Businesses should be wary of the business strategy that was used to obtain a business license, a federal judge ruled Monday.
In a ruling that is expected to be closely watched by business owners in California, U.S. District Judge Andrew S. Hanen said the strategy used to get a business or franchise to operate as a small business was “very deceptive” and “likely to mislead the business owner and the public.”
The strategy was used by the Small Business Administration, which was formed in 1978 to administer small business license requirements, and to set licensing standards and guidelines for the small business community.
The strategy is known as the “business strategy” and was created by the business license business strategy.
The strategy seeks to secure a business for its owner by claiming that the business has an “entrepreneurial spirit” and a “culture of openness.”
It is a tactic that is employed to gain a business through the use of a variety of tactics, including misrepresentations, misrepresentations of facts, misrepresentation of a person’s identity, and false or misleading statements.
The attorney general of California has argued that the strategy is deceptive and is likely to mislead.
Hanen said it was the “worst kind of deception.”
“The tactic of the Small and Disadvantaged Business Program is to create a false impression of your organization, a misrepresentation that your organization is a large corporation or an enterprise, a false claim of the existence of an enterprise in the vicinity of your location and a false statement that the applicant has been accredited by a business association that is a not-for-profit organization,” Hanen wrote.
The court said the tactics were “likely in direct contravention of California law.”
Hanen noted that the SBA does not conduct a business strategy study to evaluate the validity of the strategy and said it is “not unusual for business owners to receive guidance on how to avoid such tactics.”
The case was brought by the California Association of Business.