GT’s Rudolph Giuliani and Gary Epstein Opened Trade on TASE for the First Time

Posted in Event, Firm News, Israel, Stock Exchange

Tel Aviv Operating Shareholder Gary Epstein and Former Mayor of New York and Chair of Greenberg Traurig’s Cybersecurity, Privacy and Crisis Management Practice Rudolph Giuliani opened trade on Tel Aviv Stock Exchange (TASE) for the first time in late June.

The event, led by Ittai Ben Zeev, TASE CEO, attracted over 200 young entrepreneurs and members of the social organization “Tel Aviv International Salon,” with whom Mayor Giuliani met and spoke to following the ceremony.

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Left to right: Ittai Ben Zeev, TASE CEO; Rudolph W. Giuliani, Former New York City Mayor and Chair of Greenberg Traurig’s Cybersecurity, Privacy and Crisis Management Practice; Gary M. Epstein, Tel Aviv Managing shareholder, Co-Chair Israel practice, Senior Chair, Global Corporate & Securities Practice. Photo credit: Guy Assayag.

 

Greenberg Traurig Client Mitoconix Bio to Take Aim at Huntington’s Disease

Posted in Israel, Startups

Mitoconix Bio, an innovative Israeli startup bred by Israel’s only life science incubator, FutuRx, has recently raised $20 million to develop a promising drug for the treatment of Huntington’s disease and other neurodegenerative disorders, as reported by the Times of Israel.

Both Mitoconix Bio and FutuRx are clients of GT’s Barry Schindler, co-chair of Greenberg Traurig’s Global Patent Prosecution Group, and an active member of the firm’s Israel Practice. In addition, Elysa Goldberg and Sarah Fashena work closely with both clients.

Barry Schindler, co-chair of Greenberg Traurig’s Global Patent Prosecution Group

Ben Adler Joins Greenberg Traurig’s Corporate Practice

Posted in Attorney Spotlight

NEW YORK – July 5, 2017 – Global law firm Greenberg Traurig, LLP is pleased to announce that corporate lawyer Ben Adler has joined the firm’s Corporate Practice.

Adler spent nearly 18 years at Goldman Sachs, most recently serving as Managing Director and General Counsel of the firm’s Merchant Banking Division, where he helped manage the provision of legal services to the group’s multi-billion private equity business across the United States, Europe and Asia. Prior to Goldman Sachs, he was a Partner in the Corporate Department at Fried, Frank, Harris, Shriver & Jacobson LLP.

The primary focus of Adler’s client work is on corporate investments, M&A and private equity transactions. Adler travels extensively to financial centers where Greenberg Traurig maintains offices, and provides guidance and advice to clients on a worldwide basis. He serves business and portfolio companies on these transactional matters and also on corporate governance, financing, and regulatory issues. He also counsels investment committees, and has extensive experience in fund formation and related matters.

Read the full press release here

How Startups Can Avoid Costly IP Mistakes

Posted in Intellectual Property

Most startup entrepreneurs spend a significant amount of time creating business plans, product development plans, marketing plans, etc. However, startups often neglect one of the most important aspects of planning — developing a plan for the company’s intellectual property (IP) to minimize risks to the company’s intangible assets. This oversight can be a critical mistake that can doom the startup. To help avoid IP headaches down the road, here are some IP tips that every startup company should consider.

Don’t Confuse Which IP Is Necessary for Your Intangible Assets
Not all IP is the same. Different IP options offer different protections, so it is important to understand the distinctions. Generally, these are some key areas of IP to consider:

  • Patent protects the idea.
  • Copyright protects the expression of the idea and requires the memorialization of the idea on a tangible medium.
  • Trademark protects the logo or the name and acts as an identifier of the source of the product or services associated with the logo or name.
  • Trade Secret protects anything that is confidential or proprietary.

Incorrectly pursuing the wrong IP protection can be costly and can place your company at risk. More often than not, entrepreneurs are faced with having to decide whether a patent strategy should be implemented or if trade secret is sufficient.  The answer is – it depends.  Each offers different types of protection with distinct benefits and risks, so you will need to decide which path is right to meet your business goals. It is always best to seek the advice of an IP attorney in this respect.

Avoid Public Disclosure of IP
Inventors may inadvertently jeopardize their ability to successfully apply for or be granted a patent by disclosing information about the invention to the public. Three typical situations to make efforts to avoid are:

Research and Development (R&D) in the Open
With the proliferation of co-working spaces, many companies are conducting R&D in the open and making their prototype available for all to see.  This practice can be considered a public disclosure and will likely foreclose patent protection in most of the world.  The United States affords a grace period of one year to file for patent protection, but consider avoiding doing research in the open.

Publishing or Presenting your Innovation Too Early
Companies sometimes publish or present their research early to showcase their innovation, which is often the core technology around which the company is being built.  In other instances, to fundraise, companies may meet with investors who often refuse to sign a non-disclosure agreement (NDA).  In either instance, the one-year clock for protecting IP will have started ticking, while protection in most of the world will likely have been foreclosed. With this in mind, it is important for companies to file the innovation with the United States Patent and Trademark Office (USPTO) before doing any presentations.

Discussing Innovations You Plan to Pursue
Even after a patent application is filed, any presentation or discussion should be limited to the subject matter that is in the filed patent application.  Also, during an interactive presentation or discussion, be aware of unintended brainstorming sessions between yourself and the other party.  This type of discussion may result in an invented concept not previously in the patent application being discussed with or suggested by the other party.  In such a situation, the inventive concept is now publicly disclosed, and the other party is now a co-inventor in the new inventive concept.

Remember to Secure IP Ownership Up Front
To help ensure the company has complete ownership of all IP assets, as soon as the company is incorporated or formed, all relevant IP should be assigned to the company.

Assignment Agreement
Many companies don’t consider IP early on and do not have proper assignment agreements in place.  If a founder leaves the company, and there is no assignment agreement, that founder owns the IP outright and can take it to a competitor or start a competing company.  What can help avoid this situation is making sure that all innovations are assigned to the company as soon as the company is formed.

Employment Agreement
Similarly, companies should consider putting an assignment clause in the employment agreement stating that the company owns the IP generated during the course of employment. The assignment clause should include the magic phrase, “I hereby assign.” By having an employment agreement with such an assignment clause, should the employee leave before an assignment agreement is executed for an invention, the company can rely on the employment agreement to show proof of IP ownership.

Confidentiality Protocol
If trade secret is an IP strategy or if there is a robust culture of exchanging ideas in a company, having a confidentiality protocol in place can protect the company from inadvertent public disclosure. At a minimum, every startup company should consider including the following provisions:

  1. Making sure appropriate content is marked as confidential and educating employees on the risks of publicly disclosing the information;
  2. Having written agreements with employees and outside contractors that require them to maintain business confidences.
  3. Implementing policies that place limits on the extent to which employees may transfer sensitive material to personal devices (e.g., rules against sending material to a personal email address).

Steer Clear of Using Content and Resources from Previous Employer
As an entrepreneur, “borrowing” trade secrets, know-how, customer lists, etc., from a previous employer is strictly prohibited.  In most cases, you likely signed an employment agreement with your previous employer that prohibits you from using such information to compete. If there was a non-solicitation provision in the employee agreement, you also cannot hire any talent from the previous employer to your new company. Violating either of these provisions can place your company in jeopardy even before it starts.

Make Sure Domain Name and Trademark are Available
In an effort to avoid wasting time, effort, and marketing dollars in branding your product and/or venture, you can make sure that the domain name you want is available first before deciding on a trademark for your product or venture.  Without that domain name, having a trademark that your customers cannot easily associate with your product or venture can be a detriment to your business.

Likewise, performing a clearance study to ensure that your trademark is available before spending resources on a branding campaign can be helpful.  It would be unfortunate if you were to find out late in the process that a competitor has a same trademark for a similar product.  The costs associated with undoing and redoing a branding campaign can be significant.

Health Care & FDA Practice Bulletin No. 5

Posted in Health Care & FDA

Welcome to Greenberg Traurig’s Health Care & FDA Practice Bulletin, a collection of timely articles written by our attorneys that are focused on significant developments in health and FDA law. The topics in this issue include the Affordable Care Act, health care fraud and abuse, regulatory updates, FDA news, other health care topics, and upcoming events.

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JVs For Partial NYC Tower Stakes Pose Control, Tax Puzzles

Posted in Real Estate

The opportunity to acquire a 49 percent stake in New York commercial real estate is particularly suited to Israeli insurance companies and pension funds. Under Israeli regulations, these institutional investors are not permitted to acquire a majority interest in real estate that is  subject to a mortgage loan.  While U.S. real estate developers are often more attracted to investors who will fund 80 percent or more of the equity in an investment, the tax incentives in New York that motivate owners to sell a 49 percent stake in a transaction helps Israeli capital compete for investment opportunities.

For more information and background on this topic, please see the Law360 article, “JVs For Partial NYC Tower Stakes Pose Control, Tax Puzzles.”

 

Join us at the Upcoming MeetUp: Digital Health at Cleveland Clinic Innovations

Posted in Event

Greenberg Traurig is proud to sponsor the upcoming MeetUp Digital Health at Cleveland Clinic Innovations to take place May 21 from 4:30-6:30 p.m. at the Maccabi Healthcare Training Center 4 Yeיhezkel Koifman St., Tel Aviv-Yafo.

The MeetUp, focused on new company formation and biomedical technology commercialization at Cleveland Clinic, will feature Greenberg Traurig’s Bob Grossman, co-chair of the Israel Practice, and Barry Schindler, co-chair of the Global Patent Prosecution group, who will speak on trends and partnering in e-health.

The event is free of charge. Click here to RSVP.

Chapter 11 German Style

Posted in Bankruptcy, Mergers & Acquisitions

Historically, German insolvencies have been perceived as extremely unattractive, particularly because they were dominated by court-appointed bankruptcy administrators, with limited to no influence for creditors. This has, however, significantly changed over the last years. In that respect, it was the clearly expressed intention of the German legislature to make insolvencies more attractive for all parties involved. However, the available powerful features are often still unknown and hence not used, in particular by foreign investors. Outlined below are a few key features that may be utilized in German insolvencies.

  • Debtor-in-possession (DIP) proceedings: German insolvency law allows distressed companies to restructure themselves without losing control over their business and the restructuring process. It is no longer necessary that an insolvency administrator in the traditional German style takes over the operation of the business and exercises complete control at the expense of existing management and shareholders. Instead, the distressed company can remain in charge and operate its business, in almost all practical cases with the support of an insolvency professional as chief restructuring officer, who is trusted by the existing management. The court only appoints an insolvency professional to supervise the company (so-called Sachwalter, often translated as trustee). If planned in advance and well prepared, debtor-in-possession proceedings can allow for a complete restructuring process in less than eight months.
  • Insolvency plan: Another feature of German insolvency law is the so-called Insolvenzplan (often translated as insolvency plan). It is basically a proposal to the company’s creditors of how the restructured business should look and what actions need to be taken to implement the restructuring. Such proposal may even involve a total squeeze-out of existing shareholders. Only the company (or, seldomly, the trustee upon instruction of the creditors) can present such a plan. If the plan is approved by the creditors, the legal steps proposed therein take immediate effect without further documents or additional process. Creditors must approve in groups, which are set out in the plan presented by the company. There may be any number of groups, as long as creditors with a comparable economic interest are put in the same group and treated equally. The plan is approved if in each group the approving creditors have the majority in terms of headcount and volume of claims. The plan can be forced upon opposing groups, if a majority of the groups vote for the plan. The only test for a cram-down is that the opposing group must not be worse off with the plan than without, the latter normally being a liquidation scenario. A creditor cannot argue that it would be better off with a different plan.
  • Financing of restructuring measures: Unlike in Chapter 11 proceedings, German insolvencies do not use DIP financing because German financial institutions do not accept a reduction in the value of their collateral. Instead, German insolvencies take advantage of an element under the social security system by which employees are insured against the loss of their wages in an insolvency for up to three months. Under this concept, the payroll of the distressed company is paid for up to three months while operations continue and revenue is generated. The resulting claim of the social security agency is an unsecured claim in the insolvency, only receiving a dividend like any other unsecured creditor.
  • Reduction of headcount and other restructuring measures: In insolvency, labor law rules are considerably weakened making it easier for the distressed company to reduce its headcount. Long term contracts can be terminated and unprofitable leases can be returned, with any resulting claim for damages becoming an unsecured claim in the insolvency.

These instruments allow strategic investors to straighten out a venture that has proven to be more tricky than anticipated. They can be used by financial investors as an M&A tool for investments in companies that can be bought for a low price and then turned around. However, a key element for success is a coordinated and structured approach as early as possible in the process.

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