Legal View: Small business law: Off the beaten path

By Schellene Clendenin
The Daily Record Newswire

Mark Lopez’s independent Portland restaurant, Baja Grill, had been in business for at least two years when he received a cease-and-desist order from a national chain restaurant.

The chain, Baja Fresh Mexican Grill, claimed the name of Lopez’s eatery, along with the red-white-green color scheme he was using for its advertising, violated the larger restaurant’s trademark branding.

Such trademark infringement issues may sound like a rare occurrence for small businesses. But in the realm of unusual problems that mom-and-pop-shop-sized businesses run into, they’re actually quite commonplace, according to Portland-area attorneys Rich Meneghello, a managing partner at Fisher & Phillips, and Scott Phillips, a co-owner of Bridge City Law in Beaverton.

The two attorneys dug deep into their files to find some common and not-so-common issues that business clients have run into in the past.

“It’s amazing to me each day the calls I get from employers and the amazing things people do at work,” Phillips said.

Don’t let the bedbugs bite
Many professionals rack up their fair share of frequent flier miles for overnight business trips. But what if a stay in a hotel for an overnight business included bringing home more than a bottle of shampoo? Stories circulate almost every day about travelers unpacking an invasion of bedbugs along with clothes. If such an invasion can be traced to a hotel, is legal recourse possible?

Yes, both Meneghello and Phillips say. The issue would probably fall under negligence on the part of the hotel. At the very least, a traveler could expect to be reimbursed for the cost of the room, and possibly for the cleaning services used to clear a home of the pests.

“Hospitality clients are (often) concerned with their reputations,” Meneghello said. “Especially in the world information sharing, (those who provide) hospitality services are savvy. They know that if they get in a fight with people on this kind of thing, it could harm them. It’s a balancing act.”

If there is negligence on the part of the hotel, most often the manager will work with the client to come to a mutually beneficial conclusion.

“My best advice is to make contact with them,” Menegehllo said. “Talk to the manager. Work something out with them.”

Raise a glass
A business owner invites a client out for a dinner meeting. The wine flows freely, and by the end of the dinner, the client can barely walk. What is the owner’s legal obligation to make sure the client arrives home safely?

This theme is one Meneghello and Phillips said business clients often ask about, especially during the holidays.

The answer, Phillips said, depends on the situation.

For example, any time a third party is involved, such as a restaurant with professional bartenders serving alcohol, neither the employer nor the client is obligated to regulate drinking or provide a way home.

However, a gray area begins    to creep in when there is no professional bartender involved at an event hosted by the employer somewhere like an office or home. In this type of situation, Meneghello suggests hiring a professional, licensed bartender and instructing that person on drink limits and how to cut people off if they are intoxicated.

“(Then) you are off the hook,” Meneghello said.

What’s in a name?
An architect laid off from a big firm decides to start her own firm. But a couple of months after opening for business, she receives a cease-and-desist letter from the company that claims the catchy name of her firm is too much like theirs. Does the architect have need to worry?

Simply put, yes.

“This touches on business interference,” Meneghello said. He often learns of situations that involve former employees who have gone into business for themselves trying to tap into a former employer’s clients or trying to hire away competent employees. And sometimes the new company interferes with the company the owners left by inappropriately using intellectual property such as client lists, and pricing information — even items downloaded to a flash drive.

Using a name that is similar to a competitor’s, and thereby capitalizing on its reputation, is also illegal, Meneghello said.

That’s the situation Lopez found himself in when he received the cease-and-desist letter from Baja Fresh Mexican Grill. By taking action, however, he was able to write a happy ending for his story. A solution was found that satisfied both parties, and these days Lopez keeps himself busy running a new Portland venture called Crave Catering.