The California General Corporation Law permits shareholders to take action by written consent, unless otherwise provided in the articles of incorporation. Cal. Corp. Code § 603(a). When shareholder action is taken by...more
In 1995, Panrox International (USA), Inc. recorded a deed of trust on a home in Los Angeles to secure an indebtedness of $141,000. On January 2, 2001, the State of California suspended Panrox for failure to pay taxes. ...more
Section 5342(e) of the California Corporations Code requires a nonprofit public benefit corporation to provide, upon the request of a member, to either allow inspection and copying of all members' names, addresses or voting...more
Nine years ago, I posed the question of whether the California General Corporation Law permits corporations to serve as directors. My answer at the time was "no" because Section 164 of the Corporations Code defines...more
Neither California's nor Delaware's General Corporation Law expressly prohibits directors from being represented by proxy at board meetings. However, it appears to have been well settled in Delaware since at least 1915 that...more
The California Nonprofit Mutual Benefit Corporation Law contemplates three different methods for members to take action: at a meeting, by ballot, and by unanimous written consent. Cal. Corp. Code §§ 7512(a), 7513 & 7516. ...more
Under the California General Corporation Law, a board of directors can take action in two different ways - at a meeting or by unanimous written consent. See Cal. Corp. Code § 307. Over a decade ago, I posed the question of...more
Professor Stephen Bainbridge recently tackled the question of whether the business judgment rule applies to a corporate board's selection of an expert. Section 141(e) of the Delaware General Corporation Law fully protects a...more
Ten years ago, I questioned in this space whether a Delaware forum selection charter provision would survive constitutional scrutiny if it involved a de facto waiver of a jury trial...more
In most cases, Generally speaking, only the record owners of shares on the record date are entitled to vote under the California General Corporation Law. As with most generalizations, however, there are exceptions. For...more
In a recent blog post on the Business Law Prof Blog, Tulane Law professor Ann M. Lipton opined...more
9/19/2023
/ Board of Directors ,
Breach of Duty ,
Cannabis-Related Businesses (CRBs) ,
Corporate Governance ,
Corporate Misconduct ,
Corporate Officers ,
Fiduciary Duty ,
Illegal Conduct ,
Marijuana ,
Shareholder Litigation ,
Shareholders
John Jenkins at DealerLawyers.com writes today about a decision by Vice Chancellor J. Travis Laster concluding that disparate voting rights based on the identity of the holders is permitted by the Delaware General Corporation...more
Section 908 of the California Corporations Code provides that when a California corporation files a certificate of amendment, the articles of incorporation shall be amended in accordance with the certificate and any stock...more
In California practice, a merger reorganization will typically involve two agreements - one short, the other not. The Corporations Code refers to the shorter agreement as the "agreement of merger". At a minimum it must...more
There are potentially a number of ramifications to classifying a board member as employee, including whether the corporation may be entitled to obtain a workplace violence restraining order petition pursuant to Section 527.8...more
The plaintiffs in Chan v. ArcSOFT, Inc., 2023 WL 2788585, believed that they had been misled in a buyout of their shares and so they sued the company and its Chief Executive officer. One of the plaintiffs, Marc Chan, did not...more
Section 309 of the California Corporations Code specifies the standard of performance applicable to directors in performing their duties as directors of corporations organized under the California General Corporation Law. ...more
A neophyte to corporate law might ask where is it written in the California General Corporation Law that directors and officers are fiduciaries. The answer is nowhere. In fact, the phrase "fiduciary duty" appears only once...more
One popular theory of the corporation is that it is a nexus of contracts. As Frank Easterbrook and Daniel Fischel pithily pronounced "Corporations are enduring (relational) contracts." F. Easterbrook and D. Fischel, The...more
Yesterday's post mentioned mentioned Chapter 17 of the California General Corporation Law which governs service of process in addition to the provisions of the California Code of Civil Procedure. Corporations Code Section...more
The California Code of Civil Procedure sets forth the general rules governing the service of summons. Cal. Code Civ. Proc. §§ 415.10 - 415.95. Chapter 17 of the General Corporation Law adds to these provisions. In some...more
In this post published yesterday, John Jenkins discussed a proposed Nasdaq rule regarding notification and disclosure of reverse stock splits. In light of John's post, I thought a brief refresher on California's treatment of...more
Historically, a meeting necessarily meant a physical encounter. Indeed, the word "meet" can be traced to the Anglo Saxon word metan which means to encounter or meet. So it was that shareholder meetings involved the presence...more
UCLA Law Professor Stephen Bainbridge recently answered the question of whether shareholders may remove a corporation's chief executive officer and chairman of the board from a Delaware perspective. Like Delaware, California...more
Section 204(a)(10) of the California Corporations Code permits the articles of incorporation to include provisions eliminating or limiting the personal liability of a director for monetary damages in an action brought by or...more