I keep explaining that I do,actually cannot, practice patent law. I am convinced that a great weakness for many businesses is not knowing enough about patent law. With that in mind, you should check out Patently-O.
If you need a referral to patent lawyer in the area around Anderson, please give me a call.
Not a problem I was aware of until I read the Enjoy Every Sandwichblog'sProving We're Not Terrorists - Day 6. (I assume that is a Warren Zevon reference in the blog's name and if so, it is a great one especially if you read the rest of the blog.)
We only wanted to open a simple business checking account. Stop in at the bank, transfer some funds from one account to this new account. Sign a couple papers. There 'ya go.
There we went, right out the front door, told that we have to prove that we're really a business and not terrorists trying to launder money around the world.
"How do we prove we're really a business? Well the bank wasn't very good at understanding that part of it. This morning we're going to stop in again and we're bringing everything: state sales tax license; a letter from the borough and the local tax collector; business cards and stationary; an invitation to visit our Web site; driver's license; social security card; and my Goofy Goober Ice Cream Club membership card just to make sure."
That I never counsel clients to start a business except as a corporation or a limited liability company may explain why I have never heard of this problem. If anyone else has similar experiences, please use the comment function below to let us know about them.
As I wrote above, every business owner needs to protect themselves from liability. A husband and wife business needs protection even more than most.
Remember that if you are starting a business in Indiana, you should give me a call.
Thanks to Rush on Business for leading me to The Manpower Blawg. While I disagree that The Manpower Blawg uniquely provides free legal information (I think I and all other legal bloggers are doing this), I fully endorse this statement: "This blog -- or blawg -- is designed to provide you with up-to-the-minute employment law information without putting you to sleep...." The blog does anything but bore and worth keeping an eye on - especially for plaintiff attorneys.
DREAMCOAT Software tech blog by Milan Vrekic published Ethics of Outsourcing which has some interesting but maybe not fully developed points on outsourcing and trade secrets:
"A clear definition and practice of the ethical rules and privacy policies of the organization like non-disclosure of trade secrets, secrecy and non-disclosure contracts with staff, third party service providers and visitors is a prerequisite. This will reassure the outsourcer that it is safe to do business with a partner who is miles away. Employee Credibility
Information security will largely depend on the people who handle the information. Organizations that implement tough employee credibility measures have a direct implication on its outsourcing ethics."
When seeing the term outsourcing, I assume that many will think of jobs being sent to India or other points overseas. Outsourcing can be around the corner or down the street. This office does not see much of outsourcing but that may change as more companies contract out different areas of work. Your company may be doing this already. If so, the business must evaluate how it is protecting its trade secrets when using subcontractors. (If you are coming late to this blog and my discussions of trade secrets, just click on the link below for trade secrets for all of my articles on the subject).
New York Business Divorce has been publishing a series on a New York business dissolution case under the title Anatomy of a Dissolution Slugfest. I think all are worth reading for anyone setting up a business or wanting to get out of an existing business. I wish I could say that all problems would be solved with proper planning but not all problems can be contemplated and planned for - just that things go better when an attempt is made.
"Question: What do you get when you take a luxury automobile dealership consisting of multiple corporations and limited liability companies, stir in three business partners, add contradictory documents concerning one partner’s ownership interest, season with a federal indictment of that same partner for stock fraud following which the other two partners freeze him out of the business, top off with a pair of litigators and bring to a boil?"
...Part II (read it here) covered some additional issues raised in the court’s initial decision including the defendants’ argument that they acted reasonably by excluding Marciano from the business after his criminal indictment. Part III (read it here) highlighted portions of the court’s June 2007 decision in which it denied Marciano’s motion to compel payment to him of distributions pending the litigation and granted his motion for leave to amend his complaint. Part IV (read it here) addressed the court's September 2007 decision in which it denied defendants' motion for summary judgment contesting Marciano's share ownership and arguing that Marciano's March 2007 guilty plea to unrelated stock fraud charges justified their excluding him from the business operations.
This Part V examines the court's final decision dated December 7, 2007, concerning a new twist in the proceedings triggered by the defendants' assignment of a valuable dealership lease held by a company co-owned by Marciano to another company owned solely by the defendants. A postscript follows for readers interested in the outcome of the case and some reflections on its greater meaning.
Rush Nigut published a very good post, .300 Won't Get You Into the Employment Law Hall of Fame, for employers wanting to avoid employment law suits. I suggest going over to Rush on Business and read the parts of the post I do not quote below. It also has some good points for those employees thinking of suing their employers.
The Indiana Lawyer Daily reported on this case earlier in the month under the headline Circuit Court finds no age discrimination. The article does a a good job of explaining why there was no case under the federal ADEA.
"In Laverne Tubergen v. St. Vincent Hospital and Health Care Center, Inc., No. 06-4304, Dr. Tubergen filed a discrimination complaint against St. Vincent under the Age Discrimination in Employment Act of 1967. In an effort to streamline its operations and become more efficient, the hospital hired James Houser as its chief operating officer. Before restructuring, St. Vincent had a 'service line' for each of the nine medical specialties it provided, and each service line was run by a medical director, who was a physician, and an executive director that was a nurse."
*** The 7th Circuit affirmed the District Court's decision, finding Tubergen provided insufficient evidence to back his age discrimination claim. Tubergen argued Houser's alleged comments about "the old guard" could give rise to a reasonable inference of age discrimination. The record showed the co-worker who overheard the comment noted it was in reference to the children's hospital, where Tubergen did not work. Also, it is possible to not take the reference of "the old guard" to literally mean "old" people, and it's more likely in line with getting rid of the previous structure, not individuals, as Houser explained he meant it in his desposition, wrote Judge Joel Flaum.
The record showed Tubergen was considered for other positions; however, he was not a qualified candidate. Tubergen also made no effort to apply for other jobs within the hospital, wrote Judge Flaum.
In addition, those who remained with the hospital after the restructuring varied in age, and the ages of the more than 300 people whose positions were eliminated also varied.
"Designers will create ingenious objects with hidden multi-functionality, devices that, for one reason or another, cloak what they can really do. We’ll also see designers pressed to find ways to better protect trade secrets and the valued expertise of the genius creator — in other words, designers will be designing objects that actually enhance their own professional lives and buttress their privileged position in society."
For the lawyers reading this especially: if we are going to talk about trade secrets, we need to keep the trade in mind as well as the law.
For business people: educate the lawyer handling your trade secrets case about your trade.
With baseball season now starting, I think The New York Times' Oedipus Bronx might have even a bit more relevance.
"For the Yankees, the ongoing succession is a lot more complicated than it was for either the Mets or the Knicks. The team is now in the hands of not one but two designated heirs, and one of the Steinbrenner sisters, Jennifer, will have a voice in the team’s operations, too, as will Felix Lopez, the second husband of the other sister, Jessica. “Like almost any family business with a patriarch and children, the long-term future of the Yankees will depend on the need to avoid sibling rivalries and other types of problems,” one of the team’s limited partners told me. “The question is going to be how they function as a family.”"
"The clinic sued Dr. Michael McKinney, a physician and onetime board member, alleging that while he was a director, McKinney secretly worked to establish a new medical practice in Jessamine County that would compete with Lexington Clinic."
***
Among other things, the suit alleges McKinney entered into a contract to work for a competing medical facility; worked to have other former clinic physicians join him in practicing medicine in competition with the clinic; and recruited or encouraged other clinic employees to leave the clinic and join a competing facility.
***
The suit also says that as a director, McKinney received or had access to the clinic's confidential, proprietary business and financial information and materials, which he has not returned.
The lawsuit alleges that McKinney breached his fiduciary duties as Lexington Clinic director by facilitating the establishment of a competing operation, and is in a position to "misappropriate" clinic trade secrets to the detriment of the clinic.
I have to say I find the breach of fiduciary duties more interesting than the non-compete agreement. This reports does good duty serving as a reminder that the facts determine the type of claim and that facts are shifty things.
"As currently proposed, the ADA Restoration Act would redefine 'disability' to include 'a physical or mental impairment' or 'a record of a physical or mental impairment' or 'being regarded as having a physical or mental impairment'. The bill effectively overrules several U.S. Supreme Court decisions that narrowed the scope of the ADA's protections. Individuals no longer would need to prove that impairments 'substantially limit' one or more 'major life activities.' Courts and employers also would be prohibited from considering the effects of mitigating measures (such as medication or devices) when determining whether individuals are disabled. The bill appears to shift the burden of proving whether an individual is 'qualified' to perform a job from employee plaintiffs to employers."
"For years payday lenders have been the bad guy in the predatory lending debate while their close cousin, car title lenders, have cruised along unnoticed - and perhaps more disturbing for some - unregulated in several states. Many efforts to regulate the industry have failed as the lenders pour hundreds of thousands of dollars into legislative campaigns."
***
Here's how the loans usually work: A borrower gives the title to his vehicle and a copy of its keys to a lender in exchange for a loan up to about half of the car's wholesale value. The borrower agrees to repay the loan plus triple-digit annual interest and other fees and often must pay back the loan in a month or two. If the borrower falls behind, he could lose his car.
There is no nationwide data on the industry. Because the lenders are unregulated in several states, officials have no way of keeping track of the loans.
If I am following the article, Plastics firms at odds, from The Evansville Courier, this employee was hired by the new company before actually departing from the plaintiff company.
In the complaint, Rexam attorneys say the company previously employed Whitehead as director of sales, but he accepted a job as vice president of business development for Berry Plastics' Rigid Closed Top Division on Dec. 11.
Rexam claims Whitehead did not disclose to them he had taken a job with Berry until Jan. 3, and alleges his position at Berry amounts to a breach of contract, breach of fiduciary duty and "actual, threatened and inevitable misappropriation and conversion of Rexam's confidential information and trade secrets."
"Before accepting his job at Berry, while still employed at Rexam and without Rexam's knowledge, Whitehead solicited several Rexam engineering, manufacturing and sales employees, including senior managers, for employment at Berry," the complaint states.
What could be an important decision on the federal Age Discrimination in Employment Act (ADEA) from the United States Supreme Court. The following report is from workforce.com.
"In a 7-2 opinion handed down on Wednesday, February 27, the court acknowledged that the suit did not follow the procedures laid out in the Age Discrimination in Employment Act (ADEA), which says a civil procedure can’t begin until 60 days after a charge has been filed with the Equal Employment Opportunity Commission."
**** Nonetheless, the Supreme Court majority was reluctant to punish employees for an EEOC mistake.
“[U]ndoubted deficiencies in the agency’s administration of the statute and its regulatory scheme are not enough … to deprive the agency of all judicial deference,” wrote Justice Anthony Kennedy for the majority. “Some degree of inconsistent treatment is unavoidable when the agency processes over 175,000 inquires a year.”
The majority also endorsed the EEOC’s stance that a charge occurs whenever a complainant asks the agency to act against an employer.
***
Kennedy urged the EEOC to revise its forms and procedures to provide more clarity. In the oral argument, the agency said that improvements already have been made.
“The ball is really in the EEOC’s court to do a better job of processing charges,” said Will Deveney, a partner at Elarbee Thompson in Atlanta. “I don’t see the court getting back into this particular issue again for some time.
For those following this blog, I am playing catch up after a protracted illness. Which is why I am combining what might otherwise be two separate posts. In the past week, developments occurred in the General Assembly and with the Memory Gardens receivership.
The Indianapolis Star reports on new legislation concerning cemetery trusts. In Bill seeks to protect cemetery trusts, The Star has the following sidebar:
Cemetery bill
Recent fraud cases spurred state legislators to toughen restrictions on cemetery trust funds meant to cover grounds maintenance and prepaid contracts for burial services. House Bill 1026, which has passed both chambers of the General Assembly, now heads to Gov. Mitch Daniels' desk.
Some of its provisions:
Restrictions: Classifies funeral, cemetery and burial trusts as charitable trusts; tightens standards for their use; and establishes fiduciary responsibilities for institutions holding them. Gives the state attorney general tools to go after abuses of a trust in court, including restraining orders, restitution and appointment of a receiver.
Abuse: Makes knowingly or intentionally paying out money for an improper purpose a Class C felony, giving prosecutors and regulators the ability to go after owners and bankers. Establishes fines for other violations.
Verification: A trustee must verify a person's death before releasing money held in a burial or funeral trust for a prepaid contract and must confirm the services were provided. Trustees of funds created after June 30 cannot be affiliated with the cemetery owner.
Restoration: Compels owners who abuse trust funds to restore the lost principal.
Disclosure: Requires owners to disclose in writing that a vault is not airtight or watertight.
Study: Charges the Probate Code Study Commission with reviewing cemetery and funeral trust laws to determine whether additional changes should be made in Indiana. Its report is due by November.
The reporting on the Memory Garden receivership came from WISH TV 8. The report, Testimony shows company in difficult position, millions lost has some interesting things to say about the running and powers of a receivership (if even only seen obliquely and partially).
"JOHNSON COUNTY, Ind. (Johnson County Daily Journal) - A cemetery and funeral home managing company was struggling to make ends meet and could be short as much as $24.5 million in trust fund money."
Less than two months ago, Memory Gardens Management Corp. didn't have enough money coming in to pay all its bills, said Lynn Gray, who was appointed to oversee the company's finances and management.
Gray cut about $1.5 million out of the yearly budget, including projects the business could do without and the salary, benefits and vehicles of the company's owner and a former manager of a funeral home and cemetery the company operates on State Road 135.
Now, the company, which has a staff of more than 180, can pay its weekly bills, she said.
But concern remains over the future, such as what Gray believes is a shortage in the company's trust funds and larger bills, such as for caskets or other services and merchandise, which eventually need to be paid.
Gray testified in a hearing Monday about her work as court-appointed receiver of Memory Gardens, which includes Forest Lawn Memory Gardens and Funeral Home.
***
The hearing that began Monday will determine whether Gray should stay in her role or whether those responsibilities should be turned back over to the company.
She testified that turning the company back over to Nelms could harm customer confidence in the business, which includes cemeteries and funeral homes in Indiana, Michigan and Ohio.
There also are other issues that need to be investigated, Gray said.
One of the main issues is whether the trust funds have the amount of money required by law.
Not a lot of good news and the linked article's title pretty much says it all.
Bankruptcy Makes Gift Cards Worthless: "As more retailers file for bankruptcy or go out of business, more than $75 million in gift cards are at risk of becoming worthless pieces of plastic this year."
Then take a look at The Boston Globe's 'Co-preneurs' brave work-life challenges. I seriously suggest talking to an attorney who knows about prenuptial (or post-nuptial) agreements and setting up businesses.
If you and your significant other are considering setting up a business in Indiana, please give me call.
I ran across an article from the Irish Independent that is a bit different from the usual trade secrets case but also has so much in common with the most mundane trade secrets case. Here are the high points from Top women in court battle on 'trade secrets':
"It is alleged that Ms Kershaw -- who was still working for Harmonia at the time -- gave the information to Max Media Communications, a company owned by another of Ms Casey's former employees, Garret Whelan."
***
Harmonia Ltd hired private computer forensics investigators and claimed that Ms Kershaw gave secret inside information to aid a rival firm to secure the tender for the contract to publish Cara magazine
A reminder that trade secrets affect all kinds of business comes from - OregonLive.com's Secrets of the dough:
In a legal battle seldom seen in civil court, Bernardo Mendoza is suing two other bakers for the sake of sweet bread.
Not just any sweet bread, but sugary Mexican concoctions such as "seashells," "rocks," and "kisses" the baker says took him nearly two-thirds of his life to perfect, only to be stolen overnight by the competition.
Mendoza's Tienda y Panaderia Santa Cruz in North Portland's St. Johns neighborhood is suing former employees Benjamin Gomez Mendoza and Luis Morales alleging "misappropriation of trade secrets" -- stealing recipes protected by contract and in great demand by Latinos across Portland.
"After a few workers resigned, a lawyer drafted a trade-secrets agreement for Santa Cruz. In it, employees agree they won't share recipes or techniques for a two-year period after termination, won't work at a bakery within a 30-mile radius of the St. Johns store or return to solicit Mendoza's workers to work elsewhere."
The Mendoza brothers say they began to see Bernardo's bread appear at El Grande and their own sweet bread sales dipped. So they hired Chernoff, Vilhauer, McClung & Stenzel, a Portland intellectual-law firm known for representing such high-stakes corporations as Nike.
The lawsuit, filed Feb. 11 in Multnomah County Circuit Court, seeks $10,000 in damages, attorney fees and demands that the defendants stop using Santa Cruz's recipes.
Standing on a floor colored white with flour, the defendants insist they did not steal recipes and, because of their limited English, they had no idea what they agreed to by signing the trade secrets contract.
Employees need to remember that their privacy rights at work range from few to none. Take a look at workforce.com's Quick Takes -- March 11, 2008:
"Eavesdropping on Employees: Spurred by fears of litigation and diminishing productivity, U.S. employers are keeping close tabs on employees’ workplace activities. The American Management Association and the ePolicy Institute say nearly half of U.S employers have fired employees for misusing corporate e-mail or Internet access. About two-thirds use software to prevent employees from surfing the Web for porn and other questionable content—up 27 percent since 2001, when the two organizations launched their annual Electronic Monitoring & Surveillance Survey."
***
Aside from listening in and peering over employees’ shoulders virtually, many companies (45 percent) monitor their phone use as well. And 16 percent go so far as to record phone conversations. But according to the survey, nearly 85 percent of companies let employees know they are being surreptitiously observed.
Last post of the day, and another flu induced data dump. From The Washington Post comes Dot-Commitment:
"By the time he arrived at Virginia Tech in January 2004, Fahad Hassan still was not over his first business failure. He had poured his heart into a computer support business in his final year of high school, but after a promising few months the customers dried up and the expenses ballooned."
***
Regardless of a business person's age, getting a start-up off the ground is a risky proposition. Researchers at the University of Maryland recently examined the fate of venture capital-seeking Internet companies started at the height of the technology boom in the late 1990s. Only half existed five years later.
Yet young entrepreneurs like Hassan persist, and they've become an enduring dot-com archetype. In the Washington area, two of the best-known Web start-ups -- Freewebs and Clearspring -- are led by people in their mid-20s.
Since Hassan launched his company, he's had to work tirelessly to solicit venture capital money and to manage employees who are old enough to be his parents.
Hassan "reminded me of the early days of the Internet where it was digital natives: the people who grew up with technology who saw the future," said April Young, a prominent local technology banker who has tried to help Hassan build his company. "The challenge that he and other early entrepreneurs face is: How much control are they willing to give up both financially and intellectually?"
***
Not everyone was as easily won over by Hassan's vision. Hassan later visited John Burke, a partner at venture capital firm True Ventures, which has an office in Great Falls. Hassan was searching for money, and True Ventures had backed young entrepreneurs before.
"He only saw his product from a user standpoint. There was no business model," Burke said. "My skepticism revolved around: 'How is he going to make money around this? How is he going to get professors to sign up? How is he going to get universities to switch horses midstream?' "
***
On an evening last week, Hassan did what he most needs to do as a young chief executive: take advice from others.
He went to a Washington Capitals hockey game at Verizon Center as part of the MindShare program, which has been a local forum for established technology entrepreneurs to help start-ups. Before the game, he listened to AOL vice chairman emeritus Ted Leonsis give a talk on entrepreneurship.
Hassan sat a few rows up, one of 40 people all hoping to be in charge of the next great technology company. Most of them were 10 or more years his senior.
As mentioned elsewhere on this blog, I am recovering from the flu. I am horribly behind in my reading and even further behind in my posting. Please pardon the bare bones of the posts over the next week. I am trying to get out what appears important but not adding much in commentary - there is just not enough time right now.
Until now, plan participants could only sue employers over losses in their 401(k) plans through class-action suits. But in its opinion Wednesday, February 20, the Supreme Court said that under the Employee Retirement Income Security Act, individual employees can sue plan sponsors for losses on behalf of the plan.
“This should be a wakeup call to employers,” says Don Stone, president of Plan Sponsor Advisors, a Chicago-based 401(k) consultant. “They need to recognize that as fiduciaries, they have responsibilities and there is going to be a spotlight shined on them.”
Thanks to the flu, I am horribly behind in my reading. I actually did not know i had the flu until I caught myslef reading the same paragraph in an article four times and still not understanding what I was reading. So for a while, I am relying on The Indiana Daily Lawyer alerts.
"In Linda Keesling, Harold Lephart, et al. v. Frederick Beegle III, John Bucholtz, et al., No. 18S04-0704-CV-150, the high court accepted transfer to rule on whether liability under the Indiana RICO Act extends only to people who direct racketeering activity, the 'generals,' or whether it extends below the managerial or supervisory level to the 'foot soldiers.'"
****
The Supreme Court ruled that the Indiana RICO Act uses "significantly broader" language than the federal act, which states that it's unlawful for anyone employed by or associated with an enterprise to "conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt."
Under Indiana's act, a person can be charged if he or she "knowingly or intentionally conducts or otherwise participates in the activities of that enterprise through a pattern of racketeering activity."
As a result of this difference in language, the Supreme Court overturned summary judgment in favor of defendants Dennis Baugher; Baugher's company, Florida Underwriting; and William Jones with respect to the Indiana RICO Act, finding Indiana's act imposes liability on both persons at or below a racketeering enterprise's level of manager or supervisor.
The plaintiffs are Indiana residents who purchased pay telephones and entered into service agreements to install, service, and maintain the phones. The plaintiffs were passive investors in the program that targeted investors across the country, relying upon the promoters of the deal to select locations, install, and service phones, as well as obtain all regulatory certifications.
For anyone following this blog, you have my apologies. After the wife had had the flu for a week and I felt fine, I assumed she had something else. Wrong. It was nice enough to wait till I had had my birthday on the 27th. I have experienced the full range of symptoms since Thursday and I can say none were very fun. I made an attempt to read my e-mail yesterday but that was mind numbingly slow going. This morning, I feel drained but that is about all. Miserableness. That word describes the past four days. At one point, I thought about how all those people died in 1919 and I thought what a miserable way to die. Things will be slow here over the next week. Work has piled up, telephone calls need returned, and writing here must take less precedence. Please, bear with me for the next week.
I am Sam Hasler of Anderson, Indiana and I write this blog. This blog reflects part of my law practice. You will find articles probate, civil suits, Open Door Law, debtor-creditor law and collections, business law, and related matters. You can find all of subjects below organized under "What I have written about by topic." You can also find other articles by using the search function at the top of the page. As a solo practitioner, I write to express my opinions on the law and the practice of law in Indiana, and to inform the general public. You will also links below here to other law blogs and online resources. If you would like to start a conversation on an article, there is a comment function after every article. However, while I hope you enjoy the blog and that it helps you understand the law, remember that nothing here substitutes for an attorney of your own. If would like to contact me personally about taking on a legal matter for you, my contact information is directly below.
About Me
Sam Hasler
Welcome to my blog on Indiana family law. For more about me, follow the link here to view my complete profile. If you are looking to hire an lawyer, please give me a call or send me an e-mail. My contact information is right below this section.
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