From the category archives:

Finance Dept

Patent-infringement warranties should be negotiated very cautiously

October 17, 2009

A patent-infringement warranty in a contract can be a decidedly non-trivial matter, because: You can infringe a patent * without knowing it, indeed without even knowing that the patent exists; You can infringe a patent that didn’t exist when you did your product-design work — that can happen if the patent application was still pending when [...]

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Amazon.com drops marketing affiliates in NC, RI to avoid having to collect sales tax – good thing they had a termination-at-will clause in their contract

June 30, 2009

Amazon.com is dropping its online marketing affiliates in North Carolina and Rhode Island.  It did so to avoid having to deal with recent sales-tax legislation in Rhode Island and North Carolina. These bills would require Amazon and other companies to collect sales tax for in-state sales if they had any online marketing affiliates in the [...]

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Foreign encryption-possession restrictions may catch travelers carrying laptops or smartphones

June 24, 2009

Pillsbury Winthrop lawyer Sanjay Jose Mullick writes about laws restricting the possession of encryption technology, and the surprising possible consequences if those laws were to trap a traveler carrying a laptop computer or a smartphone such as the Blackberry or iPhone.

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Quicken, TurboTax maker signs $120 million patent license agreement with leading ‘non-practicing entity’

June 24, 2009

Intuit, maker of Quicken and TurboTax, has apparently signed a patent license agreement, which it estimates as being worth $120 million over ten years, with Intellectual Ventures, a leading ‘non-practicing entity.’ (Some call Intellectual Ventures a ‘patent troll‘; the company’s home page speaks in terms of its “Invention Capital™ network”). For more details and commentary by [...]

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Forget short contracts – focus instead on short clauses

June 19, 2009

“Wow, this is a long contract!” Most lawyers have heard this from clients or counterparties. True, sometimes contracts run too long because of overlawyering, where the drafter(s) try to cover every conceivable issue. But too close a focus on contract length may obscure the more-important issue: contract readability. This isn’t just a question of aesthetic [...]

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An oral understanding might not get you off the hook for a written contractual obligation

April 1, 2008

You have to wonder whether to feel sorry for the loan broker in Wheeler vs. Blumling. This broker found a business loan for a customer, and then went along with the lender’s insistence that the broker himself sign a guaranty. Unfortunately, things went badly awry (including the indictment of one of the borrower’s business associates [...]

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One poisoned water bottle: Paul O’Neill explains the subprime mortgage crisis

March 28, 2008

From the March 30 NY Times Magazine’s interview with Paul O’Neill, former secretary of the Treasury: [NYT:] It’s so hard to understand how the subprime mortgage crisis has triggered a financial crisis of global proportions. [Paul O'Neill:] If you have 10 bottles of water, and one bottle had poison in it, and you didn’t know [...]

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Adelphia Vendors Motorola, Scientific-Atlanta Implicated in Executives’ Securites-Fraud Trial

June 9, 2004

Today’s WSJ ($) reports that, in the trial of two former Adelphia executives, an email and witness testimony have implicated Adelphia vendors Motorola and Scientific-Atlanta as “allegedly help[ing] Adelphia cook its books.”

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After-the-Fact Contract Changes, Side Letter, Lead to Federal Fraud Indictments

June 4, 2004

The Department of Justice recently announced that several former Enterasys executives had been indicted for securities fraud and wire fraud. According to the Justice Department, the accused executives altered an already-signed contract to change its terms — after the close of the quarter — so that revenue could be recognized in the quarter. One of [...]

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Good News — I Guess

June 3, 2004

The Associated Press reports that today the U.S. Attorney’s office announced criminal indictments against seven former employees of Symbol Technologies for securities fraud. Symbol’s home page announced, “No Criminal Complaint Filed Against Symbol.” Imagine being a customer and seeing that on a vendor’s home page. (The Symbol home-page item is linked to this press release.)

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SEC Hammers Company’s Customers for Securities-Fraud Participation

January 7, 2004

The SEC has again gone after customers of a company for allegedly helping to perpetrate the company’s securities fraud by “round-tripping,” i.e., creating fictitious transactions that were reported as revenue. As part of the settlement, the customers’ principals, as well as the company insiders who were involved, were barred from serving as an officer or [...]

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