Practitioners who deal with multi-member commissions and boards here in California are likely to have heard of this state’s open-meeting law – The Bagley-Keene Open Meeting Act, Government Code Sections 11120-11132. The Act includes a surprisingly libertarian statement of legislative intent:
The people of this state do not yield their sovereignty to the agencies which serve them. The people, in delegating authority, do not give their public servants the right to decide what is good for the people to know and what is not good for them to know. The people insist on remaining informed so that they may retain control over the instruments they have created.
Government Code Section 11120(a). In general, the Bagley-Keene Act requires that the public have “a seat at the table” at any meeting of a state body. A meeting occurs when a quorum of a body convenes, either serially or all together, in one place, to address issues under the body’s jurisdiction. Government Code Section 11122.5. For those dealing with California boards and commissions, the Attorney General has prepared this Guide to the Bagley-Keene Open Meeting Act which it incorrectly titles as the “Bagley-Keene Open Meeting Act of 2004″ (it was enacted way back in 1967).
Meetings of corporate boards are, of course, different.
Corporate board meetings are almost never open to shareholders, much less the public in general. Nothing in either the California Corporations Code or the Nevada private corporation law grants shareholders the right to attend meetings. Shareholders moreover do not have an absolute right to inspect minutes of board meetings. California requires that the shareholder have a purpose reasonably related to such holder’s interests as a shareholder. Cal. Corp. Code § 1601(a). Nevada doesn’t even grant shareholders an express right to inspect the corporate records, although it does authorize inspection of the stock ledger (NRS 78.105) and financial records (NRS 78.257). See Chapter 6 of my book, Bishop & Zucker on Nevada Corporations and Limited Liability Companies.
Corporate lawyers are also less likely to count informal or serial meetings of directors as meetings even though these would likely count as meetings under the Bagley-Keene Act. For public companies, an accurate meeting count is necessary because they are required to disclose the number of meetings of the board of directors (including regularly scheduled and special meetings) that were held during the last full fiscal year and to name each incumbent director who during the last full fiscal year attended fewer than 75 percent of the aggregate of: (i) The total number of meetings of the board of directors (held during the period for which he has been a director); and (ii) The total number of meetings held by all committees of the board on which he served (during the periods that he served). Item 407(b)(1) of Regulation S-K.
