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CALIFORNIA CORPORATE & SECURITIES LAW

Of Touting, Tweets and Advertising

Last month, the Securities and Exchange Commission issued this public statement warning about touting of securities by celebrities: Celebrities and others are using social media networks to encourage the public to purchase stocks and other investments.  These endorsements may be unlawful if they do not disclose the nature, source, and amount of any compensation paid, directly…

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Federal Court Says City Is Immune From State Securities Law Claims

It’s a good situation when you can make the rules for everyone else but immunize yourself from those same rules. California’s Corporate Securities Law of 1968 declares it unlawful for any “person” to offer or sell a security by means of any written or oral communication that includes an untrue statement of material fact or…

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Section 25501.5 – “A Riddle, Wrapped In A Mystery, Inside An Enigma”

Last December, I wrote this post about Corporations Code § 25501.5 that asked “What do it mean?”.  In general, the statute authorizes an action for rescission (or damages, if the security is no longer owned) by any person “who purchases a security from or sells a security to a broker-dealer that is required to be licensed and has not”.  However, the statute makes little…

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Video: Fairness Hearings: A Faster, Cheaper Alternative To Federal Registration

Watch the video A California fairness hearing can be a faster, cheaper alternative to federal registration under the Securities Act of 1933.  Although fairness hearings can be used in a variety of situations, they are most often used by publicly traded companies using their own securities to acquire another company.  According to the Department of Corporations, the approximate…

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