Commercial Litigation Update

• Several areas of federal criminal prosecution, including health care fraud, have been pulled under the umbrella of the new National Fraud Enforcement Division (“NFED”) of the Department of Justice (“DOJ”), with the stated goal of “rapidly and substantially” increasing resources and creating a robust litigating division.
• DOJ is centralizing enforcement priorities by deputizing local U.S. Attorney’s Offices, and encouraging state and local governmental fraud-fighting authorities to align with the NFED.
• Priority areas of the NFED are yet to be announced, although we expect them to align with the priorities targeted by the Trump Administration in its other enforcement capacities, including “illegal” DEI, weaponization, and others.

Key Takeaways: 

• State Attorneys General (AGs) Are Stepping Up: With reduced federal enforcement staffing, state AGs are expanding their budgets, hiring former federal prosecutors, and taking the lead in health care fraud investigations.
• Medicaid Takes Center Stage: As federal enforcement focuses on Medicare, state Medicaid Fraud Control Units are prioritizing Medicaid fraud, creating a shift in enforcement focus and risk profiles for health care companies.
• Proactive Compliance Is Critical: Companies must prioritize internal complaint management, monitor their external reputation, and engage experienced local counsel to navigate the complexities of state and federal enforcement.

In this episode of Speaking of Litigation, Epstein Becker Green attorneys Zachary Taylor, Sarah Hall, and Jeremy Avila discuss the implications for general counsel regarding the expansion of state-level health care enforcement and explore how companies can proactively manage risk in this evolving environment.

On March 10, 2026, the Department of Justice (“DOJ”) announced its “first ever” department-wide Corporate Enforcement and Voluntary Self-Disclosure Policy (“CEP”) for all criminal cases.

On March 4, 2026, Nippon Life Insurance Company of America (“Nippon Life”) filed suit against OpenAI Foundation and OpenAI Group PBC in U.S. District Court for the Northern District of Illinois—claiming that a covered employee’s zealous use of the artificial intelligence (“AI”) tool, ChatGPT, for pro se litigation caused the chatbot to engage in tortious interference with a contract, abuse of process, and the unlicensed practice of law.

A federal judge recently concluded that the defendant in a white-collar securities dispute may not claim that his conversations with the artificial intelligence (“AI”) tool, Claude, are privileged. Litigators and clients now must take heed.

Kalshi, a federally regulated prediction market, is betting big on its business model. Whether that bet pays off depends on how courts resolve a growing conflict between federal commodities regulation and state gambling laws.

Our colleagues Thomas Jaworski, Elena M. Quattrone, and Maurice Wells published an Insight that will be of interest to readers involved in white collar defense: “Recalibrating Economic Crime Sentencing: The U.S. Sentencing Commission’s Proposed Reforms to Section 2B1.1 and What They Mean for the Defense Bar.”

What You Need to Know:

The U.S. Sentencing Commission (the “Commission”) has proposed amendments to federal fraud sentencing guidelines and is soliciting comments from the public.

• Simplified Loss Table: The proposed amendments reduce the 16-tier loss table to eight broader tiers, aiming to simplify sentencing and reduce disputes over marginal loss amounts.
• Focus on Culpability and Harm: New guidelines emphasize non-economic victim harm (e.g., emotional trauma) and introduce mitigating factors for defendants acting under coercion or showing early remediation.
• Retroactivity and Public Input: The Commission is considering retroactive application of these changes and invites public comments by February 10, 2026, ahead of a May 1, 2026, deadline for Congressional submission.

Read the full Insight here.

Artificial intelligence is moving beyond standalone large language model wrappers toward collections of specialized AI agents that reason, act, and collaborate to achieve complex outcomes. This multi-agent vision, articulated in Google’s Introduction to Agents whitepaper,[1] marks a subtle, but seismic, shift in how businesses will deploy AI; and spotlights nuanced legal challenges that litigators and in-house counsel should start addressing now.

[1] https://www.kaggle.com/whitepaper-introduction-to-agents (last visited January 21, 2026).

Contrary to the presupposition of many, the U.S. Supreme Court did not render a decision on Friday resolving the question of the president’s authority to impose tariffs through executive orders and related questions concerning the extent to which congressional mandates should be required.

Instead, the Court issued a 5–4 decision in the case of Bowe v. United States. Resolving a substantial split among the circuit courts, the Supreme Court held, per Justice Sotomayor, that a provision of the Antiterrorism and Effective Death Penalty Act (AEDPA) requiring federal courts to dismiss certain previously raised habeas corpus claims applies only to state prisoners’ applications.

In the wake of this country’s longest federal shutdown, federal courts were facing unprecedented decision-making whether to stay civil proceedings implicating federal employees and agencies.

The Anti-Deficiency Act prohibits federal agencies from spending beyond their allotted funding and simultaneously restricts federal employees from working on a volunteer basis. The Act provides, in relevant part:

An officer or employee of the United States Government or of the District of Columbia government may not accept voluntary services for either government or employ personal services exceeding that authorized by law except for emergencies involving the safety of human life or the protection of property.

31 U.S.C. § 1342 (emphasis added).

During lapses in federal funding, voluntary services are only authorized in very limited circumstances, but the parameters of the “safety of human life” or “protection of property” exceptions have not been uniformly defined nor applied across the courts.