It’s human nature to engage in an emotional exhale after reaching an agreement in principle to settle a long-standing or hard-fought dispute. While doing so is all well and good, it is critical that you don’t let that deter you from exercising extreme focus on documenting that settlement in a carefully crafted agreement. Indeed, as the plaintiff in Zvi Construction v. Levy found out a few weeks ago, failing to do so can leave your client in a position where it is unable to obtain the fruits that it rightfully deserves.… Keep reading
During the dog days of summer, anything with the word “freeze” may sound appealing. But if the freeze is a “trustee process attachment” (tying up a bank or other institutional account), a whole different set of emotions can be evoked. As I discussed in Gain Leverage by Freezing Bank Accounts – Part I and Part II, knowing the law surrounding trustee process attachments can create or defuse significant and sometimes dispositive leverage. Further, and as the Federal District Court reminded us recently in DeBenedictis v. Dougherty, the speed with which a party acts or reacts when a trustee process is sought can be critical.… Keep reading
In today’s litigious world, it is all too common for a disgruntled former business partner to file a lawsuit based on legally weak, if not outright frivolous, claims of wrongdoing. One common reaction is to fight fire with fire by filing counterclaims for abuse of process and/or other similar causes of action. While there is a time and place for pursuing such counterclaims, they should be carefully vetted and not instituted based on emotion and/or simply to create leverage. Indeed, as the defendant in Barnum v. Tubifi, Inc. learned just last month, filing a retaliatory counterclaim can result not just in a little wasted time and money, but could lead to court imposed sanctions.… Keep reading
In an earlier post, “Is Arbitration Quicker, Cheaper and Better for You?” I discussed why having a faster and less expensive dispute resolution mechanism may not be in your best interest. Make no mistake, however, the differences between traditional litigation and arbitration go well beyond the time and expense it takes to complete the respective processes. The following are a few of the more notable substantive distinctions between these two dispute resolution mechanisms:
- Litigation allows for extensive “discovery” (e.g., depositions, document requests and interrogatories) from parties and non-parties. Discovery in arbitration often is limited to document requests, but can be broadened by the arbitrator or agreement of the parties.
- Because arbitrators are not required to abide by any Federal or State Rules of Evidence, they routinely consider information that never would be admissible in court.
- A “bad” decision in a court of law almost always can be appealed. An arbitrator’s decision, on the other hand, rarely can be appealed – even if it obviously is contrary to the applicable law.
- Notwithstanding a lack of empirical data, most litigators agree that arbitrators are much more likely than a judge/jury to issue a compromise decision and/or one based on fairness principles
Because the role of most in-house counsel goes well beyond that of providing legal advice, whether communications with in-house counsel are privileged is a much more nuanced issue than it is with respect to communications with outside counsel.
General Principles Applicable to all Claims of the Privilege
1. Not all communications with attorneys are privileged; only communications for the purpose of obtaining legal advice are privileged. Thus, even conversations between a CEO and his or her General Counsel about the most sensitive and confidential aspects of their business are subject to disclosure unless they are for the purpose of obtaining legal advice.… Keep reading
As implied by my prior posting on trustee process attachments (“Gain Leverage By Freezing Bank Accounts – Part I, Offense“), the best way to avoid having your own bank account frozen is to make sure that you do not use a bank that has branches in Massachusetts. Even if your company does bank in Massachusetts, however, there are measures that can be taken to decrease the chances of having the company’s bank account frozen through a trustee process attachment.
An often overlooked fact about trustee process attachments is that payroll accounts are exempt from being attached. Thus, one prophylactic strategy you can employ is to fund your payroll account early and abundantly in order to shield as much money as possible from being attached. Be forewarned, however, that the payroll account exemption only applies if the account is used exclusively for payroll. Thus, if a company places money in its payroll account and later uses it for something other than payroll, the entire account can be attached – even those funds that are needed to comply with the company’s payroll obligation. Accordingly, and because there may be no better way to bring a company to its knees … Keep reading
While non-lawyers may not have heard of the term “spoliation,” most people intuitively know that destroying evidence related to an ongoing litigation is a bad thing to do. Conversely, even many lawyers do not know the breadth of a company’s obligation to preserve evidence, particularly electronically stored information (which is quaintly referred to as “ESI”). Further, knowing the basics of this obligation is critical because failing to preserve ESI can lead to monetary penalties, affirmative claims being dismissed and/or defenses being barred.
Perhaps the most common misconception about the obligation to preserve ESI is that a company runs no risk of punishment for having destroyed ESI pursuant to a document retention/destruction policy, as long as such policy (i) is objectively reasonable and (ii) was implemented at a time when no litigation could have been anticipated. Further, at first glance, Rule 37(e) of the Federal Rules of Civil Procedure would appear to support this notion:
Absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system.
While this rule seems simple enough, the … Keep reading