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Irvine CA Business & Commercial Law Blog

Failed auto company reaches settlement over unsecured debts

Anaheim-based luxury car manufacturer Fisker Automotive Holdings Inc. reportedly reached a settlement agreement regarding its unsecured creditors in an ongoing bankruptcy case. As readers may know, Fisker filed for Chapter 11 bankruptcy last November. Prior to the filing, rival company Hybrid Technology LLC agreed to purchase a defaulted government loan Fisker benefitted from. Fisker subsequently agreed to be acquired by Hybrid Technology. Hybrid will not ultimately be taking control of Fisker’s assets, though. That will be the benefit of Wanxiang Group Corp, a Chinese company which outbid Hybrid in February after being brought into the process.

Still, the recent settlement agreement is good news for Hybrid Technology, which could receive up to $90 million from Fisker’s sale of assets. That is nearly four times what the company paid to take over Fisker’s defaulted loan. 

Confirmed: Apple acquired speech-recognition company last year

Apple, a company known for its innovative spirit, is currently engaged in a battle with Microsoft and Google over who can come up with a top pick personal assistant app. This technology, as many of our readers know, relies heavily on accurate speech-recognition technology. Although it wasn’t confirmed this month, Apple acquired a company last year that may help it to be more competitive in this area.

Novauris, a UK-based company that was founded 12 years ago, dedicated itself for over 10 years to developing accurate speech-recognition technology. The company specialized in providing on-device services, but it isn’t known what role the company’s speech-recognition technology will play in future developments of Apple’s Siri app.  

State education standards attract venture capitalists

Venture capital is an exciting business in which investors are able to thrown in and take their chances with startup companies offering promising new products and services. Industries such as biotechnology and information technology are commonly targeted by venture capitalists. It is somewhat surprising, then, that there is a growing market for venture capital among startups and established companies to provide learning materials to help public schools meet state-established core standards in English and mathematics.

California is among the majority of states who have adopted such standards. Because of the importance of these academic achievement measurements, there has been a lot of interest around developing education technology to help schools meet those standards. In California, the state has estimated that actually implementing its standards will cost around $3 billion. This is enough to attract enterprising companies.  

Two lawsuits filed against GM this week

Readers know that General Motors is currently going through legal trouble surrounding the recall of 1.6 million vehicles for a defect in the ignition switch of certain models. Most of the models recalled were the 2005 to 2007 Chevrolet Cobalt and the Saturn Ion between 2003 and 2007. Last time we wrote about how the company’s 2009 bankruptcy may affect its liability. Here we’ll focus a bit more on the current litigation.

In addition to a suit seeking class action status, there is a wrongful death lawsuit filed in Alabama by a former employee of the company that sold ignition switches to GM and the father of a girl killed in an accident caused by such an ignition switch. Both lawsuits have in common that they say GM was aware of issues with the ignition switch problem as far back as 2001 but didn’t take steps to fully address the problem. 

GM faces litigation over bankruptcy fraud

Bankruptcy can be an opportunity for a business to get its affairs in order and really reorganize so as to be more successful in the future. To achieve that result, though, a bankrupt business needs to completely cooperate with the process and be mindful of the laws governing bankruptcy. The consequences of failing to do so can be serious.

One example of this is the current legal troubles faced by General Motors, which was hit by a lawsuit earlier this week alleging that the company committed fraud by hiding the extent of its liabilities prior to a 2009 bankruptcy filing. The liabilities are connected to problems with ignition switches in 1.6 million vehicles. Plaintiffs say that the company was supposed to report safety issues relating to pre-bankruptcy vehicles to the federal government, but that it failed to do so. 

Proposed merger of Comcast, Time Warner Cable could face challenges

Readers may have heard of the proposed merger of Comcast with Time Warner Cable. The proposal, which was announced last month, would be a big boost to Comcast, which would afterward have a presence in 19 of the 20 largest television markets nationwide. Almost immediately after the merger was proposed, industry experts suggested that the deal could be scrutinized heavily by federal regulators since it is so big and could affect so many consumers. If Comcast gets the deal, it could end up with major influence over advertisers and content providers.

The federal agencies responsible for handling any problems with the merger are the Department of Justice and the Federal Communications Commission. Whether or not there are going to be any issues with the deal remains to be seen, but Comcast seemed fairly confident last month that there would be no issues. 

Shellfish business faces lawsuit over discharge practices

When a California company is faced with a lawsuit, it is very important to tackle it head on. Even before a dispute reaches litigation, it can have a negative effect on the vitality of a company. In many cases, it is better to tackle the situation with the help of a strong defense team than to ignore the issue.

Take for example a company called Drakes Bay Oyster Company that works in the Point Reyes National Seashore in northern California. Early last year the California Coastal Commission cited the company because they didn’t have a required development permit and because they allegedly violated the California Coastal Act. Instead of complying, the company decided to sue the commission, and then the commission counter-sued them.

Acquisition will help Irvine company tackle new projects

An acquisition can be a key step toward helping a company grow quickly, so it makes sense that a small local company is doing just that in order to expand their ability to take on more projects. Kurion Inc., based in Irvine, is a small company with big dreams for the future. Californians interested in local businesses may have heard their name back in 2011 due to their involvement in the Fukushima, Japan cleanup process after they suffered a tsunami, which led to a nuclear crisis involving a power plant in the area. The company reportedly manufactured large filters for the city’s contaminated water.

As the company takes on more projects across the world, they are planning to acquire a Washington-based firm called Vista Engineering Technologies. The technology, design and engineering company has been involved in several projects with the U.S. Department of Defense and the Department of Energy, including work at a chemical weapons depot and a nuclear waste site.

Judge issues ruling on sale of Fisker automotive assests

A key ruling issued this week by Delaware Bankruptcy judge has opened the door for the Chinese auto-parts corporation, Wanxiang Group to win the final bid for the remaining assets of the bankrupt California-based electric-vehicle maker, Fisker Automotives. The $149.2 million dollar winning bid effectively ended rival company Hybrid Technology's bid to purchase the struggling automotive company's assets.

Hybrid had already snapped up the remaining $168 million balance on Fisker's loan funded through the Department of Energy for only $25 million and made an initial offer for the company of $75 million. The judge ordered an auction after Wanxiang purchased the former battery supplier to Fisker and began coordinating with Fisker's official committee of unsecured creditors in an effort to provide a rival offer.

Possibility of Comcast and Time Warner merger sparks worries

Americans tend to not want to give up their option to shop for the best price. More and more, they also don't want to give up their TV programming. Those are a couple of the reasons why this week's news that the two biggest cable providers might merge has made headline after headline.

Comcast is already the top cable provider in the country. Time Warner Cable is the second biggest. Imagine how big Comcast will be if its bid to merge with Time Warner actually goes through. The merger would be big enough to warrant a $42.5 billion. The numbers and potential impact of the merger have people talking.