Conflicts of Interest in Small Businesses Conflicts of interest arise often in small businesses, so identifying them and having a policy in place to prevent them are crucial. Generally, a conflict of interest refers to a situation where a principal in the business, such as an officer or director, [...]
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 [...]
Risks and Rewards of Taking a Political Stance for You and Your Business Businesspeople today often take political stances and air their views in the news media, but doing so may negatively affect their businesses. When considering whether you or your business should express political views to the public, [...]
California Business Licenses and Permits: Which Ones Do You Need? Nearly every business needs some kind of business license or permit to operate. Which licenses you need may vary depending on your location, type of business, products sold, customer base, and more. In California, the state government runs some [...]
Do You Owe a Duty of Care to Investors in Your Business? Many California business owners owe duties of care to their investors under California law. Generally, the duty of care requires business owners to act in good faith and in the best interests of the business. It is [...]
Professional Corporations in California Californians employed as professionals and seeking to start a business should consider incorporating as professional corporations. You may have seen the initials “P.C.” at the end of a doctor’s office or lawyer’s firm name, which indicates that the firm is a professional corporation. Professional corporations [...]
California Startups Must Disclose Financial Information to Shareholders Many startups organized as private corporations keep the value of corporate shares a well-protected secret. Telling the public that share values have soared in recent years or that they recently dropped after a new product announcement could greatly affect a company’s [...]
Introduction to Privacy and Business Ownership Many first-time business owners worry about the privacy of their personal information. For a savvy entrepreneur, running a business does not have to mean disclosing everything about your life to the public. Instead, use a variety of legal, financial, and common sense strategies [...]
Payment of Finder’s Fees for Securities Sales in California California’s new law permitting payment of finder’s fees to middlemen in securities purchases creates new business incentives within the state. However, the law contradicts a long-held Securities and Exchange Commission policy against finder’s fees. Essentially, California has legalized payment of [...]
Employment Contracts for Savvy Techies Who Want to Hit It Big Technology companies who want to make it in an already cutthroat industry can gain an edge by learning what to look for and what to include in employment contracts. Negotiating salary and starting a new position mean plenty [...]
How Can I Prevent Employees from Leaking Ideas? “Loose lips sink ships.” This common saying describes the fate of businesses whose employees, either inadvertently or on purpose, share ideas with others without permission. Competitors may learn of the ideas or even pay employees for them and then use them [...]
My Investor Is Being Too Hands On. Is There Anything I Can Do? Investors getting very involved in the business can cause problems for business owners who want to retain control. On one hand, without the investor, the business would not have the money to fund its operations. On [...]
What to Promise Investors and What to Keep to Yourself If You Want to Stay Out of Court Promoting your business to investors could land you in court if you run afoul of the detailed and complicated California and federal laws surrounding sale of securities. This post focuses on [...]
I Don’t Need a Lawyer to Start a Corporation - Or Do I? Many new business owners start out forming a corporation with the idea that they can do all the paperwork themselves and save on legal fees. It is true that the California Secretary of State provides a [...]
Changing Your Startup’s Product Midway Through - and How It Could Cause Legal Troubles If you work for a startup, you know that your target audience’s needs can change on short notice, and so you may need to adapt your product or service to fit the market. You may [...]
Examples of Biotechnology Agreements and Why They are Important The growing biotechnology industry can be a minefield of legal issues for scientists and the companies they start, seeking to protect their investments and grow their business. One common topic that every biotech founder should consider is how to prevent [...]
What Is the Difference Between Federal Securities Laws and California Securities Laws, and How Do They Apply to Me? Both the state of California and the federal government have laws about securities on the books, but the two sets of laws differ significantly. Federal and California securities laws cover [...]
Protect Your Business from Data Security Breaches After hearing about the many data security breaches in the past few years, you may have wondered how breaches can be prevented, either at a business you own or the ones you patronize. Though hackers are becoming more sophisticated, smaller businesses need [...]
Beginning a Business Relationship with a Vendor In the rush to court a new vendor, companies may be tempted to quickly sign a standard form agreement and begin work immediately. If you find yourself caught up in the rush, take a step back, properly investigate, and negotiate your relationship [...]
Fair Use of Copyrighted Material Generally, the owner of a copyrighted work has the exclusive right to reproduce, distribute, perform, and display the work, and to prepare derivative works based on it. 17 U.S.C. § 106. Fair use is a broad exception to this exclusive right. It allows the [...]
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 [...]
California Law on Non-Competition Agreements In California, both a state statute and numerous court decisions say that non-competition agreements are not enforceable, and delving into the reasons why can help business owners understand how to work around needing them. The term “non-competition agreement” generally refers to a contract between [...]
How Does the San Diego City Business Tax Affect Me? Businesses operating in the city of San Diego, California, must obtain a business tax certificate and pay the city business tax. San Diego Municipal Code § 31.0101, et seq. The law applies to any person engaging in a business [...]
Out-of-State Corporations in California Corporations that are incorporated in another state and are doing business in California should be mindful of compliance with California law. For example, out-of-state corporations must ensure they are properly registered to do business, that they familiarize themselves with laws regarding company employees working in [...]
Can I Use Electronic Signatures on a Contract? Whether you can use electronic signatures to bind parties to a legally enforceable contract in California depends on the parties’ agreement and the method of signature. Be careful to fulfill the below requirements, or a court might find that the agreement [...]
Insurance Basics for New Business Owners The current litigious business climate makes obtaining appropriate insurance a must for new business owners. Insurance can help cover the costs of a burglary, an injury to an employee, or some lawsuits, among other liability situations. Paying the insurance premiums now does not [...]
