As is clear from this extensive list, a foreign corporation that does a majority of its business in California is essentially treated as a domestic corporation in many key respects, including corporate governance. Thus, if a corporation intends to conduct most of its business in California, incorporating in Nevada - or in any other state for that matter -- would not be advantageous.
Mergers and Acquisitions
Shiotani & Inouye ("S&I") is a small, general business law firm that focuses on providing high quality legal services to a clientele of individuals, partners and closely-held businesses engaged in diverse industries. We offer both general and specific legal services that meet our clients' needs in the areas of business formation; individual and business tax planning; business succession planning; real estate transactions involving acquisitions, sales and leasing; estate planning; probate; mergers & acquisitions; and general commercial transactions.
Business Formation
Business Disputes
Business Transactions
Limited Liability Companies
Further, the alter ego doctrine is not limited to shareholders and their corporations: affected individuals can also include incorporators, officers, directors, and inside and outside counsel and financial advisors. The doctrine also applies to situations involving parents and subsidiaries and other inter-corporate affiliations. Moreover, the California Corporations Code expressly applies the doctrine to limited liability companies. See Cal. Corp. Code § 17101. Significantly, however, California courts have rejected a "reverse alter ego" doctrine in which a plaintiff satisfies its claims against an individual shareholder by reaching past the shareholder to the corporate assets. Postal Instant Press, Inc. v. Kaswa Corp., 162 Cal. App. 4th 1510 (2008).
Unfair Competition
A Web site or online service operator violates OPPA if it fails to comply with the statute's provisions or its own privacy policies either (a) knowingly and willfully; or (b) negligently and materially. Once notified of non-compliance, an operator has 30 days in which to cure the problem. OPPA does not contain any specific enforcement or remedy provisions; however, it is likely that OPPA violations will be prosecuted under California's unfair competition law, which provides for civil penalties of up to $2,500 per violation. Individuals may also bring private actions for relief through the unfair competition law.
The test shall also be applicable with respect to workers compensation. Labor Code Section 3351 specifically refers to Section 2750.3 and includes in the definition of “employee†: “(i) Beginning on July 1, 2020, any individual who is an employee pursuant to Section 2750.3. This subdivision shall not apply retroactively.†Cal. Lab. Code § 3351.
Employment Contract
Electronic signatures have also been challenged in California courts in the context of employer-employee agreements, in particular, agreements to arbitrate disputes between the employer and employee. Notably, the issues raised by such cases involve employee’s intent to sign and whether the signature is, in fact, that of the employee. A pair of cases gives insight and guidance in this context. In Ruiz v. Moss, 232 Cal. App. 4th 836 (2014) ("Ruiz"), the Court held that the employee could not be held to an agreement to arbitrate that was generated through the employer’s electronically administered human resources platform when (1) the employee had no recollection of signing the agreement; and (2) the employer could not demonstrate that the employee was the person who had actually signed the agreement. The employer merely stated that each employee was required to log in to the employer’s system using his or her login ID and password to sign the agreement. In concluding that this statement was insufficient to authenticate the employee’s signature, the Court relied upon Section 1633.9, which states "An electronic record or electronic signature is attributable to a person if it was the act of the person. The act of the person may be shown in any manner, including a showing of the efficacy of any security procedure applied to determine the person to which the electronic record or electronic signature was attributable." Cal Civ. Code § 1633.9. Here, the employer merely inferred that the employee signed the agreement. The employer could not verify the process through which it ensured that the employee was the only one who could have electronically signed the agreement. But what exactly should the employer have done to authenticate the employee’s signature? A case decided this year provides employers with much needed guidance on this point. In Espejo v. Southern California Permanente Medical Group, 246 Cal. App. 4th 1047 (2016) ("Espejo"), the Court held that the employer did make the required showing. Relying upon Ruiz, the employee in Espejo claimed that he did not recall signing the DRP (the agreement in question); and further that his practice was to review documents carefully before he signed them. Accordingly to the employee, he would not have signed an 8-page agreement within one minute after signing the employment agreement, an act which would have prompted him to review and sign the disputed agreement. (Each agreement signed by the employee was identified with a time stamp as well as the IP address where the signing occurred.) The Court, however, distinguished Ruiz. In doing so, the Court stressed that the employer "offered the critical factual connection that the declarations in Ruiz lacked." Specifically, the employer was able to detail the specific security precautions that it took to ensure only the employee himself could have created the electronic signature. Such precautions included (a) issuing a unique user name and password that
Shiotani & Inouye offers general and specific legal services in the areas of business formation; individual and business tax planning; business succession planning; real estate transactions involving acquisitions, sales and leasing; estate planning; probate; mergers & acquisitions; and general commercial transactions.
There are many legal terms used in the estate planning context, many of which are confusing to those most affected - the individuals planning for the disposition of their property and those who may (or may not) stand to benefit from such dispositions. This confusion arises not only because some terminology is decidedly "legalese", but also because in the estate planning context some words may have different meanings than expected based on everyday definitions of the underlying words. The following provides an examination of certain commonly misunderstood terms used in the California trust and estate context...
Wills
The language typically used in living wills presents problems similar to that used in springing powers-of-attorney and can be similarly amended. However, it is important to review the language in such documents carefully to ensure that the stated goals of the principal are met. For example, in some living wills, an appointment only becomes effective once a physician determines that the declarant is incompetent AND is in a terminal state. Additionally, some living wills limit the scope of the appointee's authority and any medical disclosure would of course have to track such limitations. Accordingly, if a declarant wants his or her appointee to have the authority to make health care decisions prior to a medical determination of incompetency and/or terminal state, then the authorizing language should be similarly broad. Alternatively, rather than revising the language of the living will itself, a declarant can simply execute a durable power-of-attorney specifying the circumstances under which medical disclosure is authorized, the extent of the disclosure, and, of course, the recipient(s).
Power of Attorney
"Power of Attorney" is yet another misunderstood term, as it has nothing to do with an attorney (other than the one who may have drafted the document). Rather, a Power of Attorney is a document in which an individual appoints an agent, termed an "attorney in fact" to handle his or her financial affairs in the event of incapacity.