Business Law Journal

California requires that businesses file a Statement of Information to maintain compliance and the legal standing of your business - corporations are required to file a Statement of Information annually in the month of registration, while LLCs are required to submit the Statement of Information biennially (and within 90 days of registration). One of the latest scams targeting business, both foreign and domestic, involves fraudulent or misleading requests to submit a California Statement of Information on the business’ behalf. These deceptive practices can pose severe risks to your business by exploiting your legal obligations and imposing exorbitant fees.

In the midst of the ongoing Coronavirus (COVID-19) pandemic, many state and local governments are recommending or imposing restrictions on gatherings of people, including at places of business. In some cases, certain businesses such as bars and restaurants are being required to close or modify their business operations. Additionally, many individuals are staying home and avoiding public places.

Owners conducting business through a legal entity often do so to limit personal liability and to protect assets unrelated to the business from commercial risks.  However, once formed, owners sometimes jeopardize those exposure limiting objectives by filing away their incorporation documents and neglecting corporate formalities.  That approach may work fine until, of course, an adverse party argues that the business entity should be disregarded as an ‘alter ego’ of the owners. 

The first quarter of 2019 is behind us and, as is tradition year after year for many of us, the time is ripe for a little Spring cleaning. 

In the legal drafting context, this is a good time for in-house counsel and other company professionals responsible for legal documentation to revisit old contract templates and forms routinely used in your business to ensure the relevant clauses are updated to reflect current law and best practices (or, better yet, to consult your outside counsel to conduct the review for you!).