Guzman Law Group Featured in Southbay Magazine's Finance and Wealth Management Profile.
click image to enlarge
Guzman Law Group Featured in Southbay Magazine's Finance and Wealth Management Profile.
click image to enlarge
In daily life today, most of us put our electronic “John Hancock” on the screen every day, whether at the grocery store, drug store or other businesses. We’re used to it as a perfectly valid way to seal- the-deal for routine retail transactions.
But what about other forms of documents, such as business contracts or wills and trust? Are electronic (no ink, no paper) signatures valid?
The answer is MAYBE.
For more than ten years, the US has been a signator to The Electronic Signatures in Global and National Commerce Act (ESIGNA) which makes e-signatures just as valid as the ‘wet signatures’ on paper. “E-signatures” come in many forms, such as: (1) typing a signature into a space as directed on a form; (2) copying and pasting a scanned versions of the signer’s name; (3) using one of the cryptographic technologies available that scrambles information of the sender and allows the receiver to unscramble; or (4) clicking that ubiquitous, “I ACCEPT” button before software is enabled.
So, the ESIGNA allows business to proceed efficiently with the foregoing methods of “e-signatures.”
But some documents still MUST be signed the old-fashioned way in order to be valid. What is “old fashioned?” Using a pen and signing your name on piece of paper. These types of documents include:
You’ll notice that the above list has a common thread – all the types of documents mentioned pertain to personal, health and safety issues. And even if you do have that original document, whether you need to provide a copy of that original “wet signature” document for a transaction here or abroad (from filing a deed with the county record or applying for a foreign tax subsidy) will depend on a number of factors, including the intent of the parties.
In today’s marketplace for routine business transactions between private parties, contracts often have a clause that provides: A facsimile copy and signature or electronic signature shall be deemed an original for all purposes herein.
People routinely sign contracts, scan them into their computer and send those scanned signature pages around the globe for counter- signature with the parties honoring the scanned documents as originals. Keep in mind, however, that you should consult with your lawyer to make sure that your particular document has been properly executed and maybe even notarized or given an “Apostile” status as required for some purposes internationally.
The television industry was abuzz last week when ExxonMobil, one of the most successful oil companies in the world, filed a lawsuit against another world-class conglomerate, Twentieth Century Fox Television. Why would a U.S. television network be the target of a lawsuit from a company that brings us gasoline at the local pump?
The answer lies in two crossed letters where "XXes” mark the spot!
Take a look at the two logos below. Exxon has been using its double-x symbol for decades (even before its association with Mobil). Fox just started the edgy FXX network (an offshoot of the FX Network) in the last year and ExxonMobil claims that "FXX," is infringing on its US registered trademark by causing confusion in the marketplace.
The first question you might ask is, "What is a 'trademark'?
A "trademark" is a word or symbol that identifies the source of goods or services. Think of it this way: when you see the iconic “Coca-Cola” symbol, you know that the drink inside the can comes from the Coca-Cola Company and the liquid inside is the drink we have all come to associate with that mark. “Coca-Cola” is a U.S. Registered Trademark of the Coca-Cola company.
The United States is not the only country that affords trademarks protection under its laws. Trademarks are protected by laws throughout the world when they are legally registered and/or established by continuous use in the marketplace. The highest form of trademark protection in the U.S. is obtained through a registration process with the US Patent and Trademark Office (USPTO). The 'Exxon' trademark has been registered with the USPTO and in use since 1971.
So do you think that the FXX Network’s mark causes confusion in the marketplace with ExxonMobil?
Take closer look --
What is your reaction?
A spokesperson for the network told Bloomberg News that they are confident that "viewers won't tune into FXX looking for gas or motor oil and drivers won't pull up to an Exxon pump station expecting to get It's Always Sunny in Philadelphia."
Quips aside, we won't know the answer to this question right now, but the dispute between two titans points out some things that every business person should know.
First of all, branding your product or service is serious business. The task requires knowledge of the law and careful planning. It can be difficult to create a new name that hasn't already been taken or that won’t infringe upon an existing mark.
For example, all of us do-it-yourself Californians know that the 'Home Depot' brand is identified by its name and color (bright orange). If someone started a business called ‘Home Center’ and branded it with the same type and color as Home Depot, would that be infringement? Would you be confused as to the ownership of the business?
In simple terms, if a mark is confusingly similar and a reasonable consumer would think there is a commonality of ownership, that's not permissible under the law.
So what should we conclude as the titans of industry battle it out in the courtroom (or settle in the boardroom)? It is very important to research any proposed mark before it is put into use with a business to avoid the headaches (and legal costs) that will follow if you unknowingly create confusion in the marketplace. Or as the age-old adage goes, “An ounce of prevention is worth a pound of cure!”
Crowd funding is hot! It has taken form in recent years, allowing anyone with a project, cause, or company to secure donations online in exchange for various gifts, or simply just for the sake of donating. Typically, sites like Kickerstarter, Indiegogo and Rockethub serve as conduits for the campaigns and their gift givers.
One recent example is Veronica Mars, the defunct TV series now poised to be a motion picture thanks to its wildly successful crowd funding campaign. Veronica Mars' Rob Thomas spearheaded the capital raising campaign via Kickstarter, attracting 91,585 backers donating over $5.7 million dollars! Not bad for what typically turns out to be a thirty day time frame. While not all campaigns are successful, the amount of money raised by this budding industry has caught the attention of Congress.
In April of 2012, the President signed the JOBS ACT and TITLE III of that Act permits equity crowdfunding: selling shares or units in your company in exchange for cash. Until the SEC issues rules as required by TITLE III of the Act, it's still illegal to offer equity in exchange for investments online; however, once that happens, we will see a whole new industry blossom. Entrepreneurs and other business people will be able to use third party intermediaries to conduct campaigns to raise capital online. There are parameters upon how it all works-the devil is in the details, but it's expected that sometime this year those rules should be in place to make this a reality.
Perhaps Veronica Mars could have set up a campaign for equity crowd funding, seeking investment in its production company. The cap per twelve month period for the production company would be $1 million; and the investors would have a stake in the company, but perhaps if you have a well known brand like Veronica Mars, you might want to stick to the donative model that they used (they raised more money). If you are the "next" Veronica Mars and don't yet have brand recognition or a proven fan/customer base, perhaps you might want to use the equity model (once legalized) so as to incentivize investors that even though you can only raise $1 million per year, investors may possibly make more on a return (the donative concept doesn't allow any return-it's just a gift).
Time will tell how this space evolves, but one thing is for sure, it will be a show worth watching!
Imagine that you need to raise $100,000 for your business. With limited options, you seek the internet as source of funds. You place a campaign on a third party website that allows you to reach infinite amounts of people, who may want to donate to your cause in exchange for different types of creative gifts you offer in return. A California based company, Pebble Technology did just that and surpassed its $100k goal to set an incredible record of securing over $10 million dollars in just thirty days! Granted, this is probably the highest campaign to date; however, it begs the questions: How did they do it and what are the rules of the game?
Well, as most entrepreneurs know, access to capital has been increasingly difficult for small businesses, which in turn affects jobs, tax revenues, and a host of related areas. Fortunately, on April 5, 2012, the Jumpstart Our Business Startups Act (JOBS) was signed into law, allowing crowd funding to exist as a way to infuse much needed capital into the business sector. Crowd funding is a way for the "crowds" to invest online in ventures of their choosing in exchange for equity. Currently this does not comport with securities laws; however, the Securities and Exchange Commission (SEC) is actively setting forth rules that implement the JOBS Act provisions on crowd funding, so that the balance between access to capital and reduction/prevention of fraud can effectively be balanced. One of the key issues relates to third party websites that serve as a conduit between the entrepreneur and the investor. These portals are the subject of debate in terms of how their role will be shaped to effectuate that balance of providing access to capital and protecting from investor fraud. While sites currently exist under the donative (gift) model, where causes, business, and various projects have sought funds in exchange for gifts, this area of business and law is about to propel to new levels, particularly once the SEC and FINRA (Financial Industry Regulatory Authority) rules are established.
A wise man once said, “the only two things certain in life are death and taxes.” Although we have very little control over when the first occurs, many of us go to great lengths to try to minimize the “ouch” factor of the second. When my parents turned 70, they felt the 3,000 square foot home they lived in for over 30 years was way too much for them. They knew they could sell their home for a lot of money and buy a smaller home very easily. However, my parents were worried about paying a much higher annual property tax bill year after year, since they believed that their new property tax would be based on the price they paid for another home. Luckily, I found two constitutional amendments passed by California voters that provide property tax relief if you are 55 years and older. If you live in a “principal residence” in California for at least 5 years, are 55 years or older, buy a replacement property of “equal or similar value” within 2 years of the sale of your principal residence, and timely file a form BOE-60-AH with the County Assessor’s Office you may be able to transfer the tax basis from the home you sell to your new home. There are certain conditions that must be met to be eligible. My parents sold their home and bought a newer smaller home, with less maintenance, for about the same price. As a bonus, they were able to transfer the property tax base of $3,000 a year from the home they sold to their new home, saving them approximately $7,000 per year. Without the exemption, my parents’ property taxes would have increased to approximately $10,000 per year.
It’s been said, “It is better to give then to receive.” I think we can all agree it is much better to receive without worrying about paying taxes. Under current federal law, most individuals can receive annual gifts of up to $13,000 without being subjected to a federal gift tax. This amount is set to increase to $14,000 in 2013. While many may know about the $13,000 gift-tax exclusion amount, many may not know that there are two exceptions that provide for greater gifting opportunities without taxation. One is when the gift is for tuition and the other is when the gift is for medical expenses. Any amount paid for someone else’s tuition directly to a “qualifying” educational institution is excluded from the gift tax calculation. “Qualifying” educational organizations include those where their primary function is formal instruction. The organization must maintain a regular faculty and curriculum with students that attend where the educational activities are conducted. Also, if the organization has non-educational activities, these must be incidental to the educational programs. A comprehensive definition of “qualified” medical expenses can be found in Internal Revenue Code Section 213, but includes payments for medical insurance and long-term care services such as cost of nursing homes or assisted living facilities, if provided by a licensed health care provider. However, it should be noted that “qualified” medical expenses do not include cosmetic surgery, unless to correct a birth defect or disfigurement.
*This does not constitute tax or legal advise. Please contact your tax professional to make sure any such "gifts" qualify.
We are often asked by clients “How should I take Title to My Home?” It is important to make sure you have titled your home and any other real property correctly to insure that your real property passes to your heirs. There are 3 common ways people hold title to their homes:
Joint tenancy: If real property is held in a joint tenancy, the owner who dies first does not control what happens to the property after his death. A house will pass to the surviving joint tenant outright and the surviving joint tenant has discretion and control to leave the asset to whoever she wants. And if the property is in the surviving joint tenant’s individual name at the time of her death, the property will need to go through probate before it is finally distributed. Further, under current law, the surviving joint tenant only receives a one-half step-up in basis on the property and may end up paying capital gain on one-half of the property after the first joint tenant’s death.
Community Property with Rights of Survivorship: Holding title as community property with rights of survivorship will take care of the capital gains issue. However, like a joint tenancy property, he who dies last wins! In other words, the property will pass outright to the surviving spouse, who can then distribute the property as she sees fit and may disregard the deceased spouse’s wishes. Further, if the property is still in the surviving spouse’s name on her death, then the property will need to be probated.
Revocable Living Trust: Property titled in a revocable living trust will avoid the probate process. Further, both spouses will have input into how the property passes. Finally, if the transfer of the property to the Trust is done correctly, the surviving spouse will avoid paying capital gains on sale of the property.