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CALIFORNIA CORPORATE & SECURITIES LAW

Plaintiffs Find California Courts Congenial To Section 11 Actions

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 εὕρηκα which is first person, singular, indicative active form of verb “find”.  Thus, it translates into “I have found it”.  The motto, which appears on the state’s seal, was adopted by the Constitutional Convention in Monterrey in 1849.  See Cal. Gov’t Code § 400 (depicting the Great Seal of the State of California).  Does anyone see a conflict between this official use of Greek and the California Constitution?  Cal. Const. Art. III, § 6(b) (“English is the official language of the State of California.”)

Interestingly, California is the only state with a Greek (albeit transliterated) motto.  A plurality of states prefer to do their muttering in Latin (by my count, 23).  Many of the other states have English mottoes, but a few states have elected to use other foreign languages.  For example, Hawaii adopted Hawaiian (“Ua Mau Ke Ea O Ka Aina I Ka Pono” (The life of the land is perpetuated in righteousness)), Maryland, Italian (“Fatti Maschii Parole Femine” (Strong Deeds, Gentle Words)); Minnesota, French (“L’Etoile du Nord” (the Star of the North)); and Washington, Chinook language (“Al-Ki” (By and By)).  Surprisingly, only one state, Montana, has a Spanish language motto (“Oro y Plata” (Gold and Silver)).

Plaintiffs’ Lawyers Have Found California

I have written about the California Court of Appeal’s holding in Luther v. Countrywide Financial Corp., 195 Cal. App. 4th 789 (2011) that state courts retain concurrent jurisdiction over Securities Act class actions involving non-nationally traded securities.  Apparently, this holding (as well as rulings by the U.S. District Courts in California) have opened the proverbial “floodgates of litigation”.   In a guest blog for D&O Diary, Woodruff-Sawyer & Co. reports that there were “22 Section 11 [of the Securities Act of 1933] cases against IPO companies active in various California state courts”.  Because other circuits have taken a different view, the Supreme Court may one day have to resolve the issue.

Great Seal

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