The California Supreme Court invalidated a mandatory arbitration agreement involving a former employee’s wage claims, finding the agreement was both procedurally and substantively unconscionable, according to a Ford Harrison post by partner Frederick L. Warren.

“The Court found that the arbitration agreement’s execution involved a high degree of procedural unconscionability,” explained Warren. “The Court stated that ‘the agreement appears to have been drafted with an aim to thwart, rather than promote, understanding.'”

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Regina Campbell offers an overview of the three types of contracts and agreements that companies should consider using.

Writing on Lawyers. com, Campbell, of The Campbell Law Group, discusses employee agreements, advising that companies should use an at-will agreement that clearly states that a new hire’s employment can be terminated at any time for any reason.

She also discusses vendor agreements and independent contractor agreements.

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Even if an errors and omissions policy contains a breach of contract exclusion, coverage may be available in a breach claim, depending on the circumstances and applicable law, writes Charles P. Edwards for Barnes & Thornburg.

Writing in the firm’s Policyholder Protection blog, Edwards discusses a recent court ruling involving coverage for a breach of contract claim brought against a corporate policyholder by one of its customers.

The article also covers two other similar cases.

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A distribution agreement is a legally binding contract between a seller of goods and a distributor that outlines the details involved in the sale and transfer of goods, explains Regina Campbell of The Campbell Law Group.

“By having a distribution agreement, businesses save time and money by avoiding misunderstandings that affects the profitability of each party and preventing future litigation over disputes,” she writes in a post on Lawyers.com.

In the post, she discusses the mistakes, which involve not using a distribution agreement, attempting to distribute too much, too fast, failing to specify whether the agreement is exclusive, lack of termination clauses, and lack of renewal language.

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A post on the website of Bryan Cave Leighton Paisner discusses a key component of contract obligation management – increasing obligation tracking and traceability.

“Conducting that evaluation of your existing contracts will allow you to identify risks and opportunities for negotiation of new contracts and allow you to better marry any potential technical obligation management tools to your contract environment, potentially turning in-house teams from SG&A on the income statement into their own profit center,” according to the post.

The article discusses reporting and recordkeeping, along with information, auditing, in detail.

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Three recent court decisions raise a few issues to keep in mind for employers to keep in mind when drafting arbitration agreements for employees, according to a post on Bradley Arant Boult Cummings’ Labor & Employment Insights blog.

The authors, Bridget Warren and Anne R. Yuengert, discuss the common characteristics that an agreement should include.

They also advise drafters to include class and collective action waivers and how to update existing agreements to include such a waiver while a lawsuit is pending.

Finally, they advise paying attention to state laws that affect what can be included in the arbitration agreement.

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A recent FTC enforcement action clarifies the requirements for non-compete clauses in M&A agreements to fulfill certain requirements to comply with antitrust and competition laws, and serves as a reminder that U.S. antitrust authorities are actively reviewing these provisions, according to Orrick’s Antitrust Watch blog.

In the case, the Federal Trade Commission took issue with the non-compete clause in a purchase and sale agreement, which would have prohibited one seller from competing with the natural gas pipeline for three years.

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The U.S. Court of Appeals for the 4th Circuit held that a subrogation waiver provision in a construction contract barred an association’s insurance company from seeking to recover from an allegedly negligent contractor, reports Daniel Miske in the Husch Blackwell Association Alert.

He describes the case of United National Insurance Company v. Peninsula Roofing Company, Inc., which involved $3 million in damages to a condominium complex caused  by a contractor’s generator. The association’s insurer sued the contractor for negligence, gross negligence, and breach of contract.

After detailing the appellate court’s ruling, Miske presents four lessons a practitioner can learn from the case.

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Contract Logix, a provider of intelligent contract management software, announced its Premium platform has been selected by Rx Savings Solutions, a provider of  cost-saving solutions for prescription drug purchasing, to streamline and scale contract management while improving visibility and control over its processes.

The company said the solution from Contract Logix will allow for increased automation and efficiency in the contract management, while also enforcing governance and compliance.

The Contract Logix Premium platform was selected by Rx Savings Solutions to manage both the pre- and post-execution phases of its contract management. The manual contract processes that Rx Savings Solutions previously used became too difficult to maintain due to the company’s tremendous growth. The solution from Contract Logix will enable them to securely centralize their contracts and related data in single contract repository and more efficiently request, create, negotiate, execute, and manage agreements.

Drinker Biddle & Reath’s The Restricting Covenant series takes a look at two states’ competing views on the enforceability of restrictive covenants and the critical importance of conducting a “choice of law” analysis to settle this feud.

Author Lawrence Del Rossi explains the backstory: “With respect to restrictive covenants, the conflict between Delaware, which is generally considered a ‘pro-enforcement’ jurisdiction, and California, which is generally considered an ‘anti-enforcement’ jurisdiction, definitely stands out in the crowd.”

The article compares freedom to contract versus freedom from restraints on trade and finds some common ground coast-to-coast.

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A post in the Burns Levinson In-House Advisor blog takes a look at the use of multi-tiered pre-litigation dispute resolution clauses in contracts.

Author Shepard Davidson writes that the theory behind such mechanisms “is straight-forward and quite laudable: if the parties can resolve a dispute without resorting to litigation or arbitration, they likely will save themselves a lot of pain, anxiety and, most of all, money. In reality, however, forcing people to engage in settlement discussions may actually cause one party or the other to lose substantive rights.”

He concludes that forcing parties to engage in a process that only can work if all of them want to participate seems unlikely to result in anything other than delay and added expense.

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Two authors writing for Harvard Business Review present a case for companies adopting so-called relational contracts.

In a recorded discussion, Oliver Hart, Nobel-winning Harvard economist, and Kate Vitasek, faculty at the University of Tennessee, argue that many business contracts are imperfect, no matter how bulletproof you try to make them.

Their research shows that creating a general playbook built around principles like fairness and reciprocity offers greater benefits to both businesses.

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A recent federal court decision reminds employers that an employee’s electronic acceptance of an arbitration agreement may not, by itself, be enough to prove that the employee has agreed to arbitrate, points out Stokes Wagner post.

In Shockley v. PrimeLending, the U.S. Court of Appeals for the Eighth Circuit recently affirmed the lower court’s decision to deny the employer’s motion to compel arbitration where the arbitration agreement was signed via the employer’s automated intranet system.

The author, Jordan A. Fishman, discusses the reasons that acceptance via intranet system was insufficient.

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Because Enterprise Resource Planning implementation and software licensing contracts are as complicated as the software itself, there are a number of key things for general counsel to keep in mind as they review these contracts, according to a post on the Taft Technology Insights blog.

Author Marcus Harris offers a guide to negotiating and drafting contracts for ERP software systems, discussing seven main areas where companies slip up most-frequently.

The areas include: specify the vendor as the expert, detail liability, define responsibility, put everything in the contract, watch out for contractual remedies, and have a mechanism for controlling scope.

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A post on the Tech & Sourcing blog of Morgan Lewis provides a checklist of common workstreams to consider inn outsourcing and managed services transactions.

Authors Barbara Murphy Melby and Kevin P. Dermody discuss governance, planning, people and asset transfers, resource mobilization, operations, processes and documentation, infrastructure and security enablement, networks, change and communications management, and third-party contracts disposition management.

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A recent Delaware case serves as a reminder that a murky path to a signed agreement and lack of good record-keeping can lead to a finding of non-enforceable contracts, according to a post in the Taking Care of Business blog of White and Williams.

Authors Lori Smith and Gwenn Barney discuss a case in which an independent contractor for a company negotiated an arrangement to buy shares in the company. Although, both parties believed they had signed an agreement in 2007, because of the manner in which the drafts and signature pages were exchanged, the parties had differing understandings and recollections of what had actually been agreed upon.

The lack of any record trail, or “hard evidence,” in this case (other than the various drafts) made it difficult to find clear evidence of a meeting of the minds, the authors explain.

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In Seyfarth’s fourth installment in its 2019 Trade Secrets Webinar Series, Seyfarth attorneys Kristine Argentine, Eric Barton, and Katelyn Miller focused on the enforcement of non-competes and how the difficulty of enforcement of these restrictive covenants vary by state, especially based on recent legislation in various states.

The post includes a link to the webinar for on-demand viewing.

It also includes a summary of takeaways from the discussion.

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Contract damages can be a great thing in a China contract, but only if done right, according to Dan Harris, writing in the Harris Bricken China Law Blog.

He explains that the term “contract damages” refers to a contract provision setting out the damages for breach. In the standard commercial contracts his firm writes for clients, the agreements usually include a specific damage amount for certain (but not all) violations of the contract terms.

“The only constant is that we try to make the amount as high as we can, while at the same time erring on the side of keeping it low enough so that it will actually work to scare the Chinese company into not breaching the contract,” Harris writes.

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A legal victory for Delta Air Lines this year is unique in that it is the first time that a court has determined that a business owes no obligation of privacy to a customer because its privacy policy explicitly disclaims any type of contractual relationship between the business and its customers, writes Sunrita Sen in the Frost Brown Todd fbtTech Blog.

The case involved a breach of contract claim over the data breach suffered by the airline in 2017.

A U.S. district judge dismissed the claim, agreeing with Delta that the Airline Deregulation Act preempted the plaintiff’s breach of contract claims.

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A recent case from the National Labor Relations Board shows that American labor law, including principles that apply to collective bargaining agreements, is not always as straight-forward as basic contract law, points out Barnes & Thornburg in a recent post.

The contract included a clause setting “longevity pay increases” for workers who reached certain tenure milestones with the company.

“The employer and union were meeting to negotiate a successor contract, and the agreement expired in the interim,” explains David J. Pryzbylski. “Once the labor agreement expired, the company ceased offering longevity pay increases on grounds that there was no agreement in effect that provided for such increases.”

The NLRB, however, found that a company generally must continue to offer employees the terms set forth under a collective bargaining agreement when it expires and while negotiations for a new contract are underway.

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