Commercial, Corporate, and Contracts

imageA tough clause to beat

A little over two years ago, the Supreme Court held that judges must enforce forum-choice clauses in the absence of “extraordinary” reasons “unrelated to the convenience of the parties”. Atlantic Marine Construction Co., Inc. v. United States District  Court for the Western District of Texas, 134 S. Ct. 568, 580 (2013).

On the day that  the 9-0 Court handed down Atlantic MarineI wrote that it “will bring joy to firms that put [the] clauses in their contracts in hopes of making lawsuits too costly to pursue.”

Has the case borne out my forecast of joy?

Yes. Yes indeed.
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12+ years

In its more than 12 years of life, the case of Comcast Corp. v. Behrend has offered dozens of chances for the lawyers to persuade — or not.

Although class counsel suffered a tough 5-4 defeat in the U.S. Supreme Court, we convinced judges often enough to eke out $35 million in cash, bill credits, and services for the Philadelphia-area class.

Class plaintiffs prevailed mostly because we had the better side of the issues. But we also did a better job of earning the trust of the decision-makers we appeared before — the district judges in Boston and Philadelphia, appellate judges on the First and Third Circuits, and even justices of the Supreme Court.

Let me give you a few reasons for my view.
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imageExposure

A U.S. appeals court judge told me a few years ago that private contracts between businesses should call for settling disputes through bench trials rather than by arbitration.

But neither the judge nor I thought to mention a factor that may matter more than the relative quality of justice in courts versus private arbitration. As a recent 2-1 ruling by the Ninth Circuit just reminded us, federal courts strongly favor public access to case records — even if the records include deeply embarrassing documents that a party produced in discovery.
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imageBring your checkbook

Today resumes the series on take-aways from the epic case of Comcast Corp. v. Behrend — an antitrust class action that began more than a dozen years ago, produced dozens of opinions, and survived a loss in the U.S. Supreme Court before ending in a $50 million settlement, the benefits of which class members started receiving last month.

Today’s lesson underscores a harsh reality — and one that critics of class actions tend to forget: Class actions cost class counsel not only their time but also their money, potentially large quantities of it.
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Handshake with TearLast Thursday, the Association for Corporate Growth hosted a talk in Dallas about deals that result in a lawsuit or arbitration. Several dozen deal-makers, mergers and acquisitions lawyers, and consultants attended. The Honorable Jeff Kaplan of JAMS, Elizabeth Brandon of Vinson & Elkins, and I gave the talk. Ladd Hirsch of Diamond McCarthy organized and moderated the event. In a little over an hour, we discussed the characteristics that commonly occur in transactions that produce formal claims, offered suggestions on how deal-makers can manage the risk of earl disputes, and answered several thoughtful questions from the audience. I enjoyed the session immensely. Please see my review of the lively discussion below.
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imageThe Third Circuit’s decision in In re Avandia Marketing, Sales Practices & Product Liability Litigation, No. 14-1948 (3d Cir. Oct. 26, 2015), accepts a path-breaking fraud-on-the-intermediary theory under the Racketeer Influenced and Corrupt Organizations Act of 1970 (RICO), which allows you to recover three times your actual damages plus reasonable attorneys’ fees. Expect more cases like this.
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