Where Exactly Is It Written That Shareholders Aren’t Liable For Corporate Debts?

Recently, UCLA Law School Professor Stephen Bainbridge took notice of Section 6.22(b) of the Model Business Corporation Act and asked what might lead a corporation to waive the limited liability of shareholders in its articles of incorporation.  That section provides “Unless otherwise provided in the articles of incorporation, a shareholder of a corporation is not

California State Employee To Be Paid More Than $800,000

It’s Good Work, If You Can Get It According to this story by Michael D. Morois, the California Public Employees’ Retirement System recently doubled bonuses to its staff, paying an aggregate of $7.7 million to some 130 employees. That averages out to just under $60,000 per employee. Of course averages can be misleading.  CalPERS’ Chief

Employer’s Lawyer Who Defended Employee At Deposition May Be Liable To The Employee For Malpractice

Corporations may have free speech rights (Citizens United v. FEC, 558 U.S. 310 (U.S. 2010)) but they can’t talk.  Thus, any deposition testimony must come from the mouths of people who are the agents, employees and directors of the corporation.  These people usually come to the deposition with lawyers.  But whom do these lawyers represent

CalPERS Files Amicus Brief In Titanomachy With San Bernardino

Hesiod’s Theogony tells the story of the birth of the Greek gods.  The first gods were not the Olympians, but the Titans (who were in turn the children of Heaven (Oὐρανόσ) and Earth (Γαῖα)).  Cronos, the leader of the Titans, feared that his children would displace and in a shocking case of theophagy swallowed his children

Tender Of Inflated Price Under Right Of First Refusal Does, And Doesn’t, Confer Standing

In a short ruling, U.S. District Court Judge Jeffrey S. White recently tackled a claim by a former employer that its departed employee had committed securities fraud when he allegedly failed to disclose that the price offered by his new employer for his shares of the former employer were “inflated and fraudulent”.  The price mattered to

How To Get A Request For An Interpretive Opinion Rejected

Corporations Code Section 25618 authorizes the Commissioner of Business Oversight to honor requests for interpretive opinions.  An interpretive opinion offers far more protection than a no-action letter from the SEC staff.  Section 25700 provides immunity from liability for “any act done or omitted to be done in good faith in conformity with any . . .

In Honor Of Nevada Day – A Transaction You Can Do In Nevada, But Not Delaware

Unlike the monks of Mt. Athos, I don’t adhere to the Julian Calendar (today is October 17, 2013).  However, I do remain a traditionalist when it comes to Nevada Day.  October 31 is the original date on which Nevada Day was celebrated.  In 1999, however, the Nevada legislature made the unfortunate and ahistoric decision to

M&A Brokers – What About George Babbitt?

Yesterday’s post mentioned a California broker-dealer exemption for mergers and acquisitions specialists – Rule 260.204.5.  One astute and observant reader pointed out that California’s Real Estate Law may also be an issue.  This is an issue that I raised three years ago: That law defines a “real estate broker” as any person who sells or offers to sell, buys or

NASAA Supports Regulatory Relief For M&A Brokers

Last June, Congressman Bill Huizenga introduced H.R. 2274 which would amend the Securities Exchange Act of 1934 to provide for a notice-filing registration procedure for brokers performing services in connection with the transfer of ownership of smaller privately held companies.  In most cases, registration would be effective upon filing.  Given NASAA’s generally jaundiced view of

The California Corporations Code – Where The Dead Live On

While in college, I had the unique pleasure of taking a course in Economic Botany and later doing independent study (my paper was on Pinus Monophylla) under the late Dr. Richard Evans Schultes, the father of Ethnobotany.  If Economic Botany sounds dull, in what other class can you learn such practical skills as how to blow poison