The High-touch Legal Services® Blog • For Startup Companies

When I prepare to negotiate an agreement for a client, I start by researching the other party so I can gain insights that might help me represent my client more effectively. The obvious starting point is the website for the other party, where I can quickly understand its business and see who its executives are. But I also look for legal information that typically is available only elsewhere.

Every state has a searchable database of the businesses that have registered with that state, either because the business was formed there or because it was formed elsewhere and registered to do business in the state. Each state includes in its database, at a minimum, information about the corporations and limited liability companies. Most states include information about other types of business entities, too.

Finding the search page for a given state is pretty straightforward. A Google search for

[NameOfState] search corporation

usually leads to the right page within two or three clicks. If that approach does not work, the fallback is to go to the state’s homepage, click on “Business”, then look for the business search function.

Sometimes it takes a bit of effort to determine the state where the company is registered. The state where its principal office is located is a logical first guess. If that does not work, I try Delaware. If that does not work and there are no other clues, I fall back on asking the other party’s attorney.

Once the applicable state’s website is found, the record for the company can be pulled up by searching for all or part of the company’s name. Although records vary from state to state, they often contain information such as:

• When the legal entity was formed (provides a clue as to how established the company is)
• Company officers and/or the agent for service of process (may identify and provide the addresses of individuals who control, or otherwise have important roles in, the company)
• The company’s filing number with the state (may be necessary if more-detailed information is sought)
• The company’s status with the state (active, inactive, dissolved, etc.)

I find status information particularly helpful. If it shows that the company is anything other than active and in good standing, I immediately am concerned as to whether my client should be doing business with that company. This situation typically reflects either, or both, of the following problems: The company may have neglected to provide its annual information filing with the state (a simple, inexpensive process, suggesting that the company lacks effective business procedures), or it may have failed to pay its taxes or other state fees (suggesting that the company may be in financial trouble). Either way, I let my client know about the problem so we can build extra protections into the agreement and the business relationship.

I consider this type of research a significant component of properly representing my clients. As the adage says, forewarned is forearmed.

This blog does not provide legal advice and does not create an attorney-client relationship. If you need legal advice, please contact an attorney directly.