In this Issue: Global Regulatory Cooperation with Jonathan Armstrong Infographics are the New Soundbites: A Look at Hydraulic Fracturing The Newtown Tragedy & Camera-Chasing at its Worst Why Netflix Shouldn't Back Down The SEC Gets its Groove Back Blogs Worth Following LEVICK in the News

1. EDITION 22
Weekly January 4, 2013
The Newtown Tragedy
& Camera-Chasing at its Worst
with Stefanie Fogel
Ron Frank / Shutterstock.com

2. 03 Contents
04 Global Regulatory Cooperation
with Jonathan Armstrong
06 Infographics Are the New Soundbites:
A Look at Hydraulic Fracturing
10 The Newtown Tragedy
& Camera-Chasing at its Worst
In case you missed these stories
during the holidays…
12 Why Netflix Shouldn’t
Back Down
16 The SEC Gets Its
Groove Back
21 Blogs
Worth Following
22 LEVICK
in the News
Ron Frank / Shutterstock.com
COVER Image: On December 14, 2012, Adam Lanza, age 20, fatally shot twenty children and six adult staff members and
wounded two at Sandy Hook Elementary School in the village of Sandy Hook in the town of Newtown, Connecticut. Before
driving to the school, Lanza had shot and killed his mother, Nancy Lanza, at their Newtown home. After killing students and
staff members, Lanza committed suicide by shooting himself in the head as first responders arrived.

3. Global Regulatory
Cooperation
with Jonathan Armstrong
In this LEVICK Daily video interview, we discuss global regulatory cooperation with Jonathan
Armstrong, a partner at Duane Morris, LLP. Regulators continue to share information and pursue
similar targets across sovereign borders, but they are also competing more for the reputational and
political benefits that high-profile enforcement actions provide.
05

4. Infographics
Are the
New Soundbites:
A Look at Hydraulic Fracturing
Ken Lopez
Founder & CEO, A2L Consulting
T
The courtroom is a forum where With information flowing faster than ever
issue advocacy is enhanced by before and with timelines for decisions
persuasive litigation graphics. How- involving billions or even trillions of dollars
ever, other settings exist where at- shrinking (e.g. the recent Congressional
torneys, consultants, politicians, lobbyists and fiscal cliff debate), we believe the need for
advocacy organizations must persuade skepti- quickly produced lobbying presentations is
cal audiences. expanding quickly.
This article focuses on the creation of advo- By way of example, we tackle the hot-button
cacy graphics for a particular issue: hydraulic issue of fracking to show how issue advocacy
fracturing, better known as fracking. Advocacy presentations may be used when many scien-
or lobbying graphics are especially valuable as tific issues remain to be answered and no clear
the material may be used to educate a poten- national consensus yet exists.
tial jury pool, to persuade and inform govern-
Fracking is the modern evolution of a 60-year
ment officials and to support settlement nego-
old production stimulation technique that in-
tiations. These advocacy presentations may be
volves injecting fluid at very high pressure into
distributed via PowerPoint, YouTube or even
a well. This technique is widely used to extract
delivered in person from an iPad®.
07

5. Weekly
...information conveyance requirements have the
common theme that there is a skeptical audience
who needs to learn and understand enough about an
issue to see that the presenter’s position is correct.
water from the tools and substances used in reserves that can be tapped by fracking will
the fracking process. Whereas groundwater last decades or centuries longer than the na-
is typically found within hundreds of feet of tion’s domestic oil reserves, thus contributing
the surface, fracking occurs miles beneath the to the drive toward energy independence. Such
surface of the earth. advocacy pieces are typical of the work we cre-
ate. Most often our work is used in litigation or
Our advocacy presentation goes on to respond
arbitration. However, we also create print and
to challenges regarding the nature of the frack-
animated presentations for lobbying organi-
ing fluid. We aid in dispelling those concerns
zations around legislative and policy advo-
by using a pie chart to illustrate the point that
cacy work or even as part of early settlement
roughly 99 percent of the fluid is merely water
natural gas from shale, a form of rock that is that energy companies are seeking to recover negotiations. From our perspective, all of these
and sand, while the remaining amount is
found all over the United States in large quan- this trapped natural gas. information conveyance requirements have
composed of chemicals that have familiar and
tities. The process produces tiny fissures in the the common theme that there is a skeptical
While we do not take any position in the reassuring uses—such as soaps, deodorants
rock, freeing natural gas for recovery. audience who needs to learn and understand
heated debate over fracking, we have prepared and household plastics. The advocacy mes-
enough about an issue to see that the present-
Natural gas companies insist that fracking is this narrated presentation (note: it already has sage is that the environmental concerns about
er’s position is correct.
safe for people and the environment. They also more than eighty-thousand views on YouTube) fracking are overstated.
believe it can produce enough energy, from that theoretically could be used to defend More often than not, seeing is believing in our
A two part summary chart is then used to high-
purely domestic sources, to last for decades or fracking against its opponents in a courtroom business. Comments from all sides encouraged
light the benefits of fracking in terms of energy
perhaps centuries. setting or used as a widely distributed issue and welcomed. L
independence, environmental advantages, and
advocacy presentation. For related articles and information, consider downloading
Indeed, a study released in July 2011 concludes underscores the benefits of fracking, proving
our free 130-page book on Environmental Litigation.
that a large field of rock on the New York- Our fracking presentation first shows, in sche- the benefits far outweigh the minimal risks.
Pennsylvania border known as the Marcellus matic form, how far below the earth’s surface For tips on winning more cases, subscribe free to The Litiga-
Finally, a bar graph that uses schematic
tion Consulting Report.
Shale can safely supply 25 percent of the Na- fracking occurs and the industry’s routine use
drawings of gas reservoirs and a barrel of oil
tion’s natural gas needs. Thus, it is no surprise of cement and steel casings to protect ground
demonstrate that the domestic natural gas
08 09

6. Weekly
his claim that he filed it to prevent a similar George Jepsen provided an ideal response
attack in the future. When one considers all template when he defined Mr. Pinsky’s case as
that Sandy Hook Principal Dawn Hochsprung misguided and clearly stated that a legislative
and other heroic teachers and administrators response would be far more appropriate than
did to strengthen security at the school prior legal action.
to the attack, it’s clear that Mr. Pinsky’s allega-
Clearly, Mr. Jepsen was prepared for the even-
tions are unfair and unfounded. At the same
tuality that a plaintiffs’ attorney might attempt
time, it’s hard to see Mr. Pinsky as financially-
to win media coverage from the tragedy. That
motivated, given the high probability that his
enabled to him to articulate a rapid, measured
case would be thrown out long before ever it
response that achieved the dual goals of deny-
reached settlement or trial.
ing culpability and remaining sensitive to the
No, this threatened lawsuit was about public- emotionally-charged atmosphere. Juxtaposed
ity, plain and simple. In that regard, Mr. Pinsky with Mr. Pinsky, Mr. Jepsen seemed calm, col-
got exactly what he wanted from CNN and lected, in control, and—above all—in the right.
other national news outlets that put him front
It’s a sad reality that all leaders of organiza-
and center in recent news cycles.
tions can find themselves in the same uncom-
Ron Frank / Shutterstock.com
Many plaintiffs’ attorneys seek to leverage the fortable position of being targeted by oppor-
promotional and marketing opportunities that tunistic plaintiffs’ attorneys with no real case.
accompany major events just as aggressively as But with sound planning, careful preparation
The Newtown Tragedy they pursue the big awards that can come with
courtroom victories. To highlight just one ex-
ample, we need look no further than the Gloria
and timely delivery of credible messages, they
should all feel confident that they can make
their critics look just as silly as Mr. Pinsky
& Camera-Chasing at its Worst Alreds of the world to see just how valuable it
is for plaintiffs’ attorneys to keep themselves in
looks today. L
Gene Grabowski is an Executive Vice President at LEVICK
front of the cameras as often as possible. and a contributing author to LEVICK Daily.
Gene Grabowski
The problem for companies, government agen-
Originally Published on LEVICK Daily
cies, hospitals, schools and other institutions
is that these plaintiffs’ attorneys cannot win
To be fair, most plaintiffs’ attorneys would an increasingly essential element of every plain-
publicity for themselves without first win-
never dream of capitalizing on a tragedy like tiffs’ attorney’s practice. Few of them chase am-
ning publicity for their cases. Too often that
the Sandy Hook massacre for publicity or finan- bulances anymore; but nearly all of them chase
means dragging defendants’ otherwise good
cial gain. But while Irving Pinsky’s $100 million the cameras when one seems nearby.
names through the mud in as many venues
lawsuit against the state of Connecticut does not
The fact that Mr. Pinsky quickly withdrew his as possible. For those organizations caught in
aptly represent the profession, it does highlight
misguided lawsuit does little to substantiate the crosshairs, Connecticut Attorney General
10 11

7. Weekly
If I were advising Netflix, I would tell the com-
pany to tell the SEC to bring it on,” says Neil
Eggleston, a partner at Kirkland & Ellis LLP who
has defended a number of high-profile compa-
nies and individuals entangled in regulatory
enforcement matters. “It seems to me that this
is a misguided attempt at regulation through
enforcement that is entirely divorced from the
origins of Reg FD. The rule was put in place to
prevent selective disclosure of material informa-
tion to certain analysts, thereby providing them
an unfair market advantage. Moreover, Reg FD
only requires that material information be publi-
cally disseminated; it does not mandate how that
information should be publically disseminated.
“Thus, to say that a Facebook post to 245,000 fol-
lowers breaks with Reg FD is a stretch. This is not
a case of targeted dissemination—and if Netflix
makes that case in court, I think it will win.”
Why Netflix Shouldn’t Back Down
mission’s Luddite views if their case against
Netflix ever goes to trial.
Mr. Eggleston’s insights hit the nail on the head
Wells Letters Can’t Compete with Little Red Envelopes Earlier this month, Netflix received a dreaded in an age when social media have fundamen-
Wells Notice over the alleged posting of ma- tally changed how public companies com-
terial information to CEO Reed Hastings’ municate with the marketplace. Does anyone
Richard S. Levick, Esq.
public Facebook page in July 2012. The SEC believe that Netflix’s 10-Q or 8-K filings are as
Originally Published on Fastcompany.com
enforcement staff believes that Mr. Hastings widely read as Mr. Hastings’ Facebook page?
broke with Reg FD when he posted a 43-word Does a traditional news release (the SEC’s pre-
U
message about the one billion hours of video ferred communications channel) have the viral
nder Chairman Mary Schapiro, continue the Commission’s transition into the
subscribers accessed in June of 2012. Already, allure of a tweet of a popular CEO?
the U.S. Securities and Exchange 21st Century unabated.
a number of pundits—the Wall Street Journal’s
Commission (SEC) has done a The answer to both questions is a resounding
But when it comes to social media, Regulation Holman Jenkins, in particular—have ques-
Herculean job of moving from no. And, as such, the SEC’s case against Mr.
FD, and what constitutes a “public” disclo- tioned the wisdom of the enforcement staff’s
what was becoming an increasingly irrelevant Hastings and Netflix represents a tremendous
sure, it’s hard to see the SEC as anything but a decision to classify Hastings’ social media
and antiquated government agency to one that opportunity to finally open the flood gates for
typewriter-driven bureaucracy. There’s a very activity as anything but public. Those pundits
is again an essential element of our body capi- the entire sphere of public companies seeking
good chance that the courts will scold the Com- aren’t alone.
tal. All indications are that Elisse Walter will new ways to hasten the speed and expand the
12 13

8. Weekly
reach of their key financial messages. After all, to be widely credited should the company be
one could easily argue that Mr. Hastings stands able to keep the corporate raider at bay.
for full and fair disclosure while the SEC de-
Another important point to note—and one that
mands allegiance to the telegraph in the age of
lends this drama a certain sense of irony—is
the Internet.
that IR engagement via social media falls
Whether intentional or not, Mr. Hastings’ directly in line with what the SEC is trying
Facebook post made a compelling statement to accomplish in the Dodd-Frank era. As Mr.
about social media’s utility in the IR realm for Hastings’ amply demonstrated, it has the reach
the simple reason that it had a dramatic impact. to inform the widest possible swaths of the
His page has more than 246,000 subscribers investing public. It has the speed to ensure that
“ Another important point to note...is that IR
engagement via social media falls directly in
line with what the SEC is trying to accomplish
in the Dodd-Frank era.”
Even if the unlikely outcome comes to pass and fell swoop, public companies ought not to be
who facilitated a viral effect when he shared information reaches the marketplace in a time- Netflix is ultimately found to have stepped out- turned off to the myriad benefits of social me-
the record-breaking video view stats. They were ly fashion. Perhaps most important, it provides side regulatory boundaries, Mr. Hastings has dia engagement in the IR context. Not even the
rapidly disseminated amongst subscribers’ for two-way communications between share- provided us all with a salient reminder that it SEC can put the toothpaste back into the tube,
social networks, bloggers, analysts, and even holders and the companies they own. If there really is fine for a public company to discuss turn back the clock, and deny that social media
traditional journalists. The result was a jump are other media that can inform and empower material information on social media sites as are here to stay.
in stock price from under $70 a share to more investors with such effect, they aren’t yet on long as the company avails itself of traditional
If the Commission ends up making its case in
than $80—with the post being the only data my radar screen. disclosure options simultaneously. As such, the
court, it will likely learn that lesson the hard
point available for explaining the increase. answer moving forward is for public compa-
For all of these reasons, it’s hard to conclude way. Either way, it’s probably a good time for
nies to feel perfectly confident sharing mate-
As of this writing, the stock is trading around that Mr. Hastings’ Facebook post is anything the SEC to sell its typewriters. L
rial information on blogs, Facebook, Twitter, or
$89 a share, even with the SEC investigation other than what the framers of Reg FD envi- Richard S. Levick, Esq., President and CEO of LEVICK,
even YouTube—as long as the information has
somewhat dimming investors’ excitement. With sioned. At the same time, however, it is perfect- represents countries and companies in the highest-stakes
gone out via a news release, 8-K, or 10-Q first
Carl Ichan circling overhead (he now holds a 10 ly understandable that most public companies global communications matters—from the Wall Street
or at the same time.
crisis and the Gulf oil spill to Guantanamo Bay and the
percent stake in the company), the lasting spike will want to see how this case plays out before
Catholic Church.
created by Mr. Hastings’ very public post ought jumping headfirst into the social media waters. Despite the SEC’s misguided attempt to reign in
The good news here is that they don’t have to. Netflix, speech, and the Internet in one
14 15

9. The SEC Gets Its
Groove Back
Richard S. Levick, Esq.
Originally Published on Forbes.com

10. Weekly
It
won’t likely come as big news to dangers of High Frequency Trading and under-
Elisse Walter, the new interim head regulated Money Market Mutual Funds. Even
of the vv (SEC) who is replacing now, as critics begrudgingly admit that Schap-
Mary Schapiro, that the securities iro tightened the rules on those funds in 2010,
industry will be significantly transformed in they complain that the impact of the reform has
2013. For Walter, it’s going to be a continuing been eroded by industry lobbyists. The perni-
baptism by fire. cious influence of money and power in Wash-
ington, DC? Blame that on Schapiro too.
The transformation will be more decisive, per-
haps, than anything we’ve seen during the last Frankly, it’s all a little like criticizing Roosevelt
four turbulent years, in large part because of because he did not end the Great Depression in
the Dodd-Frank rule-making and implementa- his first term nor achieve real prosperity until
tion that now confront the SEC. As Christopher the war boom. In the same way, the jaundiced
Garcia observes, there are an “obscene” num- assessment of Schapiro lacks historical per-
ber of rules yet to be proposed, finalized, and spective. Interestingly, it’s the lawyers working
implemented—hundreds of them, with many closely with the SEC in recent years who have
having potentially significant implications for apparently maintained the more enlightened
the banks. The Volcker Rule is only the most perspective and done Schapiro the most jus-
obvious example, adds Garcia, a partner at tice—on and off the record—in their comments
Weil, Gotshal & Manges, LLP. on her star performance.
No doubt this looming sea change, along with In fact, she probably saved the SEC or, at least
the high drama of the post-2008 era, prompted as Garcia says, “steered it through its most dan-
a more focused evaluation of Schapiro than gerous period.” One lawyer reminds us that
typically greeted her predecessors upon their the full-impact of the SEC’s whistleblower
departures. Indeed, there has been a penchant program won’t be felt until 2013, and that the
among the pundits to focus on the shortcomings success of those dramatic incentives will then
of Schapiro’s tenure; on the Commission’s failure be proven. Yet that’s only one initiative. In
to address and solve the systemic problems that 2011, the Commission set a new agency record
were exacerbated by the economic crisis. for enforcement actions (735) and collected
$2.8 billion in penalties. And, at a time of ob-
Much of that criticism could not, in fact, be
sessive budgetary constraints, Schapiro played
more shortsighted.
her political cards to secure ample funding
The litany of criticism ranges from policy to from Congress.
enforcement. The Commission on Schapiro’s
Again, though, 2013 is the year the rubber
watch was blamed for failing to address the
meets the proverbial road and, to extend our
18 19

11. BLOGS worth following
Weekly
historical metaphor, Walter will play Truman Schapiro for salvaging the SEC from obsoles-
to Schapiro’s Roosevelt. The Dodd-Frank rule- cence are likewise keen in their support for Wal-
making is the most important challenge but ter. “She makes a lot of sense as a successor as
a host of other issues are also decisive. Flash there will not be a lot of getting up to speed nec-
Thought leaders Industry blogs
crashes will naturally be a hot-button topic. essary, given her experience, not only as a Com-
Amber Naslund Holmes Report
Also “of particular interest will be how the missioner of the SEC, but also as a senior execu-
brasstackthinking.com holmesreport.com
SEC deals with the loosening of the historical tive at FINRA and on the SEC staff,” says Thomas Amber Naslund is a coauthor of The Now Revolution. A source of news, knowledge, and career
The book discusses the impact of the social web information for public relations professionals.
restrictions on general solicitation and adver- McGonigle, chairman of the SEC Enforcement and how businesses need to “adapt to the new era
tising under Rule 506 of Regulation D as well as Practice Group at Murphy & McGonigle. of instantaneous business." NACD Blog
blog.nacdonline.org
the implementation of exemptions for crowd- Brian Halligan The National Association of Corporate Directors
Yet the new SEC chairman will need a par-
funding,” says Robert Steinberg,” a partner at hubspot.com/company/management/brian-halligan (NACD) blog provides insight on corporate
ticularly rare combination of distinct leader- HubSpot CEO and Founder. governanceand leading board practices.
Jeffer Mangels Butler & Mitchell LLP.
ship skills. First, the job will require tireless
Chris Brogan PR Week
“From a political perspective,” adds Steinberg, managerial oversight of the many daunting Chrisbrogan.com prweekus.com
Chris Brogan is an American author, journalist, PRWeek is a vital part of the PR and communications
“the Commission will have to deal with the and multifaceted tasks at hand, especially the industries in the US, providing timely news, reviews,
marketing consultant, and frequent speaker about
possibility of a 2-2 deadlock between the cur- Dodd-Frank rule-making. As Dennis Kelleher, social media marketing. profiles, techniques, and ground-breaking research.
rent Republican and Democratic Commission- President and CEO of Better Markets, advises, David Meerman Scott PR Daily News
ers until the Obama administration can name the chairman “must [also] get serious about davidmeermanscott.com prdaily.com
David Meerman Scott is an American online PR Daily provides public relations professionals,
another to the Commission.” regulating high-frequency trading, payment social media specialists and marketing
marketing strategist, and author of several books
for order flows, abusive practices, consolidated on marketing, most notably The New Rules of communicators with a daily news feed.
That’s not the only political issue brewing. The Marketing and PR with over 250,000 copies in
audit trails, and market transparency.” print in more than 25 languages.
SEC must grapple with some stiff inter-agency
competition as the Consumer Financial Pro- Second, the job will require vision, the kind Guy Kawasaki
BUSINESS Related
guykawasaki.com FastCompany
tection Bureau (CFPB) and the U.S. Commod- of vision that sees beyond the multiple crises
Guy Kawasaki is a Silicon Valley venture capitalist, fastcompany.com
ity Futures Trading Commission (CFTC) both of the day to a higher purpose; namely, the bestselling author, and Apple Fellow. He was one Fast Company is the world’s leading progressive
of the Apple employees originally responsible for business media brand, with a unique editorial
expand their Inside-the-Beltway profiles. That enactment of an agenda that tightly regulates marketing the Macintosh in 1984. focus on business, design, and technology.
gauntlet has already been thrown down. As a marketplace demonstrably in need of aggres-
Jay Baer Forbes
one Schapiro detractor wrote, the SEC’s “final- sive regulation—even as it encourages invest- jaybaer.com Forbes.com
izing…the Dodd-Frank derivatives provisions ment, growth, and job-creation. Jay Baer is coauthor of, “The Now Revolution: 7 Forbes is a leading source for reliable business
Shifts to Make Your Business Faster, Smarter and news and financial information for the Worlds
was painfully slow, in stark contrast with the More Social." business leaders.
Tall order. It’s our guess that, by December 31,
dynamism of the CFTC under Gary Gensler, Mashable
2013, Walter may be in for some of the same Rachel Botsman
which had far broader derivatives jurisdiction rachelbotsman.com mashable.com
kind of criticism that has faced Schapiro. And Social Media news blog covering cool new websites
to deal with.” Rachel Botsman is a social innovator who writes,
consults and speaks on the power of collaboration and social networks.
it will probably be just as unfair. L
and sharing through network technologies.
Given all these exigencies, it is painfully obvious
Richard S. Levick, Esq., President and CEO of LEVICK,
that the choice to replace Schapiro is crucial. Seth Godin
represents countries and companies in the highest-stakes
sethgodin.typepad.com
Here, many of the same lawyers who praise global communications matters—from the Wall Street
Seth Godin is an American entrepreneur, author
crisis and the Gulf oil spill to Guantanamo Bay and the and public speaker. Godin popularized the topic
Catholic Church. of permission marketing.
20

12. IN THE NEWS
Articles
PR Week | January 3, 2012
DC Unlocked
MSN Now | January 3, 2012
PR experts agree: The NRA Press Conference was a Disaster
Huffington Post | December 24, 2012
Wayne LaPierre Speech Was A Total Public Relations Disaster, Say PR Experts
Bernama | December 24, 2012
Social Media An Important Tool For Brand Promotion, Says Renowned Forbes Commentator
International Buisness Times | December 24, 2012
US Economy 2013: If 'Fiscal Cliff' Is Avoided, What About The Debt Ceiling?
PR Week | December 21, 2012
NRA Facebook and Twitter Blackout: Smart Crisis Comms or Social Media Fail?
THE URGENCY
OF NOW.