Drifting snow, chiming bells, and rosy cheeks mark the beginning of our merry holiday season.  And many businesses anticipate the greatest holiday gift of all: the economic outlook has begun to turn rosy as well.

Economists and CEOs alike foresee an increase in sales and a growth in capital during 2010. However, while companies plan to rake in more cash next year they don’t necessarily plan to hire new help. According to Business Roundtable Quarterly, large corporation CEOs anticipate a year of healthy economic expansion but not a resurgence of hiring.

The year 2010 may find millions of recently unemployed Americans still struggling to find a place on the corporate payroll.  But many of these displaced business men and women will forgo the job search in order to seize a different opportunity: they will become entrepreneurs in a burgeoning economy, creating lucrative opportunities for themselves and others during a year of fiscal growth.

Austin, Texas is a hotspot for entrepreneurs for several reasons. It is the third fastest growing small business community with more than 30,000 small businesses (CNN Money). While the city of Austin is large and full of opportunity, its residents stay true to local brands and local businesses. Austin ranked as the #4 Best City to start a small business according to bizjournals.com, thanks to its business friendly tax structure, availability of financing, and robust and skilled labor pool.

While Austin may sound like a winter wonderland for building and growing a business, this doesn’t make it a simple process.  In a city where great ideas are constantly emerging, protecting your intellectual property becomes exceptionally important.  Gaining access to investment requires a great idea, a detailed plan, a “WOW” pitch and a network of interested investors.  And then successfully managing and growing your business requires dedication, hard work, and sometimes even a little extra help (Santa has elves for a reason).

A report by Dun and Bradstreet estimates that companies with fewer than 20 employees have a staggeringly low 9% probability of surviving ten years in business.  MWR Legal is a law firm dedicated to helping entrepreneurs and executives join this elite 9%.

We have years of experience helping myriad companies throughout all stages of their businesses – from the initial launch to perfecting pitches for investment, avoiding litigation to maximizing rapid growth (of clients, income and employees) and ultimately selling the business.

Please check out some of our success stories or simply call us to talk with our Director of Client Relations. We would love to discover how we can help you unwrap your own Entrepreneurial Gift and start, grow, and protect your business! 

Happy Holidays and best wishes to Entrepreneurs everywhere!

Contact Us

MosterWynneRessler
512-320-0601

We are proud to announce that a radio musical written by the firm’s Senior Partner Charles Moster will be featured this Sunday, September 13 at 11am on KUT’s (90.5FM) The Best of Public Radio.  The one act radio musical is entitled “Taken: How will they be remembered?” and provides a very personal depiction of the 9/11 tragedy.

“Taken” follows the life of Drew and Jenny, two young investment bankers whose life together begins and ends at the Twin Towers, along with several other characters. The music and and lyrics are melodic and touching and add a unique and special dimension to the story.

Please join us in listening to this tribute on Sunday morning at 11am on 90.5FM.  The piece will also air on Friday, September 11 at 6pm on Digital KUT2.

Very best,
Adam

www.mosterwynne.com
(512) 320.0601

One of the most fascinating and controversial legal decisions in the field of intellectual property is coming to a computer near you!  Charles Moster, the firm’s Senior Partner and writer/composer of several radio musicals on NPR, is releasing his latest on August 31st.  It is about the life of the brilliant Serbian inventor, Nikola Tesla, who invented radio and had a landmark Supreme Court case! 

Entitled Tesla vs. The United States, it tells the story of how political and economic pressure unfairly influenced a major decision by the U.S. Patent and Trademark Office (PTO).

Tesla invented radio, filed his application for the device with the PTO in 1897 and was granted a patent in 1903.  Subsequent to the filing, Italian inventor Guglielmo Marconi incorporated one of Tesla’s inventions – the “Tesla Oscillator” – to transmit the first radio signal across the Atlantic.  Marconi received enormous press attention and praise and erroneously promoted himself as the inventor of radio.  Marconi then tried to patent his radio device in 1900 but was declined by the Patent Office as it was based on the Tesla Oscillator.

Unfortunately, the rising value of Marconi’s financial interests in his wireless company and the support of such luminaries as Thomas Edison and Andrew Carnegie gave Marconi the political muscle to reverse the decision of the PTO in 1904.  The decision was inexplicable and contrary to its prior decisions and patent holdings.  To add insult to injury, Marconi was awarded the Nobel Prize in 1911 for the invention of radio!

It was not until 1943, shortly after the death of Tesla, that the U.S. Supreme Court reversed the unfair decision of the Patent Office.  Charlie’s radio play presents a musical accounting of this pivotal legal decision.

You can access the play online at www.noirdame.com during the premier on August 31st.  Charlie’s collaborator of many years, Adam Donmoyer, arranged the music, directed the play, and wrote the title song. Charlie wrote the book, music, and lyrics.

Don’t miss it!

www.mosterwynne.com
(512) 320.0601

Trademarks are used to protect a name, word, or symbol that is used for the purpose of identifying the source of goods or services.  Many economists have shown the direct relationship between the increasing importance of branding and the value of securing your IP - a lesson that the “Octomom” has clearly not missed!

According to CNN, the Smoking Gun and a number of other news sources Nadya Suleman, aka the “Octomom”, has recently filed two trademark applications and wants to put her moniker on television programs, clothing and disposable and cloth diapers. 

Here is what the Associated Press reported:

(04-15) 21:58 PDT LOS ANGELES (AP) –

“Octomom,” the nickname that has dominated headlines for nearly three months, could belong to Nadya Suleman alone.

The mother of octuplets wants to trademark her moniker and filed two applications with the U.S. Patent and Trademark Office on April 10.

The applications said Suleman wants to put the Octomom name on television programs, clothing and disposable and cloth diapers.

The octuplets’ birth on Jan 26 was heralded as a medical miracle, but the public’s fascination with Suleman quickly soured as details of her life emerged. The divorced and unemployed mother has six other children at home; she has said all 14 children were conceived through in vitro fertilization.

Tabloids called her the “Octomom” and the name stuck.

Suleman’s attorney, Jeff Czech, said two people have approached him with suggestions for products like children’s clothes and dolls.

“She doesn’t particularly care for the name but she thinks it’s a good idea to protect it,” he told The Associated Press on Wednesday. “She has a sense of humor about it.”

Czech said a Texas-based video game company called Super Happy Fun Fun, Inc. also filed a trademark application for the name. Its Web site describes a game in which players “press down on Fertyle Myrtle’s swollen belly, and another adorable bundle of joy will be brought into the world.”

The company filed its application about a month ago and did not ask for permission, Czech said. Typically, the first person to file an application receives the right to use the name, he added.

“But in this case, it’s more than just the name. It’s become a person,” he said. “When it becomes so associated with a name or a person, it is protectable.”

While it’s hard to get past the sensationalism, the Octomom’s situation does raise some interesting issues regarding trademark law ”best practices”.  For example, the story alludes to the importance of being the first to file your trademark application. 

You might not be on the cover of People Magazine or US Weekly but have you done everything that’s necessary to protect your brand?

www.mosterwynne.com
(512) 320.0601
Matt Burr is Intellectual Property Counsel of MosterWynne, a national corporate law firm headquarted in Austin that helps entrepreneurs and executives build their businesses.

As a health and benefits plan (ERISA) attorney, I want employers to understand that separation notices and the amount employers are now required to pay must change.  While there are tax credit reimbursements your cash flow will be impacted and you need to be prepared.  
 
As a business owner, I think significant change needs to be made to our health care system to take the burden off of employers.  This recent legislation does not address the core issue: that the costs of health care are exorbitant and companies, both small and large, are searching for a way to free themselves from this extraordinary burden.  

Our own insurance advisor, Cuatro Groos, has laid out the details of the new health care legislation in the article below. It’s lengthy but full of important details. 

Please feel free to contact me or Cuatro if you want to discuss these or any related issues.

Sincerely,
Shari

An Overview of COBRA and State Continuation Assistance Under The American Recovery and Reinvestment Act of 2009
By Cuatro Groos, MBA, MPAff, CIC
http://www.cuatrobenefits.com/

What is the Premium Subsidy?
While the debate over long-ranging health care reform in the United States heats up in Washington, American companies and thousands of Americans laid off in recent months are scrambling for options to maintain their insurance coverage.  Many are not aware of the subsidies passed in February by Congress as part of the stimulus package to help recently laid-off workers maintain their employer-based coverage.  

Under the American Recovery and Reinvestment Act of 2009 (ARRA), eligible individuals pay only 35 percent of their COBRA premiums and the remaining 65 percent is reimbursed to the coverage provider through a tax credit.  This premium reduction applies to periods of health coverage beginning on or after February 17, 2009 and last for up to nine months for those eligible for COBRA between September 1, 2008 and December 31, 2009.  

In states such as Texas, where state “min-COBRA” or state continuation programs exist for employers whose groups contain less than 20 employees, the subsidy also applies for the length of continuation for that state’s program to a maximum of nine months.  In the case of Texas, that period is six months.

On the whole, the COBRA premium subsidy provides sorely needed short-term relief for people most directly impacted by the economic downturn – if they know about it.  These provisions, like the entire stimulus package, were written hastily.  They place quite an administrative burden on employers, regulators, and carriers. 

It took months to get decent model notices and guidelines in place.  As a result, many employers have done a poor job of making laid off workers aware of the provisions.  As an insurance broker, I find myself convincing such individuals that I should not be selling them an individual policy as an alternative to COBRA before they verify whether they are eligible for the subsidy.  The majority of people that come to us are unaware of the program.

What Plans are Subject to the Premium Subsidy?
The COBRA premium reduction provisions apply to:
• All group health plans sponsored by private-sector employers or employee organizations (unions) subject to the COBRA rules under the Employee Retirement Income Security Act of 1974 (ERISA)
• Vision-only, dental-only, and “mini-med” plans offered by employers subject to COBRA rules under ERISA
• Plans sponsored by State or local governments subject to the continuation provisions under the Public Health Service Act
• Plans in the Federal Employee Health Benefits Program (FEHBP)
• Group health insurance plans that are required by State law to provide comparable continuation coverage (such as “mini-COBRA”)

What Do Employers Need to Know?
Plan administrators must provide notice of the premium subsidy to all individuals with a COBRA qualifying event between September 1, 2008 and December 31, 2009.   They can provide this notice separately or along with their standard COBRA forms.  Employers were required by mid-April to provide notice and a special election period to those whose qualifying event happened before ARRA was passed.

In the case of employers of firms with fewer than 20 employees in states such as Texas that have state continuation programs, employers are only required to provide notice for employees whose qualifying events occur on or after February 17, 2009. The Department of Labor has posted model notices for employers.

Employers have the option but not the obligation to allow eligible individuals to select a lower cost plan alternative to their existing plan if there is one at the time of enrollment in COBRA or State Continuation.

Documentation and Filing Requirements for Employers Subject to COBRA Rules
Employers subject to COBRA rules (or the companies hired to administer COBRA for them) are required to pay the 65% subsidy for eligible participants.  On a quarterly basis, these employers can file for reimbursement through their quarterly federal tax return.   

Although employers do not have to file anything else with the IRS for reimbursement on subsidies paid by the employer, it is important that they keep the following information on file to support the claims made on their tax reports:

• Information on the receipt, including dates and amounts, of the assistance eligible individuals’ 35% share of the premium
• In the case of an insured plan, copy of invoice or other supporting statement from the insurance carrier and proof of timely payment of the full premium to the insurance carrier required under COBRA
• In the case of a self-insured plan, proof of the premium amount and proof of the coverage provided to the assistance eligible individuals
• Attestation of involuntary termination, including the date of the involuntary termination (which must be during the period from Sept. 1, 2008, to Dec. 31, 2009), for each covered employee whose involuntary termination is the basis for eligibility for the subsidy
• Proof of each assistance eligible individual’s eligibility for COBRA coverage at any time during the period from Sept. 1, 2008, to Dec. 31, 2009, and election of COBRA coverage
• A record of the SSN’s of all covered employees, the amount of the subsidy reimbursed with respect to each covered employee, and whether the subsidy was for one individual or two or more individuals.

Documentation Requirements for Employers Subject to State Continuation Rules
For employers with 19 or less employees on their employer sponsored health plans, requirements are slightly different.  In states where state continuation or “mini-COBRA” provisions exist, insurance carriers have generally agreed to pay the 65% continuation premium subsidy for eligible participants and file for credit with their quarterly tax reports.  Employers, however, are being required to provide notice to eligible terminated employees as well as documentation on participating individuals to the carriers (see the list above for examples of the information carriers need).  Carriers are currently checking to be sure whether certain small employers with close to 20 employees are subject to COBRA or State Continuation rules.  Small employers should consult their carrier or agent for information on their carrier’s specific requirements.

Penalties for Non-Compliance
Employers subject to COBRA rules face the same penalties for non-compliance with the new subsidy provisions as with other COBRA rules- up to $100 per employee per date of non-compliance.  It is not as clear what, if any, penalties exist for non-compliance on the part of employers subject to state continuation rules in various states.  ARRA does not apply to individual states’ rules, so each state is on its own to draft and enforce rules on the matter.

Who is Eligible?
Anyone that was involuntarily terminated, became eligible for COBRA between September 2008 and the end of 2009, and elected COBRA is eligible for the premium subsidy to be applied to premiums on or after February 17, 2009.  Employers subject to COBRA were required to give all employees that became eligible since September 2008 but waived COBRA another chance to enroll in COBRA with the subsidy starting March 2009.  For the purposes of HIPAA and pre-existing condition waiting periods or exclusions, the amount of time such a second chance COBRA enrollee went without coverage before joining COBRA does not count against them. 

Even if the employee initiated the termination, it still might be considered “involuntary” and eligible for the subsidy.   According to the IRS notice on eligibility, this is the case “if the termination from employment constitutes a termination for good reason due to employer action that causes a material negative change in the employment relationship for the employee.”  In other words, if you quit because you were about to be laid off, you might still be eligible.

Who is Not Eligible?
The Department of Labor states, “those who are eligible for other group health coverage (such as a spouse’s plan) or Medicare are not eligible for the premium reduction.”  Moreover, for those individuals with modified adjusted gross income of $145,000 or more ($290,000 for those married and filing jointly), any subsidy received will have to be paid back to the IRS in full.  For those individuals with modified adjusted gross income between $125,000 and $145,000 ($250,000 and $290,000 for those married and filing jointly), the amount of premium to be repaid to the IRS is prorated.

Denials
In some cases, employees have been denied the ARRA COBRA Subsidy.  One major employer in Texas has denied the COBRA subsidy to terminated employees over the age of 50 on the grounds that they had access to other group plans and waived those options.  The employees had been offered and waived out of special retiree benefits plans in favor of COBRA on their regular employee plans.  The retiree benefit plans, ironically, were far more expensive than COBRA for such terminated employees.  It could be argued that denying such employees access to the subsidy runs contrary to the spirit of the law.   In plain English, it’s kicking older laid off employees while they’re down.  Employers have been encouraged by officials to err on the side of the employees when in doubt, and there could be legal challenges in cases such as this. 

For individuals who are denied the subsidy, there is recourse through the Department of Labor.  According to DOL, such individuals “who are denied treatment as assistance eligible individuals and thus are denied eligibility for the premium reduction (whether by their plan, employer or insurer) may request an expedited review of the denial by the U.S. Department of Labor. The Department must make a determination within 15 business days of receipt of a completed request for review.”   

What Should You Do if You’ve Been Laid Off?
If you’ve been involuntarily terminated from your job, first be sure that your employer has provided you with notices and election packets for COBRA.  In the case of employers with fewer than 20 employees in states such as Texas, look for state continuation packets.  If there is no mention of the premium subsidy in your notice, contact your former employer to find out why.  If you’ve been denied the subsidy, remember that you can request a quick review by the Department of Labor.

Alternatives to COBRA and State Continuation
If you don’t qualify for the subsidy, you cannot afford the subsidized COBRA/continuation premiums, or you’ve run through the full subsidy period, there are other options out there for health insurance and other lines of coverage.  After the full run of allotted time on COBRA, people in states such as Texas can often apply for state continuation if they still have no access to another group plan. 

If COBRA or state continuation rates are too expensive, you can also explore a spouse’s group or individual plan, individual health insurance, or temporary health insurance.  In cases where one cannot qualify for any group or individual plan, many states offer state risk pools as a carrier of last resort.  Consult a qualified insurance agent for advice on all your options.

Helpful Links
Department of Labor’s resource site for COBRA Continuation under ARRA for fact sheets, FAQs, and Model Notices:
http://www.dol.gov/ebsa/cobra.html

National Association of Health Underwriters’ Advocacy Page with ARRA Info:
http://www.nahu.org/legislative/COBRA/index.cfm

IRS Bulletin 2009-27 with info on ARRA COBRA Subsidy Program:
http://www.irs.gov/irb/2009-16_irb/ar09.html

IRS COBRA Health Insurance Continuation Premium Subsidy Info Page for Employers:
http://www.irs.gov/newsroom/article/0,,id=204505,00.html

www.mosterwynne.com
(512) 320-0601

Bankruptcy is not a process that should be feared by the American people – or by General Motors.  Sometimes it acts as a grim reaper.  Sometimes it has the power of the Phoenix allowing failed businesses to rise from their ashes.  But always it is the great equalizer which is precisely what Congress intended.

So why are GM and the country so afraid?  The answer appears to be very straight forward – loss of the company and the attendant jobs.  That’s arguably never a good thing. 

Consequently, in our bailout driven economy, there is much talk of the Treasury, a/k/a Santa Claus, waiting on the scenes for yet another golden delivery.  The great Greek playwrights had a most descriptive word for this process – deus-ex-machina, which means “chariot from the heavens”. 

In all of the amazing Greek dramas or comedies, mere mortals would run afoul of the Gods and get themselves into an intractable jam.  Brilliant playwrights the likes of Aristophones and Euripedes had no answer.  To keep the masses satiated and calm, a great mechanical chariot would descend from the ceiling of the theatre replete with an appropriately empowered and costumed God to resolve the crisis, and always successfully.  That was the power of the dues-ex-machina.

Unfortunately, there is no golden chariot available in a Chapter 11 bankruptcy reorganization.  I say this having been involved in some of the largest failed bankruptcies in the US, ranging from the steel industry to massive real estate conglomerates. 

Simply put, the purpose of Chapter 11 is to allow the honest and viable debtor to reorganize, with major emphasis on the words so noted.  Although there is much displeasure with GM’s management, no one as of yet has called their honesty into question.  The latter is the great concern.

At the heart of Chapter 11 bankruptcy is the legal requirement that the debtor propose a restructuring plan which is viable.  In bankruptcy jargon, according to the courts that means there is a reasonable prospect of a plan which can be successfully approved by the court and creditors.  On either side of this equation hangs the grim reaper and Phoenix, respectively. It’s up to the bankruptcy judge and creditors to make the fateful choice.

GM can make a good case for reorganization under Chapter 11.  But it will take more than a winning argument to persevere.  GM must demonstrate that it is worth saving.  Bottom line, the Chapter 11 bankruptcy process will allow the Debtor to rid itself of non-performing assets, product lines, and the like.  The juggernaut of Chapter 11 will require that labor contracts be adjusted downward so that all creditors have a chance to be paid and the debtor has a glimmer of hope at the end of the survival spectrum. 

But here’s the big question – is there gold at the end of this rainbow?  As a bankruptcy attorney involved in the government’s first TARP-like program to save the ailing U.S. steel industry and the attendant chapter 11’s which followed, I am entitled to weigh in on this issue. 

Bankruptcy was able to save some but not all of the steel factories. Unfortunately, decades and decades of mismanagement, failure to initiate modernization of facilities, and protectionist policies which rendered these steel producers unable to compete in the global market (emphasis on the Japanese steel industry), could not be overcome by the supposed magic of Chapter 11. 

The government lost 100’s and 100’s of millions, the companies reduced debt, and made some attempt to restructure.  It didn’t work.  Our legal system cannot force corporations to adopt more innovative financial models.  The steel industry was a relic of the 19th Century Industrial Revolution and could not reinvent itself.  Many of the same companies re-filed for Chapter 11, had further reductions, and still limp along today. 

Thousands of jobs have been eliminated over the decades and not replaced.  The steel belt is evidence of that – a fossilized relic of what once was.   Entire regions of the country know all about recession as they have been in that condition for decades.

And that is the lesson for General Motors.  I am all for this corporation taking the Chapter 11 leap and let the cards fall where they may.  Bankruptcy is the great equalizer and it is now time to turn its attention to the auto industry.

Please don’t misunderstand.  I am not cruel or callous in my calculation and absolutely want hard workers and their families to avoid hardship.  However, it is up to GM to demonstrate that it can rise from the ashes of horrific decisions and once again be a viable business. 

If it cannot, its divisions should be (and will) be liquidated.  In our competitive free market system, a new automobile industry will emerge from this vortex creating new technologies and viable/lasting employment for American workers.  In such a milieu, I can envision another Bill Gates or Michael Dell ready to launch a 100% non-fossil fuel vehicle that could amaze and capture world markets.  Watch out Toyota!

Moral of the story… the GM debacle has many of the elements of a Greek Tragedy.  However, in this new versions, sans the deus-ex-machina. 

www.mosterwynne.com
(512) 320-0601
Charles Moster is Senior Partner of MosterWynne, a full-service Legal Consultancy law firm that helps build businesses.

On Tuesday, March 3, 2009 the “Patent Reform Act of 2009” was introduced in Congress. This is the latest effort to pass this legislation, which has been knocking around Washington for years, into law. The 2008 version died in the Senate last year. It is thought by many observers to have a better chance of becoming law this time around.  In fact the bill was approved on April 2, 2009, in a 15-4 vote of the Senate Judiciary Committee. The bill now moves to the Senate floor.

With the prospect of eventual passage of the bill, let’s take a look at it and see what we’re in for.

The Bill has two overriding objectives. The first is to amend the existing patent statute (Title 35 of the United States Code) to bring it closer into harmony with worldwide patent practices. The second and more controversial objective is to address concerns about patent litigation and so-called “patent trolls,” which are outfits that do not produce any goods or services but instead own patents and then sue for infringement on those patents.

One of the most significant changes relating to the first objective of harmonizing US patent practice with the rest of the world is the change to a first to file system. This means that if there is a dispute between two or more inventors, who all claim the same invention in separate patent applications, the winner who gets the patent is the one who filed his patent application first.

Currently, if there is a dispute about who was the first to make an invention, the winner goes to the first to invent the invention. This means that, at least theoretically, someone who files a patent application after some else has filed for the same invention could prevail and be issued the patent over the first filer. 

As you can imagine, it is very complicated to determine whether someone made an invention before someone else.  It requires showing, in a formal proceeding called an “interference,” when the invention was conceived, when it was reduced to practice and whether diligence was exhibited between conception and reduction to practice.

The advantage of the current first to invent system is that it can benefit individual inventors or small companies that might not be sophisticated about patents. 

The advantage of the first to file system is that it provides a measure of certainty to the patenting process and thus makes the decision about whether to spend the money for a patent easier.

Among the disadvantages of the first to invent system are that some uncertainty is inherent and the interference proceeding is difficult and expensive.

Among the disadvantages of the first to file system is that it creates a race to the mailbox and favors (typically) large, sophisticated applicants who have the resources to file more regularly file applications.

As much as my personal sympathies are to champion individual inventors, you would think I would not favor the change to the first to file system. However, I do favor the change. I think the mechanism of the interference for determining the first inventor was appropriate before the information revolution of the World Wide Web, but it is now archaic. The web makes information easily available to almost everyone and levels the playing field substantially between sophisticated patentees and novices. Interferences have become so rare and are such an arcane practice area for attorneys that I think they will not be much missed.

I also think harmonizing our practices with the rest of the world is worth the reasonable trade off of the loss of the interference.

In my next posts I will look at the controversial litigation reform provisions that go after the patent trolls. 

In subsequent posts I plan to discuss the changes that will allow patents to be issued to corporations or other entities rather than to the inventor (will this change pass constitutional muster?) and I will also discuss the so-called patent opposition procedure.

www.mosterwynne.com
(512) 320-0601

As a bankruptcy attorney and former lawyer for the Feds, I feel compelled to point out the drawbacks of the current bailout to GM and other entities which might seek Chapter 11 protection.  The bankruptcy laws afford no special protection to taxpayers in a bailout situation.  As such, the massive outlay advanced by the American people may never get fully repaid in a Chapter 11 proceeding which is highly problematic.

The purpose of Chapter 11 is to allow the honest debtor to reorganize its debts and thus restructure obligations to creditors.   The process necessarily involves the reduction of creditor claims so that available assets can be more equitably distributed.  In most contexts that makes perfect sense.

However, the Bankruptcy Code recognizes special protection for discrete groups like the American taxpayer when a situation so warrants.  For example, taxes owed to the IRS cannot be discharged (i.e., eliminated) in bankruptcy.  Like the chains of Jacob Marley (a popular allusion during Christmas - wait - this is Easter!) the obligation follows the debtor for all time, at least while in this mortal realm.  

No such protection is afforded the taxpayer with respect to these massive bailouts.  Consequently, the billions and billions paid to GM may never be repaid in full. 

I highly recommend that Congress amend the bankruptcy laws to provide special protection to the taxpayer within the context of bailout situations.  An easy argument can be made that it is essential to safeguard the public treasury when dollars are used in such manner.  Seems to me that the billions loaned to GM should receive a higher level of protection than the typical secured creditor.

As a young lawyer for the U.S. Department of Commerce back in the 80’s, I personally observed how taxpayers ended up on the short end of the lending stick in monies paid out to the steel industry.  Tens of millions were never recovered.    With a little planning at the legislative level, this problem can be averted.

www.mosterwynne.com
(512) 320-0601

Imagine that you just stepped off the elevator having traveled 30 floors talking to the CEO at your top prospect.  You gave the most stirring elevator speech in the history of elevator speeches, and captured her imagination with your tale of cutting-edge technologies and memorable branding.

Much to your surprise, the CEO gets off the elevator and calls her friend at a company across town and now you have a new competitor.  Have you protected what makes you so unique?  Have you protected the business of your business? 

This may sound like lawyer-speak or the turning of a phrase which would be the nightmare of any fifth grade English teacher.  However, I have been a lawyer for over 22 years and have represented clients including Uncle Sam, huge corporations, small startups and 100’s of emerging businesses in nearly every industry from technology to trucking.  I have found that all too often companies fail to understand and appreciate the critical importance of protecting their intellectual property rights – the business of their business.    

By “intellectual property” I mean the creative products of your imagination.  I’m a lawyer but I’m also an inventor, playwright and composer so I understand the intrinsic value of creating something that never existed before.  However, I also know that you need to take steps to protect your novel idea, brand, technology before you can translate that value into sustainable revenue.

When talking with our clients we first define what intellectual property is and what they can and cannot legally protect.  Patents, copyrights, trademarks and tradesecrets are all in the mix.  Then we discuss the role the IP will have in their business model and how it will affect their ability to create revenue.  It is important that we scale their level of protection and legal investment based on their current needs and growth plans because not every company needs everything filed at once. 

Having secured your IP rights allows you to work both offensively and defensively.  Sadly, some people are born with what I call “perforated halos”.  Their business model is to steal your technology and employees, trade off the goodwill your brand creates in the market, and essentially grab whatever they can. 

Don’t let them get away with it!  Protecting your IP allows you to be offensive in your pursuits of infringers.  I’m not advocating suing everyone who comes along because litigation is very rarely the best option, but if you haven’t taken the steps to protect your assets your position of strength is diminished.  Plus, not every dispute ends in lengthy and expensive litigation.  Many companies strike win-win licensing deals with former infringers and create new revenue streams. 

Protecting your IP rights also lets you be offensive in your pursuit of business and strategic/channel partners, licensees, investors, and acquirers.  Anyone who has talked with a potential partner, licensee, investor, and acquirer knows that whether or not you have protected your IP is always an initial question, if not the very first one.  Your ability to garner interest from these groups and negotiate a higher price, royalty, valuation goes part in parcel with the investment you’ve made in your patents, copyrights and trademarks. 

If your technology isn’t camera ready, have you considered a provisional patent and the “Patent Pending” label you can use?  If your product launch isn’t for several months would an Intent to Use trademark application ease your concern about losing the name in the interim?   

Intellectual property is also a tremendous competitive advantage.  Novel, patented technology can create high barriers to entry, and if you combine it with a strong, trademarked brand you can intensify customer loyalty and improve your ability to charge price premiums. 

Our firm is focused on being a positive force and avoiding the focus on fear – there’s plenty of that to go around already.  However, the defensive value of IP is just as important to help you avoid costly and sometimes catastrophic issues. 

For example, before you invest the time, emotion and thousands of dollars into a new brand and marketing campaign consider a trademark search and filing.  Unfortunately, on several occasions clients have come to us with a growing business (great news) but also a nasty cease and desist letter from a lawyer halfway across the country threatening our client with infringement (not so great news).  Sometimes we can prevail but sometimes the client has to completely scrap their name – along with the untold value of the brand they’ve worked so hard to create!  Uggh.

There are countless reasons to protect the business of your business, more so than the word limit on this post.  Intellectual property is a complex area of law, but the rationale for pursuing the protection it affords is not.

www.mosterwynne.com
(512) 320-0601

I’ve always been fascinated by time travel stories which often deal with the possibility of alternative histories.  In the typical story line, a time traveler journeys back in the past and accidently changes the course of history.  The potential outcomes are fascinating.  What if the South prevailed during the Civil War?  What if the Germans in WWII had successfully completed their nuclear research and produced the first atomic bomb?  What if Monica Lewinsky passed up that opportunity to work as an intern in the Clinton administration?  I would surmise that Al Gore would have been elected President in 2000 and a gentlemen named Barack Obama would be a fairly obscure junior Senator from Chicago.  And so on.

Well, try this on for size.  What if the Library of Alexandria had never been sacked and burned to the ground?  That alternative history might have changed the world as we know it more than any other event.

The Library of Alexandria was built in the third century BC and supposedly conceived of by a student of Aristotle.  It was the world’s first library and was said to contain a massive collection of scrolls from the ancient world. 

This was the time of the golden age in Greece which gave birth to such luminaries as Socrates, Aristotle, Plato, Aristophanes, and Archimedes.  These brilliant scholars invented the Scientific Method which is the foundation of modern science.  Philosophers speculated on the nature of the universe, logic, and set the stage for modern medicine and physics.  Playwrights and poets performed their works in elaborate theatres built into the rocky countryside.

All of this knowledge was deposited in a singular location which was…. burned to the ground much like the Taliban destroyed the ancient statues in Afghanistan, a wonder of the world obliterated because it was deemed inconsistent with this radical variant of Islam. 

Who destroyed the Library of Alexandria?  Well there a lots of suspects representing the major power brokers including the Romans, Christians, and Muslims.  Although attribution for this horrific act is often conferred upon the Muslims who conquered Egypt and its environs in the year 642 AD it could also have been accomplished by Julius Caesar himself in 48 BC (accidently, I might add) or at the behest of a Christian Emperor in 391 AD charged with eradicating any evidence of pagan society, i.e., all science and culture prior to the birth of Jesus.

For those who have read the great literary works of Sophocles (Oedipus Rex), the brilliant philosophical treatises of Aristotle (father of life sciences) or Plato (philosophy), or the scientific musings of Hippocrates (father of modern medicine) you will find this fact as surprising as it is jarring.  Only a small fraction (under 5%) of these works survived the great sacking/fire/destruction of the Library of Alexandria.

Now, imagine what could have been deposited in that library?   Hundred of plays by Sophocles, untold treatises by Plato or Aristotle, and scientific writings of which we can only speculate.  One of my heroes of modern science, the late Carl Sagan, often speculated what the world of today would be like if this remarkable library and body of knowledge had not been lost.  Sagan thought that all of our marvels from electricity to genetics to computers to spaceflight would have been accomplished over two thousand years ago! 

Think about that for a second.  In this alternative history it is more likely than not that all disease would have been eradicated long ago.  Cancer would be viewed as threatening as a common cold.  Human lifespan could be in the hundreds or thousands of years- and most important- maybe mankind would have discarded its primitive instinct to murder other human beings eons ago.

So why this speculation?  Truth be told, I don’t prefer the timeline in which I was born.  I know this is a very odd statement, but sometimes it seems like my predecessors took a horribly wrong turn somewhere.  Most of all, it feels like we got cheated somewhere along the line.

At the very least, this time travel/alternative universe speculation fires up my imagination and opens the creative door to so many possibilities of what humankind can become.  Once upon a time, the human mind was able to transcend its limitations and primitive tendencies.  For a brief period in our history, we transformed the world and ourselves.

That same spark of genius and hope exists today.  So does our insatiable desire to suppress, kill, and conquer.  Where is the next great library of knowledge… and will it be sacked or saved? 

Think about it.

www.mosterwynne.com
(512) 320-0601