Business partnerships can be incredibly productive or incredibly destructive, and the difference usually comes down to two things: the quality of the partnership agreement and the quality of communication between partners.
Most partnership disputes fall into predictable categories. Disagreements over workload (one partner feels they are doing more than their share). Disagreements over direction (partners have different visions for the company). Disagreements over money (how profits are distributed, how expenses are approved, or how much each partner takes in compensation). And exit disputes (one partner wants out, and the terms of departure are unclear or contested).
If you have a well-drafted operating agreement or partnership agreement, most of these disputes have a framework for resolution built in. The agreement should address decision-making authority, profit allocation, compensation, dispute resolution mechanisms, and buyout procedures. When a dispute arises, you start with the agreement.
If you do not have an agreement, or if the agreement does not address the specific issue, you are left negotiating from a weaker position. California default LLC law and partnership law will apply, and those rules may not reflect what you and your partner actually intended.
When a partnership dispute escalates beyond what you can resolve through direct conversation, consider mediation before litigation. A skilled mediator can help partners reach a resolution that preserves the business and the relationship, or at least facilitates a clean separation. Mediation is confidential, less expensive than litigation, and often faster.
If mediation fails and litigation becomes necessary, the most common resolution in a partnership dispute is a buyout: one partner buys the other out, often at a price determined by a business valuation. Having a valuation mechanism in your partnership agreement avoids the expense and uncertainty of litigating the value of the business.
The best time to plan for partnership disputes is before they happen, when everyone is still getting along.
Have questions about partnership disputes? Schedule a free consultation with Newmen Law to discuss your specific situation.
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April 23, 2026
Kaveh Newmen, Esq.
Succession planning is one of those topics that every business owner knows is important but few actually address. The result is that when the time comes, whether planned or unplanned, the transition is chaotic, value is lost, and relationships are strained.
Succession planning answers a simple question: who takes over when you step away, and how? The answer involves legal documents, financial planning, and operational preparation.
Start by identifying your succession scenario. Are you planning to sell the business to a third party? Transfer it to a family member? Promote an internal leader? Merge with another company? Each scenario requires different planning. A sale to a third party requires the business to be positioned for maximum value. A family transfer requires estate planning and possibly a gifting strategy. An internal promotion requires training, equity transition, and often seller financing.
Next, get your business ready to operate without you. This means documenting key processes, ensuring client relationships are not solely dependent on you, building a management team that can make decisions independently, and organizing your financial records so a buyer or successor can understand the business quickly.
From a legal standpoint, your succession plan should include updated operating agreements or shareholder agreements with buy-sell provisions, key person life and disability insurance, an estate plan that addresses business interests, employment agreements with key employees that include retention incentives, and non-compete or non-solicitation agreements where appropriate.
The best time to start succession planning is five to ten years before you plan to exit. The second-best time is now. Businesses that plan their transitions sell for more, transition more smoothly, and create better outcomes for everyone involved.
Have questions about succession planning? Schedule a free consultation with Newmen Law to discuss your specific situation.
April 23, 2026
Kaveh Newmen, Esq.
Unpaid invoices are one of the most frustrating realities of running a business. You did the work, delivered the product, or provided the service, and now the other side is not paying. Here is a practical approach to getting paid.
Start with a direct conversation. Many payment disputes result from misunderstandings, cash flow issues, or simple administrative errors. A phone call asking about the status of payment is often enough to resolve the issue. Keep it professional and document the conversation.
If conversation does not work, send a formal demand letter. A demand letter from your attorney carries significantly more weight than an email from your accounts receivable department. The letter should clearly state the amount owed, the basis for the obligation (reference the contract or invoice), a deadline for payment (typically 10-15 business days), and a statement that you will pursue legal remedies if payment is not received. Most legitimate businesses pay after receiving a well-drafted demand letter.
If the demand letter does not produce payment, you need to evaluate whether litigation is worth pursuing. Consider the amount owed, the likelihood of collection (does the debtor have assets or are they judgment-proof?), and the cost of litigation versus the recovery. For smaller amounts, California small claims court handles claims up to $10,000 (or $5,000 for businesses) with no attorney required.
For larger amounts, a formal lawsuit may be necessary. In many cases, filing the lawsuit itself prompts settlement discussions. The key is to move quickly. Statutes of limitations apply to collection claims, and the longer you wait, the harder collection becomes.
Prevention is always better than collection. Use clear payment terms in your contracts, require deposits or progress payments for large projects, and follow up on overdue invoices immediately rather than letting them age.
Have questions about business collections? Schedule a free consultation with Newmen Law to discuss your specific situation.
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April 23, 2026
Kaveh Newmen, Esq.
As a business owner, you face liability risks that most people do not. Lawsuits from customers, employees, competitors, partners, and regulators are a reality of operating a business. Asset protection planning is about ensuring that a single adverse event does not wipe out everything you have built.
The first line of defense is your business entity. If your business is properly structured as an LLC or corporation and you maintain the separation between your personal and business finances, your personal assets should generally be protected from business liabilities. This is called the corporate veil, and it only works if you respect it. That means maintaining separate bank accounts, not commingling personal and business funds, keeping corporate formalities, and adequately capitalizing the entity.
The second strategy is insurance. General liability, professional liability (errors and omissions), directors and officers (D&O) insurance, and an umbrella policy can cover most claims before they reach your personal assets. Insurance is often the most cost-effective asset protection tool available.
Beyond entity structure and insurance, additional strategies include separating high-risk and low-risk activities into different entities. For example, owning your business real estate in a separate LLC from your operating company means a lawsuit against the operating company cannot reach the real estate.
For personal assets, strategies include homestead exemptions (California provides significant protection for your primary residence), retirement accounts (generally protected from creditors under both federal and California law), and certain trust structures that can provide additional protection.
One important note: asset protection planning must be done before a claim arises. Transferring assets after you know about a potential liability is a fraudulent transfer, which can be reversed by a court and can create additional liability. Plan ahead, not after a lawsuit is filed.
Have questions about asset protection? Schedule a free consultation with Newmen Law to discuss your specific situation.
