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CALIFORNIA CORPORATE & SECURITIES LAW

Can The Secretary Of State Reject Disparaging Business Entity Names?

Section 2(a) of the Lanham Act bars the Patent and Trademark Office from registering scandalous, immoral, or disparaging marks. 15 U.S.C. § 1052(a).  However, the United States Court of Appeals for the Federal Circuit sitting en banc recently held that the disparagement provision in Section 2(a) is unconstitutional because it violates the First Amendment to the U.S. Constitution.  In…

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Will You Be Gulled By This Notice?

Some Nevada corporations have been receiving the above notice and paying a $150 fee to the Division of Corporate Services.  According to the Nevada Secretary of State: This is not an official notice from the Secretary of State’s office.  Nevada entities are not required to regularly provide to the Secretary of State shareholder information or…

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Nevada To Allow Corporations To Stiff Charon

Unsuccessful corporations often fall into an eternal desuetude.  Having nothing, no one wants to pay the Secretary of State to complete their dissolution.  Because they don’t file the required annual lists and pay the annual fees, their charters are revoked.   They then become like those poor souls with no coin for Charon, they cannot complete the journey to complete…

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June 30 Deadline Looms For Foreign Lending Institutions

California Corporations Code Section 191(d) provides that a “foreign lending institution” will not be considered to be “doing, transacting or engaging in business” in California solely by reason of engaging in specified categories of activities.  Those activities include, for example, the ownership of loans and the enforcement of loans.  Based on this statute, some foreign lending…

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Chairman, Chairwoman, or Chair?

To someone who is not familiar with the English language, many words must seem bizarre.  One such word, is “chairman”.  Does this refer to a chair made into a man or a man made from a chair?  What should be made of a law that solemnly proclaims “All references in this division to ‘chairman’ shall be…

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Victims Of Corporate Fraud Compensation Fund

In the waning days of the 2001-2002 legislative session, then Assemblymember Kevin Shelley gutted and amended AB 55. As introduced, AB 55 would have amended the Elections Code. Instead, AB 55 became the vehicle for the enactment of the deeply flawed California Corporate Disclosure Act, Cal. Corp. Code § 1502.5.   AB 55 also created The…

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Some LLC Names Slip Past California’s Statutory Ban

The California Revised Uniform Limited Liability Company Act explicitly bans a number of different words from being included in LLC names: The name shall not include the words “bank,” “trust,” “trustee,” “incorporated,” “inc.,” “corporation,” or “corp.” and shall not include the words “insurer” or “insurance company” or any other words suggesting that it is in…

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Governor Signs Bill Narrowing Grounds For Business Entity Reinstatement

Over the years, I’ve received several calls asking what can be done when a business entity has been wrongfully terminated.  Answering this question became a bit easier in 2006 with the enactment of AB 2588 (Runner) which authorized a court to reinstate a business entity for any of the following three reasons: The factual representations…

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Are Proper Names In A Language?

My last name is Bishop.  In Spanish, it would be Obispo.  If I included Obispo in a corporate name, would that be acceptable to the Secretary of State? Nevada has a statute, NRS 78.028 that provides “No record which is written in a language other than English may be filed or  submitted for filing in the…

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Secretary Of State Changes Forms And Procedures For LLC Filings

Novelty does not mean better.  With the change from 2013 to 2014, California repealed, albeit unconstitutionally, the Beverly-Killea Limited Liability Company Act (former California Corporations Code sections 17000 – 17657), and installed in its place the California Revised Uniform Limited Liability Company Act” (California Corporations Code sections 17701.01 – 17713.13).  See California’s New LLC Act – Call…

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