LJN Newsletters

A franchisor has rights and remedies that a secured creditor is not granted under the UCC, but the franchisor, by becoming a competing secured creditor, does not necessarily advance its rights and remedies in a default situation. The inter-creditor agreement and remarketing agreement are alternatives to maximize recoveries and reduce conflicts by cooperation, rather than by litigation.

The 21st century is clearly the age of cybercrime, and franchise companies should be especially concerned because, simplistically, there are only two types of computer systems: those that have been hacked, and those that will be hacked.

Recent rulings of interest to you and your practice.

National cases of importance.

In a profit- and loss-driven world, there is always a risk that companies facing an uncertain economic future may choose to cut compliance expenses," SEC Chairman Christopher Cox noted last November at the SEC's Compliance Officer Outreach National Seminar. Then he issued a stern warning: "When a company cuts compliance, violations will occur. And if violations occur, punitive actions should and will be taken."

In this heightened enforcement environment, it is more important than ever that corporate general counsel be ready and able to navigate a minefield of complex issues as soon as they become aware that their company is the focus of a government investigation.

In January, the Second Circuit affirmed the conviction of Ionia Management S.A. (Ionia) for criminal acts of its non-management employees. While the affirmance of a conviction is commonplace, what set this appeal apart is that the Association of Corporate Counsel, the Chamber of Commerce of the United States of America, and other prestigious amici supported Ionia's argument that the Second Circuit should revisit its long-standing rule that a company can be held criminally liable for acts of even low-level employees.

Who's doing what; who's going where.