PCT Law Group Blog

DC Federal Court Rejects Employee Challenge to Arbitration Agreement

Fri, 26 Apr 2013 04:00:00 GMT

An employee who claimed an agreement he entered to arbitrate all employment related claims was unconscionable has his challenged rejected as the Court found the arbitration agreement to be neither procedurally or substantively unconscionable.

In the case of Fox v. Computer World Services Corp., et al. (2013), when Plaintiff Phillip Fox (“Fox”) began his employment with Computer World Services Corp. and C2 Essential, Inc. (joint employers of Fox and collectively referred to as “Defendants”) he electronically signed a number of forms, one of which was an arbitration agreement. The arbitration agreement provided that the parties agreed to arbitrate, inter alia, any claims alleging violation of federal and state statutes. Approximately eighteen months after he began working for Defendants, Fox’ employment was terminated. Fox alleged that his job termination was in violation of the Age Discrimination in Employment Act, and also alleged retaliation and violations of the District of Columbia Human Rights Act. Fox refused to arbitrate his claims and instead sued Defendants in state court. Defendants removed the case to federal court and also filed a motion to dismiss and to compel arbitration.

For his part, Fox challenged the arbitration agreement and claimed it was procedurally unconscionable because it was buried within a larger series of employment documents; it was presented to him on a take it or leave it basis; and, he did not understand that by acknowledging the arbitration agreement he was agreeing to the terms within the agreement. Fox also challenged the agreement because he signed it electronically. The Court rejected each of these arguments and found that the Agreement to Arbitrate was presented in a separate document and the title of the document was in all caps and in bold font. In addition, the Court found that immediately before the signature line of the agreement was an acknowledgement, again in all caps, which stated that the signatory read and understood the terms of the agreement and was been provided the opportunity to discuss the agreement with legal counsel. Finding that Fox had a choice as to whether to enter the agreement, acknowledged that he read and understood the agreement and was given a chance to consult legal counsel, the Court found the arbitration agreement was not procedurally unconscionable.

Fox also raised a number of substantive challenges to the arbitration agreement, including challenging the agreement on the grounds that it contained a fee-sharing provision wherein all parties were required to share the fees and costs of the arbitrator in an amount and manner determined by the arbitrator. While the Court easily disposed of most of Fox’ substantive challenges to the arbitration agreement, the fee- sharing issue raised by Fox and whether forcing him to go through arbitration would be prohibitively expensive was not so easily resolved. Ultimately, the Court found that the risk that Fox might incur prohibitive costs was too speculative to invalidate the agreement. The Court relied on the fact that Defendants had waived the fee-sharing provision in the agreement, and that the agreement (although somewhat ambiguous) appeared to allow the arbitrator discretion as to how to allocate fees and costs. Therefore, Fox’ argument as to what portion of those fees he would have to bear were too speculative to deem the arbitration agreement substantively unconscionable. The Court held that the arbitration agreement was enforceable and compelled Fox to arbitrate his claims.

Written By Malik K. Cutlar

Maryland Highest Court Determines Proper Calculation of Lost Profits in Contract Case

Thu, 25 Apr 2013 04:00:00 GMT

Since the amount of damages sought on a lost profits claim can be substantial, any variations in the standard will likely have a drastic impact on the recovery. The Maryland Court of Appeals (the highest court in the state) in CR-RSC Tower I, LLC v. RSC Tower I, LLC recently addressed the issue of whether the trial court properly excluded post-breach market conditions to mitigate consequential lost profits in a jury trial which resulted in an award of $36 Million in damages.

The landlord defendants in CR-RSC Tower I, LLC deliberately breached a real estate agreement causing plaintiff developer’s financing to fall through. The developer sued for breach of contract and sought recovery of lost profits basing its market projections at the time of the breach. The landlords did not dispute the breach, but countered that the current market conditions were relevant and necessary to meet the requirement that lost profits be proven with “reasonable certainty.” The landlords sought to offer the testimony of an expert to show that the developer would not have suffered any damages given the subsequent downturn in the real estate market.

The Court explained that the contract in this case did not address or allocate the possibility of future market downturns. The only evidence established that, at the time the parties entered into the agreement, the parties contemplated a relatively stable market and did not foresee the cataclysmic crash of real estate. Thus, evidence of post-breach booms or even busts was not relevant to the determination of the expected value of performance as of the time of breach. As a result, the Court upheld the trial court’s exclusion of the defendants’ evidence of “post-breach market conditions.”

Written By Angela H. France

Fourth Circuit Substantially Reduces Jurys Emotional Damages Award

Wed, 24 Apr 2013 04:00:00 GMT

Please see, Angela France's article featured within Virginia Business Law Update.

http://www.virginiabusinesslawupdate.com/2013/04/articles/employment-law-1/fourth-circuit-substantially-reduces-jurys-emotional-damages-award/

Written By Angela H. France

US Citizenship and Immigration Services Releases New & Revised Federal I-9 Form

Wed, 24 Apr 2013 04:00:00 GMT

Please see, Angela France's article featured within Virginia Business Law Update.

http://www.virginiabusinesslawupdate.com/2013/04/articles/small-business-1/us-citizenship-and-immigration-services-releases-new-revised-federal-i9-form/

Written By Angela H. France

Government Contractor Teaming Agreement Ruled Unenforceable

Mon, 22 Apr 2013 04:00:00 GMT

Please see, Malik Cutlar's article featured within Virginia Business Law Update.

http://www.virginiabusinesslawupdate.com/2013/04/articles/government-contracting/government-contractor-teaming-agreement-ruled-unenforceable/

Written By Malik K. Cutlar

Use of Misappropriated Trade Secret Not Required For a Trade Secrets Act Violation

Tue, 16 Apr 2013 04:00:00 GMT

If an employee misappropriates their current or former employer’s proprietary information, and discloses such information to its new employer and/or any other unauthorized person(s), that is enough to establish a violation under the Virginia Uniform Trade Secrets Act (“VUTSA”) so says the Virginia Supreme Court. There is no requirement under the Act that the employee or new employer actually use the misappropriated information to compete with the former employer.

In the case of Geographic Services, Inc. v. Collelo, et al. (2012), the Virginia Supreme Court held that once an employer establishes the existence of a trade secret, all that they are then required to show is that the trade secret was misappropriated as that term is defined under the Trade Secrets Act. The entity from which the trade secret was misappropriated does not have to show that defendants used the trade secret in order to establish a claim under the VUTSA and recover damages. Disclosure of the trade secret is sufficient where it can be shown that the new employer and/or person to whom the trade secret was disclosed knew, or had reason to know, that the trade secret was acquired by improper means. In such cases, where the plaintiff cannot readily prove measurable damages, then the VUTSA provides that the court can impose a reasonable royalty upon the wrongdoers for the unauthorized disclosure of the trade secret.

This decision by Virginia’s highest court provides a cautionary note for Virginia employers: if you know, or should have known, that an employee has obtained proprietary information from its prior employer without its knowledge, you could be on the hook for damages if the employee discloses the information to your company – even if your company never uses the information. The disclosure, in and of itself, will be enough to expose companies to monetary damages. Conversely, companies in which an employee has taken proprietary information can seek legal redress and possibly obtain damages even if the employee and its new company did not use the information.

Written By Malik K. Cutlar

Trademark Licensing Agreement Foreclosed Naked Licensing Defense

Tue, 16 Apr 2013 04:00:00 GMT

Please see, Angela France's article featured within Virginia Business Law Update.

http://www.virginiabusinesslawupdate.com/2013/04/articles/intellectual-property/trademark-licensing-agreement-foreclosed-naked-licensing-defense/

Written By Angela H. France

Angela France Honored as Rising Star by Virginia Super Lawyers and Washington DC Super Lawyers for 2013

Tue, 16 Apr 2013 04:00:00 GMT

PCT Law Group, PLLC is pleased to announce that Angela France has been recognized by her peers as a Rising Star by Virginia Super Lawyers and Washington, D.C. Super Lawyers. The process consists of nominations from lawyers of the best attorneys who are 40 or under, or who have been practicing for 10 years or less. They are instructed to nominate lawyers they have personally observed in action — whether as opposing counsel or co-counsel, or through other firsthand courtroom observation. In addition to the general survey, the research team reviews the credentials of potential candidates. No more than 2.5 percent of the lawyers in the state are named to the list.

This marks the fourth time Ms. France, a commercial litigator based in PCT's Alexandria office, has been honored as a Super Lawyer Rising Star for Virginia. She received her law degree in 2001 from George Mason University School of Law.

Written By Sabah Azim

Contracts 101: Covenants, Representations and Warranties in IP License Agreements

Fri, 05 Apr 2013 04:00:00 GMT

Please see, firm partner, Raymond Millien's article featured within IP WatchDog.

http://www.ipwatchdog.com/2013/04/05/contracts-101-covenants-representations-and-warranties-in-ip-license-agreements/id=38621/

Written by Raymond Millien

Faulty EEOC Charge Leads to Dismissal of Sex Discrimination and Retaliation Claims

Wed, 27 Mar 2013 04:00:00 GMT

An employee who alleged she was subjected to a sexually harassing work environment, gender discrimination, and retaliation under Title VII of the Civil Rights Act of 1964 (“Title VII”) filed a Charge with the Equal Employment Opportunity Commission (“EEOC”). However, almost all of the facts supporting the employee’s Charge were put in the EEOC intake questionnaire and letters to the EEOC, rather than in the EEOC Charge Form. As such, only the claims and facts set forth in the Charge were considered by the Court and they were insufficient to state the discrimination and retaliation claims raised by the employee.

In the case of Balas v. Huntington Ingalls Industries, Inc. (2013), the United States Fourth Circuit Court of Appeals affirmed a ruling from the Eastern District of Virginia that the Plaintiff, Karen Balas, could not maintain claims which were solely asserted in her EEOC questionnaire and in letters to the EEOC. The Court ruled that an administrative charge serves a vital function in the process of [potentially] remedying unlawful employment practices because it serves to alert the employer of the alleged wrongs committed; allows for an investigation into the alleged wrongful activity by the employer and the EEOC; and allows for the EEOC to seek conciliation between the parties if it finds merit to the charges. The Court reasoned that since a plaintiff’s employer is not put on notice as to the claims and facts alleged in the EEOC questionnaire or in letters privately written by a plaintiff to the EEOC, only those claims formally made part of the EEOC Charge were allowed to move forward in a lawsuit against an employer.

The Fourth Circuit concluded that the district court was correct in its refusal to consider any of Ms. Balas’ Title VII claims that were not included in her EEOC Charge; and that the Court had no jurisdiction to hear such claims because the Plaintiff had failed to administratively exhaust her remedies before filing such claims in federal court.

Written By Malik K. Cutlar

Competency Standards and Ethical Regulations for U.S. Intellectual Property Brokers and Other Middlemen

Fri, 22 Mar 2013 21:02:00 GMT

Please see, firm partner, Raymond Millien's article featured within IP WatchDog.

http://www.ipwatchdog.com/2013/03/22/competency-standards-and-ethical-regulations-for-u-s-intellectual-property-brokers-and-other-middlemen/id=37771/

Written by Raymond Millien

Bridging the Innovation Gap: Pro Bono Opportunities for Intellectual Property Attorneys

Tue, 26 Feb 2013 05:00:00 GMT

A few months ago, I posted a three-part series entitled The Real McCoy: Should Intellectual Property Rights be the New Civil Rights in America? In that article, I explained that, in the last thirty years or so, there has been a shift from a labor economy to a knowledge economy. Consequently, intangible assets (with intellectual property rights (IPR) being chief among them) have emerged as the most powerful asset class, overtaking more traditional capital assets such as real estate, plant and equipment. I then went on to define and point out that there is an “Innovation Gap” – disparities between classes of people, caused by societal hindrances, which prevent them from securing the IP rights necessary to economically exploit the fruits of their creativity. I then argued that given the existence of an innovation gap, and the fact that we are in an information age with another industrial revolution on the way, IPR should be the focus of a renewed civil rights movement. After all, the world’s natural resources may be shrinking, but the opportunities for there to be new candidates for IPR ownership are ever expanding!

I ended my three-part article by recommending that members of the IP Bar should strive to volunteer more pro bono hours in order to help bridge the innovation gap. Encouragingly, I received some emails from IPWatchdog.com readers asking, “how can I help?” Well, after some research, here is a list of some organizations around the country seeking patent, trademark and copyright pro bono attorney volunteers.

Alabama State Bar Volunteer Lawyers Program	Montgomery, AL
Arts & Business Council of Miami	Miami, FL
Association of Corporate Counsel: Austin Chapter	Austin, TX
Birmingham Bar Association Volunteer Lawyers Program	Birmingham, AL
City Bar Justice Center’s: Neighborhood Entrepreneur Law Project (NELP)	New York, NY
California Lawyers for the Arts	San Francisco, CA
Cannonball (formerly LegalArt)	Miami, FL
Colorado Lawyers for the Arts(COLA)	Denver, CO
Dallas Volunteer Attorney Program	Dallas, TX
Economic Development Pro Bono Project District of Columbia Bar	Washington, D.C.
Fed Circuit Bar Association, PTO Pro Bono Program	Washington, D.C.
Intellectual Property Law Section West Virginia State Bar	Charleston, WV
International Trademark Association	New York, NY
Lawyers Alliance for New York	New York, NY
Lawyers for the Creative Arts	Chicago, IL
Louisiana Volunteer Lawyers for the Arts	New Orleans, LA
Mobile County Bar Association Volunteer Lawyers Program	Mobile, AL
North Carolina Volunteer Lawyers for the Arts	Durham, NC
Ocean State Lawyers for the Arts	Saunderstown, RI
Philadelphia LawWorks	Philadelphia, PA
Philadelphia Volunteer Lawyers for the Arts	Philadelphia, PA
PILnet ProBono Clearing Houses	New York, NY
Pro Bono Clearinghouse Greater Richmond Bar	Richmond, VA
Pro Bono Project: Lawyers in the Library	San Jose, CA
ProBono Partnership	White Plains, NY
ProBoPat (Upcoming)	Denver, CO
Public Interest Intellectual Property Advisors (PIIPA)	Arlington, VA
Public Patent Foundation (PUBPAT)	New York, NY
Springboard for the Arts	St. Paul, MN
St. Louis Volunteer Lawyers and Accountants for the Arts	St. Louis, MO
State Bar of Georgia A Business Commitment Project	Atlanta, GA
Technology Assistance Small Business Development Center North Texas Small Business Development Center (NTSBDC)	Dallas, TX
Texas Accountants & Lawyers for the Arts (TALA)	Houston, TX
Texas Community Building with Attorney Resources / Texas C-BAR	Austin, Texas
The South Carolina Bar Pro Bono Program	Columbia, SC
The Veterans Consortium Pro Bono Program	Washington, DC
Volunteer Lawyers for the Arts	New York, NY
Volunteer Lawyers for the Arts of Massachusetts	Boston, MA
Washington Area Lawyers for the Arts (WALA)	Washington, D.C.

Happy bridging!

Written by Raymond Millien

Plaintiff Denied Promotion Based Upon Job Interview Survives Summary Judgement

Thu, 21 Feb 2013 05:00:00 GMT

When interviewing employees for a job promotion, it is probably best for the employer to have selection criteria that go beyond an employee’s performance during the job interview.

In the case of Hill v. Commonwealth of Virginia Department of Transportation (“VDOT”) (2013), a Virginia Federal District Court held that the employer’s stated reason for passing over the Plaintiff was not enough to grant summary judgment in favor of the employer. Plaintiff, Pamela Hill, applied for the position of assistant district administrator for construction and preliminary engineering. She, along with eight other candidates, interviewed for the position. Ultimately, a male colleague, Christopher Blevins, was chosen for the promotion. Hill alleged gender discrimination under Title VII of the Civil Rights Act of 1964 for being passed over for the position. Hill alleged that she was more qualified than Blevins and cited to her seventeen years of experience working for VDOT, prior promotions, supervisory experience, and her Bachelor’s Degree in Mining Engineering (Blevins did not have a college degree). At summary judgment, VDOT apparently did not argue that Blevins was more qualified than Hill. Instead, VDOT relied solely on its assertion that Blevins provided better answers to the interview questions than Hill.

In denying VDOT’s summary judgment motion, the Court held that Defendant’s nondiscriminatory reason for denying Hill the job promotion – a few lines of interview notes from the candidate interviews – was “entirely subjective and meagerly explained.” While the Court readily acknowledged that prior cases within the Fourth Circuit have upheld subjective employment decisions based (at least in part) upon interviews, it noted that those cases also included some objective criteria upon which the employer based its employment decision. Ultimately, the court held that VDOT’s reliance solely upon a few lines of interview notes was not enough to meet its burden at the summary judgment stage, and the case was allowed to proceed to a jury trial on the merits.

While it is fine to make a promotion based upon performance during an interview, this court decision is a reminder to employers that additional and objective promotion criteria should be utilized and documented in order to provide a clear non-discriminatory reason for the promotion decision.

Written by Malik Cutlar

Landscape 2013: Who are the Players in the IP Marketplace?

Wed, 23 Jan 2013 21:56:00 GMT

Please see Raymond Millien's new blog, "Landscape 2013: Who are the Players in the IP Marketplace?"

Located at IPWatchdog.com.

An Update on the Smart Phone Patent Wars

Wed, 09 Jan 2013 18:34:00 GMT

I have frequently written about the so-called “Smart Phone Patent Wars” as the Android, iOS and Windows operating systems fight for access to consumers’ palms across the world. Where do things stand today? That is, despite [or maybe because of?] all the patent fights, which operating system is winning? Well, see below!

Written By Raymond Millien