Tea Business Owners & Entrepreneurs: Don’t Be Your Own Lawyer!

Recently, my friend shared a clip of a song from the U.S. TV show Crazy Ex-Girlfriend. The song – “Don’t Be a Lawyer” made me laugh and laugh because much of it resonated as an attorney. I found this line particularly hilarious – “But no one's ever said, ’First, let's kill all the tailors.’”

Yes, lawyers often deserve the acrimony and animosity reflected in this and the thousands of other lawyer jokes. Legal services are expensive and often none of the parties on either side are satisfied or happy – a sign many in the legal community herald as success. Seriously, what other business does lack of satisfaction mark success? Lawyers are just awful.

Yet, in my experience practicing law in New York City since graduating from law school, some, ahem 20+ years ago, lawyers are the first call if there’s an issue and receive much gratitude for negotiating challenges. Access to legal advice is a lot like having health insurance, you don’t ever want to need it but you are so glad to have it if you do.

So, and I did mention I'm a lawyer so this will completely demonstrate I am one, my caveat to “Don’t Be a Lawyer” is “Don’t be your own lawyer, unless you already are one.”

Having or starting a tea business, or any business for that matter, requires so many resources that often we focus only on the revenue-generating streams for our limited resources. This is a mistake.  Investing in legal services and developing a working relationship with an attorney will save you in the future.

Frankly, the most perilous aspect of navigating legal issues without legal training is not knowing what you do not know. When business owners skimp on legal advice, believing they save money by figuring it out themselves, they often end up paying much more later trying to untangle thorny situations that could have been simply avoided with sound legal advice.

Let’s also not forget that another name for lawyer is counselor. This is the relationship business owners should be cultivating. Having legal counsel will help you avoid pitfalls others don’t see coming and will help you refine your strategies to be most effective in doing business and addressing challenges. For instance, I like to tell my clients that acknowledging a mistake and trying to make it right goes a long way in making it go away. So much of litigation and conflict comes from one party feeling wronged and unacknowledged. There is a way to accept mistakes (which happen to everyone), address concerns, not escalate a situation nor expose yourself to further liability. Trust me when I tell you, no one wins in litigation – except the lawyers. Avoiding escalation of conflict is paramount to a successful business. Having legal counsel can help you tremendously in such circumstances.

Areas Where Legal Counsel Can Help Your Early-Stage Tea Business

There are numerous other areas where legal counsel will aid your tea business despite not creating capital. Let me raise just a few of these areas for you to consider and keep in mind, this list is not exhaustive.

1. Formation

From the outset, determining the legal structure of your business will dictate how you pay taxes, what type of record-keeping is necessary and what type of personal liability exposure you will have. While there are some great online tools to form your business, it is helpful to understand the implications of each choice so you can make an informed decision as to which legal structure best fits your needs.

2. Navigating Taxation

Tax issues are complex, prevalent and can quickly ensnarl and mire a business in headaches.  Obviously, an accountant (another necessary non-revenue generating expense) can assist with many tax questions. However, tax issues become more legally challenging with the emergence of online sales. Online sales allows us to do business in multiple states. This also exposes online business to the quagmire of not only taxation from the business’s state of domicile, but also the tax laws of other states and local cities. If you are doing business online and out of your domicile state, you need to make sure you are collecting and paying taxes as required by the laws of these other states. One thing all states do well is collect the taxes owed to them.

3. Labeling and FDA Requirements

It is challenging to even briefly put into writing the density of overlapping federal, state and local laws governing storing, selling and labeling a food product such as tea. Just at the federal level, there are at least three different administrative agencies, including the FDA, that have regulations regarding food safety. If you are not in compliance, you run the risk of having to hire an attorney to defend your business and face civil fines. You may also be precluded from doing business during the investigation. All of which will be far more expensive than obtaining legal advice first to ensure compliance. Not to mention, once the FDA has found you to be a violator, they scrutinize everything you do going forward much more closely. Avoid all this and get the correct legal advice from the outset.

4. Contracts

Even setting aside some of the bigger contracts like partnership agreements or investor agreements, employee contracts or handbooks, every business will have many contracts. Some contracts you can reuse repeatedly once you have the form of the contract correct – so get it right! An invoice is a contract, you need to make sure all the terms make sense for your business are included, and you are not missing anything that could preclude you from collecting your money. If you have a website, the terms of use on your site dictate your exposure for collecting sensitive information or even merely signing up user for your newsletter. If you have a brick-and-mortar establishment, you will certainly have a lease. An attorney to review the terms of the lease could save you thousands in the future.  And guess what, even if you do not think you have a contract for goods and services, you do. Every state has adopted some form of the Uniform Commercial Code (“UCC”). Without an express or oral contract between the parties, the UCC will act as the terms of the contract. Even if you have a contract but your contract does not address a specific issue and there is a UCC clause for that issue, that UCC clause becomes part of your contract. So, you need to understand how the UCC impacts your business dealings.

5. Intellectual Property (“IP”)

IP is a valuable asset of all businesses that must be protected. One does not even need look to anything as complex as trade secrets. As you develop your business, you build your brand identity.  You put time, money and resources into building the reputation and identity of your business. Your brand identity is IP. If someone comes along and confuses consumers to take advantage of your hard work, you will wish you had taken all the necessary steps to protect your business. Again, it is easier and more cost-effective to start in the right place rather than trying to bandage over deficits once you have a problem.

There are so many other areas to discuss where legal advice would be worth the financial investment. However, I was given limited space for this article, which was wise given the propensity of lawyers to be overly verbose.

I hope in this brief article, I have convinced you of the necessity for even a beginning tea business to invest in legal counsel. Having an attorney for your business will provide you the means to negotiate challenges and to expand your business opportunities. Do not undervalue the necessity of these services merely because the services do not generate direct revenue.

If I could sing it, I would (but it’s better for everyone I refrain)… don’t be your own lawyer!

Editor’s Note: Hear more from Jeni Dodd, a lawyer and tea business importer, at the 2023 World Tea Conference + Expo. Dodd will cover subscription services, legal implications for tea businesses, and a courtroom full of issues that tea business entrepreneurs. Check the World Tea Expo website for details on date, time and location.

Born and raised in America’s heartland, Jeni Dodd, Esq., has journeyed far from the plains of Kansas to remote tea-growing regions throughout the world in search of the perfect cup of tea. The owner of Jeni Dodd Tea, a company dedicated to importing hand-crafted, unique specialty teas and offering tea education for groups and events, Dodd seeks to expand the public’s awareness of the specialty tea market and lead consumers to discover the exquisite joy of the leaf. A Certified Tea Specialist through the Specialty Tea Institute, she has completed all of STI’s Level IV courses offered to date. She’s also taught future tea entrepreneurs and enthusiasts at the Specialty Tea Institute and has presented several times at the World Tea Conference + Expo and TEXSOM, as well as regional tea festivals in the United States. She was the keynote speaker at the Australian Tea Cultural Seminar and spoke at the International Tea Festival in Nepal. True to her roots, Dodd remains an avid Kansas Jayhawk basketball fan. Learn more at JeniDoddTea.com.

Plan to Attend or Participate in the
World Tea Conference + Expo, March 27-29, 2023

To learn about other key developments, trends, issues, hot topics and products within the global tea community, plan to attend the World Tea Conference + Expo, March 27-29, 2023 in Las Vegas, co-located with Bar & Restaurant Expo. Visit WorldTeaExpo.com.

To book your sponsorship or exhibit space at the World Tea Conference + Expo, or to enquire about advertising and sponsorship opportunities at World Tea News, contact:

Ellainy Karaboitis-Christopoulos
Business Development Manager, Questex
Phone: +1-212-895-8493
Email: [email protected]

Also, be sure to stay connected with the World Tea Conference + Expo on social media for details and insights about the event. Follow us on TwitterFacebookInstagram and LinkedIn.