Johnson & Johnson and its DePuy unit were ordered by a Texas federal jury on Thursday to pay about $500 million to five plaintiffs who said they were injured by Pinnacle metal-on-metal hip implants, Reuters reports.

Jurors deliberated for a week before finding that the Pinnacle hips were defectively designed, and that the companies failed to warn the public about their risks. The verdict at the conclusion of the two-month trial called for about $140 million in total compensatory damages and about $360 million in punitive damages.

A J&J spokeswoman said the company will appeal.

Mark Lanier of The Mark Lanier Law Firm, with offices in Houston, New York and Los Angeles, was lead trial counsel for the plaintiffs.

Read the article.

Electronic signatures are in use across the globe, reports eSignLive in a new ebook the company has made available for complimentary downloading. (The download form is below.)

The widespread adoption of e-signatures has been supported by electronic signature laws around the world, including the Americas, Europe, Middle East, Africa and Asia-Pacific. Many of these are based on a model law enacted by the United Nations Commission on International Trade Law – Model Law on Electronic Signatures (2001).

Today there are more than 75 countries that recognize the legal validity of e-signatures. This eBook provides an introduction to electronic signature laws around the world, including:

• The three forms of electronic signatures – Basic, Advanced and Certificate/Qualified E-Signatures;
• A list of e-signature types allowed by each country;
• Links to resources such as the Database of Electronic Signature Legislation;
• Information about data residency and privacy laws.

Download the ebook:

One of the most critical and important contracts a startup can focus on, and do correctly, is to properly license IP from a university so that it can be commercialized going forward, according to a video prepared by Peter Buckland of Wilmer Cutler Pickering Hale and Dorr LLP.

He explains that a common question he hears from entrepreneurs is about how to work with technology that they created at their universities, going forward in a commercial endeavor.

“In most cases, anyone that is in anyway being paid by a university to do research, the university owns that research and for many of the universities we work with in this area, whether it’s Stanford or Cal or others, they’re all pretty in tune with their mandate, which is to commercialize that technology,” he says in the video. And the best way to do that, he adds, is to partner with the people who created that technology.

Watch the video.

“Sometimes, accidents just happen,” a lawyer for General Motors Co. told a U.S. jury in defense of the carmaker at a test trial over a deadly flaw in millions of ignition switches, according to a BloombergBusiness report.

The accident involving a collision on a New Orleans bridge during a January 2014 ice storm is at the center of a case that could affect the outcome of hundreds of other GM ignition switch cases.

“The trial is the second of six bellwether cases, so called because they are used to test strategies,” Bloomberg reports. “The jury’s reaction to the evidence may push either side to settle — or battle out — hundreds of other cases and help set the size of any settlements.”

Read the article.

Bankruptcy Judge Shelley Chapman held that Sabine Oil & Gas Corp. has satisfied the standards for rejection of several gathering and handling agreements between Sabine and its midstream counter-parties, Nordheim Eagle Ford Gathering, LLC and HPIP Gonzales Holdings, LLC, report Ron D’Aversa and Douglas Mintz of Orrick, Herrington & Sutcliffe LLP in an article posted by JDSupra.com.

The authors say the ruling has limits, and the matter ultimately turns on whether certain covenants “run with the land” under Texas law.

“While the Court held that Sabine exercised reasonable business judgment in rejecting the agreements, the Court declined to decide ‘in a binding way the underlying legal dispute with respect to whether the covenants at issue run with the land,’ and instead offered a ‘non-binding’ analysis to determine the reasonableness of Sabine’s rejection. Thus, if the counter-parties can demonstrate that the covenants do run with the land in an adversary proceeding, Sabine may not be able to terminate those covenants,” according to the article.

Read the article.

Opening arguments kicked off Thursday in a long-awaited National Labor Relations Board case that could, for the first time ever, put McDonald’s on the hook for labor violations committed by the company’s franchised restaurants, reports International Business Times.

The case could determine whether McDonald’s is a so-called joint employer of workers at its franchisees, the independently-owned businesses that make up 90 percent of the company’s roughly 13,000 stores in the U.S and employ the vast majority of its 420,000 workers, explains reporter Cole Stangler.

“In addition to making the company more liable for labor violations, a decision from the NLRB that McDonald’s is a joint employer would open the door for a union formed by workers at franchised stores to bring the parent company to the bargaining table,” according to the report. “Such a ruling could also set a precedent for other fast-food franchises, according to industry observers and legal experts.”

Read the article.

The U.S. Department of Justice filed a legal response on Thursday to Apple’s refusal to help the FBI unlock an iPhone used by one of the San Bernardino shooters, and Apple quickly responded, with general counsel Bruce Sewell delivering a tense and angry response in a conference call with reporters, reports Business Insider.

Sewell called the DOJ response a “cheap shot” and said that its tone “reads like an indictment.”

He was responding to the DOJ’s claim that “Apple’s rhetoric is not only false, but also corrosive of the very institutions that are best able to safeguard our liberty and our rights … .”

Read the article.

According to 10 judges of the Federal Circuit, a patent owner’s right to sue for infringement in the United States is not exhausted by sales of products abroad or by sales subject to valid post-sale contractual restrictions on use, write David Tellekson, Stefan Szpajda and Phillip K. Decker of Fenwick & West LLP.

The case is Lexmark Int’l, Inc. v. Impression Prods, Inc., Nos. 2014-1617, slip op. (Fed. Cir. Feb. 12, 2016).

In a 10-2 en banc decision, the Circuit court held that U.S. patent rights need not be expressly reserved in foreign sales transactions to preserve the right to sue for infringement if the goods enter the United States downstream of the point of sale.

“Although the Federal Circuit’s decision purports to maintain the status quo regarding patent exhaustion, Lexmark has immediate implications for patentees, licensees, and downstream consumers alike,” the authors write.

Read the article.

Tuesday, March 29, 2 p.m. EST
(register below)

eSignLive by Vasco is sponsoring an online presentation featuring one of the foremost e-signature law experts, Margo Tank, partner from BuckleySandler LLP, offering a unique look at e-signatures and answering the most frequently asked legal questions on the topic.

The complimentary webinar will be Tuesday, March 29, at 2 p.m. Eastern time.

Andrea Masterton, Corporate Marketing Director of eSignLive, will be featured.

The event will cover:

• Are electronic signatures and records legal across the United States?
• What legal and compliance requirements do we need to consider?
• Are there any exclusions or exceptions?
• What have we learned from e-signature case law?
• What special considerations should global companies be aware of when using e-signatures in other countries?

Register for the webinar here:

Soft-spoken and bookish litigator Elizabeth Cabraser stood out from the cloud of alpha lawyers when made her low-key pitch to a federal judge as to why she should be selected to lead a massive consumer-fraud case against Volkswagen AG, reports The Wall Street Journal, via NASDAQ.

Her eloquence and focus on the clients contrasted with dozens of others who pitched the judge that day, bragging about their most recent newspaper awards, school credentials and trial prowess, the report says.

“U.S. District Judge Charles Breyer hours later named Ms. Cabraser to lead a team of 21 lawyers handling the plaintiffs’ cases, which consolidate more than 500 lawsuits. Volkswagen has admitted its diesel cars were installed with software meant to trick emissions tests and is working with regulators on a fix,” according to the report.

“The San Francisco Bay Area native has built a reputation for her encyclopedic knowledge of class-action law, effectiveness in oral arguments, and ability to diplomatically manage large cases, lawyers say.”

Read the story.

By Rob Scott
Scott & Scott LLP

I am a technology lawyer representing banks and other financial institutions in technology transactions. As you might imagine, many of my clients are investing heavily in security products and services. In some instances, they are considering cloud solutions to enhance their customers’ experiences. Financial institutions are regulated by the Gramm, Leach, Bliley Act, (“GLBA”) which is codified at 16 CFR 314. GLBA defines financial institutions as all business, regardless of size, that are significantly engaged in offering financial goods or services. GLBA includes both privacy and safeguard rules related to customer information. These rules require financial institutions to implement adequate administrative, procedural, and technical safeguards designed to safeguard customer information.

What is a service provider under GLBA Safeguard’s Rule?

GLBA extends to the financial institution’s vendors by operation of law if the vendor meets the definition of service provider. A service provider is defined as:

Any party that is permitted access to a financial institution’s customer information through the provision of services directly to the institution.

Given the complexity of hosted and cloud based services, it is sometimes difficult to determine if a vendor meets the service provider definition under GLBA. This is an important threshold issue in any transaction because GLBA has specific rules regarding vendor due diligence and required contract provisions for contracts with service providers.

What is customer information under GLBA Safeguard’s Rule?

At the beginning of a new project, counsel should discuss the potential operational and legal risks of the proposed transaction. It is critical to understand where the data will reside and how it will be moved, shared, and stored. Counsel should keep probing until clear on the question of whether the proposed transaction involves customer information as that term is defined under GLBA 16 C.F.R. 313(n) which provides:

(n)
(1) Nonpublic personal information means:
(i) Personally identifiable financial information; and
(ii) Any list, description, or other grouping of consumers (and publicly available information pertaining to them) that is derived using any personally identifiable financial information that is not publicly available.

(2) Nonpublic personal information does not include:
(i) Publicly available information, except as included on a list described in paragraph (n)(1)(ii) of this section; or
(ii) Any list, description, or other grouping of consumers (and publicly available information pertaining to them) that is derived without using any personally identifiable financial information that is not publicly available.

(3) Examples of lists —
(i) Nonpublic personal information includes any list of individuals’ names and street addresses that is derived in whole or in part using personally identifiable financial information (that is not publicly available), such as account numbers.
(ii) Nonpublic personal information does not include any list of individuals’ names and addresses that contains only publicly available information, is not derived, in whole or in part, using personally identifiable financial information that is not publicly available, and is not disclosed in a manner that indicates that any of the individuals on the list is a consumer of a financial institution.

I look to 313(n) for the definition of customer information even though it is in the GLBA Privacy Rule. The GLBA Safeguards Rule’s definition of customer information is contained in 16 CFR 314.2 and reads as follows:

Customer information means any record containing nonpublic personal information as defined in 16 CFR 313.3(n), about a customer of a financial institution, whether in paper, electronic, or other form, that is handled or maintained by or on behalf of you or your affiliates.

Therefore, I have to understand whether the vendor will be permitted access to any record containing personally identifiable financial information or any list, description or grouping derived using personally identifiable financial information. If I conclude that that data in question includes personally identifiable financial information then I continue to the next line of questions.

What is permitted access under GLBA?

After determining whether or not customer information is at risk, counsel should evaluate the proposed architecture and service delivery options. These questions may include: How the vendor will deliver services? Where are the applications hosted? Who owns the hardware? To properly apply the GLBA safeguards rules, everyone should understand how the vendor will interact with customer data throughout the project life cycle. It is usually pretty easy to determine whether the vendor will be permitted access to customer data if they are hosting in the vendor’s cloud. More difficult permission cases include service and support of on-premises applications where service providers are given access to customer data to trouble-shoot or resolve issues. I assume all vendors whose applications store customer information to be service providers under GLBA’s safeguards rule unless I am convinced otherwise during the client interview. Rarely, the client will present a use case involving an on-premises deployment of an application where the vendor never has access to the application. Most of the time, even when on-premises deployments are further evaluated, the vendor is a service provider because they are permitted access to the application during implementation or when performing maintenance and support. A vendor is not a service provider under GLBA merely because a compromise of the vendors system could lead to access to customer data. Accordingly, the GLBA safeguards rule is triggered only when access is given by permission, either through the contract or operationally.

Transactions between financial institutions and their technology services providers are often regulated by GLBA. Lawyers need to determine whether the transaction involves personally identifiable financial information and if so, whether the vendor will ever be permitted access to any records at any time. These two issues will determine whether the vendor is a service provider under GLBA’s Safeguards Rule. Once the determination has been made, GLBA imposes numerous additional requirements for both the service provider and financial institution.

The statute of limitations on an unsuccessful job applicant’s Fair Credit Reporting Act claim began to run when he discovered that his credit report had been pulled, not when he learned that the employer’s action was an FCRA violation, according to the U.S. Court of Appeals for the Sixth Circuit.

Richard A. Roth wrote in Wolters Kluwer‘s Law & Business website that the general rule is that a statute of limitations begins to run when the facts giving rise to a claim are discovered, and the FCRA adheres to that general rule. The case is Rocheleau v. Elder Living Construction, LLC, Feb. 18, 2016, Siler, E.

“The job applicant asserted that the two-year limit began to run not when he discovered that the background report had been ordered but rather when he discovered that doing so was an FCRA violation,” Roth explained. But the appellate court disagreed.

Read the article.

Businesspeople spend a lot of time and take a lot of pride negotiating deals, points out lawyer and author Jack Garson in the Huffington Post.

“They high-five when they get key points. But understand what it takes to win if there is a fight later. You only win a ‘feel-good’ battle in the negotiation. You win the real war in the contract. That’s where the killer contract clauses rule,” he writes.

He provides examples of contract language  that can make a contract much more favorable. “Contracts and the law are not about common sense. They’re about rules. Know them and win. Ignore them and forget about retiring on time.”

Read the article.

Checkpoint Systems, Inc., a leading global supplier of merchandise availability solutions for the retail industry, has announced that it has entered into a definitive agreement to be acquired by an affiliate of CCL Industries Inc., a world leader in specialty label and packaging solutions for global corporations, small business and consumers, for $10.15 per share in cash, for a total transaction value of approximately $443 million. The transaction is subject to specified closing conditions, including approval by a majority of Checkpoint’s shareholders.

Latham & Watkins LLP represents Checkpoint in the transaction with a corporate deal team led by partners Charles Ruck and Thomas Malone in New York, partner Joel Trotter in Washington, D.C. and associate Michael Young in Orange County, with associates Jeffrey Holgate, Amro Suboh, Brett Urig, Michael Daniels, Kristen Juhan, Philip Houten and Wesley Horton in Orange County and Jessica Munitz in Washington, D.C. Advice was also provided on antitrust matters by partners Michael Egge and Jason Cruise and counsel Farrell Malone with associate Brady Cummins in Washington, D.C.; on benefits and compensation matters by partner Adam Kestenbaum with associate Marysia Mullen in Washington, D.C.; on intellectual property matters by counsel Kieran Dickinson in Washington, D.C.; on tax matters by partner David Raab with associates Matthew Dewitz and Aaron Bernstein in New York; and on environmental matters by partner Christopher Norton in Orange County.

A Checkpoint release describes the deal:

Checkpoint’s board of directors has unanimously approved the merger agreement and recommends that its shareholders vote to approve the merger agreement. Checkpoint expects to hold a special meeting of its shareholders to consider and act upon the proposed merger as promptly as practicable. Details regarding the record date for, and the date, time and place of, the special meeting will be announced when finalized.

“This transaction represents a highly attractive premium for Checkpoint’s shareholders,” said Checkpoint Systems President and Chief Executive Officer, George Babich. “CCL is a recognized global leader in labeling and packaging. Checkpoint, as a division of CCL upon closing, will be able to invest in and grow Checkpoint’s industry leading hardware, software and consumables to create a unique offering, the future of inventory management for brand owners and leading retailers worldwide,” said Mr. Babich.

In connection with this transaction, Morgan Stanley & Co. LLC is serving as financial advisor and Latham & Watkins LLP and Stradley Ronon Stevens & Young, LLP are serving as legal counsel to Checkpoint.

Checkpoint will file with the Securities and Exchange Commission a report on Form 8-K regarding the transaction, which will include the merger agreement.

TMF Group has made available for free download the new Benchmark Complexity Index 2015 – a global study of corporate governance.

TMF Group’s report ranks jurisdictions according to their complexity from a corporate secretarial perspective, and is based on results from a survey conducted across TMF Group offices. In addition, it summarizes and comments upon regional differences, providing insight into the factors which influence complexity in corporate secretarial compliance around the world.

The company says the report covers:

• The relative complexity of maintaining compliance around the world.
• What’s driving the changes in different jurisdictions.
• The value of local knowledge and expertise in understanding the nuances of a market complexity.

Download the report.

Smart contracts today may be similar to e-commerce in the 1990s – poised for widespread adoption and explosive growth even though it may still be a few years off, writes Oliver Herzfeld, chief legal officer of  Beanstalk, in an article published on Forbes.com. So, to avoid surprises or missed opportunities, it may be worthwhile to start now to consider and explore the possible applications of smart contracts to your industry and business.

“Essentially, a smart contract is software that executes commercial transactions and/or enforces legal agreements in a manner that eliminates the need for intermediaries and their associated transaction costs,” he explains.

Herzfeld adds that this system could have “a huge disruptive effect on (i) car manufacturers, since use optimization would presumably reduce sales; (ii) insurance companies, that would sell fewer car policies; (iii) financial institutions, that would underwrite fewer car loans; and (iv) taxi and ride hail companies, parking facilities and other businesses, that would all be displaced by this process. The resulting commercial and social disruption could be huge.”

Read the article.

The death of Supreme Court Justice Antonin Scalia has prompted Dow Chemical to settle a class action lawsuit and pay out $835 million, reports CNN.

“The case involved an allegation that Dow and other makers of a chemical known as urethane had conspired to fix prices between 1999 and 2004,” the report says. “Other defendants in the case settled with the plaintiffs but the case against Dow went to a jury trial.”

Dow was facing a $1.1 billion judgment in a price fixing case, and the company was appealing the verdict all the way to the Supreme Court. But now Dow Chemical says it no longer thinks it could win its appeal without Scalia on the bench.

Read the article.

Volkswagen has been given until March 24 to present an acceptable fix for bringing nearly 600,000 diesel cars into compliance with clean air laws, reports DW Akademie.

U.S. District Judge Charles Breyer told the car maker at a court hearing in San Francisco on Thursday that he has a “sense of urgency” about seeing a resolution.

The company has already admitted to using software that covers up the fact that some of their cars emit up to 40 times legally allowable emissions in vehicles sold since 2009.

Read the article.

Kirkland & Ellis LLP advised EIG Global Energy Partners on its $500 million equity commitment, on behalf of EIG managed funds, to Rice Midstream Holdings LLC, a midstream-focused subsidiary of Rice Energy Inc. and the indirect owner of the general partner of Rice Midstream Partners LP (NYSE: RMP). Rice announced the completion of an initial funding of $375 million of this investment. The full release is available here.

The Kirkland team was led by corporate partners Andy Calder and John Pitts; capital markets partner Matt Pacey; and debt finance partners Will Bos and Mary Kogut.

Barclays Capital Inc. acted as financial advisor and Vinson & Elkins L.L.P. served as legal counsel to Rice.

RMH will use approximately $75 million of the proceeds to repay all outstanding borrowings under its revolving credit facility and to pay transaction fees and expenses, and the remaining $300 million will be distributed to Rice Energy to fund a portion of its 2016 development program in the cores of the Marcellus and Utica Shales, Rice Energy said in a release. In addition, RMH will have an additional $125 million commitment from EIG (subject to designated drawing conditions precedent) for a period of 18 months.

Read more about the deal.

The en banc Federal Circuit by a vote of 10-2 held that patent exhaustion can be avoided by otherwise lawful post-sale contractual restrictions and that foreign sales of a patented item are not presumed to exhaust patent owner’s rights in the United States, according to a report posted by Dentons.

The case is Lexmark Int’l, Inc. v. Impression Products, Inc., No. 14-1617, -1619 (Fed. Cir. Feb. 12, 2016) (en banc).

“The dissent would have found post-sale restrictions invalid and that foreign sales exhaust patent owner’s rights in the United States absent an express reservation. The Federal Circuit’s 99-page majority decision may not be the last word on these issues if the Supreme Court is asked to grant certiorari later this year,” wrote Joel N. Bock, Joshua D. Curry and Heather Khassian.

Read the article.