The Predominant Factor Test: Determining Whether the UCC or Common Law Applies to Mixed Contracts for Goods and Services

Construction law in the United States consists of two main bodies of legal rules. The first, federal law, applies to contracts involving the U.S. government and its agencies. The second, state law, applies to pretty much everything else. While each state is different, all states generally have two types of laws: (1) common law and (2) statutory law. One of the more frequently encountered statutes in the construction context is Article 2 of the Uniform Commercial Code (UCC), which has been enacted in all 50 states and applies to contracts involving the sale of goods. Contracts involving the sale of services, on the other hand, are generally governed by the common law. So, what happens when a contract involves a mix of goods and services?
The North Carolina Court of Appeals addressed that issue last week in Demaria Building Co. v. Laboratory Design, (Case No. COA 24-882, June 18, 2025). That case involved a contract to manufacture and install custom-made cabinets and countertops. A key issue was whether the parties had actually formed a contract, which depended on whether common law or the UCC applied. To answer that threshold question, the court applied the predominant factor test:
Where the predominant factor of a contract is the rendition of services with the sale of goods incidentally involved, the UCC is not applicable. However, where the predominant factor of the contract is the sale of goods with the provision of services incidentally involved, the UCC controls. Factors which have been used in determining whether a mixed contract should be governed by the UCC include the following: (1) the language of the contract, (2) the nature of the business of the supplier, and (3) the intrinsic worth of the materials.

In Demaria, the sale of goods predominated because, among other reasons, the installation services comprised only about 10% of the total contract price and the nature of the conflict involved material cost increases only, not installation. The court therefore applied the UCC to determine whether the parties had actually formed a contract. Under the UCC, parties can enter contracts for the sale of goods “in any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of such a contract.” In Demaria, the parties did not both execute the contract document but nonetheless conducted themselves as though a contract existed. Such conduct consistent with the existence of a contract included manufacturing the goods, offering and accepting payment, and submitting change orders pursuant to the provisions of the unsigned contract. Under those circumstances and under the UCC rules of contract formation, the parties’ conduct was sufficient to establish a legally enforceable contract.
Demaria is a good reminder that mixed contracts for goods and services may be governed by either the UCC or the common law, that those two bodies of law are not always the same, and that which law applies could be outcome determinative. A copy of the court’s opinion is available here.
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When It Comes to Objective Criteria of Nonobviousness, Nexus Is Looser for License Evidence

The US Court of Appeals for the Federal Circuit partially reversed a decision by the Patent Trial & Appeal Board, effectively relaxing the nexus requirements for patent licenses pertaining to their usage as objective indicia of nonobviousness. Ancora Technologies, Inc. v. Roku, Inc. et. al., Case Nos. 23-1674; -1701 (Fed. Cir. June 16, 2025) (Lourie, Reyna, Hughes, JJ.) (per curium).
Ancora owns a patent directed to limiting software use on a computer through license verification. The patented technology centers on storing an “agent,” which is a license verification program, in a computer’s basic input/output system (BIOS) rather than in volatile memory. In 2021, Nintendo, Roku, and VIZIO separately filed petitions for inter partes review (IPR) challenging claims of Ancora’s patent. The Board consolidated the proceedings and ultimately found certain claims of the patent unpatentable as obvious over a combination of two prior art references: Hellman (which discloses storing license information in nonvolatile memory) and Chou (which discloses a BIOS-level security routine). Ancora appealed.
Ancora raised three issues on appeal:

That the Board erred in construing the claim term “agent”
That even if the Board correctly construed “agent,” it nonetheless erred in determining obviousness under 35 U.S.C. § 103 based on a combination of Hellman and Chou
That the Board erred in its analysis of secondary considerations of nonobviousness.

The Federal Circuit affirmed the Board’s construction of “agent” to mean “a software program or routine” with no further limitations. The Court disagreed with Ancora’s argument that “agent” was limited to use in software only, primarily because neither the patent nor prosecution history provided any disclaimer of hardware. For similar reasons, the Court also disagreed with Ancora’s argument that “agent” was limited to use at the operating-system level.
On the obviousness determination, the Federal Circuit upheld the Board’s conclusion that the combination of Hellman and Chou rendered the claims prima facie obvious. The Court rejected Ancora’s argument that the Hellman/Chou combination would not provide motivation to combine since they are redundant.
The Federal Circuit disagreed with the Board’s analysis of the objective indicia of nonobviousness, particularly the treatment of Ancora’s licensing evidence. The Board found that Ancora failed to establish a sufficient nexus between the claimed invention and evidence of two objective indicia of nonobviousness: industry praise and licensing.
The Federal Circuit agreed with the Board on industry lack of nexus for the alleged praise (where the Board found that praise for the invention in a press release and an agreement between Ancora and another company offering products using the patent was directed broadly to the patent and not specifically to the challenged claims). However, the Court found that the Board erred regarding the appropriate nexus as it relates to Ancora’s licensing evidence.
The Board found that Ancora failed to show a nexus between the challenged claims and two licenses it obtained through settlement agreements in other cases. The Federal Circuit disagreed, finding that the Board applied an overly stringent nexus standard inconsistent with precedent. While products may require detailed analysis to show a nexus because of the presence of unclaimed features, the Court explained that licenses, by their nature, are directly tied to the patented technology and do not require the same level of scrutiny. The Court also agreed with Ancora that the substantial license payments, the defendants’ awareness of relevant prior art, and the fact that the licenses covered all of the challenged claims supported a nexus. Additionally, the Court found that the Board misread one of the licenses and failed to properly evaluate its significance. Concluding that the Board erred in its analysis of secondary considerations, the Court remanded the case for reconsideration of the nexus issue as it pertains to Ancora’s licensing evidence.

A SHARP DISSENT: A Review Of The Dissent’s Take On The Supreme Court’s Ruling In McLaughlin.

Let’s Get You Up To Speed
In McLaughlin Chiropractic Assocs., Inc. v. McKesson Corp., No. 23-1226, 2025 WL 1716136 (U.S. June 20, 2025), the Supreme Court determined that the Hobbs Act does not bind district courts in civil enforcement proceedings to adopt an agency’s interpretation of a statute. Rather, district courts must make their own determinations under ordinary principles of statutory interpretation while affording appropriate respect to the agency’s interpretation. According to the Supreme Court, the phrase “determine the validity” merely bars a district court from striking down the agency order outright– it does not prevent them from applying a different rule of law where the agency’s interpretation is deemed inapplicable.
As a result, the Supreme Court applied a “default rule” which permits district courts to review and depart from agency action when appropriate.
The Dissent
Justice Kagan, joined by Justices Sotomayor and Jackson, dissented.
“Ship first, litigate later… [A]s the majority sees things, the Act ‘does not preclude district courts’ from declaring a rule or order invalid years after it issued, at the behest of a party who declined to seek judicial review in the first instance.”

McLaughlin Chiropractic Assocs., Inc. v. McKesson Corp., No. 23-1226, 2025 WL 1716136, at *13 (U.S. June 20, 2025).
The dissent highlights a simple idea: when Congress has created a framework – like the Hobbs Act – for how and when to challenge agency interpretations, courts should yield to that structure. Under the Hobbs Act, agency orders must be challenged directly and timely in the court of appeals. If nobody does, the interpretation stands.
According to the dissent, the majority fumbled a matter of basic statutory interpretation. “The text of the Hobbs Act makes clear that litigants who have declined to seek pre-enforcement judicial review may not contest the statutory validity of agency action in later district-court enforcement proceedings.” Id. at *14. The dissent views the majority as sidestepping the Hobbs Act’s natural meaning by inventing a brand-new “default rule”—one that says Congress must use specific words or build in redundancy to bar future challenges. In doing so, the majority effectively guts the Hobbs Act and jeopardizes the predictability and effectiveness of administrative enforcement.
The Hobbs Act gives federal courts of appeals the exclusive power to review and invalidate certain agency rules and orders. The core question is whether that exclusivity bars someone from later challenging an agency’s action in a district court enforcement case, long after the action was issued and reviewed. The dissent argues this question is answered by the text of the statute.
“[T]he Hobbs Act gives courts of appeals exclusive authority to ‘determine the validity’ of specified agency actions. ‘Exclusive,’ of course, means courts of appeals alone, not district courts.”

Id. at *14. Thus, if a district court rejects an agency order, the district court is doing what the Hobbs Act expressly forbids: “determin[ing] the validity” of that rule. This undermines the Act’s exclusive-review structure and allows litigants to sidestep Congress’ clear division of judicial power.
The dissent further criticizes the majority’s interpretation of “determine the validity” to mean “issue a declaratory judgment determining the validity.” Nothing in the Hobbs Act limits the term to the majority’s narrow interpretation and Congress is more than capable of saying so if that’s what it intended. The majority has essentially rewritten the statue by adding language Congress didn’t intend to include.
According to the dissent, history, precedent, and common sense all point to one conclusion: the Hobbs Act was meant to prevent exactly the kind of late-stage challenge to agency orders the majority now allows. The dissent cites a century’s worth of case law – Venner, Yakus, Port of Boston, etc…—to show that when Congress gives appellate courts “exclusive jurisdiction” to determine the validity of agency action, that language precludes district courts from challenging those orders later on. Congress legislated against the backdrop of these decisions, and the Supreme Court’s past interpretations have consistently upheld the exclusivity of appellate review.
The dissent argues that the “default rule,” requires Congress to take a “belt and suspenders” approach—adding a redundant “we mean it too” sentence—whenever it intends for an exclusive jurisdiction provision to vest review solely in the courts of appeals. The majority offers two reasons for this approach: (1) the presumption of judicial review of agency action and (2) the Administrative Procedure Act (“APA”). The dissent challenges both.
Presumption of Judicial Review of Agency Action
The dissent agrees that there is a basic presumption of judicial review for agency actions, however, it argues that the presumption isn’t as radical as the majority claims. Congress often channels judicial review into a specific forum without eliminating it entirely. Citing past cases like Thunder Basin and Axon, the dissent argues that when Congress provides an exclusive structure for judicial review, the presumption of district court review doesn’t apply. Here, because the Hobbs Act offers a centralized appellate review structure, the default presumption of district court review should not be triggered.
Administrative Procedure Act
Further, the dissent argues that the APA, specifically Section 703, does not support the majority’s “default rule.” It emphasizes that Section 703 explicitly carves out an exception when Congress provides a “prior, adequate, and exclusive” path for judicial review—precisely what the Hobbs Act does. Thus, district courts must determine in each case whether Congress had the intent to preclude or permit judicial review of agency action in enforcement proceedings, and not defer to a “default rule.” In essence, the APA calls for statutory interpretation, not its avoidance as the majority does by deferring to a “default rule.”
Consequences of the Majority’s Misreading of the Hobbs Act (According to the Dissent)
The majority’s misreading of the Hobbs Act undermines its core purpose: to ensure finality and prevent disruptive, belated challenges to agency action. By allowing parties to contest agency decisions without first notifying the government, the ruling threatens the stability of administrative frameworks and invites legal uncertainty. It may also discourage prompt compliance with lawful regulations, even in areas where Congress prioritized immediate enforcement.
The Court’s ruling undermines the Hobbs Act’s which relies on a strict 60-day window to bring challenges to agency actions. After the 60 days are up, those interested are meant to have clear rules to be guided by. But by allowing future challenges, the majority opens the floodgates of indefinite disruption, threatening stability with nothing being ever truly settled.
Further, this decision strips the government of its right to defend agency orders. Normally, challengers must sue the United States and notify both the agency and the Attorney General, ensuring the government has a chance to respond. Now, however, district courts may invalidate agency orders in private suits. As a result, agency decisions can be reversed without the FCC or other agencies having any opportunity to object.
Finally, Congress deliberately structured the Hobbs Act to prevent regulated entities from treating compliance with agency orders as options, and gambling on a more favorable outcome in the future. The Hobbs Act ensures compliance by requiring early judicial review, not post hoc challenges.
“The Hobbs Act gives the courts of appeals “exclusive jurisdiction” to “determine the validity” of covered agency action. Those words mean what they say, or anyway should. They mean that, because the appellate courts’ jurisdiction is exclusive, district courts have no power to make the determination anew.”

Id. at *20. The majority has effectively gutted the framework of the Hobbs Act and gave regulated actors too much leeway to disregard agency orders.

The Hidden Risk Factor: Vendor Contracts in the Cyber Insurance Era

In today’s digital world, data breaches due to vendor failures are becoming increasingly common, often resulting in costly fallout. While insurance can provide a safety net, the interaction between cyber insurance and vendor contracts is crucial for effective recovery and risk management. Vendor contracts should not be treated as mere formalities but as vital frameworks that contain specific, detailed provisions regarding data security obligations to ensure accountability and minimize vulnerabilities.
Attempts to recoup costs from vendors following cybersecurity events increasingly underscore the critical importance of detailed contracts that clearly define cybersecurity obligations and responsibilities. This issue is also becoming a focal point during cyber insurance policy renewals. Weak subrogation cases, where insurers have covered policyholders for incidents caused by vendors but later struggle to recover those costs, have prompted insurers to adopt more aggressive underwriting practices and heightened scrutiny during renewals. Insurers are now asking about contracts between policyholders and their third-party vendors as part of the underwriting process, making inquiries to assess potential exposure. Consequently, policyholders must prioritize precise and enforceable contractual provisions with vendors—not only to enhance their chances of recovering costs after an incident but also to facilitate smoother cyber insurance renewals and potentially secure more favorable policy terms.
The Blackbaud 2020 ransomware incident illustrates the significant challenges policyholders may face in cyber incident disputes when vendor contracts are vague or poorly defined, limitations that can severely restrict recovery options and hinder efforts to recoup losses. In this case, several nonprofit and higher education organizations insured by Travelers and Philadelphia Indemnity incurred substantial costs related to investigating and mitigating the incident. While the insurers initially covered these expenses, they later filed lawsuits against Blackbaud to recover the amounts paid, alleging breach of contract and negligence in an effort to recover their payments.
However, in Travelers Casualty and Surety Co. of America v. Blackbaud Inc., C.A. No. N22C-12-130 KMM and Philadelphia Indemnity Insurance Co. v. Blackbaud Inc., C.A. No. N22C-12-141 KMM, the insurers were ultimately unable to recover from Blackbaud. The court dismissed their claims, finding that the insurers failed to provide sufficient factual detail to support allegations of breach of contract or negligence. Specifically, the court noted that the insurers did not clearly identify the contractual provisions within the vendor contracts that would establish a direct link between the ransomware incident and Blackbaud’s obligation to indemnify the policyholders for their incurred costs.
To prevent these risks, policyholders should focus on enhancing recovery by considering the following proactive measures:

Contract Review: Include specific, enforceable cybersecurity standards in vendor contracts.
Indemnity Provisions: Ensure vendor contracts require the vendor to cover costs incurred by the company related to the breach.
Breach Notification: The vendor contracts should contain clear timelines, cooperation clauses, and audit rights as it pertains to notifying a breach.
Cyber Insurance Alignment: Consult with an insurance professional to understand coverage obligations under cyber insurance policy and vendor agreements to confirm there are no gaps in coverage or ambiguous language as to what is covered.

It is equally important for policyholders to understand the measures to take after a breach. Following a breach, policyholders must take decisive action to support insurance claims and facilitate recovery from vendors. This involves meticulously documenting all aspects of the incident, including keeping detailed records of:

Incident Response Steps: record the action taken as a result of the breach, including the timing for such response.
Third-Party Communications: maintain comprehensive logs of all interactions with vendors and third parties involved in the breach.
Costs Incurred: compile detailed records for all expenses related to legal fees, IT services, forensic analysis, notification processes, and credit monitoring efforts to maximize recovery.

Cyber risk is a shared responsibility between cyber policies and vendor or third-party contracts. However, the legal system may not always hold third parties accountable. Thus, policyholders should not rely solely on insurance or vendors. Rather, the focus should be on proactive risk management and reactive risk management which put the insured in the best position for coverage.

Supreme Court Limits ADA Claims to Employees and Applicants, Not Retirees

In, Stanley v. City of Sanford, Florida, the U.S. Supreme Court clarified the scope of the Americans with Disabilities Act, holding that Title I’s employment discrimination provisions do not apply to individuals who are retired and no longer hold or seek employment. The decision, a 7-2 majority written by Justice Neil Gorsuch, gives employers a clear win concerning retirees and the ADA, specifically that a retiree who is not holding or seeking employment is not a qualified individual under the ADA and therefore cannot bring a successful suit under that statute.
The Facts
Karyn Stanley, a former firefighter for the City of Sanford, Florida, was forced to retire in 2018 due to a disability. Under the city’s revised 2003 policy, employees who retired due to disability received only 24 months of health insurance, compared to those employees who retired with 25 years of service who received coverage until age 65. Stanley sued under the ADA, alleging the policy discriminated based on her disability.
Importantly, Stanley filed suit in 2020, about two years into her retirement and a few months before her benefits were about to be terminated. The outcome of the case may have been different if she brought suit while she was still employed.
The Ruling: Clear Textual Limits on Title I of the ADA
The decision affirmed the Eleventh Circuit’s dismissal of the claim, holding that Title I of the ADA protects only “qualified individuals”—those who hold or desire a job and can perform its essential functions. The court emphasized Congress’s use of present-tense language—“holds or desires” a position—and the statutory requirement that the person be able to “perform the essential functions” of the job with or without reasonable accommodation at the time the person allegedly suffers discrimination. This definition does not apply to individuals who have already exited the workforce and are not seeking re-employment at the time the individual suffers discrimination.
The court dismissed arguments that retirees are nonetheless covered because they once held a job. “The statute protects people, not benefits, from discrimination,” Gorsuch wrote, reinforcing the view that Title I is designed to prevent workplace discrimination against qualified individuals—not to govern post-employment benefits for retirees.
Why It Matters for Employers
The ruling reinforces that the ADA’s employment protections are not unlimited. To be able to assert an ADA claim, an employee or applicant must be able to perform the essential functions of the position held or desired. Retirees who are not working cannot, by definition, meet that threshold ADA requirement. Furthermore, the timing of Sanford’s suit – after she had already retired – ultimately doomed her ADA case when viewed in light of the ADA’s plain language.
The court was careful to note that its decision does not preclude other legal avenues, such as claims under the Rehabilitation Act, state law, or constitutional equal protection claims. But critically, ADA Title I cannot be stretched beyond its plain text to cover retirees.
Conclusion
The Stanley decision reinforces a principle many employers have long understood: that the ADA only applies to employees or applicants who are qualified, which means they can perform the essential functions of the job they hold or desire. The Supreme Court made it clear that a retiree cannot be qualified under Title I of the ADA because the retiree is not seeking to perform the essential functions of a job that he/she holds or desires. Employers still face potential ADA liability from current employees or applicants, and employers should review their job descriptions to make sure they are as accurate as possible and define the job’s essential functions to be in the best position to defend themselves against ADA claims in the future.
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BLURRY LINE: Court Suggests Gold Seller’s Calls to “Inform” About the Value of Gold Might Not Be A Solicitation Message

Interesting one here.
So a small company that apparently pitches gold as an investment to consumers was sued in a TCPA class action.
They didn’t show up in time to defend themselves and a default was entered against it.
In time, however, they got their act together and hired a lawyer who moved to set aside the default.
In assessing whether or not to lift the default the court had to determine whether the defendant had any meritorious defenses worthy of allowing it to proceed in the case.
While the defendant proffered several, one was particularly eye opening.
The Defendant argues that it has “adhered to the TCPA regulations by refraining from sending solicitation messages” and instead “provided courtesy messages to the general public, which contain informative, yet publicly available, communications related to [G]old.” Defendant maintains… the messages contained “information to individuals, enabling them to make better investment choices.” 
Hahahah what?
I have to tell you a call from a gold seller “informing” you that gold is a super awesome investment is DEFINITELY a solicitation in the eyes of most courts, even if the message doesn’t say “buy it from me right now!”
It is the intent of the message that matters and one can easily infer this message was intended to sell gold.
Still the result here isn’t too surprising, courts bend over backward to give people their day in court and that’s all that happened here I suspect.
But one to keep an eye on.
The case is Hoffman v. Reagan Gold 2025 WL 1725139 (W.D. Wash June 20, 2025).

Oregon Court of Appeals Holds That Handbooks Can Form Contracts Unless Clearly Disclaimed

The Court of Appeals of the State of Oregon recently clarified in Dailey v. University of Portland that under Oregon law, handbooks can form contracts unless there is a clear disclaimer. The court emphasized that conspicuous and unambiguous disclaimers can prevent statements in handbooks from becoming contractual statements.

Quicks Hits

In Dailey v. University of Portland, the Court of Appeals of the State of Oregon addressed the enforceability of handbook provisions as a “contract.”
Generally, Oregon law recognizes that handbook provisions can form a contract unless effectively disclaimed.
The court emphasized that employers must ensure disclaimers are clear, prominently placed.

Background
Stephen Dailey was a student in the University of Portland’s doctoral nursing program. He began the nursing program in 2015. However, in 2017, due to personal circumstances, he reduced his course load. The following year, in 2018, he took a leave of absence and did not return until three years later, at which point he reenrolled in the program. To earn his degree, Dailey was required to complete a specific sequence of academic and clinical courses within a six-year period.
According to the university’s intranet bulletin, nursing students’ clinical courses must have a supervisor with a minimum of 2,080 hours of licensed experience. For two semesters, Dailey’s clinical supervisors did not meet this requirement, as neither had the necessary licensed experience.
Dailey was ultimately unable to complete the program within the permitted six-year timeframe and withdrew. Dailey brought a breach of contracts claim against the university, arguing that disclaimers in its general student handbook, nursing school handbook, and online bulletin were ambiguous and gave rise to contractual obligations for the university to find clinical opportunities for Dailey.
The Court’s Decision
The appeals court agreed with the university that clear and conspicuous disclaimers can prevent handbook provisions from forming a contract. The court, however, found that while the general student and nursing school handbook’s disclaimers were clear and conspicuous, the university’s disclaimer on its bulletin was “tucked away in a mousehole.” To access the bulletin’s disclaimer, a reader had to click through two separate webpages without any clear indication that a disclaimer would be found there. The court noted that the university’s disclaimer was therefore effectively hidden. The court held that, as a matter of law, the disclaimer was not conspicuous enough to defeat the plaintiff’s contract claim and reversed the trial court’s grant of summary judgment.
Key Takeaways for Employers

Although the case involved a student rather than an employee, the law applies equally in the employment context.
Employers may consider placing clear and conspicuous disclaimers in their employee handbooks, personnel policies, and intranet-based policies to ensure that such documents do not inadvertently become enforceable employment contracts.

Confidentiality Agreements Applied to Nonparty Recipients

In Dale v. T-Mobile US, Inc. – a putative antitrust class action litigation – Magistrate Judge Jeffrey Cole resolved whether and to what extent confidentiality agreements between parties apply to productions nonparty recipients of subpoenas made.
Background
In this litigation, the parties entered a confidentiality order governing discovery in the case. After the parties issued subpoenas to numerous non-parties, a dispute with the non-parties arose regarding certain portions of the confidentiality order. Although the parties and the non-party subpoena recipients “nearly reached agreement [during meet and confers] for amending the Confidentiality Order,” they could not agree on certain topics, including whether defendant’s in-house counsel would be permitted to review highly confidential information from the non-parties. A motion to amend the confidentiality order was brought to the court. 
Although Judge Cole ultimately denied the motion, he provided the parties and non-parties with guideposts and encouraged all to work cooperatively toward a mutually acceptable resolution. Magistrate Judge Cole initially noted that non-parties have “vastly different expectations regarding the confidentiality of their information” and explained that “parties to a lawsuit must accept the invasive nature of discovery, non-parties are just that, not parties …, and they generally do not have anywhere near the same skin in the game.” Therefore, “a non-party is entitled to greater protection in the discovery process than parties….” 
Judge Cole then turned to the merits of the parties’ arguments. In rejecting defendant’s argument that the non-parties should be bound by the confidentiality order because the court was “well-aware of the nonparty discovery that Plaintiffs’ claims would entail,” the judge cited to the plain language of the confidentiality order, noting that by its terms the order applies only to “any named Party to this action … and to Non-Parties who agree to be bound by this Order.” Magistrate Judge Cole then analyzed the three factors a court must consider when the modification of a confidentiality agreement is sought (citing Heraeus Kulzer, GmbH v. Biomet, Inc.). He found the first factor, the nature of the order, favored modification “because the non-parties did not agree” to the confidentiality order. He concluded that the second factor, the foreseeability that modification would become necessary, also favored the non-parties because the parties’ agreement “left open the very real possibility that non-parties — competitors with one of the parties — would disagree with it.” Finally, he found the third factor, the parties’ reliance on the order, “is really neither here nor there” because they knew “non-parties they planned on subpoenaing would understandably balk.”
Regarding the substance of the non-parties’ objections to the confidentiality order, Magistrate Judge Cole noted that “[t]he non-parties have some very real concerns about in-house counsel for a competitor poring over their documents” and that “it is no small matter for in-house counsel to compartmentalize information learned in discovery.”
Magistrate Judge Cole urged the parties and non-parties to “take a critical look at their current positions and make another attempt to come up with something workable” and to “think creatively with an eye toward what is truly and not merely academically meaningful.” He also suggested that the parties and non-parties “put together some sort of mutually acceptable agreement rather than have something perhaps imposed on them down the road.” Ultimately, Magistrate Judge Cole denied the motion to amend the confidentiality order and ordered the parties to meet and confer “with the forgoing considerations and weaknesses in positions in mind.”
Conclusion
This decision provides a few useful reminders. First, disputes that can be resolved without imposing upon the court should seek to be resolved amicably. It also serves as a reminder that parties will be bound by the plain terms of an agreement – especially one the court orders. Finally, protections afforded to non-parties in a litigation may be greater given the different expectations of non-parties who have “no skin” in the litigation. Thought should be given to this when drafting agreements that might impact a non-party.

Navigating Uncertainty: How Recent IEEPA Tariff Rulings Impact the Maritime Industry

On May 28, 2025, the United States Court of International Trade (“CIT”) issued a landmark decision in V.O.S. Selections, Inc. v. United States,[1] holding that tariffs imposed by the President under the International Emergency Economic Powers Act (“IEEPA”) exceeded the statutory authority granted by Congress. The CIT vacated the challenged tariff orders and permanently enjoined their enforcement nationwide. However, less than 24 hours later, the U.S. Court of Appeals for the Federal Circuit temporarily stayed the CIT’s order, preserving the tariffs while the government’s appeal is pending. A separate decision from the D.C. District Court also found the President’s IEEPA tariffs to be beyond the scope of the statute, though it imposed a more limited injunction.[2]
The CIT’s decision is significant for the maritime industry, as it directly challenges the President’s ability to impose broad, unbounded tariffs on imports under IEEPA. The CIT emphasized that IEEPA does not grant the President unlimited authority to regulate importation through tariffs, and that any such delegation of power must be clearly limited and guided by statutory principles. The CIT found that the tariffs in question—ranging from a 10 percent rate on all imports to higher, country-specific duties—were not sufficiently tied to the “unusual and extraordinary threat” required by IEEPA and lacked meaningful limitations in scope or duration.
Immediate Impact on the Maritime Industry
Although the CIT’s decision would have set aside all tariffs imposed under the challenged executive orders, the Federal Circuit’s stay means that these tariffs remain in effect for now. This ongoing legal uncertainty has several immediate implications for the maritime industry:

Continued Tariff Collection. Maritime carriers, freight forwarders, and port operators must continue to process shipments subject to the existing tariffs, as the stay preserves the status quo pending further judicial review.
Operational Uncertainty. The potential for a sudden removal or reinstatement of tariffs creates significant unpredictability for shipping schedules, contract negotiations, and supply chain planning. Maritime stakeholders should be prepared for rapid changes in tariff policy as the litigation progresses.
Customs and Compliance Considerations. Importers and logistics providers must remain vigilant in tracking the status of the litigation and any changes to tariff enforcement. Accurate documentation and compliance with current tariff requirements remain essential to avoid penalties or delays.

Long-Term Implications for Maritime Trade
The CIT’s decision, if upheld, would have far-reaching consequences for the maritime industry:

Potential Elimination of Additional Duties. If the tariffs are vacated, importers would no longer be subject to the additional duties imposed under the challenged executive orders. This could lead to increased cargo volumes and reduced costs for shippers and their customers.
Judicial Scrutiny of Emergency Tariffs. The decision signals that future attempts to use IEEPA to impose broad tariffs—especially as leverage in trade negotiations or to address general trade deficits—will face significant judicial scrutiny. This may provide greater predictability and stability for maritime trade policy going forward.
Distinction from Section 232 Tariffs. It is important to note that the CIT’s decision does not affect tariffs imposed under other authorities, such as Section 232 duties on steel, aluminum, and automobiles. These measures remain in place and continue to impact certain segments of the maritime industry.

Next Steps and Recommendations
Given the dynamic nature of the current legal landscape, maritime stakeholders should vigilantly monitor ongoing litigation developments and be ready to adapt their operations in response to changes in tariff policies. It is advisable to consult with legal counsel regarding the status of duties paid under the relevant tariffs and potential refund procedures if these tariffs are ultimately overturned. Maintaining robust compliance programs is essential to ensure adherence to all applicable customs and tariff requirements during this period of uncertainty.
Recent court rulings emphasize the importance of statutory limits on presidential authority to impose tariffs, highlighting the need for maritime industry stakeholders to stay informed and agile as the situation evolves.

[1] cit.uscourts.gov/sites/cit/files/25-66.pdf

[2] courthousenews.com/wp-content/uploads/2025/05/contreras-blocks-certain-trump-tariffs.pdf

What a Cargo of Wheat Can Teach Us About Jurisdiction, Justice, and the Art of Drafting Contracts

In the pantheon of arbitration appeals, achieving success under sections 67, 68, and 69 of the Arbitration Act 1996 in a single case is rather like scoring a hat trick in a World Cup final – theoretically possible but rarely achieved. Yet this is precisely what CAFI Commodity & Freight Integrators DMCC (CAFI) managed in its recent victory against GTCS Trading DMCC (GTCS).
The decision in CAFI v. GTCS Trading, EWHC 1350 (Comm) (2025) offers a masterclass in how arbitration can go spectacularly wrong when tribunals tie themselves in jurisdictional knots, and how the Commercial Court can untangle even the most byzantine of procedural tangles. More importantly for commercial parties, it provides welcome clarity on when disputes can span multiple contracts – and why arbitrators cannot simply blind themselves to inconvenient contractual provisions.
A Tale of Two Contracts (and Some Sanctions)
As so many modern commercial disputes do, our story begins with the inconvenient incursion of geopolitics upon the noble pursuit of profit.
GTCS agreed to sell CAFI 28,000 metric tonnes of Russian milling wheat at a rate of $465 per tonne under a contract concluded in March 2022. The timing, one might observe, was not ideal. With US sanctions against Russia creating payment difficulties, CAFI found itself in the uncomfortable position of wanting wheat it could not easily pay for.
What followed was a commercial pas de deux familiar to anyone who has ever tried to salvage a deal going sideways. Through the intervention of a broker, the parties negotiated a second contract for the same cargo at a reduced price of $440 per metric tonne. Crucially, this second contract contained what the court termed a “Termination Clause” stating that the first contract was “terminated and considered void.” The cargo was duly delivered and paid for under the second contract.
One might have thought this the end of the matter – a neat commercial solution to an awkward geopolitical problem.
One would have been wrong.
The Arbitration Imbroglio
GTCS, perhaps suffering from seller’s remorse over the $25 per tonne price reduction, commenced Grain and Feed Trade Association (GAFTA) arbitration claiming damages for CAFI’s alleged repudiatory breach of the first contract.
GTCS’s argument was simple: CAFI had breached the first contract, and the fact that CAFI had subsequently agreed to buy the same cargo at a lower price merely quantified the damages. CAFI’s response was equally straightforward: the second contract’s Termination Clause had rendered the first contract “void” and thereby extinguished any liability for damages. This presented the GAFTA tribunal with a mealy interpretive puzzle – what exactly did “terminated and considered void” mean?
The First-Tier Tribunal sided with CAFI, finding that GTCS had waived its right to claim damages. GTCS appealed to the GAFTA Board of Appeal, which is where our journey takes a turn.
The Appeal Board found itself faced with what it perceived as a jurisdictional conundrum. Having been appointed under the arbitration clause in the first contract, could it interpret provisions of the second contract? The board concluded it could not: the second contract had its own arbitration clause, and any disputes about its meaning would require a separate arbitration. No arbitration had been commenced under the second contract, and so neither the First-Tier Tribunal nor the board had “jurisdiction to interpret the terms of the [second contract] or how any of those terms impact on the [first] Contract.”[1]
Having reached this conclusion, the board then proceeded to do exactly what logic suggested it could not: it awarded GTCS damages of $700,000, in effect determining that the Termination Clause did not extinguish liability under the first contract. The board’s reasoning was that while it could not interpret the second contract as a contract, it could consider it as “evidence” of what happened after the first contract was terminated.
This approach created a raft of failings.
The Court’s Triple Victory
CAFI challenged the board’s award. Its challenge succeeded on all fronts, providing a neat demonstration of how the three appeal grounds under the Arbitration Act can work in practice.
Section 67 (jurisdiction): The court held that the Appeal Board was wrong to conclude it lacked jurisdiction to interpret the second contract as a contract.[2] The arbitration clause in the first contract was decidedly vanilla, covering “[a]ny dispute arising out of or under this contract.” That language was broad enough to encompass disputes about whether subsequent agreements affected rights under the first contract. As Henshaw J noted, rational parties would not intend that disputes about the continuing validity of their contract should be carved out and sent to a different tribunal.[3]
Worse still, having found (wrongly) that it lacked jurisdiction to interpret the second contract, the board then went on to exceed the jurisdiction it thought it did have. It followed from the board’s finding that it lacked jurisdiction in respect of the second contract that it also lacked jurisdiction to determine the question of waiver. But by awarding damages without determining whether the Termination Clause extinguished GTCS’s right to claim them, the board made an implicit determination as to the effect of the second contract, and, by purporting to do so, exceeded its jurisdiction.
Section 68 (serious procedural irregularity): The board’s failure to properly grapple with the waiver issue created other problems too. The court found that even if the board’s finding as to jurisdiction was correct, it was not possible to determine whether CAFI was liable under the first contract without first determining whether GTCS had, through the second contract, waived its claims. By finding CAFI liable for breach without considering the waiver issue, the board, in dereliction of duty under section 33, pre-emptively determined the waiver issue against CAFI – an irregularity so serious it was within the scope of section 68.
Section 69 (error of law): Cementing the hat trick, the court also found that the board, by concluding it could award damages where a live issue existed as to whether liability had been extinguished and that issue had not been resolved by a competent tribunal, had committed an obvious error of law.
Additionally, although ultimately unnecessary for the court to determine,[4] Henshaw J noted that CAFI would have had “a strong case” that the Appeal Board’s conclusion that CAFI needed to show the Termination Clause had been “freely negotiated” or was the subject of “clear discussion” before it could be effective was obviously wrong in law.[5] That dicta confirms that the terms of a written contract speak for themselves, regardless of the process by which they came to be agreed—that a contract means what it says, not what the parties discussed (or failed to discuss) beforehand, and courts and tribunals should not journey beyond the words used in a hunt for evidence of specific negotiation of particular clauses.
Lessons From the Wheat Wars
From forum selection strategies to drafting precision, the case highlights opportunities and pitfalls, and offers kernels of wisdom for commercial practitioners navigating the complexities of multi-contract disputes.
When arbitrators fear to tread: For all its virtues, arbitration is only as good as the arbitrators who conduct it. When tribunals tie themselves in jurisdictional knots and attempt to avoid difficult interpretive questions, they risk creating the very problems they seek to avoid. The Appeal Board’s attempt to split the difference, denying jurisdiction over the second contract and disclaiming ability to discern its meaning while effectively doing exactly that sub silentio, satisfied nobody – and achieved nothing except procedural chaos. Jurisdictional questions demand confidence, not excessive handwringing.
A commercial victory: Commercial parties need not launch multiple arbitrations when subsequent agreements might affect rights under earlier contracts. A single, properly appointed tribunal can – and should – interpret one contract through the lens of later agreements between the same parties. This streamlined approach saves both time and the headache of coordinating parallel proceedings.
Forum shopping made simple: Jurisdiction clauses are not always mutually exclusive.[6] When parties weave together related agreements, each sporting its own arbitration clause, disputes can legitimately fall within multiple jurisdictional nets. The result? Claimants likely get to pick their preferred forum, but they should do so with caution given the attendant risk of parallel proceedings.
The price of poor drafting: Beyond the jurisdictional confusion lies a sobering lesson in the need for clear contractual drafting. The phrase “terminated and considered void” may have seemed like belt-and-braces language to the parties, but it created sufficient ambiguity to spawn two arbitrations, an arbitration appeal, and a Commercial Court appeal. Greater drafting precision might have saved everyone considerable time and expense.
The case provides an exposition of arbitration law in action, and a reminder that even in the esoteric world of GAFTA wheat disputes, basic principles of fairness and logical consistency still matter. The Commercial Court’s willingness to deploy all three statutory appeal grounds demonstrates that when arbitrators get it wrong, they can get it comprehensively wrong—and that the courts retain both the power and the will to put things right.

[1] Section 9.8, extracted in section 28 of the judgment.
[2] Section 43.
[3] Section 38, section 42.
[4] The Appeal Board did not attempt to construe the second contract as a contract and accordingly it was unnecessary to determine CAFI’s alternative challenge (advanced on the basis of section 69) that the board’s approach to interpretation was an obvious error of law.
[5] Section 62.
[6] Section 36.

When Arbitration Secrets Cross Continental Divides: The Commercial Court’s Latest Take on Confidentiality

In the world of arbitration, where the same cast of characters regularly appears on different stages, the question of who knows what – and who can tell whom – has always been deliciously complex. The Commercial Court’s recent decision in A Corporation v. Firm B and another, EWHC 1092 (Comm) (2025) serves up a masterclass in navigating these treacherous waters, with Mr Justice Foxton at the helm delivering a judgment that manages to be both pragmatic and principled.
Two Vessels and Too Many Lawyers
Picture this: A law firm, Firm B, with offices spanning continents, finds itself in the middle of a confidentiality conundrum. The London office had acted for B Corporation in a dispute about Vessel 1, which settled nicely. The firm’s Asia office was representing C Corporation in a separate arbitration about Vessel 2. The plot thickens when we learn that the opposing parties in these arbitrations – A Corporation and D Corporation, respectively – are corporate siblings, having a common beneficial owner.
A Corporation, sensing danger, sought injunctions faster than you can say “information barrier.” A’s concern? That confidential nuggets from the Vessel 1 arbitration might find their way into the Vessel 2 proceedings, giving C Corporation an unfair advantage. It wanted Firm B out of the Vessel 2 arbitration entirely, demanding a forensic “cleansing” of files and sworn affidavits about what information had already crossed the Pacific.
But the current of riches was not to be, and the tide returned only hollow crates.
The Sliding Scale of Secrets
What makes Foxton J’s judgment particularly enlightening is his articulation of what might be called the “sliding scale of arbitral confidentiality.” Not all confidential information, it seems, is created equal. The judgment draws careful distinctions between:

The inherently public: Facts about defective goods or contractual disputes don’t become confidential simply because someone commences arbitration. If your vessel arrives in poor condition, that unfortunate fact doesn’t transform into a secret merely because you choose to arbitrate rather than litigate.
The procedurally protected: Documents created for arbitration – pleadings, witness statements, expert reports – enjoy confidentiality not because their content is inherently secret, but because they were deployed in a private process.
The genuinely sensitive: Information disclosed by your opponent under compulsion sits at the apex of the confidentiality pyramid, deserving the highest protection.

This nuanced approach reflects the reality that arbitration confidentiality isn’t a monolithic concept but rather, as the Privy Council suggested was necessary in Associated Electric, sets buoys between different types of documents and information, some inherently more confidential or sensitive than others.[1]
The Maritime Bar’s Dilemma
Perhaps the most practical insight from the judgment concerns what Foxton J delicately terms the “experience that lawyers acquire through conducting arbitrations.” In the small world of maritime arbitration (though the same would hold true for arbitration in many other sectors) where the same solicitors and counsel regularly appear for and against the same parties, drawing the line between protected information and professional experience becomes an art form.
Inevitably, lawyers learn about their opponents’ litigation strategies, which document requests tend to yield results, how particular arbitrators approach certain issues, and what contraband might be stowed away in experts’ and witnesses’ quarters. This accumulated wisdom – the maritime lawyer’s stock-in-trade – cannot be quarantined simply because it was acquired in confidential proceedings. As Foxton J notes with admirable understatement, while the line is difficult to articulate, “experienced lawyers generally have a good sense of which side” of the line they’re on.[2]
When Geography Helps
The continental divide between Firm B’s offices proved crucial to the outcome. While Lord Millett’s famous dictum in Prince Jefri Bolkiah v. KPMG (A Firm), H.L (1998) warns that “information moves within a firm,” the physical and operational separation between London and Asia offices made the threat of disclosure less compelling. The court found no realistic possibility of further confidential information making the trans-Pacific journey, especially after the London lawyers agreed to step down from the Vessel 2 matter.
The judgment also highlights a critical distinction between “former client” cases (where firms face a heavy burden to show no risk of disclosure) and “no relationship” cases like this one. When a firm has never acted for the party seeking the injunction, that party must prove a real risk of prejudice – a burden that A Corporation couldn’t meet.
The Settlement Slip-Up
In a moment of candour, Firm B admitted to one clear breach: passing along information about A Corporation’s settlement offers. Yet even this admission didn’t save A Corporation’s application. The information had already reached C Corporation, and given the significant differences between the two disputes, its utility was limited. Sometimes, it seems, the harbour gates are best left open after the ship has sailed.
Practical Takeaways
For practitioners navigating these waters, the judgment offers valuable guidance:

Pre-arbitration facts remain fair game: The circumstances leading to a dispute don’t become confidential merely because arbitration follows. Your opponent’s defective performance is still their defective performance.
Context matters: The court will consider the actual prejudice to all parties, including innocent clients who might lose their chosen counsel. C Corporation, having instructed Firm B’s Asia office for over a year for reasons unrelated to the Vessel 1 dispute, would have suffered real prejudice from an injunction.
Information barriers can work: But they must be robust, properly implemented, and implemented before the court gets involved. The judgment suggests that voluntary measures, properly executed, may be more effective than court-ordered arrangements.
Document your decisions: The careful approach to confidentiality taken by Mr W, the Firm B partner with conduct of the matter, despite some missteps, ultimately helped demonstrate that Firm B took its obligations seriously. When navigating confidentiality’s narrow straits, it helps to keep a clear logbook.

Charting the Wider Seas
This decision fits within a broader trend of English courts taking a pragmatic approach to arbitral confidentiality. Rather than treating it as an absolute principle, the courts recognise that commercial reality demands flexibility. The “sliding scale” approach allows the system to protect genuinely sensitive information while avoiding outcomes that would paralyse the relatively small community of specialist practitioners.
For international firms with offices spanning continents, the message is reassuring. Geographic separation, combined with sensible information barriers and professional conduct, can allow different offices to act in related matters without falling foul of confidentiality obligations.
The judgment stands as a testament to the Commercial Court’s ability to deliver principled yet practical justice – even when that means telling an applicant that their fears of confidentiality breaches, while understandable, don’t justify the nuclear option of disqualifying opposing counsel.
As disputes continue to proliferate and law firms continue to globalise, the delicate balance struck in A Corporation v. Firm B provides a workable framework for managing the inevitable conflicts. It’s a reminder that in the world of arbitration, as in navigation, the key to avoiding hazards is to chart a careful course between them, and that in arbitration, as in life, the best secrets might be those that aren’t really secrets at all.
[1] Section 12, referring to Associated Electric and Gas Insurance Services Ltd v. European Reinsurance Co of Zurich UKPC 11 (2003), at section 20.
[2] Section 26.

STRAIGHTFORWARD: BPO Firstsource Solutions Trapped in TCPA Class Action As Court Denies Effort to Dismiss

TCPA cases are dangerous and difficult to defend. Everyone knows that.
But sometimes results are predictable and simple.
For instance in Barry v. Firstsource Solutions, the Plaintiff alleged BPO Firstsource made a series of illegal prerecorded calls without consent.
Firstsource moved to dismiss arguing the Complaint did not allege facts showing it actually made the calls or that the calls were prerecorded.
The Court responded with the judicial equivalent of an eyeroll.
As to “who made the call” the Complaint alleges that the calls’ speaker self-identified as calling from Firstsource and that the voice message directed the recipient to Firstsource’swebsite. That what plenty good enough for the court.
As to whether the calls were prerecorded in nature, the allegations were “the calls seemed to be artificial or prerecorded in nature because the tone and intonation of the caller were unnatural and did not reflect live speech” plus “Oliver’s name was said in a distinct manner that sounded different than the rest of the prerecorded message.” Again the Court said this was fine– a “higher” standard of pleading than necessary.
Full order here: Barry v. First Source
So one take away here, I suppose, is not to waste money on motions that can’t possibly win I think the bigger takeaway is how easy it is for a BPO to end up trapped in a very serious class action. BPO’s generally call only for brands and at their specific instructions, but as the maker of the call they can be directly sued.