State Legislative Updates

2018 – A Year in Review for Corporation, LLC, and Other Business Entity Laws

2018 – A Year in Review for Corporation, LLC, and Other Business Entity Laws

Every year there are significant legislative and judicial developments affecting state business entities. CT’s Resource Center is one of the best places to go to find out about these developments. In this white paper, "2018 – A Year in Review in Corporation, LLC, and Other Business Entity Law", we have compiled some of the major state legislative alerts and case law summaries from 2018.

But before reading the Year in Review take this quiz and see how much you remember about what happened in 2018. Can you name the states we are describing? The answers can be found in the white paper.

  1. In September, the Governor of this state signed a law requiring public corporations incorporated or headquartered in the state to have at least one female on their board of directors.
  2. In August, this state authorized a new statutory transaction in which a domestic limited liability company could divide into two or more newly formed LLCs.
  3. In June, the US Supreme Court upheld the sales tax law of this state, which required out of state sellers to collect and remit sales taxes even if they didn’t have a physical presence in the state.
  4. In May, this state joined a handful of other states by authorizing the formation of a Benefit Limited Liability Company.

 

EXCERPT

Keeping track of the changes to business entity statutes is important for the company’s managers, owners, investors, and advisers. But it can be hard to do, considering how often the laws are amended and how many judicial decisions interpreting those laws are rendered each year. To help all interested parties keep up, CT has compiled some of the significant legislative and case law developments we have tracked and reported for you in our Resource Center during 2018.

Alabama

House Bill 72, effective January 1, 2019, enacts a new partnership law, governing the formation, operation and dissolution of general partnerships and limited liability partnerships. 

Arizona

House Bill 2603, effective August 3, 2018, amends the corporation law to provide that the words “writing” and “written” include blockchain technology.

Campbell Law Group v. Jagelski, No. 1 CA-CV 17-0032, decided August 14, 2018. The Arizona Court of Appeals held that a law firm that obtained a charging order against a clients’ interests in LLCs in order to collect unpaid fees could not substitute itself as the member. A charging order only gave the law firm the rights of an assignee.

California

Assembly Bill 375, effective January 1, 2020, enacts the California Consumer Privacy Act of 2018, which, among other things, requires businesses that collect or sell the personal information of California residents to disclose, upon request, the information collected or sold and how it will be used and to whom it was sold or disclosed, and, upon request, to delete the personal information that was collected.

Assembly Bill 2237, effective January 1, 2019, amends the General Corporation Law regarding shareholder inspection of records.

Senate Bill 838, effective January 1, 2019, amends the General Corporation Law and Social Purpose Corporations Act regarding the use of blockchain technology in certain corporate record-keeping.

Assembly Bill 2503, effective January 1, 2019, amends the Corporations Code by subjecting domestic corporations and LLCs to administrative dissolution or administrative cancellation under specified circumstances.

Senate Bill 826 amends the Corporations Code to provide that no later than the close of 2019 a publicly held domestic or foreign corporation whose principal executive offices, according to its SEC 10-K form, are located in California, shall have...

 

 

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