A Lithuanian man's simple, yet successful scheme to bilk $99 million from Facebook and $23 million from Google serves as a cautionary tale for companies who don't make signed copies of their contracts and the key terms accessible to their Accounting team. Evaldas Rimasauskas submitted loads of fake invoices, accompanied by other fake documentation, to Facebook and Google and reaped over $100 million in payments in exchange. Had the accounting team been able to find the relevant contracts in their own database and compare the business details of the invoices against the contracts, this could have been easily prevented. See the Reuters story here and read the indictment here.
The Contract Wrangler team was honored to host Colin Rule, one of the founding fathers of modern legal tech last week at our Contracts and Crepe Happy Hour. First Colin wrote the book (which you can order here) on Online Dispute Resolution and then put it into practice at eBay, PayPal, and his own startup Modria Technologies, which was acquired by Tyler Technologies and rolled out to governments around the world. Colin spoke with us about Smart Contracts, creating a sustainable startup in a new field, and resolving corporate disputes.
Neil was delighted to be invited to speak last week to the Enterprise 2.0 Team at Plug and Play Tech Center in Sunnyvale about one of his favorite topics: Best Practices for partnerships between enterprise SaaS startups and large companies.
Our Founder Neil Peretz was recently features in the Association of Corporate Counsel (ACC) Docket discussing how lessons from the Mari Kondo tidying frenzy can help companies deal with the largest tidying challenge: their ever-growing mass of corporate contracts. See the article here.
The ACC is the largest organization of in-house attorneys in the world, with over 45,000 corporate counselors and 10,000 organizations represented across 85 countries.
A recent column by Matt Levine from Bloomberg details a costly saga of a multi-billion dollar merger blown apart by the failure to remember a Notice Date in a contract. See the story here, complete with a sidebar about the court's footnote discussion of euphemisms for the word "prejudiced."
Its opinion (located here), court noted that after two days of trial, involving eight live witnesses and over seven hundred exhibits and eighteen preceding depositions, we learned (once again) that corporation who know what's in their contracts achieve far better results. Here, "as the minutes ticked down to the passing of the End Date, Rent-A-Center’s principals watched Vintage closely. Rent-A-Center personnel acted entirely in the corporate interest, anticipating the stroke of midnight, when Rent-A-Center’s termination right would ripen and could be exercised." Meanwhile, "there was no gamesmanship in Vintage’s actions—it simply forgot to exercise its contractual right. "
The result: a billion dollar merger broken apart and a termination fee in excess of $100 million that may need to be paid. According to the court: "Adjectives are often misplaced in legal opinions; nonetheless, I am comfortable describing the size of the reverse breakup fee, in light of the entity to be acquired, as enormous."
It's great to have a regulatory expert (Neil Peretz) as one of our founders at Contract Wrangler. The Association of Corporate Counsel recently asked Neil to author a series of articles about how to set up and run a Compliance Team when you work at a regulated company. Meeting Compliance requirements is one of the key reasons we created Contract Wrangler. Contracts are the vehicle for companies to make legal and regulatory disclosures to their clients and communicate shared compliance responsibilities to partners and vendors. Not surprisingly, we have a rapidly growing roster of highly regulated companies, such as large financial services providers, relying on Contract Wrangler to stay on top of this.
You can find the full article here.