FACTS: Feddeman & Co offered a group of its employees the opportunity to buy out the main stockholder, creating an employee-owned corporation. During the negotiations, the buy-out began to seem unattainable to the employees, so these employees and directors of Feddeman met with a competitor (Langan Associates). The employees discussed the possibility of employment with Langan Associates, and used the threat of resignation as a leverage.
Feddeman then sued Langan and Feddeman's former employees for conspiring to ruin Feddeman's business, usurpation of Feddeman's business opportunities and breach of fiduciary duties.
In order to legally leave Feddeman the employees followed the advice of an attorney, who was also Langan's lawyer.
JURY RULING: An Alexandria Circuit Court jury awarded 3.3 million dollars to Feddeman.
COURT RULING: The judge set aside the 3.3 million dollar verdict in part because the "employee Defendants scrupulously adhered to the advise of counsel as to how to prepare to leave". The case has been appealed to the Supreme Court of Virginia.
SUPREME COURT RULING: The Virginia Supreme Court found that there was not basis to set aside the verdict because defendant employees and defendant directors did more than merely prepare to resign and advise others of a plan to leave. Credible evidence supported the jury determination that the conduct fell below the required standard of good faith and loyalty, and was sufficient to constituted a breach of fiduciary duty. The Court reinstated the 3.3 million dollar verdict.
ACTION ADVISE: When making an important business decision, hire a lawyer that does not have a conflict-of-interest. Conspiring against an employer with a competitor may be considered a breach of good faith and loyalty, as well as a breach of fiduciary duty.
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The above article is not meant to replace legal counsel. If you'd like to meet with one of our lawyers, please call 703-273-1400 or fill out our online Information Request form.
Showing posts with label attorney virginia. Show all posts
Showing posts with label attorney virginia. Show all posts
Monday, January 17, 2011
Wednesday, April 14, 2010
Avoid Personal Liability: Always Use Legal Name of Business
In Virginia, a business entity properly registered with the State Corporation Commission (“SCC”) is a legal entity, separate and independent of its owners. Accordingly, unless it is necessary to promote justice, a business owner cannot be held responsible for the obligations of his/her business.
Nevertheless, business owners can quickly lose this shield of protection if they fail to disclose to third parties with whom they do business that they are acting in the capacity of an agent for the business, and not in their individual capacity. If this agency relationship is not disclosed (i.e third parties do not know they are doing business with an entity as opposed to an individual), the business owner may be held personally responsible for the obligations of the entity.
The same situation applies for business entities that use tradenames. If the tradename is not properly registered with the SCC, and the actual legal name of the entity is not disclosed to third parties, the business owner can be held personally responsible for the obligations of the entity.
Accordingly, it is very important for a business owner to make sure that all business correspondence (including letters, e-mails, contracts, agreements, business cards, etc.) clearly states the full legal name of the business. The full legal name includes the acronym identifying the form of the business entity (i.e. “Inc.”, “LLC”, “PC”, “LP”, etc.). When signing for the business, owners should always designate their title next to their name (i.e. President, CEO, etc. ) or use the term “authorized agent”. If a tradename is being used by the business, then it must be properly registered with the SCC. If not, all business correspondence must clearly state the actual legal name of the business, and not just the tradename.
Gross & Romanck, P.C. is currently representing an individual business owner being sued by a vendor for a debt of his business. The business had placed a purchase order with the vendor for expensive industrial machinery. When the business failed to pay for the machinery in full, the vendor sued the owner in his personal capacity for the debt. The vendor is relying upon the fact that the purchase order does not disclose the legal name of the business to argue that the order was placed by the owner, and not his business.
The lawsuit could have been avoided if the purchase order clearly identified the full legal name of the business or if the tradename had been properly filed with the SCC.
Do not let this happen to you! Always make sure that the full legal name of your business entity is disclosed to the third parties with whom your entity does business; and make sure that you always sign as an agent of the business.
Nevertheless, business owners can quickly lose this shield of protection if they fail to disclose to third parties with whom they do business that they are acting in the capacity of an agent for the business, and not in their individual capacity. If this agency relationship is not disclosed (i.e third parties do not know they are doing business with an entity as opposed to an individual), the business owner may be held personally responsible for the obligations of the entity.
The same situation applies for business entities that use tradenames. If the tradename is not properly registered with the SCC, and the actual legal name of the entity is not disclosed to third parties, the business owner can be held personally responsible for the obligations of the entity.
Accordingly, it is very important for a business owner to make sure that all business correspondence (including letters, e-mails, contracts, agreements, business cards, etc.) clearly states the full legal name of the business. The full legal name includes the acronym identifying the form of the business entity (i.e. “Inc.”, “LLC”, “PC”, “LP”, etc.). When signing for the business, owners should always designate their title next to their name (i.e. President, CEO, etc. ) or use the term “authorized agent”. If a tradename is being used by the business, then it must be properly registered with the SCC. If not, all business correspondence must clearly state the actual legal name of the business, and not just the tradename.
Gross & Romanck, P.C. is currently representing an individual business owner being sued by a vendor for a debt of his business. The business had placed a purchase order with the vendor for expensive industrial machinery. When the business failed to pay for the machinery in full, the vendor sued the owner in his personal capacity for the debt. The vendor is relying upon the fact that the purchase order does not disclose the legal name of the business to argue that the order was placed by the owner, and not his business.
The lawsuit could have been avoided if the purchase order clearly identified the full legal name of the business or if the tradename had been properly filed with the SCC.
Do not let this happen to you! Always make sure that the full legal name of your business entity is disclosed to the third parties with whom your entity does business; and make sure that you always sign as an agent of the business.
Wednesday, December 23, 2009
Traffic Offenses in Fairfax, VA
Recently, Gross & Romanick helped a client’s elderly father with a criminal traffic matter. Afterward, our client wrote to say: “You came through when my family badly needed help, and I very much appreciate your efforts. There is a good reason the folks at the Fairfax Courthouse recommend you so highly!”
If you’d like to speak to one of the attorneys at Gross & Romanick about a criminal traffic matter in the Virginia, DC or Mayland areas, contact us by calling 703-273-1400 or filling out our online Information Request form. We’d be more than happy to discuss your case with you.
If you’d like to speak to one of the attorneys at Gross & Romanick about a criminal traffic matter in the Virginia, DC or Mayland areas, contact us by calling 703-273-1400 or filling out our online Information Request form. We’d be more than happy to discuss your case with you.
Tuesday, February 3, 2009
What should I do if I am involved in a car accident?
Gross & Romanick recommends that you take the following steps:
1. Immediately call for medical assistance if any party to the accident, including yourself or any passengers in your vehicle, is injured. If you believe you may be injured, do not tell the other parties to the accident, the police, or any other responding parties that you are “fine” or “okay”, and do not refuse medical assistance if offered. These actions may later be used against you should you assert a claim for injuries that you actually suffered.
2. Exchange insurance information with all parties involved in the accident. Be sure to obtain the following information from each driver:
- The name of the driver;
- The name of the driver’s insurance company;
- The driver’s insurance policy number; and
- The name and phone number of the driver’s insurance agent.
3. Obtain the following information about each vehicle involved in the accident:
- The name of the owner of the vehicle;
- The license plate number of the vehicle; and
- The year, make and model of the vehicle.
4. Obtain the names, phone numbers and addresses of all passengers in the vehicles involved in the accident.
5. Obtain the names, phone numbers and addresses of all pedestrians involved in the accident and all other witnesses to the accident.
6. If possible, take pictures of the scene of the accident and the surrounding area.
7. If your vehicle is towed from the accident site, obtain the name of the towing company, its location and its phone number.
8. If police officers respond to the scene, obtain each officer’s business card, badge number and the accident report number.
9. In speaking with the other parties to the accident, witnesses, and the police, do not volunteer that the accident was your fault. You may be wrong, and this admission can later be used against you.
10. Contact your insurance carrier as soon as possible and obtain a claim number. Your carrier will begin an investigation into the accident, and you are required by your policy to cooperate with your carrier. However, if your insurance company would like a recorded statement, and you are unclear about your rights with respect to the accident or intend to hire a lawyer, you should inform them that you would first like to speak to an attorney.
11. If necessary, follow your carrier’s instructions with respect to repairing the damage to your vehicle.
12. Under no circumstances should you discuss the accident with the other parties to the accident, their insurance carriers, or any private investigators. If you are contacted by the insurance carrier of another party to the accident, you have no obligation to speak with them, and you should not do so without first consulting an attorney.
13. If you are in legitimate need of medical attention in the hours or days following the car accident, see a doctor or visit the emergency room.
14. If you have been injured, you should contact a lawyer, as it is important that you fully understand your rights and responsibilities with respect to the accident, and do not make any mistakes that can jeopardize your claim.
If you are in need of a lawyer, the experienced attorneys and staff at Gross & Romanick can clearly explain to you the claim process, can help you prepare, organize and file your claim, and can skillfully negotiate your claim to a favorable outcome. If necessary, the attorneys at Gross & Romanick are fully prepared to file a lawsuit and advocate your claim in Court.
1. Immediately call for medical assistance if any party to the accident, including yourself or any passengers in your vehicle, is injured. If you believe you may be injured, do not tell the other parties to the accident, the police, or any other responding parties that you are “fine” or “okay”, and do not refuse medical assistance if offered. These actions may later be used against you should you assert a claim for injuries that you actually suffered.
2. Exchange insurance information with all parties involved in the accident. Be sure to obtain the following information from each driver:
- The name of the driver;
- The name of the driver’s insurance company;
- The driver’s insurance policy number; and
- The name and phone number of the driver’s insurance agent.
3. Obtain the following information about each vehicle involved in the accident:
- The name of the owner of the vehicle;
- The license plate number of the vehicle; and
- The year, make and model of the vehicle.
4. Obtain the names, phone numbers and addresses of all passengers in the vehicles involved in the accident.
5. Obtain the names, phone numbers and addresses of all pedestrians involved in the accident and all other witnesses to the accident.
6. If possible, take pictures of the scene of the accident and the surrounding area.
7. If your vehicle is towed from the accident site, obtain the name of the towing company, its location and its phone number.
8. If police officers respond to the scene, obtain each officer’s business card, badge number and the accident report number.
9. In speaking with the other parties to the accident, witnesses, and the police, do not volunteer that the accident was your fault. You may be wrong, and this admission can later be used against you.
10. Contact your insurance carrier as soon as possible and obtain a claim number. Your carrier will begin an investigation into the accident, and you are required by your policy to cooperate with your carrier. However, if your insurance company would like a recorded statement, and you are unclear about your rights with respect to the accident or intend to hire a lawyer, you should inform them that you would first like to speak to an attorney.
11. If necessary, follow your carrier’s instructions with respect to repairing the damage to your vehicle.
12. Under no circumstances should you discuss the accident with the other parties to the accident, their insurance carriers, or any private investigators. If you are contacted by the insurance carrier of another party to the accident, you have no obligation to speak with them, and you should not do so without first consulting an attorney.
13. If you are in legitimate need of medical attention in the hours or days following the car accident, see a doctor or visit the emergency room.
14. If you have been injured, you should contact a lawyer, as it is important that you fully understand your rights and responsibilities with respect to the accident, and do not make any mistakes that can jeopardize your claim.
If you are in need of a lawyer, the experienced attorneys and staff at Gross & Romanick can clearly explain to you the claim process, can help you prepare, organize and file your claim, and can skillfully negotiate your claim to a favorable outcome. If necessary, the attorneys at Gross & Romanick are fully prepared to file a lawsuit and advocate your claim in Court.
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