Global Private Equity Newsletter - Winter 2019 Edition: U.S. Carve-Out Transactions: A Fertile Ground for Private Equity Firms

Dechert LLP
Contact

Dechert LLP

Driven by the influence of shareholders, activists and competitive market forces, public companies are demonstrating renewed focus on their core businesses. Reductions in the U.S. corporate tax rate from 35% to 21% have further sharpened this focus by reducing the tax burden of large asset sales. As a result, carve-out transactions will likely become a fertile ground for PE firms to target opportunistic and unsolicited offers for orphaned business units during 2019.

According to PE market research publications, the percentage of U.S. carve-out transactions being conducted by buyout firms is rising, and acquisitions of carve-outs by strategic acquirers is falling. As industries consolidate and companies seek to focus on core assets, strategic entities become more likely to streamline their own businesses through carve-out sales and less likely to become buyers in carve-out transactions of ancillary businesses. 

Generally, a carve-out transaction consists of the acquisition or divestiture of part of a business, operating unit or product line. Unlike acquisitions of standalone businesses, acquisitions of carve-outs tend to be more complex and require significant pre-transaction preparation, organization and attention to detail. Carve-out transactions create a greater opportunity for PE buyers through lower premiums and higher returns. However, the complexity of such transactions can result in a higher threshold for success than typical mergers and acquisitions and therefore require careful planning. 

Below are some considerations for PE firms to ponder when tackling the inherent challenges faced in carve-out transactions:

Timing and Resources

The purchase and sale of a portion of a larger business enterprise presents special contractual and structuring issues. In particular, a carve-out transaction requires significantly more due diligence, attention to detail and focused coordination among due diligence providers, legal and other advisors, and buyer personnel than an ordinary acquisition. Timing may be accelerated when the target is suffering from financial difficulties or the transaction is a competitive auction. As a result, potential buyers may be expected to complete the carve-out transaction on an expedited basis and will need to marshal the necessary resources to conclude the transaction on the articulated expedited timeframe.

Structuring the Transaction; Tax Considerations

The initial question to be addressed in connection with the contemplated transaction will be determining how to structure the transaction. Given the carve-out nature of the transaction, the sale will likely be structured through either:

(i) the creation of a newco subsidiary, the dropdown of selective assets and liabilities of the parent into the newco subsidiary and the sale of the stock of the newco subsidiary to buyer; or

(ii) the direct sale of selective assets to, and the assumption of certain liabilities by, a newly created subsidiary of buyer.

In the case of a carve-out transaction structured as an asset sale, the buyer should expect to form one or more subsidiaries to provide insulation from potential unknown contingent liabilities. In either case, the nature of the transaction will need to be analyzed and reviewed based on its inherent facts. Some of the structuring considerations include evaluating tax consequences and employment implications, determining accounting treatment and assessing whether approvals or third party consents will be required. Much of the tax planning for carve-out transactions will likely overlap with tax considerations applicable to general sales of businesses. However, the particular circumstances of the carve-out transaction may raise significant novel issues that should be addressed by sophisticated tax advisors. 

Purchase Price Considerations

Pricing the transaction will present unique challenges to the PE firm. Unlike an acquisition of a standalone business, the cash flows (e.g., EBITDA) will require significant adjustments to calculate performance on a standalone basis. The likely unavailability of audited financial statements will increase the complexity of calculating the purchase price, and arranging third party financing. Allocated overhead and other historical charges provided by the seller will often not be the best indicator of operating the target business on a standalone basis. 

Regardless of the amount and type of purchase price to be paid (cash at closing, seller financing, deferred purchase price, etc.), the PE firm should expect the business to be delivered with a normalized level of inventory or other working capital assets, which would be sufficient to operate the business in the ordinary course consistent with past practice and contemplated growth. Often overlooked by strategic sellers of carve-out businesses, the purchase agreement should include a customary inventory/working capital adjustment by comparing actual closing amounts to a mutually agreed upon target. Purchase price adjustments in carve-out transactions can be extremely complicated and require significant input from accounting professionals and attorneys experienced in carve-out sale transactions. 

Identification of Assets

A critical first step is for the buyer to understand what assets, rights and liabilities will be included in the transaction. In addition, shared assets and services that will be provided under transition services agreements will need to be identified during early due diligence. Identification requires a great deal of coordination and communication among buyer personnel, management to be transferred with the business, the drafters of the definitive agreement and the due diligence providers. Often, these important categories have been identified by the seller through interaction and “negotiations” among members of its own management. Seller management remaining with the business often attempt to dictate transaction terms to those employees being transferred to the carve-out business. Buyers should be involved early in the process and actively participate in these discussions (and direct discussions with transferree management) to correctly identify necessary assets and rights and which liabilities should be assumed.

The assets involved in carve-out transactions are generally non-core. As a result, the assets are often neglected and under maintained and managed. Operational reviews will often be required – including the need for reviews by internal PE operational teams, if any, and outside consultants.

Although PE buyers should obtain representations and warranties that all of the assets and rights needed to operate the business are being acquired, one should not rely solely on such representations and warranties. Buyers should perform business, accounting and legal due diligence to independently confirm these expectations. Also, the likely lack of available audited financial statements for the carve-out business may make contractual identification of the assets to be conveyed even more difficult. These requirements create an increased due diligence burden. 

The acquired assets will need to be identified (either generally or specifically) in the definitive agreement. There are several methods to do this – the most favorable from a buyer perspective is to first generally describe the categories of assets being acquired and then further specifically list those assets that are important and can be identified, as well as those that should be excluded. This approach provides comfort on the general inclusiveness of what is being acquired, while allowing the agreement to correlate directly with the assets identified in due diligence. Obviously, the failure to acquire the necessary assets will result in an indirect purchase price increase (at best) or the inability to operate the acquired business as expected (at worse).

Identification of Liabilities to be Assumed

In many cases, a carve-out transaction will be conducted on an "our watch, your watch" liability basis. Regardless of how the transaction is structured, buyers will need to identify liabilities to be assumed with specificity. It will be important that the boundaries of these liabilities be appropriately identified in due diligence and the definitive agreement. In a carve-out transaction, subject to certain exceptions, the buyer will generally only become liable for those assets or business either dropped down into the newco subsidiary or directly assumed by the buyer. The buyer’s goal in this context should be to assume only certain mutually agreed upon enumerated liabilities – and not general categories of liabilities. This is particularly important when the acquired business will not have audited financial statements. For example, in the context of a manufacturing or retail businesses, parties must agree upon the allocation of liability (product liability and warranty) for inventory (i) being purchased by the buyer at closing and (ii) previously distributed by the sellers. These types of allocation may have a significant effect upon the ultimate success of the investment.

Transition Services Agreement ("TSA")

There will almost certainly be a need to provide services between seller and buyer after closing. These arrangements are typically provided on a transitional basis after closing. The failure to identify and provide for such services prior to the consummation of the transaction will adversely affect the profitability and viability of the acquired business. Similar to the due diligence conducted to identify necessary assets, a significant amount of coordination is required among buyer personnel, due diligence providers and those drafting the TSA and other definitive documentation. In addition to identifying the nature of these shared services, the terms of the transitional relationship (type of services, performance standard, time period, cost, etc.) will need to be negotiated and documented.

  • Types of ServicesTypical shares services include: 
    • Accounting resources;
    • Access to confidential information and data;
    • Maintenance of product and customer data;
    • IT services including hardware and software;
    • Right to use names – brands, private labels, etc.;
    • Shared facilities;
    • Purchasing;
    • Customer matters;
    • Telephone services;
    • Payroll;
    • Human resources;
    • Benefits administration; and
    • Facility management
  • Fees - Often conflicts arise as to the fees applicable to TSA services. Buyers should seek to agree upon the cost and scope of such processes early in the process. Particular attention should be given to how such costs relate to historical costs used for valuation purposes, and likely costs after expiration of such TSA services. Allocated costs charged may not be best indicator of future operating costs.
  • Duration - Sellers are generally not in the business of providing transition services and will want to exit the TSA arrangement as soon as possible. The parties should set realistic service durations on a service-by-service basis. Buyers often are overly optimistic how quickly they can replace the transition services. Buyers should build cushions for continuance of service if uncertainties arise. Consider incentives for both buyer and seller to allow for flexibility for uncertainties, including discounts for exiting services earlier or penalties for extending services. Buyers must also have a well-developed plan for replacing such TSA services after the terms of such services (and any extensions) expire.
  • Standards of performance - Standards for performance of the TSA services should be articulated in the agreement. Services typically should be consistent with historical performance levels (i.e., those sufficient to operate the business).
  • Other Factors - Other factors to consider include: how to govern disputes, timing and method of payments, and limits on liability for failure to perform. 

Representation of Warranties

Representations and warranties in a carve-out transaction are similar to other acquisitions except that the focus is often on acquired assets and assumed liabilities. Three critical representations and warranties in this context are as follows:

  • Financial Information - Often, the divested business will not consist of a fully intact entity. As a result, there are rarely standalone financials much less audited financial statements for the carve-out business. However, buyers should seek appropriate representations and warranties relating to carve-out financials for the acquired business. It will be important to be creative in fashioning some level of representation and warranty coverage for historical operating results.
  • Sufficiency and condition of acquired assets and rights - As noted above, it is important to obtain representations and warranties that the acquired assets and rights (including intellectual property) will consist of all assets and rights necessary to operate the acquired business, except to the extent specifically identified by the seller. Buyers should expect to receive transitional services or licenses for any such excluded assets or rights identified by seller.
  • Employee benefits and employee matters - Sellers will likely expect the buyer to offer employment to all employees located at the transferred facilities or otherwise serving the carve-out business (on terms and conditions no less favorable in the aggregate that the current terms and conditions on which such employees are employed by seller), and adopt and agree to be bound by the collective bargaining agreements (if any) applicable to such employees. As a result, it is important that the representations and warranties provide the buyer with a comprehensive understanding of the nature of the terms of such benefits and agreements.


Other Matters

Employees 

Buyers will want to specifically identify which employees are necessary or desirable to operate the business after closing, and will need to hire such employees after closing. Sellers will often “cherry pick” talent and include poor performers (or unavailable workers) in the business to be transferred. Look for employees new to the unit, and employees on leave. Significant care should be taken in identifying employees to be transferred. As noted above, sellers will likely expect the buyer to offer employment to all business employees (on no less favorable terms and conditions). As a result, historical employee censuses, pre-closing employee benefits provided to such employees (including benefit plans) and requirements under union agreements should be analyzed.

Intellectual Property

Carve-out transactions often involve the acquisition of businesses that depend on intellectual property rights shared among the carve-out business and businesses to be retained by the seller. This intellectual property will need to be identified and the parties will need to arrange for cross-licensing arrangements and potentially intellectual property transfers. Often the chosen approach will depend on the nature of such intellectual property and the relative importance to the retained and transferred businesses. Buyer should expect that these arrangements will be subject to passionate negotiations between buyer and seller. The buyer should also consider the scope of any such licenses in respect of any planned changes to the carve-out business. In addition, careful consideration should be given to ownership and license of intellectual property rights in the context of positioning of the business for resale.

Modification of Certain Assumed Contracts

The buyer will need to identity whether modification of the existing terms of any material customer, supplier or other agreements to be assumed are required or desirable. Generally, bargaining power may make it easier for sellers to obtain such modifications/concessions prior to closing than it is for the buyer after closing. Also, some contracts may not be assignable and will require some creativity in giving buyer the benefits and burdens of such contracts after closing.

FTC or DOJ Required Divestitures to Resolve Antitrust Issues

Acquisitions of carve-outs sometimes arise in connection with the buyer in a combination transaction entering into a consent agreement with the Federal Trade Commission (“FTC”) or the Department of Justice (“DOJ”) requiring it to divest certain assets or business operations to resolve anticompetitive issues identified during an investigation of the combination transaction. These types of transactions are guided by considerations somewhat different than normal carve-out transactions such as:

  • Covenants not to compete It is customary for a buyer in sale transactions to obtain covenants not to compete from the seller. In the context of an FTC or DOJ consent agreement requiring a divestiture, such covenants would be prohibited since the purpose of the divestiture is to maintain the premerger level of competition between the merging firms. 
  • Expedited Basis - Because FTC or DOJ approval of the buyer of the divestiture package may be necessary before the parties to the combination transaction are cleared to complete their merger, the seller will look for buyers that have the ability to complete the carve-out transaction on an expedited basis. Buyers should expect that sellers will insist on a very tight timeframe to complete the “carve-out” transaction. As a result, the buyer will need to marshal the necessary resources to conclude the transaction on the articulated expedited timeframe. 
  • Exclusivity - Exclusivity is generally not provided in the context of an expedited forced disposition. Alternatively, buyers sometimes seek expense reimbursement payable by the seller if the transaction is consummated with another bidder.
  • FTC or DOJ Prior Approval - In order to obtain prior approval from the FTC or DOJ to acquire the carve-out business, the PE buyer will need to present a detailed business plan to the FTC or DOJ demonstrating that it will be able to compete effectively on a long-term basis as a standalone business after the closing. The FTC and DOJ also frequently require PE buyers to obtain prior approval before they can resell the carve-out in less than three years.
  • Closing Conditions - Other than requiring FTC or DOJ approval of the divestiture buyer and the closing of the combination transaction, required divestiture agreements, which must also be approved by the FTC or DOJ, typically contain few additional closing conditions. 
  • Forced Transactions Breakup Fee - It is possible that the carve-out transaction may not close due to the failure of the two merger parties to complete their combination transaction. Buyers may seek a break-up fee or expense reimbursement if the transaction does not close because the underlying combination subject to FTC approval does not close. 

 
*               *               *

Public companies have renewed their focus on operating their core businesses. As a result, the number of carve-out transactions being conducted by PE firms can be expected to rise. This renewed focus and the higher return potential will create an exceptional opportunity for PE firms to acquire orphaned business units. These potential opportunities, however, will need to be balanced against the higher threshold for success created by the complexity of carve-out transactions. Many PE firms have formed internal task forces that focus on particular market or industry group opportunities. The focus of these task forces should be expanded to target orphaned business operations as potential acquisition targets.

*The author would like to thank James A. Fishkin for providing assistance with the antitrust content in the article.

Written by:

Dechert LLP
Contact
more
less

Dechert LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide

JD Supra Privacy Policy

Updated: May 25, 2018:

JD Supra is a legal publishing service that connects experts and their content with broader audiences of professionals, journalists and associations.

This Privacy Policy describes how JD Supra, LLC ("JD Supra" or "we," "us," or "our") collects, uses and shares personal data collected from visitors to our website (located at www.jdsupra.com) (our "Website") who view only publicly-available content as well as subscribers to our services (such as our email digests or author tools)(our "Services"). By using our Website and registering for one of our Services, you are agreeing to the terms of this Privacy Policy.

Please note that if you subscribe to one of our Services, you can make choices about how we collect, use and share your information through our Privacy Center under the "My Account" dashboard (available if you are logged into your JD Supra account).

Collection of Information

Registration Information. When you register with JD Supra for our Website and Services, either as an author or as a subscriber, you will be asked to provide identifying information to create your JD Supra account ("Registration Data"), such as your:

  • Email
  • First Name
  • Last Name
  • Company Name
  • Company Industry
  • Title
  • Country

Other Information: We also collect other information you may voluntarily provide. This may include content you provide for publication. We may also receive your communications with others through our Website and Services (such as contacting an author through our Website) or communications directly with us (such as through email, feedback or other forms or social media). If you are a subscribed user, we will also collect your user preferences, such as the types of articles you would like to read.

Information from third parties (such as, from your employer or LinkedIn): We may also receive information about you from third party sources. For example, your employer may provide your information to us, such as in connection with an article submitted by your employer for publication. If you choose to use LinkedIn to subscribe to our Website and Services, we also collect information related to your LinkedIn account and profile.

Your interactions with our Website and Services: As is true of most websites, we gather certain information automatically. This information includes IP addresses, browser type, Internet service provider (ISP), referring/exit pages, operating system, date/time stamp and clickstream data. We use this information to analyze trends, to administer the Website and our Services, to improve the content and performance of our Website and Services, and to track users' movements around the site. We may also link this automatically-collected data to personal information, for example, to inform authors about who has read their articles. Some of this data is collected through information sent by your web browser. We also use cookies and other tracking technologies to collect this information. To learn more about cookies and other tracking technologies that JD Supra may use on our Website and Services please see our "Cookies Guide" page.

How do we use this information?

We use the information and data we collect principally in order to provide our Website and Services. More specifically, we may use your personal information to:

  • Operate our Website and Services and publish content;
  • Distribute content to you in accordance with your preferences as well as to provide other notifications to you (for example, updates about our policies and terms);
  • Measure readership and usage of the Website and Services;
  • Communicate with you regarding your questions and requests;
  • Authenticate users and to provide for the safety and security of our Website and Services;
  • Conduct research and similar activities to improve our Website and Services; and
  • Comply with our legal and regulatory responsibilities and to enforce our rights.

How is your information shared?

  • Content and other public information (such as an author profile) is shared on our Website and Services, including via email digests and social media feeds, and is accessible to the general public.
  • If you choose to use our Website and Services to communicate directly with a company or individual, such communication may be shared accordingly.
  • Readership information is provided to publishing law firms and authors of content to give them insight into their readership and to help them to improve their content.
  • Our Website may offer you the opportunity to share information through our Website, such as through Facebook's "Like" or Twitter's "Tweet" button. We offer this functionality to help generate interest in our Website and content and to permit you to recommend content to your contacts. You should be aware that sharing through such functionality may result in information being collected by the applicable social media network and possibly being made publicly available (for example, through a search engine). Any such information collection would be subject to such third party social media network's privacy policy.
  • Your information may also be shared to parties who support our business, such as professional advisors as well as web-hosting providers, analytics providers and other information technology providers.
  • Any court, governmental authority, law enforcement agency or other third party where we believe disclosure is necessary to comply with a legal or regulatory obligation, or otherwise to protect our rights, the rights of any third party or individuals' personal safety, or to detect, prevent, or otherwise address fraud, security or safety issues.
  • To our affiliated entities and in connection with the sale, assignment or other transfer of our company or our business.

How We Protect Your Information

JD Supra takes reasonable and appropriate precautions to insure that user information is protected from loss, misuse and unauthorized access, disclosure, alteration and destruction. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. You should keep in mind that no Internet transmission is ever 100% secure or error-free. Where you use log-in credentials (usernames, passwords) on our Website, please remember that it is your responsibility to safeguard them. If you believe that your log-in credentials have been compromised, please contact us at privacy@jdsupra.com.

Children's Information

Our Website and Services are not directed at children under the age of 16 and we do not knowingly collect personal information from children under the age of 16 through our Website and/or Services. If you have reason to believe that a child under the age of 16 has provided personal information to us, please contact us, and we will endeavor to delete that information from our databases.

Links to Other Websites

Our Website and Services may contain links to other websites. The operators of such other websites may collect information about you, including through cookies or other technologies. If you are using our Website or Services and click a link to another site, you will leave our Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We are not responsible for the data collection and use practices of such other sites. This Policy applies solely to the information collected in connection with your use of our Website and Services and does not apply to any practices conducted offline or in connection with any other websites.

Information for EU and Swiss Residents

JD Supra's principal place of business is in the United States. By subscribing to our website, you expressly consent to your information being processed in the United States.

  • Our Legal Basis for Processing: Generally, we rely on our legitimate interests in order to process your personal information. For example, we rely on this legal ground if we use your personal information to manage your Registration Data and administer our relationship with you; to deliver our Website and Services; understand and improve our Website and Services; report reader analytics to our authors; to personalize your experience on our Website and Services; and where necessary to protect or defend our or another's rights or property, or to detect, prevent, or otherwise address fraud, security, safety or privacy issues. Please see Article 6(1)(f) of the E.U. General Data Protection Regulation ("GDPR") In addition, there may be other situations where other grounds for processing may exist, such as where processing is a result of legal requirements (GDPR Article 6(1)(c)) or for reasons of public interest (GDPR Article 6(1)(e)). Please see the "Your Rights" section of this Privacy Policy immediately below for more information about how you may request that we limit or refrain from processing your personal information.
  • Your Rights
    • Right of Access/Portability: You can ask to review details about the information we hold about you and how that information has been used and disclosed. Note that we may request to verify your identification before fulfilling your request. You can also request that your personal information is provided to you in a commonly used electronic format so that you can share it with other organizations.
    • Right to Correct Information: You may ask that we make corrections to any information we hold, if you believe such correction to be necessary.
    • Right to Restrict Our Processing or Erasure of Information: You also have the right in certain circumstances to ask us to restrict processing of your personal information or to erase your personal information. Where you have consented to our use of your personal information, you can withdraw your consent at any time.

You can make a request to exercise any of these rights by emailing us at privacy@jdsupra.com or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

You can also manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard.

We will make all practical efforts to respect your wishes. There may be times, however, where we are not able to fulfill your request, for example, if applicable law prohibits our compliance. Please note that JD Supra does not use "automatic decision making" or "profiling" as those terms are defined in the GDPR.

  • Timeframe for retaining your personal information: We will retain your personal information in a form that identifies you only for as long as it serves the purpose(s) for which it was initially collected as stated in this Privacy Policy, or subsequently authorized. We may continue processing your personal information for longer periods, but only for the time and to the extent such processing reasonably serves the purposes of archiving in the public interest, journalism, literature and art, scientific or historical research and statistical analysis, and subject to the protection of this Privacy Policy. For example, if you are an author, your personal information may continue to be published in connection with your article indefinitely. When we have no ongoing legitimate business need to process your personal information, we will either delete or anonymize it, or, if this is not possible (for example, because your personal information has been stored in backup archives), then we will securely store your personal information and isolate it from any further processing until deletion is possible.
  • Onward Transfer to Third Parties: As noted in the "How We Share Your Data" Section above, JD Supra may share your information with third parties. When JD Supra discloses your personal information to third parties, we have ensured that such third parties have either certified under the EU-U.S. or Swiss Privacy Shield Framework and will process all personal data received from EU member states/Switzerland in reliance on the applicable Privacy Shield Framework or that they have been subjected to strict contractual provisions in their contract with us to guarantee an adequate level of data protection for your data.

California Privacy Rights

Pursuant to Section 1798.83 of the California Civil Code, our customers who are California residents have the right to request certain information regarding our disclosure of personal information to third parties for their direct marketing purposes.

You can make a request for this information by emailing us at privacy@jdsupra.com or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

Some browsers have incorporated a Do Not Track (DNT) feature. These features, when turned on, send a signal that you prefer that the website you are visiting not collect and use data regarding your online searching and browsing activities. As there is not yet a common understanding on how to interpret the DNT signal, we currently do not respond to DNT signals on our site.

Access/Correct/Update/Delete Personal Information

For non-EU/Swiss residents, if you would like to know what personal information we have about you, you can send an e-mail to privacy@jdsupra.com. We will be in contact with you (by mail or otherwise) to verify your identity and provide you the information you request. We will respond within 30 days to your request for access to your personal information. In some cases, we may not be able to remove your personal information, in which case we will let you know if we are unable to do so and why. If you would like to correct or update your personal information, you can manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard. If you would like to delete your account or remove your information from our Website and Services, send an e-mail to privacy@jdsupra.com.

Changes in Our Privacy Policy

We reserve the right to change this Privacy Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our Privacy Policy will become effective upon posting of the revised policy on the Website. By continuing to use our Website and Services following such changes, you will be deemed to have agreed to such changes.

Contacting JD Supra

If you have any questions about this Privacy Policy, the practices of this site, your dealings with our Website or Services, or if you would like to change any of the information you have provided to us, please contact us at: privacy@jdsupra.com.

JD Supra Cookie Guide

As with many websites, JD Supra's website (located at www.jdsupra.com) (our "Website") and our services (such as our email article digests)(our "Services") use a standard technology called a "cookie" and other similar technologies (such as, pixels and web beacons), which are small data files that are transferred to your computer when you use our Website and Services. These technologies automatically identify your browser whenever you interact with our Website and Services.

How We Use Cookies and Other Tracking Technologies

We use cookies and other tracking technologies to:

  1. Improve the user experience on our Website and Services;
  2. Store the authorization token that users receive when they login to the private areas of our Website. This token is specific to a user's login session and requires a valid username and password to obtain. It is required to access the user's profile information, subscriptions, and analytics;
  3. Track anonymous site usage; and
  4. Permit connectivity with social media networks to permit content sharing.

There are different types of cookies and other technologies used our Website, notably:

  • "Session cookies" - These cookies only last as long as your online session, and disappear from your computer or device when you close your browser (like Internet Explorer, Google Chrome or Safari).
  • "Persistent cookies" - These cookies stay on your computer or device after your browser has been closed and last for a time specified in the cookie. We use persistent cookies when we need to know who you are for more than one browsing session. For example, we use them to remember your preferences for the next time you visit.
  • "Web Beacons/Pixels" - Some of our web pages and emails may also contain small electronic images known as web beacons, clear GIFs or single-pixel GIFs. These images are placed on a web page or email and typically work in conjunction with cookies to collect data. We use these images to identify our users and user behavior, such as counting the number of users who have visited a web page or acted upon one of our email digests.

JD Supra Cookies. We place our own cookies on your computer to track certain information about you while you are using our Website and Services. For example, we place a session cookie on your computer each time you visit our Website. We use these cookies to allow you to log-in to your subscriber account. In addition, through these cookies we are able to collect information about how you use the Website, including what browser you may be using, your IP address, and the URL address you came from upon visiting our Website and the URL you next visit (even if those URLs are not on our Website). We also utilize email web beacons to monitor whether our emails are being delivered and read. We also use these tools to help deliver reader analytics to our authors to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

Analytics/Performance Cookies. JD Supra also uses the following analytic tools to help us analyze the performance of our Website and Services as well as how visitors use our Website and Services:

  • HubSpot - For more information about HubSpot cookies, please visit legal.hubspot.com/privacy-policy.
  • New Relic - For more information on New Relic cookies, please visit www.newrelic.com/privacy.
  • Google Analytics - For more information on Google Analytics cookies, visit www.google.com/policies. To opt-out of being tracked by Google Analytics across all websites visit http://tools.google.com/dlpage/gaoptout. This will allow you to download and install a Google Analytics cookie-free web browser.

Facebook, Twitter and other Social Network Cookies. Our content pages allow you to share content appearing on our Website and Services to your social media accounts through the "Like," "Tweet," or similar buttons displayed on such pages. To accomplish this Service, we embed code that such third party social networks provide and that we do not control. These buttons know that you are logged in to your social network account and therefore such social networks could also know that you are viewing the JD Supra Website.

Controlling and Deleting Cookies

If you would like to change how a browser uses cookies, including blocking or deleting cookies from the JD Supra Website and Services you can do so by changing the settings in your web browser. To control cookies, most browsers allow you to either accept or reject all cookies, only accept certain types of cookies, or prompt you every time a site wishes to save a cookie. It's also easy to delete cookies that are already saved on your device by a browser.

The processes for controlling and deleting cookies vary depending on which browser you use. To find out how to do so with a particular browser, you can use your browser's "Help" function or alternatively, you can visit http://www.aboutcookies.org which explains, step-by-step, how to control and delete cookies in most browsers.

Updates to This Policy

We may update this cookie policy and our Privacy Policy from time-to-time, particularly as technology changes. You can always check this page for the latest version. We may also notify you of changes to our privacy policy by email.

Contacting JD Supra

If you have any questions about how we use cookies and other tracking technologies, please contact us at: privacy@jdsupra.com.

- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.