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The Federal Trade Commission's (FTC) long-awaited Staff Report recommends the retention of an important advancement for the benefit of prospective franchisees: the mandated disclosure of trademark-specific franchisee associations in Item 20. Many franchisee advocates viewed this provision in the October 1999 Notice of Proposed Rulemaking (NPR) as a laudable recognition of the legitimate and constructive role that franchisee associations can and do play in our industry, including as an unfiltered source of information for prospective franchisees.

On Aug. 25, 2004, the Federal Trade Commission (FTC) released its long-anticipated report on its proposed changes to the FTC Rule on Franchising and Business Opportunity Ventures (FTC Rule). When the new FTC Rule comes into effect, franchisors will have to make significant changes to their existing disclosure documents and follow new rules for how and when they are delivered to prospective franchisees. There are also new exemptions for large transactions and large franchisees, and the FTC Rule will not apply to international franchise locations.

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How do venture investors compare investments in portfolio companies when the amounts invested, the timing of those investments, the returns, and the timing…

On March 16, 2004, the Securities and Exchange Commission issued final rules amending Form 8-K to increase significantly the number of events that trigger the requirement to file and shorten the deadline for filing. The new rules became effective on Aug. 23, 2004 and significantly expand the filing and disclosure requirements applicable to public companies with respect to mergers and acquisitions and other material transactions. The rules are another in a long series of measures adopted by the SEC pursuant to the Sarbanes-Oxley Act of 2002 and are intended to improve the dissemination of information regarding public companies to investors in a timely manner.

How many actors does it take to infringe a patent? At least in the case of a U.S. patent, the answer is "One — and only one." This question is more than just a not especially amusing riddle. Rather, it calls attention to an issue that is likely to assume much greater importance in coming years: the need, as a prerequisite to showing infringement of a U.S. patent, to identify a single legal "actor" to whom each and every of the infringing elements of an accused system or process may be attributed.

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The Federal Circuit Court of Appeals has just issued an opinion that changes precedent in U.S. patent law, namely, <i>Knorr-Bremse Systeme Fuer Nutzfahrzeuge GMBH v. Haldex,</i> __ F.3d __ (Fed. Cir. 2004). Previously, for a company that was accused of patent infringement, the general law was that the company had "an affirmative duty to exercise due care" to avoid infringement, including "the duty to obtain competent legal advice from counsel before initiation of any possible infringing activity." <i>Underwater Devices, Inc. v. Morrison-Knudsen Co.,</i> 717 F.2d 1380, 1389-90 (Fed. Cir. 1983). Failure to obtain such legal advice was considered a key factor in determining whether infringement is willful. A finding of willful infringement can be devastating, as it can subject a defendant to enhanced damages (up to three times actual damages) and/or the payment of the plaintiff's attorneys' fees. 35 U.S.C. &sect;&sect;284 and 285.

Your client has an invention. He tells you he came up with the invention 18 months ago and that he hasn't offered the invention for sale and hasn't publicly disclosed it. He's meeting with you today because he has evaluated his prototype and finally decided to direct financial resources toward obtaining a patent. He asks you to prepare a patent application. Everything seems fine, right? Maybe not. A bar date might have been purchased along with the prototype.

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In Part One of this article, we examined the risks to intellectual property (IP) value that would most preoccupy IP professionals, including: third-party risks for infringement liability, first-party risks to IP assets, and Directors &amp; Officers (D&amp;O) risks arising out of relevant valuation and disclosure. However, as IP specifically accounts for a higher ratio of market capitalization and shareholder value for publicly traded corporations, strategic choices relating to IP impact the firm's financial fortunes in more subtle ways, commensurate with that increased value. To cite one salient example: For IP-rich companies, tax planning is increasingly intertwined with Intellectual Asset Management (IAM) strategy.