California Lawyers Association

Business Law Corporations Committee

Updates from the Business Law Corporations Committee

The Corporations Committee and the Nonprofit Organizations Committee of the Business Law Section of the California Lawyers Association are pleased to announce that, on October 5, 2021, Governor Newsom signed their sponsored corporations and nonprofits governance bill, AB 663 (Assemblymember Chen). Read more
On September 8, 2021, the SEC charged a Nevada lawyer for playing a crucial role in facilitating the sale of millions of shares of unregistered stock in violation of the federal securities laws. Read more
On August 17, 2021, the California Court of Appeal, Fourth Appellate District, in Turner v. Victoria, held that a director of a California nonprofit public benefit corporation who brought an action on behalf of the corporation lost standing to pursue her claims when she lost re-election to the board. Read more
On July 2, 2021, a three-judge panel of the California Court of Appeal, First Appellate District, Division Three, in Ramirez v. Gilead Sciences, Inc., affirmed the trial court’s denial of plaintiff’s petition for writ of mandate to compel Gilead Sciences, Inc., a Delaware corporation headquartered in California, to allow the plaintiff to inspect certain of its books and records under California statutory and common law. Read more
On June 21, 2021, a three-judge panel of the Ninth Circuit Court of Appeal, in Creighton Meland v. Shirley N. Weber, Secretary of State of California (No. 20-15762), reversed the district court’s dismissal for lack of standing of a lawsuit brought by a shareholder challenging the constitutionality of California’s gender quota law found in Section 301.3 of the California Corporations Code. Read more
In early 2021, the California Senate introduced two bills related to reporting of greenhouse gas emissions (SB 260) and climate-related financial risk (SB 449). Both bills were amended as recently as April 2021. Read more
On February 4, 2021, the Federal Trade Commission announced a suspension of grants of early termination of the 30-day HSR waiting period, for all transactions, during a ‘review period’ as the FTC and the DOJ assess the policies and procedures used to grant early termination. Read more
On January 28, 2021, the Delaware Court of Chancery, in the case of Swipe Acquisition Corporation v. Peter M. Krauss, 2021 Del Ch. Lexis 14, held that a Delaware choice of law provision in a stock purchase agreement must yield to the State of California’s strong public policy that violations of its corporate securities laws are not waivable. Read more
The California Secretary of State has announced that it will resume certain services effective June 1, 2020. Read more
Corporate practitioners are confronting many legal issues arising from the COVID-19 coronavirus pandemic. It is worth remembering that the California Corporations Code (“Code”) provides some flexibility in corporate governance during a state of emergency. As a result of legislation that was spearheaded by the Corporations Committee, effective January 1, 2014 the Corporations Code was amended in three important ways. First, section 212 (c)(1) was added to the Code to specifically acknowledge that bylaws may contain any provision, not in conflict with the articles of incorporation, to manage and conduct the ordinary business affairs of a corporation during an “emergency,” including but not limited to procedures for calling, and quorum requirements for, board meetings and designation of additional or substitute directors. Read more

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