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Uncategorized

Are Non-Compete Clauses Legal Under the Biden Administration?

Are Non-Compete Clauses Legal Under the Biden Administration?

 

NON-COMPETE PROVISION UPDATE

 

As a result of an Executive Order released this year from the Biden Administration, The Federal Trade Commission (FTC) has been tasked with creating new rules curtailing the use of “clauses or agreements that may unfairly limit worker mobility.” Although non-compete provisions seem to be the focus, it is likely their review will include non-solicitation provisions, no-hire provisions, and non-servicing provisions used by employers. The rulemaking process generally moves slowly and requires several steps including a notice of proposed rulemaking, an opportunity for comment, and FTC’s responses prior to finalizing a rule. Peyton Law will be closely following this evolution, and we look forward to working with you to ensure your employment agreements are in compliance when final rules are published.

 

November 15, 2021/0 Comments/by Janelle Peyton
https://peytonlaw.com/wp-content/uploads/2021/11/Non-Compete-Peyton-law-806-x-306-px.png 306 806 Janelle Peyton https://peytonlaw.com/wp-content/uploads/2021/06/Peyton-Law-Main-Logo-1-1030x303.png Janelle Peyton2021-11-15 21:53:312021-11-15 21:55:40Are Non-Compete Clauses Legal Under the Biden Administration?
Testimonials, Uncategorized

LORI (& MIKE) DEMARTINIS

“I am very happy with Janelle and how her professionalism with my company (Elite Audio) was handled.”

November 23, 2020/0 Comments/by spowell
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Uncategorized

Top 9 Reasons to Use a Loan Processor Instead of a Bank

Did you know that in good times, up to 50% of loans are declined due to improper loan packaging?

Snyder Law recently partnered with 11 Capital Finance to support businesses with their SBA funding needs. As you can probably guess, we do not want to see any of our clients or their companies struggle due to the current situation, so Snyder Law recently partnered with 11 Capital Finance to support businesses with their SBA funding needs.

We partnered with 11 Capital Finance because they are a loan packaging company and their values are the same as ours at Snyder Law. Their job is to hold the company’s “hand;” to make sure the application is complete the first time and to ensure their clients are at the front of the line to receive their emergency relief funding.

So, I invite you to start the application process by filling out our intake form here: www.snyderbusinesslaw.com/sba-loan.

Top 9 Reasons to Use Our Team Instead of a Bank:

1.     Experience with SBA funding. 11 Capital Finance is a privately held company which has been working hand in hand with the SBA for over 25 years.

2.     Trusted Partner. Snyder Law is your trusted legal partner, and we will do our best to guide you in the right direction and make sure you are confident in your decisions.

3.     Access to the Lenders. 11 Capital Finance has been working with private lenders for over 25 years. They can access their knowledge and lending requirements with a phone call. Our access to the underwriters translates into quick answers for your individualized requests.

4.     Packaging Experts. Unfortunately, most of the businesses that apply will not qualify due to improper packaging. In the best of times, 50% of all loans are declined due to improper loan packaging. Additionally, many of the SBA programs are complicated loan files to compile. With 25 years of experience, 11 Capital Finance will make sure it’s done right.

5.     Expedited Funding. Using a trained loan expert who is working directly everyday with the SBA and private lenders will expedite loan funding from possibly waiting months to only days.

6.     Navigating the Process. Applications on the Federal website are incomplete for actual SBA approvals. By the time an SBA lender contacts you requesting the complete package, there will be tens of thousands of applicants in front of your request. The complete application requires a list of additional documents. The SBA is not providing customer service or other resources to help businesses with their application or documentations. And unfortunately, the longer it takes a business to complete the application, the further down the line you fall in receiving the funding you need.

7.     Resubmission. Mistakes happened and details are sometimes missed (we’re human, too), but with direct access to the lenders, we can correct these mishaps as soon as they are recognized. So, instead of your application being rejected or moved to the bottom of a pile, it’s directed back to us for resubmission.

8.     Support Local. 11 Capital Finance is located in Greater Philadelphia, with its headquarters in Lansdale, Pennsylvania. Snyder Law serves privately held businesses and family owned companies throughout the region and is located in Radnor, Pennsylvania.

9.     No additional fee. There are no upfront fees and the SBA has waived all application fees. There will be a standard 2% origination fee when funds are dispersed that come out of loan proceeds, which is the same no matter which lender funds your loan. Working with Snyder Law and 11 Capital Finance is a free bonus, and a financially sound decision.

Snyder Law has recommended that their clients apply to the SBA (7a) Loan (the Paycheck Protection Program or PPP) for the maximum amount available as the loan is forgivable, so long as it is used for payroll expenses (and a few other business-related expenses). There’s no reason not to get started: so, we invite you to begin the application process by filling out our intake form here: www.snyderbusinesslaw.com/sba-loan.

 

Next Steps

If you need help, you can schedule a complimentary call here: https://calendly.com/jpeyton/sba-loan.

If you would like to learn more about any of the topics mentioned here, please call or text 484-801-0021 or reach out to Cassandra Ortner at cassandra.ortner@peytonlaw.com. We proudly support the nation’s business owners.

*Janelle Peyton is the CEO and Managing Partner of Peyton Law, a leading boutique law firm designed to provide the highest quality branding, business, and legal services to companies via quarterly subscription called Strategic Legal Solution. Peyton Law offers brand building strategies through corporate and intellectual property law, including business entity formation, buy+sell, contracts, joint ventures, trademarks, patents, licensing, and other growth-related transactions.

 

April 4, 2020/0 Comments/by apowell
https://peytonlaw.com/wp-content/uploads/2020/06/jeshoots-com-fzOITuS1DIQ-unsplash-scaled-1.jpg 1707 2560 apowell https://peytonlaw.com/wp-content/uploads/2021/06/Peyton-Law-Main-Logo-1-1030x303.png apowell2020-04-04 17:25:422021-06-14 17:10:08Top 9 Reasons to Use a Loan Processor Instead of a Bank
Uncategorized

It’s time to apply for the SBA (7a) Loan (Payroll Protection Program/PPP)

[SPECIAL UPDATE” To submit an application today, for processing ASAP, please visit my website here: https://peytonlaw.com/sba-loan/. I am working closely with 11 Capital to prepare loan application packages for immediate approval. ]

The Small Business Administration (SBA) SBA is currently responsible for two relief loans, the SBA (7a) Payroll Protection Program (or “PPP”), and the Economic Injury Disaster Loans (EIDL). The EIDL loans are funded through FEMA, and as such they mimic the level of effort and timeline of their personal disaster recovery loans. There are not forgivable and are not funded through banks and lenders. [For more information on EIDL Loans, visit here: https://covid19relief.sba.gov/#/ ]. I am recommending that all my clients apply for both loans.

The PPP loan is funded by SBA-approved banks and lenders, and insured by the SBA. The PPP loan’s goal is to keep people employed by giving forgivable loans to employers. This program will be followed by other (not yet clarified) SBA programs to loan larger amounts of money for debt relief, operating expenses, and real estate.

Applications for funding through the PPP loan will be accepted by banks and lenders as soon as Friday, April 3, 2020. Only applications from businesses are accepted now; applications from sole proprietors and independent contractors will be accepted beginning next Friday, April 10, 2020. Businesses may borrow the monthly average of their payroll costs (including employer-paid taxes, group health insurance, retirement funding paid by the employer, and 1099 contractors who contribute as would a W-2) times 2.5.

The loan is at 4% with a 10 year term, the first 6-12 months of payments will be deferred. If the funds are used for payroll, they will be forgiven. There are more specifics on the forgiveness which will be outlined later.

To begin the process, please visit my website here: https://peytonlaw.com/sba-loan/to complete the intake form. I am working closely with 11 Capital to prepare loan application packages for immediate approval. [Please share this link with any business owners you know.]

We will then get you a checklist regarding documentation needed to apply for the PPP, and you will be assigned a loan processing agent.

If you need help, you can schedule a complimentary call here: https://calendly.com/jpeyton/sba-loan.

Janelle Snyder Peyton is the CEO and Managing Partner of Snyder Law, an award-winning boutique law firm providing the highest quality general counsel and intellectual property legal services to companies at predictable and reasonable rates via a service called Scribe®. The firm offers brand building strategies through corporate and intellectual property law, including business entity formation, contract drafting and review, joint venture agreements, trademark and copyright protection, and licensing & franchising.

April 3, 2020/0 Comments/by apowell
https://peytonlaw.com/wp-content/uploads/2020/06/APPLY-NOW.png 788 940 apowell https://peytonlaw.com/wp-content/uploads/2021/06/Peyton-Law-Main-Logo-1-1030x303.png apowell2020-04-03 17:57:142020-06-15 18:07:19It’s time to apply for the SBA (7a) Loan (Payroll Protection Program/PPP)
Uncategorized

Contracting & Coronavirus

This 3-part series provides the basics on evaluating force majeure clauses likely found in the agreements and contracts used by privately held and family-owned small and medium sized companies.

Part 1 describes the steps to determine whether your agreements contain applicable force majeure language; Part 2 takes a deeper look into the definition of the terms in typical force majeure clauses and whether the coronavirus allows nonperformance; and Part 3 guides you through the decision process on whether invoking a force majeure clause is best for your situation.

Force Majeure Distinctions that Companies Need to Know

[Part 2 of 3 in the series “Contracting & Coronavirus”]

We are over a week into social distancing due to the coronavirus (aka COVID-19), and students are schooling from home, the grocery store shelves remain relatively empty, and non-essential physical business locations are closed. It is difficult to find a company that is not feeling the effects of the pandemic. As we come together as a country to make it through these challenging times, our business owners, presidents and CEOs must carefully navigate their company through available options. Some of these decisions will affect their agreements with other struggling companies, which is why it is vitally important to thoroughly understand and comprehend the nuances among force majeure clauses in typical agreements.

This article will help the Owner, CEO, President, and General Counsel to identify nuances in force majeure language. Here are the most important distinctions found in typical force majeure language:

Distinction #1 Timeliness of the Agreement.

For an event to be considered an “Act of God,” and especially for the party invoking force majeure, the event must have been unforeseeable. In the legal world, “unforeseeable” means that an ordinary person could not have reasonably anticipated or expected the circumstances (see https://dictionary.findlaw.com/definition/unforeseeable.html).

Would an ordinary person expect a pandemic? Pandemics have occurred in known history, so isn’t it reasonable that another pandemic might occur? We are all aware that floods, fires, hurricanes, pandemics, strikes, etc. can occur; the issue of timeliness goes to whether we knew it might occur in relation to the contract as we agree to the terms.

On December 31, 2020 Chinese authorities alerted the World Health Organization of the apparent coronavirus epidemic. As of this date, it can be argued that the current pandemic was reasonably foreseeable. Was your agreement signed after this date? Did you or the other party have knowledge of the news reports starting to come out of China? How was anyone supposed to know that this was going to become the major event that it is?

Of course, the facts underlying each situation are always relevant, so it is best to have your general counsel or business attorney review them in relation to the force majeure provision to wording to determine its reach.

Distinction #2 What Legal Standard is Set Forth in the Force Majeure Clause? 

In Part 1, we briefly discussed that causation between the coronavirus and a party’s inability to perform its contractual obligations is required to invoke force majeure. However, the legal standard used to define the causation in force majeure provisioning is also be a critical factor. The force majeure clause may require that performance be “impossible,” or it could invoke a lesser standard such as requiring performance simply be “impeded,” “impracticable,” or “hindered.” Thus, depending on the specific language used in the force majeure clause, a party may not be able to invoke force majeure simply because the ability to perform has become more difficult or expensive. For example, if the party can still fulfil its obligations in an alternate manner or by paying additional sums (such as by obtaining materials or labor from another source, or increasing overtime work for employees), it may not be allowed the release of its obligations. In the alternative, if the relevant standard is less strict, then the party may be able to find relief as the cost or difficulty to perform its part of the agreement increases.

Distinction #3 Variations on Force Majeure Clauses. 

Although force majeure language can appear in a myriad of combinations, it is helpful to compare commonly used clauses. Six (6) partial examples are listed herein; exemplifying defintions of force majeure events, different legal standards, and alternative mitigation requirements.

Obligations Excused if No Reasonable Control: If either Party can provide evidence to the satisfaction of the other that its performance of any of its obligations under this Agreement is prevented by reason of any event or combination of events beyond its reasonable control, it shall be entitled to relief…

Notice Only Required: Upon occurrence of a Force Majeure Event, the non-performing party shall promptly notify the other party that a Force Majeure Event has occurred, its anticipated effect on performance, including its expected duration.

Simple: No party will be liable for nonperformance of any of its obligations under the agreement if its nonperformance was due to a Force Majeure Event as defined below…

Minimizing Damages: Neither Party shall be entitled to claim relief in respect of any period during which it could have complied with any obligation by using its best endeavors to avoid, overcome or minimize wholly or partly the effects of the said event or combination of events….The non-performing party shall use reasonable diligence to minimize damages and to resume performance.

With Definition: No party will be liable for nonperformance of any of its obligations under the agreement if its nonperformance was due to a Force Majeure Event. A Force Majeure Event shall mean any act of God, such as but not limited to; war; riot; civil strife; act of terrorism, domestic  or foreign; embargo; governmental rule, regulation or decree; flood, fire, hurricane, tornado, or other casualty;  earthquake;  strike, lockout, or other labor disturbance; the unavailability of labor or materials to the extent beyond the control of the party affected; or any other events or circumstances not within the reasonable control of the party affected, whether similar or dissimilar to any of the foregoing.

Except for Payment: Neither Party shall liable hereunder for any failure or delay in the performance of its obligations under this Agreement, except for the payment of money, if such failure or delay is on account of causes beyond its control, including labor disputes, civil commotion, war, fires, floods, inclement weather, governmental regulations or controls, casualty, government authority, strikes, or acts of God, in which event the non-performing party shall be excused from its obligations for the period of the delay and for a reasonable time thereafter.

Compare the above examples with the force majeure wording in your agreement, and bring any nuances to the attention of your CEO and general counsel before making a decision on whether invoking a force majeure clause is in your best interest.

This is Part 2 of a 3-Part Series. Part 1, describing the steps to determine whether your agreements contain applicable force majeure language, is available here: Part 1: The 4 Steps to Force Majeure. Part 3 looks closely at the decision making process as a company decides whether to invoke a force majeure clause. If you need assistance determining whether to invoke a force majeure clause, please call or text 484-801-0021 or reach out to Cassandra Ortner at cassandra.ortner@peytonlaw.com. We proudly support the nation’s business owners.

*Janelle Peyton is the CEO and Managing Partner of Peyton Law, a leading boutique law firm designed to provide the highest quality branding, business, and legal services to companies via quarterly subscription called Strategic Legal Solution. Peyton Law offers brand building strategies through corporate and intellectual property law, including business entity formation, buy+sell, contracts, joint ventures, trademarks, patents, licensing, and other growth-related transactions.

 

March 24, 2020/0 Comments/by apowell
https://peytonlaw.com/wp-content/uploads/2020/06/2020.03.16-Coronavirus.001-1.jpeg 634 1916 apowell https://peytonlaw.com/wp-content/uploads/2021/06/Peyton-Law-Main-Logo-1-1030x303.png apowell2020-03-24 18:07:282021-06-14 17:13:00Contracting & Coronavirus
Uncategorized

Contracting & Coronavirus

This 3-part series provides the basics on evaluating force majeure clauses likely found in the agreements and contracts used by privately held and family-owned small and medium sized companies.

Part 1 describes the steps to determine whether your agreements contain applicable force majeure language; Part 2 takes a deeper look into the definition of the terms in typical force majeure clauses and whether the coronavirus allows nonperformance; and Part 3 guides you through the decision process on whether invoking a force majeure clause is best for your situation.

4 Steps to Force Majeure

[Part 1 of 3 in the series “Contracting & Coronavirus”]

Is the novel coronavirus (the disease known as COVID-19) effecting your business? After less than a week of school closures, cancellation of spring sporting events, and empty grocery store shelves, it is apparent that the outbreak of the coronavirus is impacting commerce. For the foreseeable future, companies will be faced with decisions regarding supply chain disruptions, changes within the labor force, and how best to protect employees from contracting the virus. The ability to invoke a force majeure clause in a contract based on the coronavirus may become a vital part of a company’s ability to survive the current economic conditions.

This article is designed to assist the CEO, President, and General Counsel in determining whether the company’s contracts contain applicable force majeure language. Here are the steps to take in determining whether the coronavirus might constitute a force majeure event in your company’s agreements:

STEP 1. Check Your Agreement for a Force Majeure Clause. 

Take a few moments to review your agreements to determine if they include a force majeure clause or similar provision. A force majeure clause generally states that a party may be excused from some or all of its obligations if certain events or circumstances beyond a party’s reasonable control have occurred. Most clauses list a series of examples of types of incidents or circumstances deemed to be force majeure events. Additionally, some provisions will excuse performance for the duration of that force majeure event and some will continue to excuse the performance for a reasonable period thereafter.

If the contract does not contain a force majeure clause, relief may still be granted on other grounds, such as supervening events or failure of a condition. Of course, it is always best to have your general counsel or business attorney review the exact wording of your contract to determine its reach.

STEP 2. Does it Include the Coronavirus?

You found that your agreement includes a force majeure clause or similar wording; now what? The next step is to determine whether the coronavirus is included in the definition of force majeure event. Examine the specific language in the force majeure provisions to determine whether the clause includes a pandemic, epidemic, public health emergency, outbreak of communicable disease, or another similar occurrence as a force majeure event.

If your provision does not use the aforementioned language, consider whether another term might logically include the coronavirus outbreak. General force majeure language often reads, for example, “any act of God, such as but not limited to; war; riot; civil strife; act of terrorism, domestic or foreign; embargo; governmental rule, regulation or decree; flood, fire, hurricane, tornado, or other casualty;  earthquake;  strike, lockout, or other labor disturbance; the unavailability of labor or materials…”, etc.)” The aforementioned events in italics may fall with the scope of the force majeure provision eventhough they occur as a result of the coronavirus pandemic.

STEP 3. What is the Reason for Nonperformance? Is it truly the Coronavirus?

Causation is a legal theory that explains the relationship between a party’s conduct and the resulting effect. Before deciding that the force majeure provision will apply to the coronavirus situation, check whether causation can be established between the coronavirus and the effect or injury. The party seeking relief from the contract must not be able to perform because of the coronavirus. For example, if a widget manufacturer cannot manufacture widgets because all widget ingredients are also used to make hand sanitizer, and the government demands that all ingredients must go to the production of hand sanitizer and not widgets, then the widget manufacturer cannot legally manufacture widgets. On the other hand, if the widget manufacturer could not have manufactured the widgets anyway because their machine was broken; then causation cannot be established and force majeure cannot be evoked. Each company’s situation will be different, and any determination must be sensitive to the particular facts.

STEP 4. Exceptions or Exclusions.

Unfortunately, your agreement may contain exceptions or exclusions to its force majeure provisions. A further review of the language of your agreement could unearth exceptions or exclusions around payment terms and obligations, or regarding whether certain events may have been foreseen or prepared-for. Some of this language may negate the entire effect of the force majeure provisions at worst; or at best, it may limit the nonperforming party’s recourse.

A very common exception or carve-out is around a party’s obligation to pay timely for goods and services received. In these cases, no matter the severity of the force majeure event, payment will be due in full and on time. Your General Counsel can help you determine if your provisions are precluded by an exception.

Part 2 of this series will take a deeper look into typical force majeure clauses and whether the coronavirus allows nonperformance. The timeliness of the agreement and the standard set forth in the force majeure provision will be considered. If you need assistance determining whether to invoke a force majeure clause, please reach out to us at hello@snyderbusinesslaw.com or call or text us to schedule a free consultation at 484-801-0021.

Janelle Snyder Peyton is the CEO and Managing Partner of Snyder Law, an award-winning boutique law firm providing the highest quality general counsel and intellectual property legal services to companies at predictable and reasonable rates via a service called Scribe®. The firm offers brand building strategies through corporate and intellectual property law, including business entity formation, contract drafting and review, joint venture agreements, trademark and copyright protection, and licensing & franchising.

March 16, 2020/0 Comments/by apowell
https://peytonlaw.com/wp-content/uploads/2020/06/Untitled.001.jpeg 634 1913 apowell https://peytonlaw.com/wp-content/uploads/2021/06/Peyton-Law-Main-Logo-1-1030x303.png apowell2020-03-16 18:08:592020-06-15 18:09:59Contracting & Coronavirus
Uncategorized

Merry Christmas Meme

December 20, 2018/0 Comments/by apowell
https://peytonlaw.com/wp-content/uploads/2020/06/2018.12-SnyderLAW-Christmas-Meme.001-e1545316991734.jpeg 525 700 apowell https://peytonlaw.com/wp-content/uploads/2021/06/Peyton-Law-Main-Logo-1-1030x303.png apowell2018-12-20 18:10:152020-06-15 18:11:19Merry Christmas Meme
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No Strings Attached? 4 New Tax Limitations that Businesses Owner Should Know

4 New Tax Limitations Effecting Businesses in 2018

What is business without some changes and some challenges? The first quarter of 2018 has business owners questioning the new tax law and its effects on business.

The main changes in tax and business can be grouped into two types of legal entities: the corporations and the pass-through entities.

Corporations generally include C-Corporations (Corp. or Inc.), Professional Corporations (P.C.), and Limited Liability Companies (LLC) choosing to be taxed as Corporations. For these entities, the tax reform is quite clear: starting in 2018, profits will be taxed at a flat rate of 21%. Pre-reform, they were taxed at 35%, so most corporations will see a drastic decline in their next tax bill. The hope of the tax law’s proponents is that they will use this extra income to spur domestic growth and attract better talent. Recent news seems to indicate that corporations are already re-investing their savings.

For as straightforward as the tax reform is for corporations, it is seemingly more complex for the generally smaller pass-through entities. These include sole proprietorships, partnerships, Limited Liability Companies (LLC) electing to be taxed as a partnership, Single-Member LLCs, and S-Corporations. These pass-through entities are offered up to a 20% deduction on their business income via Section 199A; however, there are some strings attached.

String #1: Threshold Amounts

The threshold amount is a pre-determined amount of income under which, the full 20% deduction is achieved. Any taxpayer having income over the threshold amount is subject to the other “strings” listed below. The threshold amount for an individual taxpayer is $157,500 and $315,000 for married taxpayers filing jointly.

String #2: Specified Service Trade or Business

Specified service trade or businesses include: service businesses in the fields of health, law, consulting, athletics, financial services, brokerage services, and “any trade or business where the principal asset is the reputation or skill of one or more of its employees or owners,” except for engineering and architecture.

If a business falls into this category, and the taxpayer(s) income exceeds a “phase-in” amount, then no deduction is achieved. The phase-in amounts are $207,500 for individual taxpayers and $415,000 for married taxpayers filing jointly.

String #3: Wage and Capital Limit

The wage and capital limit comes into play when a taxpayer is over the threshold amount, and it provides a formula that erodes the taxpayers’ deduction to less than the full 20%.

String #4: Phase-In

Phase-in begins when a taxpayer(s) income is over the threshold amount. The 20% deduction is reduced by a calculated applicable percentage rate. The resulting rate is applied against the tentative 20% deduction to achieve the final deduction amount.

Even given the above mentioned “strings,” most pass-through entities will continue to find savings with the new tax law. However, where an LLC filing as an S-Corp may have once provided the best tax advantages for a particular company, with the new tax laws, a C-corporation may better serve their needs; or vica versa. With tax reform comes entity restructuring.

Make sure that your business continues to be in the smartest entity for its industry and income level; contact your tax advisor or CPA and your business attorney for advice specific to your situation. In partnership with Phoenix Tax Consultants, we are offering ½ day comprehensive tax and entity structure consultations. To schedule, send a quick email to hello@snyderbusinesslaw.com.

Next Steps

If you would like to learn more about any of the topics mentioned here, please call or text 484-801-0021 or reach out to Cassandra Ortner at cassandra.ortner@peytonlaw.com. We proudly support the nation’s business owners.

*Janelle Peyton is the CEO and Managing Partner of Peyton Law, a leading boutique law firm designed to provide the highest quality branding, business, and legal services to companies via quarterly subscription called Strategic Legal Solution. Peyton Law offers brand building strategies through corporate and intellectual property law, including business entity formation, buy+sell, contracts, joint ventures, trademarks, patents, licensing, and other growth-related transactions.

 

February 5, 2018/0 Comments/by apowell
https://peytonlaw.com/wp-content/uploads/2020/06/SnyderLAW-Strings-Attached-Tax-Changes-scaled.jpg 977 2560 apowell https://peytonlaw.com/wp-content/uploads/2021/06/Peyton-Law-Main-Logo-1-1030x303.png apowell2018-02-05 18:11:362021-06-14 17:15:52No Strings Attached? 4 New Tax Limitations that Businesses Owner Should Know
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Is Santa Claus Infringing on Trademark Rights?

Santa Clause, Saint Nick, and Father Christmas are references made over and over again this time of the year. A quick search of the United States Patent and Trademark Office (USPTO) database reveals that there are 2,185 trademarks containing the word “Christmas,” and 3,401 which include the name “Santa.” Other trademarks used the terms “candy cane,” “north pole,” and “Kringle.” However, not one of these marks appears to be registered by Santa himself.

Registered trademarks are highly protected, so how is it that Santa can go around using “The North Pole,” “Father Christmas,” and his own name, “Santa Claus” without local and national businesses coming after him for infringement of their trademarks? (Perhaps he gives them extra special presents under the tree on Christmas morning?)

Although there are many things that make the United States a remarkable country for starting and growing a business, one very special right has to do with our trademark common law. “Common law” refers to the rights and rules that are created via the countless decisions made by our judicial system over time. Common law has nothing to do with actual laws, statues, or formal regulations. It is based on the facts and logic used to decide particular arguments and disagreements between the two or more parties to a case. Cumulatively, these decisions form the precedent that becomes our “common law.”

The United States has a strong statue on trademarks (called the Lanham Act) and an entire government organization (the USPTO) dedicated to registering marks and logos; as do other countries that Santa must travel through on Christmas Eve. Unlike most other countries, who have a “first-to-file” system of trademark law, the United States recognizes an ownership right at the first use of the mark. This right attaches immediately when the mark is used in commerce. It is limited to the geographic area of use of the mark, but it endures so long as there is continual and deliberate use of the mark. Continual and deliberate use is reinforced by adding the superscript “TM” following the word, phase, image, tagline, or jingle.

The magical thing about common law trademark rights is that they stop competing businesses within the local area from using identical or similar marks. If a nearby business uses another’s mark for a similar type of goods and services, the first company that used the mark can force the infringing company to change their name, and can usually recover damages as well. Therefore, a common law trademark can suppress a later use of a similar trademark.

A common law trademark can also overpower a registered trademark when the common law rights pre-date the registration date of the registered trademark. However, there are some considerable limitations to common law trademark rights verses those registered with the USPTO.

  • First, a registered U.S. trademark protects the mark across the entire country, not just within the geographic area of use of the mark.
  • Second, a registered trademark is listed in the USPTO database. This makes it easy for potentially competing businesses to discover the mark, and decide not to use it. It essentially places other companies on notice that someone has claimed a right to that particular mark.
  • Third, a registered trademark qualifies to use the ® symbol, rather than the ™ symbol used for common law trademarks.
  • Last, and most importantly, a registered trademark allows the owner to file an infringement suit in federal court. The owner has the right to not only recover lost profits, recoup legal fees, and sue for statutory damages; they also have the right to collect triple (3x) damages if the infringement was willful.

My Google research indicates that Santa is 1,747 years old, and goes by over 20 different names, including Santa Clause, Saint Nicholas, Saint Nick, Kris Kringle, and Father Christmas. The Lanham Act was passed in 1946, and its predecessor legislation was passed in 1881. However, our country has protected trademarks under common law since colonial times. Because Santa has been delivering his gifts under his various names and has been utilizing other common terms of the holidays for over 1,700 years, this means that, as per United States trademark common law, Santa is the rightful owner of his tradenames for the delivery of gifts and toys to good boys and girls. And, because he delivers throughout the county, his trademarks enjoy protection throughout the nation.

Santa has nothing to fear when it comes to defending ownership of his tradenames. However, if your company or business is uncomfortable depending on common law rights, and wants to understand available options, please visit us at here to schedule a review of your trademarks or please call or text 484-801-0021 or reach out to Cassandra Ortner at cassandra.ortner@peytonlaw.com. We proudly support the nation’s business owners.

*Janelle Peyton is the CEO and Managing Partner of Peyton Law, a leading boutique law firm designed to provide the highest quality branding, business, and legal services to companies via quarterly subscription called Strategic Legal Solution. Peyton Law offers brand building strategies through corporate and intellectual property law, including business entity formation, buy+sell, contracts, joint ventures, trademarks, patents, licensing, and other growth-related transactions.

 

December 1, 2017/0 Comments/by apowell
https://peytonlaw.com/wp-content/uploads/2020/06/dreamstime_xxl_104423574-1-scaled.jpg 1099 2560 apowell https://peytonlaw.com/wp-content/uploads/2021/06/Peyton-Law-Main-Logo-1-1030x303.png apowell2017-12-01 18:56:142021-06-14 17:20:41Is Santa Claus Infringing on Trademark Rights?
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Is Amazon the New Government? Amazon’s Brand Registry 2.0

Drones, Alexa, and exponential growth are a few things that come to mind when Amazon is the topic of discussion. The company had humble beginnings as a bookstore, but no one would call it a mere book store these days. Of course you can still buy a book on Amazon, you can stream music and movies, and you can purchase your favorite brand – be it shoes, clothes, jewelry… the list is nearly endless. But not for long.

In a world full of brand copycats and knock-offs, Amazon has released what we’re calling Brand Registry 2.0 to fight these counterfeiters. In the past, companies selling on Amazon had only to provide a website with images of their products and packaging bearing the brand names. The latest revision of the Brand Registry rules state that a federal trademark registration is now a requirement.

Federal trademark registrations are issued from the United States Patent and Trademark Office, or USPTO. On average, achieving registration takes approximately 6 months, but can take years if the USPTO Examiner assigned to review the application finds a similar trademark.

Protecting your brand name with a trademark registration is always a smart idea, and the new Brand Registry is in alignment. According to Amazon, even previously listed sellers will need to re-enroll in the new Brand Registry to gain access to the latest features; which means they will also be required to show proof of their federal trademark registration.

Not sure whether Amazon’s Brand Registry 2.0 is worth it? Let’s explore the benefits and eligibility requirements.

Benefits – Why join the Brand Registry?

  1. Brand Protection. Amazon’s Brand Registry is designed to verify you (and only you) as the authorized seller of your brand. Since Amazon recognizes you as the true brand owner, the process for removing counterfeit products is expedited. This means more cha-ching in your pocket, and none for the copycats and counterfeits.
  2. Brand Control. With registration, brand owners are granted more control over product titles, details and images. You can more easily “brand” your brand. This enhances your consumers’ immersion into your branding, thus resulting in increased brand awareness.
  3. Brand Exclusivity. Only 3 distinct categories of sellers can apply for Brand Registry. They are (i) manufacturers and producers who sell their own branded products, (ii) private label brand owners, and (iii) distributors and resellers with express permission from the brand owner. Sellers without a federal trademark registration or an express authorization from a brand owner will be excluded, and will be left unprotected.
  4. Enhanced Logistics. As a brand owner, you will receive Amazon-issued product IDs instead of having to use UPCs and EANs. This will ultimately lower expenses and reduce matching errors during listing. Again, more cha-ching.

Application Requirements for Amazon’s Brand Registry – The Short List:

  1. Product & Packaging Images. Images of your product(s) and packaging with branding visibly printed/displayed. Quick Tip: when entering your brand name, be sure to enter it exactly as it appears on your products and packaging.
  2. Website Link. A link to your brand’s website containing images of the products and brand name.
  3. Proof of Trademark. You will need to submit the 7 digit U.S. Trademark Registration for the brand name. Unfortunately, pending trademark applications are not accepted.
  4. A Key Attribute/Unique Identifier (such as Manufacturer Part Number, Model Number, Catalog Number, or Style Number). Quick Tip: choose this wisely as it is an arduous process to change your unique identifier in the future.
  5. If you are a distributor or reseller, you will need to submit formal authorization from the trademark owner, usually provided as an Authorization Letter, Co-Marketing Agreement, or License Agreement. Quick Tip: for protection, you should also formalize your business arrangement with the brand owner, using an Authorized Distributor Contract, or by including relevant language in your Co-Marketing Agreement.

Do you Need a Trademark for Your Brand?

Amazon is stepping up to help safeguard your brand, if you are willing to protect it. Becoming part of the new Brand Registry could be critical to the success of your business. Keep in mind that having a federal trademark registration helps you not just on Amazon, but in any U.S. consumer marketplace.

To help you reap the benefits of trademark registration and Brand Registry, SnyderLAW offers multiple flat fee trademark packages to best suit your needs. Mention this article when you call (484-801-0021) or email (hello@snyderbusinesslaw.com),

If you would like to learn more about any of the topics mentioned here, please call or text 484-801-0021 or reach out to Cassandra Ortner at cassandra.ortner@peytonlaw.com. We proudly support the nation’s business owners.

*Janelle Peyton is the CEO and Managing Partner of Peyton Law, a leading boutique law firm designed to provide the highest quality branding, business, and legal services to companies via quarterly subscription called Strategic Legal Solution. Peyton Law offers brand building strategies through corporate and intellectual property law, including business entity formation, buy+sell, contracts, joint ventures, trademarks, patents, licensing, and other growth-related transactions.

 

and you will receive $100.00 off the package of your choice.

August 14, 2017/0 Comments/by apowell
https://peytonlaw.com/wp-content/uploads/2020/06/amazon.jpg 323 970 apowell https://peytonlaw.com/wp-content/uploads/2021/06/Peyton-Law-Main-Logo-1-1030x303.png apowell2017-08-14 19:05:062021-06-14 17:23:04Is Amazon the New Government? Amazon’s Brand Registry 2.0
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