Articles Posted in Corporations

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AdobeStock_558703638-300x169When it comes to forming a new startup, a California limited liability company (LLC) offers a number of advantages. As the name suggests, an LLC protects the personal assets of individual members from business creditors. And since the LLC is a “pass through” entity, any profits are taxed on the returns of individual members.

But while this arrangement may be ideal for founder-run startups with just a few equity holders, once the business seeks financing from venture capital or other investors, it is often necessary to convert to a corporation. More precisely, a California LLC may need to convert to a Delaware Corporation. The California corporations attorneys at Structure Law Group can advise you on the benefits and drawbacks of making this move. Contact us today to schedule an initial consultation.

When Is a Conversion Necessary?

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AdobeStock_750357071-300x200The rapid evolution of artificial intelligence (AI) is reshaping the world through new trends, regulations, and shifts in user behavior. While AI offers numerous benefits, it also introduces significant risks, particularly concerning accuracy, accountability, data privacy, and security. By proactively implementing mitigation strategies, businesses can harness AI’s potential while protecting their operations and reputation. Below, we explore key considerations for deploying AI across business processes while minimizing legal and regulatory risks.

AI Accuracy and Accountability

A major obstacle to fully realizing AI’s capabilities is concerns about its accuracy and accountability. The core of this issue lies in the quality and quantity of the data used to train AI models. The accuracy of AI models directly reflects the data sets they are trained on. If these data sets are biased or inaccurate, the resulting algorithms can perpetuate hidden discrimination against certain groups. This lack of transparency raises questions about the reliability of the output data, which can be misleading, biased, or incorrect.

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AdobeStock_533470666-300x200Chapter 134A of the Texas Civil Practices and Remedies Code is known as the Texas Uniform Trade Secrets Act, and Texas Civil Practices and Remedies Code § 134A.002(6) establishes that a trade secret is defined as “all forms and types of information, including business, technical, scientific, economic, or engineering information as well as any design, formula, pattern, prototype, compilation, plan, program, code, program device, device, technique, method, process, procedure, financial data, or list of actual or potential customers or suppliers, whether it is tangible or intangible and whether or how compiled, stored, or memorialized physically, electronically, graphically, photographically, or in writing when an owner of a trade secret takes reasonable measures under the circumstances to keep the information secret, and the information derives actual or potential independent economic value from not being generally known to and not being readily ascertainable through proper means by another person who can obtain economic value from the disclosure or use of such information.” Trade secrets are valuable because there are considerable efforts to protect the information, and people will need to work with a Texas business attorney for help protecting their trade secrets.

A legal cause of action for exposed trade secret information is known as misappropriation of trade secrets. This occurs if a trade secret is improperly acquired or is otherwise disclosed or used without consent.

Reasonable Measures to Maintain Trade Secrets

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AdobeStock_439234126-300x155The key to any successful Silicon Valley business is hiring the right people. Indeed, the decision to hire a new employee is an important task for any business, whether it is a startup or a multinational corporation. But what are the legal issues you need to consider before you decide to bring a new person into your company?

SLG offers counseling on a wide range of California employment law issues to businesses in San Jose and throughout Northern California. Here are just a few of the key issues you need to think about when it comes to new employees.

Employee or Contractor?

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AdobeStock_288950388-300x180Selecting a legal entity is often one of the first critical decisions you must make when starting a new business. But it is possible to change or convert one type of business entity into another if your needs or circumstances change. If you want to know more about the potential tax and legal implications of such a move, the Silicon Valley corporations attorneys at Structure Law Group are here to help.

The Advantages and Disadvantages of S Corporations in California

Let’s assume you currently have an S corporation, and you want to convert it to a sole proprietorship. What are the advantages or disadvantages of such a conversion? And how would you go about accomplishing it?

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AdobeStock_357298238-300x111Corporate Transparency Act (CTA)

The Corporate Transparency Act (“CTA”) was enacted by the U.S. Bureau Department of Treasury to address growing concerns about the use of shell companies and other opaque ownership structures to facilitate financial crimes like money laundering, tax evasion, and terrorist financing. By making beneficial ownership information more readily available, the law aims to deter and disrupt illegal activities. The CTA establishes a national beneficial ownership information registry accessible to law enforcement and authorized government agencies.

When and how should my company file its initial report?

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AdobeStock_561003317-300x169Many startups in the San Jose area look to Delaware when establishing their corporate structure. You have probably heard that many top companies are incorporated in Delaware. Delaware is a popular state to form a corporation.  But what are the advantages to a Silicon Valley company operating in Delaware?  And how can you create your own Delaware company? The San Jose corporations lawyers at Structure Law Group, LLP can help answer these and other questions about the startup process.

What Are the Advantages of Incorporating in Delaware?

Despite being one of the smallest states, Delaware plays a significant role in corporate formation and law, offering numerous advantages. The state’s appealing tax laws are a primary factor for companies choosing to incorporate there. Corporations not conducting business in Delaware are exempt from the state’s corporate income tax, even if incorporated there. Instead, they are subject to a ‘franchise tax,’ which is typically much lower than corporate taxes in other states. Furthermore, Delaware offers considerable privacy for incorporators, requiring only the registered agent’s name on filings. Additionally, the state allows a single individual to establish a corporation and hold multiple corporate roles simultaneously.

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AdobeStock_287591012-300x200Starting a new business venture is an exhilarating journey, but also involves significant financial risks. Seasoned entrepreneurs understand the importance of safeguarding their personal assets from undue exposure. If you’re an aspiring entrepreneur in the Bay Area embarking on your first startup, the experienced San Jose startup and financing lawyers at Structure Law Group can provide valuable guidance on developing a comprehensive asset protection strategy.

Although every situation is distinct, here are a few essential considerations to keep in mind when safeguarding your personal assets from potential business liabilities:

Create a Limited Liability Business Entity

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AdobeStock_531731015-300x200The Silicon Valley region hosts numerous startups that have sought counsel from Structure Law Group to support their business growth. As San Jose business attorneys situated in the heart of Silicon Valley, Structure Law Group, LLP actively aids our clients in maximizing the potential of their new ventures. Our attorneys adopt a life cycle approach, providing guidance on entry strategies, growth management, and exit mechanisms to ensure comprehensive support at every stage of their journey.

The Silicon Valley business lawyers at SLG offer you a full-range of legal services to startups.

While every business is different in terms of their needs and plans for growth, here are five general tips to keep in mind when building your own startup.

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For certain licensed professionals, a AdobeStock_249826261-300x200 (LLP) offers an alternative to general and limited partnerships and limited liability companies and can offer several advantages over those business entities. The California partnerships lawyers at Structure Law Group can help you decide if an LLP is the right choice for your own business.

Only Certain Professionals Need Apply

Unlike a general partnership (GP), limited partnership (LP) or even a limited liability company (LLC), not everyone can form a limited liability partnership (LLP). California law currently limits LLPs to individuals licensed in one of the following professions:

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