The week’s news included; J&J to trial coronavirus vaccine by September, Supreme Court rules on landmark Morrisions data breach case, Amazon wins lawsuit against Coty, Houseparty alleged data breach,
Below are our top 10 stories that you need to know about. Be sure to check our twitter page, Facebook page and Instagram Page, for regular posts of important headlines. Get all the important stories and insights straight into your inbox by subscribing to our mailing list here.
Opinion articles of the week:
- BBC News – Will coronavirus reverse globalisation?
- The Lawyer – How coronavirus is affecting the qualification of lawyers.
- City A.M. – A home working revolution? Not so fast, people love the office
1. J&J BEGIN TRIAL ON CORONAVIRUS VACCINES
Johnson and Johnson has announced that it will begin human tests of its coronavirus vaccine by September. The pharmaceutical giant has invested over $1 billion along with the US Department of Health to co-fund vaccine research. The clinical results of these phase 1 tests will be available by the end of 2020. If these tests are successful, they could be available to treat patients as early as 2021. J&J is planning to produce over 1 billion doses of the vaccine and these would be produced on a “not-for-profit basis”. Typically, vaccines are developed in between five to seven years. Pharmaceutical firms have been working closely with regulators to try and achieve this within 12 months.
2. UNEMPLOYMENT FIGURES
The number of unemployment claims in the US has doubled amid the coronavirus outbreak. 6.6 million people more applied for unemployment benefits. Many companies have had to dismiss staff after numerous states banned public gatherings and some went into total lockdown. In the past two weeks alone, over 10 million people have filed for unemployment benefits in the US. Furthermore, the volume of applications is overwhelming the systems so many people have not yet been able to submit applications. In the UK, 950,000 people have applied for universal credit since the country went into lockdown. This is nearly 10 times the usual volume and the government have shifted staff from different departments to cope with the increased volume in claims.
3. MORRISONS SUPREME COURT CASE
The Supreme Court has held that Morrisons was not vicariously liable for a data leak committed by a rogue employee. In 2013, a senior internal auditor at the supermarket posted the personal data of 100,000 staff online. This was in retaliation against the company for disciplinary action he had faced. A group action lawsuit was brought against the supermarket by 5,000 affected employees. For employers to be vicariously liable the crime must be committed by the employee while acting in their “field of activities”. As the employee committed an unauthorised act, the Supreme Court unanimously held that Morrisons cannot be held vicariously liable for his actions. The employee received an eight-year jail sentence for the breach.
4. A TALE OF TWO MARKETS
One industry fending off a covid-19 downturn has been supermarkets. This has been fuelled by weeks of rampant stockpiling by shoppers. Customers spent a staggering £1.9 billion in the few weeks before the coronavirus lockdown. Shoppers made an additional in 79 million trips in the month until 21 March. Supermarkets have ramped up deliveries and staff numbers in order to cope with the increased numbers. Sales of all sorts of products soared in this period, notably frozen food sales up 84%. Ocado was the biggest gainer seeing sales soared 12.5% in the period. The online supermarket had to shut down for a few days as its website was overwhelmed with orders.
Unfortunately, UK stock markets tell a different tale. They have posted their worst quarter since 1987. In 2020 alone, the FTSE 100 has lost over 25% of its value, despite a 15% recovery since the UK went into lockdown. The FTSE 250 is down over 30% this year alone, its worst quarter ever. Some analysts suggest however, that the worst is yet to come for markets. Most losses have been driven by the decline in the retail, leisure and travel industries. These have been worst affected by the coronavirus outbreak. With analysts fearing many more business collapses, the stock markets could take a further nosedive.
5. HIGH STREET STRUGGLES
There are set to be two more major business victims of the covid-19 outbreak, Debenhams & Vapiano. Debenhams is set to fall into administration and restructure its business. The retailer already shut 22 stores this year after falling into administration last year. Like many high street retailers, Debenhams is burdened with huge overheads and mounting debt. With landlords and creditors all in need of payment, a restructuring may be the only way to keep the business alive. It is reviewing potential restructuring options.
Restaurant chain Vapiano has applied for insolvency proceedings after it failed to reach a rescue deal with shareholders and creditors. The German based restaurant which serves salads, pizza and pasta has been struggling. The share price of the parent company Vapiano SE has tanked over 90% in the past year alone. The insolvency applies to chains operated by Vapiano, but international franchisees however, are currently not affected by the insolvency.
6. LABOUR LEADERSHIP
Sir Keir Starmer has been elected as successor to Jeremy Corbyn as leader of the Labour Party. He won with over 56.2% of the votes beating Rebecca Long-Bailey and Lisa Nandy in the first round. Rebecca Long-Bailey came in second with just 27.6% of the vote. Starmer is no doubt more centrist than Jeremy Corbyn, under whose leadership the Labour Party shifted heavily towards the left. Corbyn’s shift to the left brought no great success. The labour party has lost four elections in a row with two of those losses under Jeremy Corbyn. Starmer undoubtedly has a mountain to climb given the landslide victory enjoyed by the Conservatives in the last election. Angela Rayner was selected as deputy leader of the party. Starmer is in the process of selecting his shadow cabinet, in which his election rivals, Long-Bailey and Nandy, are expected to hold positions.
7. OIL PRICES
Oil prices posted their worst quarter in history, falling over 65% in the year so far. Last Tuesday, Brent crude was trading at just $22.71 a barrel. The historic lows have been driven by a price war between OPEC members over production, further compounded by the coronavirus outbreak. Demand for oil has tanked as many countries have gone into total lockdown and many have banned non-essential travel. While Saudi Arabia and Russia aim to increase production collectively by over 3 million barrels per day in April. There is fear that April could be even worse. Meanwhile oil companies are due to see billions in losses due to this cocktail of problems. Royal Dutch Shell secured a £10 billion loan facility to help tide it over. How quickly the oil industry can bounce back remains to be seen.
8. AMAZON WINS LEGAL BATTLE
Amazon has won a European lawsuit against cosmetics company Coty over its listing of unlicensed Davidoff perfume. Coty’s German arm brought the case to the German Courts but it was referred to the European Court of Justice. Coty claimed Amazon had infringed on its trademark. It claims third party sellers used Amazon Marketplace to sell perfume bottles which were not licensed to be sold in the EU. Amazon’s Marketplace charges sellers to use Amazon’s listing, storage and distribution services. The ECJ however, did not deem this to be a trademark infringement on the part of Amazon. Simply stocking of goods without the aim of offering the goods for sale and without knowledge the products were unlicensed is not an infringement. This has significant implications for ecommerce platforms.
9. HOUSEPARTY DATA BREACH
Many users of the viral video-calling app Houseparty claim they have been hacked but the founders deny any breach. The app gained significant popularity at the outset of the coronavirus lockdown. Last week however, numerous users took to twitter, complaining they’ve had various accounts hacked and money stolen after downloading the app. There has been however, no concrete evidence of any breaches and its owners Epic Games are stressing this. They argue the claims of the breach are a conspiracy to harm Houseparty and have offered a $1 million bounty for information supporting this theory. Houseparty assured users all accounts are safe, and no accounts have been compromised.
Tech Crunch however, outlines the worrying amount of personal data collected by Houseparty and the privacy issues this raises.
10. CAESAR’S RECEIVES RECORD FINE
Casino company Caesar’s Entertainment has been fined a record £13 million due to failures in its VIP schemes. The company offered perks to VIPs, encouraging them to bet large amounts. One VIP lost £323,000 in one year despite evident signs of addiction. The Gambling Commission has also launched a wider investigation into gambling VIP schemes. Caesar’s also had inadequate AML practices, as it failed to check source of funds or political exposure of customers. Three managers at Caesars Entertainment are also to lose their license to operate a gambling business. The Commission is keen to show its teeth after facing staunch criticism for inadequately protecting customers. Customers have lost millions due to addiction and gambling firms failing to adhere to regulations. Only last month, Betway was fined £11.6 million for its inadequate protections.