I will not be using the Statutory Supplement previously assigned. Don’t confuse that with my Supplement. My Supplement has cases that we will review but are not in the Hamilton text. It also has forms we will look at, a Glossary, an article on fiduciary duties, and some other things. It is here.
Also, I would not bother with older versions of my Summary of Law of Business Orgs. Get the 2019 verion ($6 bucks). I made changes in a few areas, primarily about agency and close corps.
This is a class action against debt collectors for violation of the Telephone Consumer Protection Act. The lender hired a loan servicing company. It hired debt collectors. The lender said “We didn’t make any improper calls! Our agents did.” Very nice summary of agency law.
“Henderson advances two agency principles that she believes makes USA Funds liable for the debt collectors’ TCPA violations—ratification and implied actual authority.”
My summary of the case.
Henderson v. United Student Aid Funds, Inc., 918 F.3d 1068 (9th Cir. March 2019)
Issue: Did the court err in granting summary judgment here on the issue of whether the lender here was liable for the conduct of its agents?
Holding: Yes. “[A] reasonable jury could find that USA Funds ratified the debt collectors’ calling practices by remaining silent and continuing to accept the benefits of the collectors’ tortious conduct despite knowing what the collectors were doing or, at the very least, knowing of facts that would have led a reasonable person to investigate further.”
Appeal from district court, Southern District California Continue reading
We will discuss this in class on Friday. Take a look. It’s 60 pages so bring it on your laptop – or you can print it out if you want. Judge Tighe Tentatives
This coming Friday is Class 10. We will discuss preferences and fraudulent conveyances. The cases are pretty short.
Class 10 – March 15, 2019
Cunningham v. Brown 281
Fraudulent Conveyances 286
BFP v. Resolution Trust Corporation 287
Dean v. Davis, Jr. 292
In re Beverly 294
Shapiro v. Wilgus 304
Bailey v. Glover 306
Attached is my analysis and comments on the final exam for last semester. corp fin 2018 w analysis
This is a great program
Save the Date: Bridging the Gap—Saturday, March 30, 2019
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If there is a three member board and each one is also an officer (President, Vice President and Secretary)… at a board meeting, they can fire an officer correct? If two out of the three don’t like one of the officers…… But of course, that still means, that person that got fired would still be a member of the board since it is the shareholders that vote for the board. Which is essentially the same people here. The shareholders and the board (close corp).
Sorry if my question is confusing. Just seems like it is going to be going around full circle here. The board fires an officer, yet that person fired is still going to be on the board since they have enough stock to keep themselves on there.
How do we in the real world get that person out? We would just have to somehow get his shares? Buy them out?
I represented a guy once who owned one-third of the stock and was a vice president of the corp getting a huge salary. The other two decided to fire him as VP and take away his salary. This was a non-close corp state – and in any event there was no shareholders agreement. After he was fired, his salary stopped. He got to go to BOD meetings but was out voted obviously on everything. He had no right to be involved in the operations of the business, only to vote at BOD meetings on all consequential decision. If it had been a state that recognizes close corps, the two bad guys would have had to establish that they fired him for reasonable business reasons, not just to get rid of him because they didn’t like him any more.
Your question is why a good lawyer is needed at the beginning of the new busijness relationship. To make sure they have thought through how this is going to work. Especially as to surviving spouses.
From a student:
I understand that partnership is “An agreement b/w two or more persons to carry on a business TOGETHER for a profit.” I also understand that within the meaning of the word “persons” in the partnership definition it includes that person can be “persons, corporations, LLC’s, etc.” Thus, this indicates that when we have a corporation issue on a hypothetical, it means that we may also have a discussion of partnership.
What is confusing me though is the fact that partners are liable for partnership debts and I cannot understand how this fact about partners being liable for partnership debts would go on a discussion about corp and partnership. So, who is liable for the partnership debt in a corp/partnership hybrid question?
Answer: Suppose two corps decide to do business together, perhaps to run a food truck, or build a building or develop software. At that point there are three entities, the two corps and the partnership. Any debts that arise in the course of running the food truck etc would be a liability of the partnership; the partners of the partnership would be liable for the debts. Continue reading