Court Of Appeal Validates Contractual Choice Of Venue
In this November of 2010 post, I considered whether venue selection agreements are valid in California. I noted that the California Supreme Court had held that venue selection provisions are void. General Acceptance Corp. v. Robinson, 207 Cal. 285, 289 (1929). I also noted two more recent decisions by the Courts of Appeal that appear to follow the holding in General Acceptance: Alexander v. Superior Court, Read more...
Supreme Court Holds California’s Survival Statute Inapplicable To Delaware Corporation
Section 278 of the Delaware General Corporation in effect limits suits against dissolved corporations to a period of three years from dissolution. In contrast, Section 2010 of the California Corporations Code sets no time limitation for suing a dissolved corporation. As the Supreme Court explained in Peñasquitos, Inc. v. Superior Court, 53 Cal. 3d 1180, 1190 (1991): Under our statutory Read more...
Brazilian Noteholder Sues Brazilian Guarantor – What Does New York Law Have To Do With It?
At the opening of the Los Angeles aqueduct on November 5, 1913, William Mulholland famously declared “There it is. Take it!” Much the same could be said of Civil Code Section 1646.5. The statute provides that the parties to a contract relating to a transaction involving at least $250,000, including a transaction covered by Commercial Code Section 1301(a), may agree that Read more...
Federal Court Upholds Delaware Forum Selection Notwithstanding California Securities Law Claims
Corporations Code Section 25701 is California’s anti-waiver statute. It provides that “Any condition, stipulation or provision purporting to bind any person acquiring any security to waive compliance with any provision of this law or any rule or order hereunder is void.” What impact, if any, does this have on a forum selection agreement? Three decades ago, the California Court of Read more...
Forum Selection Bylaws And The California Constitution
Last December, I briefly discussed whether a forum selection bylaw with respect to officers and directors would pass muster as a contractual choice of law. See A Forum Selection Clause Issue That You May Not Have Heard About Until Now. It also occurs to me that forum selection bylaws might run afoul of the California Constitution. What does the California Read more...
Is FDIC v. Van Dellen California’s Smith v. Van Gorkom?
Last Friday, the jury in FDIC v. Van Dellen (C.D. Cal. Case No. CV 10-4915 DSF (SHx)) returned a verdict totalling nearly $169 million against three former officers of the home builder division of IndyMac Bank, F.S.B. The Office of Thrift Supervision closed the bank in 2008. As the receiver for the bank, the Federal Deposit Insurance Corporation filed suit against the three former officers. Read more...
A Forum Selection Clause Issue That You May Not Have Heard About Until Now
In a forthcoming paper, Professor Joseph A. Grundfest at Stanford Law School examined the incidence of forum selection provisions by chartering and headquarters jurisdictions. It may come as a surprise to very few that California ranked first: “The largest percentage of publicly traded entities with intra-corporate forum selection provisions, 31.6% of the sample (42 of 133), are headquartered in California, and all of Read more...
Can CalPERS Be Sued In Federal Court Or Perhaps Even New York State Court?
The California Public Employees’ Retirement System began lending securities in the early 1980s. Since the early 1990s, CalPERS has used the Master Securities Loan Agreement (MSLA) originally developed by the former Bond Market Association (fka Public Securities Association and nka Securities Industry and Financial Markets Association). I’m told by CalPERS that it currently uses the 2000 version of the MSLA. This raises Read more...
California’s Hostility To Non-Compete Agreements Does Not Vitiate Forum Selection Clause
In numerous posts, I’ve discussed California’s policy against covenants not to compete as mandated by Business & Professions Code Section 16600. From a different, more positive perspective, California could be characterized as having a strong policy in favor of employee mobility. However Section 16600 may be characterized, it cannot be gainsaid that it’s very tough to get a California court to enforce a Read more...
