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Amanda Schreyer Speaking on Social Influencers Panel for the Copyright Society of the USA 10/12/2017

Posted by Morse Barnes-Brown Pendleton in Attorney News, Events, Intellectual Property, Internet and E-Commerce.
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AES Headshot Photo 2017 (M1117143xB1386)Curious about who social influencers are and how they develop their careers and business relationships with brands and services? Don’t miss MBBP intellectual property attorney Amanda Schreyer on the Copyright Society of the USA’s panel “Social Influencers: Copyright, Publicity and Social Media Contracting.” Amanda, along with Maria Guerra of Influence Central, will speak about the relationship between social influencers and intellectual property and internet law. The panel will be held on October 30, 5:30-7pm at Northeastern University School of Law.

More information and registration details can be found on the Copyright Society’s event page.

Behind the Curtain: An inside look into the operations of VC firms – MBBP Venture Capital Event, November 7 10/11/2017

Posted by Morse Barnes-Brown Pendleton in Attorney News, Corporate, Events, Financial Services, MBBP news, Venture Capital & Private Equity.
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MRJ Headshot Photo 2017 (M1047116xB1386)Our venture capital event, Behind the Curtain: an inside look into the operations of VC firms, will be held on Tuesday, November 7 from 4:30-6pm at the Cambridge Innovation Center (CIC). Moderated by corporate attorney Mike Jabbawy, the panel will explore how the internal realities of a venture capital firm might have an impact on a technology company looking to build a business based on a venture capital finance strategy. The panel includes:

Dana Callow, Managing General Partner, Boston Millennia Partners
Frank Castellucci, General Counsel & Partner, Accomplice
Juan Luis Leung-Li, Partner, Tectonic Ventures

Space is limited!  View our event page for more information and to register for the event.

American Cancer Society Awards David Sabatini of Whitehead Institute with Five-Year Renewable Research Professorship 10/03/2017

Posted by Morse Barnes-Brown Pendleton in Client News, Life Sciences, Nonprofit.
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David Sabatini, MD, PhD, of MBBP client Whitehead Institute for Biomedical Research, was awarded the prestigious five-year renewable American Cancer Society Research Professorship. The award is part of a larger approval of funding for 78 research and training grants totaling $39,836,250.

According to the press release, Sabatini “looks to maximize the precise targeting of cancer drugs into the relevant tissues by exploiting the specificity of transport proteins embedded in lipid membranes on the surface and within cells. If successful, this approach could address a major challenge in drug delivery and could lead to safer and more effective cancer therapies.”

Congratulations to Mr. Sabatini. More information can be found in the press release.

Attack of the Indirect Investor, Again 09/28/2017

Posted by Morse Barnes-Brown Pendleton in Attorney News, Financial Services, Private Investment Funds & Advisers.
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JHW Headshot Photo 2016 (M0990045xB1386)A Texas-based retirement fund that does not own any Uber securities sued Uber and its former chief executive officer Travis Kalanick for making misleading statements to investors. The retirement fund claims that it was harmed when the value of its indirect investment in Uber fell after investors learned that Uber was “operating a business far different than what investors had been led to believe.” In the follow-up article to his previously published piece, Attack of the Indirect Investor, private funds attorney Josh Watson outlines yet another case involving a lawsuit by indirect investors, and the consequences for investment managers.

Read Attack of the Indirect Investor, Again. For more information, please contact Josh Watson or a member of our PIFA practice.

SEC Targets Broken Deal Expenses, Again 09/26/2017

Posted by Morse Barnes-Brown Pendleton in Financial Services, Private Investment Funds & Advisers, Venture Capital & Private Equity.
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JHW Headshot Photo 2016 (M0990045xB1386)By: Josh Watson

Private equity firm Platinum Equity Advisors, LLC (Platinum) improperly charged broken deal expenses to three of its private equity fund clients, according to a settlement with the Securities and Exchange Commission on September 21, 2017. The settlement requires Platinum to reimburse its clients for $1.7 million of improper charges and pay a $1.5 million civil penalty.

Platinum advises private equity funds Platinum Equity Capital Partners L.P., Platinum Equity Capital Partners II, L.P., and Platinum Equity Capital Partners III, L.P. These are multi-investor, multi-investment private equity funds that have capital commitments of $700 million, $2.75 billion, and $3.75 billion, respectively. Platinum also forms and advises co-investment vehicles that invest alongside the firm’s private equity funds.

Platinum disclosed to investors that its private equity funds would be responsible for bearing their own broken-deal and other expenses, including “[a]ll out-of-pocket fees, costs, and expenses, if any, incurred in developing, negotiating, and structuring prospective [p]ortfolio [i]nvestments that are not ultimately made.” Platinum also disclosed to investors that it would establish co-investment vehicles that invest alongside its private equity funds.

Platinum’s disclosure of broken deal fees was inadequate, according to the SEC, because Platinum failed to disclose the fact that its private equity funds would bear 100% of all broken deal expenses and that Platinum’s co-investors, who benefit from Platinum’s sourcing of private equity transactions, would bear none of these expenses.

In finding that Platinum’s disclosures were inadequate, the SEC focused on specific statements in the funds’ partnership agreements and private placement memoranda. Each fund’s partnership agreement stated that the fund would be responsible for expenses “of the [p]artnership.” Each fund’s private placement memorandum stated that the fund would pay all expenses “related to its own operations.” The SEC apparently interpreted the references to expenses “of a [p]artnership” and a partnership’s “own expenses” to mean the partnership’s proportionate share of such expenses.

By allocating all broken deal expenses to its private equity funds without adequately disclosing this practice to prospective investors, Platinum violated Section 206(2) of the Advisers Act, which prohibits an investment adviser from engaging in any transaction, practice, or course of business which operates as a fraud or deceit upon any client or prospective client.

The SEC’s settlement with Platinum does not break new ground. The SEC previously alerted the investment community to its concerns about how firms allocate broken deal expenses in its 2015 enforcement action against Kohlberg Kravis Roberts & Co. The takeaway for managers is that proper advance disclosure is required when a firm client is required to bear a disproportionate amount of expenses related to deals that are never actually consummated.

Read more about the settlement:

https://www.sec.gov/litigation/admin/2017/ia-4772-s.pdf

https://www.sec.gov/litigation/admin/2017/ia-4772.pdf

OCIE Issues Risk Alert on Misleading Advertising Practices 09/22/2017

Posted by Morse Barnes-Brown Pendleton in Financial Services, Private Investment Funds & Advisers.
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JHW Headshot Photo 2016 (M0990045xB1386)By: Josh Watson

The SEC’s Office of Compliance Inspections and Examinations (OCIE) issued a risk alert on September 14, 2017 identifying misleading advertising practices that examiners have found during examinations of registered investment advisers.

The misleading practices identified in the alert are those that are widely-known to be misleading. For example: (1) Presenting performance results on a gross basis, rather than a net-to-investor basis; (2) Presenting profitable investments without disclosing unprofitable investments made during the same time period; and (3) Presenting hypothetical and back-tested performance results without disclosing other information that an investor would need to evaluate the relevance of the results.

The fact that OCIE issued a risk alert on this topic suggests that OCIE may be seeing an uptick in misleading advertising practices. Having now been warned, advisers should evaluate whether their advertising practices comply with regulatory and fiduciary requirements, and whether they have adequate procedures in place to ensure continued compliance with these requirements.

For more information, read the full alert.

Attack of the Indirect Investor 09/21/2017

Posted by Morse Barnes-Brown Pendleton in Attorney News, Financial Services, Private Investment Funds & Advisers.
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JHW Headshot Photo 2016 (M0990045xB1386)A company’s indirect investors may sue the company and its principals for fraud, according to a recent federal court ruling in Robert Colman et al. v. Theranos Inc. et al. Private funds attorney Josh Watson discusses the case in his article “Attack of the Indirect Investor.” He explains that investment managers who syndicate investment opportunities through single purpose vehicles (SPVs) should be concerned about the ruling because it undermines their control over potential disputes with portfolio companies and their relationships with portfolio company management.

Read the full article on our website. For more information, please contact Josh Watson or a member of our PIFA practice.

Josh Watson Moderating Private Equity and VC Funds Program at ABA Business Law Section Annual Meeting 09/14/2017

Posted by Morse Barnes-Brown Pendleton in Attorney News, Events, Financial Services, Private Investment Funds & Advisers, Venture Capital & Private Equity.
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JHW Headshot Photo 2016 (M0990045xB1386)At this year’s ABA Business Law Section Annual Meeting, private funds attorney Josh Watson will serve as the program chair and moderator for the program “End of Life Issues for Private Equity and Venture Capital Funds.” The program will be presented by the Private Equity and Venture Capital committee and will cover issues faced by private funds as they approach the end of their life spans. Topics include term extensions, secondary sales, restructurings, and conflicts of interest.

The program will be held this Friday, September 15 at 8am. For more information, view the meeting guide.

Skelmet Creates Custom-Built Sport Sunglasses Using 3-D Technology 09/14/2017

Posted by Morse Barnes-Brown Pendleton in Client News, Computer Software & Hardware, Manufacturing, Retail & Service.
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MBBP client Skelmet’s Falcon 1 sport sunglasses are custom-built to perfectly fit your face and are ideal for athletes. They are created using 3-D scanning and printing technology and Skelmet’s design algorithm. The order process for the glasses includes a 3-D scan of the face, which is then entered into Skelmet’s A.I. Fit design system, after which the glasses are 3-D printed.

Skelmet’s cofounder Rain Wang, a former triathlete, created the company from her growing frustration of the fit of mass-produced sports products. Skelmet mass customizes all of its products so that consumers can find their individual fit.

To learn more about Skelmet’s Falcon 1 sunglasses, read the full article in the Boston Globe.

Carl Barnes Comments on Earnout Disputes in Startup Acquisitions in Wall Street Journal 09/05/2017

Posted by Morse Barnes-Brown Pendleton in Attorney News, Corporate, Life Sciences, M&A.
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CFB Headshot Photo 2015 (M0846497xB1386)The Wall Street Journal article “Rise of ‘Earnouts’ Muddies M&A Waters” discusses the increasing landscape of earnout agreements in startup acquisitions. As the article states, earnout agreements are often used in order to settle differences over a company’s valuation, but are frequently leading to disputes over milestone payments. MBBP corporate partner Carl Barnes remarks that:

Concern about the potential for earnout disputes is leading startups to take proactive measures, such as creating escrow accounts to fund legal battles. Typically, funds for the escrow come off the top of the cash paid up front. If the funds are never used, they are disbursed to shareholders.”

Additional measures involve how the earnout agreements are initially structured and negotiated within the deal. For more information, read the full article.

TechCrunch Names Escher Reality One of of Top 7 Startups at Y Combinator S’17 Demo Day 08/29/2017

Posted by Morse Barnes-Brown Pendleton in Client News, Computer Software & Hardware, Games & Interactive Entertainment.
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TechCrunch named MBBP client Escher Reality one of the top seven startups from the Y Combinator Summer 2017 Demo Day part 1. Y Combinator’s Demo Day is an opportunity for the companies that participated in its intensive pitch preparation program to present their company to investors.

Escher Reality is an augmented reality data platform that collects AR mapping data from camera phone videos and allows other developers to build on the augmented reality experience. TechCrunch picked them as one of their top seven startups because:

AR is becoming the next big trend in consumer software. But the physical world is vast, and both developers and platforms will need assistance getting mapping data for everywhere.”

Congratulations to Escher Reality on this recognition. More information can be found on TechCrunch.

More Money for Life Sciences? 08/24/2017

Posted by Morse Barnes-Brown Pendleton in Intellectual Property, Life Sciences.
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By: Erin Bryan

EEB Headshot Photo 2015 (M0846503xB1386)A new legislative proposal to provide a five-year, $500 million life sciences initiative was recently announced by Governor Charlie Baker. This initiative would extend the current 10-year, $1 billion initiative that is set to expire at the end of the next fiscal year and would continue to be managed by the Massachusetts Life Sciences Center. The proposal includes $295 million in capital authorization and up to $150 million in job-creating tax incentives.

The focus of the new initiative will be on job training and career development, with strategic priorities being to strengthen the state’s skilled workforce pipeline, expand opportunities for companies to access both private and public investment resources, develop new scientific innovations that deliver better outcome, affordable therapies to patients, and continue to lead the convergence revolution in digital health, biopharma, medical devices and engineering.[1]

The announcement of the legislative proposal at the 2017 BIO International Convention in San Diego was well received by those in the industry, with many expressing their excitement and support for the continued investment in the Massachusetts life sciences sector. Nonetheless, this will bear continued watching, particularly in view of the significant budget gap facing the Commonwealth.

For more information, please contact Erin Bryan.

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  1. Press Release: “Baker-Polito Administration Proposes Life Sciences Initiative,” June 19, 2017. http://www.mass.gov/governor/press-office/press-releases/fy2017/administration-proposes-life-sciences-initiative.html

MBBP Welcomes Intellectual Property Attorney Amanda Schreyer as Counsel 08/23/2017

Posted by Morse Barnes-Brown Pendleton in Attorney News, Computer Software & Hardware, Games & Interactive Entertainment, Intellectual Property, Internet and E-Commerce, MBBP news, Publishing & Media.
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AES Headshot Photo 2017 (M1117143xB1386)We are pleased to announce the addition of Intellectual Property Counsel Amanda Schreyer.

Amanda will continue to concentrate her practice on privacy and data security, licensing and strategic alliances, trademark, and transactional matters. Schreyer’s clients include video game and software developers, digital influencers, media publishers, influencer marketing agencies and other intellectual property holders.

Amanda regularly advises clients on such matters as sweepstakes and contest rules and regulations, native advertising and sponsored content, and FTC endorsement and disclosure requirements. She has substantial experience negotiating film, television, and book deals, and is very knowledgeable about talent collective bargaining agreements. Amanda prosecutes trademarks at the U.S. Patent and Trademark Office, and also advises creative entrepreneurs in connection with a variety of transactional matters.

We invite you to contact Amanda directly.

Inc. Magazine Includes Dane Street on List of Fastest Growing Private Companies for 5th Consecutive Year 08/22/2017

Posted by Morse Barnes-Brown Pendleton in Client News, Life Sciences.
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Dane Street Client Logo (M0739750xB1386)For the fifth consecutive year, MBBP client Dane Street has been included on Inc. Magazine’s exclusive List of Fastest Growing Private Companies in America. Inc. Magazine lists Dane Street’s 3-year growth as 141%. Dane Street provides Independent Medical Examination and Peer Review services to the auto, disability, group health, pharmacy, and workers’ compensation industries.

Congratulations to our client on this well-deserved recognition.

Lisa Warren Examines the Value of In-Person Interviews for Expediting Patent Allowance in Mass. Lawyers Weekly Article 08/15/2017

Posted by Morse Barnes-Brown Pendleton in Attorney News, Intellectual Property, Life Sciences.
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LMW Headshot Photo 2015 (M0846622xB1386)In her Massachusetts Lawyers Weekly article “Expediting Patent Allowance with In-Person Interviews,” patent attorney Lisa Warren explains why it may be beneficial to take advantage of in-person interviews with the U.S. Patent & Trademark Office in order to expedite the allowance of a patent. Although options such as telephone or video conference interviews may be available and more convenient, Lisa notes:

sometimes there is simply no substitute for direct interpersonal interaction with an examiner to build rapport and improve the mutual understanding of the issues.”

Additionally, Lisa addresses relevant considerations when deciding if in-person interviews are preferable during the patent application process, as well as requirements for the interview itself. These and other insights from Lisa can be found in the full article.

Lisa McKerracher of BioAxone BioSciences Joins Advisory Panel for Christopher Reeve Foundation 08/10/2017

Posted by Morse Barnes-Brown Pendleton in Client News, Life Sciences.
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Lisa McKerracher, CEO of MBBP client BioAxone BioSciences, has accepted the role of Consortium Advisory Panelist for the Christopher & Dana Reeve Foundation. Dr. McKerracher will “direct the foundation’s focus toward the identification, development, and translation of potential Spinal Cord Injury (SCI) therapies into the clinic.”

BioAxone BioSciences is a clinical-state biopharmaceutical company developing regenerative therapeutic drugs based on a deep understanding of axon regeneration and neuronal signaling pathways. The Christopher & Dana Reeve Foundation is dedicated to advancing quality of life and discovering cures for spinal cord injury.

More information can be found in the full release.

David Sabatini To Be Awarded 2017 Dickson Prize in Medicine 08/10/2017

Posted by Morse Barnes-Brown Pendleton in Client News, Life Sciences.
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whitehead-institute-client-logo-sm-m0055040xb1386Biologist David Sabatini of MBBP client Whitehead Institute will receive the University of Pittsburgh’s 2017 Dickson Prize in Medicine. The Dickson Prize in Medicine is awarded annually to a leading American investigator who is engaged in innovative, paradigm-shifting biomedical research.

Sabatini discovered mTOR, a key cellular regulatory metabolic pathway. In addition to being a member of the Whitehead Institute for Biomedical Research, he teaches biology at MIT and is a senior associate at the Broad Institute of MIT and Harvard University. He is also a member of the MIT Koch Institute for Integrative Cancer Research and is a Howard Hughes Medical Institute investigator.

The award will be presented to Sabatini in October at the University of Pittsburgh’s Science 2017 event. More information can be found on the University’s Dickson Prize in Medicine page.

Bach Pharma’s GVT Drug Reverses Brain Dysfunction, Report Shows 08/09/2017

Posted by Morse Barnes-Brown Pendleton in Client News, Life Sciences.
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Firm client Bach Pharma’s GVT drug successfully reverses brain dysfunction and therefore may be an effective treatment for victims of Gulf War Illness (GWI), according to a Department of Defense report on the results of a multi-year pre-clinical study conducted by Ashok K. Shetty, PhD, Associate Director and Professor at the Institute for Regenerative Medicine at the College of Medicine at Texas A&M University System. GWI is prevalent among servicemen and women from the Gulf War and can cause memory impairment, depression, and anxiety. The study was conducted under a grant from the DoD.

GVT has proven both neuro-protective and neuro-generative and could potentially act as a therapeutic treatment for chemical poisoning associated disorders. The fact that GVT regenerates stem cells and neurons was an unexpected finding of this study. Based on these results, Dr. Shetty has established a collaboration with Dena Davidson, PhD, deputy director of research at the Veterans Integrated Service Network (VISN) 17 Center of Excellence for Research on Returning War Veterans to pursue clinical trials in GWI patients.

Congratulations to our client, Bach Pharma, on this extraordinary achievement. Read the full press release for more information.

Mike Jabbawy Participating on Shoobx Startup Panel 08/08/2017

Posted by Morse Barnes-Brown Pendleton in Attorney News, Corporate, Events, Venture Capital & Private Equity.
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MRJ Headshot Photo 2017 (M1047116xB1386)On September 26, corporate partner Mike Jabbawy will take part in the panel “How to Start a Startup”. The panel is part of Shoobx’s Startup Series, which features real life stories from startup founders, investors, and community members. Items of discussion will include choosing a form of entity for a business, choosing co-founders, and how to find assistance to get your business off the ground.

For more information, including registration details, visit our VCs and Startups blog.

NIH/SBIR Grant Awarded to Firm Client BioAxone BioSciences for BA-1049 Inhibitor Research 08/03/2017

Posted by Morse Barnes-Brown Pendleton in Client News, Life Sciences.
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The National Institutes of Health (NIH), Small Business Innovation Research (SBIR), and National Institute of Neurological Disorders and Stroke have awarded firm client BioAxone BioSciences, Inc. with a $1.5 million grant. The grant is for continued research for BioAxone’s Rho Kinase 2 (ROCK2) inhibitor, BA-1049, a transformative drug to treat cerebral cavernous malformation, a serious genetic disease.

BioAxone is a clinical-state biopharmaceutical company developing regenerative therapeutic drugs based on a deep understanding of axon regeneration and neuronal signaling pathways.

Congratulations to our client on receiving the grant and on their revolutionary drug research. For more information, read the full release.

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