Houston Business Formation Lawyer

Starting a new business involves important decisions that affect its future success and your personal liability. Selecting the correct legal structure is a critical first step in launching a successful enterprise. Our attorneys work closely with entrepreneurs, professionals, startups, and established businesses throughout Texas, ensuring their companies are structured properly from day one.

Choosing the right business entity is essential. We start by learning your goals, understanding potential risks, and considering your long-term vision. Based on that analysis, we recommend the structure that best aligns with your objectives and provides maximum legal protection.

Common business structures we can help with include limited liability companies (LLCs), corporations (C-corporations and S-corporations), partnerships, limited liability partnerships (LLPs), professional limited liability companies (PLLCs), and sole proprietorships.

Limited liability companies (LLCs) and professional limited liability companies (PLLCs) provide protection from personal liability while offering flexible management structures and favorable tax treatment. They’re ideal for many small- to medium-sized businesses seeking to shield owners’ personal assets.

Corporations, including C-corporations and S-corporations, provide robust liability protection with defined management structures involving shareholders, directors, and officers. C-corporations allow for complex ownership and investment structures, while S-corporations offer beneficial pass-through taxation to shareholders.

Limited liability partnerships (LLPs) are commonly used by professional practices, like law firms and accounting firms, providing liability protection while allowing profits and losses to be shared according to partnership agreements. Sole proprietorships offer simplicity and direct control, making them attractive for single-owner businesses that prioritize ease of operation over liability protection.

We handle all aspects of business formation, from drafting and filing initial formation documents to preparing critical governance documents, such as bylaws, operating agreements, partnership agreements, shareholder agreements, and company agreements. Our attorneys ensure that your new entity meets all Texas legal requirements and that you fully understand your ongoing compliance obligations.

Beyond initial formation, we also assist businesses with operational and compliance matters, including licensing requirements, regulatory filings, employment agreements, non-compete agreements, vendor contracts, and commercial lease reviews. Our goal is to provide a solid legal foundation that supports your business’s growth and long-term success.

When forming a new business in Texas, selecting the appropriate legal structure is crucial for future success and personal liability protection. Our attorneys provide tailored advice to entrepreneurs, startups, and established businesses, helping them choose from options like LLCs, corporations, partnerships, LLPs, PLLCs, and sole proprietorships. Beyond initial formation and compliance, we also assist with ongoing operational matters, ensuring a solid legal foundation for your business’s growth and long-term success.

Whether you’re starting a new venture, restructuring an existing business, or transitioning ownership, our attorneys deliver clear advice and personalized solutions tailored to your specific needs. Contact us today to discuss the best structure for your business and how we can help you establish it efficiently and effectively.

Case Law Highlights: Business Formation

Choosing the right business entity involves far more than filing formation documents. Texas courts have repeatedly clarified that issues like profit-sharing, governance, and member expectations must be handled clearly from the outset, or litigation can arise over everything from ownership rights to corporate control. Texas appellate decisions provide critical guidance on these formation-stage concerns.

Ingram  v.  Deere,  288  S.W. 3d  886  (Tex.  2009) 

The Texas Supreme Court tossed out a verdict and reinstated a take‑nothing judgment after finding no legally sufficient evidence that two doctors had formed a partnership to run their pain‑management clinic. Interpreting the Texas Revised Partnership Act, the Court held that partnership status turns on a totality‑of‑the‑circumstances test in which all of the five statutory factors, profit sharing, expression of intent, mutual control, agreement to share losses, or capital contribution, are weighed.

Here, the evidence failed on several fronts: the doctors split gross receipts without tying their shares to expenses (no profit or loss sharing); the alleged “partner” checks were labeled “contract labor” (no intent); one doctor alone managed the clinic (no mutual control); and the other supplied no capital. Because the claimant could not prove any factor, the jury’s partnership finding could not stand and all fiduciary‑duty and contract claims collapsed with it.

Ritchie v. Rupe, 443 S.W.3d 856 (Tex. 2014)

Although often cited for shareholder oppression claims, Ritchie v. Rupe also carries weighty implications for business formation, especially in drafting governing documents. The case arose from a minority shareholder’s claim that she was being frozen out of the company and prevented from selling her shares. She argued that the majority shareholders were acting oppressively by refusing to cooperate with any potential third-party sale.

The Texas Supreme Court declined to recognize shareholder oppression as an independent cause of action. Instead, it emphasized that any protection for minority owners must come from the company’s bylaws, shareholder agreements, or fiduciary principles. The Court held that the company had no duty to repurchase shares absent a contractual obligation to do so and that vague fairness concerns could not override the entity’s governing documents.

For those forming LLCs, corporations, or closely held entities, Ritchie illustrates a clear message: get it in writing. Without specific exit provisions, buy-sell clauses, or minority protections built into the company’s formation documents, owners may find themselves locked into business relationships with no guaranteed remedy or liquidity option.