1. HOT LEGAL TOPICS FOR BUSINESS CONNIE DAI CUTLER & WILENSKY, LLP JUNE 18, 2015 1

2. CONNIE C. DAI, ESQ. Practice business, employment and business litigation Business - transaction, incorporate, draft and review contracts, general corporate matters Employment – wage & hour, wrongful termination, retaliation, misclassification employee and independent contractor, severance, non-compete, non-solicitation, confidentiality Business consulting in Canada and U.S. B.A. from China, M.B.A. from Canada and J.D. from US Licensed in Massachusetts and New York State Rated a Super Lawyer in business/corporate practice by Super Lawyers Magazine in 2014 2

3. HOW TO PROTECT CONFIDENTIAL INFORMATION It has to be used and convey competitive advantage Information of customers, financials, production methods, technology, procedures Information in public domain cannot be protected Reasonable protective measures have to take place Important for technology centered business 3

4. EMPLOYER’S DUTY Clearly define the trade secrets in multiple documents Document what employee brings in – technology Limit access on need-to-know basis Document corporate policies/employee handbook Meet, explain, inform in writing, have employee’s written acknowledgement Sign NDA or insert a provision in other agreements Reaffirm duty not to disclose at exit interview Old employer - write to employee’s new employers New employer – confirm with employee if he is under any contract or have him make representation 4

5. EMPLOYEE AND OTHERS’ DUTY Common law, contractual or statutory based Know of such duty Know clearly what trade secrets are If asked to sign agreement read and understand contract Cautious about what to post in social networking Do not disclose or abuse Officers, directors or shareholder, separate from business, may be liable for taking technology 5

6. NON-COMPETE IN EMPLOYMENT Only contractually protected - no contract no protection Balance legitimate business interest v. employee’s right to make a living Valid for only protecting legitimate business interest  Goodwill  Protect trade secrets  Protect confidential information Prevent employee from working for competitors is not legitimate business interest Reasonable in time and space Employee may use general skill and knowledge 6

7. NON-COMPETE IN BUSINESS SALES Court has less scrutiny than it has on employees Buyer makes sure a non-compete provision in contract especially goodwill is large part of assets for sale Reasonable in space and time Even if non-compete clause is not in, court most likely implies 7

8. EMPLOYMENT MUST KNOW At-will Employment agreement is not required by law Assignment of intellectual property Non-solicitation duty Severance pay is not required by law Higher level employee has fiduciary duty to employer – President, Director, high level manager, board member Misclassify employee as independent contractor 8

9. FIDUCIARY DUTY Common law and statutory based Shareholder to employer and other shareholders High level employee to employer Duty of care Duty of loyalty Corporate opportunity 9

10. CHINA MONEY U.S. THECNOLOGY COLLABORATION Who owns technology – school, inventor, company? Assign or license? Who owns derivative invention based upon existing technology? Tax consequence on Chinese company/individual owner Culture differences between China v U.S. Due diligence of all parties Share transfer or exit 10

11. Q & A 11