Checking the pulse of business law

Area attorneys share their thoughts about recent trends in business law & new faces on the bench

Courthouse

According to area attorneys, many factors, ranging from the economy to technology and regulatory changes, are affecting the fabric of the cases they see and how those cases are settled.

Economic ripples

The recent uptick in Clark County’s economy has revealed a heretofore hidden cost of the recession, according to local attorney John Bachofner, a partner in Jordan Ramis PC.

“Some businesses have cut costs,” said Bachofner, by reducing or avoiding legal counsel. Unfortunately, he continued, “this can result in litigation later, due to unclear contracts and unintended consequences” of poorly written clauses.

Joe Vance, a partner with Miller Nash, said he is seeing the same trend, where inadequate documentation all too often leads to messy disputes. The ideal, said Vance, is to avoid the time, distraction and monetary costs of litigation by proactive measures when forming partnerships and forging contracts.

“You can’t get too cheap on the front end,” said Vance, “or the back-end costs go up. And once you’re in litigation, you’ve already lost, even if you win your case.”

Jesse Conway, a sole practitioner in Vancouver, said that the rebounding economy has changed the types of cases he is seeing in his law office. During the recession, said Conway, the primary case types included foreclosures and short sales, contractor payment disputes, partnership disputes over accounting and attempts to break leases early.

Now that things are picking up, Conway explained, he is seeing a different mix. People are looking at new leases and starting new businesses, looking for investors and reviewing new contracts.

Government budgetary woes are poised to trickle down to the judicial system, according to Russ Garrett, another partner at Jordan Ramis. He said the bankruptcy court could see staff cuts that could lead to delays in filings, hearings and decisions – something he has already seen happen with his Oregon cases.

“Last year we had to wait months for a substantial settlement amount,” said Garrett, due to delays in entering a judgment.
Let’s work things out

Another trend that Conway mentioned, and that Vance confirmed, is that there is a “huge shift” toward arbitration, rather than going to trial.

“Arbitration is so much more efficient,” said Conway. “Often, arbitrators have industry background and we spend less time educating them, compared to a judge and jury.”

A white paper published by the National Arbitration Forum stated that “a reasonable expectation is that the cost of arbitration will not be in excess of half the cost of litigating.” [source: http://www.adrforum.com/users/naf/resources/GeneralCommercialWP.pdf]

“Litigation and the judicial system are not very efficient, and are the last resort for most businesses,” said Vance. “It’s very expensive, unpredictable and lengthy.”

Patent progress

According to Kurt Rylander, senior partner at Rylander & Associates PC, the advent of the Internet is “dramatically changing” the procedures and rules of evidence associated with patent and copyright cases.

Rylander reported that “Internet trolling” cases are on the rise, where companies search the Internet for unauthorized use of copyrighted material such as images, then send cease-and-desist letters threatening suit. Companies look for potential patent infringements in the same way. Rylander said that four years ago, he never handled such cases – now he handles one or two every month.

“Just because an image shows up on Google search doesn’t mean it’s free to use,” cautioned Rylander. “If it doesn’t say it’s free, it’s probably not.”

Patent law process is also in flux. Currently, determining what a particular patent covers (claims construction) is decided by a judge, while a jury decides whether a defendant’s action is within scope of that patent. 50 percent of claims construction decisions, said Rylander, are later reversed by an appeals court, while far fewer jury decisions are overturned. This leads to a “huge amount of uncertainty” in patent cases. Rylander expects that over the next three to four years, more deference will be given to judges’ claims construction decisions.

Rylander also said that his international case load has increased significantly, both with international patents and connecting local companies with import/export resources.

“There are a lot of businesses in Clark County doing business in Asia,” said Rylander. “It’s not just the big companies.”
In the line of hire

In 2012, said Vance, the Equal Employment Opportunity Commission (EEOC) issued its priorities for 2013-2016. Among these are an emphasis on pay issues relating to gender and race discrimination, elimination of barriers in hiring practices (such as discrimination based on age, gender, disabilities, race and religion) and protection of “vulnerable” workers (such as immigrants and migrant workers) from harassment.

“The EEOC seems to be more aggressive, particularly with respect to pursuing litigation,” said Vance.

In the past, he said, the EEOC only pursued the largest or highest profile cases. But now, the EEOC is hiring more litigators and taking on more cases.

Another area of employment law that Vance said is very active currently concerns non-compete agreements. With the current economy, said Vance, employees are moving between employers more often, and “technology makes it easy to walk out with confidential information.” He sees employers trying to enforce non-compete agreements to protect trade secrets, as well as trying to break non-compete agreements so they can hire a particular employee.

Community spirit

Although the areas of expertise are many, and members may find themselves on opposite sides of a case, Bachofner said that the Clark County Bar Association is a close-knit community.

“The bar here is very professional,” said Bachofner. “We haven’t gone the way of other metro areas, and don’t waste time fighting over little things.”

Although every business hopes to avoid lawsuits and litigation, if faced with such a situation, Garrett offered the following advice.

“Choose your attorney carefully. You want someone competent, but that doesn’t waste time and money because they don’t play well with others.”

New faces on the bench

Several new judges (such as Superior Court Judges Gregerson, Gonzales and Stahnke) have made their appearance recently. These new players, said Rylander, bring highly relevant business law experience to the table. Generally, he said, judges make their way up through the ranks from criminal defense and prosecution, and often don’t have a clear idea of how that differs from the “real world” of civil and business law.

“I believe [the new judges] will be more amenable and excited about business suits,” said Rylander.

Being familiar with non-criminal, non-domestic relations cases, said Garrett, will be a “real benefit to everyone in Southwest Washington.

“Good and consistent decisions are good for business owners, and let them plan a lot better,” he added.

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Jodie Gilmore’s journalistic background includes more than 15 years of writing for the Vancouver Business Journal as well as other publications such as Northwest Women’s Journal, North Bank Magazine, American Builders Quarterly and The New American. A Master’s in Technical & Professional Writing and 20+ years in the trenches as a technical writer and online help developer round out her writing background. When not writing, she enjoys gardening and working on her small farm in the Cascade foothills.