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The $1 Billion Registered Agent Debacle

Nearly every business is required by law to have a “Registered Agent.” The primary role of a registered agent is to accept legal process and other notices. Often times, a business will name one of its owners or employees to be the registered agent as such can seem fairly innocuous. A recent case, however, established just how important it is to know what the role of a registered agent is and how to respond to documents received by a registered agent. On September 30, a Wisconsin state court awarded a $1.26 Billion, yes BILLION, dollar judgment against PepsiCo when PepsiCo failed to timely respond to a legal action served on PepsiCo’s registered agent. While PepsiCo has since been successful in getting the judgment vacated, such was not a sure thing, caused significant extra expenses, and was a corporate embarrassment. At JMFPC, we provide registered agent services for a low annual fee. We will be available for receipt of any process or notice and will make sure that your rights are preserved and that a plan is put into place to respond. At a minimum, if you or one of your employees is going to remain your registered agent, it is important to make sure that you understand the importantance of this role and to have a process to respond. Please call for more information.