I posted a question on HN yesterday asking for clarification on an array of legal issues. They included questions about when to form a company, what type of lawyers to seek, and how to deal with copyright issues. The responses were generally well thought out but varied a lot.

– Form an LLC immediately (it only costs a few hundred dollars) to get some liability coverage. Most recommended talking to a lawyer before you launch, but forming an LLC is better than nothing.

– Definitely seek a lawyer when you start having employees because you’ll have to restructure the company, often to a C corp (need to research)

– For charging money you’ll have Terms and Conditions, which should be created/reviewed by a lawyer

– You produce content it is copyrighted. The little © doesn’t really mean much

– People can take your idea and modify it all they want. There’s not much you can do to stop them

– If you have a partner, make sure you have an Operating Agreement

– The type of lawyer that you look for to help with these things is a Corporate Lawyer

– Forming an LLC is easy; keeping up on the paperwork is hard. Make sure you do it properly

Matt Maroon, a poker player gone entrepreneur via YC threw in his 2c: don’t ask hackers, ask a lawyer. He followed up with an excellent blog post expanding on the idea:

This is dangerous to you, seeker of legal advice, because you’ll be fooled into thinking maybe, just maybe, you can save yourself the retainer. The guy telling you “oh don’t bother to form an LLC, you’re not making a profit yet so you can’t be sued” sounds so confident, surely he must know what he’s talking about. He doesn’t, and you really don’t want to find that out the hard way.

He goes on to explain how the law is difficult to understand and you assume a huge amount of risk by not taking the proper legal precautions. While I agree with him, I think that asking the community has merits too. For me, the question was somewhat of a starting point. None of the posts are a definitive “you should do this” and they couldn’t be, but it still gives me a foundation for future research. The ensuing discussion was filled with smart comments on his article. Some of the best points made included:

– It can be tough to know when it is appropriate to consult a lawyer

– It can cost a lot of $ to consult a lawyer. The benefits might not outweigh the costs. -$EV

– What if the lawyer wants to screw you over and take your money? People responded that most don’t do this because of reputation and they want you to come back in the future, spread the word, etc

– Keep in mind its free advice from nonprofessionals