Ping® by Adlerlaw Should My LLC Be Taxed As An S Corporation And Why?

It has become customary for many businesses to set up a limited liability company (LLC). Especially when it is a 1 or 2-person business.  Among the many advantages of LLCs are simple default tax classifications: sole proprietor for 1 member, partnership for more than 1 member, also known as “pass-through.” This is the same regardless of the type of member. However, have you asked your lawyer, accountant, or business advisor if it makes sense to simply take the default classification? Small businesses should consider whether making the election to be treated as a “S-corporation” makes sense.

Read the full article here.

If you are unsure about the benefits or the choices discussed above, feel free to contact us by email or by calling 1-866-734-2568. For over 27 years, we have guided business owners in this important depiction-making process.

Ping® by AdlerLaw A Note On Protecting Descriptive Words

When a party seeks to protect a mark that is unregistered, the plaintiff has the burden to establish its entitlement to protection under the Lanham Act due to the “distinctiveness” of the mark. Platinum Home Mortg. Corp. v. Platinum Fin. Grp., Inc., 149 F.3d 722, 727 (7th Cir. 1998).

“The first step in determining whether an unregistered mark or name is entitled to the protection of the trademark laws is to categorize the name according to the nature of the term itself.” Int’l Kennel Club of Chi., Inc. v. Mighty Star, Inc., 846 F.2d 1079, 1085 (7th Cir. 1988). “Marks are often classified in categories of generally increasing distinctiveness . . . they may be (1) generic; (2) descriptive; (3) suggestive; (4) arbitrary; or (5) fanciful.” Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768 (1992); see also Packman v. Chi. Tribune Co., 267 F.3d 628, 641 (7th Cir. 2001).

A generic term is “one that is commonly used and does not identify any particular source and therefore, is not entitled to any trademark protection.” Platinum Home Mortg., 149 F.3d at 727. A descriptive mark “describes the ingredients, qualities, or characteristics of an article of trade or a service” and may be protectable. Id. (internal quotation marks omitted). A suggestive mark “stands for an idea which requires some operation of the imagination to connect it with the goods.” Id. (internal quotation marks omitted).

While a term that is suggestive is automatically entitled to trademark protection, if a term is merely descriptive, the plaintiff must show that it has acquired “secondary meaning in the collective consciousness of the relevant community.” Id. Courts consider several factors when deciding whether secondary meaning has been established: “(1) the amount and manner of advertising; (2) the sales volume; (3) the length and manner of use; (4) consumer testimony; and (5) consumer surveys.” Id. (internal quotation marks omitted).

Sometimes this issue arises in the context of competing restaurants. Courts will focus on the ‘salient portion’ of the marks. Sullivan vCBS Corp., 385 F.3d 772, 777 (7th Cir. 2004)) The Court compares the parties’ marks in the context of what happens in the marketplace, not necessarily by looking at the two marks side by side. TyIncvJones Grp., Inc., 237 F.3d 891, 898 (7th Cir. 2001). Where “the public will encounter the marks in written as well as spoken form . . . it is essential to consider the marks’ visual characteristics” as well. Barbecue MarxIncv551 OgdenInc., 235 F.3d 1041, 1044 (7th Cir. 2000). 

If you do choose a descriptive name for your restaurant, the name may not be subject to attack based on dictionary definitions linking that term to eating, drinking or entertainment establishments, and on news articles with uses of either in relation to such establishments.

If the term is found to be “highly descriptive,” you will need to prove that the term has acquired “secondary meaning. This can be done by:

  • Showing the term has a double meaning in the minds of your customers 
  • Showing your sales and advertising 
  • Showing how third parties refer to your mark on social media, in articles, or in communications.

Ping® December 2021 – Data Protection & Copyright Law 

Globally, non-profits, NGOs, and environmental advocacy organizations are expanding scientific data collection while combining this data with data from third parties. Data scientists increasingly find themselves applying creative thought the the selection of tools and instruments, calibration of those instruments, and the process and selection of data to measure. This combined data is then used for synthesis, modeling and reporting, with the goal of making some or all of it available to the public. As Data scientists look to make these resources public, there are concerns with protecting the integrity, availability, and accessibility, of these resources. Since availability and accessibility and driven by funding, there is a need to commercialize these assets.

I recently had the honor of discussing the question of what legal rights exist in data at the Environmental Defense Fund‘s monthly Lunch & Learn.

In legal terms, those rights are intellectual property (IP) rights such as copyright, patents, and trademarks, confidentiality obligations, and contract rights. Each IP right has its own rules, and applying those rules to data leads to a complex, multi-layered analysis where the law can be unsettled and uncertain.

The principal areas of law discussed were copyright and contracts. The other forms of IP rights such as Patent, and Trademark did not apply to this discussion on data insofar as the term refers to information only, as opposed to a method or process applied to that data (Patent). A trademark is a source identifier that distinguishes one company, product or service from another and  which is used to prevent confusion in the marketplace.

If you would like a copy of the Presentation in .PDF format, please Subscribe to Ping® -Arts, Entertainment, Media,  Communications, & Technology  Legal News From Adler Law Group.

Venture Capital Weekly Headlines – Ping®

Venture CapitalWeekly update ⋅

September 14, 2021

Chapel Hill’s TrueBridge Capital closes $170M fund, will focus investments in other VC firms …

CHAPEL HILL – Venture capital firm TrueBridge Capital Partners has closed its first venture capital fund-of-funds that will focus on seed ventures.

Russian Telecom Operator MTS Launches $100 Million Venture Fund– Forbes

The MTS AI Intema fund’s launch comes amid a surge of investment in AI-focused startups with over $55 billion committed to the sector in 2020 alone.


Raising venture capital for the first time? Not sure where to start? – Fast Company

Dear Founder,. Congrats on getting to this point. We fund a lot early-stage companies and first-time founders, so …

Volkswagen to set up venture capitalfund in decarbonization push | ReutersReuters(Reuters) – Volkswagen AG said on Tuesday it planned to set up a venture capital fund, which would initially invest 300 million euros ($355.14 million)

Navigating The Venture Capital Space As A Family Office – ForbesForbes

Champ Suthipongchai is a General Partner at Creative Ventures, a method-driven venture capital firm based in the San Francisco Bay Area.

Is it so bad to take money from Chinese venture funds? | TechCrunchTechCrunch

Denis Kalinin works at venture fund Runa Capital as Asia Business development manager, devoted to connecting the Western and Asian VC worlds.

EU Backs Icelandic Venture Capital Fund Focused on Women in Tech – Bloomberg

Iceland’s female-led venture capital firm Crowberry Capital has launched a $90 million fund to invest in technology startups in the Nordics

Venture Fund
 Economics: Why (Fund) Size Matters in Venture Capital – LinkedIn
LinkedInContinuing on “Demystifying Venture Capital” where we break down the inner-workings of venture capital, let’s discuss- ‘Venture Fund Economics

Ping® – Arts, Entertainment, Media & Advertising Law News

U.S. Olympic and Paralympic Committee: The Gold Standard for Trademark Protection. By Kelli Ovies August 3, 2021

The Ted Stevens Olympic and Amateur Sports Act is a United States law (codified at 36 U.S.C. Sec. 220501 et seq. of the United States Code) that charters and grants monopoly status to the United States Olympic Committee, and specifies requirements for its member national governing bodies for individual sports.

Minefield or Mint? Endorsement deals come thick and fast for college athletes, as NCAA floodgates open. BY Khristopher J. Brooks July 29, 2021 MONEYWATCH

The NCAA must now let student athletes profit from their own images, setting up enforcement headaches. The NCAA bans payment to induce athletes to pick a school or to reward specific performances.

The NCAA faces the hurdle of drawing a line between legitimate endorsement deals and those of prohibited compensation arrangements designed to look legitimate. These complex rights deals can hinge on several variables, and the value of an athlete’s image may be tied to athletic success that’s not supposed to be directly rewarded.

Ping® August 2021 – Arts, Entertainment, Media & Advertising Law News

Tell Us How We’re Doing

The motivation to create Ping® stems from my experiences running the Entrepreneurial & Start-up Ventures Committee, and the Media, Arts & Entertainment Committee of the Chicago Bar Association, participation in Illinois State Bar Association committees, and public speaking engagements on the subjects of intellectual property, information technology, privacy, security and entertainment law. 


Every forum meeting or presentation ends with in-depth questions from the audience. I publish Ping® to share knowledge and educate creative professionals and entrepreneurs to be better business owners and managers.
Is the Ping® Newsletter useful or informative for you? Let us know in the comments section, below.

AM Days/AFFILIATE SUMMIT WEST 21

TRAFFICKING IN TRUST: HOW TO ENHANCE AFFILAITE ENGAGEMENT

Attendees will learn best practices, strategies, and tactics from a seasoned legal professional who works with businesses and regulators at the federal and state levels.  We will break down the how, when, where, and what of disclosers and disclaimers as well as recent developments in privacy law such as the California “Do Not Sell” requirements. If you are in a decision-making role in your organization – or just want to be among those in the know on how to restore trust – this is a must-attend event. 

Learn more and register here https://www.affiliatesummit.com/west/am-days

Is It Necessary To Register A Design Copyright?

A client was asking “is it necessary to fill out all the paperwork to register a design even though the law says you already own it?”

It’s a good question. Technically, under the Copyright Act as amended in 1976, the author (creator) of a work owns the copyright. The 1976 Act states that copyright protection extends to original works that are fixed in a tangible medium of expression. This wording broadens the scope of federal statutory copyright protection from the previous “publication” standard to a “fixation” standard. No further action is necessary. Under previous versions of the law, there were publication requirements to perfect ownership.

Under section 102 of the Act, copyright protection extends to “original works of authorship fixed in any tangible medium of expression, now known or later developed, from which they can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device.”

Until the ’76 statutory revision to U.S. copyright law the Copyright Act of 1909 governed, under which federal copyright protection attached only when those works were 1) published and 2) had a notice of copyright affixed. In addition, state copyright law governed protection for unpublished works creating inconsistencies.

Despite the successful streamlining and efficiency of rights creation and enforcement, some challenges and inconsistencies remained. Most noticeably, there had been spit in the federal courts. Some courts required the certificate to litigate, some courts only required proof that an application had been filed.

Last year, the US Supreme Court ruled that in order for a copyright owner to enforce its rights against infringers, the copyright owner must have a registration certificate for the works that are being infringed.

In Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC, 586 U.S. ___ (2019) (PDF here) decided March 4, 2019, the US Supreme Court resolved this split among courts around the country by holding that the mere filing of a copyright application is not sufficient to allow a copyright owner to file suit – actual approval of a copyright application by the United States Copyright Office is required before suit can be filed. Approval comes only in the form of a Registration Certificate.

Returning to the client’s question, while it is true that the Copyright Act says  one owns the copyright in a work when it is fixed, it is no longer true that one can ignore the registration requirements. Yes, one does not have to do anything formal to own a copyright in a work one creates. However, one cannot enforce those rights without the registration certificate in hand. For all practical purposes, there is no reason not to register the copyright in any design, pattern or other distinctive element you create. The fees are relatively low ($65.00) and completing/filing the form can be done electronically.

A word to the wise, like all areas of Intellectual Property, there are nuances that are easily overlooked by the uninitiated. You should always consult with an experienced copyright lawyer when evaluating any individual situation.

Why Now is the Time to Buy or Sell a Business

Looking for Business Opportunities Ahead of the Economic Fallout

In this difficult time of staying at home, people may be looking to buy or sell a business. We have all been impacted in different ways, each of which may be a reason to make a change. Traditional reasons people exit a company arise because of changing economic conditions, a tragic family event, a loss of passion, or simply the desire to retire. At the same time, buyers may be seeking to expand in a sector or industry, add talent, enlarge the customer base, or acquire technologies or resources that can provide a competitive advantage. Witness the unprecedented overnight shift to tele-work, tele-health, remote online primary school education, and live-streamed happy hours and family gatherings.

Thinking of Buying or Selling a Business?

If you are thinking of buying or selling a business, here are three key reasons to act now. First, labor is in flux, and available. As retailers, restaurants, travel companies and other service sectors that employ tens of millions of Americans get squeezed, the tech sector, which tends to have relatively few employees, has surged. Many target businesses may have a lower headcount while retaining a leaner operating infrastructure and access to a ready, willing, and trained talent pool.

Second, the federal government will do what it takes to stabilize the economy and accelerate the recovery. Nevertheless, there is a real risk of many “main-street” companies going bankrupt – making them easy acquisition targets. Opposite that, large-scale public companies (consumer-packaged goods, media) are boosting the broader recovery. Companies on either side of this equation may benefit from the changing market dynamics and opportunities for what comes next. As of this writing, nine states have lifted the stay-at-home orders or will let them expire, with many others soon to follow. The window is closing.

Third, one of few benefits of the current crisis is the acceleration of investment and escalation of consumer-facing products, services, and technologies. Reports indicate that 2020 shows a year-over-year (YoY) increase of over 15% in use of contactless payments.  This is a real opportunity for companies to not only “get lean” but also digitize business practices that can improve the customer experience.

Changing consumer behavior will continue to force this along. According to Forbes, U.S. YoY online retail revenue growth is up 68% in April, surpassing the earlier peak of 49% in early January. U.S. & Canadian e-commerce orders grew 129% with 146% growth in all online retail orders. Online conversion rates increased 8.8% in February, an increase of shopping intensity usually seen only during rare events such as Cyber Monday.

Bottom Line

Most people are sitting around waiting for things to shift and change around them, while others are moving through it all and pivoting on their own. Don’t wait for your competitors to invest in the next generation technologies. Working with experienced legal counsel will help you identify the opportunities and act quickly to negotiate and close a deal. If you are interested in learning more about buying or selling a business, please get in touch.