Too Big to Fail — U.S. Banks’ Regulatory Alchemy: Converting an Obscure Agency Footnote into an “At Will” Nullification of Dodd-Frank’s Regulation of the Multi-Trillion Dollar Financial Swaps Market

The multi-trillion-dollar market for, what was at that time wholly unregulated, over-the-counter derivatives (“swaps”) is widely viewed as a principal cause of the 2008 worldwide financial meltdown. The Dodd-Frank Act, signed into law on July 21, 2010, was expressly considered by Congress to be a remedy for this troublesome deregulatory problem. The legislation required the swaps market to comply with a host of business conduct and anti-competitive protections, including that the swaps market be fully transparent to U.S. financial regulators, collateralized, and capitalized. The statute also expressly provides that it would cover foreign subsidiaries of big U.S. financial institutions if their swaps trading could adversely impact the U.S. economy or represent the use of extraterritorial trades as an attempt to “evade” Dodd-Frank. In July 2013, the CFTC promulgated an 80-page, triple-columned, and single-spaced “guidance” implementing Dodd-Frank’s extraterritorial reach, i.e., that manner in which Dodd-Frank would apply to swaps transactions executed outside the United States. The key point of that guidance was that swaps trading within the “guaranteed” foreign subsidiaries of U.S. bank holding company swaps dealers were subject to all of Dodd-Frank’s swaps regulations wherever in the world those subsidiaries’ swaps were executed. At that time, the standardized industry swaps agreement contemplated that, inter alia, U.S. bank holding company swaps dealers’ foreign subsidiaries would be “guaranteed” by their corporate parent, as was true since 1992. In August 2013, without notifying the CFTC, the principal U.S. bank holding company swaps dealer trade association privately circulated to its members standard contractual language that would, for the first time, “deguarantee” their foreign subsidiaries. By relying only on the obscure footnote 563 of the CFTC guidance’s 662 footnotes, the trade association assured its swaps dealer members that the newly deguaranteed foreign subsidiaries could (if they so chose) no longer be subject to Dodd-Frank. As a result, it has been reported (and it also has been understood by many experts within the swaps industry) that a substantial portion of the U.S. swaps market has shifted from the large U.S. bank holding companies swaps dealers and their U.S. affiliates to their newly deguaranteed “foreign” subsidiaries, with the attendant claim by these huge big U.S. bank swaps dealers that Dodd-Frank swaps regulation would not apply to these transactions. The CFTC also soon discovered that these huge U.S. bank holding company swaps dealers were “arranging, negotiating, and executing” (“ANE”) these swaps in the United States with U.S. bank personnel and, only after execution in the U.S., were these swaps formally “assigned” to the U.S. banks’ newly “deguaranteed” foreign subsidiaries with the accompanying claim that these swaps, even though executed in the U.S., were not covered by Dodd-Frank. In October 2016, the CFTC proposed a rule that would have closed the “deguarantee” and “ANE” loopholes completely. However, because it usually takes at least a year to finalize a “proposed” rule, this proposed rule closing the loopholes in question was not finalized prior to the inauguration of President Trump. All indications are that it will never be finalized during a Trump Administration. Thus, in the shadow of the recent tenth anniversary of the Lehman failure, there is an understanding among many market regulators and swaps trading experts that large portions of the swaps market have moved from U.S. bank holding company swaps dealers and their U.S. affiliates to their newly deguaranteed foreign affiliates where Dodd- Frank swaps regulation is not being followed. However, what has not moved abroad is the very real obligation of the lender of last resort to rescue these U.S. swaps dealer bank holding companies if they fail because of poorly regulated swaps in their deguaranteed foreign subsidiaries, i.e., the U.S. taxpayer. While relief is unlikely to be forthcoming from the Trump Administration or the Republican-controlled Senate, some other means will have to be found to avert another multi-trillion-dollar bank bailout and/or a financial calamity caused by poorly regulated swaps on the books of big U.S. banks. This paper notes that the relevant statutory framework affords state attorneys general and state financial regulators the right to bring so-called “parens patriae” actions in federal district court to enforce, inter alia, Dodd- Frank on behalf of a state’s citizens. That kind of litigation to enforce the statute’s extraterritorial provisions is now badly needed

Genetic Testing to Inform Epilepsy Treatment Management From an International Study of Clinical Practice

IMPORTANCE: It is currently unknown how often and in which ways a genetic diagnosis given to a patient with epilepsy is associated with clinical management and outcomes. OBJECTIVE: To evaluate how genetic diagnoses in patients with epilepsy are associated with clinical management and outcomes. DESIGN, SETTING, AND PARTICIPANTS: This was a retrospective cross-sectional study of patients referred for multigene panel testing between March 18, 2016, and August 3, 2020, with outcomes reported between May and November 2020. The study setting included a commercial genetic testing laboratory and multicenter clinical practices. Patients with epilepsy, regardless of sociodemographic features, who received a pathogenic/likely pathogenic (P/LP) variant were included in the study. Case report forms were completed by all health care professionals. EXPOSURES: Genetic test results. MAIN OUTCOMES AND MEASURES: Clinical management changes after a genetic diagnosis (ie, 1 P/LP variant in autosomal dominant and X-linked diseases; 2 P/LP variants in autosomal recessive diseases) and subsequent patient outcomes as reported by health care professionals on case report forms. RESULTS: Among 418 patients, median (IQR) age at the time of testing was 4 (1-10) years, with an age range of 0 to 52 years, and 53.8% (n = 225) were female individuals. The mean (SD) time from a genetic test order to case report form completion was 595 (368) days (range, 27-1673 days). A genetic diagnosis was associated with changes in clinical management for 208 patients (49.8%) and usually (81.7% of the time) within 3 months of receiving the result. The most common clinical management changes were the addition of a new medication (78 [21.7%]), the initiation of medication (51 [14.2%]), the referral of a patient to a specialist (48 [13.4%]), vigilance for subclinical or extraneurological disease features (46 [12.8%]), and the cessation of a medication (42 [11.7%]). Among 167 patients with follow-up clinical information available (mean [SD] time, 584 [365] days), 125 (74.9%) reported positive outcomes, 108 (64.7%) reported reduction or elimination of seizures, 37 (22.2%) had decreases in the severity of other clinical signs, and 11 (6.6%) had reduced medication adverse effects. A few patients reported worsening of outcomes, including a decline in their condition (20 [12.0%]), increased seizure frequency (6 [3.6%]), and adverse medication effects (3 [1.8%]). No clinical management changes were reported for 178 patients (42.6%). CONCLUSIONS AND RELEVANCE: Results of this cross-sectional study suggest that genetic testing of individuals with epilepsy may be materially associated with clinical decision-making and improved patient outcomes

Temporary feeding tube dependency in pediatric patients: a retrospective analysis of risk factors and preventative practices

Background & Aims: Prolonged temporary tube feeding places pediatric patients at risk of tube dependency. This chart audit aimed to identify current temporary tube feeding practice within an Australian tertiary hospital, risk factors of prolonged temporary tube feeding, and the likelihood of high risk patients receiving tube dependency preventative practices. Methods: A retrospective chart audit was conducted of the medical records of 187 pediatric inpatients who had temporary feeding tubes placed in an Australian tertiary hospital between November 2014 and March 2017. Information was collected on patient demographics and tube feeding practices. The Kaplan Meier estimate, Cox regression and logistic regression were used to determine the median time until feeding tube removal, predictors of prolonged temporary tube feeding, and the relationship between these predictors and utilization of preventative practices. Results: The Kaplan Meier estimate of median tube feeding duration was 6.43 months (95% CI: 5.17 - 7.90). Predictors of prolonged tube feeding were prematurity (p = 0.003), feeding difficulties requiring speech pathology referral (p = 0.002), and referral for long-term feeding tubes (p = 0.002). There was a low prevalence of preventative clinical practices including documentation of tube exit plans (5.3%, n = 10) and referral for long-term feeding tubes (27.3%, n = 51). Exhibiting risk factors for prolonged tube feeding did not increase the likelihood of receiving preventative clinical practices. Conclusions: The prolonged duration of temporary tube feeding within this sample highlights the need for improved utilization of tube dependency preventative practices within high risk groups

Predictors of recurrence in pheochromocytoma

Background. The recurrence rate of pheochromocytoma after adrenalectomy is 6.5-16.5%. This study aims to identify predictors of recurrence and optimal biochemical testing and imaging for detecting the recurrence of pheochromocytoma

NF-κB plays a major role during the systemic and local acute inflammatory response following intestinal reperfusion injury

1. The nuclear translocation of transcription factors may be a critical factor in the intracellular pathway involved in ischaemia/reperfusion (I/R) injury. Here, we examined whether NF-κB and AP-1 participated in the cascade of events leading to TNF-α production, neutrophil recruitment, tissue injury and lethality following intestinal I/R. 2. The superior mesenteric artery (SMA) of mice was made ischaemic for 60 min followed by 30 min of reperfusion. The effects of NF-κB and AP-1 were studied by the administration of the thioredoxin inhibitor, MOL-294 (methyl 4-hydroxy-4-(8-methyl-1,3-dioxo-2-phenyl-2,3,5,8-tetrahydro-1H-[1,2,4]triazolo[1,2-a]pyridazin-5-yl)but-2-ynoate), and the AP-1 inhibitor, PNRI-299 (N-benzyl-2-(3-cyanophenyl)-1,3,7-trioxo-2,3,7,8-tetrahydro-1H-[1,2,4]triazolo[1,2-a]pyridazine-5-carboxamide). After I/R, there was increase of translocation of NF-κB, but not of AP-1, in the intestine and lungs, as assessed by a gel shift assay. 3. Treatment with MOL-294 inhibited the increase in vascular permeability, neutrophil accumulation, hemorrhage and proinflammatory cytokine levels, induced by intestinal I/R injury in the intestine. In the lungs, MOL-294 partially inhibited edema formation, TNF-α production, but did not alter neutrophil recruitment. 4. Treatment with MOL-294 inhibited reperfusion-associated lethality, an effect likely to be secondary to the inhibition of systemic TNF-α levels. PNRI-299 had no effects on the inflammatory changes or lethality induced by I/R injury. 5. Our results point to an important role for NF-κB in triggering endogenous proinflammatory networks during intestinal I/R injury. Inhibition of NF-κB prevents tissue injury and lethality, and this was associated with inhibition of TNF-α production and decrease in neutrophil recruitment