Legal Question in Technology Law in New York

Internet Startup

We are in the process of developing an Internet startup firm and have several related questons:

How to about setting up an LLC

How to trademark an logo or company name

How to go about creating a confidentiallity disclaimer

What kind of lawyer do we need to be talking to protect ourselves and our idea and to make our company a real entity?

If anyone has ANYTHING that they think might be useful please feel free to contribute.

Thanks in advance for any help.

Asked on 7/01/99, 2:03 pm

4 Answers from Attorneys

Lawrence Graves Coolidge & Graves PLLC

Re: Internet Startup

Three replies before I could even enter the fray...

1) Gerry Elman is a member of the Global CyberLaw Network (as am I), and has an outstanding grasp of internet law issues. If you think that you have any patentable software, you should definitely consult him. [My firm doesn't do patent work.]

2) Second reply is off the wall -- service marks are just a subspecies of trademark; federal registration is nice but may not fit your budget as a start-up. The real issue is clearing your intended name so you don't wind up putting your efforts behind a name that you later have to abandon because it infringes another trademark. There are two advisable stages: first, fun some searches yourself (I like for this), and if you find nothing then have a trademark search company (I use Thomson & Thomson out of Quincy, Mass.) run a search (roughly $300.00 per search) on the words and logos that you intend to use.

3) Using a firm that can handle both your trademark work and the LLC formation is a good idea. However, no need to go to a huge firm (with the attendant huge fees). More to the point, unless you have already consulted with a competent tax advisor, you need to avoid leaping to the conclusion that you want to be an LLC. Further, a lot of venture capitalists want to invest in corporations rather than LLCs, so if that is on your horizon you might want to use a corporation with a Subchapter S election from the outset.

Confidentiality agreements are usually pretty similar. Most lawyers who deal with high-tech companies will have one.

"What kind of lawyer?" really depends upon how much capital you have backing your start-up. If you are prepared to spend a lot on legal fees, I can recommend a top guy at a NYC firm. If not, you probably want to go with someone outside a major metropolis who has the requisite expertise.

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Answered on 7/09/99, 9:44 am
Bruce Burdick Burdick Law Firm

Re: Internet Startup

You should be speaking with a patent lawyer in a general practice firm. You need to clear the name from trademark conflicts. You need to determine if there are patent problems with what you propose and if you can protect your idea. Patent attorneys have experience with confidentiality issues such as disclaimers, because patent attorneys deal with trade secrets. The use of a patent attorney in a general law firm will provide access to other specialists who can handle the LLC formation, and this will be done all in one place to minimize the number of lawyers you need to deal with.

I have done three of these start-ups, all now LLCs, in the last month so am very familiar with what is needed. That might help you not pay for reinventing the process.

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Answered on 7/08/99, 8:34 pm
Harold M. Weiner Coles & Weiner, P.C.

Re: Internet Startup

1. You can form an LLC with any competent business lawyer. Heck, even we can do it.

2. There is a difference between service mark and trademark. You need to register under the Lanham Act(federal) and the New York State law for full


3. I do not understand your confidentiality disclaimer issue. What are you trying to accomplish?

4. The kind of lawyer you need is an honest one.

None of these problems above are difficult. All require competent legal assistance.

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Answered on 7/08/99, 10:22 pm
Gerry Elman Elman Technology Law, P.C.

Re: Internet Startup

Clearing a trademark: Start at the Patent and Trademark Office Web Site at and do a preliminary search in their database. But beware that it is updated infrequently and doesn't include tools for easily searching for "similar" marks if they don't start with the same letters as the target mark. Weekly updating and a rich set of search tools come with the fee-for-service databases that are subscribed to by attorneys such as ourselves who frequently do trademark work. A secret is that you can file your own trademark application online at the PTO Web Site, but there are frequently some in's and out's that go beyond what the online Wizard tells an applicant. So even if you choose to write your own application via the Web, it's wise to consult a knowledgable attorney and then to include his/her name and address on the application so that any questions get directed there.

Patents: With the spate of patents now issuing on "methods of doing business" it behooves one to follow this subject matter and "clear" a business plan. And if one has a novel and unobvious idea about how to use the Internet, it's wise to file one's own patent application. See for an example of a company that's doing this in spades.

Choosing a lawyer: Yes, it could be good to use someone who's technologically trained and is both a lawyer and a practitioner registered to prosecute patent applications, i.e. a patent attorney. And, yes, I are one, too.

But regardless, may I suggest that you find someone who's Internet savvy and can navigate comfortably in cyberspace. There are a lot of newbies around. Most lawyers by now have finally discovered email. Perhaps you'd want to look for someone who promptly responds to an emailed query.

If any reader of this note would like a copy of an article about lawyers' use of the Internet that appeared in The Philadelphia Lawyer magazine, send me your mailing address.

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Answered on 7/08/99, 10:42 pm

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