Category: Business Law

  • Starting an Arizona LLC – Here Are The Forms You Need

    Four Seasons Resort & Spa in Scottsdale, Arizona by Daniel Spiess
    Four Seasons Resort & Spa in Scottsdale, Arizona by Daniel Spiess

    Starting a business in Arizona is fairly straightforward process. It requires paperwork and money. That sounds simple enough until you look at the Corporation Commission’s website of forms. It can be a challenge to figure out what forms you need to submit. If you don’t do it right the first time, the Corporation Commission will make you do it again. If you want to create a manager-managed LLC in Arizona, here are the forms you’ll need. (There is an option to create a member-managed LLC, but I never advise client to do this, and here’s why.)

    Cover Sheet – You need to include this cover sheet every time you send something in to the Corporation Commission.

    Articles of Organization – This is the main application for starting a business where you have to state the name and address of the company, whether it’s manger or member-managed, who is the statutory agent. The instructions sheet will tell you about some of the limits regarding your company name and answer other common questions.

    Manager Structure Attachment – You must include this with your Articles of Organization and list all the managers who own 20% or more of the company. If you think this is basically a repetition of a lot of the information from the Articles of Organization, you’re right.

    Statutory Agent Acceptance – An LLC can be sued. Your statutory agent is the designated person who will accept service on behalf of the when the company gets sued. You can be the company’s statutory agent. It doesn’t have to be a third party, but you could hire someone to be your agent if you wanted. You must submit these forms and your filing fee to the Arizona Corporation Commission to start your business.

    You have the option to pay an additional fee to expedite your application, but in most cases that is not necessary. You are allowed to act as if the business exists when you submit your paperwork to the Corporation Commission.

    Remember one of the benefits of having an LLC is to protect your personal assets in the event that the business is sued. If you set things up correctly, only the business assets will be on the line, but to do this you must keep your corporate veil intact.

    If your plans for 2014 include starting a business, you may also want to check out this post – How to Start a Business in Arizona. If you want to chat with me about this or any other topic, you can connect with me on Twitter, Google+, Facebook, YouTube, LinkedIn, or you can email me. You can also subscribe to the Carter Law Firm newsletter. Please visit my homepage for more information about Carter Law Firm.

    •

    Ruth Carter

    •

    , , , , , , , , , ,

  • Can You Trademark a Hashtag?

    Rémi Beaupré, Meme Snippets, 2012 by Retis from Flickr (Creative Commons License)
    Rémi Beaupré, Meme Snippets, 2012 by Retis from Flickr (Creative Commons License)

    I spoke at TechPhx on Social Media Horror Stories from the Legal Trenches. One of the stories I told was Turner Barr’s experience with having his blog, Around the World in 80 Jobs, essentially shut down because another company registered the trademark in the same name. At the end of my talk, someone asked if you could register the trademark in a hashtag.

    A trademark is the words, slogans, logos, colors, packaging, etc., you put on your products that differentiate you from your competition. If you don’t register your trademark, you get the exclusive right to use your marks where you’ve established your market. When you register your trademark, you get the exclusive rights to use your marks on your type of products everywhere in the U.S. If you want to know more about trademarks, check the story behind the Burger King trademark.

    Hash Tags are Like Snow Flakes by cambodia4kids.org from Flickr (Creative Commons License)
    Hash Tags are Like Snow Flakes by cambodia4kids.org from Flickr (Creative Commons License)

    Just like you can register a trademark in a company name, product name, or slogan, you can register a trademark in a hashtag. The first rule is your trademark can’t be the generic product. If you own a coffee shop, you can’t register the trademark #coffee. If the U.S. Patent and Trademark Office (USPTO) let you have that, you could stop your competition from calling their coffee “coffee,” which would be very confusing. You could register your business name (i.e., #DansCoffee) or a slogan like #GreatMornings or #WheresMyMug.

    The second rule is you can’t claim a trademark that your competition is already using. If you were a soda manufacturer, you couldn’t register the trademark #Coke or #CocaCola unless you were the Coca-Cola Company.

    Another thing to keep in mind is when you register your trademark, you have to declare what you’re claiming as your trademark and what goods or services you’re using it on. You only get the exclusive rights to your mark in your arena of goods. You can’t stop another company from using a similar trademark on their products as long as they are completely unrelated.

    Registering a trademark allows you to prevent your competition from using your trademark or something similar to it. It doesn’t give you the ability to stop people from using your slogan in their everyday lives. For instance, the Williamstown Theatre Festival could register the trademark in the hashtag #WTF which would allow them to prevent other theatres from using the same hashtag to promote their products, services, and events, but it would allow them to stop everyone who uses it on Twitter to mean “What The Fuck.”

    Registering a trademark is a long process. It can take months for the USPTO to look at your application and then there may be several rounds of communications between you and the USPTO before your trademark is approved. If you want to claim the exclusive right to use your desired hashtag, it should be for something that you’re planning on using for a long time.

    So can you register a trademark in a hashtag? Yes. Should you register your hashtag as a trademark? It depends on your situation. That should probably require a joint meeting with your marketing staff and your lawyers. If you want to chat with me about this or any other topic, you can connect with me Twitter, Google+, Facebook, YouTube, LinkedIn, or you can email me.
    You can also subscribe to the Carter Law Firm newsletter.
    Please visit my homepage for more information about Carter Law Firm.

    •

    Ruth Carter

    •

    , , , ,
    , , , , , , ,

  • How To Use Event Photos for Marketing Purposes

    Notice Posted at the Arizona State Fair - October 27, 2013
    Notice Posted at the Arizona State Fair – October 27, 2013

    I get hits on this website every day from people who are searching for terms like “posting photos online without permission” and “privacy expectations in public filming.” I also get questions from people who want to know whether and how they can use the photos from their events to market their businesses.

    The general answer is you can use photos and videos you take at your events but you should put your guests on notice that you are doing this by posting a sign at the registration table for the event. If your event has tickets, you may also want to put this notice on there as well. If your guests do not want to be photographed or videotaped, they should not attend the event.

    There is no guarantee that your guests will notice the sign or read it, but if it’s a big event, you can’t be expected to get each guest’s verbal or written consent to possibly being on film. The best you can do is make the information readily available and in a place where they are likely to see it.

    I saw a photo/video notice recently at the Arizona State Fair. They had a few A-frame signs throughout the fairgrounds that contained this notice. (Sorry about the shadow.)

    1027131445

    I’m a dorky lawyer so I read the sign, but I’m sure the majority of the thousands of people who were there didn’t. However, by continuing to be at the fair, they consented to being photographed and videotaped. If anyone sees themselves on the fair’s website or promotional materials, there’s nothing they can do to stop it.

    From a business owner’s perspective, most people aren’t going to care if you use a photo of them from your event on your marketing materials. If a person is at your event, they probably like your company and it’s highly unlikely that an event photo will become the main image for a company. It will be a picture in a brochure or a supplemental photo on the company’s website. Most people would be flattered to be featured in this way. The notice is to protect businesses against the rare angry person.

    I also made a video about this topic. You can see it below or here.

    If you want to chat with me about this or any other topic, you can connect with me on Twitter, Facebook, YouTube, LinkedIn, or you can email me.
    You can also subscribe to the Carter Law Firm newsletter.
    Please visit my homepage for more information about Carter Law Firm.

    Lights Camera Lawsuit

    There’s always a need for quality legal information for photographers. That’s why I created an online course called Lights Camera Lawsuit: The Legal Side of Professional Photography to address photographers’ most important questions. I want you to feel secure in your business, confident in the way you operate day-to-day, knowing that you’ve set yourself up to get paid what your worth without incident.

    For less than the cost of hiring a lawyer for two hours, the course contains nearly six hours of legal information you can immediately apply to your business!  

    Please subscribe for more information and to make sure you don’t miss out on any special offers or discounts.

    •

    Ruth Carter

    •

    , ,
    , , , , , , ,

  • Coming to Arizona in 2015: B Corporations

    voting or shopping by photologue_np from Flickr (Creative Commons License)
    voting or shopping by photologue_np from Flickr (Creative Commons License)

    An exciting bill was approved by the Arizona legislature this year that will allow people to create B corporations in Arizona starting in 2015. (Apparently it will take them until then to update the Arizona Corporation Commission website with the forms and information.)

    Benefit corporations, or B corporations, are like other businesses except that they have “higher standards of corporate purpose, accountability, and transparency.” In other corporations, the people in charge have an obligation to make the most money for their shareholders, and if the shareholders believe that management isn’t doing that, they can sue the company. In a B corporation, the company has other motives for being in business besides maximizing profits and the shareholders are on board with that plan. These are companies like Patagonia and Ben & Jerry’s.

    B Corp CertifiedEarlier this year, I attended a seminar organized by the Arizona Tech Council on B corporations where we learned about some of the benefits of having B corporations in your community. B corporations are 60% more likely to donate at least 10% of their profits to charity compared to other sustainable businesses and they are 18% more likely to use suppliers from low income communities compared to other sustainable businesses. These companies are four times more likely to give employees paid professional development opportunities compared to other sustainable businesses. In 2011, 95% of B Corps paid a living wage to all employees and were three times as likely to offer health insurance to all employees and have retirement plans.

    Until we have B corporations in Arizona, companies can become B-corp certified if they meet the B Lab’s “rigorous standards of social and environmental performance, accountability, and transparency.” There are at least four B-corp certified businesses in Arizona, including Goodmans Interior Structures and DIRTT Environmental Services. A business doesn’t have to have a higher social cause as its obvious purpose for being in business. Many small businesses who provide traditional goods and services can be B-corp certified.

    Over 600 companies have become or B-corp certified. If you want to learn more about B corporations including how to become B-corp certified, please visit their website. If you need help deciding whether you should become a B corporation or B-corp certified, contact your accountant or business attorney for assistance.

    You can connect with me on Twitter, Google+, Facebook, YouTube, LinkedIn, or you can email me.
    You can also subscribe to the Carter Law Firm newsletter.
    Please visit my homepage for more information about Carter Law Firm.

    •

    Ruth Carter

    •

    , , , , , , , , ,

  • What Happens to your LLC when you Die

    Headstone View by Augapfel from Flickr (Creative Commons License)
    Headstone View by Augapfel from Flickr (Creative Commons License)

    When you own an LLC or part of an LLC, you own property. This is property that will be part of your estate when you die. If someone came to me and said their business partner just died and they’re not sure what that means for the business, I would initially have two questions.

    • What does your operating agreement say in regards to this situation?
    • What does the deceased’s estate plan say happens to their portion of the business?

    Hopefully both of these documents exist and give clear instructions. If you don’t have an operating agreement and the person didn’t have an estate plan, their portion of the business will pass to their relatives like the rest of their estate per that state’s law. Most likely, if the person was married, their portion of the business would go to their spouse. If they didn’t have a spouse, it would go to their kids. If they didn’t have a spouse or kids, it would go to their parents.

    When I draft an operating agreement for LLC owners, I make them answer the hard questions like what happens if an owner dies or gets disabled and document their plans for addressing those situations at the beginning of their business relationship so they won’t be scrambling when they find themselves facing these issues.

    If you are a sole LLC owner, you don’t need an operating agreement that tells you how you’re going to run the business, but you may want one to thoroughly document what you want to happen to the business when you become disabled or die. Make sure you document the pertinent information like where keys, passwords, and bank accounts are so your employees or loved ones can take over or wind up the business.

    Once you have your estate plan and operating agreement in place, make sure you tell your family and whoever else may need to know where you put it so they can carry out your wishes. My Wills and Estates professor (who is a brilliant estate planning attorney) suggests you put them in a fire-proof and waterproof safe with the door unlocked (or the key in the lock). That way the documents are safe but if a thief gets into your business or house, they will quickly see that it doesn’t contain anything of value to them and leave it.

    It’s hard to think about what should happen to your business if you die. If you work in an industry (like law) where a person needs a specific credential to be an owner, you may not be able to keep the business in the family but they could be charged with closing down your operation. Otherwise you will have to decide if you want the business to go to a family member, an employee, or a combination of people. You ultimately won’t have control over whether the business continues to exist, but you can put the documents in place to try to make it happen.

    You can connect with me on Twitter, Google+, Facebook, YouTube, LinkedIn, or you can email me.
    You can also subscribe to the Carter Law Firm newsletter.
    Please visit my homepage for more information about Carter Law Firm.

    •

    Ruth Carter

    •

    , , , , , , , , ,

  • Ask the Hard Questions Before Starting a Business

    dock at dusk by Scott Ellis from Flickr
    dock at dusk by Scott Ellis from Flickr

    When business owners are launching their new venture, they can get so excited about launching the business that they don’t put the energy into making sure they have the structure of their business relationship laid out. Why would they want to do that? That sounds really boring and kind of a downer when you think about it.

    Even though it might seem boring or superfluous, people who are going into business need to have a meeting of the minds and address some of the hard questions that come with owning a business. It might be the first stressful conversation you have to have and it’s a good way to gauge how well your partner(s) communicate under stress. You might learn that they’re an irrational nutball when things aren’t smooth sailing and you don’t want to go into business with them.

    When I’m working with new business owners, here are some of the questions I throw at them to see how well they’ve thought through their plans.

    • When and how much will each owner get paid?
    • What happens if an owner gets divorced? Becomes disabled? Dies?
    • What are each person’s responsibilities? How much can each owner spend without getting the other owner(s) approval?
    • If the owners are deadlocked on a decision, how will you resolve it?
    • What should happen if an owner isn’t performing up to par?
    • What will happen if an owner wants out?
    • Under what circumstances can an owner kick another owner out of the company? What will the process be?
    • What’s the goal of the business, including the exit strategy?

    Ideally, these answers should be a part of the owners’ operating agreement if they have an LLC or otherwise documented in a master plan so everyone’s on the same page. Business divorces can be as messy as family divorces, especially when the owners didn’t figure some of these things out in advance.

    It’s much easier to deal with these questions when everyone’s happy and thinking about what’s fair and what’s best for the business than to wait until everyone’s pissed off at each other and looking for ways to get ahead or screw over the other owner(s).

    Before you start a new business, talk about the hard questions with your potential partners before you launch your venture and consider meeting with a business mentor and/or a business attorney to make sure that you’re setting yourselves up to be a success from all angles from the beginning.

    You can connect with me on Twitter, Google+, Facebook, YouTube, LinkedIn, or you can email me.
    You can also subscribe to the Carter Law Firm newsletter.
    Please visit my homepage for more information about Carter Law Firm.

    •

    Ruth Carter

    •

    , , , , , , , , , , , ,

  • News Reporter Shea Allen Fired because of her Personal Blog

    TV Camera on the grass by Simon Yeo (smjbk) from Flickr
    TV Camera on the grass by Simon Yeo (smjbk) from Flickr

    Shea Allen was a TV reporter in Alabama who has a personal blog. She was fired after she released a post of “No Apologies: Confessions of a Red Headed Reporter” where she, among other things, admitted she is “frightened of old people,” has “taken naps in the news car,” and that she’ll stop recording if you ramble and she deems you unnecessary for her story but let you think otherwise. You can check of her post for the full list. I’m not sure what to think of her statement that her best sources have secret crushes on her.

    Shea’s boss was not impressed and fired her because the post did “irreparable harm to the station’s image.” She did an interview about the situation with Keith Yaskin from The Flip Side Communications and shared her thoughts about what happened here.

    Shea doesn’t think that she should have been fired since the alleged inappropriate post appeared on her site where she’s sharing her personal views, and not representing the TV station and because she offered to take the post down once she became aware of her employer’s objections to it.

    The First Amendment protects Shea’s right to free expression; however the fact that her statements were not illegal is not enough to keep her boss from firing her, at least if she was an at-will employee. At-will employees can be fired for any legal reason, including the fact that your boss doesn’t like what you posted on your personal blog as long as what you wrote about isn’t protected (i.e., your gender, race, religion, disability, etc.)

    Keith hit me up for an off-the-cuff response interview and here’s what I had to say about bloggers like Shea being fired because of their blogs here.

    What about the statement that she was just being funny? I believe that was her intent; however blogging gives you a voice but not necessarily a voice tone. You can’t guarantee that what’s funny to you will be seen as such by others, especially when it’s your boss reading about things that you do at work that he/she may frown upon.

    I agree with Shea that her situation highlights a “gray area in social media.” It’s because of situations like this that every company needs a social media policy that provides clear dos and don’ts when possible but more importantly provides guidelines for employees when it comes to their online posts, whether they’re using the company’s social media accounts or their own. Companies should remind employees that their posts are permanent and that they should treat each post like a digital billboard that millions of people might see.

    I also think that Shea’s confused about the limits of the freedom of speech. It applies to everyone in the U.S., but it doesn’t protect you from all the consequences that may occur because of what you said.

    If you want more information on this topic, please check out my newly revised book, The Legal Side of Blogging: How Not to get Sued, Fired, Arrested, or Killed.

    You can connect with me on Twitter, Google+, Facebook, YouTube, LinkedIn, or you can email me.
    You can also subscribe to the Carter Law Firm newsletter.
    Please visit my homepage for more information about Carter Law Firm.

    •

    Ruth Carter

    •

    , , ,
    , , , , , , , , , , , ,

  • How to Avoid Screaming Matches in Coffee Shops

    Office Cleaning Prank Played On Janitor In Frederick Md from Flickr
    Office Cleaning Prank Played On Janitor In Frederick Md from Flickr

    When you and a friend have a great idea for a new business, you create an LLC.

    When you create an LLC, you get super-excited about your new venture.

    When you get super-excited about your new venture, you forget to put in the business infrastructure behind the scenes.

    When you forget to put in the business infrastructure behind the scenes, you and your partner may have different ideas about how you’re going to run the business.

    When you and your partner have different ideas about how you’re going to run the business, you get frustrated with each other.

    When you get frustrated with each other, you get into screaming matches at coffee shops.

    Don’t get into screaming matches at coffee shops.

    Get an operating agreement at the beginning of your business relationship.
    This will make sure that everyone is on the same page and you can predetermine how you’re going to address certain problems before they arise.

    You can connect with me on Twitter, Google+, Facebook, YouTube, LinkedIn, or you can email me.
    You can also subscribe to the Carter Law Firm newsletter.
    Please visit my homepage for more information about Carter Law Firm.

    •

    Ruth Carter

    •

    , , , , , , , , , , , ,

  • When’s the Last Time You Reviewed Your Contract Templates?

    Inspiration as Commodity by exquisitur from Flickr
    Inspiration as Commodity by exquisitur from Flickr

    I had the pleasure of speaking to the Photographer’s Adventure Club last week. In addition to discussion the basics of copyright and how to protect their rights in their work, we talked a lot about the importance of contracts.

    I know the subject of contracts makes a lot of people’s eyes glaze over – it’s that fine-print-legalese-crap-that-no-one-reads-anyway stuff. A lot of people think contracts are boring and a lot of contracts are . . . but they don’t have to be.

    I love contracts. They create the basis of so many relationships – whether they are written, oral, or pieced together through a series of emails. Too often people come to me with a question about a problem in one of their professional relationships and when I ask, “What does your contract say about this?” the answer is “I don’t know” or “We don’t have a contract.” We can still resolve the problem but we could have avoided a lot of headaches and frustration by putting everything on paper in advance so everyone’s on the same page from the beginning.

    Having contract templates is often the best way to create the relationship with others that you want. In regards to photographers they should have a file of contract templates for clients who hire them, for other photographers when they have to hire an additional person to work a shoot, a copyright license for publications, a model release, and a location release. And contracts don’t have to be long, complicated, or riddled with crazy legalese to be effective. I prefer to write contracts in straight-forward English and I wish more of my legal counterparts would get on board with this idea.

    And contracts can be fun. Recently I saw an episode of Man v. Food where Adam Richman took on the Hellfire Challenge at Smoke Eaters – 12 wings covered in crazy hot sauce. Before he could begin the challenge he had to sign a waiver that required the person signing to acknowledge that “I am an idiot.”

    You can put almost anything you want in your contract as long as it isn’t illegal. And if you downloaded your contract templates off the internet, that’s not a bad place to look for ideas, but you should at least consult an attorney to make sure it suits your needs before you start using it. If the contract is valid and you sign it, you’re stuck with the terms so you want to make sure you’re not opening yourself up to get screwed over.

    If you need additional information about the minimum you need for a valid contract, please check out my video below or here.


    If you want to chat about your contract needs, please send me an email or contact a business attorney in your community.

    You can also connect with me on Twitter, Google+, Facebook, YouTube, and LinkedIn.
    Please subscribe to the Carter Law Firm newsletter for additional information about running your business more effectively. Please visit my homepage for more information about Carter Law Firm.

    •

    Ruth Carter

    •

    ,
    , , , , , , , , , , , , , ,

  • How Work Made for Hire Contracts Work

    Photographer Devon Christopher Adams at Ignite Phoenix #10, photo by Joseph Abburscato used with permission
    Photographer Devon Christopher Adams at Ignite Phoenix #10, photo by Joseph Abburscato used with permission

    If you have ever hired a third party to do photography, video work, web design, graphic design, or to create website or marketing materials for your company, you should check your contracts. If you didn’t draft it correctly, there’s a good chance you don’t own the copyright in what they created.

    When you hire a freelancer or a company to create this type of content for you, you need a work made for hire contract. This contract should state that the person being hired is a contractor (not an employee) that they are being hired to create a works made for hire, and that you will own the copyright in everything they create under the terms of the contract. This contract needs to be in writing and signed before the contractor begins work on your project.

    If you don’t do this, you will not own the copyright in the work. You will only have an implied license to use the work in ways specified in your verbal or written agreement. The contractor will still own the copyright in the work. If you repurpose the work in another way without the contractor’s permission, there’s a chance that you will be infringing on the contractor’s copyright. The contractor could sue you for copyright infringement or force you to buy another license to use the work. They could offer to sell you the copyright in the content too, which basically means, from your perspective, you’ll have to pay for the same work twice.

    I work with companies and freelancers on both sides of this issue. I encourage companies to make sure they have a proper works made for hire in place with their contractors and to not let their contractors lift a finger until that contract is signed. I often suggest that they have provision in their contracts that states the contractor will indemnify the company against any infringement claims made against the company because of the contractor’s work. The company should make the contractor cover the attorneys’ fees and any damages if it turns out the contractor ripped off someone else’s work instead of creating the work themselves.

    On the flip side, I frequently write contract templates for freelancers to ensure that they understand what rights they are retaining and which ones they are giving up. Many freelancers want contracts that give the hiring party the copyright in their work and that also give the freelancer a license to put a copy of their work in their portfolio so they can use it to obtain other jobs.  Without this license, the contractor can’t use their work in any way without risking violating the copyright that the company now owns, even though they created it.

    If you are a freelancer or a company who hires third parties to create content, please contact a copyright attorney to make sure your rights and interests are protected by the terms of your contracts. You can connect with me on Twitter, Google+, Facebook, YouTube, LinkedIn, or you can email me.

    You can also subscribe to the Carter Law Firm newsletter.
    Please visit my homepage for more information about Carter Law Firm.

    •

    Ruth Carter

    •

    , ,
    , , , , , , , , , , , , , ,