Unlike most contractual disputes, it is not just merely the language used but also the circumstances in which the parties were contracting that will be determinative of whether direct claims are covered by the indemnity (and thus whether there will be reimbursement of legal fees), write Richard Levine, Peter Feist and Jessica Djilani in Weil, Gotshal & Manges LLP’s Global Equity Watch.

The authors write that “even a winning litigant in the U.S. typically cannot recover its attorneys’ fees and expenses – a principle known as the ‘American Rule.’ Indemnification provisions typically reverse the American Rule by providing that the indemnified party can recover its attorneys’ fees and expenses from the indemnitor.  Thus, whether an indemnification provision applies to claims between the contracting parties – say for breach of a representation or warranty – is often heavily litigated.”

This article is the first in a series on the subject.

Read the article.

On June 17 the Austin Court of Appeals unanimously ruled in favor of Beck Redden‘s clients Statoil ASA and Fargo Acquisition, Inc., vacating a class certification order, the law firm reported.

The case, Brigham Exploration Co. et al. v. Boytim et al., involves Statoil’s 2011 acquisition of Brigham Exploration Company, the firm said in a release. Immediately following the announcement of the acquisition, a group of Brigham shareholders filed a purported class action, alleging claims for breach of fiduciary duty against Brigham’s board of directors and aiding and abetting that breach against Statoil, Fargo, and Brigham.

Beck Redden represents Statoil and Fargo in the litigation, led by partner Fields Alexander and associate Chris Cowan, and handled the second appeal of the class certification order. Appellate briefs were filed by appellate partner Russell Post with the assistance of Cowan and associate Parth Gejji.

After hearing oral argument by Post and lawyers for the Brigham defendants, the appellate court vacated the class certification on the ground that the class was not sufficiently defined because it included numerous shareholders who lacked standing, according to the release.

The case has been remanded for further proceedings in the trial court.

Image by Ron Mader | Planeta

At the Big Law Business Summit last week, New York State Attorney General Eric Schneiderman ripped into Exxon Mobil for its stance on climate change, reports Bloomberg.

The report says Schneiderman accused Exxon of glossing over the risks that climate change poses to its core businesses in its public securities statements, and then couching its disclosure as first amendment protected.

“The first amendment doesn’t protect fraud – it doesn’t protect fraudulent speech,” he said.

Seventeen state attorneys general are investigating whether fossil fuel companies mislead investors in public disclosures about the risks associated with climate change.

Read the article.

In a new Bloomberg article, Stephen Poor, chair emeritus of Seyfarth Shaw, offers some perspective on what lies ahead for law firms in light of the recent escalation of pay for associates. He concludes that firms “still using a more traditional structure will experience this compensation increase as the first domino in a cascade throughout all fee earners, putting immense pressure on future performance and the health and stability of the firm.”

Traditionally, he writes, firms passed the burden of salary hikes to their clients via higher rates, reducing expenses elsewhere in the organization, raising (often silently) expectations on associates or being quicker to cut expenses (and people) in the face of declining demand.

“This time is different,” he writes. “Not because Big Law has moved into some form of corporate socialism, but because circumstances have changed. As power has shifted to buyers of legal services and the options for legal service delivery have expanded, the idea that firms will be able to shift some or all of the cost of associate compensation to rate increases seems almost inconceivable. Over a period of years? Perhaps. From the start? Not likely.”

Read the article.

FedEx Ground Package System Inc. has agreed to pay drivers in 20 states $240 million to settle lawsuits claiming the second-largest U.S. parcel delivery company misclassified them as independent contractors, it said on Thursday, according to a Reuters report.

Reporter Daniel Wiessner said Beth Ross, lead lawyer for the plaintiffs, said in an email that the settlement, if approved, would be divided among 12,000 drivers, some of whom would receive tens of thousands of dollars.

FedEx previously contracted directly with independent operators in an effort to save on taxes, fringe benefits, health care costs, pensions and other workers’ costs.

“The deal, subject to approval by a federal judge in Indiana where the cases were consolidated, would end nationwide litigation claiming that because drivers were required to use company-branded trucks, uniforms and scanners, FedEx was their employer under federal and state laws,” Reuters reports.

Read the article.

The National Labor Relations Board (NLRB) has continued its assault on businesses and their ability to legitimately protect their computer systems and information against unauthorized non-business use by employees, writes Shawn E. Tuma, in Cybersecurity Business Law.

Tuma is a cybersecurity and data protection partner at Scheef & Stone, LLP.

“On May 3, 2016, an NLRB Administrative Law Judge struck down as overbroad a Computer Use Policy in Ceasars Entertainment Corporation d/b/a Rio All-Suites Hotel and Casino (NLRB Docket Sheet). The policy, titled Use of Company Systems, Equipment, and Resources, was part of the company handbook and stated that computer resources may not be used to do several things that were listed out and is standard in many similar policies,” he writes in his article.

Read the article.

An article written by Raymond Patella and Michael Viscount of Fox Rothschild LLP outlines a handful of popular credit enhancements oil and gas companies may use to minimize their risk or exposure to a counterparty that they believe may be having financial difficulties.

“There are many different types of credit enhancements depending on the parties’ leverages, cash flow, size and risk. All of these factors should be considered to arrive at an enhancement best tailored to address the concerns of specific circumstances,” they explain.

The cover such topics as tighter payment terms, consignment, security interest, security deposit, credit insurance, guaranties, and setoff.

Read the article.

Recognizing that the incentive for long-term investment is broken, leading institutional investors are developing a new paradigm for corporate governance that prioritizes sustainable value over short-termism, integrates long-term corporate strategy with substantive corporate governance and requires transparency as to director involvement, according to an article by Martin Lipton of Wachtell, Lipton, Rosen & Katz.

The article is posted on the Harvard Law School Forum on Corporate Governance and Financial Regulation.

He wrote that he believes the new paradigm can reduce or even eliminate the outsourcing of corporate governance and portfolio oversight to ISS and activist hedge funds.

Among the topics he covers in the article are: Make the case for long-term investments, reinvesting in the business for growth and pursuing R&D and Innovation; Explain why the right mix of directors is in the boardroom; Articulate the link between compensation design and corporate strategy; Discuss how board practices and board culture support independent oversight.

Read the article.

Construction contracts are often such voluminous documents that it can be difficult for owners to recognize and adequately negotiate the key terms that play the largest role in how construction risk and costs are allocated, writes Mike Madigan in Kegler, Brown, Hill + Ritter‘s Ohio Construction Law blog.

In the article, he considers 10 questions owners should ask themselves before signing a contract with a contractor for a commercial project.

A few of those questions are: Is there a consequential damages waiver? Is there a liquidated damages provision? Is the contractor required to provide a performance and payment bond? What costs are recoverable by the contractor under a termination for convenience?and has the contract been coordinated with the requirements of the lending institution?

Read the article.

In today’s business environment, bank officers are heavily recruited by competitors, and these competitors offer opportunities for promotion and higher salaries and benefits, write Amber M. Rogers and Alan J. Marcuis for Hunton & Williams.

If a bank doesn’t have a contract with its officers, it must consider the legal ramifications of an officer departing to work for a competitor when an agreement is not in place.

“Having an employment agreement with an officer and other key employees is advisable, as it is the easiest way to protect the bank’s interest when an officer departs,” the authors explain. “With proper planning and preparation, any financial institution can proactively prevent the disruptive event and potential loss of business that can be caused by the announcement of an officer’s resignation.”

Read the article.

Irene A. Zoupaniotis has joined Farrell Fritz‘s Uniondale office as a labor & employment associate.

From February 2013 to August 2015, Zoupaniotis was a litigation associate at an insurance defense law firm in NYC. She also held the following positions: Judicial Fellow, The Honorable Leonard B. Austin, Appellate Division 2nd Department (September 2012 to February 2013); Intern, NYS Division of Human Rights, Office of Sexual Harassment Issues (Spring 2012); Intern, NYC Office of Labor Relations (Summer 2011); and Judicial Intern, The Honorable Nicholas G. Garaufis, U.S. District Court E.D.N.Y. (Summer 2010).

Zoupaniotis, an Astoria, NY resident, earned her Juris Doctorate, magna cum laude, from Hofstra University School of Law. She was an Articles Editor for the Hofstra Labor & Employment Law Journal. Irene received her Bachelor of Arts degree, magna cum laude, Phi Beta Kappa, from the William E. Macaulay Honors College at Queens College. She earned her Master of Laws (LL.M.) from Columbia Law School, where she was a Harlan Fiske Stone Scholar.

She is admitted to practice in New York, New Jersey and the Southern and Eastern Districts of New York.

Zoupaniotis is fluent in Greek.

Image by NY Photographic

Chief executives of the biggest U.S. corporations saw their pay rise in 2015 at the slowest rate in seven years, but it’s not because their boards were suddenly getting tough, according to a study by ISS Corporate Solutions and reported by Reuters.

Companies’ allocations for pensions fell substantially last year, a result of rising bond yields and anticipation of the U.S. Federal Reserve’s first interest-rate hike in nearly a decade.

“The smaller pension component – a theoretical amount, to be paid in the future – has eaten into the value of total compensation packages and muddied the closely scrutinized relationship between company performance and executive pay,” writes Sai Sachin R.

“At 0.1 percent, the median pay rise in 2015 for the CEOs of more than 300 of the S&P 500 companies was the smallest since the financial crisis and a sharp decline from the 12.9 percent hike of 2014, data from ICS shows.”

Read the report.

U.S. District Judge Gonzalo P. Curiel, whom Donald Trump has publicly denounced as a “hater,” will decide whether to release videos of the presumptive Republican presidential nominee’s testifying in a lawsuit against Trump University, reports NBC News.

The videos Trump’s lawyers want to keep out of the public record are from Trump’s deposition late last year and early this year in a class-action lawsuit accusing him of fraud. They said there’s “no legitimate reason” for the plaintiffs to submit the videos, arguing that the only motive to submit the videos is to create “prejudice” against Trump.

“This is precisely the type of ‘prejudice’ our adversarial system demands,” the ex-students’ lawyers said, adding that Trump “may think anything that does not go his way is unfair, but that is clearly not the legal definition of unfair prejudice,” according to the report by NBC’s Alex Johnson.

Read the article.

Gawker Media’s last-ditch effort to protect itself from a debilitating $140 million judgment using Chapter 11 may be a novel strategy to the media world but pharmaceutical and casino companies alike have recently used it with varying degrees of success, writes Maria Chutchian for Forbes.

A Florida jury recently awarded pro wrestler Hulk Hogan the damages in a privacy lawsuit stemming from Gawker’s publication of a Hogan sex tape in 2012, but Hogan is barred from executing the award against Gawker because of the company’s Chapter 11 protection from debtors.

“But Gawker founder Nick Denton, who is jointly liable for $115 million of that judgment plus another $10 million in punitive damages, doesn’t have the same protection. Gawker must convince a judge that the stay should be extended to cover Denton himself,” Chutchian writes.

Read the article.

Thomson Reuters Practice Point, a new tool that integrates the legal resources attorneys need to advise, negotiate and structure business dealings, is hosting a series of free 30-minute webinars providing an overview of current in-house legal trends.

June 15: Practice Point Exclusive Sneak Peek: Labor and Employment, 1:30 p.m. CT, featuring Kate Bally, Co-Director of Practical Law’s Labor and Employment service.

June 16: Practice Point Exclusive Sneak Peek: Capital Markets & Corporate Governance, 1:30 p.m. CT, featuring Chris Roehrig, Senior Legal Editor of Practical Law’s Capital Markets & Corporate Governance service.

June 22: Practice Point Exclusive Sneak Peek: Intellectual Property & Technology, 1:30 p.m. CT, featuring Rita Berardino, Senior Legal Editor of Practical Law’s Intellectual Property & Technology service.

June 23: Practice Point Exclusive Sneak Peek: Commercial Transactions, 1:30 p.m. CT, Featuring Laszlo Serester, Senior Legal Editor of Practical Law’s Commercial Transactions service.

Register for the webinars.

When negotiating and drafting a contract on behalf of a business, one of the most important considerations is whether it will create personal liability for the individual signing on behalf of the business, as illustrated by a recent decision from Florida’s Third District Court of Appeal, Frieri v. Capital Investment Services, Inc., writes Adam B. Edgecombe of Jimerson & Cobb, P.A.

“Frieri involved an investor who contributed $6 million to a business trust that he formed with the president of a small corporation, with each of them owning 50% of the trust,” Edgecombe explains. “In exchange for the investor’s contribution, the president of the corporation was to transfer 78% of the corporate stock to the trust. However, after the investor paid over his $6 million contribution, the president of the corporation never transferred the stock.”

The investor sued both the president of the corporation and the corporation, alleging that the defendants had breached the stock-purchase agreement. The trial court agreed, entering a final verdict in the amount of $7,369,222.00 against the corporation and the president individually. On appeal, the president and the corporation argued there was no basis for his personal liability.

“The Third District disagreed with the president’s position, finding that, when two businesses contract, the entirety of the document must be analyzed to determine whether the parties intend to bind the businesses alone or whether the obligation extends to the signing agents in their individual capacities,” Edgecombe writes.

Read the article.

Kirkland & Ellis LLP announced that it advised TSSP, a leading special situations investment platform of TPG, on its agreement with Hunt Oil Co., a privately held oil and gas exploration and production company, to develop certain of Hunt Oil’s assets in the Midland Basin in Texas.

The development area covers approximately 18,000 net acres across Martin, Glasscock, Midland and Upton counties. Under the agreement, TSSP has committed up to $400 million to fund the development which is expected to take approximately three years to deploy.  Additional terms were not disclosed.

The Kirkland team was led by corporate partners Anthony Speier and David Castro and associates Christopher Heasley, Nick Wenker, Ryan Martin and Lindsey Jaquillard; debt finance partners William Bos and Lucas Spivey; tax partner Chad McCormick and associate Joe Tobias; environmental transactions partner Paul Tanaka and associate Stefanie Gitler; restructuring partner Ryan Bennett; and litigation partner Anna Rotman.

Read more details.

Platinum Equity and Stone Canyon Industries, LLC announced it has signed a definitive agreement for Platinum Equity to sell BWAY Corp. to Stone Canyon Industries LLC for $2.4 billion.

BWAY is a North American manufacturer of rigid metal and plastic containers used to package industrial, bulk food and retail goods. The sale is subject to regulatory approval and customary closing conditions, and is expected to close in August 2016.

Latham & Watkins LLP represented Platinum Equity in the transaction with a corporate deal led by Washington, D.C. partner David Brown and associates Daniel Kecman, Mariclaire Petty and Alexander Sevald. Advice was also provided on tax matters by New York partner Lisa Watts and associate Matthew Dewitz; on intellectual property matters by Washington, D.C. counsel Kieran Dickinson and Los Angeles associate Aryeh Richmond; on employee benefits matters by Washington, D.C. partner David Della Rocca and associates Matthew Conway and Nikhil Kumar; on environmental matters by Washington, D.C. partner James Barrett; on real estate matters by Chicago partner David Shapiro and associate Patrick Maloney; on government contracts matters by Washington, D.C. counsel Kyle Jefcoat; on export controls and sanctions matters by Washington, D.C. partner William McGlone and on debt financing matters by Washington, D.C. partners Scott Forchheimer, Patrick Shannon and Shagufa Hossain.

Platinum Equity acquired BWAY in 2012. In January 2013 BWAY acquired Ropak, a complementary producer of rigid plastic containers.

“BWAY’s success is a testament to strong collaboration with Ken Roessler and his management team and the value of truly integrating M&A with operations at every level of the investment,” said Platinum Equity Partner Louis Samson.  “The company is well positioned for continued success going forward.”

Samson said that BWAY’s EBITDA grew approximately 45% from 2012 to 2016 thanks to a combination of operational improvements and growth through acquisition.

“We have had a great partnership with Platinum Equity and we are proud of everything our teams have accomplished together,” said BWAY CEO Ken Roessler. “Today we have a fundamentally sound business with great momentum, and we are poised for continued growth and long-term profitability as we transition to Stone Canyon’s ownership.”

“BWAY’s success is a testament to strong collaboration with Ken Roessler and his management team and the value of truly integrating M&A with operations at every level of the investment. The company is well positioned for continued success going forward,” said Platinum Equity Partner Louis Samson.

Jim Fordyce, co-CEO of Stone Canyon Industries, said his firm is excited about BWAY’s potential and looks forward to working with Roessler and the management team.

“BWAY is a world class company with a great leadership team, dedicated employees and a very bright future,” said Fordyce.  “We look forward to working with Ken to help BWAY continue delivering on its strategic and operational plan as the company takes the next step in its evolution.”

Goldman, Sachs & Co. is serving as financial advisor to Platinum Equity and Latham and Watkins is serving as Platinum Equity’s legal counsel. BMO Capital Markets is serving as financial advisor to Stone Canyon Industries and Gibson, Dunn & Crutcher is serving as its legal counsel.

Foley & Lardner LLP announced that Natalie Annis and Jamil Daoud have joined the firm’s Estates & Trusts Practice in the Tampa office.

The firm, in a release, said Annis represents professionals, executives, business owners, retired individuals and families in developing, implementing and managing sophisticated estate plans.

The release continues:

She works with financial advisors, accountants, insurance professionals and other advisors to assist clients in developing comprehensive strategies to achieve diverse wealth preservation and succession planning goals, including estate and gift tax planning and asset protection.

Daoud has experience creating asset protection structures using various domestic planning techniques. He has designed and implemented basic and complex trust plans and designed limited liability company operating agreements and corporate buy-sell agreements to accomplish a variety of investment, tax and business objectives. He also has experience with the negotiation and implementation of premarital agreements.

“Natalie and Jamil have immense experience across an array of complex estates and trusts issues. Their comprehensive knowledge will greatly benefit our growing client base,” said Daniel Hess, chair of Foley’s Estates & Trusts Practice.

In addition, both Annis and Daoud have experience advising clients on advanced planning and gifting strategies using irrevocable trusts, including dynasty trusts, grantor trusts, life insurance trusts, gifting trusts and trusts for minors.

“We are extremely pleased to welcome Natalie and Jamil. They are highly regarded attorneys and bring a great deal of experience to our office and their practice areas,” said Randy Wolfe, managing partner of Foley’s Tampa office.

About Foley & Lardner LLP
Foley & Lardner LLP is a corporate law firm that provides legal and related services for complex issues facing companies today. With approximately 900 attorneys in 20 offices, Foley combines international reach with a local focus across a full range of legal services in various industries, including technology, health care, sports and manufacturing. Foley has been recognized by clients and the legal industry for its strong commitment to client service excellence and innovation. Learn more at Foley.com.

Lauren Kilgore  of Shackelford, Bowen, McKinley & Norton, LLP has been named to the 2016 Best of the Bar list published by the Nashville Business Journal.

Kilgore is one of just five attorneys practicing media and entertainment law to be selected to the 1^4th annual listing of the leading attorneys in Nashville and Middle Tennessee. She also was nominated based on her work in litigation and dispute resolution.

“Having worked in the entertainment business before entering the law profession, Lauren offers a unique perspective on the industry that her clients have come to depend upon,” says firm managing partner John Shackelford. “This is a well-deserved honor.”

An associate at Shackelford, Bowen, McKinley & Norton, Kilgore focuses her practice on entertainment, intellectual property, and commercial and business litigation. She represents recording artists, publishing companies, Internet companies and record labels in both transactional and litigation matters.

Kilgore has served as a Board Member of the Young Lawyers’ Division of the Nashville Bar since 2013, and she was selected last year to the inaugural class of the Nashville Bar Foundation’s Leadership Forum Program for up-and-coming local lawyers. She also was selected to the 2015 listing of Tennessee Rising Stars, which recognizes the top young attorneys in the state.

A graduate of Vanderbilt University Law School, Kilgore served as Senior Technology Editor of the Journal of Entertainment and Technology Law and as the Moot Court Board’s Executive Justice for the National First Amendment Moot Court Competition. She earned her undergraduate degree, summa cum laude, from Birmingham-Southern College. She resides in Cherokee Park with her husband, Sgt. Matthew Dixon, a 19-year veteran of the Metro Police Department, and their two daughters, Josephine and Arabella.

To determine its Best of the Bar selections, the Nashville Business Journal accepted public nominations for a two-month period, with finalists selected by peer vote. The final list featured 79 attorneys in 17 separate practice categories. The honorees were recognized at a June 2 reception at the City Winery. The complete list of winners can be found on online at http://www.bizjournals.com/nashville.

Shackelford, Bowen, McKinley & Norton, LLP is an aviation, general business and entertainment law firm representing aircraft owners, operators and servicers, financial institutions, recording artists, real estate owners and developers, automobile dealerships, record labels, and other businesses in legal matters across the country.