.

Shannon uses practical and strategic problem-solving to help companies resolve their business disputes outside litigation, or position them to win through litigation, in the highly complex areas of patents, ERISA, and public law.

Shannon is both a litigator and a constructive problem-solver to avoid litigation. She helps companies protect their intellectual property—from patents and trade secrets to trademark and copyright—and defends companies against accusations that they used a competitor’s intellectual property. Shannon excels at quickly forming a deep and sophisticated understanding of the technology at issue, then effectively communicating arguments in a simple yet compelling way to the non-technical decisionmakers—a generalist district court judge or a lay jury. Shannon has extensive experience with depositions, legal writing and trials, and uses her effective advocacy skills for clients in a broad range of industries, from computer software to cosmetics to medical devices. With her law and economics background, Shannon has a particular specialty in developing sophisticated damages assessments, which requires a deep understanding of her clients’ businesses.

Shannon also represents companies in ERISA litigation and claims processing, and provides advice and compliance support to government entities, companies and non-profits in public law issues, particularly state and federal public open records laws including the Minnesota Government Data Practices Act and the federal Freedom of Information Act.

Shannon has been listed in Best Lawyers in America® for the past six years, and was named a Top Lawyer in Litigation - Intellectual Property and Litigation - Patents by Minnesota Monthly in 2024.

Select Experience

  • Successfully obtained dismissal of FRAND claims in case brought against Chinese patent holder by litigious accused infringer
  • Successfully invalidated all claims of two patents and several claims of a third patent in related PTAB Inter Partes Review proceedings
  • Prevailed at the Federal Circuit Court of Appeals in securing a claim construction ruling that destroyed any infringement argument against a client as to several patents in a competitor’s patent family
  • Obtained preliminary injunction on behalf of medical device company to stop competitor from manufacturing or selling infringing product 

Education

  • University of Chicago Law School (J.D., 2009)
    • with honors; Order of the Coif
  • Barnard College of Columbia University (B.A., 2004)
    • magna cum laude

Bar Admissions

  • Minnesota

Court Admissions

  • U.S. District Court for the District of Minnesota
  • U.S. District Court for the District of Colorado
  • U.S. Court of Appeals for the Eighth Circuit
  • U.S. Court of Appeals for the Federal Circuit

Professional Affiliations

  • Liaison to Justice and Democracy Center Committee, Minnesota Chapter of the Federal Bar Association, 2023 to present
  • Strategic Initiatives/Affinity Bar Liaison Coordinator, Minnesota Chapter of the Federal Bar Association, 2019-present
  • Co-chair and editor of Bar Talk, publication of the Minnesota Chapter of the Federal Bar Association, 2017-2019
  • Committee member, Communications Committee for the Minnesota Chapter of the Federal Bar Association, 2014 to present
  • Co-chair, Ramsey County Bar Association Bench & Bar Fundraiser Committee, 2014-2016
  • Committee member of Ramsey County Bar Association Fundraiser Sponsorship Committee, 2012 to present
  • Participant in Minnesota State Bar Association E-discovery working group and co-author of white paper on e-discovery issues, 2012

Clerkships

  • U.S. Court of Appeals for the Eighth Circuit, Honorable James B. Loken, 2009-2010

Charitable & Civic Involvement

  • Board Member, CornerHouse, 2024 to present.
  • ACT and academic tutor for Cristo Rey high school students, 2011-2015.
  • Founder and coordinator of “Plant an Extra Row” group that donates extra garden produce to local food pantries.

Accolades

  • Best Lawyers in America®, 2021-2025
  • Minnesota Monthly, “Top Lawyers in Minnesota,” 2024
  • IAM Patent 1000, The World’s Leading Patent Practitioners, 2024-2026
  • Consistently providing pro bono legal assistance to those in need through Dorsey’s Pro Bono program
  • Dorsey & Whitney – Scales of Justice Team Award (Housing Discrimination Claim v. City of Minneapolis Team; Housing Team), 2025
  • MSBA, North Star Lawyer, 2012-2013, 2015-2017, 2019-2020, 2024
  • Minnesota Super Lawyers®, 2020-2022
  • Minnesota Super Lawyers®, “Rising Star,” 2014-2022
  • Minnesota Lawyer Magazine, “Up and Coming” Lawyer, 2017
  • Burton Award Distinguished Legal Writing Winner: “Force Majeure and Climate Change: What is the New Normal?”, 2014
  • Top 10% of law school graduating class
  • Admitted to Order of the Coif
  • Joseph Henry Beale Prize for Legal Writing, 2007
  • The University of Chicago Law Review, Executive Articles Editor

Select Presentations

  • Business Data and the Minnesota Government Data Practices Act (May 2014)
  • Government Email: Public or Private Record? (August 2013)
  • Top Ten E-discovery Trends of 2012 (December 2012)
  • Force Majeure and Climate Change: What is the New Normal?, presented to MSBA Construction Law Section (September 2012)
  • Significant E-discovery Cases of 2011 (January 2012)

Insights

Blog Post

Generative AI and the Copyright Office – Part 2 of Long-Awaited Guidance, But Will It Continue?

March 19, 2025

On January 29, the U.S. Copyright Office released Part 2 of its planned 3-part report on the legal and policy issues related to copyright and artificial intelligence (AI). Part 1 of the report, which was published in July 2024, addressed the topic of digital replicas. Part 2 now addresses issues related to the copyrightability of generative AI model outputs. The highly anticipated Part 3 is slated to address copyright infringement and fair use issues involving generative AI. Generative AI Models (Generally) Generative AI models are machine learning models that, when given an instruction or request (a prompt), can generate new content such as text, images, videos, and sounds. Prompts are often textual, but can be other input, such as images. These models learn the underlying patterns and structures of their training data and use them to produce new data based on the prompt. Examples include Meta’s Llama models, OpenAI’s ChatGPT models, and Google’s Imagen 3 model. The creation of prompts themselves has developed into its own category of computer technology—many in the field have begun using generative models to develop large amounts of prompts or to develop optimized prompts. Due to the rising use of these generative AI models, the Copyright Office is publishing guidance addressing issues of copyright law uniquely applicable to AI models. Historical Copyright Law Gives Some Guidance The Copyright Office began Part 2 of its report by explaining how copyright law has kept up with changes in technology, particularly with the inventions of photography, movies, and video games. As technology evolves, the Copyright Office and courts must decide to what extent technology can be involved in works of authorship that can still claim copyright protection. Because technology has always been permitted to be used in generating copyrighted works, the Copyright Office explained that there cannot be a bright-line rule “that registration will be denied merely because a computer may have been used in some manner in creating the work.” Instead, the analysis involves a case-specific sliding scale: “Where AI merely assists an author in the creative process, its use does not change the copyrightability of the output. At the other extreme, if content is entirely generated by AI, it cannot be protected by copyright.” As discussed by the TMCA in the past, the U.S. Supreme Court and the Copyright Office have long held that authorship requires the involvement of human creativity. The crucial question is “whether the ‘work’ is basically one of human authorship, with the computer [or other device] merely being an assisting instrument, or whether the traditional elements of authorship in the work (literary, artistic, or musical expression or elements of selection, arrangement, etc.) were actually conceived and executed not by man but by a machine.” U.S. Copyright Office, Report to the Librarian of Congress by the Register of Copyrights (1965). The Copyright Office also analogized the generative AI model issues to other topics already decided in the law. For example, cases involving commissioning works, where courts have analyzed what level of contribution is necessary to qualify as authorship, seem applicable. A person who merely describes to an author what the commissioned work should do or look like is not a joint author for purposes of the Copyright Act, because such contributions constitute unprotectible ideas. Likewise, a person who provides high-level guidance to a generative AI model would also have difficulty proving sole or co-authorship. Specific Examples Provided by the Copyright Office The Copyright Office offered a few examples to illustrate the boundaries of copyright protection for material produced (at least in part) by generative AI models. Prompts On one end of the spectrum, prompts alone do not provide sufficient human control to make users of an AI system the authors of the output. “Prompts essentially function as instructions that convey unprotectible ideas.” The Copyright Office provided its own generative example to illustrate its point: While this prompt is very descriptive, and the resulting image reflects some of the instructions, it does not reflect all of them (there is no “highly detailed wood”). The generative AI model also uses its own content to fill in gaps (the cat’s breed, clothes beneath the robe, human hands, etc.). The Copyright Office noted that identical prompts can generate multiple different outputs, which further underscores the lack of human control. This reality may change as technology evolves. “There may come a time when prompts can sufficiently control expressive elements in AI-generated outputs to reflect human authorship. If further advances in technology provide users with increased control over those expressive elements, a different conclusion may be called for.” But for now, the Copyright Office’s position is clear: prompts are not copyrightable. Expressive Inputs Expressive inputs are inputs of copyrighted works into generative AI models with instructions to modify those works. For example, a human author may create a drawing, input that work into an AI system, and instruct the system to modify color or scale. Or a user could upload a copyrighted story written in the first person point of view, and instruct the model to re-write the story from that of a third person. These inputs are different from prompts because they contribute more than just an intellectual idea. The Copyright Office again provided its own example: Here, the Copyright Office appears more inclined to provide protection, though that protection would not cover the entire output. Instead, “copyright in this type of AI-generated output would cover the perceptible human expression.” Modifying or Arranging AI-Generated Content Finally, the Copyright Office addressed situations where a generative model is used as an initial step, but the author further modifies the output. The Copyright Office noted that whether or not such modifications rise to the minimum standard of originality, that is, whether the work is the product of creative choices with respect to the selection of the images and/or text that make up the work and the placement and arrangement of the images and/or text on each of the work’s pages. The copyright would extend to the material the human author contributed but would not extend to the underlying AI-generated content itself. The inclusion of elements of AI-generated content in a larger human-authored work does not affect the copyrightability of the larger work as a whole. “For example, a film that includes AI-generated special effects or background artwork is copyrightable, even if the AI effects and artwork separately are not.” Key Takeaways The key takeaways from Part 2 of the report include how the Copyright Office interprets the human authorship requirement as it relates to the use of models. The Copyright Office explained that “[c]opyright protects the original expression in a work created by a human author, even if the work also includes AI-generated material,” but “[c]opyright does not extend to purely AI-generated material, or material where there is insufficient human control over the expressive elements.” Whether the human interaction with the generative AI model is sufficient to constitute authorship should be decided on a case-by case basis. In the words of the Copyright Office: “prompts do not alone provide sufficient control.”

Blog Post

Hashtag or Pound? One Law Firm’s Quest to Trademark #law

February 16, 2023

How would you pronounce #law? Is it “hashtag law,” as the PTO examiner suggested would be the most common understanding, or “pound law,” as alleged by the unsuccessful registrant of #law as a service mark. And to what does it refer: a hashtag for a social media topic, or a number that can be dialed from a mobile phone to reach an attorney referral service? Law firm Pound Law, LLC filed a lawsuit against the PTO and its director, arguing that its application for #law was improperly denied. According to Plaintiff, “the #LAW mark has become widely recognized by the relevant public as a distinctive brand and as a mnemonic/vanity telephone number mark uniquely associated with the services of Morgan & Morgan,” because Plaintiff spent “hundreds of millions” of dollars advertising it since 2006. Notably, this #law apparently only applies to telephone calls made on a mobile phone; it does not work on landlines, and the firm uses the website “www.forthepeople.com” and not either Pound Law or Morgan & Morgan. The examiner, and TTAB, decided that “consumers would not perceive [Plaintiff’s] use of #LAW as a source indicator but rather only as a means to contact [Plaintiff], based on the manner of use.” The history of this mark illustrates how quickly technology has unfolded over the past 15 years. Morgan & Morgan allegedly began using #law as a mnemonic and vanity phone number in 2006—the same year Twitter was founded. A few years later, Twitter took off: it had 300,000 tweets per day by the end of 2008, which ballooned to over 50 million tweets per day by early 2010. In 2022, there were over 500 million tweets per day, a non-negligible number of them using #law to identify the subject. A Twitter search renders countless tweets from law firms to law schools, legal consultants, protestors, and coaches using #law. Is Morgan & Morgan’s use really as “unique” and “distinctive” in 2023 as it may have been in 2007? The treatment of this mark calls to mind the Booking.com saga, covered extensively in this blog. The TTAB determined that the mark “Booking.com” was not registrable on the basis that it was generic, described here. The TTAB decision was overturned by Judge Brinkema in the Eastern District of Virginia, which held that Booking.com had acquired distinctiveness, described here, but awarded fees to the PTO because the case had been brought in district court instead of appealed directly to the Federal Circuit, as described here. The Fourth Circuit affirmed the District Court’s decision that the mark is registrable, but ordered the plaintiff to pay the PTO’s fees on appeal, described here. The PTO petitioned for certiorari to the U.S. Supreme Court, which was granted as described here, and the Supreme Court ultimately ruled that Booking.com is registrable, rejecting the premise that a generic.com term is ineligible for trademark protection, described here. This also calls to mind a different source of trademark obsolescence: trademarks that have been lost due to genericide. Among these are the yoyo, the flip phone and the escalator – all of which were marks associated with one brand until they became so widely used that they no longer identify a specific brand. Will #law go the way of the yoyo, or will it follow the winding path of the Booking.com decisions? Only time will tell.

Firm Highlights

Insights

Observations on the SEC’s 2027 Examination Priorities

The SEC’s Division of Examinations (the “Division”) recently announced its examination priorities (“Exam Priorities”) for fiscal year 2027.1 Although many of the Division’s core areas of focus remain consistent with fiscal year 2026, the 2027 Exam Priorities include notable changes and refinements, which we discuss below, along with other key 2027 examination priorities. Dorsey Observations Renewed focus on economic conflicts of interest. After certain economic-incentive topics received less emphasis in the 2026 Exam Priorities2, the Division has again expressly identified economic conflicts as an examination focus. The 2027 Exam Priorities indicate that the Division will prioritize reviewing advisers’ fiduciary obligations relating to economic conflicts of interest raised by fee rebates, fee and expense calculations, cash management, quid pro quo arrangements, and deposits and withdrawals. Greater emphasis on private-fund practices. Building on the private-fund items in the 2026 Exam Priorities, the 2027 Exam Priorities indicate that the Division will assess private-fund disclosures and controls relating to investment allocations, leverage, affiliated service providers, and fees and expenses. The Division also identified investments in private companies through special purpose vehicles (“SPVs”) and loans provided by private funds and business development companies (“BDCs”) as products the Division will scrutinize. Advisers, particularly private-fund advisers, should evaluate whether their disclosures and compliance programs address these areas. Expanded focus on AI-related cybersecurity risks. While the 2026 Exam Priorities focused on advisers’ use of and representations regarding artificial intelligence (“AI”), the 2027 Exam Priorities specifically highlight AI-enabled cybersecurity threats, including AI-generated phishing and synthetic or “deepfake” voice and video used for social engineering. The shift signals that registrants should consider whether their cybersecurity policies and controls adequately address these evolving threats. New focus on proxy advisory firms. The 2027 Exam Priorities state that the Division will examine advisers that rely on proxy advisory firms, including how those advisers evaluate the firms’ recommendations, assess the bases for those recommendations, identify potential conflicts of interest, and determine whether that reliance satisfies applicable legal obligations. Advisers that rely on proxy advisory firms may wish to consider whether their compliance programs address these areas. Updated focus on Regulation S-P and Regulation S-ID. The 2026 Exam Priorities stated that the Division would engage firms during examinations regarding their progress in preparing incident response programs ahead of the compliance dates for the amendments to Regulation S-P and would examine compliance with the amended rule after those dates. The 2027 Exam Priorities indicate that examinations will focus on whether firms have developed, implemented, and maintained reasonably designed policies and procedures addressing administrative, technical, and physical safeguards to protect customer information and that, in accordance with the amended rule, staff will evaluate response program policies and procedures for unauthorized access to or use of customer information, including customer notification procedures and oversight of service providers. With respect to Regulation S-ID, the 2027 Exam Priorities indicate that examiners will assess whether firms are updating their Identity Theft Prevention Program to address emerging risks, such as those related to AI and stolen credentials. Advisers may wish to consider whether their compliance programs address these areas, as applicable. Summary of Other 2027 Examination Priorities Beyond the developments discussed above, many of the Division’s core examination priorities remain consistent with fiscal year 2026. These include investment adviser fiduciary obligations and compliance programs, examinations of never-examined and recently registered advisers, and cybersecurity and operational resiliency. The Exam Priorities are not exhaustive, and examinations will vary based on each registrant’s business, activities and risks. Advisers should consider the 2027 Exam Priorities in reviewing their compliance programs and preparing for potential examinations, including by: Reviewing risk disclosures and controls. The Division states that, when examining advisers to private funds, it will assess whether investment-related risk disclosures are consistent with fiduciary standards and whether compliance policies, procedures, and controls are designed to address both fund-level and investment-level risks. Reviewing disclosures on allocations, leverage, and affiliated service providers. The 2027 Exam Priorities identify disclosures related to certain investments and allocations, the use of debt and fund-level lines of credit, and the use of affiliated service providers as examples. Confirming the accuracy of fee and expense calculations. The Division states that it will assess the accuracy of fee and expense calculations at both the fund and investment levels, and it identifies fee rebates, cash management, quid pro quo arrangements, deposits, and withdrawals as areas in which economic conflicts of interest may affect the impartiality of advice. Reviewing recommendations of illiquid or hard-to-trade products. The Division states that it will prioritize advisers that recommend products that are difficult to trade, have unusual features, or are illiquid, including loans provided by private funds or BDCs and investments in private companies through SPVs. Confirming that the compliance program is implemented and reviewed. The Division states that it will review compliance program components such as marketing, valuation, and custody, as appropriate, and will typically analyze the annual compliance review. It will also focus on compliance practices when advisers have started advising new asset classes or clients or grown through mergers or acquisitions. 1 SEC Division of Examinations 2027 Examination Priorities. 2 See Dorsey’s Client Alert on the SEC’s fiscal year 2026 exam priorities.

Event/Resource

Corporate Counsel Symposium 2026 Materials Hub

Materials Symposium Agenda Sessions 8:30 am - 9:30 am CT Session A: The Corporate Compass: Finding True North When Ethical Duties Conflict Philip Kaplan, Senior Legal Counsel, Howden Re Lucia Suljic, Vice President, Corporate Legal, Canon USA Nicole Stanton, Partner & Deputy General Counsel, Dorsey & Whitney LLP This panel addresses ethical obligations of in-house counsel, including balancing obligations and duties that may conflict with each other. How should a responsible in-house lawyer deal with those challenging situations? Rather than stick to an academic discussion, this panel will revolve around a series of practical scenarios that are designed to be realistic and timely, including situations where counsel is asked to represent both the company and an individual, how and when to disclose uncomfortable facts and inconvenient documents, issues involving changing firms and companies, and multijurisdictional practice. The panel will feature discussion from two experienced in-house lawyers and Dorsey’s Deputy General Counsel. Session B: Managing Rapid Regulatory Change in International Trade and Cross-Border Investment Nathan Brower, Executive Vice President, General Counsel, Nature’s Sunshine Greg Ogunsanya, Senior Vice President, General Counsel and Corporate Secretary, H.B. Fuller Kathryn Wood, Senior Vice President & General Counsel, DecoPac, Inc. Dave Townsend and Lawrence Ward, Dorsey & Whitney LLP This program is designed for attorneys advising on cross-border transactions, international trade, regulatory compliance, and corporate governance matters. Panelists will examine recent developments in U.S. trade and investment law and policy, as well as their impact on international collaborations, corporate compliance, and mergers and acquisitions. The discussion will explore how general counsel and in-house legal teams assess and manage evolving trade-related risks within their organizations. Particular focus will be given to developments during the first two years of the second Trump Administration, including changes in tariff policy, tariff refunds, export controls, economic sanctions, and national security reviews of foreign investment. Through a discussion of regulatory trends and practical case studies, attendees will gain a deeper understanding of the legal risks and compliance obligations associated with cross-border business activities, and hear about practical strategies for advising clients and managing compliance obligations in a rapidly changing trade and investment environment. 9:45 am - 10:45 am CT Session A: The Elon Musk Cases: What Tesla and Twitter Can Teach Your Board of Directors Loren Unterseher, Managing Partner, Oxbow Industries, LLC Shulamite White, Chief Legal Officer and Head of People, Motive Technologies Kirsten Schubert, Tom Swigert, and Jonathan Van Horn, Dorsey & Whitney LLP Recent cases involving Elon Musk and his businesses have had significant impact on principles governing board of directors’ fiduciary duties and corporate processes. This panel will examine recent litigation involving Elon Musk, Tesla, and Twitter, and its effects on the law governing the duties of directors and executives, including the executive compensation and director compensation processes, conflicts that may arise when a single executive has control over multiple businesses, and the ramifications of tweets or other public statements by an executive. Session B: All Eyes on DEI: Managing Diversity Efforts Amid Regulatory Scrutiny and Potential Litigation Maggie Dalton, Senior Commercial Attorney, Cargill; Board Co-Chair, Twin Cities Diversity in Practice Laura A. Vannelli, Legal Counsel, Mayo Clinic Susan Lorenc and Jack Sullivan, Dorsey & Whitney LLP The legal and regulatory landscape surrounding diversity, equity, and inclusion (DEI) initiatives has changed dramatically over the past two years. Law firms and legal departments are continuing to grapple with how to recruit, retain, and develop talent from a wide range of personal backgrounds, in a world where previously accepted recruiting and employment practices are facing increased scrutiny and litigation. This program will provide a practical overview of the current legal regime, including recent federal enforcement actions and litigation trends associated with DEI initiatives. Panelists will discuss practical ways in which organizations can pursue and retain legal talent and increase inclusion while minimizing legal, business, and reputational risk. 11:00 am - 12:00 pm CT Session A: Governance in an Age of Increasing Unpredictability James Chosy, Senior Executive Vice President and General Counsel, U.S. Bancorp Todd Hartman, Executive Vice President and Chief Legal and Risk Officer, Best Buy Co., Inc. Alan Rosselot, Associate General Counsel & Assistant Secretary, Delta Air Lines, Inc. Cam Hoang and Robert Rosenbaum, Dorsey & Whitney LLP More than ever, ensuring that boards are well-informed and forward-thinking is critical to a company’s success. Join our panel of corporate governance experts as they share their experiences advising boards through crisis and unpredictable events; capitalizing on, but also checking, disruptive technologies; and positioning the company to succeed in an environment of shifting government priorities. Session B: A Day in the Life of a Trademark, Copyright & Advertising Attorney: A Hypothetical Case Study Alexander Kim, Vice President and General Counsel, Binks Nate Whitaker, Chief Legal Officer and General Counsel, Crumbl Cathy Dahl and Tiffany Shimada, Dorsey & Whitney LLP What issues are companies facing daily while developing rights in intellectual property, protecting those rights, and staying in compliance with myriad potential issues related to advertising, social media, relationships with influencers, and environmental or governmental claims? This panel will feature two in-house counsel who are navigating these issues, utilizing a hypothetical case study, with the support of two Dorsey attorneys helping to develop a roadmap for meeting business objectives and minimizing the risk of claims. 12:00 pm - 1:15 pm CT Keynote Address Dr. Rebecca Heiss, Stress Physiologist Dr. Rebecca Heiss is a stress physiologist, author, and sought-after speaker who helps audiences transform fear and stress into fuel for greater performance and resilience. Her research has been recognized as “transformative” by the National Science Foundation, and she is the author of two books, Springboard and Instinct. Through her Fear(less) message, Rebecca inspires audiences with practical, science-based strategies to train our brains to work for us – not against us – and navigate change and uncertainty with greater confidence.

Insights

Minnesota Consumer-Fraud Enforcement: Disclaimers Won’t Cure Deception, and Penalties Can Add Up

Misleading advertising claims can lead to costly consequences. In State of Minnesota ex rel. Ellison v. Wall & Associates, Inc., No. A25-2064, 2026 WL 3118291 (Minn. App. Oct. 19, 2026), the Minnesota Court of Appeals recently affirmed a bench trial verdict against a tax-relief company and two executives for violations of the Minnesota Consumer Fraud Act (“MCFA”) and the Minnesota Deceptive Trade Practices Act (“MDTPA”). The decision, which affirmed a substantial restitution and civil penalty judgment, underscores the broad power of the Minnesota Attorney General to act against deceptive sales practices. The decision also offers practical lessons for businesses seeking to reduce liability risks in consumer-facing communications. Background Wall & Associates (“W&A”), a Virginia-based tax-relief company, marketed assistance to taxpayers seeking relief from outstanding federal and state tax liabilities, often with offers in compromise—agreements to settle tax liabilities for less than the amount owed. In its extensive advertising campaigns, W&A represented that its average client received a 90% reduction in their tax debt, that it was a local company with Minnesota offices, that it provided legal services, and that it would “Solve ALL Tax Problems.” In reality, W&A’s promises bore little resemblance to what many clients received. Most of W&A’s clients saw just a 9.5% reduction in federal tax debt and 1.2% in state tax debt. W&A had no permanent Minnesota offices. And W&A provided neither legal representation nor assistance with filing tax returns—those services required referrals to separate firms for an additional fee. All the while, W&A clients paid upfront and recurring fees, including during periods when W&A did no work on their cases. Minnesota Attorney General Keith Ellison sued W&A, its founder and owner Ernest Kenneth Wall, and its president and CEO Patrick Mark Yates, alleging violations of, among other laws, the MCFA and the MDTPA. Following a 12-day bench trial, the district court determined that W&A violated the MCFA and MDTPA through its false and embellished advertising. The district court also held Wall and Yates individually liable for those violations because they directed, participated in, and acquiesced in the violations. The district court ordered injunctive relief, $2.7 million in restitution (with Wall and Yates jointly and severally liable for $1.3 million), and civil penalties of $786,517 against W&A, $415,500 against Wall, and $207,750 against Yates. The district court also awarded over $2.5 million in attorneys’ fees and costs to the state. W&A, Wall, and Yates appealed to the Minnesota Court of Appeals, which affirmed the district court’s decision on October 19, 2026. Although W&A, Wall, and Yates challenged the judgment on numerous grounds, several highlights of the decision provide important takeaways for consumer-facing businesses. Individual Reliance Is Not Required for Statutory Liability W&A argued that Attorney General Ellison had to prove a causal nexus between each violation of the MCFA and MDTPA and the injury to a particular consumer to establish liability. In W&A’s view, this required proof that each injured consumer had personally relied on W&A’s false representation. The Court of Appeals rejected this argument based on the MCFA’s and MDTPA’s plain language, which requires no proof of actual deception or confusion by consumers. The Court of Appeals finally pointed to the Minnesota Supreme Court’s decision in State v. Minnesota School of Business, Inc., which held that when a defendant’s misrepresentations are directed at and affected “a broad group of consumers, proof of direct individual reliance is not required to establish a causal nexus between MCFA violations and the harm suffered by consumers.” 935 N.W.2d 124, 135 (Minn. 2019). The Court of Appeals affirmed, however, that a causal nexus is necessary to support an award of damages under the MCFA and MDTPA. In making that determination, district courts look to various factors, including whether the misrepresentations were “longstanding, pervasive, and widespread in communications directed to consumers,” whether the seller intended and understood that consumers would rely on the misrepresentations, and whether the information was of a kind on which consumers would typically rely. The Court of Appeals’ decision continues Minnesota School of Business’s broad interpretation of liability under the MCFA and the MDTPA. Coordinated marketing campaigns to a “broad group of consumers” may expose businesses to MCFA and MDTPA liability without customer-by-customer proof of injury. That said, a causal nexus remains an element of an MCFA and MDTPA claim, and businesses involved in litigation should build a clear record at trial and on appeal showing how each of the relevant factors bears on the causal-nexus inquiry. Contractual Disclaimers Are Not an Automatic Defense to a Misleading Pitch W&A next argued that disclaimers in its client contracts prevented consumers from claiming they had been misled by its advertising. Reiterating that individual reliance is not required under the MCFA and MDTPA, the Court of Appeals held that a contractual disclaimer does not necessarily defeat a claim based on a conflicting oral representation. And on the facts of this case, the Court of Appeals agreed with the district court that W&A’s contractual disclaimers were insufficient given the extensive misrepresentations by W&A and the unequal bargaining power between it and its customers. This holding confirms that contractual disclaimers are not a cure-all for misleading advertising or sales practices. Businesses should review the entire customer journey, including pre-contract representations, as those representations may survive a contractual disclaimer to the contrary. And if faced with litigation, businesses should build a strong record, both at trial and on appeal, showing why any disclaimer is effective in context. The State Has Broad Authority to Seek Restitution W&A also challenged Attorney General Ellison’s authority to seek restitution under the state’s parens patriae authority to protect residents’ collective interests, arguing that injury to only 228 Minnesotans did not affect a sufficiently substantial segment of the population. The Court of Appeals rejected a simple headcount approach, instead explaining that the state had a legitimate interest in protecting residents’ economic well-being as a whole. In any event, the Court of Appeals held that if restitution was not appropriate under the state’s parens patriae authority, then it would still be appropriate under the Attorney General’s enforcement powers under Minn. Stat. § 8.31. The decision reinforces that the broader and more sustained the deceptive advertising, the stronger the case for restitution to protect Minnesotans’ economic interests. Civil Penalties Accrue Per Violation, Not Per Defendant The Court of Appeals finally rejected W&A’s claim that the Attorney General’s enforcement powers under Minn. Stat. § 8.31 permit only civil penalties of up to $25,000 for each defendant. Rather, the Court of Appeals explained that penalties are limited to $25,000 per violation. Multiple violations can therefore produce substantially greater penalties. The Court of Appeals also rejected the argument that restitution made penalties unnecessary: repaying consumers does not eliminate the need to address gains from deceptive conduct and deter future violations. Final Takeaways Align every consumer-facing communication. Broad and extensive marketing campaigns can expose businesses to stronger enforcement standards under the MCFA and MDTPA, making it critical that consumer communications remain accurate and consistent from the first advertisement through the final sale. Plan for layered enforcement exposure. Penalties under the MCFA and MDTPA can add up quickly: W&A, Wall, and Yates ultimately faced more than $6 million in civil penalties, restitution, and attorneys’ fees. The decision continues a line of Minnesota cases recognizing the Attorney General’s broad consumer-protection authority. Details matter. Although the Attorney General’s enforcement power is broad, it is not boundless. As the Court of Appeals explained, issues of causation, the effectiveness of contractual disclaimers, and the availability of restitution and civil penalties all turn on the specific facts of the case. Effective advocacy at trial and on appeal is critical to developing the facts relevant to liability and damages.

News

Dorsey & Whitney Advises Beijing Xunzhong on Two Consecutive H Share Placings Raising HK$418.5 Million

International law firm Dorsey & Whitney LLP acted as Hong Kong legal advisors to Beijing Xunzhong Communication Technology Co., Ltd. (“Xunzhong”) as to Hong Kong law in connection with two consecutive placings of new H shares under general mandate (the “First Placing” and the “Second Placing”, respectively, and together, the “Placings”). Xunzhong’s H shares are listed on the Main Board of the Hong Kong Stock Exchange (Stock Code: 2597). Winbull Securities International (Hong Kong) Limited acted as sole overall coordinator and placing agent on both Placings. The First Placing of 11,190,000 new H shares at HK$28.20 each was completed on September 17, 2026, followed by the Second Placing of 3,550,000 new H shares at HK$29.00 each on October 30, 2026. The Placings raised approximately HK$315.56 million and HK$102.95 million in gross proceeds, respectively, or approximately HK$418.51 million in aggregate (approximately HK$415.96 million in aggregate net proceeds). Both Placings were conducted under the same general mandate granted by shareholders at Xunzhong’s 2025 annual general meeting, and each was completed within one week of the signing of its placing agreement. Completing placings in consecutive months is relatively uncommon in the Hong Kong market, and doing so called on the technical depth of Dorsey’s Hong Kong Capital Markets team. Working closely with Xunzhong to understand its business needs and prepare the transaction documents, the team addressed in quick succession the remaining capacity under the general mandate, disclosure of the use of proceeds and the maintenance of Xunzhong’s public float, enabling both Placings to be completed seamlessly. “We are pleased to have advised Xunzhong on both Placings,” said Rachel Han, Partner and Co-Head of Dorsey’s Asia Capital Markets practice. “We appreciate the trust placed in our team and the close collaboration among all parties involved. We look forward to supporting Xunzhong as it continues to execute its growth strategy and pursue future capital markets opportunities.” Xunzhong is principally engaged in cloud-based communications services and enterprise digitalization services in the PRC. As disclosed in its announcements, the net proceeds of the First Placing are allocated to developing Xunzhong’s new computing power operation services business, while those of the Second Placing will be used to integrate model-as-a-service (MaaS) and AI agent capabilities into its existing cloud communications platform-as-a-service (PaaS) platform and software-as-a-service (SaaS) products. Approximately 55% of the net proceeds of the Second Placing will be used for computing power equipment upgrades for the MaaS system, approximately 35% for MaaS, PaaS and SaaS platform upgrades, and approximately 10% for working capital and general corporate purposes. With a single MaaS platform and shared computing power supporting its PaaS and SaaS offerings, Xunzhong intends for its MaaS, PaaS and SaaS capabilities to complement and reinforce one another, and to address customer needs from multiple angles, from embedding AI in customer communications and business workflows to maintaining stable performance at scale and keeping customer data within controlled environments. Partner and Co-Head of Dorsey’s Asia Capital Markets practice Rachel Han and Of Counsel in the Capital Markets and Corporate Compliance group Carlton Ng, along with Associate Kristy Ting, led the Dorsey Hong Kong Capital Markets & Corporate Compliance group in advising Xunzhong on both Placings.