Economics of Litigation of the GNU GPL

Jun 30

The GNU General Public License (GPL) has been a hot topic, for both good and bad, ever since it was introduced to the world by the Free Software Foundation by Richard M. Stallman. Regardless of which side you argue, there has been very little case law or legal precedent established in the intervening years. One major reason for the dearth of cases related to the GNU GPL is that it is an economic zero sum outcome. As the focus of my final paper in my Business Law class, I chose to explore what litigation there has been and what it established with respect to the GPL. Surprisingly, of those cases that did involve the GPL and were started, very few actually ended up in court. In other words, they settled out of court. Here is my final paper. You can download it here: Economics of litigating the GNU General Public License...

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Merchant Issues Related to UCC

Jun 15

The last lecture in my Management Law course was lively and interesting. It centered on the UCC and gave particular emphasis on the merchant to merchant dealings. There was particular emphasis on Sale and Lease sections and some discussion around the original vs. the revised, which addresses contemporary issues related to e-commerce and electronic communication. What was interesting is that the formality and rigidity which is characteristic of law in so many other contexts cedes to predictability and flexibility. In other words, the UCC wants to make business easy and remove as many inhibitors. As a result, many of the questions that arise in merchant to merchant cases center around past dealings and industry averages. This may result in cases where there was no contract, but there can still be a definitive ruling. Another aspect of the UCC for merchants is that it favors resolution outside of court. With the less rigid structure of the guidelines governing merchants, it’s not as easy to clearly identify breach. If breach isn’t absolutely clear, the cost of litigation is a risky bet. So it seems there is opportunity for broad interpretation of the UCC when it comes to merchants. Bottom line? Take the time to choose vendors, suppliers, contractors and other partners that you trust and establish a good track record. If you keep the lines of communication open and have well established policies, you may not even need to review the UCC....

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Principals and Agents

Jun 07

The law surrounding relationships in business has its heart in Principals and Agents. There are various ways that these relationships are formed. The most common are Employer, employee Independent contractor The most common formation involves Express Agency. That means that both parties agree on the terms of the principal agent particulars. This may include exclusive agency, where the relationship is limited to the original parties for the purposes set forth in the contract. There are other types of agency, including implied agency, agency by ratification and power of attorney. While the implied and ratification formation mechanisms are less specific in terms and timing, power of attorney is a deliberate transfer of (often specific) rights to legally act on behalf of the principal. Agents duties include to perform as agreed, notify the principal of relevant information related to that performance and account for expenses and other pertinent information related to his activities. Principal’s duties It is expected that the principal, as well as the agent, has specific duties and responsibilities after the formation of an agency relationship. These include duties to reimburse, indemnify and cooperate. The professor shrugged a bit on this topic explaining that in her professional course as a practicing lawyer the overwhelming majority of agency related cases had to do with the agent, not the principal. Termination There are many circumstances that can bring about the termination of a principal-agent relationship. These may include Act of the parties Unusual change in circumstances Impossibility of performance Operation of law There are also times when wrongful termination occurs. In these cases, the agency relationship is terminated, but remedies may be available in court, such as damages to cover benefits that were anticipated under the principal-agent relationship as specified in a...

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Remedies for Breach of Contract

Jun 07

At the end of lecture the other day the professor added, with emphasis, that “Chapter 16 is very important┬áto the rest of the course“. The topic of the chapter is Remedies for Breach of Traditional and E-Contracts. Performance and Breach The chapter contains starts of with a discussion of performance and breach. It was interesting that a distinction was made between ‘complete’ and ‘substantial’ performance. In other words, if one party to a contract completes most of the terms, the contract may be substantially performed. This would give rise to a minor breach. In other words, the court or jury are likely to consider partial remedies that related to the minor breach, rather than treat it as a full breach. The spectrum of possibilities deviates from the black and white view often given to contracts. Damages There are various ways to look at damages. This range from very little to enormous and serve various purposes. A summary list of types of damages should include Monetary damages Compensatory damages Consequential (or special) damages Nominal damages (typically $1) Liquidated damages (or penalty) Mitigation of damages was new to me. It makes perfect sense, but I didn’t know it had been articulated in the law. Mitigation of damages suggests that the person not in breach of the contract has a responsibility to reduce the overall damages if possible. For example, if I have a work contract with a term of three years and I’m laid off after one year, then I’m entitled to damages of pay equal to what I would have made during the remaining two years unless I find other employment equivalent to what I lost. Under mitigation of damages, I’m required to look for work to reduce the overall damages to the breaching party (my previous employer). If I don’t look for work, they may be able to get a reduction to the overall damages at court. Remedies and Torts The remainder of the chapter discusses remedies and torts related to contract law. Among remedies are garnishment of wages, compelling to perform, etc. Torts include intentional interference, covenants of good faith, etc. These play out much like you might...

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Patent and Copyright Law

Jun 03

Patent and copyright law are essential to a free market system. They were important enough that specific powers to enforce protections for inventions are built into the constitution of the United States. It could be that some of the prolific inventors of the time, such as Benjamin Franklin, pushed for such measures, and the sentiment must have been shared. Below is a presentation that shows a contemporary view of patent and copyright law and litigation. The presentation discusses two cases involving companies such as Samsung, Apple, Barnes & Noble and Amazon, among others. In the case of Amazon and Barnes & Noble, the matter was settle out of court. In the case of Samsung vs. Apple, the number of cases currently being prosecuted is growing. Questions One question to ask is at what point does litigation diminish the returns that are anticipated from an intellectual property system? Another might be at what point are the arguments beyond the expertise and ability of a judge or jury to reasonably determine a winner in a patent infringement case? These questions will increasingly weigh on decisions about when and how to litigate patents in courts of...

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