Samsung's Recent Legal Woes Highlight Opportunities for Smaller Law Firms
Sunday, 09 September 2012 15:32
The recent legal woes experienced by Samsung and Apple in the intellectual property field have highlighted the need to maintain solid control over trademark and patent rights in the business environment. While major corporations are often most at risk for these types of litigation, small to medium-sized businesses can also experience losses from failure to protect their intellectual property rights or from patent or copyright infringement lawsuits filed by competitors. Experts advise that more lawsuits are likely in the near future as companies take note of the sizable settlement awarded to Apple for patent infringements by Samsung.
Emerging opportunities for some
In the wake of these lawsuits, many smaller law firms are focusing on the opportunities available in the trademark and patent field and are looking to expand their services accordingly. Depending on the current staffing available to the company, these legal firms may need to take on additional attorneys and expanded facilities to enter the intellectual property legal field successfully. Additionally, some firms may require added capital resources in order to achieve their business expansion plans. Acquiring the funding needed to achieve these goals can be challenging for smaller law firms. In some cases, it may be advantageous to examine a wide range of loan options in order to maximize the chances of success in the financial marketplace.
Documentation is the key to success
The emergence of numerous new franchise opportunities may be a factor in this scarcity of funds; bank officials may be unfamiliar with these new names in the franchise market and may consider them to be high-risk investments. Lack of collateral can also present significant challenges for first-time purchasers. Many lenders are requiring that borrowers provide a large percentage of the purchase price from savings or other financial assets before they can be approved for financing of the remaining amount. Retirement accounts, marketable securities and other personal property assets can also be used as collateral for franchise purchases in some cases.
Collateral and risk vs. reward
While the rewards available in the intellectual property field can be significant, as evidenced by the $1 billion settlement awarded to Apple, many lenders will require collateralization of these expansion loans in order to ensure their own financial security. While some law firms do own their own offices, those who lease will need to identify other sources of security for their proposed loans. This security may be available in the form of accounts receivable but not yet received, office furnishings and equipment, marketable securities or any other property of significant value. In some cases, investors may be willing to put up the financial resources necessary for expansion based on the business model and proposed increase in income outlined in the loan application. However, this requires an extensively documented and well-supported argument and will likely entail higher interest rates for the life of the loan.
CNF Exchange offers legal firms the in-depth knowledge and expertise to help them present their loan requirements persuasively and to document their financial situation accurately. This comprehensive approach to the lending environment allows small to medium-sized businesses to acquire the necessary funding for their business expansion plans.
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