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californiacorporate&securities 10/20/2017
Professor Bainbridge Precises Corporate Philanthropy

Earlier this week, UCLA Law School Professor Stephen Bainbridge precised the question of corporate philanthropy.  He notes “Virtually all states have adopted statutes specifically granting corporations the power to make charitable donations, which eliminates the ultra vires issue.”  Several years back, I compared California’s and Delaware’s statutes: Delaware’s statute appears to be more limited than California’s…

The post Professor Bainbridge Precises Corporate Philanthropy appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/19/2017
California And Virtual Annual Meetings

Seventeen years ago, Delaware amended Section 211 of the Delaware General Corporation Law to permit corporations to hold electronic meetings of stockholders.  72 Del. Laws, c. 343, §§ 7, 8.  In the ensuing years, an increasing number of corporations have elected to conduct their meetings either entirely (a “virtual meeting”) or partially (a “hybrid meeting”) through electronic…

The post California And Virtual Annual Meetings appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/18/2017
Las Vegas’ Airport And The Lawyer Who Went “All In” For His Client

Passengers flying to Las Vegas arrive at the McCarran International Airport.  Having spent my youth in Las Vegas, I have many memories of going to the airport to greet arriving family or to fly East for school.  Then, there was no passenger security screening and no jetway bridges to the planes.  Family members could say goodbye or…

The post Las Vegas’ Airport And The Lawyer Who Went “All In” For His Client appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/17/2017
What Kind Of California Corporation Must Include A Salary Limitation In Its Articles Or Bylaws?

I suspect that at least a few California corporate lawyers are unaware of a provision in the California Corporations Code requiring the articles or bylaws of certain corporations to contain a limitation on the salaries paid to the persons operating or employed by the corporation, including officers and directors.  If you are guessing that this provision is included…

The post What Kind Of California Corporation Must Include A Salary Limitation In Its Articles Or Bylaws? appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/16/2017
Filing Statements Of Information Online

Last June, the California Secretary of State’s office announced bizfile California, which it described as “a new online portal to help businesses file, search, and order business records quickly and conveniently from one webpage”.  Bizfile California currently permits limited liability companies to file electronically the following: Initial LLC Statement of Information Required Periodic LLC Statement…

The post Filing Statements Of Information Online appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/13/2017
What Is A Foreign Registrant And Why Must They Translate Their Names?

Earlier this week, the Securities and Exchange Commission proposed amendments to Regulation S-K, and related rules and forms.  According to the SEC, these are intended to modernize and simplify certain disclosure requirements in a manner that reduces the costs and burdens on registrants while continuing to provide all material information to investors.  While I view…

The post What Is A Foreign Registrant And Why Must They Translate Their Names? appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/12/2017
Standard Of Review Is Clear For Administrative Interpretations Of Statutes And Rules

A few days ago, I noted the Court of Appeal’s opinion in Davis Test Only Smog Testing v. Dept. of Consumer Affairs, 2017 Cal. App. LEXIS 855.  That post concerned the Court’s holding that the plaintiffs’ due process rights had not been violated by lay representation at an administrative hearing.  Not discussed in the post was the Court’s handling of…

The post Standard Of Review Is Clear For Administrative Interpretations Of Statutes And Rules appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/11/2017
A Town Without Written Leases And No Litigation

Recently, I visited Tonopah, Nevada, which is located about midway between Las Vegas and Reno.  According to legend, the town was founded after Jim Butler discovered a rich ledge of silver ore while chasing his wandering burros.  Historians can, and do, debate the accuracy of this tale, but the silver was indubitably real.  Reportedly, the Tonopah mining district ultimately…

The post A Town Without Written Leases And No Litigation appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/10/2017
Section 25401 – Does No One Know Its History?

A few years back, I criticized the amendment of California Corporations Code Section 25401 to conform to Rule 10b-5 under the Securities Exchange Act of 1934.  See California Creates Complete Chaos By Rewriting Anti-Fraud Statute, But “We Are Against Fraud Aren’t We?  At the time, I observed:  Apparently, the legislature didn’t recognize that Section 25501…

The post Section 25401 – Does No One Know Its History? appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/9/2017
Attention Investment Advisers: Rules Are Not Statutes

Last week, I cautioned the students in my Securities Regulation class that while it can be helpful to review the SEC filings of other registrants, one should never assume that they are correct.  A few days later, I noticed that the following statement in Item 10 of numerous brochures filed by investment advisers: All material conflicts…

The post Attention Investment Advisers: Rules Are Not Statutes appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/6/2017
NASAA Issues Report On State Enforcement Actions

“Nothing but blue skies From now on” The North American Securities Administrators Association recently released its annual enforcement report.  The report is based on a survey of the 50 state members of NASAA.  The states report data based on either the calendar year or their own fiscal year.  Some highlights of the report are: Nearly 80%…

The post NASAA Issues Report On State Enforcement Actions appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/5/2017
Attorney General Opines On Lay Representation At Administrative Hearings

Over three years ago, I wrote that California’s Office of Administrative Hearings had requested the California Attorney General provide an opinion answering the following question: Does the Administrative Procedure Act (Gov. Code, §§ 11340-11529) authorize a party to a proceeding conducted by the Office of Administrative Hearings to be represented by a person who is not…

The post Attorney General Opines On Lay Representation At Administrative Hearings appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/4/2017
Nevada Now Requiring Director Names Upon Incorporation

Until this month, incorporators of Nevada corporations were required to file an initial list of its officers and directors on or before the last day of the first month after filing the initial articles of incorporation (unless the corporation selected an alternative due date (See NRS 78.150 & NAC 78.300 – .380)).  Reportedly, many incorporators failed to file…

The post Nevada Now Requiring Director Names Upon Incorporation appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/3/2017
Delaware Special Litigation Committee Review “Could Stand A Good Tweaking”

UCLA Law School Professor Stephen Bainbridge recently critiqued the Nevada Supreme Court’s decision to follow Auerbach v. Bennett, 419 N.Y.S.2d 920 (1979) rather than Delaware’s Zapata Corp. v. Maldonado, 430 A.2d 779 (Del. 1981).  He concludes: To be sure, Delaware law in this area could stand a good tweaking. The Aronson/Zapata framework continues to rely unduly on…

The post Delaware Special Litigation Committee Review “Could Stand A Good Tweaking” appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 10/2/2017
New California Law Seeks To Root Out Juror Bias, But What Would Calvin H. Higbie Say?

The right to a jury trial in criminal cases is guaranteed by the Sixth Amendment to the U.S. Constitution and by Article I, Section 16 of the California Constitution.  Implicit in the requirement of a jury is the idea that the jurors will exercise unbiased and intelligent judgments.  Empaneling such a jury is a challenge.…

The post New California Law Seeks To Root Out Juror Bias, But What Would Calvin H. Higbie Say? appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 9/29/2017
Does The SEC Have Exposure For Tipping Inside Information?

Yesterday, I discussed the recent hack of the Securities and Exchange Systems’ electronic filing and retrieval system commonly referred to as EDGAR.  In a written statement disclosing the hack, Chairman Jay Clayton speculated that the incident may have provided a basis for “illicit gain through trading”.  Professor Peter Henning and others have observed that the…

The post Does The SEC Have Exposure For Tipping Inside Information? appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 9/28/2017
Hacking EDGAR And Insider Trading

SEC Chairman Jay Clayton launched a sea of news stories last week when he included the following five sentence in a statement on cybersecurity: Notwithstanding our efforts to protect our systems and manage cybersecurity risk, in certain cases cyber threat actors have managed to access or misuse our systems.  In August 2017, the Commission learned…

The post Hacking EDGAR And Insider Trading appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 9/27/2017
How To Win Custody Of A Corporation

In family law, the fights are often over who gets custody of the kids, the pets and the house.  Shareholders battle over many things, but you don’t often hear of custody fights in the corporate context.  Is it even possible to win custody of a corporation?  In Nevada, the answer is yes. NRS 78.347 allows any stockholder to apply to…

The post How To Win Custody Of A Corporation appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 9/26/2017
Staff Addresses Family Trusts With Multistate Trustees

When the Securities and Exchange Commission two years proposed amendments to Rule 147 and adoption of Rule 147A, I commented on an issue that I foresaw with respect to family and other non-business trusts: Proposed Rule 147 does not address how the residency of non-business trusts should be determined. Many individual investors purchase securities by means…

The post Staff Addresses Family Trusts With Multistate Trustees appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 9/25/2017
Binary Options And Securities Regulation

Recently, the North American Securities Administrators Association (NASAA) updated and expanded its 2015 advisory warning investors about online binary option schemes.  NASAA offers the following explanation of “binary options”: A binary option is a type of all-or-nothing investment contract, similar to placing a bet. Like the flip of a coin, there are only two possible outcomes: heads…

The post Binary Options And Securities Regulation appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 9/25/2017
Nevada Supreme Court Adopts Delaware’s Direct Harm Test For Derivative Claims

On the same day that the Nevada Supreme Court rejected Delaware’s approach to reviewing special litigation committee determinations, it adopted Delaware’s test for determining whether a shareholder suit is derivative or direct.  Parametric Sound Corp. v. Eighth Judicial District Court, 133 Nev. Adv. Op. 59 (2017).  When shareholders sue officers and directors, they may pursue direct…

The post Nevada Supreme Court Adopts Delaware’s Direct Harm Test For Derivative Claims appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 9/22/2017
Did The SEC’s Pay Ratio Guidance Miss Conjunction Junction?

Last week, the Securities and Exchange Commission issued interpretive guidance to assist issuers in complying with the pay ratio rule.  At the same time, the Division of Corporation Finance staff issued guidance concerning how companies might use statistical sampling technologies and “other reasonable methods” in implementing the pay ratio rule.  I am sure that both…

The post Did The SEC’s Pay Ratio Guidance Miss Conjunction Junction? appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 9/21/2017
California Bill May Spur Rewriting Gender Boilerplate

On the penultimate day of the current session, the California legislature passed SB 179 (Atkins & Wiener).  If signed into law by Governor Brown, this bill would enact the California Gender Recognition Act.  In general, SB 179 would create a third, nonbinary gender option on a California driver’s license, identification card, and birth certificate.  It also would…

The post California Bill May Spur Rewriting Gender Boilerplate appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 9/20/2017
Does California Side With Delaware Or New York On Special Litigation Committee Reviews?

As discussed in the two preceding posts, Nevada’s Supreme Court last week decided to adopt New York’s standard of review of special litigation committee recommendations to dismiss stockholder derivative suits.  In re Dish Network Derivative Litigation, 133 Nev. Adv. Op. 61 (2017).  The New York Court of Appeals described this standard as follows: While the substantive aspects of a…

The post Does California Side With Delaware Or New York On Special Litigation Committee Reviews? appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
californiacorporate&securities 9/19/2017
Review Of Special Litigation Committee Recommendations

Yesterday’s post limned the Nevada Supreme Court’s adoption of New York’s Auerbach standard of review for special litigation committee recommendations.  In re Dish Network Derivative Litigation, 133 Nev. Adv. Op. 61 (2017).  The Supreme Court unequivocally required that the trial court apply Auerbach at an evidentiary hearing : Pursuant to Auerbach, 393 N.E.2d at 996, and consistent with…

The post Review Of Special Litigation Committee Recommendations appeared first on CALIFORNIA CORPORATE & SECURITIES LAW.

 
Blogs 1 - 25 of 1000