Website Heading

CALIFORNIA CORPORATE & SECURITIES LAW

California Considers Following New England Colonists In Outlawing Fake News

In February, California Assemblyman Ed Chau introduced a bill (AB 1104) that according to its author “attacks the problem of ‘fake news’ by creating a new state law designed to make it illegal for someone to make false or deceptive statements about a candidate or measure on the ballot”.  Specifically, the bill would amend the…

Share on:

What Do You Know? Bill Proposes To Eliminate Scienter

Corporations Code Section 25401 is California’s basic securities antifraud statute: It is unlawful for any person to offer or sell a security in this state, or to buy or offer to buy a security in this state, by means of any written or oral communication that includes an untrue statement of a material fact or…

Share on:

When Partnership “Members” Are Employees

Last week, I wrote about how AB 2883 changes the definition of “employee” vis-a-vis corporate directors.  See Is A Corporate Director An Employee Subject To Workers’ Compensation?  AB 2883 also rewrites the definition of “employee” for purposes of partnerships and limited liability companies.  Effective January 1, 2017, an “employee” for purposes of California’s workers’ compensation law…

Share on:

Congress Voids Form Contract Provisions That Impede Consumer Reviews

To paraphrase William Somerset Maugham’s Of Human Bondage, businesses may ask you for a review, but they only want praise.  Indeed some businesses have tried to ensure only good reviews by including non-disparagement clauses in their consumer contracts. Two years ago, I wrote about a new California law intended to protect reviews of consumer products…

Share on:

There’s Still Time For Congress To Void The SEC’s Resource Extraction Rule

Last June, the Securities and Exchange Commission belatedly adopted a rule requiring disclosure of resource extraction payments by issuers.  As I wrote at the time: Congress had ordered the SEC to adopt a rule by April 17, 2011.  After belatedly adopting a rule, the U.S. District Court vacated the rule and sent it back to the SEC.  American…

Share on:

Happy New Biennium!

“Biennial” is a confusing word.  The Nevada legislature meets biennially, i.e., every other year while the California legislative session is biennial, i.e., lasting two years. “Biennial” should not be confused with “biannual” which normally means twice a year. The California legislature meets annually but the legislative session is biennial.  Last Monday, for example, the California legislature convened for the…

Share on:

All Power To The People: Initiatives And Referenda In California

A year ago, I addressed the effective date of California legislative bills in this post.  In California, the people can also exercise legislative power through two different mechanisms – the initiative and the referendum.  In fact, the California Constitution proclaims: All political power is inherent in the people.  Government is instituted for their protection, security,…

Share on:

California Voters Reject 11th Hour Gutting And Amending Of Bills

Not quite a year ago, I wrote: A reader of the California Constitution would be lead to believe that the course of legislation is orderly and predictable.  Under Article IV, Section 8(b), the legislature may make no law except by statute and no statute except by bill.  Every bill, moreover, must have a single subject…

Share on:

Rescission And The California Corporations Code

Yesterday, I wrote about an attempt, albeit unsuccessful, to avoid a forum selection clause by a claim of rescission.  The plaintiffs’ in that case, Hatteras Enterprises, Inc. v. Forsythe Cosmetic Group, Ltd., 2016 U.S. Dist. LEXIS 100352 (July 30, 2016), invoked California Civil Code Section 1691, which specifies how a party may rescind.  The grounds for…

Share on: