It clearly states that Kyle incorporated the company before even meeting Jeremy. Kyle incorporated it mid-Sept-2013, and then met Jeremy end-of-Sept-2013. Jeremy then left Nov-2013, and never worked on Cruise again.
> Until a company is incorporated, who do you think owns the company? Nobody at all?
If a company is not incorporated, then it's NOT a company. There is nothing to own. For it to be legal you need to incorporate and pay taxes.
> Does that mean I could go and incorporate your company for you and give myself all the equity?
Yes, if I have a company for years and not incorporate, and not pay taxes, and operate without the government knowing, you can incorporate a company with the same name and at the same address and give the equity to yourself. You would have to pay all the taxes, register all the trademarks etc. but at the point you are essentially doing so much work running a company anyways there's no doubt that it's essentially your company.
> In lieu of another contract, everyone who started the company together is an equal partner.
That's my point. You don't need another contract. The incorporation and the equity papers IS the contract. If he had equity, he is a partner. If he didn't, he is not. That's the contract.
Yes, everyone who did the original incorporation is an equal partner, that's fine I agree with that. But clearly Jeremy WAS NOT part of the original incorporation, and NEVER owned ANY stock after all these years. He wants to be paid AS IF he was the one who incorporated the company, AS IF he had equity.
You seem to be operating with a bizarre definition of the law.
I have a consulting company. It has clients, it has revenue, and I pay taxes on that revenue. It even has a trade name.
It is not incorporated. That does not mean that you can come along, incorporate it, and say the company actually belongs to you.
By default, the result of your work is your property. This is a central concept of property rights. You can transfer that property to others in exchange for compensation, but without a contract the work remains yours.
Thus, everyone whose work flows into a company automatically is receiving a portion of that company (it is a result of their work) unless some other agreement overrides that (ex. I agree to a vesting schedule).
You cannot be bound by a contract you didn't sign. Jeremy never signed anything agreeing to give up the equity he is automatically entitled to.
> You seem to be operating with a bizarre definition of the law.
Well that seems like a personal attack. Maybe stick to the facts and not me and you?
> I have a consulting company. It has clients, it has revenue, and I pay taxes on that revenue. It is not incorporated. That does not mean that you can come along, incorporate it, and say the company actually belongs to you
Yes, exactly my point. You just proved it. In this case you (Kyle) have papers you filed with the government proving ownership of your consulting company, and paid taxes etc. It would be wrong for others (Jeremy) to come along and claim ownership of it simply because they did some paperwork that had no direct impact on the company getting clients or revenue. You just proved my point.
> By default, the result of your work is your property.
Agree.
> Thus, everyone whose work flows into a company automatically is receiving a portion of that company
Disagree. If I do volunteer work for a non-profit or school, I don't own a portion of that non-profit or school. Yes, I own the work I did, and I am entitled to take it back or discontinue it, but my work does not automatically "convert" to ownership of the organization in the absence of signed forms.
If I made a magazine for a non-profit, without being paid, I own the magazine, it's my IP, and I am entitled to stop the non-profit from using my magazine at any time. But I don't get to "own" a part of the non-profit simply because I own the magazine.
Owning my work, and owning equity in someone else's company that have used my work in the past, are 2 separate things entirely.
There is a difference between company and corporation. A company can exist without being incorporated (and many are never incorporated), a corporation cannot.
That's not the point. We are not arguing about semantics about the type the entity here. We are arguing about ownership. it doesn't matter if it's a C-corp vs LLCs etc.
The point is, there is a legal entity, with papers clearly showing Kyle has ownership and Jeremy does not.
It clearly states that Kyle incorporated the company before even meeting Jeremy. Kyle incorporated it mid-Sept-2013, and then met Jeremy end-of-Sept-2013. Jeremy then left Nov-2013, and never worked on Cruise again.
> Until a company is incorporated, who do you think owns the company? Nobody at all?
If a company is not incorporated, then it's NOT a company. There is nothing to own. For it to be legal you need to incorporate and pay taxes.
> Does that mean I could go and incorporate your company for you and give myself all the equity?
Yes, if I have a company for years and not incorporate, and not pay taxes, and operate without the government knowing, you can incorporate a company with the same name and at the same address and give the equity to yourself. You would have to pay all the taxes, register all the trademarks etc. but at the point you are essentially doing so much work running a company anyways there's no doubt that it's essentially your company.
> In lieu of another contract, everyone who started the company together is an equal partner.
That's my point. You don't need another contract. The incorporation and the equity papers IS the contract. If he had equity, he is a partner. If he didn't, he is not. That's the contract.
Yes, everyone who did the original incorporation is an equal partner, that's fine I agree with that. But clearly Jeremy WAS NOT part of the original incorporation, and NEVER owned ANY stock after all these years. He wants to be paid AS IF he was the one who incorporated the company, AS IF he had equity.