LLC Bound by Contract Even Though Contract Was Outside Its Purpose and Signatory Was Technically Not a Manager

The following is the text of an e-bulletin that I authored on apparent authority and that was published by the Corporations Committee of the Business Law Section of the State Bar of California. In  Western Surety Co. v. La Cumbre … Continue reading

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Webinar Presentation on Drafting Buy-Sell Agreements

On November 14, 2104, I conducted a webinar on “Drafting Buy-Sell Agreements–What  the Forms Books Won’t Tell You.” The program was jointly sponsored by the Corporations Committee and the Partnerships and LLC Committee of the Business Law Section of the … Continue reading

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Excluding Assets From a Personal Guaranty

The following is the text of an e-bulletin that I prepared that was published by the Corporations Committee of the Business Law Section of the State Bar of California. This was republished (under the title of “Excluding Assets from a … Continue reading

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Superfluous Text in a Contract Opens Door to Litigation

The recent case of Schron v. Troutman Saunders LLP, from the New York Court of Appeals, New York’s highest court, shows the importance of not including unnecessary verbiage in a contract just because it’s traditional. In this case, an LLC … Continue reading

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Bylaw Indemnification and the Statute of Frauds

In a recent post on his blog, Keith Bishop asks the question, Are charter indemnification provisions contracts? Many companies include provisions in their articles and bylaws that mandate indemnification of directors and officers, and they often say that they are … Continue reading

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California Supreme Court Overrules Prendergrass

In Riverisland Cold Storage, Inc. v. Fresno-Madera Production Credit Association (January 14, 2013), the California Supreme Court overruled a precedent of over 75 years’ standing (Bank of America etc. Assn. v. Pendergrass (1935) 4 Cal.2d 258) and held that a … Continue reading

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Inconsistent Use of Entity Name Proves Costly

In Montgomery Sansome v. Rezai (March 28, 2012) 204 Cal. App. 4th 786, the court held that a construction contractor’s designation of an entity as a “general partnership” in a fictitious business name statement when the contractor was licensed as … Continue reading

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Springing Covenant Not to Compete Not Enforceable

In Fillpoint, LLC v. Maas (2012), a court struck down a covenant not to compete that would take effect only upon termination of employment where the covenant was in addition to a covenant not to compete that was given in … Continue reading

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Labor Code section 2802 Does Not Apply to Employer’s Unsuccessful Suit Against Employee

In Nicholas Laboratories, LLC  v. Chen (October 12, 2011) 11 C.D.O.S. 12769, the court decided that an employer was not obligated to indemnify its employee for expenses the employee incurred in successfully defending himself against employer’s lawsuit for breach of … Continue reading

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Zalkind v. Ceradyne, Inc.

In Zalkind v. Ceradyne, Inc. (2011) 194 Cal. App. 4th 1010, Ceradyne, Inc. (Ceradyne), entered into an asset purchase agreement (asset purchase agreement) with Stanley and Elizabeth Zalkind (the Zalkinds) and Quest Technology, LP (Quest), a limited partnership owned by … Continue reading

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