Articles Posted in Corporations

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AdobeStock_101676859-300x200Corporations are subject to many fiduciary rules that govern their operations. Most business persons are familiar with the prohibition on interested transactions and placing one’s own financial interests ahead of the company’s. Yet the application of this rule varies widely from state to state. The Delaware Supreme Court has recently issued a ruling that will apply to the many businesses which fall under Delaware’s state laws of corporate governance. Learn more about the standard of review for interested transactions between a controlling shareholder and their subsidiary company:

In re MFW

The litigation started with a dispute between the shareholders of M&F Worldwide (MFW). A merger was proposed between the controlling stockholder and a subsidiary company. Minority shareholders objected to the merger and brought suit to stop it. Prior case law had subjected such transactions to the stringent standard of “entire fairness.” Yet, in this case, where there were two important procedural safeguards protecting the minority interest, the Court of Chancery held that the more lenient “business judgment” standard could be applied. The ruling was appealed to the Delaware Supreme Court. Because the Supreme Court affirmed the ruling, it has created a new legal standard under Delaware law.

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AdobeStock_268338488-300x191California business owners know that social media marketing is the way to reach today’s consumers. Many businesses have sought to and built successful relationships with social media influencers for effective content creation. However, there are legal issues that can arise in such business relationships. The Los Angeles business lawyers at Structure Law Group can help you prevent problems in the following areas:

Written Contracts

Some influencers have pre-printed contracts that they use as a standard for all transactions while others expect the business owner to take the lead in drafting contract terms. In either event, it is imperative that business owners carefully consider all the legal implications of a commission/commissioned work or contractual relationship of this type. Many contractual relationship problems can be prevented with unambiguous terms written into an enforceable legal contract. Here is just a small list of the terms that should be considered when entering into this type of contractual relationship:

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AdobeStock_183500602-300x200Business owners in Silicon Valley are well acquainted with all kinds of legal contracts. It is important to know your legal rights – as well as your obligations – under any contract. Many contractors try to bully others with threats of breach of contract and costly litigation. The experienced contract lawyers at Structure Law Group are here to help your business handle all types of breach of contract issues. Here are some of the most common disputes:

A Vendor’s Breach of Contract

Most businesses must enter into vendor contracts to get the goods and services necessary for their daily operations. If these vendors breach their contractual obligations, your business could be left unable to deliver on its own contractual duties to customers. A well-drafted vendor contract can help prevent confusion or ambiguity. Our contract attorneys can also help you determine the best course of action when a vendor breaches a contract. While litigation is sometimes necessary, it is not always worth the cost of a damaged business relationship with a trusted partner. An experienced contracts lawyer will be able to give you options for handling the problem.

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AdobeStock_326855505-300x204Courts across the United States have been impacted by the COVID-19 pandemic. With court closures, modifications of hours, countless restrictions, and case backlogs, courts (and litigants) have faced unique challenges.

As courts in California and across the country still face a significant backlog of cases due to the pandemic, many courts have embraced technology and are expected to continue using video and audio platforms and holding virtual hearings, depositions, and even trials in an attempt to improve public safety.

Below, we will talk about how the COVID-19 pandemic has changed California’s Superior Courts.

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AdobeStock_459683513-300x200Whenever a new president takes office, the business world speculates how their policies will affect corporate law and business. This speculation leads to some wild trading on the stock market, but business owners know they must take a more measured approach. The corporate lawyers at Structure Law Group are here to help you examine new Biden Administration policies and strategically plan for the effects they will have on your business.

Taxes

The Biden Administration has made no secret that its tax priorities are widely divergent from the tax policies of the Trump Administration. In general, the Biden tax policies are designed to curb the large tax breaks for large companies and wealthy individuals that were widely available under the Trump administration’s tax policies. Biden’s Build Back Better Agenda is focused on improving financial security for the middle class by easing tax burdens. U.S. Bank reports that these changes could affect taxpayers who:

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There are very few aspects of business that were not affected by the COVID-19 pandemic. Supply chain issues, staffing shortages, and remote work caused immediate problems, which have experienced some relief as the public health crisis is coming under control. As a result, there are significant changes that business owners must make to accommodate our new world. Mergers and acquisitions must still be performed carefully even within the parameters of a global public health crisis. This article explores how the pandemic has affected due diligence, deal terms, and contingencies for corporate M&A in the era of COVID.

Due Diligence Issues

Due diligence requires thorough attention to often voluminous and complex details. During the pandemic, it became clear how much work could be done remotely. That said, there are still certain things that must be reviewed in person. Profit and loss statements are not reliable if they are not supported by evidence obtained through in person review of various business operations, and new technology and other tangible products must be thoroughly examined in person to assess their market viability. It is critical for business owners not to cut corners on due diligence, even with the pandemic’s limitations. Our corporate lawyers know how to develop creative solutions for meeting due diligence obligations given these limitations.

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AdobeStock_189991100-300x200In 2018, lawmakers in California extended sexual harassment training requirements to employers who employ five or more employees and required such training for both supervisors and non-supervisors. When the law passed, the original deadline to complete anti-harassment training was set to January 1, 2020.

However, in 2019, California extended the deadline for initial compliance to January 1, 2021. Under the sexual harassment training requirements, covered employers (companies with at least five employees) must provide:

  • One hour of training to non-supervisory employees; and
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AdobeStock_250195228-300x192In September 2020, California Gov. Gavin Newsom signed into law Assembly Bill 979, also known as AB 979, in an effort to increase the diversity of the board of directors of publicly traded corporations headquartered in California. Corporations that meet the criteria must have at least one director from an underrepresented community by the end of this year.

In addition, the new law imposes strict reporting requirements to ensure that publicly traded companies comply with AB 979 and other diversity laws.

What is Assembly Bill 979?

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AdobeStock_333504091-300x200One of the many changes brought by the COVID-19 pandemic was the work-from-home shift. As millions of workers across the nation had to switch to remote work during the pandemic, many employers wonder, “How does working from home affect the productivity of employees?”

The impact that remote work has on workers’ productivity levels is a controversial topic. While some employees believe that they are more productive when working from home, others believe that their productivity decreased because they switched to remote work.

Since an increasing number of employees are working from home nowadays, more employers want to keep an eye on their work-from-home employees through the use of remote monitoring technologies.

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AdobeStock_429521227-300x212After California has fully reopened its economy on June 15, 2021, many California employers and employees alike have been wondering, “Can an employer compel its workforce to get vaccinated prior to returning to work?”

The short answer is, “Yes.” An increasing number of companies in California have mandated vaccination policies for their employees. Under federal and California state law, employers can require all or some of their employees to be vaccinated in order to return to work.

Under the Fair Employment and Housing Act (FEHA), employers are allowed to mandate vaccinations against COVID-19 as long as the decision to require an employee to be vaccinated harasses or discriminates against the employee. Employers should also keep in mind that they are required to provide reasonable accommodations related to employees’ disabilities and religious beliefs.

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