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Summary of New York’s Freelance Isn’t Free Act

10/4/2024

 
​New York has recently passed new legislation, The Freelance Isn’t Free Act (“FIFA”), which was effective as of August 28, 2024 and is intended to provide certain protections to freelancers and independent contractors.

Freelance Workers and Exceptions

FIFA protects any freelancers that contract to provide services for an amount equal to $800 or more, either for a single project or contract, or for multiple services within a 120-day period.  Certain professionals, including sales representatives, attorneys, medical professionals, and construction contractors, are excepted from FIFA.

Requirements under FIFA

FIFA requires freelancers to be paid on the due date specified in the contract, or if no due date is specified, then no later than 30 days after services are completed.
A hiring party must provide a written contract to the freelancer.  The definition of “hiring party” is broad and includes any small or large organizations, though the federal, state, and local government are exempt.  Contracts must contain:
  1. the parties’ names and addresses; 
  2. an itemized description of all services to be provided, including the value of the services under the contract and the rate and method of compensation; 
  3. the payment date or mechanism by which the payment date will be determined; and 
  4. the date by which the freelancer must provide a list of services to the hiring party to meet any deadlines for the purpose of being compensated.

​The hiring party must keep the contract for six (6) years and present the same upon request of the attorney general’s office.  If the hiring party fails to present the contract when requested, the terms presented by the freelancer shall be presumed to be the terms upon which the parties agreed. 

Anti-Discrimination or Retaliation

​FIFA prohibits the hiring party from discriminating or retaliating against, denying a work opportunity to, threating, harassing, intimidating, disciplining, harassing, or penalizing any freelancer for exercising or attempting to exercise their rights. 

Damages and Penalties

​The attorney general may investigate any alleged violations of FIFA and impose penalties ranging from $1,000 for the first offense to up to $25,000 for repeated patterns or practices of violations.
Freelancers can bring a private action against the hiring party within six (6) years for discrimination and retaliation, as well as nonpayment claims seeking double damages, injunctive relief, and/or reasonable attorneys’ fees.  Alternatively, freelancers can file a complaint with the Department of Labor, which may impose civil or criminal penalties.

Summary of the Proposed Amendments to the Southern District and Eastern District of New York Joint Local Rules

8/12/2024

 
By Cynthia Botello, Esq.¹

This is your chance to help shape the local rules for the New York Federal Civil Courts. On July 8, 2024 the Southern District of New York (“SDNY”) and Eastern District of New York (“EDNY”) issued a Notice to the Bar inviting the public to comment on proposed changes to their Joint Local Rules. Comments are due by October 6, 2024.

Electronic submissions are preferred and can be made through the following links on each court’s website:

  • Eastern District of New York Proposed Amendments
  • Southern District of New York Proposed Amendments

Below is a summary of the proposed changes to the civil rules.²​

Local Civil Rule 1.4. Notice of Appearance; Withdrawal or Displacement of Attorney of Record; Limited‐Scope Representation

The proposed rule codifies the practice of limited‐scope appearances, allowing attorneys to provide legal services for specific tasks. When an attorney and a party agree on such limited-scope representation, the proposed rule requires that the attorney file a notice that outlines the scope of the representation. Notice is not required if the attorney provides short-term services under specific programs, unless those services involve court filings, appearances before a judge, arbitrator, or mediator, or ongoing representation. During any period that a party receives limited‐scope representation from an attorney who has filed a notice of appearance, papers must be served on both the party and the attorney. Limited-scope representation ends automatically when the attorney files a notice indicating the completion of the agreed tasks, which must include a certificate of service to the client. If an attorney wishes to withdraw before completing the tasks, they must follow the withdrawal procedure specified in subsection (b).
​
In addition, the proposed rule provides that when an attorney seeks to withdraw and a new attorney is substituted, an affidavit must accompany the motion if the new attorney plans to request changes to any existing deadlines.

Local Civil Rule 6.3. Motions for Reconsideration

The proposed rule requires that no party file an affidavit unless directed by the court. It also sets new length limits for briefs filed in connection with motions for reconsideration.

For attorney-filed or computer-prepared briefs:
  • Briefs supporting or responding to a motion may not exceed 3,500 words.
  • Reply briefs may not exceed 1,750 words. 
  • These briefs must include a certificate of compliance as required by Local Civil Rule 7.1(c).

​For briefs filed by unrepresented parties, handwritten or typewritten:
  • Briefs supporting or responding to a motion may not exceed 10 pages.
  • Reply briefs may not exceed 5 pages.

Local Civil Rule 7.1. Motion Papers

​The proposed rule revises subsection (4) to incorporate Local Civil Rule 11.1. It specifies the following formatting standards for all documents submitted for filing:

  • Text must be 12‐point type or larger, except for text in footnotes which may be 10‐point type.
  • Documents must have at least one‐inch margins on all sides.
  • Text must be double‐spaced, except for headings, text in footnotes, or block quotations, which may be single‐spaced.  

Additionally, the proposed rule introduces a new subsection (c) to establish default lengths for memoranda of law (subject to a court order or a Judge’s individual practices). The specifics are:

For attorney-filed or computer-prepared briefs:
  • Briefs supporting or responding to a motion may not exceed 8,750 words.
  • Reply briefs may not exceed 3,500 words.
  • These briefs must include a certificate by the attorney, or party who is not represented by an attorney, that the document complies with the word‐count limitations provided above and the typeface, margin, and spacing limitations provided in subsection (a)(4). The person preparing the certificate may rely on the word count of the word‐processing program used to prepare the document. The certificate must state the number of words in the document.

For briefs filed by unrepresented parties, handwritten or typewritten:
  • Briefs supporting or responding to a motion may not exceed 25 pages.
  • Reply briefs may not exceed 10 pages.

These length limits exclude the caption, index, table of contents, table of authorities, signature blocks, and required certificates but include material in footnotes or endnotes. 
​
To the extent the court permits a party to submit briefs longer than these limits, and expresses those limits in pages, each additional page must not contain more than 350 additional words if the brief is filed by an attorney or prepared with a computer.

Local Civil Rule 11.1

Local Civil Rule 11.1 sets minimum legibility standards for documents filed with the Court and permits judges to impose specific formatting or font requirements based on their individual practices. The proposed change involves eliminating Local Civil Rule 11.1 and incorporating its provisions into the revised Local Civil Rule 7.1.

Local Civil Rule 1.8. Electronic Equipment and Recording, Broadcasting, and Streaming of Court Matters

​The proposed rule makes clear courts have the authority to adopt additional policies governing the possession or use of electronic equipment within any courthouse. These policies will be made available on the court’s website or posted within the relevant courthouse.

  1. Reviewed by Ephraim Glatt, Esq. [Return]
  2. A complete redline of these changes can be found here. [Return]

Summary of Amendments to Federal Civil Court Local Rules

6/28/2024

 

By Cynthia Botello, Esq.1

The Southern District of New York ("SDNY") and Eastern District of New York ("EDNY") have adopted various amendments to their joint local rules, effective July 1, 2024 2. While the majority of the changes deal with changes in capitalization (i.e. substituting "court" for "Court") or word choice (i.e. substituting "must" for "shall") other changes are more substantive. Below is a summary of the substantive changes to these rules 3.

Local Civil Rule 1.4. Notice of Appearance; Withdrawal or Displacement of Attorney of Record

The amended rule now requires attorneys appearing in a matter to file a notice of appearance that includes the attorney’s name, any firm or organizational affiliation, business address, telephone number, email address, and the name of the party or parties represented. An attorney that files a case‐initiating document does not need to file a separate notice of appearance.

Moreover, the amended rule eliminates the affidavit requirement for motions to withdraw when another counsel, from the same firm, agency, or organization, who had already appeared in the case, continues to represent the client or when new counsel is substituted by stipulation.

Lastly, the amended rule requires that proof of service on the client must be filed on the docket in each case where withdrawal is sought.

Local Civil Rule 1.6. Duty of Attorneys in Related Cases

The amended rule now requires counsel to comply with the Division of Business Rules, regarding the reporting of potentially related cases.

Local Civil Rule 1.8. Electronic Equipment and Recording, Broadcasting, and Streaming of Court Matters

The amended rule now prohibits, absent specific court authorization, a wider range of items in the courtroom, including electronic equipment, and prohibits the broadcasting or streaming of any proceeding unless authorized by the presiding judge in accordance with Judicial Conference policy.

Local Civil Rule 5.1. Filing of Discovery Materials

This rule, limiting the submission of discovery materials to only relevant portions or excerpts, has been withdrawn. Attorneys should consult Local Civil Rules 37.1, 37.2, and the individual practices of the judge presiding over discovery when seeking or opposing relief under Fed. R. Civ. P. 26 through 37.

Local Civil Rule 5.2. Requirements for Electronic Filing and Service; Duty to Review Underlying Orders

The amended rule makes clear that ECF filing is required unless the filing has been exempted from ECF filing by court order or by Fed. R. Civ. P. 5 and specifies that Highly Sensitive Documents must be submitted in hard copy.

Local Civil Rule 6.1. Service and Filing of Motion Papers

The amended rule makes clear that filing and service of motion papers must be accomplished via ECF, unless the filing has been exempted.

The former subsection (c) of Local Civil Rule 6.1, which was tied to the practice of motions being filed with “return dates” returnable on a judge’s predetermined dates for oral argument, has been withdrawn.

Local Civil Rule 6.3. Motions for Reconsideration

The amended rule imposes page limits on briefs submitted in connection with a motion for reconsideration: principal brief may not exceed 10 pages, and a reply brief may not exceed 5 pages.

Local Civil Rule 6.4. Computation of Time

This rule has been withdrawn. Counsel shall consult Fed. R. Civ. P. 6.

Local Civil Rule 7.1. Motion Papers

The amended rule states that—aside from for applications for extensions or adjournments, applications for a pre‐motion conference, and similar non‐dispositive matters—motions cannot be brought by letter-motion unless authorized by the presiding judge’s individual practices or by an order in a particular case.

Local Civil Rule 15.1 Amendment of Pleadings

This new rule mandates that when counsel moves to amend or supplement a pleading, they must submit to the court and all parties both a clean copy and a redline version of the proposed amended pleading as exhibits to the motion. The motion, if granted, does not constitute a filing of the amended pleading or supplement and, instead, the amended pleading must be filed within seven (7) days of the order granting the motion for leave to amend.

Local Civil Rule 16.1. Exemptions from Mandatory Scheduling Order

The rule was amended to include bankruptcy appeals to the list of cases that are exempt from a mandatory scheduling order under Fed. R. Civ. P. 16(b) and to specify that Freedom of Information Act cases are also included within the scope of the rule.

Local Civil Rule 26.1. Address of Party and Original Owner of Claim to Be Furnished

This rule has been withdrawn in light of the amendments to Fed. R. Civ. P. 7.1.

Local Civil Rule 26.2. Assertion of Claim of Privilege

The amended rule modifies Subsection (b) to provide that although a privilege log should be provided at the time of the response to the discovery request, the parties can agree otherwise in writing.

The amended rule modifies Subsection (c) by adding language that encourages the parties to discuss the type of privilege log to be used and the information fields that should be disclosed, and explicitly recognizes that a categorical or metadata log may be used. Subsection (c)(3) adds that when the parties use a categorical or metadata log, they are encouraged to discuss whether to allow the requesting party to request a document-by-document log for a limited number or percentage of the logged documents. Furthermore, the amended rule modifies the presumption that categorical assertions of privilege are permissible to recognize that the court may stipulate otherwise through the presiding judge's local practices or by specific order.

Local Civil Rule 30.1. Counsel Fees on Taking Depositions More Than 100 Miles From Courthouse

This rule has been withdrawn given both the availability of telephonic and virtual depositions, which do not require travel, and other sources of authority for the court to impose costs in appropriate circumstances, including Fed. R. Civ. P. 26(b)(1)(B) and 45(d)(1).

Local Civil Rule 37.2. Discovery Disputes

The amended rule consolidates specific discovery dispute rules pertaining to the EDNY or SDNY into a unified single rule. Furthermore, the amended rule emphasizes that litigants should consult the individual practices of judges before raising discovery disputes. Additionally, it expands its coverage to include motions for subpoena enforcement under Fed. R. Civ. P. 45.

Local Civil Rule 37.3. Mode of Raising Discovery and Other Non‐Dispositive Pretrial Disputes With the Court (Eastern District Only)

This rule has been withdrawn as Local Civil Rule 37.2 now covers both the EDNY and SDNY.

Local Civil Rule 40.1. Trial Scheduling

This new rule provides that judges have the discretion to schedule trials based on docket requirements, with each district authorized to establish court-wide practices for trial scheduling, prioritizing matters as mandated by federal law.

Local Civil Rule 53.1. Masters

The amended rule removes language relating to the appointment of masters to sit outside the district in light of Fed. R. Civ. P. 53.

Local Civil Rule 55.1. Certificate of Default

The amended rule clarifies the materials that should be filed when a party seeks a certificate of default pursuant to Fed. R. Civ. P. 55(a): (1) a request to enter default; (2) an affidavit; (3) a proposed clerk’s certification of default; and (4) certification of service.

Local Civil Rule 55.2. Default Judgment

The amended rule clarifies the materials that should be filed when a party seeks a default judgment: (1) an affidavit; (2) motion papers (if proceeding by motion); and (3) certification of service.

Local Civil Rule 56.1. Statements of Material Facts on Motion for Summary Judgment

The amended rule provides that a party filing a motion for summary judgment in a case brought pursuant to the Administrative Procedure Act or the Freedom of Information Act no longer needs to file a Local Civil Rule 56.1 statement of material facts.

In addition, the amended rule clarifies that each paragraph in the counterstatement filed by a party opposing summary judgment must admit or deny the truth of the correspondingly numbered paragraph in the moving party’s statement.

Finally, subsection (e) was added to direct moving parties (if all parties are represented by counsel) to provide any statements of material facts in editable word processing format to opposing counsel to allow for the creation of a counterstatement of facts which includes both the moving party’s statement as well as the opposing party’s response thereto.

Local Civil Rule 72.1. Powers of Magistrate Judges

The amended rule includes language intended to grant magistrate judges the full powers available under federal law, whether considered “full-time” or “part-time” magistrate judges.

Furthermore, the amended rule provides that a party may serve and file objections to a magistrate judge’s order on non-dispositive matters, as provided in Fed. R. Civ. P. 72(a). The opposing party may file a response to that objection within 14 days after being served with the objection.

Local Civil Rule 72.2. Reference to Magistrate Judge (Eastern District Only)

This rule has been withdrawn and its contents placed in the Eastern District of New York Division of Business Rules.

Local Civil Rule 73.1. Consent Jurisdiction Procedure

The amended rule includes language intended to more closely conform to the language used in Fed. R. Civ. P. 73 and to more accurately describe how consent forms are distributed and executed.

The amended rule provides that when filing a civil complaint, the parties will receive a court-approved notice or link advising them they can agree to have a magistrate judge handle all case proceedings and final judgment entry. The notice will include a consent form that the parties or their attorneys must sign if they consent to the exercise of dispositive authority by a magistrate judge.

Moreover, if all parties have legal representation, a consent form must be signed by all parties or their attorneys before filing. Consent forms may be signed in counterpart fashion, if all signed forms are filed together.

If both a district judge and magistrate judge are assigned, approval of the consent form by the district judge results in reassignment of the case to a magistrate judge previously designated to receive any referrals or to whom the case has previously been referred for any purpose. In the Eastern District, parties may request random assignment to a new magistrate judge. Furthermore, if no designation or referral has been made, the clerk must select a new magistrate judge at random.

Lastly, the amended rule provides that in the Eastern District, if only a magistrate judge is assigned and the chief judge or designated district judge approves the consent form, the case remains under the magistrate judge's jurisdiction.

Local Civil Rule 77.1. Submission of Orders, Judgments and Decrees

The amended rule eliminates the process for objecting and/or consenting to proposed orders.

Local Civil Rule 81.1. Removal of Cases from State Courts

The amended rule withdraws language suggesting that a party may rely on post-removal discovery to establish jurisdiction.

Local Civil Rule 83.4. Publication of Required Public Notices [formerly Local Civil Rule 83.6]

The amended rule replaces the term “Advertisement” with “Notice” emphasizing that the rule applies broadly to notices.

Local Civil Rule 87.1 Civil Rules Emergency

This new rule was added to supplement Fed. R. Civ. P. 87.

If a Civil Rules Emergency is declared by the Judicial Conference under Fed. R. Civ. P. 87, then the chief judge of the district may issue any order directed toward that emergency that is not inconsistent with that rule. Any order issued by the chief judge under this local rule must terminate upon termination of the Civil Rules Emergency.


  1. With assistance from Patrick Train-Gutiérrez, Esq. [Return]
  2. These amendments apply to actions filed on or after that date or that are currently pending, except in cases where fewer than 14 days remain to perform an action under these rules. [Return]
  3. A complete redline of these changes can be found here. [Return]

The Corporate Transparency Act and New York LLC Transparency Act

3/28/2024

 
​All business owners and investors should be aware of new federal and state legislation that may impact their corporate and business reporting requirements. 

The Corporate Transparency Act (CTA), which went into effect on January 1, 2024, requires all entities to report certain basic information about itself and certain beneficial owner information (BOI) to the U.S. Department of the Treasury Financial Crimes Enforcement Network (FinCEN).  Specifically, any entity formed (or formed in a foreign country and registered to do business within the U.S.) before January 1, 2024 has until January 1, 2025 to file its BOI report.  Entities formed (or formed in a foreign country and registered to do business within the U.S.) after January 1, 2024 have to file that report within 90 days of formation or registration.  Entities formed (or formed in a foreign country and registered to do business within the U.S.) after January 1, 2025 have to file within 30 days of formation or registration.  Failure to file on a timely basis can lead to penalties.

Additionally, New York’s governor recently signed the New York LLC Transparency Act (NYLTA) and its amendments, which goes into effect on January 1, 2026 ¹ and applies to LLCs formed in New York (or LLCs formed outside of New York and authorized to conduct business within the state of New York).  All LLCs formed (or LLCs formed outside of New York and authorized to conduct business within the state of New York) before January 1, 2026 will be required to submit BOI to the New York Department of State by January 1, 2027.  All LLCs formed (or LLCs formed outside of New York and authorized to conduct business within the state of New York) after January 1, 2027 will be required to submit BOI within 30 days of the filing of its articles of organization or application of authority. 

Please see below for more information about the new legislation.  If you have any questions or need further assistance, please reach out to us.

Please also note that an Alabama District Court has ruled that the CTA is unconstitutional.  The federal government has already filed an appeal, and the decision is limited insofar as it only prevents the Treasury Department and FinCEN from enforcing the CTA against the plaintiff and members of the National Small Business Association. 

Which entities are considered reporting companies and are required to file under the CTA?

​Any corporation, limited liability company, or other similar entity that was created (or formed in a foreign country and registered to conduct business in the U.S.) by filing a document with the secretary of state (or similar office) is required to file a BOI report. 

Which entities are exempt from filing?

There are 23 categories of exempt entities, which include large operating entities (gross receipts or sales of over $5,000,000 as shown on its previous year’s tax returns, an operating presence at a physical office in the U.S., and at least 20 employees) and subsidiaries of such companies, certain inactive entities, investment entities, tax-exempt entities, insurance companies, banks, and other regulated entities, and any company whose ownership interests are 100% owned by exempt entities.  

Who are the beneficial owners of a reporting company?

The beneficial owners of a reporting company are any individuals that either (i) directly or indirectly exercise substantial control over the reporting company or (ii) directly or indirectly own at least 25% of the ownership interests in the reporting company.  An individual has “substantial control” when they (i) are a senior officer; (ii) are able to appoint or remove senior officers or a majority of the directors of the reporting company; (iii) are an important decision maker at the reporting company; or (iv) have any other form of substantial control over the reporting company.  Examples of individuals who have substantial control over a reporting company include but are not limited to CEOs, CFOs, general counsel, board members, and managers (including someone who controls an intermediary that exercises substantial control over the reporting company).  Ownership interests include but are not limited to stock, equity, capital or profit interests, or any instrument that confers voting rights.  There are also certain narrow exceptions where someone who would normally qualify as a beneficial owner is exempt from providing BOI. 

What information will I need to provide on my BOI report under the CTA?

​A BOI reporting company will need to report the company name and address, jurisdiction of formation, and EIN.  Each beneficial owner will need to provide their name, date of birth, and current residential address, along with an image of a non-expired permitted identification, which includes a U.S. passport, state driver’s license, identification document issued by a state or local government, or foreign passport.  Any information reported that changes or is inaccurate, including but not limited to changes in a reporting company’s beneficial owners and their names or their residential address, changes to its officers, or registering a new DBA needs to be promptly updated within 30 days after the change occurs or the reporting company becomes aware or had reason to know about the inaccuracy.  Additionally, up to two people or companies who file and/or direct the filing of the formation documents of any reporting company formed (or registered to conduct business in the U.S.) on or after January 1, 2024 need to submit certain personal information along with the reporting company’s BOI report.

What is a FinCEN Identifier?

​A FinCEN identifier is a unique identifying number issued by FinCEN.  An individual beneficial owner can receive a FinCEN identifier that can be used in place of providing BOI.  Reporting companies can request a FinCEN identifier while completing its BOI report.

What is a company applicant and does my company need to report its company applicant?

​A company applicant, which can only be an individual and not a company, is either (a) a direct filer (i.e., the person who directly filed the documents to create the company or registered to conduct business in the U.S.) or (b) a person who directs or controls the filing.  A reporting company that is required to provide company applicant information would have at least one but no more than two company applicants.  Only reporting companies formed (or registered to conduct business in the U.S.) on or after January 1, 2024 must report the personal information of company applicants on its BOI report (reporting companies formed prior to that date to do not need to provide company applicant information).  A company applicant can obtain a FinCEN identifier and use that in place of providing personal information as well.

What happens if my company does not file a required BOI report to FinCEN?

​Anyone who violates or willfully fails to comply with BOI reporting requirements (including but not limited to failing to file or update a BOI report and willfully providing or attempting to provide false or fraudulent BOI) may be subject to civil penalties of $500 (adjusted annually for inflation; the 2024 rate is $591) for each day that the violation continues and criminal penalties of imprisonment for up to two years, a fine of up to $10,000, or both.

Are there any differences between the CTA and the NYLTA?

While there are similarities between the new laws, such as the same reporting company exemption categories, there are some key differences between the CTA and the NYLTA:
​
  • The NYLTA will be state law that only requires LLCs formed in the state of New York or foreign LLCs authorized to conduct business in the state of New York to register BOI. 
  • BOI reported under the NYLTA is filed with the New York Department of State, not FinCEN.  
  • LLCs exempt under the NYLTA must file an attestation of exemption, under the penalty of perjury, which shall include the specific exemption claimed and the facts on which such exemption is based.
  • Company applicant information is not required to be provided under the NYLTA. 
  • Under the NYLTA, reporting companies must update any changes or inaccuracies with reported information on an annual report confirming, among other things, its BOI.  
  • There are no criminal penalties for noncompliance with the NYLTA (only civil penalties, including a fine of up to $500 per day the LLC is past due, the disclosure being shown as past due on the LLC’s DOS records, after two years, being shown as delinquent and requiring payment ($250 plus $500 per day that the LLC is delinquent) to remove the delinquency, and possible dissolution or cancelation of the LLC).

1. There have already been amendments to the NYLTA and there may be further amendments before it goes into effect.

Cryptocurrency Bankruptcy Issues

12/23/2022

 
There has been recent turmoil in the crypto market, including a host of Chapter 11 crypto filings.  In the event that you or your clients need legal support during these challenging times in the industry, we are well-positioned to assist.  We have extensive experience providing crypto and fintech clients with a broad range of legal services, including:
​
  • distressed situations, including crypto bankruptcy cases such as Voyager’s Chapter 11 and out-of-court restructurings and transactions involving crypto companies;
  • civil litigation and arbitration, including representing crypto companies and exchanges with respect to claims for fraud, breach of contract, and misrepresentation; customer disputes; and class actions in federal and state courts throughout the United States;
  • regulatory enforcement defense, including defending crypto companies in inquiries, investigations, and litigation brought by the SEC, CFTC, and state regulators with respect to unregistered offerings, fraudulent crypto schemes, and inadequate disclosures; and
  • regulatory and compliance advice, including token analysis; product and business-line risk assessment and mitigation; money transmission licensing; evaluating and drafting KYC/AML/SARs policies and procedures; federal and state examinations; and evaluating and drafting cybersecurity policies and procedures and data privacy and protection disclosures.

Bankruptcy and non-bankruptcy options for distressed companies

9/29/2018

 
​In this article, we present a summary of the options available to companies in financial distress, including a discussion of the advantages of, and treatment of small businesses under, Chapter 11 of the Bankruptcy Code.

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Intellectual property issues in bankruptcy

9/29/2018

 
​Most bankruptcy attorneys will confess that they delight in telling the non-bankruptcy attorney for the other side that a bankruptcy case has been filed and that a contractual termination provision or other right governed by state law is suddenly superseded and rendered superfluous by the Bankruptcy Code, 11 U.S.C. § 101 et seq., which is federal law. In other words, my law trumps your law.
​
When bankruptcy law and the policy considerations underlying it intersect (or collide) with intellectual property law, which is also primarily federal law and is based on its own compelling (and often competing) set of policy considerations, the analysis becomes much more complex. This article explores the attempts by Congress and the courts to resolve the issues that arise when intellectual property license agreements become part of a bankruptcy estate and describes the protections that may be available to, and the pitfalls that should be avoided by, licensors and licensees.

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Bankruptcy litigation

9/29/2018

 
The bankruptcy court provides a forum for the prosecution of a variety of lawsuits. The most common complaints filed by or on behalf of a bankruptcy estate are for the avoidance and recovery of preferential transfers and fraudulent conveyances (under both the Bankruptcy Code and state law).

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Bankruptcy basics

9/29/2018

 
​Chapter 11 of the Bankruptcy Code is federal statutory law. If a financially distressed company is seeking to continue to operate and emerge from bankruptcy as a new and improved company, while maintaining the option of selling off its assets in an orderly fashion, it would file Chapter 11. If it has no choice but to liquidate it may file Chapter 7, in which case a trustee is appointed to sell off the assets.

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