Recent Blog Posts
- Regulatory Hammer Strikes Again
Gerald Faber, Shareholder of Stark & Stark's Employment, Business & Corporate and Real Estate, Zoning & Land Use Groups authored the article Regulatory Hammer Strikes Again for the June 9, 2008 edition of the New Jersey Lawyer. The article discusses a company's need to have a clear understanding of the Construction Industry Independent Contractor Act (CIICA), as well as the need for employers to follow the requirements outlined in the Act. Mr. Faber discusses the need for an employer to exercise control over the methods and quality of a worker's performance in order to maintain a positive and productive employment relationship. You can read the full article here. (PDF) .... - Contractors Be Warned: Don't Get Nailed
Michael J. Fekete, member of Stark & Stark's Business & Corporate group, authored the article Contractors Be Warned: Don't Get Nailed for the May 5, 2008 edition of the New Jersey Law Journal.Mr. Fekete's article discusses how contractors can avoid potential liabilities by complying with the New Jersey Home Improvement Contractors Act. While compliance with the regulations alone will not protect a contractor from claims regarding workmanship, adhering to the regulations will reduce the chances that litigation will occur. You can read the full article here. .... - How To Start A Business
Cary S. Kvitka, member of Stark & Stark's Franchise and Business & Corporate groups, will present a seminar in association with SCORE of Princeton, Counselors to America's Small Business. SCORE offers free and confidential small business advice to help you build your business from idea to start-up to success. The seminar will focus on what you need to know when starting a business. Mr. Kvitka will discuss: The pros and cons of the three options: buying an existing business; purchasing a franchise; or building your own business. Intellectual property issues, such as trademark or copyright concerns. How to negotiate commercial leases and other vendor contracts. You can access additional information, and registration information, here. .... - Ensuring the Benefit of the Bargain - Due Diligence for Business Acquisitions
Before purchasing a business, the proposed buyer of company should request and review extensive documents about the target company’s ownership, function, income, assets, obligations and liabilities. That process, called “due diligence” affords the buyer the last real chance understand exactly what he or she is buying. The importance of conducting due diligence in an organized and exhaustive way cannot be overstated. Failure to do so could lead the buyer to unknowingly purchase a company that is not viable under new ownership, or a company that is facing serious legal or financial issues. Therefore, to ensure the benefit of the bargain, the shrewd buyer should take full advantage of due diligence. Having represented clients in both local business and multinational corporate acquisitions, I’ve realized that the due diligence process for each is surprisingly similar. That is because no matter the size of the target company, buyers have universal .... - Collecting Prejudgement Interest on Debts
I am often asked by clients whether prejudgment interest can be obtained from debtors on unpaid claims. Prejudgment interest is usually awarded by the courts in New Jersey only when a written contract exists between the creditor and the debtor which includes a provision for the assessment of interest if payment is not received by the creditor in a timely manner. The written contract can be a simple as a purchase order or an invoice. However, some counties will not award prejudgment interest unless the contract is actually signed by the debtor. Prejudgment interest may run on contract claims not as a matter of right but rather in accordance with equitable principles. Absent, however, unusual circumstances the prejudgment rate should be the same as that provided for by the rule governing post-judgment interest. The current post-judgment rate of interest for 2008 is 5.5%. This rate is adjusted on a yearly basis. Equitable principles do not apply to the same extent where the parties .... - Buy-Sell Agreements in Closely Held Businesses
Virtually all small closely held businesses should have an up-to-date Buy-Sell Agreement. A Buy-Sell Agreement should accomplish a number of important objectives for closely held company, including: (1) providing mechanism for the orderly transfer of the business; (2) establishing a valuation mechanism which avoids disputes between owners as well as possible disputes with the Internal Revenue Service; (3) reducing possible disputes between owners, an owner’s heirs, and possible unwanted business partners to whom an ownership interest in the company may otherwise be transferred; and (4) providing financial security to a deceased or disabled owner’s family.It is important that company’s Buy-Sell Agreement be reviewed periodically to make certain that it is properly customized to the needs of the specific company and its owners, as well as to make certain the agreement meets the requirements of current tax laws. Two of the most important areas of periodic review are the .... - Rights of Suppliers under Bankruptcy Law
In light of yesterday's bankruptcy filing by Rockaway Bedding, suppliers to the retail chain need to be aware of how to proceed in protecting themselves for the goods they have shipped but not yet been paid for. Section 503(b) of the Bankruptcy Code allows administrative-expense status to all claims for "the value of any goods" received in the ordinary course of business by a debtor within 20 days before the bankruptcy filing. The supplier must request administrative-expense status. By doing this, the supplier is in a better position than unsecured creditors to be paid, since a Chapter 11 plan of reorganization cannot be confirmed unless administrative claims are paid in cash on the effective date of the plan. Unsecured creditors typically receive only a fraction of their claims. Suppliers of goods have another method to be paid ahead of unsecured creditors. They may seek reclamation of goods sold to a debtor in the ordinary course of business under Section 546(c) of the .... - The Enforceability of an E-Mail as an Agreement to Share or Transfer a Copyright
Businesses and individuals often engage in negotiations with regard to any number of issues through the forum of e-mail. Such negotiations pose a variety of risks because of the fact that the negotiations are in writing and could be used for purposes that the sender did not intend. For instance, the sender of an e-mail should exercise caution during preliminary discussions to transfer or share rights in a copyright. Even though the Copyright Act requires that any such agreement must be signed, there is a high probability that the Third Circuit would find that an e-mail satisfied such a requirement. The Copyright Act, at 17 U.S.C. 204(a), provides: A transfer of copyright ownership, other than by operation of law, is not valid unless an instrument of conveyance, or a note or memorandum of the transfer, is in writing and signed by the owner of the rights conveyed or such owner's duly authorized agent.17 U.S.C. 204(a). No cases specifically .... - Restrictive Covenant Agreements For Franchises
The growth and development of a business is generally dependent upon the efforts and dedication of its key employees. Such key employees can greatly contribute to the success of a business. Conversely, upon the termination of their employment, these same employees have the potential to negatively impact the company. Depending on his or her relationships with clients, a former employee can convince your company’s clients to leave the company and be serviced by the former employee’s new employer or company. The former employee can also solicit or encourage other key employees to leave the company. To minimize disruption to the company’s operations and client relationships, a company can be proactive and have the key employee sign an agreement agreeing to certain restrictive covenants: Confidentiality Agreements. While an employee of your company, the employee will likely become familiar with confidential and proprietary information .... - Wal-Mart Settlement Saves Company Money
Thomas Lewis, Chair of the Employment Litigation group, was quoted in Wal-Mart Mea Culpa Saves Company Legal Costs down the Road in Workforce Management magazine.Lewis commented on the settlement between WalMart and the Department of Labor concerning improper overtime compensation for thousands of workers.You can read the article here. .... - Comparing LLC's and "S" Corporations for Emerging New Jersey Businesses
For individuals starting a business, the form their business takes is important and hinges on their desire to protect their investment (limited liability), enjoy flexibility in management and administration, and the ability to maximize profit by paying taxes on earnings directly, rather than at the entity level and again individually on distribution. Before 1994, New Jersey businesses wanting limited liability without double taxation used “S’ corporations. After 1994, business owners could chose primarily between “S” corporations and the limited liability company (“LLC”). Before 1994, “S” corporations were preferred because of limited liability and flow-through taxation. For an “S” corporation to pay taxes through the shareholders directly, certain requirements are necessary. “S” corporations may only issue one class of common stock, other business entities and non-U.S. persons cannot be shareholders, and .... - Franchise Emphasizes Careful Growth
Adam Siegelheim, a member of the Franchise group, was quoted in One Chain's Groundwork for Growth in the January 8 Philadelphia Inquirer, which discussed the expansion of the New Jersey-based Saladworks franchise.You can read the story here. .... - New Jersey Legal Update - Podcast # 55
This week's New Jersey Legal Update podcast will discuss the use of objective standards in hiring practices. This podcast will also discuss the impact objective standards can have on a sexual discrimination case. This week's New Jersey Legal Update is presented by Jason Storipan, member of Stark & Stark’s Employment Group. You can download the New Jersey Legal Update Podcast # 55 here. (4.75 MB)Technorati Tags: New Jersey : Podcast : Employment .... - Securing Your Future Income
Stark & Stark and Cowan, Gunteski & Co. will be presenting Securing Your Future Income: What You Need to do Today in Order to Insure a Healthy Revenue Stream from Your Practice. The seminar will be held on January 30, 2007 at the Sheraton in Eatontown, New Jersey.The presenters, Allen Silk, Chair of Stark & Stark's Business Law group, Donald Cowan, Managing Director of Cowan, Gunteski & Co., and Deborah Mathis, Principal of Cowan, Gunteski & Co. will cover such topics as succession planning, practice valuation and retirement planning. Download the seminar information here. .... - Employee Handbooks
Thomas Lewis, chair of the Employment group, authored a chapter of Human Resources 2007: Answers to the Top 25 HR Questions in 2007 from Thompson Publishing Group. The chapter is entitled Employers Considering Whether They Should Implement an Employee Handbook Should Give Careful Consideration to a Myriad of Concerns.Read the chapter here.Technorati Tags: New Jersey : Employment .... - New Jersey Legal Update - Podcast # 49
This week's New Jersey Legal Update podcast will discuss the new bankruptcy code and how it affects creditors and franchisors. This podcast will address the creditor's treatment under the debtor's plan, the creditor's rights for reclamation of goods, and the debtor's assignment or rejection of the franchise agreement. This week's New Jersey Legal Update is presented by Thomas Onder, a member of Stark & Stark’s Franchise and Creditor's Rights Groups. You can download the New Jersey Legal Update Podcast # 49 here. (7.8 MB) Technorati Tags: New Jersey : Podcast : Franchise : Creditor's Rights .... - New Jersey Legal Update - Podcast # 48
This week's New Jersey Legal Update podcast will discuss the positives and negatives of creating an employee handbook for your company. This podcast will address the rising need for employee handbooks in the workplace, as well as a discussion of how to determine what policies and procedures should be included and how to include those policies and procedures in accordance with state and federal legal regulations. This week's New Jersey Legal Update is presented by David Krulewicz, a member of Stark & Stark’s Employment Litigation Group. You can download the New Jersey Legal Update Podcast # 48 here. (11.5 MB)Technorati Tags: New Jersey : Podcast : Employment .... - New Jersey Legal Update - Podcast # 45
This week's New Jersey Legal Update podcast will discuss recent cases pertaining to the franchise industry. This podcast will address the issues of restrictive covenants and franchise payment plans. This week's New Jersey Legal Update is presented by Adam Siegelheim, a member of the firm's Franchise Group, and John MacDonald, a member of the firm's Litigation Group. You can download the New Jersey Legal Update Podcast # 45 here. (11 MB)Technorati Tags: New Jersey : Podcast : Franchise .... - Enforceability of "Third-Party" Non-Competition Agreements
A new development facing franchisors is the specter of spouses, brothers, sisters and cousins of franchisees suddenly appearing on the scene with new franchise businesses during the time period of the initial franchisees’ non-competition agreement. Often, this “end run” in non-competition agreements has the same negative effect upon the franchisor as though the initial franchisee had breached his or her agreement. To combat this problem, franchisors have recently attempted to expand the number of persons who will be bound by the non-competition provisions of the original franchise agreement. Will this attempt actually yield results for franchisors? That has yet to be seen, but franchisors should be careful with their expectations regarding the enforceability of “third-party” non-competition agreements. In the franchise world, non-competition agreements typically enjoy more protection from the Courts because of the specific nature .... - Leveling the Playing Field in Franchising
Adam J. Siegelheim, a member of the Franchise Law group, authored Franchise Fairness for the July 31edition of the New Jersey Law Journal, Corporate Law Supplement. The article discusses the New Jersey Franchise Practices Act, which was designed to address the disparity in bargaining power between franchisors and franchisees.You can read the article here. ....
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