At Torus Law we value building win-win relationships based on principles and practices that model trust. For example, if we don’t know something we’ll tell you. And we if can’t help you we’ll find someone who can.

For more information or to schedule an appointment to learn how we help clients Dream, Build, Plan and Protect their ideas, strategies and results call 804-368-7397 or visit us at www.toruslaw.com.

One of my favorite restaurants is a little Mexican place in Utah called El Chubasco. I’ve often eaten there twice in a day, and once (it’s true) ate there three times.

It’s always crowded. Sometimes people wait outside, in the cold, even though there are plenty of alternatives within walking distance. So, what’s the secret? Why is it worth a drive and a wait?

No specific reason. The energy of owners Jill and Craig is certainly part of it, but most customers never encounter them. I think it’s the hand-fitted gestalt of thousands of little decisions made by caring management out to make a difference. Usually, when a business like this gets bigger or turns into a chain, marketers make what feel like smart compromises. The MBAs collide with the mystical, and the place gets boring. “Why do we need 14 free salsas when we can get away with six?” or “Perhaps we ought to stop handing out huge tumblers of water for free–our bottled water sales will go up.”

This turns out to be the secret of just about every really successful enterprise. Sure, you can copy one or two or even three of their competitive advantages and unique remarkable attributes, but no, it’s going to be really difficult to recreate the magic of countless little decisions. The scarcity happens because so many businesses don’t care enough or are too scared to invest the energy in so many seemingly meaningless little bits of being extraordinary.

The New York case relates to allegations against former Syracuse basketball assistant Bernie Fine. Apparently two former Syracuse ball boys alleged they were molested by Fine. In response to the allegations head coach Jim Boeheim, as reported on SI.com, quoted an ESPN interview in which Boeheim said, “It is a bunch of a thousand lies that [ ] has told.” Boeheim is also quoted as saying the allegations were about trying to get money. In response to Boeheim’s comments the former ball boys filed a defamation suit against Boeheim and Syracuse University.

What’s to learn from these suits? One of questions to ask is how you would respond in similar circumstances? Both of these cases involve highly charged emotions and issues. Under these circumstances it may be very difficult not to want to express your opinion particularly if you feel justified in doing so. However, in this day and age one thing we  have to remember is what you said five minutes ago could be on You Tube or Facebook in a matter of minutes. Individuals and businesses need to understand the times we live in; they need to exercise restraint and if they feel they have to express themselves they should do so in an environment that affords them protection as privately with an attorney, where the attorney client privilege would prevent even the most inflammatory comments from ever becoming public.

End Note: The phrase Lose Lips Might Sink Ships and Careless Talk Costs Lives were coined during WWI as part of the US war department’s efforts to limit giving useful information to the enemy.

1. Not using a screensaver;

2. Never turning off your computer; Nelson and Simek noted that turning off your computer once a day clears processes that didn’t terminate and applications that got tangled;

3. Always using eight character passwords. Nelson and Simek noted that anyone with any IT sophistication could crack an eight character password. However cracking a 12 character password would take 17 years;

4. Storing passwords on monitors, under keyboards or anywhere else that can be located. Passwords even 12 character ones should be easy to remember;

5. Installing illegal software in violation of copyright laws;

6. Not backing up your data and if you do back-up your data not doing a test restore;

7. Not having a PIN for your smart phone;

8. Depending too much on Outlook’s auto complete function.

For more information about these technology tips see www. lawyersweekly.com or contact Sensei Enterprises, Inc., in Fairfax, Virginia.

For more information about how our team of lawyers and other professionals can help protect and grow your business email me at jc@toruslaw.com or call me at 804-368-7397.

In a recent case a local judge allowed a creditor to pierce a corporation’s veil and sue the corporation’s lone shareholder. The judge allowed the suit against the shareholder noting that annual meetings were not held, separate books were not maintained and the corporation was grossly under capitalized.The creditor obtained a $137,454.00 judgment against the shareholder.

While corporations have to adhere to numerous formalities, LLC formalities are fewer and the consequence of not following them is less significant than failing to follow corporate formalities. And while having fewer formalities should not be the only reason to chose an LLC over a corporation it can be an important consideration depending on one’s personality.

If you’re considering starting a business call us to discuss which entity would better serve you. If you have a business that’s incorporated you should take some time to review if you’re meeting the formalities that apply to corporations.

Torus Law, Dream, Plan, Plan, Protect

JC Cancelleri, 804-368-7397 or jc@totuslaw.com

There are several corporate formalities that one has to perform to maintain the protection that corporations provide against individual liability. Among these requirements is the need to hold an annual meeting and the need to have separate books if you have separate corporations.

A recent Richmond case ACE Electric Co. Inc., v. Advance Technologies Inc., illustrates the consequences of ignoring the corporate requirements. My next post will briefly discuss what happened and will also discuss some additional differences between forming a corporation and an LLC.

There are five factors that must be satisfied to discharge income taxes:
1) the return date for the tax must be more than three years old. For example, the return file date for 2007 taxes was April 15, 2008. To satisfy this condition a bankruptcy petition would have to be filed after April 15, 2011.
2) The return has to be filed more than two years ago; and
3) Any assessment must have occurred more than 240 days before the filing of the bankruptcy petition; and
4) The tax return must not be fraudulent; and
5) The taxpayer must not have been guilty if a willful attempt to defeat or evade the tax.

If all five conditions are satisfied then the income tax would appear to be dischargeable. For example, if you were self-employed in 2007 but didn’t pay any income taxes for that year, if you meet all five conditions as stated above you should be able to discharge those taxes by filing a chapter 7. Of course you first have to be eligible to file a chapter 7. If you are eligible filing a chapter 7 could significantly reduce your tax burden.

To learn more about Torus Law and our commitment to help you grow your business through a process of Planning, Building and Protecting please call me at 804-368-7397 or email me at jc@toruslaw.com

By JC Cancelleri
100 Arbor Oak Drive, Suite 307
Ashland, VA 23005
Phone: 804-368-7397

For example, if I owed 20K and negotiated a 10K settlement the creditor will send me a 1099 for the 10K that it wrote off.  Because the IRS treats write offs as income I am going to have to pay taxes on the 10K the creditor wrote off.  Consequently before negotiating a settlement with any creditor ask your tax adviser what effects it will have on your taxes.  On the other hand consumer debts discharged through the bankruptcy process are not considered income and will not affect your taxes.

For more information about workouts, negotiating with creditors and the bankruptcy process please feel free to contact me. An adviser can help you make informed and often better long-term decisions.

Contact Info
JC Cancelleri
100 Arbor Oak Drive, Suite 307
Ashland, VA 23005
Phone: 804-368-7397
email JC

Part Two

Last week I posted a partial summary of an interview I did with Mindy Flanigan, PHR, a Human Resource Specialist with more than twenty years of experience.  In this article I discuss two of the strategic ways that Mindy brings value to businesses.

One way that Mindy strengthens businesses is by helping them minimize employments law risks.  As noted in my previous post there are numerous federal and state employment laws that businesses have to comply and contend with. As a human resource specialist Mindy helps businesses navigate the mind field of employment laws. For example, last week I referred a businessman to Mindy who called me wanting to know if his company could fire an employee who took an extended medical leave. The company had less than 10 employees.  Although the Family and Medical Leave Act may not apply due to the company’s size, the issue is still a thorny one because other equal employment opportunity laws may need to be considered.  Other  laws that could be implicated by other situations include the Fair Labor Standards Act, the American’s with Disabilities Act (ADA) and the Civil Rights Act of 1964.

Another way that Mindy strengthens businesses is by helping them maximize employee performance, which helps to reduce employment costs. It’s no secret that it can cost thousands of dollars to replace an employee who was transferred or fired due to a mismatch between the employee’s skills and the job’s demands. Mindy’s objective is to help employers hire the best people resulting in a productive work environment. Mindy recently placed a director of land surveying with an employer who after nine months still raves about the placement.

Helping businesses minimize employment risks and maximize employee performance are two of the strategic ways that Mindy helps businesses become more profitable. To learn more about Mindy’s services visit her web site at www.inspiringhr.com. or feel free to call me with your questions.

To learn more about Torus Law and our commitment to help you grow your business through a process of Planning, Building and Protecting please call me at 804-368-7397.

By JC Cancelleri, PC
100 Arbor Oak Drive, Suite 307
Ashland, VA 23005
Phone: 804-368-7397

Like the dental firm most businesses don’t know about the intricacies of the FLSA and don’t know much about the various federal and state laws that they are subject too.  What’s more problematic is that businesses that are too small to hire a full time HR specialist may base their HR practices on incomplete and even mistaken beliefs and information.  One example that Mindy mentioned is the continued practice of classifying employees as independent contractors (IC’s).  While the IRS has a multiple question test to determine if a person is an employee or independent contractor, classifying someone as an employee may be based on as little as having the right to tell the employee what time to be at work and what time to leave work. Misclassifying employees as ICs to avoid paying payroll and other taxes may save you lots of money if you don’t get caught. If you’re caught however, the fines and penalties you pay may significantly affect your bottom line for that quarter and even the year.

In the next article I will discuss the two strategic ways that Mindy brings value to businesses. To learn more about her services visit her web site or email her at mflanigan@inspiringhr.com or call her at 804-822-6383.

To learn more about Torus Law and our commitment to help you grow your business through a processing of Planning, Building and Protecting please call me at 804-368-7397 or visit us at www.torus.law.com.

• Two years of business and personal tax returns;
• Current balance sheet and income statement;
• An accounts receivable report;
• An accounts payable report; and
• The company’s debt schedule.

I also asked the BM what information a business start up had to include in its business plan. Start ups generally need to provide more information than existing businesses including:

• A description of the business;
• A summary of the owner’s business experience;
• The demographics for the business;
• Industry research;
• Three years of projections;
• An opening day balance sheet;
• Two years of tax returns; and
• Two years of personal financial statements.

A start up business may also need to provide collateral for the loan and may need to contribute up to 20% of the amount requested.

I then asked the BM about the most common deficiencies in business plans. The BM identified three:

1. The number one deficiency is unrealistic projections for revenue and net income on an annual basis, due to the fact that the owner didn’t  do the appropriate research and is at a disconnect with where their industry trends are.
2. The second most common deficiency is providing insufficient information about the business and/or lacking a description about what they do as a business. The BM said that existing and prospective owners need to tell their story to the underwriter.
3. A third deficiency, which applies more to start-ups is their lack of experience in the industry and/or having insufficient collateral.  The BM noted that while a business plan needs to include sufficient information he also cautioned against putting too much information into the plan. The BM said the underwriters need to be able to understand the business but putting too much information in the plan could be counterproductive.

Finally the BM said as to business plans that are approved the process takes about two weeks, from the time it receives the application to when it issues a check. The BM noted that if the business is a franchise the process could take an additional ten weeks if the franchise is not already listed with the SBA as an “approved franchise.” And if the loan is over 100k, the process may take up to eight weeks depending on the appraisal of the collateral.

For more information about how our law firm can help you write a business plan as well as help you plan, grow and protect your business, please call me at  804-368-7397.

Contact Info
JC Cancelleri, PC
100 Arbor Oak Drive, Suite 307
Ashland, VA 23005
Phone: 804-368-7397
email JC

A somewhat recent case in Hanover County offers yet another example of a non-compete agreement that was declared to be invalid because it was too broad. The case is Specialty Marketing, Inc. v. Brunson Lawrence.

Lawrence worked as an account representative responsible for sales in North and South Carolina. His non-compete said he could not “own, manage, control, be employed by participate in, or be connected in any manner with the ownership, management, operation, or control, whether directly or indirectly, as an individual on his own account or as a partner, member, joint venture, sole proprietor, officer, director or shareholder of a corporation, firm, association or other entity, of any business competitive with Specialty in areas where Specialty has a market for its business.”

Judge Harris found the non-compete to be ambiguous, overbroad, and unenforceable.

This is another example for employers who use non-competes to draft them using reasonable terms of time, duration and scope. It’s also another example to employees who are asked to sign non-competes about the limitations of signing agreements that are too broad. If you are an employer and you’re contemplating using a non-compete you should ensure that the language in the agreement is consistent with the principles that Virginia’s Supreme Court and various Circuit Courts have established.

Summer Planting

Members of the Retail Merchants Association (RMA) have access to a variety of products and services. These include floral and apparel products and payroll and marketing services just to name a few. This article focuses on the services that RMA members provide and discuses why you should consider using some of them.

As a business adviser and lawyer, life coach and financial mentor I need the services of a variety of businesses to help my firm grow. While it may be counter intuitive this is particularly true during difficult times. Unless you’re planning on retiring or quitting you should be thinking about and planning for the second half of 2009 and the first half of 2010. What are you’re going to do to at least maintain your market share? If you have a bigger vision you may be thinking about how to increase your market share.

I’m determined to increase market share. Consequently and despite the economy I am investing in more education, marketing and search engine optimization programs than ever before. Did I mention I’m doing this despite already being a lawyer, having a PhD and being a certified life coach? Why…..because everyday we’re becoming more of a knowledge based economy. And I simply don’t want to get left behind! In fact I’m determined to become a world class business consultant, life coach and financial mentor.

Consequently during the last month alone I’ve met with several RMA members to learn how they can help me grow my business. I’ve become a client of one member and in the future will likely hire another one that provides administrative services.

I titled this article summer planting. I did so because nothing gets done without having a plan and being intentional. I have to be intentional because being passive will result in a slow but certain death…..on second though it may not be a slow death.

What about my fellow business owners? Do you think web sites, social networks and search engine optimizations service are expenses instead of investments? Or maybe you think they’re fads. You’d likely be wrong on both accounts. I encourage every business owner during the summer to contact at least three professionals to explore how they can help grow your business. If you want to learn more about what I’m doing call me as I’m happy to share ideas.

Author: JC Cancelleri is a business strategist and consultant with John Cancelleri, P.C. JC’s value as a Hanover business professional is augmented by being a lawyer and life coach as well as his educational background; he also has  a PhD in Organizational Leadership.

Contact Info
JC Cancelleri
100 Arbor Oak Drive, Suite 307
Ashland, VA 23005
Phone: 804-368-7397
email JC

As a member of the Retail Merchants Association you have access to members who provide a variety of products and services. These include floral and apparel products and payroll and marketing services just to name a few. This article focuses on the services that RMA members provide and discuses why you should consider using some of them.

As a business advisor and lawyer, life coach and financial counselor I need the services of a variety of businesses to help my firm grow. While it may be counter intuitive this is particularly true during difficult times. Unless you’re planning on retiring or quitting you should be thinking about and planning for the second half of 2009 and the first half of 2010. What are you’re going to do to at least maintain your market share? If you have a bigger vision you may be thinking about how to increase your market share.

I’m determined to increase market share. Consequently and despite the economy I am investing in more education, marketing and search engine optimization programs than ever before. Did I mention I’m doing this despite already being a lawyer, having a PhD and being a certified life coach? Why…..because everyday we’re becoming more of a knowledge based economy. And I simply don’t want to get left behind! In fact I’m determined to become a world class business consultant, life coach and financial counselor.

Consequently during the last month alone I’ve met with several RMA members to learn how they can help me grow my business. I’ve become a client of one member and in the future will likely hire another RMA member that provides administrative services.

I titled this article intentional fall planting. I did so because nothing gets done without having a plan and being intentional. I have to be intentional because being passive will result in a slow but certain death…..on second though it may not be a slow death.

What about my fellow RMA members? Do you think web sites, social networks and search engine optimizations services are expenses instead of investments? Or maybe you think they’re fads. You’d likely be wrong on both accounts. I would encourage every RMA member during the summer to contact at least three members to explore how they can help grow your business. If you want to learn more about what I’m doing call me. While I’m just getting started I’d be happy to share ideas.

Author: JC Cancelleri is a business strategist and consultant with John Cancelleri, P.C. JC’s value as a business professional is augmented by being a lawyer, life coach and by having a PhD in Organizational Leadership. You can reach him at 804-368-7397 or email JC.