Ask MetaFilter questions tagged with business and legal

How to not get screwed over in a business partnership.

giggleknickers — Sun, 15 Nov 2009 22:35:57 -0800

How does the tech person in a business partnership avoid getting screwed over by the business person? We are four people talking about starting up a small software development business. Three of us are software engineering students who know crap-all about business, and the fourth is an experienced businessman who is more or less going to take care of all the non-technical stuff. He will be our Steve Jobs to us three Steve Wozniaks.

I'm a little paranoid because I've read a lot about the history of various technological developments, and it seems that engineers and developers have a habit of getting screwed over by the businessperson they partner with. The businessperson uses their tricksy business skills to swipe the intellectual property and get all the money and credit while the developer is left wondering what on earth happened.

Am I overly paranoid from the history I've read or is this likely? How can I avoid it? We'll be working on a project that has been a long time dream of mine, so I feel very overprotective about it.

I'm trying to educate myself about this situation, but it feels like I need a degree in business, and another in accounting and another in law in order to understand everything I need to know to answer this question. It seems like a paradox, because if I knew enough to answer this question, I would know enough that we wouldn't need someone taking care of the business end of things in the first place.

Hang out the shingle or get more experience first?

Happydaz — Thu, 21 May 2009 12:10:50 -0800

I just graduated from law school on Sunday. I want to open my own law firm and practice criminal law after I pass the Oregon bar. But how can I get up to speed fast enough that I don't give my new clients poor legal services? I've been reading several books on starting your own practice. (Foonberg's 4th edition, How to Start your own Solo Practice and Succeed by Gerald Singer, and Solo by Choice.) But these books all focus on the business side of starting a law practice. Getting clients, running an office, whether you have the right personality to solo, etc. What I want to know is can I realistically become competent enough in criminal law that my clients aren't getting screwed while I learn the ropes?

I would really like to hear from anyone who has started their own law firm in any area of law. Did you start right out of law school or did you work for someone else first? What would you change if you could do it again?

What kind of records do most sole proprietors, freelancers and consultants keep?

Anonymous — Tue, 17 Feb 2009 19:39:33 -0800

What sort of state of organization are the financial records of most sole proprietorships in? I've had a small freelance business for about 15 years. About 3 years ago, I was in a car accident that was 100% not my fault. (The other driver admitted fault and there were witnesses.) I am now in the middle of legal dealings with my insurance company, because of the state of whiplash, the effect on my pregnancy and the effect on my ability to run my business and maximize earnings. (I do have a lawyer.) The insurance company is asking for all my financial records from the past nine years. They want copies of every receipt, invoice, mortgage interest statement, etc.

I've never kept a general ledger or anything like that. I just invoice and pay my expenses and credit cards and stuff like that. I've never been very formal about things, although I am excrutiatingly honest. I don't lie on my taxes. However, there have been situations where I just phoned the mortgage company to get the interest amount for my mortgage for the year (for business use of home), because I figured that if I got audited by the government, I would just phone and get a statement sent out. And, as I mentioned, I don't have cash flow statements or anything like that. And sometimes my receipts are in my name, my husband's name or both our names. But I always put money into our joint account to cover everything, usually lump sums throughout the year.

I had planned to incorporate and set up with an accountant, but, because of the car accident, I am just beginning that process now. Going forward, my records will be more diligent, since I'll be incorporated.

But, I'm wondering...what is the typical state of financial records for most freelance and consulting type businesses? My lawyer seems baffled that I have unaudited records...he's not used to sole proprietors. He seemed surprised that I had been doing my own taxes (for all but 3 of the total years, because, honestly, the accountants never got me any more tax back than I got on my own). For the most part, my business records are my personal income tax records, since the sole proprietorship income tax is part of that. I never saw any point to doing balance sheets and neither did the bookkeepers or accountants. Are other freelancers and consultants in a different situation? (Again, I'll be changing this going forward.)

Has anyone been convicted for murder where the motive was business?

arniec — Thu, 07 Aug 2008 09:13:53 -0800

Dick Jones from Robocop filter: Has there ever, in real life, been a convicted case of murder where a high profile, multi million/billion businessperson either killed or hired someone to kill a business competitor, either within the company or in another company? You see it all the time on Law & Order, Monk, and Robocop...a wealthy businessperson has a co-worker killed either to get a promotion, or revenge for being showed up in the boardroom, etc. But has this ever really happened? Has any rich businessperson caused the death of a business competitor (either a co-worker in the same company or another company)? Any recent cases?

(and I'm referring to legal, corporate businesses, not drug dealer businesses, etc)

If I work out of my apartment, will I be my only client?

pantheON — Wed, 27 Feb 2008 20:54:21 -0800

Can I run a criminal law practice out of my apartment? I'm in Toronto, Ontario, Canada. I'm currently articling (for my American friends, that's a mandatory one-year apprenticeship I have to complete to get called to the bar) at a mid-sized insurance defense firm. I've concluded that I want to get out of this area of the law and I'm interested in pursuing a career in criminal defence. I've been told that I'll likely have to take legal aid cases almost exclusively until I gain some more experience and can establish a full practice. My question is a narrow one: What are the practicalities of working out of my apartment until I can build a practice that can support office space. My apartment is in the business district of the city and about a 10 minute walk from the courthouses. Could I, for example, work out of my apartment, store my files there, and meet clients in public places?

Douche-Baggery at Work: How do we protect ourselves from future slander?

Anonymous — Fri, 22 Feb 2008 17:51:29 -0800

There's some serious douche-baggery going on at my job that cost one of my colleagues his job today. How do I protect myself? I teach at a University somewhere in America. At the beginning of this year, I took this job, and at the same time that they hired a new director. The director brought a couple of people with him (lower level staff members) who interact with students, and are generally bad medicine. Today, one of my colleagues got fired by the Provost because of lies and scandal that the Director of the program started about my colleague. He's lawyering up, and has been given until the end of today to either quit or be fired. He's obviously going to fight - but if he wins and gets to keep his job, he doesn't really "win," you know, without the support of the administration.

The level of scandal here goes deep. He's got budgets screwed up, our division is in shambles, and he shows favoritism and negative empowerment to both students and staff that are "on his side." Most of us have never been disrespected as badly as we have by this man and the people who he has wrangled up. He preys on the weak, undecided students and faculty/staff by giving them very positive praise and rewards, and then putting them together in situations where they are empowered to slander and trash-talk the rest of the people involved. It's a "Divide-and-Conquer" situation that is unacceptable in this environment, and especially in the educational arena.

Several of us have caught the Director in lies. He's very good at treating people below him like shit, and lying to upper administration to make himself look like the champ. Around Christmas of 2007, several of us were slandered by this guy at a public venue in front of students, staff, and other faculty - he has even gone so far as to scream "FUCK 'so-and-so'" in a crowded venue in an argument in front of students' parents and other patrons at an event. Our work environment has gotten very very bad, and it looks as though this guy might get to keep his job due to his manipulation of upper-level administrators, including the VP.

The major downfall of this situation is that this director is also a "professional" in the same line of business that many of us also work in. He's in the same professional union as some of us, so perhaps there is an avenue for protection there as well. The major problem is that, since this guy is a pathological liar and manipulator, he's gonna talk some shit to people we might both know, and spread more bullshit and lies about our work and our personalities. None of us are terribly worried about the damage that he's gonna try to perform, but it is a major pain in the ass (and potentially harmful to future contracts and work) if we have to explain the situation about this guy to people all of the time. He is an expert manipulator - and our colleagues, the heads of our division, and many other people directly and indirectly involved are shocked and awed at how successful he has been at getting what he wants via lies, slander, and manipulative tactics.

I have resigned my position, effective at the end of this school term. My question is about preemptive legal attack; does the Hive Mind see it beneficial for us, one by one, to contact our lawyers and have some kind of "If-I-Hear-That-You-Said-Shit-About-Me, I'll-Sue-Your-Ass-For-Slander" letters drafted? Is there such a thing, and are they effective? Is there anything else we can do to make sure that this guy keeps his lying mouth shut?

There's a chance that he will ALSO be terminated, but at this point, all bets are off. We never expected this guy's lies and manipulation of students to actually trick an administrator into firing one of the best and most influential professors/recruiters the division has ever seen. As you can imagine, this bullshit is all very, very political.

My spoof email for this question is bossdouche@gmail.com. Please drop me a line and post here if you have something that might help. Every day is another wonderfully effed up adventure.

Is it illegal for a business to close earlier than the closing time posted on their door?

thatgirl — Mon, 31 Dec 2007 20:31:13 -0800

Is it illegal for a business to close earlier than the closing time posted on their door? When I was a waitress in California (12 years ago), I remember one of my managers saying that it was illegal to lock the doors even slightly before the closing time posted on the doors. If we were closing at 10:00 p.m. and a customer wanted to come in at 9:59, we had to let them in and serve them.

In all of my years living in California, I can't recall a single instance when I found a business (such as stores, restaurants, banks, etc.) closed or closing before their posted closing time.

I live in upstate New York now, and this happens to me ALL THE TIME.

- Dunkin' Donuts: Found closed, dark, and deserted a half-hour before closing time.
- Dunkin' Donuts another time: Found the store closed an hour early, forcing me to get back in my car and go through the drive-through (which was not scheduled to close for another 2 hours), only to be told that they had no donuts left at all. I asked why and the girl told me that her manager had her throw them away an hour ago. (?!) All she could sell me was coffee.
- Pizza Hut: Tried to come in 45 minutes before closing, told they were closing the dining room early and we could only order to go.
- Price Chopper (tonight): Normally 24-hours, they were closing at 10:00 p.m. for New Year's Eve. We went in at 9:40 and were told somewhat rudely upon entry that they were closing in 10 minutes. As we were leaving 5 minutes later (9:45), they were no longer allowing customers in, stopping them at the door and telling them the store was closed.

These are just a few instances. There have been other stores, and other restaurants ("real" restaurants, not just drive-throughs and crappy pizza). In all cases, they have the business hours posted on (or near) the door. (Nothing where there were no hours posted, or where they said "Closing: Late" or anything like that.)

This has become a huge pet-peeve for me. (My husband has heard more than a few rants on the topic!)

Bad customer service aside, is it legal for businesses to close before their posted closing time? Are they any regulations regarding this sort of thing? Is there anyone I can complain to and get them in trouble with?

"Please don't start a similar business to mine elsewhere. It would hurt my feelings."

divabat — Fri, 21 Dec 2007 01:01:38 -0800

Can you really hold copyright to a business model/idea/concept, and disallow others from duplicating it? If not, then how is The Sampler able to do so? On The Sampler's (a company that collects samples of arts & crafts and distributes them to buyers who buy a random box at a time) FAQ, one question goes:

I love the idea of the Sampler! Can I create my own Sampler!?

The crafty community is full of all kinds of swap programs! Certainly you are welcome to create your own sort of swap, but please don't copy the Sampler outright! Using our concept and simply changing the name is still copying! Especially when you say things like "I'm starting my own Sampler" it's SORT OF A TIP-OFF.

The business model of the Sampler is something unique and something I've worked very hard to create, maintain and also very hard to defend! Though the Sampler is wicked fun and super friendly, please remember that it is still a business, and, as such, will be subject to and will appeal to all the laws that are applicable to defend it. The Sampler name, logo and the combination of the two are subject to US trademark laws.

Then in the Craftster forums, someone asks about starting her own Sampler to increase access to sample subscriptions, the original founder shows up and states that doing another Sampler would hurt her feelings as she said she "worked very hard" on the concept.

Does she actually have a right to be the only owner of a Sampler-type business? There are many companies doing gift-sample businesses (and The Sampler has provided gift bags for people like MTV), and there are many different types of fast food, of book stores, of hairdressers, etc etc. All essentially providing the same service. (One poster in that thread argues as such.)

What makes The Sampler different? Is it because it is in a relatively close-knit (excuse the pun) community where the target audience for such a product would be familiar with the original? Does Marie (The Sampler's founder) actually have any right under the law to sue anyone else that does a Sampler-type business? Does she legally have any leg to stand on?

What if I start a Sampler to, say, create and distribute samples for Malaysian crafters. Malaysians can't buy Samplers (they ship to limited countries) and there isn't such a thing here, so I start one. Would Marie be able to sue me considering her Sampler isn't actually in competition to mine?

I just don't see how it's possible for her to claim that The Sampler, nice idea that it is, is totally hers and no one can go and make their own Sampler deal. For one thing, I can't buy her Sampler, so if I want one I'd have to make my own! It also seems ridiculous to put a limitation on expanding the Sampler concept when there are also limits to who can contribute and which countries can purchase.

Have any other companies/industries gone through the same issues in terms of holding claim to business models? How has it been for them?

Legal requirements for an adult dating site?

treepour — Tue, 19 Jun 2007 17:11:55 -0800

I'm considering starting an adult internet dating service in the US. What legal implications do I need to consider? (Some mildly NSFW details follow). I'm considering creating a site for local gay/bi men BDSM enthusiasts to post/browse/search profiles, send private messages, etc. I know sites like this already exist but I'm hoping to create a small, low-overhead site that's both locally focused and low or no cost to end users.

I would, however, like for members to be able to post possibly NSFW pictures of themselves. On the one hand, I know that US recordkeeping requirements have become quite stringent. On the other, there are still a lot of personals and related sites -- not to mention craigslist -- that don't require one to submit two government-issued picture id's in order to post NSFW pictures of oneself.

Are sites in this latter category operating in a legal gray area? Or are there exceptions to the recordkeeping requirements for social networking, dating, or craigslist-like sites? Short of talking to a lawyer, are there any good resources for obtaining this sort of information in general?

How to structure group consulting business?

pallen123 — Sat, 02 Jun 2007 04:50:38 -0800

How should I structure a growing consulting business, with partners, collaborators, and others that I want to be invested in the growth and success of the business? I live in Ohio and am growing a consulting business providing new product development services -- design, development and marketing -- to small and large companies.

Right now it's just myself and an engineer (he manages a team of remote software and hardware engineers). He has his own corporation, through which he pays contractors. I myself have not subcontractors (in the past I've managed to get my clients to hire freelancers directly that otherwise I would have had to subcontract).

The engineer and I want to take on more clients and probably consolidate the business under one corporate entity -- and continue to leverage contractors.

My question is this... What's a good model for doing this, where the engineer and I are principals, but where we can also incent some key contractors with a higher level of ownership and/or profit-sharing?

What's the best structure and process of assessing monthly or quarterly *contributions* of non-principals -- and compensating them accordingly? Simply put, I imagine that in addition to the engineer and myself, there will be 1-2 key others that we'd like to extend some degree of ownership to -- so they share in ownership, should the business ever be sold, and also share in greater income security by being part of a group practice. One of these other contributors will be a designer and the other will be a project manager.

IANABM (I am not a business major), but...

Alterscape — Sun, 27 Aug 2006 18:32:24 -0800

What books and websites should a non-business-major read to learn about the legal and practical aspects of starting a small business partnership in the US (MD, to be exact)? An employer I've interned with recently offered me the right to "franchise" their business in my local area -- I set up a business entity with a couple of my co-interns; we license their name and proprietary technology to operate in our home state in exchange for a share of our profits. I don't have a business background, and want to learn what I need to know to evaluate this offer and make a decision about the profitability of such an endeavor. I'm looking for books, websites, etc, that cover the details that go into this -- lawyers and the issues surrounding their care and feeding, estimating overhead costs, market research, finding insurance, working out the legal details of hiring employees/payroll/social security/medicaid/etc, and anything else relevant. Basically, I need a crash-course in small business. Help me, hivemind!

If I write a book about what I do for a living, will I get in any trouble?

pman78 — Tue, 28 Feb 2006 20:31:49 -0800

I'm thinking of writing a business book. My dilemma is that the topic would be about what I do in my current day job. Let's say (for instance) I 'train' people in something very specialized for a living. I'm very good at it and I think people would be interested in my experiences to help them 'train' better themselves. Nothing proprietary would be revealed; mostly just process, lessons and 'tips to be successful'. I could use a psuedenoum as the author name if need be. My issue is around ethics and legalities. Am I in any muddy/gray areas here and if so am I likely to get nailed?

Online legal-ese?

nyterrant — Sat, 01 Oct 2005 14:07:22 -0800

Is there a good online source for generic legal-ese? I am starting a business and I need to draft corporate bylaws, stock certificates, and a terms of service agreement. I would like to do this without involving a lawyer, if possible. The entity will be a New York state S corporation, I need the TOS for a subscription-based online newsletter to be distributed worldwide.

How to keep people from suing my start-up business

acoutu — Fri, 23 Sep 2005 11:08:20 -0800

BusinessLiabilityFilter -- Do we need product liability insurance for our start-up mail order business that sells repackaged craft supplies to kids? My husband and I are looking at starting a business that offers craft kits for kids by subscription. We'd take basic supplies -- a few pipecleaners, string, paper, stickers, sandpaper, whatever -- and provide instructions for making a craft. These supplies can be purchased at any craft or dollar store or even Wal-Mart. We wonder if we create a liability for ourselves, such as if a kid stabs herself with a pipecleaner. We were planning to include a note that says parents are best able to determine age appropriateness of crafts -- and we're gearing our kits to four- to eight-year-olds. If we are potentially liable, we want to know the best way to protect ourselves -- incorporation, insurance or something else. We're in Canada, but would sell 90%+ to US customers, if that helps. Thanks.

Cash the check or no?

Anonymous — Sun, 21 Aug 2005 07:47:11 -0800

I'm a freelance web developer who was recently fired by a client, had the amount of my invoice debated, and decided, for a couple of reasons, to write it off as a loss and tell them not to pay me anything. Today I got a check in the mail; do I cash it? Here's the background: the client was a person who has a line of products she makes herself, and wanted to set up an online store to sell them. The design part of that was already taken care of, and I was contracted solely to build the site. I surveyed the requirements and recommended an e-commerce solution, and she decided to go with it. As I was getting ready to put the site together, I was asked if I could set it up on a different platform instead, as she had found an all-in-one service she liked the look of, which would provide hosting, content-management with a cart, etc. I expressed hesitation, thinking it wasn't nearly as flexible as what I'd recommended, but in the end agreed to it, figuring I could work around any limitations in the system. That was my mistake.

Fast forward a little ways; I've mentioned while working on the site that there are a couple things that can't be done exactly as originally planned, but when she first sees the site she's extremely upset that it's not exactly what she'd expected (the particular hangup was a lack of one bit of functionality in the store system which, after consideration, I told her could probably be worked around given a few extra days). I was thanked for my time and told that someone else would be contracted to finish the project, and asked to submit an invoice for my time on the project.

About a week after invoicing, I received an email not from the client, but from someone identifying as her business partner. This person stated that, due to my "misrepresenting my abilities" and "providing bad advice", they would not pay the full amount of the invoice, and offered an amount equal to roughly two-thirds. I wrote back and pointed out that I had originally recommended a different system and had indicated that the particular problem they had with the final choice could probably be worked around. I also indicated that I would ask for no payment. There were really two reasons for this:

1. They weren't happy, and my background is in customer service. So I decided that the best way to make them happy again, or at least somewhat happier, was to relieve them of having to pay me for something they didn't feel was what they'd asked for.
2. With words like "misrepresentation" flying around, there's always a chance it'll end up in court. I took this job because it was a friend of a friend, and did it on a handshake rather than my usual contract which specifies how disputes like this will be handled. Dumb, I know, but I figured that if by some chance it did turn into legal action, my refusing payment would hopefully be evidence of good faith and an attempt to minimize any perceived losses/damages on their part caused by whatever they tried to accuse me of.

I did, however, ask that someone I had contracted to do some Flash for the site be paid in full for his work, as it was completed to spec. I also sent along copies of all the HTML templates and stylesheets I'd created and images I'd sliced up, along with a note explaining where I'd inserted templates into the store system and pointing out that the files I'd sent them could easily be used to implement the workaround I had suggested (which I'd described to the client before being terminated from the project). The "business partner" responded and said that this was more than acceptable, and that the Flash guy would be paid.

Today I got a letter, not from the business partner, but from the client, expressing that she did not feel I had misrepresented anything or acted in bad faith, and that while she appreciated my not asking for payment she felt I was entitled to some compensation. Enclosed was a check for roughly one-third of what the total invoice would have been.

So now I'm in a quandary. The letter is pretty unequivocal, stating that she doesn't feel I misrepresented anything or that I acted in bad faith, so I should be covered legally. Given that, should I cash the check? Or would it be best to speak with an attorney first?

How to start a business from a hobby

Leud — Thu, 18 Aug 2005 06:46:31 -0800

Help a bunch of idiots start a business maybe - advice required on how to go about it. We (a motley crue of 12 adults) have been running LAN parties monthly for 18 months. We averaged 25 attendees but are now ramping up due to a surge in interest to 60-80 people. We are concered about legal implications as these are not free events, we charge a small fee to cover costs and supply networking equipment - We're sourcing a new venue and gaining sponsership from local businesses. Do we need to register as a company? Non Profit org (We funnel all profits *so far* into new equipment for the lan) or something? What about legal implications/insurance if someone gets hurt etc? How do we do whatever it is we need to do? This is in the UK for legal issues.

What prepaid legal service would you recommend for business matters?

newgrl — Sun, 07 Aug 2005 13:33:40 -0800

What prepaid legal service would you recommend for business matters? I'm starting a new business and need legal help on various matters, most importantly the contracts that are starting to flood over my desk.

I've done some research on various companies which provide small business legal advice but its hard to tell which ones would provide more services or which ones would be more responsive.

So I'd like to hear about your experiences with these companies and which ones you would recommend.

This thread DOES comment on pending litigation

fourstar — Wed, 29 Jun 2005 14:47:15 -0800

When did the practice of refusing to comment on a given issue due to pending litigation become an acceptable response? Is this a fairly recent development -- a result of living in a sue-happy nation? Is it just the vogue rhetoric of avoiding even a minimal amount of accountability? Or is it something else? For the lawyers out there, what are the ramifications of commenting? ... especially with cases like those involving the government?

PayPal me my taxes.

Orkboi — Sun, 16 Jan 2005 13:14:14 -0800

I am running a free Web-based service for friends and acquaintances. Lately, the volume on this service has been growing greatly. The next step is to move the service to a professional host. I am thinking of putting a paypal donation button on the site to help pay for it. Are there any legal or tax issues I need to worry about? Do I need a business license? What if I want to start selling Cafe Press items or running Google ads? I am located in the USA.

Taxation and Reporting for eCommerce

lilboo — Thu, 12 Aug 2004 08:31:41 -0800

Ecommerce filter: Here at work we are attempting to understand/define the default business rules for taxation calculations within an ecommerce app. Specifically we are all tied up in knots over the application of rates, reporting issues, etc. Is there an industry standard for handling this aspect of a transaction? Who defines the standards, and how can I find out more about it?

Starting a very small business.

shotsy — Thu, 29 Jul 2004 17:56:01 -0800

I am thinking of starting a very small business, but I have a few questions for those of you who have done so before I really make up my mind wheter to go forward or not. [More Inside] I'd like to start selling original t-shirts over the web, essentially. My goal is not to get rich, just to get a little extra change and also to get some t-shirts I'd want to wear. Hobby meets Cash. I've looked over some of the previous threads on setting up small business, but none seemed to quite address my questions.

A bit about my plan: Start with small runs, maybe 50 prints each of two designs, see how they sell, then react accordingly.

1) I've looked into the process and there are a lot of custom printers out there, and if anybody has experience in that area, I'd appreciate a reccomendation.

2) Taxes: I don't see myself making all that much money on this venture, but I don't want to play games with Johnny Law, so I am wondering how difficult figuring this stuff out will be. Do I need to officiate myself as a company or anything?

3) Advertising: I'd love to hear the good and bad stories of internet advertising. How does it usually work? I'd obviously target sites that cater to people with similar aesthetic ideals, but I'd love to get a rough (or very rough) estimate for how much I should expect to budget for that sort of thing (though I understand it will vary wildly by site).

4) Any other tips on things I haven't thought of would be appreciated.

I realize I've thrown a lot out there, so please just answer parts if you can. Many thanks.

Intellectual property question

blueshammer — Mon, 03 May 2004 08:22:22 -0800

AskLegalFilter: As a sort of follow-up to this thread, some friends and I have invented a game and have started to show it to representatives from game companies. There's been some interest, and before we can think about moving forward, I think we have to start with the legal stuff on our end. What sort of legal entity do my friends and I need to become so that someone can license intellectual property (mostly writing, as opposed to a unique style of play) from us and write us checks? And how can we do it for the least cost? Assume that we're more or less equal partners (somewhere between 33/33/33 and 35/35/30).