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Adina A.
By: adinaa
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When Do You Need a Business Lawyer?

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As a business owner, you probably have asked yourself the question at various points, “Do I need a business lawyer for my business?” Knowing when you may or may not need to work with a lawyer and whether it is a situation that is worth paying the cost of doing so is something many business owners struggle with.

When in doubt, it´s a good idea to at least consult with a lawyer to see if there is a legal issue that is affecting your business that you may not be fully aware of and to determine how serious that issue may be. Then, you can determine if there is a need for the services of a lawyer.

Benefits of Working With a Business Lawyer

There are many benefits associated with working with a business lawyer:

Guidance

When starting your business, a lawyer can help you figure out the best legal structure for your business whether it be a sole proprietorship, limited liability company (LLC), partnership, C-corporation, or S-corporation. After making the decision on the type of business you will have, a lawyer can also ensure that the business is set up correctly.

While some business owners who have a simple business structure are able to figure out the legal aspects of the business on their own, hiring a business lawyer can still make sense in some cases. Business owners have many demands on their schedules and must focus on non-legal concerns essential to the business such as making sure that the business has starting costs funded, is profitable, and can survive the competition. Having a lawyer can allow the business owner to focus on the business rather than having to learn the complex legal process.

Assistance with Documentation

Particularly if a business is well funded and can afford it, it may make the most business sense for a business owner to outsource legal aspects of the business to a lawyer. There are many forms and legal documents to navigate in starting and maintaining a business, which can be overwhelming to do on your own without a lawyer. If a lawyer’s help is brought in, the many hours that it may take a business owner to figure out a legal process could be used for growing the business instead.

Assistance with Legal Issues

Perhaps one of the important times you may need a business lawyer is when significant legal problems come up. If a business is confronting issues that are legally complex or fraught with liability issues, it can be a smart decision to hire a business lawyer.

Prevention of Future Problems

Finally, business owners should consider working with a business lawyer for preventative reasons to minimize risk. For example, sometimes a lawyer can help flag potential legal issues in the business that can be addressed affirmatively to avoid a bigger problem down the line. This could end up saving the business owner thousands of dollars and countless hours of time to avoid a lawsuit or to prevent the business from going under.

Proactively getting help before it is really needed can be a wise move for a small business owner. Although initially, a lawyer may be an additional cost up front that seems unnecessary, a business lawyer can be another cost of doing business that ends up paying off in the long-term by saving money and stress.

Possible Scenarios When Working With a Business Lawyer Could Be a Benefit

There are many types of scenarios that can come it in a business in which working with a business lawyer would particularly help.

1. Deciding the structure of the business

As mentioned, a lawyer can you help determine the best strategy for your business structure, for example, whether it makes the most sense to start as a sole proprietorship, LLC, partnership, C-corporation or S-corporation. This decision can have legal and tax implications for the business and affect the business’ ability to grow in the future. For example, a C-corporation can be preferable to investors for raising venture capital.

2. Launching a business by filing for a business license and other legal documents

After deciding on what kind of business to have, a business owner may be needed to file for a business license and incorporating documents.

A business owner may be able to file for a license on their own if there is a simple business structure. A sole proprietorship can be simple and may not require a state license (although it may still require local licenses).

Filing initial business documents without a lawyer can save money and be helpful to learn the basic business legal processes. However, it can be helpful to at least consult with a lawyer and have the lawyer review the documents to make sure there are no errors that could affect the business.

For more complicated business structures, in most states, an LLC, partnership, C-corporation or S-corporation all require state business licenses. These business structures can also require filing certain formation documents such as Articles of Organization, a partnership agreement, corporate bylaws, an operating agreement, and/or other incorporation documents. C-corporations or S-corporations, in particular, have a more complicated structure requiring bylaws and other documents. A business lawyer would be helpful in all of these matters for complex business structures.

If a new business has particular complexities, it can even more so be a good idea to work with a lawyer. For example, if the business is located in an area with complex zoning laws or recent rezoning, having a lawyer could be helpful when applying for business licenses.

3. Applying for a trademark or patent

Having a lawyer can be critical if your business needs to file for a trademark or patent. If your business is based outside the U.S., you must have a lawyer represent you at the U.S. Patent and Trademark Office. An attorney can also help a business with several steps in the process such as determining if the trademark of the business can be legally protected and enforcing the business’ trademark rights.

4. Website privacy requirements

If your business has a website, a lawyer can help ensure the business is compliant with various privacy laws that are quickly developing through advising on a privacy policy, disclosures, and other legal requirements. For example, California has the California Online Privacy Protection Act (CalOPPA) and the European Union has the Data Protection Directive (DPD), the General Data Protection Regulation (GDPR), and the e-Privacy Directive.

5. When facing a lawsuit

The time when a lawyer is most crucial is if the business is facing a serious legal problem such as a lawsuit. Getting sued by a customer or a former, current, or prospective employees on the grounds of discrimination in hiring, firing, or hostile work environment can be one of the worst fears of a business owner.

Learn here what to do in case of a business lawsuit.

There may also be times when the business needs to sue another party, for example, if a deal or contract goes wrong. If a legal problem is going to court, the business may be in need of a business lawyer with expertise in litigation and other expertises such as employment or contract law.

A lawyer can also be necessary if a government entity is investigating the business for violating any laws or filing a complaint against the business, for example, an environmental or zoning issue.

6. Immigration issues

Additionally, immigration issues can come up that are related to the business. A business immigration lawyer can help ensure that the company is complying with the I-90 process, determine  if your business is at risk because of the immigration laws, such as due to hiring undocumented immigrants, help sponsor a potential employee for an employment immigration visa, and prepare for a potential immigration check such as if immigration officials come to your business.

7. Other complicated legal matters

Finally, for a business that is dealing with complex matters, it’s wise to have a business lawyer to help.

A business lawyer can take care of the following scenarios: raising venture capital and selling equity to investors, purchasing real estate, employment issues, and labor law compliance, creating contracts for independent contractors, and negotiating a contract with clients.

Complex business matters can also come up that a lawyer could help with such as negotiating for the sale of the company or for the acquisition of another company or its assets.

If your business is in a situation that requires a business lawyer, or even if you think it may be wise to consult with one purely for preventive measures, the next step should be making sure you have the funds needed to hire a professional. Some business owners turn to a short term business loan to have the funds available and avoid that a shortage of cash affects their daily operations. If this is your case, learn here if you should use a business loan to hire a business lawyer.

 

 

 

 

 

 

 

 

 

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