Website Heading

CALIFORNIA CORPORATE & SECURITIES LAW

Corporate Ownership Disclosure Again In The Crosshairs

Nevada Secretary of State Announces Task Force Last month, Nevada Secretary of State Ross Miller announced the formation of a task force to investigate registered Nevada business entities that are suspected of being involved in illegal activities including tax evasion, money laundering, securities violations, and the marketing of shell or shelf companies for fraudulent and/or…

Share on:

Thinking About Joining A Club? You May Want To Consider These Corporations Code Provisions First

In Democracy in America, Alexis de Tocqueville devoted an entire chapter to the propensity of Americans to form associations.  In particular, he observed: The Americans make associations to give entertainments, to found seminaries, to build inns, to construct churches, to diffuse books, to send missionaries to the antipodes; in this manner they found hospitals, prisons, and schools.…

Share on:

Why Section 25100(o) Certification Still Matters (Part 3); Big Whistleblower Award By OSHA

In two earlier posts, I wrote about why the Commissioner’s certification of a national securities exchange pursuant to Corporations Code § 25100(o) still matters.  Today, I discuss yet another reason why certification continues to be relevant.  This time the issue involves dissenters’ rights under the California General Corporation Law. Dissenters’ Rights Chapter 13 of the California Corporations…

Share on:

The Imminent Resurrection Of Rule 14a-8 And The Renewed Significance Of State Corporate Law

The big news at the Securities and Exchange Commission last week was that it would not seek to overturn the D.C. Court of Appeals’ decision vacating Rule 14a-11 (See D.C. Circuit Delivers Harsh Judgment on SEC Rule 14a-11 and Business Roundtable v. SEC – Winners and Losers).   When the SEC adopted Rule 14a-11, it also approved…

Share on:

Options Trading Without The Issuer’s Consent

In yesterday’s post, I discussed secondary trading of standardized options and noted that the SEC has taken the position that in the case of standardized options the issuer is The Options Clearing Corporation.  This leads to the question of whether the issuer of an underlying security has any say in deciding if there will be secondary trading in standardized options to acquire its security. …

Share on:

Nevada Enacts Changes To Business Records and Notice Requirements

Apparently, the State of Nevada takes seriously Judge Gideon J. Tucker’s observation that “no man’s life, liberty, or property are safe while the legislature is in session.” 1 Tucker (N.Y. Surr.) 249 (1866) quoted in Lucas v. Mercantile-Safe Deposit & Trust Co., 29 Md. App. 633, 644 (Md. App. 1975).   You can read more about…

Share on:

Court Decides Buy-Out Claims Are Derivative

When a shareholder sues corporate officers and directors, she must decide whether to bring a direct action (which may be a class action) or a derivative suit.  The consequence of making the wrong decision may be dismissal of the shareholder’s suit as was the case recently in Sweeney v. Harbin Electric, Inc., 2011 U.S. Dist.…

Share on:

A Reason To Reincorporate In Nevada (Or California Or Delaware)?

Why read the papers when you can watch the video? In this month’s issue of California Lawyer magazine, Thomas Brom writes about an unusual opportunity to watch an arbitration proceeding between a Canadian gold mining company, PacRim Cayman LLC, and the Republic of El Salvador.  The proceeding was held at the World Bank’s International Centre for Settlement of…

Share on:

Nevada Supreme Court Pragmatically Rules On Delivery Of Dissenters’ Rights Notices

Last week, the Nevada Supreme Court answered the question of whether notice of dissenters’ rights must be delivered to both stockholders of record and beneficial owners. NRS 92A.410(2) provides that when a merger is effected without stockholder approval under NRS 92A.180, the Nevada corporation “shall notify in writing all stockholders entitled to assert dissenters’ rights…

Share on:

Are Reverse Mergers A Nevada Problem?

Yesterday, the Securities and Exchange Commission issued this bulletin on the risks of investing in reverse merger companies.  In this post from the week before, I wrote about a recent article that found that Nevada is second only to Delaware in attracting out-of-state publicly traded corporations.  The article by Professors Michal Barzuza and David C. Smith looked at the…

Share on: