Purpose Driven General Counsel

You decide to go into business with some people based on your understanding that you will become an equal owner in a mature, established business.

You take all the steps necessary, including leaving your current employment.

But you forget to do one crucial thing:

You forget to get your partnership agreement in writing. Check out this recent unpublished Michigan Court of Appeals decision.

Relevant facts: Roth and Vickery invited Plaintiff to become part of a new business venture. Roth owned Bluestone for over 30 years. Vickery and his wife provided start-up funding for the new venture. Vickery allegedly told plaintiff the following three relevant statements:

(1) Vickery planned on starting a new vehicle-import business in Michigan before 2021,

(2) Vickery “wanted [plaintiff] to consider becoming a part of the new entity that would own that vehicle import enterprise,” and

(3) Vickery considered using Bluestone (the company Plaintiff sought partnership in) to obtain an import license from the U.S. Department of Transportation.

According to plaintiff, he “accepted and relied on Vickery’s invitation to become an equal interest holder in the business. He shut down his own business and started working for the new company.”

Plaintiff was never granted an equal ownership interest in Roth’s company, Bluestone, so he sued Bluestone and shareholders to enforce the “promise” that he alleged was made to him.

The court found that “a promise by Roth to plaintiff was never made. Plaintiff testified that Roth “would try to avoid [discussions about ownership] as much as possible,” and “would never 100 percent positively say” that plaintiff would be a partner. Plaintiff specifically testified that Roth “wouldn’t promise anything.” The testimony unequivocally established that Roth never made a promise to plaintiff, let alone a clear and definite one.

Warren Buffett famously said “I like to deal with people where I feel a one-page contract will do the job. If I have to have 50 pages in there to protect me against the guy I’m dealing with, I’ll always wonder whether I needed 51.”

Lesson here: Go into business with people you trust.

Get it in writing. Even if it is just one-page.

Whether you just started your own business or you have been in business years or decades, a question may arise at some point?

Do I need a board?

Just as quickly as the idea pops into your mind, you are likely to dismiss it. After all, most growing companies skip formal board meetings, thinking they’re only for big corporations or funded startups.

There is nuance in the answer, but every company needs some sort of Board.

There are different types of boards – a governing board, also called a fiduciary board, and a purely “advisory” board.

For greater explanation on attributes of a governing board check out my guest column on Spartans Illustrated

A board of directors’ job is to govern. The board is the linkage between the shareholders in a corporation, and those who are in charge of managing the corporation.

So from a governance standpoint, a member managed LLC, for instance, or a privately held family-owned company where there is no difference between the shareholders, the directors and the operators have no need for a governing board. They are all one and the same.

But there are some commonalities to every business that requires a board.

Boards are visionary.

Boards ideally focus outward more than inward. They spend most of their time looking out the windshield. They spend less time looking at historical facts, looking out the rearview mirror.

Whether you’re a solo entrepreneur or you are on the other end of the spectrum, a group of shareholders disconnected from the day to business, you need to make sure that somebody is setting aside time in space in your company for wisdom.

The board meeting is that place to set aside space for wisdom.

I am reminded of the words from Dan Sullivan, Founder of Strategic Coach: “As an entrepreneur, you can be knowledgeable tightly wound, but you can’t be wise tightly wound.”

The board meeting is also the place where key business concerns are addressed before they become crises.

Further, for companies that are founded core mission/vision/values, the board meetings are the time to step back and make sure that the company is not drifting from its mission and vision, or operating inconsistent with its values.

My offer: whether you are a solo entrepreneur or a seasoned company with a governing board, if your company is truly built on a mission bigger than yourself, I will sit in your board meetings over the next 6 months at no cost to you.

Given my bandwidth, this offer is limited to three purpose driven companies. There is no obligation to continue afterward.

If you are leading a purpose driven company and want to bring more clarity and accountability to your leadership, I’d love to talk. You can reach me at Jeshua.Lauka@LightStoneLaw.com or connect with me on LinkedIn!

Life comes at you fast. This is especially true when building a business.

When growing your business, do you tend to just respond to the day to day?

As entrepreneurs we create our business out of a big vision or guiding purpose – whether or not we have articulated it in writing.

In the daily grind it can be a real struggle to remember the “Why” behind what we are building. When constantly inundated with the details of running a business, who do you rely on to help you step back and focus on the big picture? Who helps you make sure you are actually headed in the right direction?

“It’s incredibly easy to get caught up in an activity trap, in the busyness of life, to work harder and harder at climbing the ladder of success only to discover its leaning against the wrong wall.” Stephen Covey “7 Habits of Effective People”.

“Plans fail for lack of counsel, but with many advisers they succeed.” Proverbs 15:22

So many of us are living “reactive” lives. vs “proactive”.

That’s why we created The LightStone Law “Boardroom Counsel” Services for our Purpose Driven business clients.

We come alongside our business clients as your “boardroom legal advisor” all for a manageable monthly subscription a fraction of the cost of retaining inhouse counsel. This gives our clients access to:

1. Proactive guidance. “Legal Counsel at Board Meetings” (At a minimum quarterly).
2. Prompt Availability. Priority response to your questions (At least 24 hours).
3. Dedicated Access. Dedicated attorney and support team for routine calls/video conferencing and standard contract review and creation.
4. Stop the Clock. We want to get away from the billable hour. We don’t want our clients to be afraid of picking up the phone and calling their attorney just because the attorney is now “on the clock.”

We support your business proactively around 6 Pillars.

Pillar 1: Mission Alignment. If our clients have not yet formed an entity, we advise on the best entity option (LLC, L3C, C-Corp, B-Corp, S-Corp, Non-Profit Corp) based upon your fundamental goals and purpose.

Pillar 2: Hiring and Culture. Hiring and retaining team members that align with core values and ensuring your relationships are documented in appropriate contracts (employment, independent contractor agreements, employee handbooks).

Pillar 3: External Contracts. Contracts are all about risk allocation. Are you appropriately allocating risk away from your company and team members? We make sure all the contractual relationships you have are appropriate to protect your business.

Pillar 4: Scaling. How are you managing growth? Are you taking outside capital to fund your growth? If so, are your investors aligned with your mission/vision and core values?

Pillar 5: Compliance. Looking out into the future are you appropriately managing risk, avoiding pitfalls and liability exposure?

Pillar 6: Exit & Transition/Succession Planning. We help you weigh all the factors involved in succession planning, given your long-term goals.

Interested in learning what might be a good fit for your business? reach out and inquire about our Boardroom Counsel Services.

Right before I left the office today I saw an email from the U.S. Department of Treasury with the following in bold lettering:

FinCEN Permanently Ends Beneficial Ownership Reporting Requirements for Millions of Small Business Owners; Will Delete Information Previously Reported by U.S. Persons

In the last few years leading up to a January 1, 2024 effective date, business attorneys were learning about the Corporate Transparency Act (CTA) and the tedious compliance requirements for the countless businesses we assisted in forming. Some law firms created separate processes to handle compliance with the CTA.

We all breathed a sigh of relief when the rules changed and the majority of our small business clients were exempt from compliance.

Now we breathe even deeper…

“Today, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) is issuing a final rule that permanently removes the requirement for U.S. companies and U.S. persons to report beneficial ownership information to FinCEN under the Corporate Transparency Act. The final rule is effective on its publication in the Federal Register. FinCEN today also announced that it will delete previously reported information by U.S. persons—now exempt from the reporting requirements—from the beneficial ownership information database. Under the final rule, foreign entities that are reporting companies will still be required to report beneficial ownership information for foreign individuals.”

What a roller coaster ride our business clients have been on!

This is apparently the nail in the coffin, closure of a chapter…but man, what a ride…

Check out the official U.S. Department of Treasury press release here

I was reading a court of appeals decision today about a contentious business dispute. The case involved allegations of breach of contract, restrictive covenants, tortious interference… all of which is not the point of this post.

What caught my attention was a footnote from the panel of judges:

“Frankly, we are disappointed that the Titan parties would even raise this issue. Extending professional courtesy costs nothing, and in no way impairs a party from pursuing lawful claims. The fact that the trial court extended grace in a time of medical hardship is in no way indicative of favoritism. It is the decent, human thing to do.”

This isn’t a jab at the particular lawyers representing their clients in this matter, just a recognition that we all get caught up in the daily grind of life.

Sometimes we get so caught up in our day to day. We get caught up in the task at hand and it would really help if we stepped back, took a deep breath and asked ourselves important questions:

• Where am I headed?

“If the ladder is not leaning against the right wall, every step we take just gets us to the wrong place faster.”

– Stephen Covey

• What is my life producing?

Who is wise and understanding among you? Let them show it by their good life, by deeds done in humility that comes from wisdom.

James 3:13

We all need a compass. Something that, in the middle of a busy life, reminds us of our greater purpose and calling in life. When we started building LightStone Law we started with our Mission/Vision/Core Values.

Without a foundation of enduring principles to anchor, we could easily find ourselves wandering from the path.

Make sure you are on the path that leads you to what you are truly going for in life.

I walked off the stage and Jonathan Williams said to me: “It’s over. How do you feel?”

“Exposed“. I replied.

It was a strange experience for sure.

I stood on stage blinded by the lights and began to tell my story.

This was August 21, 2024.

Three years to the day that I watched my mom take her last breath on earth.

Failure Lab exists because we learn so much from failures – from our own and from hearing the stories of others.

There is comfort in knowing that I am not the only one.

There is also comfort in knowing that all failure is learning, if we let it.

We can grow to be everything God has called us to be.

If we let it.

Play long term-games with long-term people. – Naval Ravikant.

Your legal advisor should be someone you trust for the long-term who is aligned with your Company’s core vision/mission and values. If you’re interested in exploring engaging a fractional general counsel for your business or family office give me a call (616)454-3883.