Trademarks - Franklin College Suit From Start to Quick Finish

I learned of the Franklin College trademark case from The Indianapolis Business' College sues like-named competitor and, frankly, did not hold out much hope for the interloper.

The confusion has finally gotten to Franklin College.

The liberal arts college south of Indianapolis filed a lawsuit today alleging trademark infringement against Ohio-based Franklin University, which will open a campus in Castleton this fall.

Franklin University has run a heavy advertising campaign to mark its entrance into Indianapolis. But Franklin College said the marketing blitz has been too close to Franklin College's own branding.

***

Moseley said that since Franklin University's advertising began in May, Franklin College has received many calls, comments and e-mail messages asking why the school has changed its name or whether it has opened a satellite office for online courses. He also complained that the colors and clock tower in some Franklin University ads are strikingly similar to Franklin College's logo.

"We have great concerns about the impact of the obvious confusion, especially with prospective students and employers of our alumni," Moseley stated.

***

In an interview in June, Linda Steele, vice president of marketing for Franklin University, said the school never considered operating under a different name than Franklin in Indianapolis.

"The Franklin College issue came up and we really did have to take a step back and ask the question whether that is a showstopper," Steele said. "Obviously, we think not, because we chose to go forward."

Well, here is the report from The Indiana Lawyer Blog noting that the suit has been settled and has a link to the settlement agreement. Reading the settelment agreement, I think everyone will see a sensible solution that works for the benefit of both parties and also resolves the problem. It may be a bit snarky but perhaps a bit of training on trademarks for the marketing division?

What to do if your company gets a deposition notice?

Read Be Prepared to Deal With Deposition Notices and get ready to call your lawyer:

Your company has just been served with a 30(b)(6) deposition notice under the Federal Rules of Civil Procedure, and it is your job to respond to the notice and determine who will testify on behalf of the corporation. Is there anything you can do to ensure that your company puts its best foot forward at the deposition? The answer is yes: There are numerous strategies for selecting and preparing witnesses to participate in these depositions.

A 30(b)(6) deposition is a widely used litigation tool that requires a corporation to appear at a deposition and respond to questions regarding a specific list of topics contained in the notice. Since these depositions make it easier to depose the right corporate officers and managers on the right topics, as in-house counsel you need to be aware of how to avoid the many potential pitfalls of 30(b)(6).

Take a good look at the list of topics in the notice. Once you fully comprehend the crucial points involved, you need to identify the right witness or witnesses to speak on behalf of your company. Balance the number of witnesses against cost and time constraints.

The scope of a 30(b)(6) deposition is broad: A company can proffer as many witnesses as it needs to cover all areas of inquiry. A corporation may prefer to respond to a particular topic of inquiry covered in a plaintiff's notice by designating several corporate representatives. But doing so may unnecessarily subject the corporation to many hours of deposition testimony that an opposing party otherwise might not have the ability to take. And that isn't necessarily an outcome that you want to encourage.

Oh, if you think just because it says "federal" that this may not apply to you, then think again. Indiana's trial rules have a similar rule for our state courts:

(6) A party may in his notice name as the deponent an organization, including without limitation a governmental organization, or a partnership and designate with reasonable particularity the matters on which examination is requested. The organization so named shall designate one or more officers, directors, or managing agents, executive officers, or other persons duly authorized and consenting to testify on its behalf. The persons so designated shall testify as to matters known or available to the organization. This subdivision (B)(6) does not preclude taking a deposition by any other procedure authorized in these rules.

Thoughts on Strategy, Preventive Law, Rambo Lawyers and Sun Tzu

I wrote about applying Sun Tzu to legal matters in Protecting Your Business and Going to Court. Sun Tzu was an ancient Chinese general who wrote the Art of War. Today, I am writing about litigation and preventive law and why preventive law is the best legal strategy for a business.

Strategy has a central place in business and law. I am thinking of the following definition of strategy:

2 a: a careful plan or method : a clever stratagem b: the art of devising or employing plans or stratagems toward a goal...

Under Indiana's Rules of Professional Conduct, the client has to set the goals and the lawyer has to figure out how to reach those goals.

Mark McNeilly has a web site for his book applying Sun Tzu to business (and he is not the only one apply Sun Tzu outside the military; see here and here and here and here). I suggest reading his article, The Six Principles from Sun Tzu and the Art of Modern Warfare.

Sometimes clients want an all-out war. Panic and/or anger motivate this kind of strategy. They do not like being told to consider the costs and the benefits of this strategy. They will say that cost is no objective. I generally avoid these kind of clients - in the end costs mean everything. This past year I dealt with two clients of this type. Before you start a total war consider this:

If the goal of a country is to survive and prosper, then what is the goal of its strategy? Sun Tzu offers this advice:

Your aim must be to take All-under-Heaven intact. Thus your troops are not worn out and your gains will be complete. This is the art of offensive strategy.

The second principle is an important tenet of this philosophy: avoid strength, attack weakness. This principle discusses how to win All-under-Heaven intact.

Now an army may be likened to water, for just as flowing water avoids the heights and hastens to the lowlands, so an army avoids strength and strikes weakness.

Although many generals prefer to attack each other head-on, this approach is very costly. As discussed earlier, wars of attrition can last for months and even years, leaving both sides in a weakened state. Instead, using the method of avoiding strength and attacking weakness maximizes one's gains while minimizing the use of the nation's resources. This, by definition, increases prosperity. This principle is discussed in detail in Chapter 2, Avoid Strength, Attack Weakness: Striking Where The Enemy Is Most Vulnerable.

For the two years (almost) of this blog, I have tried to tout the virtues of preventive law. Since this goes against the common conception of lawyering, I have met with no success. With the worsening economy, I expect to see even more businesses straining to save pennies so that they can waste dollars. Litigation may be necessary but it should not the first resort of any business fro dealing with its legal issues.

Not that the Bar does much to dispel the public's idea that the knuckle-dragging, take no prisoners litigator is the epitome of a trial lawyer. We even have a term for them: Rambo litigators. Go back to my quote from McNeilly and you will see who is not the Rambo litigator in that quote. Compare that with Proper Handling of the "Rambo" Litigator and you should see the weaknesses of the Rambo litigator. The public does not seem to understand the difference between fighting hard and and a noisy fighter. As the song goes, not all that glitters is gold.

Consider this paragraph from "Rambo" Litigators Are Losers -- And So Are Their Clients:

"There is a common MISperception in the public that the 'Rambo' or 'pit bull' litigator is a good thing, and that those types of litigators are more successful than others. That's a myth. The reality is that such litigators 1) act like that because the are more interested in soaking their client for fees than in actually getting a good result, 2) engage in such tactics to leverage a settlement because they are terrified of actually having to go to trial, and 3) are less successful than attorneys that follow the rules and know the law."

Why do I think preventive law is the best idea for businesses? Waiting for the Complaint to arrive means that the other side gets to choose the ground for the lawsuit. In any fight, each sides wants to choose its won ground. The Yankees prefer Yankee Stadium and I suspect George Custer wished he had chosen some place else other than the Little Bighorn.

What makes preventive law better for a business than an army of Rambo litigators? Let us go back to Sun Tzu for the utility of prevention:

3. With regard to ground of this nature, be before
the enemy in occupying the raised and sunny spots,
and carefully guard your line of supplies.  Then you
will be able to fight with advantage.

4. Ground which can be abandoned but is hard
to re-occupy is called entangling.

5. From a position of this sort, if the enemy
is unprepared, you may sally forth and defeat him.
But if the enemy is prepared for your coming, and you
fail to defeat him, then, return being impossible,
disaster will ensue.

6. When the position is such that neither side will gain
by making the first move, it is called temporizing ground.

7. In a position of this sort, even though the enemy
should offer us an attractive bait, it will be advisable
not to stir forth, but rather to retreat, thus enticing
the enemy in his turn; then, when part of his army has
come out, we may deliver our attack with advantage.

8. With regard to narrow passes, if you can occupy
them first, let them be strongly garrisoned and await
the advent of the enemy.

The book has other examples comparing and contrasting the arrival of the army at a position before the enemy (for commentary on this section of The Art of War go here). Preventive law works to get the client in a good position before a lawsuit.

Do not think that I am alone in my thinking about applying Sun Tzu to litigation, or how The Art of War provides the antithesis of the Rambo litigator. You may also want to read The Art of War and Public Relations: Strategies for Successful Litigation PR and Successful Early Resolution Strategies (PDF format) and SUN TZU's TIPS on Effective Mediation. The pithiest example of similar thinking comes from nanowerk.com's Nanotechnology litigation: Winning the war before it starts:

"In the 6th century B.C., Chinese strategist Sun Tzu observed that “victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win.” These words remain instructive for 21st century nanotechnology companies inevitably facing growing litigation risks as concerns about health and environmental implications continue to mount. As scientific research, regulatory action, and public opinion begin to crystallize, businesses still have a rare chance to shape the future fight. By anticipating trends and taking proactive measures now, nanotechnology companies may even win the war before it starts."

Sun Tzu also wrote about "The Nine Situations." These are:

 1. Sun Tzu said:  The art of war recognizes nine varieties of ground:
(1) Dispersive ground; (2) facile ground; (3) contentious ground;
(4) open ground; (5) ground of intersecting highways;
(6) serious ground; (7) difficult ground; (8) hemmed-in ground;
(9) desperate ground.

I have always read them as being about position and what to do in these situations. (For more detailed commentary on these nine situations, go here). That is get the other side on desperate ground for the fight. Without the client involving its attorney into its strategy, the other side gets to choose the ground for the fight and gives to them the advantage of placing the business into desperate ground.

Not that preventive law will remove all risk of litigation. As we have seen from the recent Wall Street debacle, anything thinking they can eliminate all risks are delusion. What preventive law can do is mitigate risks of litigation and litigation's costs. I cannot think of a better conclusion to this discussion of preventive law and Rambo litigators than this from The Art of War- Litigation and Business Mediation by Ashley Mediation Centers:

"Such litigation practices are, in fact, the product of poor lawyering. As Sun Tzu wrote:

'To fight and conquer in all your battles is not supreme excellence; supreme excellence consists in breaking the enemy’s resistance without fighting.'"

But how does one break the will of one’s adversary to litigate without litigating? The answer, according to Sun Tzu, lies in making careful calculations prior to commencing litigation which assure victory.

"The general who wins a battle makes many calculations in his temple before the battle is fought. The general who loses a battle makes but few calculations beforehand. Thus do many calculations lead to victory, and few calculations to defeat; how much more no calculation at all! It is by attention to this point that I can foresee who is likely to win or lose."

This may appear as an admonition to be smart — but guidance many of us may be constrained from observing by genetics. What Sun Tzu is really saying, however, is to fully use the intelligence one has to carefully think through the strategies one intends to apply to bring about victory as quickly and painlessly as possible. One must resist the temptation to mindlessly implement the same tactics one has regularly employed in the past. Always ask where the opponent’s vulnerable points lie, and how one may fully exploit them within the limits of the ethics and mores of our profession and society.* One’s goal should be to elevate oneself to the status of the "victorious strategist," who Sun Tzu describes as follows:

"Thus it is that in war the victorious strategist only seeks battle after the victory has been won, whereas he who is destined to defeat first fights and afterward looks for victory."

At the same time, one must accept without shame that sometimes, no matter how carefully are laid schemes, a case cannot be won. The "terrain" (facts) may not be as the "spies" reported; the "gods" (judges) may throw "thunderbolts" (adverse rulings) at one’s advancing army; or one may find the army swept up by an unanticipated "flood" (change of law). Nevertheless, one may still look oneself in the mirror with the knowledge that Sun Tzu regarded the general who "retreats without fearing disgrace, whose only thought is to protect his country and do good service for his sovereign, [to be] the jewel of the kingdom."

Collections: Fraudulent Transfers, New Case from the Indiana Court of Appeals

The Indiana Court of Appeals held in Hoesman v. Sheffler (pdf) format that a debtor is not a necessary party to a fraudulent transfer suit (pages 8 -9). Hoesman involves a trustee converting money in a trust. Those thinking of a trust with a relative should read this case. Cases like Hoesman are why I recommend an institution instead of an individual as trustee.

The Court of Appeals also discusses the issue of getting value for an alleged fraudulent transfer (pages 10- 12) and the "badges of fraud" (pages 12 - 15). Reading the discussion at page 10 -12 about good faith purchasers, I am of the opinion that this case will bear directly on Indiana's assignment for benefit of creditors statute.

The opinion also discusses IC 30-4-3-22(c) and the priority of liens.

Ah, The Vagaries of Litigation

Read Trade Secret Jury Verdict : Redwood Health Services v. Clifford Der, dba Benefit Brokerage Services from The Trade Secrets Vault Blog to understand what I mean by vagary.

Verdict-Defendant : The jury found in favor of the plaintiff on the counts of breach of fiduciary duty and interference of contract, and awarded it $59,780. The jury found for Der on the counts of breach of contract and common counts, and awarded him $135,291.

I see here a good example of why cases settle rather than going to a jury and leaves me with questions of evidence.

New Court of Appeals Case on Crime Victim's Statute, Mortgage Foreclosure and Fidicuiary Duty

And discovery sanctions and attorney fees and garnishment orders. At sixty-seven pages, I still have not fully digested Prime Mortgage USA, Inc. v. Nichols (PDF format) beyond recognizing that this looks like a bombshell of a case. The Court of Appeals describes the issues as follows:

Issues

1. Whether Nichols's claim under Indiana Code section 34-24-3-1 (the "Crime Victims Statute") is barred by the statute of limitations;

2. Whether the Defendants were entitled to a jury trial on the amount of damages under the Crime Victims Statute:

3. Whether the trial court abused its discretion in ordering default judgments as a sanction for discovery violations:

4. Whether the trial court's award of damages was proper and supported by the evidence;

5. Whether sufficient evidence existed to hold the Defendants liable under the Crime Victims Statute;

6. Whether the trial court's award of attorney's fees was improper:

7. Whether the trial court improperly determined that Nichols's unpaid compensation constituted "wages" under Indiana Code sections 22-2-5-1 and -2:

8. Whether Nichols's claims are barred by the doctrine of unclean hands: and

9. Whether the trial court's garnishment order was improper under either Indiana Code section 27-1-12-14(e) or Indiana Code section 27-I-I 2-17.1(1).

That list excludes one important issue and why I fully expect a petition to transfer to the Indiana Supreme Court is being contemplated by the appellant: "The trial court held a hearing on damages. and awarded roughly eight million dollars to Nichols."

I plan on breaking the case down by topic in separate posts rather than one big post. Stay tuned.

Civil Suits - What Happens After Getting A Summons

Or, When Do I Go to Trial?

I get asked that question too often and I thought an outline of what happens in a case as the defendant might make some good reading. I do need to say this outline applies only to cases that are not small claims cases.

You have a summons and a Complaint stuck in your door or handed to you or sent by certified mail. You have been served (think tennis for half a second here) and you are now a defendant in a civil suit. The Indiana Trial Rules have several rules on process and summonses beginning with Rule 4 and going to Rule 4.17. and What happens next?

Well, you can do nothing. Then after twenty or twenty-three days, the Plaintiff (the person suing you) can ask for a default judgment. Take a look at Indiana Consumer Lawyer Blog's very good post on default judgments Default Judgments in Indiana for more detail.

What should have been done is get a lawyer. If you did the case will go generally like this:

1. File an Answer or a motion to dismiss. No Answer can lead to a default judgment, again. If the motion to dismiss is granted, then the case is over. Here is the first method the system has for getting rid of lawsuit. You can file a counterclaim, which is a suit by the defendant against the plaintiff. Once the parties file their Answer, any counterclaims, and any replies to a counterclaim, the next step is discovery.
2. Discovery. The Complaint only gives you an outline of why you are being sued and not the facts behind the allegations. Discovery exists to get at those facts. I think discovery is probably the most expensive phase of a case. Lawyers want to know everything there is before we start a trial and we will do our best to get at that information. We can use depositions (Trial Rules 27 to 32), Interrogatories, Motion to Produce Documents, the physical and/or mental examination of persons, and requests for admissions.
3. As soon as we can all see the other side's cards, we make a decision if there is a dispute of fact and of law or only of law. If there is a dispute only of law, then a Motion for Summary Judgment gets filed which allows a judge to decide not on the facts but only on the law. Summary judgment motions are the second means of winnowing out weak cases. If the judge does not grant a Motion for Summary, then it is time for trial.
   
4. If a dispute of fact and of law exists and no settlement, then we go off for trial.

Litigation: Indiana Jurisdiction Over Out of State Companies

I chucked a post on Indiana's long-arm jurisdiction when I saw COA: Court has personal jurisdiction over CIDs in yesterday's Indiana Lawyer Daily:

Indiana trial courts can assert personal jurisdiction over out-of-state companies for the purposes of enforcing an Indiana Attorney General's petition to enforce a civil investigative demand, ruled the Indiana Court of Appeals today.

***

In Everdry Marketing and Management, Inc. v. Steve Carter, Attorney General of Indiana, No. 49A02-0706-CV-452, Everdry, an Ohio corporation that provides waterproofing services for homes, had franchises operating in Fort Wayne and Indianapolis. It had not filed a Uniform Franchise Registration Application with Indiana before franchising the company. After receiving complaints about the Indiana franchises failing to honor "lifetime warranties" on Everdry's waterproofing systems, the Attorney General's office found Everdry's Web site contained a very similar warranty statement as the one that appeared in the customer's contracts. Pursuant to Indiana Code Section 4-6-3-3, the Attorney General's office issued a CID upon Everdry at its Ohio office. CIDs are a pre-litigation tool to determine whether an Indiana law has been violated and address whether a subject has certain information relevant to the investigation.

Reading the opinion, I see a rather lengthy discussion of both CID's and the jurisdiction of Indiana's courts. Worth a good look by anyone facing the issue of being from out of state and being hauled before an Indiana court.

This particular case turns on whether Everdry consented to Indiana jurisdiction because of its franchising activities in Indiana. The Court of Appeals held that it had consented to jurisdiction.

However, the Court of Appeals did not stop there. The Court of Appeals proceeded to analyze Everdry's contacts with Indiana pursuant to Indiana Trial Rule 4.4(A) and constitutional due process (for the lawyers in the crowd: International Shoe does get a mention).

Out of state franchisors need to pay attention to this case. I expect a petition to transfer to the Indiana Supreme Court and we will need to see if that court accept transfer.

My original post on this subject will be up tomorrow.

Thoughts on Business Litigation and Attorney Fees

I had a rather unpleasant conversation with a now former client this morning. Looking back at the conversation as charitably as possible, I am again surprised by how some business clients do not realize that lawyers also are running a business.

When a client does not pay on time or not at all, this affects service to all clients. That is as true for my business as for my business clients.

Oddly enough, the conversation did not begin about fees and what turned the conversation about fees was something I said about if the client wanted to continue pursuing the matter. I mentioned a cost-benefit analysis, was shouted down and the telephone conference went downhill from there.

I believe that every client needs a cost-benefit analysis of any lawsuit. The client should know the costs that will come from the litigation and then decide if the benefits make the litigation worthwhile. Attorney fees make up only a part of those costs:

1. The time spent producing documents, answering Interrogatories, and attending depositions.
2. The upfront costs of our own depositions and paying for copies of depositions taken by the other side.
3. The time spent in court and hanging around a courthouse instead of at the business.

On an hourly basis, the attorney fees could easily exceed $6,000.00 for a simple trial that lasted only one day. The client then would need to decide if the costs were worth paying to defend a $25,000.00 claim or making a settlement offer to get rid of the nuisance.

Take a look at Two lawyers walk into a bar . . . from The Chicago Tribune for a bit more of an insight into attorney fees and law practices.

Evidence - The Dangers of Digital Photos

Maybe you knew about metadata (that is, data on data) with digital pictures but I did not. Not until I read Beware of hidden digital camera metadata from Canadian Privacy Law Blog and Authenticating Digital Photographs as Evidence: A Practice Approach Using JPEG Metadata from Law Practice Today. This paragraph from Canadian Privacy Law Blog sets up the problem nicely:

There is no better illustration of the problem than the website created by Tonu Samuel. His site pulls images off the 'net then shows the original thumbnail and the modified image. One image generated by Samuel's site is a very vivid demonstration of why this is an issue: Hidden EXIF thumbnail security problem (may not be safe for work - it shows a young woman in a bikini whose face was obscured but is clearly identifiable in the thumbnail).

In short: Be very careful when you distribute modified digital images.

So what? Think about this scenario: digital photos come into evidence and then the metadata shows the photo's alteration. I will bet the party putting that photo into evidence gets chewed up and spat out.

Statute Limitations Do Not Bar a Lawsuit, but Here is What Does

A statute setting the time limit for filing a lawsuit bars a claim after that date. That kind of statute is not a statute of limitations.

Attorneys call a statute of limitations an affirmative defense. Defendant has the job of pleading the defense and proving it. The plaintiff wins if defendant either does not plead or pleads but does not prove. (See Indiana Trial Rule 8(c)).

JOHN R. SAND & GRAVEL CO. v. UNITED STATES (html format) gives us the example of a statute creating a deadline for filing a lawsuit against the federal government. The following paragraphs from the United States' Supreme Court opinion contain the facts:

The Government initially asserted that petitioner's several claims were all untimely in light of the statute providing that "[e]very claim of which the United States Court of Federal Claims has jurisdiction shall be barred unless the petition thereon is filed within six years after such claim first accrues." 28 U. S. C. §2501. Later, however, the Government effectively conceded that certain claims were timely. See App. 37a-39a (Government's pretrial brief). The Government subsequently won on the merits. See 62 Fed. Cl. 556, 589 (2004).

Petitioner appealed the adverse judgment to the Court of Appeals for the Federal Circuit. See 457 F. 3d 1345, 1346 (2006). The Government's brief said nothing about the statute of limitations, but an amicus brief called the issue to the court's attention. See id., at 1352. The court considered itself obliged to address the limitations issue, and it held that the action was untimely. Id., at 1353-1360. We subsequently agreed to consider whether the Court of Appeals was right to ignore the Government's waiver and to decide the timeliness question. 550 U. S. ___ (2007).

The court cannot raise the issue of an affirmative defense but it can always raise the issue of having jurisdiction over a case. Justice Breyer explains the legal differences here:

Most statutes of limitations seek primarily to protect defendants against stale or unduly delayed claims. See, e.g., United States v. Kubrick, 444 U. S. 111, 117 (1979). Thus, the law typically treats a limitations defense as an affirmative defense that the defendant must raise at the pleadings stage and that is subject to rules of forfeiture and waiver. See Fed. Rules Civ. Proc. 8(c)(1), 12(b), 15(a); Day v. McDonough, 547 U. S. 198, 202 (2006); Zipes v. Trans World Airlines, Inc., 455 U. S. 385, 393 (1982). Such statutes also typically permit courts to toll the limitations period in light of special equitable considerations. See, e.g., Rotella v. Wood, 528 U. S. 549, 560-561 (2000); Zipes, supra, at 393; see also Cada v. Baxter Healthcare Corp., 920 F. 2d 446, 450-453 (CA7 1990).

Some statutes of limitations, however, seek not so much to protect a defendant's case-specific interest in timeliness as to achieve a broader system-related goal, such as facilitating the administration of claims, see, e.g., United States v. Brockamp, 519 U. S. 347, 352-353 (1997), limiting the scope of a governmental waiver of sovereign immunity, see, e.g., United States v. Dalm, 494 U. S. 596, 609-610 (1990), or promoting judicial efficiency, see, e.g., Bowles v. Russell, 551 U. S. ___ , ___-___ (2007) (slip op., at 7-8). The Court has often read the time limits of these statutes as more absolute, say as requiring a court to decide a timeliness question despite a waiver, or as forbidding a court to consider whether certain equitable considerations warrant extending a limitations period. See, e.g., ibid.; see also Arbaugh v. Y & H Corp., 546 U. S. 500, 514 (2006). As convenient shorthand, the Court has sometimes referred to the time limits in such statutes as "jurisdictional." See, e.g., Bowles, supra, at ___ (slip op., at 5).

You can find most of Indiana's statute of limitations by following this link here.

Take a look at Court Imposes Strict Deadline in Lawsuit, if you want to read more about JOHN R. SAND & GRAVEL CO. v. UNITED STATES.

Civil Suits and Collections

Between a telephone call last evening to reading After losing lawsuit, practice may dissolve this morning, I decided a quick post was needed.

After graduating from last school, I worked for a local collections attorney for about a year. I had no idea that a lawyer could have a practice just collecting money. Law school taught us to know the elements of case, write an appellate brief, and argue a case. Among the many things not taught us was that a plaintiff (the person suing) in a contracts or torts case wants money.

For the non-lawyers reading this, the law requires a showing of injury that can be quantified into dollars. We call that damages. There are other elements, too. In a contracts case, those other elements are duty and breach.

I break collections into two categories. First, Those cases having a fight and the question will be if we when where does the money come from? One can win the battles but lose the war. History is full of examples of this: Germany in World War I, Germany in Word War II until 1941, the American Revolution and an ancient Greek general who gave his name to Pyrrhic victory. The case reported by the Indianapolis Star sounds like one of these:

A Marion County jury awarded Pollack $480,853 in damages after a 21/2-day trial. With interest dating to 1996, when Pollack left the practice, the claim could top $1 million.

An attorney for the 17- employee practice, based on the Northeastside, has proposed to creditors that the practice close its doors and liquidate its assets, which it estimates are worth about $300,000, according to a letter Pollack received from his attorney.

Under the plan, Pollack would collect just $219,000 of his judgment paid over 10 years. Pollack, as a result of his civil damage award, is the practice's largest creditor.

An attorney for Cardiac & Vascular, Michael McCrory, said, "I am not prepared to make a comment" on the likelihood the practice will close and liquidate its assets. The practice was closed for business Monday and Tuesday, and its administrator, Tim Hare, did not return a call seeking comment.

My experience doing collections and bankruptcy work makes me ask about assets and collecting the judgment. I still get people offering me these great cases where I will make a lot of money except that the cases disappear so quickly when I start asking how we will collect that money.

The other type of collection cases pose no great issues of liability (the opposing party's) or damages, but only on how to get the money. I spent a good deal of time the other night explaining how these cases work to a potential client: mostly likely we will get a default judgment and then I will spend a very long time trying to get the money as the defendant had a history of switching jobs. I suspect she operated under the illusion of many that all I had to was get a judgment and the money would appear on her doorstep. Because of people quitting jobs as soon as a garnishment order arrives, a collections practice requires volume for success.

James Bond and Copyright

Got your attention? What could James Bond have to do with copyright? Actually, a bit of an interesting story. Which the London Times brought back to light in The battle for the soul of Thunderball.

For the Bond fans out there - especially those who read the books - they may know that Thunderball had a question of paternity. I remember reading the outline of the story when Connery came back to do Never Say Never. The excerpt from The Battle for Bond published by The Times covers that part as well as the plagiarism trial.

Other than learning that Thunderball was the most successful of the early Connery films (I thought Goldfinger would cop that honor) and Richard Burton was slated to be the first film Bond (no, no, no), I found a great description of the triumvirate of civil litiation. What makes up this triumvirate of civil litigation? People, money, and law.

On November 20, 1963, the Thunderball trial began in earnest. Could McClory prove that his copyright in the Thunderball story had been infringed by Fleming’s novel? Much was riding on the outcome, because, with the release of Dr No and From Russia with Love, starring Sean Connery, Bond was now a cinematic success. There was a lot of money, and some hefty reputations, at stake.

One must not underestimate the personal enmity between Fleming and McClory, clearly shown for the first time in the letters. Neither liked the other during the time they worked together, and they clashed frequently. In one correspondence, Fleming admitted: “I don’t particularly like Kevin personally, because I have never particularly liked Irish blarney.” The letters also reveal that Fleming was plotting behind McClory’s back to remove him from the Bond project. As for McClory, he labelled Fleming “cynical” and “a snob”. One suspects that half of McClory’s motive for his court battle was to put one over on the English Establishment, epitomised by Fleming.

The following paragraphs reminded me of a case I settled a few years back for similar reasons - a question of the client's health being able to endure an extended trial.

All the more strange, then, was what happened on the trial’s ninth day. McClory had just taken the stand when the hearing was unexpectedly and dramatically adjourned: Fleming had decided to settle. But why?

As Fleming had already suffered one serious heart attack, Bryce was worried about the effect the trial was having on his friend. What has not previously been revealed is that Fleming experienced two heart attacks during the case itself. So, after days of wrestling with his conscience, Bryce persuaded his friend to settle, rather than watch him endure the days to come. Fleming’s wife, Ann, was incensed, scrawling in her husband’s copy of Diamonds Are Forever, which had a dedication to Bryce, the words: “The man who betrayed Ian in the Thunderball case.” Fleming, too, was later to bitterly denounce Bryce’s actions. Yet, as Bryce was bank-rolling the defence, the decision was his to make.

Introducing Indiana's Crime Victim's Statute

Indiana law provides a special remedy for victims of some crimes. This remedy is the Offenses Against Property statute. One can find the statute at IC 34-24-3. This article is a bit of a follow up to my post Trademarks: Hershey Sues in Indiana Over Parody.


As I wrote in that article, I find it difficult to explain what attraction the Crime Victim's Statute has for that case.

As for my list, I complied this for an article I never quite finished on this statute. Which means the chart might have a bit more interest to lawyers than to laypeople. The first column lists the crimes which can be used for a civil suit. The remaining columns show the kind of mental state is required to prove a case. Yes, one must show the defendant acted with criminal intent required under the criminal statute.

As anyone can see, the crimes listed are not ones to truly attract a lot of civil llitigation. Some do not even have a very wide application in Indiana (like unlawful acts relating to caves) and others probably lack the prime requirement for a civil suit: a defendant with money.

My experience with the statute begins and ends with check deception, conversion and criminal mischief. The criminal mischief case involved a defendant splattering a very red paint throughout a very white kitchen. While another statute exists for check deception, this statute has fewer procedural requirements.

With conversion cases, this statute allows for attorney fees where common law conversion does not. The attorney fee provision also lead to the use of the statute with the criminal mischief case. Note that the statute requires payment of reasonable attorney fees. However, the judge or jury decides what is reasonable. In my case, the judge cut off about a thousand dollars of fees without any explanation. I put it down to the vagaries of the judicial mind.

I think that we might see use of this statute as part of a qui tam action (welfare and Medicaid fraud), computer trespass and home improvement fraud. Remember, I already mentioned the need for a defendant with money and I presume any use of this statute requires a fund for a damages award. (For those wondering why I emphasize a defendant with money , a suit for damages means a suit for money). I think anyone will see that the statute's protections are far more limited than one might suppose from its title.

I am sure that I have not provided anyone with a clue about why Hershey chose Indiana and this statute.

For Indiana Lawyers:Local Rules Federal Rules About E-Discovery Issues

From the Electronic Discovery Law Blog, Updated List: Local Rules of United States District Courts Addressing E-Discovery Issues : Electronic Discovery Law here is the selection for Indiana:

Northern District of Indiana
Report of Parties' Planning Meeting

Southern District of Indiana
Uniform Case Management Plan (see Part III(K))
Rule 16.1 Pretrial Procedures (requiring use of Uniform Case Management Plan)

Another view on Minnesota downloading case

I mentioned this case in Why juries make lawyers nervous.

The IP ADR Blog also wrote on this case under "B" is for Bully: Jean Valjean at the Music Store. In my earlier post, I used the case to show some of the vagaries of juries.

"A woman facing a $222,000 music-sharing verdict asked a judge Monday to overturn it.

Jurors in a case that six record companies brought against Jammie Thomas found that she violated the companies' copyrights by offering 24 songs over the Kazaa file-sharing network. They ordered Thomas, a mother of two who makes $36,000 a year, to pay the companies $222,000.

In a motion filed Monday, Thomas' attorney, Brian Toder, did not argue that she hadn't violated the copyrights. Instead, he said that because the songs could have been purchased online for about $24, the $222,000 verdict was disproportionate and amounted to punitive damages.

IPR ADR Blog summarizes some facts which some interest besides and beyond the point I made earlier. However, this post does make the point made in my earlier post:

Why the Jury Likely Made the Thomas Award So High

If you've been following this story, you don't have to do much guess work to believe the jury was likely punishing the defendant for lying to them on the witness stand. Although the defendant denied file-sharing on direct examination, documents produced at trial pretty well demonstrated that she was not telling the truth.

Reading about mediation and ADR

Serendipity strikes. Following my post Surprised by mediation statistics, articles on mediation and ADR seem to be popping up. My original find still has me thinking about the benefits of mediation and other forms of ADR. I pass along these other finds for the reader who might be having some of the same thoughts or curiousity as I am (and these are in no particular order other than discovery):

1. Blawg Review #130
2. Blawg Review # 130 (And, no, that is not a typo or a duplication but a joint review of law blogs).
3. I Want to Settle an IP Action; What Do I Do If . . .

Speaking of arbitration

From ContractsProf Blog: There Ought To Be a Law...:

"Arbitration is a creature of contract, and the Contracts course necessarily includes at least a few cases involving arbitration terms. But, pre-dispute arbitration could face its demise in many contexts. Senator Russ Feingold has proposed a bill called the Arbitration Fairness Act, which would invalidate pre-dispute arbitration agreements in employment, consumer and franchise contracts and 'dispute[s] arising under any statute intended to protect civil rights or to regulate contracts or transactions between parties of unequal bargaining power.

The post details the findings of the proposed legislation. This post ends with these two paragraphs:

And, on the heals of this proposal, comes a 74-page report, titled "The Arbitration Trap," by a group called Public Citizen. The report exposes the troubling relationship between certain arbitration providers and the credit card industry, and concludes that pre-dispute arbitration is "a rigged game in which justice is dealt from a deck stacked against consumers."

Nevertheless, the near consensus of predictors is that the bill has no chance of passing (or even getting to the floors of the House or Senate). And, despite numerous academic writings that support these findings and the elimination of pre-dispute arbitration agreements in these contexts, there has been very little popular press coverage of the subject. The most mainstream press I have seen yet is this op-ed piece from Forbes, which, in light of credit card industry practices, encourages the passage of the Arbitration Fairness Act.

Compare this with the earlier post on arbitration, Surprised by mediation statistics.

Surprised by mediation statistics

I was surprised by the post More Statistics on the Differences between Arbitration and Litigation Procedures, Cost, Duration and Outcome on the Southern California Arbitration Mediation and Conflict Resolution Blog. For example:

Time and Cost Differences Between Arbitration and Litigation *

Employment claims take 650 to 720 days to be resolved in court, according to the National Center for State Courts. * The median time to resolve an employee dispute by arbitration is 104 days * the median cost of resolving employment disputes by arbitration is $870.

Sources: Consumer and Employment Arbitration in California: A Review of Website Data Posted Pursuant to Section 1281.96 of the Code of Civil Procedure California Dispute Resolution Institute, August 2004 http://www.mediate.com/cdri/cdri_print_Aug_6.pdf and Examining the Work of State Courts, (1999-2000) National Center for State Courts http://www.ncsconline.org/D_Research/csp/1999-2000_Files/1999-2000_Tort-Contract_Section.pdf

Outcome Differences Between Arbitration and Litigation: Arbitration & litigation final awards are essentially the same as court judgments * median monetary awards for successful claimants are greater in arbitration than in court—$100,000 in arbitration compared with $95,554 in court."

I suggest reading the full article. I have my doubts about arbitration but that doubt comes mostly from choice of law provisions where arbitration is to take place in a state far from Indiana. I am certain that works to the advantage of one of the parties -usually the one that is without the means to travel to the other state or hire out-of-state lawyers.

A few points that seem to escape the polling and studies, ADR does permit privacy to the parties denied by filing a lawsuit. I count that as an advantage for the business client.

From my experience in Indiana, there are two sources for delay:

• First, most Indiana courts have criminal jurisdiction. Criminal cases take priority over any civil case (there is the constitutional right to a speedy trial). Civil trials get bumped from the court's calendar to make way for a criminal trial.
• Second, there is the discovery phase of trial. I am sure discovery increases the cost of civil litigation. We lawyers like knowing everything we can about the opposition before trial begins - so we get documents, we do depositions, and we read and review all the information. Sometimes this phase becomes a sword rather than a shield as parties push depositions (which cost money due to paying court reporters) and dump documents in massive quantities. The movies A Civil Action and Class Action do a good job of showing this aspect of lawyering.

I admit that I am inclined to distrust perfect answers. I continue to see ADR as a tool for my clients but I will have doubts that it will solve all their problems.

Why juries make lawyers nervous

I am reading Good Morning Silicon Valley when I run across She should be glad there wasn’t an option for “truly, utterly, incredibly liable”. I missed the news about a music downloading trial in Duluth which this post covered.

According to Hegg (who, by the way, says he has never been on the Internet), at least two of the jurors wanted to award the maximum damages of $150,000 for each of the 24 songs at issue, while one adamantly held out for the minimum, $750 per. In the end, they settled (though Hegg didn’t explain exactly how) on damages of $9,250 per song, a total of $222,000. “That is a compromise, yes,” said Hegg. “We wanted to send a message that you don’t do this, that you have been warned.” The warning might not have been so stern if the jurors hadn’t felt so insulted. “She should have settled out of court for a few thousand dollars,” Hegg said. “She lied. There was no defense. Her defense sucked. … I think she thought a jury from Duluth would be naïve. We’re not that stupid up here. I don’t know what the (dickens) she was thinking, to tell you the truth."

I emphasized the second sentence above because right there is the thing that makes lawyers squirm with a jury trial. Lawyers prepare jury instructions (so do the judges), lawyers will even argue over jury instructions, and all for the purpose of giving jury's a framework to work within. In the end, juries can do a lot.