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Employers often have new employees sign an Employment Agreement at the time of their employment.  Basic terms of an Employment Agreement often require that the employee protect the intellectual property of the employer, and not disclose confidential information of the employer without authorization.  The basic terms of an Employment Agreement also often include a requirement that the employee assign to the employer any intellectual property rights of the employee to any inventions conceived by the employee under the terms of their employment.

However, it is important for the employer to realize that an Employment Agreement executed by an employee, that requires the employee to assign to the employer their intellectual property rights in any invention conceived by the employee under the terms of their employment is not an actual assignment of the invention to the employer.  A separate Assignment Agreement transferring intellectual property rights in an invention from the inventor employee to the employer is required.

This issue was addressed earlier this year by the United States Court of Appeals for the Federal Circuit in the case of Advanced Video Technologies LLC, v. HTC Corporation, HTC America, Inc., BlackBerry Limited, Blackberry Corporation and Motorola Mobility LLC.

In the Federal Circuit case, Advanced Video Technologies LLC appealed an order from the United States District Court for the Southern District of New York that dismissed its complaints of patent infringement for lack of standing.  The District Court based its decision to dismiss the patent infringement complaints on the ground that a co-owner of the patent was not a party to the action, and the co-owner’s ownership interests in the patent were not transferred to Advanced Video.

The dismissal of the patent infringement complaints by the District Court was affirmed by the Federal Circuit.

The appeal to the Federal Circuit involved U.S. Patent No. 5,781,788, titled “Full Duplex Single Clip Video Codec”.  The infringement of the patent was not at issue.  The single issue considered by the Federal Circuit was whether or not a co-inventor of the patent transferred her ownership interests in the patent under the terms of an Employment Agreement.  The co-inventor did not sign any separate Assignment Agreement transferring her ownership interests in the patent to her employer.  The co-inventor only signed an Employment Agreement.

The patent identifies three co-inventors of the subject matter of the patent.  For brevity sake, and to simplify this article, I identify the co-inventors as Inventor No. 1, Inventor No. 2 and Inventor No. 3.  The invention that is the subject of the patent was created while the three co-inventors were employed by Infochips Systems Inc.

Through a series of transfers, which are not discussed here for brevity sake and to simplify this article, the ownership interest in the invention and the ownership interest in the Employment Agreements were transferred from Infochips Systems Inc. to Advanced Video.  At one point during the series of transfers discussed above, the ownership interest in the invention and the ownership interest in the Employment Agreements were transferred to an entity called AVC Technology Inc. (“AVC”).  In 1995, AVC filed a parent patent application that eventually led to the patent of this article.  Two of three co-inventors, Inventor No. 1 and Inventor No. 2 executed assignments of their ownership interests in the invention and the patent application to AVC.  Inventor No. 3, however, refused to assign her ownership interest in the invention and in the patent application to AVC.  Although the patent application was not assigned to AVC by Inventor No. 3, AVC filed Petitions with the Patent Office requesting that it be permitted to prosecute the patent application.  The Patent Office granted AVC’s Petitions, and the patent was issued to AVC.  The patent rights held by AVC were later transferred to Advanced Video.

In 2016, Advanced Video filed three patent infringement lawsuits against HTC Corporation, HTC America, Inc., Blackberry Limited, Blackberry Corporation and Motorola Mobility LLC (the Appellees) in the District Court for the Southern District of New York.  In the lawsuits, Appellees filed a Motion to Dismiss for lack of standing.  Advanced Video argued in the District Court that it had acquired Inventor No. 3’s ownership rights in the invention and in the patent through the aforementioned series of transfers, beginning with a transfer from Inventor No. 3 to Infochips under the terms of the Employment Agreement signed by Inventor No. 3.  Advanced Video argued that there were three provisions of the Employment Agreement signed by Inventor No. 3 that effected a transfer of the invention and patent rights of Inventor No. 3 to Advanced Video.

The first provision of the Employment Agreement signed by Inventor No. 3 is a “will assign” provision.  This provision of the Employment Agreement states that “I agree that I…will assign to the Company all my right, title, and interest in and to any and all inventions”.  The second provision of the Employment Agreement is a “trust” provision.  This provision of the Employment Agreement states that “I agree that I will promptly make full written disclosure to the Company, will hold in trust for the sole right and benefit of the Company…all my right, title, and interest in and to any and all inventions”.  The third provision of the Employment Agreement is a quitclaim provision.  This provision of the Employment Agreement recites “I hereby waive and quitclaim to the Company any and all claims, of any nature whatsoever, which I now or may hereafter have infringement [sic] of any patents”.

The District Court concluded that none of the three provisions effected a transfer of Inventor No. 3’s ownership rights in the invention and in the patent to Advanced Video.  Additionally, because Inventor No. 3 was not a party to the lawsuit, the District Court dismissed the case for lack of standing.  Advanced Video appealed to the Federal Circuit.

At the Federal Circuit, Advanced Video argued that Inventor No. 3’s ownership rights transferred upon execution of the Employment Agreement by Inventor No. 3, citing the “will assign” language in the Employment Agreement.

The District Court had earlier found that “will” invoked a promise to do something in the future and did not effect a present assignment.  The Federal Circuit agreed with the District Court that no present assignment existed in the Employment Agreement.  The “will assign” language alone does not create an immediate assignment of Inventor No. 3’s rights in the invention.

At the Federal Circuit, Advanced Video also argued that the “will hold in trust” language of the Employment Agreement created an immediate trust in favor of Infochips (recall that Infochips’ ownership interest in the Employment Agreement was later transferred to Advanced Video”.  The court stated that even if they were to determine that Inventor No. 3’s interests in the invention were immediately placed in trust, it did not follow that those interests were automatically, or ever, actually transferred out of trust in favor of Infochips.  Absent a transfer, Inventor No. 3 would continue to hold the invention rights as a trustee.  The Court further pointed out that while Advanced Video could potentially seek to enforce its alleged ownership rights, or allege a breach of Inventor No. 3’s duties as a trustee by her failure to transfer those rights by bringing an action against Inventor No. 3, no party brought such an action.  Since Advanced Video had not sought to enforce any obligation Inventor No. 3 might have had under the trust, it ultimately has no standing to bring a patent infringement action.

The Court further noted that even if Advanced Video is correct that Inventor No. 3’s rights are held in trust, Advanced Video, as a trust beneficiary, cannot maintain a patent infringement suit where Inventor No. 3 is not a party, nor can Inventor No. 3 as a co-owner of the patent be involuntarily joined as a plaintiff, except under limited circumstances that did not apply.

Advanced Video further maintained that it had standing because it eventually acquired Inventor No. 3’s ownership interest in the invention when Inventor No. 3 quitclaimed her interest to Infochips under the terms of the Employment Agreement.

Advanced Video argued that the quitclaim provision of the Employment Agreement which recites “I hereby waive and quitclaim to the Company any and all claims, of any nature whatsoever, which I now or may hereafter have infringement [sic] of any patents, copyrights, or mask work rights resulting from any such application assigned hereunder to the Company” should essentially be read to mean all claims “assignable hereunder,” and that rights that Inventor No. 3 promised she “will assign” were immediately quitclaimed under the Employment Agreement.  The Court noted that the Employment Agreement, however, did not provide “assignable hereunder” language.  The Court noted that Advanced Video cited no authority showing that “assigned hereunder” covers patent rights that could have been assigned under a contract, but were never actually assigned.

The Court held that the quitclaim provision waives Inventor No. 3’s rights to interests in any patent rights that she assigned under the Employment Agreement.  But, as no patent rights were ever assigned to Infochips, the quitclaim provision has no application.  The Court then found that the quitclaim provision of the Employment Agreement did not effect an assignment of the patent from Inventor No. 3 to Infochips, AVC, or Advanced Video.

The Federal Circuit then held that Advanced Video did not have full ownership of the patent.  Inventor No. 3 was neither a party to the suits, nor had Inventor No. 3 consented to the suits.  Advanced Video, therefore, had no standing to maintain its suits.  Accordingly, the Federal Circuit affirmed the District Court’s dismissal of the cases.

The Federal Circuit’s decision reemphasizes the importance that employers, even though they may have Employment Agreements in place that require employees to assign to the employer any intellectual property rights of the employee to any inventions conceived by the employee under the terms of their employment, a separate assignment agreement transferring intellectual property rights in an invention from the inventor employee to the employer is required.

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The Blog for Business Law by Joseph Rolnicki - 1y ago

If you are involved in a business that routinely introduces new products to the marketplace, or a business that exists due to a recently developed new product such as a startup business, you should consider protecting the new product or products with a patent.  A good practice in considering whether a new product should be protected by a patent is preparing an invention disclosure for the new product.  An invention disclosure can be used by a business in evaluating the commercialization of a new product.  An invention disclosure can also be used as a written record of the conception date for a new product and a history of the development of the new product.  Invention disclosures can also be used by a patent attorney in conducting patentability research of the new product and in preparing a patent application for the new product.  Many businesses use a standardized invention disclosure to record the development of a new product that may eventually be protected by a patent.

TITLE

A typical invention disclosure includes a title of the new product or invention.  The title should be brief.  Anyone that reads the title should be apprised of the type of product the invention disclosure pertains to.

CONTRIBUTOR (POTENTIAL INVENTOR) INFORMATION

All of the individuals that contributed to the development of the new product should be identified in the invention disclosure as potential inventors.  The full legal names of the inventor(s) should be provided.  Additionally, the residence address and citizenship of each inventor(s) should be provided.  This information will be used in preparing an Application Data Sheet, should the invention disclosure eventually lead to a patent application.

HISTORY OF INVENTION

It is good practice to include a short history of the development of the invention in the invention disclosure.  The inventor(s) should, to the best of their recollection provide a date when the invention was first conceived of.  The inventor(s) should also provide a description or explanation of any events that took place that led to the conception of the invention.  A history of the development of the invention, from its conception date to its current form should also be provided.

DESCRIPTION OF THE INVENTION

The most important part of the invention disclosure is the description of the invention in its current form.  In preparing the description of the invention, the more information provided, the better.  The description of the invention should include a description of what are considered to be the novel features of the invention.  The description of the invention should also include a description of how the invention is constructed, how the invention is used, and what makes the invention better than what was known before (prior knowledge or prior art).  One or more drawing views of the invention, or photographs of a prototype of the invention if available should be made a part of this portion of the invention disclosure.  Terms of art, or technical terms in the field of the invention should be used in the description of the invention.  However, lay person terms should also be used in the description and in explaining the meaning of the terms of art.  A description of the invention should be sufficient to enable a person of ordinary skill in the technology to which the invention pertains to make and use the invention.

PUBLIC DISCLOSURE

If there has been any public disclosure of the invention without a confidentiality agreement in place, it is important that the date of the public disclosure be identified in the invention disclosure.  The public disclosure could be in a publication that describes the invention, or an oral disclosure of the invention to a party that is under no obligation to keep the disclosure confidential.  Any date that the invention was offered for sale or sold should also be identified in the invention disclosure.

A well written and comprehensive invention disclosure is the first step in a business assessing the marketability of an invention and the possibility of obtaining patent protection for the invention.  Click here for an Invention Disclosure form that I provide to clients.

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What to most of us would seem to be an obvious conclusion, the United States Seventh Circuit Court of Appeals confirmed that if you try to move rolls of insulation in a self-service area, and notice that a stack of insulation is leaning, don’t expect to recover damages if the stack of insulation later falls on you. In Dunn v. Menard, Inc. No. 17-1810 (7th Cir.), decided in January 29, 2018, the Seventh Circuit affirmed a District Court’s grant of summary judgment finding that Menards did not owe the plaintiff a legal duty of care.

The underlying facts to the case are relatively simple.  Mr. Dunn and his adult son purchased 21 rolls of fiberglass insulation inside the main store portion of Menards. After completing the transaction, a cashier told Dunn to go to one of Menards self-service warehouses to pick up the rolls. At the warehouse, a security guard directed him to the insulation. Posted at the entrance was a sign which said: “For your safety, caution, do not open packages, do not pull, do not climb, and if you need assistance, please call.” Dunn saw no Menards employees, but did not call for assistance. Instead, Dunn and his son decided to load rolls of insulation into their van by themselves. They did notice that one stack of insulation, approximately 16 feet in height, was not straight but leaning to the right. Although Dunn and his son claimed not to have touched the leaning stack during loading, the stack fell knocking Dunn to the floor and injuring his right shoulder.

After discovery, Menards moved for summary judgment on the grounds that the danger of the stack falling was open and obvious, and it did not owe plaintiff a legal duty.

In affirming the grant of summary judgment by the lower court, the Appellate Court noted that the “open and obvious doctrine” is an exception to the general duty owed by the premises owner. “The law generally assumes that persons who encounter obvious conditions will take care to avoid any danger inherent in such condition.”

In opposing the motion for summary judgment, Dunn tried to argue that there were “different opinions and interpretations” as to how the leaning stack appeared, and so created an issue of fact. The Seventh Circuit, however, would have none of that. It held there was undisputed testimony that the stack was “unstable” and that it was “obvious.” The Court rejected Dunn’s argument that, while he saw the condition, he did not fully appreciate its risk. The Seventh Circuit stated that it does not matter what the plaintiff actually thought or may have appreciated, rather what a reasonable person with knowledge would have done under the circumstances.

The Appellate Court also rejected the argument that the landowner should have anticipated that the plaintiff would have deliberately encountered the situation. The Court said that such an exception did not apply since other options (including asking for help) were available to Dunn. Additionally, the mere fact of looking elsewhere did not constitute a distraction such as to preclude the application of the application and open and obvious doctrine.

The Court also rejected the notion that Menards had a legal duty to constantly patrol its self-serve warehouse to prevent customers from injuring themselves. The lack of continuous surveillance did not create a legal duty to the plaintiff and the Appellate Court said it would not impose such a duty as a matter of law.

What is the takeaway? Plaintiff shoppers are obligated to look out for themselves, and cannot willingly encounter a danger, and then claim the store owner should have prevented the danger.

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There is an all too common occurrence facing many people: What to do when an elderly person dies and you are the only one around to pick up the pieces.

Here is the scenario: You receive a call and learn your Great Aunt Minnie or Uncle Edgar has died. You were not very close to the decedent. The decedent had been married, but the spouse either previously died or was divorced. Your relative left no children, only a number of nieces, nephews and assorted cousins, none of whom were close to the decedent (including yourself). In fact, you had not seen the decedent or your relatives for years. Being the responsible person in the group, you decide to take charge to make sure the relative is buried, the last bills are paid, and any assets distributed.

Unfortunately you are unfamiliar with your decedent’s business affairs and don’t know what to do next. What Should You Do?

Based on past similar situations facing my clients, here are some practical suggestions:

  • Don’t Panic or Feel Overwhelmed.
  • Look through the relative’s business papers to see if there was a Will, Trust or other end-of-life documents. You may have to check with the decedent’s bank to see if the decedent had a safety deposit box and if there was a will in the safety deposit box, and if so, have the bank send it to the local probate court. Remember to check any home safes or lock boxes.
  • If no one was on the decedent’s bank accounts, you may have to make arrangements or advance funds to have the decedent buried or the remains properly taken care of honoring the decedent’s wishes if known. [Again, check to see if the decedent had a funeral home’s prepaid burial plan or other funeral insurance policies]. Check also to see if the decedent left any specific instructions for burial, cremation, or body donation to science.
  • Contact the decedent’s attorney or if the decedent had no attorney, find a local attorney with knowledge of local probate procedures.
  • Gather all bills and invoices as they come in.
  • Stop any non-necessary on-going expenses for services (newspaper, charity donations).
  • If a residence is owned, have the locks changed immediately (you have no idea who might have prior keys).
  • Work with the chosen attorney to decide if an estate has to be opened and who should be the Executor/Personal Representative. [For example, depending on the value of remaining assets, it might be less costly or easier to set up a Small Estate rather than a “full blown” Probate Estate. This is especially true if the only remaining asset is a used car].
  • Make sure you check over the Death Certificate for accuracy (you would be surprised how many simple errors will cause future grief), and if accurate that you order a sufficient number of copies.
  • If you are the Personal Representative, check to see if there were any current life insurance policies (This includes old fully paid up polices for which the decedent had not recently paid premiums).
  • Check to see, if appropriate, if there are any Veterans benefits, public employee benefits, or private organization benefits that might be payable.
  • Keep copies of all receipts that you expend on behalf of the estate.
  • Take care of any pets the decedent still has.

A final bit of advice- -keep calm. By working with a competent attorney, your stress should be lessened. The attorney should be able to assist you through the process.

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The Blog for Business Law by Joseph Rolnicki - 1y ago

If you are involved in a business that routinely introduces new products to the marketplace, or a business that exists due to a recently developed new product such as a startup business, you should consider protecting the new product or products with a patent.  A good practice in considering whether a new product should be protected by a patent is preparing an invention disclosure for the new product.  An invention disclosure can be used by a business in evaluating the commercialization of a new product.  An invention disclosure can also be used as a written record of the conception date for a new product and a history of the development of the new product.  Invention disclosures can also be used by a patent attorney in conducting patentability research of the new product and in preparing a patent application for the new product.  Many businesses use a standardized invention disclosure to record the development of a new product that may eventually be protected by a patent.

TITLE

A typical invention disclosure includes a title of the new product or invention.  The title should be brief.  Anyone that reads the title should be apprised of the type of product the invention disclosure pertains to.

CONTRIBUTOR (POTENTIAL INVENTOR) INFORMATION

All of the individuals that contributed to the development of the new product should be identified in the invention disclosure as potential inventors.  The full legal names of the inventor(s) should be provided.  Additionally, the residence address and citizenship of each inventor(s) should be provided.  This information will be used in preparing an Application Data Sheet, should the invention disclosure eventually lead to a patent application.

HISTORY OF INVENTION

It is good practice to include a short history of the development of the invention in the invention disclosure.  The inventor(s) should, to the best of their recollection provide a date when the invention was first conceived of.  The inventor(s) should also provide a description or explanation of any events that took place that led to the conception of the invention.  A history of the development of the invention, from its conception date to its current form should also be provided.

DESCRIPTION OF THE INVENTION

The most important part of the invention disclosure is the description of the invention in its current form.  In preparing the description of the invention, the more information provided, the better.  The description of the invention should include a description of what are considered to be the novel features of the invention.  The description of the invention should also include a description of how the invention is constructed, how the invention is used, and what makes the invention better than what was known before (prior knowledge or prior art).  One or more drawing views of the invention, or photographs of a prototype of the invention if available should be made a part of this portion of the invention disclosure.  Terms of art, or technical terms in the field of the invention should be used in the description of the invention.  However, lay person terms should also be used in the description and in explaining the meaning of the terms of art.  A description of the invention should be sufficient to enable a person of ordinary skill in the technology to which the invention pertains to make and use the invention.

PUBLIC DISCLOSURE

If there has been any public disclosure of the invention without a confidentiality agreement in place, it is important that the date of the public disclosure be identified in the invention disclosure.  The public disclosure could be in a publication that describes the invention, or an oral disclosure of the invention to a party that is under no obligation to keep the disclosure confidential.  Any date that the invention was offered for sale or sold should also be identified in the invention disclosure.

A well written and comprehensive invention disclosure is the first step in a business assessing the marketability of an invention and the possibility of obtaining patent protection for the invention.  Click here for an Invention Disclosure form that I provide to clients.

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What to most of us would seem to be an obvious conclusion, the United States Seventh Circuit Court of Appeals confirmed that if you try to move rolls of insulation in a self-service area, and notice that a stack of insulation is leaning, don’t expect to recover damages if the stack of insulation later falls on you. In Dunn v. Menard, Inc. No. 17-1810 (7th Cir.), decided in January 29, 2018, the Seventh Circuit affirmed a District Court’s grant of summary judgment finding that Menards did not owe the plaintiff a legal duty of care.

The underlying facts to the case are relatively simple.  Mr. Dunn and his adult son purchased 21 rolls of fiberglass insulation inside the main store portion of Menards. After completing the transaction, a cashier told Dunn to go to one of Menards self-service warehouses to pick up the rolls. At the warehouse, a security guard directed him to the insulation. Posted at the entrance was a sign which said: “For your safety, caution, do not open packages, do not pull, do not climb, and if you need assistance, please call.” Dunn saw no Menards employees, but did not call for assistance. Instead, Dunn and his son decided to load rolls of insulation into their van by themselves. They did notice that one stack of insulation, approximately 16 feet in height, was not straight but leaning to the right. Although Dunn and his son claimed not to have touched the leaning stack during loading, the stack fell knocking Dunn to the floor and injuring his right shoulder.

After discovery, Menards moved for summary judgment on the grounds that the danger of the stack falling was open and obvious, and it did not owe plaintiff a legal duty.

In affirming the grant of summary judgment by the lower court, the Appellate Court noted that the “open and obvious doctrine” is an exception to the general duty owed by the premises owner. “The law generally assumes that persons who encounter obvious conditions will take care to avoid any danger inherent in such condition.”

In opposing the motion for summary judgment, Dunn tried to argue that there were “different opinions and interpretations” as to how the leaning stack appeared, and so created an issue of fact. The Seventh Circuit, however, would have none of that. It held there was undisputed testimony that the stack was “unstable” and that it was “obvious.” The Court rejected Dunn’s argument that, while he saw the condition, he did not fully appreciate its risk. The Seventh Circuit stated that it does not matter what the plaintiff actually thought or may have appreciated, rather what a reasonable person with knowledge would have done under the circumstances.

The Appellate Court also rejected the argument that the landowner should have anticipated that the plaintiff would have deliberately encountered the situation. The Court said that such an exception did not apply since other options (including asking for help) were available to Dunn. Additionally, the mere fact of looking elsewhere did not constitute a distraction such as to preclude the application of the application and open and obvious doctrine.

The Court also rejected the notion that Menards had a legal duty to constantly patrol its self-serve warehouse to prevent customers from injuring themselves. The lack of continuous surveillance did not create a legal duty to the plaintiff and the Appellate Court said it would not impose such a duty as a matter of law.

What is the takeaway? Plaintiff shoppers are obligated to look out for themselves, and cannot willingly encounter a danger, and then claim the store owner should have prevented the danger.

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There is an all too common occurrence facing many people: What to do when an elderly person dies and you are the only one around to pick up the pieces.

Here is the scenario: You receive a call and learn your Great Aunt Minnie or Uncle Edgar has died. You were not very close to the decedent. The decedent had been married, but the spouse either previously died or was divorced. Your relative left no children, only a number of nieces, nephews and assorted cousins, none of whom were close to the decedent (including yourself). In fact, you had not seen the decedent or your relatives for years. Being the responsible person in the group, you decide to take charge to make sure the relative is buried, the last bills are paid, and any assets distributed.

Unfortunately you are unfamiliar with your decedent’s business affairs and don’t know what to do next. What Should You Do?

Based on past similar situations facing my clients, here are some practical suggestions:

  • Don’t Panic or Feel Overwhelmed.
  • Look through the relative’s business papers to see if there was a Will, Trust or other end-of-life documents. You may have to check with the decedent’s bank to see if the decedent had a safety deposit box and if there was a will in the safety deposit box, and if so, have the bank send it to the local probate court. Remember to check any home safes or lock boxes.
  • If no one was on the decedent’s bank accounts, you may have to make arrangements or advance funds to have the decedent buried or the remains properly taken care of honoring the decedent’s wishes if known. [Again, check to see if the decedent had a funeral home’s prepaid burial plan or other funeral insurance policies]. Check also to see if the decedent left any specific instructions for burial, cremation, or body donation to science.
  • Contact the decedent’s attorney or if the decedent had no attorney, find a local attorney with knowledge of local probate procedures.
  • Gather all bills and invoices as they come in.
  • Stop any non-necessary on-going expenses for services (newspaper, charity donations).
  • If a residence is owned, have the locks changed immediately (you have no idea who might have prior keys).
  • Work with the chosen attorney to decide if an estate has to be opened and who should be the Executor/Personal Representative. [For example, depending on the value of remaining assets, it might be less costly or easier to set up a Small Estate rather than a “full blown” Probate Estate. This is especially true if the only remaining asset is a used car].
  • Make sure you check over the Death Certificate for accuracy (you would be surprised how many simple errors will cause future grief), and if accurate that you order a sufficient number of copies.
  • If you are the Personal Representative, check to see if there were any current life insurance policies (This includes old fully paid up polices for which the decedent had not recently paid premiums).
  • Check to see, if appropriate, if there are any Veterans benefits, public employee benefits, or private organization benefits that might be payable.
  • Keep copies of all receipts that you expend on behalf of the estate.
  • Take care of any pets the decedent still has.

A final bit of advice- -keep calm. By working with a competent attorney, your stress should be lessened. The attorney should be able to assist you through the process.

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On May 11, 2016, a new federal law protecting trade secrets (the “Defend Trade Secrets Act”) went into effect. Prior to the law going into effect, remedies for trade secret theft were governed by the laws of the various states, which laws often provided for a lack of uniformity in enforcing trade secret protections. The new federal law has many facets to it, but the major change brought about by the law is that now, companies that have been the victim of trade secret theft have the option of suing under the federal statute, which allows for federal court jurisdiction and should provide for more uniformity in trade secret protection.

One of the provisions of the new law provides for recovery of attorneys’ fees and multiple damages in cases of willful and malicious misappropriation. However, in the case of employees (an employee is defined to include a consultant or an independent contractor), the law provides immunity from civil or criminal claims under any federal or state law for the confidential disclosure of trade secrets to a government official or an attorney for the purpose of reporting or investigating a suspected violation of law. (This immunity is referred to as “whistle blower protection.”) Importantly, to take advantage of the provision allowing attorneys’ fees and enhanced damages, the employer must provide its employee with written notice of the whistleblower immunity afforded by the law in any contract or agreement with the employee that governs the use of trade secrets or confidential information. If the employer fails to provide this notice, the employer cannot receive attorneys’ fees or the enhanced damages in a suit against the employee under the statute.

The obligation to include the notice applies to contacts and agreements entered into or amended after May 11, 2016. The obligation extends to not just employment contracts, but any contract with the employee governing trade secrets. Such agreements could include non-disclosure agreements, consulting agreements, invention rights agreements, severance agreements and non-compete agreements. If the employer chooses, rather than continually adding the notice to every agreement, the employer can provide a cross-reference in its agreements to a written policy setting forth the immunity provisions afforded by the law.

In conclusion, in view of the Defend Trade Secrets Act, any employer wanting to ensure the ability to recover enhanced damages and attorneys’ fees in trade secret litigation should immediately start including the notice of whistleblower protections in all new and revised agreements with employees, contractors or consultants that include sections that govern trade secrets and confidential information.

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It’s an election season once again and jobs are in the forefront. There are real opportunities in those Brownfields to create jobs, particularly in areas which are disadvantaged. For example, “the Missouri Brownfields program awards various tax credits to businesses that remediate properties and create a specified number of jobs. In 2006 a study was performed to determine the investment value of 50 redeveloped sites. The study concluded that the total investment on the property was $2.2 billion. Approximately, 11,053 full-time jobs were created. Nearly 160 thousand tons of contaminated materials were removed, and 686 acres were successfully developed. Equally important, twenty-three historical buildings were returned to use.” Schmittgens, Eugene P. (2014) The Politics of Environmental Regulations: What Happened to Market Based Regulations? (Master’s Thesis) pp. 38-39. (I guess it’s OK to cite my own research)

In addition to private investment, EPA and DNR also invest into Brownfields. Recently, the Environmental Workforce Development and Job Training (EWDJT) program announced its 2016 recipients of grants designed to “recruit, train, and place unemployed and severely under-employed individuals from these impacted communities in long-term environmental careers.” The impact of this Program, according to EPA is “[s]ince the inception of the EWDJT grant program in 1998, more than 256 grants have been awarded exceeding $54 million. Approximately 14,700 individuals have completed training, and of those, more than 10,600 individuals have been placed in full-time employment with an average starting hourly wage of $14.34. This equates to a cumulative job placement rate of nearly 72 percent of graduates.“

DNR also makes grants available to city, county, quasi-governmental or non-profit organizations to allow them to undertake assessments of properties that have some environmental concerns. Experience indicates that the more one knows about a property, the easier it is to market it to potential developers. These reports will, to a small extent, let a potential developer know what issues may confront them at the site. The best thing is that these reports are funded by the State (at least as long as their grant money holds out). So, if you are a city, county, quasi-governmental or non-profit organizations, you can use this application for this as well.

A conglomeration of groups has hosted a Brownfields’ Marketplace where interested cities, counties, quasi-governmental or non-profit organizations are paired with interested developers to pitch properties; a “speed dating” concept. Evans & Dixon has teamed with St. Louis University to re-introduce this concept to the area. That process has started and the opportunity for a city, county, quasi-governmental or non-profit organizations, in both Missouri and Illinois, to prepare properties for the speed dating event in November of this year.

One of the lessons learned from the previous Marketplaces is that smaller organizations don’t have the expertise to know how to market abandoned properties. Therefore, a training program was held earlier in the month to provide information to interested organizations to go over the Brownfields’ process, what assistance is available, basics in Urban Planning and what a developer is looking for in a property. We hope to use the next several months to work with any city, county, quasi-governmental or non-profit organizations to try to help them put together their property package to present to developers.

Interested entities are still able to get assistance. All you need to do is contact Professor Sarah Coffin at St. Louis University (coffinsl@slu.edu). We hope that there will be more than a few “matches” made at our speed dating event in November. We also hope this will be the first of what will be a regular event.

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A closely-held corporation can benefit from having an outside director with special expertise (e.g., strategy, marketing, HR, technology, finance and international business). However, potential outside directors are often reluctant to take on the role of a director of a closely-held corporation because of fiduciary obligations and other potential liabilities (e.g., environmental, employment discrimination, unpaid wages, unpaid taxes and regulatory liability).

A corporation can derive many of the benefits of an outside director, while avoiding many of the problems, by appointing an advisory board. An entrepreneur with a closely-held business may also be reluctant to dilute authority with outside directors, but may be comfortable with an advisory board which renders advice but has management authority or responsibility.

An advisory board can address particular issues only without the need to monitor all aspects of the business which a corporate board of directors must do. An advisory director can bring expertise, contacts and relevant skills that may not be otherwise readily available to the corporation. Also, the compensation of advisory directors will generally be less than that required for corporate directors and that would be required by consultants with comparable skills and who may not have the personal commitment of advisory directors.

In appointing advisory directors, the following matters should be addressed:

Focus: The aspects of the business on which the advisory directors are to focus.

Compensation: Compensation which may be in the form of cash and stock, or a combination thereof, and which can be fixed or variable based on time commitment.

Time Commitment: The time commitment which can be fixed or variable.

Term: The term of the appointment. Because it is always more difficult to terminate an advisory director than to appoint one, the appointment should be for a fixed term (e.g., one, two or three years) which may or may not be renewed.

Confidentiality: Unlike a corporate director, an advisory director is not subject to a duty of confidentiality. Accordingly, confidentiality obligations should be contractually addressed.

Indemnification: Without a specific agreement, advisory directors are not entitled to be indemnified by the corporation for claims against them as a result of serving as an advisory director and may be unwilling to serve for that reason. Accordingly, contractual indemnification provisions and coverage under applicable directors and officers liability insurance should be considered.

Advisory boards can allow a closely-held corporation to obtain the expertise of persons who would be reluctant to become corporate directors because of liability concerns. The steps involved in setting up an advisory board are adoption of a board resolution authorizing the advisory board and preparation of an advisory board member agreement setting forth the respective rights and obligations of the corporation and the advisory director. In some instances, it may be appropriate for the board of directors to adopt a charter for the advisory board.

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