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Is This Proposed Amendment To Delaware’s Stockholder Consent Statute Really Needed?

Recently, I wrote about a proposal to amend Section 141(f) of the Delaware General Corporation Law to permit inchoate directors to take action by written consent. The Corporation Law Section of the Delaware State Bar is...more

4/18/2014 - Board of Directors Delaware General Corporation Law Proxies Shareholders Written Consent

Directors’ Alleged Breach Of Fiduciary Duty Not Subject To Anti-SLAPP Statute

A SLAPP is a strategic lawsuit against public participation. California enacted Code of Civil Procedure Section 425.16 as an antidote to SLAPP suits. In general, a SLAPP is subject to a special motion to strike unless the...more

4/17/2014 - "homeowners Anti-SLAPP Board of Directors Directors Fiduciary Duty Standard Pacific

This Proposed Amendment To DGCL Section 141(f) Is A Curate’s Egg

In AGR Halifax Fund, Inc. v. Fiscina, 743 A.2d 1188 (1999), the Delaware Court of Chancery was asked to decide whether a consent given by persons before they became directors could become effective if delivered to the...more

4/16/2014 - Board of Directors Consent Corporate Counsel Corporate Governance

Can The Political Concerns Of Corporate Officers Be Of Any Concern Of The Corporation?

Suppose a corporation’s Chief Executive Officer becomes involved in a particularly abhorent (but legal) political movement. Suppose further that the Board of Directors is concerned that the corporation’s stockholders,...more

4/11/2014 - Board of Directors CEOs Political Expression

Just Who Is Behind The Universal Proxy?

Recently, it was reported that the Council of Institutional Investors had submitted a petition for rule making to the Securities and Exchange Commission. Indeed, the CII did submit this petition on January 8, 2014. ...more

1/22/2014 - Ballots Board of Directors CII Directors Proxies SEC

“Wherever You Go, There You Are”, But Will You Be In The Proper County?

The California General Corporation Law makes numerous references to the “proper county”. For example, Corporations Code Section 304 empowers the superior court of the proper county to remove a director in specified...more

12/18/2013 - Board of Directors Corporate Governance Directors

An Unexpected Impasse

If a corporation has four directors and two shareholders, one owning 60 shares and the other owning 40 shares, it seems obvious that the majority shareholder should be able to elect a majority of the board of directors. ...more

11/13/2013 - Board of Directors Directors Shareholder Votes Shareholders

Deadlocked But Not Out Of Options

While not prohibited by the General Corporation Law, a board comprised of an even number of directors suffers from one potential disability. It can become deadlocked. When that unfortunate situation arises, there are...more

11/12/2013 - Board of Directors Corporate Governance Directors Disability

Court Of Appeal Holds Breach Of Fiduciary And Conflict Of Interest May Be Grounds For Summary Election Challenge

Section 709 of the California Corporations Code creates a summary procedure that allows any shareholder or any person who claims to have been denied the right to vote to petition the Superior Court for a determination of the...more

10/11/2013 - Board of Directors Conflicts of Interest Corporate Governance Fiduciary Duty Shareholder Votes Shareholders

When Directors Are Or Become Bad Actors . . .

I’ve devoted several blog posts to the multifarious problems engendered by the SEC’s new “bad actor” disqualification provisions. I’ve done so because Rule 506(d) is so poorly drafted that, like the annals of Volusius, its...more

10/4/2013 - Bad Actors Board of Directors Disqualification Private Offerings Rule 506 Offerings SEC

Senators Pass Gender Diversity Resolution – Have They Read Ecclesiazusae?

In late August, the California Senate approved SCR 62 which encourages “equitable and diverse gender representation on corporate boards”. The resolution also urges...more

9/9/2013 - Board of Directors Diversity Gender Equity New Legislation Women in the Law

Must Designated Directors Keep A Secret?

Yesterday’s post concerned the attorney-client privileged issues in Vice Chancellor J. Travis Laster’s recent decision in Kalisman v. Friedman, 2013 Del. Ch. LEXIS 100 (April 17, 2013). I found another statement in the...more

7/11/2013 - Board of Directors Confidentiality Controlling Stockholders Directors Disclosure Personal Representatives Shareholder Rights Shareholders

Kalisman v. Friedman – A California Analysis

A few months ago, Vice Chancellor J. Travis Laster issued an interesting decision involving director inspection rights and the attorney-client privilege. Kalisman v. Friedman, 2013 Del. Ch. LEXIS 100 (April 17, 2013). ...more

7/10/2013 - Attorney-Client Privilege Board of Directors Corporate Governance Corporate Officers Directors Duty of Loyalty Incorporation Inspections

Another Possible Exception To Exclusive Forum Bylaws

Yesterday, I discussed several vulnerabilities of exclusive forum bylaws should they be challenged in California. The California General Corporation Law includes many provisions that expressly subject foreign corporations to...more

6/28/2013 - Board of Directors Bylaws Corporate Governance Foreign Corporations

LLC Has No First Amendment Right To Send Its Lawyer To Board Meetings

Usually when someone invokes her right to counsel, she usually has in mind the Sixth Amendment of the U.S. Constitution (or perhaps Article I, § 15 of the California Constitution). Thus, I was surprised to see a case in...more

6/20/2013 - Board of Directors First Amendment LLC Right To Counsel

Corporations Code Reaches Contracts And Conveyances By Foreign Corporations

Corporations Code Section 313 generally provides that in the absence of actual knowledge of lack of authority, a contract executed by a corporation is not invalidated by any lack of authority of the signing officers provided...more

5/29/2013 - Applications Board of Directors Foreign Corporations

No Directors, No Officers, No Employees And No Agents – Now What?

Occasionally, a corporation may find itself with no directors and no management. Yet, the corporation does not cease to exist. One might wonder what use can there be in a corporation deprived of head and limb. In...more

5/3/2013 - Agents Attorney-Client Privilege Board of Directors Discovery Officers Waivers

Can A Director Consent By Email?

The California General Corporation Law authorizes board action by written consent. Cal. Corp. Law § 307(b). Sometimes, I’ve been asked about signing an email consent. Section 17 of the Corporations Code (which governs, but is...more

12/26/2012 - Board of Directors Directors Electronic Communications Email Written Consent

Does A Lawyer Who Files A Derivative Action Have An Attorney-Client Relationship With The Corporation?

Because the California Corporations Code requires that the business and affairs of a corporation be managed by or under the direction of its board of directors, any decision of whether a corporation should bring suit on...more

12/20/2012 - Attorney-Client Privilege Board of Directors Derivative Suit Shareholder Litigation

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