13
CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR 1

CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

  • Upload
    felice

  • View
    50

  • Download
    3

Embed Size (px)

DESCRIPTION

CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR. CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR. Learning Objectives: Explore the Role of Law within Entrepreneurial and Small Business Environment Explain the Role of the Attorney Discover Areas of Concern When Leaving a Job - PowerPoint PPT Presentation

Citation preview

Page 1: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

1

Page 2: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEURLearning Objectives:

• Explore the Role of Law within Entrepreneurial and Small Business Environment

• Explain the Role of the Attorney• Discover Areas of Concern When

Leaving a Job• Determine Strengths and Weaknesses

of Legal Forms of Conducting Business2Chapter 7

Page 3: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

APPROACH TO THE CHAPTER

• “Business-Stage” Approach• Early-stage formation is a dynamic time for

any business, with complex challenges in both legal and non-legal realms

• Extended exposure to topics elsewhere in the textbook

Chapter 7 3

Page 4: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

LAW AND THE ENTREPRENEUR

Knowledge of the Law Serves to:– Minimize Risk– Improve Strategic Planning Process

4Chapter 7

Page 5: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

ENGAGING AN ATTORNEYA. Role of the Attorney

1. Reduce risks and amount of exposure for risks2. Provide strategic guidance

B. Finding Capable Legal Counsel1. Importance of Finding an Attorney with a

Background in Small Business/Entrepreneurship

2. Importance of Finding an Attorney with whom the Owner can Create a Solid Working Relationship

5Chapter 7

Page 6: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

ENGAGING AN ATTORNEY

C. The Attorney-Client Privilege1. Nature of the Privilege2. Parameters of the Privilege and How

it can be Lost 3. Determining Who is the “Client”

6Chapter 7

Page 7: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

LEAVING EMPLOYMENTA. Current Employees

1. Common Law Dutiesa. General Duty of Loyaltyb. Duty to Act Reasonablyc. Duty Not to Solicit Clients and

Customers of Current Employer2. Contractual Duties

a. No-moonlighting Clauseb. Confidentiality Agreement

7Chapter 7

Page 8: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

LEAVING EMPLOYMENTB. Former Employees

1. Common Law: Trade Secretsa. Role of Trade Secretsb. Definition of a Trade Secret

i. “Information with Independent Value,” andii. “Subject to Reasonable Efforts to Maintain its

Secrecy”2. Contractual: Agreements Not to Compete

a. Role of the Agreement Not to Competeb. Enforcing an Agreement Not to Compete

i. Majority of State: Test of Reasonablenessii. California: Forbids

8Chapter 7

Page 9: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

LEAVING EMPLOYMENT

C. Hiring Restrictions1. Nature2. Risks

9Chapter 7

Page 10: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

SELECTING THE APPROPRIATE LEGAL FORM

A. Preliminary Matters1. Types of Legal Forms

a. Sole Proprietorshipb. Limited Liability Companyc. Corporation

2. Factorsa. Limited Liabilityb. Income Tax Treatmentc. Controld. Financing

10Chapter 7

Page 11: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

SELECTING THE APPROPRIATE LEGAL FORM

B. Limited Liability Company1. History2. Use3. Characteristics

i. Limited Liability of Owners for Debts of Business

ii. Possibility of “Pass-Through” Income Tax Treatment

iii. Attraction of Angel Investors

11Chapter 7

Page 12: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

SELECTING THE APPROPRIATE LEGAL FORM

C. Corporation1. Use2. Characteristics3. Characteristics

i. Limited Liability of Owners for Debts of Business

ii. “Entity” Income Tax TreatmentI. ImportanceII. “Double Taxation” Notion

iii. Attraction of Venture Capital

12Chapter 7

Page 13: CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

CHAPTER 7: LAW FOR THE ASPIRING ENTREPRENEUR

13Chapter 7