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Austin Business Organizations Law Blog

Cheering On Useful Articles

The Copyright Act of 1976 was created to protect original works with artistic qualities such as literature, music, screenplays, etc. However, the Copyright Act does not protect "useful article[s]" which are "article[s] having an intrinsic utilitarian function that is not merely to portray the appearance of the article or to convey information." 17 U.S.C. §101. However, what happens when a useful article has some artistic features? In this instance, the Copyright Act allows protection of the artistic features of a useful article if these artistic features "can be identified separately from, and are capable of existing independently of, the utilitarian aspects of the article." 17 U.S.C. §101. However this language sparked different tests throughout the circuits on when a feature can be identified separately and survive independently. This year, the Supreme Court of the United States took up a case that looked at what was the appropriate test to determine when a feature of a "useful article" is copyrightable under the Copyright Act.

Understanding Alternative Dispute Resolution: Mediation

Here at Taylor Dunham and Rodriguez LLP we pride ourselves on our litigation skills in the courtroom, but we also seek other avenues to solve a client's problem. At Taylor Dunham and Rodriguez LLP we are also accomplished in the realm of Alternative Dispute Resolution.

How Confidential are Settlement Agreements?

Most civil litigation ends in settlement. These settlements are usually entered and enforced through a signed settlement agreement. One of the most common (and important) clauses of these agreements is a confidentiality clause. This clause is primarily inserted to ensure the amount of the settlement is prevented from becoming public. However, a confidentiality clause is not enough to protect the settlement agreement from future discovery requests.

Customer Lists and the Texas Uniform Trade Secrets Act

Customer lists are important assets for companies. They provide crucial leads, a history of consumers' purchases, and other important data. Before the enactment of the Texas Uniform Trade Secrets Act, determining whether a customer list met the definition of a trade secret was complicated and required a heavily factual analysis. However, when the Texas Legislature enacted the Texas Uniform Trade Secrets Act (TUTSA) in 2013, it was clear that the legislature considered customer lists trade secrets. TUTSA defined trade secrets as "information, including...list[s] of actual or potential customers." Tex. Civ. Prac. & Rem. Code § 134A.002 (6). Despite this clear inclusion as information worth protecting, customer lists must still meet the requirement of including information that is not "readily ascertainable" to be considered a trade secret. Tex. Civ. Prac. & Rem. Code § 134A.002 (6) (A).This blog will look at what information should be included in your customer list to ensure it qualifies as a trade secret and two exceptions to the "not readily ascertainable" requirement.

Creditors Beware: Preferences and You

The old saying goes, "Patience is a virtue." However, it is often hard for creditors seeking payment from a financially distressed debtor to put these words into action, but they may benefit from doing so. Why? Because becoming overzealous and accepting or demanding a payment from a financially distressed debtor to the creditor may be an avoidable preference if the debtor files for bankruptcy soon after. This blog post will detail what a preference is, the consequences of enjoying a preference, and exceptions created by the Bankruptcy Code. 

Adequate Protection for Undersecured Creditors: The Basics

One of the reasons people file for Bankruptcy is to enjoy the protection of the automatic stay. What is the automatic stay? The automatic stay prevents creditors from taking any actions to collect from the debtor. The automatic stay is often problematic for creditors, especially secured creditors facing a debtor in Chapter 11 or Chapter 13 Bankruptcy, who are concerned the value of the collateral will decrease over time while the debtor attempts to complete their payment plan. Fortunately, the Bankruptcy Code allows undersecured parties an opportunity to lift the stay "for cause including the lack of adequate protection" after providing notice and attending a hearing. 11 U.S.C. § 362 (d)(1).

Is Your Non-Compete Agreement Enforceable?

Today it is not unusual for an employment contract to contain either a non-competition clause or a non-competition agreement. A non-competition agreement allows an employer to restrict an employee's post-employment opportunities by restricting the ability to immediately work for competitors or form a competitor. However, for non-competition agreements to be enforceable in Texas they must follow specific statutory guidelines. Here, at Taylor Dunham and Rodriguez LLP we pride ourselves on being experts in this area of the law and are often retained by businesses, as well as executives and employees, to handle legal disputes regarding non-competition agreements.

Don't Lose Your Priority By Failing to File a Continuation Statement

By creating and perfecting a security interest in a debtor's collateral, a creditor creates priority in the collateral in case of default over other interested parties such as: unsecured creditors, subsequent secured creditors, judicial lien creditors, and the powerful trustee in bankruptcy. For most collateral, simply filing a proper financing statement (such as a UCC-1 financing statement) is the easiest way to perfect a security interest.

Overcoming the Business Judgment Rule in Texas

The Business Judgment rule allows corporate officers and directors to avoid being held personally liable for business decisions made in good faith with honest motivations, but with unfortunate results. This rule has prevented shareholders from brining derivative suits against officers/directors of a corporation for breaching their fiduciary duty when they make an honest decision that does not pay-off. However, the Business Judgement Rule is not all powerful. In some circumstances it does not apply and even when it does, there are ways to overcome it. This blog is designed to give a brief overview of the Business Judgement Rule and how it can be overcome in Texas.

When Do Fiduciary Duties Shift to Creditors in Texas?

Typically, a corporation's directors and officers only owe fiduciary duties to the corporation and its shareholders, but not to the corporation's creditors. However, Texas Courts have consistently held that fiduciary duties can shift from shareholders to creditors when the corporation begins to experience financial turmoil. Unfortunately, Texas Courts are split on what financial turmoil is enough to trigger this shift. This blog post will detail the split within the Texas Courts of when the shift of fiduciary duties is triggered.

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