Daliah Saper speaks at Tech Cocktail Startup Mixology Conference
On Thursday, October 28, 2010, Daliah Saper, Principal Attorney at Saper Law Offices, LLC, addressed legal issues facing tech startups as part of the Heavyweight Professionals guest panel at the Tech Cocktail Startup Mixology Conference. The topics discussed included business entity formation, intellectual property protection, and prudent contract drafting. Watch the video below or scroll down to read some key takeaways:
1. Registering your business as an LLC gives you liability protection that a sole proprietorship does not. However, merely filing the Articles of Organization for an LLC does not grant you liability protection. You must also draft and maintain an operating agreement and proper business records.
2. A copyright registration protects creative expression. Copyright owners have the exclusive right to make copies of the work, distribute copies of the work to the public, prepare derivative works, perform the work publicly, and display the work publicly. Importantly, when hiring someone to do work for you, have that contractor sign a work-for-hire agreement. When properly drafted, this will ensure that you own the work products the individual or business creates for you.
3. Global Entrepreneurship Week is coming up and startup competitions such as Lean Startup Machine Chicago and Chicago Startup Weekend are just around the corner! What does this mean for you? Keep in mind, a partnership is defined as two individuals who come together for the purposes of making money. Unless agreed otherwise, money is split evenly between the partners. If you choose to continue working on your startup idea with your team, draft a partnership agreement where you spell out: 1) the shares of profits (or losses) each partner will gain or absorb; 2) each partner’s specific responsibilities; and 3) what happens to the business and its assets should a partner decide to leave.
4. Register your own domain. If a web development company is creating your website, make sure your domain is registered in the name of your startup and not in the name of the web developer. Should the relationship with the web developer sour you will not be held hostage.
5. Read everything you sign! However, if you don’t want to read a twenty page end user agreement right now, at least copy and paste the agreement into a word document to read it later. Don’t just click “I agree” and keep going.
6. An ounce of prevention is worth a pound of cure! Act like a prudent business from the beginning. Keep careful records, follow legal protocol, and protect yourself. Preempt liability for yourself and your business by utilizing appropriately drafted agreements, business entities, and legal advice to avoid pitfalls and protect your assets.