10293608_624207605888_7061502990149731899_o

Congress wants to protect your right to complain about bad service and products

Earlier this year Aaron wrote an article on companies suing customers for defamation resulting from bad reviews on sites such as Yelp. In order to further curb these bad reviews, companies with products that have agreements or terms of use had been adding “non-disparagement” clauses to consumer contracts. These clauses sought to fine those who posted negative reviews or ban customers from making them. Congress may soon put a stop to this practice.

Continue reading

PDXschwabe2

Thankfully For Plaintiffs, Halliburton Can Still Defraud the Entire Market

Halliburton Co. v. Erica P. John Fund was finally decided this summer (for background on this case, including the issues, see my first two articles on the case here and here) and the presumption of reliance on the integrity of the stock price that was created in Basic v. Levinson was upheld. The fraud-on-the-market theory is alive and well. Halliburton (the petitioners to the Court and the defendants in the class action) also lost on their request to require that plaintiffs in securities class actions prove “price impact” at the class certification stage. They won a small victory by granting defendants in securities class actions the ability to rebut the presumption of an efficient market at the class certification stage so they will no longer have to wait until arguments are made on the merits of the case in order to address it.

Continue reading

477767_588317499948_2034580185_o

Securities Laws Still Apply to Robot Dinosaurs

Jimmy wants to start a business that makes small robot dinosaurs. He spent his time learning robotics and computer-based design in college and now wants to put it to use by creating miniature versions of the Jurassic Park animatronic dinosaurs that kids can play with. He does a few designs, for a velociraptor, triceratops and brachiosaurus and thinks that he can make and sell them for a profit. So he starts a company, Mesozoic Toys. Jimmy needs money to start building and advertising his products, however, and in doing so he needs to make sure that he doesn’t run afoul of securities laws.

Continue reading

615218_566228271938_1658179001_o

Fraud on the Market 2: Finding the Middle Ground

Those who read my first fraud-on-the-market article may have noticed that I only discussed the two options for the Supreme Court to take regarding the use of the fraud-on-the-market theory as a way to show commonality and predominance at class certification. Those two options were keep it or toss it. There may be a middle ground, however. While the two sides in the case have remained on opposite ends of the dichotomy, some third parties have weighed in suggesting a option that would act as a compromise between the two extremes.

Continue reading

DSC05294

Bitcoins are Property, Not Replacements for the Dollar

When the Treasury Department’s Financial Crimes Enforcement Network (“FinCEN”) announced its rules for Bitcoin and other “cryptocurrencies” a little over a year ago, observers knew it was only a matter of time before the IRS would follow suit with its own guidance on how to treat virtual currencies for tax purposes.  This past Tuesday the Service finally did so, releasing Notice 2014-21 which clarifies the Service’s position on how to properly report transactions involving Bitcoin and other virtual currencies, effectively killing any chance of Bitcoin’s widespread adoption as a substitute for official currency in the US.

Continue reading

Crowdkid

Crowdfunding Part 2: The Pros and The Problems

This post will be the second post on the new concept of crowdfunding. If you haven’t, take some time to read the first installment. Crowdfunding is billed as being a savior of small business and a boost to the power of the everyman entrepreneur by tapping into the power of the internet and the masses to provide funding for their businesses. This post will give an initial idea of the pros of having this legislation and the potential problems that might arise.

Continue reading

HOJ2

The Fourth Amendment and License Plate Scanners

I was watching my favorite daily car news show, Fast Lane Daily, today and ran across  mention of police using license plate scanners on traffic. They do this to be alerted to potential crimes and violations such as cars wanted in connection with an amber alert. There Derek D., the host, states that the practice violates the Fourth Amendment to the US Constitution. I think this claim needs to be fleshed out a little bit so that people don’t have an incorrect understanding as to why this Fourth Amendment claim is being made.

Continue reading

1511777_611660300788_168949708_o

Bad Reviews are not Defamation

It’s an unavoidable fact of running a business that, sooner or later, a customer will be dissatisfied.  Decades ago this would have meant that they told a few of their friends, but today it can often mean a negative review on any one of a number of widely trafficked consumer review websites like Yelp.

When the inevitable happens, there are a few ways you can handle it.  For example, if you want to avoid bad publicity, you can simply ignore the review or respond calmly and professionally.  If you don’t mind things potentially blowing up in your face, you can respond angrily and irrationally.  And, of course, if you actively want things to go south in a great big hurry, you can do what a watch repair shop in New York did and threaten to sue the person leaving the unflattering review for defamation. Continue reading

couch2

Don’t Accidentally Leave Your Retirement Account to Your Ex Girlfriend

The Oregonian published an article on Saturday on the topic of beneficiary designations for different investment/savings vehicles. This article was written around a case where the father, Timothy Freed died intestate (without a will) and inadvertently left his entire IRA account to his ex-girlfriend of many years. He had broken up with her in a “very bitter parting” eleven years before his death. After their split, he revoked the will that left her some of his property and he even had a court order stating that she had “no right or interest” in Freed’s retirement account. Given all of these measures, how does one inadvertently leave someone their entire IRA account? The answer is by not updating the beneficiary designation that is made on the account when it is created. Continue reading