Legal Issues That Can Thwart Your Small Business Success

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Small businesses often spawn from creative ideas, a lot of determination and significant sacrifice. Therefore, after everything you invest, you don’t want to lose it. There are some things small business owner do not realize they’re doing wrong, until it is too late – and often not until they are sued, fined or some other drastic measure is taken.

To keep your small business running smoothly, you should be aware of a few legal issues. That way you can ensure your business gets off to the right start.

Give Partners Credit

To start your business, did you establish partnerships? Even if those partnerships are not in writing, honor any deals you may have made in order to establish your business. Ignoring those agreements could mean that partner comes back later with a lawsuit – asking for their share of the business.

Legal Agreements

Do not draft your own legal agreements, ever. Instead, have a San Antonio business lawyer draft them for you. An attorney can draft everything from sales agreements to non-disclosure agreements to your employment contracts. Because the area of business law is so complex, you need an attorney that understands these issues and can draft legally binding contracts.

Be Smart with Investors

If you are going to ask for funding from other investors, be smart about how you obtain those funds. Have your San Antonio business lawyer oversee the financial transactions, draft the contracts and ensure you’re following all state and federal laws.

Hire an Attorney

The biggest mistake a small business owner can make is handling legal issues on their own. There are a lot of state, county and federal laws to understand – and these change frequently. If you do not know the latest laws, you could find yourself in a lot more trouble than you may realize. An attorney’s job is to understand your local and federal business laws; ensuring your business is always in compliance.

Are You Violating a Non-Compete by Starting Your Own Business?

Starting your own business can be exciting – you’re going to be your own boss. But, before you make that business idea official, have you looked at your non-compete agreement with your past or current employer? The last thing you want as a small business startup is a lawsuit from a former boss. Therefore, you need to cover your ground and review your contracts before making your business a real deal.

Review Your Non-Compete

If your existing or past employer didn’t want you as a competitor, they may have required you to sign a non-compete agreement. This agreement may prohibit you from starting a similar business to theirs in the same city or county and may prevent you from doing so for a specific period.

If you had or have an employment contract, it likely has a non-compete. Therefore, you may want to consult a non-compete lawyer and have that agreement reviewed before starting your own business. If your business doesn’t violate the non-compete, then you should be fine to start. But if it does, you will need to explore other legal options before actually starting the business.

Are You Violating a Non-Disclosure?

When you worked for your former employer, did you learn certain trade secrets that you plan to use in your new business? Even if there is no non-compete, you may have agreed to not use that confidential information; therefore, if your new business products or services use proprietary information from a past job, you are violating your contract – and could be sued for breach of contract.

Was Your Idea Created While Employed?

Some employers have contracts that claim all rights to products or inventions you create while working for their company. Even if the product you created has nothing to do with your employer, they may have rights to that invention because of their contract.

It is best to hire a non-compete lawyer to review all employment contracts with past employers – even those that are over a decade old. While some may have expired, there are instances you may not be able to start up your own business, regardless of how long it has been.

What Do I Do If I’m Served with a Deposition Subpoena?

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A deposition subpoena is a document that requires you to submit your testimony to a third-party or to produce documents. Depositions are used as a pre-trial discovery phase and they take place often at your attorney’s office or the office of the other party’s attorney. While depositions do not have a judge or a jury, you still must conduct yourself as if you were going to court. It is best to have your San Antonio business attorney review the deposition requirements as well as be present during the deposition.

Do You Have to Go to the Deposition?

Your San Antonio business attorney will review the subpoena to make sure it is valid. If it is, you must go or you will be held in contempt of court. But, the other party must give you adequate notice to prepare for the deposition – which usually is five to 14 days. Also, you are required to bring any documents requested in the subpoena. If you fail to do so, the courts may issue an order requiring you to testify. In a civil case, ignoring your deposition could make you appear as though you are not cooperating or hiding something too.

Answering the Questions

You must answer all questions asked in the deposition as long as they are relevant. Your attorney will be present during the deposition and can determine whether or not a question is relevant to the case. Any answer you give must be truthful, because while you are not in court, you are still testifying under oath. Also, remember that the answers you give during a deposition will be used at the trial. A court reporter will also be present to record your answers and you are most likely going to be videotaped – which may be played at the trial too.

Do You Need an Attorney?

If your business is being sued and you have received a deposition subpoena, you should hire a San Antonio business attorney. An attorney will prepare you for the deposition and go to the deposition with you. By having an experienced attorney by your side, you can protect your own rights as well as your company. Your attorney will ensure you don’t answer anything that will expose you to further lawsuits.

Should You Use At-Will Employment?

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An employment agreement is typically at-will. That means employees or the employer may terminate their working relationship at any time – and for any (legal) reason. Even if the employee did nothing wrong, the employer can terminate their contract as long as they have proper reason for the termination.

Can You Change At-Will Employment Status?
In the United States, all work is at-will employment unless otherwise specified. If the employee and employer agree to a specific work contract, then the at-will status can be changed.

Benefits of At-Will

At-will employment benefits both parties. An employee can leave the company at any time, without having to fulfill a specific time period. Employers can let their staff go if they have staff changes that need to be made, without being forced to pay a severance pay or face a breach of contract. With at-will, the employer does not have to provide the employee with any reason for their termination, which gives employers broad discretion as to how employees are handled.

Exceptions to At-Will Employment

There are exceptions to the at-will rules. Plus, every state has their own separate exclusions to the rule. Therefore, employers should consult with their employment lawyer in San Antonio before assuming they can terminate an employee. Some exceptions to the at-will employment rule include:

• A termination that violates Federal discrimination laws – such as terminating an employee because of their gender, age, handicap status, pregnancy, race, religion, etc.
• A termination that violates a state employment or public policy.
• A termination after a contract was created to change the status away from at-will employment.
• A termination after a Good Faith and Fair Dealing arrangement was made.

Consult an Employment Lawyer

Sometimes you do not need a written agreement for an employee’s status to no longer be at-will. If there is any implication that the employee is no longer at-will, terminating them could result in severe legal consequences. Therefore, you should consult with your employment lawyer San Antonio before terminating your employees. To better protect yourself, your attorney may have you create employment contracts with your staff.

Did You Include Digital Assets in Your Estate Plan?

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These days more consumers are operating online rather than in-person. From online bank accounts to shopping to social media; there is a lot of you on the internet. Unfortunately, estate planning laws are behind the times and unskilled attorneys may forget about your digital assets – which include online banking, investments, bill pay accounts, social networking sites and even your online passwords. If you were to pass away without including these digital assets in your estate plan, it may be difficult for your beneficiaries to fully manage your estate.

How to Protect Your Digital Assets

• Create an Inventory – First, gather as much information regarding your digital assets as you can. That includes listing all usernames and passwords, creating a list of what you have stored on your computers, software you use, online accounts, social media accounts, etc.
• Decide Who Handles Your Digital Assets – Digital assets do not have to be handled by your executor, especially if your executor is not tech-savvy. You can list someone separate to manage all online accounts, social media profiles and sites. The individual you select not only needs to be tech-savvy, but someone you trust to handle your family’s private information.
• Give Access – The person who represents your digital assets must be given access to them. You will need to provide them with passwords, pin numbers and usernames, but do so with caution. Remember you are giving this person full access to your accounts; therefore, you must trust them. Also, protect the information by putting it with your estate plan in a fire-safe security box.
• Give Instructions on How Digital Assets Will be Handled – Your estate planning lawyer needs to know how you want your assets handled. Do you want all social media accounts closed down upon your death? Or, do you want them to remain active as a living obituary? Give clear instructions on how you want each digital asset handled, and specify what you want deleted, saved, etc.

Discuss your digital assets with your estate planning lawyer. Make sure these assets and the individual responsible for them are included in your estate plan. If you have not created a will or trust, have your estate planning attorney do so. By protecting your digital assets, you can protect your family’s well-being and image both in-person and online.

Tips for Starting a Successful Home-Based Business

Home businesses are growing fast. They have low overhead, quick startup and an opportunity for an individual to be their own boss while comfortably working from home. If you are thinking of starting a home-based business, you need to do some research first. Starting a business, even from home, requires a few legal steps that cannot be skipped. And, if you want to get your business off to a great start, you may want to consult with a business attorney in San Antonio to see if there are any special considerations – depending on your type of business.

Pick Your Niche

You have a reason for starting your business, known as the niche market. Perhaps you are selling custom stationary or you are a freelance writer – each has their own industry and niche market. You must choose which industry you are getting into not only for marketing purposes, but for classification when you file for a business license, insurance and even a home use permit. If you plan to branch out into separate fields, you may want to create a separate business rather than mesh multiple industries together into the same business.

 

Become Familiar with Taxes

Home-based businesses are not free from taxes. You may have to file taxes as a sole proprietor, which means your business income is directly tied to your personal finances. If you incorporate, you may be able to file your taxes separately. Keep in mind that as a self-employed individual, you will pay the self-employment tax, which could take away a good portion of your monthly profits.

Check on Zoning

Zoning commissions in your area may ban the use of your home for a business. Most cities and counties will require you obtain a home-use or home business permit. If zoning laws prohibit you from starting a home-based business, you will not be able to get a permit. Some counties may require that you do not meet with clients in your home, but you can still work out of your home. Have your business attorney in San Antonio review the zoning laws to ensure you’re in compliance.

Hire a Lawyer

While you may assume a home-based business doesn’t need legal assistance, you would be surprised. Home businesses are subject to different rules, taxes and other legal considerations that are not as easily spelled out as opening a storefront. A business attorney San Antonio can help you incorporate, draft contracts and ensure you are in complete compliance with federal and state laws regarding home businesses.

Taxes That Could Affect Your Estate

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Taxes still happen even after death. Unfortunately, because estate taxes are constantly changing, even if you plan for taxes your estate plan may fall short 10 years later. That is why it is important to hire a skilled estate planning attorney San Antonio that stays on top of new estate tax laws and helps you update your will to account for those changes. 

While your estate planning attorney will know which taxes affect your estate, you should do your due diligence and understand the common taxes and how they will affect your heirs.

Gift Tax

Gift taxes are frequently ignored and shouldn’t be. They can affect your heirs significantly. As of 2014, the IRS exempts $14,000 in gifts each year, but once you give over $14,000, the remainder can be taxed. Taxable gifts must be reported on a tax return, which your estate planning attorney in San Antonio can assist you with or you can visit your local CPA.

Federal and State Estate Taxes

In 2014, the federal estate tax was $5,340,000. Most likely, this amount will be extended for several years; therefore, as long as your estate is not valued over this amount, it is not subject to federal estate tax.

Some states, however, impose their own separate state-based estate tax. But, most states are slowly phasing this out.

State Inheritance Tax

Depending on where you live, you could encounter a state inheritance tax too. If assets are passed to a charity or a spouse, they are exempt from the state inheritance tax. But, children and other individuals will have to pay inheritance taxes if they live within the six states currently using this law. If you reside in Texas, but your family members reside in a state that imposes inheritance tax, you will want to speak with your attorney about any issues this may cause for their own state tax return.

 

How to Hire the Right Patent Trademark Attorney

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Getting proper protection for your intellectual property starts with hiring the right patent trademark attorney. Your attorney drafts your patent applications, offers you advice, and helps you through the process – which takes two to three years. But, even after it is complete, your patent is only as strong as the attorney who drafted it. Which is why it is imperative you start with the right patent trademark attorney.

Not All Attorneys are Patent Experts

Not all attorneys understand the complex laws of intellectual property – let alone patents. Even if an attorney is registered with the U.S. patent office, they may not be skilled in the industry you’re filling a patent for. Therefore, you need to perform your own due diligence before selecting just any lawyer to handle such an important task.

The Attorneys Background

Patent attorneys have a background in hard sciences – such as physics, chemistry or biology. They may have a background in engineering, computer sciences, etc. But, it is important to pick a patent trademark attorney that has a similar background to the product you are trying to patent. By doing so, you can ensure that the patent is written to the industry and specifics regarding your invention.

Experience

You will want to go with a patent attorney that has been in the business for several years and has done several successful patents. An attorney that is new to patents or one that rarely files them may not be up to date on the latest changes or have a track record of success when it comes to patent applications.

Independent Patent Searches

While it isn’t always required, you do want an attorney that can do ample research before filing your patent. After all, you need to make sure no one else has already filed a similar patent.

Customer Service Skills

Lastly, you want a patent trademark attorney you feel comfortable with. You will work closely with this individual for several years; therefore, you want someone you can talk to, who understands your project, and is there to help you.

Going Through Mediation? What You Need to Know

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Civil mediation is a form of dispute resolution that helps two parties resolve a civil lawsuit without going to court. It can save your company time and significant resources, but it is only effective if you understand the process and purpose of mediation. If your company is going through mediation, ensure your business dispute lawyer is there for every step of the process. While you could go through mediation alone, an attorney can ensure your case is accurately represented and that the court-appointed mediator makes the proceedings fair.

When Can Mediation be Initiated?
Mediation can be requested at any time. There are times both parties may agree to mediation before a lawsuit is even filed, while other times it is after the formal complaint is made. Court can demand mediation, while other times one or both parties can request it. If the courts feel your civil case can be resolved without a trial, they may require mediation in hopes you can come to an agreement.

Once mediation is accepted, your business dispute lawyer will file the necessary papers with your county.

The county will then determine which mediation service to appoint for your job, though they may already have a list of approved mediator services on their county website.

Selecting the Mediator for Your Case

Both parties have a say in which mediator is used. They must select a neutral mediator, typically a third party that is an attorney or retired official. The mediator then hears both parties’ arguments, examines their evidence, and works to negotiate an agreement between each party.

Mediation does not have to be done with just one individual. Parties can elect a panel of mediators or a single mediator. A panel, however, is often selected by the courts and the participants are selected at random.

Going thru Mediation

Plaintiffs are responsible for scheduling the mediation appointments. They will select a time and place for the mediation and they must give the other party enough notice to prepare their case. Most mediations are required to be completed within a specified timeframe, which is assigned by the court. You do not have to speak to the mediator directly; instead, your business dispute lawyer will handle all mediation and negotiations on your behalf. You can, however, be present for the mediation.

Mediation is an ideal option for businesses that want to resolve a lawsuit before it goes to court. As long as you have an open mind and you are open to negotiations, you may find you save more money and time with mediation. It is best to discuss the option of mediation with your attorney before deciding it is right for you. While it is advantageous, there are certain situations where mediation is not necessary or going to trial may be in the best interest of your case. Therefore, let your attorney examine the facts and determine if mediation is right for you.

Are You Prepared for a Lawsuit?

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No business wants to be sued, but in today’s climate, it is bound to happen the longer you are in business. It does not mean you are at fault or that you even deserve to be sued, but there may come a time where a disagreement arises or a dissatisfied customer decides it is better to sue than discuss the situation with you.

As a business owner, you must be prepared for a lawsuit in the future. By being organized, keeping notes and following the law, you will not only make it easier on your business litigation lawyer to represent you, but you can thwart false lawsuit attempts.

Have a Calendar and Use It

A calendar is an important defense against a lawsuit. While it may not seem that way, a calendar can establish a timeline that will help you defend your business in court. For example, you have a client suing you for breach of contract for not completing the work on time. Your calendar could prove that you did in fact complete the work as agreed, what you did on that final date, etc.

Also, in your calendar entries you should write down every detail, such as who you are meeting with, the time, the reason for the meeting and a few notes on what was said.

Write Down Conversations

Do not assume you will remember every detail in every meeting or conversation you have. Instead, you need to record your meeting notes and keep them in a safe place. When recording these notes, be sure to include:

• The subject of your conversation
• Who was present for the conversation
• Any risks, concerns or other issues that were brought up
• If there was an agreement made or if you and the other party disagreed

Keep All Drafts and Previous Contact Copies

It will help your business litigation lawyer if you have all earlier contracts and even the drafts. While the drafts may not be the final copy, they do show a timeline of how your agreement changed, what alterations were made, etc.

Keep It All in Chronological Order

Even if you have all the right documentation, you need to keep your client files in chronological order. This will make it easier for your attorney to scan the documents and even refer back to the periods your client or business partner is suing you for.