Posts Tagged: "Contract Law"

In an appeal from the United States Court of Federal Claims (Claims Court), the United States Court of Appeals for the Federal Circuit (CAFC) last week affirmed a decision granting summary judgment in favor of the U.S. government with respect to a nonexclusive trademark license between the Department of the Army and an apparel company (Authentic Apparel Group, LLC v. United States). In the March 4 opinion, the CAFC agreed with the Claims Court that a license agreement’s provision giving the Army broad approval discretion over Authentic’s requests to use the Army’s trademarks on proposed products or marketing materials was not at odds with the principles of trademark law. The CAFC also held that Authentic did not present any legal or factual reasons to deviate from a plain reading of the license agreement’s exculpatory clauses.

Starting your own business is exciting. Finding the right partner to share the same vision is vital for the company’s future success. However, people don’t always see eye to eye when it comes to important details like finances, marketing, and a strategic business plan. Throw in a global pandemic to turn the economy upside down, and things become even more complicated. Lately, business partners have had to face unusually significant challenges due to the effects of the COVID-19 pandemic on business operations and revenue. With uncertainty continuing to loom over our economy’s future, those challenges are likely here to stay for a while. Fortunately, some companies have been able to find relief during this stressful time through government stimulus checks, insurance claims and other types of aid. On the other hand, many have faced roadblocks, causing disagreements between partners and their visions for the future. The added disruption brought on by COVI9-19 has led some to a business divorce, which is more easily managed when there are clear contractual agreements in place. Without such comprehensive agreements between owners, businesses are in danger of failing.

As outside general counsel to over 150 emerging growth companies in recent years, as well as to their venture capital and growth equity investors, and as someone who represents buyers and sellers in M&A transactions, I am often asked how to protect businesses from interruption to their key customer and supplier relationships. Specifically, in the age of COVID-19, now characterized by the World Health Organization as a “global pandemic,” I am being asked whether a counter-party can trigger a “material adverse change” clause to terminate a contract.

It continually amazes me that many business folks who negotiate tons of IP license agreements, fail to understand the difference between covenants, representations, and warranties that are “standard” in many such agreements.  Well, that is not too surprising.  What is very surprising, however, is that many of their lawyers fail to appreciate the differences as well!  Many think the terms are synonymous and thus use them interchangeably. They are not.  So, for those of you tired of faking the funk, here is some (either fresh or refresher) Contracts 101!

The Federal Circuit has agreed to expeditiously hear an appeal from Dodocase VR, Inc. v. Merchsource, LLC No. 17cv7088 (N.D. Cal.) (“Dodocase”) in which the district court determined that a forum selection clause could not be overridden to allow a patent validity challenge at the PTO without breaching the contract containing the clause.  The court issued a preliminary injunction ordering the withdrawal of the petitions MerchSource had filed with the Patent Trial and Appeal Board (PTAB).  Dodocase at 24.  In its arguments, MerchSource strongly relied on the public’s interest in permitting the PTO to correct its mistakes.  This interest, however, was not found to outweigh the policy favoring enforcing parties’ agreed upon selection of a forum.  Id. at 17.

The basement inventor is increasingly rare, although I am old enough (and lucky enough) to know several. Invention in the “real world” is often a messy, team effort of multiple inventors, employers, contracts, research agreements, and funding agreements. As the complexity of invention multiplies, so do opportunities for unintentionally losing or jeopardizing intellectual property rights… There is often more than meets the eye when it comes to ownership of inventions. The benefits of collaboration far outweigh the disadvantages. However, you can take steps to ensure a smooth collaboration by keeping a few legal principles in mind…

Legal protection for databases in Canada is, perhaps surprisingly, a little convoluted. In some jurisdictions, unique database rights have been legislated (e.g. the EU). This is not yet the case in Canada where protection instead comes from a patchwork of rights provided by different regimes. Traditional intellectual property (“IP”) rights provide some protection, but with sufficient gaps to make exclusive reliance on IP inadvisable… In the decision, the Competition Tribunal found that the information in the MLS database does not attract copyright protection. The decision sets out the Tribunal’s attempt to apply the relevant copyright case law to determine whether copyright subsists in the overall arrangement of information in the MLS database.

There are not many things an employer can do to prevent unfettered competition by a former employee. B&P Section 16600 states that “every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.” The statute provides three exceptions, none of which apply to the typical employer/employee relationship: (1) a person who sells the goodwill of a business or sells substantially all of its operating assets may lawfully agree to refrain from carrying on a similar business; (2) a partner may, upon the anticipation of the partnership dissolution or disassociation from the partnership, lawfully agree not to carry on a similar business; and (3) any member of a limited liability company may lawfully agree not to carry on a similar business.

A lot of law students and young attorneys aim to get into the field of “entertainment law.” Today, entertainment law is more of a combination of contract law, intellectual property law, accounting and just about every other area of law for which an individual or company requires legal services. So, if someone wants to work specifically in entertainment law, there are a few things he or she needs to do.