Potential conflict Licensing a product?

[B127]

So my question to anyone that can provide some valuable insight is this..
I own shares of a company which is an S corp. I'm the 2nd largest shareholder in the company. The company has a particular product I would like to move forward with on my own because the company doesn't have the time or man power to market it properly. Is there any legal conflict if I start up my own LLC and license the product from the company in which I'm invested in? Any insight would be appreciated, I am ready to move forward but want to be sure I can do so legally before alot of time and resources are put in.
Thanks in advance.

 

[quincy]

So my question to anyone that can provide some valuable insight is this..
I own shares of a company which is an S corp. I'm the 2nd largest shareholder in the company. The company has a particular product I would like to move forward with on my own because the company doesn't have the time or man power to market it properly. Is there any legal conflict if I start up my own LLC and license the product from the company in which I'm invested in? Any insight would be appreciated, I am ready to move forward but want to be sure I can do so legally before alot of time and resources are put in.
Thanks in advance.

What is the name of your state?

What you can and cannot do with the company's product depends on what the company will allow you to do.

 

[B127]

What is the name of your state?

What you can and cannot do with the company's product depends on what the company will allow you to do.

So as long as myself and the company come to a license agreement we can proceed with out any legal conflict of any kind?

 

[quincy]

So as long as myself and the company come to a license agreement we can proceed with out any legal conflict of any kind?

What is the name of your state?

And, no, I didn't really say that.

 

[B127]

What is the name of your state?

And, no, I didn't really say that.

 

[quincy]

State name?

 

[B127]

Lol I'm guessing that was sarcasm? ;-) First time in here, but I do appreciate your reply.

 

[B127]

State name?

I'm in FL and would set the LLC up in FL the S corp I want to license our product is registered in Ohio

 

[Zigner]

I'm in FL and would set the LLC up in FL the S corp I want to license our product is registered in Ohio

It took 8 posts in the thread before you answered the question that was originally posed by the forum software.

 

[B127]

It took 8 posts in the thread before you answered the question that was originally posed by the forum software.

My apologies. . First time user if you couldn't tell. Lol

 

[quincy]

I'm in FL and would set the LLC up in FL the S corp I want to license our product is registered in Ohio

Thank you for providing the names of the states that are involved.

You can have issues if you remain a shareholder, and there can be tax and liability issues.

If you want to start your own company to market a product currently held as an S Corps asset, you will want to sit down with an attorney in your area, this after learning if the S Corps has interest in transferring the product rights to you.

Good luck.

 

[B127]

Thank you for providing the names of the states that are involved.

You can have issues if you remain a shareholder, and there can be tax and liability issues.

If you want to start your own company to market a product currently held as an S Corps asset, you will want to sit down with an attorney in your area, this after learning if the S Corps has interest in transferring the product rights to you.

Good luck.

Thankyou, I appreciate your time and the reply. Again my apologies about not naming the states involved at first. Honest oversite on my part not being familiar with this site and the layout, thread , ect. Sort of thought it was some glitch or something at first. My mistake.
You do have me more concerned now tho and am curious what types of issues there could be by remaining a shareholder in the company that owns the assets I'd like to license? (which I have full intention of remaining a shareholder) The "company" is very small, pretty much a one man show and is stretched thin with other product lines. The one product in particular I would like to license has far to much potential to ignore..

 

[quincy]

An LLC might not be able to hold an ownership interest in an S Corps and, although an S Corps could potentially own an LLC, there are tax issues to consider.

What you might want to do instead of starting your own LLC is to address with the S Corps board of directors what you see as the potential for the product. The company already may have plans in mind for the product.

I recommend you seek a personal review by a business law professional in your area to discuss what you can and can't do as shareholder in the S Corps.

Good luck.

 

[LdiJ]

Thank you for providing the names of the states that are involved.

You can have issues if you remain a shareholder, and there can be tax and liability issues.

What issues do you foresee if there is a proper licensing of the rights to the product, if the OP remains a shareholder of the S-corp? What tax and liability issues do you foresee (outside of the normal ones that go with licensing any product from anyone)?

If you want to start your own company to market a product currently held as an S Corps asset, you will want to sit down with an attorney in your area, this after learning if the S Corps has interest in transferring the product rights to you.

Good luck.

It sounds like the S-corp is already on board. I agree that sitting down with an attorney can helpful, but how helpful depends on how well the OP knows the industry in question.

 

[quincy]

You can read about S Corps in Ohio.

B127 has not said he spoke with anyone at the company about the product or his proposed plan for it.