International Law and Immigration

ILS NEWS (October 2024)

Message from the Chair
Theresa Leets
Theresa Leets

It is my privilege and honor to be serving as the Chair for the next CLA term. I am reaching out to you today to share recent highlights from past activities and details about upcoming events.  I am delighted to engage with all the members of CLA and our friends worldwide. Our ExCom members, advisors , other CLA sections and international bar associations collaborate to bring us together for top notch programming and travel experiences. This newsletter will also include substantive articles. This month franchise expert Charles Modell discusses mediating franchise disputes.

Message from Program Chair
John T. Van Geffen
John T. Van Geffen

Looking for ways to get involved? We are planning our program calendar for 2025.

As the Program Chair of California Law Association’s (CLA) International Law and Immigration Section (ILS), I am excited to invite you to contribute ideas for webinars and newsletter articles for inclusion in ILS’ 2025 program calendar.

The ILS newsletter and our section’s webinars serve as a vital platform for members to share insights and expertise on pressing issues within the practice of international law and immigration.

Whether you write an article for the ILS newsletter or present a lunch hour webinar, these opportunities offer numerous advantages for members, it not only enhances your professional development and expertise, but fosters a collaborative community to network among members, creating avenues for mentorship and enriching our legal community. Participating in this knowledge-sharing ecosystem helps your fellow members navigate nascent technology, address new legal challenges in the rapidly evolving fields of international law and immigration and provides needed peer feedback that significantly improves the quality of, and respect in, our internationally honored fields.

Please join our platform today to influence policy discussions, raise awareness about significant issues and enhance your role as advocates within the international law and immigration professions. By sharing your diverse perspectives and insights, contributors benefit practitioners and the public alike.

If you have an article or webinar, you would like to propose, please submit your ideas to: ils@calawyers.org

Past Event Recaps

Delegation to Mexico

August 22 – 23, 2024

Delegation to Mexico group

The delegation to Mexico was organized by Enrique Hernandez-Pulido. The group met with the leadership of three bar associations in Mexico City, The Barra Mexicana de Abogados (BMA), The National Association of Corporate Lawyers (ANADA), and Illustrious and Royal College of Lawyers of Mexico (INCAM) and witnessed the signing of the CLA Friendship Agreement with BMA. The Delegation’s visit included a private tour of the Mexican Senate and Supreme Court with its magnificent building and murals.

ILS Legal Symposium: Law in an Era of Global Challenges: Climate Risk and AI Regulation

On September 5, 2024, the California Law Association’s (CLA) International Law and Immigration Section (ILS) hosted a symposium titled “Law in an Era of Global Challenges: Climate Risk and AI Regulation” at Santa Clara University. This event was part of the CLA Annual Meeting and Leadership Conference and attracted a diverse audience of attorneys, students, faculty, and international delegates. The symposium aimed to address pressing global issues such as environmental risk disclosure and data privacy. It featured two main panels focusing on international and domestic corporate and regulatory approaches to climate risks and the implications of AI.

The environmental panel included distinguished experts:

Nilmini Silva-Send & Vineet Shahani
  • Dr. Silva-Send: Provided insights into environmental risk disclosure and the importance of transparent reporting.
  • Scott Smithline: Discussed regulatory approaches to managing climate risks and the role of policy in mitigating environmental impacts.
  • Tseming Yang: Highlighted international perspectives on climate risk and the need for global cooperation in addressing environmental challenges.

The AI panel was moderated by John T. Van Geffen and featured:

Erin Santana & Goli Mahdavi
  • Erin Santana: Explored the implications of AI on data privacy and the ethical considerations surrounding AI technologies.
  • Goli Mahdavi: Addressed regulatory approaches to AI and the importance of developing frameworks to ensure responsible AI use.

The symposium provided a platform for thought-provoking discussions and fostered collaboration among legal professionals, academics, and international delegates. It underscored the critical role of law in navigating the complexities of global challenges such as climate risk and AI regulation.

We invite you to join the International Law and Immigration Section (ILS) and participate in our future events. Together, we can continue to explore and address the pressing legal issues of our time.

Program is now live in InReach

Miss the in-person program? Purchase both sessions and save 15%! Offer ends 11/30/2024. Click here to view.

Law in an Era of Global Challenges: Climate Risk and AI Regulation graphic
2024 Warren Christoper Awardee: Steven Smith
Steven Smith

Steve Smith was an early pioneer of the practice of international arbitration in California, starting in 1983 with his work on expropriation cases against the Government of Iran and the National Iranian Oil company before the Iran-U.S. Claims Tribunal in the Hague. Steve’s practice, now in its 41st year, has focused on international arbitration of complex, high-stakes disputes in the energy, power, mining, defense, chemical, and life sciences industries. He has significant experience resolving cross-border licensing, distribution, and joint venture disputes, often involving multiple parties. He has been the lead advocate for clients in both ad hoc and institutional arbitrations, including under the UNCITRAL, ICC, LCIA, ICDR, WIPO, DIS, HKIAC, and SIAC Rules, and has handled matters involving foreign states or their instrumentalities from five different continents, including before the Iran-U.S. Claims Tribunal. He regularly serves as an arbitrator in international commercial arbitrations. Recognized as one of the world’s leading international arbitration lawyers in many notable directories, Steve has been described by Chambers Global and other publications as “a truly outstanding advocate whose written product and oral advocacy simply astound”; a “masterful advocate who can put together mesmerizing arguments”; and a “first-class advocate” who is “ferociously well-prepared” and a “master strategist.”

Jeff Daar and Tani Cantil-Sakauye, former Chief Justice of the Supreme Court of California present, the Warren M. Christopher International Lawyer of the Year award.
Jeff Daar and Tani Cantil-Sakauye, former Chief Justice of the Supreme Court of California present, the Warren M. Christopher International Lawyer of the Year award.
ILS ExCom members, advisors, international guests from Japan and Pakistan with Steve Smith.
ILS ExCom members, advisors, international guests from Japan and Pakistan with Steve Smith.

Upcoming Events

Webinars
Disclosing beneficial ownership to prevent money laundering and terrorist financing, from Bakersfield to Bologna

Wednesday, November 20, 2024 @ 9 AM – 10:30 AM (Pacific)
Co-Sponsor: JABA (Japanese American Bar Association)

AML Compliance Graphic

This program will give attorneys background and perspective on the global application of beneficial ownership regulations and tools to ensure compliance, focusing on the EU Anti-Money Laundering Directive and the US Corporate Transparency Act.

Conferences
California International Arbitration Week (CIAW)

Save the Dates: March 10, 2025 – March 14, 2025, in Los Angeles

Ana Sambold, Dana Welsh, Eric Tuchman and Gary Benton networking at the CIAW.
Ana Sambold, Dana Welsh, Eric Tuchman and Gary Benton networking at the CIAW.

Organized as a collaboration of the California Lawyers Association (CLA), California Arbitration (CalArb) and leading arbitration institutions and organizations from around the world, California International Arbitration Week (CIAW) is an annual week-long series of in-person and online programs celebrating international arbitration in California.

Link: https://calarb.org/ciaw/

International Delegations
Delegation Milan/Lake Como, Italy

Save the Date: October 16 – 18, 2025

Milan/Lake Como, Italy
Milan/Lake Como, Italy
Articles
MEDIATING FRANCHISE DISPUTESGOOD FOR BOTH FRANCHISORS AND FRANCHISEES

By Charles S. Modell

Lawyers have argued for decades as to which is the preferable way to resolve disputes, litigation or arbitration.  The better question is which is worse – because neither of these is the best way for businesspeople to resolve disputes.  Enter mediation. 

What is Mediation?

Mediation is a procedure that brings two parties together, with the assistance of a neutral third party, to work out their differences.  Attorneys frequently attend, but they are not required.  The mediator may give his or her opinions to the parties, but the mediator does not make any decisions for them.  Mediation works because, through the mediator, you can suggest settlement options you may be uncomfortable making on your own for fear they would become a floor or ceiling for future negotiations.  And it forces people to talk about their disputes before “going to war.”

Franchisees are not always excited about mediating disputes.  For one reason, mediation adds some initial cost to addressing the dispute.  More on that later.  Sometimes this reluctance is because the mediation provision in the franchise agreement stacks the deck against the franchisee.  However, there is no reason for a franchisor to include a one-sided mediation provision in its agreements.  In fact, doing so sets the wrong tone for a mediation that is intended to help the parties find a mutually acceptable resolution of their dispute.  Enter the neutral, compulsory mediation clause.

What is Neutral, Compulsory Mediation?

A compulsory mediation clause in a franchise agreement typically provides that neither the franchisor nor the franchisee can file a lawsuit against the other until they have offered to mediate.  (This article assumes litigation is the dispute resolution method provided for in the franchise agreement, but the same comments apply when arbitration is required.)  The provision typically applies to both parties, but since there are certain disputes that cannot wait for mediation to be scheduled, a carve-out usually allows both parties to seek injunctive relief to prevent irreparable harm.

The idea of early compulsory mediation is to find a business solution to a business dispute – before the dispute has escalated through litigation.  In the provisions I have drafted, the franchisor does not select the mediator.  Rather, when one party requests mediation, the party receiving the request then selects a mediation organization (not someone’s best friend) that provides mediation services for resolving franchise disputes.  The mediation organization selects the actual mediator to conduct the mediation – though the parties will often agree on a mediator.  The mediator should be familiar with franchising, so that they can provide educated, third-party analysis to both the franchisor and franchisee as to the merits of their positions and help them fashion a creative resolution to what is often a complicated dispute.  Thus, I require that the mediator have at least 10 years of experience as a franchisor, as a franchisee, or in franchise law.  Franchisors may wonder whether this might result in selection of a “franchisee-friendly” mediator.  I generally hope that it does; if our franchisor client’s position is supported by the law and the contract, who better to convince a franchisee that its position lacks merit than someone well versed in franchise law, who is sympathetic to the franchisee’s position?  The same goes for a franchisee who feels they are in the right; who better to convince your franchisor to come to your rescue than a franchisor lawyer who realizes the franchisor has a significant legal problem?

Some mediation provisions require the mediation to be held at the office of the franchisor.  There may be good reasons for a franchisor to want a local venue for its litigation, but requiring the franchisee to travel to the franchisor’s office for mediation sends the message that this is not intended as a neutral negotiation.  These days, mediation can often be conducted virtually.  For in-person mediations, I have found that if all parties are “invested” in the process, then when negotiations stall in the first hour or two, as they often do, everyone works harder to find a resolution than if we are sitting in the office of one of the parties who can simply go back to their desk.  A neutral provision leaves the decision of the mediation venue to the mediator, though I typically provide that absent the agreement of both parties, the mediation must take place at least 100 miles from the office of either party.  This assures that both parties will incur some expense to get to the mediation.

With a neutral mediation provision, neither party should feel threatened by the procedure, and both can work cooperatively to find a business solution to their dispute.  Again, a far better alternative to going to court, spending years in battle, risking the future of one or both businesses – franchisor and franchisee – and paying to send lawyers’ children (and grandchildren) to college! 

Conclusion

Arbitration and litigation both have their pitfalls.  The best advice any attorney can give their client about disputes is to avoid them.  Unfortunately, disputes do occur.  Sending those disputes to mediation does not guarantee they will be resolved.  However, statistics show that most mediated disputes are settled, either through the mediation, or within a short time thereafter.  Any statistics major, or gambler, will tell you that if you have a better than 50/50 chance of getting a result through the expenditure of several thousand dollars in mediation, which will probably save 10 to 50 times that amount in litigation, this is a good bet.  And that is why franchisees should not be deterred from investing in mediation before jumping into what can often be a war of attrition with their franchisor. 

Charles S. Modell

Mr. Modell is an attorney at Larkin Hoffman law firm in Minneapolis, Minnesota.  He has worked in the franchise area for more than 45 years and was an early advocate of mediation of franchise disputes.


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