2023 Annual Seminar

2023 Annual Seminar of the Financial Lawyers Conference

December 15, 2022

APPLICATIONS MUST BE RECEIVED BY JANUARY 20, 2023

The Annual Seminar of the Financial Lawyers Conference for 2023 will take place at the Ojai Valley Inn in Ojai, California, over the weekend of March 17-19, 2023.  The topic of this year’s seminar is:

New Article 12 and Revisions to Article 9:
Welcoming the UCC to the World of Digital Assets,
Bundled Transactions, and Virtual Currencies

The Financial Lawyers Conference is pleased to announce that the 2023 Seminar will be led by two members of the Digital Assets Working Group of the Committee on the Uniform Commercial Code and Emerging Technologies, Charles W. Mooney, Jr., and Carla L. Reyes.

Charles Mooney is the Charles A. Heimbold, Jr., Professor of Law, Emeritus, at Penn Carey Law at the University of Pennsylvania.  He joined the faculty in 1986, and served as interim dean from August 1999 to March 2000.  His book Security Interests in Personal Property: Cases, Problems, and Materials (6th ed. 2016) is a widely adopted text used in law schools around the United States.  He was the Reporter for the Uniform Commercial Code Amendments (2022) (which includes the new Article 12) and is a member of the International Institute for the Unification of Private Law (UNIDROIT) working group on digital assets and private law.

Carla Reyes is an Assistant Professor of Law at the Southern Methodist University Dedman School of Law.  She joined the SMU faculty in 2020 after teaching stints at the Michigan State University College of Law and Stetson University College of Law.  She is a member of the UNIDROIT working group on digital assets and private law, an Associate Research Director for the Permanent Editorial Board of the Uniform Commercial Code, a Research Director for the Uniform Law Commission Technology Committee, and was an Advisor for the Uniform Commercial Code Amendments (2022).  She is the author of Creating Cryptolaw for the Uniform Commercial Code, 74 Wash. & Lee L. Rev. 1521 (2021), advocating the use of blockchain technology and smart contracts (a type of computer program frequently used in connection with blockchain technology) to form the basis of an Article 9 filing system that remedies many of the current system’s failures. 

The Uniform Commercial Code (UCC) has been enacted in all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands.  Since its widespread enactment in the 1960s, the UCC has been periodically revised to address changes in commercial practices.

In 2019, the Uniform Law Commission (ULC) and the American Law Institute (ALI) appointed a Joint Committee to consider whether changes to the UCC are advisable to accommodate emerging technologies such as artificial intelligence, cryptocurrency, blockchain, and non-fungible tokens (NFTs).  The Joint Committee conducted numerous meetings and, with the help of several small working groups, drafted proposed amendments to the UCC to deal not only with digital assets, but also “bundled” or “hybrid” transactions (i.e., transactions involving the sale or lease of goods together with the provision of services, licensing of information, or both) and virtual currencies.  Professor Mooney served as the Reporter for the Joint Committee, Professor Reyes served as an advisor to the Joint Committee, and Professors Mooney and Reyes served on the Digital Assets Working Group.

In mid-2022, ALI and ULC approved a new UCC Article 12, as a part of the Uniform Commercial Code Amendments (2022), to govern the transfer of property rights in certain intangible digital assets – defined in Article 12 as “controllable electronic records” – that have been created (or may in the future be created) using new technologies.  “Controllable electronic records” include only those electronic records that can be subjected to control, including, for example, certain types of virtual currency and NFTs.  In this context, control is the functional equivalent of “possession” of a controllable electronic record, and a necessary condition for protection as a good faith purchaser for value (a “qualifying purchaser”).  Article 12 allows a qualifying purchaser of a controllable electronic record to take its interest free of conflicting property claims, and provides a mechanism for evidencing certain rights to payment to the person that has control of the controllable electronic record.

The ALI and ULC also approved extensive amendments to UCC Article 9.  Some address the creation and perfection of security interests in controllable electronic records and in the rights to payment that are embedded in, or tethered to, controllable electronic records.  The amendments also redefine “chattel paper” and update Article 9 provisions applicable to this type of collateral.  The new definition and related revisions to Article 9 resolve uncertainties that arise in “bundled” or “hybrid” transactions, and provide a single rule for perfecting a security interest in chattel paper regardless of whether it is tangible (i.e., evidenced by writings) or electronic.  The amendments also include new definitions of “money,” “electronic money” and “tangible money” to address, among other things, the possibility that countries will authorize or adopt intangible tokens (e.g., bitcoin or central bank digital currencies (CBDCs)) as a medium of exchange.

To protect parties’ expectations and give parties time to adjust to the amendments, the ALI and ULC recommend that states adopt a uniform “adjustment date” of July 1, 2025.  If the effective date of the amendments in a particular state occurs after July 1, 2024, the ALI and ULC recommend that the “adjustment date” occur one year after the amendments go into effect in that state.

Recent events evidence the need for uniform laws governing emerging technologies.  In June 2022, a court in the British Virgin Islands ordered Three Arrows Capital (3AC), a cryptocurrency hedge fund, to liquidate.  3AC reportedly borrowed billions of dollars to fund its trading, and owed more than $650 million to crypto-currency broker Voyager Digital.  Voyager itself filed for chapter 11 in July 2022.  Also in July 2022, one month after pausing all transfers and withdrawals, cryptocurrency lender Celsius Network filed for chapter 11 and scheduled $4.7 billion of liabilities to users who had deposited cryptocurrency digital assets with the company.  Cryptocurrency exchange FTX, cryptocurrency hedge fund Alameda Research, and over 130 affiliated companies filed for chapter 11 on November 11, 2022, after a tumultuous week in which a rival exchange, Binance, backed out of a deal to acquire FTX.  On November 28, 2022, a cryptocurrency lender that was bailed out by FTX earlier in the year, BlockFi, filed for chapter 11. 

Ripples in the cryptocurrency brokerage and lending industry likely will continue to spread in the months, if not years, to come.  Yet the number of people and companies that use or invest in cryptocurrency and other digital assets is growing.  For example, you can now use certain cryptocurrencies to buy movie tickets and popcorn at AMC Theaters, purchase a basketball jersey from the Dallas Mavericks, or donate to The Metropolitan Museum of Art.  Given the increased role that cryptocurrencies are likely to have in the future, attorneys and insolvency professionals should familiarize themselves with these recent revisions to the UCC relating to transfers, securitization and perfection of security interests in emerging technologies, as well as other recent revisions to Article 9.

A few weeks before the seminar, FLC will email attendees written course materials, including discussion questions and problems that will form the basis for the seminar discussions, as well as assigning each attendee to a specific issue.  Because the seminar materials will be distributed via email, please be sure to provide your email address on your seminar application.

The weekend will include approximately eleven hours of roundtable discussion, which has been approved for Minimum Continuing Legal Education credit by the State Bar of California.

We are delighted that the seminar will again be held at the

OJAI VALLEY INN

905 Country Club Road

Ojai, California 93023

Nestled within a rare coastal valley on 220-oak studded acres, the iconic Ojai Valley Inn offers an abundance of active and peaceful pleasures.  Amenities include a legendary golf course, 31,000 square foot Spa Village, Artist Cottage & Apothecary, apiary and immersive beekeeping experience, The Farmhouse at Ojai, multiple pools, and seven unique dining outlets with settings that range from fast-casual, poolside, to fine dining.  The quaint ranch town is within walking distance with shops, restaurants and local wineries to explore.  Given the wealth of activities available at the Ojai Valley Inn, participants and their guests will have plenty of stimulating options when not discussing recent developments in commercial law.

FLC is making comprehensive arrangements for fine dining and entertainment throughout the seminar weekend.  Friday evening will feature a cocktail reception and dinner buffet, followed by conversation, socializing, poker and games in the hospitality suite.  Both a buffet breakfast and lunch will be served on Saturday.  On Saturday evening, FLC will host a cocktail reception, followed by FLC’s traditional awards dinner and, after that, more conversation, socializing, poker and games.

Attendees and guests will have free time Saturday afternoon.  Win trophies on the links by participating in FLC’s annual golf tournament,[1] indulge in the world-class, full service spa,[2] explore Ojai, or simply lounge at the pool or stroll the property.

FLC’s policy on attendance by children is described in the rules established by the Board of Governors (the “Rules”).  Child care and babysitting arrangements can be made directly through the hotel concierge.

The preliminary schedule for the seminar weekend is as follows:

Check-in time on Friday is 4:00 pm, although some rooms may be available earlier.  Luggage storage will be provided in the lobby if your room is not available when you arrive for the seminar.

The standard registration fee for the seminar is $3,400 for an individual or $3,900 for a couple.  The registration fee for optional early arrival on Thursday, March 16, 2023, is $4,035 for an individual or $4,535 for a couple.  The registration fee covers all of the following:  educational program and materials; room and tax; in-room coffee/tea; hosted cocktail receptions on Friday and Saturday evenings; buffet dinners on Friday and Saturday; buffet breakfasts on Saturday and Sunday; buffet lunch on Saturday (or box lunch for golfers); three seminar breaks with snacks and beverages; nightly hospitality suites on Friday and Saturday; 24-hour valet and self-parking; wi-fi access in all guest rooms, pool areas and the lobby; nightly turndown service (including housekeeping gratuities); full access to the fitness center and daily mind & body classes; select newspapers and magazines available through an in-room iPad (daily newspaper delivered upon request); unlimited use of tennis courts (reservations required); business center featuring Apple and Dell computers; and complimentary resort Linus bicycles (subject to availability).

There will be a $145 registration fee for each child aged three and up who will be attending one or more of the meals that are open to children (Saturday breakfast, Saturday lunch and Sunday breakfast).

Incidental charges (e.g., bellman services, room service, mini bar charges, hotel restaurants and bars, gift shop purchases, greens fees for Saturday’s golf tournament, extracurricular activities and spa fees) will be charged to the attendees.

If the seminar is oversubscribed, attendance will be determined by the Rules.

Please note that once an application is submitted, it may not be withdrawn.  Refunds will be subject to paragraph 7 of the Rules.

Please register for the seminar online, at www.financiallawyers.org.  If you prefer to submit a registration form by mail or email, please contact our administrator, Leslie Medina, at info@financiallawyers.org to request a form.

APPLICATIONS MUST BE RECEIVED BY JANUARY 20, 2023

We look forward to seeing you at the seminar.  This is sure to be an educational, fulfilling and enjoyable weekend!

Very truly yours,

John Tedford

Vice President and Seminar Chair

Click HERE for the complete event rules

[1] We have reserved a block of tee times for the golf tournament.  Greens fees are $135 per person for 18 holes.  Skill and aptitude is optional.

[2] Attendees should make reservations with the spa directly.  OVI is offering a 10% discount off 2023 Spa Ojai menu pricing for 60-minute treatment services or more, Sunday through Friday only, excluding merchandise and Saturday treatment services.

[3] Check-out time on Sunday is 12:00 pm.  Based on availability, late check-out may be requested on the day of departure.