KEN KIRSCHENBAUM, ESQ ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE You can read all of our articles on our website. Having trouble getting our emails? Change your spam controls and white list ken@kirschenbaumesq.com ****************************** Start-up contractual needs / Class action inquiry July 27, 2021 ************************* Start-up contractual needs ************************* Ken We're a new security provider and focusing solely on on-line / DIY home security sales and monitoring. We will be using the Alarm.com platform with monitoring provided by COPS. My question is what contracts would you suggest we need to start off? We will only be selling and monitoring in the states we are licensed in which are Georgia and Florida. Jason *************************** Response *************************** You are off to a great start. Alarm.com offers a great platform and COPS is a great central station. DIY is a wide-open market and Florida and Georgia are booming. You're contractual needs run from advisable to essential. Here are the advisable agreements you'll need: * your business entity should be corporation, Sub S election, or LLC and only in special circumstances a C Corp. After your tax consultant confirms the best option for you [and he better have good reason not to be sub S] you need to file for your entity in one state and then file a certificate for authority to do business in the other state. If you are an LLC you need an Operating Agreement. If corporation with more than one stockholder, you need a shareholders agreement. * Rider to Central Station Dealer Agreement. Every central station dealer agreement needs some modification and negotiation. The Rider to Central Station Agreement has all the issues you need laid out. This is an advisable form every alarm company using a wholesale central station should get and use, with a new relationship and a renewing relationship. These are your essential contract forms: * Residential All in One for Florida. You can leave the form as is or modify it to remove provisions that may not apply. * Residential All in One for Georgia. [you could get the Nationwide DYI form but you don't need it for two states] * alarm.com rider. Alarm.com dealers have to get their customers to sign the alarm.com terms * Disclaimer Notice Final recommendation: Join the Concierge Program and establish a relationship with K&K. Best of luck in your new venture; it's a great industry to be in. **************************** Class action inquiry **************************** Ken How much would it cost to start a class action lawsuit against an alarm company and how many customers would we need for proof to initiate it? A Huge company we want to go after is: 1. Telling customers after 3 years that they signed a 5 year contract without their acknowledgement. 2. Telling customers if they agree to lower the bill a little bit verbally over the phone they must extend agreement for 2-5 years more. 3. If a customer has a problem with equipment that is supposed to have a warranty as promised from beginning and they want it fixed they must extend their contract verbally. 4. Telling customers that want to cancel in general when they never agreed to an extended contract that they are still in one for 2-3 years and must pay 1100-1500 dollars. 5. Customers telling the company they want to go with a new company and telling the customer they got scammed, we are a scam tricking them to stay. 6. When customers request a copy of their agreement or a recording to show proof Company cannot provide one. A lot of customers are in collections because of these unethical practices, they are highly upset because They are forced to stay with a company that they are not happy with and do not recall agreeing verbally to extend a contract for such a long time. Company is only in 1 state that makes it legal to verbally bind a customer IF they even agreed to it, hence most of these customers live in other states that do not abide by these said laws. The company should be held accountable for deceitful, unethical, scare tactics, scamming business practices taking advantage of good people who just wanted to be dealt with by a good company but instead have become a victim. I got into the alarm business to protect people by securing their homes from getting robbed and now I feel obligated to protect them from getting robbed by their own alarm company in plain sight. This is not for the money but it's for the thousands of people who have and are still till this day getting robbed right underneath there feet. Please let me know your thoughts. Thank you. Name withheld *************************** Response *************************** Wow, that's quite an indictment. Hard to believe this has escaped the attention of your attorney general. If you were in NY all you would have to do is let the NY Attorney General know that Trump was running this company and she'd be all over it immediately. But your quest should start by having a customer complain to the state Attorney General or local consumer affairs. They should investigate and take appropriate action if your allegations are accurate. You have no standing to pursue a class action unless you are one of the victimized customers. If there are more than 250 or so they have enough for a class action. There are attorneys who specialize in class actions, though this case would likely have marginal interest. If they take the case they typically work on contingency; they foot the bill. If you wants to fund a class action the cost would likely be $25,000 to $50,000 plus costs which could be expensive if the Court orders advertising and printing of notices to the public and class. I suggest you stick to building your business with less focus on other's business. ****************************** To order up to dateStandard Form Alarm / Security / Fire and related Agreements, click here: www.alarmcontracts.com ************************* CONCIERGE LAWYER SERVICE PROGRAM FOR THE ALARM INDUSTRY You can check out the program and sign up here: https://www.kirschenbaumesq.com/page/concierge or contact our Program Coordinator Stacy Spector, Esq at 516 747 6700 x 304. *********************** NOTICE: You can always read our Articles on our website at ww.kirschenbaumesq.com/page/alarm-articles *********************** THE ALARM EXCHANGE
This area is reserved for alarm classifieds, alarm company announcements, solicitations, offers, etc. There is no charge to post a listing here.Include your contact information, phone, email and web site. If you would like to submit a post, please send an email to ken@kirschenbaumesq.com. To create a reciprocal link to our website, click here. ************************************************ Getting on our Email List / Email Articles archived: Many of you are forwarding these emails to friends or asking that others be added to the list. Sign up for our daily newsletter here: Sign Up. You can read articles and order alarm contracts on our web site www.alarmcontracts.com ************************** Ken Kirschenbaum,Esq Kirschenbaum & Kirschenbaum PC Attorneys at Law 200 Garden City Plaza Garden City, NY 11530 516 747 6700 x 301 ken@kirschenbaumesq.com www.KirschenbaumEsq.com
