California Businesses: Yes, You Can Limit the Right to Sue Generally speaking, business contracts serve two purposes - one, to effectuate your deal and, two, to limit your risks and legal liability as much as possible. One of the best ways to limit your legal liability is to obtain [...]
Selling a San Diego Business: What is Your Duty to Disclose? Selling a business in San Diego is a complex and time-consuming process. Your skilled and talented business lawyers, like the ones at San Diego Corporate Law, have drafted and redrafted the sales contracts. Now everyone is in the [...]
Data Breaches and Data Protection for San Diego Businesses Every successful business should have a website and a web presence. Along with the positives of e-commerce, there come many responsibilities. We wrote recently about how businesses must keep their websites in compliance with the American Disabilities Act and two [...]
Who is a "Director" With Respect to Your San Diego Corporation? In general, San Diego corporations are run by a Board of Directors. The Board meets regularly to make important, strategic decisions. Among those decisions are hiring a chief executive officer ("CEO") and then authorizing the CEO to run [...]
Six Mistakes to Avoid When Running the Family Business A family-owned and family-run business in San Diego should be treated as seriously as any other business. In San Diego County, California, there are six mistakes to avoid when running your family business. Failure to Get Permits, Licenses, and Registrations [...]
Who can Sign Contracts for My San Diego Business? Most business contracts are made in writing and, occasionally, the question arises: Who can sign contracts for my business? In short, the answer is owners and anyone who the owners authorize to sign contracts on behalf of the business. In [...]
What is Vicarious Liability? In San Diego, businesses are liable for the acts of their employees when the employees are working. In general, employees are agents for their employers and all principals can be held liable for the acts or omissions of their agents when conducting the business of [...]
How is a San Diego "Fiduciary" Different from a San Diego "Agent"? In San Diego and all across California, businesses and even ordinary people hire and retain agents. Think, for example, about buying a house. You go online or make phone calls and hire a real estate agent. That [...]
What is a San Diego Joint Venture? Under California law, a joint venture is a type of general partnership. Like a partnership, California case law defines a joint venture as an undertaking by two or more persons or entities to jointly carry out a single business enterprise for profit. [...]
San Diego Corporations: The Importance of Board Minutes Many California corporations know that meetings of the Board of Directors are required at least once a year. However, some may not recognize the importance of board minutes. Here is a brief discussion of why board minutes are so important. To [...]
Expelling a Member of a San Diego LLC: You Should Revise Your Operating Agreement When you start your new business, everything seems perfect. But times change and now you have this troublesome member of your LLC. You ask yourself: How do I expel a member of my LLC? As [...]
Brief History of the LLC Have you been wondering: Should I form a corporation or an LLC? Here at San Diego Corporate Law, we can help you decide which type of entity will best meet your needs, and for many people means forming California limited liability companies ("LLC"). A [...]
Family Businesses: A San Diego LLC is a Good Choice Family-run businesses are unique and have their own special needs. Forming a San Diego limited liability corporation ("LLC") can help by: Protecting the family assets Clearly identifying management responsibilities Providing for succession of management Estate planning Family businesses are [...]
E-Commerce and the Need to Incorporate As we here at San Diego Corporate Law have written on several occasions, there are many good reasons to incorporate. However, when contemplating starting a global e-commerce business or expanding your existing business into global e-commerce, incorporating is essential. There are just too [...]
Tips for Starting Your Own San Diego Holiday Pop-Up Shop The holiday season is upon us. Along with everything else cheery and bright, the holiday season brings an infusion of pop-up shops. Some San Diego bars are converting to themes for the winter holiday and New Year’s and national [...]
Is Reverse Corporate Veil Piercing Allowed in California? In August of 2017, in the case of Curci Investments, LLC v. Baldwin, 14 Cal. App. 5th 214, the California Court of Appeal for the 4th Appellate District approved a reverse piercing of the corporate veil. This is new law, since [...]
San Diego Law: What is the Business Judgment Rule? (Part I) The business judgment rule provides personal immunity to directors of a corporation from being sued by the shareholders and/or investors if a decision made by the directors turns out to be a bad one. The business judgment rule [...]
San Diego Startups: What's in a Business Name? When you think about starting up a new business, the first thing most people think of is a name. Usually, people choose a name for the business that is special to the people starting the business. Maybe something about father and [...]
What is New with California Social Purpose Corporations? On October 11, 2011, to great fanfare, California enacted the Corporate Flexibility Act of 2011 creating two new corporate forms called “flexible purpose corporations” and “social benefit corporations.” In 2014, those were combined and renamed as “social purpose corporations.” The [...]
What is a California Limited Partnership? In simple terms, a California limited partnership is a partnership with one or more partners who are "limited" in terms of management and liability. A California limited partnership can be best understood in comparison to a California general partnership. California General Partnership: [...]
What is a California General Partnership? A California general partnership is a simple and intuitive concept. When two or more people own and operate a business without a formal corporate structure, they are a general partnership. Put another way, a California general partnership is very similar to a [...]
What is a Fictitious Business Name? When you conduct business in California under any name other than your name or the exact name of your California corporation or California LLC, you are operating under a “fictitious business name.” For example, if you incorporated as "ABC Smartphone Store, Inc.," [...]
Can a California LLC Have an Oral Operating Agreement? Sometimes, new business owners are leery of forming a California Limited Liability Company ("California LLC") as opposed to a California corporation or California partnership because they are daunted by the need for an operating agreement. Most good operating agreements [...]
The Importance of a Custom-Drafted Operating Agreement for a California LLC California Limited Liability Companies ("LLCs") are governed by their operating agreements. California LLC operating agreements do not have to be formalized or even in writing (however, it is a good idea to do so!). The California Corporations [...]
Basic Differences and Similarities Between a California Corporation and a California LLC When forming your California corporate entity, you have many options including forming a California corporation or creating a California limited liability company (" California LLC"). Most people are familiar with the idea of how California corporations work [...]
When Businesses Owners Face Personal Liability for Corporate Actions Directors and officers of a corporation who participate in or personally direct tortious conduct can be found personally liable, rather than being shielded from liability by the corporation. To be personally liable, the director or officer must “authorize, direct, or [...]
The Advantages of Limited Partnerships Limited partnerships offer many advantages over other entity types, especially for businesses in which one partner wants to provide funding but not run the business on a daily basis. A limited partnership differs from a standard partnership because it has at least one general [...]
Director and Officer Liability in the Corporation Corporations shield their directors and officers from liability for corporate actions, unless a director or officer personally directed or participated in tortious conduct. See, e.g., Frances T. v. Village Green Owners Ass’n. (1986) 42 Cal.3d 490, 503-504. The term tortious conduct refers to [...]
Which is the better business entity: sole proprietorship or corporation? Entrepreneurship is an exciting journey. It’s a dream put to action on your own terms. The possibilities feel endless — and they are. That being said, a lot goes into starting your business. Entrepreneurs early on should think about [...]
How long will it take to form my corporation? Entrepreneurs, including those who have created a tech startup in the state of California, should consider forming a corporation as their business grows. But before you get started, it’s important to understand the timeline and process involved. Let’s say, for [...]
Tips for Forming the California Joint Venture A “joint venture” has been defined as, “[a] legal entity in the nature of a partnership engaged in the joint prosecution of a particular transaction for mutual profit…” A one-time grouping of two or more persons in a business undertaking. Unlike a [...]
What is a Registered Agent? When forming business entities, the term “registered agent” is frequently used, and there are many registered agent services available for hire in each state. So what does a registered agent do? In California, the term generally refers to the “registered agent for service of [...]
Tips for Preparing the Operating Agreement in California Pursuant to California Corporations Code Section 17701.10(a) the limited liability company’s (“LLC”) operating agreement “governs all of the following: (1) Relations among the members as members and between the members and the limited liability company. (2) The rights and duties under [the California Revised Uniform [...]
How Can I Ensure my Corporate Name is Available for Use? After deciding to incorporate your business, one of the first steps of incorporation is to decide upon a legal name for the business. For each prospective name, it is important to determine whether the name you have chosen [...]
What is a Certificate of Limited Partnership? In California, the Uniform Limited Partnership Act of 2008 (California Corporations Code Sections 15800, et seq.) governs the creation limited partnerships. Pursuant to California Corporations Code Section 15902.01(a), to create a limited partnership, the partners must first enter into a partnership agreement, then [...]
What is a 501(c)(3) Corporation? Many times we hear radio and television advertisements seeking contributions in which a claim is made that an organization is a “501(c)(3) corporation.” These advertisements generally tell the listener to check with his or her tax advisor to determine whether donations are tax deductible, [...]
Should I Incorporate my Business? Many people go into business for themselves every day, and many of them have a limited knowledge on the protections a corporation can provide. Typically, until they have some need for additional operating capital or are being sued by an unhappy customer, they seldom [...]
What are The Liabilities of a Limited Partner in California? In California the Revised Uniform Limited Partnership Act of 2008 codified in California Corporations Code Section 15900, et seq., “which became fully effective January 1, 2010” The Uniform Limited Partnership Act of 2008: Text, Drafters’ Comments, and Correlation Tables, Continuing Education [...]
Does Your Partnership Agreement Need to be Updated in Light of the IRS’ New Audit Regime? On November 2, 2015 the Bipartisan Budget Act of 2015 (the “Act”) was signed into law by President Barrack Obama, which will significantly affect the audit rules for entities treated as partnerships for [...]
Using the California Limited Liability Company to Acquire Real Estate In California the Limited Liability Company (“LLC”) is a hybrid business; it is an entity that has the attributes of both the general partnership and the corporation. While the members of an LLC enjoy the freedom of management that [...]
How and When to Wind-Up Your California Corporation Winding-up and dissolving a California corporation is governed by the provisions of California Corporations Code Sections 1900 through 1907. How that process takes place depends largely on whether the corporation has ever done business or issued shares or whether a “voluntary [...]
The Social Purpose Corporations Act and How to Use It California’s Social Purpose Corporations Act allows entrepreneurs wishing to combine for profit businesses activity with the achievement of a social purpose. The corporation is formed by the traditional filing of Articles of Incorporation which state that the corporation is [...]
2013 Changes for California Business As of January 1, 2013, the California Secretary of State’s office has some new legal requirements applicable to business entity documents. The changes were legislated under California Senate Bill 1532 and apply to documents filed on or after January 1, 2013. [Read the [...]
LLC vs. Corporation for Equity Crowdfunding The traditional debate for promoters of start-ups when choosing which entity to utilize has been confined to three (really four) choices: sole proprietorship/partnership, S-Corp, or LLC. In most instances, each of these forms has allowed for initial losses to be passed through to [...]
Avoid LLC Pitfalls BEFORE FORMING AN LLC WITH AN ONLINE SERVICE, MEET A LOCAL ATTORNEY. THE CHEAP LLC YOU ARE THINKING OF BUYING FROM AN ONLINE SERVICE MAY NOT BE THE MOST INEXPENSIVE OPTION AVAILABLE. • Avoid spending HUNDREDS OF DOLLARS PER YEAR for registered agent services. • [...]
Starting a New Business Starting a business begins with planning. However, once the plan is in place, the plan must be executed. Below are the ten steps you will need to execute to transform your business idea into an operating business. #1. Write a Business Plan A well written [...]
