Cox Padmore Skolnik & Shakarchy LLP FindLaw IM Template 2026-10-19T14:41:49Z https://www.cpsslaw.com/feed/atom/ WordPress /wp-content/uploads/sites/1402487/2022/02/cropped-site-identity-32x32.png On Behalf of Cox Padmore Skolnik & Shakarchy LLP <![CDATA[What is naked licensing in intellectual property law?]]> https://www.cpsslaw.com/?p=51922 2026-10-14T00:37:30Z 2026-10-14T00:37:30Z Licensing your company's trademark to another business can be a smart move. It can generate additional revenue, expand your brand's reach and introduce your products or services to new markets. However, there's a potential danger in giving another company permission to use your trademark without maintaining sufficient control over how it's used. This practice is called "naked licensing," and it can have serious consequences for your intellectual property rights. In fact, a business that fails to exercise a certain amount of quality control over its trademark licensees could ultimately lose its exclusive rights to the mark.

How does naked licensing happen?

A trademark does more than identify a company's products or services. It also tells consumers what to expect from the brand. When a business licenses its trademark to another company, it has a responsibility to enforce quality controls over the goods or services offered under that name. For example, imagine that your company licenses its well-established brand name to a manufacturer. You collect royalties but never inspect the products, establish quality standards or monitor how the trademark is being used. If the manufacturer begins selling inferior products under your company's name, consumers may no longer be able to rely on your trademark as an indication of consistent quality. This is precisely the kind of situation that naked licensing rules are intended to prevent.

What are the potential consequences?

Under federal trademark law, failing to maintain adequate quality control over a licensed trademark can constitute abandonment of the mark. That means a court could determine that your business has actually forfeited its trademark rights. The potential consequences are significant:
  • Your company could lose its exclusive right to use the trademark.
  • Competitors may be able to use a similar or identical mark without facing a successful infringement claim.
  • Your business could lose a valuable intellectual property asset that took years to establish.
  • Existing licensing arrangements and future revenue opportunities could be jeopardized.
The best protection starts with a carefully drafted trademark licensing agreement. It should establish clear quality standards, give the trademark owner appropriate inspection and oversight rights and provide remedies when the licensee fails to meet those standards. More importantly, those provisions shouldn't exist only on paper. Businesses should actively monitor compliance and document their quality control efforts. A skilled IP attorney can help businesses structure licensing agreements, address violations and resolve conflicts before valuable trademark rights are threatened. ]]> On Behalf of Cox Padmore Skolnik & Shakarchy LLP <![CDATA[When trade secrets offer stronger protection than patents]]> https://www.cpsslaw.com/?p=51918 2026-10-09T10:46:38Z 2026-10-09T10:46:38Z Long-term protection without public disclosure A U.S. utility patent generally lasts 20 years from the relevant filing date, subject to certain adjustments and exceptions. Owners must also pay required maintenance fees to keep their patents in force. Trade secrets do not require public disclosure or patent filings. Under the federal Defend Trade Secrets Act, information may qualify as a trade secret if it has value because it is not generally known or easy to discover and the owner takes reasonable steps to keep it secret. The Coca-Cola formula is a well-known example. The company has kept its recipe secret for more than a century rather than patenting it. Businesses can also use confidentiality agreements to help protect private information, although these agreements cannot prevent every lawful disclosure.

Costs and legal protection

Patents can involve filing fees, legal costs and ongoing maintenance fees. Trade secrets avoid patent filing and maintenance fees, but businesses must still invest in security. They can limit access to sensitive information and train staff to protect it. The legal rights also differ. Federal patent law protects patented inventions. Someone may break the law by making, using or selling a patented invention without permission. Offering it for sale or importing it without permission may also break the law. Federal trade secret law protects valuable business information. A business can seek legal help if someone improperly obtains, uses or shares its trade secrets. However, the law does not stop competitors from developing the same idea on their own. They may also discover the information through lawful methods, such as reverse engineering.

Choosing the right protection

Trade secrets can protect valuable methods as they improve, without requiring a new patent application for every change. For example, a factory may keep its production process secret while making improvements. Patents may offer stronger protection when competitors can easily copy or discover an invention. A patent can protect the invention covered by its claims, even if a competitor develops it independently. The best choice depends on the invention, the risk of copying and the business's ability to keep information secret.]]> On Behalf of Cox Padmore Skolnik & Shakarchy LLP <![CDATA[Corporate governance failures in small and mid‑sized companies]]> https://www.cpsslaw.com/?p=51907 2026-09-30T17:03:03Z 2026-09-30T17:03:03Z Small and mid‑sized companies can face governance challenges that often escalate quickly when oversight is weak or not applied consistently. This can happen because business growth often outpaces internal controls, leaving the leadership vulnerable to operational disruption and regulatory exposure.  When governance failures occur, they tend to affect financial stability and long‑term business continuity. As a business owner, correcting these failures is essential.

Red flags that signal governance breakdowns

Several warning signs indicate that your company’s corporate governance framework may be deteriorating:
  • Unclear decision‑making authority
  • Inconsistent financial reporting practices
  • Concentrated control in one individual without checks
  • Poor documentation of major business actions
  • Frequent conflicts among owners or managers
Issues like these often begin gradually, but they can create significant risk once they begin affecting daily operations or strategic planning.

Potential legal consequences of governance failures

Breakdowns in governance can lead to serious legal outcomes for small and mid‑sized companies. Regulatory agencies may impose penalties when reporting obligations are not met or internal controls fail to prevent misconduct.  Disputes among owners can lead to claims involving breach of fiduciary duty, mismanagement or misuse of company assets. In serious cases, governance failures can result in business litigation that affects operations, financial health and long‑term viability. Effective governance helps companies avoid negative consequences and maintain a stable operating environment.

Prevention strategies that strengthen oversight

Companies can reduce exposure by implementing structured oversight measures, such as:
  • Establishing defined roles for leadership and management
  • Creating reliable reporting systems for financial and operational data
  • Maintaining accurate records of meetings and major decisions
  • Conducting periodic internal reviews of compliance and risk
  • Developing succession plans for key leadership positions
A consistent framework helps you maintain business stability as you expand or adapt to market changes. Don't know where to start? Talk with someone who understands the importance of corporate governance in New York.]]> On Behalf of Cox Padmore Skolnik & Shakarchy LLP <![CDATA[How percentage rent clauses affect NYC retail tenants]]> https://www.cpsslaw.com/?p=51905 2026-09-29T10:34:13Z 2026-09-29T10:34:13Z How percentage rent clauses work A percentage rent clause links rent to a store's sales by setting a sales threshold called a breakpoint. When sales exceed this amount, the landlord receives a percentage of the extra sales. Commercial lease agreements may use different methods to calculate percentage rent, with some leases applying the percentage to all sales from the first dollar and others charging extra rent only on sales above the breakpoint. The exact terms depend on the lease.

How percentage rent affects profits

Percentage rent can make it harder to plan business expenses because higher sales may lead to higher rent payments, which can reduce the profit a store earns during busy periods. Tenants must also check how the lease defines gross sales, as some agreements exclude certain sales or types of income. Disputes may arise over sales reports, excluded income or breakpoint changes, and landlords may review sales records to check reported figures.

What tenants should negotiate

Tenants can negotiate percentage rent terms before signing a lease by seeking a higher breakpoint, a narrower definition of gross sales or a cap on annual percentage rent. These terms can help control rent costs and protect profits, while reviewing how the lease handles sales reports, audits and disputes can help tenants understand their obligations. A real estate attorney can explain these terms and help identify risks.

How to protect your business

Before signing, review the full lease and estimate how percentage rent could affect your costs at different sales levels, making sure you understand the breakpoint, payment rules and reporting duties. Reviewing these terms can help you plan your budget and avoid unexpected rent costs.]]> On Behalf of Cox Padmore Skolnik & Shakarchy LLP <![CDATA[When does liability end under a New York good guy guaranty?]]> https://www.cpsslaw.com/?p=51861 2026-09-28T07:47:21Z 2026-09-28T07:47:21Z What conditions can end your liability? A good guy guaranty generally limits your responsibility to obligations that become due before the tenant surrenders the space. Surrender means giving up possession and returning the property to the landlord. Depending on the agreement, the conditions may include:
  • Giving advance written notice in the manner and timeframe stated in the guaranty
  • Vacating and surrendering the space in the condition required by the agreement, which may include leaving it broom clean, meaning cleared of belongings and debris
  • Removing subtenants, occupants or property when required
  • Paying rent or other covered charges that accrued before surrender
If you miss a required notice or surrender term, your personal liability as the guarantor may continue. The guarantor is the person who signed the guarantee.

Does the landlord have to accept the surrender?

Not necessarily. In a 2025 decision, the New York Court of Appeals held that a guarantor’s liability ended when the tenant satisfied the surrender conditions in the particular guaranty. Because the agreement did not require the landlord to accept the surrender, acceptance was not an additional condition. The court also distinguished the guarantor’s obligations from the tenant’s. Although the guarantor’s liability ended, the tenant remained responsible for rent due after it surrendered the space.

Review the conditions before relying on the guaranty

A good guy guaranty can limit your personal exposure, but only under the conditions stated in the agreement. Understanding the notice, surrender and payment requirements can clarify what must occur before your liability ends and what obligations may remain. Legal guidance can help you interpret those terms alongside the lease and identify conditions that could affect your personal liability before a surrender dispute arises.]]> On Behalf of Cox Padmore Skolnik & Shakarchy LLP <![CDATA[NDAs protect IP and other information in mergers and acquisitions]]> https://www.cpsslaw.com/?p=51858 2026-09-19T01:38:25Z 2026-09-19T01:38:25Z Non-disclosure agreements play a pivotal role in mergers and acquisitions by allowing companies to share sensitive and confidential information. The type of information that parties need access to and the specific people who need that access change from the earliest meetings to the progression of the merger or acquisition, whether it moves forward or the deal falls through. Carefully timed and written NDAs help balance necessary transparency with confidentiality. They also codify financial and other remedies for any breaches. In a merger or acquisition, it’s critical to provide the relevant parties with information about IP such as patents, trade secrets and more. It’s also necessary to provide financial data, customer lists, employee records and sales and profit projections. 

Why multiple NDAs are often necessary

NDAs are typically necessary in the early stages of negotiation, so the appropriate players have the information needed to determine whether to move forward. More parties may need to sign NDAs if negotiations proceed. Some parties may need to sign new NDAs at different stages. However, a well-crafted NDA may be able to protect information through all stages of the deal and afterwards, regardless of what happens with the merger or acquisition. The ability of the parties involved to negotiate the terms of an NDA can be an early test of their ability to work together. Negotiations can show how seriously they take protection of IP and other confidential information and how well they abide by the terms of an agreement. These transactions are highly unique to the individuals and organizations involved and to the types of IP and other information that need to be protected. That’s why those on both sides of a merger or acquisition need their own legal representatives when negotiating and signing these NDAs.]]> On Behalf of Cox Padmore Skolnik & Shakarchy LLP <![CDATA[How business partners can address fiduciary duty breaches]]> https://www.cpsslaw.com/?p=51848 2026-09-11T09:45:56Z 2026-09-11T09:45:56Z How to address a fiduciary duty breach in New York Business partners often have duties to each other and to the business, depending on the type of business and the terms of their agreements. When a partner fails to meet these obligations, it can lead to a failure to fulfill fiduciary obligations. If a partner suspects such a breach, they can:
  • Review the governing agreements: Partnership agreements, operating agreements and other business documents can help determine whether the suspected conduct violates the agreement.
  • Identify the alleged breach: Determine whether the conduct may have violated any fiduciary duties, such as self-dealing, taking business opportunities or misusing company property.
  • Collect evidence: Once the possible breach is clear, gather records that support the claim. These may include accounting records, agreements, emails and meeting notes. Strong evidence helps if the case goes to court.
  • Assess the harm: The evidence can help show how the conduct affected the company. For example, harm to property, other partners or ongoing deals. The conduct may have provided an unfair benefit to the other partner or reduced the company’s value.
  • Consider remedies: After assessing the harm, consider what type of relief may help. These may include monetary damages for losses caused by the breach. Negotiation or another form of dispute resolution may resolve the issue without going to court.
  • Decide on litigation: If other approaches fail, filing a lawsuit might be the next option. Before proceeding, consider the governing agreements, New York law, the evidence and the costs and benefits. Each step gives partners a clearer picture of the situation before they act. Working through them in order can lead to a fair and effective outcome.

What to consider before taking action

These steps can help partners identify a possible fiduciary breach and understand some options for addressing the situation. Getting legal help early can guide partners through their rights. It can also help them reach a solution that protects the company's interests.]]> On Behalf of Cox Padmore Skolnik & Shakarchy LLP <![CDATA[Repercussions when a subcontractor violates building codes]]> https://www.cpsslaw.com/?p=51846 2026-09-05T03:27:14Z 2026-09-05T03:27:14Z Contractors and subcontractors play essential roles in commercial construction projects. Although most complete their work properly and comply with applicable building codes, mistakes and intentional shortcuts can result in failed inspections, stop-work orders, costly repairs and government fines. When a subcontractor causes a code violation, a business or property owner may understandably expect the subcontractor to bear the consequences. However, responsibility for dealing with the government and ultimate financial liability are not always the same.

Who is responsible for paying code violation fines?

When a local agency discovers a building code violation, the property or business owner may be legally responsible for correcting the problem and paying any associated fines. This may be true even when a subcontractor performed the defective work. Depending on the circumstances, a general contractor, permit holder or another party may also face enforcement action. The owner may be required to address the violation promptly rather than waiting for the parties to determine who caused it. Possible repercussions can include:
  • Financial penalties
  • Stop-work orders
  • Delays in opening or using the property
  • Additional inspections and permit expenses
  • Removal and replacement of noncompliant work
  • Increased labor and material costs
Being cited by the government does not necessarily mean the owner must ultimately absorb every expense. The construction contract may require subcontractors to comply with applicable codes, obtain necessary permits, correct defective work and indemnify the owner or general contractor for losses caused by noncompliance. After paying a fine or arranging for repairs, the owner may be able to pursue reimbursement from the responsible subcontractor. Potential claims could include breach of contract, negligence or indemnification, depending on the contract language and the facts of the case. If the subcontractor disputes responsibility, inspection reports, photographs, correspondence, invoices and project records may help establish what occurred. The written agreement can also become critical evidence in negotiations or litigation. Carefully drafted construction agreements can reduce uncertainty by explaining each party’s responsibilities before work begins. Professional legal guidance can help businesses prepare protective contracts, respond to code violations and resolve disputes when a contractor or subcontractor fails to meet their obligations.]]> On Behalf of Cox Padmore Skolnik & Shakarchy LLP <![CDATA[How companies can challenge a commercial insurance claim denial]]> https://www.cpsslaw.com/?p=51832 2026-08-29T02:58:58Z 2026-08-29T02:58:58Z Modern commercial claim denial tactics Insurers often use forensic accountants and legal teams to build strong defenses. Common grounds for denial include:
  • Property damage and business interruption disputes: Carriers often cite exclusions – flood sub-limits or off-site utility failures – to reject large claims.
  • Contingent business interruption disputes: Carriers may argue a vendor's failure does not meet the threshold for "direct physical loss."
  • Directors and officers (D&O) and professional liability disputes: Insurers often send Reservation of Rights letters in shareholder suits or regulatory investigations, asserting that the alleged conduct may trigger a policy exclusion.
Each denial comes down to how a carrier reads the policy – often narrowly and in its own favor. That reading is where a challenge starts.

Legal and forensic strategies for challenging a denial

Challenging a large claim denial takes more than a formal appeal. A careful, fact-based approach may include:
  • Deconstructing policy architecture: When policy language is ambiguous, contra proferentem may favor the insured. Courts do not apply this rule consistently. Some states limit it for large commercial policyholders. The reasoning is that large companies are presumed to have had the bargaining power to negotiate clearer terms.
  • Reconstructing the forensic proof of loss: Outside accounting and technical reviews can challenge weak denial grounds by introducing independent financial and factual analysis that the carrier's original assessment may not have considered.
  • Pursuing strategic litigation and bad-faith exposure: If an insurer withholds or delays benefits without good reason, the insured may have grounds for a bad-faith claim. That is a legal cause of action – not just a way to pressure the insurer. Depending on the state, remedies can include damages beyond the policy limits, consequential damages, punitive damages, and attorney's fees.
Each of these approaches works best when applied early, before the insurer's position hardens.

What to do after a commercial claim denial

A carrier's denial is not always the last word. Insurers read policies narrowly, and that reading does not always hold up. Reviewing the policy language, the facts and the relevant legal standard can uncover grounds for a challenge. For companies facing significant financial exposure, that review is worth doing before accepting the denial.]]> On Behalf of Cox Padmore Skolnik & Shakarchy LLP <![CDATA[Addressing significant delays in insurance payouts]]> https://www.cpsslaw.com/?p=51812 2026-08-19T15:44:34Z 2026-08-19T15:44:34Z After filing a commercial insurance claim, a significant delay can disrupt the company’s operations. If the property has been damaged, it may be unusable, or operations may proceed at a substandard rate. As a result, the company is actively losing money until those repairs are made. As a general rule, insurance companies need to take certain steps to respond to claims in a prompt and reasonable manner. They need to acknowledge the claim within 15 days, for example. If the company submits the claim and does not hear back from the insurance company for weeks or even months on end, it creates an unreasonable delay. This is an example of a bad faith insurance tactic.

Why does this happen?

There are certainly situations in which it is just a communication issue. Perhaps there is miscommunication within the insurance company itself, and the belief is that the claim has been addressed when no steps have actually been taken. But the reason that unreasonable delays are prohibited is that insurance companies should not intentionally use them to try to get around payouts. If the company delays the process, for example, they may believe that an eventual lowball offer is more likely to be accepted, even though it is not fair and does not address the full costs that relate to the claim. It puts pressure on the commercial entity to take what they can get because the delays are causing them active financial issues. This type of tactic would be unfair and in violation of both state law and the contractual agreement between the insurance company and the commercial entity. However, these types of bad faith insurance tactics do occur from time to time, and it is important for those involved to understand exactly what legal steps they can take.]]>