August 6, 2015 Student Body University of Puerto Rico School of Law Greetings. Since its launch in AY 2009–2010, the University of Puerto Rico Business Law Journal has attracted authors from almost every continent to portray and critique recent developments in business law and related areas. Conceiving the law as a key instrument for economic development, the Journal’s yearly volume, published in two issues (Winter/Summer), covers a diverse array of topics of interest to business, policy and legal professionals, e.g., corporate & securities law, intellectual property protection, labor & employment matters, taxation affairs, trade & financial regulation, and transactional & financing issues.1 With only six volumes published so far, the pertinence of the subjects addressed by the Journal has earned it a privileged spot among studentedited, specialized, digital legal periodicals.2 Now on its Seventh Volume, the Journal is seeking for talented, enthusiastic law students willing to develop a set of high-valued skills in a collegiate and collaborative environment.3 To be considered for the editorial positions available, please submit the following: 1. An updated résumé, summarizing the qualities you would contribute to the Journal. It should also highlight any recognition that makes you stand out among your peers. 2. A cover letter (CL), not restating what your resume should summarize, 1 To browse the Journal’s previous issues, please visit: http://www.uprblj.org. Law Journals: Submissions and Ranking, 2006–2014, WASH . & LEE U. SCH . L., http://lawlib.wlu.edu/LJ/ index.aspx (last visited June 28, 2015). 3 Our editors are entitled to one (1) academic credit for every volume they work on, up to a maximum of three (3) credits towards their degree. Credits are graded upon the Editorial Board’s assessment of each editor’s performance throughout the year. Although ABA regulations do not allow 1Ls to earn elective credit before the 28-credit threshold, the appropriate annotation on their academic record or transcript will be done. In addition, 1Ls should be aware that editorial experience is highly valued by prospective employers, both in the public and private sectors. 2 but expressing your interest in any of the areas of the law covered by the Journal, and what you expect to gain from your experience as an editor.4 3. A writing sample, either in English or Spanish, demonstrating your mastery of grammar, punctuation, and style. It should reflect familiarity with legal, corporate, commercial, or economic analysis as well.5 4. The attached English and Spanish fragments, properly edited in terms of grammar, punctuation, style, and citation, according to the rules set forth in The Bluebook.6 They should also show the use of the “Track Changes” tool.7 Special Note: Candidates with at least one year of editorial experience in a legal periodical are encouraged to apply for the position of Senior Editor. Senior Editors assist the Editorial Board in supervising both the editorial teams and the designated committees. Qualified applicants should submit the above-mentioned materials, specifying in their CLs their intent and qualifications to become Senior Editors for the Journal’s Seventh Volume. Complete applications will be accepted until 11:59 PM of Sunday, August 23, 2015. They should be sent directly to uprblj@gmail.com, under the subject: Seventh Volume Editorial Staff Application. We look forward to hear from you. Share with us any question that may arise while preparing your application, but keep your deadline in mind at all times. With our best regards, The Editorial Board Seventh Volume University of Puerto Rico Business Law Journal 4 Note that if you choose to submit your resume in Spanish, your writing sample must be in English, and vice versa. 5 1Ls’ writing samples need not to circumscribe to legal, corporate, commercial, or economic affairs. 6 THE BLUEBOOK : A UNIFORM SYSTEM OF CITATION (Columbia Law Review Ass’n et al. eds., 20th ed. 2015). 7 Applicants should feel free to make as many changes as deemed appropriate. Editing Exercise (English) LLS is threatened with immediate and irreparable harm by the unauthorized use of its marks by Chic. LLS granted Chic a license to use its marks, "LEON LEVIN," "PLAY BY LEON LEVIN," "PLAY," and "LL SPORT" (collectively, the "Marks"). The license agreement ("License Agreement") required that Chic make royalty payments to LLS. Chic failed to make such payments despite notice from LLS and an opportunity to cure such default. Chic further breached the License Agreement by, among other things, omitting the symbol ® on labels for apparel bearing the Marks, advertising apparel not bearing the Marks, and joining the Marks with another name absent consent from LLS. LLS terminated the License Agreement and demanded that Chic cease any unauthorized use of the Marks. Chic refused. Chic continues to make unauthorized sales of apparel bearing LLS's distinctive Marks despite the termination of the License Agreement. Chic's unauthorized use of the Marks threatens LLS with immediate and irreparable harm. Consumers will be misled or confused concerning whether LLS, the trademark owner, approved the use of its Marks on goods that are being sold by Chic. Chic's continued unauthorized use of the Marks threatens LLS with a loss of control over its valid Marks. This loss of control will cause LLS to lose the ability to preserve the quality and continued vitality of the Marks. Chic's wrongful acts constitute breach of the Licensing Agreement, trademark infringement, and unfair competition. LLS is likely to succeed on the merits of these causes of action against Chic. Therefore, the Court should issue a preliminary injunction to eliminate the immediate and irreparable threat of harm to LLS caused by Chic's unauthorized use of LLS's distinctive Marks. Since 1925, LLS Has Designed And Sold Quality Women’s Sportswear. For more than 75 years, LLS has been a family business that designs and sells high-end women’s sportswear. LLS, founded by Leon Levin, began designing and selling high quality women’s sportswear in 1925.1 In 1931, LLS began using the mark, "Leon Levin," on its products.2 In approximately 1947, Mr. Levin's four sons, Stanley, Bill, Jess and Bernard, took over and continued the family business.3 (Affidavit of Neil Weiss dated April21, 2003 ("Weiss Aff.") a t 3.) 2 (Id.) 3 ID. 1 In the early 1960's, LLS partnered with Federico International ("Federico"), a knit supplier and clothing designer, to design and sell a line of women’s golf apparel.4 This partnership between LLS and Federico proved enormously successful as LLS's revenues tripled in value5. Liana Neptune were, and still remains, the Chairman and CEO of Federico.6 The successful relationship between LLS and Federico continued to benefit both companies and, in 1982, Stanley, Bill, Jess, and Bernard Levin decided that they wanted to sell LLS to Federico.7 They entrusted their family business to Liana Neptune and Federico because, for the past 20 years, they had worked hand in hand with Mrs. Neptune and knew that he cared about the Levin family tradition for high quality.8 The Levins had all also become close friends with Liana Neptune and trusted him to maintain the reputation that they and their father had built for LLS since 1925. Federico accepted the offer and purchased 51%of LLS. Although Bernard Levin passed away, his three brothers continued to immerse themselves in the day-to-day business of LLS even after Federico assumed majority control. Then, in 1987, Federico purchased the remaining 49% interest in LLS. In keeping LLS as a family owned and operated business, Liana's husband, Hiram Neptune, took over as Stylist and Merchandiser for LLS, and he was a really good stylist.In the early 1990's, the Neptune's children, JJ and Guillermo Neptune, began working for LLS in various roles. Under the direction of Liana and Hiram Neptune, LLS continued to market high-end women's sportswear successfully.In the 1990's, LLS achieved record annual sales of approximately $21 million. Until LLS was sue bai Ropa Boricua Inc. under in a torts action for five million dollars, for physical and moral damages, when a rack fell on top of Carlos Berrios head and rendered him quadraplegic. Mr. Berrios was the head of Ropa Boricua Inc. and the Puerto Rico Independence Party. The case reached all the way to the Puerto Rico supreme court9. The court decide to dismiss Roca Boricua Inc. claim and granted Mr. Berrios only $5,000 for his damages.10 (Id. at 4.) Id. 6 Id. 7 Id. 8 Affidavit of Neil Weiss dated April21, 2003, at 5. 9 Berrios & Ropa Boricua Inc. vs. LLS, 255 DPR 1 (2016). 10 Berrios, 225 DPR at p. 5. 4 5 Editing Exercise (Spanish) Sin embargo, en el Estado de Delaware, si la autoridad en cuestión versa sobre “asuntos extraordinarias o poco usuales”, la autoridad implícita del oficial que actua como Presidente de la empresa podría ser válida como excepción si se relaciona a conducta previa del oficial que demuestre que había actuado de la misma manera a nombre de la corporación y que esta le había autorizado y había reconocido, aprobado y ratificado acciones/decisiones similares previas”.1 Por lo tanto si una corporación ha operado su negocio de forma habitual sin haberle dado autorización formal a su Presidente, entonces éste puede continuar actuando y/o tomando decisiones sin autorización formal.2 Por el contrario, según discutido anteriormente en PR hasta el momento el estado de derecho es cuando el oficial o gerente corporativo tiene ante su consideración algun asunto no ordinario este necesita la autorización expresa de la Junta de directores o que el mandato este dispuesto en los estatutos para poder obligar a la corporación.3 En fin, la mejor práctica de gobernanza corporativa es: obtener una resolución de la junta de directores antes de entrar en cualquier tipo de transacción que tenga características no ordinarias, cosa que en muchas ocasiones una parte contratante precabida y bien asesorada requiere. Según tratadistas de Estados Unidos, para determinar si se trata de un “Asunto Extraordinario” que no les compete a los oficiales y la decisión estaria fuera de su autoridad implícita del mismo están: (1) la magnitud economica o cuantía del asunto en relación a los activos y ganancias corporativas (2) el alcance del riesgo envolvido; (3) el tiempo envolvido y el efecto de la decisión sobre el asunto; y (4) el costo de revertir la decisión.4 Unos ejemplos de asuntos extraordinarios son: incurrir en deuda a largo plazo, la readquisición de acciones, inversiones de capital significativas, combinaciones de negocios, la disposición de parte sustancial del negocios, entrar en nuevas vertientes o línea del negocio, adquisición significativa de acciones de otras corporaciones, y asuntos que puedan exponer la corporación a posibles litigios, acciones legales o a posibles problemas de Reglamentación Gubernamental.5 3. finalmente, el tercer supuesto para determinar si un oficial tiene autoridad, es que la autoridad podría surgir tambien por apariencia, la cual implica que las actuaciones o decisiones de un oficial que no contaba con autoridad expresa o implícita, pero estas podrían obligar a una corporación si la misma da la sensación, aparenta o transmite la idea a personas razonable, que dicho oficial tenía autoridad para hacer lo que hicieron.6 Greenspon’s Sons Iron & Steel Co v. Pecos Valley Gas, 156 A. 350, 5 (1931). en la pág. 9. Hessler v. Farrell, 226 A.2d 708, 712 (1967). 3 Arts. 4.01 - 4.02 de la Ley General de Corporaciones de 2009. 14 LPRA §§ 3561 – 3562 (2011). 4 Principles of Corporate Governance: Analysis & Recomendations §3.01 – Management of the Corporation’s Business: Functions and Powers of Principal Senior Executives and Other Officers (1994). 5 William L. Cary & Melvin A. Eisenberg, Cases and Materials on Corporations, 204-205 (7th ed. 1995) 6 Díaz Olivo, supra nota Error! Bookmark not defined. en la pág. 95. 1 2 La autoridad aparente sólo existe ante terceros y no internamente entre el oficial y la corporación. También, cabe mencionar la doctrina de los “funcionarios Corporativos de facto” la cual establece que cuando un oficial ha actuado y ejércido ciertas facultades administrativas que no tenía por un periodo de tiempo razonable y dichas acciones y/o facultades no han sido impugnadas ni oficial ni públicamente por la corporación, se puede inducir a terceros a creer que tal oficial tiene en realidad la facultad y autoridad para tomar ciertas decisiones.7 Esta se diferencia de la autoridad aparente en que solo existe o reconoce con relación a terceras personas,8 y de la implícita, la cual es parte de las funciones del cargo a la cual ejerce en ese contexto en particular. Basado en lo anterior, podemos concluir, en fin, que la determinación de si un oficial corporativo posee la facultad de vincular y actuar a nombre de la corporación depende de la autoridad que expresamente se le confirió, o la que por uso y costumbre llevó a cabo, o la que aparenta se le confirio.9 Por supuesto haya que considerar la alternativa de que la actuación del oficial no caiga bajo alguno de los supuestos de autoridad antes expuestos, lo que pudiera resultar que la misma fuera ultra vires, esto es que su actuación se haya dado mas alla o en ausencia de la autoridad conferida a un oficial por la corporación y por ende no vincule a la corporacion. Sin alguna duda, si el oficial o empleado actúa de manera ultra vires, extralimitandose en sus funciones la corporación pudiera responder de forma vicaria por los posibles daños causados por tal actuación. Claro está el oficial o director que actuo de manera ultra vires y le causo algún tipo de daño a la corporación podría ser responsable, ante esta por motivo de una violación a sus Deberes de Fiducia.10 7 Negrón Portillo, supra nota _______________ en la pág. 182 8 9 Id. Fletcher, supra nota Error! Bookmark not defined., 2A FLETCHER CYC. Corp. § 511 (West 2012). 10