Arthur R. Lehman, L.L.C.

New York Business Litigation Blog

A short introduction to trademark law

Trademark law is one area of intellectual property law that involves huge numbers of people and companies. Not every Manhattan business person has a patent or a copyright, but many do have a trademark that represents their business in the eye of the public and that they wish to defend vigorously. Our readers should familiarize themselves with an introduction to trademark law.

A trademark is used in commerce to distinguish the goods of one company from those of another. A trademark can include a name, symbol, word or device or a combination of these. A similar concept exists for service providers, except that the name, symbol, word or device is called a service mark. Brand names and symbols associated with brands can be trademarks or service marks.

When is breach of contract a "material breach"?

New York businesspeople rely on their customers, clients and vendors to keep their promises or to renegotiate agreements if the current ones are not working out. These promises and agreements are called contracts, and our legal system recognizes the importance of these contracts and the importance of the parties adhering to them. When at least one contract term has been violated by a party, the contract is said to have been breached. But, how do courts respond to contract breaches?

If one party performs a duty under a contract but performs it later than it is supposed to, the contract has probably been breached. Can the other party recover damages as a result of this breach of contract? It depends. Let's say a construction supplier is supposed to provide materials to a contractor by close of business on a Wednesday. The materials are instead provided on Thursday morning. Unless the contractor can show that it suffered monetary loss as a result of the breach, the breach will probably be considered immaterial, and the contractor probably won't be able to recover damages.

What is breach of fiduciary duty?

Many successful Manhattan business relationships are built on trust. When parties feel that they can trust each other, they may have the confidence necessary to form mutually beneficial commercial relationships. On the other hand, if parties do not feel that they can trust each other, the overall business climate can be negatively affected. This is why the victims of these breaches of trust can often have recourse to our legal system to seek damages for their losses.

One kind of breach of trust that our legal system recognizes is breach of fiduciary duty. A fiduciary duty is an obligation to act in the best interests of another party. For example, if an attorney is entrusted with client funds, that attorney has a fiduciary duty to the client. The attorney is required to act in the best interests of the client with regards to the stewardship of the money.

Federal Court in New York allows Instagram case to move forward

It seems like people in New York these days have a myriad of ways in which to capture their artwork. Gone are the days when paintings were made on blank canvases and photographs were taken with film and later developed. Digital photos these days can be taken with a smartphone and shared on a variety of platforms. However, this could lead to legal issues, as one recent case shows.

Recently, a federal judge in New York allowed a photographer's legal claim against artist Richard Prince to move forward. The photographer's claim arose over an image that the artist used as part of an exhibition. The case will determine how the doctrine of fair use applies to digital apps that allow users to share photographs, such as Instagram.

Negotiation and litigation in contract disputes

Whether it's a simple sale of goods or a complex and critical merger or acquisition, the business of most Manhattan companies is ruled by contracts. In the vast majority of cases, business people either adhere to the contracts they have made or successfully renegotiate new arrangements with their suppliers, customers and merger or acquisition partners. Although most business people would prefer to avoid business disputes if possible, they are sometimes unavoidable, and it is important for business people to take action to protect their rights.

Not long ago, a recent post here described a business dispute that erupted between two major health insurers. They had signed a merger agreement, but the federal government had filed a lawsuit to halt the deal on antitrust grounds. One health insurer then sued the other, claiming that it had breached their contract by not adequately preparing for the antitrust litigation with the government.

Helping employers and employees with intellectual property issues

When drawing up employment contracts, employers in New York naturally want to include provisions protecting their intellectual property. This is why many employment contracts limit the rights of employees to accept certain positions with certain other employers soon after leaving the employment of the contracting employer. Employees, on the other hand, may determine that these non-compete clauses are not enforceable or are not applicable to their specific circumstances.

What rights and powers are granted by employment contracts?

Many employees in Manhattan, and even some employers, may assume that most employment arrangements are governed by employment contracts in addition to employment law. The reality is that most employment relationships can be categorized as employment "at will," meaning that the employee can be terminated for any reason not expressly prohibited by employment law or civil rights law. However, some employment relationships are governed by an employment contract, and it is common for these contracts to limit the power of the employer to fire the employee.

A common provision of an employment contract is that the employee can only be terminated for "good cause." Courts have interpreted "good cause" to refer to purely business needs. For example, if an employee has poor work performance, low productivity or is frequently late or absent, the employer may have good cause to fire the employee. Threats of violence, disruptiveness, endangering co-workers and the commission of illegal acts are other possible examples of good cause to discharge an employee.

Employees push back against mandatory arbitration clauses

Many contracts in the modern business world contain clauses requiring that disputes about the contract must be submitted to binding arbitration. When the parties to the arbitration proceeding are both large, well-funded corporations, the arrangement is usually deemed to be fair to both parties. When, however, the clause appears in an employment contract, the parties may be manifestly unequal, a large corporation versus one or more employees. Recently, lawyers who engage in employee representation have begun to push back against such provisions.

These cases were shoved into the public spotlight when Gretchen Carlson, a TV news anchor for Fox News, sued Roger Ailes, the company's president at the time, in New Jersey state court, alleging sexual harassment. Ailes removed the case to federal court in New York and filed a motion seeking binding arbitration of all issues in the case. The parties settled the case before the judge ruled on the motion.

Alternative dispute resolution can save you both time and money

Legal disputes involving your New York business are a threat to your livelihood and the future of your company. While it is critical to resolve these issues quickly and efficiently, it is not always necessary to resort to litigation to reach a beneficial outcome. In some cases, alternative dispute resolution could be a better way to move past certain types of complications.

There are various types of alternative dispute resolution that may be beneficial for you and your business. Avoiding litigation will not only help save you time, it could be more cost-efficient than fighting for a resolution in court. While litigation may sometimes be necessary, it is not always the only option.

Macy's sues Burlington, former executive over trade secrets

New York-based Macy's Inc. has begun a lawsuit against its competitor, Burlington Stores, Inc., to prevent one of its former vice-presidents from working for Burlington. The complaint alleges that Burlington hired one of Macy's key executives to obtain access to its trade secrets and proprietary and confidential information. The executive has counter-sued Macy's to obtain a declaratory judgment that her employment contract with Macy's does not prevent her from working in her new position with Burlington.

The Macy's employee, who served as executive vice president and regional director of stores in Macy's north central region, resigned in April to accept a position at Burlington as senior vice president of stores. Macy's alleges that the former executive was bound by a contract that contained non-compete, non-solicitation and non-disclosure provisions and that the position at Burlington will require her to violate these clauses. The complaint also alleges that Macy's informed both Burlington and the vice-president that it would enforce the terms of these agreements.