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California Business, Insurance And Environmental Law Blog

Comic book merger could lead to new approaches

Many California businesses seek to improve and expand their market strength and offerings through mergers and acquisitions. The same is true of creative companies like comic book publishers. Two interesting comics publishers have announced their merger, bringing together the producers of "Comics for Everyone" and "Rick & Morty" into one new publishing firm. Oni Press is merging with Lion Forge Comics to create a larger independent house that competes with the major players in the comics market like Marvel and DC.

The merger comes as an increasing number of traditional book publishers are also entering the comics arena by publishing graphic novels. According to statistics measuring sales of graphic novels and comic books, traditional bookstores and online sites like Amazon and Barnes & Noble are selling far more comics than specialty stores and website. Oni Comics specializes in marketing non-superhero comics, including mysteries, romances and graphic novels. It was responsible for producing the "Scott Pilgrim" comic series that led to a major Hollywood film.

Sam Adams and Dogfish Head brewers set to merge

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.

Is your insurer denying an environmental claim in bad faith?

There are many different risks that come with operating a business. Some you can mitigate and control through careful business practices, but others you have very little power over, like the weather.

Thankfully, for just about any issue that could arise in business, there is insurance coverage available. Most businesses with a physical location have liability and premises insurance policies that protect them in case someone gets hurt on their property. There are workers' compensation insurance programs to protect you from injury claims from employees. There are also environmental insurance policies available for businesses.

Tax prep companies accused of defrauding tax filers

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.

What to know about starting a new company

Many people in California and throughout the country have thought about the possibility of leaving their jobs in favor of starting their own companies. However, it is important to have a plan prior to making the transition from employee to employer. The first step in the process is to do as much research as possible into the product or service that the company will offer. Furthermore, it is a good idea to understand who the competition is and who the company's target customer will be.

This should all be spelled out in the company's business plan. The business plan should also look at the sales and marketing strategies that the organization will use to attract customers. In many cases, a new company will need financing to help it grow into a profitable enterprise, and it is important to know where that money will come from.

McGraw-Hill Education and Cengage Learning plan to merge

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.

Mobile phone merger reveals deeper problems

Many California companies look at mergers and acquisitions as an important way to enhance or expand their business portfolios. However, publicly traded companies or firms in certain industries may find that government regulations could stymie their plans to merge. Two national wireless carriers, Sprint and T-Mobile, are facing obstacles that could derail their planned transaction.

The companies are seeking approval for their merger from the Federal Communications Commission. Sprint, in particular, said in its filings to the agency that it may not be able to remain in business if the merger plans are rejected. The company, the fourth-largest mobile carrier in the country, said that it does not have a viable or sustainable path to compete with other firms. While Sprint and T-Mobile concluded negotiations for their deal in April 2018, the plan has been plagued by lingering questions about whether it would meet with federal approval. Sprint offers the lowest prices of the major carriers, and some have noted that the merger could lead to less competition in the wireless market.

Companies spending more to defend class action lawsuits

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.

Opponents of CVS acquisition of Aetna to speak in court

California residents who follow the medical sector are probably aware that the retail pharmacy chain CVS Health Corp. is in the process of acquiring the managed health care company Aetna Inc. in a deal reported to be worth almost $70 billion. Attorneys for the two companies closed the deal in November 2018 and the U.S. Department of Justice approved the acquisition providing the two companies sold certain assets. Most analysts expected the acquisition process to be completed quickly following the DOJ decision, but hopes of a speedy resolution were dashed on April 5 when a federal judge announced that he would be holding hearings to allow those with concerns about the deal to be heard.

The provisions of the 1974 Antitrust Procedures and Penalties Act, which is more widely known as the Tunney Act, require the federal government to obtain court approval for certain mergers and acquisitions, but these approvals are generally a formality and hearings are extremely rare. After learning about the judge's decision, a CVS attorney remarked that calling witnesses to testify about a merger settlement approved by the DOJ would be a legal first.

Act effectively if vendor drops the ball

Your brick-and-mortar business depends on reliable deliveries from vendors to meet customers' demands. But your supply chain could be vulnerable to any number of situations that could affect your bottom line — strikes and work stoppages, natural disasters, accidents, recalls and simple incompetence.

Your goal is naturally to get things up and running once again with the least possible down-time. Below are some suggestions to recoup your losses with the fewest possible problems.

Contact us now to begin a confidential case evaluation:

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