Cleveland Law Library Weblog

Law Firm Mergers Are on the Rise

Legal Current has reported that domestic law firm mergers rose 67% in 2011 compared to 2010 figures. There were apparently 45 mergers last year versus 27 in 2010, and a study by the Hildebrandt Institute predicts that the trend will continue this year. Click here to read the entire Merger Watch report.

Ohio Supreme Court Task Force Report Recommends Commercial Dockets for Qualified Courts

The Ohio Supreme Court's pilot commercial docket project is apparently a success. According to a Task Force report issued by the Court, "certain qualified courts can create separate dockets to resolve business-to-business disputes." Locally, the Cuyahoga County Common Pleas Court has been participating in the pilot project since 2009 and handling cases which the Supreme Court indicates include "business liquidations, trade secret disputes, non-compete contracts, and shareholder disagreements." Other recommendations from the Task Force report include:

1. Expanding the program to other courts by setting the parameters for which courts can establish commercial dockets.
2. Requiring commercial docket judges to complete additional continuing education requirements.
3. Creating a new Commission on Commercial Dockets to oversee the program.
4. Operating commercial dockets with at least two judges.

Our Law Library Can Help Members Who Need Co-Working Office Space

The new trend for lawyers and business people is to get away from the office for quiet phone calls, meetings or conferences. The name of this new trend where multiple people share the same space when they need it is called the "co-working office space industry." Although vendors are providing this quiet space for a fee, the Cleveland Law Library has been offering this service to members for a long time as part of membership for no additional fee. Our members can reserve our conference room for meetings, depositions, conference calls, and other business. Members should call 216-861-5070 to reserve our conference room Monday through Friday 8:30 a.m. to 5:00 p.m.

If Survey Results Are Correct, Litigators Ought to Make Money Next Year

Fulbright's 7th Annual Litigation Trends Survey Report indicates that business disputes and litigation will be up in the next 12 months. That would be good news for lawyers who have had fewer clients and less work to do lately. Click here to read the report (you may have to register for free), and click here to read a press release about the report. KJK Lawyer John Hyman has also posted his insightful comments on the survey.

"B" Corporations Strive to "Benefit" Society

Until I read an article from the Christian Science Monitor today, I had no idea what a "B" corporation was. Although "B" corporations currently have no special legal significance where the IRS is concerned, they have a special focus when it comes to their operations, which must be designed to consider the interests of multiple stakeholders and "benefit" society. B Lab started the initiative in 2007 and can count 200 certified "B" corporations on its rolls, with a target of 300 by the end of this year. B Lab describes a "B" corporation as follows: "B Corporations are a new type of corporation which uses the power of business to solve social and environmental problems."  The article referenced above indicates that B Lab is lobbying the Obama administration for a lower tax rate for self-designated "B" corporations.

Ohio Business Gateway Updates its Electronic Filing

According to Ohio.gov, the Ohio Business Gateway has enhanced its website as of today to make filing business documents easier online. Although I could not get into the new site this morning, businesses will be able to access a single, consolidates site for logging in to all Gateway services, and they can give their lawyers and accountants shared access when necessary. Paying is supposed to be easier, as it logging out. A new plus will be the ability to check a history link for prior confirmations and receipts. Hopefully, the new site will be working later today:

https://ohiobusinessgateway.ohio.gov/OBG/Membership/Security.mvc/Login

More Corporate Reform Afoot

HB 134 aims to make incorporating in Ohio more attractive by allowing corporations to permit majority voting instead of plurality voting.  The bill builds upon corporate reforms made in the last session.  OSBA supports H.B. 134 , Inside OSBA, March 29, 2007.  See our prior post:  Ohio Corporate Law Modernization Act, Aug. 1, 2006.

Supporting "Culpable" Employees During Corporate Fraud Prosecutions

A recent article examines the impact of the McNulty Memorandum on a corporation's support of "culpable" employees during a corporate fraud investigation.  The Department of Justice can decide which employees are "culpable" even before a determination of guilt.  The McNulty Memorandum prohibits prosecutors from giving cooperation credit to a corporation for cutting off the payment of legal fees to executives or employees.   However, the government may penalize corporations for other types of support, such as continued employment without sanctions for misconduct or information sharing pursuant to a joint defense agreement.  See Will the Government Punish You for Standing by Your Employees? by R. Christopher Cook, Jones Day Publications, March, 2007.  Also see our prior post:  Justice Dept New Rules for Corporate Fraud Prosecutions. 

Advising Clients on Company Blogs

For a great article on how to advise corporate clients on legal issues concerning company blogs, see:  As Blogging Grows, So Do Its Do's and Don'ts by Alysa N. Zeltzer and John E. Villafranco, Internet Law & Strategy, Feb. 20, 2007.  The article mentions such items as:

* Considering how the blog will effect the company's document discovery and retention obligations

* Establishing a corporate blogging policy and making sure employees are complying.  The policy should cover such issues as preventing defamation suits and preventing other information damaging to the company from getting on the blog. 

*Being mindful of making representations in violation of consumer protection laws

*Being mindful of privacy and information security laws

IRS Releases Suggested Governance Guidelines for Nonprofits

The IRS has released proposed guidelines concerning the governance of nonprofits.  While the IRS lacks the power to enforce these guidelines, they are expected to be influential nonetheless when a final version is adopted.  The proposed guidelines should prompt tax-exempt organizations to review their governance rules, organizational documents and compensation policies.  See IRS Releases "Suggested" Governance Guidelines for Tax- Exempts by Jerry O. Allen and Allan D. Duffy, Bricker & Eckler, Feb. 2007. 

"The guidelines address the following nine general topics: (1) Adoption of a Mission Statement, (2) Adoption of a Code of Ethics and Whistleblower policies, (3) Satisfaction of the Duty of Care/Director Diligence, (4) Satisfaction of the Duty of Loyalty/effective conflicts of interest oversight, (5) Constituent transparency, (6) Oversight of fund-raising activity, (7) Stewardship of financial affairs, (8) Payment of reasonable compensation, and (9) Adoption of a document retention policy."

IRS Releases Suggested Governance Guidelines for Tax-Exempt Organizations by McDermott, Will & Emery, 2/5/2007.  This articles has a link to a copy of the proposed guidelines, "Good Governance Practices for 501(c)(3) Organizations".  A copy is also available at the IRS Website.