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Representing a Business in Virginia Courts

Virginia Code requires that a business retain an attorney to litigate a matter, whether it is criminal or civil, in a Virginia General District Court or Virginia Circuit Court. Virginia Code § 16.1-88.03 provides:

Nothing in this section shall allow a nonlawyer to file a bill of particulars or grounds of defense or to argue motions, issue a subpoena, rule to show cause, or capias; file or interrogate at debtor interrogatories; or to file, issue or argue any other paper, pleading or proceeding not set forth in subsection A.

While the statute provides for some nuance, the bottom line is that an attorney is required to do anything other than the most basic of filings.

This can present a variety of obstacles to a business. First, cost may be an issue for a low dollar amount claim, where the potential judgment may be equal to or less than the attorney fees. Second, a business that is sued may be forced to retain an attorney on short notice with little time for assessing potential attorneys. Third, a business that is not initially represented by an attorney may make missteps that are difficult to recover from later in the course of litigation.

With these potential concerns in mind, a business should consult with attorneys and develop a solid working relationship prior to the onset of litigation. Meaning, find a good attorney who works for your business now, whether you think you may need an attorney or not. If you need a consultation for your Virginia business representation needs, contact our office to arrange for a consultation.

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Pitfalls to Avoid when Advertising for your Virginia Business

The Telephone Consumer Protection Act (TCPA), 47 U.S.C. § 227, prohibits a business from advertising through unsolicited text messages.  While the no-call list and other protections regarding telemarketers are more generally understood, technology and cost have made lesser understood mass-text-based options more accessible to businesses.  With this rise in use, plaintiffs’ attorneys have started to crack down on abuses, which can be costly to a company.

For example, a Class Action suit is pending in Southern Florida over the unsolicited use of mass-text advertising by a realty company.  Other similar suits are likely to follow.  The National Association of Realtors has a helpful guide to the TCPA and texting in this video.

Before your Virginia business launches any new advertising campaign, regardless of whether it implicates the TCPA, consider a brief consultation with your business attorney.

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When Your Business Has an Unhappy Customer

The axiom is that the “customer is always right.” But any business knows that this may be a sound policy to press upon employees, but it simply is not always practically or legally possible. Nor can every Virginia or Washington, D.C, business simply afford to accede to every customer demand.

In assessing how to handle a customer complaint–particularly as the complaint moves beyond cold coffee and into the realm of potential litigation–the business must know (1) what are its rights and obligations and (2) what is the practical consequence of the intended response to the customer.

Not every legally permissible option is a good long-term business decision. Growing businesses know all too well the danger of negative online customer comments and reviews, regardless of whether a complaint or review is accurate or whether the business has since remedied the issue. Conversely, not every practical option is legally permissible or wise. For example, the rush to address the customer’s concern may implicate other criminal and civil liability concerns down the road.

When deciding how to handle a customer complaint, a vendor dispute, the threat of a lawsuit, or other challenging Virginia or Washington, D.C., business concerns, contact experienced Virginia legal counsel to discuss all of your business’s options before rushing to action. A brief consultation with counsel to discuss an appropriate response and strategy may save countless hour and dollars down the road if the matter is not handled most effectively at the outset.

To discuss your business’s legal needs with knowledgable Virginia and Washington, D.C., business counsel, contact our office today.

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Protect the Business You Have Built

As you grow your Virginia or Washington, D.C., small business into a thriving and successful enterprise, remember to take the time to legally protect what you have built.  Like insurance, it is essential that you spend a prudent amount of time and money to review your operation and ensure that you are properly protecting your assets, employees, vendors, and various other entities with which your business interacts.  Your small business’s reputation and financial future may be at stake.

Here are some helpful reminders about many of the legal questions that your small business should consider on an annual basis:

  • Entity type: Do you have the optimal Virginia or Washington, D.C., small business entity type? Sometimes the small business entity type that you initially formed–whether due to legal administrative ease or otherwise–is not the best business entity for your current business.
  • Review your contracts: What do the contracts that you use on a daily basis actually say? Often closer review shows that your contracts do not say what you have always assumed that they do.  This can be very costly when a dispute arises down the road.
  • Non-compete agreements: Does your small business need to use non-compete agreements with its employees and contractors? Will the current non-compete agreement that you are using be enforceable?  Does it matter?
  • Employee legal grievances and lawsuits: Are you protecting your employees and your business from an employment law complaint? Plan ahead; don’t merely react.
  • Choosing an attorney: Are you working with an attorney and law firm that serves your business’s needs?

These are just a few of the issues that you should continually review, rethink, and re-address as your small business grows.  Contact the office today if you would like to discuss your Virginia or Washington, D.C., small business’s needs with an experienced and knowledgable law firm.

 

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What Does the Contract Say?

While it seems like a simple question, a contract’s terms are often overlooked until the parties are in the grips of litigation. Everyone has been through the process of initialing and signing a long contract full of boilerplate language that we all assume will never matter. But when a dispute arises, it is this fine-print language that has real-life consequences.

This is particularly true in business dealings; whether setting up a small-business operating agreement or entering into a long-term commercial lease, the language of the agreement and contract truly does matter. A responsible business cannot wait until the business is more established to take care of the details and it cannot simply sign and hope for the best.

Take the time now, before you face a conflict to review the terms of these contracts:

  1. Operating Agreement;
  2. Partnership Agreements;
  3. Employment Contracts;
  4. Commercial Leases;
  5. Insurance Agreements;
  6. Vendor Contracts;
  7. Client Agreements; and
  8. Any other contracts that your business enters into.

If you have any questions about your Virginia business’s or Washington, D.C., business’s contracts, contact the law office today to schedule an appointment.

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Starting a Virginia Business

Starting a business is an exciting and nerve-wracking experience. Whether the venture is meant to be big, bold, and long-standing or whether it is intended as a narrow, limited, temporary entity, the reality is that no one knows how the future will unfold. Every entrepreneur encounters unexpected issues that are good and bad. Likewise, they often end up working with a myriad of unforeseen contractors, employees, partners, businesses, and individuals.

Plan for the Future Now

Despite these unknowns (or perhaps in part because of them), new entrepreneurs often focus on their immediate broad goals and needs then leave the subtleties and details to be worked out later. Unfortunately, this is the wrong approach. Neglected details quickly and needlessly turn into headaches.

Although it is difficult, proper planning is an essential step if you want your Virginia business to prosper.  It helps maintain good relations with partners and vendors, and it maximizes your bottom line. Similarly, proper legal planning can help facilitate the business’s overall function. It will also help prevent problems or address them before they occur.

Questions to Consider When Starting Your Virginia Business

  1. What is the business activity?
  2. What is the current structure?
  3. Is the business registered already in another state?
  4. Where does it or will it conduct business activities?
  5. How many employees are there currently?
  6. How many owners, investors, and managers are there currently?
  7. What is your business’s exposure to liability?
  8. Can you insure against the risks?
  9. How many shareholders, partners, and managers do you anticipate?
  10. How many employees do you anticipate?
  11. What, if any, benefits do you intend to offer them?
  12. How long do you intend to run the business?
  13. What gross income range do you anticipate over the next few years?
  14. What are your retirement savings plans relative to the entity?
  15. How much time do you devote (full time or part time) to the entity?
  16. How important is administrative ease?

The answers to these questions will help guide the choice of entity (i.e., the type of business such as a sole proprietorship, LLC, PLLC, LLP, partnership, s-corp, c-corp, or  benefit corporation) and dictate the necessary paperwork, licenses, and other filings.

Taxes

In addition to the questions above, you should carefully consider taxes. The type of entity you form should be driven by, among other concerns, tax considerations. Likewise, how you will pay taxes, what taxes will be owed, and the impact of each employee, contract, or investment on your bottom line should be considered beforehand. Not only will these planning steps lead to a larger net profit, but they will keep the business and its owners out of trouble with the government–whether local, state, or federal.

Professional Legal Advice

With the advent of legal zoom and other online resources, it may be tempting to simply create your business entity through self-help and online filings.  While this may be appropriate for some enterprises–such as those formed by a limited number of experienced entrepreneurs–most people should seek legal counsel when forming a new Virginia business.  Similarly, you should consult with counsel early in the process so that mistakes or vulnerabilities can be identified and remedied early.  This will provide a peace of mind and net benefit to the company that will be as important as any other investment your new business makes.

If you are considering forming a new business in Virginia, please contact our office today to make an appointment.

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When Your Small Business Receives a Subpoena Duces Tecum

A subpoena duces tecum is a formal legal document instructing the recipient to produce certain identified documents, computer files, or other physical items.  Typically, a party to criminal or civil litigation serves this type of subpoena on a non-party in order to identify information helpful to the litigant’s case. There are various other types of subpoenas, such as witness subpoenas, that are not discussed here.  

Running a business is difficult and time consuming even in the best of times, so receiving a subpoena can understandably cause stress and confusion to a business’s officers and employees. This post discusses a few of the basic issues associated with a subpoena duces tecum. This post is not exhaustive, however, so always contact your attorney immediately upon receiving a subpoena. 

Initial Considerations

First, review the subpoena carefully to determine what is requested, who requested it, and the deadline to respond. Regardless of how you plan to respond, immediately issue a litigation hold to relevant employees to ensure that the requested documents or materials are not destroyed. Though it sounds like common sense, do not simply disregard the subpoena or put it at the bottom of your to-do list. Ignoring a subpoena can result in a contempt of court and monetary sanctions.

Written Objections

Second, consider how to respond. Just as a business should not ignore a subpoena, nor should it automatically comply without question. Under certain circumstances a business should object to a subpoena. There are both procedural and substantive potential objections. Some procedural bases for objections include improper service, service after the discovery deadline, and unreasonable response time. Possible substantive grounds for objections may include:

Relevancy: Information requested should be relevant to the subject matter of the underlying litigation and reasonably calculated to lead to the discovery of admissible evidence. 

Undue burden and expense: Compliance with a subpoena would cause an undue burden or expense to the producing party.  

Lack of possession, custody, or control: The responding party does not possess, actually or constructively, the requesting documents, nor are the documents within its custody or control.

Trade secrets and confidential business information: If a subpoena seeks documents that contain sensitive business information the business can object. If the requesting party demonstrates a substantial need, however, then production of such information may ultimately be required under the limits of a protective order.

Confidential personnel information: If an individual’s personal confidential information is contained in a requested document, the business should immediately notify such person of the request. The business may be able to object, or, the person whose information is to be produced may have to object. Notably, certain statutory requirements apply when an individual’s medical records are requested.

Privileges: In addition to the well-known attorney-client privilege, there are other privileges that may render a subpoena objectionable. For example, health care records made in connection with quality or peer review matters carry a special privilege.

Written objections must be served on the requesting party or attorney within a certain period of time after service. Failure to object within such timeframe may result in waiver of any objections. After serving timely written objections, the requesting party may move the court for an order to compel production. A court will not issue an order to compel unless the moving party has first made or attempted to make a good faith effort to resolve the matter with the other party. After a good faith effort at resolution by the parties, the business also has the option to move the court for a protective order to limit production. It should be noted that when a business makes written objections to a subpoena, it can still comply to the requests for which there are no objections, if there are any.

Motion to Quash or Modify

A business may also decide to make a motion to quash or modify the subpoena based on the same grounds listed above. A motion to quash or modify must be timely and it also requires that the parties first confer or attempt to confer in good faith to resolve their differences. Upon a motion to quash, the court may grant, deny, or modify a subpoena.

Finally, there are many considerations and pitfalls involved in responding to a subpoena duces tecum. Small businesses served with a subpoena should conduct a step-by-step analysis of the subpoena from both a procedural and a substantive perspective. An attorney could be invaluable to this process and should be consulted immediately to help protect your business.

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Check before you fire your employee

For most small businesses the hiring and firing processes bring some of the business’s trickiest and most important moments. On the one hand, hiring an employee, while bringing legal responsibility and potential legal liability, is a positive sign of growth and potential for the business. On the other hand, firing an employee may be one of the most difficult decisions the business makes and it can be fraught with potential legal issues. This blog post only discusses issues relevant to the firing process.

One of the most common small business questions our office receives is “how do I fire an employee without getting sued?” In short, the default rule is most employees are employed “at will” and the business can fire the employee at any time without cause. While this is generally the case, there are numerous exceptions carved out by federal and state law.

Illegal Discrimination

Various anti-discrimination laws prohibit an employer from terminating the employment of an at-will employee based on some specific characteristics of the employee, including, the employee’s race, sex, religion, national origin or color; in some cases the employee’s age; the employee’s disability, genetic information or family medical history; the employee’s military service; the employee’s marital status and in some cases the employee’s pregnancy, childbirth or related conditions, such as lactation. 

Retaliatory Discharge and Discharge Against Public Policy 

An employee may have a wrongful discharge claim if he or she is fired for exercising a right that is protected by law, such as filing a Workers’ Compensation Claim. Employers are also prohibited from firing an employee for a reason that violates public policy, such as requesting to take leave under the Family Medical Leave Act, or filing a health or safety complaint against the employer.

Employment Contract

Of course, if the employee has a contract with the employer the “at-will” may be modified by the contract and the employer will have to abide by the terms of the contract. Some employers may find themselves in the difficult position of having unintentionally transformed an at-will employee relationship into a contractual one.   For example, under limited circumstances, an employer’s oral assurances regarding the length of employment can potentially result in an implied contract for employment. Employee handbooks or other documents containing written policies regarding the duration of employment may also constitute an employment contract thereby eliminating the at-will default rule.

These are only a few of the exceptions to “at-will” employment–and there are exceptions to the exceptions, so it can get complicated.  Before firing an employee an employer should consider the circumstances present at the time of the proposed termination and discuss the matter with the company’s attorney before proceeding.

While there is no foolproof method to ensure that a former employee will not assert a wrongful discharge claim, there are steps employers can take to minimize such claims:

  1. Document issues with the employee. For example, document (whether internally or to the employee) any performance issues, such as, if the employee shows up late routinely, the employee is rude to customers, or the employee does not have the requisite skills to perform the job. 
  2. Ensure that you are following your business’s employee handbook procedures and that you are treating your employees equally and applying your policies and standards consistently.
  3. Make sure your employee handbook contains explicit language informing the employee the position is considered at-will and neither the contents of the handbook nor any other employment-related documents are intended to change that status.
  4. Communicate with the employee regarding any job fulfillment issues.  A common complaint (and impetus for pursuing litigation) from recently-fired employees is that they did not know that the business was not satisfied with their performance.  That is, no one ever said, “you aren’t performing to the expectations and requirements; improve or you will be fired.”  While this is not a requirement, it certainly helps—particularly if it is documented.
  5. Follow the law!  Employers often get into legal trouble when they, in fact, break the law. 

While every situation is different, you should always consult with your attorney prior to firing an employee. Thinking through the legal implications ahead of time can often save a lot time and money down the road. Running a small business is hard enough without having to litigate a former employee’s wrongful discharge case.

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Spring for Alexandria Update

Here is a Spring for Alexandria update from the Alexandria Bar Association’s Young Lawyers:

As an opportunity to give back to the local community, the Alexandria Bar Association’s Young Lawyers are fielding a team for Spring for Alexandria’s 7th Annual Community Service Day.  The volunteer event will be on Friday, May 16 from 12:30pm to 4:15pm. THERE IS STILL TIME TO SIGN UP! 

Our team, along with the Sheriff’s Department, has been assigned to brighten up living spaces for seniors In Old Town at 300 Wythe Street. There will be numerous projects to work on, from painting to landscaping. We take all experience levels – so don’t be shy about signing up!

If you cannot attend, please consider providing a donation to this great event and Volunteer Alexandria.  All of the money goes toward the tools and equipment for this event and Volunteer Alexandria’s general fund (you can read more about Volunteer Alexandria here.  In addition to providing worthwhile support, we are competing with teams across the city.  So our fundraising tally will help us show that the Young Lawyers are active in and supporting the community.

Please consider helping as a volunteer or donor to this great community service event.

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Spring for Alexandria May 16

As an opportunity to give back to the local community, the Alexandria Bar Association’s Young Lawyers are fielding a team for Spring for Alexandria’s 7th Annual Community Service Day.  Here is what the group had to say about helping out:

The volunteer event will be on Friday, May 16 from 12:30pm to 4:15pm.  Consider helping out if you can. Each team will be assigned a project at a local charity, park, or other similar location in need of repair-which will enable the team to provide hands-on assistance to individuals and organizations around the city. This is a great opportunity to get out of the office, learn more about the community, and do some good with your fellow young lawyers.

 

 

  

There are two ways you can help.  First, visit our team page and sign up to volunteer with our team on May 16.  Spring for Alexandria requests a $25 donation, but it is not required-we are focusing on volunteering more than fundraising, so sign up as a volunteer if you can.  The deadline to register as a volunteer is May 1, so sign up here today.

 

Second, consider providing a donation to this great event and Volunteer Alexandria.  All of the money goes toward the tools and equipment for this event and Volunteer Alexandria’s general fund (you can read more about Volunteer Alexandria here).  In addition to providing worthwhile support, we are competing with teams across the city.  So our fundraising tally will help us show that the Young Lawyers are active in and supporting the community.

 Consider helping out if you are willing and able.

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