Articles

Incurable Defaults and “Good Cause” Requirements – by co-author C. Griffith Towle

Many franchise agreements contain provisions allowing the franchisor to terminate the agreement without affording the franchisee an opportunity to cure. These sections are typically reserved for egregious breaches, and the commission of one of these breaches by the franchisee constitutes an incurable default. However, some states prohibit a franchisor from terminating a franchise agreement without "good cause."

Secrets Service – by Benjamin K. Riley

It's Friday afternoon. One of your most important clients calls and says that its key technologist is leaving the company and is starting a similar job with a competitor on Monday. The client believes that many of the company's most important trade secrets will go with him. What do you do?

Defending “The Last Man Standing”: Trench Lessons from the 2008 Criminal Antitrust Trial (United States v. Swanson) – by co-author Robert H. Bunzel

Gary Swanson, a senior sales executive of Hynix America, was indicted for conspiring to fix Dynamic Random Access Memory (DRAM) computer chip prices in violation of Section 1 of the Sherman Act. . . . The government investigation of the DRAM cartel began in early 2002, and by the time of the Swanson trial, four companies, Samsung, Infineon Technologies, Hynix, and Elpida Memory, and fourteen out of sixteen "carved out" individuals, had pled guilty resulting in fines and penalties of over $731 million. The four-week trial ended with a hung jury, and a mistrial was declared on March 6, 2008, after seven days of deliberations.

Three Pitfalls for Trade Secret Plaintiffs – by Benjamin K. Riley

Arising from the intersection of cutting-edge technology and outright theft, trade secret litigation offers many fascinating challenges. But traps for the unwary plaintiff lurk at every stage of the proceeding. This article discusses three evolving pitfalls awaiting the trade secret plaintiff: the initial disclosure and description of the trade secrets, the problems encountered in responding to contention interrogatories regarding misappropriation that can be answered only by the plaintiff's expert, and the need for the damages expert to consider apportioning damages among multiple alleged trade secrets.

Unconscionability and Franchise Litigation – by co-author C. Griffith Towle

The doctrine of unconscionability appears to be in a state of flux, and it has yet to be determined what effect the recent California and Ninth Circuit cases will have on future decisions in those jurisdictions, and whether and how the impact of those decisions will extend elsewhere. However, the First Circuit's recent Kristian decision, in which a court thousands of miles from California and the Ninth Circuit struck down provisions precluding class arbitration and damage provisions because they frustrated the vindication of statutory rights, should make all franchise lawyers sit up and take notice.

Frequently Arising Issues In Litigation – Handling Defaults and Terminations Effectively and Lawfully – by co-author C. Griffith Towle

Issuing a default or terminating a franchise are serious matters. From the franchisor's perspective, it is essential that its franchisees comply with their responsibilities under the franchise agreement (e.g., paying royalties and the like) and that it take all appropriate steps to protect the brand. From the franchisee's perspective, the franchised business is often his/her sole or principal source of income. From either party's perspective, issuing a default or terminating a franchise are likely to have far-reaching consequences. For this reason, it is important that a franchisor carefully consider the pros and cons before issuing a default or terminating a franchise.

Tips For A Successful Arbitration – by Benjamin K. Riley

As courts rely more heavily on ADR processes to resolve cases, and business lawyers steer their clients away from jury trials, business trial lawyers increasingly find themselves in various arbitration forums. While presenting a case in a hot, interior conference room may not measure up to the courtroom scenes we imagined in law school, arbitration can offer the trial lawyer some of the best opportunities to hone direct and cross-examination skills.

Litigator’s Guide to Franchise Terminations – Settlement – by C. Griffith Towle

For many clients, it is sometimes difficult to fully appreciate all of the benefits that come from settling a dispute instead of pursuing litigation. For a number of reasons, that seems to be particularly true in franchise terminations. The franchisor may believe that the integrity of the franchise system hangs in the balance, the franchisee's livelihood may be at stake, emotions are involved, and lines in the sand may be drawn. Counsel may also be guilty of failing to perceive the benefits of settlement. After all, trial attorneys are trained to attack and win. Settlement somehow seems less satisfying. Despite all of this, in all but a small percentage of cases, settlement is unquestionably the best alternative.

Keeping the Enforcers at Bay – Handling an FTC or State Franchise Investigation – by co-author C. Griffith Towle

The process by which the Federal Trade Commission and comparable state authorities evaluate, commence and undertake an investigation of a franchisor's alleged wrongdoing is the subject of much speculation and misperception. The purpose of this article is to shed some light on the process and provide constructive suggestions on what to do if your franchisor client is the subject of an investigation or your franchisee client believes that its franchisor violated the Federal Trade Commission Act or a state equivalent.

Some Approaches to Litigation Management – by C. Griffith Towle

What is "litigation management?" Does the answer depend on whether you are the client, an in-house attorney or outside counsel? Or is it generally a function of the nature of the underlying case? Whether you are the client or outside counsel, and whether the case is a garden variety breach of contract claim or a class action, effective litigation management is the ongoing process of trying to obtain a cost-efficient and favorable outcome.