Originally posted 2011-06-14 09:00:41. Republished by Blog Post Promoter
Previously we blogged about a pending case before the Supreme Court that had the possibility to significantly increase the liability of persons for assisting in the preparation of a “prospectus.” As of June 13, 2011, the Supreme Court handed down an opinion in that case, styled as Janus Capital Group, Inc. v. First Derivative Traders, No. 09-525 (S. Ct.).
The determination of this case is relevant to accountants and business lawyers who assist in the preparation of documents for the purpose of raising money for investment. The Janus Capital Group, Inc. case presented the question of who may be deemed to have “made” an untrue statement for the purposes of Rule 10b-5, and specifically whether someone who assisted in the preparation of a prospectus could “make” a statement through such assistance. As the result of a 5-4 decision, accountants and business attorneys may breathe a little easier. Continue reading “Can an advisor be held liable for the false statements in a prospectus made by another?”
Originally posted 2011-07-12 08:30:35. Republished by Blog Post Promoter
The short answer is, rarely. Virginia is an at-will employment state. This means that an employer can discharge an employee for any reason or for no reason at all, just not for an unlawful reason. An employer who terminates an employee for an unlawful reason may be liable to the employee. The question answer in this blog post is: when is a reason unlawful?
Originally posted 2011-01-05 09:57:12. Republished by Blog Post Promoter
For all you accountants, investment advisors, and even attorneys who provide advice and guidance to companies or other entities raising money or other property for investment purposes, it might be a good idea to pay particular attention to the
United States Supreme Court opinion, when issued, in the case of Janus Capital Group, Inc. v. First Derivative Traders, No. 09-525 (S. Ct.). This case was argued before the Court on December 7, 2010. The Court’s opinion should be issued sometime during the first half of 2011.
Janus Capital Group, Inc. is somewhat factually and legally complex. However, in very simplified terms, First Derivative Traders is attempting to assert primary Securities Exchange Act Section 10(b) fraud liability against an entity,
Janus Capital Management LLC, that “helped” and “participat[ed] in” preparing a prospectus. The prospectus was actually that of, and was issued by, Janus Funds, a separate entity. Janus Funds had its own lawyers review the prospectus. Further, the Funds’ Board of Trustees, which was primarily responsible for it, reviewed it, as did the outside Trustees of Janus Funds, who also had their own counsel review it.
The United States (i.e., the Securities and Exchange Commission) filed an amicus brief in this case advocating such indirect liability in private actions, never mind the right of private action was judicially, not statutorily, created.
Originally posted 2010-08-19 08:45:43. Republished by Blog Post Promoter
The analysis of the enforceability of noncompete agreements begins with the question “How did the covenant not to compete arise?” Employee covenants not to compete generally arise in one of two ways: 1) solely as a result of employment; and 2) arising as ancillary to another agreement, such as an agreement to purchase the prospective employee’s business.
Originally posted 2010-12-27 10:49:33. Republished by Blog Post Promoter
Raising money or obtaining other property for investment purposes from whatever source in Virginia, including from family and friends, implicates state and federal law.
Some may have read about the recent action for fraud filed by Andrew Cuomo, the Attorney General of the State of New York, against Ernst & Young, LLP, one of the largest accounting firms in the United States. Some, noting that this action was not brought under the Securities Exchange Act of 1934, may have wondered from whence the Attorney General’s authority arose. Authority arose under the Martin Act, a New York law initially passed in 1921, and amended and codified in 1982 in Article 23-A of the New York General Business Law.
What is important for those in the Commonwealth of Virginia attempting to raise money or obtain other property for investment purposes is that Virginia has similar securities laws. Virginia’s Securities Act is codified in Title 13.1, Chapter 5, of the Code of Virginia. As with that of the State of New York, the reach of Virginia’s Securities Act differs from, and is more extensive than, that of the federal securities acts.
Getting rid of an LLC member in your business can be difficult without an effective operating agreement
Originally posted 2010-08-20 09:35:32. Republished by Blog Post Promoter
It may seem hard to believe, but there’s a chance you and your fellow members in your limited liability company may not always get along. In fact, the relationship may get to the point where the majority of the members in the LLC wants to expel a member. As Lee Corso says frequently on ESPN Gameday, “Not so fast, my friend.”
Originally posted 2011-08-23 05:00:56. Republished by Blog Post Promoter
I teach as an adjunct faculty member at the William & Mary Law School. I find this part-time teaching gig very stimulating intellectually because the law students at W&M are extremely intelligent, diligent, and driven. This past week a new class of first-year law students arrived with great expectations about their futures. The reality of the job market, though, is that the legal profession has not been immune from the effects of this difficult economy.
Some of my second-year law students have also arrived back into Williamsburg, and I have been surprised at the number of students who report they worked as an “unpaid intern.” Although this practice is permissible in certain situations, these working arrangements with private law firms probably violates federal labor laws, and it is particularly distressing that it occurs in the practice of law. This blog post provides some guidance for your small business when deciding whether to “hire” an unpaid intern.
Originally posted 2011-03-15 09:00:12. Republished by Blog Post Promoter
[youtube PTMt5iVhobs nolink]
There are many questions to ask and many issues to resolve when you decide to start your Virginia business entity. The time to ask those questions and resolve those issues is before you enter into your business agreement.
Neal’s 3-minute slideshow presentation gives an a brief primer on the forms of entities that are available and questions to start your dialog with your business attorney and business partners. This slideshow combines basic information with more advanced concepts for the more experienced entrepreneur.
Tarley Robinson, PLC, Attorneys and Counsellors at Law
Originally posted 2010-09-22 05:35:58. Republished by Blog Post Promoter
The Common Interest Community Board (the “CICB”) revoked a management company’s license for regulatory violations. In a case reported in the September issue of the Community Associations Institute Law Reporter (Virginia Common Interest Community Board v. Sarraga t/a Lakeside Community Management, File No. 2010-00562, June 24, 2010), the CICB revoked the license of Sarraga t/aLakeside Community Management and issued fines totaling $2,000.
Originally posted 2011-05-12 09:00:25. Republished by Blog Post Promoter
It’s a simple fact of business life that you and your company’s fellow shareholders or members will not always see eye-to-eye. Furthermore, our personal lives change and that effects the level of willingness in which some participate in a business venture.
As in any relationship, businesses also reach that awkward stage in which a shareholder or member wants to leave his current business venture and start something new. We have discussed starting your business and provided guidelines for setting forth the rules for governing your business. This article addresses some of the difficulties that arise during the “break-up period.” For the purposes of this article, we will use the terms “shareholder” and “member” interchangeably, as well as the terms “director” and “managing member.”