A recent survey by AlixPartners found that corporations are directing their attention to finding ways to proactively manage potential risks. In the face of rising litigation and regulatory enforcement actions, corporate compliance and legal departments throughout the country reported that their efforts are going towards implementing education and training programs to reduce litigation risk. AlixPartners' 2014 Litigation and Corporate Compliance Survey polled general counsel and compliance officers from more than twenty major industries including insurance, financial services,...

What is the difference between a merger and an acquisition?  The terms “merger” and “acquisition” are common business terms, but they are often inappropriately used interchangeably, when in fact the two transactions are rather different. If you are planning to combine or purchase assets from another company it is imperative that  you understand the benefits and drawbacks of each. Merger In a merger, usually two or more businesses wind down as separate entities, and then a...

Consumer review based websites like Yelp have grown in popularity and power. Consumer voices are often trusted, and a bad online review can have costly consequences. However, online anonymity has led to abuse, and if someone has posted an online review about your business that is false there may be legal recourse for your injuries. Defamation is an action brought to defend reputation. It involves intentional publication of false, defamatory, and unprivileged information that has...

Generally, corporate shareholders cannot be held liable for the acts or debts of their corporation because liability is specifically limited to their investment in the corporation via the purchase of shares. However, a shareholder may be held personally liable if a court permits another party to “pierce the corporate veil” to avoid fraud or unfairness to as a result of circumstances where the corporation has taken advantage others of by abusing corporate protections. Because there...

Generally, a corporation’s articles may limit directors’ personal liability for money damages to a corporation or to its shareholders for actions taken or for failure to take action. However, the articles may not eliminate liability for a director’s breach of duties owed to the corporation. For example a corporation’s articles cannot eliminate liability for receiving financial benefits to which the director is not entitled, intentionally inflicting harm on the corporation or its shareholders, unlawful...

A fiduciary relationship is about trust and confidence; it exists where one or more parties are bound to act in good faith toward and for the benefit of one or more other parties.  A fiduciary relationship is often comprised of the duties of care, loyalty, confidentiality, and obedience, i.e., fiduciary duties to the parties in the relationship. Before a person can be charged with a fiduciary obligation, he or she or it must either knowingly undertake...

Every day more companies move towards cloud computing, but recent cyber-attacks have raised questions about security and reliability. Several other legal considerations have been raised, and it is therefore important for businesses considering this path to make sure to weigh the legal factors as well as cost benefits. There are many reasons why companies are switching to cloud computing. According to the National Law Journal, some experts think that cloud computing could cut corporate IT costs by...

A business should always be prepared for a lawsuit, and the best time to prepare for one is before any possible legal claims arise.  Corporate compliance can go a long way in preparing for and avoiding a lawsuit.  If a business has a self-monitored corporate compliance plan and audits its own practices consistently, it will not only avoid potential lawsuits, but have self-preserving support in the case of a lawsuit. Organization Organization is the most important...