Articles Tagged with corporatelaw

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Eventually, you’ll run into some kind of dispute while running your business, and that dispute can develop into a lawsuit if you don’t settle it promptly. Some of the most common causes of commercial litigation include the six items discussed below.

1. Breach of Contract

Over the course of running your business, you’ll make agreements with multiple parties, including vendors, licensees, employees, and other business partners. Occasionally, one party may breach the agreement. In other instances, there may be accusations of a breach where none truly occurred, or it might be unclear.

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A fiduciary is defined as any person or party who acts on behalf of another party. As such, they have a duty—referred to as a fiduciary duty—to put their client’s interests above their own. Often, this involves the management of other people’s money, such as a shareholder’s investment in a company or the funds placed in a trust.

Role and Duties of a Fiduciary

Put simply, the duty of a fiduciary is to look after the best interests of their clients, even if that means putting the client’s interests above their own. For example, a trustee has a fiduciary responsibility toward the beneficiaries of the trust, and therefore must manage the trust in such a way that it benefits the estate beneficiaries rather than their own selves.

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In many vehicle accidents, the matter of fault is more or less clear—the person who caused the accident is typically considered to be responsible for paying damages. However, that may not be the case if the accident involves a company vehicle.

If you were involved in an accident with someone driving a corporate vehicle, their employer may be held responsible for paying damages.

Determining Fault in Vehicle Accidents

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The surging demand of ESG (environmental, social, and governance) criteria has made impact investing more common. At the same time, it creates more exacting standards for corporations and brokerage firms to comply with.

About Environmental, Social, and Governance (ESG) Criteria

ESG investing—also known as impact investing, sustainable investing, and socially responsible investing (SRI)—is the practice of investing in organizations that follow environmental, social, and governance criteria. These investors want to contribute their funds toward companies they feel act responsibly, and certain criteria are used to measure that.

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Corporate governance is an integral component of running a business, particularly when it comes to maintaining compliance with legal standards and keeping company leadership accountable. Employees are often affected by decisions made with respect to how a corporation is governed, but they typically don’t have much say in the matter.

Here, we’ll look into the role employees can have in corporate governance and how they can impact it in a positive way.

The Interest Employees Have in a Company’s Success

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Corporate governance is an important topic for any business, but it can be especially important for new startups looking to secure investment funds. Additionally, it’s also a key point for established private companies that are looking to go public. The reason for this is investors place a great deal of importance on effective corporate governance when deciding to buy shares from your organization.

Why Corporate Governance Is Important to Investors

Ultimately, investors want to be sure they get a return on their investment. As such, they need to be reasonably certain that your company is safe to invest in. That means your company needs to be stable, reliable, and characterized by a high level of integrity. Effective governance helps ensure all of those.

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Normally, those who own or manage a corporation or LLC are not personally liable for business debts. However, there are circumstances where that limited liability is lifted. Those instances are referred to as “piercing the corporate veil.” In other words, the shareholders, members, and owners of the corporation are considered to be personally responsible for the liabilities of the business.

Limited Liability and Business Debts

As stated, a corporation or limited liability company (LLC) provides limited liability protection to its owners, members, etc. in that it is treated as a separate entity in the eyes of the law. Put simply, the business, not its owners, bears the responsibility for its own debts.

The recent bill H.R. 3684, also known as the infrastructure bill, has been hotly debated in the Senate. The bill requires massive amounts of funding, and one of the ways lawmakers are trying to secure those funds is through cryptocurrency brokers. Specifically, the bill would require brokers who deal in digital assets to report customer information, though many have argued that the way it defines “broker” in this sense is too broad.

As it makes its way into the House of Representatives, many people in the crypto-trading space are uncertain about what the bill means for their industry.

Return Requirements for Brokers

Most businesses derive a great deal of value from their intellectual property. As such, when someone infringes upon your IP rights, it’s important to be able to defend them. However, that doesn’t always require a lawsuit. IP litigation can be expensive, so alternative dispute resolution methods are often preferred.

Following are a few ways to quickly resolve an IP dispute without resorting to litigation.

Letter of Demand

The amount of commitment involved in a business acquisition is substantial, and it’s important to know what you’re getting yourself into in advance. Thorough due diligence is vital, but at the same time, it needs to be focused on information that’s relevant to the transaction. Anything beyond that is ultimately a waste that could prevent the transaction from ever closing.

Here, we’ll discuss the most important information to ask for prior to completing a business acquisition.

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