Case Studies

Your company might never have to deal with the kinds of executive scandals and financial misdeeds that have put some major corporations in the spotlight in recent years. But if you have employees or customers, if you offer a service or product, whether tangible or intangible, if you have plans to move or expand or even downsize-in short, if you're in business-you'll probably need legal counsel at some point.

"Recognizing the costs and risks of business litigation leads to planning against having to become involved in the process," says Jeffrey D. Fridkin, co-founder of Grant, Fridkin, Pearson, Athan & Crown PA in Naples. "When circumstances make it necessary to pursue or defend business interests in court, businesses should look for specialists in the process who have earned the Florida Bar's designation of 'board certified in business litigation.'"

Intellectual property rights is one area that often trips up companies. "Businesses spend large sums to protect their hard assets, such as buildings and personal property, but they often do not focus on protecting their intellectual property, such as patents, copyrights, trademarks and trade secrets," says Jeanne L. Seewald, office managing shareholder with Fowler White Boggs Banker PA in Naples. "Protection of these assets is just as important and, at times, more important to the survival and growth of a business."

And since companies are typically employers, labor and employment law frequently entangles them.

"If businesses don't know some of the areas of labor and employment law, they risk litigation for all kinds of wrongful practices," says Jon D. Fishbane, a partner at Roetzel & Andress in Naples. "They need to be very careful about hiring practices, training practices, developing good policies, things of that nature. A good employer is going to not only want to have familiarity with the law but work with legal counsel and human resources personnel to keep themselves out of legal discipline."

We talked to four local attorneys who specialize in different areas of business law to find out what businesses should know about their rights and liabilities.

jon d. Fishbane

Labor and employment law and litigation, immigration law.

Firm: Roetzel & Andress, Naples

Years in practice: 18

The scenario: "The hiring of a commercial driver for a Naples company. In the process of the hiring, we undertook an extensive background check. During the process of his employment, there was an accident. [An alcohol and drug] test came back that he was impaired [at the time of the accident].

"He told us he actually had had a problem with alcohol, something that did not appear when we first did the background check. We obviously couldn't put him back on the road, but we did not want to violate any disability laws, as he was asking us for treatment.

"We decided to err on the side of caution, and the company had an employee assistance program. But we found he really was not being as consistent with his rehab program as he should.

"We then warned him that he was already suspended, pending the completion of the program, and that he risked termination if he did not immediately follow through with his program. He seemed to follow through for a while, then the same pattern reasserted itself. At that point, we made a decision to terminate him from his employment."

Lesson learned: "It's very important to undertake very efficient background checks. We felt we may even need to tighten up the interview process to get a sense of the behaviors of the individual. We also learned the importance of [developing effective prevention programs and] being in constant communication with counselors and therapists at employee assistance programs [to make sure an employee is following through]."

Tips for employers: "Make sure [to] monitor state and federal employment laws, especially in the areas of Title 7 law [including discrimination, sexual harassment, Americans with Disabilities Act and other issues]. And I-9 [the government form for employment eligibility verification] compliance has become a very important issue. Also, companies need to stay up on recent changes in the Fair Labor Standards Act and be careful how they categorize employees, so they're not stuck at the end of the day paying overtime and overtime fines because they thought someone was salaried when they should have been hourly."

Toughest loss: Fishbane represented a condo association in a case involving a disabled resident seeking to make extensive renovations. "The case went to trial and we thought we had won, and then the jury came back with a sizable verdict [for the plaintiff] that we were just stunned by. The judge reversed the ruling. You really can't predict a jury outcome, as much as you might believe you can."

jeanne l. seewald

General business and corporate transactions, mergers and

acquisitions, intellectual property and antitrust.

Firm: Fowler White Boggs Banker PA, Naples

Years in practice: 14

The scenario: "I work with clients to select and register trade names, trademarks, slogans and logos to represent their goods and services in the marketplace [and] on technology-related issues, including resolving domain-name disputes and drafting Web site agreements. [We] recently provided these services to a new Internet company, I-Go City Inc., to establish its Web site at www.i-gocity.com. The Web site provides information to travelers regarding cities throughout the country."

Biggest challenge: "Working with clients who come to me after having selected a trademark they want to use in the marketplace. If the name is unavailable due to use by another company, the client often has a difficult time understanding why it should change its mark."

Toughest loss: "My client was in a trademark dispute with a larger corporation. The client had a very good position, as it had used the trademark first. However, the client did not want to spend the money to fight what it considered a Goliath, so it settled the dispute by ceasing use of the mark. It was difficult because I knew my client had the winning legal argument."

Tips for businesses: "Consult a trademark lawyer early in the process of establishing and branding a new product or service. Too often a client begins using a trademark without obtaining legal advice and finds itself quickly involved in an expensive and lengthy trademark dispute."

jeffrey d. fridkin

Civil trial and business litigation.

Firm: Grant, Fridkin, Pearson, Athan & Crown, PA, Naples

Years in practice: 26

the scenario: "My client, Magnolia Pond Road Development, had a contract to purchase 44 acres of land near the intersection of S.R. 951 and I-75. The purchase price was $4.5 million. Magnolia had a right under the contract to pursue development permits for the property, with a deadline of six months. That deadline could be extended, but required Magnolia to demonstrate that it proceeded in good faith and was diligent. The seller was required not to unreasonably withhold consent to an extension, upon Magnolia making the required showing of good faith and diligence.

"Between the date of the contract and the deadline for obtaining the development permits, the land value more than doubled. Magnolia incurred costs of $400,000 pursuing the development permits, using a team of experts, but could not get the permits within the six-month deadline. The seller would not grant the extension unless Magnolia paid him an additional $500,000. Magnolia sued. After seven days of trial, judgment in favor of Magnolia was entered."

Lesson learned: "The client's biggest lesson: choosing partners carefully. There was much dispute and disagreement between the members of Magnolia. I learned that it is good to have good partners, because the manner in which my partner, Dick Grant, handled the transaction before litigation made a big difference in the successful outcome."

Biggest challenge: "Keeping the judge and/or jury focused upon what I see to be the critical issues and facts. My opponents are trying to do the opposite."

Toughest loss: "A client built docks around a lagoon in Vanderbilt, which was surrounded by condos. He had used Ohio lawyers to guide him in the acquisition of what he thought were rights to build, and then lease-sell the docks to the condo owners. The condo owners sued, contending that he lacked any interest in any lands to support his claim of ownership to the docks he built. They won, and the court refused to let him get his money back for the dock improvements. Nearly 20 years later, I still think the result was unjust. The lesson here is: never use out-of-state lawyers to guide a substantial investment in Florida property."

Tips for businesses: "Do not send e-mails and letters [that] say things you do not want to have to explain under oath some day."

guy e. whitesman

Tax planning, mergers, acquisitions, business planning

and estate planning.

Firm: Henderson, Franklin, Starnes & Holt PA, Fort Myers

Years in practice: 25

The scenario: "Several years ago,

we were looking at the division of a professional business [due to owner disagreements]. One of the shareholders had only been practicing with the group a couple of years, but the practice had been in existence for 10-plus years. The Internal Revenue Code allowed for the tax-free division of a corporation among its shareholders if it met certain tests, which included an active trade or business requirement of five years or more. The question was whether the professional practice would be reviewed as one integrated business or as two separate practices where one had only been conducted for a couple of years. We successfully applied for a private-letter ruling [from the IRS, which provided guidance] on an issue that never had been ruled on before. An adverse ruling would have meant thousands in additional taxes. While it might not seem too thrilling, it was good to know that we were creating new tax law down here in Fort Myers."