Parties to commercial/business transactions are no doubt familiar with “term sheets”, “letters of intent”, “memoranda of understanding” and “agreements in principle”. As the parties to these documents know, they outline the fundamental terms of the transaction being negotiated. Terms sheets and the like have a number of advantages: they can be drafted without the expense of hiring a lawyer; they reduce later renegotiation and lapses in memory; they can facilitate discussions

What is a forum selection clause? Corporations and other business entities are all too familiar with them. In its simplest form, a forum selection clause is a provision in a contract that designates a specific location (or a particular court within a specific location) for litigation in the event of a dispute. Forum selection clauses are common in commercial contracts because they “provide certainty and predictability in the resolution of disputes.” Boss v. American Express

A breach of contract comes in two primary varieties: a material breach and a minor breach. The former is substantial, goes to the very heart of the agreement and prevents the contract from being performed. When a material breach occurs, the non-breaching party can cease performing under the agreement and sue to collect the damages caused by the breach. The latter, also known as a partial breach, occurs when a party fails to complete a less important part of a contract. Impo

Business owners hate litigation. In fact, there are few things they hate more. Litigation damages relationships, tarnishes reputations, and interferes with business operations. Even small claims divert time, money and talent. So, how can corporations and small businesses avoid these costs and expenses? The answer: alternative dispute resolution, such as arbitration and mediation. Over the past few decades, it has become commonplace for corporations and small businesses to i

Your client comes to you with a complaint that was recently served on him. Among other claims, the plaintiff contends that your client breached his agreement to sell widgets. After discussing the claims with your client, you decide to file an answer. Your analysis of the contract claim leads you to conclude that the contract is void because performance would require your client to violate certain labor laws. In addition to general denials, you assert several affirmative defe

From time to time, this Blog has written about lawsuits involving corporations, including those brought as shareholder derivative actions ( here ). As this Blog explained, a derivative action is a lawsuit brought by a shareholder of a company, on behalf, and for the benefit, of the company to enforce or defend a legal right or claim. Derivative actions seek the recovery of damages and/or equitable relief arising from unlawful or improper conduct engaged in by officers, direct

What could this legislation mean for New York businesses? New York Attorney General Eric T. Schneiderman recently introduced legislation intended to reduce the use of non-compete agreements in the workplace. The bill is designed to protect the rights of workers to find better employment opportunities, particularly for low-wage earners who have been hindered in their ability to move to new jobs because of non-compete agreements. Schneiderman’s bill includes: A ban on all non

We live in a technologically advanced world. Our phones are smart, our tablets are mini-computers, and our laptops/notebooks are more powerful than ever. We can interact with each other through email, text messaging and other forms of electronic communications. Gone, for the most part, are the more formal, traditional ways of communicating with each other, e.g. , letters and faxes. As the modern ways of communicating have become the norm, many business executives and owner

Let’s say you, the reader, are an entrepreneur who wants to open a business. Although you are willing to run the risks associated with a startup, you do not want to incur any personal liability for the acts done by the business. After speaking with your family, friends and neighbors, you decide to incorporate the business. The consensus view is that a corporate entity, such as a corporation or limited liability corporation (“LLC”), will enable you to operate the business and

Bryan Reichel, founder of PureChoice -- deceptive or duped? Business lawsuits involving accusations of fraud can be complicated and confusing. It is sometimes difficult to decipher who is lying and who is telling the truth. On the one hand, there is a successful CEO, who is alleged to have committed fraud to develop or maintain a lavish lifestyle. While, on the other hand, there is an accuser who stands to gain money and power by overthrowing the existing kingpin. If you fin

What is behind the lawsuit accusing Hitachi of Stealing Trade Secrets from Purolite? At the end of August, Purolite, an American water treatment company based in Pennsylvania, filed a lawsuit against the American branch of Japanese conglomerate Hitachi. According to Purolite, Hitachi violated the stipulations of a business agreement by sharing Purolite's confidential trade secrets concerning the decontamination of water, including water contaminated by radioactive waste. Pur

Practitioners involved in qui tam litigation often encounter questions concerning when the statute of limitations begins to run. Under the False Claims Act (“FCA”), the government (or relator) must file a suit not “more than 3 years after the date when facts material to the right of action are known or reasonably should have been known by the official of the United States charged with responsibility to act in the circumstances, but in no event more than 10 years after the da

By Jeffrey M. Haber What anticompetitive business actions are considered unfair? Amidst the recent commotion surrounding the wildly elevated prices of certain products sold by Mylan Pharmaceuticals ("Mylan"), New York State Attorney General Eric Schneiderman is investigating whether the drug company has unfairly limited competition. Although Mylan has been accused of profiteering before, this time the product involved is EpiPen®, the emergency injector used for extreme emerge

By Jeffrey M. Haber, a partner at Freiberger Haber LLP On May 31, 2016, the Appellate Division, First Department, issued MP Cool Investments Ltd. v. Forkosh, 2016 NY Slip Op. 05944, a case involving allegations of fraud in connection with the production and sale of a commercial heating and ventilation system by an Israeli-based company. In the decision, the First Department unanimously affirmed the motion court’s dismissal of the plaintiff’s fraud claims because they were not

When parties negotiate the terms of a contract, they cannot account for every contingency or event that may affect performance. To be sure, they try. But, it is simply not possible to account for every occurrence that might arise during the course of the contract. This inability, therefore, gives the parties wide latitude in the performance and enforcement of their contractual obligations. Underlying this discretion is the duty to act in good faith and with fair dealing.

By Jeffrey M. Haber An agency relationship occurs when a principal gives legal authority to an agent to act on the principal’s behalf when dealing with a third party, and obtains the agent’s consent to be subject to the principal’s control. See Restatement (Third) of Agency §1.01. An agency relationship is a fiduciary one, meaning the agent, acting within the scope of his/her authority, has to act in the best interests of the principal. Under such circumstances, the acts an

By: Jeffrey M. Haber After a merger, which agreement controls when both companies have pre-existing contracts with a common third party? In May 2016, Stamford-based Charter Communications Inc. (“Charter”) completed its acquisition of Time Warner Cable (“TWC”), making it the second largest cable provider behind Comcast Corporation. At the time of the acquisition, TWC was the larger of the two companies. As such, TWC was able to negotiate more favorable rates and terms on ca

By Jeffrey M. Haber In today’s digital world, it is not uncommon for individuals and businesses to memorialize the terms of their oral agreements through email. But are such agreements enforceable? The answer depends on a couple of factors, including whether there is a writing that memorializes the material terms of the agreement. Oral agreements that cannot be performed within one year of the agreement must be in writing. This broad rule, contained in the statute of frauds,

By: Jeffrey M. Haber Is it a breach of contract to bypass an agreed-upon, independent alternative dispute resolution (“ADR”) process and commence an arbitration proceeding elsewhere? When two companies enter into a contract, it’s common to include language wherein both parties consent to having any disputes related to the contract decided by an agreed-upon, neutral third party, rather than by a judge in a lengthy, formal court proceeding. The process of ADR-- which may be by

By: Jeffrey M. Haber Damages Or Rescission . . . It Makes A Difference. Most people think that they are entitled only to monetary relief when they are the victim of fraud. That, however, is not always the case. Sometimes rescission – that is, returning to the status quo ante – is the appropriate form of relief. Indeed, there are times when a victim of fraud would rather be in the position he/she was in before the fraud occurred. When that happens, can the victim of fraud