Earlier this week, the staff of the SEC’s Division of Corporation Finance issued several new, and rewrote several existing, Compliance and Disclosure Interpretations (“C&DIs”) relating to Non-GAAP Financial Measures. ...more
Synecdoche is a literary trope by which one refers the whole by a component, or vice versa. The word is derived from an ancient Greek word, su?e?d???, which means understanding one thing with another. Although I was first...more
It might be reasonable to assume that a dissolved corporation no longer has any officer and directors. However, the California General Corporation Law seems to assume that dissolved corporations continue to have directors...more
Section 17701.13 of the California Corporations Code requires that a limited liability company designate and continuously maintain in California both an office and an agent for service of process. The office need not be a...more
Today, California regulates the offer and sale of securities more by exemption than qualification. In addition, California and other states have lost authority over a significant amount of securities transactions due to...more
I’ve previously written about how both California and Nevada have statutorily adopted the common law of England as the rule of decision for courts in those states. See Ahistorical Bedfellows: The California Corporations Code...more
Yesterday’s post concerned the circumstances that will cause the California Franchise Tax Board to suspend a corporation’s rights, powers, and privileges to conduct business in California. Suspension, however, is reversible,...more
Yesterday’s post concerned the two circumstances in which the Secretary of State might suspend a corporation. The California Franchise Tax Board will suspend a corporation if it fails to pay taxes, penalties, fees or...more
In California, a corporation may find its powers, rights and privileges suspended by either the Secretary of State or by the Franchise Tax Board. Today’s post discusses the two roads to suspension by the California Secretary...more
The LLC May Well Be The Platypus Of Business Organizations -
What happens to the attorney-client privilege when a corporation dissolves? Magistrate Judge Sallie Kim recently answered that question in Virtue Global...more
In an arms race, each suffers the worst result if it disarms and the other side remains armed. However, if both sides are armed, they are not as well off as when both sides are disarmed. This is, of course, the classic...more
The modern understanding of the term “outlaw” is someone who has broken the law and has not been captured and brought to justice. There is, however, another sense of the term. A note is said to be “outlawed” when the...more
In 2014, the Securities and Exchange Commission announced that all comment letters would request that the issuer include the so-called “Tandy Letter”. Thus, all staff comment letters include a request for a written statement...more
Some activists are continuing to submit stockholder proposals seeking the implementation of “simple majority voting”. For example, Morgan Stanley’s 2016 proxy statement includes the following proposal from Newground Social...more
When paying a dividend to shareholders, California corporations are subject to Chapter 5 of the California Corporations Code. Corporations incorporated in Delaware and other states may also be subject to Chapter 5 if they...more
Muttering About Mottoes -
The official motto of the State of California is “Eureka”. Cal. Gov’t Code § 420.5. The word is a transliteration of the Greek word e????a which is first person, singular, indicative active...more
Recently, I’ve written about the “absolute” right of shareholders to inspect the shareholders list pursuant to California Corporations Code Section 1600. Readers at, or representing, foreign corporations may have skipped...more
Nearly four years ago, I wrote about a Nevada Supreme Court decision holding that Nevada courts can exercise personal jurisdiction over nonresident officers and directors who directly harm the corporation. Consipio Holding,...more
Yesterday’s post discussed California’s “absolute” right of shareholders to inspect the shareholder list established by Section 1600 of the California Corporations Code. Some additional points are briefly worth noting...more
Section 1600(a) of the California General Corporation Law establishes the “absolute right” of a shareholder or shareholders to inspect the shareholder list. To be eligible to exercise this right, the shareholder or...more
April 23rd will be the anniversary of William Shakespeare’s birth in 1564. He died on the same date in 1616, making this the 400th anniversary of his death. Actually, the exact date of his birth is unknown, but it is...more
The Statue of Three Lies -
In Harvard Yard, there is a prominent bronze statue of a man sitting on a chair. The statue is the work of the prolific American sculptor Daniel Chester French. The statue is vaguely...more
The California Uniform Partnership Act of 1994 defines a “partnership” to mean “an association of two or more persons to carry on as coowners a business for profit formed under [Cal. Corp. Code] Section 16202, predecessor...more
Trusts are confusing. Fundamentally, a trust describes a relationship, not a person. Thus, the California Supreme Court has described a trust as “a fiduciary relationship with respect to property in which the person holding...more
California, unlike other states, has codified the attorney-client (and other evidentiary) privileges. Cal. Evid. Code §§ 900 et seq. In an opinion issued last week, the California Court of Appeal provided a nice summary of...more