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What is a Speech-Language Pathology Professional Corporation?
Licensed practitioners who specialize in language and speech pathology are permitted to form professional corporations here in California. The statutory authority is set forth in the Moscone-Knox Professional Corporation Act (the “Moscone-Knox Act”). See Cal. Corp. Code, §13400 et seq. Like all types of corporate entities, a speech/language pathology corporation is formed by filing articles of incorporation with the California Secretary of State. A speech language pathologist treats, measures, tests, screens, evaluates, and provides counseling related to the development and disorders of speech, voice, language, or swallowing. See Cal. Bus. & Prof. Code, § 2530.2. Speech-language pathology — and audiology — are regulated by a subdivision of the California Department of Consumer Affairs.
Pursuant to California law, a professional speech language pathology corporation has certain naming requirements that must be met when the corporation is formed. These name options include “speech therapy,” “speech correction,” “speech correctionist,” “speech therapist,” “speech clinic,” “speech clinician,” “logopedics,” “logopedist,” “communicology,” “communicologist,” “aphasiologist,” “voice therapy,” “voice therapist,” “phoniatrist” or any similar titles. When forming a California professional corporation to operate your speech language practice, you must use one of the foregoing terms in the name of your corporation. See Cal. Bus. & Prof. Code, § 2530.3. Consult with your experienced San Diego corporate attorney to ensure that the name you want for your professional speech therapy corporation is compliant.
It is often better to form a speech-language pathology corporation than to operate your practice as a sole proprietorship. The corporate form protects your personal assets from being seized by business creditors and creating a California professional corporation greatly facilitates adding licensed partners to your practice. The corporate form shields each of the partners from liability that may be alleged against the other(s). If you have questions about the requirements of forming a professional speech language pathology corporation, or whether a corporation is the best entity type for your situation, reach out to a trusted corporate attorney experienced in working with speech language pathologists.
When forming your professional speech-language pathology corporation, you need to retain an experienced San Diego corporate attorney to provide advice and assistance. There are special rules under the Moscone-Knox Act with respect to who may be shareholders — owners — in your corporation. Likewise, there are limitations on who may be on the board of directors and who may serve as senior management. In terms of owners, at least 51% of the ownership must be held by licensed speech-language pathologists. The remaining ownership — up to 49% — can be held by licensed audiologists. No other persons may be shareholders in your corporation. See Cal. Corp. Code, §13401.5(d). A professional speech-language pathology corporation is unique in this way. Many California professional corporations can have licensed medical doctors, nurses, and other healing arts practitioners as owners. That is not the case with professional speech-language pathology corporations. In a similar manner, only licensed speech-language pathologists may be elected to the board of directions and only they may serve as officers and professional employees of the corporation. The corporation may have other employees — such as a receptionist or a book-keeper — who are not licensed as a speech-language pathologist as long as those employees are not providing any sort of medical/healing arts services.
Contact San Diego Corporate Law Today
For more information, contact attorney Michael Leonard, Esq., of San Diego Corporate Law. Mr. Leonard can be reached at (858) 483-9200 or via email. Mr. Leonard has been named a “Rising Star” for four years running by SuperLawyers.com. Mr. Leonard can ensure your professional corporation is set up correctly and can assist with the annual maintenance of your California professional corporation. Mr. Leonard provides a full panoply of legal services for businesses including formation of other types of corporate entities. Like us on Facebook.
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