Corporate documentation

It’s July 1, let’s celebrate 147 years of our Country by bringing the commercial use of email to a screeching halt.

I’m not going to repeat what you need to do to comply with the Canadian Anti-Spam Legislation here. Scroll down our Blog and read the CASL Blog for that information.

What I will tell you is that I think this legislation is overkill.

I think this legislation is too expensive for Small Business to comply with.

I think that making Officer & Directors personally liable for email violations is wrong.

If you agree, please write your MP and let them know.

In the mean time, it’s July 1, 2014. Save those unsolicited emails you receive, they are worth $ 200/email come July 1, 2017.

This past week I spoke to The Canadian Tennis Professionals Association and the Professional Tennis Registry at the Rogers Cup in Toronto about Social Media and the Law. Part of that conversation involved encouraging each club to decide what their specific expectations were for their employees and then using those expectations to craft a policy for the use of Social Media.

What does your business expect from its employees? What does it expect from its’ executives?

If you don’t want, for example, your CEO, to stumble down a main street in Toronto while intoxicated, posing for photo opportunities, you may want to spell that out in their Employment Contract. If you think back to the two Blackberry Executives who were let go after being drunk & disorderly on a plane a year or so ago, you’ll see that it is possible for a lawyer to craft clauses in contracts that require good behaviour when representing your business.

The problem that businesses frequently encounter with expectations surrounding behaviour is their failure to specify what is expected in writing. If you don’t set out what behaviour you expect, you will have a hard time convincing a Judge that the employee knew the behaviour was bad and that you should be allowed to fire them for cause for not adhering to your good behaviour standards.

Expectations are not just limited to employer/employee relationships. If you do business with a customer on a “handshake” and you don’t meet what the customer’s expectations were, you have little evidence to present to a Court that you should still be paid for the service/good you provided.

All businesses have expectations. There is nothing wrong with putting those expectations in writing. You will not lose a customer worth having by requiring they sign an agreement detailing what you will provide and what they will receive.

When it is in writing there are no blurred lines regarding business expectations. If you want to enforce your expectations, Judges want it in writing, so let’s give them what they want.

Inga B. Andriessen JD
iandriessen@andriessen.ca

Mike Duffy, Nigel Wright, Rob Ford – all men whose reputations have been taking a hit over the past week. Each of these individuals is choosing a different way to protect their reputation, but leaving aside personal reputations, what about your business reputation?

The issue of defamatory remarks by anonymous posters has become a business issue many have had to tackle – when hit with these remarks it is important to evaluate their impact and what, if anything, you intend to do about it.

If someone posts something defamatory about your business in an obscure blog that receives no traffic and does not appear in search results, then pursuing the poster will attract more attention to the false comments than leaving them alone. Before proceeding “on principal” ask yourself if the legal fees will exceed the monetary impact the posting has on your business. If the answer is yes, then you need to consider if you must proceed in any event to prevent yourself from being targeted by others or if it is better to simply let the blog comments die an slow, unviewed death.

Your business reputation extends beyond bad reviews on Yelp or in Blogs, it also extends into your credit relationships with customers. I recall vividly a young dentist we assisted many years ago. The dentist set up practice in a neighborhood and quickly found that many of the cheques for post-dated payments were being returned NSF. The dentist was getting a reputation for doing work without taking immediate payment and many were taking advantage of this. Ultimately, the dentist chose to sue on several accounts and “surprisingly” the dentist was no longer the victim of people seeking services with payment over time. The dentist has gone on to have a thriving practice, dispelling the concerns of many business owners that if they sue on for money that is owed, they will lose customers.

As lawyers we are always taught, you have one reputation, you don’t want to ruin it.

Are you protecting your business reputation from ruin?

Inga B. Andriessen JD
iandressen@andriessen.ca

I snagged the title to this Blog from a Huffington Post Blog by Krizia. The original blog described the evolution of a small business called Lotus Premium Denim. This Blog is not about Denim.

The title of the Blog grabbed my attention because it refers to two things many lawyers fail to do, but two things I know that we do at our firm.

The title of the Blog grabbed my attention because it refers to two things many lawyers fail to do, but two things I know that we do at our firm.

Delivering on our promise is critical in maintaining the client relationships we have established over the past 20 years. I’m proud to say that many of the clients we have today are clients we have had for the entire 20 years the firm has been around.

The keys to “promising” as a lawyer in my opinion are:

1. Communicating clearly to the client what you will be charging them.
As lawyers all we have to sell is our time, but how we sell it (by the hour or by the task) is an important difference and clients must be told about this up front.

2. Honestly evaluating any litigation and being clear, even if you have a strong case, there is always a possibility of a Judge finding against you.
Clients have to be told Judges are human and let’s face it, there is a reason we have Courts of Appeal.

3. Before starting any litigation, assess the likelihood of collecting on a Judgment and advising the client if the only result will be a “pretty piece of paper stamped Judgment”.
No one just wants a pretty piece of paper and why should the law firm be the only party that benefits from litigation?

If you are our client, we understand you and we promise to continue delivering excellent legal services to you.

Inga B. Andriessen JD
iandriessen@andriessen.ca

As practicing lawyers and business people, we’re not supposed to weigh in on contentious issues; so this week I’m not going to talk about the Middle East, Mayor Ford, plastic shopping bag bans, the Argos or the Nicki Minaj and Steven Tyler twitter feud. Except that I sort of am.

Part of the Lunch and Learn we held yesterday at the firm dealt with social media in the workplace. It’s an interesting topic from a legal standpoint and one that generated a lot of conversation from clients. One area of confusion however, is the balancing of rights between freedom of expression and the privacy and reputation rights of the employer. How much restraint is reasonable and what kind of social media policy infringes on an employee’s right to free speech?

There are a lot of complexities at play. If the employer has a social media account (like ours) it’s completely reasonable for an employer not to allow an employee (like me) to use the corporate account to vent about their political beliefs or to make insensitive comments about a protected group. That reasonable limit may even extend to the employee’s personal account, depending on the extent to which they represent the company as a “public face.” The Israeli Defense Force is dealing with a bit of a PR disaster this week as pictures of their social media guru wearing blackface and calling himself Obama are being circulated on Facebook. Add that to last week’s circulation of pictures of active duty personnel posing for smiley faces on Instagram while they prepared for a possible ground campaign in the West Bank and you have an organization that probably needs to clarify its social media policy.

Inga’s advice yesterday was helpful I think, and cut through a lot of the competing rights confusion – the policy has to be reasonable and it has to deal with actual harm. If the way someone uses their social media platform of choice isn’t harming the employer in a real way, then the policy shouldn’t be otherwise restricting their behaviour. But where there is the possibility of defamation, leaking confidential information, or devaluing the employer’s brand, a good policy can be the most effective mitigation strategy around.

Scott R. Young.

While there are undoubtedly any number of juicy moral indiscretions to be observed in the Petraeus scandal that has been unfolding over the past few weeks, for me, the informational security issues are the most salacious.

It hasn’t been explicitly detailed, but it appears that the CIA chief’s dalliances came to light when the FBI ran a standard background check on his biographer. That background check turned up inappropriate e-mail correspondence in the drafts folder of a Gmail account that the biographer shared with Petraeus.

That means that without a warrant, and without any hint of a criminal activity, a government agency was able to freely examine the contents of the encrypted online e-mail account of the world’s foremost intelligence official.

Could there be any more stark an example of how weak informational security really is in the world today?

And it’s not just the mighty FBI that seems to reach out and grab whatever pieces of secure information it desires – the Israel/Palestine battles this week were met with another campaign by the hacking group Anonymous, where the group was somehow able to defeat various Israeli secure databases and post the contents online for all to see.

As a law firm, virtually everything that we do is private. All of our communications are privileged and the information that clients impart to us is often the most secret and valuable thing they can imagine. The very idea that this information is vulnerable is chilling.

For that reason, we take a number of steps to ensure that the information is as safe as is reasonably possible. We’re certainly not invulnerable, and we don’t have the resources of the CIA or the FBI, but we do take information security very seriouly. We use encryption, rotating password protection, secure physical plant protocols and whenever possible, 2 (or more) step authentication procedures. We try very hard.

But that’s not enough. Sometimes we actually have to forego technology altogether and go pick up a document. Or have a conversation in person. In private. Sometimes we have to advise clients that (where legal, ethical and appropriate) something shouldn’t have a permanent record.

As a client, who is expert in these matters, recently ranted to me – Balance is important. It is about being logical about competing priorities. If a piece of information is the most important thing in the world, we’re not going to e-mail it. We’re not going to leave it in a folder on our front desk waiting for someone to pick it up. It’s going to be treated very special. We’re going to devote significant time and attention to that piece of information. But we’re not going to give that same level of attention to something much more trivial. It just doesn’t make sense.

The world keeps changing and the pace of technological innovation isn’t going to slow down. But the more things change, the more they stay the same. The way we conduct our business and the advice we give to our clients will always have a strong foundation in common sense and logic.

Scott R. Young

There’s an interesting article in Huh Magazine about the costs of a few widely-known logos.

Seeing the low price paid for some of the more iconic ones is a good reminder of how much value can be put into branding at the early stages of a business’ development by being creative, or by tapping into some professional creative talent.

We’ve talked about the value of branding before, but we’ve mostly discussed the trade-name or other word phrases used in conjunction with the business. Graphic logos are an increasingly important aspect of branding – in some industries, the graphic logo is a far more recognizable aspect of brand identity than the company name or any slogan.

Proceeding through the trade-mark registration process with a graphic logo can be difficult, but, as always, if you have any questions about it, please give us a call.

Scott R. Young

An interesting decision was released last week by the Superior Court of New Jersey, a US state-level appeal court. According to the facts of the case, the defendant had accessed a co-worker’s Yahoo e-mail account from a computer lab terminal, which the plaintiff had inadvertently failed to log out of. The snooping defendant noticed an e-mail thread mentioning them, printed out the e-mail, and confronted the plaintiff with it. Obviously shocked by the invasion of privacy, the plaintiff immediately filed the suit, relying on the provisions of a state wiretapping statute – which apparently allows for both civil and criminal remedies.

It appears that historically, the test under this New Jersey law has been premised on the expectation of privacy held by the person whose communication was “intercepted”. That’s similar to the case law on the issue in Canada. However in the present case, the court was asked to decide whether the defendant knowingly accessed the account without authorization, and if not, what the extent of that authorization was.

Because the plaintiff had accessed their own inbox, and had left the index screen of the inbox up on the terminal when they left, the court found that the defendant did not infringe the law prohibiting access without authorization. The only question left to the court (in this case, a jury) was whether the defendant had exceeded the authorization provided by the plaintiff’s failure to log off. The jury found that the defendant did not exceed the plaintiff’s “tacit authorization” to access the account. On appeal last week, the court upheld the trial court’s decision – the snooping defendant was vindicated.

In Canada, the facts lend themselves not to a civil trial, but to criminal proceedings under the Interception of Communications provision of the Criminal Code. However the statutes are otherwise not all that different and much of the key phraseology is similar enough to think that the New Jersey case law might be relevant.

I don’t agree with the specific questions put to the jury, and the departure from the pure expectation of privacy test is unusual, but it would certainly be interesting to see how a Canadian case on similar facts would be interpreted.

Until we have such caselaw, the takeaway from all this is to protect your data and your communications as much as possible – any failure to do so, even accidentally, could be viewed as tacit authorization to snoopers and other evildoers.

Scott R. Young

Every once in a while we are lucky enough to get to work on the holy grail of a client’s operations – the policies and procedures manual. Sometimes it’s after our business compliance audit turns up some unexpected sources of liability, sometimes it’s after some triggering event has highlighted the need to put things on paper, and sometimes it’s a proactive first step in putting together a company right from the ground up.

The P&P manual is a great place to tie employees into the workplace by giving them a comprehensive document that outlines all of the rights and responsibilities associated with their job. It includes government mandated policies that address privacy, harassment, violence, accessibility standards and many more. It also sets out the specifics of the discipline policy so there are no ambiguities (and far fewer lawsuits) in the event of discipline or termination.

I probably get a lot more excited about putting these together than Inga or Paul or Murray do – but they often have a lot of input into them. Either they have knowledge of the client’s operations that help customize a policy that works in their workplace, or they have court experience on a particular issue that goes directly into how the policies and procedures are written.

If you are putting together a business from the ground up or are ready for a spring cleaning to make sure that your workplace is compliant from the top to the bottom, please have competent legal counsel draft some policies that work for your business, or review your current policies to ensure that they reflect the hundreds of legislative changes that have occurred in the last decade.

Scott R. Young

Amidst all the Facebook IPO hype this week, there was the release of an e-mail from Mark Zuckerberg to his corporate lawyer, instructing them to dilute Facebook co-founder Eduardo Saverin’s share in the burgeoning company.

Aside from the obvious professional responsibility issue that this presents for the lawyer (assuming the lawyer was acting for the corporation, they had an immediate duty to declare a conflict of interest and cease all representation of the company), the story highlights the need to get good independent legal advice before entering into any legal agreement. I had a great example of the right way to do things last week – we were retained to give ILA to a shareholder on a Shareholder’s Agreement that they had largely formulated. Despite the fact that this shareholder had been the principal instructor to the corporation’s lawyer, and was intimately familiar with most of the terms of the agreement, the corporation’s lawyer still thought it would benefit all of the shareholders to get ILA – not just to waive it as is sometimes (unfortunately) done.

The shareholder was convinced that ILA would add value even if only to have a fresh set of eyes review the agreement. In our review, we offered more than that; considering various critical events from the shareholder’s individual perspective was very different than the perspective of corporate representative they had while preparing the agreement.

The details of the Facebook dilution are not entirely clear (the ensuing litigation was settled and not much is on the public record) but presumably the restructuring that diluted Savarin down to 10% was ultimately effected, and presumably without Savarin retaining counsel to explain this to him. And when he did realize the dilution, litigation was the only option available.

Getting independent legal advice is not cheap, but the value in what you are getting is often immeasurable. If you are entering into an agreement of any significance (including potential future liabilities), you absolutely must have legal counsel review the agreement and confirm that your interests are protected (or that your unprotected interests are known to you). It’s that simple.

Scott R. Young