Posts by Richard Burt
California Corporations Code Not Applied to Avoid Dissolution of Foreign Entities
When an action is brought to dissolve a California limited partnership or a California limited liability company, the California Corporations Code allows the other partners or the other members to avoid the dissolution by purchasing, for cash, the interests owned by the party seeking dissolution. Corp C § 15908.02(b) is the provision that applies to…
Read MoreCivil Code Sections relating to General Releases Modified
On February 28, 2019, the Corporations Committee of the Business Law Section of the California Lawyers Association published an e-bulletin that I authored. The text of the e-bulletin, as submitted for publication, follows. With SB 1431 (chapter 157, statutes of 2018), the legislature tweaked two Civil Code section relating to releases. The terms “creditor” and…
Read MoreLegislature Expands Shareholder Inspection Rights
The Corporations Committee of the Business Law Section of the California Lawyers Association today published an e-bulletin, which I authored. The text follows: The legislature amended Corporations Code § 1601, which grants shareholders the right to inspect and copy corporate records. The corporations subject to § 1601 are California corporations, foreign corporations having their principal…
Read MoreBad Corporate Practice Leads to Bad Result
I recently had a practice note published in the February 2019 eNews from the Business Law Section of the California Lawyers Association. What follows is the text that was submitted for publication. The Delaware Court of Chancery found that a stockholder consent signed without the stockholder having been provided the exhibits referred to in the consent…
Read MoreDelaware Court Upholds Non-Compete against California Employee
The following is the text of an e-bulletin that I wrote and that was published by the Corporations Committee of the Business Law Section of the California Lawyers Association. Patrick Miles, a California resident, was first hired in 2001 by NuVasive, a Delaware corporation doing business in California. He worked in California throughout his employment…
Read MoreAdministrative Dissolution of Corporations and LLCs Adopted in California
The following is the text of an e-bulletin that I wrote and that was published by the Corporations Committee of the Business Law Section of the California Lawyers Association. On September 22, 2018, Assembly Bill No. 2503 was signed into law (and became Chapter 679). This law creates a new form of dissolution, administrative dissolution,…
Read MoreBuy-Sell Agreements in the Articles of Incorporation
Under the Corporations Code, if there is a suit for involuntary dissolution, or if there is an election to dissolve voluntarily by shareholders representing only 50% of the voting power of the stock, the dissolution of the corporation and the appointment of a receiver can be avoided by purchasing the shares owned by the shareholder…
Read MoreBusiness Law Attorney Richard Burt Helps Draft New Corporate Law
A corporation is typically dissolved when the shareholders holding shares that have 50% or more of the voting power elect to dissolve. When an order for relief has been entered under Chapter 7 of the U.S. Bankruptcy Code, the board of directors can elect to dissolve the corporation. But after a corporation files for bankruptcy,…
Read MoreLLC 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 Office Partners, LLC (February 2, 2017), a California Court of Appeal held that a California…
Read MoreOwnership of Passive LLC Interest in Manager-Managed LLC Not “Doing Business” in California
The following is the text of an e-bulletin that I authored and that was published by the Corporations Committee of the Business Law Section of the State Bar of California. In Swart Enterprises, Inc. v. Franchise Tax Board (Jan. 12, 2017), a California court of appeal held that an out-of-state corporation whose sole connection with…
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