Friday, May 31, 2013
Rube Goldberg and the indemnification provision
I received a couple of emails from readers who enjoyed the previous youtube clip of highlighting issues related to sandbagging (Like the cat that ate the canary) in merger agreements. Now, here's another one - consider it free/fun CLE (especially you summer associates!) in which Rick Climan and Keith Flaum walk us through unexpected issues in indemnification provisions.
More specifically, the topic for this clip is the question of whether there should be indemnification for any direct or indirect damages that relate from any direct or indirect breach of any representation or warranty. Hmmm. Word to the wise associate - don't fall for it. Why? Here's the Rube Goldberg hypothetical to explain why: