February 27, 2011 in Business, Legal Articles by jferris

Successfully Navigate Business Aircraft Financing with an Aviation Attorney and Acquisition Consultant

With business planes at record low prices, buyers have a rigid set of rules to now adhere to in order to get financing. The key is to start looking for financing early on in the process to take advantage of motivated sellers and outstanding prices.

Banks are scrupulously cautious and require a lot of buyer documentation and their own due diligence to ensure the aircraft’s value, so borrowers do not want this part of the purchase to knock them off a great deal. A reputable aviation transaction attorney and acquisition consultant can assist with pre-purchase finance agreements and inspections to calm a lender’s nerves about the value.

Lenders look to assist with financing for the most well maintained aircraft, and shrug their shoulders at anything more than 20 years old. Because of elevated supply levels, five to 10-year-old planes are the most attractive, unless the buyer wants a special airplane, can put more money down, and have a shorter loan term to help protect the lender’s outlay of money.

“Our firm helps buyers navigate the difficulty of finding a bank, accounting for escrows, and even planning for years down the road should you want to sell or lease the aircraft you buy today,” said Stewart Lapayowker, aviation attorney.

Loan commitments and closing can easily take a month or more, and patience is key with the whole process. Lenders are hawks, and take a hard look at the prospective borrower. Missed payments, overextension of credit, defaults, and level of financing on current airplanes are examined thoroughly. Lenders have been hit hard and want to make sure clients can afford two or more airplanes or could realistically sell one if that is the objective after closing on the new one.

With investment grade businesses and high-net worth buyers, it comes down to what’s the better use of their capital. If the $6 million purchase price is financed at a low percentage, which is often tax deductible, it might be more attractive to finance and use $6 million of liquid assets on other investments. The norm is 15 percent down with three to five year loan schedules, and sometimes clients can go down to 10 percent depending on the credit profile. A lot of lenders want the borrower to have enough money to cover damages the aircraft manufacturer might be entitled to if the borrower defaults. Or, some clients prefer to go with lease financing that offers greater flexibility than normal borrowing, and has five to seven year loan terms.

Banks will have varying stances on the most worthy borrowers. Some banks want only existing customers or soon-to-be ultra high-net worth clients. But if the bank has already given out other margin loans, boat or real estate loans, or for certain clients membership in a bank loan syndicate, banks are wary about lending them more money and increasing their risk. That’s when you’ll want to turn to aircraft financial institutions to see what they have to offer since they specialize in accommodating new buyers every day.

With delays and maximum scrutiny, many buyers have gone the cash route, and have accounted for close to 75 percent of all transactions in 2010. “Many clients use liquidity margin accounts to close a deal quickly,” Lapayowker said. “We can then help them assess whether it is smart to finance long term.”

href=”http://www.businessaviationcounsel.com”>aviation attorney and aviation transaction lawyer, focusing on airplane and jet transactions. To learn more, visit Businessaviationcounsel.com.

February 26, 2011 in Business, Legal Articles by jferris

Airplanes Shown to Be a Smart Business Tool to Increase Financial Performance

Affordability and implementation of operating a plane for business or a flight department is at its peak. The knowledge an aviation transaction attorney can bring to the purchase is paramount to this big investment. Many companies don’t blink an eye at operating a fleet of trucks or cars, so many companies could take advantage of airplanes as even better business tools.

“In this economy, it’s all about knowing when and how to expand your flight operations,” said Stewart Lapayowker, aviation lawyer. “A good attorney can help you see the pros and cons of the different ownership styles.”

A study from NEXA Capital Partners that was released in late 2010 showed that small and medium businesses that used business airplanes outperformed their competition. A total of 385 businesses from the S&P Small Cap 600 were surveyed and in every single category they benefited from using planes as tools to increase: financial performance and shareholder value; boost customer satisfaction, retention and referrals; improve productivity and minimize the impact of the recession; and access more remote destinations not serviced by commercial airlines. The study shows that during the last five years, business aviation users had an earned net income at a pace of 219 percent over nonusers. Most compellingly, business aviation users earned $3.19 for every dollar earned by a nonuser.

Back in 2009, NEXA surveyed big businesses and found similar results on business aviation users surpassing nonusers on all business metrics. All these facts demonstrate that even in a down economy, business aviation is a crucial part of making any business successful. A business can still be fiscally conservative and make long-term plans that include planes, and an aviation attorney can make the purchase, financing, and management of corporate aircraft a smart, calculated decision.

After a buying team is chosen, an attorney can help with negotiations, creating and executing legal documents as well as purchase agreements, leases, and charter management agreements. From there, a lawyer will assist with the registration with the Federal Aviation Administration and International Registry and provide advice on stateside and international operation of the airplane. Many companies have their tax advisors work with an attorney to go over federal and state taxes, ownership structures, and tax-deferred exchanges. A business’ insurance agents also are a critical factor and will work with a lawyer to control and limit exposure to risk in an economic and efficient policy.

“Advising clients on how to maximize the benefits and decrease liabilities when buying a plane, setting up a flight department, and managing the operations is key,” said Lapayowker, whose law firm in Fort Lauderdale, Fla., focuses on private and corporate aviation transactions worldwide, from the United States, South America, the European Union, Asia and the Middle East. “There are so many legal, regulatory, tax, operational, and financial considerations to be well versed in.”

Stewart H. Lapayowker, P.A. is an
aviation attorney and aviation transaction lawyer, focusing on airplane and jet transactions.
To learn more, visit Businessaviationcounsel.com.

February 22, 2011 in Business, Legal Articles by jferris

Religious Discrimination Becoming a Potential Landmine

Reverse discrimination is becoming a potential landmine of legal issues. Laws to protect the rights of minorities may result in discrimination against others.

In a rather unusual case reported in the media, a relationship counselor was dismissed when he said he would not provide sex therapy for a homosexual couple. The counselor felt that the Bible’s point of view about homosexuality made it impossible for him to give the two advice. His co-workers deemed that unacceptable and he was fired.

The man took his case to court and stated he was a victim of religious discrimination and had been fired for refusing to act against his beliefs. His claim was not successful and the courts referred to it as irrational and capricious. Pundits watching this case feel that situations like this have the potential to create an imbalance in laws set up to protect the rights of minorities with the end result that those with religious beliefs are discriminated against.

Some regard this ruling as a bellwether signaling the death of religious literacy, because instead of protecting minorities from genuine discrimination, the courts may have created an imbalance in favor of minorities. In this particular case, many feel that the courts are not particularly cognizant of how vital and important religious teachings and convictions are to some individuals, despite the common mores of the rest of society.

Where will this rather new development lead? It is an interesting question and one whose answers likely lies in what society versus the courts feel is relevant and represents reality. The reality of today is that most people accept the fact that gay couples are a part of society. For those that do not accept this precept, their journey is a different one with no clear destination in mind. Reverse discrimination is an issue just beginning to poke its head up in various court cases. How the courts deal with it will be another question.

If you feel you have been a victim of religious discrimination in a similar matter or another form, do not hesitate to contact an experienced Chicago employment lawyer. Discrimination is a very difficult and diverse area of the law and you need to know if your particular situation may be handled in court or through negotiations. Without the assistance of a skilled Chicago employment lawyer, cases like this are difficult to resolve.

Timothy Coffey is a Chicago employment lawyer and principal attorney for The Coffey Law Office, P. C., an employment litigation firm dedicated to representing employees in the workplace. To learn more or to contact a Chicago employment attorney, visit Employmentlawcounsel.com.

February 22, 2011 in Business, Legal Articles by jferris

Big Rig Load Shift May Have Caused Woman’s Death by Crushing

Truth is stranger than fiction. This bizarre crush death left a family in shock and wondering how to cope with the loss of their loved one.

This is perhaps one of the more bizarre cases ever reported, as there seems to be no readily available explanation for what happened. It Is a most troubling case and the family seeking compensation in this wrongful death case has a boatload of unanswered questions about what went wrong.

Fifty-eight year old Penny Marlow of Duluth was crushed to death in her Kia Rio after she was involved in a wreck with a semi that rolled over onto her car. No one is sure how the truck turned over on its side, other than it looked like it happened when the truck was trying to make a left hand turn onto a street. The semi was fully loaded with coal, but the trailer did not have a tarp over the top.

The bizarre aspect of this collision is that it took place at a speed of 30 mph and there was no real reason for the truck to have rolled over, although the police report indicates that the load of coal may have shifted in the trailer. The other question is how the load shifted, unless the trucker was trying to take some evasive action to avoid the Kia Rio. The semi driver was unharmed in the wreck. No citations were issued and a further investigation was to be launched.

Marlow’s family may never really know what happened to cause the truck to shift and roll, but they know for a fact that her death has left a huge hole in their lives. They may well be in a financial bind as a result of her death and not know how to begin to pay the bills relating to her accident, funeral and burial. They might need help right away to be able to pay the extra financial obligations they will be facing.

One alternative for the family would be to contact a litigation funding company and ask about applying for an emergency lawsuit cash advance; an advance on the award or settlement they are expected to get at trial or from the insurance company. This is not hard to do. In fact, the family only needs to either call the legal funding company or fill out an application for pre-settlement funding on the lawsuit loan website.

Once the case has received approval, the funds are sent to the plaintiff’s bank, where the victim then uses them to pay medical and other expenses related to the accident. They also use this money to pay their usual bills, like mortgage, car or truck payments, tuition or rent. The idea is to get them caught up financially, so they do not have to take chump change from an insurance company.

With pre-settlement funding in the bank, the plaintiffs have the choice to either accept or decline a lowball settlement offer. Most decline, as a jury award tends to be higher than anything an insurance company will cough up.

Daren Monroe writes for Litigation Funding Corp. To learn more about lawsuit funding and litigation funding, visit Litigationfundingcorp.com.

February 21, 2011 in Business, Legal Articles by jferris

Bad Credit History is a New Form of Discrimination

A company is not allowed to refuse to hire Latinos or blacks because of a criminal record or bad credit.

In a recent move to even greater equity in the workplace, the Equal Employment Opportunity Commission (EEOC) is warning companies that they may not use credit history information as criteria for hiring or firing. This comes about as a result of the EEOC suing Kaplan Higher Education Corp. for doing precisely that – using credit history information that had a major “disparate impact on black job applicants.”

Another of the EEOCs lawsuits is against Freeman Cos., sued for using criminal records and credit checks to screen applicants for their national events and exhibition marketing company. The EEOC is bound and determined to erase racism and “colorism” from the workplace. And if the statistics are any indication, they have their work cut out for them, as the number of workplace discrimination suits shot up to 99,922 in 2010.

These particular lawsuits are the tip of the iceberg in an initiative to dissolve what is referred to as arbitrary barriers for minorities to find work. Is this controversial? Yes, because the lack definition of what has an adverse effect on blacks and other minorities has always been a hot button and the focal point of disputes. It is one facet of discrimination law that troubles many Chicago employment lawyers and the courts.

The EEOC indicates that things such as background checks may wrongly exclude a large majority of minority job applicants. On the other side of the fence, many employment lawyers feel that if the criteria for hiring is not racially motivated and it is used for everyone who applies for a job, then it is not racially discriminatory. Put another way, it is not anyone else’s business (i.e. the government) to try and second-guess hiring practices unless the job applicants are being treated differently because of their race.

Of interest is that the Supreme Court has not viewed the “disparate impact” with any degree of favor over the years. In fact, two years ago, they ruled that the City of New Haven had discriminated against white firefighters who had high scores when it chucked out a promotion test because it had an adverse impact on black firefighters. Unfortunately, the court did not see fit at the time to clarify the issue any further.

Such hiring practices are not inherently illegal even if they do happen to have a negative impact on minorities. But, having said that, the employer must be able to demonstrate that the hiring criteria is necessary for the job being applied for in the first place; something that is not always easy to do.

If you happen to be facing a situation that you feel is adversely affecting your ability to get a job, then you need to speak to a highly qualified Chicago employment lawyer. You need to find out your rights, how the law as it exists applies to your case and what your options are in dealing with your situation.

Timothy Coffey is a Chicago employment lawyer and principal attorney for The Coffey Law Office, P. C., an employment litigation firm dedicated to representing employees in the workplace. To learn more or to contact a Chicago employment attorney, visit Employmentlawcounsel.com.

February 21, 2011 in Business, Legal Articles by jferris

Worker Impaled On The Job Survives With Serious Injuries

The unexpected can and does happen at work when you least expect it. Luckily, this man survived his shocking injury.

Some days it does not pay to go to work. This case is a prime example of that. The worker in this instance was on the job at Grimmway Farms in San Joaquin Valley in California, when the weirdest thing happened at the processing plant.

The worker in question was operating a forklift and for some reason, crashed into a metal gate. The resulting accident drove a metal pipe right through his torso. It seems the gate that he crashed into was a safety gate that had been left open.

EMS crews and responding firefighters had the grim task of sawing the metal pipe six to eight inches away from the man’s body; a gruesome task, completed while the man was still fully conscious. When the bar had been cut, the Jaws of Life and other hydraulic equipment was used to cut away the steering column, seat and controls to remove the victim from the truck. The worker was then airlifted to the nearest medical facility.

There is no doubt the U.S. Occupational Safety and Health Administration (OSHA) will want to know how this accident happened in the first place.

This man would definitely need to speak to a personal injury lawyer to find out what he needed to do to file a claim for compensation for his injuries. Having a metal pipe driven through your torso is a serious and potentially life-altering injury. The man will likely be unable to work for a long time. He will need income to help him recover and get on with his life. He will need an emergency lawsuit loan from a litigation funding company.

All he has to do to access pre-settlement funding is to apply online to the litigation funding company or call them directly and find out what he needs to know. The plaintiff will need to provide case details in order for the legal finance company to assess his case. Once they have determined the case is likely to win in court, the lawsuit cash advance is sent to the plaintiff posthaste.

Litigation funding typically arrives within 24 to 48 hours. When it hits the plaintiff’s bank, they can immediately take the funds out and pay their medical bills and other outstanding expenses. This legal funding loan is designed to help financially desperate plaintiffs to get back on their feet while they wait for their case to go to trial. Because they have pre-settlement funding in the bank, they are not obligated to take settlement offers from an insurance company. It is a good deal for plaintiffs and should be examined as a viable alternative when you have been injured as the result of someone else’s negligence.

Daren Monroe writes for Litigation Funding Corp. To learn more about lawsuit funding and litigation funding, visit Litigationfundingcorp.com.

February 12, 2011 in Business, Legal Articles by jferris

Barbie Versus Bratz Highlights the Importance of Protecting Trade Secrets

All eyes will be on Barbie versus the Bratz dolls when Mattel v MGA begins a new, three-to-four month federal courtroom battle in Santa Ana, Calif.

Mattel alleges that some of their employees were hired by MGA and encouraged to download Mattel documents before leaving their position to go to the competitor. Mattel also claims that several of their employees who were wooed by MGA helped start MGA’s Mexico division using safeguarded Mattel information and expertise.

Protecting a business’ trade secrets is essential no matter how big or small the company may be. Successful companies have proprietary techniques and information that oftentimes their competitors do not have. Trade secrets include business and marketing plans, pricing and customer lists, and research and development. Every business should have a plan to protect their trade secrets from theft or inappropriate disclosure, otherwise a business can compromise its long-term success and profits.

Business lawyers can help create confidentiality and non-disclosure agreements for employees, and any individual, investor or vendor that might deal with a business’ proprietary information should be required to sign them. It is also crucial to have rules for limiting access to proprietary information and documents. Make sure only those employees who must receive certain information have access to it, and secure these documents in locked file cabinets and/or password-protected online files, and mark them as confidential. Limiting photocopying and shredding documents after use can also help. And for visitors to a corporate headquarters, restrict their ability to bring in video cameras and recording devices, even if it means restricting them bringing in cell phones that have all these recording capabilities.

Businesses should also be wary when an employee quits his or her job. Supervision during an employee departures can ensure they are not removing proprietary info, and all passwords should be changed so they cannot log in at a later date to access high-level documents.

A good business attorney will create very specific nondisclosure agreements, ensure inventions and products stay the ownership of the company and protect the rights of the company without infringing on the rights of the employee. Businesses that are proactive will help prevent trade secrets from falling into the competitor’s hands.

Anthony Spotora is a Los Angeles entertainment lawyer and Los Angeles business attorney. To learn more, visit Spotoralaw.com.

February 11, 2011 in Business, Legal Articles by jferris

Business Savvy Meets the Law When Starting a Record Label in the New Media Age

In the age of new media, record labels and artists have many opportunities to make money, but also must be cautious about downloading royalties, copyright licensing, and protecting their income streams. High-profile artists such as Eminem, Jay-Z, and Madonna and their labels must constantly watch over iTunes downloads, YouTube streams, Wii games, and other emerging digital players to see if their rights are being violated and profits diminished.

New technologies are created so often, and with that new providers of entertainment products and content are jockeying to attract consumers. Whether you are starting a record label or are an established music heavyweight, it is crucial to have a lawyer that knows how to guide you through the new media and music laws.

Entertainment attorneys will structure, negotiate and update contracts and agreements for Internet and new media outlets. As advertisers and marketers look to deliver information and entertainment to the masses, lawyers will counsel on finance, production, licensing, and the sale of intellectual property to be broadcasted on the Internet, cell phones and wireless devices, interactive and video game platforms and other digital channels.

Product placement and brand integration ventures in feature films, television, and new media are also areas where a lawyer can ensure both the business and creative rights of the label and artist are upheld. Many labels are also creating “360 deals” to increase revenue streams through tours, concerts, merchandising and new media partnerships.

Record labels realize the importance of YouTube, for example, to virally show off their artists. It is hard to control postings of copyrighted materials by fans, so labels work with their lawyers to negotiate licensing terms for their songs and videos that appear on the popular website. And with increasing sales of digital music and fewer CD sales, downloading royalties can rack up to millions of dollars in revenue for artists and labels.

Any size record label can benefit from a savvy entertainment lawyer to establish the label name, website presence and connect them with start-up capital opportunities and marketing professionals. From business plans to product launches and artist contracts, they can buffer the label and artist from the cutthroat music industry.

For those that are starting record labels, lawyers will give you vital advice to build the record label of your dreams. Armed with an excellent entertainment lawyer, a record label can last longer and protect their image and creative brilliance.

The Law Offices of Spotora & Associates has decades of experience representing musicians and record labels in Los Angeles, Southern California and the world. They have worked with some of the biggest talent in the industry and have a hands-on approach to give their clients the utmost in individualized attention.

Anthony Spotora is a Los Angeles entertainment lawyer and Los Angeles business attorney. To learn more, visit Spotoralaw.com.

February 9, 2011 in Business, Legal Articles by jferris

Piercing the Corporate Veil via the Alter Ego Theory Can Devastate Shareholders

Liability protection is one of the biggest advantages to incorporating a business. When forming a corporation, LLC, or similar entity, a “corporate veil” is formed that creates a separation between the entity and personal shareholder assets. In some instances, courts will pierce this protection and hold shareholders personally liable for the debts and liabilities of the corporation, if the shareholders are found guilty of having misused the corporation as their alter ego.

Many lawsuits apply the legal theory of the “alter ego” wherein the corporate entity is shown to be a sham and/or an alter ego of one or more individuals that have brought on injurious conduct and who essentially utilized the entity as a blanket to hide behind. Oftentimes this allegation comes into play when a corporation’s assets or insurance are inadequate to pay debts or claims. The shareholders can become personally liable.

In California, two requirements must be met to pierce the corporate veil:

1)     Unity of Interests – the shareholders in question must have treated the corporation as their alter ego; and

2)     Inequitable Result – the shareholders sanctioned fraud or injustices.

A step-by-step process is commonly used to examine and ultimately determine if alter ego liability is appropriate in a lawsuit. The landmark case of Associated Vendors Inc. v. Oakland Meat Packing, Co. spells out the steps to determine the severity of their actions:

1) Did the individual(s) act in bad faith?

2) Did the individuals contract with one another with the intent to avoid performance by using a corporate entity to shield against personal liability?

3) Did the individuals divert assets from a corporation by or to a stockholder, other person, or entity to the detriment of creditors?

4) Is the corporation dominated by a few key individuals?

5) Is the same office or business location used by the individuals and corporation?

6) Did the individuals and the corporation employ the same attorney?

7) Did the individuals use the entity to procure labor, services and merchandise for another person or entity?

Did the individuals fail to adequately capitalize the corporation?

9) Did the individuals fail to maintain minutes or adequate corporate records?

10) Will there be an inequitable result if the court fails to pierce?

A plaintiff has the burden of establishing alter-ego liability. Courts do not typically make a distinction between different forms of corporations, whether they are non-profit or for-profit, so alter-ego liability is evaluated equally.

If a corporation is properly created and maintained, shareholders will not be liable for corporate debts or exposed to lawsuits. Shareholders must uphold corporate formalities and avoid any misuse of corporate funds, property and means of manipulation.

The keys to making sure an entity stays separate from its shareholders are:

1) Documentation and Formalities: Ensure that all letterhead, business cards, and corporate signs include the words “Inc.” or “Incorporated”, for example. Shareholders who sign contracts or documents should sign them in a corporate capacity indicating their corporate position. Create by-laws, issue stock, maintain corporate minutes, have separate account books, file annual reports, and have regular board meetings with all directors.

2)  Avoid Co-mingling: Never co-mingle corporate assets with those of the shareholders. Corporations should have their own separate bank account. If you borrow from or lend to the corporation, record an appropriate resolution, sign a promissory note, charge a fair market rate of interest, and make regular payments.

3) Capitalization: Capitalize the corporation sufficiently and purchase adequate liability insurance.

4) Employment Agreements: Establish one between you and the corporation.

5) Multiple Corporations: Avoid identical stock ownership of several corporations along with similar officers and directors. Use different business addresses, telephone numbers and employees.

This valuable advice is critical to minimize a corporation’s exposure to litigation and help them manage their operations. Small and big companies need to understand the importance of having a lawyer to help them with increasing complexities in today’s business environment.

The Law Offices of Spotora & Associates has decades of experience for both businesses and the shareholders that run them. Their services range from counseling individual and corporate clients domestically and internationally, to assisting in business management and maintaining corporate records.

Anthony Spotora is a Los Angeles entertainment lawyer and Los Angeles business attorney. To learn more, visit Spotoralaw.com.

February 8, 2011 in Business, Legal Articles by jferris

Reality TV Contracts Are Full of Complex Stipulations

Reality television is big business and for many aspiring stars, a chance to make it in the entertainment industry. But before the cameras start rolling, an important part of the process is the negotiation and hopeful execution of the contract that will make the reality show, a reality. Most contracts ask individuals to sign away their privacy rights, have stiff confidentiality agreements and may further include defamation waivers.

The contract is the production company and network’s way of managing the value of a potential celebrity and controlling most of the creative and business elements of the show. If the “artist” becomes a star, the contract will spell out what kind of money the production company and network will gain for future shows and licensing. Many reality show contracts are so ironclad, however, that they can portray your image in any way chosen by the producers, throughout various media. Oftentimes, by signing the various waivers accompanying the contract, cast members agree not to sue if something happens to them physically or emotionally.

When you agree to this, you are allowing a show to portray you in any way, even if it is unfavorable. It is important to have a good lawyer review the contract first to make sure your rights and safety are upheld.

Be very wary of any contracts that require upfront payment or minimal or contingent compensation. Reality TV participants must give their consent before a show can use footage of them, as most shows want rights for usage in perpetuity or will want to sell it to someone else in the future. Most contracts are all-encompassing as oftentimes scenes are still in development after the cameras start shooting. The fine print will discuss the potential of bodily harm, fights, sexually transmitted diseases and emotional distress.

These shows will purposefully embarrass or humiliate you and, sometimes, they will even provoke violence, but so many people want to go on them because they think it will be their big break into stardom. If you are not asked for consent, you need to talk to an attorney immediately to safeguard your rights and privacy.

Many contracts also have hefty penalties should a cast member leak the winner or conclusion of the show. It is not uncommon to have a fine between $5 and $10 million in the confidentiality agreement.

The Law Offices of Spotora & Associates specializes in negotiating and drafting contracts, securing copyrights and trademarks, and litigating and protecting entertainment clients’ rights. Many celebrities, upcoming TV stars, studios, agencies, and production houses have sought their expertise and individualized attention.

Reality TV can be a lot of fun, but cast members must take the contract very seriously. It is worth the extra effort to consult an attorney to know what you are getting yourself into.

Anthony Spotora is a Los Angeles entertainment lawyer and Los Angeles business attorney. To learn more, visit Spotoralaw.com.