November 7, 2018

Divorcing your business-partner spouse

Partners in a business never want a dispute to have to be resolved through litigation. It is expensive for both sides, it can be long and it can be emotionally draining. But what if the partner that you are splitting ways from used to be your spouse? What if there are angry, bitter feelings that are keeping both sides from wanting to step down?

This appears to be the case in a messy dispute between fashion designer Tory Burch and her ex-husband. Reportedly, the couple married in 1997 and a few years later Tory decided that she wanted to try launching a fashion line. The couple went to work and after launching in 2004, the designer was invited on Oprah. The business took off and the marriage fell apart. The former spouses and business partners each remained on the board post-split, but after the divorce things became complicated.

Tory’s ex-husband’s new girlfriend started a line that allegedly looks strikingly similar to Tory’s designs after Tory’s ex-husband was asked to step down from the board earlier this year. The former spouses and business partners have been engaging in a heated battle involving lawsuits, counter lawsuits and a court battle that the judge presiding over the case called a “drunken WASP fest.”

Unfortunately, this dispute is ultimately hampering both sides and not making the business more profitable. However, the still-thriving brand has over 77 stores around the globe and projected annual revenues of $800 million, so it is hoped that this dispute can be resolved.

There are a lot of business issues at play in this case. Between the litigation, the partnership disputes, the potential infringing of Tory Burch designs all mixed in with a messy divorce, this case is enough to make anyone’s head spin.

Unfortunately, even the best of marriages can meet the worst of ends, and in some instances it is critical to retain not only an experienced family law attorney but an experience business law attorney as well.

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November 5, 2018

Pay for delay deals discussed in Supreme Court

Supreme Court justices listened to arguments about the advisability of reverse settlement deals between generic drug makers and the pharmaceutical companies their products often emulate. The U.S. Justice Department claimed that these agreements add to drug company profits at the expense of consumers.

The settlements occur when firms that make generic drugs file official patent challenges with the Food and Drug Administration. By proving that patents on brand-name pharmaceutical products are invalid, they gain the right to market their own generic versions before the 20-year patents expire. Pharmaceutical companies often launch their own lawsuits in return. Because such commercial litigation often leads to expensive proceedings that can take years to complete, many firms simply settle and let the generic competitors market their products after a shorter delay than the patent would originally provide. These settlements also generally incorporate large payments to the generic firms.

Consumer advocates and the American Medical Association all claim that these reverse settlement deals are nothing more than monopoly profits being split. They also argue that such deals increase the prices of life-saving drugs for ailing patients. While the Supreme Court justices who heard the arguments wouldn’t go as far as to stop the deals completely, they did express concerns about their anticompetitive nature and proposed legislative solutions.

Firms with intellectual property to protect may not be able to rely on their patents alone. Issues like prior art and overlapping practice open the doors to legislative competition, and as this case demonstrates, the effects on consumer markets may lead to increased regulatory interest or restrictions. As a result, many firms consult with business attorneys before structuring their own deals or agreements in order to keep up with legal changes while maintaining their profits.

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