BusinessBad Ideas
Litigation Scenarios
Prox OS documentation reference.
Scenario Table
| Scenario | Trigger | Damage | Clean prevention |
|---|---|---|---|
| Contributor later sues for unpaid salary | Role looked like employment but was documented poorly. | Wage claim, tax/social security issues, relationship damage. | Clear contributor/contractor agreement and no fake salary language. |
| Friend nominee refuses to transfer shares | Hidden ownership or informal nominee structure. | Loss of control, investor diligence failure. | Transparent ownership and reviewed agreements. |
| Employer claims contributor code | Work done on employer time/equipment or using employer materials. | Code removal, rewrite cost, IP dispute. | Clean-room contribution policy and logs. |
| Tax authority rejects fake expense logic | Personal costs booked as business. | Tax adjustments, penalties, credibility damage. | Real expenses, evidence, accountant review. |
| Investor due diligence finds IP is dirty | Contributor IP or license trail unclear. | Financing delay or failure. | IP assignment, clean-room records, release evidence. |
| China company books are messy and block investment | Local operations started without accounting discipline. | Diligence, tax, and control problems. | Use local professionals and keep clean books from day one. |