Ep 19: Capital One, What’s in Your Home

February 24, 2014

Nasir and Matt start the show off discussing Facebook’s newest acquisition (WhatsApp), how Capital One’s credit card policy allows entry into consumer’s homes, the importance of new top level domains to small businesses, and how to not respond to a (fake)employee quitting. They also answer questions concerning about hiring a minor, what expense you can deduct before incorporating, and the legal implications of using a customer’s logo without its consent.

Full Podcast Transcript

NASIR: This is Nasir Pasha.
Welcome to Legally Sound.

MATT: And this is Matt Staub.

NASIR: I know, I threw you off. I usually say, “This is Legally Sound,” and then, “My name’s Nasir Pasha.”

MATT: You switched the order and you didn’t even say the full name of the podcast.

NASIR: Oh, yeah, that’s true. This is Legally Sound Smart Business – also known, in short, Legally Sound.

MATT: Glad you clarified there.

NASIR: I thought you were going to finish the other half. I’m the Legally Sound part, you’re the Smart Business.

MATT: We don’t need to get to the point where we finish each other’s sentences like that.

NASIR: Sentences.

MATT: All right. Let’s jump into it.
This was a pretty big story this week. There’s a lot of news about it.
Facebook is buying this thing called WhatsApp for 19 billion dollars and I think a huge chunk of that is cash and there’s some stock. I mean, I wasn’t familiar with WhatsApp until you actually introduced me to it. We use it pretty much every day. It’s pretty good technology. I mean, this is just really interesting for a few reasons. One, this is a lot of money. This is a pretty small company in terms of size. I think it had 15 employees.

NASIR: It’s small and it’s new. It’s only a few years old, right?

MATT: Yeah, it’s still relatively new. It’s still really small. I don’t think they’re making a ton of money, if any, right now.

NASIR: They’re making money, but nowhere close to 16 billion dollars. I think it’s a dollar per year per user and I know their user base is in the millions. It’s definitely not 16 billion users because that would be more than what’s on the earth. Obviously, there’s a multiplier here.
Honestly, when I first saw this, I’m a heavy user. I use it with my family. I use it for TFL. It’s just a good way to have groups and share whatever. I don’t know. I was a little put off that Facebook is now integrating themselves in there. I think they’ve said that they’re not necessarily going to change it too much or let it independently grow and operate and retain its brand. I don’t know. It put me off a little bit.

MATT: I forgot that I did pay a dollar for when I bought it. I completely forgot about that. That is how they make their money. This is pretty interesting because I don’t use Facebook Messenger, but I know it exists. I guess they just like what WhatsApp had in place a lot more than their own messaging service because I think they’re competitors in a sense. But another thing here, I guess, what was a reason they did this possibly, what people are saying was international usage. Apparently, primarily in Europe, there’s a very high usage rate of WhatsApp and it’s not the same in the US. Maybe there might be more. I don’t remember if there’s more Facebook messaging users or what it is, but it’s extremely high level of WhatsApp users in Europe and other countries outside of the US. That could be a play that they’re trying to do here.

NASIR: Yeah, exactly. I think the international messaging is definitely kind of lost in the Facebook world. I’m just looking it up here. It looks like they have around 450 million users. Assuming each of them pay a dollar per year – some of them may have gotten it for free for whatever reason in the beginning – it seems like a huge multiplier and there’s a lot of discussion about why it’s priced so high and it’s kind of confusing to me, but one thing that you should know here is that there’s a termination fee. If, for some reason, the regulatory powers that be kills the deal, Facebook would still have to pay one billion dollars in cash to these WhatsApp folks. That’d be interesting.

MATT: Yeah, not a bad deal for them. It’s still pretty strange. I don’t know. This is a lot of money to pay for a technology that they seemed to already have. Well, it’s not the same, obviously, but something similar they have in place. I guess this just shows you the power of creating something. A big company like Facebook sees a product that’s better than what they have, and they just buy it up and they bought up a bunch of companies now.
Another company they’re talking about is Snapchat. I’ve never used Snapchat, but I’m familiar with it. I have friends that use it. For those of you that don’t know, I believe you just take a picture and you can send it to someone, put a period of time from one to ten seconds on how long they can view it, and then it disappears. Facebook was rumored to be going to buy them, but now that they have WhatsApp, that’s not going to be the case. All these competing message-sending apps that are out there, I guess WhatsApp has prevailed.
All right, let’s jump into the first question here, too.
This comes from a clothing store in Beverly Hills.
“Can I hire a high school student to work for me?”

NASIR: That’d be fun to work at that kind of store, it seems like, for a high school student.

MATT: Especially for a clothing store, maybe more specifically for a restaurant, I know it’d be pretty big or any store where there’s cashiers. I worked in high school. Assuming that they haven’t been held back, this would be a minor – someone under 18 – most likely working for the store. I think that’s what they’re getting to – whether they can hire a minor and whether that’s allowed. It’s clearly allowed, it’s just the things you have to do in order to make it happen.

NASIR: Obviously, child labor is a sensitive issue. If you intend to have any kind of sweatshop or anything like that, we would advise against that. However, regarding child labor, it’s pretty straightforward, actually. For those of us that worked, the laws haven’t changed too much since we were a teenager. Generally, you almost always need a work permit in any state. In California, you definitely do. usually, that work permit is only eligible only after 12 in most states. In California, I believe it’s also 12. And then, there’s also different rules of how many hours they can work, depending upon whether school is in session or not. And so, that’s something to consider as well.

MATT: Yeah, exactly. There’s restrictions based on the age of the individual. Get the work permit and definitely look into all the restrictions that are out there in terms of how many hours they can work, how many days, just based on their age. As long as you do all the right things, it shouldn’t be a problem with hiring a minor to look for you.

NASIR: Yeah. Believe it or not, they can actually work a tremendous number of hours, just like anyone else. It just depends whether school is in session or not. Also, you have to be able to spread out the hours, too. During school, it’s up to four hours a day. If you think about it, how long is school? It’s at least six hours, right?

MATT: Yeah, I think about seven hours roughly.

NASIR: Imagine a high school student going to school for seven hours and then working for four hours. That’s still quite a bit. One thing I noted is that there’s California law and federal law. In California, most of the California laws apply when it comes to this issue. But federal law has some exemptions just like California does for those child actors. Like, if you’re under 12, but are an actor or something like that, then you can get a permit from the California Labor Board. But the federal exemption also includes news carriers and any kind of domestic service, but then I saw this rule and I thought it was just funny. It said, “Children employed as home workers for production of holly and evergreen wreaths, including harvesting of forest products for such wreaths.” I don’t know what legislator put in that exemption, but it’s so specific! I haven’t even heard of that kind of job. I mean, it’s so crazy!

MATT: That’s the funny thing about laws. You’ll find these little things like that sometimes. I mean, there’s always a back story to why that’s in there. Maybe the person that wanted to put that in there a long time ago and it related to them or something. There are even books out there on weird laws. This probably won’t even fall under a weird law, but there’s always these weird laws that are out there.

NASIR: Yeah, it’s probably the wreath lobbyist that I assume got in there, House of Cards style. Some cattle trading there.

MATT: Exactly.
One last thing on this. Just be smart about it – going with the name of the podcast, Legally Smart.

NASIR: It’s Legally Sound, by the way.

MATT: Oh. Well, I screwed that one up!

NASIR: Be a smart business person.

MATT: Be smart about it because, I remember one time talking to someone and they just wanted to just increase their expenses so that they could reduce their tax liability. They said, “Could I hire my son to do some work at the business? Maybe sweeping and stuff?” I was like, “Oh, yeah, well, maybe. How old is he?” He’s like, “He’s 3 years old.” I’m like, “You’d put your 3-year-old on the payroll?”
You’ve got to be smart about it.

NASIR: Maybe in their commercial as an acting gig or something.

MATT: Yeah, and I forgot to mention, this was a wreaths-making business.

NASIR: Oh, that’s a good one.

MATT: Well, I think we answered that one.
Let’s get into the next thing here. This is pretty interesting, and this is something that’s pretty common. You sign an agreement, sign a contract, and periodically they have updates to it and amendment.
Capital One had their credit card policy and they updated it. That’s not uncommon. That happens all the time with different companies. But this one was a little bit different. This is what it says.
“Capital One may contact you in any matter we choose, including calls, email, texts, faxes, or personal visit at your home and at your place of employment.”

NASIR: Oh, man, and your employment? That’s even worse.

MATT: This is just weird. I’m sure most people didn’t even see this. Most people, I’m sure, didn’t even read the updated policy. But now that people are signing away that they can come visit your home and place of employment. This seems like intrusion. I’m just trying to think of the rationale behind having this in place, having this part of the clause in there.

NASIR: Well, at the end of the day, they know that, just like every credit card company, at one point in time, for a lot of their customers, they become debt collectors. And so, they have to put in these provisions that provides the case, and this is not dissimilar to what other businesses have to do. We all have clients, we all have customers. If any time we provide the service or product before payment, then there’s a risk that that customer or client may not pay. And so, what do you do afterwards? I would find it strange that they would go to so much trouble by sending someone out to do a personal visit. So, I’m just wondering if it’s just in the case that they need to do it that they would actually exercise it, but the fact that they would actually do this on a regular basis or even on an occasion would be strange to me.

MATT: Yeah, pretty weird. I agree with you. I think the number one reason would be that repossession issue of people who don’t pay their credit card, they need to come and collect on it. But, even then, it’s just pretty – I don’t know if there’s other credit cards – maybe I should look at my policy and see if that’s in there. I don’t know. Maybe it is. I pay off my credit card so I’m not too concerned. Or at least I try to.

NASIR: I may just stop paying my credit cards and see how they contact me and then test it out.

MATT: I was actually looking into getting a Capital One card and I still probably will because I know some of my friends have gotten it and they said it’s really good rewards points for airline travel.

NASIR: The only thing I don’t like about Capital One is that, if you don’t pay your bills, they’ll just come to your home and your place of employment. That’s my big thing.

MATT: Or if you don’t like Alec Baldwin, I guess. I know that he’s been a big promoter.

NASIR: And Jimmy Fallon.
Actually, I found this story on Consumerist.com which usually is one of my favorite websites, but they really messed up on this article because this is, again, kind of on a legal perspective that may not be interesting – but it is to me – they interviewed a constitutional lawyer whether this is a violation of the Fourth Amendment. Literally, it says, “It sounds really invasive, but I don’t think it’s a violation of your Fourth Amendment rights.” Well, no kidding! Because, as we should all know – as experts of the Constitution – the Fourth Amendment rights applies to government actors, not private parties. Even though Capital One may be regulated by the federal government, I’m pretty sure that wouldn’t include them being designated as a government actor. By the way, the Fourth Amendment in the search and seizure laws.

MATT: Busting out some constitutional law.

NASIR: Well, it bugged me. I was like, “This is ridiculous!” I’m surprised this lawyer didn’t say, “I don’t know why you’re interviewing me but thanks! I’d love to be plugged into one of your national blog posts, so thanks for interviewing me!”

MATT: Yeah, I’m going to start searching out areas of law I don’t practice and just say the same sort of thing. “Well, I don’t see…” just some random immigration law article.

NASIR: Yeah, I don’t think the Fourth Amendment applies to breach of contract. I think you’re okay. I’m a constitutional law expert. Thank you.

MATT: I guess we’ve talked about constitutional law with free speech before, so this isn’t the first time.

NASIR: Oh, absolutely, that applies.

MATT: All right, let’s get into the next question here.
“I sent my Articles of Incorporation into the state to form my corp. What business expenses can I deduct in the meantime?”
This is from someone in San Jose, California.
You can definitely deduct expenses pre-incorporation status, but there are some limitations on this. I believe, initially, you can deduct up to $5,000 worth of expenses and any of the remainder is going to have to be allocated over a period of time. There’s always some pre-incorporation expenses. If you’re going to use an attorney, maybe you can pay them. Maybe you’re getting a lease for an office or things of that nature.

NASIR: Yeah, and I think there’s some other tax rules if your startup costs end up exceeding $50,000. I think that gets into a little bit of the details. But, generally, if you’re going to be spending any money before you’re incorporated, it’s a good idea to sit down with a tax planner to make sure that everything is going to be allocated accordingly. Also, when we were reading the question, we were confused whether it was deduct or conduct business. That’s a different question – whether or not you can conduct business before incorporation. What about that question, Matt? What do you think?

MATT: We might have answered this before. I can’t remember.
I guess people have varying views. I don’t like to sign anything until the entity is actually formed. But there are ways you can go about things to enter into agreements if you really have to, but I’m on the side where I don’t like to do anything until the entity is actually existing.

NASIR: Yeah. Usually, it’s so quick. Unfortunately, for example, California, you can’t file online. You have to actually mail it in or have it delivered. That ends up taking some more time – unless you pay for 24-hour shipping which can be costly. You may have three to six weeks of waiting to get this entity formed.
And so, Matt and I, we’ve dealt with this in the past. You can have pre-incorporation agreements and it gets a little tricky because those agreements have to be ratified afterwards and there’s still an inherent risk. But, a lot of times, in the very beginning of the company, that shouldn’t be too much of an issue, but it’s something to tread lightly with.

MATT: Yeah, exactly – two for one there. We answered two different questions in one. Bonus!

NASIR: I was looking at that conduct or deduct and thought conduct was a good question, too.

MATT: All right, this is the perfect time for a break. We’re recording this on a Friday. It happens to be at the time when the US Men’s Hockey Team is playing Canada. I’m not a big hockey fan, but I do enjoy watching the US team play in the Olympics. This is actually the intermission between the first and second period. This is the intermission between our podcast. Perfect timing!

NASIR: If you’re recording the game, then close your eyes because right now the score is zero to zero.

MATT: If you’re, for whatever reason, watching it days later after the Olympics have already finished because that’s when this podcast is going to come out, the Olympics will have already been completed, if that’s the case and you decide to listen to this podcast first, we don’t want to ruin it for you.

NASIR: Well, I’ve been burned many times of both spoiling other people’s scores as well as spoiling it for me. So, I want to be cognizant of those kinds of sensitivities.

MATT: It’s tough. I don’t record things. If I miss a sporting event, I don’t record it. To me, if you don’t watch it live, it’s kind of pointless. But I know someone who’s a big fan of a sports team and I won’t say the name or who he is if he’s listening.

NASIR: What’s his name?

MATT: I’m not going to say. Well, he’s a fan of Kansas basketball, but he records the games and he’ll watch them a week later. Sometimes, it’s a week later; sometimes, it’s that night. I was like, “How do you get around? There’s too much stuff online now for you to not see the score. Or someone will text you or something.”
He’s like, “No, everyone I know – all my friends and family know – just not to bring it up to me now because they know I just watch it later.”
I was like, “Well, what’s your rationale behind doing this?”
“It’s too intense. I don’t like the commercials. I don’t like the way, blah blah blah…”
“All right, well, it’s still kind of weird. It has to be spoiled for you sometimes.”

NASIR: That’s dedication and doesn’t want to waste his time. I appreciate that.

MATT: All right, good break, let’s jump into the next question here.
This is something that’s emerging – well, I think this has been around a little bit, but it’s emerging even more so now – these new internet domains. I think they’re classified as top-level domains. Our website – topfloorlegal.com.

NASIR: Nice plug! Everyone go there right now and just look at the page.

MATT: I should have said LegallySoundSmartBusiness.com.

NASIR: Go to that, too!

MATT: But, now, you can have all these different dot-whatevers. Like, in this example they have dot-guru, dot-dating, dot-sports, dot-wow.

NASIR: You know what our favorite is, right?

MATT: The dot-pizza?

NASIR: Yup! That’s the best one!

MATT: That is in there. I mean, I haven’t looked up all the different ones there are, but they do talk about Pizza Hut might get PizzaHut.Pizza which just kind of looks ridiculous. I don’t know. What’s your take on these? Do you think they’re worth it? Because they’re more expensive than the normal dot-coms. Is it worth it to spend the money on this?

NASIR: I think about it in this way and this is not an old conversation in the sense that alternative top-level domain names have been out there for a while – the first commonly known as dot-net and then you have dot-org and, of course, there’s others that are limited like dot-gov. By the way, dot-org is not limited even though people think you have to be some kind of non-profit. That’s not the case.
There’s been others. For example, dot-biz became recently popular. I should say GoDaddy has been trying to make it popular the last couple of years. And so, we’ve seen an increase in those kind of level domains.
In my opinion, it’s very simple. Everyone wants the premium dot-com, but it’s limited. There’s always going to be a limited number of variations of a domain name under a dot-com. Eventually, you’re going to have open up more property. It’s just simple economics. As the internet grows, having the distinction as to whether or not it’s a dot-com or not and entering web addresses I think is becoming less of an issue with users and as it gets more sophisticated.
But I think one of the main things that business owners should be concerned about is you have a dot-com name but what if you are in the pizza business and you own a pizza joint and it’s called – I can’t think of a pizza name! Think of something, Matt.

MATT: How about a place called Slice?

NASIR: That’s a good one. I’m sure there’s one like that. Let’s say a Slice Pizza. You may own SlicePizza.com – and I’m sure that’s already owned – but then, what if someone else takes Slice.Pizza? You may have to make more efforts to make sure you retain that trademark assuming that you own the trademark that you registered and that you own it nationally. And so, it may just require more due diligence on making sure that your marks are not being used without your permission.

MATT: Yes, that seems it’s going to be a big issue with these just because you’re right on how there’s dot-com, dot-net, dot-info, dot-org. But now there’s going to be all these different options and more chance for trademark infringement possibly.
What I found interesting here is they talked about this expansion, including a trademark clearinghouse system which is designed to alert a trademark holder any time someone registers a website with their trademark name. This I found the most interesting of anything in here. That’s pretty cool, if that works.

NASIR: It’s part of the expansion, but note that it’s not automatic. You still are going to have to register – whether that’s a payment or not. But, again, how are businesses supposed to know that they’re supposed to do this? There’s also other monitoring services, for example, for trademarks. And so, I’m sure these monitoring services are going to tap into that as well, so I think that’s going to be their biggest customer.

MATT: Yeah, that’s true. It even says that a lot of people are unaware that this clearinghouse system even exists.

NASIR: Yeah.

MATT: I don’t know. For those of you out there, good ideas like WUPHF.com.

NASIR: Which one is that? You know, I watched that episode a week ago of The Office and I went there again. They still have it up. It’s WUPHF, I think? Something like that. It’s a pretty interesting website. They still have it as if it’s a real startup company and so forth. But, if you recall that episode, they had the, what was it? The Washington University? Some university wanted to buy out their domain name and they were looking at it as an exit strategy.

MATT: Yeah, it’s like Washington University of something.

NASIR: I want to say public health or something like that.

MATT: Yeah, it’s something. What’s funny about that, you know, I don’t know how long ago that episode came out, but there’s apps out there or a service that basically are a real version of WUPHF.com and, for those of you who don’t watch, WUPHF.com basically, any time someone tries to contact you, you essentially get blasted on every single possible way they have to contact you, but there’s actually real legitimate good products out there that are just like that. You know, they’re making fun of it, but it’s actually a real thing that people use and that’s been successful. I forget the name of the big one that does it. I’m blanking on that.

NASIR: I use a more versatile tool – If This Then That. I think it’s IFTTT.com? What they do is basically, if something happens then it tells you to do something. They’ll send you an email if a stock hits a certain price or they’ll automatically tweet something when you upload a photo or different things like that which kind of automates things which you can design to do similar. If you get an email, you can have it also text message it to you, for example.

MATT: I don’t know if it’s Hootsuite. I don’t know if that’s it or not.

NASIR: I think that’s just a social media thing.

MATT: Well, by the end of the episode, I hope I’ll remember what the name of this is, but I just always found that funny how it’s a real version of the fake service they had.
All right, last question for this week
“What are the legal implications of using a customer company’s logo in your marketing materials without its expressed consent?”
This is a good one.

NASIR: Yeah, I agree. I think this is a common thing to do, especially if you’re in a business which has a portfolio or where people want to see your previous work – whether it’s your own marketing or design or something to that effect. A good example is photographers. They’re using past work to demonstrate what they’ve done. But, in this case, we’re talking about actual company logos.
I guess there’s two issues here. It’s possible trademark infringement or copyright infringement. I don’t think trademark infringement makes sense because you’re not creating any kind of confusion in the market as to whether or not you guys are operating under that name or some kind of affiliation. I mean, you’re representing clearly that this is your client. So, the question is you’re using their mark, their copyright on your site. That’s a different issue.

MATT: Right, I think you’re right.
The ting to me is, if it’s your customer, they should just ask them. They’re already at the point where they like you enough that they’re paying you, so you might as well just ask them. I’m sure they’re probably going to be okay with it. If anything, it’s just free publicity for them.

NASIR: Yeah, I agree. Let’s just say that you got an attorney to tell you that you can use this without their permission. Why would you want to do that? Why would you want to go that route? That’s not going to stop that client from being upset. If you’re not willing to get their expressed consent, then I’d be concerned about any kind of blowback even if you may be legally okay.
Now, I’m not saying you are. In fact, I think that there is a reasonable argument to say that you are infringing upon the copyright of the logo itself by displaying it on your site without permission. It may fall under fair use, but I think that’s arguable.

MATT: Yeah, I think that’s good. I think you answered that one well.

NASIR: Well, thank you so much again.

MATT: All right, let’s get into the last story for this week.
This one’s kind of hard. This is more of a visual, I guess, but I’ll try to paint the picture of what actually happened. It was an employee who quit her job, but it wasn’t just a normal leaving. She didn’t just give her two weeks and leave. She did this whole thing where she took all these pictures of her writing messages on a whiteboard, telling her boss that she was quitting. And then, she kind of says all these negative things about him – not in the best way. I’m not a big fan. This has become pretty popular, but all these ways to quite your job and I know some guy brought a whole marching band in and all this stuff. I’m not a big fan of this. I don’t really see the point in it.
Anyway, she did it. She wrote all these little messages on this whiteboard – not the best idea. But, even worse is her boss does the exact same thing…

NASIR: In response.

MATT: And just makes the situation much, much worse. It’s basically the exact opposite of class.

NASIR: Yeah, and just to kind of give some examples and we’ll post the link, of course, to our website so you can enjoy the fun as well. She basically says, “Okay, I’m quitting.” And then, she says – I don’t even know how to get into this, but she talks about how she heard that she was called HOPA which apparently is an acronym for a set of words which you can look up yourself. Then, also says that everyone in the office pretty much makes fun of him – the boss, that is – and office morale is down. And she started looking into her boss’ internet activity and found that four hours per week was on Scotch Rate, 5.3 on TechCrunch, and then 19.7 hours per week o Farmville which is pretty funny. But, of course, then the response is just ridiculous in the sense that I don’t even get this.
He says, “Oh, yeah, you got me on that Farmville stuff, but I figured out how to use it as a fuzzy cognitive map predictor of spikes in the German capital market. Look for the write-up on TechCrunch next week.” I didn’t really get it. But here’s the kicker.
At the end, he’s like, “You remember that employment agreement you signed on your first day – the one that you just violated in 15 different ways?” I’m reading it literally, by the way. “Our legal council would like a word with you about that.”
I’m not sure but here’s something I want to talk about. Not even knowing these people, just in our experience, I can generalize and know that their company culture is way out of whack. They’re talking about how each of the office employees are talking about each other behind their backs and calling them names and talking about office parties and how things got out of hand and so forth. You can just tell that this is a company that not only is going to get into legal hot water in this transaction with this termination, but pretty much over and over again going into the future, and I think it starts at the top with my assumption is, if this is the boss or CEO.

MATT: Right, and who’s going to want to work for this guy? Who’s going to want to work for this company if this is the culture that’s there? I didn’t understand the employment agreement either. That’s something that probably has nothing to do with what she did here. Maybe she did violate something by doing this stuff. But, first of all, he should have never responded.

NASIR: Yeah.

MATT: Second of all, he should have just not said a bunch of this stuff he said in there. He tried to throw her under the bus by what she said about their lawyer, but that’s going to come off bad on him, too. He’s trying to act all smart and he’s just got being smart about it.

NASIR: No.

MATT: Going to the theme of this podcast of smart business.

NASIR: And he says his legal council is going to be calling her or contacting them. He did not talk to his attorney before doing this because he admitted, for example, that, “Oh, I’m sorry you’re grumpy about the nickname we gave you being HOPA,” and then he went on to say three or four other nicknames which are all almost as equally offensive. Of course, the fact that he admitted saying this stuff is just a lawsuit waiting to happen. I don’t care if you’re in California or not. This is not a good thing in any state.

MATT: Going back to the company culture thing, if you haven’t seen the article, someone’s taking pictures of him holding up all these signs. It’s hard to maybe say something to your boss, but maybe the person who was taking these pictures should have thought during this whole process, “You know, maybe this isn’t the best idea.” There’s a lot of issues with this. I don’t even know what company it is. He says he has 100 million dollars in managed assets. Who knows if that’s true?

NASIR: You know, the fact that he’s mentioning that just shows his arrogance. If he wants to live his life fighting lawsuits – and some people just get a high out of that and always trying to be right and so forth – frankly, we’ve had clients like that, but they just don’t work out for us because – not to plug TFL here again – our job as lawyers, especially corporate counsel, is to prevent these disputes from occurring, not to win a dispute. If you get into a dispute, in my mind, you’ve already lost. That’s a lost battle because litigation sucks. It’s stressful and it’s expensive.

MATT: Right, and that was actually one billion dollars in assets which is a pretty high number.

NASIR: I think that’s what he says he manages, not what he owns.

MATT: Yeah, just manages, but I agree with you. It’s that all around.

NASIR: Okay. You disagree with the boss. I’ll note that.

MATT: I disagree with both people, but more so the boss.

NASIR: Yeah, I agree, too. But, for some reason, same with you, I don’t put as much accountability on the employee. That’s why they’re the employee. I mean, the employer has the responsibility in this case.
All right, I think that’s our show. We are in the second period. This goes by period, right? In hockey?

MATT: Yeah.

NASIR: Okay, second period of the USA-Canada game and Canada is ahead by one. The score for USA is zero. Good game so far. Very close.

MATT: Yeah, we’ll be hopeful that the US will turn this around. There’s a lot of time left.

NASIR: There’s three periods, right?

MATT: Yeah.

NASIR: Okay. So, yeah, we’re only in the second period there.

MATT: We can just continue this show. We can just live.

NASIR: Let’s break to the USA-Canada game!
Oh, man, this episode is getting longer and longer. I think we should cut it.

MATT: Remind people again, I know we mentioned the site, but you can email at ask@legallysoundsmartbusiness.com if you have a question that you want to ask.

NASIR: You got it. All right!

MATT: Yeah, I think that’s it.

NASIR: Very good.

MATT: This is Episode 19.

NASIR: This is the 19th episode of Legally Sound Smart Business.
Thank you for joining us!

MATT: Keep it sound and keep it smart.

Legally Sound | Smart Business

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The Podcast Where Nasir Pasha and Matt Staub cover business in the news with their legal twist and answer business legal questions that you the listener can send it to info@legallysoundsmartbusiness.com.

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Legally Sound Smart Business

A business podcast with a legal twist

Legally Sound Smart Business is a podcast by Pasha Law PC covering different topics in business advice and news with a legal twist with attorneys Nasir Pasha and Matt Staub.
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Latest Episodes

October 12, 2021

In our latest episode, Nasir and Matt are covering the legal issues on Social Media. The average person spends most of their day on social media, whether they are scrolling for hours or publishing their own content. However, just because you publish your own content on Instagram does not equate to you owning that image….

September 28, 2021

What is a Non-Disclosure Agreement, and when do I need one? In this episode, Nasir and Matt shares why you need to use Non-Disclosure Agreements, basic facts about NDA’s, and discuss about the infamous Jenner-Woods story. Having the right Non-Disclosure Agreement in place not only protects you and your business, but it also makes the…

July 14, 2021

Through a five-round championship bout, Matt travels to Texas from California to determine which state is better for business. Will it be a knockout with a clear winner or will it go to the scorecards?

June 16, 2021

Covered in this episode of Legally Sound Smart Business are some typical business mistakes blunders small businesses often make and how to avoid them. Blunder #1: Copying and pasting agreements It may sound like a good idea at the time, but this blunder comes with hidden pitfalls. Having an attorney draft terms that are specific…

February 4, 2021

How you terminate an employee can make the difference between a graceful transition to avoidable negative outcomes like a dramatic exit or even a lawsuit. We gathered a panel of experts and asked them – is there a “right way” to fire an employee? We would like to thank our guests for this episode: Amr…

December 2, 2020

The COVID-19 pandemic has turned nearly every aspect of life on its head, and that certainly holds true for the business world. In this episode, Matt and Nasir explain how the early days of the pandemic felt like the Wild West and how the shifting legal playing field left a lot open to interpretation and…

November 16, 2020

After plenty of ups and downs, our buyer has finally closed on the purchase of their business. While we’re marking this down in the ‘wins’ column, it never hurts to review the game tape. In this final episode, our hosts, Matt Staub and Nasir Pasha, return to the deal almost a year later to reflect…

September 15, 2020

The ink is drying on the signature line and things are looking great for our buyer. After so much hard work, the finish line is in sight and the cheering within ear shot.   Though the landlord is still serving friction, things seem safe to move forward and for now, our buyer will be keeping…

July 31, 2020

Though things are coming along well, the journey would not be interesting if it was purely smooth sailing. After our buyer opens escrow, they are forced to push the closing date back when suddenly a letter from an attorney was received claiming the business, we are buying has a trade mark on the name!  Now…

June 12, 2020

With frustration at an all-time high and professionalism at an all-time low, our friend the Buyer has “had it” with the Seller and quite frankly their lack of knowledge. At present our Buyer is rightfully concerned that the latest misstep from our loose-lipped Seller will threaten not only the entire operation of the businesses but…

May 11, 2020

As we go deeper into the buying process, we start to uncover more challenges from our seller and encounter some of the wrenches they are tossing our way. When we last left off in episode three our team was knee deep in due diligence for our buyer, had already penned and signed the Letter of…

April 4, 2020

One word–interloper! When a new mysterious broker enters the transaction and starts to kick up dust, Nasir and Matt take the reins. The seller signed off on the letter of intent (see episode 2), yet this “business broker” serves only friction and challenges by refusing to send financials, whilst demanding more of a firm commitment…

April 4, 2020

Just as most stories and deals start out, everyone is optimistic, idealistic and full of hope for clear skies. It’s a perfect outlook with a perfect setup for the ups and downs yet to come. Peek further behind the curtain and into the first steps of buying a business: the letter of intent. After the…

April 4, 2020

When a savvy buyer hears opportunity knocking to purchase a prime positioned business, she decides not to go it alone and taps in the professionals to help navigate what could potentially be a fruitful acquisition. “Behind the Buy” is a truly rare and exclusive peak into the actual process, dangers, pitfalls and achievements, that can…

August 7, 2019

GrubHub is subject to two “matters of controversy” that have likely become common knowledge to business owners: “fake” orders and unfriendly microsites.

May 28, 2019

In this podcast episode, Matt and Nasir breakdown the legal issues of the subscription industry’s business on the internet. Resources A good 50-state survey for data breach notifications as of July 2018. California Auto-Renewal Law (July 2018) Privacy Policies Law by State Why Users of Ashley Madison May Not Sue for Data Breach [e210] Ultimate…

March 12, 2019

In recording this episode’s topic on the business buying process, Matt’s metaphor, in comparing the process to getting married probably went too far, but they do resemble one another. Listen to the episode for legal advice on buying a business.

December 3, 2018

Nasir and Matt return to discuss the different options available to companies looking to raise funds through general solicitation and crowdfunding. They discuss the rules associated with the various offerings under SEC regulations and state laws, as well as more informal arrangements. The two also discuss the intriguing story about a couple who raised over…

July 24, 2018

Flight Sim Labs, a software add-on creator for flight simulators, stepped into a PR disaster and possibly some substantial legal issues when it allegedly included a Trojan horse of sorts as malware to combat pirating of its $100 Airbus A320 software. The hidden test.exe file triggered anti-virus software for good reason as it was actually…

April 17, 2018

Attorneys Matt Staub and Nasir Pasha examine Mark Zuckerberg’s congressional hearings about the state of Facebook. The two also discuss Cambridge Analytica and the series of events that led to the congressional hearings, the former and current versions of Facebook’s Terms of Service, and how businesses should be handling data privacy. Full Podcast Transcript NASIR:…

March 10, 2018

The Trump presidency has led to a major increase in ICE immigration enforcement. It’s critical for business owners to both comply with and know their rights when it comes to an ICE audit or raid. Nasir, Matt, and Pasha Law attorney Karen McConville discuss how businesses can prepare for potential ICE action and how to…

February 5, 2018

New years always bring new laws. Effective January 1, 2018, California has made general contractors jointly liable for the unpaid wages, fringe benefits, and other benefit payments of a subcontractor. Nasir and Matt discuss who the new law applies to and how this affects all tiers in the general contractor-subcontractor relationship. Click here to learn…

January 2, 2018

With a seemingly endless amount of new mattress options becoming available, it is unsurprising that the market has become increasingly aggressive. As companies invest in more innovative solutions to get in front of customers, review sites, blogs and YouTube videos have moved to the forefront of how customers are deciding on their mattresses and how…

December 7, 2017

In recent months explosive amounts of high profile allegations of sexual harassment, assault, and varying acts of inappropriate behavior have transcended every sector of our professional world. With a deluge from Hollywood and politics, and the private workforce, accusations have inundated our feeds and mass media. This harassment watershed has not only been felt within…

November 16, 2017

If you are not familiar with the EB-5 program started in 1990 to give green cards to certain qualified investors in the United States, then you may not have been alone a few years ago. Currently, the EB-5 program has since exploded since its inception and now hits its quotas consistently each year. The program…

October 10, 2017

Government requests come in multiple forms. They can come in as requests for client information or even in the form of investigating your company or your employees. Requests for Client Information General Rule to Follow Without understanding the nuances of criminal and constitutional law and having to cite Supreme Court cases, any government requests for…

August 24, 2017

Nasir and Matt suit up to talk about everything pertaining to employee dress codes. They discuss the Federal laws that govern many rules for employers, as well as state specific nuances in California and other states. The two also emphasize the difficulty in identifyingreligious expression in dress and appearance, how gender-related dress codes have evolved…

June 28, 2017

Nasir and Matt discuss the life cycle of a negative online review. They talk about how businesses should properly respond, how to determine if the review is defamatory, the options available to seek removal of the review, how to identify anonymous reviewers, whether businesses can require clients to agree not to write negative reviews, and…

June 7, 2017

On this episode of the Ultimate Legal Breakdown, Nasir and Mattbreak down social media marketing withguests Tyler Sickmeyer and Kyle Weberof Fidelitas Development. They first discuss contests and promotionsand talk about where social media promotions can go wrong,when businesses are actually running an illegal lottery, and the importance of a soundterms and conditions. Next, they…

April 3, 2017

On this episode of the Ultimate Legal Breakdown, Nasir and Matt go in depth with the subscription box business. They discuss where subscription box companies have gone wrong(4:30), the importance of a specifically tailored terms and conditions(6:30), how to structure return policies (11:45), product liability concerns (14:45),the offensive and defensive side of intellectual property (19:00),…

February 1, 2017

Nasir and Matt discuss the suit against Apple that resultedfrom a car crashed caused by the use of FaceTime while driving. They also discuss howforeseeable use of apps can increase liability for companies. Full Podcast Transcript NASIR: Hi and welcome to Legally Sound Smart Business! I’m Nasir Pasha. MATT: And I’m Matt Staub. Two attorneys…

January 5, 2017

The guys kick in the new year by first discussing Cinnabon’s portrayal of Carrie Fisher as Princess Leia soon after her death, as well as other gaffes involving Prince and David Bowie. They alsotalk about right of publicity claims companies could be held liable for based on using someone’s name or likeness for commercial gain.

December 22, 2016

Nasir and Matt discuss the recent incidentat a Victoria’s Secret store where the store manager kicked out all black women after one black woman was caught shoplifting. They then each present dueling steps businesses should take when employees are accused of harassment.

December 8, 2016

Nasir and Matt return to talk about the different types of clients that may have outstanding invoices and how businesses can convert unpaid bills to getting paid.

November 10, 2016

After a long break, Nasir and Matt are back to discuss a Milwaukee frozen custard stand that is now revising it’s English only policy for employees. The guys also discuss how similar policies could be grounds for discrimination and what employers can do to revise their policies.

October 6, 2016

The guys discuss the new California law that allows actors to request the removal of their date of birth and birthdays on their IMDB page and why they think the law won’t last. They also discuss how age discrimination claims arise for business owner.

September 29, 2016

Nasir and Matt discuss the racial discrimination claims surroundingAirbnb and how it’s handled the situation. They also discuss some practical tips for businesses experiencing similar issues.

September 8, 2016

Nasir and Matt discuss whyAmazon seller accounts are getting suspended and banned without notice and how business owners can rectify this situation through a Corrective Action Plan.

August 25, 2016

Nasir and Matt talk about the accusations surroundingfashion giant Zararipping off the designs of independent artists like Tuesday Bassen and howsmaller companies can battle the industry giants.

August 18, 2016

Nasir and Matt discuss Brave Software’s ad replacing technology that has caught the eye of almost every national newspaper and has a potential copyright infringement claim looming. They also welcome digital marketing expert Matt Michaelree to speak on the specifics of what Brave is attempting to do and whether it has the answers moving forward.

July 28, 2016

Nasir and Matt discuss the sexual harassment lawsuit filed by Gretchen Carlson against Fox CEO Roger Ailes. They also talk aboutthe importance of sexual harassment training and properly handling such allegations in the office.

July 15, 2016

Nasir and Matt talk about the changes at Starbucks that have led to many disgruntled employees and customers.

June 23, 2016

Nasir and Matt discuss the criminal charges facing FedExinvolving the alleged transportation of illegal drugs. They also talk about how business owners should address working with customers that may be breaking the law.

June 15, 2016

The guys return after a long break to discuss why Yahoo is auctioning off over 3,000 patents and how this decision will affect the longevity of the company.

May 25, 2016

Nasir and Matt discuss the increase in the salary thresholdfor exempt employees and how employerscan try to avoid paying overtime as a result.

May 18, 2016

Nasir and Matt discuss the Baltimore law that makes it very difficult to operate food trucks in the city. They also discuss all the legal restrictions tohaving a food truck.

May 11, 2016

Matt listens to Nasir recap the developing battle in his hometown of Vandalia, Ohio over whether a Dunkin Donuts can move into a location in close proximity to a local favorite donut shop. They then discusswhether the issue is more legal or personal.

May 9, 2016

The guys kick off the week by discussing a Nevada employee who is claiming she was fired for not supporting the Scientology beliefs of her employer.

April 27, 2016

The guys discuss the massive floods in Houston,how employers responded, and why one meteorologist became a local hero. They also discuss the steps businesses should take in preparing for storms outside the workplace.

April 20, 2016

The guys discuss the boycott of Amazon over the products of an unnamed presidential candidate. They also talkabout how a business should handle a boycott and whether it’s possible to exit one unscathed.

We represent businesses.
That’s all we do.

Oh, and we love it.

We love our work. We love reviewing that lease for your new location. We thrive on closing that acquisition that nearly fell through. We’re fulfilled when we structure a business to grow, raise capital, and be legally protected.

We focus on developing close relationships with our clients by being like business partners. A partner who provides essential, personalized, proactive legal support.

We do all of this without utilizing the traditional billable hour model. You pay for the value we bring, not the time spent on calls, emails, and meetings.

Our team is made up of attorneys and staff that share these values and we are retained by clients who want the same.

Pasha Law PC operates in the states of California, Illinois, New York, and Texas.

Meet Our Team

Fractional General Counsel Services

Pasha Law Select offers the expertise of a high-end general counsel legal team for every aspect of your business at a fixed monthly rate. Pasha Law Select is deliberately designed to allow our legal team to be proactive, to anticipate, and to be comprehensive in serving our clients. To be great lawyers, we need to know our clients. We can’t know our clients unless we represent a select number of clients in the long-term. This is Pasha Law Select.

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