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Bart Scott’s New Trademark?

Can a celebrity say a phrase on television and then register that phrase as their trademark?  That is exactly what Bart Scott of the New York Jet’s is trying to do.  On January 17, 2011 in a post-game interview Bart Scott said, “can’t wait” in reference to the upcoming playoffs tournament in Pittsburgh.  Now, Scott has hired an attorney and filed a registration application with the U.S. Patent and Trademark Office to obtain a trademark for this phrase.

HOW IT WORKS

The rules and procedures for registering a trademark are the same for everyone and every business.  The proposed mark has to represent a product or service of some type, it has to be used in commerce and it can’t be confusingly similar to another trademark.  In this case, Scott is attempting to register “can’t wait” under a 1(b) filing which means he isn’t claiming to be using the trademark right now but he’s promising that he has a bona fide intent to use the trademark at some future date.  The U.S. Patent and Trademark Office will not issue a trademark registration for Scott’s mark until he has begun to use it in commerce and has supplied their office with a specimen to prove how it is being used.  Of course, there will also be a time period in which the public can challenge his assertion of rights to this trademark by filing an opposition with the U.S. Patent and Trademark Office.

BART SCOTT’S GOODS

In this case, Mr. Scott has filed an application in which he claims a bona fide intent to use the mark “can’t wait!” on men’s, women’s and children’s clothing.  He isn’t claiming that he is using this mark in commerce right now only that he plans to do so.  He doesn’t actually have any rights to this potential trademark just yet.  He will have to produce a product, presumably a T-shirt that has “can’t wait!” splashed across the front before he will be able to convince the U.S. Patent and Trademark Office that he has rights to this mark.

ANSWER

The answer is “no” people, including celebrities, cannot claim trademark rights to words or phrases simply by virtue of vocalizing these in public (despite what pop culture might tell you).  The word or phrase has to be used in commerce on a product or service and it cannot be confusingly similar to another trademark.

What Makes A Business Legit?

I am often asked whether I think a business idea is “legit”?  My mental, unspoken response is always, “if you think it is or think it isn’t, you’re right.”  In other words, you as an entrepreneur are in control of whether your business is legit.  With that in mind, it doesn’t hurt to have a team of professionals performing technical work on your behalf to help your business achieve legitimacy.  Believe or not, you can’t shouldn’t do it all yourself.

Here are a few ideas for ensuring your business is legit:

• Choose a name that is unique enough to set you apart from your competition.
• Keep records and document the actions of your business.
• Pay your bills.
• Make business decisions guided by your conscience.
• Do business your way, not the way everyone else does it.
• Give back to your community.

Raising Money: The Private Placement Memorandum

Millions of dollars are raised every year by highly motivated small business entrepreneurs.  Most of that money doesn’t come from the bank.  Banks are very conservative and risk averse when it comes to lending money to small businesses.  Bank wants to see your business generating money before they will make a loan.  As we all know, it takes money to make money.  Many small business entrepreneurs turn to family, friends, savings accounts, retirement accounts or private angel investors for funding.  Whenever you raise money from friends, family or other private investors you need to be give them a document called a private placement memorandum.  A private placement memorandum, commonly called a PPM, is a disclosure document given to investors. Usually when a company wants to raise money they will offer to sell a piece of the company to private investors rather than to the public at-large. Investing in a company always involves a certain element of risk. Investment risks, business objectives, management and capital structure are commonly disclosed in a PPM. For entrepreneurs, the PPM is a critical piece of documentation because it provides a safety back-drop against potential claims by investors. By way of simplistic illustration, imagine you started a lemonade stand and your neighbor gave you $100,000 in exchange for 50% of the profits (notice this isn’t a loan). After years of buying lemons and making lemonade you still haven’t been able to sell any lemonade. Your neighbor might get anxious and ask for his money back. Unfortunately, the money has all been spent on lemons. Now what do you do? Hopefully, you gave your neighbor a PPM so he was aware of the risks. It is a simple fact that businesses fail. When businesses fail, investors usually lose money. On the flip side, when businesses succeed investors usually reap enormous windfalls.

BORING (but important) LEGAL STUFF ABOUT FEDERAL SECURITIES REGULATIONS

When you sell a piece of your company typically you sell shares of stock in your corporation.  This intangible is also referred to as equity in a company.  It basically means you are an owner of the company.  This intangible ownership interest is called a security.  When you offer to sell securities to family, friends or investors it is called a securities offering.  The offering is subject to regulation under the Securities Act of 1933, which are designed to prevent fraud by requiring complex and extensive disclosure and registration of offerings. Complying with the registration requirements of the Act can be time consuming and quite expensive. However, there are exemptions to the registration requirements for some private offerings. Rules 504, 505, and 506 of Regulation D allow for an exemption from registration if certain conditions are met. In addition to federal laws, state laws also regulate the sale of securities by companies. These laws are typically referred to as “Blue Sky” laws. Compliance with these laws in your offering is a necessary part of raising capital for your company. The private placement memorandum gives a company the chance to make some of the same disclosures that are required in a public offering.

DISCLOSE, DISCLOSE, DISCLOSE

Sales people everywhere live and die by the phrase “under sell and over deliver.”  The same concept applies when you are raising money.  Appropriate disclosures in a PPM are a way of “under selling” your business and setting the right expectation with investors.  Equally important is providing investors with the right type of information.  Most PPMs will have the following sections:

• Summary of the Investment
• Risk Factors
• Use of Proceeds
• Capitalization
• Business Plan
• Management
• Description of the Securities
• Terms of the Offering
• Legal and Tax Matters

Mark My Words (and Logos).

Can you actually register that fantastic name, logo or slogan that represents a valuable product or service as a trademark and prevent other companies from using that same name, logo or slogan?

Is your mark qualified for federal registration or will the US Patent and Trademark Office (USPTO) deny your application?

Whether a mark is qualified for federal registration depends upon the following factors:

1. The USPTO must consider your mark to be distinctive.
2. The mark cannot legally conflict with another mark.
3. The mark has to be in actual use.
4. The mark’s use must be subject to Congressional regulation.
5. The mark cannot be scandalous, immoral or deceptive.

If you want to find out more about these five factors, please fill out our contact form and we will email you a pamphlet that explains in more detail the qualifications for obtaining a federally registered trademark.

Basics of an Enforceable Contract

Contracts are a fundamental part of our economy.  Every time you buy something from a grocery store or a department store you are entering into a contract.  You don’t have to sign a piece of paper to enter into a valid and fully enforceable contract.  Some contracts can be oral while others must be reduced to writing.  So what exactly makes a contract binding?  There are two main requirements for a contract to be binding and enforceable:

1. Consideration
2. Mutual Assent

Consideration

Consideration is a legal term for quid pro quo.  In other words, consideration is something of value that is offered in exchange for something else of value.  In everyday experience, when you buy a box of Krispy Kreme donuts you give up some money and in exchange the store gives up the donuts.  Both the money that you give up and the donuts that the store gives up have value to the respective parties.  Essentially there are two separate concepts required for consideration to be valid and enforceable.

The first concept is the actual sought after exchange.  In legal circles this is called the “bargained for exchange“.  In my previous example when you go looking for Krispy Kreme donuts you are seeking out an exchange.  Additionally, the store that offers the donuts for sale is also seeking out an exchange.  In other words, there are at least two parties looking to exchange something that the other party has to offer.

The second concept involves giving up something of value in order to get something of presumably greater value.  However, often parties to contracts are seeking to exchange intangible items.  Unlike donuts and cash, intangible items might be something like a promise to provide a service.  A good example of this is the arrangement you have with your cell phone company.  The cell phone company promises to give up cellular bandwidth in exchange for your promise to pay them for such use at the end of each month.

Mutual Assent

Mutual Assent is another legal term for a shared understanding of contractual obligations between parties.  In other words, mutual assent is present whenever there is an offer from one party that is accepted by the other party.  Going back to the donut example, the grocery store offers the donuts for a specified price.  This is the offer.  When you give the cashier the asking price for the donuts you are accepting the offer and entering into a binding and enforceable contract.  Mutual asset cannot exist until both parties understand and agree to be legally bound by their respective obligations.

Most simple contracts do not require the assistance of counsel.  Contracts are really just common sense.  However, if you are an entrepreneur, doctor or other self-employed professional you will eventually get into more complicated transactions where legal technicalities will be ever present.  It is in these instances when you should have a professional draft and review your agreements.  A major cause of expensive business litigation is a poorly drafted contract.  Now you know contracts and knowing is half the battle!

Understanding The Difference Between C Corporations And S Corporations

Based on many financial and technical factors, corporations are categorized into different types. Of these categories, two key types of organizations are ‘C Corporations’ and ‘S Corporations.’ A ‘C Corporation’ or a ‘C-Corp’ is a corporation that qualifies for the taxes under the Sub chapter C of the Internal Revenue Code of the Internal Revenue Service (IRS). Simply said, a C Corporation is a standard corporation and most of the organizations in the U.S. are incorporated as C Corporations. An ‘S Corporation’ or ‘Subchapter S Corporation’ on the other hand, enjoys special tax exemption under the Internal Revenue Code. An S Corporation is exempted from the Federal Corporate Income Tax.

Factors Differentiating C Corporations and S Corporations

TaxationTaxation is the key difference between the two types of corporations. C Corporations face double taxation. They face one form of taxation at the individual level, and the other at the corporate level. The government taxes the corporation on its profits and the company’s shareholders also pay taxes on the company driven earnings such as dividends or any other special payouts. S corporations are exempt from this form of taxation. Instead, profits and losses are passed on to the shareholders according to their stake in the company. The shareholders pay the taxes for an S corporation at the individual level. The shareholders deduct any business losses in their individual tax returns. Also, S corporations can elect to distribute money as profits rather than as salaries to the shareholders. These S corporation profits are exempt from Social Security and Medicare taxes. At the time of selling the corporation as well, the tax on the profits is lower for the S Corporations than for the C Corporations.

OwnershipA non-US citizen or a non-resident alien can own C Corporations, apart from US citizens. Only US citizens or resident aliens can own S Corporations.

Business EntityOther business organizations may own C Corporations, but they can’t own S corporations.

Number of Shareholders or MembersC Corporations can have an unlimited number of shareholders. The number of shareholders in an S Corporation is limited.

Stock types or ownership interestC Corporations can issue all types of stocks. S corporations can issue only one type of stock and they can’t issue preferred stocks

Timely Status ElectionThe IRS requires S Corporations to file for S Corporation status by the sixteenth of the third month of the tax year in which the election is due. Alternatively the company may file this form at anytime in the tax year preceding the tax year in which the election is to take place. An election completed within two and a half months of the beginning of the tax year is a timely election. An election made after the middle of the third month but before the end of the current tax year will be effective in the next tax year. C Corporations do not require any time frame.

An Additional ThoughtEach type of corporation has its own advantages and disadvantages. A well informed and well-thought out decision should be made upon the type of corporation you wish to file the articles for.

About the AuthorDavid Gass is President of Business Credit Services, Inc. His company publishes afree weekly e-newsletter on Small Business Consulting at their web site http://www.smallbusinessconsulting.com

Article source: Understanding The Difference Between C Corporations And S Corporations

Why Choose Delaware as Your Corporate Home?

What state Incorporates more than a half-million business entities, including more than half of the Fortune 500 companies? New York? California? Illinois? No. No. No. That state is Delaware. With a population smaller than 88% of all states, this business-friendly state attracts more corporations than any of the major cities. Businesses choose Delaware simply because of their flexible corporate laws, highly respected Court of Chancery, a business-friendly State Government, and a customer service oriented Staff of the Delaware Division of Corporations.

Among the many business-friendly laws, Delaware does not require corporations to operate in the state, only to maintain a registered agent, who may be an individual resident, or an existing domestic corporation. Additionally, incorporations typically take 24 hours to process, however there are services that allow same day, and 2 hour filing. There is no corporate income tax for corporations incorporated in Delaware, but not transacting business in the state. Further, the cost to incorporate is one of the lowest in the country, and one person can hold all officer positions of the corporation. Officer names are not required to be listed in the articles of incorporation. Shares of stock owned by persons outside of Delaware are not subject to Delaware taxes.

Delaware maintains a separate corporate court system, called the Delaware Court of Chancery, that does not use juries, but only uses judges appointed for their expertise in corporate law. The Delaware Court of Chancery is a 210-year-old business court that has written most of the modern U.S. corporation case law. It is widely recognized as the nation’s most distinguished agency for dispute resolution involving corporate litigation. The state legislature takes seriously its role in keeping the corporation statute, and other business laws current. Their unique expertise in, and exposure to issues of business law are supreme. Currently the Court of Chancery has made docket information, and pleadings available over the Internet for civil actions filed in the Court.

Delaware’s State Government is business-friendly and accessible. The Division of Corporation is in the forefront of efficiency, and their professional staff provides prompt, friendly services to clients, attorneys, registered agents and others. The office of the Secretary of State operates more like a business rather than a government bureaucracy with its leading edge technology, and customer-service oriented staff.

Delaware may make sense for large corporations, however it may not be worth the effort for small, privately held corporation who do business in their home state. Although Delaware does not tax out of state businesses, taxes must be paid in the state the business is operating. While incorporating fees are lowest in Delaware, appointing a corporate agent to receive official notices in Delaware may negate any realized costs savings. All factors considered, Delaware is a premiere legal home to companies all around the world.

About the AuthorJay B Stockman is a contributing editor for Online Small Business Consulting Visit http://small-business-usa.com/ for more information.

Article source: http://www.contentdragon.com/content/business/why-choose-delaware-as-your-corporate-home/