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Atlanta Business & Commercial Law Blog

Severance agreements carry more explicit terms

Ever since the #MeToo movement became a household phrase following the Harvey Weinstein allegations, companies of all kinds have been reevaluating the terms of their severance agreements. It is a testimony to modern corporate life that many severance agreements now contain explicit language based on a company’s new code of conduct—but in some, the language is still unclear.

Backing up words

$250 million auto insurance fraud settlement

State Farm Insurance, the largest property casualty insurance company in the country, was the defendant in a lawsuit for fraud which they recently settled out of court; 4.7 million plaintiffs brought the class-action lawsuit naming State Farm as the defendant in the case. These policyholders claimed the company cheated them by using substandard vehicle replacement parts.

State Farm Auto Insurance policies guaranteed customers would receive original manufacturer parts to replace those damaged in vehicle accidents. Instead, the customers discovered the installation of generic, low-quality parts that cost much less. When the customers tried to protest and get the parts their policies promised them, State Farm denied their claims.

When business partnerships break up

If you and your Georgia business partners do not see eye to eye anymore and you seem to spend more time arguing than selling your product, you may be headed for a partnership break-up. If you are, you likely will find the process similar to the break-up of a marriage. In fact, it may surprise you to learn that business partnerships stand a 20-30 percent higher likelihood of breaking up than do marriages.

Business partnerships end for many of the same reasons that marriages end. The people involved “grow apart” over time. Where you and your partners originally had high hopes for your business and reasonably compatible ideas on how to achieve your goals and objectives, you may now find yourself at loggerheads.

Tips for hiring your startup's first employee

Running a startup business is an exciting venture. As you start to experience success, handling it all on your own or with a partner may not be feasible. Eventually, you may start to expand your company by hiring employees. 

While this is a wonderful prospect, you may face some confusion and hesitation when hiring your first worker. You have to consider plenty of legal, procedural and interpersonal factors when making this decision. Here are a few core guidelines to follow as you become an employer.

FLSA and valid arbitration agreements

One of the biggest questions regarding Fair Labor and Standards Act’s (FLSA) collective actions and valid arbitration may have been answered by the U.S. Court of Appeals for the Fifth Circuit Court. This ruling, the first of its kind, determined that district courts should not send notice of a collective action to employees with arbitration agreements that are valid. The exception to this rule is when there is nothing in the agreement that would prohibit the employee from participating in a collective action.

Why the exception?

Protecting trade secrets makes them trade secrets

A federal judge in Chicago recently gave a stinging reminder to businesses that they need to protect their trade secrets. Judge John R. Thorp issued a thorough opinion on Abrasic 90 Inc., d/b/a CGW Camel Grinding Wheels, USA v. Weldcote Metals, Inc., Joseph O’Mera and Colleen Cervencik, even giving the pointers to the losing side about why they lost.

Abrasic 90 thought it had a pretty strong case after the company’s longtime president left the company to start Weldcote Metals to compete with Abrasic 90. The employee walked out the door with a flash drive containing information about the company’s suppliers, pricing and customers. In addition, he hired another Abrasic 90 employee who also brought additional sensitive information with her. Together they used this data as the basis for the new business, including customer targeting.

Is there legal recourse for bad online reviews

It used to be that businesses, particularly small businesses, counted on strong word of mouth recommendations to get the word out about products and services. These days, however, reviews from online media platforms Yelp and Foursquare are where consumers go to get recommendations. This can translate into more business when the reviews are consistently positive, but many small businesses can struggle if one bad review keeps showing up. The frustrating part for many businesses is that the review may not even be accurate, or the owner took the criticism to heart and addressed the issue long ago.

Legal tips for dealing with social media challenges

Employees exercising power on moral grounds

The traditional power structure in a company seems to be one of two different approaches. There is the top-down method where the boss or board is in charge, and there is the bottom-up structure where unions or groups of employees exercise certain powers. In the era of open office plans and flat management structures, the latter approach seems to be gaining momentum, particularly in the tech industry where innovation, speed, coordination and communication are prized.

Flexing their muscle

Tips for protecting trade secrets

Trade secrets can be in the form of a formula, device, process or information that is used by a business to earn income or generate value. The Uniform Trade Secrets Act defines trade secrets as pieces of information that have value because they are not well known and can be reasonably maintained as a secret. It is nearly always in the best interests of a business to protect trade secrets, but it is easier said than done. Here are some helpful tips to start the conversation about protecting a business’s trade secrets:

  1. Identify your secrets: This involves looking at business practices and come up with protocols to determine what needs to remain a secret. Focus on the important rather than sweeping protection that may be too broad to ensure strong protection.
  2. Label your documents: If it is sensitive information, make sure to indicate that it is “confidential” to the employees involved. Limit copies and circulation of these documents.
  3. Properly store the information: Determine where the information can be safely stored, take steps to monitor who has and who gets access to the information. Look for weak spots in that storage, whether it is computers, diskettes or hard copies.
  4. Computers need passwords: Computers containing sensitive information are lost or stolen all the time, so it is always best to utilize passwords (the stronger the better).
  5. Hold vendors accountable: This can be difficult, particularly when working internationally, but there should be strict well-considered provisions in vendor contracts. It is generally best to divide the necessary knowledge amongst different vendors to ensure that none of these partners has all the information.
  6. Set up training for employees: Educate employees about how to recognize and handle sensitive information. Hold employees accountable with clear protocols for those who do not act accordingly. Hold exit audits and recover any sensitive information, such as a work laptop.

NYC is first city to provide protections to black employees’ hair

The New York City Commission on Human Rights has now issued new legal guidance regarding black people’s hair. According to local news, employers as well as gyms, libraries, school and nightclubs cannot force people to change their natural hair as a requirement for being admitted or retain affiliation. The determination went on to say that natural black hair has nothing to do with “professionalism” or “neatness,” which seems in direct contrast to the Alabama women who refused to cut or change her dreadlocks for a new job. In the latter case, the Supreme Court refused to hear the case, essentially saying that employers could do this.

Mayors wife weighs in

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