Commercial Law Articles | Fremont, Hayward, San Leandro, Milpitas

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Buying a California Business

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Buying an existing company is a great way to enter the market with an established customer base. You can obtain financing more easily, benefit operationally from existing systems and processes, and rely on the deep knowledge base of established employees. It may also be less risky than starting a business from scratch.

However, the risks of liability in purchasing a business are great. When you purchase all or substantially all the assets of a business OR you purchase the business as a whole, the liability of the business flows through to you. Some risks can be mitigated by a corporate shield, but some cannot, and you will find that you are personally liable for any wages and taxes that were not paid by the prior business (even if you did not know about them).

If you are looking at buying a business, the first thing you need to do is evaluate the business as a whole and make a list of pros and cons. This also means digging deep into the company’s financials.

Regardless of the price you are paying for a business, there are three things you should do when evaluating a business for purchase:

Hire an attorney. A California business lawyer can help you draft the purchase agreement to expand your rights during the due diligence process. A good purchase agreement incorporates the right to walk away if you don’t like what you find during the due diligence period and get your money back if you discover that the company’s financials or business operations are problematic.
Always have a business escrow. Including a business escrow in a purchase agreement, where the contract is provided to the escrow company, will help you minimize unknown risks when purchasing an established business. It means that all money is deposited into the escrow company and all debts of the business are paid through the escrow company so that when you close the business purchase, you will receive the business and its assets free of unknown liabilities.
Never waive the bulk sale requirement. Sending bulk sale notices to all creditors including the taxing authorities, that the business assets are transferring, limits the time for creditors to put forth a claim. In an Asset Purchase Agreement, known and unknown liabilities do not transfer to the buyer, if noticed through a bulk sales notice. However, in a business purchase, the business would remain liable for any debts owed by the business post sale.

If you are buying a business in the East Bay Area including Fremont, Hayward, Union City, Milpitas, or Newark, California, protect yourself. Seek legal advice from an experienced business lawyer today.

assets, business, purchasing a business

Will a T-Mobile/Sprint business merger get approved?

Two major U.S. wireless carriers are reportedly almost ready to submit a proposed agreement to antitrust regulators for approval. This mega business merger between T-Mobile and Sprint is projected to draw negative comments from the current presidential administration as the antitrust regulators adamantly expressed disapproval of proposed AT&T/Time Warner merger earlier this year. If approved, the T-Mobile/Sprint deal will create a combined company valued at approximately $146 billion. California residents considering stock purchases in either of these companies may want to stay updated on the situation.

Telekom currently owns a major portion of T-Mobile and would reportedly have controlling interest in the new company if the business merger takes place. Sprint and T-Mobile have always been fierce competitors. For the past four years, they’ve been discussing a plan to combine efforts to take on other telecommunications giants, such as those mentioned earlier in this post.

The public would hold approximately 31 percent of the shares in the new company if the merger goes through. Company leaders say the new company would provide an unsurpassed network experience for its customers. As it stands, T-Mobile and Sprint have combined liabilities totaling $60 billion.

Not every potential deal between two or more companies involves assets worth more than $100 billion. However, even mergers that take place on much smaller scales can significantly impact productivity and profitability within their respective companies. In fact, some mergers keep companies from going under and propel them toward future success by expanding their sizes and making them stronger competitors. To avoid major delays and obstacles in a proposed plan, it is always a good idea to have someone well-versed in California business and commercial law on hand to address any issues that arise.

tech business merger, telecom mergers

Three Labor Laws Every Employer Needs to Know

With unemployment rates hitting record-breaking lows and startups growing all around the Bay Area, companies in the Silicon Valley can’t fill roles fast enough. Whether you are planning to grow your team or hiring for the first time, our labor and employment attorney is an expert on the ever-changing laws. Here are three new employment laws to consider and tips for ensuring you are compliant:

Salary History Ban – Per section 432.3 added to the Labor Code in October of last year, employers may not request salary history, nor may they base a salary offer on an applicant’s salary history. Before your candidate search, our employment lawyer can caution you on the crucial topics you can and cannot discuss during the interview process and throughout the tenure of your employee.
Minimum Wage – According to MW-2017 which went into effect this year, minimum wage for companies with 25 or fewer employees is $10.50 an hour and for companies with 26 or more employees, it’s $11.00. Our labor law firm can help you not only ensure you are compliant with the most up to date minimum wage, but also how you can prepare for the slated increase to $15.00 an hour by the year 2023.
Sexual Harassment Prevention – SB 1343 (an amendment to Sections 12950 and 12950.1 of the Government Code relating to employment) states that companies with 5 or more employees are required to train all employees on sexual harassment prevention by January 1, 2020. What exactly does a training need to include? What sexual harassment documentation does a company need to have accessible to employees? Our trusted employment lawyer is an expert on these requirements and here to help you ensure your company abides by the law.

Labor and employment laws change frequently, so we recommend all employers large and small, new and old, have regular legal consultations to remain lawful. To ensure your recruitment team and office space are set up for success, especially in Fremont, Hayward, Union City, Castro Valley, Milpitas, or Newark, CA, call Lynnette Ariathurai to schedule a consultation.

employment law, sexual harrassment, wage law

2019 New Sexual Harassment Laws

Beginning January 1, 2019, the California legislature adopted several laws in the workplace with regards to sexual harassment claims against employers. These laws will impact any employee claims that have not reached resolution, even though the cause of action, claim or lawsuit may have arisen prior to the implementation of the new laws. Staying up to date with the newest laws and implementing this knowledge correctly can save employers hundreds of thousands of dollars and countless hours in court. The most significant changes in the laws regarding sexual harassment are as follows:

1. SB 820 prohibits employer in a settlement agreement where sexual harassment, assault or discrimination has been alleged including a confidentiality clause prohibiting disclosure of the facts regarding the claim, except the victim’s identity.

2. SB 1300 makes non-disparagement agreements preventing employees from disclosing the unlawful acts in the workplace, including sexual harassment, against public policy.

3. SB 1300 also makes not enforceable, agreements not to sue or bring a claim against the employer under FEHA, in exchange for a raise or bonus, or as a condition of (continued) employment.

4. SB 1343 states that all employers with 5 or more employees are required to provide 2 hours of sexual harassment training to its supervisor, and 1 hour to other employees within 6 months of hiring and every 2 years thereafter. The initial training needs to conclude before January 1, 2020.

5. AB 2770 protects victim from claims of defamation by alleged harasser when employee reports sexual harassment based on credible evidence and without malice. Even if the claim is found to be false and the accused’s reputation is ruined.

6. AB 2770 also permits an employer to reveal to prospective employers on a job reference, the reason for employee’s inability to be rehired – if the employer determined that employee had engaged in sexual harassment.

Staying up to date on current employment laws is the easiest way to protect an employer. Often times employer thinks that just knowing the law is protection enough. My law office provides legal services in the best implementation of these laws, and dissolving confusion around the laws from the employers perspective. A consultation with an employment attorney can often save the employer time and peace of mind in regards to avoiding unnecessary litigation or tumultuous relationships with their employees.

I have represented a multitude of businesses in resolving claims against employers through pre-litigation, California and federal agencies, including the Labor Commissioner, EEOC and several others.

Litigation is sometimes the first notice of an allegation an employer receives, in which case a lawyer is even more pertinent and can be indispensable to that process. Every claim I have worked on has resulted in a satisfactory resolution for the employer, even in cases where initially there were stark differences in opinion. Settlements, although not always unavoidable, can be an option in which we can still reach a solution that satisfies the employer as well as discouraging future litigation from employees.

If your business is seeking information, guidance or protection for existing or possible sexual harassment claims in Fremont, Hayward, Union City, Castro Valley, Milpitas, or Newark, CA, please contact the Law Office of Lynnette Ariathurai.

california laws, employer responsibilities, sexual harrassment

New Supreme Court Ruling Impacts Companies with Independent Contractors

Companies desire to hire independent contractors rather than employees to save money on overtime pay, payroll taxes, and unemployment and worker’s compensation insurance, just to name a few benefits. But are companies taking advantage by misclassifying workers? Ride sharing and food delivery are a few of the big industries that retain independent contractors, but also within the tech industry, companies can independently contract software programmers, graphic designers, digital marketers and pretty much any kind of service-based freelancer. With technology making our world more interconnected, independent work is only getting easier and therefore the need for an employer to consult with a labor lawyer is more important than ever.

A new court ruling is dramatically changing the rules for how to determine whether a person is an employee or an independent contractor. So if you employ or are thinking about hiring independent contractors, our employment attorney can ensure you’re compliant with the most current labor laws. The Supreme Court ruling on April 30 (Dynamex Operations West, Inc. v. Superior Court of Los Angeles, No. S222732) is more clearly defining how workers are classified as employees or independent contractors. In order to be considered an independent contractor, a worker must be ‘free from the control and direction of the hirer in connection with the performance of the work.’ Based on this ruling, workers whose employers are directly connected to their work (such as drivers connected to passengers through ride sharing companies) cannot be classified as independent contractors and rather should be considered employees. This ruling seems to be directed at companies such as Uber and Lyft.

While companies save on financial obligations by retaining independent contractors, the legal responsibilities are crucial and penalties for misclassification can be severe. There are both civil and criminal penalties against companies and their owners/operators who wrongly classify an employee as an independent contractor.

Our full-service labor law office can not only help you understand whether any of your workers should be considered employees or independent contractors but can also ensure you have the proper contracts and documentation in place to retain your workers. With over 20 years of employment law experience, our labor lawyer is an expert in California labor laws.

Businesses in Fremont, Hayward, Union City, Castro Valley, Milpitas, or Newark, CA, can call to schedule a consultation with our employment attorney before hiring to understand how to legally employ independent contractors.

contractor vs employee, independent contractors

Business Dissolution To Come For Flash Memory Technology Moguls

On behalf of The Law Office of Lynnette Ariathurai, A Professional Corporationposted in Sales & Dissolutions on Tuesday, January 23, 2018.

NAND technology is a type of memory or storage system that does not require power to retain data as opposed to random access memory, wherein all data is lost upon computer shutdown. For years, Micron and Intel companies have performed as joint forces in development and promotion of non-volatile flash memory technology. It may come as a shock for many California readers to learn the two entities have announced their planned business dissolution.

The long-term partnership that is currently heading for business dissolutioncarries numerous implications for the world of technology. As it stands, most smart phones, tablets, personal computers and other devices heavily rely on NAND technology for data storage needs. Micron and Intel say they will finish working on 3D NAND technology slated for release in 2019.

Once the project is complete, the two businesses will part ways. In joint ventures of this nature, each entity typically provides specific strengths and specialized efforts to the centrally focused project. This means when two forces separate, each will likely have to compensate for the loss of the other.

Not many business owners would dissolve a successful, long-standing partnership without careful consideration. Profitability may be at risk. It is also conceivable that there may be additional expenses incurred in trying to fill in the gaps created by the absence of a former business alliance. This is why experienced business owners in California and beyond usually consult with experienced business and commercial law attorneys before taking any definitive action to separate from a long-term partner.

business dissolution

Contract Dispute May Render Group Of Elderly People Homeless

On behalf of The Law Office of Lynnette Ariathurai, A Professional Corporation posted in Contract Disputes on Thursday, January 18, 2018.

A group of families in another state are highly concerned about a contentious battle that remains ongoing between a Medicaid insurance provider and an assisted living and care facility. The situation involves a contract dispute that is negatively affecting elderly members of the families who happen to live in the assisted living facility. In essence, they’ve been told that if the problem is not resolved by a particular date, they will have to vacate their residences. Some readers in California may relate to the situation.

Younger family members of the residents have expressed their concerns, saying the notices those affected received in the mail were akin to possible evictions. Spokespeople for the nursing facility say they want nothing more than to peacefully and swiftly resolve the issues at hand so they can continue providing the highest level of quality care they have always provided for their residents. The central focus of the contract dispute between the personal care home and the insurance company has to do with residential rates.

The daughter of a 91-year-old resident says she’s very worried her mother will have to move far away from her if the current problem is not resolved soon. There are approximately 70 elderly residents who would be in similar circumstances if the nursing home and insurance company don’t achieve an agreeable solution. This situation is a prime example of how contract disagreements between specific parties often impact others who may not be directly involved in a particular contract.

A business and commercial law attorney can be a great asset when a negotiation problem or contract disagreement arises. An experienced attorney who is well versed in California business laws can advise a client as to what the most viable option available might be to get things back on track in the least stressful manner possible. Anyone in Florida concerned about a current contract problem can seek support by requesting a meeting with a commercial law attorney.

Contract Disputes, medicare

Quick Action And Negotiation May Solve Contract Dispute, Early On

On behalf of The Law Office of Lynnette Ariathurai, A Professional Corporationposted in Contract Disputes on Thursday, October 26, 2017.

Many people in California enjoy traveling by bicycle. In fact, San Francisco is a prime location for businesses catering to bicyclists, such as Ford GoBike, a bike sharing program that allows travelers to access bicycles inexpensively for personal travel throughout the city. This particular company says it has an exclusive contract with the city; unfortunately, a contract dispute has apparently arisen once word got out that the city’s transportation agency is planning to forge a deal with a Ford GoBike competitor.

In an effort to mitigate the contract dispute before things get out of hand, the Metropolitan Transportation Commission has initiated a dispute resolutions process. The MTC bases its actions on the threat of legal action regarding Ford GoBike’s allegations that the city is breaching an existing agreement. The MTC said that it has received word that the city plans to enter a contract with another bike share program; therefore, it believes problem solving techniques may help diffuse a potentially acrimonious situation if Ford GoBike decides to take the matter to court.

A notable factor in the situation is that Ford GoBike bore complete financial impact when it started its bike share program in the city. The company’s willingness to foot the entire bill (with no cost to the public) was primarily based on the agreement that it would have exclusive rights to running such a business in the city. Some say, if left unresolved, this situation could have a ripple effect in other regions.

Generally speaking, California company owners who work closely with experienced legal representation are often able to overcome their contract-related disagreements sooner than those who try to handle their own problems. A good place to start when seeking guidance about a particular issue is to request a meeting with an experienced business and commercial law attorney. It is better for the bottom line in the long-run if a dispute is resolved in as timely a manner as possible.

arbitration, Contract Disputes, negotiation

Attorneys Know How To Word Things To Avoid A Contract Dispute

On behalf of The Law Office of Lynnette Ariathurai, A Professional Corporation posted in Contract Disputes on Tuesday, June 13, 2017.

Business people in California and throughout the nation often enter written agreements with one or more parties to secure services, employment and/or other commercial transactions. When a contract dispute arises, it can cause immediate and long-lasting negative repercussions, including productivity delays and economic losses. Terminology used within a particular contract is often essential to the success of the agreement; therefore, it’s typically best to allow an experienced attorney to review a proposal before signing anything.

An business and commercial law attorney understands the importance of choosing words carefully when drafting a prospective agreement that will become legally enforceable. One or two words can make all the difference regarding each party’s obligations and responsibilities contained therein. To prevent a contract dispute, it’s crucial to make sure all parties understand and agree upon the chosen terms and phrases placed in writing.

Wording happens to be a main issue in a current contract disagreement in another state. The situation involves a group of educators who serve at least 13,000 students in their area. They want administrators to change contract terminology pertaining to employee transfers. They’re also fighting for an increase in long-term pay as their current starting pay is satisfactory, but they make nearly $5,000 or so less than area counterparts once they hit the 10-year mark.

Hiring a business and commercial law attorney to negotiate on one’s behalf and aggressively pursue all options available toward a favorable outcome is a smart move many California business people make. Those who hope to avoid a contentious dispute understand that experienced representation is often a key factor in achieving their goals. An attorney can provide many contract services, from actually drafting a proposal on a client’s behalf, to reviewing a prospective agreement or litigating a particular issue as needed.

Need help with contract reviews, creation, or representation? Please contact the Law Office of Lynnette Ariathurai, serving businesses in Fremont, Hayward, Union City, Castro Valley, Milpitas, or Newark, CA.

Contract Disputes, contract wording

Aggressive Representation May Help Resolve Contract Disputes

On behalf of The Law Office of Lynnette Ariathurai, A Professional Corporation posted in Contract Disputes on Tuesday, June 6, 2017.

Successful California business owners may relate to a recent disagreement that iPhone maker, Apple had with Finnish company, Nokia. The contract dispute has reportedly ended, but not without a struggle. Often, such situations can be diffused when a savvy business owner understands the importance of hiring aggressive legal assistance to negotiate (or litigate, if necessary) a solution.

The central focus of the Apple versus Nokia contract dispute was intellectual property. Apple told Nokia it would no longer pay for use of its patents. Apple also claimed Nokia committed extortion.

Nokia said many of Apple’s products, including iPhones, tablets and other electronic devices, contained its patented property and that Apple needed to pay for what it uses. When these types of disagreements arise, and a lot of money is at stake, tempers can become quite heated in court. Both sides are obviously trying to protect their own interests.

That’s where keen insight and experience can come in handy. A California attorney who knows the ins and outs of contract litigation can protect a business owner’s rights without compromising the bottom line. Those who wish to obtain the best results in the least amount of time possible typically hire aggressive representation to act on their behalves. Regardless of whether a particular business owner is fighting against accusations or is attempting to right a wrong that’s been committed against his or her company, retaining the help of a business and commercial law attorney is often a crucial factor in obtaining a successful outcome.

Contract Disputes, contract representation