When Trade Vendor Priority Claims Get Paid
March 26, 2007
The U.S. Bankruptcy Court for the Eastern District of Pennsylvania recently issued one of the first decisions in the 3rd U.S. Circuit Court of Appeals to interpret ' 503(b)(9), an important new Bankruptcy Code provision passed under the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA): <i>In re Bookbinders' Restaurant Inc.</i> ' 503(b)(9) is certain to impact the relationship between a debtor seeking to reorganize and the trade vendors that deal with it.
Exchange-Traded Solvency Derivatives
March 26, 2007
In the last ten years, the credit derivatives market has grown from its infancy to approximately $26 trillion of notional value according to the International Swaps and Derivatives Association, Inc. ('ISDA'). The most highly utilized type of credit derivative, the credit default swap, is used by investors to bet on a company's creditworthiness or hedge a position in a fashion that protects against the company's failure to make a payment or satisfy other terms.
Wage Hour Laws Provide Traps for the Unwary
March 26, 2007
It has often been said that the most frequently violated federal employment-related statute is the Fair Labor Standards Act ('FLSA'), 29 U.S.C. '' 201-19 (Supp. 2006). This law, enacted in 1938, regulates, among other things, the payment of overtime to employees who work for employers. Our experience indicates that most, if not all, employers do not intend to violate the provisions contained in the FLSA but, instead, do so out of ignorance of its requirements. This article highlights some of the key provisions of the FLSA, makes reference to recent pronouncements by the United States Department of Labor (the federal agency principally responsible for interpretation of the statute) and presents advice on how to avoid the pitfalls inherent in the FLSA.
Paddling Down Esopus Creek
March 26, 2007
An end-of-year (Nov. 29) Delaware Chancery Court decision, <i>Esopus Creek Value LP v. Hauf</i>, No. 2487-N (Del. Ch. Nov. 29, 2006), is receiving a great deal of attention from corporate transactional and corporate restructuring attorneys alike. In <i>Esopus</i>, the Delaware Chancery Court prevented a financially sound company that was prohibited by federal securities law from holding a shareholder vote, because it failed to meet its reporting requirements, from executing an agreement outside of bankruptcy to sell substantially all of its assets under Section 363 of the Bankruptcy Code without first obtaining common stockholder approval as required under Section 271(a) of the Delaware General Company Law ('DGCL').
Enforcement Under State Security Breach Notification Laws
March 26, 2007
Thirty-four states have enacted security breach notification laws. And Michigan passed such a law with an effective date of July 2, 2007. These laws cover the notification that a company must make in the event of a breach of security of its system with respect to computerized personal information. How are these laws enforced in the event of a violation? These laws vary in terms of enforcement and penalties, as more particularly described below. This article provides an overview of the enforcement of these laws and describes examples of penalties.
Document Discovery
March 26, 2007
In today's litigation world, corporate counsel struggle to contain the ever-increasing costs of document discovery. The explosion of electronically stored information ('ESI') is often a huge contributor to the expense of discovery. Consultants, vendors, and e-discovery software can help bring greater efficiencies and cost-savings to the process. But while there is a dizzying array of options available, they are not all created equal. Finding the right solution requires that you do your homework.
Attacking the Root of the Punitive Damages Problem
March 26, 2007
On Feb. 20, 2007, the U.S. Supreme Court issued a landmark decision on punitive damages in <i>Philip Morris USA v. Williams</i>, when it found a jury's $79.5 million punitive damage award, assessed in conjunction with $821,000 in compensatory damages for negligence and deceit in misleading a smoker to believe that smoking was safe, was unconstitutional. Instead of reducing yet another runaway punitive damage award, the 5 to 4 majority of the Court attacked the root of the problem: unfair punitive damages trial procedures. This decision may indicate that the Court, operating under Chief Justice Roberts, is considerably more aggressive in protecting the constitutional rights of punitive damage defendants than was the Rehnquist Court.
<b><i>Online Exclusive:</b></i> Internet Porn Law Ruled Unconstitutional
March 23, 2007
Congress suffered yet another setback on March 22 in its ongoing efforts to shield children from sexually explicit content on the Internet when a federal judge struck down the Child Online Protection Act, a 1998 federal law that makes it a crime for commercial Web site operators to allow children access to "harmful" material.
COPA Struck Down By Federal Judge
March 22, 2007
A federal judge sitting in Philadelphia has struck down the 1998 Child Online Protection Act ('COPA') on March 22. The Act was challenged as unconstitutionally vague by health Web sites and the American Civil Liberties Union ('ACLU').
