Franchisee-franchisor relations are getting tense in the down economy. Several companies such as Wendy’s, Burger King, and Quiznos have been in the headlines because of franchisee unrest, including charges of racketeering and corruption and complaints about food costs, supplies, and the use of marketing and advertising funds.

“When your profits are gone, the first place you look is to see who is taking the most money off you,” said Kevin Tackett, the president of the Quiznos Franchisee Association (QZFA).

With less people going to restaurants, franchisees start to look around the store for answers. Is it new food that is cutting into profits, forced advertising campaigns, or upgrade costs, for example? When a franchisee feels that their part of the franchise agreement is not being upheld, they should present their concerns to a franchise attorney, allow him or her to review the terms of their agreement, advise on those terms and potentially seek to initiate negotiations or litigation against the franchisor. Resolving a franchise dispute quickly is essential to making sure the business can run smoothly and be profitable.

Wendy’s recently settled with its largest franchisee, the WendPartners Franchise Group, after it wanted stores to install new toasters for an up-and-coming cheeseburger that would increase sales by more than two percent. Big costs like new toasters across many stores can be tough when profits are not as plentiful as they were in the past.

Burger King settled a lawsuit with its franchisees in the spring after store owners were required to sell a double cheeseburger for $1 as part of a promotion. Franchisees said they were losing at least a dime per sandwich, and when you add it up, it hurt their bottom line. The Burger King National Franchisee Association says the settlement has been a positive step that allows franchisees to have more input in future promotions. The restaurant is also hoping that a menu makeover will also drive more profits to the franchisees.

Quiznos survived a slew of franchisee lawsuits back in 2009 too. Franchisees were in disputes over royalties, marketing funds, and food and supply issues. The QZFA seeks to work with Quiznos Corporate in an open way so that business decisions are more transparent and profit concerns are addressed more efficiently.

And even over at KFC, the franchisee-led KFC National Council and Advertising Cooperative (NCAC) won a recent battle against the corporate office over advertising. Advertising strategies and promotional dates should be a discussion between both sides to have the most impact.

In the end, franchisees are wise to have a franchise lawyer on speed dial and open lines of communication with their fellow stores. The downturn in the economy is too severe to go it alone against the corporate office.

Anthony Spotora is a Los Angeles business lawyer, Los Angeles franchise lawyer, and Los Angeles business litigation attorney. To learn more, visit Spotoralaw.com.

Logos are one of the cornerstones to a business’ sales and marketing identity. It can be as essential as the business itself for a brand’s identity to clients and the public. Logos that are not thought out or resemble other well-known logos may not only appear amateurish to the audiences the business is trying to attract but may further be committing infringement. An individual or a business can protect an original logo, provided it has proof of authorship via the U.S. Copyright Office and/or by registering for trademark protection through the United States Patent & Trademark Office.

Original authorship on websites, business slogans, and even innovative marketing campaigns are critical to protect. A skilled intellectual property attorney can help you acquire and protect these coveted assets that mean so much to your business. Otherwise, these parts of your business could be jeopardized because you did not get adequate protection. It is worth the time and investment to have an experienced attorney help you with these steps.

It is important to note that if you are the first to use a name, logo, or slogan in a geographic area, then you might have gained some common law rights and have a ‘first use’ argument. You have the right to initiate a lawsuit should someone infringe on these business assets, but they are limited without registration. So if you want to protect these assets on a national or international level, you must register and trademark them.

In a recent intellectual property suit, graphic designer Bill Dawson was shocked to find that a logo design he created for an independent film company was on the big screen, when months before the company had expressed no interest in his designs. This issue started when the designer saw his logo at the end of the Conan the Barbarian movie, but then he noticed it was in several Millennium films, including Elephant White, Trespass and Puncture, and that it was also on Millennium’s website. Dawson is claiming at least $200,000 in damages for copyright infringement and breach of contract for unauthorized use of his work.

Originally, Dawson had been contacted by Technicolor, a technical production services company to create a logo for Millennium Films for a small fee. Dawson, as the head of the graphic studio XK9, says that he had a verbal contract with a Technicolor agent. But when Millennium did not show any signs of interest in the designs, no further compensation was pursued.

That there seems to be a missing gap of information between Dawson, Technicolor, and Millennium in this exchange will make for a very interesting court case. Perhaps the court case will show what the agreement, if any, was between Technicolor and Millennium. Regardless, the lack of written terms will likely weigh in Dawson’s favor under copyright laws. As the rightful owner of the designs, he is seeking $200,000 in damages and wants any products, advertising, and marketing collateral with the unauthorized logo to be given back to him.

Anthony Spotora is a Los Angeles intellectual property lawyer, Los Angeles entertainment lawyer, and Los Angeles business litigation attorney. To learn more, visit Spotoralaw.com.

When a company is looking to raise funds without an initial public offering, a private placement memorandum (PPM) is one of the best ways to raise capital. A company must have the consent of the Securities Exchange Commission (SEC) before this can be done, and will need an information memorandum along with the PPM. Because of the complexity of SEC rules and documentation, it is highly advised to seek a knowledgeable business attorney to help throughout this process.

PPMs are a great sales tool to attract investors, which are also known as subscribers. This document shows that the company directors and officers are serious about their company, have the professionalism to succeed in their particular industry, and are committed to having good products, no matter what sector they are in. The content should be focused on information that allows the investor to make an informed investment decision. Some of the information is required by law, and this is where the business attorney provides valuable insight.

The length of a PPM will be greatly influenced by the caliber of angel investors sought and the amount of capital needed. All PPMs should be very polished, professional documents. The company must disclose all material and relevant facts. No half truths, omissions, or false statements of facts are tolerated. Otherwise, making material misstatements can lead to a securities fraud claim that can affect the company as well as the company’s directors and officers. The SEC can also levy civil and criminal penalties for securities fraud. Thus, taking the time to create and thoroughly review the PPM with a business lawyer’s guidance is well worth the effort and money.

A PPM has numerous technical sections. This includes:
• Summary of Offering Terms: Usually laid out via a term sheet
• Issuer Description: Describes the company and its structure, a short overview, a cap table and context of the offering
• Business plan: Contains information on the company’s position in the market, its unique value proposition and products, as well as the sales and marketing plan, financials, intended use of proceeds, and management
• Risk factors: Details potential and actual risks that could affect the investor; cautionary language should also be included about investment risks in general with unregistered securities; and conflicts of interest should also be described
• Supplemental information: Any additional information should be included that is critical for the investor to make an informed decision
• Subscription procedures: Describes the steps for investors to participate in the offering

Having a trusted business attorney to create, review, and file the PPM allows a business to focus on its daily operations and long-term plan. Business owners can have peace of mind that all the paperwork is done in a thorough way to minimize issues and attract key investors.

Anthony Spotora is a Los Angeles business attorney , Los Angeles trademark attorney, and Los Angeles entertainment lawyer. To learn more, visit Spotoralaw.com.

It is a must to have a partnership agreement when two or more people are the entrepreneurs of a company. Without a written agreement, the viability of the long-term business can be compromised. At the start of a business, it is close to impossible to forecast how the company will evolve over time. As such, a formal agreement helps to create a foundation between partners that should define significant business issues such as how funds are distributed, how disputes will be handled, and the job duties expected of each partner.

The structure of a partnership agreement should be tailored to fit the business and management style. It should state the compensation, including the profits, losses, and draw each partner will take. Moreover, and surprising to many new partnerships, it is also commonly considered as wise for one partner to have more shares than the other(s). Otherwise, it can become a situation where the company becomes stalled with equal decision makers at the top.

The agreement should additionally show the contribution each partner has made to the business, including property, funds, and services. It should further list how new partners can be added at a later time, when applicable. Of equal importance are outside business activities a partner might take on, and what is permitted.

Basics such as who has check-signing privileges and decision making authority or voting rights is also very important and should be included. And while legalese to many, miscellaneous provisions that cover matters like how the agreement can be revised at a later date to meet the growing needs of the business should also be incorporated into the partnership agreement.

Of particular importance are the portions of the agreement that define what action will be taken if a partner leaves or can no longer perform the job duties. This facet is also important for financing as lenders want to see a rational agreement that will help the business maintain stability should this occur.

Stipulating what will happen should a dispute ensue is also critical. Partners should think this through as arbitration or mediation can be a better route than litigation in most cases.

Partners should get a skilled business attorney to create the contract and review it to ensure that each person’s rights and obligations have been addressed and are fair. Without legal representation, the agreement might be so threadbare that state law might override it during a dispute. It might feel awkward to think about all of the “what ifs” during the infancy of the business, but it is crucial to ensure that the business can develop in a healthy way. Time spent with a qualified business attorney will pay off later.

In California, Los Angeles business attorney Anthony Spotora, of Spotora & Associates, P.C. is accomplished in counseling business partners to create solid partnership agreements. Their team of Los Angeles business lawyers helps many businesses, from California companies to major international corporate entities. They are known for their high-quality services and prompt attention to a client’s business needs.

Anthony Spotora is a Los Angeles entertainment lawyer and Los Angeles business attorney. To learn more, visit Spotoralaw.com.

Los Angeles, Calif. – Oral agreements can wreak havoc in Hollywood. An agreement by handshake or over lunch can still be a valid contract and enforced by a court. Two recent lawsuits prove that the oral agreement is still alive, but not necessarily well, in Hollywood.

In Richard Davis and Trademark Properties v. A&E Television Networks, Davis developed the idea of “Flip This House” and A&E orally agreed to divide the show profits 50-50 with him. During their meeting Davis and Charles Nordlander, director of lifestyle programming for the station, negotiated many facets of the show, including pay. After most items were agreed to, Nordlander said, “Okay, okay I get it.” After the pilot and 13 episodes, Davis left the show for a competitor. At trial and the appeal proceedings, both courts affirmed that an oral agreement was entered into and awarded Davis $4 million. The “Okay, okay I get it” was enough to seal in the jurors minds that an agreement had been made, even though it was never written down.

“There is nothing like a signed agreement,” says Los Angeles entertainment attorney Anthony Spotora. “At a minimum you should follow up a discussion and agreement with a confirming email or get your attorney to draft an agreement that is sent for all parties to sign. This case shows that you never know when this backup documentation will come in handy and can save you tons of time, stress and money.”

Another home and design show is under fire for oral agreements gone awry. Talent manager Lance Reynolds, his company Atlantic Talent Management, and Atlantic Films and Television, is suing Jamie Durie, the host of HGTV’s “The Outdoor Room”. Reynolds alleges the two made an oral agreement that Atlantic Films and Television would have 51 percent ownership stake in the popular show. In 2008, Reynolds was made an executive producer of the show and earned a program fee “on a favored nations basis with all other executive producers” after the two had a business dispute. Reynolds alleges after 39 shows, Durie has been well paid and owes him money.

“In oral agreements, courts will try to find any witnesses who might have heard the terms of the agreement, or if the parties have actions, evidence, or exhibit certain conduct to show that it was in existence,” said Spotora. “But you truly owe it to yourself to get your future earnings in writing.”

The Law Offices of Spotora & Associates has more than a decade of experience working with celebrities, producers, studios, agencies, managers, and networks in every genre of the Hollywood television and movie industry. They are known for their hands-on approach and senior-level counsel that is unparalleled by other firms.

For more information:
www.spotoralaw.com
Law Offices of Spotora & Associates, P.C.
1801 Century Park East, 24th Floor
Los Angeles, California 90067-2302

P (310) 556.9641
F (310) 556.9642
Toll Free: (877) 4U-EZ-LEGAL

To learn more, visit https://www.spotoralaw.com/.

Business owners work diligently to build value in their company and to attract consumers and investors. Many plan for the day when they can go public and have an initial public offering (IPO). With recent technology companies raising some serious cash, it’s no wonder that many businesses are contemplating if they can mimic LinkedIn and Pandora’s IPO successes. To that end, whether your company is in the tech sector or a different industry, you’ll want to get a qualified business attorney on your side.

When a company files for SEC registration, the information becomes public record. As such, a knowledgeable business attorney will ensure that the registration and documents meet SEC requirements and protect your corporate image. Preparing for an IPO is tedious work, and unless your company can get an SEC exemption, the paperwork is best drafted and reviewed by counsel.

For those companies who want to pursue other methods of raising capital and are eligible for one of the SEC exemptions, legal counsel remains critical. For example, the Rule 504 exemption of Regulation D allows a company to avoid SEC registration if they: sell up to $1 million in securities in any given year timeframe privately; do not have to file reports per the Securities Exchange Act of 1934; and, it is not a blank check company. The Rule 504 exemption lets a company avoid SEC registration and some report filing, but a company will still need to file Form D after the first securities are sold in a private sale. An experienced business attorney will help a client make sure the documents for the private sale and Form D are completed thoroughly without erroneous statements and violations of antifraud provisions.

This also applies to Rule 505, Regulation D of the SEC exemptions. Rule 505 allows up to $5 million in securities offerings and has different investor requirements, but Form D is still mandated. A business attorney will give a company peace of mind that they are completing investor disclosure documents and Form D efficiently.

Rule 506 exemptions allow a company to raise unlimited monies but all non-accredited investors must be sophisticated investors, unlike the guidelines of Rule 505’s non-accredited investors. Form D is still required.

Overall, a business attorney is well worth the investment to ensure that all the steps are completed with precision. The SEC is not a governmental body anyone wants knocking at the door for failing to comply with their rules and regulations. Retaining legal counsel, whether to raise capital through an IPO or privately, helps a company move forward in the best way possible. Business owners can therefore focus on the aspects they are best at and lessen their stress and potential liability during this critical time.

In California, Los Angeles business attorney Anthony Spotora counsels businesses from sole proprietorships to major international corporations on raising capital and SEC requirements and exemptions. The Law Offices of Spotora & Associates, P.C., has decades of experience with businesses throughout California, the U.S., and abroad.

For more information:
www.spotoralaw.com
Law Offices of Spotora & Associates, P.C.
1801 Century Park East, 24th Floor
Los Angeles, California 90067-2302

P (310) 556.9641
F (310) 556.9642
Toll Free: (877) 4U-EZ-LEGAL

Anthony Spotora is a Los Angeles entertainment lawyer and Los Angeles business attorney. To learn more, visit Spotoralaw.com.

Los Angeles, Calif. – The small print on a website seems hardly interesting, but the terms of service (“TOS”) agreement on a business’ home page is a must have to protect the business and its users.

A recent incident on Electronic Arts’ Dragon Age 2 online message board is a great example of what a terms of service agreement can do. Electronic Arts bought Dragon Age 2’s creator, BioWare, in 2007, and now a gamer must open an online account with EA to play the game. One of them voluntarily wrote on the BioWare message board, “Have you sold your souls to the EA devil?” Because EA had a terms of service message, they could prevent this gamer from logging into his EA online account for three days.

Businesses can cover a lot of issues in a TOS agreement, but they must be sure not to copycat another site’s TOS content. TOS agreements are actually copyrighted and since every business has unique rules and systems, it is best to get a qualified business attorney to assist in its creation and enforcement.

A terms of service section will go over the rights and responsibilities when a user accesses a website for e-commerce, research, or pleasure. By continuing to click on a site’s unique pages, users will be viewed as agreeing with the TOS statements. Business attorneys will give legal guidance on rules for online privacy, safety and account security, interactions with other domestic and international users, advertising and copyright policies, as well as dispute resolution and termination of services.

“Today’s marketplace is not an easy one to thrive in,” said Los Angeles business attorney Anthony Spotora of the Law Offices of Spotora & Associates. “An experienced business attorney can assist a website and business owner with making sure they have thought of every facet on their terms of service page so the business has the best chances for success and the best possibility of avoiding issues that were otherwise preventable.”

Anthony Spotora has decades of experience in business law. From start-ups to large, multinational corporations, he counsels on terms of service agreements, intellectual property rights, business contracts and partnerships, and business plans. The firm represents clients in many industries, from restaurants, nightclubs, web-based businesses and accounting firms, to Hollywood studios, production houses, entertainment agencies, technology firms, pharmaceutical companies, and land-based retail outlets.

To learn more, visit https://www.spotoralaw.com/.

Liability protection is one of the biggest advantages to incorporating a business. When forming a corporation, LLC, or similar entity, a “corporate veil” is formed that creates a separation between the entity and personal shareholder assets. In some instances, courts will pierce this protection and hold shareholders personally liable for the debts and liabilities of the corporation, if the shareholders are found guilty of having misused the corporation as their alter ego.

Many lawsuits apply the legal theory of the “alter ego” wherein the corporate entity is shown to be a sham and/or an alter ego of one or more individuals that have brought on injurious conduct and who essentially utilized the entity as a blanket to hide behind. Oftentimes this allegation comes into play when a corporation’s assets or insurance are inadequate to pay debts or claims. The shareholders can become personally liable.

In California, two requirements must be met to pierce the corporate veil:

1) Unity of Interests – the shareholders in question must have treated the corporation as their alter ego; and

2) Inequitable Result – the shareholders sanctioned fraud or injustices.

A step-by-step process is commonly used to examine and ultimately determine if alter ego liability is appropriate in a lawsuit. The landmark case of Associated Vendors Inc. v. Oakland Meat Packing, Co. spells out the steps to determine the severity of their actions:

1. Did the individual(s) act in bad faith?

2. Did the individuals contract with one another with the intent to avoid performance by using a corporate entity to shield against personal liability?

3. Did the individuals divert assets from a corporation by or to a stockholder, other person, or entity to the detriment of creditors?

4. Is the corporation dominated by a few key individuals?

5. Is the same office or business location used by the individuals and corporation?

6. Did the individuals and the corporation employ the same attorney?

7. Did the individuals use the entity to procure labor, services and merchandise for another person or entity?

8. Did the individuals fail to adequately capitalize the corporation?

9. Did the individuals fail to maintain minutes or adequate corporate records?

10. Will there be an inequitable result if the court fails to pierce?

A plaintiff has the burden of establishing alter-ego liability. Courts do not typically make a distinction between different forms of corporations, whether they are non-profit or for-profit, so alter-ego liability is evaluated equally.

If a corporation is properly created and maintained, shareholders will not be liable for corporate debts or exposed to lawsuits. Shareholders must uphold corporate formalities and avoid any misuse of corporate funds, property and means of manipulation.

The keys to making sure an entity stays separate from its shareholders are:

1) Documentation and Formalities: Ensure that all letterhead, business cards, and corporate signs include the words “Inc.” or “Incorporated”, for example. Shareholders who sign contracts or documents should sign them in a corporate capacity indicating their corporate position. Create by-laws, issue stock, maintain corporate minutes, have separate account books, file annual reports, and have regular board meetings with all directors.

2) Avoid Co-mingling: Never co-mingle corporate assets with those of the shareholders. Corporations should have their own separate bank account. If you borrow from or lend to the corporation, record an appropriate resolution, sign a promissory note, charge a fair market rate of interest, and make regular payments.

3) Capitalization: Capitalize the corporation sufficiently and purchase adequate liability insurance.

4) Employment Agreements: Establish one between you and the corporation.

5) Multiple Corporations: Avoid identical stock ownership of several corporations along with similar officers and directors. Use different business addresses, telephone numbers and employees.

This valuable advice is critical to minimize a corporation’s exposure to litigation and help them manage their operations. Small and big companies need to understand the importance of having a lawyer to help them with increasing complexities in today’s business environment.

The Law Offices of Spotora & Associates has decades of experience for both businesses and the shareholders that run them. Their services range from counseling individual and corporate clients domestically and internationally, to assisting in business management and maintaining corporate records.

Anthony Spotora is a Los Angeles entertainment lawyer and Los Angeles business attorney. To learn more, visit Spotoralaw.com.

Businesses spend a lot of time doing marketing and public relations to build their brand, so it can be devastating to find that someone has posted a harsh statement on the Internet that is outright false. For all the efforts that a business puts into websites, social networking and online ads, one bit of misinformation can sometimes topple their credibility.

Two common grievances include businesses being accused of dishonest practices and discrimination. Competitors and unhappy individuals are usually the ones blamed for trying to undermine the business’ reputation on online chatrooms, Facebook, “protest websites”, and mass e-mails. But to show that a business is a victim of defamation, it must show that the published statement was false and resulted in a loss.

As soon as a business realizes that the unflattering material is on the Web, it is advised to keep thorough records of what is being posted. Compile a list of all websites that have the defamatory statements. This will be useful evidence in the courtroom or for takedown letters that reputation management services create. Also, keep records of sales numbers from before and after the harsh content appeared on the Web. This will help show the loss incurred and aid the court in calculating damages.

And do not fall into the knee-jerk reaction of trying to threaten the author, publisher or website. A lawyer can help get the bad content removed, but not if you are threatening them and have the police at your door to calm you down. Section 230 of the Communications Decency Act does protect webmasters and hosting companies from being held liable for what another user posts on their website unless it can be proved that the specific individual was responsible for its publication. An Internet company that permits criminal acts or intellectual property infringement may still be held liable, so it is advised to get an experienced attorney early on when an issue occurs.

In order to protect the business, a company will want to get legal counsel and serve the wrongdoer with a civil action alleging defamation and libel. Many businesses do not know who harmed them as oftentimes the degrading postings are by anonymous authors. Businesses are advised to provide a notice in whatever medium the original posting was made to make the anonymous author aware of their wrongdoing before any subpoena is enforced. The case will initially be against a “John Doe” defendant and through the discovery process, ISP records and other pertinent information will reveal their true identity.

Good attorneys will help their client win monetary compensation and an injunction that forces the author or website to remove the offending material and refrain from defaming the business in the future. Otherwise, the author could be fined or jailed for contempt of court.

The Law Offices of Spotora & Associates has decades of experience representing individuals and businesses in defamation cases from sole proprietorships to major international corporate entities. Their clients are actively involved in various industries including technology, marketing, communications, pharmaceuticals, retail sales, manufacturing and distribution, as well as restaurants and nightclubs, film, television and multimedia productions. Their lead Los Angeles business lawyer, Anthony Spotora, is one of the area’s top attorneys who is well versed in both business and Internet law.

Anthony Spotora is a Los Angeles entertainment lawyer and Los Angeles business attorney. To learn more, visit Spotoralaw.com.

Los Angeles – Imagine a business owner doing a routine Google search of his business and name, only to find that a website thousands of miles away had copied the logo, design, text and even some photos. This is what happened to the law firm of Gordon & Doner out of Palm Beach, Fla. when they looked themselves up and found the British firm of Maslin & Associates with a copycat website.

A business should protect its website and all the content, design, and graphics by copyrighting it. This way, all the original works of authorship are protected, as well as the look and feel of the website. Be sure to request ownership of the copyright in a written agreement if an outside company creates the website. This could increase the fees from the graphic design company but then later on the business could have the authority to use the same graphics and content on promotional materials such as brochures and mailings.

Copyright protection starts when the work is fixed in a tangible medium. Use the copyright symbol to inform others that the business has control over the display of the website, its production and distribution. State in the fine print that the business has created the website and is copyrighted. By copyrighting a website, it will be easier to seek court enforcement of the copyright should a copycat come along.

“A business and its employees work hard to create and maintain an Internet presence that will generate revenues and continue the marketing efforts,” said Anthony Spotora, Los Angeles business and intellectual property lawyer. “A good lawyer will help their clients protect their Internet business assets through copyright protection services.”

Copyright infringement is a very serious matter and should a programmer even copy code from another website, a business could be on the wrong side of the law. Websites can be shut down without notice as a part of the Digital Millennium Copyright Act and “blacklisted” from Google. Google will remove sites that infringe on another’s intellectual property, program its spiders to avoid the site and ban it from its Adwords and Adsense programs.

It pays to hire a business and intellectual property attorney to assist with trademarks for domain names and unique business phrases, copyrights for the website, and contractual agreements for creative services done both for the website and with vendors used during daily business transactions.

Spotora & Associates has more than a decade of experience representing clients from start-ups to established national corporations with their website and intellectual property concerns. They are skilled in researching, registering, and protecting intellectual property rights throughout the United States and abroad.

To learn more, visit https://www.spotoralaw.com/.