New York Commercial Lease Basics: Negotiate a Good Guy Clause For Your New York Start-Up

New York start-up businesses can negotiate a Good Guy Clause into their NY commercial leases to gain flexibility in terminating leases should things go upside down. A New York Good Guy Clause is commonly used in New York City as a personal guaranty within a commercial lease.  In exchange for a guarantee from the tenant or an affiliate of the tenant to fulfill all obligations under the lease, the commercial NY landlord agrees to allow the New York tenant to terminate the lease early so long as all rent has been paid in full and the tenant gives sufficient notice.  The premises must be delivered “broom-clean” with all possessions and trash removed. Good Guy Clauses in New York may protect both the commercial landlord and tenant.  These clauses protect commercial landlords in New York City because these clauses avoid landlord-tenant litigation and, if there is a party other than the

Continue reading

Suit Claiming NY’s Daily Fantasy Sports Law Is Gambling, Not Skill

An anti-gambling reform group filed a lawsuit last week claiming that New York’s “Daily Fantasy Sports” law violates the NY State constitution by characterizing daily fantasy sports contests as games of skill, rather than games of chance. The suit was filed in New York Supreme Court in Albany County by an organization called Stop Predatory Gambling on behalf of four New York resident plaintiffs who claim to have been negatively impacted by gambling. According to published reports, the suit “seek(s) to protect the public from predatory gambling consistent with the constitution.” Article 1, Section 9 of the state constitution, states, in part that “[n]o law shall be passed… except as hereinafter provided, no lottery or the sale of lottery tickets, pool-selling, bookmaking, or any other kind of gambling, except lotteries operated by the state… except pari-mutuel betting on horse races…  and except casino gambling at no more than seven facilities

Continue reading

What NY Businesses Should Learn From the United States v. Texas Immigration Decision

The Supreme Court’s decision in United States v. Texas this past June upheld a challenge to a pair of executive orders on immigration. While the political rancor continues on the issue of immigration, especially on the grand stage of election politics, businesses should remain vigilant in the evolution of immigration law on this front. First, businesses are still obligated to use Form I-9 to verify the legal status of new employees even though the form expired.  Noncompliance may lead to monetary penalties up to $16,000 per violation. Second, businesses relying on foreign skilled workers eligible for an H1-B visa should start planning for the next fiscal year – now.  As a result of this Supreme Court decision, the cap on skilled foreign employees remains at 65,000. The USCIS has began accepting H1-B petitions for the 2017 fiscal year, with more than 236,000 petitions filed. Clearly, businesses cannot turn a blind eye

Continue reading

NLRB Judge Rules Chipotle Is Liable For Labor Violation For Enforcing “Unlawful” Social Media Policy

This week, the National Labor Relations Board (NLRB) ruled that Chipotle Mexican Grill had an “unlawful” social media policy that violated the National Labor Relations Act (NLRA). According to published reports which detail the facts of this particular case, the dispute stems from charges filed on the worker’s behalf by the Pennsylvania Workers Organizing Committee regarding Chipotle’s social media policy and allegations that the employee was wrongfully terminated. Apparently, Chipotle sought to enforce an “oudated” social media policy that was not lawful under the NLRA. This policy had already been replaced, but supervisors sought to enforce the older policy against an employee who made postings on Twitter criticizing his employer about adverse working conditions. Since the outdated policy is what prompted Chipotle to act, the NLRB found that Chipotle was liable for violations that occurred resulting from enforcing that improper policy.   According to the NLRB’s website, the NLRA protects the

Continue reading

COBRA Basics for New York Businesses

To conclude our series on federal laws that every small business owner must know, we discuss an employer’s obligation to provide health insurance under New York law.(For other stories in this series, you can read our posts about best practices to avoid age discrimination, New York’s new laws involving family and medical leave and federal and state protection of employees with disabilities.) Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), employees and their families are protected should they lose employer-sponsored health benefits. In general, most employers with 20 or more “employees” sponsoring health plans on more than 50 percent of its typical business days in the previous calendar year must offer each “qualified beneficiary” who would otherwise lose coverage under the plan because of a “qualifying event” an opportunity to elect continuation of the coverage received immediately before the qualifying event. The definition written above can seem complicated at first because it contains

Continue reading

NY’s Family Leave Law: What It Means For NY Small Businesses

Earlier this year, New York enacted the NY Family Leave Law, which mandates NY businesses, including small businesses, to provide family leave for most employees.  This article is part of our ongoing series of laws that NY small business owners should consider.  Under the new law Family Leave Law in New York, your NY business must offer both full-time and part-time employees who have been employed for a minimum of six months up to 12 weeks paid time off if they are (a) new parents (including adoptive parents); (b) individuals who need to take care of a family member with a serious medical condition; or (c) individuals with a need to relieve family pressures after a spouse, domestic partner, child or parent has been called to active military service.  The new law applies to every kind of business.  There is no exception for NY small businesses. Starting on January 1, 2018, eligible employees can

Continue reading

NY’s Daily Fantasy Sports Law Contains Major Flaw

In following up on an earlier post we wrote about the waiting game set up by the New York State government for daily fantasy sports, we are happy to report that DFS businesses like FanDuel and DraftKings are back open for business in New York. NY Gov. Andrew Cuomo signed a bill into law allowing fantasy sports operators to apply for a license in New York state. The new New York Gambling Law also makes provisions for operators to serve the market almost immediately via a temporary permit. And this is where a controversy may still be brewing. According to DFS advocates, the NY State Gaming Commission erred in implementing the law because DraftKings and FanDuel agreed to cease operating  in order to ensure that they would be eligible for a license.  According to Legal Sports Report, the application itself states that a DFS operator is eligible if it makes available an interactive

Continue reading

Can a Hashtag Be Registered As A Trademark?

Talking to a colleague today, we both came upon an interesting legal question: is a social media hashtag a trademark that one can register? For those who are not familiar with hashtags, it is a word or phrase preceded by a “#” that accompanies text. Hashtags are used to categorize the content of a social media posting on Facebook, Twitter and other platforms, group content together and make social media postings searchable. Businesses use hashtags to promote product and engage audiences throughout social media. Social media platforms have even developed a stream of revenue by allowing businesses and individual to “promote” hashtags and receive preferential listing on their websites. The emergence of social media hashtags has had a huge impact in social media marketing. It is a great way to communicate social media messages, build brand loyalty and associate identifying characteristics with a brand and its audience. According to the

Continue reading

New NLRB Labor Rules Negatively Impact U.S. Franchises

Revised federal rules from the National Labor Relations Board that give employees more leverage in settling workplace disputes are negatively impacting franchisors and franchisees, leaving them with higher costs and forcing them to scale back plans for future expansion. The new policy adopted by the National Labor Relations Board (NLRB) broadens the circumstances in which two businesses can be deemed as employers of the same pool of workers. This means trouble for fast-food, construction and other industries reliant on contract workers and employees of franchisees, who will now be exposed to increased labor disputes before the NLRB, which adjudicates workplace disputes and oversees union-organizing. The intention behind the NLRB’s revision is to ensure workers can unionize and collectively bargain with businesses that help control their fates.  As things stand now, the NLRB will review “test cases” in the franchising industry to further define what critics have called a vague and

Continue reading

Filing a DBA Name In New York

If you want to conduct business under a trade name that is different from the name used to form your New York business, then you need to file a DBA, or a “doing business as” name, in New York. DBAs are useful for a number of reasons. They allow a business to open a bank account under a different name. They also allow a business to build a brand or product in a name other than the legal name of the business itself. Perhaps the most well-known example of a company using a “DBA” is Doctor’s Associates Inc., which is doing business under the well-known brand “Subway.” As the story goes, Doctor’s Associates Inc., which derives its name from the principal owner’s initial goal to earn enough money to pay for school tuition, was created for the operations of “Subway.” There are different requirements for different entities wishing to create a

Continue reading

NY Agency Law Basics: Obtaining an agent to distribute your products in New York

New York Agency law deals with the relationship between an “agent,” and a “principal.” An agency relationship forms when a principal asks an individual to act on behalf of the principal and the action of the agent may bind the principal in some way.  Agency, in short, is a fiduciary relationship where an agent acts for a principal subject to control of the principal. Under these circumstances, a principal will be liable for contracts entered into by agents when (1) the a fiduciary relationship exists between an agent and principle  (2) the agent acted with some kind of authority, and (3) a contractual obligation is created between the agent and a third party.  The idea of authority can be a tricky one to nail down. Actual, Apparent  & Inherent Authority to Act for a Principal in New York An agency relationship can be, and often is, enforced by written agreements

Continue reading

Federal Trademark Basics: What You Can Learn From The “New York Fashion Week” Trademark Controversy

A growing controversy over the use of a widely-known phrase in the New York fashion industry is a perfect example of why you need to protect your trade names and marks immediately. If you are fashion-forward, or a New York resident, then you have probably heard of the phrase “New York Fashion Week,” which signifies a week-long grouping of events where designers reveal their latest creations put on by the Council of Fashion Designers of America (“CFDA”) and WME-IMG (formerly known as William Morris Endeavor.) Recently, CFDA and WME-IMG were sued by Fashion Week, Inc. for infringing upon its use of the trademarked phrase “New York Fashion Week.” The lawsuit follows a ruling from earlier this year by the Trademark Trial and Appeal Board (TTAB) determining that CFDA and WME-IMG do not have legal rights to the name. In that trademark proceeding, CFDA argued that the trade organization and “its predecessors-in-interest

Continue reading

Proven Negotiation Tactics For New York Small Businesses

When you are running your own business in New York, you must become a skilled negotiator.  New York can be a tough place and many sharks abound. In its simplest form, negotiation means a discussion between parties looking to reach an agreement. While the concept is easy to understand, the process of negotiation is as much art as it is science. As a start on your road to becoming a good negotiator, here are some basics to think about before beginning the negotiating process. Know Your Worth Many people feel that the hardest thing to learn is their own self-worth. You and your business have much to offer – know that you are good enough to ask for the money you want! If you don’t believe in yourself, how do you expect to convince someone else to believe in you or your business? Understand Your Worth Information is power. Know

Continue reading

Authenticating International Documents for use in New York

If you want to enforce a judgment in New York, or any other international document, headed to or coming from another nation, you should understand the process by which those documents are authenticated. An American court will not take a foreign document at face value. It must be authenticated before it can be considered by a New York court. That means the document must go through a process of authentication, or legalization. Most documents require and Apostille. The easiest method is to obtain an Apostille, which is an authentication of a public document that governments issued if they are a party to the 1961 Hague Convention abolishing the Requirement of Legalization for Foreign Public Documents. The Convention provides for simplified certification of public and/or notarized documents to be used in countries that have joined the Convention. Signatory countries have agreed to recognize public documents issued by other signatory countries under

Continue reading

Subjective Phrases In Your Contracts

When negotiating your contracts, normally, you should stay away from subjective phrases or you may be leaving yourself open to a court’s interpretation. Subjective phrases are those that are shaded by feelings, experiences and depend upon one’s individual point of view.  More often than not, they are loosely-defined words and phrases that may mean one thing to you, but something else to the other party. These phrases are like landmines in your contract, and must be avoided, if possible: Avoid phrases like “reasonable” or “best effort.” While attorneys may make a distinction between the two, courts have inconsistently applied the two, sometimes even merging the standards. While that would be alright if business goes smoothly, it could create protracted litigation if things turn bad. Avoid phrases like “material” and “substantial” unless you specifically define its meaning in your contract. Failure to define a term is an invitation for allowing a court

Continue reading

Protect Your NY Company’s Confidential Information

Every NY business keeps confidential information that it must protect from three common occurrences in the course of operations: Accidental Disclosure The most common way a NY business will lose protection of confidential information is through accidental disclosure. This is most likely because NY businesses fail to outline to employees, independent contractors, consultants and service providers what information must remain confidential. Failure to Create Confidentiality Agreements & Non-Compete Agreements Sometimes, a NY business may identify the confidential information that it will need to offer to an employee, independent contractor, consultant or service provider, but not take any additional steps to preserve that confidentiality. If and when that confidentiality is breached, the NY business is left with little to no legal recourse, in most cases, until the business has a confidentiality agreement. Theft by Ex-Employees Some employees who leave a NY business may be tempted to make a copy of confidential

Continue reading

Definition of a Franchise in New York State: New York Franchise Law Basics

New York has a broad definition of a franchise, thus, leading to a broad range of mere “licensing” and “agent/distributor” relationships as franchises.  Any business organization that is deemed or may be deemed a franchise by the State of New York should, immediately, retain a New York-based franchise attorney with significant experience in the business and legal side of franchising in NY.  A designation of a business relationship as a franchise, immediately, requires obligations of the franchisor including disclosure and registration requirements.  Our New York franchise lawyers shall be writing followup articles on franchise obligations under New York law over the next few weeks. Definition of a Franchise in New York Section 608 of the New York code defines a franchise in New York as: 3. “Franchise” means a contract or agreement, either expressed or implied, whether oral or written, between two or more persons by which: (a) A franchisee

Continue reading

NY Small Business Expo Expands Horizons & New York Contacts

The Jacob Javits Convention Center had a great expo – NY Small Business Expo. Whether your business is in the startup phase or is long-established, the Small Business Expo is a one-day free exhibition that features many exhibitors with a diverse range of resources. The Expo is nation’s largest business-to-business expo, the Small Business Expo has made it it’s mission to help small business owners and entrepreneurs achieve their business dreams by educating and creating network opportunities. The day’s events ranged from a large range of vendors to meet and greet, a speed-dating-like area for “lightning networking,” and workshops on a wide variety of topics.  Space was even set aside for networking based upon the nature of your business. With so many opportunities to establish contacts to help improve your business, the NY Small Business Expo is worth attending next year. For a no cost consultation, CONTACT US for an

Continue reading

Are NYC Rent-Controlled Tenants Using AirBnB Breaching Their Leases?

AirBnB may be an answer to homeowners and property owners looking to supplement income, but if you are a New York City landlord of a rent-controlled property – beware!  Your tenants may be breaking the law!  For the uninitiated, AirBnB is an online marketplace where prospective guests look for a bed to stay in from hosts listing spare rooms and properties for short term rentals.  They operate very much like a hotel where guests stay in the host’s property for a fee. In New York City, landlords and property managers have been cracking down on tenants seeking to get in on the AirBnB action by subletting out their space for amounts exceeding their subsidized rent, in clear violation of the New York Landlord-Tenant Law.  Recent decisions shed some light on why AirBnB, though seeing a growth in popularity, are facing many legal issues when the hosts is not the property owner.

Continue reading

A Good Business Plan May Turn your New York Startup Into Dollars

Recently, we wrote about the two main tools available to small businesses to stir interest in and investment in your business – the business plan and the private placement memorandum.  While this blog is, mainly, for New York businesses, the following article can apply to business throughout the world. A business plan is a document created by businesses with a few goals in mind.  It should introduce your business idea, describe the fundamentals of your business and provide financial data to show potential investors that your business idea may be profitable. A business plan canentice potential investors or simply be a road map for yourself to chart the course of your business.  For now, let’s focus on how to use a business plan to raise money for your start-up. If you want your business plan to be attractive to investors, it must be a more persuasive document than a simple

Continue reading