Minnesota Business Lawyers: Applying for a Business License

In many industries, obtaining a business license is one of the most significant prerequisites for doing business in Minnesota. Paradoxically, despite its importance, too many businesses resist involving Minnesota business lawyers in this process from the very beginning – at the stage of the business license application preparation. Instead, attorneys throughout Minnesota (including Minneapolis business attorneys and St. Paul business attorneys) are involved in the process only after the business license application is rejected by the relevant state agency.

There are two primary reasons for the late involvement of Minnesota business lawyers in the process. First, business owners believe themselves perfectly capable of filling-out a license application. Second, small businesses are always looking for a way to cut costs and think they are saving money by involving business lawyers only by the time of an administrative appeal hearing.

Both motivations are flawed. A business license application often involves much more than simply filling out the basic information and gathering the supporting materials (such as financial statements or criminal records). The key to a successful application is the ability to spot potential issues and fix the problems prior to the submission of the application to the government agency. It is true that Minnesota business owners are smart and energetic individuals perfectly capable of filling out an application. However, they often lack the necessary legal experience and training to identify potential problems and know how to fix them.

Second, it is much cheaper to involve an attorney at an early stage of the business license application process than to deal with the problems at an administrative appeal hearing. Prior to the submission of the application to the agency, the attorney should be able to review the application filled-out by the owner and all of the supporting materials, spot potential problems, and advise on how to fix these problems immediately. Even after the application is submitted and the relevant Minnesota government agency raises an objection, involving an attorney who may be able to negotiate the solution to the problem prior to the final agency determination may prove to be very cost-effective.

By the time the application is rejected, however, Minnesota business license appeal lawyers will have to deal with a prolonged process defending the business owner’s interests. Even worse, in many cases, the burden of proof may be on the initial applicant, which means, for example, that a business lawyer would have to prove that the government more likely than not committed an error of judgment (or some other legal theory).

In sum, litigation is almost always more expensive than the prophylactic measure of involving a Minnesota business license lawyer at an early stage of the business license application process. At the very latest (i.e. the last opportunity to save the application while lowering legal expenses), the business owners should involve Minnesota business lawyers at the time when they receive the first request for additional information from a relevant Minnesota government agency.

Sherayzen Law Office can help you at every stage of the business license application process, starting from the initial review of the application to dealing with the government agencies , handling the administrative appeal hearing, and litigating further appeals to the district court and higher appellate courts if necessary.

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Business License Denial Appeals and Office of Administrative Hearings

If your business license was denied by a government agency in Minnesota, you need to act immediately to secure an administrative appeals lawyer to analyze the facts of your case from a legal perspective. In almost all cases, a license denial by a government agency can be appealed for additional review. This right to appeal, however, usually has a definite time limitation. Most Minnesota government agencies give you as little as thirty (30) days to appeal the denial of your business license, and it is very rare to have more than sixty (60) days to appeal an administrative determination.

In Minnesota, most of the business license denial cases are appealed to the State of Minnesota Office of Administrative Hearings. The Office of Administrative Hearings is an independent agency which should conduct impartial hearings for other state agencies. Once you appeal your business license denial, you will become part of what is known as a “contested hearing” – basically, this means that there will be a trial-like hearing. An administrative law judge will preside over a hearing while both sides have an opportunity to present their evidence and cross-examine each other’s witnesses.

Indeed, even though this is supposed to be an administrative hearing with much more relaxed procedures than those adopted by the civil courts, the Office of Administrative Hearings follows a set of rules which partially adopt and/or resemble the Minnesota Rules of Civil Procedure. This means that a skilled lawyer may take full advantage of the prehearing motion practice to benefit his client’s case.

A major drawback of the contested hearings conducted by the Office of Administrative Hearings is the fact that, in most cases, an administrative law judge is only able to issue a recommendation which may be rejected or accepted by a government agency that originally denied the license. This means that, if the government agency persists in its denial and ignores a contrary ruling by an administrative judge, you will have to appeal the case further to the district court. This is not common, but it happens.

As you can see, the appeal of a business license denial is not an easy task and may require a detailed knowledge of laws and administrative procedures. This is why it is important to secure the help of a Minnesota administrative appeals business attorney as soon as possible.

Sherayzen Law Office has the necessary administrative appeals experience and knowledge of the rules and procedures of the Office of Administrative Hearings to mount an effective and vigorous representation of your interests.

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Net Worth Requirement for Money Transmitter License in Minnesota

An applicant for a money transmitter license in Minnesota must comply with Minn. Stat. §53B.05 net worth requirements. Under Minnesota law, each licensee engaging in money transmission in three or fewer locations in the state, either directly or through authorized delegates, must have a net worth of at least $25,000. However, if a licensee engages in money transmission at more than three locations in the state, but fewer than seven locations (either directly or through authorized delegates), he must have a net worth of at least $50,000. If there are more than six locations in the state, the licensee should have a net worth of $100,000 and an additional net worth of $50,000 for each location or authorized delegate located in the state in excess of seven, to a maximum of $500,000. The net worth is calculated in accordance with generally accepted accounting principles (“GAAP”).

The required net worth must be maintained throughout the licensed period. Failure to meet the statutory net worth requirement may lead to license revocation and denial of the license renewal application. Minn. Stat. §53B.19 (2).

The burden of proof is on the initial licensee. This means that when the applicant files its money transmitter license application for the very first time, he must prove by preponderance of evidence that he satisfies the net worth requirements and any other issues raised by the Minnesota Department of Commerce (“Department”). When an application for license renewal is filed, however, the issue of who bears the burden of proof is not yet settled by courts. There is a very good argument that the Department bears the burden of proof once the initial burden of production is satisfied by the applicant. Sherayzen Law Office can help you make this argument once the need arises.

It is very important to hire a Minnesota attorney to review your license application. The regulatory compliance costs are very high and making sure that your application satisfies the statutory requirements prior to its filing may be crucial to containing legal expenses and even ultimate ability to obtain (for the first time) or renew the license.

If, however, you submit your license application without professional review of a Minnesota attorney and the Department raises issues with respect to the application, it is indispensable to retain a Minnesota business lawyer as soon as possible. Timely professional intervention may lead to quick resolution of the issues and led to significant savings in accounting and legal expenses.

Sherayzen Law Office can help you file a new license application as well as a renewal application. If your application has been rejected and you appeal the case with the Office of Administrative Hearings, Sherayzen Law Office will provide you with a vigorous yet cost-effective legal representation. Call our office at (952) 500-8159!