Gary Pruitt, who worked for McClatchy for 28 years, stepped aside as president, CEO and board chairman, to make way for Patrick Talamantes, who will be the new CEO and president. Kevin McClatchy, a member of the family for whom the company is named, will become the board chairman.
Pruitt is leaving to become the president of The Associated Press.
McClatchy, which owns The Sacramento Bee, is also making changes to other positions, including treasurer and chief financial officers. In times of transition like this, a brush-up on employment law best practices can be helpful. That's because at the C-suite level, many employees expect employment contracts, complicated benefits arrangements or other agreements. Naturally, no business owner wants to agree to something he or she doesn't understand, so many of them make sure they have a trusted business and corporate law attorney who understands employment issues work on their behalf as these agreements are being negotiated.
]]> Being savvy about employment agreements is important because the right agreement can help you attract the top-notch talent you need without overinvesting in those workers. If you feel your strategy regarding employees and how to manage them could use a fresh look, you might consider speaking to an attorney today and going over such things as employment contracts, bonus agreements, benefits structures and recruitment methods.Source: The Sacramento Bee, "New CEO takes over at The McClatchy Co." Mark Glover, May 17, 2012
]]>The business, Posh Puppy Boutique, started out as an eBay seller. Then, it became its own website. Now, it is at last a "real" brick-and-mortar store. Its story, and those stories of the countless other businesses just like it, are a testament to how the Internet is changing business development.
]]> Posh Puppy Boutique, which has been selling high-end dog accessories for five years, has had a lot of success with its Internet-only model, but the owner recently told a Sacramento newspaper she was excited to open a new location because she wanted her customers to "touch and see our products in person." She also said she looking forward to "serving customers in a more personal way."Many businesses get a start this way because have an Internet presence is a good way to see if customers like your product or service before you invest in real estate, staff and too much of an inventory.
If you are considering starting your own business, it may be helpful to speak to a lawyer who understands business and corporate law. He or she may be able to help you take your vision from concept to reality. Even if you have been diligent about doing your research, it's not unlikely there are one or two things you have forgotten or need help with and the assistance of a lawyer often helps keep things on track.
Source: The Sacramento Business Journal, "Posh online pet retailer makes physical debut in Rocklin," Melissa Wiese, May 17, 2012
]]>Recently, Yahoo, one of the Bay Area's most established tech companies, learned that its CEO may have falsified his resume. The CEO, Scott Thompson, denies that he took any liberties with his resume, but Yahoo cannot take the allegation of resume falsifying lightly.
]]> Specifically, Thompson had told Yahoo that he had accounting and computer science undergraduate degrees, but it now appears that he only has an accounting degree. Before he worked at Yahoo, Thompson worked for PayPal and that company's official biography of Thompson states he only has an accounting degree. This is a big deal because Yahoo reported that Thompson had an accounting degree to the Securities and Exchange Commission, which in turn makes the biographies available to the public under the theory that investors have a right to know who is leading the company asking them for money.In response, Yahoo has formed an independent board that will investigate Thompson's past as we all as look into how it was possible for Thompson to make it this far if his resume indeed contained false information. The executive who led the search committee that hired him has said she will be stepping down.
We will keep an eye on this story and bring you any news of interesting updates in the future.
Source: The New York Times DealBook, "Yahoo's Chief Said to Tell Executives He Did Not Submit a Resume," Michael J. De La Merced, May 10, 2012
]]>Luckily for AT&T, the jurisdiction in which this lawsuit takes place has a cap on punitive damages, so it won't pay out anywhere near $5 million. Still, this story should be a wake-up call to Sacramento employers and ought to remind them that they have to be vigilant about what their employees are doing when they are at work.
]]> The woman at the center of this harassment case converted to Islam in 2005. She claims that she was immediately treated differently by her coworkers. She said she was called a "terrorist" and a "towelhead" and that in 2008, her boss tore off her headscarf and exposed her hair, which is against strict Muslim tradition.Now, can you as an employer control everything your employees do when they're on the clock? Of course not. But you do have a responsibility to make sure that if you learn about offensive behavior, you take measures to stop it. Furthermore, you are also expected to have policies, guidelines and training in place to ensure that your employees know they cannot harass others in the workplace. If you do not, you may be liable under the doctrine of respondeat superior, which holds that an employer is responsible for the actions of its employees in certain contexts.
If you are unsure of whether you have taken enough steps to protect yourself from a lawsuit like this one, you may want to talk to an attorney who practices business-related law. He or she can review your existing policies and/or suggest practices you should implement to protect yourself going forward
Source: The Associated Press, "AT&T to pay Muslim woman $5M in harassment case," May 5, 2012
]]>If that move strikes you as unusual (after all, during their business formation stage, how many Sacramento startups dream of the day they can go public?), you might understand it better after we take a closer look at the situation.
]]> There are several reasons why a company that used to be public could choose to go private. One reason that might be appealing to P.F. Chang's is that now that there are no investors to please, it can go ahead and make some decisions that might be unpopular in the short run but may lead to more success in the future. That matters to P.F. Chang's because it has been struggling to compete with "fast-casual" restaurants like Panera Bread and Noodles & Co. and so might need to make some painful changes in order to secure its future.Also, a private company does not have to worry about complying with Securities and Exchange Commission regulations, since it is not selling investments to the public. That can save a company a lot of work, time and hassle.
Of course, the tradeoff to going private is that you lose the ability to make money on the stock market, which can make it hard to raise capital and thus make future projects and endeavors. more difficult.
This post is just a quick introduction to the potential benefits and possible costs of a once-public company going private, but we hope it has at least been a good introduction to the topic. If this interests you, you may want to speak to a business and corporate law attorney more about the matter so you can get further and more detailed information.
Source: Reuters, "PF Change's to go private in $1.1 billion deal," Mihir Dalal, May 1, 2012
]]>While there has been some doubt about whether this is really a trend at all, legislators across the country have reacted swiftly and California is no exception. Our lawmakers in Sacramento are considering a recently introduced bill that would make it illegal for employers to ask for candidates' social media usernames and passwords.
]]> The bill is called The Social Media Privacy Act and was introduced by State Senator Leland Yee of San Francisco. The philosophy behind the bill is that social media accounts offer insight into personal lives that employers do not need or should not know, he said.Michigan, Minnesota, Illinois, Massachusetts, South Carolina, New York and Washington are considering similar bills.
What do you think about this? It is true that most people consider their social media activities private (despite the whole idea that sharing is the raison d'être for social media). However, don't employers have a right to know whom they are hiring?
(Sidenote: As we mentioned, there has been some doubt that there even is a trend of employers asking for social media usernames and passwords. You can read a skeptical take on the whole thing here. Are we getting worked up over nothing?)
Source: The Sacramento Bee, "Job front: Social media privacy bills advance in Sacramento," Darrell Smith, April 30, 2012
]]>How the immediate future unfolds for them could be an important lesson in business planning and crisis strategy that would be good for Sacramento business owners to observe. Even if your business has absolutely nothing to do with the agriculture industry, there is a chance something could happen that could drastically affect your plans and you will need to know how to respond with quickness and agility.
]]> The revelation that a cow from California has mad cow disease may cause the companies that buy dairy products and beef from California farms to want to renege on contracts they had to buy those products, since end customers are bound to get skittish and avoid California-sourced dairy and beef (even if this avoidance is irrational). This puts California farms in a jam; they don't want to just wipe out their contracts, but they don't want to refuse and ruin their relationships with their buyers, either. A good tactic might be to work with a business and corporate law attorney to renegotiate contracts, if possible, to reach a compromise.California dairy and beef enterprises will also probably have to pay for more testing to assure buyers and customers that their products are safe. If your business had an unexpected but necessary expense like this, how would you handle it?
Lastly, there is a strong chance this news could depress the beef and dairy industries for a long time. Do you remember how an E.coli scare really hit the California spinach industry hard about five or so years ago? It took years for spinach farms to recover. You may want to discuss back-up plans with your attorney. Hopefully you won't need to use them, but it is better to have and not need such plans than it is to need and not have them.
Source: The Sacramento Bee, "Mad cow disease found at Central California dairy," Robert Rodriguez, April 25, 2012
]]>Lucky for one Sacramento firm, it does not have to worry about things like that anymore.
]]> The company, SynGen Inc., recently announced that it had received $5 million from a San Francisco venture capital firm. SynGen's founder said he was going to use the money to further develop, then market and seek regulatory approval for SynGen's biggest product, a stem-cell harvesting system.The product can be adapted to harvest cells from many sources, including bone marrow, blood and connective tissue, but it specializes in extracting the cells from umbilical cords. Umbilical cord blood has only recently been established as a potential source for stem cells, so there is some excitement in the industry about SynGen's product.
SynGen's found also established ThermoGenesis in Rancho Cordova, which we have covered on this blog before. That firm also makes the means to harvest and store stem cells -- "archive" them, in the industry parlance. The founder of SynGen formally left ThermoGensis in 2008.
As we said, obtaining financing is an important part of getting your business off the ground. Because you are making financial commitments, it would be a good idea to work with a lawyer so you can have competent advice as you go about making and entering agreements.
Source: The Sacramento Bee, "Sacramento firm gets $5 million for development of stem-cell harvesting systems," Mark Glover, April 19, 2012
]]>Naturally, a business does not want to have to pay more taxes than it must and sometimes uses the fact that it employs so many people to try to negotiate more favorable economic treatment from its base city.
]]> In turn, the city in which it is located does not want to lose a major employer and economic engine, but it does not want the company to become a free rider, either, and holds tight to its position that the business should pay its own way.Keep that delicate balancing act in mind as you consider that Facebook and Menlo Park recently signed an agreement that will allow the social networking giant to bring thousands of employees to the city in exchange for millions given to the city to pay for capital improvements like pedestrian walkways and bike paths.
A Menlo Park official called the agreement "a thoughtful and generous commitment" from Facebook.
If it's true that Facebook and Menlo Park are both happy with the agreement, this is a good example of how a company and the city in which it is located can negotiate with each other and come to a mutually satisfactory decision. Of course, this kind of thing does not happen on its own. Many businesses need the experience of an attorney who understands negotiations to ensure that they are well-represented when talks begin and that their position has a strong advocate.
Source: The Palo Alto Daily News, "Menlo Park council unanimously approves deal for Facebook expansion," Bonnie Eslinger, April 18, 2012
]]>BrightSource Energy, an Oakland-based startup that builds massive solar operations in deserts, recently announced a striking change of course and said it was no longer participating in initial public offering. It made the announcement only hours before it was supposed to debut on the stock market for the first time.
]]> The company claimed that market conditions were not favorable, although one observer also said there was probably a lack of interest on the part of potential stock purchasers since the company has never made a profit. The same analyst also said BrightSource might be hoping it gets acquired by another company. If that's the case, being privately held, rather than publicly traded, might make such an acquisition easier.Another observer noted that since BrightSource has a loan guarantee from the U.S. Department of Energy and the backing of investors like Google and NRG, so strictly speaking it did not need to go public in order to access the capital necessary to continue with its business.
Judging by this decision and by the industry observers' comments, it seems that BrightSource has some big decision in the future and has chosen, in some cases, to make a gamble. Since local businesses are good for the Bay Area economy, we wish them the best going forward and hope that they have smoothed over any legal concerns that might arise with such a turbulent course of business.
Source: The Santa Cruz Sentinel, "BrightSource shelves IPO, walks away from public markets," Dana Hull, April 12, 2012
]]>A Rancho Cordova medical technology firm recently cleared one important business hurdle: approval from Chinese regulators. The firm, ThermoGenesis, can now conduct business in China and, hopefully, can attract a new customer base and grow as an enterprise. For many firms, being able to transact business in China is a very big goal, since it is seen as a promised land of new customers and new markets.
]]> Whether you want to do business in China or not, if you own a business, you are going to have to overcome obstacles including (but not limited to) regulatory approval at some point. As businesses grow and expand, they encounter new issues and often need legal counsel so they can meet them in an appropriate and successful way. Many Sacramento businessmen and women make sure they invest a little time in finding a business or corporate law attorney with whom they work well. It is important to have a trusted advisor on hand when matters get serious and no one has the time, resources or energy to waste on getting caught flat-footed.Source: The Sacramento Bee, "Rancho Cordova firm clears regulatory hurdle in China," Mark Glover, April 11, 2012
]]>Instagram is an app for smartphones that allows user to set filters and stylize pictures, which can then be shared with friends. Facebook is buying Instagram with a combination of cash and Facebook stock which, when Facebook goes public as it is expected to sometime this spring or early summer, will be a hot commodity.
]]> The transaction has the tech sector gossiping because when he announced the acquisition, Facebook CEO Mark Zuckerberg said Facebook would allow Instagram to continue to be its own enterprise. Instagram users will not be required to have a Facebook account to use Instagram and if they do have a Facebook account, they will be allowed to keep their Instagram and Facebook accounts independent of one another if they choose/
That's interesting because until now, Facebook had been making a point to promote Facebook accounts as sort of an online passport; other social media sites like Pinterest require most users to have a Facebook account in order to register or log on.
Obviously, if $1 billion is exchanging hands, this is a pretty big business transaction. But a business deal does not have to have a $1 billion price tag to be important; surely, Sacramento business leaders have closed vital deals that cost much less than that. Regardless of whether the transaction is worth $1 billion or $10,000, the advice and counsel of an experienced business and corporate law can be helpful.
Source: The New York Times Deal Book, "Facebook Buys Instagram for $1 Billion," Evelyn M. Rusli, April 9, 2012
]]>As you can see, then the spending associated with the Kings can prompt business formation and that is one reason why some have eagerly been anticipating the development of a new arena for the Kings in downtown Sacramento.
]]> The $391 million development could go a long way toward revitalizing downtown and would be good for businesses if it could attract new shoppers, diners and pedestrians.However, the owners of the Kings and the Sacramento City Council are currently at odds as to whom should pay the starting costs to get going on the $391 million project. Such issues are not at all uncommon on these public-private hybrids because neither side wants to wind up the deal by paying more and looking like a sucker.
The dispute over the new stadium will be addressed at a meeting of NBA commissioners in New York in two weeks. It would be nice if the two sides could come to an agreement by then, but then again, deals like this cannot be rushed. When money and commitments are at stake, it often pays to be deliberate and carefully and have every step reviewed and approved by an attorney. Yes, it takes longer, but oftentimes it can save you from making a very big mistake.
Source: The Sacramento Bee, "Sacramento City Council OKS environmental, site plan work for arena," Ryan Lillis and Tony Bizjak, April 4, 2012
]]>OMGPOP was an appealing acquisition target thanks in large part to its most popular app, the game Draw Something. The app, which is sort of like a digital version of Pictionary, has been one of the most popular among smartphone users for many months; it's currently the top-downloaded app for both iPhones and Android phones in 84 countries.
]]> However, analysts are scratching their heads over the deal.First, OMGPOP is not very established as a company. Its business model is unproven and it is has produced only one hit (albeit a very successful hit). That has led some people to question whether the $200 million price was excessive. Industry observers have said it might have been better to either pay less for OMGPOP or to wait until it had a better track record.
Then again, waiting might have meant a rival could have snapped up OMGPOP before Zynga had the chance. That's the sort of tradeoff business owners must make when they are thinking about acquiring a potential competitor. These acquisitions must be thought over and considered very carefully and are very important piece of an overall business strategy. That's why many business owners around the Bay Area making finding a business and corporate law attorney they can trust a real priority; having an ally you can count on can really make a lot of difference.
Source: Reuters, "Zynga buys OMGPOP for $200 million," Liana B. Baker and Sarah McBride, March 21, 2012
]]>"Weaponizing" a patent means that the patent-holder rushed to patent something, perhaps before the subject of the patent is even completed, so that it could later use the patent to sue a competitor who is working on similar technology. The practice has attracted some criticism because that is not a traditional use or intent behind patents.
]]> This allegation of weaponization came from a former Yahoo employee. Yahoo encouraged its employees to patent anything and everything they could, this former employee said, even if the time wasn't quite ripe development-wises and the filing was vague. This former employee now claims that Yahoo is using some of these unclear, claim-jumping patents to "extort" money from Facebook; he used the term "extort" because Facebook is about to go public and naturally wants to avoid the bad publicity associated with a lawsuit.Keep in mind that this is all coming from a former employee. We have no insight as to why this former employee is no longer with the company, but it is possible that he left on bad terms and is acting out of spite. That being said, if the former employee's claims are true, it is a good example of how business owners must be prepared to confront issues on all fronts. There are a multitude of legal issues that confront any business and it often takes the assistance of a careful and experienced attorney to address these issues properly.
Source: The Telegraph, "Yahoo 'weaponising' patents to take on Facebook," Matt Warman, March 14, 2012
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