Every business owner starts out with a dream and usually a tight budget. In the early stages, DIY contracts, handshake deals, and internet templates might get the job done. But once your business starts to scale, what once worked can now cost you dearly.

We’ve seen it happen to companies all across Pittsburgh: a fast-growing business hits a revenue milestone, only to be dragged down by preventable legal issues.

Below are five of the most common legal mistakes we see founders make as they grow—and how to protect your business from them.

1. Failing to Revisit (or Create) Operating Agreements

You may have created a simple operating agreement (or skipped it entirely) when your business was just an idea between friends. But if you’re bringing in new partners, investors, or key hires, your old agreement could be dangerously outdated… or unenforceable.

Why It Matters:
Your operating agreement governs everything from profit distributions and decision-making authority to partner exits and ownership changes. A vague or absent agreement is a recipe for disputes, especially if one person wants out, and the others don’t agree on what happens next.

What to Do:
Have an attorney review and update your operating agreement regularly, especially before bringing in new equity holders or making major structural changes.

2. Ignoring Employment Law as the Team Grows

Many founders are quick to hire, but slow to implement proper HR practices. This includes missing employee handbooks, misclassifying workers, or failing to document performance issues.

Why It Matters:
A single wrongful termination claim, wage complaint, or harassment allegation can cause legal and financial havoc. In Pennsylvania, business owners are subject to both federal and state employment laws, even if they only have a handful of employees.

What to Do:
Develop compliant employee handbooks and job descriptions, clarify your employment classifications (employee vs. contractor), and document all employment decisions. Consult with counsel before terminating an employee to ensure you're not inviting legal exposure.

3. Using Generic Contracts or Templates from the Internet

It’s tempting to download a free contract and tweak the names. The problem? Generic templates don’t reflect the specifics of your business, industry, or state law, and can leave dangerous gaps.

Why It Matters:
We’ve seen Pittsburgh business owners lose deals, face lawsuits, or even accidentally sign away intellectual property because of contract language they didn’t fully understand.

What to Do:
Get your contracts reviewed, or better yet, drafted, by an experienced business attorney. That includes vendor agreements, service contracts, NDAs, partnership agreements, and any client-facing documents.

4. Delaying Legal Help Until Something Goes Wrong

This might be the most common (and costly) mistake we see: waiting to talk to a lawyer until after the damage is done. By the time a lawsuit is filed, an investor walks away, or a regulatory agency flags a problem, your options are limited, and your risk is higher.

Why It Matters:
Preventive legal work is almost always less expensive than legal damage control. Proactively setting up proper structures, agreements, and compliance processes protects your business and gives you leverage when things get tough.

What to Do:
Think of legal as part of your business strategy, not just a safety net. Schedule a legal check-in when you're entering a new phase of growth, launching a product, hiring your first employees, or bringing on a new partner.

5. Overlooking Intellectual Property Protection

Your brand name, content, logos, and proprietary methods may be some of your most valuable assets, and also the most vulnerable.  Too often, founders don’t think about trademarks, copyrights, or trade secrets until someone copies them, or until a cease-and-desist shows up in their inbox.

Why It Matters:
Without clear IP protections, someone else can claim rights to the identity or content you've built. And if you haven’t done your due diligence, you might be infringing on someone else’s rights without realizing it.

What to Do:
Secure trademarks for your brand name, product names, and logos. Copyright your original materials (web content, presentations, guides), and create clear internal policies to protect trade secrets. Run trademark clearance searches before launching new brand identities.

Bonus Tip: Get Local Counsel That Knows Pittsburgh Business

The Pittsburgh business landscape is unique. From family-run shops in Lawrenceville to high-growth tech startups in the Strip, your legal needs depend on your industry, size, and trajectory.

A local business attorney isn’t just someone who knows Pennsylvania law; they’re someone who understands the regional market, community relationships, and growth dynamics specific to Western PA.

Final Thoughts

Scaling a business is exciting, but also risky. The decisions you make now have long-term consequences for your team, your brand, and your bottom line. The good news? Most legal problems are avoidable with the right guidance and foresight.

At Cozza Law, we help business owners across Pittsburgh protect what they’ve built and grow with confidence. Whether you’re hiring your first employee, negotiating a major deal, or planning for long-term succession, we’re here to support you with clarity and confidence.

Ready to Take the Guesswork Out of Legal?

Schedule a consultation with our team. We’ll review where your business is now, where you're heading, and how to avoid the legal pitfalls that derail too many growing companies.

👉 Contact Cozza Law
📍 Proudly serving Pittsburgh businesses with legal strategy that scales.