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References

"I've been working with patients for almost 10 years as a Chiropractic Physician. I'm always looking for new ways to increase awareness of the valuable clinical services provided at my centers. Bruce Freeman has given me insightful ideas to assist in my marketing efforts. I rely on his 'Ask the Small Business Professor' column to keep me abreast of new trends and developments in the field. I couldn't ask for a more knowledgeable and capable advisor as my companies move forward into providing nationwide healthcare for patients."

Dr. Daniel Houshmand, D.C.

AlternaCare Wellness Centers, LLC

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Dan Janal

President and Founder

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"'Ask the Small Business Professor' is a must read for small business owners looking for free expert business advice. Using a Q&A format, Bruce Freeman covers important small business topics weekly by bringing in recognized experts on subjects including accounting, legal issues, trademarks marketing and sales. Don't miss it!"

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CPA

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Co-Hosts

WTBQ 1110 AM (ABC Affiliate Station)

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APR Principal

Maslowski & Associates Public Relations

Law and the Family Business

Dear Professor Bruce:

I dislike lawyers. What can I do in my business to make sure members of my family will not get into arguments that cause my business to have to pay a lot of legal fees?

Answer:

Disputes among family members in a family owned business can easily cost thousands or even millions of dollars in legal fees, and result incalculable damage to family relationships. Often, separate lawyers may be necessary for the directors, as well as for the business itself.

The need for lawyers is a fact of business life. But a good lawyer to a family business will work with you to suggest ways to anticipate and eliminate problems before they escalate and result in expense and bruised feelings.

Matt Hafter, a principal of Grippo & Elden LLC (a Chicago law firm that represents family businesses in corporate and litigation matters), recommends several tools to head off disputes. These include training family members in communication techniques so disagreements can be aired and resolved. Regular family meetings or reports can help keep family members informed and provide a forum for discussion. Or, the family business can implement agreements requiring the disputes be submitted to non-binding mediation where a neutral professional works with the family to resolve the dispute, and arbitration is an option as well. If a disgruntled family member is also a shareholder, a business may consider buying out the shareholder at a purchase price based on a pre-determined formula.

Each family has different communication styles, but you should consider all of these methods so family members feel they have ways to resolve conflict that do not immediately require a lawyer’s involvement.

But a good lawyer to a family business will work with you to suggest ways to anticipate and eliminate problems before they escalate and result in expense and bruised feelings.