• Non-Compete Agreements
• Tortious Interference
• Breach of Fiduciary Duty
• Breach of Contract

Legal News For New York Business Owners

Non-Compete Agreements

• New York Court Upholds Non-Compete Agreement in Cross-Country Dispute
  Jan 28, 2012

  Two insurance companies are at arms regarding employees violating their non-compete clauses. An insurance broker company named Aon has filed an injunction against Alliant Insurance Services, Inc., saying that the Newport Beach, California-based company was poaching employees and business. Aon is alleging that these actions have led to serious losses for its Construction Services Group.
  
  The New York Supreme Court awarded a preliminary injunction win for Aon, which forbids former Aon employee Michael Cusack and his new employer Alliant from entering into any business with clients or companies that had been contacts of Alliant employees when they were working with Aon. The injunction also forbids Alliant from soliciting employees of Aon’s Construction Services Group to move to their company.
  
  Former CEO of Aon Construction Services Group left the company the same day as Cusack to move to Alliant; fifteen clients and thirty-eight other employees also made the move.
  
  New York Supreme Court Justice Bernard J. Fried found that many former Aon employees were in violation of their non-compete agreements when they went to Alliant, which had recently begun negotiations with the Construction Services Group of Aon. But Judge Fried stated that it is not evident that Cusack and others took company secrets, about the negotiations or otherwise, of Aon to Alliant.
  
  Aon will likely succeed in showing that Cusack and others were in violation of their agreements after leaving Aon, according to Justice Fried. He also stated that there are other unspecified, but related, standards of employment that Cusack and others have violated for which they will be held accountable.
  
  The violation, or stronghold, of a non-compete agreement can be detrimental to your career. To learn more about your rights under a non-compete agreement, contact a New York non-compete agreement attorney today.
  

• New York Court Rules in Favor of Employee in Non-Agreement Case
  Jan 28, 2012

  A recent court case ruled in favor of Giovanni Visentin after International Business Machines Corp (IBM) filed suit when Visentin informed them he was moving to computing rival Hewlett-Packard (HP). IBM sued with the idea that they still had his intellectual property, which couldn’t be moved to one of its strongest competitors.
  
  The New York non-compete agreement law is put in place to protect from employee poaching and to ensure that a company’s secrets are protected after employees move to another business in the same field. When legal and enforceable, they are important tools to ensure a company’s investments and progress in the field aren’t immediately taken to be used against them. But most states, including New York, often rule against the non-agreement clause because they feel it hinders the competitive nature of American businesses. It is often ruled that an employee, such as Visentin, has the right to take his knowledge of the field, his talents, and his experience back into the working world.
  
  In the Southern District of New York District Court, Judge Loretta Preska ruled against the request from IBM to bar Visentin from working for Hewlett-Packard for one year after resignation from IBM. The ruling stated that IBM had not proven that Visentin’s employment at HP would damage its business by disseminating company secrets or specific trade information. Judge Preska noted that IBM has employees with more knowledge of trade secrets and are not bound by non-compete agreements. One of IBM’s employees actually testified that the non-agreement clauses are put in place more to retain employees than to protect trade secrets. It was with these findings that Visentin was allowed to pursue a new career with Hewlett-Packard, and shouldn’t be trapped with an unreasonable non-compete agreement.
  
  If you think you’re trapped in a non-compete agreement, don’t. Before you call it quits and pass up the opportunity of a lifetime, contact a New York non-compete agreement lawyer at the Law Offices of Jonathan M. Cooper. We can help you break the reins of your employer and help you regain control of your life.
  

• Banker Sued Over Non-Compete Clause for Involvement in New York Bank
  Jan 27, 2012

  Capital One Financial Corp is crying foul years after one of its former top bankers moved to a smaller corporation. John Kanas is being sued for breach of contract by the financial company where he was previously head of banking until he resigned in 2007.
  
  Kanas agreed to a non-compete clause when he began working for the Virginia-based credit card company. This non-compete agreement states that he could not work with a company that could be seen as competition for Capital One Financial after he left the company. The clause covered a multi-state area in the northeast, including New York and Virginia, for an unspecified amount of time.
  
  Capital One says that they parted ways amicably with Kanas, accepting his resignation after he earned a multi-million dollar compensation package. Kanas is now the chief executive of BankUnited, Inc., which operates out of Florida—technically out of the reach of the non-compete clause.
  
  However, the lawsuit was brought on by Capital One Financial in 2011, four years after Kanas left the organization, after BankUnited, Inc. purchased the small New York-based lending firm Herald National Bank.
  
  Even though BankUnited, Inc. is based quite far from New York, pulling profits in from a bank which is operating in the same business area as Capital One may violate the non-compete agreement that Kanas accepted while working with the Virginia-based company.
  
  Capital One Financial Corp is also naming John Bohlsen in the suit. Bohlsen was in charge of the commercial banking business for Capital One and is now the vice chairman and chief lending officer for BankUnited Inc.
  
  If you have questions about your non-compete agreement, contact a New York non-compete lawyer for a free consultation.
  

Breach of Fiduciary Duty

• Bank of New York Mellon Faces Lawsuit for Breach of Fiduciary Duty
  Apr 25, 2012

  On Tuesday, April 3, U.S. District Court Judge William Pauley ruled in Manhattan that bondholders who invested in 26 trusts may pursue claims against Bank of New York Mellon based upon breach of fiduciary duty. The bondholders allege that they purchased products containing risky mortgage loans from the former Countrywide Financial Corporation. Bank of New York Mellon serves as trustee for mortgage-backed securities.
  
  In their lawsuits, the bondholders assert that Bank of New York Mellon’s obligations as trustee included ensuring that underlying home loans are properly documented and that bondholders’ rights are protected. Bank of New York Mellon attempted to have the lawsuit dismissed. Judge Pauley’s ruling means that the bondholders may go forward with their claims that they suffered more than $9 billion of losses or delinquencies. The claims involve securities that are backed by more than $30 billion worth of loans.
  
  In their complaint, the plaintiffs assert that Bank of New York Mellon breached its fiduciary duty when it failed to take action to remedy Countrywide’s inadequate servicing of the home loans contained in the trusts. They claim that the defendant:
  

  • Failed to take possession of loan files;
  • Failed to take possession of the original mortgage notes; and
  • Failed to require Countrywide to fix or buy back defective loans.
  
  Judge Pauley’s ruling allows bondholders to sue on the basis of the 26 trusts in which they invested, and upon claims that Bank of New York Mellon did not properly notify them that Countrywide had defaulted on some obligations. 
  
  To learn more about the New York legal principles involved in this case, contact a New York breach of fiduciary duty lawyer at (888) 497-3410.
  

• Kenneth Cole Under Investigation for Possible Breach of Fiduciary Duty
  Apr 20, 2012

  An independent firm is looking into the recent filings by Kenneth Cole to purchase the remaining shares of his company Kenneth Cole Productions. Cole already owns 47% of the stock, holding about 89% of the voting power for the company. The investigation will seek to determine whether or not the intended purchase price of shares in the company is set at a fair price for the stockholders. 

  The sale of the remaining shares is set for $15 each, but some analysts set the price at around $16.50. The independent investigation will take into consideration the value of the company currently set at approximately $280 million. If the investigation determines that Cole is negotiating too low of a price for the shares, he may be in a breach of duty to the share holders. 

  Cole is currently the Chairman and Chief Creative Officer for the company and has made it clear that he is not interested in negotiating his offer for the remaining shares, and has no interest in approving the sale of the shares to an outside investor. His substantial voting power puts him in a strong decision making position, but that could also put him at a higher risk of violating the fiduciary duty to the company’s other stockholders. 

  Owners of stock in a company deserve to have their best interests defended by the company’s executive officers. If you have questions or concerns about the fiduciary duty of a company’s owner or board of directors, you deserve to speak with a New York breach of fiduciary duty attorney who can get those questions answered. Contact The Law Offices of Jonathan M. Cooper for a free consultation, and order their book 3 Reasons That Your Employment Agreement May Not Be Worth The Paper It's Printed On. 

• Investigation of Possible Breach of Fiduciary Duty in CVR Energy
  Apr 12, 2012

  An independent investigation has been launched in the recent sale of CVR Energy, Inc. and whether or not there has been a breach of fiduciary duty. Carl C. Icahn, through at least one of his affiliated companies, made an unsolicited offer to purchase all of the outstanding shares of CVR Energy, Inc. 

  The terms of the purchase agreement put forth by Icahn is estimated to be around $2.6 billion, with stockholders receiving $30 cash per share. The shareholders will also be awarded a Contingent Value Right, which where they would receive additional payment if the final sale renders the shares of stock over $30. Some analysts value the current stock sale price at $35. 

  The process of the sale to Icahn will undergo an investigation by a private firm to decide if the Board of Directors of CVR Energy, Inc. properly shopped around before the sale of the company and whether or not they were able to negotiate for the highest possible share prices for their stockholders. 

  Since the stockholders purchase shares of the company, they have put their trust in the board of directors to invest in their best interests. If it is discovered that the board had not gone through the proper sale process before making the agreement, they may find themselves in a possible breach of fiduciary duty to their shareholders. 

  If you have questions regarding breach of fiduciary duty in New York, contact the Law Offices of Jonathan M. Cooper. His office of experienced New York business attorneys offer free consultations, and you can order their book 3 Reasons That Your Employment Agreement May Not Be Worth The Paper It's Printed On free online.

• Investigation of Possible Breach of Fiduciary Duty by Taleo Board
  Feb 27, 2012

  An investigation has recently been launched into the sale of Taleo Corporation to the Oracle Corporation. The investigation will seek to discover if the Taleo Corporation Board of Directors were involved in a breach of fiduciary duty to their stockholders. 
  
  A breach of fiduciary duty occurs when one party (in this case, the stockholders) puts its faith in another party (Taleo Corporation) to act in its best interest. A contract is not necessary to establish a fiduciary relationship between two business partners. By purchasing stock in the Taleo Corporation, stockholders count on the board to maximize their potential earnings and stock value. It may be possible that the Board of Directors for Taleo did not properly shop the competition before agreeing to sell the company to the Oracle Corporation in an all-cash deal set at $1.9 billion, leaving each share of stock worth $46. 
  
  If the Board of Directors had shopped around for more potential buyers and worked harder at securing a better price, some analysts believe that shares could have been as high as $49. The three dollars might not seem like a lot per share, but the money surely adds up after dozens, hundreds, or thousands of shares are purchased. 
  
  Questions regarding this case and it potential impact on the stockholders can be directed to The Law Offices of Jonathan M. Cooper. Their experienced New York business lawyers are available to help you with your New York breach of fiduciary duty questions. Their free book, When You Don’t Have a Written Agreement, is available to order online. 
  

• Possible Breach of Fiduciary Duty in Sale of General Bearing Corp
  Feb 27, 2012

  A private investigation is being launched into the possible breach of fiduciary duty by the Board of Directors of General Bearing Corp. The company was recently sold to the Swedish company SKF Group in an all-cash deal worth just over $144 million. The negotiations have stated that the current value of each share of stock is worth $28. 
  
  The investigation will attempt to discover if they did enough to maximize the sale price of the company and get the highest possible share value for the company’s shareholders. The independent investigators will look at how the Board of Directors of General Bearing Corp. shopped the company around before agreeing to a deal, and whether or not they were able to secure the best deal for the company. 
  
  They will also seek to discover if the board acted in the best interest of its shareholders by agreeing to the deal, or if there is a possibility of a class action lawsuit for a breach of fiduciary duty by the board. A fiduciary relationship is one where a party (the shareholders) places its trust, well-being, and finances in the hands of another party (the board). If it is determined that the board failed to maximize profits for its shareholders, they could be in breach of their fiduciary duty.
  
  Questions regarding this case and the potential impact on the stockholders, or other breach of fiduciary duty cases, can be directed to The Law Offices of Jonathan M. Cooper and their experienced New York business lawyers. Their book, When You Don’t Have a Written Agreement, is available to order for free online. 
  

• Micromet Under Investigation for Possible Breach of Fiduciary Duty
  Feb 07, 2012

  The health research company Micromet, Inc has recently come under fire for a possible breach of fiduciary duty. The company has agreed to be taken over by Amgen in a cash tender offer, possibly by the end of the first quarter this year. Included in the deal is the sale of all outstanding public shares in the company.

  The investigation is set to determine if the Board of Directors of Micromet, Inc actively and dutifully shopped the market before agreeing to be taken over by Amgen. If it is discovered that the board has not made a full attempt to acquire the best stock prices for its shareholders, they may be in breach of their fiduciary duty. The shares will be priced around $11, but one independent analyst believes a properly researched sale could have received upwards of $12 per share. If this is discovered to be true, the Board of Directors could come under further scrutiny and possible legal action from Micromet, Inc’s shareholders. 

  Questions regarding this investigation and breach of fiduciary duty in general can be directed to The Law Offices of Jonathan M. Cooper. Consult their New York business lawyers in a free consultation, and order their book, 3 Reasons That Your Employment Agreement May Not Be Worth The Paper It's Printed On.

• Convio, Inc. Under Fire for Possible Breach of Fiduciary Duty
  Jan 30, 2012

  The company Convio, Inc is under investigation for a possible breach of fiduciary duty to its shareholders after agreeing to a deal that would lead to its takeover by Blackbaud, Inc. A cash tender offer would lead to payment of $16 per share.
  
  A business relationship is considered to be bound by fiduciary duty when there is an elevated level of trust and vulnerability. The relationship must go beyond the normal levels, such as when one party relies on another to consider its best interest with money or the fate of a company. Some relationships include lawyers, business partners, stockbrokers, real estate brokers, and financial advisors.
  
  The sale of Convio, Inc. to Blackbaud, Inc. is under investigation because the Board of Directors of Convio might not have had the best interest of its shareholders in mind. The investigation will look into whether or not the Board properly shopped around to an adequate field of competitors to acquire the highest price possible for the shares.
  
  If it is shown that the Board failed to get maximum value for its shareholders, they may be found in breach of fiduciary duty, as the shareholders place a high amount of trust in the company to look out for their best interests. The stock value of Convio, Inc. has increased over the past year and analysts believe that it would increase even more, increasing the expected value in the sale to Blackbaud, Inc.
  
  Questions about the investigation or regarding breach of fiduciary duty can be directed to a New York breach of fiduciary duty lawyer at the Law Offices of Jonathan M. Cooper. 
  

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