The High-touch Legal Services® Blog…for Startups!

© 2009-2014 Dana H. Shultz, Attorney at Law

May a Minor Form an LLC?

Photo of happy kids, symbolizing that the answer to "May a minor form an LLC?" is "Yes."

This post – asking “May a minor form an LLC?” – is a companion to May a Minor Form a Corporation?

I have been wanting to write this post for more than two years, ever since writing the corporation post referenced above. However, as explained further below, I felt uncomfortable doing so because I was somewhat unsure of the answer. (more…)

What are Repeated and Successive Transactions?

Seal of the California Secretary of State, with which a foreign entity must register once it enters into repeated and successive transactions within the stateIn Doing Business in CA? Be Sure to Register, I discussed when a foreign entity must register to do business in California. The test is whether the entity has transacted intrastate business, i.e., has engaged in repeated and successive transactions of business within the state. This post explores the meaning of “repeated and successive transactions“.

Repeated and Successive Transactions” Not Defined

The term “repeated and successive transactions” appears in Corporations Code Subsection 191(a). Unfortunately, that term is not defined. However, another portion of Section 191 provides a bit of help. (more…)

Who Is Bound by a Pre-incorporation Contract?

Logo for Avvo, where Dana Shultz answered a pre-incorporation contract questionThis post about entering into a pre-incorporation contract is based on a question I answered on Avvo. See Can I legally speak as my company in things like terms & conditions if I have not officially registered the company yet?

The term “pre-incorporation contract” properly should apply only to corporations, because that is the only type of business entity that is incorporated. Other types of business entities, such as limited liability companies (LLCs), are formed, rather than incorporated. However, as is discussed below, a pre-formation contract (in California, at least) is treated like a pre-incorporation contract. See 02 Development, LLC v. 607 South Park, LLC . (more…)

Fraudulent Email Prohibitions Supplement CAN-SPAM

Cover of the California Business and Professions Code, which has a section about fraudulent emailIn Commercial E-mail and CAN-SPAM: What You Need to Know, I discussed how the federal CAN-SPAM Act makes commercial email more truthful, more transparent and more avoidable. This post addresses how California law concerning fraudulent email supplements CAN-SPAM.

In particular, this post discusses preemption, by which, under certain circumstances, U.S. federal laws can invalidate state laws that address a given subject matter. (more…)

Can Parties Enter Into a Perpetual Contract?

Logo for Quora, where Dana Shultz answered a question about entering into a perpetual contractThis post is about whether parties may enter into a perpetual contract (one that never ends).

It is adapted from my answer to a question on Quora. See Is it possible to structure a contract with no end date?

It turns out the the answer depends, to some extent, on which state’s law applies. (more…)

Directors’ Voting Rights Can Be Limited

Logo for Quora, where Dana Shultz answered a question about limiting directors' voting rightsThis post about limiting directors’ voting rights is based on my answer to a Quora question. (See Can a business owner draw up bylaws/articles of an organization that limit voting rights of directors?)

The incorporator or shareholders may approve a certificate of incorporation or bylaws that limit directors’ voting rights. (more…)

How Much Does It Cost to Obtain an EIN?

Antique cash register, symbolizing the cost to obtain an EINThis post about the cost to obtain an EIN (Employer Identification Number) in the United States is an Advertisement under Rule of Professional Conduct 1-400, Standard 5.

Recently I have received many inquiries from foreign owners of new companies in the U.S. They want to know how much it will cost to obtain an EIN. This post provides that information. (more…)

Trade Dress Protection for Look and Feel

Logo of Ingrid & isabel, plaintiff in a case about trade dress protection of website look and feelIn How Can I Protect the Look and Feel of My Website?, I explained that the “look and feel” of a website – or a smartphone – can be protected as trade dress or by a design patent.

This post examines a recent case that discusses the elements of trade dress protection in detail. That case is Ingrid & Isabel, LLC v. Baby Be Mine, LLC, decided by the United States District Court for the Northern District of California. (more…)

What is Successor Liability and Why Should I Care?

Logo for Quora, which was the inspiration for this post about successor liabilityThis post about successor liability is prompted by a question that I answered recently on Quora. (See Can I dissolve my corporation and transfer its website to my personal ownership?)

The following is oriented somewhat toward California law, but similar considerations likely apply in other states. (more…)

Good Faith and Fair Dealing – Part of Every California Contract

Logo of Baskin-Robbins, party to case about implied covenant of good faith and fair dealingThis post discusses and explains the covenant of good faith and fair dealing.

For decades, courts have held that this covenant is implied in every California contract.

Purpose of Good Faith and Fair Dealing

In 1942, the California Supreme Court stated that “in every contract there exists an implied covenant of good faith and fair dealing.” The intent of this covenant is that “neither party shall do anything which will have the effect of destroying or injuring the right of the other party to receive the fruits of the contract“. (Universal Sales Corporation v. California Press Manufacturing – emphasis added.) (more…)