Assignment 2 – Business Organization Form and Intellectual Property Rights
You and a close friend at complete your Associate degrees and transfer, finish 4-year University Degrees and go on to graduate school. Your friend becomes a scientist and you become an attorney. (Choose a friend or classmate use their name, and your own name, to complete this assignment.)
Your friend starts a biomedical research business in Los Angeles, and has retained you as her/his new start up company’s business attorney. You have just started your own law firm and doing well with this client could mean your law business’ relatively fast success, or not. (Doing well will also will impact your grade on this assignment). [Your ELAC friend is the business/client. You are their business attorney.]
Name: Your friend’s company will be called “[YOUR FRIEND’S LAST NAME] BIOMEDGEN, [business form designation]”.
Goal: Your friend’s goal is to one day have a thriving bio-medical company that will save peoples’ lives and cure diseases, as well as make him/her very wealthy.
Operations: Your friend’s business will have multiple streams of commerce, and will include:
i. Researching and developing (R&D) new medical devices, instruments and machines;
ii. Manufacture/production of medical instruments and machines (production facilities):
b. Production will include manufacture of medical products invented or owned by other companies,
c. Production overseas or outsourcing to companies in other countries is envisioned by your friend as a possible an option – but your friend knows nothing about international business and is relying on you for business/legal advisement;
iii. Research and developing (R&D) medicines and pharmaceuticals
iv. Manufacture/production of medicines and pharmaceuticals (laboratory facilities)
v. Production will include both the company’s own discoveries (those invented and developed by your friend or his employees), and
vi. Production will include manufacture of medicines and pharmaceuticals discovered or owned by other companies,
vii. Production overseas or outsourcing to companies in other countries is envisioned by your friend as a possible an option – but again, your friend knows nothing about international business and is relying on you for business/legal advisement;
Part A: Business Organization Form (35 points)
Your Business Client’s Interests and Concerns:
· Right now, the business client is just starting up and there is little capital and no assets other than those of the owner (your friend’s intellect and whatever funding he/she can access);
· In the future, the business client wants to “go BIG” and envisions a multinational multimillion-dollar business (consider IPOs on publicly traded stock exchanges);
· The business/client wants to get started right away because he/she has been offered paying short-term business contracts – they are just waiting on you to get them set up;
· The principal owner (your friend) does not mind “sharing” a portion of the business if it is necessary to grow;
· The principal would rather focus on research and development one day, rather than day-to-day management of business functions, but still have ultimate control;
· The principal, also believes if he/she is the one starting the business and taking all the risks of loss (the entrepreneur), then he/she should always be able to have the largest share of rewards from success;
· While the immediate short-term contract projects the business/client has been offered are decent, the business/client will need to raise significant investment capital to realize the long-term growth vision;
· Ultimately, the principal wants to easily be able to “cash out” and retire wealthy one day, but might also want to stay involved in the research just to stay busy (he/she is not sure at this point);
· Your friend does not like paying what he/she considers “unnecessary” taxes.
Since you are the legal expert the principal (your friend) trusts more than anyone else, they have hired you as their business attorney to decide which type of business organization entity form to use for their business.
Your choices for your business client are:
· Sole Proprietorship,
· General Partnership
· Limited Partnership
· Limited Liability Company
In light of your business client’s interests and concerns, discuss the merits of each of these business entity forms, and differentiate between each of these business forms by identifying, describing and distinguishing the characteristics of each, in terms of:
· Method of creation (ease, expense and speed of formation)
· Legal Position and Liability of owners
· Transferability or tradability of ownership interests and raising capital
· Management and control by owner
Question 2 (10 points):
Based on your business client’s interests and concerns, which business entity form would you choose to start his/her business? Assess and discuss why, or why not, would you choose each business form?
(Hint: Review Exhibit 35-4 “Major Business Forms Compared” in the course textbook, and related textbook material.)
Part B: Intellectual Property Rights (15 points)
While doing research in partnership with a laboratory facility located at the USC Medical Center campus your business client has developed a treatment for a new pandemic virus that has arisen. The formula is titled “Serum CA2030”. The Los Angeles County Medical Center Research Corporation (which is a private shareholder investment funded for-profit corporation, and which also receives federal state and county research grants) hired your friend’s company on a contract project basis, and provided the start-up laboratory space, resources and funding for the research and has reserved 50% property interest in anything developed there.
You are the business’ attorney. Your business client wants you to be able to pursue, prosecute and enforce the patent on their behalf. You are to complete a Patent Application for your business client to patent the serum and protect their intellectual property rights.
Go to the United States Patent and Trademark Office website – Provisional Application for Patent webpage: https://www.uspto.gov/patents-getting-started/patent-basics/types-patent-applications/provisional-application-patent
Read the USPTO website page, go to “Patent Forms for Applications Filed On or After September 16, 2012” and locate the following fillable forms:
1) PROVISIONAL APPLICATION FOR PATENT COVER SHEET
2) POWER OF ATTORNEY TO PROSECUTE APPLICATIONS BEFORE THE USPTO
3) CERTIFICATE OF MAILING OR TRANSMISSION UNDER 37 CFR 1.8
Question 3 (15 points):
Correctly and fully complete all three forms and turn in the following:
I) Completed Provisional Application for Patent Cover Sheet
II) Completed Power of Attorney to Prosecute Applications Before the USPTO
III) Completed Certificate of Mailing or Transmission under 37 CFR 1.8
Turn in all your responses by uploading them to the CANVAS site for the course assignment:
1) Turn in your analysis of the business organization forms in light of your business client’s interests and concerns;
2) Turn in your assessment of the choice of business entity form for your business client;
3) Turn in your fully completed forms in PDF format.
Due Date: This assignment is due by 11:59pm, Saturday, December 12, 2020.