BILL NUMBER: AB 1255	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Pan

                        FEBRUARY 22, 2013

   An act to amend Section 25502.5 of the Corporations Code, relating
to corporations.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1255, as introduced, Pan. Corporations.
   The Corporate Securities Law of 1968 provides for the regulation
of the issuance of corporate securities and includes a civil remedy
for specified issuers of securities for a specified violation of its
provisions.
   This bill would make technical, nonsubstantive changes to this
provision.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 25502.5 of the Corporations Code is amended to
read:
   25502.5.  (a)  Any   A  person  ,
 other than the issuer  ,  who violates Section 25402
shall be liable to the issuer of the security purchased or sold in
violation of Section 25402 for damages in an amount up to three times
the difference between the price at which the security was purchased
or sold and the market value which the security would have had at
the time of the purchase or sale if the information known to the
defendant had been publicly disseminated prior to that time and a
reasonable time had elapsed for the market to absorb the information
and shall be liable to the issuer of the security or to a person who
institutes an action under this section in the right of the issuer of
the security for reasonable costs and attorney's fees.
   (b) The amounts recoverable under this section by the issuer shall
be reduced by any amount paid by the defendant in a proceeding
brought by the Securities and Exchange Commission with respect to the
same transaction or transactions under the federal Insider Trading
Sanctions Act of 1984 (15 U.S.C. Secs. 78a, 78c, 78o, 78t, 78u, and
78ff) or any other  act  act,  regardless
of whether the amount was paid pursuant to a judgment or settlement
or paid before or after the filing of an action by the plaintiff
against the defendant. If a proceeding has been commenced by the
Securities and Exchange  Commission  
Commission,  but has not been finally resolved, the court shall
delay entering a judgment for the plaintiff under this section until
that proceeding is resolved.
   (c) If any shareholder of an issuer alleges to the board that
there has been a violation of this section, the board shall 
be required to  consider the allegation in good faith, and
if the allegation involves misconduct by any director, that director
shall not be entitled to vote on any matter involving the allegation.
However, that director may be counted in determining the presence of
a quorum at a meeting of the board or a committee of the board.
   (d) This section shall only apply to issuers who have total assets
in excess of one million dollars ($1,000,000) and have a class of
equity security held of record by 500 or more persons.