Companies intending to seek funding under the JOBS Act’s crowdfunding provision gained a seeming advantage in September when the SEC removed its ban on the general solicitation or advertising of certain types of private placements. But this may be less promising than it sounds, says Palo Alto-based Morrison & Foerster corporate and securities partner Timothy J. Harris: “There is a strong undercurrent in Silicon Valley that companies showing their wares this way are openly admitting that they cannot raise capital by traditional means that involve the imprimatur of professional venture capital or private equity investors. This may suggest that the company is of questionable appeal or quality.”
General solicitation can also be an uncertain and expensive means to obtain funding. “You can stick your billboard on the highway, but you still have the costly obligation of reasonably verifying that your investors are accredited, among other requirements,” Harris says. And there are potential downsides to inviting strangers to the party and keeping them happy. Adds Harris, “Imagine having numerous high-maintenance investors bugging you for their returns.”
A New Review Process Shows the Importance of a Good Application
The newly available procedure for challenging patent validity known as inter partes review, or IPR, is forcing patent players to raise their game—from application through litigation.
More than 800 petitions for IPR— many more than the Patent Office itself had expected—have been filed since the process became available in September 2012, according to the USPTO. And while the Patent Trial and Appeals Board issued only one final decision in the first year of IPR, there’s much to be learned from its many rulings on motions so far, says Morrison & Foerster patent attorney Peter Yim.
Representing about 40 million TV households, Germans now receive virtually all on-demand content by Blu-ray Disc or DVD. Video-on-demand services are set to change that over the next three to five years, says Christoph Wagner, a partner in Morrison & Foerster’s new Berlin office. “Look for dynamic, if not explosive interest in VoD as broadband penetration increases and major players consolidate the presently fragmented on-demand market,” says Wagner, an expert in the TMT (technology, media, and telecommunications) sector, key to Germany’s economy. Continue Reading
Hazards Abound for Companies Seeking to Accept Bitcoin
The Bitcoin “Cryptocurrency” has gained momentum in the market, and some businesses, including Overstock. com and TigerDirect.com, now accept bitcoins as payment. Many others are wondering if Bitcoin is a good fit for them—and they should factor regulatory uncertainty into their calculations. Continue Reading