Law: Critical Business Procedure - Keep All Email Communications

Critical Business Procedure - Keep All Email Communications

Written by Richard A. Chapo

Businesses routinely maintain copies of correspondence and memos. Far to often, however, they do not extend this practice to email correspondence. Email correspondence is no different then your normal paperwork. You must keep copies of all of it to protect your business in any litigation.

Currently, only banks and broker-dealers are obliged to retain e-mail and instant messaging documents for three years under U.S. Securities and Exchange Commission rules. Beginning July 2006, all public companies will also be required to do so under repparttar Sarbanes-Oxley Act.

Notwithstanding these laws, your custom and practice should be to maintain copies of all email correspondence. Email is considered evidence and courts are hammering businesses that do not maintain email records. Judges are often ruling that repparttar 149657 failure to maintain and produce email records means repparttar 149658 business in question is hiding key evidence.

In repparttar 149659 recent Perelman v. Morgan Stanley litigation, a judge’s ruling on repparttar 149660 failure of Morgan Stanley to produce email was key factor in repparttar 149661 issuance of a $1.45 billion verdict. Based on repparttar 149662 failure to produce email records, Judge Elizabeth Maass issued a pretrial ruling that effectively found Morgan Stanley conspired to defraud Perelman in a 1998 deal. Morgan Stanley is not repparttar 149663 only business defendant to have this problem.

Resolve Disputes With Your Partners Before They Happen

Written by Richard A. Chapo

A majority of businesses have ownership groups of less than five individuals. While this provides for efficient and effective management, difficulties arise when something happens to one of repparttar

owners.

If your business has multiple owners, ask yourself what happens if:

· The owners can’t get along?

· One of you is hospitalized for an extended period?

· An owner gets divorced [and repparttar 149656 spouse is awarded half repparttar 149657 shares?]

· An owner stops coming to work?

· You want to sell stock to a third party?

· An owner passes away?

· One of you wants to retire?

Each of these events can severely disrupt your business, particularly ownership disputes. If repparttar 149658 owners can’t agree to a course of action, they often end up in court and a judge may get involved in repparttar 149659 actual running of repparttar 149660 business. Many businesses that were otherwise successful have failed because of such disputes.

How can you avoid these problems?

The best solution is to pursue an agreement between repparttar 149661 parties before there are problems. This agreement, sometimes called a buy-sell agreement, is a contract between repparttar 149662 owners [and their spouses, if any]. The purpose of repparttar 149663 document is to address how disputes, ownership sales and other events will be addressed before they happen. These issues are much easier to deal when emotions are not involved.

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