It was once thought that only large company’s
had to legally protect themselves from would-
be lawsuits. Not true. the same protective
measurements applied to all.
Small businesses are popping up faster
than teenage acne. Everyone is taking their
talents and turning it into cash. Even if you
decide to sell lemonade on your neighborhood
corner, you’d better have a vendor permit and
some decent insurance. Otherwise, it can cost
you.
According to BOLT Insurance, small
business spends $100 billion annually on legal
action and 4x’s as much ($404 million) to set-
tle discrimination related law suits each year.
The entertainment industry is full of
people who take advantage of ‘freedom of
speech’: saying what they want to say. Fol-
lowed by doing what they want to do. Using
that to fuel and ignite questionable behavior in
song lyrics, on stage… sometimes it can be
taken in the wrong way. And sometimes, the
artist truly is insulting and fans aren’t just
fickle. Their offended. And some will sue. Here
are a few ways you can help your small busi-
ness:
BOLTS FIVE WAYS TO PROTECT
YOUR BUSINESS:
1.
NEVER BE SURPRISED. Acknowledge the
possibility of a lawsuit and take steps to pre-
vent it. Work to identify the areas of your
business that are vulnerable as most lawsuits
are preventable with an honest assessment of
your business.
2.
GET EVERYTHING IN WRITING. You can’t
close a deal on a handshake. It must be done
in writing—painstaking as it may be. Details,
such as deadlines and costs, can be fudged
later if it is not in writing.
3.
INVESTIGATE AND DOCUMENT IT. When a
client or employee has a complaint do some-
thing about it! Investigate and document the
investigation. Consult with an attorney to dis-
cuss your findings and weigh the potential for
settlement in a tricky situation.
4.
INVEST NOW RATHER THAN PAYING LATER.
The cost of legal support is not cheap, but it is
ENTERTAINMENT LAW
THINK AGAIN
L
AWSUITS AFFECT
SMALL
BUSINESS
NOVEMBER 2012
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better than a multimillion dollar settlement
later.
5.
BUY INSURANCE. Liability claims costs com-
panies billions every year; liability insurance
can lessen or eliminate the potential for a
massive claim against your small business.
Incorporating your business, copyrighting your
work, or obtaining a trademark, are all excel-
lent steps towards protecting your business,
but it’s not enough. Insurance doesn’t stop
lawsuits, but it does give you added protection
and lowers the cost of lawsuit payouts.
A majority of indie entertainment com-
panies start off as a company of one. While
they might choose to remain a sole proprietor
or incorporate, still they will however copy-
right scripts, documents and other writings
that really are the genetic makeup of their
business. For example, a rap artist may legally
copyright their lyrics or the entire album. A
filmmaker may copyright the idea of a script;
a synopsis. Then copyright the full script be-
fore sending it out to agents. An upcoming
business person has a great idea and needs to
develop a business plan. That budding CEO
may decide to protect their product with a
trademark just in case someone else thinks of
the same idea later on down the line and said
budding CEO now has to prove first use. There
are an array of reasons why businesses have
to constantly protect themselves.
Various types of small business should
consider obtaining insurance. Types of busi-
ness insurance are:
General Liability Insur-
ance
used to cover legal hassles due to an
accident, injuries and other claims of negli-
gence (concerts, video shoots, filming).
Prod-
uct Liability Insurance
is for companies that
manufacture, wholesale, distribute, and retail
a product that may cause safety issues
(
clothing, hair care, makeup).
Professional
Liability Insurance
is for firms and agencies
tht offer a service protecting against malprac-
tice, errors, and negligence (management,
accountants, masseuse). Home-Based Busi-
ness Insurance is a must for those companies
who have not found their way out of the extra
bedroom or basement. It adds on an addition-
al rider to your traditional homeowner’s insur-
ance policy. It can cover such risks from prop-
erty damage (water and electrical damage,
theft from break-ins, tornados and other natu-
ral disasters). By doing a bit of research you
can determine the best course of action your
business should take when buying insurance
for your business. –
Tonisha L. Johnson