California Business, Insurance And Environmental Law Blog

Craft-brewed beers have become extremely popular in California and around the country in the last two decades, and independent breweries that were once struggling are now extremely successful. The Boston Beer Company, which is best known for its Samuel Adams line of beers, has long been one of the leaders in the craft-brewed sector, but smaller local companies like the Dogfish Head Craft Brewery have been taking a larger share of the market in recent years.

On May 9, The Boston Beer Company announced that it had signed a definitive merger agreement with the Dogfish Head Craft Brewery. In a press release, the company said that the merger would create a brewer with the resources and experience needed to do battle with multinational beer conglomerates. According to industry sources, the founder of the Dogfish Head Craft Brewery will receive more than 400,000 BBC shares under the terms of the deal. The shares have been trading for more than $300 each in recent weeks. The Delaware-based craft brewer's shareholders will be paid $173 million in cash.

Two leading tax preparation companies that many California taxpayers routinely turn to for their annual tax-filing needs, Intuit-owned TurboTax and H&R Block, have been accused of deceptive business practices. This is according to two separate lawsuits filed in early May of 2019. Both companies are accused of violating the state's unfair competition law.

Each company provides access to software designed to help tax-filers prepare their state and federal returns online. The complaints involve the companies' free filing options. Under an agreement with the Internal Revenue Service, both tax prep companies agreed to make a free version of their software available to individuals earning less than $66,000 a year. The Los Angeles attorney pursuing action against Intuit claims that the company lures low-income customers to a low-quality free version of its software that is essentially useless unless filers have simple returns. The company also prevents references to its free edition from showing up on search engine results pages.

Californians who follow business news might be interested in learning about a merger that was recently announced between McGraw-Hill Education and Cengage Learning Holdings II, two large educational publishers. The companies announced that they will merge together in an all-stock deal to create the second-largest publisher of educational materials in the U.S.

Current holders of the two companies will each keep 50% of the new company. The merged company will be named McGraw Hill, and it is projected to have $3.16 billion in annual revenue. It is valued at $5 billion. The companies stated that the merger will allow them to save $300 million in costs over the next three years. They plan to use that money to expand the digital presence of McGraw Hill.

Businesses in California and across the country are paying more to defend themselves from class action lawsuits, even though there are fewer such cases than in the past. In many cases, the issues involved are often complex and expert-heavy. Between 2010 and 2014, companies spent decreasing amounts to defend themselves in these types of cases. However, from 2014 to 2018, spending has steadily increased once again, reaching $2.46 billion in legal costs in 2018.

Fewer businesses reported facing these types of class action lawsuits in 2018, but those companies that did report cases had more to worry about. The average number of litigation matters addressed by each company rose to 7.8 from an average of 6.3 one year earlier. The information was derived from a survey of 395 legal officers or general counsel at Fortune 1000 and other large companies with average annual revenues of $14.8 billion. Class action lawsuits may address a wide range of issues but the most common ones involve wage and hour issues or other employment law concerns. These cases consumed 26.1 percent of total spending and accounted for 28.7 percent of all of the cases.