Executive summary. ixAbout the author. xiiiAcknowledgements. xvIntroduction. xixPART ONE: UNDERSTANDING WHY COMPANIES ARE ENSNAREDIN COSTLY LITIGATION. 1Chapter 1: The Five Cs of Business Litigation Risks. 3Creating a business litigation risk profile. 4The closely-related regulatory risk profile.
8Assessing commercial litigation risks - a five-part framework. 10PART TWO: CORPORATE GOVERNANCE LITIGATION RISKS- CLAIMS FROM SHAREHOLDERS AND OTHER CONSTITUENTSOF THE BUSINESS . 15Chapter 2: Basics of Corporate Governance Litigation . 17Understanding shareholder litigation - a useful metaphor . 18Four recurring themes of corporate governance litigation . 23Seven legal concepts useful to understanding corporate governancelitigation. 27Chapter 3: Ten Sources of Corporate Governance Lawsuits. 371.
Irreconcilable differences between ill-suited business partners. 372. Failing to maintain the formalities and other best practices . 39ContentsivContents3. Giving employees equity interests resulting in dual sets ofobligations. 414. Disputes over informational rights of shareholders, members andpartners . 425.
Misleading constituents through fraudulent statements oromissions . 446. Breach of fiduciary duty claims. 477. Failing to make reasonable inquiries concerning risks to thecompany. 528. Failing to implement a code of ethics and effective corporatecompliance program . 539.
Commingling and other separateness issues. 5510. Dealing with creditors and facing insolvency . 56PART THREE: LITIGATION RISKS FROM COMMERCIALCONTRACT DISPUTES. 61Chapter 4: Core Issues in Breach of Contract Litigation. 63The six issues raised in contract-based litigation claims. 70Conclusion. 89Chapter 5: Strategies for Managing Litigation Risks Arising fromCommercial Contracts.
931. Manage the contracting and approval process. 932. Formalize informal agreements . 953. Be aware of the risk of preliminary agreements and agreementsto agree. 964. Scrutinize the scope of express indemnity provisions.
975. Address termination scenarios and the risk of precipitousterminations . 986. Specify which contract terms survive termination. 997. Craft time limits and cure provisions that are appropriate. 1008. Consider how joint venture duties arise.
1019. Include an effective integration clause . 10210. Guard against claims that a contract was fraudulently induced . 10311. Prevent claims that a contract was modified by subsequentconduct and effectively modify written agreements. 104vAvoiding and Managing US Business Litigation Risks12. Preclude claims for extraordinary damages .
10613. Control where the battle will be fought and jurisdictionalwaivers. 10914. Ensure favorable law will be applied. 11015. Consider the pros and cons of arbitration . 11116. Decide whether an attorney fee provision is beneficial .
12017. Determine whether there are strategic benefits to waiving a jurytrial . 121Chapter 6: Lawsuits Arising from Negotiations and ImpliedObligations. 125Surprise contract formation . 128Liability for bad faith during contract negotiations . 132Misuse of confidential information obtained in negotiations . 137Coercive negotiations constituting economic duress. 139Practical ways to reduce the risks of claims arising from contractnegotiations .
140Avoiding claims for breach of the implied covenant of good faithand fair dealing. 145PART FOUR: CUSTOMER CLAIMS INCLUDING CONSUMERPROTECTION CLASS ACTIONS, PRODUCT LIABILITY, ANDBREACH OF WARRANTY CLAIMS. 151Chapter 7: Customers Presenting Consumer Protection and ClassAction Risks. 153US class actions - a tough pill to swallow. 155Overview of US class actions . 156The rise in pre-filing settlements . 164The California class action framework . 165The interrelationship between state consumer protection claims andfederal regulations.
171Chapter 8: A Framework for Identifying Consumer Class Action Risks. 1771. What is said about the product or service?. 1782. What is not said about the product or service? . 1863. What is said about the price, including fees and charges? . 1874.
What is said about competitors in the market?. 190 viContents5. What is said about the transaction?. 1926. How are the advertising statements conveyed?. 195Chapter 9: Three Additional Litigation Risks Specific to Product Salesand Distribution . 207Breach of warranty claims . 209Product liability claims.
220Prop 65 Claims. 227Chapter 10: Strategies for Mitigating Specific Customer LitigationRisks . 237Identify and prioritize the greatest customer litigation risks. 238Re-examine regulations that may buttress customer claims. 238Monitor regulatory activity.