The Orlando Sentinel is reporting that the founder of Tea Party Nation has been disbarred for trying to swindle timeshare owners into thinking they canceled their timeshares.

Tennessee attorney Judson Wheeler Phillips, a senior partner with Nashville-based Castle Law Group and founding member of the conservative Tea Party group, was accused of taking off with the money he earned from the fraudulent transactions, the Tennessee Supreme Court has ruled.

Federal lawsuits were filed against Phillips by Westgate Resorts and Orange Lake Resorts, both based in Orlando, as well as Las Vegas-based Diamond Resorts and Fort Lauderdale-based Berkley Resorts. More than 90 consumer fraud complaints also were filed.

Read the Orlando Sentinel article.

 

 

A post on the website of Meislik & Meislik discusses the differences between two contract provisions that sometimes are confused: forum selection and choice of law.

Ira Meislik explains:

What’s a forum selection provision? That’s the one your agreement says where you can file suit to enforce your agreement. What is often confused with a forum selection provision? That would be a choice of law provision. That’s where the parties agree as to which state’s law will apply to their agreement. Once you are properly in any state’s courts, those courts can apply whatever law you’ve agreed should be used.

His article describes how the two provisions work in various states and then concludes with six points to keep in mind during the drafting process.

Read the article.

 

 

The Washington Post reports on a meeting of the country’s top federal and state law enforcement officials on Tuesday that could presage sweeping new investigations of Amazon, Facebook, Google and their tech industry peers.

Participants voiced lingering frustrations that these companies are too big, fail to safeguard users’ private data and don’t cooperate with legal demands.

“Attorney General Jeff Sessions opened the meeting by raising questions of possible ideological bias among the tech companies and sought to bring the conversation back to that topic at least twice more, according to D.C. Attorney General Karl A. Racine,” according to reporters Brian Fung and Tony Romm.

But other participants steered the conversation toward the privacy practices of Silicon Valley.

Read the Washington Post article.

 

 

OneSpan has published a white paper titled “User Authentication for E-Signature Transactions” and made it available for downloading at no charge. (See the download form below.)

The white paper provides guidance on how to select and implement user authentication techniques. It answers questions like:

• How do I select the right authentication for my requirements?
• How do I implement strong authentication, without making the process difficult for the customer?
• Can I leverage existing user authentication credentials?
• Can I adjust my user authentication criteria for different transactions and processes?

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Franchisors need to review their franchise agreements and take immediate action in response to the recent onslaught of legal action over “naked no-poaching” provisions in franchise agreements, according to a post in Franchise Law Update on the website of Fox Rothschild.

“In a typical franchise agreement, a franchisor will prohibit a franchisee from poaching its or its other franchisees’ employees during the term of the franchise agreement and for a period of time after the franchise agreement ends,” the authors explain.

In April 2018, the U.S. Department of Justice initiated a criminal complaint against a number of companies respecting naked no-poaching agreements. While the case settled with only civil penalties imposed, the DOJ expressly stated that it was reserving the criminal question and planned to “zealously enforce” the law.

Read the article.

 

 

Nearly every form of service agreement contains a provision restricting the ability of one or both parties to subcontract their obligations, points out a post in the Tech & Sourcing blog at Morgan Lewis.

But authors Doneld G. Shelkey and Valerie A. Gross offer a caution: “These limitations are often included as a standard part of the legal boilerplate without much thought, but can present significant problems, especially given the broad use and incorporation of third-party technologies and services.”

In their post, they discuss use of a subcontracting principle called a “material subcontractor” provision.

Read the article.

 

 

Minimum volume commitment contracts (MVCs), often referred to as throughput agreements, are agreements under which a shipper or producer—a counterparty—undertakes to transport an agreed minimum volume of a commodity such as natural gas, NGL or crude oil through a third-party operator’s assets, such as pipelines or processing plants, over a specified period, explains a post on the website of Opportune.

“In the midstream industry, these contracts are typically utilized to enable the operator to recoup the costs of constructing infrastructure, such as a processing plant or pipeline lateral, for the benefit of the counterparty. Under these agreements a counterparty pays a shortfall or deficiency fee if the MVC is not met for a specified period—monthly, quarterly or annually,” the authors write.

Read the article.

 

 

It’s an unfortunate fact that many construction projects end in disputes, driving the parties into some form of dispute resolution, writes Jason T. Strickland, a litigator with Ward and Smith.

Many of these construction disputes are resolved through arbitration, he writes in a web post.

His article explains how arbitration is different, the major differences between arbitration and lawsuits, court involvement in the arbitration process, avoiding unfavorable local law, and third-party administration of arbitration.

Read the article.

 

 

 

Can an unsigned contract still be a contract? The answer is yes, for statute of limitations purposes, says the 7th Circuit Court of Appeals, according to Stephen M. Proctor in a post for Masuda, Funai, Eifert & Mitchell.

On this basis, he writes, it permitted a Chicago law firm to pursue a claim of unpaid fees against a foreign company and its U.S. subsidiary.

The court’s ruling quoted prior cases: “A contract is deemed written for these purposes ‘if parties are identified and all the essential terms are in writing and ascertainable from the instrument itself.’”

Read the article.

 

 

Brynly Llyr, general counsel of Ripple, one of the world’s leading cryptocurrency companies, has left the payment and remittance network, reports Quartz’s Private Key newsletter.

Quartz reporter Matthew De Silva explains: “Ripple is gearing up for a class-action battle about whether its XRP cryptocurrency is a security or not, and has bolstered its legal team by retaining heavyweights like former US Securities and Exchange Commission chair Mary Jo White and the regulator’s former director of enforcement, Andrew Ceresney. Although Llyr is an experienced attorney with impressive credentials, she doesn’t have the same sway as some of these other legal advisors. Still, the turnover on Ripple’s in-house legal team comes at an awkward time, given the impending case.”

Read the Quartz article.

 

 

Utility-scale battery energy storage system transactions present unique legal issues and require special analysis of traditional contract provisions, according to Solar Industry.

Rodrigo Figueroa lists and then discusses the top five legal issues to consider when contracting for utility-scale energy storage.

Those issues include:

1. Uptime Guarantee
2. Intellectual Property
3. Security for Payment and Performance
4. Force Majeure and Changes in Law
5. Indemnity and Insurance

Read the article.

 

 

 

In many contracts, reference is made to one or the other party to the agreement undertaking its “best efforts,” “reasonable efforts” or commercially reasonable efforts.” Often, much time and attention is devoted to negotiating which of these standards will apply, points out Mayer Brown.

But these standards are inconsistently interpreted by courts and are often subjectively applied, the authors of the article explain. Practitioners generally understand that “best efforts” is considered the highest of these standards requiring a party to undertake every action, short of bankruptcy, to accomplish the stated objective. On the other hand, “reasonable efforts” is perceived to be a less stringent standard, allowing a party to use its discretion “within its good faith business judgment” to fulfill a particular contractual obligation.

“Commercially reasonable efforts” is generally interpreted as requiring a party to undertake some conscious effort to accomplish the agreed-upon goal; however, the standard is understood to limit the amount of effort a party is required to expend.

Read the article.

 

 

“Choice of law” clauses in contracts are often overlooked in their potential importance, as the parties and counsel concentrate on the more immediate matter of the explicit commercial terms, write Val H. Stieglitz and R. Bruce Wallace for Nexsen Pruet.

“When the deal goes sour, however, and it comes time for the parties to assert and enforce their contractual rights, the spotlight often turns to the ‘choice of law’ provision – which perhaps no one had paid much attention to previously,” the authors explain.

Their article examines a recent case experience highlighted how “choice of law” distinctions can become significant once matters enter litigation.

Read the article.

 

 

A D.C. district court ruled that an eBay user did not assent to a later-added arbitration clause to the user agreement by virtue of a provision that stated eBay could amend the agreement at any time, as the user may not have received sufficient notice of the amendment, according to the Proskauer Rose New Media and Technology Law Blog.

“Notably, the court declined to find adequate notice sufficient to demonstrate an agreement to arbitrate merely based on the fact that the amended user agreements were posted on eBay’s website (at least under Utah, Louisiana or Texas law). This case is interesting as many websites and services have added mandatory arbitration clauses to their terms in recent years, yet may have a stable of legacy users that agreed to a prior set of terms that did not contain such a provision,” writes Jeffrey Neuburger.

Read the article.

 

 

A federal judge in the U.S. District Court for the Southern District of Texas has appointed Warren Burns of Dallas-based Burns Charest LLP as sole interim lead class counsel in a nationwide antitrust class action. The litigation alleges a conspiracy by online retailers, including Houston-based Zaapaaz, to fix prices for customized silicone wristbands and lanyards.

In 2017 the defendants in the class action pleaded guilty to a range of federal charges of price-fixing in violation of Section 1 of The Sherman Act.

In appointing Burns as sole interim lead counsel, the court explained:

This appointment is warranted for several reasons. First, at oral argument, Mr. Burns was the only counsel who offered the Court substantive, detailed explanations on how he structures and runs his large case litigation teams.

Of particular note were Mr. Burns’ explanations of his and his firms’ billing practices in prior class action litigation, and his representations that he will use those practices, such as not permitting billing for file and correspondence review, and other mechanisms to ensure efficient prosecution of this case.

Second, the balance of the Rule 23(g) factors support appointment of Mr. Burns and Burns Charest as sole interim lead counsel. Burns Charest has made extensive efforts in these matters to date, Mr. Burns and his firm have significant experience in antirust class actions, and he and his firm have knowledge of the applicable law.

The court concluded that “Burns Charest is uniquely positioned to prosecute this case in the most cost effective and efficient manner possible.”

The case is Kjessler v. Zaappaaz, Inc. et al., Case No. 4:17-cv-3064 (S.D. Tex).

 

 

A federal judge on Thursday refused to overturn the fraud and conspiracy convictions of four former executives for the only financial institution to be criminally charged in connection with the federal bank bailout program, the Associated Press reports.

Judge Richard Andrews refused to enter judgments of acquittal or set new trials for the former Wilmington Trust executives.

“Former bank president Robert Harra Jr., former chief credit officer William North, former chief financial officer David Gibson and former controller Kevyn Rakowski were convicted in May on charges of fraud, conspiracy and making false statements to federal regulators,” writes reporter Randall Chase

Read the AP article.

 

 

 

Outside companies that provide services to Microsoft Corp. will be required to provide their employees 12 weeks of paid family leave, announced the company’s new general counsel, Dev Stahlkopf.

The Washington Post reports that, under the requirement, mothers and fathers who perform work for Microsoft — biological and adoptive — must receive 12 weeks of leave at two-thirds of their wages or up to $1,000 weekly. The new rule applies to outside contractors, such as those providing culinary, housekeeping and receptionist work.

“Microsoft now partners with more than 1,000 firms across the U.S. — half of which work outside Washington state,” writes reporter Danielle Paquette.

Read the Washington Post article.

 

 

Morgan Lewis discusses a frequent point of contention between parties negotiating the allocation of risk related to intellectual property rights in connection with the acquisition of intellectual property: the interplay between the warranty and indemnification sections.

In the post, authors Emily R. Lowe and Susan Milyavsky break down what to look for in these sections and how minor changes in the language can significantly change the rights a party is granting or receiving.

The post is part of the firm’s Contract Corner series in the Tech & Sourcing blog.

Read the article.

 

 

 

A recent decision from the Virginia Supreme Court further weakens the enforceability of teaming agreements, which may mean trouble for prospective subcontractors, according to an alert from Baker & Hostetler.

The post explains:

“In light of CGI Federal, contractors should assess whether they can reasonably rely on the terms and conditions of their teaming agreements to provide meaningful assurances regarding the negotiation of a prospective subcontract without binding themselves to more definite terms prior to any prime award, at least under Virginia law. Accordingly, unless contractors wish to consider the law of other forums when negotiating their teaming agreements, they must pay close attention to the specific terms and conditions of their contracts when evaluating what is and is not enforceable and govern their pre-award conduct accordingly.”

Read the article.

 

 

There is a circuit split on the weight courts should give contractual provisions allowing the appointment of a receiver in loan documents, points out William Easley in a post for Bryan Cave Leighton Paisner. While some courts treat the provision as granting a contractual right to a receiver, others treat it merely as a factor to be considered.

He writes that “many district courts recognize that allowing the appointment of a receiver upon a contractual provision is imperative to give the creditor the benefit of its bargain.”

“A creditor’s contractual right to appoint a receiver under the loan documents will differ drastically between the circuits. Potential creditors need to consider the likelihood of succeeding on a motion to appoint a receiver to determine whether these provisions should be included in their loan,” he adds.

Read the article.