PREFERRED STOCKHOLDERS LOSE CLEVER REDEMPTION ARGUMENT

Date: February 3rd, 2011

As many company founders know, preferred stock financings with venture capital firms and other savvy investors frequently involve a redemption right. The redemption right gives an investor the right at some time in the future to compel the company to buy back the stock the … Read More »

CONGRESS TIGHTENS STANDARDS FOR ACCREDITED INVESTORS

Date: October 11th, 2010

In the wake of the 2007 Wall Street crash and economic recession, the Obama Administration has responded with attempts to reform financial regulation in America. The most sweeping changes to financial regulation can be found in the Dodd-Frank Wall Street Reform and Consumer Protection Act, … Read More »

NEW YORK COURT HOLDS GENERAL COUNSEL WAIVED ATTORNEY-CLIENT PRIVILEGE BY NOT MAINTAINING ACTIVE BAR STATUS

Date: October 5th, 2010
Categories: Corporate Law

One of the most important tools executives have to investigate potential legal issues is the ability to speak openly with in-house company lawyers without fear such conversations will become public. It is reasonable for executives to think conversations with in-house counsel are always protected by … Read More »

CONGRESS REVERSES COURSE; ELIMINATES SEC EXEMPTION TO FREEDOM OF INFORMATION ACT

Date: September 30th, 2010

One of the most controversial provisions of the Dodd-Frank Wall Street Reform and Consumer Protection (Dodd-Frank Act), recently signed into law by President Obama, is Section 929I, which allows the Securities and Exchange Commission (SEC) to withhold documents requested by the public pursuant to the … Read More »

REVERSE STOCK SPLITS CAN BE USED TO FORCE OUT MINORITY SHAREHOLDERS, SAYS WASHINGTON SUPREME COURT

Date: September 28th, 2010
Categories: Corporate Law

On July 22, 2010, the Washington State Supreme Court dealt a serious blow to the prospects of minority shareholders who are forced out of corporations through corporate restructuring techniques that are expressly allowed under the Washington Business Corporations Act (WBCA). One of those techniques is … Read More »

COURT RULES AGAINST MORE RED TAPE FOR FRANCHISE REGISTRATIONS

Date: August 17th, 2010

Anyone who wants to sell a franchise in Washington needs to make sure the franchise offering has been reviewed and approved by the State, and all necessary information is disclosed to buyers. Washington franchise law is now much clearer about how subfranchisors can rely on … Read More »

NOVARTIS DRUG REPS NOT EXEMPT FROM OVERTIME LAW, SAYS 2ND CIRCUIT

Date: August 5th, 2010
Categories: Employment Law

Earlier this year, I wrote an article discussing the storm brewing over the issue of whether outside sales representatives are entitled to overtime compensation under the federal Fair Labor Standards Act (FLSA). Lawsuits had been filed against some of the world’s largest pharmaceutical companies on … Read More »

US SUPREME COURT SIDES WITH EMPLOYER IN EMPLOYEE PRIVACY CASE

Date: July 22nd, 2010
Categories: Employment Law

Last month, I posted an article discussing a general trend in the courts recognizing greater privacy rights for employees using employer-provided technology, despite employers’ policies advising employees they had no reasonable expectation of privacy in communications made using employer-provided technology. One of the cases I discussed, … Read More »

DELAWARE COURT OF CHANCERY RULES PREFERRED STOCKHOLDERS CAN BRING STOCKHOLDER DERIVATIVE ACTIONS

Date: July 1st, 2010
Categories: Corporate Law

In MCG Capital Corp. v. Maginn (Del. Ch., Civil Action No. 4521-CC, May 5, 2010), the Delaware Court of Chancery decided the first case to come before it directly addressing the standing of a preferred stockholder of a Delaware corporation to bring a stockholder derivative … Read More »

IMPORTANT CHANGES TO LLC ACT EFFECTIVE JUNE 10, 2010

Date: June 8th, 2010

Back in October of 2009, I wrote an article on latent defects in Washington’s Limited Liability Company Act, RCW 25.15. et seq (the “Act”) highlighted by Substitute House Bill 1592 and the Washington Supreme Court’s May 14, 2009 decision in Chadwick Farms Owners Association v. … Read More »