Legal Question in Business Law in California

Business startup: questions

I'm starting a home-based business (on a shoestring budget) to sell video game software via the internet. In the meantime I'm keeping my day job.

What legal issues should I be aware of? This is the first time I've started a business, and I'm trying to cover all the bases.

Also, will e-mail invoices for my customers be sufficient, or must I mail them?

What I've done so far:

- sent in a business application as a sole proprietorship, using my last name (My_Last_Name Enterprises) to avoid a Fictitious Name Statement and needing to register a trademark with the USPTO.

- focusing on video games and DVDs to minimize liability issues. I have no general liability insurance but will switch to an LLC once business has been proven to be profitable.

- My house is zoned properly with the county for this type of home business.

- Will set up a business bank account once my business license is approved, and also get a resellers permit. Will also set up a PayPal account to accept VISA cards.

Thanks.


Asked on 1/24/03, 6:57 pm

3 Answers from Attorneys
Jeffrey D. Olster Russakow, Ryan & Johnson

Re: Business startup: questions

It is virtually impossible to try to address the pandora's box of concerns that confront a new business, even a small one like yours.

I would recommend reviewing any number of books by Nolo Press (the publisher of books written by attorneys for non-attorneys) relating to running a small business in California (e.g., The Small Business Start-Up Kit for California or the Legal Guide for Starting & Running a Small Business in CA).

After you read one of those publications, you'll have a better overview of the numerous legal, accounting, tax, marketing and cost issues that you face.

And, of course, there really is no substitute for consulting with an attorney.

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Answered on 1/24/03, 7:46 pm
Timothy J. Walton Internet Attorney

Re: Business startup: questions

It sounds like you are off to a good start. I can give a few more helpful pointers, but to really cover all your bases, you would have to retain my firm to advise you.

There are specific laws that come into play when you accept credit card payment over web sites. Take a close look at California Business and Professions Code section 17538, for instance.

If you can afford to hire an attorney to help you with a web site disclaimer (TOS) and/or privacy policy, you would be well served. Also, consider whether you need to register for safe harbor under the Digital Millenium Copyright Act. It is easy, inexpensive, and very necessary if you will be allowing people to post things to your web site.

Finally, seriously consider business insurance. It is a nice way to be able to sleep at night before you incorporate or form an LLC.

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Answered on 1/24/03, 7:46 pm
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Business startup: questions

The previous advice is all very good. I would add that you should carefully ascertain that you have the right to offer and resell any software you handle, so that no grey market, licesnsing or piracy issues can arise between you and the owner of the rights to the software or, for that matter, between you and a customer.

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Answered on 1/27/03, 1:15 pm


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