Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
19 Cards in this Set
- Front
- Back
What are the two views in what a shareholder must show in demanding corporate information?
|
1. commonlaw
2. Statutory |
|
What must a plaintiff show to get records pursuant to the commonlaw method?
|
1. Proper purpose- that it is related to plaintiffs interest as a shareholder.
2. For each item wanted, the S/H must show that the item is essential to the proper purpose. 3.There needs to exist a credible basis to find probable corporate wrongdoing satisfied through documents, logic, testimony or otherwise. |
|
In regards to the commonlaw and plaintiffs demand for information, will a mere curiosity on behalf of the S/H or a desire for a fishing expedition suffice to satisify a credible basis for the records?
|
no
|
|
What is the Statutory method regarding S/H demand?
|
1. Usually has a duration or amount of ownership provisions.
2. Plaintiff still has the burden for all other records except stockholder lists. 3. By statute, it is now a burden of the corporation to prove that the demand for a stockholder list is for an improper purpose. Note: the court can impose conditions on release of documents. |
|
What is a cede list?
|
Cede & Co is one of the largest of the four regional depositories. A cede list is a list of owners of stock behind the depositories (usually brokerage firms). The cede list just lists the brokerage companies.
|
|
What is a NOBO list?
|
Non-objecting beneficial owners has the names of the acutal people that vote (the real owners.). It's the actual list of the shareholders who say "you can tell the people who i am"
|
|
What is a proxy?
|
written authorization given by a shareholder to someone else to represent him and vote his shares at a shareholders meeting.
|
|
What is a proxy solicitation?
|
The process by which shareholders are asked to give their proxies
|
|
What is a proxy statement?
|
A written statement sent to shareholders as a means of proxy solicitation.
|
|
How do we know if a company is subject to sec law?
|
They are only those corporations that are registered under SEC Section 12 which have:
1. There is a connection with interstate commerce. 2. 500 shareholders or more, and more than $10 million in assetw or 3. Registered on a national stock exchange. |
|
What is the process to begin an analysis for security fraud?
|
look at all in the following order:
1. 10b5 2. 16b 3. c/l |
|
For a security fraud case, what is a proper defendant?
|
A proper defendant is an insider, someone who has access to confidential corporate information because of position, or relationship to the corporation.
|
|
what is the test for a proper plaintiff in a securities fraud case?
|
Normally a purchaser or seller.
|
|
Pursuant to the security fraud and the commonlaw, is there liability regarding exchanges of stock?
|
no
|
|
what are the prima facie elements for a 10b violation?
|
1. Misrepsentation/ommission
2. Materiality 3. Fact 4. Scienter 5. Causation 6. reliance 7. harm |
|
How do we discuss the materiality element for a contingent event in regards to security fraud pursuant to rule 10b?
|
we weight the probability of sucess against gravity.
|
|
What is the three levels of scienter?
|
Intentionality
Recklessness Negligent |
|
What is an example of a rebuttable action in regards to reliance under a 10b action?
|
the person whould have went ahead with the transaction regardless if he knew of the action or not.
|
|
What are the two elements of causation under a security fraud action pursuant to 10b5?
|
Did misrepresentation/omission cause the transaction and as such caused the harm suffered?
|