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  1. #1
    Join Date
    Jun 2008

    Default Conflict of Interest Rules for a Business Lawyer

    I am currently going through the dissolution of a (California) partnership/corporation and have several issues that I feel are in question. The simple background of the situation is, I created a business model/idea and all of the intellectual properties/ideas were solely mine. I asked another person to be an equal partner based solely on the fact that he had the infrastructure necessary to help start up the business (office, computers, etc...). We have been very successful in the short time we have been in business, but I caught him in numerous lies and misrepresentations which caused me to end the business relationship.

    We agreed to dissolve, but while I was in the process of trying to wrap up all necessary loose ends, he began to form a new start up business in the same space that we were operating the previous business. He started using company resources (employees, leads, contacts, money, etc...) to operate his new business.

    His new business is essentially the same as before, but he has now asked one of the attorneys who had done some work with us (as well as an attorney whom I don't know) to be partners in his new venture.

    It is my feeling that there would seem to be some obvious improprieties and the only reason he is even remotely getting away with it is because he is the lease holder (which is a sub lease that is currently 60 days late because I would not pay the bill after decision to dissolve as our company wasn't on the lease).

    Here are my questions to anyone who may be willing to help or take a shot at offering an opinion:

    Does conflict exist for the attorney whom we used during our partnership?

    Is the attorney allowed to take my intellectual property/business model and begin a new business that he has never been involved in before?

    Our agreement was mostly verbal, but can he take possession of the infrastructure he brought to the partnership? (computers, phones, etc...)

    What actions can I take to stop my former partner from using resources we obtained through our business for his new business? (injunction, court order?)

    What can I do (if anything) to stop the new business from operating until the old business is completely closed out?

    Considering the fact that he has:

    Used our company credit card to purchase the new company's website

    Used company funds to pay staff for business operations of the new start up

    Used leads we purchased to solicit/market new deals & create new profits

    Used our company accounts/credits/monies/relationships for the new company

    Would it be prudent to allow them to operate for a period of time and then file a claim against profits for co mingling my funds/resources to establish, create and operate his business?

    Also, (these questions are for my own curiousity)

    Can my former partner enter into a partnership with an attorney even though he is not an attorney? (Doesn't affect me in any way, just wondering as my former partner's new business is labeled as a Law Center and that's how his employees are answering the phone ("Law Center") and subsequently telling clients/potential clients that they are "legal assistants" and "para legals" which they are not.)

    In California, does anyone know if it is legal to "Phone Blast" recorded solicitations? (I know there is a Federal Law going into place in September (I think), but I thought it was already illegal in Cali.)

    Is it legal for an attorney to solicit business by cold calling, phone blasting, etc...?

    I know it's long and I appreciate anyone who has hung in this long. Thanks to all.

  2. #2
    Join Date
    Sep 2005
    Behind a Desk

    Default Re: Conflict of Interest Rules for a Business Lawyer

    That's quite a laundry list.... I suggest that you get an independent lawyer of your own, and run your concerns past your new lawyer.

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