How could a business be breaking the law?
With the vastness of the legal system, it is often difficult as a business owner to know if you are obeying all the laws. There are so many small laws that can be easily overlooked. Overlooking these laws could be very damaging to your business. Understanding some of the most common laws that business owners must follow could prevent future harm to your business.
In this post, we are going to highlight some of the most common laws that can be broken as a business owner. Highlighting these laws can bring awareness and understanding to a business owner.
Collecting Sales Tax
To begin, business owners sometimes do not report or collect sales tax. This can be a common occurrence especially if you are selling online. It is hard to charge different sales tax depending on where the purchaser resides. However, this law will only apply if your business has some sort of physical connection to the state of the purchaser. On the other hand, you must always collect and report sales tax if you are a brick and mortar store selling to individuals in your state.
Infringing Intellectual Property Rights
Infringing a third party’s intellectual property rights could occur without you knowing. It could happen in the way you package a product, market a product, or even build a product. Being vigilant about competitors and their products, could allow you to avoid an infringement lawsuit. For example, you could create a brand name or a slogan that is so similar to another company that could lead to a lawsuit.
You may be able to use the work of another in the form of a trademark, patent, copyright, or a trade secret. However, you must first seek a license from the true owners of these property rights. A license is a legal right to infringe and be protected from potential lawsuits.
Litigation over infringement or failing to attribute work to another can cost thousands of dollars. A lot of money is spent each year trying to protect a business from intellectual property infringement. This could lead to a loss of your hard earned business. The saying, “an ounce of prevention is worth a pound of cure” rings true for infringement. Taking proper steps, such as using the USPTO and an Intellectual Property Attorney, can save your business.
Inhibiting Discovery During Litigation
It is important to note that during litigation you should be aware of all documents that may be used during discovery. At times, documents get destroyed, sometimes intentionally and other times inadvertently, which can impede the litigation. It is easy to delete an email or run some documents through the paper shredder.
Understanding that any document can be subpoenaed during litigation, can save you down the road. A good rule would be to not destroy any documents if you are being sued. This will allow you to be protected from inhibiting discovery during litigation.
Hour and Wage Statutes
There are federal and state laws that deal with wages and hour requirements. These laws need to be followed or lawsuits may follow. Sometimes it is difficult to know whether a salaried employee can receive overtime, because they are salaried. Also, knowing the hour limits for your workers and the amount they have to be paid is necessary to avoid issues under state or federal laws.
Usually, this is a simple law to follow due to the fact that most business owners are aware of the more basic wage and hour laws. However, more attention should be paid to the nuances between state and federal laws and how to cope with them as a business.
Untruthful About Items on Taxes
Sometimes it is tempting to adjust, itemize, or use certain deductions on your business taxes to receive extra relief. Taking this route can be safe if the things recorded are in fact the truth. If not, then you may find yourself and businesses dealing with the IRS. Making good decisions and using an experienced accountant can allow you to make the best decision for you business. You will still be able to save where it is legal, but also protect yourself from making any incorrect filings.
Being Aware of New Laws
Not only does a business owner have to comply with all presently passed law, but they must be aware of new laws. You must understand how these laws will affect your business in order to stay on the right side of the law. It can be difficult knowing the new laws, especially if they are state or even small local laws.
Every business owner has control of their business. They make decisions daily for the well being of their business. Also, this means that all of the above laws that can potentially be broken by a business are in the control of the business owner. The owner can choose to be vigilant in understanding all the necessary laws to keep the business afloat.
Which kind of business attorney you should hire if you break the law?
Knowing which type of business attorney you should hire can save you time and money. Attorneys usually specialize in certain areas of the law. For example, a business attorney may litigate business and intellectual property matters as well as perform some transactional work, like contracts and negotiations. Business litigation is very broad, which is why it is important to find a business attorney with the experience that you need.
Understanding the issue at hand can allow you to make this decision quickly. For example, if you are dealing with an intellectual property issue, you may want to seek the assistance of a patent litigator or even a business litigator with experience in patent law. Patent litigators, or business litigators, will understand how infringement is analyzed within a court setting. Their knowledge is very specific to intellectual property, which is why using them for other issues would not be helpful.
As a business owner, you may also run into employment issues dealing with wage or hours worked. Thus, you would want to seek the assistance of an employment attorney or business attorney with that type of experience. This is why it is so important to understand the problem that you are faced with. Once the problem or issue is identified, then you can know what type of expertise is needed.
Often, many business litigators will handle many issues that a business is faced with. As discussed above, they can be employment, intellectual property, and many other issues. Due to the fact that business litigation is so broad, some of the litigators may have experience in one area while the other doesn’t and vice versa. Seeking the business litigator or other specific litigator for your issue will allow you to solve your problem in an efficient manner.