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So you want to be a business owner? Watch out for the legal bumps.

Especially in the world we live today, with the critical need for specialization, and with the incredible speed at which technology has enabled us to perform many jobs more efficiently, accurately and cost-effectively, many out there are exploring their options for starting their own small business. Whether it is a local coffee shop, a service business such as marketing and SEO, or a clothing manufacturer or retailer, all small businesses owners face certain requirements, obstacles and headaches in their search for small business freedom and success. From conception to preparing a business plan, from securing financing to getting and keeping the business running, the journey of a business owner is fraught with all of

joy, uncertainty, trepidation, disappointment, failure and success. I know this, because I too am a small business owner. But do not just take my word for it. According to this article from lendingtree®, citing labor bureau statistics, and supported by many other studies done, 1 in 5 small businesses fail within one year, 50% fail after 5 years. In order to beat the odds, playing it safe is your best bet, and that means doing what many other business owners won't; seek proper help, when needed.

This 1st in a series of articles is designed to alert business owners to potential legal issues they may face as they start and run their business, and to help them understand the timing, severity and scope of those issues. In addition, the posts will educate business owners on how the services of an attorney can help meet their legal needs. Read more below for more information on the critical areas where a business can misstep and create problems for itself later on. Each subsequent article in this series will be based on each of the categories listed below.

Two owners of a coffee shop behind the counter preparing beverages
Coffee Shop Owners

Business Name

Of course, before you can begin running a business, it needs to exist. For it to exist, it needs a name. Unless you are a sole proprietor and using your own name rather than a DBA, If you really want your business to stand apart from the competition and keep it from infringing another trademark, a name search should be your first priority. At minimum, a basic name clearance search should be performed. For more information on why a business name is important, (and why you should invest in protecting your business name with a trademark) read this article.

Letters L L C with Limited Liability Company written in cursive underneath.
Business Formation

Business Formation

Most business owners, other than sole proprietors, should really consider using the services of an attorney when deciding on and creating a business entity. Many factors should be considered when choosing a business structure. Personal liability, ease of transferring interests, tax treatment, and management structure are some of the factors that should be considered before choosing. A lawyer versed in the intricacies of entity formation can not only help you decide what form is right for you, but can also be of assistance in helping you locate an accountant or tax attorney. Click here for a more detailed review of the pros and cons of each business types.

Business Licensing & Compliance

Depending on the type of business you start, there may be both state and federal compliance issues to attend to. For instance, if you wanted to begin an interstate trucking company hauling cargo or passengers, the business would be required to be registered with the Federal Motor Carrier Safety Administration and must have a USDOT Number. And while the State of Oregon has no general business license, there are many business activities that require special licenses, permits or certifications from state agencies or boards. One such requirement pertains to operate a hair salon or barbershop in Oregon, you would be required to get a Cosmetology Facility license. If you would like to check if your proposed business area has any such requirements in Oregon, find that information here. Also falling under this umbrella may be state or local zoning restrictions that may dictate where your business may operate. An attorney can help you to understand and comply with such regulations, so that your business is in compliance with the law and its' operation continues on, uninterrupted.

Trademark symbol with related words surrounding it in multiple ways.
Trademark Law

Intellectual Property

Many business owners no little about intellectual property (IP) and how it matters to their business. This could be a big mistake. IP can account for 80% or more of the value of a business, especially if it is a tech business or well-know. Even if not that high for your particular business, there are many different types of intellectual property, that if identified and protected properly, could add value to your business. Trademarks, copyrights, patents and trade secrets can be found within your company and potentially exploited through protection mechanisms such as registration and non-disclosure agreements, and through licensing and franchising agreements. In addition, your IP could be used as collateral for a business loan! A lawyer can help guide you on the above considerations as well as guide you in conducting an IP Audit of your business.

Blank licensing agreement on a table with a pen and a legal book next to it.
Licensing Agreement


Probably the first time that business owners seek the help of an attorney is after a contract dispute. Whether you are the aggrieved party, or are on the wrong end of a lawsuit, the strength and content of that contract has already dictated much of the outcome in that dispute. Many business owners believe that any contract will do, or do not agree that spending money to have an attorney review and/or negotiate a contract is cost-effective or even necessary. Contracts are fraught with language that tends to benefit one side or the other, depending on who drafted the contract and whether they were represented by counsel. Words that in common usage may have a inconsequential effect or meaning, when used in a contractual sense, may have have very unintended consequences for the parties and their expectations. In addition, many contracts written without the benefit of counsel's advice are simply vague (leading to misunderstandings and lawsuits) and may even be unenforceable. For 5 good reasons why a lawyer should be reviewing your contracts, read this Forbes® article.


As your company grows and you begin to add employees, a whole myriad of challenges arise. From employee eligibility to payroll and taxes, intellectual property considerations (such as NDA's and others) to codes of conduct or employee handbooks, to employee notifications and terminations, finding an attorney who specializes in employment law will be an invaluable resource. They can keep your business in compliance and out of legal hot water that could be very expensive to rectify.


Obviously there are many more areas where a business could get in trouble or just need the services of a business attorney. Some examples might be website privacy policies and terms and conditions, disputes with suppliers and customers, tax questions and issues, negotiations, business advice and much more. Just remember, an ounce of prevention, is worth a pound of cure. The money you spend on legal counsel early will outweigh the costs it will take an attorney to undue your trouble later. It will also provide you with peace of mind....and more time to do what you do your business!

If you have any questions on this article or would like to consult on a legal issue you may be facing, please feel free to contact us at INTELLEQUITY® at 503-877-0881, or book a free or low-cost consult here! Stay tuned for blog post #2 Legal Issues of Choosing a Business Name. Intellequity is Portland's Business Law attorney!

The law firm is licensed to practice in Oregon. The information provided by this blog post is offered for general information only. It is not intended to be legal advice and does not establish an Attorney-Client relationship between you and this firm. For more detailed information on your particular situation, contact us at 503-877-0881.

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