Business Insights

  (c) for purposes of imposing liability on any member or manager of a limited liability company for the debts, obligations or other liabilities of the company, a court shall consider only the following factors no one (1) of which, except fraud, is sufficient to impose liability:     (i)    Fraud;     (ii)   Inadequate capitalization;     […]

Generally speaking, the sooner you incorporate, the better. The liability shield is not created until the company is incorporated. You may have what is called “promoter” liability (personal liability) for pre-incorporation obligations, even if those are ratified by the subsequently incorporated entity. With that said, end of the year incorporating is another issue. Should you […]

Which decisions are made by or require ratification by the members by simple majority (> 50%), supermajority (≥ 75%) or unanimous decision (100%)? Below is a list of some powers to consider addressing in your Delaware LLC Operating Agreement to determine who has the authority to engage in certain “big deal” transactions: Acquiring or selling […]

This business structure is referred to as “brother-sister” entities (as opposed to “parent-child” or subsidiaries). In this example, the assets of the real estate holding business and the fitness business are insulated from the liabilities of each other. If a customer claims they were injured while using the exercise equipment owned by ABC Fitness Management […]

According to the US Copyright Office, “Copyright protects original authorship fixed in tangible form.” This means that once filed, a copyright gives the claimant the exclusive right to publish, distribute and reproduce specific text, artwork, music, audio/visual material, etc. A person or company can only hold copyright to something if it is in a recorded […]

There are a few key areas of debate this committee is attempting to resolve, but chief among them are: What are the default rules pertaining to relationships with third parties (process servers, foreign state qualification, etc.) Can a series “spin off” into a separate entity? Should this be a stand-alone act, or amended to be […]