the absence of fast-moving federal action that states perceive as comprehensive, states are setting the pace, even if their approaches do not always (or ever) mirror the federal approach to regulation and risk mitigation. While this federal delay, and retreat in other PFAS areas, is recent, states have not waited for federal action. Over the past few years, several states have increasingly framed PFAS regulation as a space for environmental leadership, and their regulatory approaches diverge significantly from federal approaches to PFAS regulation. 
Congress And The Feds — The Impact Of Nonperformance: Ponder the following existential question: Who does their job less effectively? Members of Congress or employees of federal agencies? Congress has not been able to reauthorize environmental statutes for years, with some (most) needing significant attention. Many of the “problems” often cited by critics of Agency behavior can be traced back to the fact that demands to fix current problems are being made of a program that does not quite fit the text of the authorizing statute. To address action demanded by state and federal legislative members, the bureaucracy has to rely on fitting the law they implement to often unforeseen problems that they now confront.
Many observers fear the fallout of the demise of the Chevron doctrine — concern that, without deference to agency interpretations, important problems may remain unaddressed (or worse, for some, resolution may fall to federal judges). But consistent with the court opinion, interpretations of legislative text is the domain of judges or, heaven forfend, the responsibility of Congress to define or refine clearly the extent and intent of the legislation.
The current result to fill effectively the legislative effort can be called “rubber-suiting” — stretching the colorable authority already granted to address a new problem not originally anticipated by the legislative authors. An example in the environmental space is the EPA authority to regulate biotechnology products: TSCA and FIFRA can reach (stretch) to cover most of the waterfront about regulatory issues identified needing regulation.
Over the past decades, Congress and different administrations have made intermittent attempts to craft a new, broad, and modern statute to coordinate and regulate government review and approval of biotechnology products. The current government allocation of responsibilities across agencies, reliant on authority legislated mostly long before biotechnology products were developed, is governed by policies first crafted during the Reagan and H.W. Bush Administrations.
Jurisdiction remains fragmented, relying on statutes drafted before modern methods of biotech engineering were even developed, and holes in the rubber-suit remain. In addition to the jurisdictional difficulties and holes, especially acute in the last decade or three, is the bitter partisanship besetting congressional deliberation. There are continued calls for “regular order,” but apparently little appetite for the same. “Regular order” would see legislation introduced, deliberated by the assigned subcommittee(s) and committee(s), moving to floor consideration in each chamber, and differences between House and Senate resolved by a conference committee. Such a schematic is about as currently relevant as having new members watch Jimmy Stewart’s Mr. Smith Goes to Washington as part of orientation.
Our April 2, 2025, blog post discussed how the call to reorganize EPA has been a long-standing idea to “reform” the Agency to better achieve its mission. Likewise, the point here is to suggest that Congress might benefit from a version of “doctor, heal thyself” should any serious attempt be made to make government work better, be more efficient, and give more meaning to the phrase “your tax dollars at work.” More information is available in our May 21, 2025, blog item.
Chemical Policy Crossroads: MAHA Report’s Assessment Calls For Reform Amid Deregulatory Trends: In response to President Trump’s February 13, 2025, EO 14212, “Establishing The President’s Make America Healthy Again Commission,” the White House issued part of what is being called “The MAHA Report” (with MAHA an acronym for Make America Healthy Again), entitled “Make Our Children Healthy Again: Assessment” (the Assessment), on May 22, 2025. Section One of the Assessment, “The Shift to Ultra-Processed Foods,” includes the Commission’s thoughts on the U.S. agricultural system, food additives, food industry regulation, and government food programs, while Section Two of the Assessment, “The Cumulative Load of Chemicals in our Environment,” includes its take on chemical exposures and pathways, corporate influence, and highlights some top concerns. The Assessment’s core messages add yet another element of business uncertainty that chemical stakeholders would be wise to note. For our thoughts on the Assessment, please read our June 2, 2025, blog. More information on the Assessment is also available in our June 11, 2025, blog item.
Big Beautiful Bill Means Big Cuts For Clean Energy Manufacturers: On March 20, 2025, House Republicans passed the “Big Beautiful Bill” (BBB) as part of H.R. 1, a sweeping legislative package that includes dramatic rollbacks of many of the clean energy tax credits established under the Inflation Reduction Act (IRA). While the bill has little chance of advancing in the Senate in its current form, its proposed cuts offer a window into shifting political priorities and could have significant implications for the U.S. clean energy manufacturing sector. Subtitle C of the bill, titled “Make America Win Again,” proposes to sunset, repeal, or restrict nearly every major clean energy tax credit under the IRA. Among those affected are credits for clean vehicle purchases (Section 25E), commercial clean vehicles (Section 45W), alternative refueling infrastructure (Section 30C), residential energy efficiency improvements (Sections 25C and 25D), new energy efficient homes (Section 45L), and advanced manufacturing (Section 45X).
For manufacturers, the most potentially damaging proposals are those that target the clean electricity production and investment credits under Sections 45Y and 48E, and the advanced manufacturing production credit under Section 45X. The bill would not only accelerate the phase-out dates for these credits but would also impose new restrictions on facilities and companies that receive any form of “material assistance” from so-called “prohibited foreign entities,” including entities with even minor Chinese ownership or influence. In addition to severing incentives for manufacturers with foreign ties, the BBB repeals the ability to transfer clean energy tax credits under IRA Section 6418 — a key tool for helping smaller developers and manufacturers monetize credits and attract financing.
Although the BBB is unlikely to become law in its current form, its provisions could resurface in future negotiations or budget bills. Industry participants should monitor legislative developments closely and consider how foreign ownership structures, supply chain dependencies, and tax credit planning may need to adapt to an evolving policy landscape. More information is available in our June 6, 2025, blog item.
Clearing Regulatory Roadblocks: How Smarter Implementation Can Help Supply Chain Modernization: On June 5, 2025, the Joint Economic Committee (JEC) of the U.S. Congress convened a hearing titled “Barriers to Supply Chain Modernization and Factor Productivity Enhancements.” Throughout the hearing, members and witnesses alike underscored the role of “regulatory friction” — especially in the form of fragmented and unpredictable requirements — as a key factor slowing investment in domestic manufacturing and threatening supply chain resilience. While EPA and TSCA were not named directly, the concerns raised map closely onto the compliance challenges companies face under TSCA Section 5 and Section 6 and related programs.
The JEC hearing makes clear that regulatory clarity and coordination are essential to rebuilding a productive and resilient industrial base. Even without mentioning TSCA by name, the hearing highlighted the very pressures companies face under EPA’s chemical management programs: unclear compliance standards, disconnected data requests, and prolonged uncertainty about new product approval despite considerable capital investment and unclear future legal obligations.
EPA has opportunities to reduce these pressures. Codifying frequently referenced guidance through notice-and-comment rulemaking, aligning reporting obligations across programs, and engaging earlier with agencies like DOD and the U.S. Department of Commerce could provide the predictability and coordination manufacturers need to invest confidently in modernization. To the extent of trying “new ideas” or probing varied regulatory options, a pilot program could reward those who might be willing to volunteer if such program participation provided an interim safe harbor of sought-after certainty while emerging rules and definitions are further clarified. More information on the issues discussed at the hearing is available in our June 13, 2025, blog item.
LEGISLATIVE
Bipartisan VET PFAS Act Would Support Veterans Exposed To PFAS: Representatives Mike Lawler (R-NY) and Josh Riley (D-NY) introduced the VET PFAS Act (H.R. 3639) on May 19, 2025. According to Lawler’s May 29, 2025, press release, the bipartisan legislation would ensure veterans and their families exposed to PFAS at military installations receive the health care and disability benefits they have earned through the Department of Veterans Affairs (VA). The bill would:

Designate PFAS exposure as a service-connected condition for affected veterans;
Require the VA to provide health care and benefits for medical conditions associated with PFAS exposure; and
Ensure military families have access to the care and support they need.

Bipartisan Plant Biostimulant Act Would Advance Agricultural Innovation: On May 22, 2025, Senators Roger Marshall, M.D. (R-KS) and Alex Padilla (D-CA) introduced the Plant Biostimulant Act (S. 1907) to establish a standardized process for approving the commercial use of plant biostimulants as alternatives to synthetic pesticides and fertilizers. Marshall’s May 30, 2025, press release states that plant biostimulants “have demonstrated potential in advancing sustainable practices, including carbon sequestration and water quality enhancement.” According to the press release, the bill would also support research into the benefits of these technologies for soil health.
Bipartisan Bill Would Streamline FDA Review Of Nonprescription Sunscreens: On June 3, 2025, the Co-Chairs of the Congressional Skin Cancer Caucus, Representatives John Joyce, M.D. (R-PA), Debbie Dingell (D-MI), Dave Joyce (R-OH), and Deborah Ross (D-NC), introduced the Supporting Accessible, Flexible, and Effective (SAFE) Sunscreen Standards Act (H.R. 3686) to streamline the FDA review process of the effectiveness and safety of new ingredients for nonprescription sunscreens. According to Dave Joyce’s June 4, 2025, press release, the bill would:

Improve regulatory standards:
 

Directs FDA to establish clearer, more flexible standards for evaluating sunscreen ingredients;
 
Allows the use of real-world evidence, observational studies, and nontraditional scientific data to determine safety and effectiveness; and
 
Incorporates non-animal testing alternatives to align with modern research practices and ethical standards;
 

Requires FDA to update its final administrative order on pending sunscreen ingredients to:
 

Consider historical data on ingredients already used safely in the United States;
 
Reinforce that sunscreen is a proven cancer prevention tool; and
 
Use the new evidence and testing standards established in the bill; and
 

Increase transparency and reporting by requiring the Secretary of Health and Human Services to submit annual reports to Congress detailing:
 

Progress on implementing new standards;
 
How many applications were reviewed under the new process; and
 
FDA’s use of non-animal testing methods.

Bipartisan Legislation Would “Deliver Justice For PFAS-Impacted Families”: On June 5, 2025, Representatives Brian Fitzpatrick (R-PA) and Kristen McDonald Rivet (D-MI), Co-Chairs of the Congressional PFAS Task Force, introduced bipartisan legislation (H.R. 3761) to ensure greater transparency and accountability from DOD for communities impacted by widespread PFAS contamination. According to Fitzpatrick’s June 5, 2025, press release, the bill would establish a new high-level position at the Pentagon — Coordinator for PFAS-Impacted Defense Engagement — “to serve as a direct advocate for affected families, improve transparency, drive remediation, and ensure the government delivers answers, not delays.” The PFAS coordinator would be responsible for:

Engaging directly with affected communities to address concerns, ensure accountability, and provide updates on remediation efforts;
Streamlining communication between local stakeholders, advocacy organizations, and federal agencies; and
Driving progress on cleanup efforts with transparency and urgency.

MISCELLANEOUS 
Petitions Filed To Add Chemicals To List Of Chemical Substances Subject To Superfund Excise Tax: On May 21, 2025, the Internal Revenue Service (IRS) announced that petitions have been filed to add the following chemicals to the list of taxable substances:

Ethylene propylene diene (EPDM) rubber (90 Fed. Reg. 21825): Petition filed by Exxon Mobil Corporation, an exporter of EPDM rubber;
Neo decanoic acid (90 Fed. Reg. 21824): Petition filed by Exxon Mobil Corporation, an exporter of neo decanoic acid;
Nonene (90 Fed. Reg. 21826): Petition filed by Exxon Mobil Corporation, an exporter of nonene;
Tridecyl alcohol (90 Fed. Reg. 21824): Petition filed by Exxon Mobil Corporation, an exporter of tridecyl alcohol; and
Tri-isononyl tri-mellitate (90 Fed. Reg. 21827): Petition filed by Exxon Mobil Corporation, an exporter of tri-isononyl tri-mellitate.

Comments on the petitions are due July 21, 2025.
Minnesota Extends Public Comment Period On Proposed PFAS Reporting Rule As Entities Voice Concerns About Compliance With Deadlines And Due Diligence Standards: On May 22, 2025, the Minnesota Pollution Control Agency (MPCA) held a public hearing on its “Proposed Permanent Rules Relating to PFAS in Products; Reporting and Fees” (proposed rule). Administrative Law Judge (ALJ) Jim Mortenson facilitated the hearing, which had more than 100 participants in attendance. MPCA has made available online the PowerPoint document used for the hearing presentation, the hearing exhibits, and a transcript of the hearing. The pre-hearing public comment period for the proposed rule closed on May 21, 2025. Under Minnesota administrative procedure, comments must be accepted for five days following a hearing on a proposed rule, and the overseeing ALJ may extend the comment period by no more than 20 days. Following the close of comments and a brief rebuttal period, the presiding ALJ will issue a report on the proposed rule within 30 days, unless an extension is granted. The post-hearing comment period for the proposed rule has been extended until 4:30 p.m. (CDT) on June 23, 2025. A rebuttal period of five business days, lasting from the close of the public comment period until 4:30 p.m. (CDT) on June 30, 2025, will follow. Persons may respond to public comments during this rebuttal period, but they may not submit new comments. Any person who wishes to comment on the rule or provide rebuttal may do so via e-comments, mail, or fax. MPCA will not accept comments submitted via e-mail. Comments must be received by MPCA by the end of the respective periods, so persons planning to submit comments or rebuttals via mail should ensure comments are sent with enough time to reach MPCA by the cutoff. More information on the public hearing is available in our May 29, 2025, memorandum.
President Signs EO To Restore Gold Standard For Science, Calls For Reevaluation Of Biden Administration’s Scientific Integrity Policies: On May 27, 2025, President Trump signed an EO on “Restoring Gold Standard Science.” 90 Fed. Reg. 22601. The EO states that the Trump Administration “is committed to restoring a gold standard for science to ensure that federally funded research is transparent, rigorous, and impactful, and that Federal decisions are informed by the most credible, reliable, and impartial scientific evidence available.” The EO restores the scientific integrity policies of the first Trump Administration and “ensures that agencies practice data transparency, acknowledge relevant scientific uncertainties, are transparent about the assumptions and likelihood of scenarios used, approach scientific findings objectively, and communicate scientific data accurately.” The EO directs the Director of the White House Office of Science and Technology Policy (OSTP), in consultation with the heads of relevant agencies, to issue guidance within 30 days for agencies on implementing “Gold Standard Science” in the conduct and management of their respective scientific activities. The EO defines Gold Standard Science as science conducted in a manner that is reproducible; transparent; communicative of error and uncertainty; collaborative and interdisciplinary; skeptical of its findings and assumptions; structured for falsifiability of hypotheses; subject to unbiased peer review; accepting of negative results as positive outcomes; and without conflicts of interest. Once OSTP publishes the guidance, the EO directs each agency head to update promptly applicable agency policies governing the production and use of scientific information, including scientific integrity policies, to implement the OSTP Director’s guidance. Within 60 days of the publication of OSTP’s guidance, agency heads must report to the OSTP Director on the actions taken to implement Gold Standard Science at their agency. More information on restoring the Gold Standard for Science is available in our June 5, 2025, memorandum.
EPA Publishes FY 2026 Budget In Brief: On May 30, 2025, EPA published its FY 2026 Budget in Brief. President Trump requested $4.16 billion for EPA for fiscal year (FY) 2026, a 54 percent decrease from the FY 2025 enacted budget level. According to EPA, the budget request supports 12,856 full-time equivalents (FTE), a decrease of 1,274 FTEs from the 2025 level, aligning with the President’s goal of streamlining the federal workforce. EPA states that it “is focused on a back-to-basics approach that will lower the cost of living, remove unnecessary barriers for business and industry, empower states, and return the Agency to administering core statutory obligations as Congress intended.” EPA notes that it is currently developing the FY 2026-2030 EPA Strategic Plan and states that the FY 2026 Budget will advance the EPA Administrator’s five strategic pillars: Clean Air, Land, and Water for Every American; Restore American Energy Dominance; Engage in Permitting Reform, Cooperative Federalism, and Cross-Agency Partnership; Develop Artificial Intelligence (AI) Capabilities; and Protect American Auto Jobs.
NTP Updates Report On Carcinogens Handbook On Methods For Conducting Cancer Hazard Evaluations: On June 2, 2025, the National Toxicology Program (NTP) announced the availability of The Report on Carcinogens Handbook on Methods Conducting Cancer Hazard Evaluations. An update to the 2015 version, it provides methods for conducting a robust and transparent evaluation to determine whether a substance is a cancer hazard. The topics covered include: developing and planning the evaluation framework; human exposure data evaluation; human cancer studies evaluation; experimental animal cancer studies evaluation; disposition and toxicokinetic data evaluation; mechanistic data evaluation; and evidence integration and cancer hazard conclusion.
AMS Conducting Referendum To Determine Whether To Continue Regulations Regarding National Paper And Paper-Based Packaging Research And Promotion Program: On June 3, 2025, the U.S. Department of Agriculture’s (USDA) Agricultural Marketing Service (AMS) published a notice of referendum on the Paper and Paper-Based Packaging Promotion, Research and Information Order. 90 Fed. Reg. 23421. This document directs that a referendum be conducted among eligible domestic manufacturers and importers of paper and paper-based packaging to determine whether they favor continuance of AMS’s regulations regarding a national paper and paper-based packaging research and promotion program. AMS also announced an immediate moratorium on the collection of assessments under the program. The referendum will be conducted by express mail and electronic ballot from July 14, 2025, through July 25, 2025. Ballots delivered to AMS via express mail or electronic ballot must show proof of delivery by no later than 11:59 p.m. (EDT) on July 25, 2025. Eligible persons will receive a ballot through mail and may cast a ballot through express mail or electronic ballot. Each person who is an eligible domestic manufacturer or importer at the time of the referendum and during the representative period from January 1, 2024, through December 31, 2024, shall be entitled to cast a ballot in the referendum.
WDOE Proposes To Regulate PFAS In Certain Consumer Products: The Washington Department of Ecology (WDOE) issued a proposed rule on June 4, 2025, that would regulate PFAS in certain consumer products. Beginning January 1, 2027, the proposed rule would prohibit the intentional use of PFAS in:

Apparel and accessories;
Automotive washes; and
Cleaning products.

Under the proposed rule, manufacturers would be required to report by January 31, 2027, intentionally added PFAS in the following products manufactured on or after January 1, 2026:

Apparel for extreme and extended use;
Footwear;
Gear for recreation and travel;
Automotive waxes;
Cookware and kitchen supplies;
Firefighting personal protective equipment (PPE);
Floor waxes and polishes;
Hard surface sealers; and
Ski waxes.

Annual reports would be due thereafter. WDOE will hold online hearings on July 9 and July 10, 2025. Comments on the following draft documents are due July 20, 2025:

Proposed rule: Includes draft restrictions and reporting requirements on intentionally added PFAS in 12 product categories. This rulemaking focuses on requirements related to PFAS in 12 new product categories;
Preliminary Regulatory Analyses: Explains the potential costs and benefits of the proposed rule; and
Draft State Environmental Policy Act (SEPA) Determination of Non-Significance and Environmental Checklist: Describes potential environmental benefits of the proposed rule.

WDOE will review comments, consider revisions to the proposed rule and other rulemaking documents, and respond to comments. WDOE states that it expects to decide on rule adoption in November 2025.
ACGIH Updates Documentation; Second Comment Period Will Begin July 1, 2025: The American Conference of Governmental Industrial Hygienists (ACGIH®) announced on June 12, 2025, that the first half of the Threshold Limit Value (TLV®) Development Process for 2025 has ended. Updated documentation is now available on ACGIH’s website through Data Hub and for purchase as PDFs in ACGIH’s Publications Store. ACGIH has posted the updated list of Notices of Intended Changes (NIC) and adopted substances. ACGIH notes that the second comment period will open July 1, 2025. ACGIH encourages further comment for the second half of the year. Comments are due September 30, 2025, with ratification occurring in November 2025, and updates in December 2025.
CPSC Publishes RFI On Reducing Regulatory Burdens: The U.S. Consumer Product Safety Commission (CPSC) published an RFI on June 12, 2025, seeking public comment on opportunities for CPSC to reduce burdens and costs of its existing rules, regulations, or practices without impacting safety. 90 Fed. Reg. 24791. According to CPSC, “[r]egulations and other practices that do not reasonably advance safety, but instead promote unscientific ideological agendas, create unnecessary burdens and costs, restrict consumer choice, or reduce competition, entrepreneurship, and innovation — and thereby restrain the American economy — should generally be eliminated or modified.” Comments are due August 11, 2025.
President’s FY 2026 Budget Requests Would Eliminate CSB, Reorganize CPSC: President Trump’s FY 2026 budget request for the Chemical Safety and Hazard Investigation Board (CSB) states that the President’s budget proposes to eliminate funding for CSB as part of the Trump Administration’s plans “to move the Nation towards fiscal responsibility and to redefine the proper role of the Federal Government.” The President’s budget request proposes $0 for CSB in FY 2026 with the expectation that CSB begin closing down during FY 2025. CSB’s emergency fund of $844,145 will be appropriated to cover costs associated with closing down the agency.
President Trump’s FY 2026 budget request for CPSC proposes to reorganize and transfer the functions of CPSC to the U.S. Department of Health and Human Services (HHS) Office of the Secretary as the Assistant Secretary for Consumer Product Safety (ASCPS). The budget request states that “[u]ntil the enactment of authorizing legislation to reorganize, the CPSC will continue to carry out its mission to protect the public from unreasonable risks of injury from consumer products as a standalone agency.” Under the budget request, the ASCPS would receive $135 million, $15.975 million below the FY 2025 enacted budget, to support 459 FTEs and operational costs, a reduction of 75 FTEs from the FY 2025 enacted budget. More information is available in our June 5, 2025, blog item.

Oregon Imposes Limitations on Restrictive Covenants in Agreements With Healthcare Practitioners

On June 9, 2025, Oregon Governor Tina Kotek signed into law Senate Bill (SB) 951, which, among other things, will impose significant new limitations on restrictive covenants with healthcare practitioners relating to noncompetition, nondisparagement, and nondisclosure. The limitations may soon be modified by separate legislation, House Bill (HB) 3410.

Quick Hits

With some exceptions, Oregon’s SB 951 renders “void and unenforceable” noncompetition agreements with “medical licensees,” i.e., Oregon-licensed physicians, nurse practitioners, physician associates, and practitioners of naturopathic medicine.
The law also renders “void and unenforceable” certain kinds of nondisparagement and nondisclosure agreements between medical licensees and management services organizations, hospitals, or hospital-affiliated entities.
The new limitations currently apply prospectively and void noncompliant agreements entered into or renewed on or after the law takes effect. HB 3410, if passed, will apply new limitations on noncompetition agreements retroactively.
The law provides anti-retaliation protections to medical licensees who violate otherwise valid nondisclosure or nondisparagement agreements or who disclose or report information that a licensee believes in good faith violates a law, rule, or regulation.

Limitations on Noncompetition Agreements With Medical Licensees
SB 951 renders void and unenforceable noncompetition agreements with medical licensees that are entered into on or after the passage of the law, with some exceptions. If HB 3410 becomes law, however, SB 951 will be given retroactive effect as to noncompetition agreements. The law will render void and unenforceable noncompetition agreements with medical licensees that are entered into before, on, or after the passage of the law.
A “medical licensee” includes an individual licensed in Oregon to practice medicine or naturopathic medicine, or an individual licensed as a nurse practitioner or physician associate.
SB 951 defines a “noncompetition agreement” as “a written agreement between a medical licensee and another person under which the medical licensee agrees that the medical licensee, either alone or as an employee, associate or affiliate of a third person, will not compete with the other person in providing products, processes or services that are similar to the other person’s products, processes or services for a period of time or within a specified geographic area after termination of employment or termination of a contract under which the medical licensee supplied goods to or performed services for the other person.”
The limitation on noncompetition agreements broadly applies to agreements between medical licensees and any person, management services organization, hospital, or hospital-affiliated clinics.
A “management services organization” in this context is defined as “an entity that under a written agreement, and in return for monetary compensation” provides “management services”—i.e., “ services for or on behalf of a professional medical entity”—including payroll, human resources, employment screening, employee relations, or any other administrative or business services that support or enable the entity’s medical purpose but that do not constitute the practice of medicine; the enabling of physicians, physician associates, and nurse practitioners to jointly render professional healthcare services; or the practice of naturopathic medicine.
The law provides exceptions to the prohibition on noncompetition agreements with medical licensees. In all cases, a noncompetition agreement must comply with Oregon’s general limitations on such agreements between employers and employees set out in ORS 653.295. The exceptions may be revised if HB 3410 passes the legislature and the bill is signed into law by the governor.
In both SB 951 and HB 3410, noncompetition agreements with medical licensees will be permitted where the medical licensee has a minimum ownership or membership interest in the other party to the agreement; where “the medical licensee does not engage directly in providing medical services, health care services or clinical care”; or where the professional medical entity provides the medical licensee with documentation of a “protectable interest” (SB 951) or a “recruitment investment” (HB 3410), defined as costs to the professional medical entity equivalent to at least 20 percent of the annual salary of the medical licensee that are incurred for (a) “marketing to and recruiting the licensee”; (b) “providing the licensee with a sign-on or relocation bonus”; (c) “educating or training the licensee in the entity’s procedures”; (d) providing the licensee with “support staff, technology acquisitions or upgrades and license fees related to the employee’s employment”; or (e) “similar or related items.” In some circumstances, both measures place limits on the length of time a noncompetition agreement can remain in effect.
Limitations on Nondisclosure and Nondisparagement Agreements With Medical Licensees
In addition to its limitations on noncompetition agreements, SB 951 also limits nondisclosure and nondisparagement agreements between medical licensees and management services organizations, or between medical licensees and hospitals or hospital-affiliated entities, if the licensee is an employee of the hospital or hospital-affiliated entity. These limitations apply to agreements entered into on or after the date of the law’s passage. There are also some important exceptions.
Nondisclosure Agreements
SB 951 defines a “nondisclosure agreement” as any written agreement that restricts a medical licensee from disclosing (a) a policy or practice that the licensee was required to use in patient care other than individually identifiable health information protected from disclosure under the Health Insurance Portability and Accountability Act of 1996 (HIPAA); (b) a policy, practice, or other information about or associated with the licensee’s employment, conditions of employment, or rate or amount of pay or other compensation; or (c) any other information the licensee possesses or to which the licensee has access by reason of the licensee’s employment by, or provision of services for or on behalf of, the other party to the agreement.
Nondisparagement Agreements
SB 951 defines a “nondisparagement agreement” as any written agreement that requires a medical licensee to “refrain from making to a third party a statement about another party to the agreement or about another person specified in the agreement as a third-party beneficiary of the agreement, the effect of which causes or threatens to cause harm to the other party’s or person’s reputation, business relations or other economic interests.”
Exceptions to the Limitations on Nondisclosure and Nondisparagement Agreements
The limitations on nondisclosure and nondisparagement agreements expressly do not apply to information subject to protection by applicable trade secret law or to information that is proprietary to the other party or other third-party beneficiary of the agreement. The limitations also do not apply to statements by medical licensees that constitute actionable libel, slander, tortious interference with contractual relations, or other established tort, so long as a claim against the medical licensee does not depend upon or derive from a breach or violation of the agreement.
The new law also permits a nondisclosure or nondisparagement agreement with a medical licensee under the following two circumstances:

The medical licensee’s employment with the other party has terminated, voluntarily or involuntarily, and the licensee is not restricted from making a good faith report of information that the licensee believes is evidence of a violation of a law, rule, or regulation to a hospital, hospital-affiliated clinic, or state or federal authority.
The nondisclosure or nondisparagement agreement is part of a negotiated settlement between the medical licensee and the other party.

Antiretaliation Protections
The new law prohibits a management services organization or a professional medical entity from taking an “adverse action” against a medical licensee in retaliation for, or as a consequence of, the licensee’s violation of a nondisclosure or nondisparagement agreement or because the licensee in good faith disclosed or reported information that the licensee believed was a violation of law, rule, or regulation to the management services organization, a hospital, a hospital-affiliated clinic, or a state or federal authority.
An “adverse action” is broadly defined to include “discipline, discrimination, dismissal, demotion, transfer, reassignment, supervisory reprimand, warning of possible dismissal or withholding of work, even if the action does not affect or will not affect a medical licensee’s compensation.”
Next Steps
With SB 951, Oregon joins other states, such as Colorado, Wyoming, Pennsylvania, Louisiana, Maryland, and Connecticut, that are considering or have taken steps to significantly limit or prohibit restrictive covenants with healthcare practitioners.
In light of the changes, employers of healthcare practitioners in Oregon may want to consider reviewing and revising their employment contracts and evaluating alternative strategies for protecting their business interests.

Indiana Adds More Restrictions on Physician Noncompete Agreements

Last month we reported on physician and healthcare noncompete laws enacted in 2025. Shortly after the article was posted, another state joined the ranks: Indiana. 
Indiana recently enacted Senate Enrolled Act No. 475 (the “Act”), which amended Indiana’s preexisting physician noncompete statute. The amendment prohibits certain physicians from entering noncompete agreements with hospitals, parent companies of hospitals, affiliated managers of hospitals, or hospital systems. The Act is Indiana’s third law restricting physician noncompetes, building upon existing legislation passed in 2020 and 2023.
Backdrop: Indiana’s 2020 and 2023 Physician Noncompete Restrictions
In 2020, Indiana took its first step toward restricting physician noncompete agreements with the passage of Indiana Code section 25-22.5-5.5. Under the 2020 law, a physician noncompete agreement is only enforceable if it satisfies certain requirements, such as ensuring patient notification of the physician’s contact information, ensuring the physicians’ access to medical records, and giving the physician the option to purchase a release from the terms of the noncompete covenant at a “reasonable price.”
In May 2023, Indiana took a second step toward restricting physician noncompete agreements with the passage of Senate Enrolled Act No. 7 (“SEA 7”). Most notably, SEA 7 prohibits noncompete agreements between an employer and a primary care physician. SEA 7 also renders noncompete agreements with all other types of physicians unenforceable where (1) the employer terminates the physician’s employment without cause, (2) the physician terminates their employment for cause, or (3) the physician’s employment contract expires, and the physician and employer have fulfilled their obligations under the employment contract. SEA 7 also clarified the “reasonable price” buyout provision in the 2020 law by specifying a process for negotiating a reasonable buyout price.
Senate Enrolled Act No. 475
This year, on May 6, 2025, Governor Mike Braun signed into law Senate Enrolled Act No. 475. Effective July 1, 2025, the Act prohibits noncompete agreements between a physician and a hospital, parent company of a hospital, affiliated manager of a hospital, or hospital system. The Act does not repeal, replace, or reduce any aspect of the 2020 or 2023 laws. It only applies to agreements entered into on or after July 1, 2025.
The Act defines a “noncompete” as any contract or contractual provision that restricts or penalizes a physician’s ability to practice medicine in any geographic area for any period of time after a physician’s employment ends. The Act provides further illustration: the definition explicitly includes restrictive covenants that impose financial penalties or repayment obligations pursuant to practicing medicine with a new employer, provisions requiring employer consent to practice medicine with a new employer, and provisions that impose indirect restrictions that limit or deter a physician from practicing medicine with a new employer.
The Act does not apply to:

Agreements in the sale-of-business context where the physician owns more than 50% of the business entity at the time of sale;
Nondisclosure agreements protecting confidential business information and trade secrets; or
Non-solicitation agreements, so long as the non-solicitation agreement only lasts for a one-year term post-employment and does not restrict patient interactions, patient referrals, clinical collaboration, or a physician’s professional relationships.

Importantly, the Act’s definition of “hospital” does not include freestanding health facilities, rural emergency hospitals, and institutions specifically intended to diagnose and treat mental illness and developmental disabilities. 
In light of these new restrictions, employers expecting to enter noncompete agreements with physicians in Indiana should work with counsel to make sure their agreements meet these new standards.