July 29, 2009

Seminar: Doing Business with the Commonwealth

Event/Workshop Title:  Doing Business with the Commonwealth 
Location:  Doylestown 

Address:  252 W. Swamp Road
Doylestown, PA 18901

Event Description:  Free Contracting Workshop for Small Business! Hosted by Economic & Business Development County of Bucks. Workshop topics include:

  • Finding opportunities with the State
  • State contracting procedures
  • State resources for small businesses, and
  • Certification for minority-owned and women-owned businesses
  • Pre-registration required.

To register and to obtain workshop directions, see the contact information listed below.
Date:  6/16/2009 
Start Time: 9:00 AM 
End Time: 12:00 PM 
Contact Name:  Sonia Smith 
Contact Email  business@co.bucks.pa.us 
Contact Phone  (215) 345-3839  
Event Status  Open 
Region  Eastern PA  


Looking for other professional networking events? Please visit our Professional Networking Calendar at www.mckeeoffice.com/calendar.html


Sharmil McKee

Business Attorney



McKee Law Office

245 W. Allens Lane 

Philadelphia, Pa 19119



May 15, 2009

How a member can force a nonprofit to involuntarily dissolve

The Court of Commonwealth issued a ruling in April that should serve as a warning to nonprofit boards in Pennsylvania.   

Did you know that Pennsylvania law allows a member of a nonprofit to petition the court to involuntarily dissolve the nonprofit corporation?  A court will dissolve a nonprofit when the the corporation abandoned its mission, misapplied its assets, when the director act fraudulently, or when the members are deadlocked about the management of the non-profit's affairs.

In Loveless v. Poconos Forest, Mr. Loveless tried to dissolve his nonprofit, Poconos Forest.  The court, eventually ruled in the nonprofits favor, however, it seems the nonprofits only saving grace was the broad language written in the non-profit's bylaws about its purpose and that its directors did not commit fraud.  The main purpose of the nonprofit was to host sporting events, however, the nonprofit had not hosted a sporting event in 19 years. 

Fortunately for the nonprofit, the bylaws broadly states its purpose is to provide vacation facilities for its members.  And while the court found that the directors engaged in self-dealing, the court concluded that the activity did not rise to fraud; the directors conduct fell more along the lines of ignorance, rather than fraud.

The court under these facts refused to dissolve the nonprofit, but the court ruled that the nonprofit must, in the future, conduct all business in strict accordance with its governing documents and all applicable laws.  (Loveless v. Poconos Forest Sportsman Club, No. 2196 C.D. 2008, April 2009).

What can you, as a director of a nonprofit, learn from this case?

1.  Take minutes of all your meetings.

2.  Be sure that each meeting has the required quorum.  If your by-laws do not specify the number, then the Pennsylvania Nonprofit law requires that at least majority of all voting members must be present.  

3.  Follow your bylaws closing when making changes to the by-laws.  If your by-laws do not specify the procedures for amending the by-laws, then the Pennsylvania Nonprofit law first the amendment must be proposed to the board by a resolution.  The proposal must be presented by petition of at least 10% of all voting members.  The amendment must list the existing text of the article with brackets around the language that is to be added.  Once the resolution to petition to amend the by-laws is adopted, then all voting members must be given at least a 10-day written notice

about the meeting to consider the proposed amendment.  The meeting notice must include the proposed amendment.  The proposed amendment may then be adopted by a majority vote of the present quorum. 

Then, finally the Articles of Amendment must be executed by the nonprofit corporation and filed with the Department of State.  The amendment does not become effective until it is filed with the Department of State.

Consult an attorney for more specific information about your nonprofit.  Good luck.

Sharmil McKee
Business Attorney
McKee Law Office
Philadelphia, Pa

May 14, 2009

Hot Issues in Business Law: Patent Trolls

Hot Issues in Business Law

Technology giants have formed a new group to protect themselves from patent trolls.  Patent trolls are businesses who business model is to purchase key intellectual property then collect royalties from companies whose products depend on that intellectual property.  Patent trolls seem to walk a fine line between savvy capitalist and  kidnapper.   

So, technology groups have created a group, Allied Security Trust, that purchases patents in the future.   The Trust then sells the patents to a member after granting itself a nonexclusive usage license.  To join, members pay a $250,000 fee and place $5 million in the Trust's escrow fund.  If I represented a patent troll, the first thing I would do is file an antitrust complaint with the Antitrust Division of the U.S. Department of Justice.  You can file a complaint online at http://www.usdoj.gov/atr/contact/newcase.htm  Keep your eyes open for this storm brewing on the horizon. 

Sharmil McKee
Business Attorney
McKee Law Office
Philadelphia, Pennsylvania
Chat online with a business lawyer, privately, at www.mckeeoffice.com