Tag Archives: Business Formation

Startup Operating Agreements: Everything You Need To Know In 5 Minutes

startup-law
You’ve got a startup, and you’re looking to make it legit. If you’re serious about doing things the right way, the first thing to do is get an operating agreement. The free startup operating agreements you find online are sometimes inaccurate or don’t do a great job of protecting entrepreneurs’ interests. If you do use a free startup operating agreement, you may find yourself beholden to archaic default business operation laws. So, the best thing to do – and no, I’m not just saying this because I’m a startup business lawyer (well, maybe a little) – is to find a startup business lawyer who can draft a rock-solid operating agreement that protects your interests as far as the law allows. What should be in a startup operating agreement? Let’s break it down. What is the purpose of an operating agreement? ...
Read more...
Posted in Business Formation, Startup Law | Tagged | 1 Comment

Class Action Lawsuits: Overview and Marketing Cases

laptopbooks
Class Action Lawsuits Part I: History History of Class Action Litigation Class action litigation dates all the way back to medieval England. Thanks to treacherous roads and equine-powered vehicles, it was difficult for Kings, Queens and henchmen to travel from one village to village dispensing justice. As such, dealing with legal conflicts en masse became the norm. But things eventually improved in jolly old England. Roads became less death-trapy; horse-and-buggy technology blew up; travel became safer and smoother. The improvements affected politics, culture and justice, not the least of which was a shift from group to individual litigation. By 1850, the UK Parliament had enacted several statutes which lessened the effectiveness of group litigation. But at around the same time in the United States, group litigation lived on, albeit oddly, thanks to Supreme Court Justice, Joseph Story. Class Action Law ...
Read more...
Posted in Business Litigation, Marketing Law | Tagged , , | 1 Comment

Can A Business Enforce A Contract Defamation Clause In Customer Agreements?

contract-sm
In 2010, Jen Palmer’s husband ordered her a “desk toy” from Klear Gear. It never arrived. Eventually, however, the Palmers got a refund. Nevertheless, they added a negative review to Klear Gear’s Ripoffreport page after not being able to connect with a customer service representative from the company. After venting their feelings online, presumably the Palmers got back to their lives. Then, out of the blue, two years post-incident, the couple received an official letter in the mail. It was from Klear Gear, and the company was demanding that the Palmers pay $3,500 for violating a non-disparagement clause in the customer contract. WHA!?!?! Yeah, that’s what the Palmers said, too. But sure enough, Klear Gear’s “buyer’s contract” prohibits customers from trashing the company “to ensure fair and honest public feedback and to prevent the publishing of libelous content in any ...
Read more...
Posted in Defamation | Tagged , | Leave a comment

JOBS Act: More Startup Opportunities?

trade libel
In 2012, President Obama signed the JOBS Act into law. Dubbed the Jumpstart Our Business Startups Act, the statute intended to ignite America’s small business sector by democratizing the way companies can market investment opportunities. JOBS Act Perk For Startups: Allows Startups To Crowdsource Initial Stock Investments Over the past several years, crowdsourcing has taken off, but many rules still stand in the way of being able to crowdfund everything. The JOBS Act, however, removes some of the obstacles. Most notably, Title III of the Act removes various registration and investment requirements thereby paving the way for startups to sell stocks over the Internet. JOBS Act Perk For Startups: Increases The Shareholder Reporting Threshold Not only does the JOBS Act permit the online sale of startup stocks, but it also extends the financial reporting start date, from two years from ...
Read more...
Posted in Business Formation, Government Internet Law Legislation | Tagged , , | Leave a comment

Congress Clearing The Way for Startup Stock Selling, Online

rich-list-defamation-suit
In short order, startups will be able to sell stocks online to so-called “small-time” investors. Yep, crowdfunding for securities is finally (almost) here. So, let’s go over the SEC’s recent proposal and give an overview of what online stock selling will look like. What Law Made It Possible For Startups To Sell Stocks Online? In an effort to get the economy back on track after it careened off the rails in 2008, officials passed the JOBS Act in 2012. The bill is comprised of several sections relating to various commercial sectors. Title III addresses issues related to crowdfunding businesses. Specifically, it allows inchoate companies to directly solicit investments for their businesses online.  In the language of the law, the online securities provision “permits companies to offer and sell securities through crowdfunding.” The JOBS Act gives the Securities and Exchange Commission ...
Read more...
Posted in Business Formation, Government Internet Law Legislation, Online Marketing | Tagged , | Leave a comment

Finance Firm Says SEC Is Slander Happy, So It’s Suing. So Can You.

trade libel
A finance firm is suing the SEC for business defamation. It argues that the commission is unfairly targeting smaller firms -- with no in-house legal staff -- to make itself look better. Click on the read more link to learn about this interesting business defamation lawsuit.
Posted in Defamation, Government Internet Law Legislation, Marketing Law | Tagged , , | Leave a comment

Bilateral Arbitration v. Class Action

Be careful how much puffery you include in marketing material. Too much can land you in the clink.
Lawsuits don’t rectify every legal dispute. For example, bilateral arbitration is also a popular conflict resolution solution used by many companies. Trouble can arise, however, when one party wants to handle things in court while their opposition advocates for bilateral arbitration. The lawsuit versus arbitration conflict was at the center of American Express Co. v. Italian Colors Restaurants. In brief, the Plaintiffs, Italian Colors Restaurants, et al, wanted a judge to nullify a provision in the American Express vendor contract which stipulates arbitration as the sole avenue of resolving a legal dispute. A noteworthy lawsuit, American Express v. Italian Colors raises two pertinent legal questions: Can an arbitration agreement be tossed out by a judge in favor of a class action lawsuit? If so, under what circumstances? What constitutes “effective vindication” when it comes to dismantling an arbitration resolution contract? ...
Read more...
Posted in Business Litigation | Tagged , , | 1 Comment

Arizona Benefit Corporations: A New Business Registration Category

academic defamation
Is your startup equally interested in do-goodery and money? If yes, consider registering your company in Arizona, because Gov. Jan Brewer just signed Senate Bill 1238 into law. The legislation allows for a new business category in The Grand Canyon State – Benefit Corporations. Arizona Benefit Corporations: Between Profit Corps. And Non-Profits Arizona’s new business class is perfect for companies that want to be a positive force in their communities –social or environmental, big or small – while at the same time enjoying a healthy bottom line. In the simplest terms, the Arizona benefit corporation is a hybrid of a regular corporation and a charitable organization. Tax Benefits Of An Arizona Benefits Corporation Don’t, however, jump to conclusions and assume using the Arizona benefit corporation classification will save you money in taxes. In fact, on the face it won’t as ...
Read more...
Posted in Business Formation, Business Litigation | Tagged , , | Leave a comment

Business Liability for Employee Conduct – Negligent Employment

business litigation information
“Negligent employment” actions are based on conduct that may be more specifically described as negligent hiring, negligent supervision, and negligent retention. Courts and litigants often use these terms interchangeably. Technically, however, there is a difference among the three types of negligent employment, which is based on the length of employment. In some jurisdictions, a claim of negligent hiring, supervision, or retention may not be cognizable in certain situations, requiring a plaintiff to assert an alternative cause of action. For example, Kansas law does not recognize a cause of action for negligent supervision, hiring, and training in the context of sexual harassment. To establish a prima facie case in an action based on the negligent hiring, supervision, or retention of an employee for damages caused by an employee’s tortious act, the plaintiff must show that: 1. the employer had a duty ...
Read more...
Posted in Business Litigation | Tagged , | Leave a comment

Internet Business Litigation

Business Litigation
Business litigation is a wide-ranging area of law. Let’s take a few minutes to review what a business litigation attorney does and how they can help small- and medium-sized startups and companies. Business Litigation Practice Area: Contract Disputes Contracts are the backbone of most business transactions. They outline partnerships, affiliate relationships, crowdsourcing agreements, and use-terms for apps, websites and cloud-based networks. A strong contract can save you headaches down the road and a bad one will elicit the opposite effect. The other thing with contracts is that they can be interpreted in a myriad of ways (and that’s why lawyers have a way of being overly verbose at times). As such, a great business litigation lawyer for Internet companies is one that knows the industry inside and out. That way they can take full advantage of their nuanced knowledge of ...
Read more...
Posted in Business Formation, Business Litigation | Tagged , , , , | Leave a comment