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Intellectual Property

Copyright Infringer Receives Nearly 5 Years in Prison
James Baxter, of Wichita, Texas, was sentenced to 57 months in federal prison for violating federal copyright law. From 2006 to 2007 he sold “backup” copies of Adobe products such as Photoshop and Illustrator on various websites that he owned and operated. Baxter is the seventh man from one Wichita piracy ring to be convicted of software copyright violations. Altogether the piracy ring received $3 million in illegal sales from $15 million worth of infringing products.

Corporate Governance & Shareholder Activism

AOL Activist Shareholder Starboard Value Nominates Slate of Directors
Starboard Value, a New York-based hedge fund and activist shareholder of AOL, nominated its own slate of directors for election to the AOL Board at the company’s…

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Today Fenwick & West released the results from their fourth quarter 2011 venture capital survey. Overall, the survey painted a positive picture of the venture capital landscape. Up rounds outnumbered down rounds by more than 4 to 1. This was the tenth quarter in a row that down rounds were exceeded by up rounds. Overall, venture investment was significantly higher in 2011 than 2010, and the average deal size increased in 2011. More venture capital was raised in 2011 than in 2012, although there were fewer funds raising money. Average valuations in the quarter increased by 85% improving on the 69% increase seen in the third quarter of 2011.

Not all of the survey results were positive. M & A activity…

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We are excited about the potential benefits the proposed Seattle arena will bring to local business owners and the Seattle economy as a whole.

2008 was a tough year for Seattle. In addition to the financial crisis, Seattle area sports fans and Seattle business owners had the added indignity of losing the Seattle SuperSonics.  However, Seattle basketball is back in the news and this could mean more business for Seattle construction companies and a boost in profits for Seattle business owners. As avid sports fans, we were pleased to hear the proposal for the new arena. We are also excited about the potential benefits to local business owners and the Seattle economy as a whole.

The Proposal
Seattle-born Chris Hansen proposed a $500 million plan to bring Seattle an NBA basketball team and an NHL hockey team. The plan includes the construction of a multi-purpose arena…

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Today’s post details the most notable reasons why venture capitalists prefer to invest in corporations.

With the rise in formation of limited liability companies (LLC), why do venture capitalists (VC) still prefer to invest in corporations? This is a common question within the startup community. With so many choices—partnership, LLC, S corporation (S corp), C corporation (C corp), etc.—it can be a challenging task to pin down exactly what form of legal entity to choose for your new business. However, if your business plan is dependent on seeking VC funding, your entity choice can be narrowed down to one: the C Corp. Today’s post details the most important reasons why venture capitalists prefer to invest in corporations.

Stock and Shareholder Restrictions
One benefit to a  C corporation is that it allows for two or more classes of…

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Suppliers & Distributors & Disputes

Amazon Pulls More Than 4,000 e-Books from Online Marketplace
In a dispute over e-Book discounts, Amazon has decided to stop offering e-Books published by Independent Publishers Group in its online marketplace. IPG is the nation’s second largest independent publisher, and has refused to come to terms with Amazon in a dispute over a contract renewal. The problem for IPG is that Amazon’s Kindle accounts for 60% of all e-book sales. If they don’t give in to Amazon’s demands, they lose out on a majority of the market. IPG has told its publishers to stress to their consumers that their content is available from Barnes & Noble, and Apple, among other places. This story is a reminder that businesses must proceed with caution…

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Below are two of the more common ways we believe local distilleries, and other businesses, may use to distribute their products.

November’s passage of Initiative 1183—which will shut down the state liquor stores on May 31 and privatize liquor sales— has opened the door to a new era of liquor distribution in Washington State. Since November, many distillers have been concerned about how they would continue to get their products in the hands of customers. Starting March 1, distillers can sell liquor directly to restaurants, bars and nightclubs. On June 1, distillers can distribute to supermarkets and other retailers.

At inVigor Law Group we started thinking about the different approaches local distilleries may use to distribute their products. Generally, there are a limited number of ways to distribute your product, below are two of the more common ways we believe local distilleries,…

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Today’s guest blog is written by Danielle Rodabaugh, the chief editor of SuretyBonds.com, an online surety bond company. As a part of the company’s educational outreach program, Danielle writes articles that outline the legal implications surety bonds could have on business owners and their lawyers. In today’s article she discusses costs associated with licensing and registering businesses, surety bonds, and background checks.

When preparing to start a new enterprise, business owners have a myriad of legal concerns that compete for their constant attention. At times they might struggle to keep track of every single business law and regulation that could affect their new start-up. As such, business owners often forget to budget for some crucial legal costs. To help alleviate the financial…

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Today, we’re continuing our series on key term sheet provisions by discussing registration rights.

What Are Registration Rights?
Before you understand registration rights, you should familiarize yourself with registration statements. Form S-1 is the registration statement companies file with the SEC to become a publicly traded company. If you want to see what a completed S-1 looks like, you can check out Facebook’s registration statement here.

Registration rights define the rights of investors to cause the company to file a registration statement, or to participate in a registration. The registration rights also apply to initial registrations (when the company “goes public”) and to registrationss made after a company has gone public.

What Are the Different Provisions That Make Up the Registration Rights Section?
There are…

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Aside from choosing what form of entity for your business, one of the most important considerations while forming a company is the exit strategy.

Aside from choosing what entity to form your business as, one of the most important considerations in the early stages of forming a company is the exit strategy. Ironic as it may sound, deciding how to get out of the business in the beginning can save you and your business partners time and money down the road. As we’ve discussed throughout our series on LLC Operating Agreements, there’s tons of flexibility when deciding what provisions to include in your operating agreement. It’s no different when deciding on exit strategies, restrictions, and procedures for your LLC. Some operating agreements are silent on this point, while others include extensive restrictions and procedures for getting out of the company. Today’s post will detail some of…

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Mergers & Acquisitions

Kellogg, Not Diamond Foods, to Acquire Proctor & Gamble’s Pringles Brand
Kellogg is acquiring Proctor & Gamble’s Pringles brand after a deal with Diamond Foods fell through. Diamond Foods had been poised to acquire Pringles for $2.695 billion. However, that deal crumbled apart after Diamond Foods announced that the last two years of financial statements will need to be restated. Proctor & Gamble is the big winner here, as Kellogg is actually buying Pringles at $2.7 billion, exceeding the Diamond Foods bid by $350 million. The big takeaways from this deal are one, that sometimes it pays to be patient, and two, that corporate sellers should expect to be thoroughly investigated. Proctor & Gamble should have done more due diligence before agreeing to sell to…

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