Thursday, February 10, 2011
New Litigation Page on Website
I just developed and published on my website a page devoted to litigation. I explain my new revolutionary system of project management for business litigation. Click on this link: Litigation Page on Eric's website
Thursday, February 3, 2011
Monday, January 3, 2011
New model for business litigation.
I am thinking of an experiment in business litigation that could save considerable attorneys fees for business owners. Essentially, teams of contract attorneys would handle cases on an as needed basis. The client's documents and all documents generated by attorneys would be digitally stored and shared. The attorneys would be billed at considerably lower rate than prevailing rates. The teams would be managed on a project management basis by the lead attorney. The client would save considerable monies in attorneys fees.
My idea comes from a few sources. One is the fact that there is a lot of legal talent available that is unemployed or underemployed. My wife has been an attorney for a little more than a year and she knows a lot of attorneys who aren't working or working as contract attorneys.
The other inspiration is technology. The use of the Internet, including cloud computing and digital vaults make it possible for professionals, especially attorneys, to collaborate on projects without the need to be collocated.
The idea is to assemble a team of contract attorneys for each lawsuit. Each attorney would work on a particular project, such as research, drafting a pleading, discovery response, etc. as needed. Each project would have a deadline and a number of hours allotted to it. The case would be handled on a project management basis so that the client knows the cost in advance. The contract attorneys would be billed at a going contract rate plus overhead and a small profit. The lead attorney would bill at a higher rate. I am also considering billing the contract attorneys for cost during the course of the case with the client owing the remainder at the end of the case.
The key to the model is payment by the client. The client would need to make a commitment to pay a certain amount each month since the contract attorneys and the costs of the suit would have to be paid each month. This amount would be considerably less than the retainers paid monthly to dedicated litigation firms, particularly large firms. But, the client would need to understand and commit to pay.
Another key is that the contract attorneys would need to have to have strong writing and research skills. And, they would need to be able to work on a project/limited hours basis with little direct supervision. They would have to understand that they can't milk the file and, if a project was more difficult and might take longer, they would have to immediately communicate that fact to the lead attorney/project manager.
Documents, including client documents, would be cloud stored or stored in digital vaults. There is no need a lot of paper or attorneys collocated in a firm. Everything would be digital. Obviously, the lead attorney/project manager would have to have excellent communication and management skills. And, frankly, that attorney would have to be ruthless about contract attorneys who couldn't do quality work within a reasonable amount of time. Those attorneys would have to be cut out or, preferably, not hired in the first place.
I calculate that in a business litigation case, the project management model might reduce the attorneys fees by as much as 70% over dedicated litigation firms, particularly larger firms. That is a huge savings. I have discussed it with a few attorneys and they think it is a great idea. One even said that he didn't understand why someone wasn't doing it already.
My idea comes from a few sources. One is the fact that there is a lot of legal talent available that is unemployed or underemployed. My wife has been an attorney for a little more than a year and she knows a lot of attorneys who aren't working or working as contract attorneys.
The other inspiration is technology. The use of the Internet, including cloud computing and digital vaults make it possible for professionals, especially attorneys, to collaborate on projects without the need to be collocated.
The idea is to assemble a team of contract attorneys for each lawsuit. Each attorney would work on a particular project, such as research, drafting a pleading, discovery response, etc. as needed. Each project would have a deadline and a number of hours allotted to it. The case would be handled on a project management basis so that the client knows the cost in advance. The contract attorneys would be billed at a going contract rate plus overhead and a small profit. The lead attorney would bill at a higher rate. I am also considering billing the contract attorneys for cost during the course of the case with the client owing the remainder at the end of the case.
The key to the model is payment by the client. The client would need to make a commitment to pay a certain amount each month since the contract attorneys and the costs of the suit would have to be paid each month. This amount would be considerably less than the retainers paid monthly to dedicated litigation firms, particularly large firms. But, the client would need to understand and commit to pay.
Another key is that the contract attorneys would need to have to have strong writing and research skills. And, they would need to be able to work on a project/limited hours basis with little direct supervision. They would have to understand that they can't milk the file and, if a project was more difficult and might take longer, they would have to immediately communicate that fact to the lead attorney/project manager.
Documents, including client documents, would be cloud stored or stored in digital vaults. There is no need a lot of paper or attorneys collocated in a firm. Everything would be digital. Obviously, the lead attorney/project manager would have to have excellent communication and management skills. And, frankly, that attorney would have to be ruthless about contract attorneys who couldn't do quality work within a reasonable amount of time. Those attorneys would have to be cut out or, preferably, not hired in the first place.
I calculate that in a business litigation case, the project management model might reduce the attorneys fees by as much as 70% over dedicated litigation firms, particularly larger firms. That is a huge savings. I have discussed it with a few attorneys and they think it is a great idea. One even said that he didn't understand why someone wasn't doing it already.
Saturday, January 1, 2011
Change in California Business Entity Reporting
The California Secretary of State reminds California business entities to file their annual Statements of Information.
Statements of Information are filed with the Secretary of State annually by entities such as corporations and limited liability companies. The statements are the public records of those entities. An entity that does not file a statement can be suspended and/or fined $250.00.
In the past, the Secretary of State would, every year, send a Statement of Information and a self-addressed envelope to each entity 90 days before the statement was due. Starting earlier this year, the Secretary of State only sends a postcard reminder to each entity. This is a cost cutting measure.
A corporation or a limited liability company must now either download the Statement of Information from the Secretary of State's website, fill it out and mail it to the Secretary of State, or a corporation can file one electronically through the Secretary of State's website.
I have a few clients who did not timely file their Statements of Information this year because they were waiting for their Statement of Information forms in the mail. They failed to take note of the postcard informing them of the new policy. They were quickly fined $250.00 - much faster than in the past. Since the state is hurting for money, it is cutting costs and enforcing penalties more harshly.
The following is a link to the Secretary of State's website explaining the policy. http://www.sos.ca.gov/business/be/forms/si-mailer-format-change.pdf
If you own a corporation, a limited partnership or a limited liability company, please ensure that your entity's Statement of Information is timely filed. It is a mundane but important chore in keeping your entity in good standing.
If you have any questions about Statements of Information, or anything else, please contact us. Remember, we do not charge for initial consultations.
Please also visit our website.
Happy New Year! 2010 was a difficult year for almost every business owner and professional that I know. I hope that everyone enjoys a more prosperous 2011.
Statements of Information are filed with the Secretary of State annually by entities such as corporations and limited liability companies. The statements are the public records of those entities. An entity that does not file a statement can be suspended and/or fined $250.00.
In the past, the Secretary of State would, every year, send a Statement of Information and a self-addressed envelope to each entity 90 days before the statement was due. Starting earlier this year, the Secretary of State only sends a postcard reminder to each entity. This is a cost cutting measure.
A corporation or a limited liability company must now either download the Statement of Information from the Secretary of State's website, fill it out and mail it to the Secretary of State, or a corporation can file one electronically through the Secretary of State's website.
I have a few clients who did not timely file their Statements of Information this year because they were waiting for their Statement of Information forms in the mail. They failed to take note of the postcard informing them of the new policy. They were quickly fined $250.00 - much faster than in the past. Since the state is hurting for money, it is cutting costs and enforcing penalties more harshly.
The following is a link to the Secretary of State's website explaining the policy. http://www.sos.ca.gov/business/be/forms/si-mailer-format-change.pdf
If you own a corporation, a limited partnership or a limited liability company, please ensure that your entity's Statement of Information is timely filed. It is a mundane but important chore in keeping your entity in good standing.
If you have any questions about Statements of Information, or anything else, please contact us. Remember, we do not charge for initial consultations.
Please also visit our website.
Happy New Year! 2010 was a difficult year for almost every business owner and professional that I know. I hope that everyone enjoys a more prosperous 2011.
Monday, December 20, 2010
Sometimes the solution is not legal at all
I had a meeting with the principals of a new client today. The company had former employees who stole customer lists and had just started to contact those customers for a new competing business.
After much discussion about what would be the best course of action, cease and desist letter, the course and cost of potential litigation, I asked how much business the company had lost. I asked since they were wondering what would be the best thing to do.
The principals told me that they had not lost any yet. I agree with one of the principals who asked if maybe the best course would be to do nothing. They then came up with a new idea. Send out an offer to the customers that they think have been contacted by the former employees and give them an incentive offer. If they have been contacted by a competitor, they would get two weeks free service on showing proof of the contact with the competitor. The idea being the company keeps its customers and gathers further evidence against the former employees.
The principals were delighted with this idea and I heartily agreed. I told them that the best outcome would be to beat the old employees in the marketplace.
After much discussion about what would be the best course of action, cease and desist letter, the course and cost of potential litigation, I asked how much business the company had lost. I asked since they were wondering what would be the best thing to do.
The principals told me that they had not lost any yet. I agree with one of the principals who asked if maybe the best course would be to do nothing. They then came up with a new idea. Send out an offer to the customers that they think have been contacted by the former employees and give them an incentive offer. If they have been contacted by a competitor, they would get two weeks free service on showing proof of the contact with the competitor. The idea being the company keeps its customers and gathers further evidence against the former employees.
The principals were delighted with this idea and I heartily agreed. I told them that the best outcome would be to beat the old employees in the marketplace.
Monday, November 15, 2010
Authorities Regarding Vicarious Liability in eCommerce
On November 4, 2010, I gave a presentation entitled "Vicarious Liability in eCommerce: The Legal Exposure of Internet Businesses for the Wrongdoing of Others" for the San Diego County Bar Association.
A few attorneys who could not attend asked if I could share the authorities on which I based my presentation. I gave them the authorities and I thought I would share them here also.
Statutes
California Unfair Competition Act, Business and Professions Code 17200, et seq.
Federal Trade Commission Act, 15 U.S.C. 41, et seq.
U.S. Copyright Act , 17 U.S.C. 101, et seq.
Cases
A & M Records, inc. v. Napster, Inc. (2001, 9th Cir.) 239 F.3rd 1004.
Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd. (2005) 545 U.S. 913, 125 S.Ct. 2764, 162 L.Ed.2nd 781.
Emery v. Visa International Service Assoc. (2002) 95 Cal.App.4th 952, 116 Cal.Rptr.2nd 25.
Schulz v. Neovi Data Corporation, et al. (2007, 4th Dist.) 152 Cal.App.4th 74, 60 Cal.Rptr.3d 810.
Perfect 10, Inc. v. Visa International Service Assoc. (2007, 9th Cir.) 494 F.3rd 788.
Perfect 10, Inc. v. Amazon.com, Inc., et al. (2007, 9th Cir.) 487 F.3rd 701.
Federal Trade Commission v. Neovi, Inc., et al. (2008, S.D.Cal) 598 Fed.Supp.2d 1104.
Federal Trade Commission v. Neovi, Inc., et al. (2010, 9th Cir.) 604 F.3rd 1150.
A few attorneys who could not attend asked if I could share the authorities on which I based my presentation. I gave them the authorities and I thought I would share them here also.
Statutes
California Unfair Competition Act, Business and Professions Code 17200, et seq.
Federal Trade Commission Act, 15 U.S.C. 41, et seq.
U.S. Copyright Act , 17 U.S.C. 101, et seq.
Cases
A & M Records, inc. v. Napster, Inc. (2001, 9th Cir.) 239 F.3rd 1004.
Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd. (2005) 545 U.S. 913, 125 S.Ct. 2764, 162 L.Ed.2nd 781.
Emery v. Visa International Service Assoc. (2002) 95 Cal.App.4th 952, 116 Cal.Rptr.2nd 25.
Schulz v. Neovi Data Corporation, et al. (2007, 4th Dist.) 152 Cal.App.4th 74, 60 Cal.Rptr.3d 810.
Perfect 10, Inc. v. Visa International Service Assoc. (2007, 9th Cir.) 494 F.3rd 788.
Perfect 10, Inc. v. Amazon.com, Inc., et al. (2007, 9th Cir.) 487 F.3rd 701.
Federal Trade Commission v. Neovi, Inc., et al. (2008, S.D.Cal) 598 Fed.Supp.2d 1104.
Federal Trade Commission v. Neovi, Inc., et al. (2010, 9th Cir.) 604 F.3rd 1150.
Thursday, November 11, 2010
Why Hire an Attorney to Incorporate
Given the rise of the use of online companies to form corporations, many people ask why they should use an attorney to form a business entity such as a corporation. The reason is because online companies do not do three important things that business owners must address when they incorporate.
What online companies do:
They do what you tell them to do.
They file articles of incorporation.
They obtain Federal Employment Identification Number (FEIN).
They appoint the initial director(s) of the corporation.
Send the customer a notebook with a bunch of forms.
They might draft organizational minutes and bylaws and file SOI with state.
What online companies don't do:
Do not finish organizing the corporation.
Do not issue stock.
Do not file necessary notices to make stock issuances lawful.
Most importantly they don’t address the Three Crucial Questions business owners miss.
The Three Crucial Questions are:
What type of entity, where, and why?
What is the entity’s capitalization?
What happens if: a partners dies, becomes disabled or says “I’m out of here”
These issues are vital. Why do you want a LLC in Delaware? What are you paying for your stock; what are you putting into your corporation? What happens if you die or just quit working in the business?
The online companies won't help with these issues and others. An attorney can help business owners to work them out. Business owners who don't work through these issues are asking for serious trouble.
Subscribe to:
Comments (Atom)
