January 31, 2008

Helpful Links

During the course of our business litigation and transactional work here at Atkinson Conway & Gagnon, we often investigate corporations, including making sure they are registered to do business in Alaska, that they are properly licensed, and identifying their officers, shareholders, and registered agents.

A valuable (and free) research tool is the Department of Commerce's Corporations Database. Anyone can use this (free) database to look up corporations registered in Alaska, determine when it was created, make sure it is in good standing, and find out who its shareholders are, as well as who is serving as officers, directors, and registered agent. Oftentimes, a corporation’s biennial reports are also available to download (again for free).

You can search the Corporations Database by name, by their Alaska Entity #, by registered agent, or by the name of their officers.

Another valuable tool is Department of Commerce’s business license search engine, which is also free and can be used to make sure that the company you are about to sign a contract with is actually licensed to operate in Alaska.

January 31, 2008

New Office/Retail Building Nearing Completion

One of Atkinson, Conway & Gagnon's favorite clients, Ruby Investments, Inc., is getting close to finishing up the construction of a new 15 story mixed use office/retail building in Midtown Anchorage. The project is a known as 188 West Northern Lights, which not coincidentally is the building's address. (Clever thing, that!) It's a terrific project that will have some unique architectural features to dress up Midtown. The building's location, at the intersection of Northern Lights Boulevard and C Street, will make it a real landmark right at the main crossroads in the heart of town. We put together the architect's contract and the construction contract for Ruby Investments and we helped them negotiate those deals.

As with most large real estate developments, this one was not without its little hiccups. But it was all worked out through the art of negotiation and the application of a bit of brain prowess in crafting the necessary documents. Now the building is nearing completion and Ruby Investments is lining up tenants to move in and enjoy the great location and swanky new building. Check out the live web cam of the project: 188WNL Cam

We're proud of the small role we played in helping the Ruby Investments team bring this project together. It's just another example of how a lawyer can have a positive influence on a client's business. (Excellent thing, that!)

January 29, 2008

US Supreme Court Limits Banks, Law Firms, and Accountants' Exposure to Aiding and Abetting Liability

In today’s specialized and interconnected business world, banks, law firms, and accountants often find themselves drawn into litigation over financial statements that are either incomplete or false. The Enron and WorldCom cases are great examples of this. In those cases, plaintiffs, often shareholders and creditors, sue law firms, banks, and accountants, alleging that they are liable for their losses because they “aided and abetted” directors and officers who defrauded the company and shareholders. Atkinson Conway & Gagnon has litigated these claims on several occasions in Alaska, both in the course of defending banks and law firms and in representing corporations against accountants that have aided company officers and directors in defrauding the corporation.

This theory of liability, also known as “tortuous assistance of breach of fiduciary duty” can significantly expand the liability of accountants, banks, and law firms, including exposing them to joint and several liability in states that otherwise provide for strict allocation of fault, such as Alaska.

On January 15, 2008, the United States Supreme Court issued an important decision limiting the scope of “aiding and abetting claims.”. Ruling 4 to 3, the United States Supreme Court held that Section 10(b) of the Securities Exchange Act of 1934 did not authorize a private right of action against third parties for aiding and abetting violations of securities law. Instead, plaintiffs who wish to sue banks, accountants and law firms for securities law violations must show that they relied upon an affirmative material misrepresentations by those entities. While banks, law firms, and accountants may be subject to aiding and abetting liability when they have a direct relationship with aggrieved plaintiffs, this is an important decision that limits the liability faced by banks, accountants, and law firms in the shareholder lawsuits that are so often filed when negative financial information is released by corporations.

January 29, 2008

Exxon Valdez Supreme Court Briefing

Atkinson Conway & Gagnon and all Alaskans are carefully watching the litigation arising out of the Exxon Valdez oil spill. After more than eighteen years, the case is still active. In late 2006, the Ninth Circuit affirmed a $2.5 billion punitive damage award against Exxon. With interest, the total punitive damage award against Exxon is estimated to be in excess of $4.5 billion. As expected, Exxon has appealed this decision to the United States Supreme Court.

The primary focus of Exxon’s appeal is the argument that punitive damages were not available under traditional maritime principles. Exxon is not seeking to just reduce the punitive damage award, but eliminate it entirely. The United States Supreme Court has a short summary of the issues it will be deciding.

Oral argument before the United States Supreme Court is scheduled for Wednesday, February 27, 2008. Below are links to the Supreme Court briefs that have been filed, including amicus briefs. Whatever the Supreme Court’s decision, it is certain that all Alaskans will be closely following this case and that it will have substantial impacts on both Alaskans and the law governing the availability punitive damages.

Primary briefs

Exxon's Appeal Brief

Plaintiff's Appeal Brief

Amicus Briefs

In support of Exxon

Chamber of Commerce amicus brief

Transport and Shipowners amicus brief

American Petroleum Institute amicus brief

Washington Legal Foundation amicus brief

Product Liability Advisory Council amicus brief

In support of Plaintiffs

Alaska Legislative Council Amicus Brief

Senator Stevens, Senator Murkowski, and Representative Young's amicus brief

January 29, 2008

Indemnity Clauses Mean Money

The topic of the day rattling around this end of Atkinson, Conway & Gagnon is indemnity clauses in contracts for business transactions. Just about every contract has an indemnity clause and hardly anyone other than the lawyers really cares. But I'm here to tell you that indemnity = money. Write that down, folks. When you think of indemnity clauses that way, it's worth paying attention to them.

Hey, I understand there are many, many more interesting things out there on the World Wide Web than reading what a nerdy business lawyer has to say about the nuances of indemnity clauses. I mean, you could be on eBay right now bidding on a vintage Roy Rogers metal lunch box with the matching thermos! (The dome lunch boxes are especially cool; search for one here: eBay) But if you happen to be in the middle of a business deal, taking a few moments to ponder indemnity clauses is probably more productive.

What the heck is indemnity anyway? Indemnity means that you (the indemnitor/sucker) has to pay for some sort of a loss that is visited on the other guy in your business deal (the indemnitee/smart guy). Typically, the loss involves a third person who sues the indemnitee/smart guy for something bad that happened. Or something bad that the third party thinks happened because, as we all know, you have to start hemorrhaging money to defend any lawsuit even when the claim asserted does not actually amount to a hill of beans.

But is indemnity limited to third party claims? Not necessarily. In some states, the word "indemnity" has been interpreted to mean that the indemnitee/smart guy can pass off on you some direct monetary loss he suffers that does not involve a third party claim. In other states, indemnity is usually interpreted to refer only to third party claims. In Alaska, the answer is unclear since the Alaska Supreme Court has never directly spoken to the issue. This means the indemnity clause in your Alaska contract needs to be carefully written to spell out whether it just applies to third party claims or also extends to direct losses. If your indemnity clause is not carefully written, then when a dispute over the indemnity obligation arises, you will find yourself sucked down the swirling bowl of the common law, waiting for some judge to pronounce what the clause in your contract actually means. That common law process is going to spit you out many years later, probably with an answer you did not expect, and certainly with a thinner wallet from paying your lawyer to argue the point in court.

But what about the situation where the indemnitee/smart guy is totally at fault for whatever loss he suffers? The law can't require you to indemnify that jerk for his own fault, can it? That must be covered in the U.S. Constitution somewhere, like maybe in some penumbra to the Bill of Rights? Well, unfortunately, penumbras to the Constitution have fallen out of favor these days. Alaska law actually will allow that jerk to make you pay for his mistake. That is, if the indemnity clause in your contract requires it (and if you are not dealing with a contruction contract). The cure to this problem is, again, carefully writing the indemnity clause so that the jerk on the other side of your deal has to twist in the wind on his own if it's all his fault.

So don't skip over that boring old indemnity clause in your business deal. If you don't make sure it's written correctly, whether you are the indemnitor/sucker or the indemnitee/smart guy, it is likely to end up costing you money. That's less money you'll have to spend on cool stuff like vintage metal lunch boxes. (Let me know if you run across a good deal on a Jonny Quest box).

January 28, 2008

Commercial Real Estate Market

The commercial real estate market in Anchorage is headed upwards, or maybe it is actually going sideways. The economic forecast that Neil Fried presented at the BOMA Anchorage luncheon earlier this month called for continued economic growth, just at a slower pace than earlier years. Vacancies in the office and warehouse market continue to be tight. A handful of new commercial buildings are nearing completion that may loosen things up a bit. Once the new buildings come on line, however, there is not a whole lot on the drawing boards yet for new commercial projects, aside from a large office tower in Downtown Anchorage that is in the works. Check out the recent BOMA Anchorage presentations here: BOMA Anchorage

We always have an eye on the local commercial market to keep up with our clients. In helping a client buy, sell or lease property, its helpful to know which way the market is headed. Timing can be everything in getting a deal put together and closed. This is why we make a conscious effort to get the legal work done promptly.

January 24, 2008

Atkinson, Conway and Gagnon Attorneys Selected As Super Lawyers

Several Attorneys with the law firm of Atkinson, Conway & Gagnon, Inc. were recently selected to be listed in Alaska Super Lawyers 2007, a publication of Washington Law & Politics magazine.

Not only selected as one of Alaska's Super Lawyers, Bruce E. Gagnon was selected as one of Alaska’s Top 10 Lawyers by the publication. Mr. Gagnon has practiced law with the firm since 1970. He received a J.D. degree from Harvard University in 1967, where he was an editor of the Harvard Law Review. Before coming to Alaska, Mr. Gagnon was an Assistant Professor of Law at the Vanderbilt Law School. Mr. Gagnon is recognized as a leading attorney in Alaska on business transactions and commercial litigation. He was the first attorney in Alaska to be elected to the prestigious American Law Institute.

Robert J. Dickson was selected as an Alaska Super Lawyer in the category of General Litigation. Mr. Dickson has practiced law for 35 years in the areas of construction litigation and healthcare law, including medical malpractice defense. He is also the co-author of Alaska Construction Law, author of the Alaska Chapter in Sourcebook on State Public Construction Law (CCH 2002), and numerous other publications on Alaska construction law. In addition to owners, contractors, subcontractors, suppliers, sureties, title companies, banks and hospitals, Mr. Dickson has represented national and international design and engineering firms on a variety of claims including engineering malpractice defense, as well as contract disputes.

Jerome H. Juday was selected as an Alaska Super Lawyer in the category of Business and Corporate law. Mr. Juday has been an Alaska bar member since 1982. He has served on the Alaska Bar Association’s Rules of Professional Conduct Committee since 1996, acting as Chair of that committee since 2002. Mr. Juday’s practice emphasizes real estate law, commercial transactions and business litigation.

W. Michael Moody and Richard E. Vollertsen were also selected as Alaska Super Lawyers in the Personal Injury practice area. www.alaskainjurylawblog.com/2008/01/alaska_personal_injury_law_gro_2.html

Mr. Gagnon, Mr. Dickson, Mr. Moody, and Mr. Vollertsen are also all AV rated by Martindale Hubbell, the highest national rating for legal ability and ethics, and have been listed in the Best Lawyers in America for over 10 years.

The rigorous merit-based selection process began early in the year, with invitations to participate in the nominations process going out to over 1,400 attorneys in Alaska. In addition, Law & Politics’ research department conducted independent candidate searches through professional databases, legal trade journals, and meetings with law firms. The candidates were then evaluated by the Law & Politics research department. This evaluation process included examination of candidates’ background and experience, followed by a peer evaluation from other Alaskan attorneys in the practice area. The final candidates selected were those with the highest point totals from each category, and included only five (5) percent of all attorneys in Alaska.

January 24, 2008

Atkinson, Conway and Gagnon Prevails In Ninth Circuit Ruling

While cargo barges may be "unmanned" while under tow, longshoremen and seamen often go aboard "unmanned" barges for loading, unloading and other purposes. Federal regulation 46 C.R.F. § 92.25-5 requires that cargo barges have a three-course perimeter safety railing. The Coast Guard, however, has failed to enforce that regulation, stating without explanation in its Marine Safety Manual that such barges are totally exempt from the railing requirement. In a lawsuit we are handling, a longshoreman working on a cargo barge equipped with only a two-course safety railing fell between the two courses (exactly where the third course should have been) and was crushed and badly injured when the barge surged back against the dock. In an important recent decision, the Ninth Circuit agreed with us that the Coast Guard's manual is inconsistent with the regulation; that the express terms of the regulation controls; and that the barge was in violation of the regulation. Abruska v. Northland Vessel Leasing Co., 2007 WL 4328834.