Have you ever wondered why almost all law firm conference rooms have tissue paper centered in the middle of the conference room table?
Our conference room is not too different from the one pictured (although our conference room is a bit higher-end).
In a lawyers’ office, however, the tissue paper isn’t there to erase dry marker boards. The tissue paper represents something much more troubling.
Beware of Information on the Internet
As a business attorney running a successful business law firm, I see small business owners and leaders, doing what they view as a prudent thing: conducting research on the Internet.
Conducting research before taking action is certainly a valuable and important activity, especially in small business. The problem is, legal issues are very complicated and there are many exceptions to the rules, depending on location, circumstances, parties involved and more. Therefore, when conducting research on the Internet, it’s really important to learn to separate “business issues” from “tax issues” from “legal issues”.
Anyone with experience can have an opinion about “business issues,” although someone skilled in brick laying with an opinion about brain surgery probably isn’t the right person to listen to. We all know this, although it becomes more difficult to discern the value of such a person’s opinions, when their expertise isn’t fully disclosed, or it’s less dramatic between a brick layer and a brain surgeon, such as a horse breeder versus a veterinarian or dog breeder.
The same concerns relate to “tax issues.” You really shouldn’t assume that your circumstances are the same to someone else’s, and therefore their opinion on taxes relates to yours, unless they are a tax professional. Tax professionals are CPA’s and tax attorneys. Anyone else should be viewed with a heavy dose of suspicion.
“Legal issues” are the most dangerous, and it can be difficult to discern when you’ve moved from “business issue” or “tax issue” to “legal issue.” The Internet is full of what we lawyers call “unlicensed legal providers,” and they wreck havoc with the concept of long-term success and viability. Let me give you some examples.
Measure Success Not By Completing a Task, but Whether Such Task Helps You Accomplish Your Long-Term Goals
When you Form a LLC or Form a Corporation with us, we have many rules and procedures in place to help make sure folks do them right, so that they don’t find themselves in trouble later when there is a partnership dispute or lawsuit. Two examples include: Not letting clients use our Registered Agent address as their mailing address, and giving clients a very high-quality Operating Agreement for LLC’s.
What do the “unlicensed legal providers” do? Their goal is to form companies. In fact, for much of our competition, they ask you to rate your experience after you place your order, and then they advertise their 5-star rating based on the experience of placing an order.
In other words, non-lawyers and non-attorneys measure success of “filing something.” The truth is, a monkey can “file something.” It takes a lot more experience and effort to “filing something properly, so that you minimize trouble 3, 5 or 10 years from now.”
The reason lawyers and attorneys care about the long-term is critical to understand: We lawyers can be sued for malpractice, first of all. Second, we’re the ones that have to pick up the pieces when the house built on a crummy foundation falls. We’re the ones that have to console our clients in the conference room, with tissue paper, explaining that it’s going to cost $100k or so, to defend against a frivolous lawsuit that aims to “pierce the corporate veil” because your company wasn’t setup properly.
As another example, consider trademarks. The law on trademarks, and procedure, is very complex. Don’t believe me? Just take a quick look at the Trademark Manual of Examining Procedure (or TMEP) on specimens. There are literally thousands of pages in the TMEP. But, don’t let that get in the way of the “unlicensed legal providers.” We’re competing with folks offering trademark registration for $49 (plus USPTO fees). The problem is, they measure success by getting your information, putting it on a form, and having you submit. That’s it. They don’t mention that you will have over an 80% chance of rejection. Then what do you do?
As a trademark lawyer, when we conduct a Trademark Registration for someone, we work hard to have a successful submission. We’re there to answer questions, and help move things along if the USPTO has questions or rejects for some reason.
Small Things Can Have a Big Impact Later
The tissue paper on the tables in our conference rooms are literally used every day. Small business owners don’t have the cashflow to spend a lot of money on attorneys, but when their partner locks them out of their business, or physically threatens them, steals from the company, or doesn’t pay employee withholding taxes — your ability to deal with a bad partnership cost-effectively will greatly depend on the quality of your formation documents.
As a smart business owner or leader, your goals should be long-term. Wealth maximization. Asset preservation. Sustained growth. Your tactics should be to implement core components of the business with these concepts in mind.
When we’re talking about decisions related to things that have little to no impact to your business, or that can easily be changed later, such as the type of paint you use on your walls, or your landscaping, it’s okay to focus on least-cost providers.
But, when we’re talking about forming your company, a partnership, intellectual property like trademarks, contracts that govern important relationships (i.e. with partners, vendors, customers and/or suppliers), it’s certainly okay to conduct research to better understand the issues, but please be very careful when getting advice from — or considering doing business with — anyone that isn’t an attorney. Only attorneys and lawyers, fresh with their previous client’s use of the tissue paper in the conference room, can properly advise you for the long-term for these important “legal issues.”
Law 4 Small Business (L4SB). A little law now can save a lot later. A Slingshot company.