Corporate Finance Law Blog : Corporate Finance Lawyer & Attorney : Davis Wright Tremaine Law Firm

Time to get back in the game?
February Finance Community Meeting

2/18/2010
5:00pm to 7:00pm
Davis Wright Tremaine, LLP (Davis Center)

The Washington Technology Industry Association has assembled a diverse panel of speakers from financial institutions, money managers and industry executives to discuss current trends and the current options and strategies to meet your needs. Whether you have a lot of cash, or only a little, an update on the current investment and corporate cash management environment will prove interesting.

Panel:
Chad Cohen, Zillow.com
Rob Derry, Silicon Valley Bank Asset Management
George Taylor, Moss-Adams Weath Advisors, LLC

Moderator:
Glenn Walcott, former CFO, Big Fish Games

Join the meeting for happy hour, networking and further discussion. Attendance is being limited to 50 participants. Click here for more information or to register.

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How does Washington corporate law determine whether a shareholder's derivative complaint should be dismissed for failure to make a demand on the corporation?  The Washington Supreme Court had this say:  

"In a well reasoned opinion, Judge Thomas Zilly of the federal trial bench concluded that Washington would likely follow Delaware’s demand futility standard. In re Cray, Inc., 431 F. Supp. 2d 1114, 1121 (W.D. Wash. 2006) (citing Rales, 634 A.2d at 932 & n.4 and Aronson, 473 A.2d at 814). We agree. Delaware’s courts are well versed in this area. Until our legislature declares otherwise, Washington is a demand futility state and follows Delaware."

  You can read the opinion here.

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By Sarah E. Tune and Mohsen Manesh

When a company begins experiencing financial distress that threatens its continued existence, its directors and officers must be vigilant about exercising their fiduciary duties. The company's equity holders as well as outsiders will view decisions made during this time with particular scrutiny. Additionally, there are areas of law that attach personal liability to directors and officers; and, while risk of personal liability always exists, even in healthy firms, the potential for liability is heightened when a company is in financial distress.

Compounding the risks of personal liability, a financially distressed company may lack the resources necessary to indemnify its directors and officers, notwithstanding the indemnification agreements it may have with such individuals, and may even allow its director and officer insurance policies to lapse, because it is simply unable to pay the premiums. Continue reading...

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 By Rachel E. Dobrow Stone, Allen E. Briskin, Gerry Hinkley, Rebecca L. Williams, Paul T. Smith, 

Jill H. Gordon and Megan Vogel

Title XIII of the American Recovery and Reinvestment Act of 2009 (the Act), signed into law by President Obama on Feb. 17, 2009, among many other things, provides funding and incentives for the development, adoption and upgrade of health information technology (HIT). Although there might be disagreement over whether these measures will provide the type of economic stimulus that the Act generally is intended to create, many commentators have concluded, given the current state of the economy, that their inclusion in the Act was the only means to achieve meaningful health care technology policy reform in this session of Congress. Continue reading...

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By DWT Employment & Labor Practice Group

Companies covered by the Washington unemployment compensation system that want to exempt corporate officers from unemployment coverage must mail the required exemption forms to the Washington State Employment Security Department (ESD) by Jan. 15, 2009. (Please see our September 2007 advisory bulletin, “Unemployment Law Revisions Set Forth New Employer Requirements,” which summarizes changes to the state's unemployment compensation laws and provides some history behind the changes.)

While previously the default was that corporate officers were generally not covered by unemployment, the new default is that they are automatically covered (and unemployment contributions must be made on their earnings) unless they meet certain criteria and are specifically exempted by the corporation. The exemption has to be on an ESD form and must be postmarked or faxed by Jan. 15, 2009, to be effective. If it is not, the exemption would not be effective until Jan. 1, 2010. Separate requests must be submitted for each officer. The exemption requirements vary with different types of corporations. Continue reading... 

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By Laura A. Baumann

On Oct. 14, 2008, the United States Department of Treasury announced the Troubled Asset Relief Program, or TARP Program, which is one of several recent government initiatives to improve the strength of financial institutions and enhance market liquidity. We summarized the highlights of the program in an advisory bulletin in October. On Nov. 17, 2008, the Treasury released the term sheet and frequently asked questions for certain privately held financial institutions applying for the TARP Program. This bulletin will briefly summarize the recent developments with respect to the TARP Program. Continue reading...

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"With recent events in the financial markets putting a squeeze on business credit, many aspiring entrepreneurs may search for novel ways to acquire business capital. One that has gained IRS’s attention, and coverage in the press, is to withdraw money from existing retirement accounts and then channel it into a new retirement plan. On October 1, 2008, the IRS released initial guidelines on the acceptability of these arrangements."

For more, read here.

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"We affirm the district court's ruling that the government deprived Defendants-Appellees of their right to counsel under the Sixth Amendment by causing KPMG to place conditions on the advancement of legal fees to Defendant-Appellees, and to cap the fees and ultimately end them.  Because the government failed to cure the Sixth Amendment violation, and because no other remedy will return Defendant-Appellees to the status quo ante, we affirm the dismissal of the indictment."

http://www.ca2.uscourts.gov:8080/isysnative/RDpcT3BpbnNcT1BOXDA3LTMwNDItY3Jfb3BuLnBkZg==/07-3042-cr_opn.pdf

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The attorney-client privilege act before Congress.

The discoverability by the government of tax workpapers.  See TaxProfBlog article.

Potentially new and/or revisions to the Department of Justice's McNulty memo.  See thecorporatecounsel.net Blog entry regarding this.

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July 22, 2008

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By Robert Corn-Revere and David M. Shapiro

On July 22, 2008, a unanimous panel of the United States Court of Appeals for the 3rd Circuit struck down the Child Online Protection Act (COPA) in ACLU v. Mukasey, holding that COPA failed to withstand strict scrutiny under the First Amendment and represented an impermissibly vague and overbroad restriction of speech. COPA threatened to chill Internet speech by providing civil and criminal penalties for anyone who knowingly posts “material that is harmful to minors” on the Internet “for commercial purposes.”

The case was filed the day after COPA became law in 1998 and was originally called ACLU v. Reno. A series of decisions in the case prevented COPA from ever taking effect—and today's decision improves the chances that it never will. It has been the subject of two previous Supreme Court decisions, and may be reviewed a third time. The decision and the Supreme Court’s response will greatly affect producers and posters of online content, particularly those who post "adult-oriented" material, or indeed any material that is sexual in nature. Continue reading...

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July 21, 2008

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By Robert Corn-Revere, Ronald G. London and Amber Husbands

On July 21, 2008, the United States Court of Appeals for the Third Circuit unanimously rejected the $550,000 forfeiture penalty and finding of indecency violation levied against CBS for the 2004 Super Bowl halftime show featuring Janet Jackson and Justin Timberlake. The appeal involved the live broadcast of the show, which culminated in an unscripted nine-sixteenth-second exposure of Janet Jackson’s breast.

The court held that the FCC arbitrarily and capriciously departed from its prior policy of excepting fleeting broadcast material from the scope of actionable indecency. It also determined the FCC could not impose strict liability on CBS, or hold it liable for the conduct of Jackson and Timberlake because they were independent contractors and not CBS employees. Continue reading...

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Senators Levin, Coleman, and Obama have introduced a bill [text can be found here] titled the Incorporation Transparency and Law Enforcement Assistance Act.  A summary of the proposed bill can be read here.  Senator Obama's web site contains the following summary.

The proposed bill would substantially change state laws requiring the states to gather beneficial ownership information of private companies and make that information available to federal investigators.

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