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© 2009-2019 Dana H. Shultz, Attorney at Law

Personal Cell Phone Use for Work Must be Reimbursed

Photo of the building housing the court that decided a case about reimbursing personal cell phone use by employees

California Court of Appeal for the Second District (Los Angeles)

This post discusses a 2014 case (Cochran v. Schwan’s Home Service, Inc.) which held that California employers must reimburse employees who use a personal cell phone for work.

Plaintiff Colin Cochran, as class representative, brought a class action lawsuit against Schwan’s Home Service (“Home Service”) on behalf of 1,500 service managers employed by Home Service. The suit sought, among other things, reimbursement of the managers’ work-related personal cell phone expenses. (more…)

What is an Operating Agreement?

The first page of an operating agreementI have used the term “operating agreement” in quite a few of this blog’s posts. However none of those posts explains in detail what a limited liability company (LLC) operating agreement must contain. This post provides that information.

The required contents of an operating agreement depend on the state in which the LLC is formed.

Operating Agreement – California

In California, where I practice, the definition of an operating agreement is set forth in Corporations Code Section 17701.02(s). (more…)

What are Repeated and Successive Transactions?

Seal of the California Secretary of State, with which a foreign entity must register once it enters into repeated and successive transactions within the stateIn Doing Business in CA? Be Sure to Register, I discussed when a foreign entity must register to do business in California. The test is whether the entity has transacted intrastate business, i.e., has engaged in repeated and successive transactions of business within the state. This post explores the meaning of “repeated and successive transactions“.

Repeated and Successive Transactions” Not Defined

The term “repeated and successive transactions” appears in Corporations Code Subsection 191(a). Unfortunately, that term is not defined. However, another portion of Section 191 provides a bit of help. (more…)

Who Is Bound by a Pre-incorporation Contract?

Logo for Avvo, where Dana Shultz answered a pre-incorporation contract questionThis post about entering into a pre-incorporation contract is based on a question I answered on Avvo. See Can I legally speak as my company in things like terms & conditions if I have not officially registered the company yet?

The term “pre-incorporation contract” properly should apply only to corporations, because that is the only type of business entity that is incorporated. Other types of business entities, such as limited liability companies (LLCs), are formed, rather than incorporated. However, as is discussed below, a pre-formation contract (in California, at least) is treated like a pre-incorporation contract. See 02 Development, LLC v. 607 South Park, LLC . (more…)

Fraudulent Email Prohibitions Supplement CAN-SPAM

Cover of the California Business and Professions Code, which has a section about fraudulent emailIn Commercial E-mail and CAN-SPAM: What You Need to Know, I discussed how the federal CAN-SPAM Act makes commercial email more truthful, more transparent and more avoidable. This post addresses how California law concerning fraudulent email supplements CAN-SPAM.

In particular, this post discusses preemption, by which, under certain circumstances, U.S. federal laws can invalidate state laws that address a given subject matter. (more…)

Can Parties Enter Into a Perpetual Contract?

Logo for Quora, where Dana Shultz answered a question about entering into a perpetual contractThis post is about whether parties may enter into a perpetual contract (one that never ends).

It is adapted from my answer to a question on Quora. See Is it possible to structure a contract with no end date?

It turns out the the answer depends, to some extent, on which state’s law applies. (more…)

What is Successor Liability and Why Should I Care?

Logo for Quora, which was the inspiration for this post about successor liabilityThis post about successor liability is prompted by a question that I answered recently on Quora. (See Can I dissolve my corporation and transfer its website to my personal ownership?)

The following is oriented somewhat toward California law, but similar considerations likely apply in other states. (more…)

Good Faith and Fair Dealing – Part of Every California Contract

Logo of Baskin-Robbins, party to case about implied covenant of good faith and fair dealingThis post discusses and explains the covenant of good faith and fair dealing.

For decades, courts have held that this covenant is implied in every California contract.

Purpose of Good Faith and Fair Dealing

In 1942, the California Supreme Court stated that “in every contract there exists an implied covenant of good faith and fair dealing.” The intent of this covenant is that “neither party shall do anything which will have the effect of destroying or injuring the right of the other party to receive the fruits of the contract“. (Universal Sales Corporation v. California Press Manufacturing – emphasis added.) (more…)

Consumer Non-disparagement Clauses Nixed in California

Yelp logo, symbolizing prohibition of consumer non-disparagement clauses under California lawEarlier this month, Governor Brown approved California Assembly Bill No. 2365. This bill added Civil Code Section 1670.8, which prohibits non-disparagement clauses in consumer contracts.

Statute Prohibits Non-disparagement Clauses

Core protections are set forth in Subsection (a) of that statute. (more…)