Monthly Archives: March 2014

Piercing the Corporate Veil as Applied to Shareholders

        Companies incorporate for a variety of reasons, chief among them to protect themselves from certain levels of liability to the company, as well as to the shareholders.  Corporations are themselves legal entities with the freedom to buy, sell and make certain decisions much as an individual person would.  Under corporate law,

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Broker-Dealers in M&A Deals

Recently, the Securities and Exchange Commission released a No-Action Letter regarding the eligibility of certain broker-dealers, or individuals who help facilitate mergers and acquisitions as an intermediary between the (or more) parties to the transaction. What is a No-Action Letter? The SEC issues No-Action Letters at the request of private parties to inform them how

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Breakup Fees in M&A

        Breaking up is hard to do, and in the world of mergers and acquisitions, it can often result in a hit to one of the party’s wallet.  In acquisitions, the legal agreements underlying the takeover will often include a provision for a “breakup fee.”  Traditionally, a breakup fee is a fee

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CEO Pleads Guilty to Securities and Wire Fraud

On October 3, 2012, Robert Kelly, CEO of software development company Wwebnet, Inc., was arrested on charges of securities and wire fraud. According to Forbes, from 2004 to 2008, Kelly “solicited investors to send money to various Wwebnet-related bank accounts, telling them that the funds would be used to develop software comparable to Apple iTunes,

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Corporate Shareholders Meetings

Earlier this month, Apple hosted its annual shareholders meeting.  Corporations and companies hold shareholders meetings each year in order to update shareholders on progress by the company, on potential direction and initiatives going forward, internal changes or reforms, revenue and profit statistics, and new innovations and products that are in development or are ready to

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The Lesson of Tax Avoidance for Emerging and Established California Businesses

According to Bloomberg, “[m]ultinational tax avoidance has risen to the top of the international political agenda,” and Amazon, the world’s largest online retailer, is coming under fire in the United Kingdom for just this issue. The company was sued for trademark infringement by soapmaker Lush, and a judge recently ruled in favor of Lush and

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Shareholder Approval in Mergers and Acquisitions

This past week, as reported by The New York Times, private equity firm Cerberus Capital Management acquired the grocery store chain Safeway in what amounted to the biggest leveraged buyout of 2014.  Cerberus already owns grocery chain Albertsons, and intends to merge Safeway and Albertsons together.  Cerberus paid the stock price plus a 17% premium,

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Update on Patent Trolling: What Your Startup and Small Business Should Know

Last year, we devoted considerable attention to an issue that impacts many small businesses and startups: Patent trolling. As a reminder, patent trolls, or patent assertion entities, are shell companies that exist solely for the purpose of asserting that they should be reimbursed because they hold patents that are being infringed upon, mostly by an

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