No Right To Jury Trial: Appellate Court Upholds Binding Mediation Agreement
The California Constitution (Art. I, § 16) guarantees an “inviolate” right to a “trial by jury”. In a civil case, the right to a jury may be waived by “the consent of the parties expressed as prescribed by statute”. Id. The California legislature has prescribed five different ways in which a jury trial in a civil case may be waived: failing to appear Read more...
Why No “F” Notice May Be Required When Forming A Subsidiary
Corporations form subsidiaries for a variety of purposes. For example, a corporation may form a subsidiary to acquire or hold specific assets or to engage in a merger or other transaction. The sale of shares to the parent is a sale of securities that is subject to qualification under the Corporate Securities Law of 1968. In many cases, counsel may be Read more...
Reasonable Efforts May Be A Promisor’s Best Efforts
Contracts often include clauses requiring the parties to exercise their “best efforts” but don’t say what exactly this means. For example, a merger agreement may require parties to use their best efforts to secure all necessary regulatory approvals. Does a “best efforts” clause require a party to subordinate its interests to the other party or undertake extraordinary efforts to fulfill Read more...
When A Majority Vote Of The Required Quorum Isn’t Sufficient
Corporations Code Section 307(a)(8) sets forth the general voting rule applicable to actions by directors. It provides that the decision made by a majority of directors present at a duly held meeting at which a quorum is present is the act of the Board of Directors. Assume, for example, that a corporation has 7 authorized directors, no vacancies, and a required quorum Read more...
California Court Distinguishes Delaware’s VantagePoint Opinion
Typically, corporate bylaws provide that officers serve at the pleasure of the Board of Directors and any officer may be removed, either with or without cause, by the Board of Directors. This right of removal is consonant with the notion that an officer’s relationship with the corporation is the subject of corporate law. However, another body of law can, and does, intrude. If Read more...
Little Hoover Commission Votes To Approve Governor’s Reorganization Plan
Yesterday morning, the Little Hoover Commission voted to approve the Governor’s Reorganization Plan, subject to the members appointed by the Speaker of the Assembly (Mark Vargas) and the Senate Rules Committee (Jonathan Shapiro) reaching agreement on unspecified language in the Commission’s report. The Plan will take effect unless either house of the legislature adopts by a majority vote a resolution Read more...
Is “Corporation” Spelt “LLC”?
When I first started practicing law, the idea of the limited liability company had yet to be birthed. A decade later, I co-authored an article speculating on whether California would enact a limited liability company law: Are Limited Liability Companies Coming to California? 13 CEB California Business Law Reporter 135 (1991). Five years later, I participated in the drafting of legislation that would Read more...
NASAA And The DOC Warn Investors Of The “Madding Crowd’s Ignoble Strife”
Crowdfunding Caveats Issued To say that the North America Securities Administrators Association was not pleased when Congress enacted the JOBS Act is like saying that Captain George Pollard and his crew had an unpleasant cruise on the Essex. NASAA was especially wounded by Congress’ decision to create a crowdfunding exemption under the Securities Act of 1933 and to preempt state qualification requirements with offerings made pursuant Read more...
Supreme Court Fails To Bite At Bulldog And Oxfam America Sues The SEC
Supreme Court says “no” to Bulldog In March, I wrote that the Bulldog group of funds had asked the United States Supreme Court to determine the constitutionality of Massachusetts’ ban general solicitations in connection with the offer and sale of unregistered securities. Despite representation by Harvard Law School Professor Laurence H. Tribe and an amicus brief from the Cato Institute, Read more...
It May Be The Hobgoblin Of Little Minds, But California Requires It Nonetheless
In yesterday’s post, I mentioned the very recent decision by the U.S. Supreme Court in U.S. v. Home Concrete & Supply, LLC (April 25, 2012). The underlying fight was about a tax deficiency, but the legal question was whether the Internal Revenue Service could adopt a regulation that effectively overruled a prior U.S. Supreme Court decision (Colony, Inc. v. Commissioner, 357 Read more...
