Does Your Employee Agreement Address These Three Often-Overlooked IP Provisions?

One area of an employee agreement that can be over-looked, or perhaps misunderstood, is intellectual property, according to a post by John E. Munro on the website of Harness, Dickey & Pierce. Intellectual property, however, can be one of the most valuable assets of a company and should not be glossed over.

In the post, Munro discusses three provisions of an employee agreement that may be missing or could use a tune-up.

These are: the present invention assignment clause, the invention assignment carve-out, and a whistleblower provision.

Read the article.



Fifth Circuit Overturns Arbitration Order Where Employer Failed to Countersign Agreement

The 5th U.S. Circuit Court of Appeals has reversed a Texas federal court’s order compelling arbitration in a sexual harassment and discrimination case because one party failed to sign an agreement to arbitrate, reports Karl Bayer in the Disputing blog.

Writing for the blog, Beth Graham describes the case in which the plaintiff, Huckaba, signed an arbitration agreement that waived her right to sue Ref-Chem L.P. prior to beginning employment with the company.

“The agreement included a signature box for Ref-Chem and also required that the company reciprocate by giving up its right to sue Huckaba. After the woman signed the contract, however, Ref-Chem failed to have an officer of the company countersign the document.”

When Huckaba later filed a sexual harassment, discrimination, and retaliation lawsuit against Ref-Chem, the company responded by filing a motion to compel arbitration. The district court granted Ref-Chem’s motion.

The 5th Circuit concluded “there is not a valid agreement to arbitrate in this case,” reversed the district court’s order compelling the dispute to arbitration, and remanded the lawsuit back to the district court, Graham writes.

Read the article.




Webinar: Leveraging the Data in Your Contracts to Prove the Value of Legal

Concord will present a complimentary webinar titled “From Cost Center to Profit Center: Leveraging the Data in Your Contracts to Prove the Value of Legal.”

The event will be Thursday, July 26, 2018, at 10 a.m. Pacific time.

Legal’s new role as a strategic business function has forced legal teams to evolve, shifting from cost-center to profit-center, Concord says on its website. This shift has transformed the overall value legal provides—moving well beyond risk management and cost savings—increasing the pressure on legal teams to become a source of revenue for their organization.

The webinar will equip participants to:

  • Identify the crucial KPIs for Legal when it comes to spend
  • Uncover strategies to take your legal team from cost center to profit center
  • Discover how Leverage the data in your contracts to prove the value of Legal

The webinar is presented in partnership with General Counsel News.

Register for the webinar.




Sometimes You Get Away with Unwritten Contracts

ContractsOne area where the distinction between written versus unwritten agreements makes a difference is in the calculation of the statute of limitations, points out Christopher G. Hill in his Construction Law Musings blog.

Virginia’s 5- year statute of limitations for written contracts — compared to the 3-year statute unwritten contracts — came into play in  M&C Hauling & Constr. Inc. v. Wilbur Hale in the Fairfax, Virginia Circuit Court.

M&C provided hauling services to the defendant through a subcontract with Hauling Unlimited. No separate written contract between M&C and Hauling Unlimited or Hale existed. Hauling Unlimited filed a plea in bar to have the matter dismissed as being brought beyond the 3-year statute and argued that no signed or other written contract existed.

“The Court determined that Hauling Unlimited and Mr. Hale assented to M&C’s terms and did not insist on a signature to make their contract a written one,” writes Hill.

Read the article.



Has the Government ‘Waived’ Goodbye to Strict Compliance with Your Contract Specifications?

A recent Armed Services Board of Contract Appeals decision confirmed that waiver defenses can defeat government demands for strict compliance with contract requirements, reports Cohen Seglias Pallas Greenhall & Furman.

Authors Maria L. Panichelli and Alissandra D. Young explain that the Board found in Appeal of American West Construction, LLC that the U.S. Army Corps of Engineers had effectively waived the right to enforce a construction contract specification.

“This meant that the government could not recover from the contractor the difference in the price it paid for the original specification and the lower amount spent by the contractor to perform the deviation,” they write. “In a world where the government often has the right to strictly enforce contract requirements and hold contractors financially responsible for any deviation, this decision is a big win for construction contractors.”

Read the article.



Negotiating Commercial Contracts – Insurance Words of Wisdom

Risk signOne of the key insurance policy provisions that is often included in commercial contracts to transfer risk is the requirement that one contracting party make the other contracting party an additional insured on their insurance policy, according a website post for SandRun Risk.

The authors discuss the 2013 Insurance Services Office revisions to the standard additional insured endorsement form.

The three significant changes are:

  • Insurance provided to an additional insured will apply only to the extent permitted by law
  • If additional insured coverage is required in a contract or agreement, the additional insured will not be provided coverage that is any broader than required in that contract or agreement with the named insured
  • The limits available to an additional insured will be the lesser of the limits required by contract or available under the policy

Read the article.



How Important are Irreparable Injury Provisions in Non-Compete Agreements?

Employers who use non-compete agreements take note: Minnesota courts want to see more than just words in a contract before they will grant injunctive relief against a former employee, warns a post on the website of Dorsey & Whitney LLP.

The article discusses St. Jude Medical, Inc. v. Carter, which arose after Heath Carter left his employer to work for a competitor. The employer filed suit against Carter and the competitor, alleging violations of Carter’s non-compete agreement. The employer sought an order enforcing the terms of the non-compete agreement and prohibiting Carter from working for a competitor in his then-current position. Although the jury found that Carter had breached his non-compete agreement, the court refused to enter an injunction, finding that the employer failed to establish that it had been harmed.

The Minnesota Court noted that “[a] private agreement is just that: private,” and concluded that such contractual language does not, by itself, entitle an employer to an injunction after proving the breach of a non-compete.

Read the article.



Contracts: Are You Accepting an Offer or Not?

A lack of precision in responding to an offer can lead to confusion as to whether or not a contract has been formed, warns an article published by Burns & Levinson on

The article discusses  APB Realty, Inc. v. Geogia-Pacific LLC, a case involving a contract negotiation for the purchase of 88 rail cars. During the negotiation, Georgia-Pacific offered two options to APB, the buyer. After APB said it was leaning toward one of the options, Georgia-Pacific’s broker told APB that his client had accepted a higher offer.

APB sued for breach of contract.

The article says that “the First Circuit held that because APB might be able to prove that a contract between it and Georgia-Pacific was formed, it would be improper to throw out the lawsuit on a motion to dismiss. Thus, while APB is a long way from winning its suit, at least it is in the fight.”

Read the article.




Fixed-Price Contracts Are Simple – Or Are They?

A podcast posted by Pepper Hamilton discusses the definition of fixed-price contracts and cases in which the audit provision in the contract has been unsuccessfully used to assert claims for reimbursement and False Claims Act liability.

“Fixed-price contracts are well-known among contractors,” the firm says on its website. “These agreements seem simple — they do not allow the contract price to be modified after the award unless the parties expressly agree. But is it really that simple? In reality, there is very little case law guiding the practical approach to these types of contracts.”

In the podcast, Marion Hack, a partner in Pepper’s Construction Practice Group, discusses these types of contracts.

Listen to the podcast.




Contractual Considerations for Lawyers Using the Cloud

The cloudBecause law firms are such desirable targets for hackers, firms have had to find solutions for keeping the intruders at bay. They can use internal systems managed by employees of the firm, or they can go to a cloud-based solution, such as software-as-a-service (SaaS).

Writing for Above the Law, Scheef & Stone partner Tom Kulik points out that SaaS platforms can help offset the cost by offloading technical and security expertise to the SaaS provider. But the standard contract terms offered by these providers do not weigh in favor of the law firm.

In the article, Kulik discusses some points to consider when a firm is considering entering into a contract for SaaS.

Read the article.



Drafting the Arbitration Provision in Commercial Contracts: Back to Basic

More and more cases are being submitted to arbitration as a result of pre-dispute contractual clauses, point out John P. DiBlasi and Jacqueline I. Silvey in an article for National Arbitration and Mediation.

“In other words, at the time of entering into the contract, it is wise to make sure the contract contains a clause that provides for arbitration in the event of a future dispute,” they write. “These clauses are found in all types of agreements and in a myriad of contract forms involving construction, consumer financing, employment, insurance, rendering of professional services, sale of goods, and others.”

The article covers the basics of the arbitration clause and the administration of the process in a dispute.

Read the article.



3 Simple Steps to Creating a Contract Lifecycle Management Shortlist

Conga and Gartner are offering Gartner’s Fast-Track to Creating a Contract life Cycle Management Shortlist With These 3 Steps to help companies kick-start the contract lifecycle management evaluation process by identifying what exactly is important to the organization and which tools can support the abundant needs of all stakeholders.

“The business landscape has becoming increasingly fast-paced and competitive,” Conga says on its site. “Having visibility into contract status while collaborating with stakeholders throughout your entire enterprise is imperative for success. From creation all the way through negotiation and execution, gain insight into your business with the addition of a contract lifecycle management (CLM) solution.”

The CLM market has become increasingly crowded, so finding a solution that supports the volume needs of enterprise contracts can be challenging.

Download the guide.



Live Webinar: Using A.I. to Make Sure You’re Covered This Summer

LawGeexLawGeex will present a live webinar titled “How Contract Review Automation Helps Mitigate Risk to Your Organization,” on Wednesday, July 18, 2018, at 2 p.m. EDT.

The 60-minute event will cover how to:

  • Automate contract review
  • Enable company-wide compliance with corporate policy
  • Mitigate an organization’s contracting risk using AI
  • Free up a legal team’s time for more strategic work

Register for the webinar.



Eliminating the Surprise Factor from Construction Contracts: Tips for Owners and Developers

Construction design planningOn construction projects, owners and developers often are familiar with standard contract language and provisions, but the industry is continually evolving, according to a paper published by Zetlin & De Chiara LLP.

The paper discusses 10 key contract provisions and tips to help parties avoid pitfalls.

Those areas include scope of work, compliance with schedule, meeting the owner’s target for the budget, contingency, changes in the work, indemnification, insurance, dispute resolution, general conditions, and subcontract issues.

Read the article.



IP Indemnification in Contracts

A post on the Morgan Lewis Tech & Sourcing blog reviews issues related to the defense and indemnification aspects inn contracts impacting intellectual property ownership.

Authors Peter M. Watt-Morse and Michael R. Pfeuffer write that “an IP indemnity clause typically includes the obligation to defend against third party IP claims. However, the potential costs and risks associated with this obligation can be impacted by the language of the provision.”

“Like any indemnitee, the user will want indemnification for IP infringement to be as broad as possible, including any losses, costs, damages or expenses whatsoever sustained by virtue of the third-party claim,” the explain.

Read the article.



Progress Payments: What to Do When the Money Stops Trickling In

A post on the Faegre Baker Daniels website asks the question: What does a contractor do when the owner stops making progress payments?

The contractor has two options: it can either continue to perform the work or cease the work, neither of which is a perfect solution.

“The owner’s failure to pay progress payments that are ‘clearly due and owing’ generally entitles the contractor to stop work until the progress payment is made. While this rule seems clear, it is not that simple,” according to the post.

The contractor should look to its contract with the owner to find answers to two questions: Does the contract require the contractor to take a certain action? And, is payment”clearly due and owning?”

Read the article.



Contracts with Foreign Companies May Require a Rewrite

A recent California case may force companies doing business with foreign entities to reconsider—and maybe rewrite—their contracts, points out Sheppard, Mullin, Richter & Hampton in its Corporate & Securities Law Blog.

In Rockefeller Tech. Invs. (Asia) VII v. Changzhou Sinotype Tech. Co., No. B272170, the California Court of Appeal held that parties may not contract around the formal service requirements of the Convention on the Service Abroad of Judicial and Extrajudicial Documents, commonly referred to as the Hague Service Convention.

Authors Hwan Kim and Neil Popovic write that the decision could have profound implications for international business.

“The Rockefeller decision arguably makes it impossible to require foreign companies from some of the largest economies including China, Japan, Germany, U.K., India, Korea, Russia and Mexico, to show up in a California court based on notice provided by mail, courier (FedEx), or email even if the parties agreed to such forms of notice in their contract,” the authors warn. “This will have profound consequences for companies with global supply chains such as Apple and GM, for investment funds with foreign investors, for engineering and construction companies that procure materials and handle projects around the world, such as AECOM, and potentially for any company that imports or exports goods to or from the United States.”

Read the article.



Limits to Enforcement of Non-Compete Agreements

A recent decision from the Connecticut Superior Court illustrates the limits to enforcing non-compete agreements, writes Michael LaVelle for Pullman & Comley’s Working Together blog.

LaVelle explains the case’s background: “Typical of non-compete enforcement situations, the plaintiff company learned that an executive employee who had just resigned had been hired by a key competitor. The former employee had signed a ‘Confidential Information, Non-Compete and Inventions Assignment and Assumption Agreement’ at the start of her employment. The company sought to enforce the agreement by obtaining an injunction to prevent the former employee from working for the competitor.”

The court found that by preventing the individual from performing any work or services, whether as an employee, consultant or independent contractor, for any competitor, the agreement went beyond the limits of reasonableness.

Read the article.



‘Gross Up’ Provisions in Office Leases

Few concepts are as confusing as the “gross up” of operating expenses to those who do not regularly deal with office leases, writes William Hof in a white paper for Husch Blackwell.

“Most tenants understand that in addition to base rent, tenants often directly reimburse their landlords for a portion of the building’s operating expenses (e.g., real estate taxes, casualty insurance, maintenance, utilities, etc.),” explains Hof.

In the paper, he defines “gross up” and explains how it works, and he discusses variable vs. constant expenses and tenant protection.

Read the article.



An Arbitrator’s Power May Be Greater Than That of a Judge

Arbitration is a creature of contract, and an arbitrator’s powers are in effect defined by the parties’ arbitration agreement, points out a post on the Mintz, Levin, Cohn, Ferris, Glovsky and Popeo blog ADR: Advice From the Trenches.

“Paradoxically, although an arbitration agreement can be written (double-spaced) on one side of a cocktail napkin, in some cases it may grant greater authority to an arbitrator than a judge has,” writes Narges Kakalia.

In the post, she discusses Timegate Studios, Inc. v. Southpeak Interactive, LLC, in which the Fifth Circuit confirmed an arbitration award in which the arbitrator substantially reformed the parties’ commercial agreement by, among other things, awarding one a broad perpetual license to certain of the other’s intellectual property, despite the fact that the original agreement had granted only a more narrowly drawn ten-year license.

Read the article.