Legal advice is essential. Sometimes legal precautions cost you a million dollars. Just ask Joe he lost out big 3 days before a payday.
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THIS IS NOT A LEGAL CRITIQUE
I am not criticizing attorneys. I am not bashing the legal professional. I am pointing out the difference between an attorney who is a great legal adviser and an attorney who veers off the path to give you their opinion outside the law.
Sometimes people consult an attorney for legal advice and unbeknownst to them they receive an uneducated speculative opinion.
As scripture says, “Fools have no interest in understanding; they only want to air their own opinions.” Proverbs 18:2 (2)
Attorneys are seldom entrepreneurs (3). They are law practitioners. Good attorneys accurately tell you the law, how to litigate it and if a person violates laws what consequences the person may expect.
Attorneys not educated in entrepreneurship relating to business, finance, business operations, fashion or technology can find themselves giving you an opinion. After all, if an attorney is not a scientist what qualifies them to explain you the origin of the universe?
The short answer. Nothing. Don’t listen to an opinion of someone who is ignorant to the subject they are being asked.
Typically, the person innovating is an entrepreneur. Entrepreneurs should ask other successful entrepreneurs for advice.
Remember fools offer opinions instead of understanding. Just because someone has a title it doesn’t preclude them from acting a fool.
GOING TO A NON-PRACTICING ATTORNEY FOR PRACTICE
The biggest error people make is consulting an attorney who does not practice a particular field. This often happens when a client develops trust to the point of friendship with an attorney. This attorney may be versed on specific law.
This law could be real estate, finance, manufacturing, civil litigation or some other field.
Remember, attorneys typically choose a field to practice in. Laws are complex. It is rare to find an attorney who practices all fields in expert fashion.
Attorneys are seldom entrepreneurs (3). They are law practitioners.
An LLM, or Master of Laws, is a graduate qualification in the field of law. The LLM was created for lawyers to expand their knowledge, study a specialized area of law, and gain international qualifications if they have earned a law degree outside the U.S. or Canada (4).
If your attorney does not have an LLM in the subject you are asking it is typically a sign you need another attorney to answer your question.
Be leery of the “jack of all trades” and “master of none”. These people are what I call the “Professional Hustler”. Sound familiar? I’m sure it does. I am one. A professional hustler. Remember real recognizes real.
THE STORY OF A MILLION DOLLARS LOST
I personally know someone (Let’s call him Joe Entertainment) who decided to seek legal advice on an entrepreneurial transaction. The deal held all the mechanics of what you want to see as a “Green Flag”.
There was a “Checkered Flag” but the flag was raised up front. It was discussed prior to any movement or deal discussion. The perspective partner of Joe Entertainment told him if it made him feel uncomfortable no deal he would seek an alternative partner. Joe Entertainment agreed to move forward despite the disclosure because the perspective partner was in a verifiably better position than him financially.
“Fools have no interest in understanding; they only want to air their own opinions.” Proverbs 18:2 (2)
Joe Entertainment was offered a deal that consisted of: 1) Joe and the would be partner equally share costs, 2) No up-front fees or charges could go to the perspective partner, 3) the counter parties were reputable (attorneys, banks, bona fide investors, et cet), 4) the partner would post their personal assets to qualify for reception of the million dollar deal, and 5) the partner would use his notoriety publicly partnered with a celebrity billionaire to attract attention to their venture.
This scenario consisted of very measurable tangible items.
Joe Entertainment had two (2) responsibilities. The first responsibility was to put together a rollout plan in his field (he was a recognized expert in his field). The second responsibility was to provide half the costs of the financing cost to the investment bank offering the monies. If the deal didn’t work out both would equally burden the risk of transactional costs.
The deal was a million-dollar financing deal which required a million dollars of collateral. The partner would post the collateral to qualify and pay half of financing costs. The proposed partnership was 50/50. The deal was equitable despite the risk being more on the partner who had assets. Joe Entertainment stood to lose nothing but a dent in his reputation if it failed and a nominal amount of money (a few thousand dollars).
The partner gave draft contracts to Joe Entertainment. Joe informed the partner he had an attorney he wanted to look over the partnership agreement. The partnership agreement was straight forward. They would both go 50/50 in the partnership and each party would equally contribute the amount of money required to finance the deal. The exception was the partner (not Joe) would post assets. The partner instructed Joe’s attorney to change it in any way necessary to accommodate Joe Entertainment. Any terms for refunds or nonperformance would be honored.
Pretty easy and straight forward, right? Well let’s talk about the Checkered Flag. No one has a perfect history.
THE CHECKERED FLAG
The partner disclosed his legal past up front. He detailed the case details. He explained it clearly. The parties met and after disclosure they shook hands and agreed to move forward despite the partner’s legal issues. The allegations occurred about a decade before Joe’s current deal. Despite a pending suit (ongoing for about four years) no activity had occurred since an initial hearing about 3 and a half years ago. The suit involved losing about a million dollars through a transaction where there were allegations of financial misconduct. The statue of limitations was about to run out. There was much speculation the case would just be dropped at this point.
Not the best situation but straight forward.
Don’t listen to an opinion of someone who is ignorant to the subject they are being asked.
Remember Joe was disclosed this situation up front. He did not have to move forward. Joe chose to move forward with full knowledge of the above.
Expert advice versus uneducated opinion is a thing. Let’s discuss how an ill-informed opinion can derail a crucial deal.
THE OPINION WHICH LACKED UNDERSTANDING
Nothing was proven. It was still possible the partner could emerge Not Guilty. All this was disclosed up front. Allegations are not the same as a conviction. Upon Joe’s arrival to his attorney the attorney researched the claims. Joe’s attorney did not 1) practice securities law, 2) criminal law, 3) financial misconduct 4) criminal defense, 5) have any prosecution experience or 6) practice business law.
The attorney only practiced civil litigation. The attorney was not even specialized in Joe’s industry.
The attorney’s opinion was to tell their client to not take the deal. In the words of the attorney, “It looked like a professional hustle.”
THE CONCLUSION WHICH SHOOK JOE ENTERTAINMENT
Joe drug out giving the partner an update on this situation. Joe wanted the deal but lacked the money personally. Joe needed money from third parties to do the deal. Joe didn’t explain this up front to the partner. Although Joe didn’t have to 1) Risk any of his assets, or 2) Guarantee the repayment he was torn.
Joe’s attorney opinion kept echoing in his mind.
“This guy is going to hustle you. It doesn’t look real. Be careful. Look at the lawsuits. It sounds bad.”
Joe was conflicted. He kept going over the details. How could a guy who was accepting all the responsibility for pay back, posting all the collateral and paying for half the costs be hustling him?
What was in it for him? Losing his own money?
It didn’t make sense.
He couldn’t be looping in three other attorneys, a banker, an escrow agent and a securities dealer in some kind of fraud. There were too many reputable people with clean records involved. Sure, the partner had a history…but all these people checked out. With these many fiduciaries someone would catch something if it was a bad deal. They all said he was good for the deal. Joe had written correspondence and confirmation the deal was solid.
How could his attorney come to the opposite conclusion?
It didn’t make sense. The conclusion of the attorney was illogical. True, he was risking thousands of dollars…but how could this guy not close?
If he didn’t close, the partner would be out money too…
Joe pondered the situation. He decided to tell the partner he would do the deal.
Remember Joe was disclosed this situation up front. He did not have to move forward. Joe chose to move forward with full knowledge of the above.
“The check cleared my friend. I’ll bring you a cashier’s check Saturday or Sunday.”
The partner replied, “That’s great. Let me know as soon as the contract is done, and I will execute it.”
Then Saturday came. As he was about to get in his car he thought of his attorney’s words.
“You will be completely responsible for your thousands. It’s all on you. Don’t risk it on him. I don’t believe he’s real. No way a guy who is indicted is straight up.”
Joe went ghost. The partner kept contacting Joe. Joe kept giving mixed signals. He would send the partner affirming texts. He would give him different deadlines. He missed his deadlines every time.
“I’ll do it by Friday!”
Then Friday would pass.
“I apologize sir. I’ll get it out by the first! Legal delays. Sorry.”
The first would pass too.
The partner would ask, “Do you want me to pay your share? You can reimburse me later?”
Joe agreed, “Sure sir. I will come through.”
Eventually, after leading the partner on for over 7 weeks and having him pay the full costs of the financing – Joe delivered the bad news. He would not reimburse the perspective partner. He would back out of his word, commitment and his handshake. The attorney’s words were too much.
He couldn’t stake his reputation. Joe didn’t know what he didn’t know.
“The deal will never close.” The attorney said. “This is a hustle. I’m sure.”
Twenty-four hours after backing out the deal…Joe’s attorney was notified the million dollars came in and Joe was entitled to none of it.
Joe let a million dollars go by. This financing deal could have grown his company exponentially.
Joe’s million-dollar deal would have grown his company to over 10mm USD in annual revenue. Joe didn’t just lose access to superior relationships. Joe lost access to a million dollars’ worth of collateral. Joe knows no billionaires. Joe can’t pay a billionaire to meet him. No one is lending unsecured money any longer. Joe has no back up.
This lost deal happened in midst of the worst financial market since the 2008 collapse. Today more banks have failed than during the 2008 housing collapse; as a matter fact 2023 was the biggest year for bank failures ever (5). Interest rates are at their highest rates in nearly twenty years. There’s no guarantee Joe will find someone willing to give him a million dollars. More important Joe doesn’t have the collateral anyways.
Joe standing in disbelief realizes the attorney is wrong. Then a pause. Joe realizes his attorney was right. He really did lose money. He lost money giving it to the attorney who gave him bad opinions. He looks at his bank account. Man. It’s the same amount his partner was asking for.
Joe paid for a guaranteed “No”. At least with his partner he had a chance.
Imagine that. He spent the money anyway.
The only difference? Joe bought a ticket to not ride the rollercoaster. He should have just taken the ride. He really did get hustled. He got hustled by his attorney to give him money for literally nothing. That’s exactly what Joe has now. Nothing.
Want a seven-figure value? Find a seven-figure worth inside yourself. Your worth exists. Unfortunately, my secret for seven figure items will not be discovered in this free article. You must pick up a copy of my international best-selling book “I Made It Then I Didn’t” or order “Many Paths To Profit” for that.
The concept I teach in this article is free. My personal stories are not. Don’t let pennies get in the way of dollars. There’s no such thing as a free lunch. Buy my books today to discover your worth. I think your worth a whole lot more than what people value you. If you want to actually discover what these documents, incorporating documents, attorneys and broker dealers who do this look like…it won’t be found in a free article. There’s a catch to everything! You always pay for what you don’t know.
To Your Knowledge Success!
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Sources
1) The life of Christopher Knight Lopez a Professional Hustler turned International Best Seller and Published Author of “I Made It Then I Didn’t” & Co-Author of “Many Paths To Profit” with the original shark from Shark Tank Kevin Harrington.
2) The Holy Bible. New Living Testament Translation.
3) Forbes. “The Golden Age of The Legal Entrepreneur -- Why Now and Why It Matters”. Cohen Mark. 1 June 2018. Accessed August 14th 645AM CST.
4) LSAC®. LLM Degree programs. www.isac.org. Accessed 14 August 714AM CST. Link: https://www.lsac.org/discover-law/types-law-programs/llm-degree-programs#:~:text=An%20LLM%2C%20or%20Master%20of,outside%20the%20U.S.%20or%20Canada.
5) American Banker. “Dramatic collapses made 2023 the biggest year ever for bank failures”. Wack Kevin. 13 December 2023. Accessed 14 August 2024. Website: https://www.americanbanker.com/list/dramatic-collapses-made-2023-the-biggest-year-ever-for-bank-failures.
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Certain elements in this story may have been fictionalized to illustrate a creative story. This is a form of artistic expression not narration of fact. Not a form of investment advice. Please consult a professional registered to give you advice about your individual circumstance. This article is for educational purposes and entertainment purposes only. Please do not email the author about advice on investing or strategies on making investments.
About Christopher: Christopher Knight Lopez is a Professional Hustler turned International Best Seller and Published Author of “I Made It Then I Didn’t” and Co-Author with Kevin “The Shark” Harrington “Many Paths To Profit”. Christopher has opened over 7 businesses in his 15-year career. Christopher’s purpose is to take advantage of various market-driven opportunities. Christopher is a certified Master Project Manager (MPM), and Accredited Financial Analyst (AFA). Christopher previously held his Series 65 securities license examination and was a Master Financial Planner (MFP). Christopher also held his General Lines — Life, Accident, Health & HMO. Christopher has managed a combined 286mm USD in reported Assets Under Management & Assets Under Advisement. Christopher has work experience in 33 countries, raised over 50mm USD for various businesses, and grossed over 13.0mm in his personal career. Christopher worked in the highly technical industries of: biotechnology, finance, securities, manufacturing, real estate, and residential mortgages. Christopher is a United States Air Force Veteran. Christopher has a passion for family, competitive sports, fishing, martial arts and advocacy for entrepreneurs. Christopher provides self-help classes for up-and-coming entrepreneurs. Christopher’s passion to mentor comes from belief that entrepreneurs need guidance. The world is full of conflicting information about entrepreneur identity. See more at www.christopherklopez.com.
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