1. Preparing Your Contracts So A Comma Doesn’t Cost Your Company Millions
31st Annual Corporate Counsel Conference
February 15 – 17, 2018  
Preparing Your Contracts So A Comma Doesn’t Cost Your Company Millions
Featured Panelists
Sharae Wright
Sam Woodhouse
Natasha Martin
Thomas E. Hanson, Jr.
Michelle N. Lipkowitz
Moderator

2. Agenda Introduction of Speakers and Topic [5 minutes]
Contract Drafting General Principles with Recent Case Sample [10 minutes]
The Oxford Comma Case- O’Connor v. Oakhurst Dairy, No
(1st Cir. March 13, 2017).
Best Drafting Practices and General Trends for Frequently Litigated Contracts & Provisions, with Recent Cases [40 minutes]
Arbitration
Settlement Agreements
Choice of Law Provisions
Indemnification Provisions
Liquidated Damages
Party Identification
Practical Tips from General Counsel Addressing Questions Such As: [15 minutes]
Does your company use standard form agreements? If so, for what kinds of issues?
How often do you update/review your standard agreements?
Relationship between inside and outside counsel in drafting contracts?
Recent trends & issues you are seeing?
Questions [10 minutes]

3. Thomas E. Hanson, Jr., Esquire
Partner in the Litigation Department of the Delaware office of Barnes & Thornburg LLP.
More than 20 years of experience counseling clients in business disputes involving fiduciary duties, corporate governance, breaches of contract (including purchase and sale agreements), limited liability company agreements, trade secret protection and restrictive covenants. He is an accomplished litigator who represents large and medium-sized companies in a wide range of business law matters.
Mr. Hanson frequently appears before the Delaware Court of Chancery, the Complex Commercial Litigation Division of the Delaware Superior Court and the U.S. District Court for the District of Delaware. He has appeared as lead trial counsel in a number of complex commercial litigation cases and recently secured a defense jury verdict in a breach of contract action involving a claim for $15 million in damages. He also has experience bringing and defending “books and records” actions seeking nonpublic company information under Section 220 of the Delaware General Corporation Law and Section of the Delaware Limited Liability Company Act.
Sits on the board of directors for the Delaware Community Foundation and the First State Community Loan Fund, and also serves on the Salvation Army Regional Advisory Board.
Member of the Delaware Diverse Law Partners Network, Delaware State Bar Association and American Bar Association. Mr. Hanson is also the 2014 recipient of the DuPont Legal Minority Counsel Network Torchbearer Award, the 2011 recipient of the Multicultural Judges & Lawyers Section Leadership Award and the 2009 recipient of the Wilmington Award for Community Service.
J.D. from the Boston College Law School (1996) and B.A. from the University of Pittsburgh (1993).
Admitted to practice in the states of Delaware and Pennsylvania, and before the U.S. District Courts for the District of Delaware, District of New Jersey and Eastern District of Pennsylvania.
Barnes & Thornburg LLP is the product of a 1982 merger between two well- established Indiana law firms, one in Indianapolis, the other in South Bend. The marriage of Indianapolis-based Barnes, Hickam, Pantzer & Boyd and South Bend-based Thornburg, McGill, Deahl, Harman, Carey & Murray formed one of the largest law firms in the Midwest and began the firm’s growth to its current national stature. The firm currently has law offices located in Atlanta, Chicago, Dallas, Delaware, Indiana, Los Angeles, Michigan, Minneapolis, Ohio, and Washington, D.C., with more than 600 attorneys and other legal professionals.

4. Natasha Martin, Esquire
Natasha Martin is Senior Corporate Counsel at Varian Medical Systems, Inc., a California-based company that has pioneered developments in the fields of radiotherapy, radiosurgery, X-ray tube technology, digital image detectors, cargo screening, and non-destructive testing. In this role, Natasha supports the organizations commercial transactions business unit by (a) leading, negotiating, documenting and closing commercial transactions, including but not limited to, master sales, support, service, distribution, marketing, software and technology licenses and subscriptions; (b) advise on the legal aspects of commercialization, marketing and sales of new and existing products, including hardware, software, SaaS, electronic medical information, analytics and cloud based platforms; (c) identifying risks, drafting provisions and advising internal clients on alternative ways to mitigate risk; (d) articulating and drafting alternative positions in regards to liability, indemnities, warranties, intellectual property, security and privacy issues in the context of commercial transactions and agreements.
Prior to joining Varian, Natasha was at Infor, Inc., (a business software developer with 16,000 employees and over 90,000 customers in more than 200 countries and territories) for 10 years, serving most recently as its Associate General Counsel. She provided legal counsel to its public-sector and healthcare verticals with emphasis on contract drafting.
Natasha lives in Atlanta, GA. She is a graduate of the City University of New York – John Jay College of Criminal Justice and Mitchell Hamline University School of Law.
Varian Medical Systems’ vision is a world without fear of cancer. To meet this challenge, we equip the world with new tools for fighting cancer. Since the 1950s we have been producing tools that harness the power of X-ray energy to benefit humankind. Our history is one of pioneering developments in the fields of radiotherapy, radiosurgery, X-ray tube technology, digital image detectors, cargo screening, and non-destructive testing. Today, we have a robust product portfolio and long-standing relationships with many of the world’s leading clinicians. As Varian continues to grow, our staff of approximately 6,500 emplloyees in 70 sales and support offices around the globe is developing innovative, cost-effective solutions that help make the world a healthier place.

5. Sam Woodhouse, Esquire
Managing Partner of Woodhouse LLC in Atlanta, Georgia.
Regularly represents Fortune 500 companies, middle market companies, governmental entities, and high net worth individuals when they have challenges in the areas of business litigation, commercial arbitrations, commercial recovery litigation, contract law, and when they are in need of local counsel assistance.
Sam is an experienced trial attorney, having tried jury trials and non-jury trials to verdict in federal and state courts.
He supplemented his actual courtroom experience with intensive classroom trial advocacy training at Temple Law School’s nationally recognized LL.M. in Trial Advocacy Program.
This culminated in Sam earning an LL.M. in Trial Advocacy from Temple University Beasley School of Law, where he graduated with Honors.
Prior to establishing Woodhouse LLC, Sam was a Shareholder and the Managing Partner of the Atlanta office of a full service global law firm with over 500 attorneys in 21 offices.
Woodhouse LLC is a client focused law firm located in downtown Atlanta. We bring a solutions based approach to the practice of law to deliver proactive, thoughtful and creative answers to the business challenges that our clients encounter. We consider ourselves business partners with law degrees as we represent our clients who are Fortune 500 companies, middle market companies, governmental entities, and high net worth individuals. Our clients call us when they have challenges in business litigation, commercial arbitrations, commercial recovery litigation, contract law, data protection and privacy law, and when they are in need of local counsel assistance. We address the needs and challenges of our clients locally, regionally, and nationally. We deliver outstanding results. We do this by listening to our clients, understanding their business, crafting solutions, and providing “thought leadership.” We place great emphasis on knowing the business of our clients. As such, our legal services are shrouded in an understanding of the pressures and risks that our clients have in managing their business to the bottom line. In representing our clients, we factor in what it takes for them to successfully run their business.

6. Sharae Wright, Esquire
Corporate Counsel supporting the U.S. Customer and Commercial Leadership Team at The Coca-Cola Company.
Ms. Wright’s primary responsibilities include drafting and negotiating complex commercial agreements between The Coca-Cola Company and its largest national food service customers, as well as sponsorship agreements between The Coca-Cola Company and certain colleges and universities.
Ms. Wright provides legal guidance regarding marketing and promotional campaigns and serves as an Ethics Officer for a number of client groups.
Ms. Wright began her career in the Coca-Cola system in 2009 as a Senior Manager in Human Resources and later served as Labor & Employment Counsel for The Coca-Cola Company for three years.
Prior to joining The Coca-Cola Company, Ms. Wright practiced Labor & Employment Law at one of the largest employment law boutiques in the country.
Ms. Wright is a 2017 Fellow of the Leadership Council on Legal Diversity.
The Coca-Cola Company (NYSE: KO) is the world’s largest beverage company, offering over 500 brands to people in more than 20 countries. Of our 21 billion-dollar brands, 19 are available in lower- or no-sugar options to help people moderate their consumption of added sugar. In addition to our namesake Coca-Cola drinks, some of our leading brands around the world include: AdeS soy-based beverages, Ayataka green tea, Dasani waters, Del Valle juices and nectars, Fanta, Georgia coffee, Gold Peak teas and coffees, Honest Tea, Minute Maid juices, Powerade sports drinks, Simply juices, smartwater, Sprite, vitaminwater, and Zico coconut water. At Coca-Cola, we’re serious about making positive contributions to the world. That starts with reducing sugar in our drinks and continuing to introduce new ones with added benefits. If also means continuously working to reduce our environmental impact, creating rewarding careers for our associates and bringing economic opportunity wherever we operate. Together with our bottling partners, we employ more than 700,000 people around the world.

7. Michelle N. Lipkowitz, Esquire
Partner and Vice-chair of firm’s White Collar and Government Litigation Practice; focuses on commercial real estate and construction disputes, white collar investigations, and criminal defense.
Baltimore Office Vice Managing Partner and Firmwide Diversity & Inclusion Partner.
Fellow, ABA Forum on the Construction Industry and appointee to Sparrow’s Point Partnership.
Extensive experience dealing with highly sensitive matters and crisis management, including the press; extensive experience before various administrative bodies and courts across the country.
Served as the Governor-appointed Chair of the State of Maryland’s Transportation Professional Services Selection Board; Mayor-appointed Chair of the Baltimore City Zoning Board; and as a County Executive-appointed Member of the Baltimore County Planning Board, as well as on the boards of Maryland Volunteer Lawyers Service, the Baltimore Urban Debate League, Park Heights Renaissance, and Girls Empowerment Mission.
Named one of the “Most Influential Black Lawyers” by Savoy Magazine in 2015; selected for inclusion in Maryland Super Lawyers; named a “Leader in the Law” by The Maryland Daily Record (2014); recognized on The Maryland Daily Record’s Top 100 Women list, The Maryland Daily Record’s Leading Women list, and The Maryland Daily Record’s VIP List for Professionals under 40; recognized with the National Bar Association and IMPACT’s prestigious award for the 2013 Nation’s Best Advocates: 40 Lawyers Under 40; and in April 2014, recognized as one of The Girl Scouts of Central Maryland’s Distinguished Women.
BA from Harvard University; JD from Georgetown University Law Center.
Saul Ewing Arnstein & Lehr LLP is a full-service law firm that offers clients the national reach and sophisticated experience of a large firm and the local connections and value of a boutique firm. This
combination of reach and local autonomy supports our clients with the clout of a mega-firm and the service hallmarks of a boutique. With one firm, our clients get a macro view of the law with a micro focus on their unique legal needs. With 17 offices in Delaware, the District of Columbia, Florida, Illinois, Maryland, Massachusetts, New Jersey, New York and Pennsylvania, Saul Ewing Arnstein & Lehr serves businesses throughout the United States and internationally. We represent recognizable names in corporate America, exciting start-ups and an array of closely held and privately held companies, as well as nonprofits, governmental and educational entities.

8. Introduction - Topic
In a 2016 survey, nationwide corporate counsel identified contract litigation as the “highest litigation driver” and as the most concerning type of litigation because of its volume and value Litigation Trends Annual Survey: Perspectives from Corporate Counsel, NORTON ROSE FULBRIGHT (September 2016) 1.
These concerns are best exemplified in the recent “ten-million-dollar comma” decision in O’Connor v. Oakhurst Dairy F.3d 69 (1st Cir. 2017).
In sum, last year, the First Circuit held that the lack of an oxford comma meant that a Maine dairy company had to pay millions in overtime to its employees.  This case drew a lot of attention in the mainstream media about the importance of drafting clear legal documents. 
Throughout our session, we are going to hear from seasoned litigators on best practices and lessons learned from recent cases to help you prepare contracts and win litigation in any resulting disputes. Tips and best practices from in-house counsel on the frontlines will also be shared.
1 / litigation-trends-annual-survey pdf.

9. So, how much is a comma worth?
For Oakhurst Dairy delivery drivers:
$10,000,000
Ten Million Dollars
The Oxford Comma Case- O’Connor v. Oakhurst Dairy, No (1st Cir. March 13, 2017)

10. The $10,000,000 Comma
Dispute surrounding provision of Maine overtime law and contract provision.
The exemption provision states that Maine’s overtime law does not apply to employees involved in “the canning, processing, preserving, freezing, drying, marketing, storing, packing for shipment or distribution of…” certain products. Id. at 71. (emphasis added).
The plaintiff delivery drivers, who were undisputedly involved in “distribution,” claimed that the exclusion did not apply to them because the law excluded only those who participate in the single activity of packing, whether for shipment or distribution. Id.
Defendant Oakhurst Dairy disagreed and contended that the exclusion applied to two distinct activities, “packing for shipment” and “distribution,” a reading which would exempt the delivery drivers from overtime pay. Id.
The First Circuit found the statute ambiguous, following an exhaustive application of linguistic canons, legislative intent, and default rules of construction.
Under Maine law, the ambiguous provision was interpreted in favor of the beneficiary drivers. Id. at 80.
In this case, the absence of a serial comma, a small drafting mistake, exposed Oakhurst Dairy to $10,000,000 in overtime pay.

11. The $10,000,000 Comma (cont’d)
This case exemplifies the importance of understanding drafting trends to avoid unintended, costly, and adverse effects on the drafter.
How to avoid this? Focus on:
General Drafting Tips
Best Drafting Practices and Modern Trends in Contract Litigation

12. Contract Drafting – General Principles
Draft clearly.
Clarity is key – understand your client’s objectives
Express meaning clearly – do not use phrases that lend to multiple interpretations
Draft simply
Use short sentences
Omit unnecessary words
Draft consistently
Same words for same meaning
Identify inconsistent phrases and correct

13. Best Drafting Practices for Frequently Litigated Contracts & Provisions
Now trending…
Arbitration Clauses
Settlement Agreements
Choice of Law Provisions
Indemnification
Liquidated Damages
Party Identification

14. Arbitration Clauses: modern drafting challenges and the FAA
Ragab v. Howard
Kindred Nursing Centers LP v. Clark
Hobbs v. Tamko Building Products
Kai Peng v. Uber Technologies, Inc.
Norcia v. Samsung Telecommunications America, LLC
Snap Parking LLC v. Moris Auto Enter., LLC

15. Ragab v. Howard: conflicting documents
Two (2) parties formed six (6) separate business agreements, containing conflicting arbitration provisions.
A dispute arose, with one party moving to compel arbitration pursuant to the agreement.
Inconsistencies across the arbitration provisions indicated there was no meeting of the minds.
The court denied the motion to compel arbitration.

16. Kindred Nursing Centers LP v. Clark: arbitrating contract formation
Two individuals held power of attorney for their relatives and entered into an arbitration agreement. When they sued for wrongful death, the nursing center moved to dismiss the cases and compel arbitration. The individuals responded that they did not have power to enter into an arbitration agreement, so the contract was not formed.
The United States Supreme Court held: the FAA applies to disputes over contract validity and disputes over the initial formation of the contract.

17. Hobbs v. Tamko Building Products: acceptance of agreement
Plaintiffs purchased shingles which were sold individually and not in the original wrapper, which contained the arbitration clause. When a dispute arose, defendants moved to compel arbitration.
Purchasing the product alone did not constitute acceptance of the arbitration agreement because the customer did not receive adequate notice.

18. Hot topic: acceptance of class action arbitration waivers
Kai Peng v. Uber Technologies, Inc.
E.D.N.Y held: Class action arbitration waivers are enforceable when accepted through a virtual phone application.
Norcia v. Samsung Telecommunications America, LLC.
9th Circuit held: Class action arbitration waivers are not enforceable when contained in a brocure that accompanies the product.

19. Snap Parking LLC v. Moris Auto Enter., LLC: conflicting clauses
A dispute arose over two conflicting clauses:
(1) an agreement to arbitrate all claims, and a waiver of any attempt to pursue any claims as a class action arbitration; and
(2) a provision providing that “the intention and agreement of the parties” was “not to arbitrate class actions.”
The combination of an arbitration agreement and a class action arbitration waiver is not sufficiently clear enough to constitute a bar against class action suits altogether.

20. Arbitration Clauses: Takeaways
Maintain consistency if multiple agreements with one client contain arbitration provisions.
Communicate the arbitration provision with the consumer noticeably and clearly.
Class arbitration waivers are permissible, but must be explicit and communicated.

21. Settlement Agreements: Case Overview
Need to be very careful and clear if not releasing all of the claims
Settlement Agreements: Case Overview
Arrowood Indemnity Company v. Lubrizol Corp.
In re: Motors Liquidation Company
Ward v. Lassiter
Limelight Technologies v. Akamai

22. Arrowood Indemnity Company v. Lubrizol Corp addresses "Arising Out Of”
What could the drafters have done differently?
Arrowood Indemnity Company v. Lubrizol Corp addresses "Arising Out Of”
Lubrizol entered into two settlement agreements with the insurance companies, releasing “all claims…arising out of” a list of subject sites attached to the agreement. A dispute arose around a site that was not on the attached list, but was affected by a listed site.
The language of the settlement agreement released the insurers from any claims “arising out of” the listed site, including claims that were present at a non-listed site but related to a listed site.

23. In re: Motors Liquidation Company: assignment clauses in settlement agreements
Doris Phillips sued General Motors in 2005 when her husband and four children were killed in a car accident. Phillips assigned her unsecured claim from the parties’ $2.7 million settlement “without limitation” and released all other causes of action.
Phillips attempted to sue GM for Fraud post-settlement, when she allegedly discovered that GM withheld documents proving a recall of the car her husband was driving at the time.
Post-settlement assignments with broad language release all claims, including fraud claims, against the defendant.

24. Ward v. Lassiter: virtual acceptance of settlement terms
Plaintiff and defense counsel discussed terms of the settlement agreement via . The parties agreed on a settlement amount, but did not agree on indemnification or release language. When defense counsel moved to enforce the settlement amount, plaintiff’s counsel refused.
Failure to agree on terms of indemnification and release was not a failure to agree to a material settlement term, and the exchange constituted a binding agreement for the settlement amount.

25. Limelight Technologies v
Limelight Technologies v. Akamai: communicating breach of settlement agreement
Limelight Networks attempted to terminate payment on the remaining $40 million of a settlement agreement. The settlement agreement required notice of breach or termination go “directly to Akamai’s [general counsel or legal officer], regardless of means.” No or mailing address was specified. Limelight sent notice of the breach via to counsel for Akamai in an outside matter.
The communication did not meet the notice requirement, and Limelight must pay the remaining $40 million.

26. Settlement Agreements: Avoiding Litigation
Carefully draft any lists attached to release language.
Confirm whether assignment language releases all claims or select claims.
Do not accept incomplete settlement agreements over .
Specify a clear procedure for settlement agreement communications.

27. Choice of Law Provisions: Case Overview
Rincon EV Realty LLC v. CP III Rincon Towers, Inc.
Rimel v. Uber Technologies, Inc.

28. Rincon EV Realty LLC v. CP III Rincon Towers, Inc
Rincon EV Realty LLC v. CP III Rincon Towers, Inc.: Choice of Law + Venue
Contract between Plaintiffs and Defendants included a New York Choice of Law provision, which includes a Jury Trial Waiver. Plaintiffs sued defendants in California, demanding a jury trial.
NY Choice of Law Provision: Very popular among vendors.
The forum state has a greater interest in determining enforceability of the jury trial waiver because the right to a jury trial in a state is fundamental. The Choice of Law was disregarded.

29. Rincon EV Realty LLC v. CP III Rincon Towers, Inc
Rincon EV Realty LLC v. CP III Rincon Towers, Inc.: Choice of Law + Venue
Governing Law. THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK, THE LOAN WAS MADE BY LENDER AND ACCEPTED BY BORROWER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THE LOAN DELIVERED PURSUANT HERETO WERE DISBURSED FROM THE STATE OF NEW YORK, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT, THE NOTE AND THE OTHER LOAN DOCUMENTS AND THE OBLIGATIONS ARISING HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE (WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS) AND ANY APPLICABLE LAW OF THE UNITED STATES OF AMERICA․

30. Rincon EV Realty LLC v. CP III Rincon Towers, Inc
Rincon EV Realty LLC v. CP III Rincon Towers, Inc.: Choice of Law + Venue
The choice-of-law provisions also specify that plaintiffs waive any claim that California law, or the law of any state other than New York, governs the parties' agreements:
TO THE FULLEST EXTENT PERMITTED BY LAW, BORROWER HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY OTHER JURISDICTION GOVERNS THIS AGREEMENT, THE NOTE AND THE OTHER LOAN DOCUMENTS, AND THIS AGREEMENT, THE NOTE AND THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK PURSUANT TO SECTION OF THE NEW YORK GENERAL OBLIGATIONS LAW.

31. Rimel v. Uber Technologies, Inc.
An uber driver sued uber claiming they exploited him as an employee, and Uber move to compel arbitration. The driver contested the application of Florida as governing law, contending that the California choice of law provision in the Uber Services agreement governed. Uber disputed that this Choice of Law provision applied to the arbitration agreement.
The choice of law provision contained in the overall services agreement did not apply to the arbitration provision. If counsel wishes for a choice of law provision to apply to the arbitration provision, the language must state it.

32. Rimel v. Uber Technologies, Inc.
The services agreement says it is governed by California law, but it also contains an arbitration provision that says “the choice of law provisions contained in this Section 15.1 do not apply to the arbitration clause contained in Section 15.3, such arbitration clause being governed by the Federal Arbitration Act.”
Arbitration clause is severable from the other provisions of the agreement and thus has no choice of law.

33. Choice of Law Provisions: Avoiding Litigation
Include a choice of law provision and venue provision to ensure any benefits of the choice of law provision.
State which agreements the choice of law provision applies to.

34. Indemnification: Case Overview
Rung v. Pittsburgh Associates, LP

35. Rung v. Pittsburgh Associates, LP
A patron slipped and fell in the restroom at a Pittsburgh Pirates game, and executed a settlement with plaintiff and the Pirates. A dispute over the indemnification followed, based off of the following language indemnifying the Pirates from:
“All claims, losses, and liabilities arising out of ‘the professional negligence, gross negligence, recklessness, willful misconduct, or fraud/criminal acts of CBRE.’”
Under the provision as written, a simple allegation of recklessness in the plaintiff’s complaint was not enough to trigger the reckless behavior included in the indemnification clause.

36. Indemnification: Avoiding Litigation
Specify conditions that trigger indemnification claims.

37. Liquidated Damages: Case Overview
136 Field Point Circle Holding Co. v. Invar Int’l Holding, Inc.
CRS Proppants LLC v. Preferred Resin Holding Co, LLC.

38. 136 Field Point Circle Holding Co. v. Invar Int’l Holding, Inc.
A guaranty agreement included a clause that it “absolutely, unconditionally, and irrevocably” guaranteed certain obligations of the primary obligors set forth in documents.
The guarantor brought action to enforce a $1,000,000 penalty the obligor incurred as liquidated damages. Traditionally, New York courts deny this on policy grounds.
The court bound the guarantor to the obligations of the lease regardless of the enforceability of the lease, even after emphasizing that “broad, sweeping and unequivocal language” in these guarantees generally “forecloses any challenge to the enforceability and validity of the documents.”

39. CRS Proppants LLC v. Preferred Resin Holding Co, LLC.
Defendant sued plaintiff, claiming that plaintiff triggered the liquidated damages provision. Plaintiff countered that the liquidated damages provision was an unenforceable penalty because it contained a stipulated sum.
The services agreement between CRS and preferred was appropriately drafted as a liquidated damages agreement for a stipulated sum because it was drafted with intent to “fix an amount compensable in contemplation of the potential loss that might flow from a breach.”

40. Liquidated Damages: Avoiding Litigation
Broadly draft liquidated damages provisions so they are applied regardless of contract enforceability.
Ensure liquidated damages provisions are not “irrespective of the gravity of the breach.”

41. Party Identification: Case Overview
QVC v. OurHouseWorks
Holmes Motors, Inc. v. BP Exploration & Production

42. QVC v. OurHouseWorks
OurHouse signed a “manufacturer product demonstration disclosure form” which was signed on behalf of “EnvirOx/OurHouse, LLC. QVC rejected and returned to OurHouse certain merchandise, per the terms of the purchase orders.
QVC was entitled to a return, but OurHouse ceased business operations and refused to pay. QVC brought suit, attempting to pierce the corporate veil and hold EnvirOx liable for the damages.
Because the two parties had “such unity and ownership” as was required, the court pierced the veil,– focusing on financial records, commingling of funds, and the name signed on the contractual document with QVC of EnvirOx/OurHouse.

43. Holmes Motors, Inc. v. BP Exploration & Production
A car dealership (Holmes) filed a claim with the Court Supervised Settlement Program for the Deepwater Horizon spill. Holmes unsuccessfully claimed that it qualified as a “startup business,” arguing that the plain meaning of a “business” is a line of business, and not a business entity.
The court did not classify Holmes as a start up business, emphasizing that the meaning of “startup business” in a contract will traditionally suggest a claimant that “undergo[es] a drastic and fundamental change to enter a new line of business.”

44. Party Identification: Avoiding Litigation
Clearly identify parties to a contract.
Ensure the party identification is correct.

45. Practical Tips from General Counsel
Does your company use standard form agreements?
If so, what kinds of uses?
How often do you update/review your standard agreements?
Relationship between inside and outside counsel in drafting contracts?
Recent trends and issues you are seeing?

46. Questions ? Thoughts?