Rule 260.204.9 – “What is to be Done?”
As I mentioned in this earlier post, California has its own definition of “venture capital company” in Rule 260.204.9. This rule is an exemption from the investment adviser registration requirement in Corporations Code Section 25230 if a person meets the following conditions: Does not hold itself out generally to the public as an investment adviser; Has fewer than 15 clients; Is exempt from Read more...
New DOC Chief Deputy Commissioner
When I was Commissioner of Corporations, I was sometimes asked about the other commissioners. However, the Department of Corporations is headed by a Commissioner – not a commission. Thus, there is only one Commissioner at a time. The Commissioner is appointed by the Governor and confirmed by the state Senate. Government Code Section 1322(5). Thus, the Commissioner is a political Read more...
Form D or 25102(f) Notice?
Issuers relying on Rule 506 of Regulation D under the Securities Act of 1933 have the benefit of federal preemption of California’s (and other states’) qualification requirement by virtue of Section 18(b)(4)(D) of that act. Although no state law change was required to effect this preemption, the California legislature acknowledged reality by enacting Section 25102.1 of the California Corporations Code. That statute Read more...
Just Released: Marsh & Volk Updates
The publisher has now released the 2010 update to Marsh & Volk, Practice under the California Securities Laws. Therefore, be sure that you check to see that you have an updated copy. A couple of years ago, I joined Roy Finkle as a practice consultant to this work. Roy was a friend and protege of the late Harold Marsh. Professor Marsh is a legend among corporate and Read more...
Can California Handle Dodd-Frank?
In 1996, Congress apportioned regulation of investment advisers between the Securities and Exchange Commission and the states based on the amount of assets that an adviser had under management. At that time, Congress drew the line at $25 million in Section 203A of the Investment Advisers Act of 1940 (subsequent rulemaking by the SEC generally did not require SEC registration until the adviser had assets under management Read more...
Furlough Fridays Once More
The State of California still has no budget and Governor Schwarzenegger has been stymied for the time being in reducing state workers to the federal minimum wage. As reported by Shane Goldmacher in this Los Angeles Times story, Governor Schwarzenegger has issued another executive order requiring most California state workers to take the second, third and fourth Fridays off each Read more...
What is a Venture Capital Fund?
Section 407 of the Dodd-Frank Wall Street Reform and Consumer Protection Act creates a new exemption from federal registration for investment advisers if all their investment advice is limited to one or more “venture capital funds”. Congress, however, did not say what a “venture capital fund” was. Rather, Congress told the Securities and Exchange Commission to define the term and Read more...
Life Settlement Contracts Are Securities in CA
Broc Romanek also mentions in his blog today that the Securities and Exchange Commission issued a task force report on life settlement contracts. Among other things, the task force recommends that Congress amend the definition of “security” under the federal securities laws to include life settlements. The task force defines a “life settlement” as “a transaction in which an insurance Read more...
People v. Cole – “So What Happens Now?”
Yesterday was the last day for comments on the Commissioner’s proposed rule to address the Court of Appeal’s holding in People v. Cole, 156 Cal. App. 4th 452 (2007). I’ve seen that several persons have submitted comments in addition to myself – all addressing the exception for employees in the proposed rule. To reprise Evita Peron, so what happens now? Read more...
DOC Employees to Receive Full Pay – For the Time Being
On July 6, 2010, I reported on a recent Court of Appeal decision that supported Governor Schwarzenegger’s attempt to reduce state employees’ salaries to the federal minimum wage. The Court of Appeal’s holding did not require the Controller to reduce salaries. Thus, the Governor went back to Superior Court. As reported in this Sacramento Bee article, Judge Patrick Marlette sided Read more...
