Business makes the world go ‘round. Business guidance helps it go more smoothly.

In Adam Smith’s 1776 work entitled The Wealth of Nations, he describes the “invisible hand” in which each person’s pursuit of his or her own interest in market exchanges helps achieve socially desirable ends as well as maximum efficiency and a Darwinian evolution of goods and economies. The ability to self-regulate and achieve efficiencies is affected by monopolies and oligopolies, lobbying, tax preferences, governmental regulations, and other non-market forces.

Today’s business faces all of these obstacles. Well drafted agreements, knowing what can and can’t be done, knowing what to look for (and avoid) in transactions can all have a profound impact on the success of a venture. Who is advising you?

The Law Offices of Brian Irion has represented contractors, lessors and lessees, manufacturers of food and other products, service professionals, licensors, licensees, retail and internet companies, to name just a few.

The post Business appeared first on The Law Offices of Brian Irion | Bankruptcy Attorney, Business Law, Real Estate Law, Litigation.

Litigation cases come in all shapes and sizes, from small to large, in state and federal courts, in administrative hearings, and span the full gamut of all that your business touches.
Competitors sue for unfair competition, employees sue under a host of employment-related laws, clients and customers sometimes won’t or can’t pay for goods or services provided, debts your business may have already collected may be the target of preference lawsuits by a trustee in bankruptcy; the list goes on. Sometimes, the litigation can be traced to a failure to adhere to best practices, or unartful contract language.

Not always.

Unfortunately, litigation is usually expensive. From pleading to discovery, to pretrial motions to trial, all the way to appeal, collection or bankruptcy, everything costs money. If your business can’t avoid litigation, can your attorney represent you from start to finish?

Brian Irion has been a practicing attorney, initially trained as a litigator and trial lawyer, since 1985. Since then, he has litigated in state trial courts, in administrative hearings, before arbitration panels, in bankruptcy courts, in federal district courts, and before appellate courts ever since. Before forming his own firm, he practiced with a number of small and large firms including Lewis, D’Amato Brisbois & Bisgaard; Wilson, Sonsini Goodrich & Rosati; McKenna & Fitting; and Cohen, England & Whitfield in Ventura County.

The post Litigation appeared first on The Law Offices of Brian Irion | Bankruptcy Attorney, Business Law, Real Estate Law, Litigation.

Bankruptcy law is designed for everyone’s benefit.

For the debtor, it offers a fresh start for the honest but unfortunate individual, or breathing room for a beleaguered business to restructure its debts and operations.
For the creditor, it ensures equal distribution of a debtor’s assets among similarly situated creditors and the ability to ensure transparent operations of a debtor without piecemeal enforcement of judgment remedies.

While bankruptcy law is a specialty in its own right, knowledge of the Bankruptcy Code is an essential tool for every transactional lawyer and every civil litigator.

The Law Offices of Brian Irion is a debt relief agency as defined in 11 USC §528. As well as representing creditors, we help people file for bankruptcy relief under the bankruptcy code.

The post Bankruptcy appeared first on The Law Offices of Brian Irion | Bankruptcy Attorney, Business Law, Real Estate Law, Litigation.

Emergency Rule of Court 1 temporarily prohibits evictions of all types in California. But that prohibition will end sometime. It has to because landlords are still facing mortgages regardless of whether tenants pay or not. If tenants don’t pay, the property may well be foreclosed.

California is considering a number of measures to avoid the potential onslaught of evictions. That includes a freshly amended, leadership-backed Senate measure that generally bars landlords from evicting tenants during a state of emergency, allows landlords and tenants to negotiate payment plans that could give renters years to repay and lets property owners claim future tax credits for unpaid rent.

One alternative seemingly not considered by most large law firms analyzing “Acts of God” or “Impossibility of Performance” defenses to rent payment for tenants, is that of bankruptcy. If you can get past your perceptions of stigma, you may recognize this as a viable and possibly preferred solution.

If you are a tenant, bankruptcy can offer you a respite not only from rent, but many other obligations as well as you reorganize your business affairs.

If you are a tenant

If you are a tenant, bankruptcy can offer you a respite not only from rent, but many other obligations as well as you reorganize your business affairs. By sheer happenstance, a new Subchapter V of Chapter 11 of the Bankruptcy Code was enacted Fall of 2019 to make reorganizations easier and less costly for smaller business enterprises. And, some bankruptcy courts have already considered the issue of “Acts of God” as landlords seek payment of rent as a condition to the tenant staying in the premises during reorganization. Tenants may well rather be in front of a bankruptcy judge than a state court judge who may have come from the ranks of district attorneys or a large law firm, and who may not fully understand or be sympathetic to excuses from paying rental obligations.

If you are a landlord

If you are a landlord, you may face the bankruptcy issue from two perspectives: either you may consider it as a method to avoid a non-judicial foreclosure from your lender; or you may have to deal with bankruptcy if your commercial tenant files for bankruptcy and wants more time to make up past rent through a multi-year reorganization plan.

Law Offices of Brian Irion is a debt relief agency that helps businesses and people under the Bankruptcy Code. We also help creditors dealing with debtors and trustees in bankruptcy!

The post As Eviction Controls Ease, Consider the Possibility of Bankruptcy appeared first on The Law Offices of Brian Irion | Bankruptcy Attorney, Business Law, Real Estate Law, Litigation.

Do you have a small business that is severely impacted by the COVID-19 Shelter In Place orders?
Have your PPP, EIDL or other SBA loans been held up or denied?
What will happen to your business when the stay on evictions is lifted?
Should you be using personal funds or retirement funds to support your business?
Are your negotiations with your landlord not going well?

If you are pondering these questions for your business you might consider whether a reorganization bankruptcy might help. Why?

Right now and for the short-term future, California has implemented a “no eviction” emergency order by way of an emergency rule of court that prohibits the issuances of summons for eviction of all types, residential or commercial. Other laws make it unlawful for landlords to begin a residential eviction during an emergency (Cal. Penal Code § 396(f)).

This safe harbor for tenants will not last forever. It can’t. Landlords continue to be pressured by their lenders to pay mortgages while at the same time tenants are not paying rent.  Large law firms are offering to throw matters into litigation, at your cost.

This safe harbor for tenants will not last forever. It can’t. Landlords continue to be pressured by their lenders to pay mortgages while at the same time tenants are not paying rent. Large law firms are offering to throw matters into litigation, at your cost. There has been talk recently, of raising the stay on evictions. When – not if – that happens, it is likely there will be an onslaught of eviction lawsuits, which under California law can be brought to conclusion in as little as two weeks to several months. Commercial tenants who might consider bankruptcy “down the road” will have missed a precious opportunity to plan ahead of time.

In Bankruptcy, Timing is Everything

The truth is that some businesses should be contemplating bankruptcy now. Bankruptcy planning, like tax planning, should occur in the months leading up to the filing, not on the eve of filing. A reorganization bankruptcy is a complex mechanism that comes with powerful tools to help the debtor in possession, but it is not something that should be thrown together last minute. With proper planning, a commercial enterprise might even avoid filing bankruptcy, but that sometimes depends on whether creditors view the potential bankruptcy as a credible threat. And frankly, a commercial tenant ought to consider whether it might be advantageous to be in front of a bankruptcy court rather than a state court arguing for excuse from performance on a lease or contract. State courts are often faced with a variety of cases including criminal and family disputes, whereas federal bankruptcy judges are experts in financial matters and how to get a reorganization accomplished successfully.

Law Offices of Brian Irion is a debt relief agency that helps businesses and people under the Bankruptcy Code. We highly recommend – and will require all possible debtors who are our clients to review – among other things – the disclosures required by 11 USC § 342, ,11 USC § 527, and 11 USC § 528.

The post The Bankruptcy Question for Small Businesses Affected by the COVID-19 Shutdown appeared first on The Law Offices of Brian Irion | Bankruptcy Attorney, Business Law, Real Estate Law, Litigation.

In many smaller companies, corporate formalities are adhered to with less stringent measures. Yet, it is often the smaller companies where shareholder disputes erupt over time, and the failure to adhere to corporate formalities and obligations can result in lawsuits that can cause damage to the company and the relations between shareholders that can sometimes be irreparable. Sometimes, shareholders may feel the board of directors has acted in a manner that benefits the board and not the company as a whole. So, it is best for members of a board of directors to understand their duties.

Generally, the corporate powers, business, and property of a corporation must be exercised, conducted, and controlled by its board of directors. Lisle v. Shipp (1929) 96 Cal. App. 264. A corporation does not act through individual directors; rather, it acts through its board of directors. Lomes v. Hartford Financial Services Group, Inc., (2001)105 Cal.Rptr.2d 471. …but it is generally intended that the officers as a group shall be person who execute the decisions of the board of directors and who are always subject to the control of the board. Because of this power in the board and officers, they are held to the highest degree of care and loyalty toward the corporation and its shareholders.

California Corporations Code section 309 states in part:

A director shall perform the duties of a director, including duties as a member of any committee of the board upon which the director may serve, in good faith, in a manner such director believes to be in the best interests of the corporation and its shareholders and with such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances.

As one court has stated:

This Court has traditionally and consistently defined the duty of loyalty of officers and directors to their corporation and its shareholders in broad and unyielding terms: Corporate officers and directors are not permitted to use their position of trust and confidence to further their private interests. . . . A public policy, existing through the years, and derived from a profound knowledge of human characteristics and motives, has established a rule that demands of a corporate officer or director, peremptorily and inexorably, the most scrupulous observance of his duty, not only affirmatively to protect the interests of the corporation committed to his charge, but also to refrain from doing anything that would work injury to the corporation, or to deprive it of profit or advantage which his skill and ability might properly bring to it, or to enable it to make in the reasonable and lawful exercise of its powers. The rule that requires an undivided and unselfish loyalty to the corporation demands that there be no conflict between duty and self-interest.

Cede & Co. v. Technicolor, 634 A.2d 345 (Del.1993)

A corporation’s attorney acts on behalf of the corporation, not on behalf of any subset of the corporation. Skarbrevik v. Cohen, England & Whitfield (1991) 231 Cal. App. 3d 692. Even where counsel for a closely held corporation treats the interests of the majority shareholders and the corporation interchangeably, it is the attorney-client relationship with the corporation that is paramount for purposes of upholding the attorney-client privilege against a minority shareholder’s challenge. Hoiles v. Superior Court (1984) 157 Cal. App. 3d 1192.

Where a corporation’s board of directors, or officers and managers, breach these duties, they can be held liable to the squeezed out shareholders, or to the corporation for their wrongful conduct.

The post Duties of Members of the Board of Directors, Officers and Managers appeared first on The Law Offices of Brian Irion | Bankruptcy Attorney, Business Law, Real Estate Law, Litigation.

It helps to have a level playing field when litigating or arbitrating. The playing field is often set when the parties sign the contract. Once a business relationship has gone sour, it is too late. In short, it pays to closely examine the contract you are signing before you sign it. The “boilerplate” you agree to may place your company in a ballpark you won’t want to be in, or playing by rules you won’t like. At a minimum, consider the following:

Arbitration Agreements

Before blithely signing an agreement that contains an arbitration clause, consider carefully whether that is really in your company’s best interests. Arbitration is a different animal, with different costs, risks and benefits. Different arbitration companies have differing rules, locations, and other provisions.

Attorneys’ Fees

Under the American system of law, the loser at trial usually does not pay for the winner’s attorney fees unless a contract or public policy statute provides otherwise. Sometimes, an attorneys’ fees clause can keep a miscreant party from acting up, but sometimes, these provisions can cause disputes to erupt into litigation. A contract provision requiring the losing party to pay the other’s attorneys’ fees can cause the parties to be less likely to settle because they think they will win and recover their fees, although statistics show (and logic reasons) that this only happens half the time at best. Attorneys’ fees clauses should be considered and worded carefully both in scope and conditions under which fees would be awarded.

Exculpatory Clauses or Liquidated Damages Clauses

Contracts often limit the type or amount of damages that may be awarded to the non-breaching party. Sometimes these clauses are enforceable, sometimes not. California and other states have laws that restrict when a party may avoid liability for wrongful acts. Agreements avoiding liability, fixing damages, eliminating punitive or consequential damages, or shifting responsibility need to be crafted carefully.

Indemnity Clauses

Often, one party will seek to have the other agree to indemnify it if suit is brought by a third party. This often occurs in contracts such as work-for-hire contracts, consulting agreements and software licenses. The idea is that the party less responsible should not be the first to pay damages. These agreements can be constructive, but can be onerous unless carefully crafted, and take into account each party’s ability to indemnify.

Mediation Clauses

Once in a while, a contract requires the parties to mediate disputes before proceeding to litigation or arbitration. These types of clauses can be found, for example, in consulting agreements, real estate agreements and in some AIA contracts.

The post “Boilerplate” Contract Provisions in Business Transactions Need Careful Review appeared first on The Law Offices of Brian Irion | Bankruptcy Attorney, Business Law, Real Estate Law, Litigation.

Copyright Law protects original works of authorship fixed in any tangible medium, and derivative works springing from those original works. This definition is interpreted broadly to include protection for recorded songs, software programs and musical or theatrical performances, as well as art and literary works such as books.

The 1976 Copyright Act gives the owner exclusive rights to perform, reproduce, adapt, distribute or publicly display the work throughout the United States and its possessions. The duration of a copyright for works first created in or after 1978 is the life of the author plus 70 years, or 95 years from the date of first publication of a work for hire. Unlike trademarks which require registration before the symbol ® may be used, a copyright owner may use the copyright symbol © immediately upon creation of a work in a tangible medium. Presence of this mark on the work may help to show intentional or willful infringement in the event copying is shown.

Certain limitations exist to the author’s list of exclusive rights. For example, portions of a work may be reproduced or discussed in a “fair use” for criticism, parody, comment, educational uses or reporting. Also, the First Sale doctrine permits the owner of a copy of a work to transfer that copy without restriction by the original author. However, the first sale doctrine does not permit the owner of a copy to make additional copies. This “limitation on a limitation” fueled massive amounts of litigation involving what the RIAA and BSA claim is cyber piracy and file-sharers such as Napster contended is a legitimate use.

The rights afforded a copyright owner are transferable and may be licensed. The right to license has provided a burgeoning industry to lawyers, who regularly draft licensing agreements for software. Many large law firms have entire teams of lawyers devoted to “licensing law.”

Exceeding the scope of a license can have serious consequences, including not only breach of contract damages, but also damages for copyright infringement. These damages can include injunctive relief, actual damages measured by the owner’s actual damages and the infringer’s profits, statutory damages of up to $30,000 or even up to $150,000 for willful infringement, destruction of the illegal copies and molds, seizure of infringing articles by customs officials, and attorneys’ fees and costs (17 USC §501 et seq.) In extreme circumstances, criminal penalties can be imposed.

The post Copyright Basics appeared first on The Law Offices of Brian Irion | Bankruptcy Attorney, Business Law, Real Estate Law, Litigation.

Trademark law is often subdivided into trademarks, service marks, trade dress and trade names, although all have some features in common.

• Trademarks are words, symbols, phrases or designs, or combinations of these that distinguish the source of goods of one person from those of another (such as the famous Coca-Cola script lettering over the wavy red band.)
• Service marks are similar to trademarks except that the words, phrases or designs distinguish the services of one business from those of others (such as the AT&T mark for broadband data services.)
• Trade dress refers to the total image of a product and includes such features as size, shape, color combination or graphics provided they are non-functional (such as the appearance of certain model of sports car like a Lamborghini Countach.)
• Trade names are simply names used by a business to identify its business or vocation.

Trademark law is really an amalgamation of laws that protect a company’s name, products, and services from unfair competition, and protect consumers from false advertising. Trademarks, service marks and trade dress are protected under both federal law by the Lanham Act (15 USC §1051 et seq.) and under California law by the California Trademark Law (Cal. Bus. & Prof. Code §14200-14352). And, certain common law rights protect against the unfair competition of “palming off” one’s goods as another’s.

The procedures to perfect rights in a mark and remedies for infringement or dilution differ somewhat. Under the Lanham Act, a person with a bona fide intent to use a mark in commerce can file an application to register the mark. Under the California Trademark Law, a person must have used the mark in commerce in order to perfect rights in it. Registration provides constructive notice to potential users, protection to the registrant, and protection to the consumers who depend on the association between the mark and origin of goods.

The Lanham Act prohibits use of counterfeit or unlicensed marks in connection with marketing goods and services, but it also prohibits a much broader array of wrongs. It protects against dilution of famous marks, it protects domain holders from deceptively similar names (for example, ebay.com is entitled to protection against a domain entitled perfumebay.com.) It protects consumers against the “palming-off” of fake Gucci purses and handbags. And, it protects consumers against false designations of origin such as “Napa Wine.”

Certain marks may not be registered, or may be registered only under certain conditions. A mark that is generic may not be registered in the Patent and Trademark Office’s principal register (e.g., “muffin” is generic.) A descriptive mark, like “Napa Valley Wine” may achieve protectable status when a “secondary meaning” attaches such that consumers equate the product with a particular source or origin. A suggestive term (such as “Slickcraft” when applied to boats) may be entitled to protection without secondary meaning. An arbitrary or fanciful mark such as “Black & White” applied to whisky is inherently distinctive and will be afforded the broadest protections under trademark law. Lastly, one cannot register a mark already in use by another for the same or confusingly similar services or products.

Before a mark is registered in the U.S. Trademark Office’s principal register, the user of the mark may not use the symbol “®” (which is reserved for a registered mark) but may use “”. Once a trademark is acquired, it may be transferred with the goodwill of a company. It may also be lost by abandonment, failure to maintain quality control in licensees, through a showing that it was fraudulently acquired, by showing that others were using the mark in commerce before the registrant used it, and by other means.

Remedies for trademark infringement can include injunctions, destruction of infringing goods, impoundment of infringing goods, treble profits, damages and attorneys’ fees. Successful plaintiffs in “cybersquatting” domain name cases can also obtain the domain name wrongfully used the defendant.

While the United States Patent and Trademark Office has self-help pages in its website, care needs to be taken in the registration, classes of goods and services selected, and ownership, licensing and assignment of marks, as well as steps to maintain and enforce an owners’ rights, or those rights may be lost.

The post Trademark Basics appeared first on The Law Offices of Brian Irion | Bankruptcy Attorney, Business Law, Real Estate Law, Litigation.