Articles Tagged with “sacramento small business lawyer”

Business owners have many obligations. They have to consider their obligations to customers, to employees, to vendors, and sometimes even to law enforcement. One set of obligations that sometimes gets overlooked, however, is a business’s obligations to the public at large. One such obligation may come in to play when a business is considered a public forum. So the question becomes, when is a California business obligated to allow other members of the community to do things like solicit donations at their business? A recent court decision addressed that very question.

Shopping Center Policy on Solicitation

The Court’s decision was in a case called Donahue Schriber Realty Group, Inc. v. Nu Creation Outreach. The realty group controls the Fig Garden Village shopping center, which is an outdoor shopping center with about sixty retailers. The shopping center has a policy that prohibits the solicitation of donations on shopping center property. Other forms of expressive activity, like collecting signatures for petitions, are allowed but only in a designated “public forum area.” One day, back in 2013, two solicitors for Nu Creation Outreach went to the shopping center and solicited donations for their organization on sidewalk areas adjacent to store entrances within the shopping center. The next day six to eight solicitors from the organization showed up and started soliciting donations. Shopping center representatives explained the policy and asked the solicitors to leave, but they refused. The shopping center then called the police, but the police refused to arrest the solicitors without a court order.

While our state legislators here in California regulate businesses to a great extent, the federal government also passes laws that affect small businesses, especially those that do business in multiple states. Therefore, when you start a small business of your own it is important to keep track not just of the goings on in our state legislator, but of those of Congress as well. One relevant bill Congress is considering now is the “Small Business Hardship Relief Act.” The bill is sponsored by Rep. Raul Ruiz from California’s 36th congressional district.

What is the Small Business Hardship Relief Act?

The name of the bill certainly makes it sound good, but it is not all that descriptive. This can be fairly common in federal legislation as well as legislation in some states. In the case of this bill, the hardship relief in question actually has to do with the Affordable Care Act, also known as Obamacare. The bill, if passed, would amend the Internal Revenue Code. It would exempt businesses that have no more than 100 full-time employees and are experiencing a “hardship” from the Obamacare mandate that they provide minimum essential health care coverage for employees. In other words, such businesses would not face a tax penalty for failing to provide the required health care to their employees. “Hardship,” however, does not just mean any sort of difficulty. A “hardship” is defined by the bill as a situation where:

A recent federal court ruling offers a good reminder of the many unique claims that may be made against employers by their unhappy employees. All Sacramento business owners–from established enterprises to start ups–should be familiar with their risks before trouble arises.

The Situation

Shaw Rahman was employed by Crystal Equation, a staffing company that assigned him to a job with AT&T. Rahman signed more than one document that specifically described his employment as “at-will,” and stated his employment could be terminated at any time.

On September 21, 2013, California Governor Jerry Brown signed into law the California Revised Uniform Limited Liability Company Act (commonly known as the RULLCA), codified at Cal. Corp. Code §§ 17701.01-17713.13. The law is scheduled to take effect on January 1, 2014. The RULLCA will entirely replace the Beverly-Killea Limited Liability Company Act (referred to for purposes of this article as the “old law”), which has governed California limited liability companies (LLCs) since 1994. An LLC is a hybrid legal entity that has both the characteristics of a corporation and of a partnership. An LLC provides its owners — referred to as “members” — with corporate-like protection against personal liability, but it is treated as a noncorporate business organization for tax purposes.

The RULLCA will apply to all existing LLCs and LLCs formed under the laws of California after January 1, 2014, as well as to all foreign LLCs registered with the California Secretary of State as of January 1, 2014. The law revises certain rules governing the formation and operation of LLCs in the state of California. Below, we will highlight some of the significant changes promulgated by the new law.

While much of RULLCA is similar to existing law, it includes some important changes. First, while the “operating agreement” still serves as the foundational contract between LLC members, under RULLCA, the operating agreement does not need to be in writing. Additionally, unless specifically expressed in the operating agreement, an LLC will, by default, be managed by the members; if an LLC wishes to establish management by a manager or managers, it must be expressly stated in the operating agreement.

It is important for owners and operators of commercial real estate to stay current with applicable laws and ordinances, including the Nonresidential Building Energy Use Disclosure Program (the “Disclosure Program”). The Disclosure Program — better known as Assembly Bill 1103 or AB 1103 — requires owners, brokers, and property managers of commercial real estate, i.e., “nonresidential buildings in California,” to disclose energy use or “benchmarking data” to potential buyers, lessees, and financiers prior to the sale, lease, or financing of a whole building. The purpose of the Bill is to promote energy efficiency in California.

AB 1103 requires nonresidential building owners and operators to input energy consumption and other building data into the Environmental Protection Agency’s ENERGY STAR Portfolio Manager System, which generates an energy efficiency rating for the subject building. Ratings are from 1 to 100, with 100 being the most energy efficient. A building achieving a score of 75 or higher can apply for ENERGY STAR certification. ENERGY STAR Portfolio Manager is an online tool created by the EPA and used to measure and track energy and water consumption, as well as greenhouse gas emissions. It can be used to benchmark the performance of one building or a whole portfolio of buildings.

AB 1103, passed in 2007, was scheduled to go into effect on September 1, 2013, for buildings of 50,000 square feet or more, however, this summer, the California Energy Commission announced that it was delaying implementation of the program until January 1, 2014, because of ongoing technical issues with the Portfolio Manager tool. Beginning on January 1, 2014, the owners and operators of commercial buildings are required to disclose to potential buyers, lessees, and financiers, the building’s energy data and rating of the previous year. The Implementation Schedule is as follows:

The Law Office of Kristina M. Reed has a strong reputation for providing results-driven client-focused legal services to individuals, property owners, investors, entrepreneurs, small to medium sized businesses, real estate agents and brokers, and property management firms. The law firm has been located in Downtown Sacramento since 2008, and has been an active part of the growth, revitalization, and redevelopment of that area. The firm provides small businesses and entrepreneurs with quality legal services at rates affordable to new businesses.

The Law Office of Kristina M. Reed is committed to small businesses and entrepreneurs, and a champion for the growth and revitalization of the Downtown Sacramento area. In keeping with these goals, the firm, along with other local businesses and organizations, recently sponsored the 2013 Calling All Dreamers Competition, an annual competition with the goal of fostering Sacramento’s entrepreneurial spirit and cultivate the next dreamers in Downtown Sacramento. Beginning in April, applicants submitted their businesses concepts for the competition. A panel of business experts selected eleven semi-finalists based on the following criteria: creativity, sustainability, and entrepreneurial passion. The panel then selected five finalists out of the eleven semi-finalists. The panel ultimately selected Andy’s Candy Apothecary as the winner. The candy store will carry packaged candies from around the world and well as locally-made handmade candies. Andy Paul, the founder of Andy’s Candy Apothecary, received a cash prize of $10,000 as well as free rent and business support services, including 10 hours of business and real estate related transactional legal services provided by the Law Office of Kristina M. Reed.

While starting and running a new business requires passion, it also requires confidence and a strong foundation. The Law Office of Kristina Reed provided Andy’s Candy Apothecary with a strong foundation, and we can help your small business as well. Many small businesses pay little attention to the legal side of their business, which can prove detrimental. An attorney experienced in assisting small businesses can help your business make key foundational decisions about the structure and organization of the business as well as developing strategies and making deals that will make your business successful. We can also help draft employment agreements and ensure that your business is in compliance with all relevant ordinances, such as zoning ordinances. Hiring an experienced lawyer up front to help your small business get off the ground can save you from headaches down the road. It can help protect you against expensive lawsuits brought by employees, customers, and suppliers.

Last November, Google began providing one-gigabit-per-second fiber optic internet service to homes in Kansas City, Kansas. These residents will be the first people in the world to test out Google’s new service. When Google first announced its nationwide Google Fiber project three years ago, over 1,000 cities and towns across the country applied for the chance to get the service, and Kansas City won. The new high-speed service carries data at speeds more than 100 times faster than the average American internet connection. One of the reasons Google chose Kansas City is because the city is home to many startups and tech-friendly organizations, such as the Ewing Marion Kauffman Foundation, the world’s largest foundation dedicated to entrepreneurship, which develops and generously supports numerous efforts to provide entrepreneurs the knowledge, skills, and networks they need to start and grow businesses.

Not surprisingly, entrepreneurs have taken notice of the high-speed connection and Kansas City has become the epicenter of a thriving startup community. Three things make the high-speed connection so attractive to startups: (1) it is relatively inexpensive; (2) engineers are able to upload large sequences of data almost instantaneously; and, (3) startup founders and executives are able to easily and seamlessly video chat with investors and partners all over the world. And one neighborhood in particular has become a hub of startup activity. Hanover Heights, part of a the community that has been called the Kansas City Startup Village (KCSV), was the first neighborhood in Kansas City to receive access to Google’s high-speed internet, and the influx of startups and entrepreneurs that followed the installation has spawned what one venture capitalist has termed the “Homes for Hackers” program. The program offers serious entrepreneurs and their startups a rent-free home equipped with Google Fiber. Some startups have even purchased their own homes in KCSV in order to take advantage of Google’s high-speed internet connection and to foster an environment of collaboration.

Collaboration and sharing physical office space is particularly important to startups. While many businesses have been started and run successfully from anywhere in the world, startups are more likely to succeed in an environment where employees and/or founders are able to meet and interact in person. Google, Twitter, and Groupon are prime examples of startups that began in such a way. Risks of working remotely include, employees missing interaction with colleagues, employees becoming drained by extensive travel, and thus unhappy with their employment situation and more likely to be recruited by other companies.

This week, New Zealand voted to ban software patents, and the impetus for New Zealand’s decision seems to be the practice of patent trolling; the Chief Executive of New Zealand’s Institute of IT Professionals commented that the country would no longer tolerate “the vexatious practice of ‘patent trolls.'” Why does this decision matter to California start-ups and should the United States follow New Zealand’s lead? Answers to these questions will be discussed in the following article.

Coincidentally, New Zealand’s decision to ban software patents comes on the heels of a report issued by the Government Accountability Office (GAO) (“Assessing Factors that Affect Patent Infringement Litigation Could Help Improve Patent Quality”), which was discussed in an earlier blog article (“Patent Trolls Targeting Software Companies and Start-ups”) and which essentially concluded that patents on software do not work. Why don’t patents on software work? There are several reasons, including the sheer number of patents and poorly issued patents. In the past 20 years, the number of software patents has grown tremendously. In 1991, software patents made up less than a quarter of all patents issued by the U.S. Patent and Trademark Office (PTO); however, in 2011, the PTO issued more software patents than any other category of patents. Software patents also produce more litigation than any other category of patents because software is used so widely and because the patents issued by the PTO are often overly broad, unclear, and vague. The GAO points out in its report that another problem with software patents is that their complexity and rapid development cycle make researching patents impractical. This problem is particularly relevant to start-ups; because granted patents are often poorly crafted, it is impossible for entrepreneurs to search through them in order to determine whether or not they are infringing on another’s patent. The GAO interviewed representatives from software start-up companies, who confirmed this problem, explaining that “searching for relevant patents before developing new products is unrealistic and diverts already scarce resources, particularly because their product development process can be as short as two months.” The start-ups also advised the GAO that “they do not always apply for patents until their companies are well established because patents attorneys are expensive, and the process is time-consuming…. [T]he cost of [research and development] is low relative to the cost of applying for a patent, so there is minimal incentive in the software industry to patent in order to recoup [research and development] costs.”

Some experts believe that the United States should follow New Zealand’s lead and ban software patents because they do not promote innovation but in fact hinder it, as explained above. The difficulty with this proposal, however, is that while the patent system does not work well for software, it works well for other industries such as the pharmaceutical industry, where chemical patents are indexed and searchable by formula. These same experts point out that the United States Supreme Court’s decision this summer in Association for Molecular Pathology, et al. v. Myriad Genetics, et al., hints at the possibility that the high court may not be particularly fond of software patents. In that case, the Court ruled that human genes may not be patented because the patent included “well-understood, routine, conventional activity previously engaged in by researchers in [the] field.”

Google, Inc. is always on the cutting edge of enhancing and simplifying the internet experiences of the average computer user. Sometimes, however, Google comes up with unique ways to help a certain segment of the population. One such segment, comprised of brand new small business owners, is set to benefit tremendously from a new Google tool: “Google for Entrepreneurs.”Search_Engine_Optimization.jpg

Google realizes that starting and growing a new business venture is not as simple as hiring a small business attorney to prepare the entity formation paperwork. In addition to all the legal issues associated with startup, new business owners will eventually have to tackle marketing, product delivery, and intellectual property rights to transform what may be a solid concept into a viable and profitable business.

Google for Entrepreneurs features a toolbox full of resources. On the marketing front, Google provides a service through which small business owners can launch their very own professional website to market and promote their goods and services. Google+ for Business helps ensure that your particular goods or services are reaching the types of Google users who are most likely to be interested in them. Google AdWords provides a way for your business to promote itself in the side margins of a Google search when the potential customer searches for certain keywords that are similar to or related to the product or service you are trying to sell.

Most Sacramento small business attorneys are surprised by how infrequently single-person small businesses take advantage of the limited liability company structure for their small business. Some people are shocked to learn that a single person can do business under the protection of a limited liability company. After all, a limited liability company is very “official-sounding” and seems to elicit images of multiple business partners or large corporate status.

The reality is that a sole proprietor – one who operates a business without the actions or investments of others – can very easily enjoy the limited liability protection that an LLC affords, and they don’t need anyone else’s input to do it. The purpose of the limited liability company is to distinguish the individual human business owner from the business itself. This means that a person operating under an LLC cannot be sued personally for any acts or omissions committed by the person as long as he or she was acting within the course of business.

This concept is very important in that it distinguishes which funds would be available to a potential plaintiff in a lawsuit. If the business owner were to breach a business contract or cause a traffic accident while performing business functions, only those funds and assets that are tied to the business could be pursued. The owner’s individual assets would be protected. business-social-networking.jpg