Main | September 2004 »

June 2004 Archives

June 1, 2004

Does Your Business Need Trademark Protection?

With most businesses, trademarks and copyrights have become an integral part of company assets and goodwill. No longer is a mark or logo just a symbol of a company. Names and logos are now assets attaining goodwill and providing name and/or product recognition and revenue. Most companies are familiar with the concept of a trademark. This is due in part to the company widely utilizing its name for recognition within the industry and with clients. Unfortunately, the majority of companies have not properly protected their trademarks and as a result, these companies are not utilizing valuable statutory protections. Similarly, literary and/or visual arts works are often not protected to the fullest extent of the law, again causing a lapse in copyright protection for an entity's assets.

If your registered mark is used illegally by others, statutory damages are available. By statute, any unlawful distribution, reproduction, or manufacture of a registered trademark or copyright, provides the owner with the option of seeking actual damages and statutory damages. Statutory damages can be anywhere from $500 to $20,000 for a simple violation to up to $100,000 for a willful violation. The court can also assess court costs and attorney fees. More likely than not, the statutory damages and attorneys fees well outweigh any actual damages.

Don't hesitate to take appropriate legal steps to protect your company's trademark.

June 3, 2004

Contract Provisions: More Than a Handshake

As a business owner you must always remember that executing a written contract with key provisions is the most essential element in a successful business transaction. The best way to prevent a dispute in any transaction is to have the parties intentions reduced to writing.

Once a dispute has arisen, it can be very costly, frustrating, time-consuming, inconvenient and difficult for parties to agree on a resolution. Thus, no matter what type of business transaction is being contemplated, a written contract with well-crafted provisions to protect your company's interests is absolutely necessary. Although, some business transactions may be fairly simple, a missing key provision can lead to litigation costing more than the business transaction itself. On the other hand, a relatively complex business transaction can go awry if the provisions that are included happen to be vague, ambiguous, or incomplete.

The Hazard of Form Contracts
Knowing you need a contract and living in today?s information age, you may be tempted to download a form contract from a website. Although convenient, such contracts may not always be the smartest decision for a business-owner. Occasionally, for a simple business transaction, a form contract may suffice; however, there are a few major problems with form contracts you need to keep in mind.

First, the biggest flaw with form contracts is that they are extremely generic. A form contract may not necessarily conform to the state's laws in which the transaction is taking place. Certain provisions may be unenforceable under state law which could make the entire contact unenforceable.

Second, a form contract may not completely and clearly express the true intention of the parties. It will contain generic provisions, but it will not contain the specific clauses that are peculiar to the business transaction. A party may add specific language to express the true intention of the parties; however, once again, the language that is added may be vague, ambiguous, or incomplete.

Finally, with a form contract that has specific language added to it, the party who adds the language is in a very vulnerable position in the event there is a contractual dispute. Contract law states that any ambiguity or vagueness in a contract is interpreted by the Court against the party that drafted the contract. Thus, this may lead to an unfavorable interpretation against your company if you drafted the contract or provided the form.

Therefore, in any business transaction, it is absolutely necessary to finalize the parties' agreement by executing a well-drafted written contract. It is fundamental to have the necessary contract provisions to protect your economic interest at stake. With the assistance of an attorney who has experience in drafting and negotiating business contracts, a business-owner can be assured that many potential problems may be avoided, such as, delivery of non-conforming or untimely goods, responsibility for attorney's fees, excessive damages with no limitation of liability, an unfavorable state's choice of law, or an inconvenient venue to litigate the dispute. Ultimately, all of these issues will result in costly and lengthy litigation that may have been preventable from the onset by just adding the key provisions.

June 9, 2004

Employee Handbooks: Employer's Best Defense or Employee's Smoking Gun?

The biggest concern for most employers is the proverbial bottom line. Employers should, however, be aware of their potential for becoming embroiled in litigation that may end up costing them thousands of dollars. In addition, the Equal Employment Opportunity Commission (EEOC) is always looming on the horizon, ready to enforce the laws under its purview; namely, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act (ADEA) of 1967, the Equal Pay Act (EPA) of 1963, Titles I and V of the Americans with Disabilities Act (ADA) of 1990, sections 501 and 505 of the Rehabilitation Act of 1973, and the Civil Rights Act of 1991. In the 2002 fiscal year, 84,442 charges were filed with the EEOC, which was a 5% increase from the previous year. The EEOC awarded a staggering 310.5 million dollars to victims of discrimination in the 2002 fiscal year. Fortunately for employers, Ohio courts continue to uphold the employment-at-will doctrine, which basically states that an employee, not under an employment contract, may be terminated at any time, with or without cause. This doctrine, however, does not give employers carte blanche to terminate employees when that termination may run afoul of state or federal anti-discrimination laws.

Despite employers' continued reliance on the employment-at-will doctrine, the Supreme Court of Ohio has issued several decisions in the recent past that have chipped away at this doctrine. Most notably, there are four major exceptions to the employment-at-will doctrine: express contracts, implied contracts, promissory estoppel, and public policy. Each of the aforementioned exceptions can transform an employee-at-will to a contract employee who may only be terminated for cause. When terminating for cause it is critical to have maintained detailed employment records.

Employee Handbooks
Well written policies in an employee handbook may serve as a shield to help employers deflect potential lawsuits by employees; however, employers run a tangible risk when issuing employee handbooks since a poorly written handbook may provide an employee with a sword with which to pierce the employment-at-will doctrine and/or prove a discrimination claim. A poorly drafted handbook may be all an employee needs to succeed with a wrongful discharge claim, and a well crafted handbook may be all an employer needs to head off a lawsuit or investigation by the EEOC or OCRC. There is no law in Ohio which requires an employer to maintain or issue an employee handbook, but they do provide many advantages to employers. Employee handbooks allow an employer to present its employees with company policies and procedures. A handbook may also aid management in uniformly implementing and enforcing these policies, and uniformly and consistently enforced policies can be an employer's best defense against a wrongful discharge lawsuit.

The most important component of any employee handbook is the disclaimer. The disclaimer should state clearly the handbook is not an employment contract, in no manner guarantees continued employment, and that the employee is an at-will employee who may be terminated at any time and for any reason. In addition, the disclaimer should state that the policies and procedures contained in the handbook are intended as guidelines and the employer may unilaterally modify the policies and procedures at any time. Placing the disclaimer on the initial pages of a handbook is recommended since courts have found that inconspicuously posted disclaimers may not properly inform employees of their at-will status.

The actual policies and information contained in a handbook will vary depending on the characteristics of each company such as size, field of operation, and whether employees are union members. Generally, topics such as benefits (holidays, vacation, health, insurance, etc.), attendance and leave policies, dress codes, computer policies, copyright and trade secret policies, drug and alcohol policies, and discipline appear in employee handbooks. Employers may also want to include some background information on the company such as its history and its expectations for the future.

If an employer is covered by the Family Medical Leave Act (FMLA) and provides an employee handbook, it must include information relating to the FMLA and employees' rights under the statute. Handbooks should provide information regarding who is eligible for protected leave, what leave qualifies for protection, the employer's notice procedures for FMLA leave, and how the employer will calculate the 12-month period under the FMLA. If the employer requires employees to use paid vacation or sick leave prior to FMLA protected leave that must be included in the handbook.

An employer who includes a list of offenses for which an employee may be terminated should be cautious in wording its discipline and discharge procedures so that a court cannot later determine that an employee could not be terminated for an offense not specifically enumerated. To prevent this, employers should be clear in stating that any list of offenses that warrant termination is not exhaustive and the employer reserves the right to terminate an employee at any time within its discretion. Also, an employer implementing progressive discipline procedures should maintain flexibility to deviate from the procedures if appropriate.

About June 2004

This page contains all entries posted to News & Events in June 2004. They are listed from oldest to newest.

September 2004 is the next archive.

Many more can be found on the main index page or by looking through the archives.

Powered by
Movable Type 3.35