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CALIFORNIA CORPORATE & SECURITIES LAW

“See Spot Run”

Yesterday, I wrote about “spot” bills and the process of gutting and amending bills in the California legislature.  So why have a spot bill at all?  The reason is that the legislative process is supposed to operate according to specific procedures.  Each house of the legislature has its own rules and they have jointly adopted rules.  Under the Assembly’s rules, a member may only introduce 40 bills in a regular session.  Further, bills must be introduced by a specific date. A legislator can’t simply wake up one morning and introduce a bill. Therefore, when a legislator knows that he or she wants to introduce a bill but doesn’t yet know (or want to reveal) the exact text, he or she will introduce a bill before the deadline for submitting bills but make only an insignificant change such as changing “which” to “that” in the text of an existing statute. In subsequent blogs, I’ll discuss some other limitations on the bill and the infamous “gut and amend” that resulted in the California Corporate Disclosure Act.

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