Hopefully, you’ll never need to involve a lawyer into your business affairs. And hopefully, you’re not making business decisions based on hope. Realistically, there may be times when it’s necessary to bring in a hired hand who specializes in legal matters like drawing up contracts, incorporating, litigation and — worst-case scenario perhaps — bankruptcy.
Knowing which situations call for a lawyer and which call for rolling up your sleeves and going the “DIY” route is crucial, assuming, of course, your business cares about money. With that in mind, here are some examples of legal issues that can likely be navigated without a lawyer, followed by some that probably shouldn’t.
Starting a Business
If you can fill out an application, you can probably negotiate the licensing, permitting and registration processes required to do business in your state. The U.S. Small Business Administration offers a helpful explanatory guide to applying for your Employer Identification Number (EIN) on their website.
You might also require a DBA, or a “Doing Business As” name,” if your business is something other than your name. You’ll also want to make sure there is an available domain name before choosing a fictitious name. This can be done with some easy online searches.
Similarly, you can check for trademarks through the U.S. Patent and Trademark Office, which provides a search tool to see if your idea is available. If so, feel free to to claim it. Patents are a different animal (see below in the “get a lawyer” section).
Forming an LLC or a business partnership is an easy enough process that it doesn’t require a lawyer. With that said, you might consider consulting one to determine which type of structure is right for your individual needs. There are of course books on the subject, written for laymen (or dummies, to use the common parlance). There are also online guides that might be of assistance.
Most contracts can be done independently. Whether you’re creating a vendor agreement or a buy-sell agreement with your business partners, a lawyer is not necessary. Having said that, it doesn’t hurt to have your contract looked over to ensure there are no loopholes. The same can be said if someone else has drawn up the contract, and you’re looking to ensure that everything is in order.
There are times, bear in mind when you definitely want a lawyer.
It’s a fool who has himself for a client, right? If you’re being sued by a customer, a competitor or someone on your payroll, it’s time to lawyer up. Lawyers may be expensive but losing lawsuits can be even more expensive and might land you in legal hot water depending on the nature of the suit.
Forming a Corporation
A mom-and-pop operation is one thing, but if you’re planning on going public, it’s a bit more complicated. The maze-like tax code is designed so that only seasoned professionals can find their way through it.
Filing a Patent
Ever seen the “patent pending” label on a product? It’s a long process. Patent attorneys exist to aid in the long road to locking up a patent. In East Texas, a cottage industry exists on suing companies for patent infringement. Major corporations spend millions of dollars litigating among local juries friendly to their sue-happy lawyers who bring in big revenues to the local economy.
Buying and/or Selling a Business
If this doesn’t go without saying, let’s say it. Unless it’s the neighbor kid’s lemonade stand — no, even if it’s the neighbor kid’s lemonade stand — don’t come to the table without your lawyer. Luckily, you won’t need access to criminal defense lawyers. Chances are that lawyer may even be able to drive down Sally’s asking price after threatening to involve everyone from the local authorities on up to the Food and Drug Administration.
Ready for more?
Apply for funding and find out if you qualify today