Most startups initially focus on incorporation, funding, and protecting their intellectual property, which is logical and practical! While these are all important and necessary, startups should also ensure that they are protecting their new startup from legal actions such as a lawsuit – the dreaded “L” word. A lawsuit is the official court process in which two or more parties seek to resolve a dispute. A legal battle can be lengthy, expensive, and create bad publicity. Startups are experiencing a rise in litigation and below we will focus on three growing risks to startups and provide practical steps to prevent these types of lawsuits.

Being threatened with a lawsuit is always frightening and unsettling but sometimes can be avoided. For example, in a sole proprietorship, both the company and owner could be liable for the damages. Structuring a startup as a corporation or a limited liability company could help reduce owner liability. Generally speaking, the creditors of a business also cannot succeed against the founders and other investors of corporations and LLCs for unpaid debts because they are sheltered by the corporate status.
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The answer is “Yes” if your start-up has progressed far enough along to have hired six (6) employees. The Missouri Human Rights Act (“MHRA”) makes it illegal to discriminate in any aspect of employment, including tangible employment actions, because of an individual’s race, color, religion, national origin, ancestry, sex, disability or age (between the ages of 40 through 69).  Under the MHRA, an employer is “a person engaged in an industry affecting commerce who has six or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year.”  This means as your startup succeeds in growing, you must be aware of the 6-employee rule and the impact on your business if you violate the MHRA. 
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Husch Blackwell’s Aleks Rushing has been named to the St. Louis Business Journal’s 2019 30 Under 30 class. The annual award series honors “future leaders of the region and the local business community.” Aleks serves as legal counsel for colleges, universities and schools. On behalf of her clients, she conducts investigations, handles litigation and

Jake Brown Husch Blackwell Meghan Brennan Husch BlackwellWorking with startups recently inspired two Husch Blackwell attorneys to develop an innovation solution of their own. In 2018, Husch Blackwell hosted its first firmwide Legal Innovation Challenge. Approximately 20 teams submitted ideas and went through a rigorous selection process.

Associates Meghan Brennan and Jake Brown work with a variety of clients, including startups. When they came together for Husch Blackwell’s Legal Innovation Challenge, they found a mutual interest in streamlining the initial intake process for startup clients. Together they envisioned a diagnostic tool to assess the legal needs of growing companies. Clients can complete a quick 10-minute questionnaire that will help the attorney develop a road map for company growth and future legal needs.
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Fresh off the heels enacting the California Consumer Privacy Act, California Governor, Jerry Brown, signed the country’s first law governing the security of Internet of Things or connected devices. The bill, SB 327, is entitled “Security of Connected Devices.”

Beginning on January 1, 2020, all manufacturers of connected devices will be required to equip the device with reasonable security features to protect against the unauthorized access, destruction, use, modification or disclosure of information that is collected or transmitted by the device.
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An important aspect of developing any intellectual property strategy and portfolio is deciding which method of intellectual property protection to pursue based on the advantages and disadvantages of each method. Plants may be protected through utility patents, certificates under the Plant Variety Protection Act (“PVPA”), and plant patents. Each of these methods has their own requirements with various levels of stringency for obtaining a utility patent, certificate, or plant patent, as well as different levels of protection, as will be discussed below.

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Many commentators have noted recently that the near-monopoly Silicon Valley has enjoyed in technology startups is beginning to erode. Last month, The Economist magazine dubbed the trend a “techsodus” from the Bay Area and stated that “[Silicon] Valley’s influence is peaking.”

Much of the venture capital investment aimed at technology startups is still raised in and flows into California, but increasingly, when startups look to scale their business models, they are doing it elsewhere, due to the increasingly high costs associated with the Bay Area in terms of talent, real estate, and taxes. This shift in investment will greatly benefit regions that have ample incentives in place to attract startups, areas like greater Kansas City and other cities throughout the Heartland.


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Every company, but especially startups, looks for a competitive edge to provide an advantage over other companies. Intellectual property (“IP”) rights and the strategy of how to leverage them may separate a startup from other companies.

Because IP can be an essential part of a business and of significant interest to potential investors, startups often enthusiastically disclose their inventions, technology, and other IP when pitching to potential investors or at public events. However, pitching to potential investors or publicly presenting before protecting the IP can have devastating consequences for companies.

We provide below a few of the reasons why companies should consider protecting their IP before disclosing it to the public.


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globe charts graphsCongratulations! You have developed or launched an innovative new product or service, and your business dreams are becoming a reality. It’s all very exciting.  One thing you may not have considered much, however, is whether your innovations or brand are susceptible to infringement in the international context. Will competitors try to make a knock-off product or steal your trade secrets? Are foreign companies going to ship infringing articles to the U.S. market? Protecting your intellectual property (IP) is key. Here are some fundamental suggestions to thwart such threats to your growing business.
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