A post on Gray Reed’s Energy & the Law blog discusses the question: Under Louisiana law, does the operator’s bad faith preclude recovery for the non-operator’s breach of a joint operating agreement if the operator caused the non-operator to breach the JOA but did not itself breach?

Charles Sartain summarizes the background of Apache Deepwater, LLC v. W&T Offshore, Inc., a conflict between parties to a joint operating agreement for operations on offshore deepwater wells.

The case was complicated by conflicting provisions in the JOA.

Read the article.

The China Law Blog has published part one of an expected series of posts setting out exactly what foreign companies should do (and not do) to protect their intellectual property in China.

The author, Dan Harris of Harris Bricken, tells the story of a prospective client who sought help because a Chinese manufacturer he was working with on a product started selling a new product that happened to have the same features and functions as the product the American developer had submitted to the manufacturer.

Harris’ firm told the prospective client not much could be done because the nondisclosure agreement with the manufacturer was worthless in China. And U.S. patents won’t provide much practical protection, either.

The firm’s lawyers explained that the developer would have been better off if he had an NNN agreement —non-use, non-disclosure, and non-circumvention — that would be enforceable in a Chinese court with jurisdiction over the Chinese defendant. .

Read the article.

A California Court granted a defendant’s motion to compel arbitration based on a duly formed and consented arbitration clause via a “clickwrap” agreement, despite the plaintiff’s argument that no contract was ever formed because the purpose of the contract was to facilitate the selling and distribution of marijuana, which is illegal under federal law.

A post by Womble Bond Dickinson describes a case in which the defendant was hit with a putative class action in California federal court claiming it violated the Telephone Consumer Protection Act.

The defendant’s terms of service, which were hyperlinked in the sign-up box, contained a clause providing for arbitration of disputes with a class-action waiver.

Read the article.

A new post on Global Private Equity Watch discusses the continued need for vigilance in the wording of forum of selection provisions in agreements.

Author Glenn D. West takes a look at a recent Delaware ruling on an anti-suit injunction attempting to prevent a suit being prosecuted in Texas.

The court granted the injunction against the Texas suit because the fraud claims would require construction and interpretation of the agreement.

Read the article.

Flexera has posted a complimentary on-demand webinar discussing the role of in-house and external counsel in managing open source software in the business environment.

“Having some best practice guidelines that more clearly define your role and help you guide companies through license compliance and risk management only reinforces and bolsters one of your most important responsibilities as a legal advisor,” the company says in its invitation to view the event.

Speakers are Amy Chun, partner in Knobbe Martens, and Marty Mellican, vice president and associate general counsel of Flexera.

Some of the topics covered include:

• Key data points that emphasize there’s a lack of understanding regarding the amount of OSS companies are using
• The range of OSS risk and what that means to you
• Actionable steps and tips for managing OSS risk including available tools, how to flag issues, implement policy, and update agreements

Watch the webinar.

A U.S. appeals court ruled Thursday that judges on a patent review panel were unconstitutionally appointed, casting a cloud over some of its work, according to a Bloomberg report.

The court ordered a new hearing before different judges at the U.S. Patent and Trademark Office’s review board in a dispute over a surgical device. The court suggested other pending patent challenges may suffer the same fate, report Bloomberg’s Susan Decker and Greg Stohr.

“The Court of Appeals for the Federal Circuit said that, under a 2011 law that created the reviews before the panel, called the Patent Trial and Appeal Board, judges had so much authority they should have been appointed by the president and confirmed by the Senate.”

Read the Bloomberg article.

The law firm of Thompson & Knight LLP advised Oilfield Water Logistics, LLC (OWL) in connection with the sale of its midstream water infrastructure and services business to InstarAGF Asset Management Inc. and its Canadian and international co-investors.

The Thompson & Knight team representing and advising OWL was led by Jesse E. Betts and J. Holt Foster, III, with assistance from Partners Debra J. Villarreal, William M. Katz, Jr., Anthony J. Campiti, Shad E. Sumrow, Todd D. Keator, Jason Patrick Loden, Elizabeth A. Schartz, Gregg C. Davis, Kurt Summers, and James C. Morriss III; and Associates Courtney J. Roane, James Bedotto, John B. Phair, Timothy J. Johnston, Jana Benson Wight, Aaron C. Powell, Craig Carpenter, Lindsay Kirton, and Leslie Reynolds.

A recent case decided in the Court of Federal Claims serves as a stark reminder that any time a contract with the Federal government is amended or modified, the parties must pay particular attention to any release language contained in the amendment, or they run the risk of releasing potential claims that are unrelated to the modification, according to the Murtha Cullina Family Business Perspectives blog.

Mark J. Tarallo discusses the case of Meridian Engineering Co. v. US, a dispute a contested release and waiver of payments for the work at issue.

“Any release document (including releases with parties other than the government) should be narrowly drawn and clearly articulate those claims that are being released,” Tarallo advises

Read the article.

Two recent court of appeals cases address the enforceability of liquidated damages clauses, writes John McFarland in the Graves, Dougherty, Hearon & Moody Oil and Gas Lawyer Blog.

“A liquidated damages clause is a provision in a contract specifying a dollar amount (‘liquidated damages’) to be paid by a party if the party breaches the contract. Such clauses are common in all types of contracts, particularly in the oil and gas industry,” McFarland explains.

In his post, he discusses some recent cases that address the issue.

Read the article.

While often thought of as not controversial and relatively non-substantive, boilerplate provisions play an integral role in clarifying the relationship between the contracting parties. Neglecting those provisions can lead to unintended legal consequences, warns Thompson Coburn LLP.

Authors Brent Trame and Taylor Melching discuss examples of common boilerplate provisions that warrant closer review: Assignment, governing law and jurisdiction/venue, and the entire agreement clause.

Read the article.

The U.S. District Court for the District of the Virgin Islands recently compelled arbitration after concluding that a personal guaranty incorporated an arbitration agreement from an underlying contract and rejecting various arguments to the contrary, reports Carlton Fields’ Reinsurance Focus.

The case involved a leasing agreement that contained an arbitration provision, but the personal guaranty did not. The personal guaranty did, however, provide that the “performance of any and all financial obligations of the Lessee to the Lessor … subject to the terms and conditions contained in the … Leasing Agreement.”

The court found that the plain language of the personal guaranty incorporated the arbitration provision from the leasing agreement.

Read the article.

Litigation is a cost of business, but many savvy in-house counsel effectively manage that cost by including pre-dispute jury waivers in counterparty contracts, points out Bloomberg Law.

Jury waivers memorialize an agreement between contracting parties that fact-finding in disputes arising between them will be decided by judges, and not by juries, according to authors David L. Goldberg and Sean M. Akchin of Katten.

They discuss their five suggestions, under the headings Be Careful What You Wish For, Be Conspicuous, Be Specific, Don’t Be Greedy, and Don’t Be Tardy.

Read the article.

To avoid surprises and unanticipated liability on construction projects, the parties should modify contracts consistent with Texas law—or at least be aware of the limitations that are in place due to certain Texas statutes, according to a post on the Porter Hedges Texas Construction Law blog.

Author Amy Wolfshohl discusses the top five  modifications to consider on private commercial construction projects.

Those topics include retainage, indemnity, AI coverage, Texas law, and lien releases.

Read the article.

Letitia James
Image by Thomas Good

Roughly 40 state attorneys general plan to take part in a New York-led antitrust investigation of Facebook, reflecting a broadening belief among the country’s top Democrats and Republicans that the tech giant may be undermining its social-networking rivals, reports The Washington Post.

New York Attorney General Letitia James first announced a wide-ranging probe with seven other states and the District of Columbia to explore whether, in James’s words at the time, Facebook has “endangered consumer data, reduced the quality of consumers’ choices, or increased the price of advertising,” writes the Post‘s Tony Romm.

Sources told the newspaper that New York continues to solicit support from other states, meaning the number could grow before it is formally announced.

Read the Post article.

Regina Campbell offers an overview of the three types of contracts and agreements that companies should consider using.

Writing on Lawyers. com, Campbell, of The Campbell Law Group, discusses employee agreements, advising that companies should use an at-will agreement that clearly states that a new hire’s employment can be terminated at any time for any reason.

She also discusses vendor agreements and independent contractor agreements.

Read the article.

Even if an errors and omissions policy contains a breach of contract exclusion, coverage may be available in a breach claim, depending on the circumstances and applicable law, writes Charles P. Edwards for Barnes & Thornburg.

Writing in the firm’s Policyholder Protection blog, Edwards discusses a recent court ruling involving coverage for a breach of contract claim brought against a corporate policyholder by one of its customers.

The article also covers two other similar cases.

Read the article.

A distribution agreement is a legally binding contract between a seller of goods and a distributor that outlines the details involved in the sale and transfer of goods, explains Regina Campbell of The Campbell Law Group.

“By having a distribution agreement, businesses save time and money by avoiding misunderstandings that affects the profitability of each party and preventing future litigation over disputes,” she writes in a post on Lawyers.com.

In the post, she discusses the mistakes, which involve not using a distribution agreement, attempting to distribute too much, too fast, failing to specify whether the agreement is exclusive, lack of termination clauses, and lack of renewal language.

Read the article.

The former general counsel of Mithril Capital Management, Crystal McKellar, has staged a multi-pronged campaign to disparage the company, according to a new legal petition filed in Texas, where Mithril has its headquarters.

McKellar was the company’s only general counsel, reports TechCrunch.

Fox Business reports that the lawsuit claims: “After leaving the business, she immediately ‘began a concerted whisper campaign to undermine Mithril, in which she would make false, anonymous complaints to Mithril’s limited partners.'”

McKellar is a Harvard-trained lawyer and former child TV star. Mithril is owned by Peter Thiel, the Silicon Valley billionaire who toppled Gawker Media.

Read the TechCrunch article.

A Los Angeles jury returned a complete defense verdict for Hyundai Motor America and Hyundai Motor Company on Sept. 26, following a three-week trial presided over by Judge John A. Torribio.

The action was in the Norwalk Courthouse of the California Superior Court for the County of Los Angeles. Plaintiff Jorge Romo brought suit against the Hyundai defendants in January 2015, claiming that the subject 2003 Hyundai Tiburon was defectively designed and seeking an award of $40 million in economic and non-economic damages.

According to a release from Hyundai’s defense law firm: The action arose out of a motor vehicle accident that occurred in 2013, around midnight in South Gate, California. Defendant Alfred Schaer was driving his 2003 Hyundai Tiburon with another individual in the front passenger seat and plaintiff in the right rear seat. Schaer lost control of the vehicle causing it to leave the roadway, travel off the right side of the road, impact a curb and a chain-link fence, and finally collide with a steel shipping container at over 20 miles per hour. During the accident sequence, the shipping container deformed the passenger side of the Hyundai Tiburon and fractured the windshield, passenger side windows, and backlite. When the vehicle came to rest, plaintiff discovered that he had suffered a traumatic amputation of his right upper arm, according to the release.

Plaintiff filed suit against the Hyundai defendants, alleging that the Hyundai Tiburon was defectively designed because tempered safety glass — rather than laminated glass — was used in the side windows. Plaintiff also asserted a claim against Schaer for negligently operating the vehicle. At trial, plaintiff sought $40 million in economic and non-economic damages.

Plaintiff offered the testimony of numerous retained experts, including an automotive engineering and glazing expert, Stephen Batzer, Ph.D., P.E., biomechanics expert, Peter Francis, Ph.D., and accident reconstruction expert, Joseph Yates. These experts offered opinions in support of plaintiff’s theory that, if the Tiburon had been equipped with laminated glass instead of tempered safety glass in the side windows, the passenger-side, rear quarter window would have remained in place and prevented plaintiff’s injuries. Plaintiff’s automotive and mechanical engineering expert, Donald Phillips, P.E., presented a series of different litigation tests purportedly demonstrating that the properties of laminated glass were such that the use of laminated glass would have prevented plaintiff’s injuries during the accident.

In response, the Hyundai defendants offered the testimony of biomechanics and glazing expert Michael Carhart, Ph.D., as well as accident reconstruction expert Jeffrey Croteau. Carhart explained that the use of tempered safety glass is a safe and appropriate design choice for automotive side windows that complied with all applicable federal and industry standards, and accordingly that the Hyundai Tiburon was not defective or unreasonably dangerous. Moreover, Croteau prepared an extensive accident reconstruction based on 3D laser scanning and modelling and Carhart prepared a surrogate study and other 3D modeling establishing that the rear quarter glass window fractured when the vehicle impacted the edge of the 40-foot, multi-ton steel shipping container, and that the use of laminated glass in the quarter window would not have prevented plaintiff’s injuries. The Hyundai defendants also presented a complex sled crash test using an exemplar Hyundai Tiburon with laminated glass installed in the rear quarter window. This crash testing, which matched the relevant interactions in the underlying crash sequence, demonstrated that the use of laminated glass would not have prevented plaintiff’s injury, according to the release.

After deliberating over the course of three days, the jury found in favor of the Hyundai defendants on both the Strict Product Liability Consumer Expectation Test and Strict Product Liability Risk-Benefit Test. As to the claim for negligent operation of the vehicle, the jury returned a verdict against Schaer and awarded plaintiff a total of $17,270,000 in economic and non-economic damages.

Plaintiff presented the following experts at trial: automotive engineering and glazing expert Stephen Batzer, Ph.D.; automotive and mechanical engineering expert Donald Phillips, P.E.; biomechanics expert Peter Francis, Ph.D.; accident reconstruction expert Joseph Yates; economist expert Catherine M. Graves, MBA, CFA; orthopedic surgery expert Frederic Nicola, M.D.; psychology expert, Anthony Reading, Ph.D.; prosthetic expert Richard Riley, B.S.Ed., C.P., FAAOP; and psychical medical and rehabilitation expert, Khyber Zaffarkhan, D.O., FAAPMR. The Hyundai Defendants presented accident reconstruction expert, Jeffrey Croteau, and biomechanics and glazing expert, Michael Carhart, Ph.D.

Plaintiff was represented by Daniel Sheldon of Scolinos, Sheldon & Nevell, and Patrick Ardis and Kip Whittemore of Wolff Ardis, P.C., based in Memphis, Tennessee.

The Hyundai defendants were represented by Gary Wolensky, Paul Alarcon, and Taylor Brown of Buchalter, as well as Hyundai Motor America’s in-house counsel, Jamison Power.

Defendant Alfred Schaer was represented by David Gomes of Gomes Hirshik & Hummel.

A post on the website of Bryan Cave Leighton Paisner discusses a key component of contract obligation management – increasing obligation tracking and traceability.

“Conducting that evaluation of your existing contracts will allow you to identify risks and opportunities for negotiation of new contracts and allow you to better marry any potential technical obligation management tools to your contract environment, potentially turning in-house teams from SG&A on the income statement into their own profit center,” according to the post.

The article discusses reporting and recordkeeping, along with information, auditing, in detail.

Read the article.