It is widely accepted that the value of most companies today lies primarily in their confidential business and technical information and other intangible assets and when such assets are stolen it is almost always by employees and business partners, not unknown third parties. Yet, many companies continue to make minimal efforts to protect such assets through proper non-disclosure agreements (“NDAs”), disclosing secrets without requiring a signed NDA, relying on the same poorly-drafted NDA in all cases, or failing to follow through to ensure agreements are properly signed and filed.
Admittedly, NDAs can’t provide perfect protection. Litigation is costly, burdensome and uncertain, and companies often prefer to remain silent about embarrassing leaks of trade secrets. Consequently, the first line of defense should always be sound security precautions, such as locked doors, limited access, logbooks, security cameras, encryption, monitoring, and the like. However, in the event of a leak, the company that regularly requires signed, well-drafted NDAs is far more likely to achieve a favorable outcome than one that does not.
Wearable-device maker, Jawbone, learned that last month when the San Francisco Superior Court granted its request for an injunction against several former employees accused of loading thousands of confidential files onto thumb drives and e-mailing them to personal e-mails, before quitting their employment and going to work for Fitbit, Jawbone’s competitor. The court found the employees breached the confidentiality provisions in their employment contracts and ordered them to return all of the files. So far at least 18,000 files have been returned. The case is typical and is probably far from over, but certainly Jawbone is far better off due to the contractual obligations it imposed on its employers.
To ensure good results like that, below are some best practices to keep in mind when drafting NDAs. Continue reading
The first time I testified in court in Taiwan, I spoke English and the judge translated simultaneously for the attorneys and clerks. After fifteen years here, I speak enough Chinese to direct taxi drivers, but not enough to discuss complex licensing negotiations. Fortunately, our judge earned her law degree in the U.S., is fluent in English and was kind enough to help out.
The second time was different. The judge gave no indication that he spoke English, so the opposing witness and I each brought an interpreter. My interpreter regularly handles Taiwan legal proceedings and rode the subway twenty minutes to get to the hearing, as did I, while our adversary flew a lawyer, translator and witness from London, with the corresponding costs of airfare, hotel, meals and time.
Of course, that was why we sued them in Taiwan. Well, that and the fact that our adversary would be forced to try the case in Chinese, struggling with jet lag, unfamiliar procedures and potential bias, while my client would be comfortably on home turf, using native language, avoiding the hassles and costs of U.S. litigation. But I suppose I should start at the beginning. Continue reading
Global commerce often leads to litigation and the need to obtain evidence from foreign parties and witnesses. However, in most Asian (and other civil law) countries, discovery is conducted by judges, not attorneys, depositions and other formal discovery procedures do not exist, and attempts by foreign litigants to gather evidence contrary to local laws may be seen as violations of national sovereignty, for which criminal sanctions may be assessed.
Fortunately, lawful methods exist for U.S. litigants to depose parties and non-parties in most countries. Primarily, the Federal Rules of Civil Procedure (“FRCP”) and corresponding state laws authorize the taking of foreign depositions pursuant to (a) treaty or convention, (b) letters of request or letters rogatory, (c) deposition notice, or (d) before a consular officer; and the Hague Convention on Taking of Evidence Abroad authorizes depositions before a consular officer or pursuant to letters rogatory.
However, each of those options has flaws. Singapore and South Korea are parties to the Hague Convention, but Japan, Taiwan, Thailand, Malaysia and the Philippines are not. China is a party to the Convention, but strictly prohibits depositions. The letters rogatory process takes many months and results in not a real deposition, but only the submission of written questions for a judge to convey to the deponent. A deposition notice is useless against a non-party witness who refuses to comply. And taking depositions before a consular officer is troublesome, as reservations must be made long in advance and one cannot bring cell-phones and laptops into embassies or consular offices.
In short, plenty of depositions take place in Asia, but there are myriad legal and practical complications, so it is critical that U.S. counsel plan well in advance, informing the presiding judge of the plans, consulting with foreign counsel, and carefully observing best practices concerning the following matters, to ensure that the process will succeed and testimony will be admissible in court. Continue reading
As Legal Director at a multi-billion dollar tech company, I spent several years retaining and managing outside counsel to assist with global litigation, transactions and other matters, striving to satisfy the seemingly insatiable demands of upper-management. Cost-reduction was our corporate mantra, with every matter closely scrutinized and every fee seen as too high.
While I was fortunate to work with many outstanding attorneys from around the world, I found that counsel often excel in a particular area of expertise, but fail to look after the best interests of their client. Sound management of counsel is therefore critical. Below are ten lessons that I learned. Continue reading
Recently, I was honored to be interviewed by Forbes Magazine concerning illegal price-fixing and collusion in Taiwan. In case you missed it, here’s the full interview: Continue reading
It’s no secret, most intellectual property licensees under-report royalties, often by a large margin. According to one study, 89% of all licensees under-report, with one-fourth short-changing licensors by more than 100%.
Fortunately, licensors can increase the odds of recovering the royalties they bargained for — rather than allowing their licensees to unilaterally name their price — by drafting key licensing provisions with care and strategically monitoring and auditing of licensees.
The below article lays out a few of those best practices to be employed by prudent licensors. Continue reading
On January 23, 2015, at Soochow University, Taipei, Taiwan, I was proud to deliver a presentation on “Developing and Implementing an Effective Antitrust Compliance Program,” as one of several speakers discussing “Best Practices for Avoiding and Resolving Global Antitrust Investigations and Litigation,” sponsored by the Taiwan Technology Industry Legal Officers Association (TILO).
HERE is the handout for my presentation and below are a few photos from the event. Continue reading
Corporate bribery is in the headlines. Last week, the media was reporting accusations that Hong Kong’s top government official took $6.4 million in bribes from an Australian engineering firm. Before that, a top official in China’s central planning commission admitted taking $5.8 million in bribes from Toyota and other companies, and a Chinese court fined GlaxoSmithKline (“GSK”) $500 million for bribing doctors. Before that, Alcoa settled bribery charges in the U.S. for $380 million, while Hewlett-Packard settled charges for $108 million.
Each time, the news is followed by a flurry of articles from corporate compliance experts urging companies to take ethics and compliance more seriously, including obtaining full support of the CEO and Board, assigning oversight responsibility to high-level personnel, allocating resources, implementing policies and procedures, providing regular education and training, incentives and discipline, performing continuous auditing, monitoring and fine-tuning, and responding promptly to any violations.
Some may feel that’s a bit much, that, “Our company values ethics and integrity, but can’t afford a full-blown compliance program.” In truth, most global companies can’t afford not to implement such measures, and it’s not just about bribery. Below are some reasons why companies should honestly assess their compliance programs and make earnest efforts to plug any gaps. Continue reading
Patent law and antitrust law have long had an uneasy relationship. A patent is a legal monopoly, but antitrust law favors market competition and abhors monopolies. Consequently, U.S. courts have struggled for over a century to define reasonable boundaries between the two disciplines.
In the U.S., the Sherman Antitrust Act is at the core of most antitrust litigation. In the early years of the Act, patents were seen as almost immune from its reach, with the Supreme Court stating a general rule of, “absolute freedom in the use or sale of rights under the patent laws. . . The very object of these laws is monopoly.” E. Bennett & Sons v. National Harrow Co., 186 U.S. 70 (1902). But laws evolve and today courts usually apply a “rule of reason” approach when evaluating whether conduct unreasonably restrains competition, with the Supreme Court declaring “patent and antitrust policies are both relevant.” FTC v. Actavis, 570 U.S. 756 (2013).
Globalization further complicates matters. While a patent basically confers rights only within the country in which it is granted and the doctrine of comity disfavors interfering in the affairs of other nations, global manufacturing and sourcing of components, “is increasingly common in our modern global economy, and antitrust law has long recognized that anticompetitive injuries can be transmitted through multi-layered supply chains.” Lotes Co., Ltd. v. Hon Hai Precision Industry Co., Ltd., No. 13-2280 (2d Cir. 2014).
However, the test for application of the Sherman Act to foreign parties and foreign conduct has become increasingly clear, in particular with several U.S. cases decided earlier this year, one of which involved allegations of egregious patent licensing conduct in China. Continue reading