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CALIFORNIA CORPORATE & SECURITIES LAW

Supreme Court Set To Decide Arian Controversy In Janus

The U.S. Supreme Court has scheduled oral arguments in Janus Capital Group, Inc.v. First Derivative Traders for December 7, 2010.  The case concerns whether: (1) a service provider can be held primarily liable for participating in an issuer’s misstatements; and (2) whether a service provide can be held primarily liable for statements not directly and…

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Proxy Access and Majority Voting

According to TheCorporateCounsel.net yesterday, the Security and Exchange Commission’s proxy access rules were published yesterday in the Federal Register – thereby starting the clock on the effectiveness of the rules. In complying with proxy access, California companies should think about the interplay between Corporations Code § 708.5  and proxy access.   Section 708.5 was added to the Code a few…

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LLC Contractor Bill Is Held At Desk

On September 3, 2010, I wrote that SB 392 (Florez) had made it to enrollment.  This bill authorizes the State Contractors’ License Board to issue a contractor’s license to a limited liability company.  Normally, a bill is sent to the Governor after enrollment.  Cal. Const. Art. IV, § 10(a) (“Each bill passed by the Legislature shall…

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Attorney General Suffers Setback in Placement Agent Suit

Yesterday, Bankruptcy Court Judge John Peterson issued his written decision regarding whether the State of California should be granted relief from the bankruptcy automatic stay in order to pursue a civil enforcement action against Alfred R. Villalobos and his affiliated companies.  Mr. Villalobos is a former member of the Board of Administration of the California Public…

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Offers and Sales to Governmental Agencies

David Freeman of Arnold & Porter LLP recently submitted this letter to the Securities and Exchange Commission on behalf of the State of Alaska.  The letter urges the SEC to amend its definitions of “accredited investor” in Rule 215 and Regulation D and “qualified institutional buyer” in Rule 144A to include governmental bodies – pointing…

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CalPERS Considers Placement Agent Regulations Today

CalPERS has been working on its placement agent disclosure regulations for several months now.  Today, CalPERS’ Investment Committee will consider approving revisions to the proposed regulations.  If approved, the final rulemaking package will be submitted to the Office of Administrative Law.  That office will review the regulations for compliance with the Administrative Procedure Act.  If…

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The Dodd-Frank Act’s Impact on California’s Restrictions on Investment Adviser Performance Compensation

Prior to the enactment of the Dodd-Frank Act, Section 205 of the Investment Advisers Act of 1940 prohibited the receipt of performance compensation by an investment adviser unless the adviser was exempt from registration under Section 203(b) of the Advisers Act.  Performance compensation is compensation based on the capital gains or capital appreciation in a client’s account.  Performance compensation has been a…

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A Win for Queequeg: The Ninth Circuit Holds that Tattooing is Constitutionally Protected

Occasionally, I can’t resist the temptation to digress into other legal areas.  Today’s opinion by the Ninth Circuit Court of Appeals in Anderson v. City of Hermosa Beach  (Case No. 08-56914, Sept. 9, 2010) is one of these irresistable tempations.  That case involved a challenge to a city’s ban on tattoo parlors.  No, the city didn’t ban tattoos, just…

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Will the “Real” Directors Please Take Your Seats?

As discussed in this earlier post, the Securities and Exchange Commission’s new proxy access requirements will likely bring attention to director qualification requirements.   The California General Corporation Law does not require that a person satisfy any particular qualification requirements to hold office as a director.  The bylaws may, however, impose qualification requirements.  Cal. Corp. Code § 212(b)(4).   These qualifications…

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Want to Nominate a Director Today? Here’s How

The Securities and Exchange Commission’s new proxy access requirements are garnering a great deal of attention even though those rules have yet to take effect.  In the meantime, you can still nominate a candidate for election as a director by sending an email to: DiverseDirectorDatabase@calpers.ca.gov. No, this won’t necessarily get your candidate in any company’s…

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