Yesterday’s post concerned California’s statutory scheme governing the gubernatorial power to fill vacant United States Senate seats. The relevant statute requires that the person appointed be an “elector of this state”. Cal. Elect. Code § 10720. The definition of “elector”
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Does California Require "Reasonable Care" In A Board's Selection Of An Expert?
Professor Stephen Bainbridge recently tackled the question of whether the business judgment rule applies to a corporate board’s selection of an expert. Section 141(e) of the Delaware General Corporation Law fully protects a director “in relying in good faith upon…
Has The SEC Put The Proverbial Horse Before The Cart?
In a recently settled administrative proceeding, the Securities and Exchange Commission took the position that an employer took action to impede potential whistleblowers when as a condition of receiving separation pay, the employer required its employees to sign a…
Common Law And The California Revised Uniform Limited Liability Company Act
Section 17701.7 of the California Corporations Code sets up two arguably contradictory rules. Subdivision (b) provides that unless displaced by “particular provisions” of the California Revised Uniform Limited Liability Company Act, the principles of law and equity supplement the CARULLCA. …
When Betting Crosses Regulatory Lines
Earlier this week, Suzanne Cosgrove wrote about the Commodity Futures Trading Commission’s decision to prohibit Congressional Control Contracts, which it described as “cash-settled, binary (yes/no) contracts based on the question: “Will <chamber of Congress> be controlled by <party> for <term>?” …
Someone's Knockin' At The Door, But It May Not Be The DFPI
Last week, the California Department of Financial Protection & Innovation issued a warning about yet another fraudster’s attempt to separate investors from their money:
The California Department of Financial Protection and Innovation (DFPI) has received information that an entity “BitsCyber”,…
Don't Say You Weren't Warned! Court Of Appeal Declines To Enforce Delaware Forum Selection Clause In Delaware Corporation's Certificate Of Incorporation
Ten years ago, I questioned in this space whether a Delaware forum selection charter provision would survive constitutional scrutiny if it involved a de facto waiver of a jury trial:
“Most of the discussion of bylaw forum selection clauses has…
When May Shares Be Voted Without A Proxy Or Without Transfer Into The Holder's Name?
In most cases, Generally speaking, only the record owners of shares on the record date are entitled to vote under the California General Corporation Law. As with most generalizations, however, there are exceptions. For example, Section 702(a) of the California…
Do Corporate Boards Necessarily Breach Their Fiduciary Duties When They Approve Illegal Conduct?
In a recent blog post on the Business Law Prof Blog, Tulane Law professor Ann M. Lipton opined:
As I previously explained in connection with the shareholder derivative claims against Fox Corp., corporate boards are prohibited from engaging in illegal…