Wednesday, March 21, 2018
Slate has a piece analyzing the enforceability of the liquidated damages provision in Stormy Daniels's contract with Donald Trump, quoting several very keen legal minds. (Disclaimer: including mine ;-))
Monday, March 19, 2018
A recent case out of the Southern District of Texas, Henderson v. A & D Interests, Inc., Civil Action No. 3:17-CV-096, deals with arguments regarding illusory promises and unconscionability.
The plaintiffs were exotic dancers at the defendant's adult entertainment club. They sued and the defendant moved to compel arbitration pursuant to the agreement between the parties. The plaintiffs argued that the agreement was unenforceable because it was illusory. The relevant termination provision allowed either party to terminate "at any time with or without notice." Because the termination provision provided such rights to both parties, the court found it wasn't illusory and the agreement was enforceable.
The plaintiffs also argued that the arbitration provision in the agreement was unconscionable because it required the parties to split the cost of the arbitration, which the plaintiffs argued would be prohibitive. However, the court found unpersuasive the plaintiffs' evidence on the estimate of the cost of the arbitration, and there was no evidence of the plaintiffs' ability to pay for an arbitration at the time they agreed to the provision, which to the court was the relevant moment.
Friday, March 16, 2018
There's a class action going on over data breaches at Yahoo! between 2013 and 2016, and a recent decision in the case in the Northern District of California, In re: Yahoo! Inc. Customer Data Security Breach Litigation, Case No. 16-MD-02752-LHK (behind paywall), finds that Yahoo!'s limitation-of-liability provisions have been adequately pled to be unconscionable.
The provision at issue was found in Yahoo!'s terms of service and attempted to limit Yahoo!'s liability. The class action sought consequential damages, and Yahoo! moved to dismiss the claims for those damages, citing the provision. However, the plaintiffs argued that the provision was unconscionable, and the court agreed that they had sufficiently pled their argument to survive the motion to dismiss.
In terms of procedural unconscionability, Yahoo!'s terms of service were a non-negotiable adhesion contract, and the limitation-of-liability provision was found near the end of its twelve pages. The fact that the plaintiffs could have chosen other email services did not bar a finding of procedural unconscionability.
As far as substantive unconscionability goes, the plaintiffs alleged that the limitation-of-liability provision was one-sided and acted to block the plaintiffs from achieving adequate relief. The provision prohibited nearly every type of damages claim, virtually guaranteeing that the plaintiffs would not be able to be made whole in the event of a breach. In this case, consequential damages generally follow from data breaches, so the plaintiffs argued that consequential damages were necessary for their case. Finally, the plaintiffs argued that the only party in a position to guard against data breaches was Yahoo!, yet the limitation-of-liability provision placed the risk on the plaintiffs should Yahoo! fail to maintain adequate security.
Thursday, March 15, 2018
The New York Times reports that an upcoming Broadway production of "To Kill a Mockingbird" is embroiled in a contract dispute. The new production features a script by Aaron Sorkin, governed by a contract that requires it to keep to "the spirit of the Novel." Author Harper Lee's estate believes the play's new script has breached this contract provision.
The crux of the disagreement seems to be that Sorkin's script apparently updates the novel's depiction of racial politics and shifts Atticus Finch's developmental arc. Atticus, well-known as the crusading heroic lawyer at the center of the novel, apparently begins the play "as a naive apologist for the racial status quo" who eventually develops into the Atticus familiar from the novel. Sorkin in an interview described Atticus as evolving in part through interactions with a black character, Calpurnia, whose role Sorkin had expanded in the play as compared to the book.
Lee's estate is objecting to the "massive alteration" of the novel, but the play's producers contend that, although the play is "different" from the novel, it is still true to the novel's spirit, pointing out that Lee's novel's universe was itself expanded and complicated by the recent publication of "Go Set a Watchman," in which an older Atticus is portrayed as a racist and segregationist.
As anyone who's sat in an English class might agree, "the spirit of a novel" is rather vague and can be the source of much contentious disagreement. Literature can be a very personal experience, and what stands out as the vitally important part of a novel to one person can barely register to another. We could probably as a society reach a consensus on what "the spirit" of "To Kill a Mockingbird" might be, but I still don't think that would be of much assistance in resolving this dispute. There are, I think, two approaches to adapting a novel, and one is a requirement to be faithful to the letter, and the other is to be faithful in a more abstract way. I suspect that both parties here actually agree about what the spirit of "To Kill a Mockinbird" is but that Lee's estate believes the former approach to adaptation to be the only acceptable one, and that the producers of the play believe the latter to be acceptable. This reminds me of a recent New Yorker article on the proper role of translators.
(As an unabashed fan of Sorkin's writing, as soon as I read the first paragraph of the article, I have to admit my reaction was: "Let me guess, the script sounds like Aaron Sorkin instead of Harper Lee." I haven't seen the script, of course, but there are few writers in my experience whose style is as instantly recognizable as Sorkin's.)
Sunday, March 11, 2018
I have the great honor and pleasure of posting the below guest blog written by noted environmental scholar Dan Farber, the Sho Sato Professor Of Law and the Faculty Director of the Center For Law, Energy, & The Environment at UC Berkeley.
There has been increasing interest in the environmental law community in the role that private firms can play in sustainability. For example, many major corporations bemoaned Trump’s withdrawal from the Paris Agreement and pledged to continue their own environmental efforts. In fact, as a recent book by Michael Vandenbergh and Jonathan Gillian documents, these firms already have their own programs to cut emissions. It’s worth thinking about the ways in which contracts between these companies could serve some of the same functions as government action.
Group action, based on contracting, could be a way of amplifying these efforts by individual firms. One possibility would stick pretty close to the structure of the Paris Climate Agreement. Under the Paris Agreement, nations agree to engage in certain types of monitoring and to implement emissions cuts that they set themselves. There are already ways that corporations can publicly register their climate commitments. The next step would be to
enter into contracts to engage in specified monitoring activities and report on emissions. The goal would be to make commitments more credible and discourage companies from advertising more emissions efforts than they actually undertake.
The contracts could be structured in different ways. One possibility is for each company to contract separately with a nonprofit running a register of climate commitments. The consideration would be the nonprofit’s agreement to include the company in the register and require the same monitoring from other registered companies. An alternative structure would be for the companies making the pledge to contract with each other, ensuring that there would be multiple entities with incentives to enforce the agreement against noncompliant firms. The biggest contract law issue is probably remedial. It would be difficult to prove damages, so a liquidated damage clause might be useful, assuming the court could be persuaded that significant liquidated damages are reasonable. An alternative set up would be to require representations by the company about compliance with monitoring protocols at they make their reports, providing a basis for a misrepresentation action.
We can also imagine something like a private carbon tax in which companies pledge to pay a nonprofit a fixed amount based on their carbon emissions. The nonprofit would use the funds to finance renewable energy projects, promote sustainability research, or fund energy efficiency projects such as helping to weatherize houses. Such pledges would probably be enforceable even without consideration under Cardozo’s opinion in Allegheny College. Damages would presumably be based simply on the amount of unpaid “taxes.”
It’s also possible to think in terms of a private cap-and-trade scheme, something like the ones used by California and by the Northeastern states. In these markets, governments set caps on total emissions and auction or otherwise distribution allowances, each one giving the owner the right to emit a single ton of carbon. In the contractual version, firms would agree to create a market in carbon allowances and to buy as many allowances as they need to cover their emissions. For instance, firms could agree to cut their emissions on a schedule of, say, 2% per year for five years. Every year, they would get allowances equal to their current target, which could be traded. Firms that were able to cut their emissions more than 2% could recoup the cost by selling permits to firms that found it too expensive to make their own cuts. Each firm would have to be bound contractually to pay for purchased allowances coupled with an enforceable obligation to achieve the target. If firms fail to buy the needed allowances, the measure of expectation damages seems to be the market price of the allowances the contract required them to purchase from other firms.
One advantage of government regulation is that the government can assess penalties, while contract law does not enforce penalties. For that reason, arguments for substantial compensatory damages will be crucial to provide an incentive for compliance. There will also be questions about how to structure the contracts (between firms or only between each firm and the nonprofit administering the scheme). And of course, all the usual issues of contract interpretation, materiality of breach, etc., will surface. (If nothing else, this could be the basis for an interesting exam question.)
Whether any of this is practical remains to be seen. There are also potential antitrust problems to contend with. But it is intriguing to think about ways that private contracting could be used to address societal issues such as climate change, particularly in situations where the government seems unlikely to act. There might be real gains from using private-law tools like contract to address public-law problems.
Wednesday, March 7, 2018
That's going to be the blog's new slogan.
Frances McDormand briefly made contract law trend on Twitter by using "inclusion rider" as her important two-word closing. At the time, there was only one result for "inclusion rider" when you Googled it. Now, if you Google it, you get a million results of articles explaining what an "inclusion rider" is. But here's the original video from Stacy Smith which was the one result before McDormand made it a cultural conversation.
I've had a series of blog posts over the past few years discussing the ways in which private contract law has been used to obscure systemic discrimination and abuse and harassment (a bunch of them are linked in this post). This is a nice suggestion for a way to use private contract law to try to correct some of the problems we've now exposed.
Monday, March 5, 2018
To the New Jersey native it happened to, well, a very costly mistake through several states.
According to this article, the man called an Uber after going out with friends in West Virginia. He was staying near West Virginia University, but he apparently requested an Uber to drive him to his home...which is in New Jersey. The drive was 300 miles, and problematically the man was drunk and so passed out upon getting into the car. He didn't wake up until two hours into the drive.
The news article is unclear as to the status of the trip. Uber claims the man has agreed to pay the fare; the man says he's contesting the fare because he never requested the Uber drive him to his home. It is true that Uber allows you to store a home address and also pulls up recent destinations when you request a ride, so one could foresee how such a mistake could happen.
It seems to me from the story that this was more likely user error, as the man was admittedly fairly drunk at the time he ordered the Uber. This also means that the man was probably too intoxicated to comprehend what he was doing as he entered into the agreement with Uber to order the car to take him home, but how was the anonymous Uber app to know? One could, however, foresee a separate confirmation page being necessary if the ride is going to cost more than, say, a thousand dollars (at least), but it's unclear that would have avoided the mistake, as the man may have been too drunk to grasp the import of the message. What should Uber do to try to avoid this sort of mishap? Anyone else have similar Uber mistakes?
h/t to reader Timothy Murray of Murray, Hogue & Lannis for sending this story to our attention!
Saturday, March 3, 2018
Completing the trilogy of non-compete cases this week, here's one out of the District of Maryland: Premier Rides, Inc. v. Stepanian, Civil Action No. MJG-17-3443. The industry this time is amusement park rides. The defendant is a structural engineer who worked for the plaintiff, mainly on roller coasters. He signed an employment agreement that contained a non-competition provision. When he decided that he wanted to resign his employment, he asked to be released from the non-competition provision. The plaintiff refused to release him. Subsequently, the defendant sought jobs that were non-competitive in nature, while apparently turning down a couple of employment offers from the plaintiff's competitors. He did, however, keep in touch with the plaintiff's customers, including interviewing for a job with at least one of them, before eventually accepting employment with DreamCraft. In his capacity at DreamCraft, the defendant worked on a project for one of the plaintiff's competitors and attended meetings with many of the plaintiff's customers. The plaintiff sued for breach of the non-compete.
The defendant first tried to argue that the agreement did not have adequate consideration, but the court noted that Maryland law is clear that "continued employment of an at-will employee" is sufficient consideration for a non-compete, as long as there is no other evidence of bad faith. The defendant continued to work for the plaintiff for three years after signing the agreement, receiving raises and bonuses throughout that time. So the court found that there was adequate consideration to enforce the non-compete.
The court also concluded that the non-compete had a valid corporate interest in that it prevented the defendant from exploiting the customer contacts he made while working for the plaintiff for the benefit of one of the plaintiff's competitors. The defendant, however, argued that the provision was not narrowly tailored to that interest. The time restriction of twelve months is routinely upheld in Maryland so the court focused on the fact that the non-compete was not limited in scope geographically. The court found that the plaintiff's market was global in scope, so the lack of geographic limitation was permissible.
The court did, though, find that the non-compete prohibited more activity than necessary. The defendant was an engineer, not a salesman, so the plaintiff's concerns about the defendant's customer relationships seemed misplaced. The defendant necessarily had to meet the plaintiff's customers to perform his job, but the plaintiff admitted that this kind of personal relationship was not important for the customers, who made their purchasing decisions based on price and "impact"of the amusement park ride. The agreement in separate provisions prohibited the defendant from soliciting the plaintiff's customers on behalf of his new employer and from disclosing the plaintiff's confidential information. The plaintiff did not allege the defendant had violated these provisions; rather, the plaintiff focused on just the fact of the defendant's employment by DreamCraft being enough to violate the agreement. But since the plaintiff's non-compete interests had been solicitation of customers or disclosure of trade secrets, to the court it was telling that neither of those was at issue in this case.
Accordingly, the court found the non-compete overbroad and unenforceable. It noted that it could rewrite the non-compete to be enforceable but it didn't know enough to edit it effectively at the moment.
Friday, March 2, 2018
Yesterday I wrote about a non-compete clause, and here's another one out of New York: Cogint, Inc. v. Moraes, 159597/2017. Yesterday's concerned auction houses, this one concerns digital marketing and advertising, in which Moraes was prohibited from competing for one year after his employment. The non-compete here seems to be worded as broadly in scope as the one that yesterday's court found to be overbroad, but there is no discussion about janitorial capacity in this case. Rather, the court concluded that the non-compete here was necessary to protect the plaintiff's interest because Moraes was a key employee in possession of trade secrets.
Not only was Moraes potentially in violation of the non-compete, but the court found that he potentially breached his employment agreement by terminating his employment before the term of the agreement concluded. The court found that the agreement did not provide him the right to terminate his employment at will.
Thursday, March 1, 2018
A recent case out of New York, Heritage Auctioneers & Galleries, Inc. v. Christie's, Inc., 651806/2014, deals with the world of luxury auctions. The plaintiff alleged, inter alia, that the defendant Rubinger breached the non-compete provision of his employment agreement when he resigned his position and went to work for Christie's Hong Kong office. The opinion is behind a paywall but the many points of contention between these companies has been documented in several places, including here, here, and here.
The employment agreement was governed by Texas law, so the court applied Texas law to determine that the non-compete provision was overly broad. The non-compete prohibited Rubinger from providing services for any business that participated, either directly or indirectly, in auctioning collectibles in North America in a manner competitive to the plaintiff's auction business. The problem was that the non-compete tried to prohibit Rubinger from providing any services for such business. As the court noted, Rubinger could have violated the agreement by working as a janitor at Sotheby's or in the mailroom at Christie's. The court therefore concluded that the non-compete was unreasonable.
However, under Texas law, the court reformed the provision to be enforceable, rewriting the provision to prevent Rubinger from providing services to competitors identical to those he provided to the plaintiff. Because that was exactly what Rubinger was doing, he was in violation of this rewritten non-compete provision.
The court found the time and geographic scope of the non-compete to be reasonable, and then found that the question of whether Rubinger's activities in Hong Kong violated it was a factual determination that could not be resolved.
Rubinger's employment agreement also contained a non solicitation covenant. When Rubinger resigned from the plaintiff to move to Christie's, two of Rubinger's staff resigned on the same day to make the identical move. The court found the non solicitation covenant enforceable, but nevertheless dismissed the claim because the non solicitation covenant, by its terms, prohibited Rubinger from soliciting the plaintiff's employees after termination of his employment. Because Rubinger's solicitation of his staff took place prior to termination of his employment, it was not prohibited by the terms of the contract.
There were many other claims in this complaint, including trade secret allegations and unjust enrichment. I focused on Rubinger's alleged breach of contract in this blog entry, but there were other aspects to the court's decision.
Wednesday, February 28, 2018
In this recent case out of California, Darien Ephram, Inc. v. Yashar, B279827, the lower court denied a motion to compel arbitration, finding that the plaintiff's claims were outside the scope of the arbitration provision. The defendant took issue with that determination, arguing on appeal that the lower court should have required the plaintiff to prove its claims, instead of merely relying on the allegations made in the complaint. This ruling, according to the defendant, showed a "hostility" to arbitration in violation of the policy favoring it.
The appellate court, however, disagreed, nothing that the defendant was "misunderstanding" the lower court's rulings. There was no reason for the lower court to take evidence because there were no factual disputes that the arbitration provision depended upon: None of the parties disputed the interpretation of the scope of the arbitration provision, and there was no factual defense that would have altered the character of the plaintiff's claims or the scope of the arbitration provision. Therefore, the court was entitled to legally determine that the claims in the complaint were not within that scope; no factual determination was necessary. The proving of the allegations in the complaint were for the next phase in the litigation, not for the motion to compel arbitration stage.
Tuesday, February 27, 2018
A recent case out of the Northern District of Illinois, Talcott Communications Corp. v. Quad/Graphics Printing Corp., Case No. 17 C 2278, deals with the enforceability of contract provisions prohibiting consequential damages.
Talcott sued Quad/Graphics for breach of contract and sought losses in advertising revenue when its advertisers left it because of Quad/Graphics's alleged breach. Quad/Graphics contended that consequential damages were waived under the contract and so Talcott could not seek the loss in advertising revenues. Talcott countered that the provision was unconscionable.
The court found the provision was not unconscionable. Talcott provided no evidence that Quad/Graphics did anything questionable during the negotiation of the contract. Talcott argued that it was "outgunned" because Quad/Graphics was a bigger company, but Talcott itself was a sophisticated business and there were no allegations of high-pressure negotiating tactics by Quad/Graphics. There was simply not enough bargaining disparity between the parties, nor enough evidence of coercive behavior to raise the court's concern procedurally.
Nor was the waiver of consequential damages substantively unconscionable. The court noted that Quad/Graphics would still be liable for any compensatory damages, and the waiver of consequential damages is routinely enforced by courts.
The court therefore granted summary judgment in favor of Quad/Graphics on Talcott's claim. (However, it denied Quad/Graphics's motion for summary judgment on its counterclaim as there was not a sufficient showing to justify summary judgment.)
Saturday, February 24, 2018
The Weinstein Co. has had yet another lawsuit filed against it for breach of contract over the Canadian distribution rights of “Paddington 2.” Prior to the allegations against co-founder Harvey Weinstein, the company had an agreement with Toronto-based EOne to distribute the film throughout Canada. In their lawsuit, EOne is seeking to recover $7.8 million that it advanced to Weinstein to obtain the rights to distribute the film throughout Canada. Amidst the controversy surrounding Harvey Weinstein, the company sold the rights to Warner Bros. After Weinstein broke the agreement, EOne terminated the distribution deal. The original contract provided for post-termination repayment of the advance.
Beyond the $7.8 million advance that EOne paid the Weinstein group, an action for lost profits may be available. The movie has so far grossed $192 million. The U.S. and Canadian box offices opened at $11 million. However, if EOne does decide to try to recover lost profits, it had better act fast. Since the allegations of misconduct were levied against Harvey Weinstein, the company has been on the verge of bankruptcy. The sale of “Paddington 2” to Warner Bros was enough to keep the company afloat until January. According to Reuters, the company is $375 million in debt. Killer Content and Abigail Disney have said that bankruptcy may be the best option for Weinstein Co.
Also found in the complaint is an allegation that Bob Weinstein telephoned the EOne division president to apologize for the sale to Warner Bros and to acknowledge that they would have to compensate EOne. It will be interesting to see if this argument is permitted. Further, the term “compensate” could be construed to include further damages. While only time will tell what the fallout will be from the ongoing Weinstein court battles, it is clear that the bucket is draining quickly.
Saturday, February 17, 2018
A U.S. judge on Wednesday dismissed a lawsuit seeking the return by the Metropolitan Museum of Art in Manhattan of a Pablo Picasso masterpiece that a German Jewish businessman was allegedly forced to sell at a low price in order to fund an escape from the Nazis and fascism.
Paul and Alice Leffmann fled Germany for Italy in 1937. Paul Leffmann sold “The Actor” the next year to two art dealers for $12,000 to fund an escape to Switzerland from the Fascist regime of Benito Mussolini, a Hitler ally.
The Met acquired “The Actor” in a 1952 donation, but did not acknowledge Leffmann’s ownership until 2011, after decades of incorrect cataloguing. Leffman’s great-grand niece, who handles the estate of the Leffmans, claimed that the circumstances of the 1938 sale meant that her family never lost title. The Met disagreed, while expressing sympathy for the Leffmanns’ plight.
The judge found that the sale “occurred between private individuals, not at the command of the Fascist or Nazi governments,” and not because of a “wrongful threat” by the buyers that took away Leffmann’s free will.
“Although the Leffmanns felt economic pressure during the undeniably horrific circumstances of the Nazi and Fascist regimes,” the judge wrote, “that pressure, when not caused by the counterparties to the transaction (or the defendant) where the duress is alleged, is insufficient to prove duress with respect to the transaction.”
It is both sad and interesting that so many years after the fascist rise to and fall from power, these types of cases are still heard in courts in this country and beyond.
Wednesday, February 14, 2018
Monetizing Sexual Harassment Contractually
In the Harvey Weinstein scandals, investigations have resulted in further almost incredible instances of alleged misconduct including:
- Verbal threats, such as telling employees "I will kill you" or "I will kill your family"
- Employing female staff as "wing women" to "accompany [Mr Weinstein] to events and facilitate [his] sexual conquests"
- Demanding sexual favors in return for career promotion at the studio
- Requiring his drivers to "keep condoms and erectile dysfunction injections in the car at all times"
- The requirement for his assistants to schedule "personals for sexual activity" both during office hours and after work
- Belittling female members of staff with insults about their periods, and shouting at one member of staff that she should leave the company and make babies as that was all she was good for.
Apparently, contracts for Mr. Weinstein contained the proviso that mistreatment claims would result in financial penalties imposed upon the accusers rather than be outright prohibited contractually. This, says some sources, “effectively monetized” sexual harassment.
Surely, no court of law would uphold a contractual clause penalizing an employee merely for making accusations of criminal conduct so long as this was done in good faith (which, as we now know, the accusations against Mr. Weinstein were). It is your legal right and arguably moral duty to call out criminal conduct when it happens. However, whether such an argument would ever be heard in court is questionable, for most employees working for famous, influential companies such as that of Mr. Weinstein and Mr. Weinstein himself are probably loath to stand up contractually against Mr. Weinstein. He clearly knew that. Many women didn’t even dare speak out against him for his criminal conduct or if they did, were not believed or helped. But these contractual clauses still show the gall, sickness, and immorality of Mr. Weinstein.
On a happier note: Happy Valentine’s Day! (I swear that the timing of this post is mere coincidence.)
Tuesday, February 13, 2018
By my count, 56 attorneys general have sent a letter to Congress asking for legislation that would exempt sexual harassment claims from the ubiquitous arbitration clauses found in employment contracts. The letter is succinct and eloquent on the damaging effects arbitration has on these victims and society as a whole.
Friday, February 9, 2018
I teach many Beyonce cases in entertainment law, but usually in an intellectual property context. The New Orleans Advocate reports that Beyonce has been sued in connection with her single Formation, but the lawsuit is contractual in nature. The plaintiff, Kimberly Roberts, is alleging that she entered into a contract with Beyonce to use footage from her documentary in exchange for a lump-sum payment and royalties. Roberts is alleging that Beyonce has breached the contract by failing to pay royalties. Roberts also alleges that Beyonce has exceeded the scope of the license that Roberts granted.
Toll Processing, LLC, plans to have Kastalon, Inc., fix some very large industrial machinery for it at some point in time. Kastalon stores the machinery in the meantime, thinking that it will only be a few months until Toll Processing can issue a purchase order for the repair. However, Toll Processing never does so. Kastalon eventually sells the machinery for its scrap value; $6,380. About two years later, Toll Processing contacts Kastalon to have the machinery fixed. “What machinery?,” asks Kastalon. “My $417,000 machinery,” is the answer. Lawsuit is filed for breach of contract.
Is storing items for a party without any definite timeframe being agreed upon an illusory promise? Both the district court and the Seventh Circuit Court of Appeals found that Toll Processing’s argument that Kastalon had promised to store the machinery until the issuance of a purchase order, “whenever that might be,” was indeed an illusory promise rendering the contract unenforceable. Perhaps, said the courts, the parties attempted to formulate a contract and were comfortable with somewhat informal proceedings, but parties cannot expect courts to complete the negotiation process and arrive at material terms on their behalf.
That makes sense, but the opinion also states that no less than two years had gone by between any contacts between the two companies. You would think that a simple email asking, “hey, what do you want us to do with your equipment, we can’t store it for free anymore?,” would have been possible and might have resolved this matter. The opinion does not mention bad faith, which seems to be at issue as well.
The case is Toll Processing Services, LLC, v. Kastalon, Inc., 2018 WL 505338.
Thursday, February 8, 2018
I am late to the party on this, but I still thought I would point you to Jill Lepore's recent review in the New Yorker of (among other books) Orly Lobel's You Don't Own Me: How Mattel v. MGA Entertainment Exposed Barbie's Dark Side. The book is about the epic showdown between Mattel, makers of Barbie, and MGA, maker of rival dolls Bratz, and it has a contract law angle: The designer who created Bratz worked for Mattel and allegedly arrived at the design for Bratz while under an employment contract with Mattel that would have entitled Mattel to the copyright for the design.
The review relays testimony from Mattel's CEO regarding his understanding of the scope of such clauses in employment contracts, namely that they are broad enough to entitle Mattel to claim ownership of designs created decades before the employee in question was hired. Unsurprisingly, in my experience, corporations frequently believe that clauses in employment contracts are indeed very broad; it's unclear how much the assertions of such broad readings affect employees' understandings of their rights.
Wednesday, January 31, 2018
Someday I will blog about things other than NDAs again but I feel like every time I open the internet there's another story about an NDA. Everyone today was talking about last night's interview of Stormy Daniels on Jimmy Kimmel Live!, which was a bizarre series of answering-questions-with-questions and playing coy and talking around the main issue, which was her alleged affair with Donald Trump in 2006. You can find lots of articles online; here's one that lays it out. Those trying to summarize the interview generally seem to assume that Daniels must be restricted by an NDA, because she could say if there wasn't an NDA, but it's the proving of a negative, basically; the reporters are trying to make sense of the blank space the non-answers leave in their wake.
It's all had me wondering about the role NDAs played--or maybe more importantly, didn't seem to play?--during the Clinton impeachment. Lots of details about Clinton's sexual harassment history came out during the impeachment, and from my brief research into it, it doesn't seem like there were any NDAs in play. Does anybody have other information about this? How do the number of NDAs around Trump in play today shift our perspective, conversation, and legal analysis?