Latest Publications


Do Mandatory Retirement Age Requirements For Directors Violate California Law?

While the Securities and Exchange Commission requires disclosure of the ages of directors (Item 401(a), Regulation S-K), it does not impose any age limitations on directors. Nonetheless, many public companies have adopted...more

Did The Last Viking Sell Securities?

I have recently been reading Stephen R. Bown's book, The Last Viking: The Life of Roald Amundsen. Readers may recall that it was the Norwegian Amundsen who famously beat the Englishman Robert Falcon Scott to the South Pole...more

5/24/2018  /  SEC , Securities

Judge Juxtaposes California And Delaware Insider Trading Law

I have written about Judge Claudia Wilken's recent ruling that the internal affairs doctrine does not supplant California's insider trading statute, Corp. Code § 25402. In re McKesson Corp. Derivative Litig., 2018 U.S. Dist....more

Federal Judge Applies California Insider Trading Statute To Delaware Corporation

Attentive readers of this blog should be aware that California included an insider trading statute (Corp. Code § 25402) as part of the Corporate Securities Law of 1968. More than a dozen years ago, a California Court of...more

A Field Guide To Corporations And Domestic Corporations

Some may be surprised to learn that a corporation need not be formed under the California General Corporation Law to qualify as a "domestic corporation". Corporations Code Section 167 defines "domestic corporation" to be "a...more

Has The DBO Misstated This Statute?

The California Department of Business Oversight administers and enforces the California Financing Law (fka Finance Lenders Law). Visitors to the DBO's website will find a basic description of the CFL, including the following...more

Why "Transfer or Hypothecate"?

Section 204(b) permits the articles of incorporation to include reasonable restrictions upon the right to transfer or hypothecate shares of any class or classes or series. This is the only time the word "hypothecate" appears...more

Caremark Claims And California

A popular claim for plaintiffs in derivative litigation against directors of Delaware corporations has been that the directors breached their duty of oversight. This theory has its genesis in Chancellor William T. Allen's...more

The SEC's New C&DI And Cumulative Voting

Last Friday, the staff of the Securities and Exchange Commission issued 45 new Compliance & Disclosure Interpretations relating to proxy solicitations and related schedules. One of these dealt with the issue of cumulative...more

The Cancelled LLC - What Is Thy Power?

To call the California Revised Uniform Limited Liability Company Act "quirky" would be to pay it an unmerited compliment. Take, for example, the provisions governing dissolution....more

DBO Issues Phishing Warning

The Department of Business Oversight recently published a warning to beware of "phishing" schemes. The DBO points out that it sends its Monthly Bulletins and other time-sensitive communications through its list host,...more

State Has No Clue As To How Much Board Gender Mandate Will Cost

Several previous posts have highlighted a bill that would impose a gender mandate with respect to the boards of directors of publicly traded corporations that maintain their principal executive office in California. Having...more

Secretary Of State Finds Business Chatbots And Online LLC-1 Filings

The California Secretary of State's office yesterday announced two improvements to its business website. The first is "Eureka" which is intended to allow the public to navigate the Secretary of State's website using...more

Will "Best Interest" Preempt Fiduciary Duties?

Last month, the Securities and Exchange Commission proposed to established a standard of conduct for broker-dealers when making a recommendation of any securities transaction or investment strategy involving securities to a...more

The Case Of Stolen Par Value

The concept of par value has largely fallen into desuetude. Thus, I was surprised to see a Nevada Supreme Court opinion dealing with stolen par value. I can understand stealing par value shares, but how does anyone steal...more

SEC Announces Launch Of SALI; What About The States?

Earlier this week, the Securities and Exchange Commission announced the launch of a new online tool for investors. The SEC describes this tool as follows...more

When Demanding Inspection, Don't Overlook The Demand

The wheels of justice turn slowly. Two years ago, I wrote about Judge Robert C. Jones's ruling in Weinfeld v. Minor, 2016 U.S. Dist. LEXIS 30117 (D. Nev. Mar. 8, 2016). In that ruling, Judge Jones tackled tackled the...more

Is The Codification Of A Director's Standard Of Care A "Liability Created By Law"?

By codifying the standard of performance of directors in Corporations Code Section 309 did the legislature create a liability by law? ...more

Does New York's Martin Act Conflict With California's Blue Sky Law?

A recent dispute between plaintiffs domiciled in California and defendants domiciled in New York caused U.S. District Court Judge Arthur D. Spatt to ponder whether to apply New York's Martin Act or California's Corporate...more

Pay Ratios And Sustainability

California Senator Benjamin Allen would like to establish an Office of Sustainability within the Governor’s Office of Business and Economic Development, also known as GO-Biz. His bill, SB 950, would require the Office of...more

Can California Dictate The Composition Of Foreign Corporations?

Senator Hannah-Beth Jackson's effort to mandate the number of female directors recently passed out of the Senate Committee on Judiciary. That should not be too surprising as Senator Jackson chairs the committee. The bill's...more

Federal Regulator's Departure Foments Move To Tighten Oversight Of Finance Lenders

Richard Cordray's resignation last fall as head of the federal Consumer Financial Protection Bureau may result in more stringent regulation of California Finance Lenders. In February, Assemblymember Monique Limón introduced...more

Insurance Or Indemnity?

Suppose you desire to place your prized collection of bibelots into storage. The storage company offers an to assume the risk of loss for an additional monthly payment. Have you entered into...more

Legislator Wants University Study Of Diversity At California High Technology Companies

California Assemblymember Chris Holden has authored a bill that would require the University of California to conduct a study of the racial and ethnic diversity of the board of directors and employees of California high...more

The Memberless LLC And Diversity

When faced with someone who is blowing things out of proportion, one response might be "Don't make a federal case out of this!" Sometimes, it may not even be possible to make a federal case. The reason is that federal...more

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