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The Different Types of LLCs

Starting a business in California? You need to be sure that you select the right legal entity. Companies need the best foundation in order to thrive. A limited liability company (LLC) offers several potential advantages. Lynnette Ariathurai is a Fremont business formation attorney who has experience with the full range of LLCs. We can help you find the right one for your company. In this article, you will find an overview of the different types of LLCs in California.

What is a Limited Liability Company (LLC)?

The California Franchise Tax Board explains that an LLC is “a business entity that blends partnership and corporate structures.” It is a business structure that offers favorable liability protection while offering the tax flexibility and relative ease of formation of a partnership or sole proprietorship. In California, LLCs are created by filing Articles of Organization with the Secretary of State. The owners of an LLC are called members. A key advantage is that they are generally not personally liable for the company’s debts or legal obligations. Still, LLCs must comply with specific requirements in the state, including paying an annual franchise tax and filing regular reports.

An Overview of the Three Types of LLCs in California

Single-member LLCs

The most straightforward type of LLC in California is a single-member LLC. It only has one owner (member), but it still offers full personal liability protection while keeping management and tax filing relatively simple. It is a popular choice for solo entrepreneurs, consultants, or freelancers who want legal separation between personal and business assets. The member can elect to be taxed as a sole proprietorship (more common) or corporation (an option). To be clear, there is no need to divide decision-making. The single owner retains full control over daily operations of the business.

Single-member LLCs must still comply with California’s annual franchise tax and filing obligations.

Multi-member LLCs

Multiple parties can own and operate an LLC in California. A multi-member LLC is a company that has two or more owners. Multi-member LLCs offer a collaborative ownership structure with shared responsibilities. This may be the right entity for businesses with multiple partners. Each member has an ownership interest. The LLC will allocate profits, losses, and responsibilities according to an operating agreement. Multi-member LLCs should have a professionally drafted operating agreement. Most multi-member LLCs are taxed as a partnership. With that being said, corporate tax treatment is an option. It provides limited liability for all members. That means that personal assets are protected from business liabilities.

Manager-managed LLCs

Finally, in California, a manager-managed LLC is a type of LLC where the members (owners) designate one or more managers to handle day-to-day business operations. That manager may or may not actually be one of the members. The model is ideal when investors want limited involvement in management or when the business needs professional management. Members retain ownership rights but delegate operational control. That can help to streamline decision-making. Of course, non-manager members must put a great deal of trust into the people who oversee day-to-day business operations. Notably, California allows both member-managers and non-member managers.

Contact Our California Business Formation Lawyer for LLCs Today

Lynnette Ariathurai is a California business formation lawyer who provides solutions-focused guidance and support to clients. If you have any questions about the different types of LLCs, please do not hesitate to contact us today for a fully confidential consultation. With an office in Fremont, we provide business formation services throughout the Bay Area.

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When to Create a C Corp

Choosing the right business structure can have major implications for taxes, liability, and long-term growth. A C corporation offers distinct advantages. At the same time, they can be complicated and costly to set up, so it is certainly not the right option for every situation. Here, our Fremont business formation lawyer provides a guide to C corporations, including an explanation of the structure, the advantages and disadvantages, and examples of when to create one.

What is a C Corporation?

A C corporation (C corp) is a legal business structure that is wholly separate and distinct from its owners. It is the most common type of corporation in the United States. A C corp can enter into contracts, own assets, sue and be sued, and is taxed independently of its owners. One key feature is that profits are taxed at the corporate level and again at the shareholder level when distributed as dividends. Indeed, the California Franchise Tax Board explains that a C corp pays taxes on its earnings directly. The shareholders of the C corp are taxed separately from the business.

Know the Advantages and Disadvantages of a C Corp

The Benefits of a C Corp

As a C corp is a fully distinct legal entity, it offers very strong liability protection. Shareholders are shielded from personal responsibility for business debts and lawsuits. Further, a C corp also allows for unlimited shareholders. That makes it an attractive structure for raising capital and attracting investors. C Corps can also issue multiple classes of stock. The flexibility in ownership and fundraising makes them a great business entity for companies that have massive growth potential.

The Drawbacks of C Corp

C corps are not right for every situation. One major drawback of a C Corp is double taxation. Remember, the profits are taxed at both the corporate level and again when distributed to shareholders as dividends. C Corps also face extensive recordkeeping, regulatory compliance, and reporting requirements. That can increase the start-up costs and administrative costs.

Examples of When to Create a C Corp in California

You Plan to Raise Venture Capital

Most venture capital firms require investment in a C corporation because it allows for preferred stock and scalable equity structures. Forming a C corp in California positions your business to raise money from outside investors.

You Intend to Go Public in the Future

C corps are the required structure for companies that want to file an initial public offering (IPO). Establishing a C corp early helps to position a business for going public.

You Want to Offer Stock Options to Employees

C corps can issue stock options and other equity incentives that are attractive to top talent. It is a significant benefit because it can make it easier to recruit and retain employees in California’s competitive business environment.

You Anticipate Substantial Profits That Will Be Reinvested

A downside of a C corp is that it is subject to double taxation. However, an advantage of being taxed separately from their owners is that these businesses can reinvest profits without immediate tax consequences for shareholders. It is a strategy that can help grow the company.

Contact Our California Business Formation Lawyer for C Corps Today

Lynnette Ariathurai is a California business formation attorney who has the knowledge and experience that companies can trust. If you have any questions about creating a C corporation, we are here to help. Contact us today for a strictly confidential consultation. From our Fremont office, our firm works closely with C corps throughout the Bay Area.

When to Create an S-Corp for Your Business?

Are you building or transitioning a business in California? You may be considering structuring it as an S-corporation (S-corp). S-corps can be great businesses—but they are not the right choice for every situation. You need the proper business entity. Here, our Fremont business formation lawyer provides a comprehensive guide for when to create an S-corp in California.

What is an S-Corporation?

The California Franchise Tax Board explains that an S-corp is “a corporation that elects to be taxed as a pass-through entity.” Technically speaking, an S corp is not itself a type of business entity but rather a tax election that eligible corporations can make with the Internal Revenue Service (IRS). When a California corporation (or qualified LLC) elects S corp status, it becomes a pass-through entity for federal tax purposes. That means that profits and losses “pass through” to shareholders and are reported on their personal tax returns.

When to Create an S-Corporation in California

Choosing to operate as an S corporation can be financially advantageous—but only in the right circumstances. For it to be the best choice, you have to qualify for S-corp status and there must be tangible benefits to making the election. The S-corp structure is typically best suited for businesses that have:

Steady profits
All owners are U.S. citizens or green card holders and reside in U.S.
Have overhead expenses, ie: hold inventory, lease commercial space, own valuable assets, etc. and desire tax benefits.

In California, S corps must first be formed as a corporation (or LLC) and then file Form 2553 with the IRS. Beyond that, California imposes an annual franchise tax of either $800 or 1.5 percent of net income—whichever one is greater.

Business law tip: The timing of the S corp election is important. Businesses expecting to generate substantial net income—particularly when the owner is actively working in the business—often benefit most. If your business is just launching or not yet turning a consistent profit, the costs and compliance requirements of S corp status may outweigh the tax advantages

Examples of Businesses that Work Well as S-Corps

Professional Services Firms

Accountants, architects, and marketing agencies with high profits and low overhead can use S corp status to reduce self-employment taxes.

Consulting and IT Businesses

Solo consultants or firms with a few employees may find S corp tax treatment efficient once income exceeds a certain threshold.

Marketing and Creative Agencies

These service-based businesses often generate stable revenue and have minimal overhead. For that reason, they can sometimes be ideal candidates for the tax advantages of S corp status.

Every Case is Different: Speak to a Business Formation Lawyer

While S corporation status certainly offers key tax advantages, it is not suitable for every business model. An experienced California business formation lawyer can help you weigh the pros and cons of creating an s corp based on your earnings, industry, and your long-term goals.

Contact Our California Business Attorney for S-Corps Today

Lynnette Ariathurai is a California business formation attorney with the skills and experience to handle S-corps. If you have any questions or concerns about forming an S-corp, we are here to help. Contact us today for a completely confidential, no obligation consultation. From our Fremont office, we handle S-corporation formation throughout the Bay Area.

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When & Why to Create an LLC for Your Business

Are you preparing to start a business in the Bay Area? You may be considering forming a limited liability company (LLC). LLCs offer a number of advantages—but they are not the right option for every situation. Here, our Fremont business formation attorney highlights key things to know about when to create an LLC in California.

What is a Limited Liability Company (LLC)?

The California Franchise Tax Board explains that an LLC “blends partnership and corporate structures.” An LLC offers its owners—called “members” in California—personal liability protection. That means that they are generally not personally responsible for business debts and legal obligations. At the same time, an LLC allows for pass-through taxation. The profits and losses are reported on the members’ personal tax returns.

When to Create an LLC in California

An LLC is one of the most popular business entities in California. Deciding when to form an LLC always depends on the specific goals and risks associated with your business. Here are some of the most notable reasons why it might be the right choice to create an LLC:

You need liability protection: An LLC is a smart choice when you want to protect your personal assets from liability. If your business involves customers, clients, or contracts—or you have employees, equipment, or significant financial exposure—an LLC can shield your home, personal bank accounts, and other assets.
You want ownership clarity: Another good time to form an LLC is when you are entering into a business arrangement with another party. An LLC allows multiple owners to clearly define ownership shares, profit distribution, and decision-making authority. It can be all within an operating agreement.
You prefer a simplified start-up: In comparison to some other business entities that offer liability protection—most notably, traditional C-corporations—LLCs are faster and less expensive to set up. The simplified creation process is a significant advantage.

Examples of Businesses that Work Well as LLCs

Freelance Services and Consulting Services

Independent consultants, designers, or marketing professionals often choose LLCs to separate their personal assets from business risk all while retaining tax flexibility.

Real Estate Investment and Property Management

Real estate investors commonly use LLCs to hold properties and reduce personal liability for tenant issues or property-related claims.

Retail Businesses and E-commerce Businesses

Whether operating a local boutique or an online shop, retail businesses benefit from the liability shield of an LLC and its flexible tax options.

Every Situation is Different: Consult With a Business Formation Lawyer

An LLC may or may not be the right business structure for your specific situation. Every situation involves its own set of facts and circumstances. Your needs and your long-term objectives matter. A business formation lawyer with experience setting up LLCs can help.

Contact Our California Business Lawyer for LLCs Today

Lynnette Ariathurai is a California business formation attorney who has extensive experience helping clients form LLCs. If you have any questions about when to create an LLC, we are here to help. Contact us today for a fully confidential consultation. With an office in Fremont, we handle LLC formation throughout the Bay Area.

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Legal Services for Medical Practices from Formation through Sale

For physicians, owning and operating their own professional practice can be a great opportunity. At the same time, it is complicated. California physicians face unique challenges throughout the lifecycle of a medical practice. As a small business owner and a California business attorney, Lynnette Ariathurai provides solutions-driven representation to medical practices. Here, our Bay Area business lawyer provides an overview of key things medical practices need to know about business law—from open to close.

Forming a Medical Practice

Starting a medical practice in California requires strict compliance with the state’s professional corporation rules. Physicians must form a Medical Corporation under the Moscone-Knox Professional Corporation Act. A key element of the law is that it only allows licensed professionals to own shares and serve as officers or directors. You will also need to obtain a federal employee identification number (EIN) and provide the registration to the California Medical Board.

Buying a Medical Practice

You may be considering buying a medical practice in California. There are options for structuring the purchase agreement. You could buy the entire medical practice—which means acquiring all assets, liabilities, and operational responsibilities. Alternatively, you could complete an asset purchase. That involves selecting specific assets to acquire—and it can allow you to avoid taking on most of the practice’s liabilities. However, the downside of an asset purchase is that you may lose access to contracts/licenses that could otherwise be transferable through purchasing the whole business.

Structuring a Medical Practice (Compensation for Physicians)

When you set up a medical practice, one of the biggest questions about structure is how the physicians will be compensated. Notably, the fee-splitting laws for physicians in California are strictly enforced. Our state prohibits physicians from engaging in fee-splitting arrangements with non-licensed individuals or entities, particularly when compensation is tied to patient referrals. A violation of the law can result in severe penalties, including fines and even potential suspension or revocation of the professional corporation’s registration. Medical practices must ensure that compensation structures are based on legitimate services rendered, not on the volume of referrals.

Selling a Medical Practice

Selling a medical practice in California is complicated. When doing so, it is crucial that you ensure transparency by accurately disclosing the practice’s financial status to potential buyers, informing active patients about the sale in advance, and properly transferring patient records, which requires explicit consent to comply with HIPAA regulations. A California business lawyer can help you draft a comprehensive sale agreement and notify the California Medical Board of changes in ownership.

Closing a Medical Practice

Preparing to wind down your medical practice? Shutting down a medical practice involves more than simply ending operations—it is a highly regulated process and physicians have clear legal duties. To start, you must give patients adequate written notice, provide them access to their medical records, and ensure continuity of care during the transition. California law also requires retaining patient records for a set period—usually at least seven years. Physicians must also be prepared to notify all relevant agencies and properly dispose of any controlled substances.

Contact Our California Business Lawyer for Medical Practices to Today

Lynnette Ariathurai is a California business attorney with extensive experience working with medical practices. We advise physicians on the full range of business matters related to their medical practice—from open to close. Contact us today for your fully confidential, no obligation initial consultation. With an office in Fremont, we serve clients throughout the Bay Area.

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Buying a Medical Practice in California? Know the Difference Between Purchasing the Business and Purchasing the Assets

The California Health Care Foundation reports that approximately 75,000 physicians are in active practice in our state. Are you a doctor who is considering buying a group medical practice? It is crucial that you ensure the transaction is structured properly. You could buy the entire business or, potentially, you could purchase its assets. Here, our California business law attorney explains the key points to understand about the differences between purchasing the company and purchasing the company’s assets.

What Does it Mean to Purchase a Business?

Purchasing a business means acquiring the entire company, including all its assets, liabilities, and operational responsibilities. As the buyer, you effectively step into the shoes of the previous owner. You get the medical practice and its existing contracts, but you also take on its debts, and legal obligations. Comprehensive due diligence is especially important when buying an entire medical practice.

What Does it Mean to Purchase the Assets of a Business?

Purchasing the assets of a business involves buying specific assets without acquiring the company itself. In an asset purchase, you select which assets to acquire—such as medical equipment, patient relationships, and intellectual property—while generally avoiding the company’s liabilities. However, you cannot assume the company’s contracts or the goodwill it has built.

Choosing the Best Option for Buying a Medical Practice in California

Pros of Buying a Business

Seamless transition: Acquiring the entire business allows for uninterrupted operations, minimizing disruptions for patients and staff.
Retention of contracts: Existing agreements—such as insurance provider contracts and leases—run with the business itself.
Established reputation: Goodwill matters. You inherit the practice’s brand identity and patient goodwill.

Cons of Buying a Business

Assumption of liabilities: You take on all the business’s debts and legal obligations, including any undisclosed or contingent liabilities.
Complex due diligence: Thorough investigation is required to uncover financial, legal, and regulatory issues, which can be time-consuming and costly.
Regulatory compliance challenges: Navigating California’s healthcare regulations for ownership transfer can be complex.

Pros of Buying the Assets of a Business

Selective acquisition: You can choose specific assets to purchase, allowing you to exclude unwanted equipment or obligations.
Reduce liability risk: As a rule, you can avoid assuming the seller’s liabilities, reducing your exposure to potential legal and financial risks.

Cons of Buying the Assets of a Business

Operational disruption: Transferring assets may necessitate re-establishing contracts, obtaining new licenses, and renegotiating insurance provider agreements.
Patient continuity concerns: You may face major challenges in retaining patients, as transferring medical records requires patient consent under privacy laws.

Speak to Our California Business Lawyer Today

Lynnette Ariathurai is a business attorney with extensive experience working with owners of medical practices. If you are considering buying a medical practice, we are here to help. Call us now or contact us online to arrange your confidential, no obligation consultation. From our Fremont office, our firm works with medical practices throughout the Bay Area.

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What to Know About the Upcoming BOIR Federal Filing Deadline in California

On January 1st, 2021, the Corporate Transparency Act was signed into law. The law official took effect on January 1st, 2024. Notably, it requires existing entities—companies that existed prior to 2024—to file their initial BOIR (Beneficial Ownership Information Report) by January 1st, 2025. An important deadline is approaching. It is crucial that business owners in California are prepared. In this article, our California business lawyer provides a comprehensive overview of the key things to know about the upcoming BOIR federal filing deadlines.

What is a BOIR Filing?

As explained by the Financial Crimes Enforcement Network (FinCEN), a Beneficial Ownership Information Report (BOIR) is a filing mandated by new federal law (the Corporate Transparency Act.) It requires certain corporations, limited liability companies (LLCs), and similar entities to disclose information about individuals who directly or indirectly own or control them. The report includes details such as the beneficial owner’s name, date of birth, address, and identification number from an acceptable document like a driver’s license or passport. The initiative aims to enhance transparency and combat illicit financial activities by preventing the misuse of shell companies.

Access to the form: Beneficial Ownership Information Report (BOIR)

Who Needs to File and Why?

The new rule requires entities that file articles of incorporation or articles of organization—or the equivalent—with any state secretary of state to register beneficial ownership information with FinCEN. A “beneficial owner” is defined as anyone who owns 25 percent or more of the company or has significant control as a decision-maker. Documentation needs vary:

U.S. citizens/green card holders: State-issued driver’s license or U.S. passport.
Foreign citizens: Valid documentation from their home country.
Entity owners: Appropriate ownership documentation for each company.

Know the Filing Deadlines and the Penalties

The deadlines for compliance depend on when your entity was formed:

Entities created before December 31, 2023: Must file by December 31, 2024.
Entities formed on or after January 1, 2024: Must file within 90 days of formation.
Entities formed on or after January 1, 2025: Must file within 30 days of formation.

What are the penalties for a BOIR violation? Noncompliance carries steep financial sanctions: $500 per day. You can avoid these fines with a timely, accurate filing.

We Handle BOIR Compliance for Companies in California

Navigating these requirements can be complex—especially since BOIR requirements are new to business owners. You do not have to handle the filing on your own. Lynnette Ariathurai can help. Attorney Ariathurai will ensure your compliance with federal law. Among other things, this includes determining whether your entity qualifies for an exemption, clarifying beneficial ownership criteria, and submitting an accurate, properly supported BOIR filing for your business entity.

Get Help From Our California Business Law Attorney Today

Lynnette Ariathurai is a top business attorney. If you have any questions about the BOIR federal filing requirements, we are here to help. Call us now or contact us online for a confidential consultation. With an office in Fremont, our firm represents businesses throughout the Bay Area.

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Considerations When Buying a Veterinarian Practice

Are you considering purchasing a veterinary practice in California? Whether you are looking to take over that practice or you are interested in merging with an existing veterinary practice, it is crucial that you take a proactive approach. Lynnette Ariathurai is committed to providing solutions-focused business law services to veterinarians. Here, our Fremont business lawyer for veterinarians highlights considerations to keep in mind when buying a practice in California.

Know How to Structure the Purchase Agreement

One of the first considerations when buying a veterinary practice in California is determining how to structure the business. Broadly speaking, buyers and sellers have two main options available:

Stock purchase: A stock sale involves buying the seller’s shares, resulting in the full and outright ownership of the entire business—including both its assets and liabilities.
Asset purchase: An asset sale involves buying individual assets of the practice, such as equipment or client lists. It does involve buying the entire professional practice.

Put a Strong Emphasis on Due Diligence

Before purchasing a veterinarian practice in California, it is crucial that you conduct thorough due diligence. Due diligence is the comprehensive appraisal of a business undertaken by a prospective buyer to evaluate its assets, liabilities, and commercial potential. Some key issues that should be addressed during the due diligence process include:

Location: An office lease for veterinarians is a very important issue. You should evaluate the practice’s location to determine its potential for growth and accessibility.
Licensure: Veterinary practice is highly regulated. You should have a full understanding of the requirements of theCalifornia Veterinary Medicine Practice Act.
Liabilities: You need to know what are the taxes owed, what existing contracts are in place, and any potential claims against the practice—from an employee or otherwise after closing.
Equipment: What type of equipment comes with the practice? Be sure to inspect the condition and value of the equipment to ensure it meets modern veterinary standards.
Employees: Human capital matters. Potential buyers should review employee contracts and qualifications to understand the team’s stability and expertise.
Clients: Finally, you should assess the vet’s client base to gauge loyalty, satisfaction, and the potential for future business growth.

Prepare for Operating a Veterinary Practice

Acquiring a vet practice in California is a complicated endeavor. Setting yourself up for success goes beyond the purchase agreement and due diligence. Prospective vet practice owners should be ready to manage legal requirements, operational logistics, and client relations. Some key considerations to prepare for the operation of a veterinary practice include:

The Transfer of an existing license in compliance with the California Veterinary Medicine Practice Act;
The Transfer of key vendor, customer, leases and other contracts necessary to operate the practice;
A decision on which employees to retain, including their compensation and benefits; and
A timely notice to clients and their consent to transfer of pet medical records in compliance with all applicable laws and regulations in California.

By addressing these key areas and other legal matters, you will lay the groundwork for a strong transition. Proactively managing licensing, contracts, and personnel matters help to ensure operational continuity. Beyond that, clear communication with clients about changes can help you keep them satisfied with the business. An attorney can help you prepare for operations.

Get Help from Our California Business Attorney for Veterinary Practices Today

Lynnette Ariathurai is a business lawyer with extensive experience working with veterinarians. If you have any questions about the process for buying a veterinary practice, we are here to help. Call us now or contact us online to arrange your strictly confidential consultation. From our Fremont office, we provide business services to veterinary practices throughout the Bay Area.

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Legal Needs in Setting Up a Successful Nursing Company in California

Nursing is one of the most high-demand professions in the Bay Area. CalMatters estimates that there is currently a shortage of 36,000 nurses in our state—and that number is growing. If you are considering setting up your own nursing company in California to help address the need, it is imperative that you have the right structure in place. Here, our Fremont business law attorney discusses your legal needs when setting up a successful nursing company in California.

A California Nursing Business Needs a Strong Legal Foundation

Nurses are licensed, regulated professionals and a nursing company must be established with the proper legal structure. Notably, in California you cannot form a nursing business as a limited liability company (LLC), a partnership, or a corporation. Instead, you must form a Nursing Professional Corporation. You may hear this referred to as a PC.

A PC for nursing is a specialized type of entity that allows registered nurses (RNs) to provide their professional services through a corporation structure. It offers some key advantages, including liability protection and the ability to elect to be taxed as an S-corporation (pass-through taxation). Several types of medical professionals may own a stake in a nursing business in California. However, licensed nurses must always have a minimum 51 percent total ownership share.

Requirements to Form a Professional Nursing Corporation in California

A group nursing business will generally be set up as a PC in California. There are specific legal requirements that must be met to form a valid professional nursing corporation. More specifically, you and any co-owners in the nursing company must be sure to do the following:

Select a name (which must include “nursing”)
Draft and file articles of incorporation
Develop corporate bylaws for the PC
Register the PC with the Nursing Board

Developing the Right Strategy for a Successful Business in the Nursing Field

Meeting the basic legal requirements to set up a PC for a nursing company in California is certainly not sufficient to build a successful business. You need a comprehensive strategy. Here are other important legal/business issues that must be addressed when forming a nursing PC:

Ensure that you and any partners have the right ownership structure in place
Develop a compensation plan for your nursing PC
Secure and Employer Identification Number (EIN) from the IRS
Obtain adequate professional liability insurance coverage
Consider what types of contracts your PC will need to draft/enter
Proactively comply with all regulations from the California Board of Registered Nursing
Consider tax implications (may be taxed as S-corporation or C-corporation)

Contact Our Bay Area Business Attorney for Nursing Companies Today

Lynnette Ariathurai is a business lawyer with more than three decades of experience. If you have any questions about the legal needs of a nursing company in California, we are here as a resource. Call us now or contact us online for your confidential initial appointment. With an office in Fremont, we provide business law services to nursing companies throughout the Bay Area.

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Veterinarian Malpractice (Holding Vets Accountable for Professional Negligence)

As licensed professionals in California, veterinarians can be held liable for malpractice. It is a risk that needs to be considered along with the range of different considerations that need to be addressed—from the compensation structure to an office lease to making preparations for defending the business when something might go wrong. Within this article, our Bay Area business attorney for veterinarians highlights key points business owners should know about professional malpractice claims—and your options to protect your practice—in California.

What is Veterinary Malpractice?

Veterinary malpractice occurs when a veterinary professional fails to provide the standard of care expected in the treatment of an animal, leading to injury, worsening of a medical condition, or even death. Some of the most common examples of veterinary malpractice include misdiagnosis, incorrect treatment, rough handling of a pet, and negligence in surgical procedures.

All Veterinary Practices in California Need Adequate Insurance Coverage

The reality is that malpractice is a risk that business owners operating veterinary practices need to be prepared for. Even the best and most thorough of veterinarians cannot completely eliminate the risk of facing a malpractice claim. All veterinary practices in California should secure adequate insurance coverage to protect against malpractice claims and other risks. As explained by Veterinary Practice News, “veterinarians commonly purchase professional liability (malpractice) insurance to guard against the expense of defending against such claims.”

Steps to Take When Handling a Professional Liability Claim

Is your veterinary practice facing a professional malpractice claim in California? A proactive approach is a must. You do not want to run into problems—from a business perspective and/or a legal perspective. Here are four steps to take when facing a malpractice allegation:

Notify Your insurer: As soon as a potential veterinary malpractice claim arises, promptly notify your insurance provider to activate your professional liability coverage. Prompt notification is often required by a malpractice policy.
Gather information: The next step is to collect all relevant documentation related to the case, including medical records, treatment notes, and any correspondence with the pet owner. Detailed, organized information will help to build a defense.
Watch for complaint: Beyond any malpractice claim, a veterinarian may face a complaint before the California Veterinary Medical Board. Be sure to watch for complaints and to respond to any allegations proactively.
Develop a plan of action: Finally, veterinary practice owners should work closely with insurers and consult legal counsel to develop a strategic plan of action tailored to the malpractice claim.

Get Help from Our Bay Area Business Lawyer for Veterinarians Today

Lynnette Ariathurai is a solutions-focused advocate for business owners. If you have any specific questions or concerns about veterinarian malpractice protection, we are here as a legal resource. Contact us today for a confidential initial consultation. With an office in Fremont, our firm provides business services to veterinary practices throughout the Bay Area.

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