California Corporate Law: Must A Security Be Written?
In yesterday’s post, I covered some of the differences between the laundry lists of securities found in the California Corporate Securities Law of 1968 and the Securities Act of 1933. Both lists seem to contemplate instruments that are written. But what does it mean to be “written”? Before the advent of computers, email and electronics, the meaning of “written” may have been obvious. A writing was something tangible, words inked on paper or parchment, chiseled in stone or impressed into clay or wax tablets. Ball point pens being a modern invention, the word for cutting or scratching came to be the word for writing in most Indo-European languages, including English. Are electronic messages written?
Section 8 of the California Corporations Code would say “yes” so long as those messages are capable of comprehension by “ordinary visual means”. Emails and text messages should generally be considered “written” under this definition. A voice-mail message, on the other hand, normally would not.
Whether an instrument is in writing is of no moment under California’s definition of a “security” because California’s list ends with the following sentence:
All of the foregoing are securities whether or not evidenced by a written document.
Cal. Corp. Code § 25019.