Entrepreneurship is an exciting journey that’s full of risks. Whereas there are fantastic perks that come with being your own boss, there are also some legal challenges that you may face. If you’re a newbie in entrepreneurship, you must know the intersection between entrepreneurship and lawsuits to better arm yourself. Having built multiple businesses, Samier Chavez is well-versed about the common lawsuits entrepreneurs may face. Read on to learn more.
Entrepreneurship & Lawsuits: What you need to know
Founders are the fuel behind innovation and economic growth. Their efforts help create jobs, develop new markets, products, and services, and drive innovation. Since they are unafraid to innovate, they are game-changers to the market. A new report reveals that entrepreneurs account for 44% of the U.S. economy.
Yet a little-known fact is the legal hurdles that entrepreneurs face. Unaware of these challenges, an upcoming entrepreneur may grapple with legal pitfalls such as intellectual property rights, tax laws, employee rights, contractual disagreements, or industry-specific regulations.
Intellectual Property Disputes
Intellectual property is the most crucial asset for a business. It gives you an edge over your competitors and helps you build resilience. As such, you need to understand how to protect your intellectual property from disputes that may arise from former employees or competitors.
Intellectual property covers patents, trademarks, copyrights, and trade secrets. Protecting your intellectual property is the first thing you should do as you start your business, as it protects you from other people who would want to use your things, e.g., logos, symbols, names, etc.
Protecting your intellectual property is a time-consuming process. Therefore, working with a legal advisor is advisable.
Contractual Disagreements
Contractual disagreements hinder a firm’s progress in the market. Investor-entrepreneur conflicts are prevalent and can result in legal disputes that affect a company’s life span and success.
Samier points out that for your business to thrive, you must be efficient in contract agreements. Again, this is an area where you need legal advice to make an informed decision.
Regulatory Compliance Challenges
A common concern for startups is compliance with legal regulations. Failure to follow these regulations can result in fines and legal repercussions. So, how do you ensure compliance with regulators? You can hire a compliance officer or join industry associations and keep yourself updated.
Employment-Related Disputes
If you’re going to have employees, then you need to know how to navigate employment laws. Claims of discrimination, wrong termination, creation of intellectual property by employees, or to discipline employees are issues that can lead to a legal battle.
Federal and state laws impact the hiring process, giving various legal protections to employees. For instance, State and Federal laws forbid an employer from asking an employee about their age, religion, or if they have any medical conditions. When drafting the offer letter, you should learn what to put on the letter to avoid legal disputes.
Navigating Legal Challenges
Samier states that when setting up a business, your priority is to build a solid legal foundation from the beginning. This means setting corporate structures, well-drafted contracts, and compliance with relevant laws.
Seeking legal advice should be one of your top priorities. Building a relationship with a business attorney helps you avoid legal pitfalls and sets you up for success. Lastly, it would help if you implemented preventive measures like regular legal audits and compliance checks to protect your business from any potential legal issues.
