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October 10, 2024 26 mins

Parag Amin became a lawyer to help protect individuals and business owners after witnessing his father’s business fail due to massive undisclosed liabilities. Now, Parag has helped his clients save millions and wants to share his knowledge with you.

In this premiere episode of From Crisis to Justice, Parag shares his personal journey from watching his father’s entrepreneurial dreams crumble to becoming a lawyer focused on defending business owners from legal crises. He explains how the right legal steps today can safeguard your business for the future.

Parag offers three key strategies every business owner should know to avoid legal pitfalls:

  1. Getting Agreements in Writing: Why accurate contracts are crucial and how to avoid costly mistakes.
  2. Partnership Challenges: The importance of clear partnership agreements to prevent future disputes.
  3. Preparing for Lawsuits: Essential steps to document and protect your business from inevitable legal challenges.

Listen in as Parag shares valuable insights that can help you protect your business from potential crises and ensure long-term success.

Learn more about Parag here: https://paraglamin.com

Learn more about Parag’s law firm here: https://www.lawpla.com

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Transcript

Episode Transcript

Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Hi, I'm Parag Amin. Welcome to mypodcast from Crisis to Justice.
As a lawyer and entrepreneur,
I'm passionate about helping smallbusiness owners successfully navigate
situations that can killa business. As a kid,
I watched my dad's dreams of being anentrepreneur destroyed by an unethical
businessman, and I don't want thatto happen to you or your family.

(00:22):
That's why I started my law firm.
I want to protect and defend businessowners and their legacies from crisis.
Welcome to From Crisis to Justice.
My name is Parag Amin.
I'm an attorney and my office and I helpbusiness owners successfully navigate
challenging disputes and protecttheir business, livelihood and legacy.

(00:46):
The reason I started this podcast is Idon't believe there's enough education
and enough information from entrepreneursabout the potential legal issues that
could destroy their business. So Iwanted to put this information out there.
I wanted to make it more accessible, andI want you and your business to thrive.
The reason I wanted to do any of this,

(01:07):
the reason I became a lawyer inthe first place is because my dad,
who's an immigrant from India,
had taken his life savings andinvested it in this store in Florida.
I remember moving from New York toFlorida because my dad had taken
everything he had and investedit in this business because he

(01:30):
believed that entrepreneurshipis the American dream.
So he moved my family toFlorida and I remember him and
my mom would be working 60, 70,
80 hours a week trying to getthis business to be successful.
And after toiling away andworking hard for a couple years,

(01:51):
the taxing authority from Floridacame knocking and told him that he
owes over $200,000 in unpaid sales taxes.
My dad said, there has tobe some kind of mistake.
We don't even make that kindof money here at the store.
You have to have made some kind of error.
There's no way we could owethat much in unpaid sales taxes.

(02:14):
What my dad didn't know isthat when he had purchased the
entity that owned the storefrom the former business owner,
he had bought all the liabilities with it.
And what he also didn't know and thatthe former owner had not disclosed
to him, is he hadn't paid his sales taxes.

(02:35):
So now the Florida taxing authoritydidn't care. They said, look,
you owe us the money.You've got two options. One,
either pay us what you owe us,or two shut down your business.
And facing that huge liability,
the calculations and the financials justdidn't make sense for my dad to keep
going.
So he made the tough decision to shutdown the store that he had put his life

(02:58):
savings into. And after that,
he tried to find his footingby finding another business,
but he just couldn't find the right thing.
And because he had ayoung family to support,
he ended up getting a W2 joband he ended up losing his dream
of becoming an entrepreneur.
So that taught me at an early agethat entrepreneurship and the right

(03:20):
legal representation go hand in hand.Had my dad just had the right advice,
had he just had the right guidance,
I think he would've been able tosurvive this or even prevent it.
And that's why I went on to law schoolis because I didn't want that to happen
to somebody. I cared about somebodyI loved or to other business owners.
So I went on to get my law degree from the

(03:45):
University of Southern California,
and I started my practice acouple years after graduating.
And the intention has always been to helpbusiness owners successfully navigate
challenging disputes or issuesthat can destroy their business.
Today I want to talk about threebig ideas that can help you and

(04:05):
your business avoid some ofthe challenges that I see.
The first issue I want totalk about is agreements,
making sure you have your agreementsin writing and making sure that they're
accurate. A lot of business ownerswill get the first part right,
and they'll have their agreementsin writing. But the second part,
I see time and time again being ahuge mistake with business owners.

(04:27):
Many times business owners are usedto doing handshake deals or having
conversations and they'rebig picture people.
They're not necessarily involvedin all of the intricate details.
And one of those intricate details ismaking sure that the agreement is in
writing and is accurate.
So what happens is business ownerswill discuss something with somebody

(04:50):
else and have a handshake deal about it,
and they might even havea written agreement,
but the written agreement doesn'tactually accurately reflect what they had
discussed and what they had agreed on.
So what happens in that situation iswhen there's a dispute or a lawsuit,
everybody goes back to the contractand then there becomes a dispute about

(05:11):
the contract not beingaccurate. And unfortunately,
when you're a business owner,
you're automatically assumed to besophisticated regardless of whether you're
sophisticated or not.
It doesn't matter if you have a tremendousamount of experience or if this is
literally the first day of your businessthat you entered into this agreement,
and it doesn't accurately reflect whatyou thought it was supposed to reflect or

(05:35):
what you thought the agreement was.
So you wanna make sure you have youragreements in writing and that they're
detailed and accurate becausemost agreements will have something known as the
integration clause.
The integration clause says that thisis a full and accurate representation
of what the agreement actually was.
It also says that it supersedes anyand all prior discussions or written

(05:57):
agreements. So when you get intoa dispute and you try to say,
well, this isn't actually the agreement.We had discussed something else,
we had agreed on something else,
the other side's going to come backto that exact clause and say, look,
not only is it not in writing,
but you agreed that this writing thatwe're all looking at is the full and final

(06:17):
agreement. So do yourself a huge favor.
Make sure you're payingattention to the details.
Make sure that you're getting youragreements in writing and that they're
accurate. Don't let somebody tellyou that it's not a big deal. Oh,
there's a provision of this agreementthat we don't normally enforce. Anyways,
it's fine. Go ahead and sign itso we can get this deal done.

(06:38):
Those kinds of things can andwill come back to haunt you later.
My office has dealt with at this point,
hundreds and hundreds of lawsuitsand disputes probably into at
least a thousand if not thousands.
And one of the things that commonlyoccurs is the thing I'm warning you about
right now, and that takesa lot of time, money,
and energy to sort through becausethen it becomes an argument about a he

(07:03):
said, she said,
and that's what the integration clauseis there to prevent is an argument about
a he said she and a disagreementabout what the actual agreement was.
Because if it's not in the agreement,it's not a part of the agreement.
I'll give you an example.
I represented a sophisticated businessowner who had gotten into an agreement

(07:24):
with an ex romantic partner, had his,
they had gotten intothis real estate deal.
He had signed a promissory notesaying that he was going to repay her
$275,000 plus interest plus her attorney's
fees if he didn't repay it.
So that agreement wasdrafted by her counsel.
He thought it was wise to simply handleit on his own because he had years of

(07:48):
business experience and at that pointthey were in a relationship that was going
well. He never thoughtanything would come of it,
and he thought that the businessrelationship would continue on and be
prosperous. She wantedthis agreement in writing,
even though he said that the agreementwas that they had invested in a property
together, meaning they wereboth bearing the risk of loss,

(08:09):
that this was not supposed to be apromise of repayment by him to her,
but instead they had both invested inthis business together in this property
together. And if it was successful,they would share the profits.
But unfortunately,
what neither of them expected tohappen happened and the property
was ultimately sold at a foreclosuresale and they lost their investment.

(08:33):
So what did the ex romanticpartner do? And at that point,
she had become an ex romantic partner.
She sued him on theunpaid promissory note.
The promissory note was notarized.
There was no doubting thatit was my client's signature.
My client had admitted it's his signature.
So the issue is just the black and whiteterms of the promissory note where at

(08:54):
that point his exposure exceeded overhalf a million dollars because he had
unpaid interest, he had unpaid principle,
and he also had to pay potentially theother side's attorney's fees if he lost
on what was a black and white agreement.
He hired my firm to help him navigatethrough this crisis and issue. Ultimately,
the other side kept coming back to thesame problems I'm telling you and warning

(09:17):
you about right now, whichis the agreement is black and white, it's notarized.
There's nothing in there about aninvestment between them together. Look,
luckily my office and I were able tosuccessfully navigate this for the client
and we got him off of a paymentplan over 18 months for paying about
$49,500 a split evenly over 18 payments.

(09:38):
And we had made a motion to make surethat that was enforced that we won.
So we were able to get our client outfor a fraction less than 10% of what
was owed or would've been owed hadhe lost the agreement. Ultimately,
the issue there was the otherside didn't want to go to trial.
They knew that we'd do well at trial andthey chose to settle out the agreement,

(10:01):
but it was a risky maneuver for my client.
It could have cost him alot of money if he had lost.
So make sure that you have your agreementsin writing that they're accurate
because regardless of how goodthe relationship is right now,
it might very well sour in the future.
There may be a reason you have to go backto the agreement and if the agreement
isn't accurate, it could be very,very problematic for you. Now,

(10:23):
the second thing I wanna warn youall about is partnerships and getting
into partnerships,
you want to make sure that whoever you'regetting into a partnership with has
the right attributes and work ethicbefore you get into that partnership.
And of course, make sure you haveyour partnership agreement in writing.

(10:44):
This will include things suchas making sure that you have
a written list of rights and obligationsthat you each have to the business and
to each other.
Some of the things you want to thinkthrough with counsel are what happens
if one of you unfortunately passes awayor one of you no longer wants to be in

(11:04):
the business? What happens to thatpartner's ownership interests?
Can they simply sell itto whoever they want?
Can they simply transfer it towhoever they want? Because remember,
if you're a business partner with thisperson and they transfer the ownership,
you might end up in a partnership withsomebody you don't even know or possibly
somebody you don't want to be in apartnership with. So you have to be very,

(11:26):
very careful about how you lay this out.
Another example is ifeverything's going well,
how and when are profits supposedto be dispersed or distributed?
You may have one partner who wants toreinvest any and all profits back into the
business,
and you may have another partner whowants to take profits out of the business.

(11:46):
Remember, if you do haveprofits in the business,
you are probably going to have a taxbill regardless of whether you choose to
reinvest in the business. Now, of course,talk to your tax attorney about this,
but generally speaking,
you're going to have a tax bill if youhave a profit regardless of whether you
choose to reinvest it.
So you could be in a situation whereone partner wants to reinvest all of the

(12:09):
profits into the business. Well,you've still got a tax bill to pay,
which means that you'vegot negative cashflow,
which could be potentially problematicfor you depending on your cashflow
situation and your otherfinancial obligations.
So this is just a simple example tohelp you think through how you want to
handle things such as money,

(12:29):
whether either side has to put more moneyin if the business isn't doing well.
That's another thing that could affectyour financial obligations and position
outside of the partnershipif you have other businesses.
You also want to considerif you're allowed to start a competing business or if
your partner is allowed tostart a competing business or whether either one of

(12:52):
you has to put in a minimum number ofhours into the partnership to help make
sure that the partnership'sbusiness is successful.
You also want to think aboutwhether either of the partners is
supposed to draw a salaryand if so, how, when,
whether that needs unanimous approvalfor the purposes of increasing

(13:13):
or decreasing somebody'ssalary. As you can imagine,
this can get very complex andthere's a potentially endless list of
questions, but there are thereally important questions.
It goes down to the 80 20 rule where80% of your problems will come from
20% of the things that youhad not thought through.

(13:36):
So you wanna make sure that you've gotcounsel helping you think through at
least the major issues,
if not a significant portionof the problems that are gonna cause you potential
issues because those are the thingsthat end up costing you a lot of time
and money. Now,
the third thing that you wantto make sure that you've got is

(13:58):
being prepared for a lawsuit.
I'd like to go back for a moment andgive you an example of a partnership
dispute before we jump to the thirdissue of of being prepared for a lawsuit.
Partnerships,
I represented a partner in apartnership dispute where her and
her ex romantic partner had alsogotten into a business relationship

(14:22):
together.
They had invested in real estate andthey simply hadn't thought through the
issues,
and instead they thought they werethinking through the issues by getting
their partnershipagreement off. LegalZoom.
LegalZoom can be great for some things,
but when you're thinking through apartnership that's going to have any
substantive value whatsoever,

(14:42):
it's probably not going to be theright choice because it doesn't
think through the major issues for youand it doesn't help guide you through
most of the issues that canpotentially cost you a lot of money.
So in this example with the partners,
they had gotten into a partnershipagreement over the real estate using

(15:02):
LegalZoom and one of the partners hadput in a substantial amount of the
capital, whereas the other partner wasdoing more of the day-to-Day work on the
partnership.
But all it said is that they're both50 50 owners of this partnership
and when the romantic relationshipfell apart and there were disagreements
about whether each side was doingwhat they were supposed to do,

(15:26):
there was a huge disagreement infinger pointing back and forth that the
other side,
the other partner wasn't doing what theyhad agreed to do and they shouldn't get
50% of the partnership. So inevitablythis case went into litigation,
meaning a lawsuit we litigatedfor months. Ultimately,

(15:46):
my office and I were able tosuccessfully resolve this case
favorably from my client.
She walked away with millions morefrom the real estate deal than her
ex-partner because of some creative thingswe were able to use in resolving her
case and some creative arguments we wereable to make about how the other side
simply hadn't done what they were supposedto do and how it cost the partnership

(16:10):
money. But getting to that pointalso took more time and money.
So you want to make surethat you are thinking
through the partnership agreements. Now,
luckily in the case thatI just told you about,
we were able to get the clientmultiples of which she had paid many
multiples of which she had paid andattorney's fees as a resolution.

(16:33):
But remember, these kinds ofthings are many times zero sum.
So the other side ended up losingmillions of dollars that they might have
otherwise been entitled toall because of an improperly
drafted, poorly draftedpartnership agreement.
So make sure you've got yourpartnership agreements thought through.

(16:54):
Do this before a dispute arises,
before a problem arises because problemsare much easier to resolve when they're
hypothetical rather than actualthings are much less emotional
when you're thinking through aproblem before it's actually affecting
somebody's bottom line and it'saffecting their livelihood.

(17:15):
So think through it. Saveyourself a bunch of time, money,
and headaches by having the rightrepresentation ahead of time. Now,
the third point I wanted to talkabout is being prepared for a lawsuit.
Look, I know that no business ownerwants to go through a lawsuit,
whether you're on the plaintiff's side,

(17:36):
meaning the one filing thelawsuit or on the defense side,
meaning you're the one who's being sued.
It isn't typically what you wanted to do.
You see it more as a lastresort than something as a
first choice. Inevitably,
lawsuits will arise regardlessof how small or big your

(17:58):
business is. If you'rein business long enough,
unfortunately you are goingto be involved in a lawsuit,
so you just wanna make sure you'rebest prepared for that lawsuit. Now,
you may be wondering how you do that.
It's great that you tuned in because I'mgonna tell you exactly how you remain
well prepared for theinevitable lawsuit. First thing,
as we talked about earlier, make sureyou've got your agreements in writing.

(18:20):
Make sure they're well documented.
Make sure that they're accurateabout what the true agreement is.
Document as much as you can.
Documentation is kingwhen it comes to lawsuits.
Having things in writing is 10times better than having some
kind of verbal agreementbecause look, in most cases,
although verbal agreements are justice,as enforceable as written agreements,

(18:44):
the problem arises when it's just a verbalagreement without anything in writing
or with very little in writing.
Memories differ and memories fadeabout what the actual agreement was.
So because a verbal agreement is much more
susceptible to a hesaid, she said argument,
it seems much more subjectivethan a written agreement.

(19:09):
Written agreements and writtendocumentation about even conversations you've had
regarding agreements or regardingcertain deals will do you a huge
service if you're everinvolved in lawsuit. Also,
when it comes to written documentation,
it doesn't always have to besome formal legal document.

(19:29):
You can send confirming emails,something as simple as, hi,
just confirming our phoneconversation earlier today that,
and then recapping what you discussed.Now here's a quick tip and trick for you.
End that email by saying,
please let me know by no laterthan blank if any of the above is

(19:51):
inaccurate. This is subtle, buta huge difference between saying,
please let me know if any of the aboveis inaccurate along with a specific
deadline versus saying, please confirm.
Because if you think about themodern business environment,
we all get hundreds of emailsa day and it's very easy for an

(20:11):
email to get buried and it's very likelyyou will not get a reply to your email.
So when you write, please confirm,
and they don't send youback the confirming email and you forget to confirm.
Now you've got an email where they'regoing to say, if there's a dispute,
well you said please confirm, and I neverconfirmed because it wasn't accurate.

(20:31):
Now when you flip that and you say, look,
please let me know if any of the aboveis inaccurate by blank date and they
don't get back to you by that dateor they don't get back to you at all.
Now you've got a much strongerargument to say, look,
not only do we have this discussion,
but I documented it in writing and Itold them to let me know if any of the
above was inaccurate andthey never sent me an email.

(20:54):
So surely it was accurate thatone tip alone can save you
a lot of time, money, andheadaches, so make sure you use it.
Another key component is organization.
Having your files organized and easyto find is going to be critical when it
comes to a lawsuit. Now,
the one thing everybody knows about legalrepresentation is it's not cheap. Now,

(21:16):
think about how much more expensivelegal representation gets.
If your documentation isn't organized,
isn't put together well and your lawyeror the paralegals have to go searching
for documents and have to spendtime organizing the documentation,
it's going to cost you alot more time and money,
and it's also going to slowdown the legal representation.

(21:39):
So do yourself a favor byorganizing it ahead of time.
Some simple tips are electronicorganization of your files.
By creating folders,
you can create folders with the typesof documents that are going to be in
there. For example, you couldhave one folder titled contracts.
You could have anotherfolder titled text messages.
You could have anotherfolder titled emails,
and you could drag and drop andput all of that into the electronic

(22:03):
folder. This will not only makeit much easier to organize,
but it'll also make it much easier foryou to be able to share the information
with your counsel so they can easilyfind out what's going on and easily
find the relevant document ordocuments that pertain to your case.
The other added benefit ofdigitized documents and electronic

(22:25):
documents is you can more easilysearch through those documents.
So if you're looking fora specific term or terms,
if you're looking for a specific date oryou're trying to organize the documents
in different chronological order,depending on what you need,
that will be much easier if youdo it electronically than if you
do it with a physical binder ora physical box full of printed

(22:49):
papers.
Imagine how much longer it's goingto take for somebody to transport and
sort through written documentsand to search for that one.
Document the needle in a haystackin all of the documents you have.
So take advantage of modern technology.
Make sure you'redigitizing your documents.
If you want a quality scannerthat can digitize written

(23:14):
documents that you don'thave electronically and you want a document scanner
that can do it easily and quickly,
you can pick up a Fujitsuscan, SNAP scanner.
I do not get any kind ofaffiliate revenue for saying that.
I am saying that simply because I haveused it for years and it is the best I
have found on the marketas far as a scanner goes,

(23:36):
that isn't a large scannerthat's very portable.
That can make scanning hundreds or eventhousands of documents of a breeze.
This will be one of your best friends ifyou have a lot of written documentation
that's physical, but it's not digitized.
The other thing you wanna think throughas you're looking through documents and
finding documents and having writtendocumentation is being careful about who

(24:00):
has access to all of these documents.
If you simply let any and everybodyaccess any and all documents,
you could have a major problem If itcomes to somebody improperly using
your information becauseyou have various problems
that can occur by claiming that thisperson was improperly using trade

(24:23):
secrets or confidential informationwhen you're not treating your own
information as confidential,so if you're in California,
you might risk a situation where anemployee or an ex-employee starts a
competing business by using yourconfidential information and you weren't
treating the information as confidential,
and so you're gonna have an evensteeper uphill battle trying to say

(24:45):
that this ex-employee was using yourconfidential information if you're not
treating that information as confidential.
So treat information ideallyon a as needed basis.
Don't provide complete access toeverybody at your business to any and
all information. Now, of course, themore confidential the information,
the fewer the people thatshould have access to it.

(25:08):
You wanna make sure that it'ssegregated from the other data. Ideally,
it's password protected that not everybodyhas access to because this is gonna
be a key question if you havelitigation or a dispute later
about somebody improperly using yourtrade secrets or improperly creating
a business that unfairly competeswith you and your business.

(25:30):
Those are the three components, bigideas that I wanted to talk about today.
As a part of this podcast,
I am going to be providing a lotmore data, a lot more information,
so please subscribe so thatway you know when the new
podcast drops. Also,
if you're interested in beinga guest on this podcast,

(25:52):
talking about your business,
talking about how you've successfullynavigated crises in your own business or
legal challenges or problems in yourbusiness, we'd love to have you on.
I will include information below in thedescription so that you can click the
link and apply to be a guest on mypodcast. Thank you so much for joining me.

(26:12):
My name is, and I'm lookingforward to seeing you next time.
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