eSignLive by Vasco will present a complimentary one-hour webinar providing practical evidentiary considerations of electronic records and signatures and guidance on how to reduce your risk.

The event will be Tuesday, Feb. 7, 2017, beginning at 2 p.m. Eastern time.

Organizations undergoing digital transformation often have legal questions related to moving paper-based business processes online without introducing new risks. Beyond the minimum requirements for electronic and digital signatures set forth in the laws, addressing the risk of fraud, repudiation and compliance is of utmost importance as well. In the event of a regulatory audit or legal dispute, avoiding fines and ensuring admissibility is dependent on a company’s ability to produce convincing, reliable evidence.

Presenters will be Pat Hatfield, Partner at Locke Lord LLP, and Andrea Masterton, Corporate Marketing Director at eSignLive.

Highlights will include:

• A brief overview of e-sign legislation
• Insights gained from relevant case law
• How e-signature laws overlay with existing commercial and industry regulations
• The challenges of defending electronic transactions
• A live demonstration of ‘best practice’ e-signature audit trails & process evidence

Register for the webinar.

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In 2016, two federal juries in Dallas delivered significant verdicts on behalf of the victims of serious medical complications caused by defective metal-on-metal hip implants made by Johnson & Johnson and its subsidiary DePuy Orthopaedics Inc., according to a post by the plaintiffs’ legal counsel, The Lanier Law Firm.

Although the court has reduced the amount of punitive damages awarded by the juries in each case, and those judgments are under appeal by The Lanier Law Firm, the two verdicts still total almost $700 million in actual and punitive damages assessed against Johnson & Johnson and DePuy.

In the post, the firm said these verdicts marked the second and third bellwether trials among thousands of similar lawsuits nationwide that have been consolidated in multidistrict litigation (MDL 3:11-md-0244) in the U.S. District Court for the Northern District of Texas. A bellwether trial is one that is typically representative of all the issues involved in the litigation of a mass tort case.

Read the article.

Moving business processes online without introducing new risks is not a simple task. The fraud, repudiation, admissibility and compliance risks are challenging enough to address when executing transactions on paper. If not done properly in the electronic world, these risks can be far greater. This paper discusses how a well-designed process, supported by new-generation electronic signature technology, can actually reduce risk and increase the enforceability of e-transactions compared to paper processes. (See the download form below.)

This paper explains how eSignLive addresses the top six risks of bringing processes online as identified by leading
e-commerce law firm, Locke Lord LLP, which has guided Fortune 500 companies in the design and implementation of
electronic signature processes:

1. User Authentication Risk: “This Isn’t My Signature”
2. Repudiation Risk: “That’s Not What I Signed”
3. Admissibility Risk: “Objection, Your Honor”
4. Compliance Risk: “I Never Saw That”
5. Adoption Risk: “Am I Done Yet?”
6. Relative Risk: “How Does It Compare to PAPER?”

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Apple sued Qualcomm, its longtime partner,  over what it said was $1 billion in withheld rebates on Qualcomm’s smartphone technology, according to The New York Times.

Apple said the money had been promised in conjunction with an agreement not to buy chips from other suppliers or to divulge ualcomm’s intellectual property licensing practices, writes reporter Quentin Hardy.

The suit follows the Federal Trade Commission’s accusation that Qualcomm used anticompetitive practices to guarantee its high royalty payments for advanced wireless technology.

“The commission cited Qualcomm’s deals with Taiwanese companies that manufacture Apple iPhones over semiconductors it sells for the iPhone,” writes Hardy.

Read the NYT article.

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Sometimes there’s a disconnect between “fairness” and the “justice” that is doled out by the legal system. One notable exception is the application by the courts of the concept of “the implied covenant of good faith and fair dealing,” writes David Allen of Jaburg Wilk.

Every contract consists of one or more express agreements, legally referred to as “covenants” between the parties, Allen explains. But inherent in every contract is also an unwritten “implied” additional covenant that is not expressly set forth; namely, the implied covenant of good faith and fair dealing.

In his article, he explains the obligations mandated by the implied covenant and how courts can be expected to enforce them.

Read the article.

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A majority of chief legal officers at U.S. companies expressed optimism that their business operations will be positively affected when Donald Trump becomes president, according to a survey by legal market research firm Acritas.

The survey found 72 percent of respondents believe their business operations will be impacted as a result of Trump’s election, Bloomberg Law reports. Fifty-six percent of respondents expected Trump to affect their business in a positive way while 44 percent had a negative outlook.

“Most of the positive responses related to a perception that Trump will cut back on the rules and regulations many companies believe hold them back unnecessarily, said Lizzy Duffy, vice president of Acritas US Inc.,” according to the report.

Read the Bloomberg article.

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Days before President-elect Donald Trump was to take the oath to uphold the Constitution, he followed through on a more painful obligation: coughing up $25 million to settle litigation over his defunct Trump University real estate seminar program, reports Politico.

Josh Gerstein reports that Trump University — now known as the Trump Entrepreneur Initiative — transferred the funds Tuesday night, according to two sources involved. The settlement provides enough money pay back about half of the funds paid by students for the seminars.

“Last March, Trump vowed not to settle the long-running litigation — two federal class-action fraud lawsuits and a parallel state court action brought by New York Attorney General Eric Schneiderman.” writes Gerstein. “The suits accused Trump U. of deceiving students by falsely claiming that Trump knew the instructors and that the school was an accredited university.”

Read the Politico article.

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Veteran trial lawyer Jay Old has joined the commercial litigation firm Hicks Thomas LLP, where he will represent construction, insurance, petrochemical and healthcare companies, effective Jan. 1, the firm announced in a news release.

Old’s addition will also include the opening of offices in Austin and Beaumont, further extending the geographic reach of the Houston-based firm, now in its 20th year.

Five other lawyers from his firm will joined Hicks Thomas, including labor and employment attorney Jim Henges.

Old frequently speaks at continuing education programs for lawyers. He is also a former president of the Texas Association of Defense Counsel and chaired the Construction Law Section of the State Bar of Texas.

Read more about the new hire.

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It turns out a law degree is just as helpful in launching a medical marijuana business as it is dealing with mortgages, according to a report in The Chicago Tribune.

Charlie Bachtell, CEO and co-founder of medical marijuana company Cresco Labs, was general counsel at Chicago-based mortgage company Guaranteed Rate before he moved into the legal cannabis business, reports Ally Marotti.

In a question-and-answer session, he discusses how he decided to switch fields, the stigma that can be attached to his new business, securing financing, and growing the business.

Read the Chicago Tribune article.

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The U.S. Supreme Court has agreed to decide whether companies can use employment contracts to prohibit workers from banding together to take legal action over workplace issues, reports The New York Times.

Adam Liptak writes that the court will consider three cases that follow a series of Supreme Court decisions endorsing similar provisions, generally in contracts with consumers. The question for the justices in the new cases is whether the same principles apply to employment contracts.

“In both settings, the challenged contracts typically require two things: that disputes be raised through the informal mechanism of arbitration rather than in court and that claims be brought one by one,” Liptak writes. “That makes it hard to pursue minor claims that affect many people, whether in class actions or in mass arbitrations.”

Read the NYT article.

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As with any energy project,utility-scale battery storage projects present land use, permitting and environmental and health and safety issues, and developers need to anticipate and address these issues to successfully meet project development timelines and goals, according to an article published by Farella Braun + Martell LLP.

“Development-related concerns for utility-scale BESS projects include site consistency with land use and zoning laws, worker safety, security and community safety measures, hazardous waste management and disposal, potential impacts on species and habitat, visual impacts, storm water management, and coordination with generation and transmission facilities,” write David J. Lazerwitz, Chris Locke and Brennan Quinn Bentley. “As with any new project-based technology, the myriad of issues relating to BESS projects are still evolving.”

Read the article.

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A new article in CoinDesk provides an overview of the ongoing issues with smart contract development, selecting just three that could remain barriers to mainstream use.

“With more than $17bn in assets stored in just the top 10 cryptocurrencies, there currently is a huge opportunity to give existing blockchain assets additional flexibility and utility by adding smart contract capabilities,” write CEO Arthur Breitman, and COO Kathleen Breitman of Tezos.

The three ways smart constract systems can earn our trust in 2017: Provide formal verification capabilities, ensure transparency so code can be inspected, and provide a clear governance mechanism.

Read the article.

Up to 90 percent of law firm work is done outside of the traditional billable hour model, according to the 2017 Report on the State of the Legal Market.

The ABA Journal reports on a study released by Georgetown Law’s Center for the Study of the Legal Profession and Thomson Reuters Legal Executive Institute.

“One of the most potentially significant, though rarely acknowledged, changes of the past decade has been the effective death of the traditional billable hour pricing model in most law firms,” the report says. “Plainly, the imposition of budget discipline on law firm matters forces firms to a very different pricing model than the traditional approach of simply recording time and passing the associated ‘costs’ through to the client on a billable-hour basis.”

Read the ABA Journal article.

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Reuters is reporting that Japan’s Takata Corp is expected to plead guilty to criminal wrongdoing as Friday as part of a $1 billion settlement with the U.S. Justice Department over its handling of air bag ruptures linked to 16 deaths worldwide, sources said.

David Shepardson writes that the settlement includes a $25 million criminal fine and $125 million in victim compensation. He added that his sources told him the settlement also will include  $850 million to compensate automakers who have suffered losses from massive recalls.

“The company is poised to plead guilty to wire fraud, or providing false test data to U.S. regulators, according to the sources, who were not authorized to discuss the settlement publicly,” according to the report.

Read the Reuters article.

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Navex Global will present a free webinar discussing how a new administration and anticipated enforcement and regulatory changes will impact third party due diligence programs.

The event will be Thursday, Jan. 26, at 1 p.m. EST (10 a.m. PST).

Topics will include:

• Potential impacts of the Trump administration on compliance
• Changes to FCPA enforcement approaches
• Disgorgement trends
• Yates Memo impacts
• Upcoming regulatory changes

Participants also will techniques and technology to help mitigate political and regulatory turmoil with a risk-based approach to modernizing due diligence.

Speakers will be Michael Volkov, CEO, Volkov Law Group, LLC; and Tim Morss & Chris Bailey, of NAVEX Global.

Register for the webinar.

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By Christopher Barnett
Scott & Scott LLP

Companies with experience licensing Microsoft software and services through Enterprise Agreements know that small forests could be felled to produce the paper required for the typical document stack. EAs often incorporate a dozen or more different components, including some or all of the following:

• Microsoft Business and Services Agreement or Microsoft Business Agreement (Microsoft sometimes will agree to use existing master agreements)
• Online Services Supplemental Terms and Conditions (if an existing, older-form master agreement is to be used)
• Enterprise Agreement (Microsoft sometimes will agree to use existing base EAs)
• Enterprise Enrollment
• Customer Price Sheet
• Product Selection Form
• One or more custom terms amendments (if custom terms have been negotiated)
• One or more standard-form amendments (to cover product-specific or service-specific matters for which Microsoft offers off-the-shelf terms)
• Product Terms (typically incorporated by reference)
• Online Services Terms (typically incorporated by reference)
• Service Level Agreement for Online Services (sometimes incorporated by reference)
• Supplemental Contact Information Form
• Tax Terms and Conditions Form
• Signature Form

Many of the standard forms are administrative in nature and rarely incorporate substantive terms or conditions. However, Microsoft occasionally will incorporate substantive or potentially substantive language in forms that otherwise would appear to have only administrative purposes. A good example is the Customer Price Sheet (CPS).

The primary purpose of the CPS is to list the products and services being ordered under an EA, the order quantities, and the prices to be paid. The CPS also typically identifies the prices that will apply to true-up orders during the term as well as end-of-term buy-out prices for subscription licenses.

Toward the end of the CPS, there usually are included sections labeled “Product Notes” and/or “Terms and Conditions.” Ideally, those sections should be used exclusively to help navigate the CPS and to clarify any custom license metrics that may apply to the EA transaction. However, Microsoft sometimes will include language in those sections that should be the subject of legal negotiations or even that contradicts substantive terms that may have agreed in a custom terms amendment. For example, the parties may reach a special agreement regarding the mechanics for placing incremental true-up orders, but the notes in the CPS may reference standard true-up procedures. This can be especially problematic in time-sensitive negotiations, because the CPS often is among the last documents to be finalized for legal review and approval.

Businesses neglect a thorough review of all EA document components at their peril. Business and legal teams need to push early and often to insist that Microsoft circulate final-form versions of each and every part of the document stack as soon as possible to ensure a smooth transaction. Those teams also need to be prepared to scrutinize every page of that stack to ensure that there are no surprises that are inconsistent with the business’s expectations.

Practical Law will present a free 60-minute webinar reviewing the year in M&A. During the webinar, Daniel Rubin, Senior Editor, Practical Law Corporate and M&A, will analyze what’s market data and review critical M&A trends, unique transactions and highlights from 2016 that may affect your practice in 2017.

The event will be Wednesday, Feb. 1, at 1 p.m. EST.

The presenter will discuss:

• Trends in deal size and deal volume among strategic and financial buyers, including the year’s swell of busted deals.
• The use of cash and stock consideration in public M&A deals in 2016.
• The continuing influence of shareholder activism on the M&A market.
• Legal developments and trends from 2016 that will influence deal-making in 2017.
• And more.

Also, participants may check out What’s Market, which provides a continuously updated database of agreements covering a range of corporate, securities, finance and commercial topics, including public merger agreements and spin-offs. In the public merger agreements database, readers can analyze and compare negotiated terms, such as fiduciary outs, matching rights, termination fees and pricing collars, across multiple deals. What’s Market also contains links to the underlying public documents.

A short Q&A will follow.

Presenter:
Daniel Rubin, Senior Legal Editor, Practical Law Corporate and M&A

Following the webinar, email links will be provided to these Practical Law resources:

Making Good Use of Special Committees.
Preparing a Portfolio Company for Sale.

Register for the webinar.

Two of the nation’s largest credit reporting bureaus, TransUnion and Equifax, will together pay more than $23 million in fines and refunds to settle charges from a federal consumer watchdog that they misled consumers about the pricing and value of credit products, according to a Washington Post report.

The Consumer Financial Protection Bureau said the companies deceived consumers by suggesting that the credit scores they provided were the same scores used by financial firms to make lending decisions when in fact, the scores “were not typically used by lenders,” reports Jonnelle Marte.

Some of the companies’ products offered as free, or as costing $1, in fact incurred monthly charges adding up to almost $200 a year, the CFPB claimed.

Read the Washington Post article.

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Jeb Hensarling
Image by Gage Skidmore

Dismantling President Obama’s financial reform law is not a priority for President-elect Trump’s first 100 days, the author of GOP legislation to undo the law said Thursday, but it is a task for Trump’s first year, reports The Washington Examiner.

Jeb Hensarling, the chairman of the House Financial Services Committee, said he’s discussed ditching the law with Trump, writes Joseph Lawler.

“The president-elect committed to dismantle Dodd-Frank. It’s going to happen in the first year.”

Hensarling has said that some of the law could be dismantled through executive action and more could be undone using budget reconciliation.

Read the Examiner article.

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There is perhaps no area where the impact of artificial intelligence (AI) systems (i.e., systems that exhibit intelligent behavior) will be felt more than in legal departments and, more broadly, in the area of managing contracts, according to an article in Spend Matters.

“Every commercial contract is like a little knowledge base that contains critical data on organizational commitments (usually legal obligations), rights, remedies and rules that reflect business decisions made in the past that will affect performance in the future,” writes Pierre Mitchell. “Unfortunately, the amassed collection of thousands of these artifacts does not provide a ‘collective intelligence’ that can be used efficiently to reduce commercial risks and increase economic value for the firm.”

In this first part of a series, Mitchell discusses three basic steps for building commercial intelligence.

Read the article.