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Bruce Ewing litigates trademark, copyright, and licensing disputes for brand owners and creative industry clients so they can protect what they've built and keep their businesses moving forward.

With more than 30 years focused on intellectual property litigation, Bruce brings deep courtroom and arbitration experience to clients facing high-stakes trademark and copyright disputes. Bruce represents companies of all sizes — from global brands to independent producers — in federal court, before the Trademark Trial and Appeal Board (TTAB), and in arbitration proceedings, pursuing and defending claims for trademark infringement, trade dress infringement, trademark counterfeiting, trademark dilution, cybersquatting, copyright infringement, and false advertising.

A significant part of Bruce's practice centers on commercial disputes with an intellectual property dimension, particularly licensing matters. He has represented suppliers, manufacturers, and licensees in the apparel, accessories, and jewelry industries, as well as theatrical producers, publishers, and entertainment figures, in cases involving breach of contract, fraud, tortious interference, and related claims.

His arbitration work is substantial: Bruce has served as an arbitrator on the Commercial and Consumer Arbitration Panels of the American Arbitration Association (AAA) in multiple proceedings involving intellectual property and commercial disputes.

Beyond the courtroom, Bruce counsels clients on trademark and copyright registration, licensing strategy, and the preparation of rules for contests and sweepstakes. His practice spans the full lifecycle of an intellectual property asset — from registration through enforcement and, when necessary, litigation.

Bruce previously served as head of the Trial Department in Dorsey & Whitney's New York office and as Co-Chair of the Firm's Intellectual Property Litigation practice group.

Select Experience

  • Ultra Records, Inc. v. Ultra International Music Publishing, LLC, 22-cv-9667 (AS), 2025 U.S. Dist. LEXIS 33338 (S.D.N.Y. Feb. 25, 2025): Obtained plaintiff's verdict on claims for trademark infringement, unfair competition, and dilution after a six-day jury trial and subsequent bench proceeding; secured permanent injunction enjoining future use of the ULTRA trademark.
  • GlaxoSmithKline LLC et al. v. Laclede, Inc., 18 Civ. 4945 (JMF) (S.D.N.Y. 2019): Obtained preliminary injunction against ongoing use of confusingly similar advertising and promotional materials for competing dry mouth products.
  • Kumar v. Instituteof Electrical and Electronics Engineers, Inc., 12 Civ. 06870 (KSH)(CLW) (D.N.J. 2016): Obtained defense verdict for a scientific publisher after a seven-day jury trial on a copyright infringement claim involving a doctoral thesis and journal article concerning robotics.
  • JA Men's Group LLC v. JA Apparel Corp. (AAA 2015): Secured and collected an award of $42.6 million in a trademark licensing dispute before the American Arbitration Association.

Education

  • Columbia Law School (J.D., 1992)
  • Brown University (B.A., 1988)

Bar Admissions

  • New Jersey
  • New York

Professional Affiliations

  • Chair, INTA International Amicus Committee, 2006-2007
  • Vice Chair, INTA International Amicus Committee, 2004-2005
  • Member, INTA Select Committee on the Federal Trademark Dilution Act, 2003
  • Panel Member, American Arbitration Association, 2024-2026

AAA Panel member 2025

Court Admissions

  • U.S. Supreme Court
  • U.S. Court of Appeals for the Second, Fourth, Ninth, Tenth, and Federal Circuits
  • U.S. District Courts for the Southern, Eastern, Northern, and Western Districts of New York, the District of New Jersey, and the Eastern and Western Districts of Michigan

Accolades

  • Chambers USA, Intellectual Property: Trademark, Copyright & Trade Secrets, New York, 2010-2026
  • Best Lawyers in America®, 2005-2027
  • New York Metro Super Lawyers®, 2006-2026
  • IAM/WTR Copyright 1000, “World's Leading Copyright Professionals," 2026
  • Managing IP, IP STAR, 2019-2026
  • World Trademark Review 1000, "The World’s Leading Trademark Professionals," Leading Practitioner, 2013-2026

Select Presentations

  • Speaker, Practicing Law Institute, “Understanding the Intellectual Property License,” New York, New York, 2012-2017; Chair 2018-2023

Insights

Blog Post

Second Circuit Calls Foul On Unauthorized Use of Michael Jordan Video

April 30, 2026

Blog Post

I Don’t Get You, Babe – The Curious Copyright Case of Sonny & Cher & Mary

June 6, 2024

  The 1970s were the heyday of the now-extinct television genre known as the variety show: a weekly extravaganza headlined by a well-known entertainer, generally accompanied by a supporting cast of singers, dancers and comedians, and featuring a weekly guest star to liven things up. Among the longest lasting of these weekly spectacles was The Sonny & Cher Comedy Hour, which premiered in 1971 and featured the eponymous 1960s singing duo. Sonny (born Salvatore Bono) and Cher (nee Cherilyn Sarkisian) met in 1962, when Cher, then 16 and a recent high school dropout, approached Sonny, then an up-and-coming songwriter, about breaking into the music business. Sonny helped Cher become a backup singer on many recordings helmed by legendary music producer (and later convicted murderer) Phil Spector, before transitioning to a lead performer with Sonny, performing as Sonny & Cher. The pair, by now dating and sharing a great mutual Love and Understanding, scored multiple hits in the 1960s, including their signature song I Got You Babe, and others like Bang Bang (My Baby Shot Me Down) and Baby Don’t Go, mostly written or co-written by Sonny, who had also written hits for a number of other artists. In 1971, the pair agreed to star in a variety show that would also help transition Cher to a successful solo career; she would top the charts in the early 70s with hits like Gypsies, Tramps and Thieves and Half Breed. The Sonny & Cher Comedy Hour featured lavish production numbers; bigtime guests like Carol Burnett, George Burns, Ronald Reagan, The Jackson 5, and Burt Reynolds; daring Bob Mackie gowns; and caustic banter between the two stars (mostly about Sonny’s short stature). For a time, the show was a hit, and it ran for three successful seasons. Unfortunately, The Sonny & Cher Comedy Hour came to an unfortunate end, coinciding with the end of the Sonny & Cher marriage. The couple had wed in 1969 after the birth of their only child, now known as Chaz Bono; Sonny had a daughter, Christine, by an earlier marriage. But enterprising television executives were not going to let a pesky divorce get in the way of a solid ratings hit. CBS simply rebranded its program as The Cher Show and the Beat Went On as if Sonny had never been a part of the program. For his part, Sonny nabbed his own show on ABC, The Sonny Comedy Revue, which was a ratings flop. And The Cher Show was not all that successful either – the American public wanted Sonny & Cher together, and that is what they got in 1976, when Sonny & Cher reunited for the third iteration of their CBS show, The Sonny & Cher Show. Unfortunately, the now divorced couple could not recapture the magic of the original program, for cutting quips about the loving foibles of a happily married couple now came across as (and up to a point, were) bitter putdowns of estranged exes. This third and last iteration of their show marked the end of the Sonny & Cher entertainment partnership. The two never performed again together except for a 1987 appearance on The David Letterman Show. Time went on. Cher Found Someone, remarrying (briefly) the rock star Greg Allman, and she had another child with him. She also rebuilt her successful solo music career, then transitioned to acting and scored multiple Oscar nominations, winning for Moonstruck in 1988. Her music career has been even more long-lasting, with one hit song after another running into the 2000s. For his part, Sonny pursued a reasonably successful acting career and likewise remarried, to Mary Whitaker, in 1986. The couple had two children of their own, Chesare and Chianna, while Sonny was transitioning to a most unexpected new career: politician. Sonny was elected Mayor of Palm Springs in 1988, and then was elected to the U.S. House of Representatives in 1994. But, sadly, Sonny was killed in a skiing accident in 1998. At his widow Mary’s request, Cher gave one of the principal eulogies at his funeral, delivering one of the most moving, heartfelt tributes you will ever hear. In his honor, the 1998 revision to the US Copyright Act was named the Sonny Bono Copyright Term Extension Act. It is the events after Sonny’s death that give rise to this blog post. For all of his many music, business and political accomplishments, Sonny botched his estate planning: there was none – he died without a will (oy!). Mary, who had succeeded Sonny in Congress, serving until 2013, was appointed administrator of his estate. Among the estate’s creditors was Cher, who asserted her rights under an August 10, 1978 Marriage Settlement Agreement (the “MSA”). The MSA was meant to resolve all of the financial aspects of the Sonny & Cher divorce, and consistent with California’s community property laws, it granted Cher “an undivided 50% interest” in two revenue sources. The first was record royalties – royalties payable to performers when physical or digital copies of the recordings on which they sang are sold or downloaded – payable to Sonny under various recording contracts he entered into between 1964 (when he started dating Cher) and 1971. The second were composition royalties – royalties payable to songwriters whenever their compositions are recorded, played, performed, streamed, or licensed. Composition royalties tend to be more lucrative (depending on the popularity of the song) than record royalties. Mary, as estate administrator, recognized Cher’s rights to these royalties under the MSA, and Cher received her percentages of both royalties for nearly two decades after Sonny’s death. Cher and Mary also cooperated, per the MSA, in agreeing to the appointment of an administrator to collect and disburse both types of royalties. That administrator was entitled to receive 10% of both types of royalties under the MSA in consideration for their work. The apparently harmonious relationship between Cher and Mary began to hit the skids in 2016, when Mary invoked Section 304(c) of the US Copyright Act. That provision of the statute authorizes a copyright owner or grantor (if they are living), or their statutory heirs (if they are not) to terminate prior copyright grants or licenses for works created before January 1, 1978 in certain circumstances, and on particular timetables, by sending a notice of termination to the grantees/licensees. By sending such a notice, the copyright owner or their heirs can recapture their rights and, potentially, monetize their copyrighted works on more favorable terms. Mary sent such termination notices to a number of music publishers, specifying effective termination dates between 2018 and 2026. Cher was not told about the issuance of these termination notices, nor were the MSA and the Sonny & Cher recording contracts mentioned in the notices. But in 2021, Cher learned not only that Mary had ceased paying her composition royalties, as the prior grants from Sonny to various music publishers began to terminate, but that Mary was taking the position that the MSA no longer applied, at least as to composition royalties, and that Cher would also cease to receive Sonny’s share of record royalties when/if Mary chose to terminate the 1964-71 recording contracts and renegotiate them. Cher could not Believe that Mary was taking such a position, accused Mary of being a Dark Lady, and claimed Mary was trying to Turn Back Time to the period before the Sonny & Cher divorce. Cher therefore sued Mary in the U.S. District Court for the Central District of California, accusing Mary of breaching the MSA and seeking a declaratory judgment that the MSA’s obligations remained binding, termination notices or not. For her part, Mary lodged counterclaims against Cher for breach of the MSA because Cher had refused to consent to the continued appointment of the royalty administrator, and had objected to Mary’s plan to create a new royalty administration entity that she and Sonny’s four children would own. (Mary had Sat Down With the Kids, including Chaz, and apparently worked this out.) Mary also wanted the Court to declare that Mary could negate Cher’s interest in the Sonny & Cher recording contracts if Mary chose to terminate and renegotiate them. One added wrinkle to this case: after it was filed, in January 2023, Cher sold all of her rights in her song catalog, including her rights in the MSA, to an unnamed third party for an unknown amount of money. Last week, after several years of litigation in which both sides were presumably on Needles and Pins, the Court resolved the dispute by largely siding with Cher. It rejected Mary’s argument that the termination/recapture provisions of Section 304(c) relieved Mary of her obligations under the MSA, largely for two reasons. First, the MSA was not a copyright grant that could be terminated under the statute, but a contract dividing revenue between Sonny & Cher. In other words, Sonny did not grant Cher an interest in his copyrights, but simply agreed to divide with her the revenue produced by those copyrights. Because there was no grant of any copyright interests to Cher, there was nothing Section 304(c) could terminate. Second, Section 304(c) authorizes termination of “the exclusive or nonexclusive grant of a transfer or license of the renewal copyright or any right under it, executed before January 1, 1978.” The MSA was executed on August 10, 1978, and the Court rejected Mary’s argument that it was the date of Sonny’s prior grants that mattered, as opposed to the MSA’s execution date. Mary did score a partial victory on the royalty-administrator issue, as the Court found that Mary had sole discretion to select the royalty administrator, even one she created, but Cher could object to the terms of the appointment, including on things like fees and the administrator’s qualifications. So is this the final chapter of the Sonny & Cher business partnership? Not yet – Cher’s 2023 sale of her interest in the MSA left the Court uncertain about who should be paid certain royalties accruing during the pendency of the lawsuit – Cher or her anonymous buyer. So that issue remains to be resolved, meaning that, for now, Cher & Mary will have to continue Living in a House Divided, until the case is finally resolved.

Firm Highlights

Insights

EPA Limits Title V Re-Litigation of NSR Permits

Overview On September 25, 2026, the U.S. Environmental Protection Agency (“EPA”) published a final rule that significantly limits the ability of third parties to use the Clean Air Act (“CAA”) Title V permitting process to revisit New Source Review (“NSR”) permitting decisions years after those decisions were made. The rule establishes that NSR permitting determinations generally must be challenged during the original permitting proceeding, thereby providing regulated sources with greater permitting certainty and finality for major capital projects. Published in the Federal Register titled Clarifying the Scope of “Applicable Requirements” Under State Operating Permit Programs and the Federal Operating Permit Program (Docket ID No. EPA-HQ-OAR-2023-0401), the rule amends 40 C.F.R. Parts 70 and 71 to codify EPA’s interpretation regarding when requirements established under other CAA programs may be reviewed, modified, or implemented through the Title V operating permit program. The rule becomes effective 30 days after publication. The rule addresses two principal issues: (1) the relationship between NSR preconstruction permitting and Title V operating permits, and (2) the treatment of the General Duty Clause under CAA section 112(r)(1). Most significantly, the rule provides greater certainty for sources navigating the NSR permitting process. EPA’s amendments are intended to ensure that NSR permitting decisions made through an approved public process are generally not revisited later through Title V permit proceedings. The rule responds to a circuit split between the U.S. Courts of Appeals for the Fifth and Tenth Circuits. In Environmental Integrity Project v. EPA, 969 F.3d 529 (5th Cir. 2020), the Fifth Circuit upheld EPA’s interpretation, concluding that it was consistent with the text, structure, and purpose of Title V. In contrast, the Tenth Circuit reached the opposite conclusion in Sierra Club v. EPA, 964 F.3d 882 (10th Cir. 2020), finding that the then-existing regulatory definition of “applicable requirement” did not support EPA’s position. By amending the regulatory language on which the Tenth Circuit relied and codifying the interpretation approved by the Fifth Circuit, EPA has established a nationwide framework governing the interaction between NSR and Title V. NSR and Title V: EPA Establishes a Uniform Nationwide Framework At the core of the rule is EPA’s effort to define the respective roles of NSR and Title V. The rule codifies the approach EPA has applied since 2017: once a source obtains an NSR permit under an EPA-approved permitting program, and that permit was issued following public notice with an opportunity for comment and judicial review, the permit establishes the NSR-related “applicable requirements” of the State Implementation Plan (“SIP”) or Federal Implementation Plan (“FIP”) for Title V purposes. Under this framework, Title V is not a vehicle for re-examining underlying NSR permitting decisions. EPA does not intend to use the Title V process to revisit applicability determinations, emissions calculations, control technology determinations, permit conditions, or other issues resolved through the NSR permitting process. This principle applies regardless of the stage of the Title V proceeding; whether the NSR permit was issued pursuant to a SIP or FIP; the type of NSR issue involved; or whether the NSR permit is incorporated into Title V sequentially or concurrently. Limited Exceptions EPA recognizes several circumstances in which NSR issues may still be reviewed through the Title V program: No NSR permit was issued at all; The permit was issued without public notice and an opportunity for comment and judicial review; or The issue involves substantive overlap between Title V and NSR requirements, such as the adequacy of monitoring provisions. As a result, the rule does not insulate unpermitted projects or foreclose review of matters that independently arise under Title V. Key Regulatory Amendments The rule revises the definition of “applicable requirement” in 40 C.F.R. §§ 70.2 and 71.2. Paragraph (1): Where an NSR permit is issued with public notice and an opportunity for comment and judicial review, the permit establishes and defines the applicable SIP or FIP requirements for Title V purposes. Paragraph (2): All NSR permit terms, including terms contained in minor NSR permits, constitute applicable requirements that must be incorporated into Title V permits. Paragraph (4): CAA section 112(r)(1) (the General Duty Clause) is expressly excluded from the definition of “applicable requirement,” while section 112(r)(7) Risk Management Program requirements remain included. EPA also amended 40 C.F.R. §§ 70.8 and 70.12 to clarify that alleged defects in requirements established outside the Title V process generally do not provide a basis for EPA objection to a Title V permit or for a Title V citizen petition. General Duty Clause Exclusion The rule also codifies EPA’s longstanding position that the General Duty Clause in CAA section 112(r)(1) is not an “applicable requirement” for Title V purposes. EPA points to several considerations supporting that conclusion, including the distinction between the General Duty Clause and Title V permit terms, the provision’s origins in the Occupational Safety and Health Act’s general duty clause, and the different enforcement structures applicable to the General Duty Clause and Title V permit requirements. Importantly, excluding section 112(r)(1) from the definition of “applicable requirement” does not eliminate EPA’s authority to enforce the General Duty Clause independently of the Title V program. The final rule instead clarifies that the General Duty Clause need not—and should not—be incorporated into Title V permits as an applicable requirement. Practical Implications for Regulated Sources Greater Finality for NSR Permits  For projects requiring PSD, nonattainment NSR, or minor NSR permits, the permitting process becomes the primary forum for resolving disputes regarding applicability determinations, emissions calculations, control technology requirements, offsets, and permit conditions. Once an NSR permit is issued through a qualifying public process, regulated sources should face substantially reduced risk that those same issues will be challenged years later through Title V permit proceedings. Reduced Risk of Collateral Permit Challenges Stakeholders have sometimes sought to use Title V permit issuance, renewal, revision, or citizen-petition proceedings to challenge underlying NSR determinations. The final rule makes clear that Title V is not the appropriate vehicle for challenging whether an applicable requirement was correctly established in the first instance. This should reduce the risk of permit delays and uncertainty associated with collateral challenges to previously issued NSR permits. The rule does not, however, eliminate all Title V challenges relating to an NSR permit. Challenges concerning the Title V permit itself—including whether it appropriately incorporates applicable requirements or contains adequate compliance provisions—remain possible. Increased Importance of the Initial NSR Proceeding Because Title V generally will not provide a second opportunity to challenge the substantive validity of an NSR determination, the administrative record developed during the NSR process becomes increasingly important. Permit applicants should ensure that applicability analyses, emissions calculations, control technology evaluations, modeling demonstrations, and supporting technical documentation are thoroughly developed during the original permitting proceeding. For significant projects, applicants may therefore have an additional incentive to identify and resolve potential permitting issues before the NSR permit is issued rather than assuming that unresolved issues can be addressed during a subsequent Title V proceeding. Potential Incentive for Broader Public Participation EPA also notes that permitting authorities may choose to provide public notice and an opportunity for comment for a broader range of NSR permits because permits issued through a qualifying public process receive the benefit of the finality framework established by the rule. Some permitting authorities may conclude that greater public participation at the NSR stage is preferable to uncertainty during subsequent Title V proceedings. Conclusion The final rule is principally a permitting-certainty measure. For sources that obtain NSR permits through a public process, EPA has substantially limited the ability of third parties to revisit underlying NSR determinations through the Title V program. As a result, regulated entities should benefit from greater finality regarding key permitting decisions, reduced risk of collateral permit challenges, and increased certainty when planning and implementing capital projects.

Insights

Energy Law: Month in Review - September 2026

Welcome to Dorsey’s Energy Law: Month in Review. We provide this update to our clients to identify significant developments in the previous month. Please reach out to any of the authors, listed above, to discuss these issues. Regulatory Developments Massachusetts Ratchets Up State and Local Regulation of AI Data Centers In early September, Governor Maura Healey of Massachusetts signed an executive order requiring that artificial intelligence data centers secure the approval of local communities as a precondition to proceeding with a given project. According to the terms of the order, data center developers will need to secure a “community benefits agreement” as a precondition to receiving permits from numerous state agencies, including the Department of Environmental Protection, the Energy Facilities Siting Board, and the Massachusetts Environmental Policy Act Office. Beyond requiring community benefits agreements, the order also mandates that developers mitigate utility costs to consumers, prohibits the use of nondisclosure agreements, and requires various state agencies to develop measures to limit data center impacts on the environment. North Carolina Regulators Decline Approval of Duke Energy Gas Turbine On September 18, 2026, North Carolina Utilities Commission (NCUC) denied Duke Energy’s application for a certificate of public convenience and necessity required to construct a gas-fueled combustion turbine at its Smith Energy Complex in North Carolina. The NCUC objected strongly to the $584 million price tag and noted that Duke appeared to be constructing the facility “based on anticipated data center customer additions.” The NCUC rejected that anticipated growth as “insufficiently reliable for the Commission to act at this point.” In rejecting Duke’s application, the NCUC also noted that Duke had signed the White House Ratepayer Protection Pledge, in which it represented that it would not shift data center costs to consumers. The NCUC observed that the record did not demonstrate how Duke “intends to adhere to its commitments under the Ratepayer Protection Pledge with regard to the Proposed Facility.” Notably, commission staff had actually supported the construction of the turbine, citing concerns about Duke’s reserve margins. The NCUC noted that it “understands the Public Staff’s expressed concerns,” but those concerns were outweighed by the NCUC’s reservations, including questions of demand. Department of Energy Approves Funds for Grid Improvement The U.S. Department of Energy (DOE) recently announced that it would fund 31 grid-improvement projects in 26 states. The funding initiative is part of the DOE’s “SPARK” initiative. The funding will include $1.9 billion in federal funding from DOE and $3.35 billion in recipient cost-sharing funding. The funds will go to projects designed to improve grid reliability and lower electricity costs. Recipients plan to reconductor over 1,500 miles of transmission lines and will deploy grid-enhancing technologies across approximately 21,000 miles. DOE stated that this initiative will make available over 23 additional gigawatts of electricity. Texas Moderates Rules Governing Data Center Interconnection The Texas Public Utility Commission adopted new regulations governing large-load interconnections. The rules impose a flat study fee of $100,000 for all proposed interconnections, which departs from the initial proposal to impose study fees using a tiered system based on project size. Additionally, the final rule eliminates the PUC’s previous proposal to impose a non-refundable interconnection fee of $50,000 per MW of contracted peak demand. The final rule also moderates the initially proposed regulations governing Electric Reliability Council of Texas (ERCOT) notifications for large-load customers’ non-utilized capacity. The proposed rules would have required notifying ERCOT within 30 days of missing a scheduled energization milestone by six months. The final rules, however, do not require informing ERCOT unless a scheduled energization milestone is missed by 24 months. FERC Denies TransAlta 202(c) Cost-Recovery Plan The Federal Energy Regulatory Commission (FERC) recently rejected TransAlta’s plan to recover $19.9 million in expenses stemming from a DOE order in which DOE prohibited TransAlta from retiring its coal-powered Centralia power plant. TransAlta had previously intended to retire the facility at the end of 2025. TransAlta’s cost recovery plan proposed spending an additional $23 million on repairs to continue operating the unit. FERC’s main objection had to do with geographic scope. TransAlta’s recovery plan called for recovering costs from California Independent System Operator (CAISO) and the Southwest Power Pool (SPP), but the DOE’s order requiring operation of the plant was designed to ensure reliability in the Northwest assessment area (Montana, Oregon, Washington, and parts of northern California and northern Idaho). Accordingly, FERC was unwilling to allow cost recovery from CAISO and SPP when the order that precipitated the additional costs only related to the Northwest assessment area. FERC informed TransAlta that it would only approve cost recovery from load-serving entities in the Northwest assessment area. FERC’s decision comes amid a rush of DOE emergency orders requiring the continued operation of coal-fired generating units. Litigation Appeals Court Upholds Washington Hydropower Plant With Caveats In a September 21, 2026, opinion, the Washington Court of Appeals largely upheld a Clean Water Act water quality certification by the Washington Department of Ecology for the Goldendale Energy Storage Project, a proposed pumped-water storage hydropower system adjacent to, but off-stream from, the Columbia River. A nonprofit (Columbia Riverkeeper) and the Confederated Tribes and Bands of the Yakama Nation appealed the certification, contending that it failed to impose necessary conditions and monitoring requirements to protect the water quality of the Columbia River. Most saliently, the plaintiffs argued that the project had the potential to leak 100 acre-feet of water per year into tributaries of the Columbia River. The Court of Appeals broadly rejected plaintiffs’ challenge to the state’s conclusion that “the project was designed not to leak.” That said, the Court of Appeals did reverse on one narrow issue. Specifically, the court determined that the state’s conclusion that “leakage from the project’s tunnels would be monitored and reported” was not supported by the evidence because the certification “does not explicitly require monitoring and reporting to determine whether there is any leakage.” Accordingly, the court remanded the matter to the state to impose monitoring and reporting requirements but otherwise affirmed the certification. Legislative Developments California Legislates Restrictions on Data Center Energy Use and Grid Costs On September 21, 2026, California Governor Gavin Newsom signed seven bills broadly regulating data centers in the state. SB 1168 directed the California Public Utilities Commission to assess the energy used by data centers. It also requires the PUC to pass costs of transmission and distribution upgrades and load increases on to data centers, rather than customers. SB 886 and SB 887 compel data centers to pay for infrastructure upgrade and generation costs, and wildfire mitigation costs, in addition to imposing environmental review. The statutes additionally increase local oversight of data centers. AB 1577 imposes a monthly reporting requirement that requires data centers to supply energy consumption and efficiency data to the California Energy Commission. AB 2383 contains incentives for data centers to use onsite clean energy generation. Finally, AB 2469 and AB 2619 require data center developments to assess water supply and develop a water scarcity plan. The statutes also mandate statewide water reporting as a precondition to obtaining and renewing business licenses.

Insights

SEC Proposes Expansion of Investment Adviser Performance-Based Compensation Rule

On September 30, 2026, the Securities and Exchange Commission (the “SEC”) proposed amendments to Rule 205-3 under the Investment Advisers Act of 1940, as amended (the “Advisers Act”), which provides an exemption from the general prohibition under Section 205(a)(1) of the Advisers Act on registered investment advisers receiving performance-based compensation (the “Proposal”) so long as performance-based compensation is limited to “qualified clients”.1 Most notably for private fund sponsors, the Proposal would expand the definition of “qualified client” to include any investors that satisfy the “accredited investor” definition under Regulation D. The Proposal may also have implications for private fund managers that rely on exemptions from investment adviser registration under state law because certain state-level investment adviser registration exemptions incorporate or otherwise reference the federal qualified client definition. Expansion of the Qualified Client Definition Under the current Rule 205-3, an investor generally may qualify as a qualified client if, among other alternatives, the investor has at least $1.4 million under management with the adviser or has a net worth exceeding $2.7 million. These thresholds are higher than the financial thresholds applicable to many accredited investors under Regulation D. As a result, an investor may currently qualify as an accredited investor for purposes of investing in a private offering without qualifying as a qualified client for purposes of paying performance-based compensation. The Proposal would expand the qualified client definition to include any natural person or legal entity investor that satisfies the accredited investor definition under Regulation D. The Proposal would also remove the assets under management and net worth thresholds under the current Rule 205-3 qualified client test. For private funds relying on Section 3(c)(1) of the Investment Company Act of 1940, this change could reduce the need to apply a separate qualified client standard to investors that already qualify as accredited investors. Dorsey Observations and Next Steps If adopted as proposed, the expanded qualified client definition could be particularly significant for private fund managers. Most private fund offerings are already limited to accredited investors under Regulation D. However, the Proposal could expand the pool of prospective investors available to emerging private fund managers while reducing the regulatory burden associated with complying with Rule 205-3. The Proposal could also benefit advisers operating below the SEC registration threshold that rely on a state private fund adviser exemption. A number of states have adopted exemptions modeled on the North American Securities Administrators Association (“NASAA”) private fund adviser exemption, which may condition relief for advisers to certain funds relying on Section 3(c)(1) on each beneficial owner satisfying the federal qualified client definition. However, state requirements vary, and any effect of the Proposal would depend on the text of the applicable state exemption and how it incorporates Rule 205-3. Many emerging private fund managers may have a larger network of accredited investor relationships than qualified client relationships during the early stages of their investment advisory business. Currently, under Rule 205-3, private fund managers may receive performance-based compensation from investors who do not satisfy the qualified client definition if those investors were admitted to their private funds prior to registration with the SEC. Following registration with the SEC, however, managers may continue to permit investors that are not qualified clients to invest in future private funds but may not receive performance-based compensation from those investors with respect to such investments. In addition, because the net worth and assets under management thresholds for qualified client status are adjusted for inflation every five years, the pool of qualified client investors may diminish over time as previously eligible investors no longer satisfy the applicable thresholds. The Proposal could provide the dual benefit of greater flexibility for private fund managers to establish and maintain relationships with accredited investors as their businesses scale and they become registered with the SEC, and greater flexibility for certain accredited investors to participate in investment strategies that historically have been restricted to much larger institutional investors. Unless and until the Proposal is adopted, investment advisers should continue to comply with the existing qualified client requirements. If the Proposal is adopted, private fund sponsors should consider whether corresponding changes are appropriate for their subscription documents, investor questionnaires, and other offering materials. Advisers that are state-registered or rely on a state-level exemption should also consult the laws and regulations of each relevant jurisdiction before changing investor eligibility standards or performance-based compensation practices, because adoption of the federal amendments may not automatically modify state requirements. Comments on the Proposal will be due 60 days after publication in the Federal Register. 1 Investment Adviser Performance-Based Compensation Modernization, Investment Advisers Act Release No. IA-7022 (Sept. 30, 2026), available at https://www.sec.gov/rules-regulations/2026/09/s7-2026-28#33-11443proposed.

Insights

The Supreme Court Update - October 8, 2026

On September 29, 2026, the Supreme Court granted certiorari in one case: Department of Homeland Security v. D.V.D., No. 26-426: This case concerns the Trump Administration’s “third-country removal” procedures, where immigrants are deported to countries not listed in the removal orders. In granting certiorari, the Court granted the Government’s application to stay a lower court decision halting the practice, which will allow third-country removals to continue pending resolution of the case. The issues presented are: (1) Whether the district court had jurisdiction over respondents’ claims; (2) whether the district court had authority to enter class-wide declaratory relief and APA vacatur under 8 U.S.C. § 1252(f)(1); (3) whether the Government’s guidance on third-country removals is unlawful under 8 U.S.C. § 1231(b), the due process clause, or FARRA/CAT and its implementing regulations; and (4) such other questions that the Government determines are appropriate for the proper disposition of the case. On October 1, 2026, the Court granted certiorari in three additional cases: Rhoney v. Barbosa da Cunha, No. 26-104: Immigration officials detained Ricardo Aparecido Barbosa da Cunha—a Brazilian citizen who had lived in the United States for approximately twenty years after entering without inspection—and denied him a bond hearing under 8 U.S.C. § 1225(b)(2)(A). The Second Circuit held that his detention was instead governed by § 1226(a), which permits release on bond, because § 1225(b)(2)(A)’s mandatory-detention requirement applies only to noncitizens apprehended while entering the country or shortly thereafter. The question presented is: Whether 8 U.S.C. § 1225(b)(2)(A) mandates the detention pending removal proceedings of aliens who, like Barbosa da Cunha, are present in the United States without having been admitted. Missionaries of St. John the Baptist, Inc. v. Frederic, No. 25-113: A Catholic religious organization sought to build a shrine to the Virgin Mary on land the organization owned adjacent to its church in Park Hills, Kentucky. Local zoning restrictions prohibited the proposed construction. The question presented is: Whether a land-use regulation that prohibits a religious institution from building a religious structure on its own property constitutes a “substantial burden” on religious exercise under the Substantial Burden Provision of the Religious Land Use and Institutionalized Persons Act, 42 U.S.C. § 2000cc(a). Marschner v. Marschner, No. 25-1349: Under the Uniformed Services Former Spouses’ Protection Act (“USFSPA”), a veteran’s longevity-based retirement pay can be divided in a divorce, but retirement pay based on disability and retirement pay that was waived to receive disability pay are indivisible. The question presented is: Does the USFSPA require state courts to refuse enforcement of indemnification provisions in a divorce settlement agreement?