Litigation & Dispute Resolution

City of Seattle Tentatively Agrees to Settlement with Yellow Pages Publishers

The City of Seattle and the yellow pages publishers have reached a tentative agreement in which Seattle will pay the publishers $500,000. The settlement comes as part of a claim that the City of Seattle violated the publishers’ free speech rights. The city lost the case in the U.S. Supreme Court in October, and has chosen not to pursue an appeal. The 9th Circuit Court of Appeals ruled that a city ordinance violated the publishers’ free speech rights.

The city ordinance created an opt-out registry for unwanted phone books and charged publishers a disposal fee for recycling costs. The 9th circuit panel rejected Seattle’s argument that the yellow pages are commercial speech and not subject to the First Amendment protections. Seattle...

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Litigation & Dispute Resolution

Apple CEO Dismisses Lawsuit as “Silly Slideshow”

Last week we wrote about Greenlight Capital’s lawsuit against Apple Inc. The hedge fund manager David Einhorn filed the lawsuit to contest Apple’s proposition to eliminate the board’s ability to issue preferred shares without shareholder approval. Today, Apple CEO Tim Cook called the lawsuit a “silly slideshow” while speaking at a Goldman Sachs investor conference.

Cook noted that the disagreement between Einhorn and Apple stems from a proposal on Apple’s proxy statement which it filed with the SEC in December. The crux of the dispute centers around how to issue preferred stock and who is able to approve new shares. The proposals in the proxy statement come as part of Cook’s plan to improve the corporate governance of Apple.

Cook stated, “So...

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Mergers & Acquisitions

AB InBev in the Middle of the Record Flood of Antitrust Suits

Anheuser-Busch InBev NV’s $20.1 billion proposed takeover of Mexican beer distributor Grupo Modelo SAB has come to a halt after the Justice Department has filed suit to block the merger. This suit comes as part of a flurry of civil antitrust cases, signalling what many some believe to be the Obama administration’s increased willingness to intervene in the markets.

Currently there are seven antitrust cases in litigation, the most ever at one time. A spokeswoman for the Justice Department stated, “if the parties are not willing to offer a remedy or enter into a settlement that resolves our competitive concerns, we are prepared to litigate.”

This attitude is in stark contrast to the Bush administration. There was far less emphasis on the...

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Corporate Finance & Securities

President Obama Appoints New Head of the SEC

Yesterday, President Obama named Mary Jo White, the first female United States attorney in Manhattan, to the head the Securities and Exchange Commission (SEC). Many believe that the appointment of White, a former prosecutor and the first prosecutor to head the SEC, signals a renewed resolve to hold Wall Street accountable for any wrongdoing. White is well-known for her aggressive prosecution tactics.

White spent more than a decade as a federal prosecutor in New York City, where she pursued white-collar crime and Wall Street fraud. One of her most infamous cases involved prosecuting former crime boss John Gotti. Another one of White’s better known cases involved prosecuting those individuals responsible for the 1993 World Trade Center bombing. For a more extensive...

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Litigation & Dispute Resolution

Federal Class-Action Securities Lawsuits Slow Down in 2012

The stock market improved in 2012 and the demand for federal shareholder lawsuits slowed down. Coincidence? I think not. The better the market is performing, the happier shareholders will be.

A new study by Cornerstone Research reports that 152 federal class-action securities lawsuits were filed in 2012. This number of cases is well below the average of 193 suits in the prior 15 years, and significantly less than the 188 cases in 2011. According to the study, the drop in lawsuits was consistent across a broad spectrum of legal areas. For example, merger-related lawsuits fell by nearly 33 percent in 2012 from 2011.

Another interesting fact is that filings against Chinese companies that pursued stock listings in the U.S. fell to 10...

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Contracts

Understanding Contract Terms (post 6): Arbitration

As is the case with all the terms we discuss in this series, you have likely run across the term arbitration in a number of contracts. You also probably have a vague idea of what arbitration is. Today’s post will give you a better understanding of why contracts include an arbitration clause, including some of the benefits and drawbacks to using arbitration instead of the traditional litigation process.

First things first, let’s explore the definition of arbitration. Webster’s Dictionary defines arbitration as the hearing and determination of a case in controversy by an arbiter. Essentially, when a dispute arises between two parties, the case is brought before a neutral third party (the arbitrator), and each side presents its side of the...

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Corporate Finance & Securities

Recent Cases Affirm Difficulty in Challenging Board Decisions on Executive Compensation

Two recent Delaware cases confirm that the Court of Chancery will not substitute its judgment for that of a disinterested and informed board on executive compensation decisions, including severance, so long as there is a rational basis for the board’s decision. Reaffirming its reliance on the business judgment rule, the court decided in favor of the board’s decision in two recent derivative actions challenging severance/retirement packages for departing employees.

Zucker v. Andreessen In Zucker, the court granted defendant Hewlett-Packard’s motion to dismiss on claims that HP’s directors committed corporate waste by approving a $40mm severance package for its former CEO, Mark Hurd. In ruling, the court found that there was some rational basis for the board of directors to decide that the...

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Litigation & Dispute Resolution

Delaware Courts Top U.S. Survey of Courts

For the ninth consecutive year the Delaware Courts have been listed as the top courts in the U.S. The survey, sponsored by the U.S. Chamber Institute for Legal Reform, takes into account a number of factors, including judges’ impartiality, timeliness of decisions, and judges’ competence. On the other end of the spectrum is Chicago, deemed the worst court system in the U.S. by the survey. Washington state was the 22nd ranked state.

What makes Delaware Courts so special? One of the major reasons that Delaware Courts are held on such a high pedestal is that they have a specialized court system known as the Court of Chancery that handles all corporate matters in Delaware—which comprise the vast majority of litigation in Delaware....

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Intellectual Property

Apple Rewarded Handsomely As Jury Finds Samsung Guilty of Infringement

It took less than three days of deliberation, approximately 22 hours, 109 pages of jury instructions, and a verdict form with nearly 700 individual questions for the jury to find Samsung guilty of infringing a number of Apple’s patents. As a result, Apple was awarded $1.05 billion in damages—nearly half of the $2.5 billion Apple requested—which is one of the largest intellectual property awards ever. Furthermore, there is speculation that Apple’s victory will provide the mobile (and computer) giant ample ammunition to launch similar attacks on its remaining mobile-phone rivals.

The jury found that Samsung infringed six out of the seven patents at issue, and that Apple didn’t violate any of Samsung’s five patents at issue in the case.

This outcome will...

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Intellectual Property

Apple-Samsung Trial Goes to Jury; See Each Side’s Proposed Verdict Form

The highly-publicized patent battle between Apple and Samsung will be handed over to the nine person jury this week. This case involves a complicated  battle over intellectual property, including several patents held by both Samsung and Apple.  So, what is required of the jurors?

One of the Wall Street Journal blogs, Digits, published an article with the proposed verdict forms from both Apple and Samsung. You can see Apple’s verdict form here, and Samsung’s verdict form here.

The forms include dozens of questions, with the basic goal of asking jurors to answer “yes” or “no” whether each device infringes a patent. These questions give way to fill-in-the-blank questions that ask for specific dollar amounts that Samsung is entitled to as a result...

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