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© 2016 Zuckerman Spaeder LLP

“Some But Not All”: Delaware Court Awards Advancement to Former Officer, But Only for Part of a Case

When a former officer or director of a company must defend against legal claims, advancement of legal fees by the company can be critical to a successful defense. The Delaware Chancery Court frequently addresses issues related to advancement of fees for former officers and directors. For example—as we discussed in this post—that court recently resolved a claim by former Vice President Al Gore and a colleague for advancement of legal fees, ruling that they were entitled to advancement from the company that bought their employer (Current Media) and assumed Current Media’s indemnification and advancement obligations, even though they had never worked for the purchaser Read More ›

Employee’s Remote Storage of Employer Documents Results in Post-Termination Trouble

What happens when an employer tries to change the basis for terminating an employee?

Recently, the Supreme Judicial Court of Massachusetts considered whether an employer could change the basis for the termination from “without cause” to “with cause” and withhold severance benefits otherwise owed the former employee. In EventMonitor, Inc. v. Leness, the employee won the battle, but the cost may have consumed the spoils of war. Read More ›

The Clock is Ticking: Supreme Court Rules on Statute of Limitations for Constructive Discharge

Last week, the U.S. Supreme Court issued a plaintiff-friendly decision resolving disagreements over the question of when a constructive discharge claim accrues. The lower courts didn’t agree on when the clock should start ticking on claims by employees that they were forced to quit, creating uncertainty for plaintiffs who faced the possibility that their claims would be barred by the statute of limitations if they didn’t sue soon enough. Read More ›

Yates Update: Deputy Attorney General Remarks on Reaction to Memo

When the Department of Justice announces new guidance for individual and corporate prosecutions, the white collar bar takes notice.

Thus, in September 2015, when the Department of Justice released a memorandum titled “Individual Accountability for Corporate Wrongdoing”—now colloquially known as “the Yates Memo” because it was authored by Deputy Attorney General Sally Yates—almost everyone had something to say about it.

The Yates Memo seeks to increase the emphasis on individual accountability for corporate wrongdoing from the outset of a government investigation. It sets forth six steps to strengthen pursuit of individuals by criminal and civil prosecutors, including requiring corporations to lay out all relevant facts related to individual misconduct in order to obtain cooperation credit. Read More ›

After a Merger, Protecting Rights to Advancement and Indemnification

For both companies and individual officers and directors, it’s critically important to know the protections that are available to corporate leadership before a company runs into trouble.

The Delaware Chancery Court’s recent decision in Hyatt v. Al Jazeera America Holdings II, LLC, presents an unusual twist on the typical advancement litigation. It highlights how proper planning can ensure the intended protections are available when they are needed.

Typically, advancement cases follow a familiar pattern: a company promises officers and directors (and sometimes employees) that in the event of legal proceedings related to their duties at work, they will be protected by advancement of legal costs and indemnification. Read More ›

The Inbox – An Unexpected Treat

As employees of the New York-based Chobani yogurt plant filed into work last Tuesday, they were met with sealed, white envelopes containing a sweet financial surprise. 

Little did they know, the owner and CEO, Hamdi Ulukaya, had been working with the human resources consulting firm, Mercer, to hatch a plan to transfer 10 percent of his stock in the company to roughly 2,000 full-time employees. Read More ›

Employer’s Failure to Sign Agreement Torpedoes Its Motion to Compel Arbitration

A fundamental principle of contract law is that a written contract is an agreement in writing that serves as proof of the parties’ obligations. What happens, however, when the parties forget some of the niceties of formalizing a written contract?

For one answer, consider the recent decision in the case of Shank v. Fiserv, Inc., in which the Eastern District of Pennsylvania addressed Fiserv’s motion to dismiss and compel arbitration at the outset of the case. Read More ›

Kagan’s Luis Dissent Suggests Way for Defendants to Strike Back

In our last post, we discussed the recent decision Luis v. United States, in which the Supreme Court held that innocent assets are out of the government’s reach prior to trial. Justice Elena Kagan’s short but notable dissent in Luis addressed the issue of whether the government should be able to reach a defendant’s assets at all, allegedly “tainted” or not, prior to conviction. Read More ›

Hands Off! Supreme Court Rules Defendants May Use Innocent Assets to Hire Lawyers

Every defendant is presumed innocent until proven guilty in a court of law. And the Sixth Amendment to the Constitution provides a defendant has the right to counsel of his or her own choosing. These rights are foundational to our criminal justice system.

However, prior to the Supreme Court’s decision yesterday in Luis v. United States, the government was able to undermine these basic rights. In cases involving conspiracy, healthcare fraud, and banking fraud, federal statutes allowed the government to seek a pretrial restraining order preventing defendants from using their innocently obtained assets to retain counsel. Read More ›

Five Things You Should Know about the EEOC’s Proposed Changes to the Employer Information Report

Employers with an eye to the regulatory horizon are aware that the Equal Employment Opportunity Commission (EEOC) has proposed expanding its annual Employer Information Report (EEO-1) to include data on employees’ pay.

The existing EEO-1 requires private employers with 100 or more employees to report the number of employees within 10 job categories by seven race and ethnicity categories, as well as by sex.

The proposed changes will further refine reporting to include employee counts as well as total hours worked by 12 pay bands. Read More ›