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In an age when so much happens online, businesses must be willing to commit to digital security to best protect the sensitive data and information of themselves and their customers. In fact, some estimates indicate that the global market for cybersecurity will surpass $80 billion next year, indicating just how important this issue has become.

To help your business start to address this complex issue, the following are a few best practices for protecting sensitive data on your networks.

• Invest in a dedicated server: Many small businesses use shared servers to host their files. While this can be a cheaper option, it also means that multiple parties may have access to that server. If another website on the server has weak security, your site could be vulnerable, as well. A dedicated server can be worth the extra expense for the peace of mind it provides.
• Encrypt all your data: You should never keep sensitive information and records unencrypted. If your network is somehow compromised, unencrypted information is an easy target for cyber criminals.
• Always monitor for malware: Establish programs monitoring your website’s security at all times so you can be alerted instantly to the presence of any malware. As soon as your site has been infected or has the potential to be compromised, you will be able to address the problem before it gets out of control.
• Keep access restricted: Access to sensitive files containing personal customer information should be on a “need to know” basis only. Keep all files in a single, centralized location, whether they are digital files in one server location or physical files in a filing cabinet in a locked room.
• Regularly shred paper documents: If you keep physical copies of the information you store online, be sure to properly dispose of it. Shred or burn any sensitive customer data—simply throwing it in the trash or recycling is not good enough.
• Permanently delete digital files: Simply moving a file to the trash bin on your computer does not wipe it from your files. There are still traces of the file that allow it to be recovered. There are a variety of programs that make it easy to permanently delete these files when you are ready to do so.
• Always have a response plan ready for a breach: You need to be prepared in the event a breach does occur. This should include isolating the problem, notifying any customers who may have been affected and resolving the situation as soon as possible. You should never attempt to conceal a breach from your customers—be as open and honest as you can be.

Cyber security must be a crucial component of your company’s digital operations. Be sure to consult an information technology professional to establish a plan for your business, and speak with a knowledgeable intellectual property attorney to ensure you are covering all your legal bases.

Tom Bolt is Managing Attorney of BoltNagi, a widely respected and well-established intellectual property law firm serving businesses and organizations throughout the U.S. Virgin Islands.

With all the risks that come with running a small business, it’s critically important for owners and entrepreneurs to have proper insurance coverage to protect against unexpected catastrophes. There are many different forms of commercial insurance available to cover a variety of risks.

Property insurance policies

Property insurance is a category encompassing a variety of insurance policies that cover losses and damages to real or personal property. Examples of these policies include:

• Debris removal: This covers any costs associated with clearing and removing debris after your business has been damaged by a flood, fire, tornado or other natural disaster. Before you can start rebuilding and repairing your property, you must be able to remove all the debris, making this coverage extremely useful.
• Builder’s risk: This type of insurance covers buildings during their construction. If, for example, a windstorm takes down part of a building during the construction process, those losses would be covered.
• Boiler and machinery: Boiler and machinery insurance protects you in the event of an accidental breakdown of equipment, such as boilers and other crucial building machinery. It will cover both property damage and business interruption losses.
• Business interruption: This type of policy covers losses you suffer because of interruptions to your businesses due to natural disasters or property damage.
• Crime: Crime insurance covers various property crimes such as vandalism, theft, robbery and burglary of products, money and stock by customers, employees or other parties.

Other forms of insurance

Outside of the property insurance umbrella, there are numerous other forms of insurance coverage that can protect your company. The following are a few examples:

• Liability insurance: Any damage you cause to third parties is covered under liability insurance. For example, if someone files a personal injury or premises liability claim against you, the cost of resolving and defending that claim would be covered under your policy.
• Malpractice insurance: Also known as professional liability insurance, this type of policy protects you if your conduct falls below a certain standard of care for your profession, resulting in injuries or losses to another party.
• Car insurance: Commercial auto insurance covers any company vehicles you have that you use specifically for business purposes.
• Workers’ compensation insurance: This policy covers you if any of your employees suffer injuries on the job, regardless of whose fault those injury were.

These are just a few of the many forms of commercial insurance available for business owners in the U.S. Virgin Islands. For further guidance on this important, consult an experienced business law attorney.

BoltNagi is a widely respected and established business and corporate law attorney serving clients throughout the U.S. Virgin Islands.

Over the past year, business owners across the United States have been trying to prepare for December 1, when new Fair Labor Standards Act (FLSA) overtime rule changes were set to go into effect.

However, in late November, Judge Amos Mazzant of the U.S. District Court issued a ruling blocking the implementation of the rule, primarily due to the way it treated white-collar exemptions within the law as it was originally written. According to the court, Congress intended these white-collar exemptions to turn on an employee’s performance and conduct on the job—and not his or her salary. The judge’s ruling essentially states that by doubling the salary threshold for guaranteed overtime pay, the U.S. Department of Labor operated outside its jurisdiction.

It is important to note that this injunction is not permanent and is only meant to delay the rule until the courts can make a “merits determination.” While a permanent injunction is anything but a given at this point, the fact that a federal judge even implemented a preliminary injunction indicates there’s at least a chance the rule could be overturned.

With a change of administration coming to Washington, D.C., this also means President-Elect Donald Trump and his Secretary of Labor will have a lot of say as to whether the Department of Labor will continue to pursue the new overtime regulations under the FLSA.

What impact will this injunction have on businesses?

Small businesses across the country widely supported the ruling by the federal judge, as did the National Association for the Self-Employed. Many believe that had the DOL succeeded in implementing the change, there would have negatively impacted small businesses. Employers suddenly would have been forced to eliminate positions, cut back hours or change salaried workers to hourly.

Some small business owners had asked for specific exemptions to be put into place for smaller organizations so they would better be able to adjust to the changes. Many businesses had not yet shared any information about these rule changes to their employees, which would have meant a large number of workers would have been suddenly surprised by a change in their payment had they not been following along.

One study by ComplyRight revealed that out of nearly 800 owners of very small businesses (under 20 salaried employees) polled, about 82 percent had not shared information with employees regarding the new law. This would suggest employers either did not know how they were going to make the changes within their business or were altogether unaware the changes were coming.

It will be important for businesses owners in the U.S. Virgin Islands and beyond to stay up to date on this issue as it develops. If you have any questions about how the potential overtime rule change could impact your company, meet with a knowledgeable employment law attorney.

Ravinder S. Nagi is Assistant Managing Attorney and Chair of the Litigation Practice Group at BoltNagi, an established and well-respected civil litigation law firm serving individuals, businesses and organizations throughout the U.S. Virgin Islands.

Every product you sell as a manufacturer is subject to the Uniform Commercial Code. This law requires you to guarantee to your customers that your products are free of infringement claims made by other manufacturers.

You may already have customer contracts in place with even more stringent conditions, such as providing legal defenses to customers or reimbursing them for any costs that could be imposed on them as a result of a lawsuit. These costs may quickly mount to staggering figures, so businesses need a way to mitigate the risk. The best means of accomplishing this is negotiating an indemnity clause with your customers.

Indemnity is kind of like an insurance policy — as it protects the “indemnitee” from certain covered losses. A typical agreement involves an “indemnitor” promising to protect the indemnitee from certain losses sustained as a result of a specific act or omission. Practically speaking, this would involve a manufacturer or seller of a product agreeing to cover the buyer for specific losses sustained in third-party patent or trademark infringement claims.

Considerations as you begin the process

Your first step in creating such a clause is to clearly define the parties and the scope of claims your agreement will cover. Typically, the agreement will be between a seller or licensor and a buyer or licensee. You should also consider whether you will cover officers, affiliates, subsidiaries and other parties in the agreement. If your transaction also allows resale or sublicensing, you will need to consider whether those third parties will also be protected (or “indemnified”).

Once you have set all of the ground rules, you should clearly identify each party’s obligations. In most situations, an indemnity provision would indicate that the seller will indemnify, defend and hold the buyer harmless from any losses associated with the covered claims.

There’s a variety of other considerations that could also impact the scope of your coverage and your liability. These include limitations of use, limitations on liability, geographic limitations, multiple indemnitors, pre-existing threats and remedial measures. Your corporate planning attorney can work with you to pinpoint any such factors that could have an impact on your indemnity agreement with your buyer or licensee.

Finally, you should be sure to clearly identify the procedures that must be followed to initiate and resolve any claims that occur. These procedures include the amount of notice time required to file a claim, who is the controlling party, the parties that will have authority to settle, the obligations each party has to cooperate and the amount of time the seller has to provide reimbursement.

Attorney Steven K. Hardy is an Associate in the Corporate, Tax and Estate Planning Practice Group at BoltNagi, PC, a well-established and respected intellectual property law firm serving individuals, businesses and organizations throughout the U.S. Virgin Islands.

Tax deductions are important tools for small business owners that can help them maintain efficient operations while reducing their tax obligations. The more deductions you can take, the less income the Internal Revenue Service (IRS) can tax you on, which means greater savings and more capabilities to grow your company.

The following are a few common tax deductions of which every small business owner in the United States and its territories should be aware:

• Vehicle expenses: If you regularly use your motor vehicle for business, or your company has its own car, you may deduct a portion of the costs associated with using it. There are two different methods for doing so. The first is the actual expense method, where you track and deduct every business-related expense associated with your vehicle. The other is the standard mileage rate method, in which you deduct a certain amount of money for every mile driven, plus all tolls and parking fees related to business.
• Traveling: Whenever you travel for business reasons, you may deduct many of the expenses, including plane fare, car costs, taxis, meals, lodging, cleaning clothes, phone calls, tips and taxes. As long as business is the primary purpose of the trip, these costs are deductible. However, if you take family members along, only your expenses may be deducted, as only you are there for business purposes.
• Business formation expenses: The cost of actually starting up a business are considered capital expenses. You are allowed to deduct $5,000 of these expenses in your first year of business. Remainders must be deducted equally over the course of the next 15 years.
• Books and professional fees: Business books for your finances are fully deductible as business expenses. You may also typically deduct fees you pay to attorneys, consultants, tax professionals and accountants in the year those expenses were incurred. But if the work they performed was related to future years, those expenses may need to be deducted over the amount of years in which you expect to benefit from those services.
• Business entertaining: If you pay to entertain current or prospective customers or colleagues, you may deduct 50 percent of those costs, as long as they meet certain stipulations. The entertaining must be directly related to business, with business discussed at the event—or it must be somehow associated with your business. The entertainment must also take place immediately before or after business discussions.
• Interest: If you finance purchase for your business, all interest incurred is completely tax deductible. This is also true if you take out a personal loan, but use its proceeds for business purposes.

Navigating the complexities of the IRS and U.S. and territorial tax law can be complicated. Be sure to meet with a skilled business planning attorney to make sure you are getting the most out of your deductions.

Attorney Adam Marinelli is an Associate in the Corporate, Tax and Estate Planning Tax Group at BoltNagi, a respected and well-established business law firm serving clients throughout the U.S. Virgin Islands.

When you’ve signed an agreement with another party, one issue you may find yourself dealing with is an “anticipatory” breach of contract, which often means taking action before an actual breach has occurred.

For a little context, a contract could be considered breached or broken if either party unconditionally refuses to perform under the contract as promised. This unconditional refusal is referred to as a “repudiation” of the contract.

Whenever a party indicates through actions or words that it will not live up to its contractual obligations, the other may file a breach of contract claim and seek remedies, typically in the form of monetary payment. This is referred to as “anticipatory breach of contract,” a situation in which the party might not have actually breached the contract yet, but there is reason to believe it will not live up to its end of the deal.

The following are a few of the most common situations in which repudiation may occur:

Express repudiation: Express repudiation is a circumstance in which one party clearly communicates an unconditional refusal to the other party. The repudiating party must outright state that it will not follow through with the deal. An ambiguous refusal—or one qualified with certain conditions—is not enough to be considered express repudiation. It must be completely clear, direct and straightforward, with no other potential meaning.

Actions make it impossible for the party to perform: Actions can sometimes be just as powerful as words when it comes to repudiation. If, for example, someone wanted to start a business and took out loans to do so, but then recklessly ran the business into the ground and incurred numerous other debts in the process, it would be impossible for that person to pay back those original loans. Although this isn’t considered express repudiation, it is clear to the lender, through the actions of the borrower, that the borrower will not live up to his/her contractual agreement because of voluntary actions.

Property that is the subject of the deal was transferred to another party: If the contract in question was in regard to the sale of a certain piece of property, repudiation would occur if one party either transfers or makes a deal to transfer that same property to a different party. For example, if you were under contract to purchase a house, but then discovered the seller sold it to someone else, your contract was repudiated and you may be able to seek legal remedies.

It is, in some circumstances, possible for a party to repudiate the contract, but then retract that repudiation. If the other party did not make a “material change” in his or her standing due to that repudiation, the agreement may return to normal.

Consult an experienced business attorney to learn more about this issue and others related to business contracts.

Attorney Mark Kragel is Senior Counsel with the Litigation Practice Group at BoltNagi, a well-established and widely respected civil litigation law firm proudly serving individuals, businesses and organizations throughout the U.S. Virgin Islands.