Welcome to Jahangiri Law Group

Finding out which state to incorporate one’s business is an important step for any company. For many years now, Delaware has been considered the best state to incorporate in. However, recently, California has made strides in exhibiting itself to be a strong environment to start a business. Both states have their pros and cons related to this issue, and each company must make a unique decision tailored to their business on which factors are more important to them. Delaware is known to be extremely legally and economically friendly to businesses, and it is the reason the state houses almost two million businesses. Delaware corporate law is known to be flexible with respect to shareholder rights and company structure (Stripe). It is known to be a merger friendly state and valuable for those investing in venture capital or private equity. Delaware also has its own, unique court called the Court of Chancery dedicated to corporate issues. The Court of Chancery makes decisions only through judges, which are assigned based on merit, and it has been established for many years now (Stripe). Delaware is also known to be a tax friendly state. It does not have income tax for businesses which are based outside of Delaware. In addition, any company that is incorporated in Delaware but does not practice business in the state, does not have to pay the state’s corporate income tax (Stripe). Company shareholders who do not live in Delaware also do not need to pay taxes on their shares. Investors are also more likely to invest in Delaware businesses due to their business and shareholder friendly laws and easy access to incorporation. Despite all these benefits to incorporating in Delaware, there are also a few downsides to doing so. Regardless of whether a business practices in Delaware or not, any company that incorporates there must pay an annual franchise tax which can range from $175 to $200,000 (Stripe). In addition, any company in Delaware that is incorporated but does not practice there, is required to identify as a foreign entity and will therefore be subjected to much more paperwork (Stripe). Finally, Delaware’s corporate laws are known to be advantageous to larger companies but are not friendly toward smaller businesses and startup companies. This may deter some people from starting and incorporating a business in Delaware. Incorporating business in California also has various different benefits. California businesses which do business inside the state are especially at an advantage. This is because local businesses obviously do not need to identify as a foreign entity in California, and therefore they will have to deal with far less paperwork (Stripe). In addition, California businesses have higher credibility and name recognition with distributors, investors, and customers because of the value that California’s market has. Furthermore, California law is also known to shield minority shareholders from unfair or discriminatory practices or treatment (Stripe). Finally, California is well known for startups and innovation, especially in the technology sector centered around Silicon Valley. Many of the corporate laws in California tend to be more favorable towards up-and-coming businesses incorporated in the state. While there are great pros to incorporating in California, there are also some cons which may concern business owners. California has a higher base level of minimum taxes, which is about $800 annually regardless of the company’s income (Stripe). In addition, California is also generally stricter and more scrutable with laws involving privacy, labor, and EPA standards (Stripe). California’s high cost of living and tax laws are also a major deterrent from businesses setting up shop in the state. Overall, both Delaware and California have strong advantages and disadvantages of incorporating a business in each respective state. A business owner must make a choice of where to incorporate based off of factors which are important to them. Delaware is known for flexible corporate laws, the respected Court of Chancery, increased privacy for businesses, and being friendly to investors and large corporations. On the other hand, California corporate law is protective of its employees, highly credible, and better for new businesses and startups. Finding a state to incorporate one’s business is a crucial decision and both Delaware and California are good options. Works Cited Stripe. (2023a, November 29). Incorporating in Delaware vs. California: How to decide. Stripe. https://stripe.com/resources/more/incorporating-in-delaware-vs-california Before you establish your business, it is vital to meet with our legal team. We can discuss your specific situation and any business needs you want to meet. The San Ramon business formation lawyers at Jahangiri Law Group, APC take as much time as is necessary to make sure that you are secure in your decision. JAHANGIRI LAW GROUP handles matters involving contracts (written and oral), trials, arbitrations and appeals in the areas of business, corporate, commercial, and real estate litigation, and transactional law. We offer services to diverse cultures and can assist in Urdu, Hindi, Punjabi and Spanish. We are based in San Ramon, California, but provide services throughout the entire San Francisco Bay Area. We are open from 9:00 a.m. to 5:00 p.m., Monday to Friday. To make an appointment please call 925-574-0100.

AI, otherwise known as artificial intelligence, has taken the entire planet by storm in recent years. It has impacted different economic sectors and career paths, including the legal world. In fact, there are rumblings that AI can be a person’s new legal assistant and can replace attorneys altogether. While AI is an incredibly useful tool, it is still far from becoming a virtual, efficient, and accurate lawyer. As the technologies used in AI continue to develop, the workers in the legal profession, especially in California, are investigating AI and trying to uncover its possible issues, while also attempting to use it effectively and efficiently. While AI is an incredible, versatile online tool, it cannot be blindly trusted for legal knowledge or advice. AI can be used as a starting point for a legal question or topic, but it cannot always be trusted to answer specific or unique legal issues. Many lawyers have claimed that their clients have been misled by legal advice from AI tools, because the advice dispensed from the website did not address the client’s unique circumstances. Attorneys have also complained that while researching a certain topic using AI, the tool has often created its own fictional cases which mistakenly seem to fit within that specific legal topic. If or when AI improves, it may be possible that legal advice from it can be more trusted. Until then, any legal “answers” gathered from AI should be taken with a grain of salt by both the general public and lawyers. Similar to other courts across the country and the world, California courts yearn to learn more about AI and its possible uses in the legal realm. On May 17, 2024, the Chief Justice of California, Patrice Guerrero, led the launch of a brand-new judicial branch task force. The goal for this task force was to examine and weigh any potential benefits and risks of AI in order to assist and protect courts and public citizens. Justice Guerrero emphasized that it was necessary to vet any potential downfalls of AI before completely advocating for it to be used in courts. The branch hopes to emphasize focus on three main points with this new project. Firstly, it hopes to develop a task force on AI which looks into different aspects including court rules, educational programs, legislation, and policies involving both old and new technology. The second goal is to work with the numerous ethics committees in the Supreme Court and create a guide for judicial officers working with ethical dilemmas involving generative AI. Finally, the last goal is to educate the court and judicial workers on the ins and outs of AI, including core information such as its uses, benefits, and potential risks. Members of the task force emphasized that AI could be useful for certain tasks involving management and administration of the court. They also stated that legal research could be done more extensively and efficiently with AI. Another potential benefit is that AI could allow more of the public to have access to legal services that they otherwise may not have been able to have. AI could educate the layperson on court procedures and forms to an adequate level at an efficient pace. However, the final consensus of California courts was that as great as AI could possibly be for the legal world in the future, and that while AI is a legal aid tool at the present, it cannot be a replacement for critically making judicial decisions and creating legislation. In conclusion, AI will continue to develop and be a part of the legal profession for years to come. Despite that, it is unwise at this time to fully trust and depend on AI for legal decisions. This California judicial branch task force focused on AI will help educate the public on AI’s benefits and pitfalls. However, it will likely take some time to gather enough data before making any conclusions on AI’s abilities in the legal world. Until then, the public must wait and use AI sparingly when encountered with a legal problem. Works Cited Corren, B. (2024, May 17). Chief justice creates task force on use of Generative AI in the California Courts. California Courts Newsroom. https://newsroom.courts.ca.gov/news/chief-justice-creates-task-force-use-generative-ai-california-courts JAHANGIRI LAW GROUP handles matters involving contracts (written and oral), trials, arbitrations and appeals in the areas of business, corporate, commercial, and real estate litigation, and transactional law. We offer services in Urdu, Hindi, Punjabi and Spanish. We are based in San Ramon, California, but provide services throughout the entire San Francisco Bay Area. We are open from 9:00 a.m. to 5:00 p.m., Monday to Friday. To make an appointment please call 925-574-0100.

Non-compete agreements have long been a controversial part of employment contracts around employment, especially in California. Essentially, these agreements are clauses in employment contracts which forbid an employee to compete with an employer for a period of time after their employment comes to a close. In addition, this agreement ensures that the employee will not expose any private information that he or she learned while working at the company and generally prevents that employee from starting a similar business or working for a competitor. The attitude and perception of these non-compete agreements in California employment contracts have continued to develop and evolve with the enactment of the new rules. Throughout most of California’s history, the state has generally not allowed agreements which prevent employees from leaving their employer to compete with them in their industry or area. In fact, non-compete agreements in employment are mostly void under Sections 16600, 16601, and 16602.5 of the California Business and Professional Code. The state has emphasized that non-compete agreements are generally too restrictive contractually. In addition, these agreements go against California policies and laws which encourage and promote economic growth, employee freedom, healthy business competition, and employment mobility. California is one of the few states in the country that prohibits almost all non-compete agreements, other than a small number of exceptions. The new laws regarding non-compete agreements are meant to build on what the state already prohibits regarding employment contracts. The two new amendments which were passed on January 1, 2024, S.B. 699 and A.B. 1076, continue to ban almost all non-compete agreements, but they now also allow employees to sue an employer for trying to or actually enforcing a non-compete agreement against them. The extent to which an employee can sue even extends to non-compete agreements which were created in another state. If an employee wins a case involving a non-compete agreement, he or she will be granted recovery for their damages and they are also immune from paying any attorney fees. Furthermore, the amendments require that employers give a written notice to any present or former employees who were employed after January 1, 2022, that any previously signed non-compete agreements are now void. An employer who fails to provide this particular notice may be fined $2,500 per violation. Essentially, these new laws regarding non-compete agreements continue to ban them in California, while also increasing consequences for employers who fail to comply. California’s future regarding employment contracts will be complex, as the state, their employers, and employees attempt to navigate the new, complex non-compete rules and its consequences. Employers now need to be even more careful when drafting employment contracts which are compliant with the law, while also ensuring that the company is not susceptible to losing the privacy of their private employment details and secrets. In addition, more issues and questions may rise regarding non-compete agreements for remote employees or contract workers. While there will continue to be uncertainty surrounding the legal issues of the new non-compete rules, there is confidence that both California policymakers and the state’s workers will find a balance, ensuring continued economic growth for one of the most economically fruitful states in the country. JAHANGIRI LAW GROUP handles matters involving contracts (written and oral), trials and appeals in the areas of business, corporate, commercial, and real estate litigation, and transactional law. We offer services in Urdu, Hindi, Punjabi and Spanish. We are located in San Ramon. We are open from 9:00 a.m. to 5:00 p.m., Monday to Friday. To make an appointment please call 925-574-0100.