Court Rejects Use Of Alter Ego Doctrine To “Borrow” Contractor License

California’s Contractors’ State License Law, Business & Professions Code Section 7000 et seq., requires contractors to be licensed unless they are exempt from licensure.  Those who perform contracting work without a license run a very real risk of working for free.  Section 7031(b) provides, with one exception, that a person who uses an unlicensed contractor may bring

California’s Hostility To Non-Compete Agreements Does Not Vitiate Forum Selection Clause

In numerous posts, I’ve discussed California’s policy against covenants not to compete as mandated by Business & Professions Code Section 16600.  From a different, more positive perspective, California could be characterized as having a strong policy in favor of employee mobility.  However Section 16600 may be characterized, it cannot be gainsaid that it’s very tough to get

California’s Greenhouse Gas Allowance Auction To Be Held Tomorrow

The California Air Resources Board has given notice of the first greenhouse gas allowance auction to be held tomorrow (November 14).   Last April, I wrote about the market in “Trading In California’s Greenhouse Gas Allowances – Fraud’s New Frontier?” The auction will be effected on an internet-based platform and will have a single-round, sealed-bid format.  The auction is

A Look At Recent DOC Enforcement Activity

Enforcement Actions

The California Department of Corporations administers and enforces numerous state laws, including the Commodity Law, Corporate Securities Law of 1968, Deferred Deposit Law, Escrow Law, Franchise Law, Finance Lenders Law, and Residential Mortgage Lending Act. Recently, I took a look at the Department’s enforcement activity for the first seven months of this year.  By my

Should The Articles Of Incorporation Define “Officers”?

Today’s post is devoted to what may seem an unlikely question: should the articles of incorporation define “officers”?  This is an unlikely question because it is the bylaws that typically identify the titles of officers and their duties.  Cal. Corp. Code § 312(a).  Nevertheless, it occurs to me that in at least one circumstance, a

CalPERS Agrees That It Will Not Enforce Conflict Of Interest Policy

As discussed in this post, I had petitioned the Office of Administrative Law for a determination that the Statement of Investment Policy for External Investment Resource Conflict of Interest adopted by the California Public Employees’ Retirement System constituted an illegal “underground” regulation. The OAL accepted my petition and established a schedule for CalPERS and interested

How To Interpret An Indemnity Agreement

When interpreting an indemnity provision, whether in the articles of incorporation, bylaws or a separate agreement, the first question might be what does “indemnity” mean?  Etymologically, “indemnity” is derived from the Latin words in (not) and damnum (injury or damage).  Section 2772 of the California Civil Code defines “indemnity” as “a contract by which one

Should Your Articles Of Incorporation Include A Choice of Law Provision?

In yesterday’s post, I considered the fundamental question of why indemnification provisions are included in articles of incorporation.  State general corporation laws typically contain express provisions empowering or authorizing corporations to indemnify other persons, including directors, officers and agents.  For example, California has its Section 317, Delaware has Section 145 and Nevada has NRS 78.7502.  When an indemnity provision is

Some Observations On Indemnification Provisions In Articles Of Incorporation

Over the years, I’ve read many articles of incorporation that include provisions relating to indemnification of officers, directors and others.  Today’s post will cover a few questions and observations that have occurred to me over the years.  I’ll cover more of these “Why is there air?” type questions in future posts. Vice Admiral James Stockdale

Federal Court Finds There Can Be No Control Person Liability Without Primary Violator Privity

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Yesterday, I covered Judge Lewis A. Kaplan’s holding in In re Lehman Bros. Securities & Erisa Litigation, 2012 U.S. Dist. LEXIS 148177 (Oct. 15, 2012) that there is no liability under Corporations Code Section 25400 when the plaintiff and defendant dealt in different securities.  Judge Kaplan also considered the parameters of liability under Corporations Code Section 25504.  That statute imposes liability on,