Small Business Tips

Business Law Post Archive
Featuring articles related to business law including franchise agreements, forming a business entity, regulations, immigration, bankruptcy, guidelines, tort reform, lawsuits, sexual harassment & discrimination, foreign law, litigation & business patents.
Avoiding the Courtroom: Tips for Deterring Litigation

It’s a risk every business owner takes the moment he/she opens their doors – being sued. And there are a lot of reasons your business could be pulled into court – everything from unpaid bills to outrageous claims of fraud against your company.

Anything from the substantial and justified to the frivolous can come against your business at any moment, and if you want to avoid the long, tedious court process, you’d better make sure you’re ready.

CONTRACTS
Attorney Fees Clause
Every contract you have should contain a dispute resolution section. Within that section, it’s a good idea to state that, should any dispute proceed to litigation and you win the case, the client would be responsible for your attorney fees.

This would make any client who doesn’t really have a case against you think twice before filing a lawsuit. On the other end, should you need to sue a client for an unpaid balance, etc., they will probably refrain from fighting you much if they know they will have to pay attorney fees for you.

Limitation of Liability Clause
In addition, consider adding a clause in your contract that limits your liability and damages, should there be a flaw with the product you provide, etc. For example, if you provide a product or service on a regular basis that is worth $5,000.00 then put a clause in your contract that limits your liability to $5,000.

This covers any defective products you may have, avoids needless court proceedings to determine an amount for damages, and keeps you from losing the shirt of your back to pay for non-economic damages.

Arbitration Clause
Another option is to put in the contract that any disputes that cannot be immediately resolved are to be conducted exclusively through Arbitration. More or less, arbitration is another form of mediation.

One party files a form requesting Arbitration and provides the fee up-front, which can be in the ballpark of $750. This sounds like a lot, but can be much less than a trial in court would cost with attorney fees and the like. And, whatever is decided during Arbitration, is held with the same regard as a judgment in court. More information can be found on the American Arbitration Association website.

INSURANCE
It’s important to be aware that your business insurance may cover your liability if there is a dispute. If something comes up, the first thing you should do is check with your insurance company to see if such matters are covered under your policy.

If the situation is covered, the insurance company will take over negotiations on your behalf and, hopefully, settle the matter. Be aware, however, that the insurance provider will only pay out to the extend of the policy limits. You are responsible for anything above that (but they will always try and settle below the policy limits if possible).

Another smart move, before any threat of lawsuit even comes close to your business, is to purchase additional liability insurance through your provider. A typical business policy will, unfortunately, only cover minimal disputes.

There are additional provisions for matters that would be more likely to occur for your specific business – from employment practices liability coverage to advertising practices liability coverage and the like. Be sure to talk to your provider and be aware of all of your options.

Though these steps cannot guarantee that your business won’t go to court over something, they will help to avoid it as much as possible. Keep in mind that the best thing to really do is protect your business and your customer. If you do both honestly and efficiently, then the problems should be minimal.

Always consult with an attorney before changing or developing your business contracts to make sure your business is fully protected under the law. The statements in this article are not to be taken as official guidance, but, rather, as an informational supplement to the legal aspect of your business strategy.

Source:
• Entrepreneur.com: 5 Litigation Secrets


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By Michelle Cramer
Thursday, May 25th, 2017 @ 12:01 AM CDT

Business Law, Operations |

Should You File a Patent on that Great Idea?

These days, as new businesses continually pop up on every corner of every freshly constructed commercial street, there are bound to be some duplications and similarities along the way. One way you can protect your business practices from being copied by another company is to patent them.

According to the United States Patent & Trademark Office (USPTO), a patent is: a property right granted by the Government of the United States of America to an inventor “to exclude others from making, using, offering for sale, or selling the invention throughout the United States or importing the invention into the United States” for a limited time in exchange for public disclosure of the invention when the patent is granted.

In other words, a patent keeps other businesses from making money off of your ideas. This is not simply limited to a product you have come up with, but also business practices and strategies. This also includes combining two or more products/strategies that have already been patented to form a better and more useful product or service.

For example, in Breakfast in a Whole New Way, I discussed breakfast restaurant owners who were getting patents on what kind of mix-ins could be combined with cereals, such as M&Ms and skittles, in order to keep competitors from adopting the same options for customers.

The patent process is very long and loaded with paperwork. And it is difficult and expensive to enforce a patent if someone else tries to infringe on it. So, before you sort through all the red tape, ask yourself these questions:

Has someone beat me to the punch?
Before even considering a patent, you need to make sure that no one else has already beat you to it. There are a number of online searches available including USPTO’s and Google Patent Search, which are both free. Other searches such as Delphion require a fee.

Is it worth it?
If there isn’t a patent like yours out there, then you need to determine if it is actually worth the trouble to pursue a patent. In order for it to be worth while, your business should center around the product/service you want to patent.

If someone where to copy your invention and it would result in the demise of your company, then a patent is definitely worth your time. However, if the patent is for a side product that doesn’t bring in as much revenue as your big seller, then it’s probably not necessary.

Do I have the resources?
It takes a lot of time and money to enforce a patent if someone is tapping in to your creativity. It can also be extremely expensive to defend yourself if someone else sues for patent infringement. Be sure you have the resources available to protect your company if you were to face opposition on either side.


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By Michelle Cramer
Tuesday, May 23rd, 2017 @ 12:00 AM CDT

Business Law, Operations |

Elements of a Franchise Agreement

If you’re planning on investing in a franchise, it’s important to know what you’re getting into. Though I can’t speak from experience on this issue, it’s clear from my research that most Franchise Agreements (which I will hereafter refer to as “FA”) are complicated and highly weighted toward the favor of the franchiser.

Entrepreneur.com defines a FA better than I could as representing a license to use a specific business operating system employing registered brands and trademarks for a specific period of time in exchange for a specified payment structure. And there is no doubt that a FA is specific about every little detail.

A Franchise Agreement does not mean that you are becoming part owner in the company. On the contrary, all rights to the brand, trademarks and operating systems remain solely the property of the franchiser. As a franchisee, you are more or less an investor, often temporarily.

Be sure that the terms of the FA reflect how the business is portrayed in the UFOC mentioned in yesterday’s post, Finding the Right Franchise. Though every FA varies tremendously based upon the company and product or service provided, most contain the following basic elements:

Operation of the Business
The rules, restrictions and obligations of the franchiser and franchisee regarding the successful operation of the business from the franchiser’s perspective. This includes the repair and maintenance that you are expected to contribute as well as the regulations regarding trademarks, patents, advertising policies, etc.

Territory
Where your specific business will operate and any exclusivity rights that may apply. Be aware that part of your investment in a franchise may be the purchase of real property for the business location. Many FAs require that, upon the termination of the agreement, the property be sold to the franchise company, often under market value.

Support
The training and operational support provided by the franchiser throughout the lifetime of the FA. However, this is typically at some cost to the franchisee.

Duration and Renewal
The initial duration of the agreement and your renewal options. The initial term can range from 5-20 years, more frequently toward the shorter end with multiple renewal periods. Most franchisers prefer this policy because any changes made to the FA during the initial term are automatically put into effect upon renewal, and you typically have no idea what those new regulations will be beforehand. Therefore, the longer the initial duration of the FA, the better it is for you, the franchisee. Also remember that, the better your performance, the more favorable the changes will be.

Royalties
Typically ongoing and usually 4-8% of monthly sales.

Selling
What your rights are regarding the sale or transfer of your franchised unit. Usually this contains an option for the franchiser to buy back the unit or have “right of first refusal.”

Dispute Resolution & Termination
The franchise regulations regarding the policy for resolving disputes between franchiser and franchisee, as well as the process for termination of the FA, if necessary.

As a legal assistant, I cannot stress enough how important it is that you have an attorney assist you with your review of the Franchise Agreement. An attorney can interpret the legal jargon usually found in a FA, and consult you accordingly to avoid an unfavorable situation later on.

Sources:
• Free Advice.com: What’s in a Franchise Agreement?
• Entrepreneur.com: Buying a Franchise – Ready to Commit?
• AllBusiness.com: Ten Key Provisions of Franchise Agreements


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By Michelle Cramer
Thursday, April 27th, 2017 @ 12:03 AM CDT

Business Law, Startup |

Which Business Entity is Right for You? (Part 4)

PART 4 — PARTNERSHIPS

The first thing you should be aware of when it comes to General Partnerships, whose owners are known as GPs (general partners), is that it is managed by all partners and all partners are liable for the negligence and/or debts of the business.

Each and every partner has a say in how the business is run and, even if only one partner makes a mistake, each and every partner takes the heat for it. Of course, this liability is only a problem if you or your partners cannot be trusted to run the business.

Partnerships are often used when franchising a business or when all partners contribute equally to the success of the business, such as a law firm. Taxes are paid through each partners personal income tax. There are no costs or formalities for designating your business as a partnership entity, and the only document required is a Partnership Agreement, which is crucial and should include:

• Amount each partner will invest in the business and when said investments will be made (upfront, annually, etc.);
• Rights and duties of each partner;
• Method for distributing profits and sharing in losses;
• Policies regarding withdrawals of the business assets;
• Designated division of the business profits among members;
• Policies and methods for dispute resolution;
• Policies and methods for including a new partner;
• Method for dissolving the partnership, when and if necessary.

Typically profits are divided equally among members, but you can designate otherwise in your partnership agreement. Keep in mind that giving one partner a larger percentage of the business assets does indicate that they have a stronger say in the decisions regarding the operation of the business. It is usually in the best interest of all involved to stick to equal distribution.

A partnership lasts only as long as a good relationship between partners. It can be dissolved if the partners no longer wish to work together using the methods indicated in the partnership agreement, which can include the sale of the business as well as dismissing one member and bringing another in.

Partnerships also have the option of including one or more limited or silent partners (LPs). LPs are individuals who invest in the partnership but, based upon the Partnership Agreement, are limited in their involvement in the operation of the business. Also, LPs’ legal liability is generally limited to how much they invest, so they can basically reap the benefits of the partnership (i.e. profits) without being responsible for the debts.

It is important that you examine all of the available options for business entity designation and determine which is best for you and your business before you get the ball rolling. Please consult with a lawyer before before making any legal decisions.

Part 1: Sole Proprietorships
Part 2: Corporations
Part 3: Limited Liability Companies

Sources:
• Entrepreneur.com: Business Structure Basics
• Start-a-Business.com: General Partnership
• AllBusiness.com: Corporation, Partnership, or an LLC?
• About.com: Partnerships
• Wikipedia.org: General Partnership and Limited Partnership


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By Michelle Cramer
Sunday, April 16th, 2017 @ 12:00 AM CDT

Business Law, Startup |

Which Business Entity is Right for You? (Part 3)

PART 3 — LIMITED LIABILITY COMPANIES

Limited Liability Companies, or LLCs, combine several features of Corporations and Partnerships, but are neither. Often people call them “limited liability corporations,” but that is incorrect. The owners of an LLC are termed “members” rather than partners or shareholders. The number of members is unlimited and can be a combination of individuals, corporations or other LLCs.

LLC members are not held liable for the negligence and/or debt of the LLC they have ownership interest in, unless they sign a personal guarantee. Like a corporation, an LLC is an entirely separate existence from the individuals involved.

Another benefit is that there are fewer requirements for an LLC. It is not necessary to keep meeting minutes or record resolutions, as in a corporation, and you are not required to have a board of directors or make officer designations for the members.

Some states do have minimal requirements for an LLC, but what those are varies from state to state. Typically, you are also required to file Articles of Organization and Operating Agreement when registering your business as an LLC.

The designated distribution of income to the members is entirely flexible, leaving the division to be anywhere from 50-50 to 10-90, and, of course, open for division among any number of members.

As a member, you also have much more access to the assets of the company. You can take assets out for personal and/or business use without incurring tax liability. Owners also have more leeway when it comes to writing off business losses when associated with an LLC.

The lifetime of an LLC is limited. If any member dies or files bankruptcy, the LLC is dissolved. Additionally, an LLC is not nearly as appealing to possible investors, so if you are considering going public with you company, or issuing shares to your employees someday, an LLC is not the route you should go.

However, if legal liability protection and one level of taxation are primary concerns for your business owners — who consist of multiple and diverse individuals and/or businesses — than an LLC is probably just right for you.

Part 4: Partnerships
Part 1: Sole Proprietorships
Part 2: Corporations

Sources:
• Entrepreneur.com: Business Structure Basics
• About.com: Limited Liability Company 101
• Start-a-Business.com: Limited Liability Company
• AllBusiness.com: Corporation, Partnership, or an LLC?


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By Michelle Cramer
Saturday, April 15th, 2017 @ 12:00 AM CDT

Business Law, Startup |

Which Business Entity is Right for You? (Part 2)

PART 2 – CORPORATIONS

Corporations are considered a legal entity which exists separately and independently from the individuals who create and manage it. Only the corporation itself is legally liable for any negligent actions or debts it may produce. The individual shareholders are not liable.

There are a number of requirements for a corporation:

• Must have an elected board of directors or officers
• Must have an operating agreement
• Must keep records such as annual meetings, meeting minutes, record of resolutions and file annual reports.

Advantages
The benefits of a corporate entity are substantial. A corporation has an unlimited lifespan as it is not dependent on the life of an individual, as proprietorships and partnerships are. As long as annual reports are filed consistently, the corporation will remain in good standing.

The flexible transferability of shares is another large benefit. Ownership of shares in a corporation can be sold, transferred, given or inherited by simply endorsing and signing over an individual’s stock certificates. It is not necessary to file deeds or retitle anything.

You would also benefit from the increased ability to raise investment capital. It’s much easier to attract new investors to back your business if it is registered as a corporation because of the limited liability of shareholders and the easy transfer of shares.

Disadvantages
The major disadvantage of registering your business as a corporation is that it can create an additional tax burden. If your business is designated as a C Corporation, then the profits of your corporation are first taxed at the corporate level and then, any distributions to shareholders are also taxed on each individual’s personal income tax. S Corporations, however, are not taxed on the federal level — only the shareholders’ income is taxed.

If your business is large, or headed that direction, you might want to consider establishing your business as a Corporation. This is an especially preferred choice if you want to market your business to a number of investors, because the “Inc.” following the name of your business can be very appealing.

Part 3: Limited Liability Companies
Part 4: Partnerships
Part 1: Sole Proprietorships

Sources:
• Entrepreneur.com: Business Structure Basics
• AllBusiness.com: Corporation, Partnership, or an LLC?


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By Michelle Cramer
Friday, April 14th, 2017 @ 12:00 AM CDT

Business Law, Startup |

Which Business Entity is Right for You? (Part 1)

When starting a new business, you will be required to determine the type of business entity it is for tax purposes. There are a number of them out there and each one has different benefits and draw backs. It is best to understand them all before determining which is best for your company.

PART 1 – SOLE PROPREITORSHIPS
The sole proprietorship is the best option for someone who is starting a business in which she will be the only person involved. Many individuals who work out of their home, such as freelance writers, photographers, eBay business owners, etc., opt for a sole proprietorship for their business.

It is considered the quickest and easiest business setup process. There are no prerequisites for your business, an attorney is not necessary, and there are minimal costs for establishment of the sole proprietor entity. In most states, you simply register your business as a fictitious business name. In other words, [your name] doing business as [name of your business].

A fictitious registration does not, however, protect the name you choose for your business – anyone else can use that name. On the other hand, doing so does allow you to use the name of the business rather than your own for business banking accounts and other documentation.

There are some minimal formalities you may need to address when establishing a sole proprietorship:

• Obtain a Federal Tax Identification Number or EIN (otherwise, you will have to use your social security number).
• Obtain an occupancy permit for your place of business, if it is outside your home, depending on the requirements in your state.
• Obtain a business license, if your state requires.

Profits made on a sole proprietorship are considered the personal income of the owner and are taxed as such. It is best to set aside at least 25% (sometimes more) of any profits to pay in quarterly installments to the government. I recommend that you consult with an accountant to determine your best options regarding the taxes on your business.

There are two distinctive drawbacks to this type of business entity. As sole proprietor, the business you start has no separate existence from you. You are personally liable for the debts of the business, which means any debt you may be in default on will end up on your personal credit record. It is best to start this type of business with little to no debt associated with it.

Also, the existence of a sole proprietorship only lasts as long as you do. If a family member wishes to continue the business after you retire or pass away, he will have to register the business under his own name. Of course, as I pointed out, this process requires very little effort.

If you’re just getting starting as an entrepreneur, then I highly recommend that you designate your business as a sole proprietorship. Should the business begin to boom and grow, and you require some help to keep things moving, then you may want to consider other entity options.

Part 2: Corporations
Part 3: Limited Liability Companies
Part 4: Partnerships

Sources:
• Entrepreneur.com: Business Structure Basics
• Start-a-Business.com: Sole Proprietorship
• AllBusiness.com: Corporation, Partnership, or LLC?
• Wikipedia.org: Sole Proprietorship


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By Michelle Cramer
Thursday, April 13th, 2017 @ 12:00 AM CDT

Business Law, Startup |

How Changes in Congress Could Affect Small Business

Small business owners were glued to their televisions last week as election ballots were tallied. In the end, 51 Democrats had seats in the House, compared to Republicans 49 seats. The House currently has 230 Democrats and 197 Republicans, with eight elections still determined ties.

Based on a pre-elections survey done by Wells Fargo and Gallup, approximately 75% of business owners believed the congressional takeover by Democrats would have a direct effect on small businesses nationwide. Various issues are expected to come into play.

Trade Promotion Authority
President Bush has ambitiously been seeking renewal of the Trade Promotion Authority, which will lapse in June. Created in 1974, TPA allows the president to negotiate trade agreements. Congress can approve or squash the agreements, but cannot amend them, which protects the agreements from gruelingly being picked to pieces once they were made with the U.S.’s trading partners. The shift in power is expected to slow the President’s progress on getting a renewal approved prior to the lapse, if at all.

Taxes
Estate Tax/Death Tax have been a long time reformation agenda for small businesses. It is a taxation of 30-50% on assets that are transferred from one generation to the next upon death. In other words, if dad dies, and leaves son a business and property worth $20 million, it will be taxed up to $10 million. If an asset is left to a spouse or a charitable organization, the tax usually does not apply.

A repeal of the tax was on the table, but it is expected to fall to the wayside. There may be a bipartisan approach, but it is not expected to be anything immediate, as the estate tax is not currently a congressional priority.

Healthcare
As far as healthcare, small businesses have been pushing for some sort of reform that will allow them to provide affordable health insurance to their employees. One such hope was association health plans, which would allow small businesses to band together on one insurance policy, even across state lines. The idea is highly supported by Republicans, not as favored by Democrats. It is expected that some option will be extended to small businesses, although association plans will probably not be utilized.

Minimum Wage
The national minimum wage has been $5.15 per hour since 1997. Based upon calculations, someone working a full-time job at this rate would make just over $10,000 a year, which is the national poverty line. In last week’s elections, six states approved raising the state minimum wage. There are now 29 states, plus Washington D.C., whose minimum wage is higher than the federal.

Raising the national minimum wage is a top priority for Democrats coming into a new congressional year. There is speculation that an increase in minimum wage would harm small businesses and increase the unemployment rate. However, a study by the Center for American Progress found that employment in small businesses grew in states where the minimum wage has already increased. Inflation is another concern for critics, but, truth be told, the pressures and struggles for small business under an increase would be marginal.

Iraq
The war in Iraq was the number one issue on voters’ minds, according to exit polls. Though it may not be directly connected to small business, it deserves mentioning. The Democratic takeover of Congress and a new Defense Secretary, combined with the people’s dislike of the way the war is being handled, will likely lead to a change in approach and policy.

Democrats want the Iraqi government to take more responsibility for its development and the war on terror in their country. The plan for doing so is to start pulling our troops out of Iraq and handing over the reigns. There have been requests of President Bush to convene an international conference on Iraq. Other suggestions presented may be regional dialogues with our adversaries in Iran and Syria for assistance or developing three sectarian states of the country.

The replacement of Donald Rumsfeld has led most to believe that President Bush is more open to these suggestions. In his address to the country regarding Rumsfeld’s resignation, Bush stated, “Secretary Rumsfeld and I agree that sometimes it’s necessary to have a fresh perspective.”

Changes are inevitably upon the horizon. Whether those changes are positive or negative depends entirely upon perspective. I would like to close with a statement made by Todd Stottlemyer, CEO of the National Federation of Independent Business (NFIB):

“Small-business issues transcend party lines and we want to work with lawmakers from both sides of the aisle to create an environment where businesses can flourish and grow and strengthen the American economy. That’s what NFIB is all about, promoting and protecting the right of our members to own, operate and grow their businesses. The key is providing a climate within which to do that.”

Sources/Related Readings:
• NFIB: Midterm Election Results In
• Business Week: Small Biz OK With New Congress
• Inc.com: What Does a Democratic Takeover of Congress Mean for Your Company?
• San Francisco Chronicle: Changes From Election May Weaken Bush’s Trade Agenda
• Reuters Election 2006: Economic Impact of Likely Minimum Wage Rise Unclear
• International Herald Tribune: Elections, Rumsfeld Exit Open Door to Change


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By Michelle Cramer
Tuesday, April 4th, 2017 @ 12:00 AM CDT

Business Law, Operations |

Immigration Laws Proving Difficult for Business Owners

It’s not news that the U.S. is cracking down on illegal immigrants, though there is constant debate on how that should actually be done. It’s a focal issue among presidential candidates, and many people have a set opinion as to how this matter should be dealt with.

And it leaves very few people unaffected, especially business owners. In fact, the newest regulations have caused some new confusion. First, in August the Department of Homeland Security (DHS) announced the implementation of a new “no-match” letter program, which would be a formal letter informing an employer that the social security number provided for an employee does not match that employee’s name. In October, the Northern District Court of California put this new program on hold, but in November the court suspended the injunction, giving DHS until March of 2008 to rework the program.

Continue Reading: “Immigration Laws Proving Difficult for Business Owners”


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By Michelle Cramer
Wednesday, November 30th, 2016 @ 12:00 AM CDT

Business Law |

New Safety Measures for Imports on the Horizon

On November 6th 2007, President Bush proposed new safety measures to insure that items imported into the United States meet safety standards. This step is resulting from the increased number of recalls in the past couple of years, specifically items such as toothpaste, dog food and toys produced overseas.

Bush proposes that the following improvements be made:

• Giving the Food and Drug Administration (FDA) the authority to order mandatory recalls of unsafe products. As it stands now, the FDA can only encourage companies to voluntarily recall unsafe items, but have no way of enforcing a recall if the company refuses to do so.

• An increase in the presence of U.S. inspectors from Customs, Border Patrol the Consumer Product Safety Commission (CPSC) and other agencies in countries that are major exporters to the U.S.

• A certification program (“seal of approval”) for companies that meet safety standards on a proven and regular basis. This change is expected to help encourage retailers to use businesses with the certification, and help discern those companies that are not meeting safety standards often enough.

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By Michelle Cramer
Saturday, November 12th, 2016 @ 12:00 AM CDT

Business Law, Money |

When to Consider Bankruptcy as an Option

Truth is, most of us don’t want to EVER consider bankruptcy as an option to get out of debt looming over our heads, especially when it comes to our goal for a successful business. Filing bankruptcy, in the eyes of most, is like admitting defeat at our dreams, and no one wants to do that.

Unfortunately, however, there are often circumstances beyond our control, such as unexpected medical problems, which force us into a financial corner that, no matter how we try, we just can’t seem to get out of. If you’re in that corner, and haven’t consider bankruptcy as an option yet, maybe you should.

Consider the following to determine whether bankruptcy may be your only way out:

Map Out a Payment Timeline
Determine your personal average monthly income, and list your personal expenses (such as groceries, mortgage, etc.). Next, list your businesses monthly income and business expenses (utilities, supplies, payroll, etc.). Determine what you have left each month after expenses. No, list your debts, including monthly interest, and find a total.

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By Michelle Cramer
Sunday, October 16th, 2016 @ 12:01 AM CDT

Business Law, Money |

Revisions to the U.S. Patent Law Under Consideration

United States Patent and Trademark OfficeThe House endorsed a bill last week that would mark “the most significant changes in patent law in more than 50 years.” The last major change to patent law was in 1952. Supporters of the renovations include consumer groups, major high-tech companies, financial associations and farm groups.

The most significant change is duplicating the patent process already established in many overseas countries, such as Europe and Japan, of “first to file” as the patent holder. Currently, the U.S. is the only major industrialized country in the world that still holds a “first to invent” policy.

Of course, these changes would need extra protect from fraudulent inventors who file a patent but have yet to invent the actual product, while someone else has invented the product but was second to file the patent.

Continue Reading: “Revisions to the U.S. Patent Law Under Consideration”


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By Michelle Cramer
Tuesday, October 11th, 2016 @ 12:00 AM CDT

Business Law |

New EEOC Guidelines Expand Employee Protection

Equal Employment Opportunity CommissionOn May 25th the Equal Employment Opportunity Commission (EEOC) released a new set of guidelines meant to protect those with caregiver responsibilities from employee discrimination. This includes, but is not limited to, employees with children, who care for the elderly, or who have an ill spouse, parent or in-law. These guidelines, of course, are meant to protect both men and women.

What the EEOC intends to protect is the employee’s ability to be available for those who are under his/her care. Some of the discriminatory issues that may arise, and the EEOC intends to prevent, are inflexibility in schedule (including mandatory overtime) and stereotypes that those who are deemed caregivers are less committed to their job and less deserving of promotions, raises and the like.

Continue Reading: “New EEOC Guidelines Expand Employee Protection”


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Thursday, September 22nd, 2016 @ 12:02 AM CDT

Business Law |

Is Tort Reform Necessary to Protect Small Business?

According to a survey by the Institute for Legal Reform, release in May, more than half of small business owners polled are not all that concerned about being sued. But, as I pointed out in a post earlier this month (see The Lawsuit Risks of Having a Website), we live in a world of lawsuit happy people, who want anyone to blame but themselves.

That seems to be the circumstances, in my opinion, in the case of the D.C. judge who sued his neighborhood dry cleaner for $54 million over a misplaced pair of pants. Apparently Judge Roy Pearson dropped of a pair of pants at Custom Cleaners, owned by Soo and Jin Chung, to be altered. According to his side of the story, when he returned to pick up the pants, the Chung’s said they couldn’t locate them. A week later they returned pants to him, but Pearson claims they were not the one’s he brought in.

Continue Reading: “Is Tort Reform Necessary to Protect Small Business?”


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By Michelle Cramer
Thursday, September 15th, 2016 @ 12:01 AM CDT

Business Law |

The Lawsuit Risks of Having a Website

We all know that with any business venture there is risk involved – sometimes minor, often substantial. Being sued is a big risk, especially as your company grows and your network of clientele and other businesses expands.

Especially if you have a website.

Yes, you read that right. In this lawsuit-happy world of ours, all it takes is having a website, or allowing employees to use the internet at work, to drag you and your business into the courtroom. Everything from whines about content to product trademark and patent issues – all at the click of a mouse. Don’t get me wrong, having a website is synonymous with being successful with your business. It’s practically necessary. But you should be aware of the risk it involves.

Here are some examples of what can get you and your business into trouble when it comes to the internet:

Continue Reading: “The Lawsuit Risks of Having a Website”


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By Michelle Cramer
Wednesday, September 7th, 2016 @ 12:00 AM CDT

Business Law, Technology |

Being Sued by Big Business Competition

Tom Szaky has a new business – TerraCycle provides organic plant food, made from worm feces, and just recently secured its major financial backer. But just about that time, Szaky received a 173 page lawsuit. The Plaintiff: Scotts Miracle-Gro. Their accusations: that TerraCycle falsely claims that its product “outgrows the leading synthetic fertilizer,” and trade dress issues (in other words, TerraCycle’s packaging too closely resembles Miracle-Gro’s).

How do you, as a small business owner, deal with the squeeze from the big business corporate competition. Well, it’s foremost important to keep in mind that, if you make claims against those competitors, like your product can outgrow their’s, you probably need to make sure you can back up that claim.

Continue Reading: “Being Sued by Big Business Competition”


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By Michelle Cramer
Sunday, September 4th, 2016 @ 12:00 AM CDT

Business Law, Money |

Preventing Sexual Discrimination in the Workplace

As I have mentioned before in this blog, I am, among many other things, a legal assistant at a law firm. It’s a small firm, consisting of five attorneys, all men, and six legal assistants, all women. Though it wouldn’t be that strange for a female attorney to join the firm, it would be quite odd to have a male paralegal join the gang.

There are many professions that tend to appeal predominately to one sex or the other. Most nurses are women. Most construction workers are men. Daycare teachers – women. Trash collectors – men. Most of these jobs have always been this way, typically because that particular job fits the strengths of one particular sex better than the other. That doesn’t mean, however, that there isn’t a tough broad out there who couldn’t guide a steel beam into place.

Imagine with me, if you will, the opposite gender “infiltrating” one of these or many other professions that tend to be single-sex oriented. For example, if a female attorney joined our firm, it would probably be of little consequence, since female attorneys aren’t scarce, they’re just not part of our particular firm. However, I can imagine that a woman who gets a job pouring concrete at a construction site would receive her unnecessary share of cat calls and sexist remarks.

Continue Reading: “Preventing Sexual Discrimination in the Workplace”


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By Michelle Cramer
Sunday, August 14th, 2016 @ 12:01 AM CDT

Business Law, Human Resources |

Expanding Your Business Overseas: Protecting Your Product

When starting a business in America, one of the most crucial elements is to get your product or business practices patented or copyrighted. Unfortunately, when it comes to expanding your business to the global market, a U.S. patent won’t protect your money-maker, as they are not enforceable overseas. There are some things you can do, however, to guard yourself from idea theft.

What you should probably do first is file with the Patent Cooperation Treaty under the United Nations World Intellectual Property Organization (WIPO). According to John Lanza, a Boston attorney, at a cost of $3,000 to $6,000, a PCT filing can preserve your right to patent your product in most major nations for up to 30 months. That way you can test the waters in a number of markets in order to find your niche.

Once you’ve determined where your product will be most successful, you should file a patent in that particular country. If you don’t, them moment you begin to offer your product copy-cats will begin producing competition with their knockoffs. Obviously the process for filing a patent differs with each location. For more assistance, The U.S. government provides a “tool kit” on international patents at StopFakes.gov.

International patents have classifications, in order to streamline the application process. After all, there has to be a way to determine if someone already has a patent for a particular product in a particular country. For more information of this classification process, visit the WIPO’s International Classifications page.

Danger – be aware of the fact that China is one of the leading countries when it comes to intellectual property theft. Ted C. Fishman, author of China, Inc. recommends that, in order to help protect yourself you should establish a licensing agreement with a Chinese business partner that requires him to provide a substantial upfront contribution to your business expansion. Such an investment will keep him from revealing product specifications to another manufacturer or trying it on their own and will also help to keep other Chinese businessmen from trying to tap in to your market.

Bottom line, protect your most important asset, the product you provide, whatever it may take. Though there may be some cost to it, in the end it would be more than worth it. The alternative, a cheaper knockoff of your product stealing your customers, would be detrimental.

Tomorrow I will cover the monetary and taxation aspects of owning a business overseas.

Pt. 1: Why and Why Not Expand Overseas?
Pt. 2: Labor Laws
Pt. 4: Money and Taxes

Source:
• Inc.com: How to Get Started

Resources:
U.S. Patent and Trademark Office
European Patent Office
Patent Pending in 24 Hours by Richard Stim and David Pressman


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Sunday, August 7th, 2016 @ 12:02 AM CDT

Business Law, Operations |

Expanding Your Business Overseas: Labor Laws

A milestone in the growth of any business is the capacity to expand into the global market. As exciting as the looming possibility may be, you don’t want to cross the boarder blindly, especially if you are passing the internet zone and actually opening your doors in a foreign land.

As most know, the laws vary in every country, and labor laws are no exception. If you’re expanding your business to another country and plan to have employees in that country, it’s important that you know what you’re dealing with before you except any resumes.

For example, U.S. employers have basically complete control over who they hire and fire. But in other countries, that’s not always the case. But, according to New York lawyer Aaron Schindel, in the European Union and much of South America, employers are legally obligated to consult with employee representative, whether it be a union or works council, before relocating an office, conducting layoffs, or even discontinuing a product.

Labor costs may be low and appealing for expanding your business overseas, but the other financial obligations that come with being a foreign employer make the cost of running a global business fall onto a comparable scale to that of U.S. only operations.

When it comes to worker benefits, many countries require employers to provide a month of paid vacation and/or mandatory bonuses. Take the Mexican aguinaldo, for example, a mandatory Christmas bonus provided to every employee in Mexico and equivalent to 15 days wages or more.

When it comes to health insurance for your employees, things may be a little easier. Most countries provide universal health care for workers. This is often partly funded by payroll taxes, which can have high rates, but are typically more cost effective than the continual rise in insurance premiums in the U.S.

There are many other things to consider when looking to expand your business overseas. Check back tomorrow for information on how to protect what keeps your business running, the product your provide.

Pt. 1: Why and Why Not Expand Overseas?
Pt. 3: Protecting Your Product
Pt. 4: Money and Taxes

Source:
• Inc.com: How to Get Started

Resources:
The International Labour Organization
• U.S. Dept. of Labor (dol.gov): Foreign Labor Trends Reports
• Univ. of Chicago: Foreign Law


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By Michelle Cramer
Saturday, August 6th, 2016 @ 12:02 AM CDT

Business Law, Operations |