After a ruling by a federal judge in Florida, Harry Reid Airport and several airlines lifted their mask mandates. ]RJ; Nevada Current]
Here’s another quick look on whether a 9th Circuit judge selecting her replacement presents an optics problem. [ABA Journal]
A public defender will be assigned to an assembly candidate accused of bank robbery. [RJ]
@LasVegasLocally tweeted about explosive allegations made against a casino executive in a deposition related to a bankruptcy case. Anyone have more details?
Any tips for dealing with allergies on this windy,, spring day?
I posted who local media identified as the subject of the LasVegasLocally tweet and it was taken down. I understand the reticence in such situations and that this is not my Blog; however perhaps the invitation "Anyone have more details?" should be deleted if "more details" are just going to be taken down.
Different topic: I read the articles about Elon Musk and Twitter adopting a "poison pill." I even Googled "poison pill" and do not understand it (forgive me, I'm a lowly divorce lawyer). If anyone is really bored and cares to post – what does that mean in simple terms?
Essentially, they plan to offer a sale on the cost of shares to flood the market if Musk ends up owning 15% or more of Twitter's stock. If that 15% is triggered, shareholders can buy stock at the discount rate, to then dilute Musk's share.
There's a fascinating history of the rise of hostile takeovers, which led to the creation by Martin Lipton (of Wachtell Lipton) of poison pills to combat hostile takeovers. Poison pills are measures taken by a corporation's board that are intended to make it more difficult or impossible for a party to obtain majority control of the corporation without the board's approval. Wikipedia: https://en.wikipedia.org/wiki/Shareholder_rights_plan
So, ownership in a publicly traded company is via shares of stock. Musk is trying to buy up enough shares to control the company. So, the Board of Directors adopts a poison pill resolution to stop it, essentially, to destroy Musk's shares value if he tries to take over the company. The reasoning is that if he is going to buy enough shares to take control of the company, he should pay a much larger premium than just what the shares are currently trading at (or a little bit more). The value of controlling the company is worth more than the price of the shares of stock themselves (makes sense right? If you have enough shares of stock to control Twitter, that's *worth* more than just the price of the stock).
The poison pill here is triggered if any single shareholder owns 15% of the stock. Musk has 9%. What happens is it lets each other shareholder (except for Musk, or whoever owns 15%) purchase additional shares with voting rights that are worth $420 (yes) for $210.
So, what happens if Musk proceeds? He buys up enough shares to get 15%. Then the poison pill is triggered. Shareholders can buy up a ton of these new voting shares for half off, and now there's a TON more voting shares out there, so Musk has to spend even more to buy up enough shares to have a controlling stake.
TL;DR – Poison pill triggers if someone tries to buy too many shares, permits other shareholders to buy more shares at a discount, which makes the takeover attempt by Musk prohibitively expensive because of all the new shares.
The reason you don't understand it, 9:54 AM, is because the reporters on the story don't understand it. This is an increasing problem with news coverage. I see similar problems with coverage of the war in Ukraine. I often have questions that have no answer in the coverage I read. I am not a conservative with a victim complex whining about liberal bias in media. I am complaining that reporters often do not have the time or resources to fully understand and explain what they report on and it shows.
Thank you, 10:13 AM. That is the most clear and concise explanation I've read.
Following up – would the Board be potentially subject to a class action from the shareholders for failing its fiduciary duty by not accepting Musk's inflated offer (which apparently a lot more than 50% of the twitter shareholders wanted to accept), and by acting in self-interest or political interest rather than what's best for the shareholders?
I don't practice this sort of law, but it seems to me that if someone brings you a bona fide offer that exceeds the current evaluation of your company, it shouldn't matter to you that you don't agree with that person politically. What is in the best interest of the company?
The company was rated as a Sell. It loses revenue and has been since 2020 – some refer to it as a death spiral.
Musk is over $43 billion – 3 times more than its worth. I think the politically motivated board that owns very little of Twitter is not acting in the best interest of the company by fighting Musk.
But thats my personal opinion – and obviously only for discussion purposes.
10:52 – I guess you have to define the fiduciary responsibility of the board. Is it literally to just maximize the value of the share right now? Is it to maximize the value of the company? What if Musk wants to buy the company and then dissolve it – what's the fiduciary duty then?
There's ways around the poison pill too – he could get enough proxy votes to overcome it.
Good question. I don't know from a legal perspective. I would guess that if Musk wanted to buy the company and then shut it down or whatever, but was willing to pay 3 times the share price for the privilege – it would be in the best interest of the shareholders…but nobody has a crystal ball.
The fact is – you and I both know that the poison pill and all this fighting from the board is motivated nearly entirely by politics. The board members (from what I understand) do not own a lot of the company stock, they are paid large salaries and are afraid that Musk will do good on his promise to reduce their compensation to $0. He is setting them up to look like all they care about is their self interest and not whats best for the company.
I still think plenty of lawsuits from the shareholders are coming at the board soon.
See. Look at that. Its possible to have a rational discussion about a hot topic that intersects with politics without it devolving into name calling and childish partisan bickering. Well done everyone.
Yes the board have a fiduciary duty and could be subject to a lawsuit, but the reasonableness of declining Musk's offer and adopting the poison pill is more a financial question than a legal question. When Musk made his offer, all of the finance analysis I read said it was too low to be serious. A buyer has to pay a big "control premium," which this offer doesn't represent, the offer was well below Twitter's 52 week high and Musk's financing isn't rock solid. I have no idea if this analysis is right, but that's what the experts are saying.
I think the argument that the board is rejecting his offer because they'll lose their salary is incredibly tenuous. I would bet that every Twitter board member is on at least one other BoD, they have all been successful professionally, and are worth at least 50M (and some are probably worth billions).
Musk is also incredibly volatile and will cause massive headaches for any board of directors. How many times has he been fined/sanctioned by the SEC? Anyone remember "funding secured!"? Can't just take him at face value.
Ok, but… Parag Agrawal has an estimated net worth of about $1.52 million (not that its nothing, but I bet taking a hit on Twitter BoD would hurt a lot).
His annual compensation on BoD of Twitter is $1 million (first time he broke into 7 figure club) with 12 million a year in stock options that are restricted.
It is also my understanding that he is not currently on any other Board of Directors.
Now, having said that, I am sure there are wealthy people that sit on the BoD of Twitter. That is not the point. The point is to make them LOOK like they are self-dealing and self-interested, regardless of whether they are – the defense is "I am already very wealthy so who cares if I get nothing from Twitter" is not going to go over well in front of a jury.
Musk is volatile, but we all know his money is good. Twitter is a dying brand in desperate need of a revamp. Say what you will, but the platform that kicked off Babylon Bee and Trump, but allows Putin and Ayatollah Khomeini on has serious credibility issues as to how they go about enforcing their ToUs.
Guest
Anonymous
April 19, 2022 6:17 pm
Use a combination of Allegra-D and Flonase.
Guest
Anonymous
April 19, 2022 7:05 pm
I've lost so much respect for Judge Rawlinson with her choosing her successor. I question why she thought it was a good idea to be so public about it? I guess it's better than her doing it sneakily behind the scenes. Maybe I always respected her because by all accounts she seemed to be a good judge, and this reeks of politics, which federal judges should be above. Sad.
Guest
Anonymous
April 19, 2022 8:07 pm
The first 2 topics represent a real problem in our judiciary. Political comments tend to get deleted, but here goes…
Federal judges aren't being selected on merit or intellect or experience…they're being selected on ideology. The FL judge was rated unqualified by the ABA. She's basically a child and now she's got a life long appointment to the federal bench. Politicians and activists can go forum shopping and select districts where they're more likely to get these kinds of judges who issue unfounded orders based on politics and their personal opinions rather than facts and law.
This has created a situation like the judge in the 9th not wanting to step down, even though she is obviously ready for retirement, unless she gets a say in who is going to replace her. She doesn't get a say – she's done. There's an established process for replacing judges and it doesn't involve judges picking their successor. In this political climate though, I can see why a judge would be scared to leave their seat open and subject to the political whims that led to that unqualified hack in FL ending up with a life time appointment.
With the current political climate, Judge Rawlinson's successor is all but certain to be a radical left-wing nut job. So, I don't understand why she was so specific to name Aaron Ford's wife.
Clearly posted by someone who did not deign to read the 59 page well-reasoned INARGUABLE decision that the CDC did not follow the law in issuing the mask mandate.
Unfortunately, posters to this blog are not vetted by their qualifications, intellect or experience but by their political bent. I hope you dont get your post nuked for its brazen political angle.
Guest
Anonymous
April 19, 2022 9:05 pm
Super unrelated question for anyone who might know. Is NRS 201.180 enforced ever for marriage between cousins? This is common practice in some parts of the world and I am curious if for example, representing an individual married to a cousin in family law proceedings there would be any risk of client getting criminal penalties
If you are 'common law married' in a state that recognizes it, and you move to a state that doesn't, the new state may not recognize it unless you've formalized it prior to moving to that state. In Texas, for example (one state that does recognize common law marriage), the couple has to file a document to register their "informal marriage" with the county where they live before moving to Nevada if they want Nevada to recognize it.
I ran into that problem with a client before (~10 years ago.) Nevada wouldn't recognize her unregistered common law marriage with her husband of ~30 years after they moved to Las Vegas and the husband died about 5 years later. We attempted to probate his estate (no Will existed) against the opposition of his only surviving sibling (no kids of the marriage) and the sibling ended up with everything.
I'm not saying Nevada wouldn't recognize a legitimately documented California state first-cousin marriage, but before DOMA was struck down, Nevada refused to acknowledge same-sex marriage from states that didn't prohibit them, so there is precedence for not recognizing marriages that are deemed illegal in Nevada.
I had a case in which the parties were married in a foreign jurisdiction and they were related such that their marriage would not be legal or recognized in Nevada. They had been married for some time and one of the parties attempted to use their degree of consanguinity as a reason to declare the marriage void. The court refused to entertain the argument. The marriage was recognized and they had to go through a divorce with all the bells and whistles just like non-relatives would have to. There was no mention of criminal sanctions or even a referral to the DA.
If there is nothing suggesting undue influence, a huge age disparity, or some other power differential, I think you'd be okay.
That tweet had a reply tweet from Dana Gentry that has since been deleted, but I believe this has to do with this article she posted. https://www.nevadacurrent.com/blog/gaming-chair-wants-more-intel-on-barry-diller/
I posted who local media identified as the subject of the LasVegasLocally tweet and it was taken down. I understand the reticence in such situations and that this is not my Blog; however perhaps the invitation "Anyone have more details?" should be deleted if "more details" are just going to be taken down.
How about we just let John L. Smith explain? https://thenevadaindependent.com/article/embattled-gambler-lets-fly-with-accusations-against-resorts-world-president
Different topic: I read the articles about Elon Musk and Twitter adopting a "poison pill." I even Googled "poison pill" and do not understand it (forgive me, I'm a lowly divorce lawyer). If anyone is really bored and cares to post – what does that mean in simple terms?
Essentially, they plan to offer a sale on the cost of shares to flood the market if Musk ends up owning 15% or more of Twitter's stock. If that 15% is triggered, shareholders can buy stock at the discount rate, to then dilute Musk's share.
It means to short Twitter
There's a fascinating history of the rise of hostile takeovers, which led to the creation by Martin Lipton (of Wachtell Lipton) of poison pills to combat hostile takeovers. Poison pills are measures taken by a corporation's board that are intended to make it more difficult or impossible for a party to obtain majority control of the corporation without the board's approval. Wikipedia: https://en.wikipedia.org/wiki/Shareholder_rights_plan
9:54 – here's my attempt
So, ownership in a publicly traded company is via shares of stock. Musk is trying to buy up enough shares to control the company. So, the Board of Directors adopts a poison pill resolution to stop it, essentially, to destroy Musk's shares value if he tries to take over the company. The reasoning is that if he is going to buy enough shares to take control of the company, he should pay a much larger premium than just what the shares are currently trading at (or a little bit more). The value of controlling the company is worth more than the price of the shares of stock themselves (makes sense right? If you have enough shares of stock to control Twitter, that's *worth* more than just the price of the stock).
The poison pill here is triggered if any single shareholder owns 15% of the stock. Musk has 9%. What happens is it lets each other shareholder (except for Musk, or whoever owns 15%) purchase additional shares with voting rights that are worth $420 (yes) for $210.
So, what happens if Musk proceeds? He buys up enough shares to get 15%. Then the poison pill is triggered. Shareholders can buy up a ton of these new voting shares for half off, and now there's a TON more voting shares out there, so Musk has to spend even more to buy up enough shares to have a controlling stake.
TL;DR – Poison pill triggers if someone tries to buy too many shares, permits other shareholders to buy more shares at a discount, which makes the takeover attempt by Musk prohibitively expensive because of all the new shares.
Shoutout to my securities reg professor
The reason you don't understand it, 9:54 AM, is because the reporters on the story don't understand it. This is an increasing problem with news coverage. I see similar problems with coverage of the war in Ukraine. I often have questions that have no answer in the coverage I read. I am not a conservative with a victim complex whining about liberal bias in media. I am complaining that reporters often do not have the time or resources to fully understand and explain what they report on and it shows.
Thank you, 10:13 AM. That is the most clear and concise explanation I've read.
OP back – thanks to all for serious, insightful answers!
10:25 – serious offer, if you have questions about Ukraine, feel free to ask me. I am of Ukrainian descent. we can message offline if you wish.
Thanks for the offer 12:11. Your email still anonymous@anonymousukranian.edu? Alrighty then.
12:11 Robert@canonlaw.us
Following up – would the Board be potentially subject to a class action from the shareholders for failing its fiduciary duty by not accepting Musk's inflated offer (which apparently a lot more than 50% of the twitter shareholders wanted to accept), and by acting in self-interest or political interest rather than what's best for the shareholders?
I don't practice this sort of law, but it seems to me that if someone brings you a bona fide offer that exceeds the current evaluation of your company, it shouldn't matter to you that you don't agree with that person politically. What is in the best interest of the company?
The company was rated as a Sell. It loses revenue and has been since 2020 – some refer to it as a death spiral.
The current value of Twitter is $13.1 billion.
https://www.gobankingrates.com/money/business/how-much-is-twitter-worth/
Musk is over $43 billion – 3 times more than its worth. I think the politically motivated board that owns very little of Twitter is not acting in the best interest of the company by fighting Musk.
But thats my personal opinion – and obviously only for discussion purposes.
10:52 – I guess you have to define the fiduciary responsibility of the board. Is it literally to just maximize the value of the share right now? Is it to maximize the value of the company? What if Musk wants to buy the company and then dissolve it – what's the fiduciary duty then?
There's ways around the poison pill too – he could get enough proxy votes to overcome it.
Good question. I don't know from a legal perspective. I would guess that if Musk wanted to buy the company and then shut it down or whatever, but was willing to pay 3 times the share price for the privilege – it would be in the best interest of the shareholders…but nobody has a crystal ball.
The fact is – you and I both know that the poison pill and all this fighting from the board is motivated nearly entirely by politics. The board members (from what I understand) do not own a lot of the company stock, they are paid large salaries and are afraid that Musk will do good on his promise to reduce their compensation to $0. He is setting them up to look like all they care about is their self interest and not whats best for the company.
I still think plenty of lawsuits from the shareholders are coming at the board soon.
See. Look at that. Its possible to have a rational discussion about a hot topic that intersects with politics without it devolving into name calling and childish partisan bickering. Well done everyone.
Yes the board have a fiduciary duty and could be subject to a lawsuit, but the reasonableness of declining Musk's offer and adopting the poison pill is more a financial question than a legal question. When Musk made his offer, all of the finance analysis I read said it was too low to be serious. A buyer has to pay a big "control premium," which this offer doesn't represent, the offer was well below Twitter's 52 week high and Musk's financing isn't rock solid. I have no idea if this analysis is right, but that's what the experts are saying.
11:50 that is the comment of the decade. Thank you, thank you and thank you!
I think the argument that the board is rejecting his offer because they'll lose their salary is incredibly tenuous. I would bet that every Twitter board member is on at least one other BoD, they have all been successful professionally, and are worth at least 50M (and some are probably worth billions).
Musk is also incredibly volatile and will cause massive headaches for any board of directors. How many times has he been fined/sanctioned by the SEC? Anyone remember "funding secured!"? Can't just take him at face value.
Ok, but… Parag Agrawal has an estimated net worth of about $1.52 million (not that its nothing, but I bet taking a hit on Twitter BoD would hurt a lot).
https://www.the-sun.com/tech/4168112/twitter-ceo-parag-agrawal-net-worth/
His annual compensation on BoD of Twitter is $1 million (first time he broke into 7 figure club) with 12 million a year in stock options that are restricted.
It is also my understanding that he is not currently on any other Board of Directors.
Now, having said that, I am sure there are wealthy people that sit on the BoD of Twitter. That is not the point. The point is to make them LOOK like they are self-dealing and self-interested, regardless of whether they are – the defense is "I am already very wealthy so who cares if I get nothing from Twitter" is not going to go over well in front of a jury.
Musk is volatile, but we all know his money is good. Twitter is a dying brand in desperate need of a revamp. Say what you will, but the platform that kicked off Babylon Bee and Trump, but allows Putin and Ayatollah Khomeini on has serious credibility issues as to how they go about enforcing their ToUs.
Use a combination of Allegra-D and Flonase.
I've lost so much respect for Judge Rawlinson with her choosing her successor. I question why she thought it was a good idea to be so public about it? I guess it's better than her doing it sneakily behind the scenes. Maybe I always respected her because by all accounts she seemed to be a good judge, and this reeks of politics, which federal judges should be above. Sad.
The first 2 topics represent a real problem in our judiciary. Political comments tend to get deleted, but here goes…
Federal judges aren't being selected on merit or intellect or experience…they're being selected on ideology. The FL judge was rated unqualified by the ABA. She's basically a child and now she's got a life long appointment to the federal bench. Politicians and activists can go forum shopping and select districts where they're more likely to get these kinds of judges who issue unfounded orders based on politics and their personal opinions rather than facts and law.
This has created a situation like the judge in the 9th not wanting to step down, even though she is obviously ready for retirement, unless she gets a say in who is going to replace her. She doesn't get a say – she's done. There's an established process for replacing judges and it doesn't involve judges picking their successor. In this political climate though, I can see why a judge would be scared to leave their seat open and subject to the political whims that led to that unqualified hack in FL ending up with a life time appointment.
With the current political climate, Judge Rawlinson's successor is all but certain to be a radical left-wing nut job. So, I don't understand why she was so specific to name Aaron Ford's wife.
Clearly posted by someone who did not deign to read the 59 page well-reasoned INARGUABLE decision that the CDC did not follow the law in issuing the mask mandate.
Unfortunately, posters to this blog are not vetted by their qualifications, intellect or experience but by their political bent. I hope you dont get your post nuked for its brazen political angle.
Super unrelated question for anyone who might know. Is NRS 201.180 enforced ever for marriage between cousins? This is common practice in some parts of the world and I am curious if for example, representing an individual married to a cousin in family law proceedings there would be any risk of client getting criminal penalties
Just tell your cousins to move to California – it's legal there.
I would think that if it was legal in the state where they were married (as in CA apparently), they get FF&C under the US Constitution.
If you are 'common law married' in a state that recognizes it, and you move to a state that doesn't, the new state may not recognize it unless you've formalized it prior to moving to that state. In Texas, for example (one state that does recognize common law marriage), the couple has to file a document to register their "informal marriage" with the county where they live before moving to Nevada if they want Nevada to recognize it.
I ran into that problem with a client before (~10 years ago.) Nevada wouldn't recognize her unregistered common law marriage with her husband of ~30 years after they moved to Las Vegas and the husband died about 5 years later. We attempted to probate his estate (no Will existed) against the opposition of his only surviving sibling (no kids of the marriage) and the sibling ended up with everything.
I'm not saying Nevada wouldn't recognize a legitimately documented California state first-cousin marriage, but before DOMA was struck down, Nevada refused to acknowledge same-sex marriage from states that didn't prohibit them, so there is precedence for not recognizing marriages that are deemed illegal in Nevada.
I had a case in which the parties were married in a foreign jurisdiction and they were related such that their marriage would not be legal or recognized in Nevada. They had been married for some time and one of the parties attempted to use their degree of consanguinity as a reason to declare the marriage void. The court refused to entertain the argument. The marriage was recognized and they had to go through a divorce with all the bells and whistles just like non-relatives would have to. There was no mention of criminal sanctions or even a referral to the DA.
If there is nothing suggesting undue influence, a huge age disparity, or some other power differential, I think you'd be okay.
Thank you everyone, especially 7:59, you just described basically the exact situation I am dealing with!
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Come in, 919. It is a joke