2012 Launching & Sustaining Accountable Care Organizations Conference

The National Law Review is pleased to bring you information on the Launching & Sustaining Accountable Care Organizations Conference will be a two-day, industry focused event specific to CEOs, COOs, CFOs, CMOs, Vice presidents and Directors with responsibilities in Accountable Care Organizations, Managed Care and Network Management from Hospitals, Physician Groups, Health Systems and Academic Medical Centers.

By attending this event, industry leaders will share best practices, strategies and tools on incorporating cost-sharing measures in a changing healthcare landscape to strengthen the business model and ensure long-term success.

Attending This Event Will Enable You to:
1. Understand the initial outcomes and lessons learned from launching ACOs, with a focus on how to sustain these partnerships in the future
2. Hear from the early adopters of ACOs or similar cost-reducing partnerships and understand their initial operational and implementation challenges.
3. Learn about the final regulations regarding ACOs and their impact on those who want to initiate the formation process
4. Gain a clear understanding of regulatory issues and accreditation processes
5. Conquering initial hurdles for establishing an ACO
6. Gain knowledge from newly-formed ACOs
7. Ensure longevity by establishing a robust long-term plan

Transfer of Ownership Requires a Written Assignment

Recently in The National Law Review was an article by Jeremy T. Elman of McDermott Will & Emery regarding the Transfer of Patent Ownership:

Addressing the issue of patent ownership based on contractual assignments, the United States Court of Appeals for the Federal Circuit affirmed the district court’s decision dismissing patent ownership claims where a consulting agreement contained no express assignment language requiring defendant to assign the patents-in-suit to plaintiffs.Abbott Point of Care, Inc. v. Epocal, Inc., Case No. 11-1024 (Fed. Cir., Jan. 12, 2012) (Rader, C.J.)

Defendant-appellee Epocal was founded by Dr. Imants Lauks (Lauks), who was previously an employee of a predecessor company of plaintiff-appellant Abbott, with whom he signed three contracts (two employment agreements and one consulting agreement).  Both Epocal and Abbott claim to own the patents-in-suit, which cover systems for testing blood samples.Epocal is the assignee of both patents.  Lauks’ 1984 employment agreement contained language assigning all inventions to Abbott’s predecessor company (Integrated Ionics), but his 1999 consulting agreement, although it stated that the 1984 agreement remained in effect for work done while Lauks was an employee, was “silent” as to assignments of any inventions.  Lauks filed applications for these two patents in 2001, after which Abbott sued Epocal and claimed ownership of the patents pursuant to the 1984 agreement.  Epocal claimed ownership pursuant to the 1999 consulting agreement.After the district court granted Epocal’s motion to dismiss, Abbott appealed.

After noting that the Court reviews decisions on standing and contracts without deference, the Federal Circuit noted that Abbott had the burden of showing ownership and concluded that under New Jersey law, where the contract was apparently signed, the 1984 employment agreement ceased upon the execution of 1999 consulting agreement.  The 1999 consulting agreement expressly stated that Lauks resigned from his position and the 1999 consulting agreement then refers to Lauks as a “Senior Consultant,” i.e., no longer an employee.  The Court found that the 1999 consultant agreement did not specify that the entire 1984 employment agreement remained in effect, but only the confidentiality provisions.  The 1999 consulting agreement was silent as to any assignment of inventions, but “recognized and allowed Lauks to pursue other, non-conflicting interests.”  The Court thus found that there was an express recognition that Lauks’ agreement in the 1984 employment agreement to assign his inventions had ceased.   The Court rejected the contention that Lauks had a duty to continue to assign his inventions to Abbott, finding that proposed interpretation to be in conflict with the express language of the 1999 consulting agreement.  The Court thus held that Epocal was the owner of the patents-in-suit and affirmed the district court’s dismissal of Abbott’s infringement claim.

Practice Note: Companies should carefully examine patent assignment obligations of their employees or consultants and, in connection with corporate changes, examine whether prior assignment agreements will impose continuing assignment obligations after the employee or consultant has ceased employment with the company.

© 2012 McDermott Will & Emery

7th Drug & Medical Device Litigation Forum, 7-8 Mar 2012, Philadelphia

The National Law Review is pleased to inform you of the 7th Drug & Medical Device Litigation Forum: Implementing Appropriate Litigation Readiness and Costs Management Policies That Ensure An Effective Defense at Trial 
Event Date: 7-8 Mar 2012
Location: Philadelphia, PA, United States
Key conference topics
  • Mitigate and maintain costs associated with litigation
  • Gain judical insight on drug and medical litigation and its recent developments
  • Build better relationships with outside counsel in order to reduce the miscommunciation factor
  • Understand the limitations of marketing and advertising as it relates to emerging social media issues
  • Learn the latest on medical device product liability

Conference focus

 Pharmaceutical and medical device manufacturers have faced a growing array of legal challenges this year. With the increase of mass tort litigation, as it relates to product liability, pharmaceutical and medical device manufacturers must be prepared to defend the increasingly sophisticated, well-funded and multi-jurisdictional product liability campaigns against their companies.

The 7th Drug and Medical Device Litigation Conference will be a two-day, industry focused event specific to those within Drug & Medical Device Litigation, Product Liability and Regulatory Affairs in the Medical Device, Biotech and Pharmaceutical industries.

By attending this event, industry leaders will share best practices, strategies and tools on incorporating litigation readiness, utilizing cost efficient litigation strategies and accurately managing policies to ensure an effective defense at trial.

Attending This Event Will Enable You to:
1. Review the current landscape of drug and medical device litigation
2. Learn strategies in settlements and mass tort issues
3. Manage litigation expenses in order to effectively manage costs
4. Review recent case rulings, including the Mensing and Levine cases
5. Take a view from the bench: explore drug and medical device litigation
from a judicial point of view
6. Tackle product liability issues and challenges
7. Uncover the risks for drug and medical device companies when leveraging social media for marketing and advertising campaigns

With a one-track focus, the 7th Drug and Medical Device Litigation Conference is a highly intensive, content-driven event that includes case studies, presentations and panel discussions over two full days.

This is not a trade show; our Drug and Medical Device Litigation conference series is targeted at a focused group of senior level leaders to maintain an intimate atmosphere for the delegates and speakers. Since we are not a vendor driven conference, the higher level focus allows delegates to network with their industry peers.

Testimonials:

“Great selection & breadth of speakers. Uniformly high quality of presentations. Intimate nature of meeting provided excellent opportunities for networking” – Abbott

“Great venue to learn and exchange best practices. More importantly how to leverage lesions learned from others.” – Baxter

“One of the best meetings I’ve attended. Excellent organization, topics and speakers. Overall extremely well done.” – Sanofi Aventis

marcusevans


Indiana Becomes the First "Right-to-Work" State in the Rust Belt

The National Law Review recently published an article regarding Right-to-Work by Lisa Carey-Davis of Schiff Hardin LLP:

Indiana Governor Mitch Daniels signed the Right-to-Work Act, making Indiana the first Rust Belt state — and the first state in more than ten years — to adopt right-to-work legislation. With this law, Indiana joins 22 other states, mostly in the southern and western United States, that prohibit employers from requiring employees to become or remain union members and to pay dues or fees to the union as a condition for getting — and keeping — their jobs.

The Impact of the New Law in Indiana and Beyond

Supporters of the new law contend that because it offers employers “more flexibility and lower hiring costs,” more businesses will now choose to call Indiana home. Republican House Speaker Brian Bosma declared that the Right-to-Work Act “announces, especially in the Rust Belt, that we are open for business.”

Some suggest that other Rust Belt states may soon follow Indiana’s example. State Representative Jerry Torr, who sponsored Indiana’s bill, has predicted that two of Indiana’s more heavily unionized neighbors — Michigan (19%) and Ohio (14%) — will “fall like dominoes” in the wake of Indiana’s decision because “they will have to in order to compete.” Mike Shirkey, a Republican state representative from Michigan, admitted that he was disappointed that Indiana beat Michigan to the punch, adding “now a border state is going to establish a leverage position in being attractive to businesses.”

Currently, roughly 11% of Indiana’s workforce is unionized, primarily in the auto and steel industries. If history is any indication, that number may soon decline. On average, right-to-work states have significantly lower rates of unionization than states without such laws. In 2010, for example, the average rate of unionization was seven percent in right-to-work states, while the average in the rest of the states was more than double at 15%.

The Right-To-Work Act was passed by Indiana’s Republican-controlled legislature over bitter opposition from Democratic lawmakers, including a walkout by House Democrats that denied Republicans for several weeks the quorum required to take action on the bill. Democrats also proposed an amendment that would have put a Right-to-Work referendum on the November ballot, but that amendment was voted down. Unlike Ohio — where a short-lived statute that stripped public sector employees of collective bargaining rights was struck down last year by voters — ballot initiatives in Indiana must be approved by the legislature and cannot be introduced by voters. Therefore, a referendum vote on Indiana’s new law is unlikely.

What the New Law Means for Indiana Employers

The new law contains a grandfather clause that exempts any collective bargaining agreement already in effect on March 14, 2012. Until those grandfathered contracts expire, employers may continue to abide by and enforce union security provisions contained therein by requiring employees to join unions and to pay dues as a condition of employment.

But contracts “entered into, modified, renewed, or extended” after the new law takes effect on March 14 cannot contain such requirements. Specifically, the law prohibits employers from requiring employees to join or remain members of any labor organization, and from requiring them to pay dues, fees or “other charges of any kind” to such organizations. If a contract violates any of these prohibitions, the entire contract — not just the offending clause — is “unlawful and void” according to the statute. In addition, any Indiana employer that violates the law may be subject to both criminal and civil penalties and may be sued by an individual who claims to have been injured by the employer’s actual or threatened violation of the law.

Employers are not required to inform employees about the change in the law, but some may wish to do so.

© 2012 Schiff Hardin LLP

The 15th Annual ABA National Institute on the Gaming Law Minefield Feb 24-25 LasVegas

The 2011 Gaming Law Minefield program is specifically designed to provide in-depth coverage and discussion of the cutting-edge legal, regulatory, and ethical issues confronting both commercial and Native American gaming. Attorneys, compliance officers, Native American leaders, regulators, and legislators will all provide invaluable insights into current trends, opportunities and obstacles in the gaming industry. The program’s subject matter includes new gaming technology, increased IRS CTR and SAR compliance audit activity, Internet gaming, Native American gaming, breaking hot topics in the gaming industry, latest developments in dealing with problem gamblers, and a two-hour CLE-certified ethics program.

The Gaming Law Minefield program constitutes one of the most comprehensive, state-of-the-law gaming programs available. Program attendees have consistently rated the program as a valuable educational experience that provides participants with the opportunity to meet and talk with a wide variety of gaming law experts and leading state and Native American regulators.

Early Bird Registration ends January 24th. For More Information:  Click Here:

Section 550 of the Bankruptcy Code Won’t Cap the Flow of Avoidance Action Liability

Recently The National Law Review published an article by Renée M. Dailey and Mark E. Dendinger of Bracewell & Giuliani LLP regarding Bankruptcy Codes:

Tronox Incorporated and certain affiliates (the “Debtors”) emerged from Chapter 11 in February 2011 armed with a new capital structure and operational game plan, but that’s yesterday’s news. The flavor of the month is last Friday’s decision by Justice Allan L. Gropper (located here) in a still pending adversary proceeding in the United States Bankruptcy Court for the Southern District of New York (the “Court”) filed by the Debtors against Anadarko Petroleum Corporation and certain affiliates (“Anadarko”) seeking to recover an alleged fraudulent transfer. The Court dismissed Anadarko’s summary judgment motion, holding that while section 550 of the Bankruptcy Code provides a floor for creditor recoveries, it does not impose a cap on creditor recoveries following the determination of avoidance action liability.

In the adversary complaint, the Debtors alleged that in a prepetition transaction their predecessor corporation separated profitable oil and gas exploration and production assets from multi-billion dollar environmental and tort liabilities, in order to permit Anadarko to acquire the cleansed assets all while leaving behind significant environmental liabilities. The Debtors’ extensive environmental liabilities finally caught up with them and in January 2009 the Debtors filed for Chapter 11 protection. The Debtor’s plan of reorganization incorporated a settlement agreement by and amongst the Debtors, the environmental and tort plaintiffs and general unsecured creditors that handed general unsecured creditors the keys to the car (i.e., 100% of the Debtors’ equity) and left the environmental and tort creditors looking for alternate transportation – proceeds from the pending adversary proceeding – as the main source of their recovery. With the adversary proceeding trial starting in May, Anadarko and the Debtors filed competing motions for partial summary judgment on the limited issue of damages. The issue at hand was the interpretation of section 550(a), specifically the clause “for the benefit of the estate” and whether it places a damage cap on prospective fraudulent transfer liability.

By way of background, section 550 prescribes the damages owed by a transferee once a fraudulent transfer is avoided by a bankruptcy court. Specifically, subsection (a) permits the debtor in possession to recover either the value of the property or the property itself “for the benefit of the estate.” 11 U.S.C. § 550(a). In its motion for partial summary judgment, Anadarko argued that this language capped its liability, if any, in the fraudulent conveyance litigation to the total claims of the environmental and tort plaintiffs that would benefit from any fraudulent transfer litigation judgment. Specifically, Anadarko argued that the Debtors were inappropriately seeking to recover approximately $15.5 billion, despite the fact that the total amount of the environmental and tort claims at the time of prepetition transfer of assets was no more than $2 billion. The Debtors, on the other hand, asserted that the plain language of section 550(a) and relevant case law imposed no such ceiling on the Debtors’ potential recovery in the litigation.

The Court found no support for a damage cap in the plain words of section 550, and instead noted that the concept of the bankruptcy estate was broad and not limited to the interests or quantum of claims of creditors. The Court further focused on judicial interpretation of the “benefit of the estate” language and what other courts had determined constituted a “benefit” to the estate in order to permit the litigation to go forward. The Court determined that a “benefit” could either be direct (e.g., increased distribution to creditors) or indirect (e.g., increased chance of a successful Chapter 11 reorganization) and that the prospect of a recovery in the adversary proceeding had already benefited the Debtors’ estate by paving the way for a confirmable plan and raising the recovery for general unsecured creditors. Having established some benefit to the estate that could be (and here had been) obtained by bringing the avoidance action, the Court found no case law support for reading a cap on recovery into the same language. Indeed, the Court noted the significance that section 550 does not provide that a transfer can be avoided only “to the extent of the benefit to the estate.”

Anadarko further argued that because the Debtors relied on Oklahoma fraudulent transfer law – as incorporated by section 544(b) of the Bankruptcy Code – as the basis for a liability determination, the limitation under Oklahoma’s law that a creditor may not recover more than the amount of its claim should apply. The Court rejected this argument noting that such limitation was only relevant where an individual creditor was seeking to recover in a non-bankruptcy scenario and noted that the language of section 550 preempted relevant state law in this regard.

The Court noted that whether other relevant law would mitigate any ultimate finding of liability would require a full trial to drill down on the merits. All that is clear now is that section 550 does not cap the flow of damages from the liability well . . .

© 2012 Bracewell & Giuliani LLP

Cutting Edge Issues in Asbestos Litigation Conference

The National Law Review would like to advise you of the upcoming Perrin Conference regarding Cutting-Edge Issues in Asbestos Litigation:

Thursday, March 1st – Friday, March 2nd, 2012
Beverly Wilshire, A Four Seasons Hotel
Beverly Hills, CA

Public Company Control Alert: NYSE Acts to Further Limit Broker Votes on Specified Corporate Governance Proposals

Recently in Then National Law Review was an article by Louis LehotJohn D. TishlerEdwin Astudillo and Nina Karalis of Sheppard, Mullin, Richter & Hampton LLP regarding the NYSE Limiting Broker Voting:

On January 25, 2012, the New York Stock Exchange issued an Information Memo to its member organizations stating that effective immediately, brokers may not vote on corporate governance proposals supported by company management without instructions from their clients. NYSE’s rules affect the voting of all shares held in “street name” by NYSE member organizations, regardless of whether the vote is for an issuer listed on the NYSE. This new position follows a recent regulatory and legislative trend disfavoring discretionary broker voting. The notification is a significant departure from historical practice where brokers used their discretion to cast votes on behalf of “street name” shareholders who fail to provide voting instructions with respect to what were previously viewed as “routine” matters. The NYSE’s new position will affect the voting dynamics for company-supported governance proposals, including those that companies may put forward this proxy season to avoid shareholder proposals on similar matters.

Background

NYSE Rule 452 allows a member organization (broker) to use its discretion to cast votes on behalf of “street name” shareholders who do not return the proxy card to the broker within 10 days prior to the shareholder meeting. However, such discretionary voting is not permitted with respect to “non-routine” matters. Historically, corporate governance proposals that were supported by company management were considered routine matters. Beginning in 2010, the NYSE prohibited broker discretionary voting in the context of director elections, which was codified in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The Dodd-Frank Act also prohibited brokers from voting shares on executive compensation proposals without specific client instruction. The NYSE’s new position with respect to company-supported corporate governance proposals is the most recent limit on broker discretionary voting. When brokers do not vote a share they hold in street name because of a lack of instructions, it is referred to a “broker non-vote.”

What changed?

The Information Memo indicated the following examples of company-supported governance proposals that would no longer be considered routine:

  • de-staggering a company’s board of directors;
  • majority voting in the election of directors;
  • eliminating super majority voting provisions;
  • providing for the use of written consent;
  • providing rights to call a special meeting; and
  • certain types of anti-takeover provision overrides.

Why is this significant?

Brokers that typically voted in favor of these type of company-supported proposals will no longer have discretion to do so. These proposals usually must be implemented through an amendment to the company’s articles or certificate of incorporation, and as such amendments typically require the affirmative vote of at least a majority of the outstanding shares, broker non-votes will have the same effect as “against” votes. Depending on the composition of shareholders, the loss of broker discretionary votes may have a material effect on the ability of a company to obtain shareholder approval for a company-supported governance proposal. The problem will be exacerbated where a proxy advisory firm recommends against the proposal. Until this rule change, discretionary broker votes countered to some degree the negative votes from holders that followed the recommendations of proxy advisory firms.

Under Delaware law, where brokers have discretionary authority to vote on any matter on the ballot, all shares they hold in street name will be considered present for quorum purposes. If brokers do not have discretionary authority to vote on any matter, shares that were not instructed on any matter are not considered present for quorum purposes. In the past, a company-supported governance proposal would be discretionary and therefore would be enough on its own to cause all street name shares to be present at a meeting for quorum purposes. That will no longer be the case.

What should you do now?

If you plan to have a company-supported governance proposal on your annual meeting agenda, it will be more important than ever to analyze the shareholder base and consider early engagement with key shareholders and the likely recommendations of the proxy advisory firms. Proxy solicitation firms can be invaluable in this analysis, and can also help to “get out the vote” of holders that may not otherwise return instruction cards.

These new rules should also be taken into account in connection with consideration of pre-empting a received or expected shareholder proposal on corporate governance matters.

Finally, if there will be other proposals on the agenda and obtaining a quorum for the meeting is a potential concern, companies might consider another proposal to support a quorum. Ratification of auditors and an increase in authorized common shares are examples of proposals that brokers may still vote uninstructed shares.

Copyright © 2012, Sheppard Mullin Richter & Hampton LLP.

Inside Counsel presents the 12th Annual Super Conference in Chicago

National Law Review is pleased to bring you information about the upcoming 12th Annual Super Conference sponsored by Inside Counsel .

Reasons why you should Attend This Year’s Event:

  1. Meet with Decision Makers: You’ll meet face-to-face with senior-level in-house counsel
  2. Networking Opportunities: SuperConference offers several networking opportunities, including a cocktail reception, refreshment breaks, and a networking lunch.
  3. Gain Industry Knowledge: You will hear the latest issues facing the industry today with your complimentary full-conference passes.

Who Should Attend – General Counsel and Other Senior Legal Executives from Top Companies Attend SuperConference:

  • Chief Legal Officers
  • General Counsel
  • Corporate Counsel
  • Associate General Counsel
  • CEOs
  • Senior Counsel
  • Corporate Compliance Officers

The 12th Annual IC SuperConference will be held at the NEW Radisson Blu Chicago.
Radisson Blu Aqua Hotel

221 N. Columbus Drive

Chicago, IL 60601

Don’t forget – The early discount deadline using the NLR discount code is February 24th!

New Domain Name Registry Application Period Now Open Though Critics Urge Delay

An article by Kathleen E. BlouinLee J. EulgenAntony J. McShaneKatherine Dennis Nye and Sarah E. Smith of Neal, Gerber & Eisenberg LLP regarding Domain Name Applications was recently in The National Law Review:

On Thursday, Jan. 12, 2012, the Internet Corporation for Assigned Names and Numbers (ICANN) began accepting applications from private- and public-sector entities and organizations to obtain nearly any combination of words as their own generic top-level domain name (gTLD) registry. ICANN will only accept applications for new gTLD registries for a 90-day period, concluding on April 12, 2012. The plan will drastically increase the number of available gTLDs from the currently available 22 gTLDs (e.g., .com, .net. and .org) to potentially thousands of gTLDs (e.g., .clothing, .sports, or .yourbrand). With the opening of the application period, public and private sector outcry and dissent concerning the program has started to bubble up to mainstream consciousness.

In particular, the U.S. Department of Commerce has been reviewing the pending expansion after recently obtaining input from numerous sectors of industry regarding the potential shortcomings of the program. In November 2011, an alliance of 87 business groups, organizations and companies wrote a letter to Commerce Secretary John Bryson requesting that the Department urge ICANN to postpone the opening of the gTLD expansion application period. In light of record high levels of domain name dispute filings in 2010, the coalition believes that ICANN should delay implementing the expansion until it can confidently demonstrate that the plan will enhance consumer trust, boost Internet security, create economic benefits across many sectors and show that the benefits outweigh the costs of the expansion. The coalition is led by the Association of National Advertisers and the letter’s signatories include the Intellectual Property Owners Association and the American Intellectual Property Law Association.

In addition, last month, U.S. Representative Bob Goodlatte, Chairman of the House Judiciary Committee’s Subcommittee on Intellectual Property, Competition and the Internet, along with Representative Howard Berman, ranking member of the House Committee on Foreign Affairs, wrote to the Department of Commerce and expressed serious concerns about the dramatic expansion of gTLDs and urged the Department to encourage ICANN to undertake additional evaluation and review before initiating the robust expansion. They relayed concerns that brand owners will be forced to assume significant legal expenses to monitor and protect their trademarks and to obtain defensive registrations in light of an unprecedented number of new top-level domain names. The Representatives argued that consumers will be harmed as many of the legal expenses will be passed on to consumers in the form of higher prices. In addition, they are concerned that, as a result of the expansion, counterfeiting and piracy rates will continue to rise. They encouraged the Department of Commerce to delay the rollout until a sufficient analysis and evaluation is conducted, and until the Department is satisfied the benefits of the rollout exceed the costs and risks to consumers and businesses and to Internet safety and security.

Four commissioners of the Federal Trade Commission (FTC) also sent a letter to ICANN in December urging the delay of the expansion and voicing consumer protection concerns regarding the new gTLDs. The FTC reminded ICANN that ICANN planned to ensure that consumer protection and malicious abuse issues would be adequately addressed. The FTC is particularly worried that the rapid and large-scale expansion will lead to a significant rise in the use of false Whois (domain name ownership) information by domain name registrants, slowing down the FTC’s ability to identify and locate individuals behind fraudulent or counterfeit Web sites. The FTC has proposed a few immediate steps, including the implementation of a gTLD pilot program that would substantially reduce the number of gTLDs accepted in the first application round, and would require ICANN to hire additional compliance staff and impose registrant verification requirements.

Then three weeks ago, just before the Jan. 12 opening of the ICANN application process, a Commerce Department official, Lawrence Strickling, wrote to ICANN regarding some of these concerns. In his letter, Mr. Strickling recognized that the expansion has come after years of preparation and commentary from many stakeholders. However, Mr. Strickling stated that after meeting with industry stakeholders, there is tremendous concern about the expansion that could jeopardize its success. The Commerce Department requested that ICANN take three steps. First, develop a strategy to minimize defensive registrations so that a large number of organizations and entities, concerned about cybersquatting, do not feel forced to obtain defensive gTLD registries (e.g., .theirbrands) without any interest in actually operating a registry. Second, determine whether there is a need to phase in new gTLDs after the application window closes (on April 12th) and evaluate whether additional protection measures are necessary. And, third, better engage with and educate stakeholders as to the purpose and scope of the domain name expansion and available protective resources.

© 2012 Neal, Gerber & Eisenberg LLP.