Tireless. Kim Lorenz

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СКАЧАТЬ original attorney who helped us set up the new corporation, Pete, agreed to work with us again. He set up a meeting with us to strategize. After our meeting, he agreed that we were not violating Bandag’s international patents as the equipment was sold in a public auction, meaning there was no copyright or patent infringement at the time of purchase. Bandag had allowed the equipment to be sold on the open market.

      As if the impending court date wasn’t threatening enough on its own, it didn’t take long for our competition to hear about the ordeal and use it to their advantage. Since the local Bandag dealers were a part of the suit, word traveled fast around the area. One customer called that very morning, catching us off guard, to say the least. This negative information could seriously cut into sales and customer confidence if they feared we were going to be shut down.

      “I heard your company has been shut down? What’s the deal?”

      We knew that we needed to do some damage control—and fast. Luckily, we had a top-notch attorney on our side. We had no idea how crucial that would be in the long run.

      As we sat in a large federal courthouse with our attorney by our side, I couldn’t help but think of everything that could possibly go wrong. I can’t say either of us had spent much time in a courtroom before this, especially federal court! I hadn’t got much sleep the few nights before, and the stress of it all was wearing heavily as I thought about our employees and how this wasn’t just putting our livelihood on the line—it was theirs, too. I had to remind myself to breathe as I listened intently while a well-polished, New York City attorney pleaded the case of how this little start-up company was causing irreparable harm to an international firm. The attorney went on to share how Bandag had visited many of our biggest customers looking for evidence, fishing for any incriminating information that could be used against us. This was also eroding customer confidence in our firm, as those customers were being interrogated by someone from a highfalutin, New York City attorney’s firm.

      Unfortunately, we had a few customers that expressed concerns regarding the viability of our new business, and one of our larger accounts had already stopped doing business with us as a result of this lawsuit. We also learned that the judge knew of Bandag’s founder, who had passed away a few years earlier. Things looked very bleak indeed.

      Our attorney made the case for our fledgling company, laying out all the reasons he did not believe Bandag had any right to bring suit for patent infringement. The situation seemed like a re-enactment of David and Goliath as we both sat there, completely helpless. Our whole future, our whole lives, hung there in suspense for what seemed like an eternity that day.

      Though the judge ruled against the injunction, it wasn’t the end of the road for us. Bandag was not able to shut down our operations yet, but they weren’t going to give up without a fight. Even though we were still able to run our business, we had the constant threat of financial ruin looming over our heads. Bandag would file other injunctions, interview other customers, and make our lives very miserable for a long time to come. It was an obstacle we had never expected. Our employees were wondering if we could still pay them and keep them employed. Customers were questioning if we would still be in business.

      The following year, Bandag filed an injunction appeal but failed again. Even though we were successful in defending the lawsuit, the financial burden of attorney fees looked like it could be our demise. It was hard to see if there was a light at the end of this tunnel, and if there was, it might be a locomotive ready to crush us.

      While all this lawsuit business was going on, at 3:00 AM on a cool, wet, Seattle-type, gray October day, my wife and I welcomed our third child into the world. Feeling both euphoric and exhausted, I remembered I hadn’t checked my messages all day since we had been at the hospital. Still, no cell phones or text messages then. I picked up the phone and dialed my voicemail.

      “Hey, Kim! It’s John. I know you’ve probably had a long day, but Pete needs us at the office at 8:00 AM sharp tomorrow. It’s gotta be important. See you there.” Tomorrow was now today, this morning, just a few hours after Jill gave birth to our third boy (Jill needed a girl, but that was never meant to be).

      I maybe slept about an hour before it was time to head over to Pete’s to see what all the fuss was about. Imagine my surprise when I walked in to see the Bandag attorneys! They made the trip to Seattle as Bandag management had decided they wanted to settle the case that morning, out of court. John and I knew that our key witness had totally refuted what the Bandag attorneys thought was their best opportunity to win. Still, it seemed a bit odd that all of a sudden, they wanted to settle the case. We both knew the basis for the suit was weak by this time, and Bandag had poor odds, but we would not know the real reason for the fast settlement until a few years later.

      Regardless of what was to come, the real victory was this: that morning, the attorneys for Bandag dropped the suit for a very small sum, which was to be paid over the next year. Suddenly, it was as if the anvils we were carrying on our shoulders were gone. We were finally free to grow and build our business further while shedding the awful burden of a federal lawsuit and possible demise. Though we are now thankful for the opportunity to learn and grow through that painstaking process, it was certainly an expensive lesson to learn! We were grateful for the hard-working employees who stayed with us through the whole ordeal, as well as many customers.

      On the other hand, we had run up over $100,000 in attorney’s fees, and Pete knew we did not have the resources to pay him at that time. He had held most all his fees over that whole year, never billing us. He generously offered that we could have the next couple of years to pay him in installments, with no interest. I still get a little choked up by his generosity. Not only did Pete save our business, but he was a true friend to us. I can’t say I know many attorneys who would be so kind.

      Thankfully, we eventually gained back the customers we had lost and continued to take larger percentages of the market. We were back in full-charge mode and growing again, gaining back what we lost and more.

      During the lawsuit process, the world had seemingly stopped around us. It felt as if there were an eerie, dark cloud that rendered any thought or focus on the future an impossible task. Every day we woke up thinking, “This could be the day we get shut down for good.” But the light at the end of the tunnel finally came, and it was not the train! The sun instantly pierced through the clouds, exposing hope for the future once again. Just think, I had gotten the gift of a brand-new baby and a settled lawsuit on the same day! The future was certainly looking bright.

      The company that was suing us, Bandag, called ten years later, asking that we start doing business with them. There were some interesting negotiations regarding that step in our business. We eventually became one of their largest dealers in North America, operating four large Bandag manufacturing plants! How that all happened is an example of why it’s important to be open-minded, professional, and able to look at mutually beneficial opportunities all the time. This book will focus on decisions and choices, self-discipline, and how we deal with the 35,000 or so choices we are confronted with every day. Some of them carry long-lasting consequences that can affect the rest of our lives, so we always want to choose wisely. In our case, becoming a Franchise Dealer for Bandag was a great decision for both companies.

      Chapter 5

      Potential Pitfalls of Partnership

      A business partnership is defined as the following: a closely held corporation with two or more managing shareholders.

      Any business with two or more owners can be a Limited Liability Company (LLC), a fully incorporated entity, a simple partnership, or any relationship where two or more share responsibility to manage the entity. As the managing shareholders, each assumes the financial risk, and it is important to ensure they have a way to agree when СКАЧАТЬ