California Corporate & Securities Law

Five years ago, I noted that Section 107 of the California Corporations Code prohibits any corporation, flexible purpose corporation, association or individual from issuing or putting in circulation, as money, anything but the lawful money of the...

In 2003, The California legislature enacted SB 523 to subject certain corporations to civil penalties of up to $1 million if the corporation has knowledge of certain acts and fails to notify the Attorney General or the "appropriate government...

Section 204(b) permits the articles of incorporation to include reasonable restrictions upon the right to transfer orhypothecateshares of any class or classes or series. This is the only time the word "hypothecate" appears in the General...

Ralph Waldo Emerson famously derided a foolish consistency, famously writing in his essay, Self-Reliance:

Spring is the traditional season for cleaning and California's Corporations Code and securities rules are desperately in need of some tidying up.  In a very quick and incomplete review of the Code and the Commissioner's rules, I found the following:

Delaware and Nevada are each in the business of marketing their corporate laws to businesses in other states. Thus, it should surprise no one that these states don't appreciate it when their legal offerings are undermined by other states. One way to...

In several recent posts, I have noted that officers, unlike directors, are agents of the corporation.  Recognizing the agency status of officers can affect the legal analysis in a number of significant ways, including:

Can a board of directors remove one of its own? In the case of a California corporation, the answer is no. The power to remove directors is vested in the shareholders and the superior court pursuant to Corporations Code Section 303 and 304. While...