Must a professional company disclose its membership's professional status?

Full Question:

If a professional orginization has a membership of roughly 20% of that profession, would failure to disclose that information to a government body who is enacting sweeping changes that severly affect that profession potentially be considered fraud?
11/11/2009   |   Category: Corporations ยป Professional...   |   State: Florida   |   #19576

Answer:

Your question does not detail what type of professional organization is at issue. Florida statutes regulate how professional corporations (PC) and professional limited liability companies (PLLC) are created and maintained.

Currently, the Florida law restricts a PC or PLLC to render services only within a single, state-licensed profession. These entities generally may not conduct any other business, and must comply with particular conventions in its choice of its name.

Here are two relevant sections of the relevant Florida statutes that regulate professional companies:

621.12 Identification with individual shareholders or individual members.--

(1) The name of a corporation or limited liability company organized under this act may contain the last names of some or all of the individual shareholders or individual members and may contain the last names of retired or deceased former individual shareholders or individual members of the corporation, limited liability company, a predecessor corporation or limited liability company, or partnership.

(2) The name shall also contain:

(a) The word "chartered"; or

(b)1. In the case of a professional corporation, the words "professional association" or the abbreviation "P.A."; or

2. In the case of a professional limited liability company, the words "professional limited company" or the abbreviation "P.L.," in lieu of the words "limited company" or the abbreviation "L.C." as otherwise required under s. 608.406.

(3) In the case of a corporation, the use of the word "company," "corporation," or "incorporated" or any other word, abbreviation, affix, or prefix indicating that it is a corporation in the corporate name of a corporation organized under this act, other than the word "chartered" or the words "professional association" or the abbreviation "P.A.," is specifically prohibited.

(4) It shall be permissible, however, for the corporation or limited liability company to render professional services and to exercise its authorized powers under a name which is identical to its name except that the word "chartered," the words "professional association" or "professional limited company," or the abbreviations "P.A." or "P.L." may be omitted, provided that the corporation or limited liability company has first registered the name to be so used in the manner required for the registration of fictitious names.

 

621.09 Limitation on issuance and transfer of ownership.--

(1) No corporation organized under the provisions of this act may issue any of its capital stock to anyone other than a professional corporation, a professional limited liability company, or an individual who is duly licensed or otherwise legally authorized to render the same specific professional services as those for which the corporation was incorporated. No shareholder of a corporation organized under this act shall enter into a voting trust agreement or any other type agreement vesting another person with the authority to exercise the voting power of any or all of that person's stock.

(2) No person shall be admitted as a member of a limited liability company organized under this act, unless such person is a professional corporation, a professional limited liability company, or an individual, each of which must be duly licensed or otherwise legally authorized to render the same specific professional services as those for which the limited liability company is organized. No member of a limited liability company organized under this act shall enter into any type of agreement vesting another person with the authority to exercise any of that member's voting power in the limited liability company.