Minimum Competence - Daily Legal News Podcast
Minimum Competence
Fri 7/21 - NYC Settles With Protesters, FTX Sues SBF, Twitter Subpoenas Warren, and KPMG Generative AI
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Fri 7/21 - NYC Settles With Protesters, FTX Sues SBF, Twitter Subpoenas Warren, and KPMG Generative AI
In today's episode we have NYC paying out to mistreated George Floyd protesters, FTX sues SBF, Twitter to subpoena Sen. Warren, and KPMG says “generative AI” and their board cheers wildly.

On this day in history, July 21, the North Atlantic Treaty, of NATO fame, was ratified in the Senate.

In the wake of World War II, the United States emerged as an unrivaled superpower, boasting a robust military, thriving economy, and moral ascendancy. Despite a history of isolationism, encouraged since the time of George Washington, shifts in policy started to emerge. On March 12, 1947, President Harry S. Truman issued his doctrine of containment, signaling a departure from the U.S. tradition of avoiding non-domestic conflicts. Truman promised aid to all "free people" under threat, marking a shift with financial assistance to Greece and Turkey to shield them from communism. In 1948, the U.S. introduced the European Recovery Program, commonly known as the Marshall Plan, designed to rebuild war-devastated Europe and bolster its economies.

Simultaneously, the Senate approved the Vandenburg Resolution in June 1948, paving the way for U.S. participation in peacetime collective defense systems. Beginning in 1948, confidential discussions among American, British, and Canadian officials eventually expanded to include other future Allies, laying the foundation for the North Atlantic Treaty. Despite strong isolationist and unilateralist sentiments in the Senate and among the American populace, significant events like the Berlin Blockade and the Czechoslovakian communist coup in 1948 helped alter perspectives on Europe. The Red Scare did a lot of that heavy lifting too. 

On April 4, 1949, U.S. Secretary of State Dean Acheson signed the North Atlantic Treaty, aligning the United States more closely with Europe's future. The Senate ratified this treaty on July 21, 1949, with an 83-13 vote. Four days later, President Truman and Secretary Acheson signed the Instrument of Accession, establishing the United States as a founding member of NATO. 


On July 20, 2023, New York City agreed to pay $13 million to hundreds of individuals arrested during the George Floyd protests in 2020. This marks the largest class action settlement ever paid to protesters in the United States. The protests were in response to the death of George Floyd, an unarmed Black man, at the hands of a Minneapolis police officer. Each of the more than 1,300 protestors arrested between May 28 and June 4, 2020, will receive $9,950 as part of the settlement. However, those charged with crimes like arson or property destruction will not receive any part of the settlement, which still requires approval by U.S. District Court Judge Colleen McMahon. Allegations of police misconduct during the protests include the use of pepper spray, excessive force with batons, and "kettling", a practice where police corral protestors into a confined area. Earlier in March, New York had agreed to a separate $7 million settlement for over 300 people arrested during a June 4, 2020, demonstration in the Bronx.

New York to pay $13 million to protesters arrested during George Floyd protests | Reuters


FTX Trading has filed a lawsuit against its founder Sam Bankman-Fried and several former executives, aiming to recover over $1 billion they allegedly misused before the company's bankruptcy. The lawsuit, filed in Delaware bankruptcy court, also includes defendants Caroline Ellison, Zixiao "Gary" Wang, and Nishad Singh. FTX accuses the defendants of misappropriating funds for luxury real estate, political donations, speculative investments, and other personal interests, describing their actions as "one of the largest financial frauds in history." The alleged fraudulent transfers took place between February 2020 and November 2022, when FTX filed for Chapter 11 protection. Bankman-Fried has pleaded not guilty to several criminal charges, while Ellison, Wang, and Singh have pleaded guilty and agreed to cooperate with prosecutors. The lawsuit alleges that a significant portion of the misappropriated funds included over $725 million of equity awarded without any return value, as well as $546 million used to purchase Robinhood Market shares. The case is now pending in the U.S. Bankruptcy Court, District of Delaware.

FTX sues Bankman-Fried, others to recoup more than $1 billion | Reuters


Twitter has announced plans to subpoena US Senator Elizabeth Warren as part of an ongoing dispute with the Federal Trade Commission (FTC) concerning data breaches. Last year, following billionaire Elon Musk's acquisition of the social media company, extensive layoffs and cost reductions led to questions regarding Twitter's ability to comply with an FTC consent order. Twitter has asked for this consent order to be annulled, alleging FTC bias and overreach in its filings in a federal court in San Francisco. Warren, along with several other Democratic senators, previously urged the FTC to scrutinize Twitter's privacy policies post-layoffs and consider enforcing actions against its executives, if necessary. The subpoena demands all communications involving Twitter or Elon Musk between Warren's office and the FTC, as well as between her office and the Securities and Exchange Commission. In 2020, Twitter agreed to pay $150 million in a settlement with the FTC and the Justice Department over allegations of private user information misuse for targeted advertising.

Twitter to subpoena Senator Elizabeth Warren over communications with US agencies | Reuters


KPMG is harnessing generative artificial intelligence (AI) to assist tax professionals and audit processes, marking a significant stage in its $2 billion commitment to AI integration. The firm has developed a 'virtual assistant' which aids in gathering tax data and analyzing tax obligations. Powered by Microsoft's Azure cloud platform and OpenAI's ChatGPT, KPMG envisions a return of up to $12 billion in revenue from the five-year investment. Other "Big Four" accounting firms are also investing heavily in AI, with Deloitte, PwC, and Ernst & Young launching their own generative AI initiatives. While enhancing productivity, the firms remain cautious about the use of AI in audits, aiming to certify, verify, and understand the results it generates. However, the application of generative AI is not without potential risks, including the possibility of overlooking gaps in its applicability across different regions and functions. Despite these challenges, firms recognize AI's transformative potential for their business operations.

KPMG Rolls out Generative AI to Tax Pros, Launches Audit Pilot

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Minimum Competence - Daily Legal News Podcast

Minimum Competence

The idea is that this podcast can accompany you on your commute home and will render you minimally competent on the major legal news stories of the day. The transcript is available in the form of a newsletter at www.minimumcomp.com.

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