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Ryan C. Hardy

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rhardy@spencerfane.com

Supreme Court Adopts Restrictive Minority View of Section 546(e) Safe Harbor Regarding Certain Securities Payments

On February 27, 2018, a unanimous Supreme Court held in Merit Management Group, LP v. FTI Consulting, Inc. (link here) that an otherwise-avoidable transfer is not subject to the safe harbor in Section 546(e) (which provides, in relevant part, a trustee may not avoid a transfer that is a “settlement payment . . . made by or to (or for the benefit of) a . . . financial institution” or that “is a transfer made by or to (or for the benefit of) a . . . financial institution . . . in connection with a securities contract”) of the Bankruptcy Code merely because funds flow through covered financial entities.  Rather, the availability of the Section 546(e) safe harbor depends on the particular transfer sought to be avoided.

Governor Greitens Orders Review of Every Missouri Regulation

On January 10, 2017, Missouri Governor Eric Greitens signed Executive Order 17-03 (the “Order”). Among other things, the Order compels all state agencies to review each and every Missouri regulation appearing in the Code of State Regulations that falls within their jurisdiction.

Manufacturer’s Corner: A Word on Warranties of Future Performance

Courts sometimes have trouble determining whether a warranty explicitly extends to future performance.  A recent case provides refreshing clarity on the issue.

Manufacturer’s Corner: Climate Change and Consumer Protection Statutes

A new theory of securities fraud may prove important (and dangerous) to manufacturers.

Manufacturer’s Corner: Highlighting Some Important Distinctions Between UCC Article 2 and CISG

If you’re like many manufacturers who sell internationally, your standard terms and conditions provide that the UN Convention on Contracts for the International Sale of Goods (“CISG”) does not apply to your transaction.  But, maybe they don’t, or maybe your disclaimer is ineffective (it happens a lot).  In those instances, it’s important to understand where CISG differs from Article 2 of the Uniform Commercial Code, which typically covers sales of goods within the United States.

Manufacturer’s Corner: Delivery Terms Have Important Tax Implications for Missouri Manufacturers

Today’s column is prompted by a recent decision by the Supreme Court of Missouri, in which the Court denied a Missouri manufacturer a sales tax refund.

Manufacturer’s Corner: Conflict Mineral Reporting Requirement Still Illegal

On August 18, 2015, the D.C. Circuit Court of Appeals, sitting en banc, upheld its prior order striking a portion of the SEC’s conflict mineral rule.

Manufacturer’s Corner: The Danger of Conditioning Your Sale on the Buyer’s Acceptance of Your Terms

If you review the terms and conditions given by many manufacturers in their invoices (including, probably, yours), you likely will find a provision that says something to the effect of “we agree to sell you this product if, and only if, you agree to each of these terms and conditions.”  It’s a common term, and there’s a good reason for it: it can counteract standard form language in the buyer’s purchase order that you don’t like.

Manufacturer’s Corner: Breach of Warranty Claims and CGL Coverage

A court recently held that a CGL insurer owed a duty to defend its insured accused of breaching express and implied warranties.

Manufacturer’s Corner: Manufacturer Gets Second Chance Following Unsuccessful Litigation With Supplier

This is a story about a U.S. manufacturer who got into a dispute with its Chinese supplier. 

Manufacturer’s Corner: FTC Announces Nothing

In 2011, the FTC requested public comment regarding its interpretations, rules, and guides issued under the Magnuson-Moss Warranty Act.  After four years of hard work, the FTC today issued a press release headlined “FTC Will Keep Consumer Product Warranty Rules in Current Form with Some Modifications.”

Manufacturer’s Corner: Eighth Circuit Offers Expansive View of Economic Loss Doctrine

If you regularly read this column, you know that one of the things we spend a lot of time discussing is working appropriate protections into your contracts.  Plaintiffs’ attorneys understand that, and often try to work around those protections by restyling breach of contract or breach of warranty actions as tort claims – that is, claims for negligence or fraud or the like.

Manufacturer’s Corner: Warranties of Future Performance

File this one under “does your warranty really say what you think it says?”

Manufacturer’s Corner: The “Ambush Election” Rule Is In Effect

Beware union organizers loitering around your premises!

Manufacturer’s Corner: Warranty Disclaimers By Intermediate Sellers

If you’re like many manufacturers, you have no dealings with the end user of your product.  Rather, you sell to a distributor or other intermediate seller, who then sells your product to the end user.  We have previously discussed disclaiming your implied warranties against your intermediate buyer and whether that disclaimer travels “downstream” to the end user, but we haven’t addressed whether a disclaimer made by the intermediary can protect you in a suit by the end user if, say, you failed to disclaim your implied warranties yourself or if for some reason they are not effective against the end user.

Manufacturer’s Corner: The Interplay Between Limited Remedies and Damages Limitations

I previously have urged you to limit the remedies available under your express warranty (e.g. to repair or replacement), and to disclaim liability for incidental and consequential damages.  Here, we’ll discuss a common argument made by people who want to render your efforts meaningless.

Manufacturer’s Corner: Just What Is the “Ordinary Use” for a Product Anyway?

For this installment, we turn to an aspect of the implied warranty of merchantability that has not gotten its fair share of attention here: what is “the ordinary purpose” for which your product is used?  It seems like a simple question, but it can be deceptively tricky.

Manufacturer’s Corner: Merchants, Battles of the Forms, and Forum-Selection Clauses

If you read this column with any regularity, it will not surprise you that I was thrilled to read this introduction to a recent court opinion: “The motions to dismiss in this case present a difficult legal issue, as if a civil procedure professor and a Uniform Commercial Code professor conspired on a law school exam question[.]”

Manufacturer’s Corner: The West Coast Port Labor Dispute and You

Manufacturer’s Corner. So, there’s a big shipping backlog forming out west while port owners and the longshoremen work a few things out.  How’s that affecting your supply contracts?

Manufacturer’s Corner: Disclaiming Implied Warranties to Remote Purchasers

As I’ve noted before in these columns, an implied warranty disclaimer is an essential part of your terms and conditions.  But giving an effective disclaimer is sometimes easier said than done, especially when you do not sell your product directly to the end user, but rather through a wholesaler, retailer, or other intermediary.

Manufacturer’s Corner: President Proposes New Federal Data Breach Notification Law

Shortly before issuing his State of the Union address, President Obama released a proposed federal law mandating notification to individuals whose personal information is compromised in certain data breaches.  Not long ago, I wouldn’t have written about this issue in a Manufacturer’s Corner column, but since I recently decided that the Internet of Things will expose manufacturers to litigation over data privacy, it seems appropriate.

Manufacturer’s Corner: New Law Exempts Non-Financial End Users From Margin Requirements For Uncleared Swaps

Here is good news for a certain subset of Manufacturer’s Corner readers.

Manufacturer’s Corner: A Word on Consumer Class Actions

This is not a litigation column, but I’m a trial attorney, so litigation is always on my mind.  I’ve been hearing a lot of chatter lately about consumer class actions.  Specifically: what must a putative consumer class do to show that the class members are ascertainable – that is, that the court and the lawyers and the class members can figure out who is in the class and who is not.

Manufacturer’s Corner: Don’t Fall For Your Own “No Oral Modification” Clause

Here’s a thing that probably appears in your standard terms and conditions: “This agreement cannot be modified or rescinded, except in writing signed by an authorized agent of [your company].”  You can go ahead and check.  It’s probably down toward the bottom, above the miscellaneous provisions like choice of law.

Manufacturer’s Corner: The Importance of Notice Provisions

An easily-overlooked portion of a contract for the sale of goods is the one that addresses what notice the buyer must give the seller in the event the goods do not conform to contract specifications or warranties.  These provisions warrant your close attention, however, because they can be outcome-determinative in the event of litigation over the alleged non-conformity.

Manufacturer’s Corner: Missouri Supreme Court Limits Scope of Manufacturers’ Sales and Use Tax Exemption

Here is a troubling new case from the Missouri Supreme Court.  And I don’t mean troubling in the abstract sense of “oh maybe there could be liability down the road if you don’t do this,” which is pretty much the bread and butter of this column.  I mean troubling in the “you may have already botched this, so you better pull out the books and call the accountants and lawyers” sense.

Manufacturer’s Corner: Incorporating Software Into Your Products (Part 3)

Now that we have completed our brief detour into what the Supreme Court could maybe do with the BP oil spill case if it decides to do anything with it, we resume our ongoing series on what law applies when you incorporate software into your products.

Manufacturer’s Corner: Supreme Court Considering Case With Important Implications for Manufacturers

We take a break from our series on incorporating software into your products to talk about a case the Supreme Court is considering that may prove significant to manufacturers.  This column is not typically the place to go for predictions on what the Supreme Court may do, but I want to bring this case to your attention, and circumstances are forcing me to do it now rather than later.

Manufacturer’s Corner: Incorporating Software Into Your Products (Part 2)

In the first installment of this series, we discussed the general scope of Article 2 of the Uniform Commercial Code, and, in the broadest terms, whether and when the purchase or sale of software falls within that scope.  In this installment, we’ll move toward our goal of understanding when your purchase or sale of software is governed by Article 2 by looking at how the question has been treated by various courts over time.

Manufacturer’s Corner: Incorporating Software Into Your Products (Part 1)

This column spends a lot of time talking about Article 2 of the Uniform Commercial Code.  A lot of time.  That’s because it’s a column directed to manufacturers, and Article 2, generally speaking, deals with sales of goods.But that “generally speaking” glosses over quite a bit, and it can cause us to miss important issues.

Manufacturer’s Corner: Apple Revisited

Remember when I wrote a glowing column about a Master Development and Supply Agreement Apple and its lawyers drafted?  It was one of the most-read posts I’ve written, so I bet a good number of you do.  Since the post was so popular, and since there have been some, well, we’ll say “unanticipated consequences” for Apple, I thought it warranted some follow up.

Manufacturer’s Corner: Obligatory Post on the Internet of Things

There’s an unwritten rule that if you blog about manufacturing, you must blog about the Internet of Things.  I blog about manufacturing, so here we are.

Manufacturer’s Corner: Apple’s Master Course on Master Supply Agreements

This post comes to you based on a story by the always-excellent Matt Levine of BloombergView. Evidently Apple loaned a company called GT Advanced Technologies a bunch of money so GTAT could develop and supply Apple with sapphire screens for a long time. Anyway, there may have been a default under part of that agreement, and GTAT filed for bankruptcy protection because that default was going to ruin everything (at least according to industry speculation).

Manufacturer’s Corner: A Brief Return to Our Discussion of Statutes of Limitations

A thing I like to do is approach people at parties and other gatherings and ask them if they know they can use contracts to shorten some statutes of limitations.  Usually I get quizzical looks, but I guess the context just worked better when I mentioned it while speaking at a recent event put on by the Kansas Bar Association.  An especially attentive participant asked a good follow-up question that warrants some discussion: can you shorten the limitations period for fraud?

Manufacturer’s Corner: Anatomy of a Limited Warranty (Part 5)

In the first four installments of this series, we covered the essential components of an effective limited warranty.  But each of those installments carried an important caveat: that you were not selling consumer goods.  In this fifth and final installment of the series, we turn our attention to additional warranty issues to consider when selling consumer goods.

Manufacturer’s Corner: Anatomy of a Limited Warranty (Part 4)

We pick up our discussion of effective limited warranties by addressing limitations of remedies.

Manufacturer’s Corner: Anatomy of a Limited Warranty (Part 3)

In our last installment in this series, we looked at the express warranty portion of an effective limited warranty.  We now turn our attention to the importance of shortening the limitations period for bringing a warranty claim.  Please remember that, for our purposes here, we’re assuming a non-consumer sale.

Manufacturing Custom-made Goods in the United States

Pat and I recently had the opportunity to publish an article with Practical Law, called “Manufacturing Custom-made Goods in the United States.”

Manufacturer’s Corner: Anatomy of a Limited Warranty (Part 2)

In our last installment, I introduced the importance of making your warranty terms clear.  Now, we turn to the specifics, beginning with the express warranty itself.  Here are some of the boxes you need to check when reviewing your express warranty.

Manufacturer’s Corner: Anatomy of a Limited Warranty (Part 1)

It’s a sad fact of life at companies and law firms that sometimes things are done a certain way just because that’s how they’ve always been done. Part of the reason this column spends so much time talking about your terms and conditions, however, is because that’s dangerous: how you do things now should be informed by the past, but not bound by the past.

Manufacturer’s Corner: Revocation of Acceptance and the Statute of Frauds

I’m going to break my self-imposed rule of writing for manufacturers instead of lawyers. This post is some pretty in-the-weeds stuff, but the topic has been on my mind and I think it’s interesting. If you have opinions on it, I’d love to hear them.

Manufacturer’s Corner: Dealing With Sales on Approval or Return

Expanding on our recent discussion about how your shipping terms can affect risk of loss in the product you sell, let’s turn to other contract provisions that implicate the same issue: sales on approval or return.

Manufacturer’s Corner: Responding to Claims That Your Goods Do Not Conform to Contract Specifications

It’s inevitable: at some point, you will ship goods to your buyer, and the buyer will complain that they don’t conform to the contract specifications.  When you’re dealing with a small shipment or a great customer, often the simplest solution is to accept the return and send replacement goods.  Other times, however, you’ll be dealing with a major shipment or a problem customer, and you must be certain that you protect yourself while responding to the customer’s concerns.

Manufacturer’s Corner: When Bankruptcy and Your Shipping Terms Collide

In recent installments of the Manufacturer’s Corner, we have discussed how to protect yourself from insolvent customers and how your shipping terms can expose you to unexpected risk. Thanks to the Bankruptcy Court for the Eastern District of Pennsylvania, we can explore how those two issues play together.

Manufacturer’s Corner: Recent Development in Implied Warranties (Part 2)

We continue our discussion of June’s interesting implied warranty cases with a trip south to the Supreme Court of Texas.  As I mentioned in the previous installment of the Manufacturer’s Corner, the Court declared a simple, bright-line rule on how a valid disclaimer of the implied warranty of merchantability affects remote purchasers.

Manufacturer’s Corner: Recent Developments in Implied Warranties

In this head-scratcher of an opinion, the Michigan Court of Appeals makes three legal conclusions that will shock practitioners.

Manufacturer’s Corner: Protecting Against the “Efficient Breach”

The Oregon Supreme Court has given us a great platform to discuss what happens when a buyer simply decides that breaching the contract is a better idea than performing.  It’s an important case to consider, both in your capacity as a seller of goods, and in your capacity as a frequent buyer of goods under long-term sales contracts.

Manufacturer’s Corner: Can You Prove the Contents of Your Shipment?

In a happy coincidence of timing, the Eleventh Circuit Court of Appeals recently issued an entertaining opinion addressing the Carmack Amendment, which is a federal law limiting the liability of motor carriers for loss or damage of goods during shipment. The opinion will allow us to continue our discussion of mitigating shipping risks, introduced in the last installment of this column.