A friend and I started a website with the hopes of selling advertising space and sponsored content. After some time, the partnership went sour and my partner decided to 'unofficially' withdraw his involvement, but it was he who founded the LLC under which the website was initially operating under. However, I current own the domain name and built the current website from the ground up. I plan on moving forward operating under a new business entity.
My question is threefold: (1) are there any foreseeable complications that can arise from this situation?; (2) what constitutes ownership of a website, branding, etc.?; and (3) can these problems be avoided even if I was never "officially" a partner? (i.e. partnership agreement)
1 Answer from Attorneys
These are excellent question and fairly complex.
1) In general there could be foreseeable complications if you do not anchor your separation in a written agreement. For example if you become successful on your own your former partner may want to have a piece of the action, so to speak.
2) ownership is a complex issue. Generally if you owned the domain before you began cooperating with the your former partner then you have a good claim over the domain but your former partner can always claim that you assigned the domain to the LLC. To resolve this and many other issues you need a good separation agreement
3) to be considered a partnership you do not be need to be officially a member of the LLC.
As self serving as it may sound, you need a startup / tech attorney to represent your interests and draft a separation agreement. If you are planning to make money with the site this would be an absolute necessary investment of money and attention on your side.
Feel free to contact my office at your convenience if you need further help. I am located downtown.
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