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When To Call Your Lawyer: A Seminar for Business Owners & Executives Presented By: Stefanie R. McNamara, Esq. Rikki L. Field, Esq. Annmarie Simeone, Esq.

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Presentation on theme: "When To Call Your Lawyer: A Seminar for Business Owners & Executives Presented By: Stefanie R. McNamara, Esq. Rikki L. Field, Esq. Annmarie Simeone, Esq."— Presentation transcript:

1 When To Call Your Lawyer: A Seminar for Business Owners & Executives Presented By: Stefanie R. McNamara, Esq. Rikki L. Field, Esq. Annmarie Simeone, Esq. Andrea S. Glaser, Esq. Margaret Raymond-Flood, Esq. Melinda Fellner Bramwit, Esq. The material provided herein is for informational purposes only and is not intended as legal advice or counsel.

2 2 Please help yourself to food and drinks Please let us know if the room temperature is too hot or cold Bathrooms are located past the reception desk on the right Please turn OFF your cell phones Please complete and return surveys at the end of the seminar

3 Contract Trouble Spots Presented By: Stefanie R. McNamara, Esq.

4 4 Indemnification Contractual Risk Allocation Scope – typically acceptable –Breach of Agreement –Misrepresentation –Fault – negligence or willful misconduct Survival Limits on Liability –Caps and deductibles Mutual or Unilateral

5 5 Warranty Scope – What is the warranty? –Narrow - Meets specs –Broad - Fit for purpose intended Time Frame Standards –Services –Products/Goods Remedy

6 6 Ownership Of Intellectual Property What do you own? –Pre-existing IP –Newly developed IP What do they own? Joint ownership? Don’t just give it away!

7 7 Assignment Have a third party perform the contract Do you need the ability to assign the contract? Are you willing to grant the other party the right to assign the contract? Any issues with assignment to a competitor?

8 8 Term And Termination Automatic or Evergreen renewal? Right to terminate without cause or for convenience Other rights to terminate needed? –Force Majeure Event –Increase in price of materials –Breach

9 9 Restrictions Necessary? Confidentiality Non-Solicitation Non-Compete

10 When Commercial Tenants Should Call Their Lawyer Presented By: Rikki L. Field, Esq.

11 11 Preliminary Comments Rights and obligations determined primarily by contract Most statutory protections available to residential tenants not applicable to commercial tenants, e.g. Anti-Eviction Laws and Security Deposit Rights

12 12 Space Is Too Big Or Small Assignment (transfer of entire interest in Lease for the balance of lease term) Sublease (lease of a portion of leased premises for all or part of remaining lease term) –Tenant becomes sublandlord to subtenant

13 13 Landlord’s Consent Check your lease Typically, landlord’s consent is required in order to assign lease or sublease leased premises Some leases provided “Landlord’s consent shall not be unreasonably withheld”

14 14 What Is “Reasonable”? Landlord may only consider matters that are related to ownership or operation of the particular property –Financial solvency of proposed subtenant –Nature and suitability of proposed subtenant’s business for premises and area –Subtenant’s guarantee

15 15 What Is “Unreasonable”? Matters that are not related to ownership or operation of the particular property –Proposed subtenant is a tenant in another building owned by Landlord –Desiring higher rents

16 16 Other Provisions Some leases give Landlord right to recapture Some leases give Landlord right to all or part of any increase in rent Usually, tenant remains liable after assignment and/or sublease

17 17 Landlord Is Refinancing Or Selling Property Refinance/Sale of Property –Lender or Buyer may require Tenant Estoppel Letter –Lender may require confirmation that Lease be subordinate to mortgage –Lender may require Landlord to conditionally assign rents

18 18 Tenant Estoppel Certificate Most leases require Tenant to provide certified statement regarding lease within 10 days of Landlord’s request –Both a Lender and a Buyer will want Tenant to verify information regarding the lease terms and Landlord’s/Seller’s compliance with lease obligations

19 19 Tenant Estoppel Certificate Tenant should: –Read Estoppel Certificate carefully –Complete blank sections –Cross-out or change as needed Estoppel Certificate is binding on Tenant and can prevent Tenant from raising issue later if not noted here

20 20 Subordination, Non- Disturbance And Attornment Lender may require that all leases be subordinate to lien of mortgage Lease may already provide that it is subordinate to all present and future mortgages or require that Tenant subordinate Lease upon demand

21 21 Subordination And Attornment Subordination –Lease is subordinate to Mortgage and may be terminated through foreclosure Attornment –If Lease is not terminated through foreclosure, tenant shall recognize new owner as landlord under the lease for remaining term

22 22 Non-Disturbance Lease may provide that Tenant’s subordination is subject to Lender’s agreement “not to disturb” Non-Disturbance agreement – So long as Tenant is not in default, Lender agrees not to terminate lease; lease continues in accordance with its terms

23 23 Assignment Of Rents Rents as Collateral for Loan –In addition to a mortgage, Landlord may have pledged rents as collateral for Loan –If Landlord defaults, Lender may serve notice on tenant to pay rents to Lender –Assignment of Leases should contain authorization to Tenant to pay rents to Lender without liability

24 24 Defaults Holding Over –At end of lease term, if Tenant doesn’t vacate and Landlord accepts, lease by law converts to a month-to-month tenancy –If Tenant doesn’t vacate after notice from Landlord, Tenant liable for double rent (unless Lease provides otherwise)

25 25 Defaults Landlord’s Lien –Landlord has a statutory lien on Tenant’s equipment and other personality for unpaid rent –Landlord’s lien has priority for up to amount equal to 6 months’ rent

26 26 Damages Duty to Mitigate –Commercial landlord must make reasonable efforts to mitigate damages after a tenant breaches lease –Reasonable efforts include listing with a broker and advertising space

27 27 Damages Measure of Damages –Even if a landlord acts unreasonably in failing to mitigate damages, landlord may still recover difference between lease rent rate and the fair market rental value at time of default in a declining market

28 28 Conclusion Lease is a contract –In the first instance, check your lease Consult with an attorney –There may be laws that override your lease The best time to consult with an attorney, however, is before you sign your lease

29 Tips On Workplace Investigations Presented By: Annmarie Simeone, Esq.

30 30 Employer’s Duties Employer has a duty to investigate all complaints of harassment and take prompt remedial action reasonably calculated to end that harassment

31 31 The Investigation Is Important For Several Reasons: Demonstrates company’s adherence to, and enforcement of, its anti-harassment policies Potentially minimizes legal liability When well done, it can prevent litigation If litigation cannot be avoided, the investigation may provide a defense to claims

32 32 Consideration #1 Who Should Investigate? To maximize the chance of an effective investigation, the designated individual should be: An objective fact-finder Trained and knowledgeable regarding harassment law Trained in investigative techniques Familiar with company policies, practices, and structure Outside the involved parties’ line of management. Credible to employees

33 33 Consideration #2 Confidentiality Employers cannot promise absolute confidentiality Nothing can be “off-the-record” or “in confidence only” Instead, pledge to limit discussion only to those individuals who must be contacted in order to investigate and resolve the situation

34 34 Consideration #3 No Retaliation Employer can and should make a promise of no retaliation Employees complaining of harassment are exercising a legal right; as with any other legal rights, employees should not be adversely affected by advising the employer of alleged harassment (even if it is later concluded that the allegation was unfounded)

35 35 Consideration #4 Protect Complainant Employer should take steps to insure complainant is not subjected to harassment during pendency of investigation Possible Options: 1.Placing one or more involved parties on PAID leave of absence 2.Transferring alleged harasser (not complainant, as this may later be seen as retaliation) 3.Modify reporting structure

36 36 Consideration #5 Who Should Receive Complaint? Supervisor or other individuals who are or should be identified in anti-harassment policy Human Resources Managers Anyone who could potentially receive a complaint should: 1.Know to bring complaint to the designated individual in company 2.Not conduct investigation him/herself or without the knowledge of upper management

37 37 Consideration #6 Planning The Investigation A.Preliminary Issues 1.Act promptly i.24 hour goal ii.Within a few days if time is needed to identify investigator 2.Use 2 investigators if possible i.Insure objectivity ii.Facilitates investigation 3.Create confidential file i.May still be discoverable ii.Segregate key documents iii.Segregate privileged information 4.Conduct interviews privately

38 38 Planning The Investigation (cont’d) B.Gather the Facts 1.Collect and review relevant documents i.Complaint ii.Notes of interviews iii.Harassment policies 2.Interview the victim 3.Interview alleged harasser 4.Interview witnesses

39 39 Planning The Investigation (cont’d) C.Evaluate the Facts and Make a Decision 1.View facts from reasonable person’s perspective 2.Distinguish between “unwelcome” and “voluntary” conduct 3.Draw up a thorough and even-handed report

40 40 Post-Investigation Steps A.Report results of the investigation to the complainant B.Take appropriate corrective action. Depending on severity of conduct, option include: 1.Written warning 2.Mandatory training 3.Suspensions 4.Termination

41 When To Call Your Lawyer: A Seminar for Business Owners & Executives 10 Minute Break

42 Protecting Your Intellectual Property Presented By: Andrea S. Glaser, Esq.

43 43 Intellectual Property - Overview “Intellectual Property” broadly refers to creations of the human mind Intellectual property rights give creators property rights over their creations Patents –Inventions – a product or process that provides a new way to do something or offers a new technical solution to a problem Trademark versus Copyright

44 44 Trademark Basics Trademark search Applying for a trademark – –Office Actions –Oppositions –Consent agreements

45 45 Trademark (cont’d) International registration Fees Common law rights

46 46 Copyright Basics Applying for a copyright – Fees

47 47 Enforcement Consequences of non-enforcement Demand letters – sending them and responding to them Lawsuit for trademark or copyright infringement

48 48 Infringement Trademark Infringement –Standard of proof –Damages Injunctions Monetary relief Treble damages Attorneys’ fees and costs Copyright Infringement –Standard of proof –Damages Actual damages and profits Statutory damages – up to $150,000 per act of infringement! Possible criminal charges Attorneys’ fees and costs

49 49 Other issues Domain names –Domain Name Dispute Resolution Cybersquatting Licensing

50 E-Discovery What Does It Mean To You? Presented By: Margaret Raymond-Flood, Esq.

51 51 Where Do You Find Electronically Stored Information (ESI)? Laptops/Desktops Servers Phone Systems (VoIP) Printers & Copiers PDA’s/Cell Phones CD’s/DVD’s USB Thumb Drives

52 52 What Other Devices Contain ESI?

53 53 What does it mean to you? Documentary and other evidence has been lost before, but the presence of electronically stored information (“ESI”) heightens the risks: –Greater volume of evidence to manage –Need to deal with inadvertent and planned destruction –New formats and storage locations

54 54 The Corporate Enterprise Network

55 55 Early Cases Zubulake v. UBS Warburg –Adverse inference instruction for failure to preserve electronic evidence contributes to $29.3 million initial jury award Coleman Holdings, Inc. v. Morgan Stanley Co. –Adverse inference instruction for failure to preserve and produce electronic evidence leads to $2.58 billion damage award (reversed) U.S. v. Philip Morris USA Inc. –$2.75 million sanction for spoliation of electronic documents

56 56 New Jersey State And Federal Court Rules Were Recently Amended To expressly include ESI stored in any medium To permit the requesting party to designate the form in which ESI is to be produced

57 57 What Does It Mean To You? Preservation obligation attaches once “triggers” surface: –Statutory – Sarbanes, HIPAA, SEC, IRS, NJ Public Utility Act, etc. –Notice of a lawsuit –Litigation that is “reasonably anticipated” Attorney and client must preserve ESI

58 58 What Does It Mean To You? Assess and understand company’s information management Meta data is potentially discoverable; sound recordings are also to be considered as potentially discoverable Attorney and client must work to identify: –Key custodians –Relevant ESI on the client’s system –Locations of data storage devices

59 59 What Does It Mean To You? Notify employees of obligations to preserve ESI Consider offices in other geographic locations Formulate a cost-effective strategy for reviewing and managing ESI Suspend automated document destruction policies, and place “hold” on key ESI

60 60 What Does It Mean To You? Issue appropriate litigation “holds” Litigation “holds” must be: –Communicated in writing –Issued by someone with authority –Tailored to identify purpose of the hold –Specific in detailing which data should be maintained and why –Periodically confirmed

61 61 What Can You Do To Prepare? Discuss ESI retention plan and protocol BE PROACTIVE! DON’T WAIT FOR A CRISIS! Discuss your data systems and preservation issues Consider hiring outside vendors to assist in facilitating production of or access to ESI Implement procedures to ensure compliance Discuss the “reasonable accessibility” of ESI Must make these efforts a “high priority” Assemble team of corporate representatives

62 62 Safe Harbor Court rules provide that generally no sanctions may be imposed if information that had been electronically stored was lost as the result of routine and good-faith operation of the electronic information system –“Routine” defined as “the ways in which such systems are generally designed, programmed, and implemented to meet the party’s technical and business needs” –“Good-faith” identified as steps taken to “comply with a court order in the case or party agreement requiring preservation of specific [ESI]”

63 63 What Does This Mean To You? Creates duty to help ensure that relevant data is not inadvertently destroyed Good-faith steps to preserve may require suspension of document destruction systems Offers limited “safe harbor” protection against sanctions Sanctions: Monetary, bar evidence, adverse inference, dismissal of claim/defenses

64 64 What Does This Mean To You? Inventory, categorize, and catalog data storage locations and document types Develop document destruction schedules based on business need Damage control: immediately notify attorney of improper destruction; DON’T WAIT TO BE ASKED! BE PROACTIVE!

65 65 Call Your Attorney To Develop “Best Practices” Define policies with unanimous employee adoption Categorize information, and file it according to the corporate retention policy Dispose of data when it reaches the end of its retention policy Avoid policies that do not align with reality

66 It Is What It Is: Tax For 2008 Presented By: Melinda Fellner Bramwit, Esq.

67 67 So What Is It? Current tax climate Views of new president Stock market Capital gains vs. ordinary income

68 68 It Is... A Planning Opportunity S Corporations Do you have built in gains? –Take advantage of “Taxable Income Limitation”

69 69 It Is... A Planning Opportunity S Corporations Do you have passive income issues? –Dividend –Election to distribute before AAA

70 70 It Is... A Planning Opportunity C Corporation –Closely held - pay out a dividend –Thinking of selling?

71 71 It Is... A Planning Opportunity Lower market = lower values Consider getting an appraisal for a family business –Gifting

72 72 It Is... A Benefit Through 2008 Through 2008 –Section 179 benefit –Section 168 “bonus depreciation”

73 73 It Is... A Tax Credit Or Deduction You May Not Know About Everyone likes a credit or a deduction –Comparison Domestic Production Activities Deduction Research and Development Credit

74 74 It Is... A Tax Credit Or Deduction You May Not Know About Business Incentives –Disabled Access Credit –Work Opportunity Credit –General Business Credit

75 Questions & Answers Thank you for coming!

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