Shareholder Loses Standing to Maintain Derivative Action After Merger

Posted on September 6, 2012 by Richard Burt

In Villari v. Mozilo (2012) 208 Cal. App. 4th 1470, the court held that under Delaware law a shareholder who was a plaintiff in a shareholder derivative action lost standing to maintain that action once a merger resulted in the … Continue reading →

Posted in Directors and officers, Mergers and Acquisitions, Minority Shareholders | Comments Off on Shareholder Loses Standing to Maintain Derivative Action After Merger

Removal of Officer of Delaware Corporation May Be Partly Governed by California Law

Posted on June 5, 2012 by Richard Burt

In Lidow v. International Rectifier Corp. (2012) 206 Cal. App. 4th 351, the court held that, notwithstanding the conflict of laws principle known as the internal affairs doctrine, where a foreign corporation is alleged to have removed or constructively discharged … Continue reading →

Posted in Corporate Law, Directors and officers, Entity Law | Tagged | Comments Off on Removal of Officer of Delaware Corporation May Be Partly Governed by California Law

No “Selective Waiver” of Attorney-Client Privilege

Posted on May 9, 2012 by Richard Burt

To show that they are good citizens, public companies are often encouraged by the government to investigate wrong-doing by their employees and then to take corrective action. Often these internal investigations are conducted by outside legal counsel, who prepare a … Continue reading →

Posted in Attorney-Client Matters, Corporate Law, Directors and officers | Tagged | Comments Off on No “Selective Waiver” of Attorney-Client Privilege

Court Holds Business Judgment Rule Does Not Protect Officer’s Decisions

Posted on January 18, 2012 by Richard Burt

The business judgment rule insulates directors from liability from bad decisions if certain conditions are met. A recent U.S. District Court opinion holds that the business judgment rule does not apply to corporate officers. Federal Deposit Insurance Corp. v. Perry … Continue reading →

Posted in Corporate Law, Directors and officers | Tagged | Comments Off on Court Holds Business Judgment Rule Does Not Protect Officer’s Decisions

Licensed Clinical Counselors Allowed to Form Professional Corporations

Posted on November 9, 2011 by Richard Burt

Under the Moscone-Knox Professional Corporation Act, lawyers, physicians, and others engaged in occupations specified by the act may organize their practices as professional corporations. By reason of Chapter 381 of the Statutes of 2011, the Moscone-Knox Professional Corporation Act has … Continue reading →

Posted in Directors and officers, Entity Law, Professional Corporations | Comments Off on Licensed Clinical Counselors Allowed to Form Professional Corporations

Corporations and LLC’s May Elect to Receive Notices From the Secretary of State via E-Mail

Posted on November 1, 2011 by Richard Burt

Existing law requires corporations and limited liability companies to file with the Secretary of State annual statements of information with specified information. To aid these entities in filing timely, the Secretary of State mails a notice to them three months … Continue reading →

Posted in Corporate Law, Directors and officers, Limited liability companies (LLC) | Tagged , , | Comments Off on Corporations and LLC’s May Elect to Receive Notices From the Secretary of State via E-Mail

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

Posted on October 15, 2011 by Richard Burt

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 →

Posted in Contract Drafting, Corporate Law, Directors and officers | Tagged , , | Comments Off on Labor Code section 2802 Does Not Apply to Employer’s Unsuccessful Suit Against Employee

California rejects “zone of insolvency” theory of director liability

Posted on November 5, 2009 by Richard Burt

The general rule is that directors of a corporation owe no duty to creditors because it is the shareholders who own a corporation. From an economic perspective, when a corporation is solvent, it is the shareholders who are the residual … Continue reading →

Posted in Directors and officers, Entity Law | Tagged , | Comments Off on California rejects “zone of insolvency” theory of director liability

Whom Does an Attorney Represent When a Number of Parties Are Involved?

Posted on March 17, 2009 by Richard Burt

The case of Chang v. Lederman (2009) 172 Cal. App. 4th 67, while dealing with the obligations of an estate planning lawyer to beneficiaries of the estate, may be of interest to participants in business transactions or business enterprises. Facts … Continue reading →

Posted in Attorney-Client Matters, Directors and officers, Entity Law | Comments Off on Whom Does an Attorney Represent When a Number of Parties Are Involved?

Inspection Rights of Directors and Shareholders

Posted on January 7, 2009 by Richard Burt

Corporations Code section 1602 provides that: “Every director shall have the absolute right at any reasonable time to inspect and copy all books, records and documents of every kind … of the corporation of which such person is a director….” … Continue reading →

Posted in Attorney-Client Matters, Directors and officers, Entity Law | Comments Off on Inspection Rights of Directors and Shareholders