Pandora’s Box In Greek mythology, Pandora's box is the large jar (πιθος pithos) carried by Pandora (Πανδώρα) that contained evils to be unleashed on mankind — ills, toils and sickness — and finally hope. (Wikipedia)Greek mythologyPandorahope 2
Stop Now, I’m Covered 3 You know your legal issues are taken care of because your attorney is: Neighbor Relative Friend of a Friend Really expensive You use the same attorney for all business legal needs because all attorneys are the same. (Like going to a podiatrist for brain surgery). Your business needs the right specialist at the right price.
Legal Audit 4 You and your business need a legal risk analysis. Why you? You run the business and your legal issues can have a profound effect on the business. Is the business your family name? Do customers, suppliers, and the media see the business as you and you as the business? Are your actions seen as the actions of the business?
Legal Audit 5 Have you and other owners created an estate plan? For multiple family owners, do your estate plans integrate? Do you have a succession plan if something happens to you? Are you grooming that successor and others?
Legal Audit 6 Is your business protected and compliant? Contracts: In writing? Negotiated by someone who understood both the business and legal issues? Are they enforced or sitting in a desk waiting for a problem to arise? Centrally located or scattered in everyone’s desk drawer? What do they provide for on a change of control?
Legal Audit 7 What is your intellectual property? Trademarks, patents, copyright? How is it protected? Are your competitors infringing? Are your competitors’ advertising misleading your customers about your product? Are you infringing someone else’s IP?
Legal Audit 8 Are your employees properly trained on your policies and procedures? Sexual harassment training? Whistleblower policy? Corporate Code of Conduct policy? Who has employee personnel files? Do managers have their “own” files in their drawers? Do employees know the difference between business information and their personal information?
Legal Audit 9 Do you have a document retention policy? When was the last time you set aside a “destruction” of documents day? If your building burned down, where are your records? Do you back up your records? How often? Is the backup off site? When you receive notice of a potential claim (litigation) are all destruction of documents put on hold?
The Submarine: What keeps “pinging” you? 11 Do you have a really good employee, officer, director, or partner who is key to the business, but he/she has a “fatal” business flaw? How do you handle such an employee or business partner? Your CFO is not the best at what he does, but he is a great guy and a 3 handicap. You assume he knows what he is doing. Your property has a gas plume from the neighboring gas station under your building. Is that a problem?
The Submarine: What keeps “pinging” you? 12 Your business is growing and you would like to have experienced input, but you don’t have time to set up a Board of Directors. You have a BOD, but you never have time to set formal meetings with an agenda and deal with issues. You would like to have an advisory BOD.
The Submarine: What keeps “pinging” you? 13 I know we are insured, but how do I know if it is enough or too much? You have a product recall issue. Who do you rely on and how do you handle it? You were thinking a “quality issue”, but now CNN and the regulatory agency are on the phone. What do you say? How safe is your building and how protected are your employees if someone comes to the office with a gun?
The Depth Charge: What Issue(s) Can Take Out Your Business? 14 Your building is near a major highway, river, RR tracks, and airport. Are you prepared for disaster? Were Cedar Rapids, IA or New Orleans, LA? When you started your business you dealt with many people on a handshake. Now the parties have a different memory of the “agreement.” What to do?
The Depth Charge: What Issue(s) Can Take Out Your Business? 15 Your star quarterback heard you entertained offers to trade him. Now he demands a trade. Do you have a “face” of your business who can get upset and leave? You provide a Christmas party to all employees. Alcohol is served and someone has a serious accident on the way home, killing several people. When you registered your trademark, your attorney forgot to register it in Canada.
The Depth Charge: What Issue(s) Can Take Out Your Business? 16 Your giant competitor keeps making false and misleading advertising about your business or your product. What do you do? You want to do business internationally, but you don’t know where or how to start. Do you have a bank line of credit? Do you know the terms of the loan and the covenants you agreed to? What if you breach a bank covenant? What does that matter? You did not know the guy you hired had a previous sex offense and a customer is alleging he raped her.
The Depth Charge: What Issue(s) Can Take Out Your Business? 17 Your product was purchased by the buyer and then damaged in buyer’s warehouse fire. Buyer’s insurance paid the claim, took the product, and sold it to a salvage liquidator. Your damaged product is now for sale in the open market. During manufacturing you had a “glitch.” You now need to retrieve a portion of the product. Do you have tracking codes for all product to clearly identify the damaged product and do you know where it was shipped?
The Depth Charge: What Issue(s) Can Take Out Your Business? 18 You and your franchisee was just sued. The customer says he relied on your web site to hire the franchisee. Are you protected? A franchisee started another business several years ago and is taking profit out of the franchise and loading it with costs. What do you do? Your franchisees are saying you over promised and under delivered. How do you respond a) in court, b) in the court of public opinion?
The Torpedo: Crisis Mode 19 You have been in your building for two years, but a huge snowstorm is collapsing your roof. The fire department just condemned your building. You can’t even go in to grab the laptops. What do you do and where do you go to keep your business running? You relied on your CFO for all of the financial reporting documents, even though you signed your name to them. They looked good from your perspective, but now an SEC investigator is calling. Do you take the call?
The Question 20 Your business is growing and you would like to sell it at some time. However, you never have time to get your house in order. Wonder what the lack of oversight by an experienced legal advisor will have on the value (sale price) of your business?
Hope 21 As with Pandora’s Box, there is hope. You are not the first business to deal with these issues and more. You need a trusted advisor, TRUSTED GC. I am here to share my years of business and legal experience to: Protect you and your business (although if in conflict, my allegiance is to your business). Manage your legal affairs. Reduce your overall legal costs. Increase the value of your business.