Whether you are starting a small business or running an established company, it is vital to understand business laws and regulations. But that is easier said than done. My goal is to provide business-related legal services so that you can spend more time dealing with the actual business and less time with legal intricacies of operating your business. My services include:

Business formation

You have a new and innovative product or service and you are interested in forming a new business. You may have concerns about liability, taxes, investors and other considerations. As your small business lawyers, we will assist you in deciding whether your startup business should organize as a limited liability company (LLC), partnership, S corporation or C corporation. We will form the most appropriate business organization for your new business and register the business in all jurisdictions in which it will conduct business.

Mergers and acquisitions

If your business is fortunate to thrive and become a merger or acquisition target, we can represent you as the seller; or if you are on the other side and looking to acquire a business, we can assist with the due diligence in purchasing a business. We will review various approaches in purchasing a business through merger or acquisition. We will discuss with you various structures in purchasing the stock or purchasing the assets of an acquisition target. In either case, your business will need thoughtful and comprehensive representation in all aspects of a merger or acquisition.

Government contracting

Government contractors face numerous issues when contracting with the government. And with a hands-on approach and substantial experience, we will help you navigate those legal issues. We prepare teaming agreements, subcontracts and joint venture agreements and can handle a variety of other government contract matters. As government contract lawyers for your small business, we can assist you in applying for programs for HUBZones, service-disabled veteran-owned small businesses or women-owned businesses. If your company is facing debarment or suspension because of allegations of corruption or bribery, we can assist in your defense before the U.S. government or the World Bank.

Business transactions

Once you have an ongoing business, however organized, you will have a host of various commercial transactions. We prepare agreements with lenders, lessors, partners, customers, employees, and consultants. We provide business legal services for your company, preparing confidentiality agreements, nondisclosure agreements, licensing agreements, distribution, employment agreements, independent contractor agreements, lease agreements, and many others. We will help you understand what each part of these agreements require and make sure that these agreements provide protection to you and your business.

Corporate law

Once your startup business has been created, your company will have ongoing requirements to maintain its separate status. We will assist in guiding you on how to prepare corporate minutes or resolutions of the company to maintain the corporate form and other steps to protect the limited liability of your company. You will also have to make sure that your bylaws or operating agreement continues to reflect the needs of the business organization. We are available to assist you in addressing these issues. And once your company is ready to raise additional capital from investors, we can work with you to determine whether you are subject to securities laws or fall within one of the exemptions.

Business disputes

Few businesses are immune to business disputes. If your small business was well-advised, you have an agreement that will provide guideposts on how to resolve your business dispute. If you are unable to settle your dispute, you may have a dispute resolution mechanism such as mediation or arbitration in the agreement. An alternative dispute resolution mechanism such as arbitration or mediation generally can provide a relatively quick resolution of your business dispute. If not, then you may have to consider litigation. We handle business disputes, including pre-litigation matters, mediation, arbitration and litigation.

Anti-corruption compliance

Every company should have procedures and policies to minimize its exposure to allegations of corruption or bribery. An integrity compliance program (ICP) is essential for businesses doing work internationally for the United States government or work financed through one of the development banks. We can assist in reviewing or preparing an ICP to assure that is consistent with the anti-bribery and anti-corruption guidelines from the World Bank. If your company is facing debarment or suspension because of allegations of corruption or bribery, we can assist in your defense before the U.S. government or the World Bank.

Non-profit law

We work with organizations to obtain their tax exempt status under Section 501(c)(3) of the Internal Revenue Code. There have been recent changes to obtaining 501(c)(3) status and we have worked with organizations in submitting successful applications on the simplified track by filing a 1023-EZ and the more rigorous 1023 application for larger organizations. Nonprofits also face similar legal challenges to assure that they comply with business requirements and additional requirements to assure that they do not jeopardize their tax exempt status. As a law firm for nonprofits, we work with nonprofit organizations to guide them through these issues.

FAQ Small Business Attorney in DC

What is considered a small business?

Almost all our clients fall within the definition of small business/startup as determined by the Office of Advocacy of the U.S. Small Business Administration. Under this definition, a small business has fewer than 500 employees. Small businesses encompass about 99.9% of all business organizations in the United States.

Which industries do you serve as a small business attorney?

Most of our clients are service providers such as consulting companies, law firms, accounting and bookkeeping services, cybersecurity consultants, video production companies, and lobbyists, just to name a few. We also represent foreign and domestic manufacturers and software developers.

As a small business lawyer in DC, we represent some retail operations, such as bookstores and restaurants. We also represent numerous nonprofits with varying missions. Our government contractors clients hold various IDIQs (Indefinite Delivery, Indefinite quantity Contracts) and GSA schedules.

In which areas of the law does a small business or startup need legal assistance?

Most times, small businesses/startups need the services of outside general counsel. As outside general counsel for small businesses, we can handle most matters as a small business attorney that small businesses generally encounter. Usually, anything with the word agreement or contract is within our practice areas. This includes operating and shareholder agreements, which are used for small businesses and startups that are formalizing their relationships with their owners. Once a business is formed, then we prepare and review a host of other agreements, such as service agreements (which may be referred to as client agreements or consulting agreements), independent contractor agreements (which may be referred to as subcontracting agreements), employment agreements, teaming agreements, purchase and sale agreements, merger agreements, option agreements, license agreements, lease agreements, and the list goes on.

What factors should a small business and startup look for in retaining the services of a lawyer for small businesses?

With our extensive experience of working as a small business attorney in DC for decades now, background and experience should come right at the top of the list when looking for a small business lawyer. We think that accessibility and communication are essential for a successful relationship between an attorney and a client. Hourly rate is important but not as important as quality of service.

What kind of experience do you have in advising small businesses as an attorney?

Keith Rosten has not only legal experience but also business and practical experience that allows him to relate to the trials and tribulations of a small business owner. Keith has BigLaw experience before working for small and medium-sized businesses, first at his own law firm focused on small businesses and then with Berliner Corcoran & Rowe LLP.

Keith has substantial business experience. He received an MBA from the Tuck School at Dartmouth College. During his business studies, he worked on several group projects with small businesses, including a furniture manufacturer, a manufacturer of leak location precision equipment, real estate developer. After business school, Keith operated a successful real estate business in California and overcame numerous issues, such as asbestos abatement and underground storage tank remediation.

Keith worked as a legal adviser to a government contractor and was a legal adviser to a major initiative in Russia. Keith ran another small business, selling and marketing solar energy equipment. The business had an e-tailer component, hosted the largest solar energy forum online, and sold solar energy equipment to the government. Keith negotiated two GSA schedules for the business and obtained HUBZone certification for the business. Keith was also president of the Dartmouth Entrepreneurial Network – Washington, a networking organization for small businesses in the greater Washington, DC community.

Keith has also volunteered for Compass Pro Bono, working with local business professionals to conduct long-term consulting engagements for local nonprofits in fundraising, governance, and strategy.

With this breadth of legal and business experience, Keith is attuned to some of the challenges facing small businesses, which allows him to provide effective advice and guidance.

As a small business lawyer, do you take in-person meetings only?

Yes. We are located in downtown Washington DC and host many of our clients. For those clients who cannot come into our offices, we usually meet over Zoom or by telephone.

How do you charge for your services as a small business attorney?

We charge our clients based on hourly fees. We usually provide a budget of how much certain matters cost so that startups and small businesses know in advance the ballpark cost of the matter.

What if a client does not like our services?

Clients can terminate our services anytime if they don’t find it satisfactory.

Should my small business lawyer or startup lawyer be in the same state as me?

No, not always necessary and may depend on multiple factors. For example, though we are an expert small business lawyer in DC, we have also provided consultation to other cities’ clients.

Substantial Control Under the Corporate Transparency Act

The attacks keep coming at the Corporate Transparency Act. It should not be surprising given that there are over 30 million businesses be affected. The latest constitutional challenge was rejected in a case pending in federal court in Oregon. Firestone, et al. v. Janet Yellen, et al. Case No. 3:24-cv-1034-SI (Sep. 20, 2024) (D. Ore.). The challenges to CTA will likely percolate up to the federal appeals courts and then the U.S. Supreme Court. For now, the CTA marches on with its end of the year deadline for registration. Unless your company is exempt, you need to file a beneficial ownership information report with FinCEN. This article explores who qualifies as a beneficial owner under the Corporate Transparency Act.

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Beneficial ownership

According to the CTA, a beneficial owner is an individual who either directly or indirectly: (1) exercises substantial control over a reporting company, or (2) owns or controls at least 25% of a reporting company’s ownership interests. All individuals who fall under this category must be included in the beneficial ownership report that you must file with FinCEN.

Individual without ownership may be a beneficial owner

Even if an individual doesn’t own one share or one membership unit, that individual can be a beneficial owner under the CTA. If that individual exercises substantial control, the individual is a beneficial owner. How can that be? Substantial control is expansively defined in the CTA. You can be deemed to exercise substantial control if you fall into any of the following categories:

(1) The individual is a senior officer such as the president, CEO, COO, CFO, general counsel, or other officer with a similar function.

(2) The individual has authority to appoint or remove certain officers or a majority of directors of the company.

(3) The individual is an important decision maker for the company. These include but are not limited to decisions regarding the company’s business, finances, and structure.

(4) The individual has any other form of substantial control over the reporting company (catch-all, can be flexible).

How do you know if you are an important decision maker

One of the categories for inclusion on the report is if the individual is an important decision maker. What pray tell is an important decision maker, you are no doubt asking. If you have “substantial influence” over important decisions of the company, you are considered an important decision maker. FinCEN provides some of what important decisions are. The kinds of decisions include:

(1) Business decisions. If you direct or determine certain decisions about the business’ attributes, or select the business lines of the company, or decide the geographical focus of the business you are considered an important decision maker.

(2) Financial decisions. If you decide on the sale or lease or transfer of any principal assets of the business, or make other financing decisions such as approving the annual budget, or compensation for senior officers, you are an important decision maker.

(3) Structural decisions. If you make decisions on the reorganization, dissolution, or merger of the business, or on significant policies or procedures of the company, or on the amendment of the articles of organization, operating agreement or bylaws, you are an important decision maker. Congratulations. You are a beneficial owner and should be included on the beneficial ownership information report.

Examples of indirect control

FinCEN has provided examples on how an individual could exercise indirect control of a reporting company. These include: board representation; ownership or control of a majority of the reporting company’s voting power or voting rights; rights associated with a financing arrangement or interest in the reporting company; control over one or more intermediary entities that separately or collectively exercise substantial control over the reporting company; arrangements or financial or business relationships, whether formal or informal, with other individuals or entities acting as nominees; and the catchall of any other “contract, arrangement, understanding, relationship, or otherwise.”

With regards to the flexible catch-all category of substantial control, FinCEN has provided the following guidance: “A reporting company may also be structured such that multiple individuals exercise essentially equal authority over the entity’s decisions—in which case each individual would likely be considered to have substantial influence over the decisions even though no single individual directs or determines them.”

Exceptions to beneficial ownership

There are five exceptions to the definition of beneficial owner: minor child; nominee, intermediary, custodian or agent; employee; inheritor; creditor. One of the most common of these exceptions is the employee exception. But keep in mind that if the employee is a senior officer, this exception will not apply.

For partnerships, individual partners do not qualify as employees. Since every partner has essentially equal authority over the entity’s decisions and majority vote is required on important decisions, each individual would likely be considered to have substantial influence over the decisions even though no single individual directs or determines them.

A member of a reporting company’s board of directors is not always a beneficial owner of the reporting company. If the member does not directly or indirectly exercise substantial control and does not own or control at least 25% of the ownership interests, then they are not considered beneficial owners even though they are on the board.

Whether a particular director meets any of these criteria is considered on a director-by-director basis, according to FinCEN.

Conclusion

Unfortunately the regulations on beneficial ownership are long and complicated. If you have a question, you should consult a small business lawyer on whether you qualify as a beneficial owner.