Process Service

WORKER COMPENSATION IN COVID-19

Workers Compensation

Undisputed Legal | Process Service

The recent COVID-19 epidemic has given state policy officials throughout the nation endless problems to tackle. Workers’ compensation insurance plays a big part in aiding people with the illness, especially their wage support, with these policies differing from state to state. In contrast to uniform federal regulation, individual states use various business models to regulate insurance. Workers’ compensation provides workers and employers with a way to ensure both a dependable source of insurance coverage as well as time-certain, predictable payments that help to decrease litigation expenses.

 Employees’ compensation offers to pay replacement benefits as well as free medical care for workers who have to take time off work. Family members may apply for financial assistance if their loved one has passed away owing to an approved circumstance. In most jurisdictions, the workers’ compensation system has a separate court system where judges make the ultimate judgment about the compensation to be given.

CAN WORKER’S COMPENSATION COVER INFLUENZA AND RELATED DISEASES

Workers’ compensation does not often cover diseases like colds and the flu, which have a low likelihood of being linked to the job. Certain states have provided relief for those exposed to chemicals and conditions that pose a danger of developing chronic diseases like cancer. For at least nineteen states, prior to the introduction of the COVID-19, compensation guidelines in workers’ compensation policies stated that it was presumed that firefighters and other first responders who got sick from breathing in hazardous materials at work would be compensated for the harm caused to their lungs and respiratory systems. The debate about whether diseases under the COVID-19 category will be part of the current policy remains.

There are numerous professions that are not hazardous that have become extremely dangerous due to the situation presented by the COVID-19 epidemic. The virus is most likely to spread to critical employees, such as those who operate public transportation, health care personnel, and grocery store staff, all of whom are at high risk of exposure at work. Workers’ compensation is mostly unavailable in most states, regardless of the working circumstances.

STATE RESPONSE TO COVID-19

States take steps to expand the compensation coverage of employees to include first aid professionals and health personnel affected by COVID-19. A typical strategy is to modify State policy such that COVID-19 infections in certain employees are considered to be working-related and covered by the compensation of workers. This assumption puts the employer and insurer on the burden to demonstrate that the infection was not linked to employment, making it simpler for employees to submit successful claims. 

Some employers and insurers have expressed worries that these policy presumptions would increase workplace insurance prices when companies are already experiencing major financial difficulties. A total of seventeen states and Puerto Rico have taken steps to expand workers’ compensation coverage to COVID-19 as an employment-related disease. Nine states have passed laws to presume coverage for different kinds of employees. Minnesota, Utah, and Wisconsin restrict coverage to primary health workers and employees. Illinois, New Jersey, and Vermont are all key workers whereas all employees are covered by California and Wyoming. In response to COVID-19, four states utilized executive branch power to impose policy presumption on first responders and health professionals. 

Four other states including California and Kentucky have adopted executive measures to protect additional key personnel like store employees.

The Department of Industries and Labor of Washington announced the advantages of pay replacement for health workers and for first responders and any associated health care expenditures reimbursed by a State workers compensation program when quarantined by a physician. Washington has one publicly administered insurance alternative, which businesses may buy and give the State greater authority over employees’ coverage. 

The ongoing COVID-19 pandemic is proving challenging for businesses in many ways, including raising the possibility of an increase in occupational illnesses. The ultimate impact on workers’ compensation systems, however, could be much more significant, including greater claims frequency for some industries, higher overall costs, and more administrative burdens for many employers.

CLAIMS VERIFICATION PROCESS

The frequency of workers’ compensation claims overall may decrease during the pandemic, with fewer working individuals. However, this impact will probably not be seen consistently across all sectors and employers’ claims may not just be exposed to COVID-19.

While many companies have moved to remote models to encourage social separation, others cannot do so simply. Aviation, transport, hospitality, construction, construction, retail, distribution, and economic sharing employees — among others — may still operate closely, putting them at increased risk of coronaviral infection via contact with clients, colleagues, and others. Similar issues are addressed by health workers, first responders, and healthcare experts, along with the danger of direct contact with COVID-19 patients. 

In all such sectors, workers may also work harder and longer than normal, which could lead to overexertion claims. Many of these injuries may be compensated through the compensation systems of state employees

LONGER WAIT TIMES FOR RESOLUTION

In addition to a higher claims frequency in some sectors, businesses should be prepared to stay open for a longer time on current and future claims. State workers’ compensation boards have been closed to the public across the nation; some hearings take place online, but many of them are postponed. There are also limited claim resources, like independent medical examinations and field investigation services.

Injured staff may potentially be delayed in their rehabilitation. With many treating doctors and physical therapists temporarily shutting their offices and hospitals with COVID-19 patients, regular visits and optional operations are canceled or postponed. Similarly, nurse case managers are unable to access claimants, essential medical treatments – including MRI and another diagnostic testing. And with many companies closed in the foreseeable future, even many workers who are developing and ready to return to work on a reduced duty have no transition positions they may return to.

While claims of these workers remain open and do not require medical treatment to help their recovery, they continue to receive benefits. Cases in litigations will mainly remain unresolved until the state workers’ compensation boards start operations — and it gets harder for them, as long as the wounded employees remain away from workplaces.

The Centers for Disease Control and Prevention (CDC), the Washington State Department of Health (DOH), and other public health agencies are responding to an outbreak of a respiratory disease known as new coronavirus, or COVID-19.

WORKERS’ COMPENSATION COVERAGE AND CORONAVIRUS (COVID-19)

If a worker cannot work due to their work-related injury or illness, then their time-loss payments will continue. The time period to protest or appeal an order doesn’t start until the order is communicated. If the individual cannot access the order through no fault of their own, they must provide the claim manager with some evidence or an explanation as to the same. It must be noted that the economic stimulus checks approved by the federal government in response to the coronavirus pandemic are not used to determine the amount of time-loss or pension benefits.

As an example, Washington Gov. Jay Inslee signed in law two laws granting presumed health care professionals and frontline workers’ salaries during public health situations, such as the COVID-19 epidemic. The new legislation means that health care professionals are suspected of having contagious or infectious diseases at work as soon as they submit a claim of compensation for workers.

Other claims that satisfy specific exposure requirements will be evaluated individually. When a claim is granted, employees are entitled to medical and disability payments. The insurer is responsible for COVID-19 therapy. Currently, supportive care to alleviate symptoms is the sole therapy in many states novel coronavirus.

Appropriate testing and monitoring, as medically necessary, would also be provided. That is a time-limited benefit and no benefits would be given once the employee test for COVID-19 is negative or the quarantine period is over unless the employee gets the illness.

GENERAL COMPENSATION FOR ALLOWED CLAIMS

The earliest of the benefits starts for healthcare and frontline employees, who acquire the illness, interim salary replacement or time-loss benefits for [A.] the first day of work missed due to illness., [B.]  medical professional or public health officer quarantined the working day or [C.] on the day a positive result confirmed by the worker’s infectious or contagious illness contraction.

For other claims permitted, time loss reimbursement for lost earnings may be granted for up to 14 days during the quarantine period; however, the first three days may not be paid unless the worker is medically obliged to stay out of work on the 14th day after exposure. The CDC states that COVID-19 symptoms may occur between 2 to 14 days of exposure.

WHEN WOULD A CLAIM LIKELY BE DENIED?

When the contraction of COVID-19 is incidental to the workplace or common to all employment (such as an office worker who contracts the condition from a fellow worker), a claim for exposure to and contraction of the disease will be denied.

State legislatures across the country moved to clarify more precisely how employees infected with COVID-19 while their job would be handled under national compensation legislation as a result of the COVID-19 epidemic. For example, in Illinois, HB 2445 was passed, which established a rejected presumption that critical employees contracting COVID-19 did so in the course of their jobs and would be entitled to reimbursement for workers’ benefits.

During the legislative session in 2021, any legislation providing special protection for vital employees was failed for the State of Louisiana. The Senate Bill 475 provided that every essential worker, particularly those who work in public safety, government, response to disasters, health care, or private business, should have the right to compensation for workers as if he had suffered a body injury traditionally covered by the workers’ compensations law Senate Bill 475

There has been no additional action to address COVID-19 under the Compensation Act of Louisiana employees: there is still no specific classification of essential workers, nor is COVID-19 an officially recognized injury under the Compensation Law of Louisiana workers. Legislative action appears improbable until the overall population gets vaccinated and the virus COVID-19 becomes more controllable (in spite of the Delta variants).

Workers covered by the compensation legislation in Louisiana continue to lose time because of this illness. With no law to rapidly monitor the pay-out of COVID-19 claims, employers, workers’ compensation carriers and managers must look at a more conventional examination of whether the Louisiana statute of workers’ compensation covers occupational injuries or sickness. Defense stakeholders specifically need to establish whether COVID-19 claims are deemed ‘accidental injuries’ or ‘occupational illnesses’ to properly administer and possibly defend a COVID-19 claim. 

WORKER COMPENSATION IN NEW YORK STATE

In New York State, individuals may obtain compensation payments for employees due to the COVID-19 exposure, depending on the circumstances. Employers must have compensation insurance to provide payments to employees who are sick or injured because of their jobs. This is characterized as a sickness or injury linked to employment. The status of immigration is not a consideration. For over a century, the Board of New York State Workers’ Compensation has reacted by guaranteeing the fast handling of claims and payments of compensation immediately to outbreaks and chronic injuries. The Board of Directors has similarly provided compensation to meet the requirements of wounded employees across the state, from illnesses such as TB and asbestosis and even in case of traumatic events like the 9/11 catastrophe. 

The claim will be evaluated by the workers’ compensation insurance company of the employer. If the insurance company approves the claim, then the person may pay the COVID-19 claim (known as compensable). If the carrier contests the claim, a judge in the Board decides whether the claim should be reimbursed. The court will listen to the statements and any health care provider’s evidence to find out where the individual is working if they have been exposed to COVID-19, the amount of the exposure, and whether COVID-19 exposure is common in the particular working environment.

The Worker’s Compensation Law stipulates that the injured worker’s medical care be paid for job-related diseases or injuries. ̈Wage substitution benefits if their disease stops them from working. ·Benefits to surviving employees in case of death. ̈Funeral expenditures up to USD 12,500 in New York, Nassau, Suffolk, Rockland, and Westchester County and up to USD 10,500 in other New York counties.

In the case of occupational activity, the Industrial Insurance Act provides for the treatment of COVID-19 and meets specific requirements. In such situations, the worker must be more likely to acquire the illness because of labor (examples include first responders or health care workers). A proven or likely work-related exposure and an employee/employer connection must also be available

For more information on serving legal papers, contact Undisputed Legal our Process Service department at (800) 774-6922. Representatives are available Monday-Friday 8 am – 8 pm EST.  If you found this article helpful, please consider donating.  Thank you for following our blog, A space dedicated to bringing you news on breaking legal developments, interesting articles for law professionals, and educational material for all. We hope that you enjoy your time on our blog and revisit us!  We also invite you to check out our Frequently Asked Questions About Process Servers.

Sources

1. ‘Guidance on Feca Coverage for the Flu.’ United States Department of Labor, www.dol.gov/agencies/owcp/dfec/fluguidance. 

2. See 20 C.F.R. § 10.115.

Federal employees claiming an injury due to contact with the flu virus must be in the performance of duty within the meaning of the Federal Employees’ Compensation Act (FECA) to be covered. These employees have the same burden to establish the basic requirements of coverage as other claimants and must submit medical evidence in support of an identifiable injury in the course of their federal employment and any related period of disability. 

Two tests must be satisfied before an illness or disease can be considered occupational and compensable under workers comp:
– The illness or disease must be ‘occupational,’ meaning it arose out of and was in the course and scope of the employment.
  The illness or disease must arise out of or be caused by conditions ‘peculiar’ to the work.

3. Butry, David T, et al. ‘The Economics of Firefighter Injuries in the United States.’ 2019, doi:10.6028/nist.tn.2078. 

4. ‘The Territorial Impact of COVID-19: Managing the Crisis and Recovery across Levels of Government.’ OECD, 10 May 2021, www.oecd.org/coronavirus/policy-responses/the-territorial-impact-of-covid-19-managing-the-crisis-and-recovery-across-levels-of-government-a2c6abaf/. 

5. ‘Inslee Announces Workers’ Compensation Coverage to Include.’ Governor Jay Inslee, www.governor.wa.gov/news-media/inslee-announces-workers-compensation-coverage-include-quarantined-health-workersfirst. 

6. Washington State Department of Labor & Industries. Common Questions about Presumptive Coverage for Health Care and Frontline Workers, www.lni.wa.gov/agency/outreach/common-questions-about-presumptive-coverage-for-health-care-and-frontline-workers. 

7. Office, WA Governors. ‘Inslee Signs Worker Protection Legislative Package in Yakima.’ Medium, Washington State Governor’s Office, 11 May 2021, medium.com/wagovernor/inslee-signs-worker-protection-legislative-package-in-yakima-6dd2775b7ea8. 

8. 20 CFR § 10.115 – What evidence is needed to establish a claim?

Forms CA-1, CA-2, CA-5, and CA-5b describe the basic evidence required. OWCP may send a request for additional evidence to the claimant and to his or her representative if any; however the burden of proof still remains with the claimant. Evidence should be submitted in writing. The evidence submitted must be reliable, probative, and substantial. Each claim for compensation must meet five requirements before OWCP can accept it. These requirements, which the employee must establish to meet his or her burden of proof, are as follows:

(a) The claim was filed within the time limits specified by the FECA;

(b) The injured person was, at the time of injury, an employee of the United States as defined in 5 U.S.C. 8101(1) and § 10.5(h) of this part;

(c) The fact that an injury, disease, or death occurred;

(d) The injury, disease, or death occurred while the employee was in the performance of duty; and

(e) The medical condition for which compensation or medical benefits is claimed is causally related to the claimed injury, disease, or death. Neither the fact that the condition manifests itself during a period of Federal employment nor the belief of the claimant that factors of employment caused or aggravated the condition, is sufficient in itself to establish a causal relationship.

(f) In all claims, the claimant is responsible for submitting, or arranging for submittal of, a medical report from the attending physician. For wage loss benefits, the claimant must also submit medical evidence showing that the condition claimed is disabling. The rules for submitting medical reports are found in §§ 10.330 through 10.333.

9. Illinois General Assembly – BILL Status For hb2445, www.ilga.gov/legislation/BillStatus.asp?DocTypeID=HB&DocNum=2445&GAID=15&SessionID=108&LegID=118453. 

10. Oubre, Trenton J., et al. ‘Louisiana Workers’ Compensation Law and COVID-19 as a POTENTIAL Compensable Occupational Disease.’ Lexology, Breazeale Sachse & Wilson LLP, 15 Apr. 2020, www.lexology.com/library/detail.aspx?g=7ecea071-5803-48c1-9217-243d7473b1dc. 

11. However, COVID-19 could be conceivably deemed a compensable ‘Occupational Disease’ under the Louisiana Workers’ Compensation Act, as discussed above, if COVID-19 is found to be contracted while arising out of and in the course of employment, and peculiar to or characteristic of specific employment.

12. ‘Workers’ Compensation Board.’ WCB Information Related To Novel Coronavirus (COVID-19), www.wcb.ny.gov/covid-19/. 

13. ‘Workers’ Compensation.’ Workers’ Compensation – Law Department, www1.nyc.gov/site/law/divisions/workers-compensation.page. 

The City of New York is a self-insurer of its workers’ compensation obligations pertaining to all covered City employees. Most City employees are covered for workers’ compensation (with the exception of uniformed police officers, firefighters, and uniformed sanitation workers). Also included are non-pedagogical employees of the Department of Education and all employees of the Health and Hospitals Corporation and the City University.

14. ‘Governor Cuomo Signs into Law New MEASURE Providing Death Benefits for Families of Frontline Government Workers Who Lost Their Lives Due To Covid-19.’ Reimagine, Rebuild and Renew New York, www.governor.ny.gov/news/governor-cuomo-signs-law-new-measure-providing-death-benefits-families-frontline-government. 

HOW TO SERVE LEGAL PAPERS AT CORPORATION SERVICE COMPANY

Undisputed Legal | Process Service

Corporation Service Company was founded in Delaware close to a hundred and twenty years ago by individuals from the legal community in an effort to provide entity formation and statutory representation services to businesses. Corporation Service Company is a global organization serving clients in a variety of sectors including business, legal, tax, and digital branding has launched a new brand identity in its rebranding efforts. This was done with an expanded office presence in many regions of the globe.

Corporation Service Company changed its name to CSC, the latter of which shows how the company’s commercial branding is distinct from its official name, Corporation Service Company. Corporation Service Company is still used as the legal trade name.

 HISTORY OF CORPORATION SERVICE COMPANY

In 1990, CSC took over Corporate Information Services, a Florida-based company. Between 1989 and 1998, CSC grew by acquiring nine service providers. This includes Prentice Hall Legal & Financial Services in 1995.  In a major acquisition that contributed to Corporation Service Company rebranding as CSC,  the entity bought Lexis-Nexis Document Solutions to provide legal, secured lending, and motor vehicle services in 2003.

The entity bought Lexis-Nexis Document Solutions to provide legal, secured lending, and motor vehicle services in 2003. CSC additionally purchased MLM Information Services, the most prominent corporate tax administration services supplier in the market, in 2011.    CSC then went on to acquire Melbourne IT’s an online brand services business, which includes the company domain name. These plethoras of acquisitions, opened up the floor for CSC to provide a wide variety of office services: domain name administration, trademark searches, phishing prevention, secure sockets layer certificates, domain name system services are all now provided by the unit under the new moniker CSC Digital Brand Services.

CSC bought Koehler Group in 2015 along with a handful of other businesses. Hong Kong-based Koehler Group serves a wide range of services, including incorporation, accounting, and tax advisory. CSC benefits from Koehler Group’s solutions, which provide CSC more business process outsourcing capabilities. Koehler Group is a top corporate service provider with over a hundred accountants, trade consultants, and legal experts located in Hong Kong, Singapore, and China. The company was founded in 1979.

CSC, in its statements, credited the acquisition as procurement of a complementary set of services and experience from Koehler Group, which then delivers an all-in-one global corporate services package. Founded in 1979, Koehler Group is an international company known for its accounting and management consulting services. The Koehler Group offers a broad variety of services to corporations that want to enter Hong Kong, Singapore, and China, including incorporation, tax, accounting, trade assistance, and human resource services. CSC has offices across North America, Europe, and the Asia-Pacific region, at locations spread throughout those continents. Consequently, in 2017, Corporation Service Company officially rebranded to CSC Global.

HOW DOES A CORPORATION SERVICE COMPANY WORK

CSC was established in 1899, and now it has a diverse portfolio of industries. CSC has offices all around the globe, including North America, Europe, and the Asia-Pacific area. CSC is based in Wilmington, Delaware.

A registered agent must be hired by all American companies to receive legal and tax notifications, official papers, and more. Most company owners who use their own names as their registered agents are doing so because they assume they have to. CSC is one of these kinds of agencies. Nearly three-quarters of the Fortune 500 and around two-thirds of the world’s foremost brands rely on the entity’s Process Service of receiving and distributing legal papers to its customers. However, over the years, CSC has broadened its scope beyond only providing Process Service

It is decidedly difficult to reach a specific office of CSC to prevent misattribution of Process Service since the entity has representation in all fifty states. The main headquarters of the entity, however, remain in Wilmington, Delaware. This does not mean that this office of CSC is the only relevant one since most individuals focus on serving legal papers to CSC’s office in Albany, New York for New York City Process Service. The Albany Office filed for incorporation with the New York Department of State quite a while after the Wilmington address, registering on 13th August 1969 whereas the original formation date of the entity was 17th April 1920. Consequently, the jurisdiction of CSC stems from the state of Delaware. 

For Process Service on CSC, the address for the Principal Officer of the entity must be referred to. It must be remembered that Process Service should be addressed to the United States Corporation Company. However, Process Service may also be provided to the chief officer or any other higher-up with the requisite authority to accept the service. It must be known that a commercial registered agent has specific requirements to accept Process Service levied upon it. 

WHAT IS A COMMERCIAL AGENT

Registered agents are usually chosen for their availability or expertise in receiving legal communications, and the commercial registered agent is an example of this kind of registered agent. Nearly a dozen states use the terms commercial and non-commercial registered agents. Several other states use the same or similar ideas.

In most cases, a commercial registered agent is an entity or individual who has submitted an information-rich registration statement with their state’s agency that regulates corporations. The listing statement was created to make communicating with the commercial registered agent easier for the Secretary of State. 

States are made aware of who an entity represents, and there are easy tools to do mass address changes. Commercial registered agents’ service to their customers provides a sense of security. Registered agents, whether commercial and or non-commercial,  have essentially the same duties. To be appointed, they must consent to be appointed, maintain a physical address in the state, and fulfill other legal criteria.

Nevertheless, important legal distinctions are included in the Model Registered Agents Act’s commercial and non-commercial registered agents (MORAA). A commercial agent who has lodged an official registered agent listing statement with the jurisdiction it performs in, having paid the charge involved with filing, and typically represents several companies under the same jurisdiction.

Registered agents use MORAA to easily get commercial entity status at state corporation offices. This allows business registered agents to update their information, quit, and unregister in a much simpler and more efficient manner. The MORAA allows a registered agent to designate someone else to sign on their behalf if they are working in a state that has adopted MORAA.

REQUIREMENTS TO SERVE PAPERS ON CSC

In order to serve a legal document, CSC must be the registered agent of the business that the service of process is targeting. If this precondition is not fulfilled, CSC cannot receive, process, or transmit any Process Service that has been provided, since the entity is not authorized to do the same within the boundaries of a Commercial Registered Agent. The Process Server cannot also merely leave the papers with the CSC, since CSC will refuse to accept the delivery since the Process Service is not acceptable. The plaintiff will thereinafter have to issue a new summons, refer to the defendant properly, and restart service.

It is essential to take due diligence in conducting an investigation on the recipient’s registered agent. It is also required to ensure that whatever type of legal document the individual wish to forward to CSC, the documents should be delivered in a timely manner. The legal notice must make its way to the proper recipient promptly.

MAJOR ISSUES IN SERVING CSC

To make sure that the legal notice will not be rejected by CSC, it is required to [A.] check the Division of Corporations, State Records and Uniform Commercial Code for the complete and official name of the company in order to avoid errors that could furnish grounds for rejection, [B.] check if the legal document they wish to serve is listed with the Division since CSC only accepts notices that are included in the list, [C.] place the official name of the entity on top, followed by ‘c/o Corporate Service Company’ below it and [D.] when filling out the documents, do not write names of individuals since there remains a high possibility that the CSC will reject papers when individuals are mentioned.

For service on a Registered Agent, it must be remembered that if the service is taking place at a business, either the individual named must be personally served or an officer or managing member of the company.  The question is different if service is done at a home instead. In case the Process Service is done at a home, there is a prerequisite of personal service. Additionally, the personal service should be specifically done upon the agent or upon an officer or managing member of the company. If another individual answer the door other than the subject, the server must confirm they are an officer. Quire frequently,  clients will request only personal service since personal service is often considered to be the most airtight service and appears to prevent any potential rejection of Process Service. 

The requirement imposed by many jurisdictions that every LLC and company employ a state-registered representative to handle legal correspondence, sometimes called a statutory agent or resident agent is referred to as statutory representation.

When dealing with legal paperwork, business owners frequently serve as registered agents. Doing so, however, may entail identifying themselves as a target. To prevent making any mistakes, most organizations bring in outside experts to help handle the service of process documentation. Courts in states enforce fines for failing to reply to letters extremely severely, even if a response is delayed due to a valid cause.

The nature of a registered agent’s authority varies among the states since each has different rules about what a registered agent may and cannot do. Accepting tax notifications, yearly report forms, and company license renewals, for example, are among the many official obligations. 

OTHER FUNCTIONS OF CSC

CSC receives and delivers important legal paperwork on its clients’ behalf. CSC is extensive in its capacity as a compliance firm, aiding clients to source and maintain the right licenses and permits, regardless of where they operate or the industry wherein they may be established. Essentially, covering these requirements means that CSC can provide the kind of services that allow companies to expand their businesses into other states and other countries without having the immediately tackle the specific Process Service requirements that every single new jurisdiction may need

CSC gives corporate law departments the tools they need to organize, file, and safeguard their case-critical documents. This means that a major role of CSC would be to oversee and maintain the good standing of an unlimited number of entities. 

Financial institutions are also major clientele for CSC since the entity provides risk-management options that allow it to partner with banks and commercial lenders to enhance due diligence and minimize risk through financial searches and filings. This also means the entity can aid in financial management by streamlining the process for the title and real property management, special purpose entities, and independent directors.

 HOW DOES CSC WORK AS A REGISTERED AGENT

The name and address of the registered agent are usually indicated in reports and the articles of incorporation, the statement of the LLP registry, or the limited partnership certificate. The application for authority to be doing business in other States further would require the same. In certain instances, permission is often required from the Representative for the appointment. When a shift in the Registered Agent or their address (registered office) occurs, the state must be informed as to the change.

The primary aim of the agent would be to have a legal address that is not a P.O. Box within the state jurisdiction where there are individuals accessible during regular business hours to enable legal process operations to be conducted in case of a lawsuit. Typically, the registered agent is the person to whom the state government automatically sends all the official documentation needed each year for the purposes of legal action or taxation. It is the responsibility of the registered agent to forward certain suit records and notes to the company itself. Registered agents may often advise business associations as to whether their state government filing status is in ‘good standing’.  The justification for these notices being a feature of a registered agent is because it is virtually impossible for a corporate organization to maintain track of regulatory amendments and to disclose due dates for various jurisdictions it may conduct business in, considering the disparate legislation of different states.

Failure to retain a licensed agent may result in the revocation of the legal status of a corporation or LLC, the imposing of penalty fees on an individual, or both. Delaware General Corporation Law requires registered agents to [A.] be a legal resident of Delaware which also means that the entity should maintain a registered office in Delaware; [B.] have a physical location in Delaware where they can, during normal business hours, accept service of process, legal notifications, and annual report notifications; [C.] provide reliable means to forward all documents received to the responsible parties and [D.] keep on file the name, business address and business telephone number of a natural person who serves as the communications contact on behalf of a Delaware corporation or LLC

For more information on serving legal papers, contact Undisputed Legal our Process Service department at (800) 774-6922. Representatives are available Monday-Friday 8 am – 8 pm EST.  If you found this article helpful, please consider donating.  Thank you for following our blog, A space dedicated to bringing you news on breaking legal developments, interesting articles for law professionals, and educational material for all. We hope that you enjoy your time on our blog and revisit us!  We also invite you to check out our Frequently Asked Questions About Process Servers.

Sources

1. Delaware Business Now. ‘Corporation Services Rebrands to CSC.’ Delaware Business Now, 22 May 2017, delawarebusinessnow.com/2017/05/corporation-services-rebrands-csc/. 

2. Pace, Eric. ‘ENGLEWOOD Cliffs, N.j.’ The New York Times, The New York Times, 4 Apr. 1982, www.nytimes.com/1982/04/04/business/cradle-to-grave-with-prentice-hall-englewood-cliffs-nj.html. 

3. ‘LexisNexis sells document solutions unit to Corporation Service Co..’ The Free Library. 2003 JK Publishing, Inc https://www.thefreelibrary.com/LexisNexis+sells+document+solutions+unit+to+Corporation+Service+Co.-a0107277563

4. The IP Mirror brand offered services such as corporate domain name registration and online trademark protection. CSC, which was the world’s third-largest outsourcer in 2014, also purchased the IP Mirror brand.   CSC Digital Brand Services’ capacity to provide services in the Asia-Pacific area increased significantly when it acquired IP Mirror.

5. Through the years, CSC has evolved from a regional registered agent firm associated with mergers and acquisitions and other corporate transactions to a global leader helping some of the largest companies, financial institutions, and law firms stay compliant, manage risk, and streamline their workflows,’ says CSC President and Chief Executive Officer Rod Ward.

‘This is the first substantial change to our logo and brand strategy since our company’s founding,’ says Ward. ‘In the past 10 years, we’ve doubled in size, made strategic acquisitions, and expanded our footprint to 17 countries. Our distinctive new look reflects the interconnected, evolving relationship we have with our clients. The infinity-style symbol helps us tell the story of our integrated solutions, and our ability to streamline operations, generate trust, and deliver exceptional results.’

6. UNITED STATES CORPORATION COMPANY

Address:80 STATE STREET, ALBANY, NY, 12207

7. C/O UNITED STATES CORPORATION COMPANY

Address:251 LITTLE FALLS DR, WILMINGTON, NY, United States, 19808

8. Chief Executive Officer’s Name and Address

Name: RODMAN WARD III

Address:251 LITTLE FALLS DRIVE, WILMINGTON, DE, United States, 19808

9. International Association of Commercial Administrators. ‘Model Registered Agents Act – Technical Challenges of Implementation’ (pdf). International Association of Commercial Administrators. pp. 4–5.

10. In 2004, IACA met and agreed to develop a resolution to simplify registered agent registration processes. Their work is dubbed MoRAA and has many consequences, including a separate classification of commercial and noncommercial registered agents.

 MODEL REGISTERED AGENTS ACT (2006) (LAST AMENDED 2011)

11.‘Any business entity other than an individual proprietorship in every state may register an agent for three purposes: to receive service of process; establish a venue for any legal action; and for publication of notices required by the entity’s organic law’. 

12. The responsibility falls upon the server to confirm the status of the individual another officer of the company before they can sub-serve. However, this does not preclude service of process upon a Member of Household if service is at the place of abode for the Officer or Registered Agent for the Corporation

13. Information about persons or entities that are available to act as registered agents in a given state is maintained by the state’s Secretary of State office. Most states also offer free online database searches to identify a business entity’s registered agent. Some state business entity laws name the Secretary of State’s office or business entity filing office as the registered agent of last resort, in the event, the named registered agent can’t be found.

14. Delaware General Corporation Law 8 Del. C. §131 and §132

HOW TO SERVE LEGAL PAPERS ON FANNIE MAE

Fannie Mae

Undisputed Legal | District of Columbia Process Service

The Federal National Mortgage Association or Fannie Mae is a federally supported corporation with a long history. Starting as a private business in 1968, it later became publicly listed in 1971 and is classified as a United States government-sponsored enterprise.  The main driving force of the corporation is to encourage lending and bolster the local lending industry by assisting lenders to reinvest the money they would otherwise have to put into securities back into lending. In consequence, this will make mortgage lenders rely less on local savings and loan associations and grow their overall business in the process. 

The Fannie Mae is tied to the Federal Home Loan Mortgage Corporation (Freddie Mac.) The entity was founded in 1938 during the Great Depression as part of the New Deal.

HISTORY OF FANNIE MAE

In the early 1900s, the majority of mortgage loans in the United States were short-term balloon payment loans.  What this meant was that the mortgage did not fully amortize over the term of the note and as a result, left a balance due at maturity. During the Great Depression, individuals who were unable to work or pay for their mortgages fell victim to a sub-par housing market, which led to a whopping 25% of the total mortgage debt in the country falling in default by 1933.  This rendered over a quarter of the total population of homeowners in America to have their homes thereinafter foreclosed, losing their houses to the banks. 

In response, Fannie Mae was created by the U.S. Congress in 1938 during the Roosevelt administration as part of the New Deal, as an effort to combat the Great Depression. The National Mortgage Association of Washington (NMA) was set up to support local banks and to aid in lending to help increase levels of house ownership and to offer affordable housing.  The Federal National Mortgage Association (Fannie Mae) was instrumental in making the secondary mortgage market liquid and in boosting the number of mortgages, especially FHA-insured mortgages, available for consumers to purchase. After its launch, Fannie Mae had a monopoly on the secondary mortgage market for the first thirty years. The government had a strong interest in bringing the jobless construction trade workers back to work, and they may have encouraged New Deal initiatives in order to do this.

Fannie Mae was obtained by the Federal Housing and Finance Agency (FHFA) in 1950 from the Federal Loan Agency (FHA).  The Federal National Mortgage Association Charter Act of 1954 converted Fannie Mae from a ‘mixed-ownership corporation’ to private ownership; the federal government had the preferred stock, while private investors held the common stock.  The 1968 move was to take the corporation off the federal budget, thus allowing it to engage in riskier and higher-return activities.

UNDERSTANDING HOW FANNIE MAE WORKS

It must be known that Fannie Mae is not the only agency that was important for the boosting of mortgages. Fannie Mae’s predecessor was once a single entity, but a 1968 law caused it to be divided in two: the present Fannie Mae and the Government National Mortgage Association (‘Ginnie Mae’). Ginnie Mae, a government entity, is a guarantor for loans guaranteed by the Federal Housing Administration (FHA), the Veterans Administration (VA), and the Farmer’s Home Administration (FmHA). In other words, the Ginnie Mae is the sole agency supported by the U.S. government’s full confidence and credit.

Fannie Mae previously only purchased conventional loans, which were those that were not insured by the FHA, VA, or FmHA. However, the entity was given a new charter in 1970 by the federal government, giving it the ability to purchase conventional loans. In order to compete with Fannie Mae, the Federal Home Loan Mortgage Corporation (FHLMC), more commonly known as Freddie Mac, was also chartered in 1970. This provided for a more robust and efficient secondary mortgage market.   FNMA became public on both the New York and Pacific Exchanges in the same year.

The name mortgage-backed securities (MBS) was originally used in 1981 when Fannie Mae issued its first mortgage passthrough. In 1971, Freddie Mac issued its first mortgage pass-through, known as a participation certificate, which was made up mostly of private loans and was guaranteed by Ginnie Mae.

WHERE DOES FANNIE MAE RECEIVE ITS REVENUE

The concept of mortgage-backed securities (MBS) was originally used in 1981 when Fannie Mae issued its first mortgage passthrough. In 1971, Freddie Mac issued its first mortgage pass-through, known as a participation certificate, which was made up mostly of private loans and was preceded by the first mortgage passthrough security of an approved loan guaranteed by Ginnie Mae.

Fannie Mae also generates a significant part of its revenue from guarantee fees on mortgage loans underpinning its single-family Fannie Mae mortgage-backed securities and on single-family mortgage loans maintained in its retained portfolio. Investors, or buyers of Fannie Mae mortgage-backed securities, are prepared to allow Fannie Mae to retain this charge in return for Fannie Mae taking credit risk, or guaranteeing that the scheduled principal and interest on the underlying loan would be paid even if the borrower fails.

Historically, Fannie Mae’s charter prohibited it from guaranteeing loans with loan-to-value ratios more than 80% without mortgage insurance or a repurchase agreement with the lender. This rule is not hard and fast, however, since, in 2006 and 2007, Fannie Mae purchased subprime and Alt-A loans as investments. 

THE UNDERLYING MECHANISM DRIVING FANNIE MAE

Fannie Mae is a buyer of mortgage loans and the underlying mortgages, which it bundles into mortgage-backed securities. What this means is that Fannie Mae acquires mortgage loans from authorized mortgage sellers and securitizes them. In turn, the entity then offers the resulting mortgage-backed security to investors in the secondary mortgage market, accompanied by a guarantee that the stated principle and interest payments would be made on time. Additionally, Fannie MBS, like Freddie Mac and Ginnie Mae MBS, may be traded in the ‘to-be-announced or ‘TBA’ market.  By buying mortgages, Fannie Mae and Freddie Mac offer more capital for banks and other financial institutions to issue new loans. This provides the housing and credit markets in the United States with flexibility and liquidity.

To ensure that Fannie Mae can guarantee the mortgage-backed securities it produces, it establishes criteria for the loans it will buy, referred to as ‘conforming’ loans. Fannie Mae developed an automated underwriting system (AUS) tool called Desktop Underwriter (DU) that lenders can use to determine automatically whether a loan is conforming; in 2004, Fannie Mae released Custom DU, which enables lenders to create custom underwriting rules to handle nonconforming loans as well. Jumbo loans, which are loans bigger than the limit that Fannie Mae and Freddie Mac would buy, are included in the secondary market for non-conforming loans. 

RESTRICTIONS AND REGULATIONS FOR FANNIE MAE LOANS

Fannie Mae and Freddie Mac have a maximum loan amount for which they will guarantee. This is referred to as the ‘conforming loan limit.’ The Office of Federal Housing Enterprise Oversight (OFHEO), which regulates both GSEs, sets the conforming loan ceiling for Fannie Mae and Freddie Mac. OFHEO yearly establishes the maximum amount of a conforming loan based on October-to-October fluctuations in the national median house price, beyond which a mortgage is classified as a non-conforming jumbo loan. Alaska and Hawaii have a 50% greater conforming loan limit.

The GSEs will only purchase conforming loans for repackaging into the secondary market, thus reducing demand for non-conforming loans. As a result of the law of supply and demand, lenders find it more difficult to sell these loans in the secondary market, and therefore these loans usually cost borrowers more (about 1/4 to 1/2 of a percent). 

FANNIE MAE’S GOVERNMENT SUPPORT

Originally, Fannie had an ‘explicit guarantee’ from the government; if it got in trouble, the government pledged to save it. This began to alter around 1968. Ginnie Mae and Fannie were divorced. Ginnie kept the express assurance. Fannie, on the other hand, became a private company established by Congress and endowed with a direct line of credit from the United States Treasury. Its status as a Government Sponsored Enterprise (GSE) effectively guaranteed its financing. Additionally, their charter restricted its operations to the mortgage sector. In this respect, they could not function normally as a private business, notwithstanding their status as a private corporation.

Fannie Mae received no direct government financing or support, and the securities issued by Fannie Mae had no express government guarantee of repayment. This was made very apparent in the legislation authorizing GSEs, on the securities themselves, and in many public statements released by Fannie Mae. [reference required] Neither the certificates themselves nor their principal and interest payments were expressly guaranteed by the US government. Except for Fannie Mae, the certificates did not represent a liability or obligation of the United States or any of its agencies or instrumentalities. Throughout the subprime crisis, each Fannie Mae prospectus stated in bold, all-caps letters: ‘The certificates and payments of principal and interest on the certificates are not guaranteed by the United States and do not constitute a debt or obligation of the United States or any of its agencies or instrumentalities other than Fannie Mae.’ 

However, the implied guarantee, as well as other favorable government treatment, helped Fannie’s success considerably. For instance, the implicit guarantee enabled Fannie Mae and Freddie Mac to save billions of dollars in borrowing costs due to their excellent credit ratings. The Congressional Budget Office and the Treasury Department estimate the cost at about $2 billion each year. 

Fannie Mae and Freddie Mac were permitted to maintain less capital than other financial institutions: for example, they were permitted to offer mortgage-backed securities with just half the capital needed of other financial organizations. The FDIC Bank Holding Company Act contains regulations governing the solvency of financial institutions. The rules mandate that conventional financial institutions maintain a capital-to-assets ratio of at least 3%. The GSEs, Fannie Mae, and Freddie Mac, are free from this rule and may, and often do, maintain a capital-to-assets ratio of less than 3%. Increased leverage enables higher profits in good times but exposes businesses to greater risk in bad times, such as the subprime mortgage crisis. 

EXEMPTIONS OCCURRING TO FANNIE MAE

FNMA is tax-free on a state and municipal level, with the exception of some real estate taxes. Additionally, FNMA and FHLMC are exempt from SEC filing requirements; they submit 10-K and 10-Q reports with the SEC but do not file many other filings, including some disclosures relating to their REMIC mortgage securities.

Finally, money market funds are required to diversify their holdings, with no more than 5% of assets coming from a single issuer. That is, a worst-case default would result in a fund losing no more than 5% of its value. These regulations, however, do not apply to Fannie and Freddie. It would not be uncommon to discover a fund that invested the lion’s share of its assets in Fannie and Freddie’s debt.

The Congressional Budget Office said in 1996 that ‘no government funds have been appropriated for cash payments or guarantee subsidies.’ However, in lieu of federal money, the government offers significant unpriced advantages to businesses. Government-sponsored businesses are expensive for the government and taxpayers.

FNMA is a financial institution that uses derivatives to ‘hedging’ its cash flow. Interest rate swaps and options to enter interest rate swaps are among the derivative instruments it utilizes (‘pay-fixed swaps’, ‘receive-fixed swaps’, ‘basis swaps’, ‘interest rate caps and swaptions’, ‘forward starting swaps’). The duration gap is a financial and accounting phrase that refers to the difference between the duration of assets and obligations. It is often used by banks, pension funds, and other financial organizations to quantify their interest rate risk.

SERVING PAPERS ON FANNIE MAE

Fannie Mae comes under District of Columbia Process Service guidelines and is specifically classified under the SIC Code 6111 for Federal And Federally Sponsored Credit Agencies. SIC Code 6111 – Federal and Federally-Sponsored Credit Agencies is a final level code of the ‘Finance, Insurance, Real Estate Division. There are currently twenty-eight companies classified in this industry in the USA

Fannie Mae retains its business address for accepting District of Columbia Process Service in Midtown, which also functions as its mailing address for District of Columbia Process Service. The entity also has a phone number in order to ensure District of Columbia Process Service is done easier.  

If it is a personal matter involving an employee of Fannie Mae, they must be personally served according to the District of Columbia Process Service. Serving a subject personally at this location can be extremely difficult if the subject to be served is unwilling to receive District of Columbia Process Service. Security may stop servers from entering and must know the reason for District of Columbia Process Service. 

It must be known that according to requirements of the District of Columbia Process Service, Fannie Mae retains the authority to supervise and control any litigation involving a Fannie Mae mortgage loan. This renders a responsibility upon the servicer handling the District of Columbia Process Service to cooperate fully with Fannie Mae in prosecuting, defending, or resolving the matter. Fannie Mae must be referred to in judicial proceedings as ‘Federal National Mortgage Association (‘Fannie Mae’), a company established and operating under the laws of the United States of America.’ Fannie Mae is specifically not a government entity and should not be treated as such in furtherance of the  District of Columbia Process Service.

Without prior written permission from Fannie Mae, the servicer is not allowed to start or intervene in District of Columbia Process Service or legal proceedings on Fannie Mae’s behalf, with the exception of regular foreclosures, bankruptcy cases, and possessory actions for certain mortgage loans. Additionally, in order to comply with District of Columbia Process Service guidelines, the servicer should take all reasonable steps to avoid the attachment of additional liens against the property that would be superior to Fannie Mae’s mortgage claim. 

Recently, the Federal Housing Finance Agency raised the number of days investors are barred from bidding on foreclosure properties to allow others a chance to purchase houses first.  With this change, owner-occupants, charities, and public organizations have thirty days to bid solely on Fannie Mae and Freddie Mac-owned real estate, compared with twenty days before.

For more information on serving legal papers, contact Undisputed Legal our District of Columbia Process Service department at (800) 774-6922. Representatives are available Monday-Friday 8 am – 8 pm EST.  If you found this article helpful, please consider donating.  Thank you for following our blog, A space dedicated to bringing you news on breaking legal developments, interesting articles for law professionals, and educational material for all. We hope that you enjoy your time on our blog and revisit us!  We also invite you to check out our Frequently Asked Questions About Process Servers.

Sources

1. Often considered being ‘thrifts’

2. According to the Fortune 500, in 2018, Fannie Mae was rated 21st in total revenue among the biggest United States companies since being founded in 1938 during the Great Depression as part of the New Deal.

3. Which is often known as FHLMC

4. Fabozzi, Frank J.; Modigliani, Franco (1992), Mortgage and Mortgage-backed Securities Markets, Harvard Business School Press, p. 2, ISBN 0-87584-322-0

5. Adjustable-rate mortgages are sometimes confused with balloon payment mortgages. The distinction is that a balloon payment may require refinancing or repayment at the end of the period; some adjustable rate mortgages do not need to be refinanced, and the interest rate is automatically adjusted at the end of the applicable period. Some countries do not allow balloon payment mortgages for residential housing: the lender then must continue the loan (the reset option is required). For the borrower, therefore, there is no risk that the lender will refuse to refinance or continue the loan.

6. The final payment is called a balloon payment because of its large size.

7. Alford, Rob. ‘What Are the Origins of Freddie Mac and Fannie Mae?’ History News Network, hnn.us/articles/1849.html. 

8. ‘12 U.S. Code Chapter 13, Subchapter III – NATIONAL MORTGAGE ASSOCIATIONS | LII / Legal Information Institute’.

9. “Desktop Underwriter & Desktop Originator.” Desktop Underwriter & Desktop Originator | Fannie Mae, singlefamily.fanniemae.com/applications-technology/desktop-underwriter-desktop-originator. 

10. In early 2008, the decision was taken to enable mortgage-backed securities eligible for TBA (To-be-announced) to include up to 10% ‘jumbo’ loans.

11. “Get Started Here:” Conforming Loan Limits | Federal Housing Finance Agency, www.fhfa.gov/DataTools/Downloads/Pages/Conforming-Loan-Limits.aspx. 

12. Indeed, in 2008, with virtually no market for non-GSE-guaranteed bonds, non-conforming loans were priced roughly 1% to 1% higher than conforming loans.

13. Duhigg, Charles. ‘Loan-Agency Woes Swell from a Trickle to a Torrent.’ The New York Times, The New York Times, 11 July 2008, www.nytimes.com/2008/07/11/business/11ripple.html?ex=1373515200&en=8ad220403fcfdf6e&ei=5124&partner=permalink&exprod=permalink. 

14. According to Vernon L. Smith, winner of the Sveriges Riksbank Prize in Economic Sciences, FHLMC and FNMA are ‘implicitly taxpayer-backed organizations.’ The Economist has referred to FHLMC and FNMA’s ‘hidden government guarantee’. Alan Greenspan said in testimony before the House and Senate Banking Committees in 2004 that Fannie Mae’s (poor) financial condition was a consequence of markets thinking that the US Government would never allow Fannie Mae (or Freddie Mac) to collapse.

15.  Section 2(a) of the Act of May 9, 1956 (Pub. L. No. 511; 70 Stat. 133

16.  Investment Company Institute v. Camp, 401 U.S. 617 (1971

17. A real estate mortgage investment conduit (REMIC) is “an entity that holds a fixed pool of mortgages and issues multiple classes of interests in itself to investors” under U.S. Federal income tax law and is “treated like a partnership for Federal income tax purposes with its income passed through to its interest holders

18. Duarte, Jefferson, and Douglas A. McManus. ‘Residential Mortgage Credit Derivatives.’ Real Estate Economics, vol. 39, no. 4, 2011, pp. 671–700., doi:10.1111/j.1540-6229.2011.00309.x.

19. The Standard Industrial Classification is a system for classifying industries by a four-digit code. Established in the United States in 1937, it is used by government agencies to classify industry areas.

20. MIDTOWN CENTER
1100 15TH ST, NW

WASHINGTON DC 20005

21. MIDTOWN CENTER

1100 15TH ST, NW

WASHINGTON

DC

20005

22. Sinnock, Bonnie. “Fannie Mae, Freddie Mac Give Consumers an Edge in Foreclosure Sales.” National Mortgage News, National Mortgage News, 2 Sept. 2021, www.nationalmortgagenews.com/news/fannie-mae-freddie-mac-give-consumers-an-edge-in-foreclosure-sales. 

HOW TO SERVE LEGAL PAPERS ON APPLE

Apple

Undisputed Legal | California Process Service

Apple made history on August 2nd, 2018, when it was the first publicly listed American corporation to have a market capitalization of USD1 trillion.   Again in 2020, the firm surpassed milestones by becoming the first business in the United States to achieve a two trillion dollar market value. 

Apple is a global consumer electronics business, well known for its computers and operating systems. Apple is the most valuable corporation in the world at the moment. It is also the world’s biggest technological business. By 2021, Apple is now the fourth-largest producer of personal computers in the world, as well as the fourth-largest smartphone maker.   It is one of the major American IT firms, and with Amazon, Google, Microsoft, and Facebook, one of the Big Five. . Apple is among the top corporate entities in the world, having been rated highly for at least a few years now.  After then, it held on to the number one position for years.

BACKGROUND

Apple’s first goal was to build and market the Wozniak’s Apple I, a personal computer developed by Steve Jobs, Steve Wozniak, and Ronald Wayne in 1976. In 1977, Jobs and Wozniak formed Apple Computer, Inc., which expanded rapidly because of the sales of their computers, including the Apple II. It received a massive influx of cash the moment it became public in 1980. Within the following several years, Apple began releasing computers that had ground-breaking graphical user interfaces (GUIs), such as the Macintosh, which was introduced with the legendary 1984 commercial. Even yet, issues emerged as the company’s high prices made it difficult to get customers, the restricted app library made it challenging for developers, and power conflicts within the organization created more headaches. In 1985, Wozniak and Jobs went their own ways: Wozniak left Apple, while Jobs left to establish NeXT, bringing several of his colleagues with him.

Microsoft’s operating system and Intel’s processors came to dominate the computer industry as the 1990s wore on, causing Apple to lose huge amounts of market share. During his five hundred-day tenure, CEO Gil Amelio implemented significant changes, improved the company’s product focus, and performed many layoffs to better prepare Apple for success. NeXT was purchased by Amelio in 1997 to address Apple’s disastrous operating system strategy, as well as to bring back Steve Jobs, who succeeded Amelio as CEO in the same year. Under the reinvigorated “Think Different” campaign, Apple returned to profitability by releasing the iMac and iPod, setting up Apple Stores all over the world, and purchasing a variety of businesses to diversify their software portfolio. The iPhone was met with both rave reviews and commercial success when it debuted in 2007. Shortly after his resignation due to illness, he died. After he passed away, Tim Cook became the CEO.

LEGAL CONCERNS FOR APPLE

Apple has established subsidiaries in Ireland, the Netherlands, Luxembourg, and the British Virgin Islands as well as much other tax havens to help it reduce the taxes it pays in other countries. According to The New York Times, Apple, in the 1980s, was one of the first technology firms to create an international sales team that circumvented higher taxes in other nations by selling goods for lower-taxed subsidiaries on other continents. In the late 1980s, Apple was a forerunner of the “Double Irish with a Dutch sandwich” tax evasion method, which uses Irish companies and the Netherlands as a middleman to route earnings via the Caribbean.

Epic Games has launched a lawsuit against Apple and Google on the basis of antitrust breaches and anti-competitive conduct. The lawsuit was filed on August 13, 2020, centering around Apple’s (and Google’s) near unfettered use of the App Store. The September 2021 ruling was in favor of Apple, Judge Yvonne Gonzalez Rogers deciding in favor of Apple on nine of ten counts.

Epic had released a new payment option in Fortnite Battle Royale that allows players to buy microtransactions directly from Epic with a substantial discount. Epic had long contested the thirty percent revenue share that digital storefronts (such as Apple, Google, and Amazon) demand, and introduced the payment option that day. The companies pulled the Fortnite app instantly after finding out that the software broke their rules by directly skipping their App Store payment mechanism. Epic went on to sue both businesses once they took the game down. California’s anti-competition statutes found that Apple breached its anti-competition rules with Apple’s anti-steering clause. The court issued a final order against Apple that forbade them from prohibiting app developers from adding third-party payment links in their software, as well as forbade them from gathering data on their customers to announce other methods of payment inside the apps.

APPLE SUBSIDIARIES

APPLE INC. 

Apple Inc. is a Californian domestic stock business company with the first filing on 3rd January 1977 and does come under the jurisdiction of California. The entity retains an address in Cupertino, California, and has retained CT Corporation System as a registered agent. 

On April 1st, 1976, Steve Jobs, Steve Wozniak, and Ronald Wayne started a company together, which was dubbed Apple Computer.  Wozniak single-handedly created the Apple I, the company’s first and original product.  In July 1976, Wozniak showed off the first prototype to the Homebrew Computer Club.  The Apple I was advertised as a motherboard with CPU, RAM, and other basic components such as video chips—not as a whole personal computer, but as a “kit” that allowed customers to build their own computer if they chose to. 

Apple Inc. was established on January 3rd, 1977, twelve days after Wayne, one of the founders, departed from the business, selling his stake to Steve Jobs and Steve Wozniak for USD 800.

APPLE COMPUTER, INC.

Apple Computer, Inc. is a Californian domestic stock business company that has its first filing on June 20th, 1968, falling under the jurisdiction of California. The entity retains CT Corporation System as a registered agent for California Process Service. 

A business entity can be formed in California by filing the applicable document or form (as described below) with the Secretary of State. It is thus necessary to file Articles of Incorporation and the forms must have been drafted to meet the minimum statutory and California Process Service requirements.

The company has to first qualify or register with the California Secretary of State prior to conducting intrastate business in California. California Corporations Code defines intrastate transactions as recurring and consecutive transactions of its activities in that state other than international or foreign trade.  It should be noted that a foreign corporation shall not be considered to be transacting intrastate business merely because its subsidiary transacts intrastate business. Once the business entity is formed or registered with the California Secretary of State it must obtain the necessary licenses and permits according to California Process Service requisites. However, the Secretary of State does not issue licenses or permits for business entities.

 A Statement of Information is due every year beginning five months before and through the end of January for purposes of California Process Service. The Office of the Secretary of State cannot advise the entity whether the company has to qualify or register in California to do business.

BEATS ELECTRONICS LLC

Beats Electronics LLC (commonly known as Beats by Dr. Dre, or just Beats by Dre) is an American consumer audio goods company based in Culver City, California. They specialize in items related to both the design and the engineering of headphones and other personal audio equipment. Dr. Dre and Jimmy Iovine created the record label and music production business, respectively, Since 2014, it has been an Apple subsidiary.

The entity has a product range with headphones and speakers at its core. Originally, the equipment business Monster Cable Products was partnered with the company in the production of its product range. After the contract with the business ended, Beats chose to bring future product development in-house. Beats Music, a subscription-based streaming service, was launched in 2014 to open up the company’s operations to the internet music industry. A Statement of Information is due every even-numbered year beginning five months before and through the end of June.

Apple has purchased Beats Electronics for over three billion dollars. Dr. Dre and Jimmy Iovine, a music producer and a record executive, respectively, established Beats Electronics in 2006. The company launched its first headphones in 2008. Apple has been able to sell Beats headphones via retail shops and resellers courtesy of the purchase. Beats was an independent business at the time of its purchase with minority owners, including Dr. Dre, Iovine, and the Carlyle Group. Currently, Beats Electronics LLC retains Registered Agents Inc as a Registered Agent for California Process Service.

Apple used some Beats Music components to create its Apple Music streaming service. Beats Music, which closed down in 2015, has its subscribers going to Apple now. Apple has focused on incorporating Beats Electronics goods, including Beats-branded headphones, earphones, and speakers, into its portfolio.

SIRI

Siri, an artificial intelligence (AI) in Apple’s operating systems,  is highly popular in its capacity to provide answers, suggestions, and actions, the assistant utilizes voice inquiries, gesture-based control, focus-tracking, and a natural language user interface. The program adjusts to the different habits of the user, improving the search and highlighting features over time. Each response is tailored.

Siri was initially created by the SRI International Artificial Intelligence Center, which spun her out as a project. Siri, Apple’s digital assistant, is built with sophisticated learning technology, using Nuance Communications’ voice recognition technology.  Apple bought the voice assistant two months after it launched as an app for iOS in February 2010. When the iPhone 4S came out in October 2011, Siri was added to it. The app was pulled from the App Store after that happened. In addition to appearing in many Apple products, the virtual assistant has also been incorporated into new hardware.

SRI International Artificial Intelligence Center joined Nuance Communications (a firm dedicated to voice technology) as partners to assist in the development of Siri. Siri, SRI International’s research and development department, has been a wholly autonomous organization since 2008.   Siri began out as a standalone software meant to be used for daily things like making appointments, finding weather updates, and obtaining tickets to games.  Apple included voice activation right into the first few iterations of the iPhone. Siri is available on all of Apple’s products: the iPhone, Apple Watch, Macs, Apple TV, and even the Apple Watch. Siri, reflecting Apple’s approach of buying a tech firm and then incorporating its particular technology into their current products, symbolizes Apple’s philosophy of buying another company and combining its technology with Apple’s existing product line. A Statement of Information is due every even-numbered year beginning five months before and through the end of November for California Process Service.

SHAZAM

Shazam Entertainment Limited, the business that started in 1999, developed the first Shazam app, whose name and logo both reference the same. In 2018, Apple finalized the USD 400 million deal to acquire Shazam, whose technology they want to use to enhance iPhones and other software. Shazam is an app that recognizes songs, movies, advertisements, and TV programs via brief clips from the device’s microphone.   Shazam Entertainment, headquartered in London, developed it, and Apple Inc. has owned it since 2018. This program is accessible for all five of the major platforms,  Android, macOS, iOS, Wear OS, and watchOS.

The business was purchased by Apple on September 24th, 2018. Previously, the entity fell under English jurisdiction, having registered with the California Department of State on 9th November 2001 as a foreign Stock company for purposes of California Process Service. As such the principal office of the entity was in the United Kingdom. 

Shazam’s music identification was considered to be more robust than Siri’s, even though Apple already had technology similar to Shazam’s in Siri. The organization said that it would no longer depend on ad-supported income and would instead fund operations using money from sales of music downloaded through the app.

APPLECARE SERVICE COMPANY, INC.

Apple’s extended warranty and technical assistance programs are known as AppleCare+. Devices come with a year-long warranty and ninety days of technical assistance, both of which are extended with AppleCare+. Additionally, it provides a reduced rate on accidental damage repair twice a year. Apple’s AppleCare Protection Plan offers protection for several of their products including Mac computers and displays, Beats headphones, HomePods, iPhones and iPods, Apple Watches, and Apple TVs. Apple’s coverage includes software linked with personal gear, and it comes with their insurance. It’s possible to purchase more assistance and training via AppleCare.

Every Apple product, including phones, offers at least telephone technical assistance and a guarantee to its owners. The AppleCare Protection Plan and AppleCare+ provide extensive service coverage and the ability to get Apple specialists’ assistance in one place.

In some parts of European countries a part of the European Union (EU), local regulations give consumers a minimum of two years warranty on hardware defects that existed at the time of purchase, which overlaps the benefits of AppleCare. Essentially, the onus of responsibility in the EU falls upon the merchant rather than the customer to prove that a hardware defect did not exist at the time of purchase for the first six months after purchase. 

Applecare Service Company is a Foreign Stock Corporation for purposes of California Process Service. The entity registered with the Department of State on 9th October 2007, although CT Corporation System is its registered agent for California Process Service. However, the entity still retains the Principal Apple office as the center for California Process Service of most important documents.  A Statement of Information is due every year beginning five months before and through the end of October for purposes of California Process Service.

BRAEBURN CAPITAL

Braeburn Capital, Inc. is an independent hedge fund manager headquartered in Reno, Nevada. The firm was founded in 2006 and they are principally owned by Apple, Inc. (NASDAQ: AAPL). Braeburn Capital manages the assets of its parent company since Apple created the company on October 3rd, 2005 to better manage its assets and to avoid certain California state taxes and taxes from other U.S. states totaling millions of dollars

Investing in Apple is more than purchasing shares in a trillion-dollar technological firm. The individual will be buying into one of the world’s biggest investment firms: Braeburn Capital, a subsidiary of Apple. Apple’s USD 244 billion financial portfolios is under Braeburn’s management, making about over half of Apple’s total book assets. Apple uses Braeburn to deal with the debt to finance its portfolio to the tune of USD 115 billion.

Apple follows the hedge fund model and offers little information about Braeburn Capital’s portfolio holdings.  Braeburn Capital Inc is a corporation that is registered in Nevada, having been active from 3rd October 2005. The entity has CT Corporation System as its registered agent for Process Service, which fulfills this responsibility as a Commercial Registered Agent for California Process Service. However, California Process Service may also be done on the Principal Office of the entity within the state or even levied upon the authorized officers of the company.

Currently, Apple is very popular, with brand loyalty at an all-time high, and it is the most valuable brand in the world. In fact, as of 2021, there are close to two billion Apple devices in use globally.  A major center for discourse, however, has been about corporate ethics, namely the kinds of unethical activities several contractors engage in, including price-fixing and low-wage labor exploitation.

For more information on serving legal papers, contact Undisputed Legal our California Process Service department at (800) 774-6922. Representatives are available Monday-Friday 8 am – 8 pm EST.  If you found this article helpful, please consider donating.  Thank you for following our blog, A space dedicated to bringing you news on breaking legal developments, interesting articles for law professionals, and educational material for all. We hope that you enjoy your time on our blog and revisit us!  We also invite you to check out our Frequently Asked Questions About Process Servers.

Sources

1. The judge, regards Apple’s anti-steering policies, prohibited Apple from stopping developers from informing users of other payment systems within apps.

2. Entity Address:

ONE APPLE PARKWAY
CUPERTINO CA 95014

3. Entity Mailing Address:

ONE APPLE PARKWAY
CUPERTINO CA 95014

4. Entity Address:

ONE APPLE PARKWAY
CUPERTINO CA 95104

Entity Mailing Address:

ONE APPLE PARKWAY
CUPERTINO CA 95104

5. Required Articles of Incorporation:

    • Articles of Incorporation of a General Stock Corporation (Form ARTS–GS)
    • Articles of Incorporation of a Close Corporation (Form ARTS–CL)
    • Articles of Incorporation of a Professional Corporation (Form ARTS–PC)
    • Articles of Incorporation of a Nonprofit Mutual Benefit Corporation (Form ARTS–MU)
    • Articles of Incorporation of a Nonprofit Public Benefit Corporation (Form ARTS–PB–501(c)(3))
    • Articles of Incorporation of a Nonprofit Religious Corporation (Form ARTS–RE)
    • Articles of Incorporation of a Common Interest Development Association (Form ARTS–CID)

6. Entity Address:

1164 ALLEN AVE APT 6
GLENDALE CA 91201

Entity Mailing Address:

1164 ALLEN AVE APT 6
GLENDALE CA 91201

7. Entity Address:

1401 21ST ST., SUITE R
SACRAMENTO CA 95811

Entity Mailing Address:

1401 21ST ST., SUITE R
SACRAMENTO CA 95811

8. 333 RAVENSWOOD AVE
MENLO PARK CA 94025

Entity Mailing Address:

333 RAVENSWOOD AVE
MENLO PARK CA 94025

9. The official name of the entity is SHAZAM ENTERTAINMENT LIMITED WHICH WILL DO BUSINESS IN CALIFORNIA AS: U K SHAZAM ENTERTAINMENT LIMITED

10. Agent for Service of Process:

AVERY WANG
165 UNIVERSITY AVENUE, SUITE #6
PALO ALTO CA 94063

11. Entity Address:

26-28 HAMMERSMITH GROVE
LONDON UNITED KINGDOM W6 7HA

Entity Mailing Address:

26-28 HAMMERSMITH GROVE
LONDON UNITED KINGDOM W6 7HA

12. Entity Address:

ONE APPLE PARKWAY
CUPERTINO CA 95104

Entity Mailing Address:

ONE APPLE PARKWAY
CUPERTINO CA 95104

13. Street Address:

701 S CARSON ST STE 200, Carson City, NV, 89701, USA

14. President: Michael Shapiro 6900 S. McCarran Blvd,Ste 3020, Reno, NV, 89509, USA

Secretary: Sam Whittington 6900 S. McCarran Blvd,Ste 3020, Reno, NV, 89509, USA

Treasurer: Gary Wipfler 6900 S. McCarran Blvd,Ste 3020, Reno, NV, 89509, USA

Director: Luca Maestri 6900 S. McCarran Blvd,Ste 3020, Reno, NV, 89509, USA

Director: Matt Miller 6900 S. McCarran Blvd,Ste 3020, Reno, NV, 89509, USA

HOW TO SERVE LEGAL PAPERS ON UNITEDHEALTH GROUP INCORPORATED

UnitedHealth Group

Undisputed Legal | Process Service

UnitedHealth Group, a U.S.-based, global health- and insurance-management business headquartered in Minnetonka, Minnesota, was founded in 1979. The entity provides a variety of health care goods and insurance policies. A majority of the organisation’s total revenue comes from UnitedHealthcare’s earnings.

With around a hundred and fifty million clients, UnitedHealth Group is mostly an insurance-centred organisation. UnitedHealthcare is UnitedHealth Group’s benefit subsidiary, and it also includes three different departments: OptumRx, a mail-order pharmacy, OptumHealth, which has an HSA and OptumInsight, a payment processor.

HOW DOES UNITEDHEALTHCARE WORK

UnitedHealth Group has undergone several transformations since it was founded in 1974 as Charter Med Incorporated. In the early 1980s, it became United HealthCare Corporation, and subsequently changed its name to what it is today. UnitedHealth Group, known for being one of the world’s largest health insurers, recently bought the Patients Like Me online patient platform for an undisclosed sum. The entity has completed many other purchases throughout their history, which has helped them rise to their current position as one of the leading insurers in the world.

UnitedHealthcare offers commercial group insurance plans across the United States under several product names with different offerings, primarily [A.]  UnitedHealthcare Select which works as an exclusive provider organization (EPO) with no coverage for out-of-network providers, [B.] UnitedHealthcare Select Plus in its capacity as a preferred provider organization (PPO);[C.] UnitedHealthcare Choice functioning as a HMO plan with access to specialists, whereas UnitedHealthcare Choice Plus is an HMO which allows for out-of-network coverage and[D.] UnitedHealthcare Navigate, Charter, and Compass which would require a primary care physician referral to see a specialist, causing more restrictive managed care plans, similar to point of service plans. UnitedHealth Group’s income is made up of several sources, including risk-based plan premiums, fees for services, product sales, and healthcare service and investment revenue.

UnitedHealthcare concludes contract negotiations with suppliers on a quarterly basis, and they sometimes end contracts.  If the circumstances are right, a single legal contract disagreement may have significant consequences for all branches involved in a case such as that of Envision Healthcare, a provider network whose medical service providers were contracted out to countless individual doctors and their offices.

HOW UNITEDHEALTHCARE’S INSURANCE IS STRUCTURED

In order to avoid penalties, insurance companies must have up-to-date provider directories so that Centres for Medicare and Medicaid Services can see that the insurer is following all regulations. UnitedHealthcare compels providers to apprise them of changes, but also utilise tools that contacts providers proactively to find out about any changes. Providers, however, are overwhelmed by the challenge of keeping their information up to date in many networks, particularly to competitors to UnitedHealthcare. Consequently, a blockchain project that started in 2018 has been implemented to spread the directory’s costs among several groups. 

With UnitedHealth Group’s Premiums Business Co-pays, the individual gets every insurance service the insurer provides. In 2017, the firm brought in more than sixty billion in premiums from Medicare and retirement customers, with senior care being one of UnitedHealthcare’s biggest sectors. Premium income then follows in the form of employer and individual plans.  Other goods and services offered by UnitedHealth Group include anything from healthcare instruments and equipment to consultancy and tech solutions. Most of these are supplied by means of independent contractors, direct sales, or agents with a volume discount.

UNITEDHEALTH GROUP AND OPTUM

UnitedHealth Group’s secondary money-maker is its Optum Business Insurance division, which is  growing in prominence. The Optum group, however, operates as a vigorous and essential part of the organisation. OptumHealth delivers healthcare, interaction with customers, and additional offerings including healthcare finance. OptumInsight concentrates on the largest players in the healthcare sector, where it offers services including knowledge, technology, and other support. OptumRx is a pharmaceutical care service, providing pharmacy benefits and services to employers. UnitedHealth Company has operations spanning more than a hundred and fifty countries in North America, South America, Europe, Asia Pacific, and the Middle East. This includes Optum, which is a pharmaceutical benefit manager and health care services group. UnitedHealth Group created the Optum brand in 2011 to unify three of its major enterprises: [A.] OptumHealth, [B.] OptumInsight, and [C.] OptumRx. 

The Optum trade secrets lawsuit garnered a significant amount of media attention in early 2019, when the company filed the lawsuit against former executive David William Smith, who had previously worked for Optum and had just gone to work for Haven, the joint healthcare venture created by Amazon, JPMorgan Chase, and Berkshire Hathaway. Optum, who are headquartered in Eden Prairie, Minnesota, specialises in pharmacy benefits and other wellness services.

UNITED HEALTH GROUP INC

The United Health Group Inc was established with the Department of State of New York, having its initial filing completed on March 18th, 1999 . The entity is entirely New York-based, filing for incorporation in New York County for the purposes of Minnesota Process Service.

A New York-based United Health Group Inc is wholly subject to the regulations of New York City Process Service, is a domestic business entity for legal purposes. The steps required to incorporate a company are outlined in the section of the Business Corporation Law pertaining to incorporating business corporations. Additionally, the organisation does not have a registered agent, thus when the Secretary of State is served, Minnesota Process Service is frequently  considered to be completed. The Department of State  will then ship a copy of the process to the company with a certified mail with the specified address to United Health Group Inc made available while giving the Certificate of Incorporation, which is on file with the other United Health Group Inc documents in the Department of State

UNITEDHEALTH GROUP FINANCE COMPANY, INC.

UnitedHealth Group Finance Company, Inc. is a wholly owned subsidiary of UnitedHealth Group, Inc.,. UnitedHealth Group is a major American health insurer, supplying group and individual clients all across the country with various policies and services. It provides health insurance services through its UnitedHealthcare benefits division, which has in place HMO, PPO, and POS programmes, and its UnitedHealthcare Medicare, Medicaid, state-funded, and supplementary dental and vision coverage choices. And Optum Health Services, which consists of OptumHealth, OptumInsight, and OptumRx, offers a multitude of products and services to both the public and the healthcare industry, which include medical, wellness, and care management programmes, financial services, information technology solutions, and pharmacy benefit management (PBM) services.

The company was incorporated on 17th  February, 2000 in Delaware. Consequently, the entity is a General Corporation with jurisdiction of the State of Delaware itself, since the county of incorporation was New Castle. The company retains Corporation Trust Corporation System as a registered agent for Minnesota Process Service.  

UNITEDHEALTHCARE OF NEW YORK, INC.

The Department of State of New York established the UnitedHealthcare Of New York, Inc. on July 10th, 1986, when its first filing was completed. For Process Service in the New York City area, the organisation has filed for incorporation in New York County.

The Minnesota Process Service may issue subpoenas and orders to a domestic company called UnitedHealthcare of New York, Inc., which is a subsidiary of the national UnitedHealth Group Inc. The procedures for creating a business corporation are included in the part of the Business Corporation Law discussing how to set up such an organisation. Furthermore, the lack of an appointed agent means that the Secretary of State considers the process to be complete once they serve it according to Process Service regulations. The State Department will then send a certified certificate of incorporation to UnitedHealthcare of New York, Inc., complete with the certified mail service. UnitedHealthcare of New York, Inc.,. retains CT corporation system as its registered agent for Process Service, which means that CT Corporation System will receive the Process Service rather than the documents being directed to the New York Secretary of State. The entity, however, still retains a principal office wherein service of process may be provided by mail or by personal Process Service, with the higher officers or other authorities being empowered to accept the Process Service accordingly. 

UNITEDHEALTH GROUP INCORPORATED

The company was incorporated in Delaware for purposes of Minnesota Process Service. The initial filing itself was done on July 1st, 2015, ensuring that  UnitedHealth Group Incorporated was classified as a General Corporation. It should be noted that since this filing was done in Delaware, the jurisdiction of UnitedHealth Group Incorporated  falls under the State of Delaware, since the county of incorporation was New Castle. The company retains Corporation Trust Corporation System as a registered agent for Minnesota Process Service.

On July 1st, 2015, UnitedHealth Group Incorporated essentially changed its state of incorporation from Minnesota to Delaware pursuant to a plan of conversion. The reincorporation was approved by the Company’s stockholders at its 2015 Annual Meeting of Shareholders held on June 1, 2015. Upon reincorporation, the affairs of UnitedHealth Group Incorporated became subject to the Delaware General Corporation Law, a new certificate of incorporation and new bylaws, and each previously outstanding share of UnitedHealth Group Incorporated’s common stock as a Minnesota corporation (UNH Minnesota) converted into an outstanding share of common stock of UnitedHealth Group Incorporated as a Delaware corporation after the reincorporation (UNH Delaware). The reincorporation was a tax-free reorganization under the U.S. Internal Revenue Code and was purported to not affect the Company’s business operations.

UNITEDHEALTH GROUP INTERNATIONAL FINANCE, LLC

UnitedHealth Group International Finance, LLC is a broker-dealer regulated by the U.S. Security and Exchange Commission and incorporated in the state of Delaware.  The entity filed for incorporation on 6th  September, 2019. The entity retains Corporation Trust Company as a registered agent for Minnesota Process Service. 

UNITEDHEALTH GROUP INTERNATIONAL HOLDINGS I INC

UnitedHealth Group International Holdings Inc is a Domestic General Corporation registered as such in Delaware, where it was incorporated on 6th September, 2019. Like other UnitedHealth Group entities,  UnitedHealth Group International Holdings I Inc retains Corporation Trust Company as its registered agent for Minnesota Process Service. However,  UnitedHealth Group International Holdings Inc and other  UnitedHealth Group entities retain their principal address for their offices in the state of incorporation, with an office in Wilmington Delaware in New Castle County.

UNITEDHEALTH GROUP INTERNATIONAL LLC

UnitedHealth Group International, LLC is a subsidiary of the UnitedHealth Group and filed for incorporation with the Department of State on June 21st , 2000 in the county of New Castle. The entity itself is classified as a General Limited Liability Company that falls under Delaware jurisdiction for Minnesota Process Service guidelines to be used.  

Minnesota Process Service needs to be rendered on  the  Secretary  of State as agent of a domestic limited company. However,   UnitedHealth Group International, LLC retains a registered agent on record, such that Minnesota Process Service may be forwarded from the Department of State. Consequently, Process Service can be sufficiently done by  personally delivering to and leaving with Corporation Trust Company  duplicate  copies  of  any Process Service that might be authorised

UNITEDHEALTH GROUP VENTURES, LLC

UnitedHealth Group Ventures has made a high point of its continued working as its  development of a rigorous build-to-scale model to ensure that the market will support a scaled solution, designing sustainable businesses specifically to meet market needs.

UnitedHealth Group Ventures is a company owned by the UnitedHealth Group and located in New Castle County, Delaware. It was incorporated there on July 12th, 2012. The entity itself is a Delaware limited liability company, with the state’s Process Service rules applying.

A domestic limited liability company must have Process Service provided as the agency of that  limited liability company. Nevertheless, in addition to retaining a registered agent on record, UnitedHealth Group Ventures may have process service from the Department of State sent to the agent. Process Service may be adequately performed with Corporation Trust Company by physically providing copies of the Process Service that has been approved and picking up duplicate copies of what was delivered, which is the responsibility of the registered agent .

For more information on serving legal papers, contact Undisputed Legal our Process Service department at (800) 774-6922. Representatives are available Monday-Friday 8 am – 8 pm EST.  If you found this article helpful, please consider donating.  Thank you for following our blog, A space dedicated to bringing you news on breaking legal developments, interesting articles for law professionals, and educational material for all. We hope that you enjoy your time on our blog and revisit us!  We also invite you to check out our Frequently Asked Questions About Process Servers.

Sources

1. Graybow, Martha. “UPDATE 2-UNITEDHEALTH SETTLES New York Reimbursement Probe.” Reuters, Thomson Reuters, 13 Jan. 2009, www.reuters.com/article/unitedhealth/update-2-unitedhealth-settles-new-york-reimbursement-probe-idUSN1338639920090113. 

2. On August 4, 2017, Plaintiff Terry W. Bettis filed an initial complaint against Envision Healthcare Corporation and four individual defendants: William A. Sanger, Randel G. Owen,  Christopher A. Holden, and Claire M. Gulmi (Doc. No. 1). That initial complaint alleged violations of the Securities Act of 1933 (the “1933 Act”) and the Securities Exchange Act of 1934 (the “1934 Act”). (Id. ¶¶ 63-78). The case brought by Beattis was consolidated with two related cases: Carpenters Pension Fund of Illinois vEnvision Healthcare Corporation, Case No. 3:17-cv-01323 (M.D. Tenn., Sept. 29, 2017); and Central Laborers’ Pension Fund vEnvision Healthcare Corporation, Case No. 3:17-cv-01397 (M.D. Tenn., October 23, 2017).

3. Japsen, Bruce. “UnitedHealth Group to Expand Obamacare to Seven New States in 2022.” Forbes, Forbes Magazine, 2 Sept. 2021, www.forbes.com/sites/brucejapsen/2021/09/02/unitedhealth-to-expand-obamacare-to-seven-new-states-in-2022/. 

4. Japsen, Bruce. “Buying Binge For Unitedhealth’s Optum Is Only Just Beginning.” Forbes, Forbes Magazine, 19 Apr. 2018, www.forbes.com/sites/brucejapsen/2018/04/18/the-buying-binge-of-unitedhealths-optum-is-only-just-beginning/?sh=49d4d71f192d. 

5. Lawsuit against Haven

UnitedHealth Group (UHG) has filed a complaint with a U.S. District Judge Mark Wolf requesting that he exclude former Optum executive David William Smith from working at Haven (Smith’s new company) (the Amazon, JP Morgan and Berkshire-Hathaway joint-healthcare venture).

Optum claimed that Smith’s position as CEO of Haven was in direct competition with its company and was therefore a breach of the noncompete agreement that he signed as an Optum employee.   Smith requested that the court dispatch the case to confidential arbitration. Wolf granted Smith’s motion but denied Optum’s, resulting in arbitration procedures that may delay the court case.

The case garnered media attention as setting a precedent in trade secret litigation ahead of an anticipated wave of vertical integration in the healthcare industry and for uncovering previously unknown details about Haven.  The matter was particularly important because it illustrates the threats that pharmaceutical benefit managers think that they are under due to increased bipartisan pressure to reign in growing healthcare prices. A court ruled in favour of the Journal and the Washington Post, whose legal counsel then released Stoddard’s statements in support of Haven.

6. Optum’s three businesses, OptumRx, OptumHealth and OptumInsight focuses on five core capabilities: data and analytics, pharmacy care services, population health, healthcare delivery and healthcare operation

7.CORPORATE FILINGS OF NEW YORK

Address:90 STATE STREET, STE 700, OFFICE 40, ALBANY, NY, 12207

8.GRIFFIN MICHAEL

Address:914 3RD AVE, STE #126, BROOKLYN, NY, United States, 11232

9. THE CORPORATION TRUST COMPANY

CORPORATION TRUST CENTER 1209 ORANGE ST

WILMINGTON County:

DE Postal Code:

302-658-7581

10. :C T CORPORATION SYSTEM

Address:28 LIBERTY ST., NEW YORK, NY, 10005

11. UNITEDHEALTHCARE OF NEW YORK, INC.

Address:111 8TH AVE, NEW YORK, NY, United States, 10011

12. Chief Executive Officer’s Name and Address

Name:PASQUALE HUGO CELLI

Address:77 WATER STREET, 14TH FLOOR, NEW YORK, NY, United States, 10005

13. THE CORPORATION TRUST COMPANY

CORPORATION TRUST CENTER 1209 ORANGE ST

WILMINGTON County:

DE Postal Code:

302-658-7581

14. Name: THE CORPORATION TRUST COMPANY

Address: CORPORATION TRUST CENTER 1209 ORANGE ST

City: WILMINGTON County: New Castle

State: DE Postal Code: 19801

Phone: 302-658-7581

HOW TO SERVE LEGAL PAPERS ON CREDIT SUISSE

Credit Suisse

Undisputed Legal | Albany New York Process Service

Credit Suisse Group AG is a multinational investment bank with bases in Switzerland and over two thousand locations throughout the world. It has headquarters in Zurich and is one of the nine worldwide Bulge Bracket’ banks offering services for investment banks, private banking, asset management, and shared services in all major financial cities across the globe, being recognized by the  Financial Stability Board as a systemically important bank. Credit Suisse is recognized for having very stringent privacy measures, which include customer and bank secrecy. 

HISTORY OF CREDIT SUISSE

Credit Suisse was established in 1856 to help Switzerland build its railroad network. It helped build Switzerland’s electricity grid and the European train infrastructure with the loans it provided. In 1978, Credit Suisse began working with First Boston. The firm acquired several firms between 1990 and 2000, including Winterthur Group, Swiss Volksbank, Swiss American Securities Inc. (SASI), and Bank Leu, expanding its market dominance via these acquisitions

The business went through several reorganizations in 2002, 2004, and 2006. During the Great Recession, it was among the less-affected banks, but after doing a few rounds of layoffs and reducing expenses, the bank started to exit the investment sector. 

HOW IS CREDIT SUISSE STRUCTURED

Credit Suisse Group AG, which is incorporated in Zürich and functions as a holding company, is structured as a joint-stock corporation. It has banking and other financial services interests, such as Credit Suisse and many other institutions. Credit Suisse’s board, shareholders, and independent auditors control the bank. Shareholders, who have a significant interest in the business, are required to drive the annual shareholders’ meeting, whereas the board is responsible conduct it. The company’s shareholders, who elect auditors for one-year periods and give them the authority to approve the annual report and other financial accounts, have additional legal authorities given to them. Shareholders nominate and elect board members for three-year terms, while the Board of Directors meets six times a year to vote on corporate issues.  The Board has responsibility for deciding Credit Suisse’s business strategy, although they may rely on the pay committee for assistance in setting the compensation guidelines. It has the ability to additionally form committees that are assigned the responsibility for management tasks.

Credit Suisse has two business groups: [A.] Wealth Management and [B.]  Investment Banking, with Private Banking as a tertiary group. A shared services department is responsible for ensuring all business units have access to the essential support functions including risk management, legal, IT, and marketing. Credit Suisse Private Banking includes corporate and institutional operations in addition to wealth management. The Investment Banking department of Credit Suisse provides services that include securities, investment research, trading, prime brokerage, and capital procurement. Credit Suisse Asset Management offers an array of financial products including stocks, fixed income products, real estate, and alternative investments.

MAJOR CREDIT SUISSE SCHEMES

Credit Suisse has lent its support to Bancassurance, a plan in which it hopes to become a single business that provides every basic financial service.  Bancassurance is highly exclusive in nature, reserved for businesses and high-net-worth people with more than fifty thousand euro. Credit Suisse’s CreditRisk+ methodology for measuring loan risk is built entirely on the Poisson probability technique for measuring the likelihood of default.

As of 2002, Credit Suisse brought in a little over a quarter of its revenues from the insurance business acquired when it bought Winterthur in 1997. The investment bank’s insurance products are successful in the domestic market because they cover several kinds of risks, including car, fire, property, life, disability, pension, and retirement.  Historically, private banking services have brought in 20–40% of the bank’s income, which was among its most profitable sectors.

A Credit Suisse hedge fund is one of the six running indexes of European stock markets.

HOW DOES CREDIT SUISSE WORK AS AN INVESTMENT BANK 

Credit Suisse’s investment managers prefer companies in the financial, technology, and energy sectors. Investment Banks, among other services, provide advice and play a role in investments and trade by aiding new stock issues, managing mergers and acquisitions, and underwriting new stock issues.

In addition to asset management for big investment funds and personal wealth management for high-net-worth people, investment banks play a variety of other functions. Credit Suisse, JPMorgan Chase, and Goldman Sachs are some of the big names on Wall Street.

Investment banks serve as middlemen for corporate bond issuance, seeking investors for corporate debt. Investing also goes beyond the distribution of securities, in that an investment bank offers pre-underwriting guidance and support once they are sold. In addition, the firm will go over the organization’s financial records for the correctness and issue a prospectus describing the deal to potential investors prior to selling the securities.

Corporate customers of investment banks include pension funds, other financial institutions, governments, hedge funds, and all other investors. The biggest banks often provide the finest investment banking services. The more ties the bank has with the market, the more it will earn. Big banks with customers throughout the world are some of the biggest investment institutions.

Mismarking

In 2007, two Credit Suisse traders pled guilty to mismarking their securities holdings in order to minimize losses and boost their year-end bonuses. Prosecutors and the Securities and Exchange Commission claimed that the traders’ objective was to earn extravagant year-end bonuses as a result of the mismarking. The traders were involved in what The New York Times described as a blatant plan to fraudulently inflate the price of bonds on their books in order to generate fake profits.’

Faced with an investigation by Credit Suisse’s internal controls Price Testing department, a team of traders justified the inflated value of their bond portfolio by getting ‘independent’ evaluations from other banks’ trading desks. The traders obtained phony ‘independent’ marks for illiquid assets in which they had positions from associates at other financial companies. Their buddies produced values for a variety of bonds at the prices desired by the traders, which the traders then recorded as the bonds’ actual worth. In this instance, the bank was not prosecuted. The mismarkings were found during an examination by Credit Suisse’s independent auditor. Credit Suisse recorded a $2.65 billion charge for mismarking by traders.

CREDIT SUISSE AF TRUST

Credit Suisse AF Trust is a Statutory Trust incorporated in the State of Delaware, rendering it to be classified as a foreign trust by Albany County New York Process Service requirements. The entity was incorporated in Delaware on 9th May 2008, with Wells Fargo Delaware Trust Company recorded as the registered agent for Albany County New York Process Service. Considering that the registered agent requires to have an address in the state of incorporation, Wells Fargo Delaware Trust Company retains its office in Wilmington, Delaware. The county for incorporation in New Castle in the state. 

Before doing business in the State of Delaware, a foreign statutory trust must register with the Secretary of State. This must include a copy executed by a trustee or other authorized person of an application for registration as a foreign statutory trust, which would require [A.] the name of the foreign statutory trust; [B.] the state, territory, possession, or other jurisdiction or country where the trust was formed, [C.] the nature of the business or purposes to be conducted; [D.] the address of the registered office and the name and address of the registered agent for service of process [E.] a statement that the Secretary of State is appointed the agent of the trust for service of process; and [F.] the date on which the foreign statutory trust conducts business.

CREDIT SUISSE AG

Credit Suisse AG  is a Foreign General Corporation according to Albany County New York Process Service, although it is also registered as a Foreign General Corporation in Delaware, where it was incorporated on 11th April 2011. Unlike Credit Suisse AF Trust, Credit Suisse AG retains Corporation Service Company as its registered agent for Albany County New York Process Service. However, similar to Credit Suisse AF Trust, Credit Suisse AG’s registered agent retains an address for Albany County New York Process Service in the state of incorporation, with an office in Wilmington Delaware in New Castle County.

CREDIT SUISSE ALTERNATIVE CAPITAL, LLC

Credit Suisse Alternative Capital, LLC is a limited liability company that was incorporated on 6th January 1994. Credit Suisse Asset Management, LLC is an indirect wholly-owned subsidiary of Credit Suisse Group AG, a publicly-owned foreign bank holding company based in  Switzerland.  The entity was incorporated in Delaware with Corporation Service Company as its registered agent for Albany County New York Process Service

To a foreign limited liability company in New York,  it is necessary to complete and file the Application for Authority with the Department of State, with an Application for Authority. Attached to the application, a Certificate of Existence from the official who files and maintains limited liability company records in the jurisdiction of the limited liability company will be required, with the certificate dated within one year.

The completed application, together with the filing fee of USD 250, should be forwarded to the New York Department of State, Division of Corporation.

CREDIT SUISSE AMERICAS FOUNDATION 

Credit Suisse Americas Foundation is a Foreign Corporation according to Albany County New York Process Service, although it is also registered as a General Corporation exempt from taxation in Delaware, where it was incorporated on 31st December 2010. Credit Suisse Americas Is a charitable organization that was incorporated relatively recently and the foundation supports organizations that engage Credit Suisse as well as creates educational opportunities for disadvantaged young people. The entity retains Corporation Service Company as its registered agent for Albany County New York Process Service. However, Credit Suisse Americas Foundation’s registered agent retains an address for Albany County New York Process Service in the state of incorporation, with an office in Wilmington Delaware in New Castle County

CREDIT SUISSE ASSET MANAGEMENT INCOME FUND

Credit Suisse Asset Management Income Fund, Inc. is a Foreign Corporation according to Albany County New York Process Service, with the entity itself falling under Maryland jurisdiction. The corporation was incorporated on 2nd June 1987 and is one of the earliest subsidiaries of the organization. Credit Suisse Asset Management Income Fund, Inc itself was registered and incorporated in New York, which rendered its registered agent for Albany County New York Process Service to be Credit Suisse Asset Mangaement LLC rather than Corporation Service Company like other Credit Suisse subsidiaries.  Albany County New York Process Service is also provided upon the Chief Executive Officer or any higher officer who is authorized to accept service of process. Additionally, Credit Suisse Asset Management Income Fund, Inc also retains First Boston Income Fund as its registered agent for New York County Process Service in addition to Credit Suisse Asset Management, wherein requisite documents are directed

CREDIT SUISSE ENERGY LLC

Credit Suisse Energy LLC is a foreign limited liability company for Albany County New York Process Service requirements. The entity first filed for incorporation with the New York Department of State on 1st February 2006 although the initial foreign formation date of the entity was on 26th October 2005. The entity thus falls under Delaware jurisdiction with Corporation Service Company being its registered agent for Albany County New York Process Service. Since the registered agent of an entity is required to be in the same state, Corporation Service Company receives Albany New York Process Service at its Albany County address. 

Credit Suisse Energy LLC is located in New York, NY, United States, and is part of the Electric Power Generation, Transmission, and Distribution Industry. On October 31st, 2008, the Department of Energy received an application from Credit Suisse Energy LLC for authority to transmit electric energy from the United States to Mexico as a power marketer. Credit Suisse Energy LLC itself does not own any electric transmission facilities nor does it hold a franchised service area. The electric energy which Credit Suisse Energy LLC was to export to Mexico would be surplus energy purchased from electric utilities, Federal power marketing agencies, and other entities within the United States.

CREDIT SUISSE CASH RESERVE FUND, INC.

Credit Suisse Cash Reserve Fund, Inc is a Foreign Business Corporation according to Albany New York Process Service, with the entity falling under Maryland jurisdiction. The corporation was incorporated on 11th  March 1985 and subsists as one of the premier subsidiaries of the Credit Suisse Group. Credit Suisse Cash Reserve Fund, Inc. was registered and incorporated in New York, with its registered agent for Albany County New York Process Service as The Corporation rather than Corporation Service Company like other Credit Suisse subsidiaries.  Albany County New York Process Service   is also provided upon the Chief Executive Officer or any higher officer who is authorized to accept service of process

CREDIT SUISSE EMERGING MARKETS FUND, INC  

Credit Suisse Emerging Markets Fund, Inc. is a Foreign Business Corporation according to Albany County New York Process Service, although it comes under Maryland jurisdiction. The entity was incorporated on 22nd  February 1994.  Credit Suisse Emerging Markets Fund, Inc, INC  retains its own registered agent for Albany New York Process Service not similar to other Credit Suisse group entities. As such,  Credit Suisse Emerging Markets Fund, Inc directs its documents for Albany County New York Process Service to Credit Suisse Asset Management LLC. However, Credit Suisse Emerging Markets Fund, Inc registered agent retains an address for the Albany County New York Process Service in the state of incorporation, with the Albany County New York process service also being available to be served upon major authority figures of the business entity itself as viable forms of Albany County New York Process Service. 

On December 16th, 2009, the US Department of Justice announced that it had reached an agreement with Credit Suisse regarding allegations that the bank assisted residents of the International Emergency Economic Powers Act sanctioned countries in violating both the Act and New York law between 1995 and 2006. Credit Suisse agreed to forfeit over five hundred million as part of the settlement.

Credit Suisse agreed on 5 July 2018 to pay a fifty million dollar fine to the US Department of Justice and thirty million dollars to settle US Securities and Exchange Commission allegations (SEC). According to the SEC’s investigation, the banking firm solicited banking and investment business in the Asia-Pacific area by recruiting and promoting over one hundred Chinese officials and associated individuals in violation of the Foreign Corrupt Practices Act.

For more information on serving legal papers, contact Undisputed Legal our Albany County New YorkProcess Service department at (800) 774-6922. Representatives are available Monday-Friday 8 am – 8 pm EST.  If you found this article helpful, please consider donating.  Thank you for following our blog, A space dedicated to bringing you news on breaking legal developments, interesting articles for law professionals, and educational material for all. We hope that you enjoy your time on our blog and revisit us!  We also invite you to check out our Frequently Asked Questions About Process Servers.

Sources

1. The move to retail banking started in the 1900s when the middle class rose and UBS and Julius Bär, other Swiss banks, competed with BSI.

2. First Boston was almost pushed out of business due to a bad loan in the 1980s, but in 1988, Credit Suisse acquired enough shares to put them in control of the company.

3. Qatar Investment Authority, Harris Associates, Dodge & Cox, Norway’s central bank, and the Olayan Group (all US-based funds) have majority stakes in Credit Suisse.

4. The bank was involved in a series of international investigations for tax evasion and paid penalties totaling USD 2.6 billion in fines during the years between 2008 and 2012.   

5. “Risk Management & Sustainability.” Credit Suisse, www.credit-suisse.com/about-us/en/our-company/corporate-responsibility/banking/risk-management-sustainability.html. 

6. WELLS FARGO DELAWARE TRUST COMPANY, N.A.

919 N MARKET ST 1600

WILMINGTON County: New Castle

DE Postal Code: 19801 

7. CORPORATION SERVICE COMPANY

251 LITTLE FALLS DRIVE

WILMINGTON County: New Castle

DE Postal Code: 19808

302-636-5401

8. CORPORATION SERVICE COMPANY

251 LITTLE FALLS DRIVE

WILMINGTON County: New Castle

DE Postal Code: 19808

302-636-5401

9. This official is generally the Secretary of State, and many jurisdictions refer to the Certificate of Existence as a Certificate of Good Standing

10. New York Department of State, Division of Corporations, One Commerce Plaza, 99 Washington Avenue, Albany, NY 12231.

11. C/O CREDIT SUISSE ASSET MANAGEMENT LLC

Address: ELEVEN MADISON AVE, NEW YORK, NY, United States, 10010

12. MICHAEL KENNEALLY

Address: C/O CREDIT SUISSE ASSET MGMT I, 466 LEXINGTON AVE 15TH FL, NEW YORK, NY, United States, 10017 – 3147

13. FIRST BOSTON INCOME FUND

Address: INC., JAY T. ROELOF, TOWER 49,12 E. 49TH ST, NEW YORK, NY, 10017

14. C/O CORPORATION SERVICE COMPANY

Address:80 STATE STREET, ALBANY, NY, United States, 12207

15. ‘CSE proposes to export electric energy to Mexico and to arrange for the delivery of those exports over the international transmission facilities presently owned by AEP Texas Central, El Paso Electric Company, Central Power & Light Company, San Diego Gas & Electric Company, Sharyland Utilities, and Comision Federal de Electricidad, the national electric utility of Mexico.’

16. THE CORPORATION

Address: MICHAEL KENNEALLY, 466 LEXINGTON AVE, NEW YORK, NY, United States, 10017 – 3147

17. JOHN POPP

Address: ELEVEN MADISON AVE, NEW YORK, NY, United States, 10010

18. C/O CREDIT SUISSE ASSET MANAGEMENT LLC

Address:466 LEXINGTON AVENUE, NEW YORK, NY, United States, 10017 – 3147

Chief Executive Officer’s

19. STEVE PLUMP

Address:466 LEXINGTON AVENUE, NEW YORK, NY, United States, 10017 – 3147

Principal Executive Office or Owner Name and Address

HOW TO SERVE LEGAL PAPERS ON FREDDIE MAC

Freddie Mac

Undisputed Legal | Virginia Process Service

Freddie Mac is based in Tysons Corner, Virginia, and is a government-sponsored enterprise that is owned by the United States government.  Freddie Mac is the name given to the Federal Home Loan Mortgage Corporation when was established in 1970 under the Emergency Home Finance Act to expand the secondary mortgage market and reduce interest rate risk for banks.

In 1989, Freddie Mac was reorganized and turned into a shareholder-owned company as part of the Financial Institutions Reform, Recovery, and Enforcement Act.

BACKGROUND

Freddie Mac’s charter is quite similar to Fannie Mae’s in that it expands the secondary market for mortgages and MBSs by buying loans made by banks, savings and loans, and other lending institutions. But unlike Fannie Mae, which buys mortgages from major retail and commercial banks, Freddie Mac buys its loans from smaller banks, such as thrift banks, that focus on providing banking services to communities.

In 1970, the FHLMC was established to develop a larger secondary mortgage market in the US. Freddie Mac acquires mortgages from the secondary market, pools them, and sells the mortgages as mortgage-backed securities on the open market via Fannie Mae. Having a secondary mortgage market may help with lending and the availability of funds for both mortgage lending and house buying needs. The business ‘Freddie Mac’ has a brand name that was developed to be recognizable by potential clients.

Fannie Mae and Freddie Mac were placed under the control of the Federal Housing Finance Agency (FHFA) after its regulator, James B. Lockhart III, announced his conservatorship in September 2008.

IMPORTANCE OF FREDDIE MAC

Since the US Department of the Treasury has begun an investment of up to a hundred billion dollars billion in Freddie Mac preferred stock at a rate of ten percent a year, a significant portion of the US Treasury Department’s portfolio consists of the Freddie Mac preferred stock.  Shares of Freddie Mac fell from about USD 1 to USD 0.50 in September 2008, and they were delisted in June 2010 when the Federal Housing Finance Agency ordered the stock exchanges to remove them.  Treasury debt was expected to rise in 2008, thus bond yields climbed.  Freddie Mac saw its profits return with the housing market and economy rebounding.

HISTORY OF FREDDIE MAC

The Federal National Mortgage Association (Fannie Mae) was the primary organization that purchased mortgages from banks, which stimulated the lending industry and allowed the US government to back the value of loans with its implicit support. Fannie Mae was separated into a privately-owned and publicly-funded company in 1968. Fannie Mae was a private corporation and retained its charter to purchase mortgages from banks and savings and loans. 

However, this meant that Fannie Mae no longer had a dedicated insurance policy, so its support of mortgages was solely based on the financial security of the banks and savings and loans rather than government guarantees. The company in question, known as the Government National Mortgage Association (Ginnie Mae), gave assurances to those who had mortgages, issued on behalf of federal workers or veterans, who wanted to use them as collateral (the mortgages themselves were also guaranteed by other government organizations).

Since there was now a new private company, Freddie Mac, in place to compete with Fannie Mae, Congress needed to pass the Emergency Home Finance Act of 1970 to put Freddie Mac in place as a private business to expand the quality of mortgage financing available. Their respective charters were the same: to increase the secondary mortgage market by purchasing residential mortgages from banks and savings and loan organizations. When Freddie Mac was established, it was under the jurisdiction of the Federal Home Loan Bank Board and the Federal Home Loan Bank System, and it was privately held.

Fannie Mae and Freddie Mac’s regulation was updated in 1989 when the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (often known as FIRREA) was passed. It completely disconnected Freddie Mac from the Federal Home Loan Bank System. The Federal Home Loan Bank Board (FHLBB) was then completely disbanded and has been replaced by many other organizations. The dissolution of the Federal Home Loan Bank Board meant that now, a new independent body named the Federal Housing Finance Board (FHFB) would be established to supervise the twelve Federal Home Loan Banks (also called district banks).

ISSUES THAT FREDDIE MAC HAS FACED

The US Department of Housing and Urban Development (HUD) alerted Freddie Mac in 2004 that it was not doing enough to compete, claiming the firm was late to respond to changing markets and was stuck with a ‘historical lack of diversity in its credit rating assessment. This was especially relevant insofar as Fannie  Mae and  Freddie  Mac are publicly held financial institutions that were created by  Acts of  Congress to fulfill a  public mission. The entities were specifically created to see that the secondary mortgage market was given an additional boost of liquidity and stability in order to ensure that low-and-moderate income households and neighborhoods had more access to mortgage credit.  Their federal charters provide important competitive advantages that,  taken together,  long implied  U.S.  taxpayer support of their financial obligations.  

The U.S. federal government placed Freddie Mac under conservatorship on September 7th, 2000.

HOW DOES FREDDIE MAC EARN ITS PROFITS 

Freddie Mac earns the majority of its profits from fees on mortgage-backed securities, or MBS, where fees are paid by loan borrowers. Freddie Mac investors are offering to take on the credit risk, allowing Freddie Mac to retain the credit enhancement charge. So Freddie Mac’s guarantee ensures that the borrower’s principal and interest will be repaid, regardless of whether or not the borrower repays the loan. This MBS has been very popular among investors due to Freddie Mac’s financial guarantee and may be sold in the TBA market since it is an Agency MBS.

Government-Sponsored Enterprises are permitted to purchase only conforming loans, thereby putting a lid on demand for non-conforming loans in the secondary market. Non-conforming loans are more difficult to sell since fewer buyers compete for them, which is because a poor match between supply and demand causes a bigger fee for the customer. FHFA is currently in charge of yearly adjustments to conforming loan limits, which respond to the October to October shift in the national average house price. 

MAJOR DRAWBACKS OF FREDDIE MAC

Freddie Mac has released a statement assuring that any securities the organization issues will not be guaranteed by the US government, and are not debts or liabilities of the US government or any agency or instrumentality of the US government. The Federal Home Loan Mortgage Corporation (FHLMC) and FHLMC securities are neither supported nor covered by the US government. No government guarantees repayments on FHLMC instruments. It is clearly spelled out in the laws governing GSEs, which are published in their securities, and in GSE communications released to the public.

At this point, it should be known that the influence of the federal government is not directly on the FHLMC, wherein the corporation itself receives little immediate aid. Most of the assistance it receives is through government subsidies. 

HOW FREDDIE MAC HAD TO BE REBORN FROM THE MORTGAGE CRISIS OF 2008

Mortgage originators that distributed more and more of their loans via private-label MBS were no longer under the watchful eye of the GSEs since they were removed from the GSEs’ supervision. Mortgage originators gained influence, while the GSEs lost it, thanks to rivalry between the GSEs and private securitizers over mortgage loans. A precipitous drop in underwriting standards resulted, which led to the financial catastrophe.

Since there was little risk, securitizers were more likely to securitize riskier loans. Private securitizers did not, and they may only keep a little slice of risk. A re-financing boom, led by very low-interest rates, resulted in exceptional financial institution profits from 2001 to 2003. Financial institutions attempted to retain their high profits levels in response to rising interest rates by making their mortgages riskier and shifting towards private label MBS distribution. 

The degree of profit is directly correlated with the amount of business done. Consequently, in order to boost profit, the bank expanded its borrower pool, including people with worse credit ratings and new product offerings the GSEs would not (originally) securitize. Thus, the change in mortgages from conventional fixed-rate mortgages to atypical adjustable-rate mortgages, accompanied by a worsening in underwriting standards, corresponds with the departure from GSE securitization and the ascent of private-label securities. 

Since the expansion of private-label securities pushed the GSEs to reduce their underwriting requirements, upsetting their private owners, the GSEs tried to increase their market share again. Shareholder pressure prompted the GSEs to compete with private-label securities for market share, and they did so by loosening underwriting requirements to ensure they wouldn’t lose their guarantee business. Nevertheless, while the government-run FHA/Ginnie Mae has maintained its criteria and therefore lost market share,

Many of these house foreclosures were triggered by low interest-rate loans taken out by borrowers with bad credit who saw an opportunity in low mortgage rates, only to find themselves unable to afford their payments later. As house values dropped, the significant increase in foreclosures, already high inventory, and more stringent lending practices reduced borrower access to mortgages. 

Due to the decline in house values, the GSEs have started experiencing increasing losses, since the bulk of mortgages in the US are backed by them. ‘Fannie Mae and Freddie Mac play a vital role in the US home financing system,’ the government told the market in July 2008, trying to calm their concerns. The Treasury Department and the Federal Reserve acted to help give the companies confidence, such as the Treasury’s removal of the ban on their purchasing the GSEs’ stock, which gave the two companies access to Federal Reserve low-interest loans and allowed the Federal Reserve to loan funds to the GSEs. Even though a lot of work was done, by August 2008, Fannie Mae and Freddie Mac’s shares had both fallen more than 90 percent in one year.

THE CONSERVATORSHIP OF FREDDIE MAC

James B. Lockhart III, director of the Federal Housing Finance Agency (FHFA), said on September 7, 2008, that he was placing Fannie Mae and Freddie Mac under the control of the FHFA because of his concerns about their finances. FHFA has publicly declared that the Fannie Mae liquidation is not in the works. 

The federal government will put the companies under conservatorship, remove the current CEO and board, elect a new board, and issue new shares to the federal government. Shareholders prior to the conservatorship will see a substantial reduction in their holdings due to the fact that they will want to protect the values of both corporate debt and mortgage-backed securities.

The United States Treasury has the ability to invest in Fannie Mae and Freddie Mac by taking on more debt only up to the amount that the federal government may lawfully take on. To account for the Treasury needing the ability to sustain the federal home lending banks, the overall national debt limit was raised to ten trillion dollars after July 30th, 2008, legislation that provided more regulatory power over Fannie Mae and Freddie Mac.

The US government seized ownership of Fannie Mae and Freddie Mac on September 7th, 2008. It was decided to fire Fannie Mae’s and Freddie Mac’s CEOs, Daniel Mudd and Richard Syron. Former Vice Chairmen of Merrill Lynch, Herbert M. Allison, and US Bancorp, David M. Moffett, respectively, have assumed control of Fannie Mae and Freddie Mac.

SUPPLEMENTARY LEGISLATION

The Budget and Accounting Transparency Act was presented to the United States House of Representatives on May 8TH, 2013 by Representative Scott Garrett. Fannie Mae and Freddie Mac, two government credit programs, may benefit from the legislation.  The law forces the federal budget to account for government direct loans and loan guarantees using methods from the Financial Accounting Standards Board.

Changes to the law would imply that Fannie Mae and Freddie Mac’s debt would count as part of the national debt rather than be evaluated separately and that their debt would be included in the budget.  The federal budget would just handle these programs differently, without altering the programs themselves. This legislation aims to make more accurate the accounting of several programs in the government budget.

HOW TO SERVE LEGAL PROCESS ON FREDDIE MAC

Freddie Mac comes under Virginia Process Service guidelines and is specifically classified under the SIC Code 6111 for Federal And Federally Sponsored Credit Agencies. SIC Code 6111 – Federal and Federally-Sponsored Credit Agencies is a final level code of the ‘Finance, Insurance, Real Estate Division. 

Fannie Mae retains its business address for accepting Virginia Process Service. Its Primary address falls in Mclean, Virginia, with its mailing address corresponding with the same to ensure Virginia Process Service. The entity also has a phone number in order to ensure Virginia Process Service is done easier.  

For more information on serving legal papers, contact Undisputed Legal our Virginia Process Service department at (800) 774-6922. Representatives are available Monday-Friday 8 am – 8 pm EST.  If you found this article helpful, please consider donating.  Thank you for following our blog, A space dedicated to bringing you news on breaking legal developments, interesting articles for law professionals, and educational material for all. We hope that you enjoy your time on our blog and revisit us!  We also invite you to check out our Frequently Asked Questions About Process Servers.

Sources

1. Seidman, Harold. ‘Government-Sponsored Enterprise in the United States.’ The New Political Economy: The Public Use of the Private Sector, 1975, pp. 83–108., doi:10.1007/978-1-349-02042-3_4. 

2. Freddie Mac is the 41st-largest company in the United States in terms of annual revenue, with assets under management of $2.063 trillion.

3. Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) Pub.L. 101–73 103 Stat. 183

4. ‘Get Started Here:’ Conservatorship | Federal Housing Finance Agency, www.fhfa.gov/Conservatorship. 

5.  One of the most extensive government interventions in private financial markets in decades 

Moody’s gave Freddie Mac’s preferred stock an investment-grade credit rating of A1 until August 22, 2008, when Warren Buffett said publicly that both Freddie Mac and Fannie Mae had tried to attract him and others. Moody’s changed the rating on that day to Baa3, the lowest investment-grade rating. Freddie’s senior debt credit rating remains Aaa/AAA from each of the major rating agencies: Moody’s, S&P, and Fitch.  

6. Gertler, Mark, and Simon Gilchrist. ‘What Happened: Financial Factors in the Great Recession.’ JSTOR, 1 July 2018, www.jstor.org/stable/10.2307/26473063?refreqid=search-gateway. 

7. The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA Pub.L. 101–73 103 Stat. 183 is a United States federal law enacted in the wake of the savings and loan crisis of the 1980s.

It established the Resolution Trust Corporation to close hundreds of insolvent thrifts and provided funds to pay out insurance to their depositors. It transferred thrift regulatory authority from the Federal Home Loan Bank Board to the Office of Thrift Supervision.

8. The board, which consisted of 18 members, was established and given HUD supervision (HUD)

9. ‘Credit Ratings.’ Freddie Mac, www.freddiemac.com/investors/credit-ratings.html. 

10. ‘Treasury to Rescue Fannie and Freddie.’ The Washington Post, WP Company, 7 Sept. 2008, www.washingtonpost.com/wp-dyn/content/article/2008/09/06/AR2008090602540.html. 

11. U.S. House of Representatives, Committee on Oversight and Government Reform. 2009. ‘The Role of Government Affordable Housing Policy in Creating the Global Financial Crisis of 2008.’ Press release. Washington, DC: U.S. House of Representatives, Committee on Oversight and Government Reform.

12. A mortgage becomes a jumbo loan when it is over the maximum allowable limit. The maximum permissible loan value in high-cost states like Alaska, Hawaii, Guam, and the US Virgin Islands (the territories) is increased by as much as 50 percent; in the case of properties with two to four units, a similar higher maximum is provided. To deal with the current crisis in housing, alterations to these restrictions were put in place.

13. There is a widespread belief that FHLMC securities are backed by some sort of implied federal guarantee and a majority of investors believe that the government would prevent a disastrous default. Vernon L. Smith, 2002 Nobel Laureate in economics, has called FHLMC and FNMA ‘implicitly taxpayer-backed agencies. The Economist has referred to ‘the implicit government guarantee of FHLMC and FNMA.

The then director of the Congressional Budget Office, Dan L. Crippen, testified before Congress in 2001, that the ‘debt and mortgage-backed securities of GSEs are more valuable to investors than similar private securities because of the perception of a government guarantee’

14. The Congressional Budget Office writes, ‘There have been no federal appropriations for cash payments or guarantee subsidies. But in the place of federal funds, the government provides considerable unpriced benefits to the enterprises. Government-sponsored enterprises are costly to the government and taxpayers

15. Budget and Accounting Transparency Act of 2014 (H.R. 1872; 113th Congress)

16. The Standard Industrial Classification is a system for classifying industries by a four-digit code. Established in the United States in 1937, it is used by government agencies to classify industry areas.

17. MIDTOWN CENTER
1100 15TH ST, NW

WASHINGTON DC 20005

18. 8200 JONES BRANCH DR

MCLEAN

VA

22102

HOW TO SERVE LEGAL PAPERS ON GINNIE MAE

Ginnie Mae

Undisputed Legal | District of Columbia Process Service

The US Government National Mortgage Association (GNMA), is a government-owned corporation of the US Department of Housing and Urban Development (HUD). It strives to reduce interest rates for loans on their homes, including new construction and rehabilitation of existing housing stock. The entity also ensures that such loans are backed up by mortgage guarantees. The organization was established in 1968 and is so named for its goal. It secures timely repayment of MBS for investors, even if borrowers fail on the mortgages, so that houses may be foreclosed upon.

The Federal Housing Authority, Department of Veterans Affairs, Department of Housing and Urban Development’s Office of Public and Indian Housing, Department of Agriculture’s Rural Development, and other government organizations provide loans that are eligible for Ginnie Mae’s guarantee. Ginnie Mae, unlike Freddie Mac and Fannie Mae, is not a provider of home mortgages. The agency’s mortgage-backed securities rest on the credit risk of the agency itself and various other ensuring government entities.

HISTORY OF GINNIE MAE

Ginnie Mae (Government National Mortgage Association) is a government corporation with a few similarities to Fannie Mae (Federal National Mortgage Association) and Freddie Mac (Federal Home Loan Mortgage Corporation.) The major difference between these entities is that Ginnie Mae is wholly owned by the government whereas Fannie Mae and Freddie Mac are private companies with government charters. As a government corporation, Ginnie Mae and its programs are governed by a set of regulations published in the Code of Federal Regulations at Title 24, Part 300-400 Although some contend that Fannie Mae and Freddie Mac securities have benefited from the U.S. government’s guarantee (considering that the government had to rescue them from insolvency and place them under government conservatorship in September 2008), today, Ginnie Mae securities are the only mortgage-backed securities backed by the ‘full faith and credit guarantee of the U.S. Federal Government.

The origin of Ginnie Mae can be traced back to the Great Depression. With the effects of the Great Depression wrecking lives in every corner of the United States, the United States Congress took action in 1934 to tackle the issue by enacting the National Housing Act of 1934, which created the Federal Housing Administration (FHA). To help fund new home construction and development, the FHA’s goal was to provide insurance to private lenders in order to reduce their fear of losses because of mortgage default. A nationwide mortgage organization was thus created to purchase and sell FHA-insured mortgages, and FHA was charged with chartering and supervising the entity. Fannie Mae was established in 1938 to assist mortgage lenders to have better access to funding for mortgages.

Over the years, the Act’s requirements have morphed. The modern mortgage financing system only came about as a result of the 1968 decision to further expand the capital base accessible for mortgages. Notably, this meant Congress okaying a split of Fannie Mae in 1968 as part of the Housing and Urban Development Act. The split rendered a clear difference between Fannie Mae and Ginnie Mae, wherein the former was originally strictly limited to purchasing Federal Housing Administration and Veterans Administration mortgages while Ginnie Mae was originally only supposed to provide insurance for bonds issued by FHA and VA mortgages in special affordable housing programs.

HOW DOES GINNIE MAE WORK

Ginnie Mae assures institutional investors of the timely payment of principal and interest on mortgage-backed securities. These securities, which serve as collateral for loans on Wall Street, may be found on every stock exchange. Since Ginnie Mae provides guarantees for these mortgage-backed securities, they are much more attractive to investors. This attractiveness also stems from investors being able to trade these instruments in the to-be-announced market because of Ginnie Mae’s backing. These mortgage-backed securities are known as ‘pass-through‘ certificates because they pass the principal and interest of the underlying loans to investors; this is done via mortgage-backed securities instruments issued by Ginnie Mae. 

The Ginnie Mae guarantees securities backed by single-family and multifamily loans insured by the government, assures clients that its collateral comes from a variety of federal agencies, including the Federal Housing Administration (FHA), Department of Veterans Affairs (VA), Department of Housing and Urban Development’s Office of Public and Indian Housing (HUD), Department of Agriculture’s Rural Development (RUS), and the Department of Agriculture’s Housing and Credit Guarantee Agency (HCGA).  Ginnie Mae introduced a new pool type, called the RG pool, to securitize the Re-performing Loans impacted by Pandemic in APM 20-07.

UNDERSTANDING GINNIE MAE AGAINST PRIVATELY OWNED ENTITIES

Ginnie Mae simply plays the role of a service provider and is a broker that only services mortgages, not create or buy any. It has no involvement in the issuance, distribution, or purchase of securities. Ginnie Mae takes a conservative approach to risk by not using derivatives to hedge and avoiding long-term debt or associated securities obligations. Rather than allow Ginnie Mae-approved private lending institutions to issue mortgage-backed securities, which are then owned by Ginnie Mae, it is the private lending institutions that issue the mortgage-backed securities that are owned by Ginnie Mae and originated by the private lending institutions. State housing financing agencies are among the organizations with geographically varied mortgage firms, commercial banks, and thrifts of various sizes.

Ginnie Mae stands clear in its defined role as a federal government corporation that guarantees payment of principal and interest on time for mortgage-backed securities that stem from approved lenders. It merely provides mortgage lenders a better price option in capital markets. Approved private lenders originate eligible loans, pool them into securities, and issue mortgage-backed securities guaranteed by Ginnie Mae.

THE EVOLUTION OF GINNIE MAE

The United States Department of Housing and Urban Development (HUD) created the United States Government National Mortgage Association (GNMA) in 1968 to encourage affordable homeownership.  Ginnie Mae’s primary function is to guarantee loans and does not extend or provide mortgages in the market. Rather, the entity reduces interest rates on these government-backed loans to help homeowners lower their borrowing expenses.

In 1970, it created and guaranteed mortgage-backed securities and has kept this backing up since. In 1983, the Luxembourg Stock Exchange was the first foreign exchange to sell securities.   In contrast to the rest of the mortgage market, Ginnie Mae is at the rear, not issuing and selling pass-through mortgage-backed securities nor mortgage loans. Instead, authorized private lenders are permitted to issue mortgages on their own, pool the mortgages into securities, and issue Ginnie Mae-backed securities. Ginnie Mae’s MBS portfolio balance, which is noted on the association’s website, is said to be worth around two trillion dollars. Ginnie Mae has guaranteed mortgage-backed securities since 1970 to help open the home mortgage market to first-time homemakers, low-income borrowers, and other underserved groups.

This is done to ensure that mortgage bankers, savings and loans, and commercial banks (among others) are making timely payments of principal and interest on their qualified loans. Someone who invests in Ginnie Mae-backed securities has no idea who issued the mortgages that are behind it but know they can be assured by Ginnie Mae. Just like U.S. Treasury securities, the instruments are backed by the full confidence and credit of the U.S. government. The Ginnie Mae guarantee assures investors that late payments or mortgage defaults would not affect their investment. Ginnie Mae comes in to fulfill missed payments when mortgage debtors are unable to pay.

The expanded mortgage market is helping to support lending to those who are historically underrepresented by Ginnie Mae. Many mortgages, often backed by the Federal Housing Administration (FHA), which guarantees mortgages to first-time home purchasers and low-income borrowers, are put into a government program known as Ginnie Mae, which is not always available to the majority of U.S. borrowers.

CAVEATS FOR GINNIE MAE

As a government organization, Ginnie Mae does not accomplish all its promises. It is worth noting that the organization does not launch any mortgages and does not back any issuers. Additionally, the GNMA does not protect lenders against credit risks that come from their borrowers. Also, Ginnie Mae notably does not establish criteria, such as underwriting or credit requirements, for lending institutions.

Ginnie Mae has comparable counterparts like Freddie Mac, Fannie Mae, and Sallie Mae. The services offered by Freddie Mac, Fannie Mae, and Sallie Mae all focus on certain markets: Fannie Mae works with housing, Freddie Mac is focused on mortgage and house loans, and Sallie Mae deals mainly with student loans. The primary contrast is that Ginnie Mae is owned by the federal government. Shareholders in private companies are also in charge of the government-chartered GSEs.

While Ginnie Mae only offers guarantees on securities backed by the federal agencies FHA and VA mortgages, this nevertheless allows its siblings to issue securities using mortgages from other agencies that are not guaranteed by the federal government. Fannie Mae’s retained portfolio also invests in mortgages owned by both Fannie Mae and other financial institutions.

THE INTRICACIES OF  GINNIE MAE SECURITIES

The government’s backing of credit agencies is seen in Ginnie Mae, Fannie Mae, and Freddie Mac, all of which function inside the U.S. credit market. Both Fannie Mae and Freddie Mac are government-sponsored entities, while Ginnie Mae is part of the federal government. Together, these three players have a significant share of the mortgage lending industry in the United States.

Ginnie Mae, Fannie Mae, and Freddie Mac, the U.S. government-sponsored enterprises, do not originate loans. Via their participation in the mortgage credit market through issuing and financing mortgage-backed securities, they are also not limited to only mortgages. They may ensure that the loans they get are good for them by coming up with criteria for and interests in their securities’ securitized loans.

Each mortgage loan from a bank or other financial institution sold to Ginnie Mae and other government agencies is pooled with others, and then investors may buy an investment that represents these loans altogether. The acquisition of mortgage loans that are bundled up into various securitized products is funded by Ginnie Mae money, which acts as a vital source of cash for the banks, enabling them to finance additional new loans. Lenders have the freedom to invest the money Ginnie Mae lends them in new mortgages..1

TYPES OF SECURITIES OFFERED BY GINNIE MAE

 The open market invests in securities issued by Ginnie Mae, Fannie Mae, and Freddie Mac via the use of techniques and methods tailored specifically to each of them. Pass-through assets with their scheduled principal and interest payments are one option, while collateralized mortgage obligations are another one in the context of being a highly structured product with clearly distinguished tranches that define payments and maturities.

The loans that each agency is interested in buying from the banks are based on individual lending criteria. Banks will sell loans to Ginnie Mae directly because the banks usually create pools of loans from their balance sheet for Ginnie Mae to buy. Ginnie Mae may include loans from many institutions into its offering. Ginnie Mae issues the pooled security when they securitize a loan using a collective vehicle. It also ensures investors will be paid both the interest and principal on their loans.

ABOUT THE GINNIE MAE BONDS

The primary difference between purchasing Ginnie Mae bonds and normal stock investment is complexity. Many big institutions are purchasing high denomination Ginnie Mae securities. While reduced liquidity may be a problem, they are more difficult to find in general.

The minimum investment is often ten thousand dollars, although certain government-backed mortgage securities are more accessible to small investors. These securities provide monthly payments which may fluctuate. The monthly payments of the underlying loans are the principle and interest found in the security.

The aforementioned assets have such a large minimum investment that alternatives have seen an increase in popularity. Many smaller investors choose to put their money into Ginnie Mae assets via mutual funds or real estate investment trusts. REITs, or real estate investment trusts, are companies that own or finance income-producing real estate across a range of property sectors.

Because they are supported by the U.S. government, Ginnie Maes is one of the most popular mortgage-backed securities. The government will step in to prevent Ginnie Mae and its securities from failing, but this won’t guarantee their safety.

HOW TO SERVE LEGAL PAPERS ON GINNIE MAE.

Ginnie Mae sees its headquarters in Washington DC and comes under the ambit of District of Columbia Process Service. It must be known that the entity essentially is a wholly-owned government corporation within the Department of Housing and Development and as such must have District of Columbia Process Service levied upon it appropriately. 

The government corporation model has been utilized by the federal government extensively, with the spectrum ranging from established megaliths like the U.S. Postal Service and the Federal Deposit Insurance Corporation to small, low-visibility corporate bodies, such as the Federal Financing Bank in the Department of the Treasury and Federal Prison Industries in the Department of Justice. Ginnie Mae’s statutory origins lend its basis for the District of Columbia Process Service as a government corporation. This statute grants Ginnie Mae the authority to guarantee securities and exempts Ginnie Mae securities from Securities and Exchange Commission registration requirements.

It must be known that if an employee of Ginnie Mae or the entity itself issued, District of Columbia Process Service may be achieved by serving the entity and then sending a copy of the summons and of the complaint by registered or certified mail to the officer, agency, or corporation to comply with District of Columbia Process Service. 

For more information on serving legal papers, contact Undisputed Legal our District of Columbia Process Service department at (800) 774-6922. Representatives are available Monday-Friday 8 am – 8 pm EST.  If you found this article helpful, please consider donating.  Thank you for following our blog, A space dedicated to bringing you news on breaking legal developments, interesting articles for law professionals, and educational material for all. We hope that you enjoy your time on our blog and revisit us!  We also invite you to check out our Frequently Asked Questions About Process Servers.

Sources

1. Ginnie Mae’s statutory authority is derived from Title III of the National Housing Act, 12 U.S.C. 1716 et seq.

2. Bloomberg.com, Bloomberg, www.bloomberg.com/politics?pid=newsarchive&sid=ayy9zizvS2bY. 

3.  National Housing Act of 1934, H.R. 9620, Pub.L. 73–479, 48 Stat. 1246,

4. Fannie Mae was then permitted to deal in conventional mortgages in 1970

5. MBS are bonds secured by real estate loans such as home mortgage loans or other residential property loans. A mortgage lender can create MBS by using a pool of loans, usually with similar characteristics, as collateral for an MBS. This means that the MBS that is created from these loans will provide payments to an investor that are derived from the payments made by borrowers of the underlying mortgages (MBS collateral). 

6. ‘Ginnie Mae I Mortgage-Backed SECURITIES: HUD.gov / U.S. Department of Housing and Urban Development (HUD).’ Ginnie Mae, I Mortgage-Backed Securities | HUD.gov / U.S. Department of Housing and Urban Development (HUD), www.hud.gov/hudprograms/Ginnie_Mae_I. 

7. ‘What We Do // .’ Programs & Products, www.ginniemae.gov/about_us/what_we_do/Pages/programs_products.aspx. 

8. ‘This pool type was first announced by Ginnie Mae in December 2020 and consisted entirely of loans that were bought out of pools and cured with partial claims. These are eligible for securitization after 6 months without a missed payment. A previous announcement was made by Ginnie Mae last June that prohibited loans in forbearance from being bought out of pools and securitized into any existing pool type

9. APMs (All Participant Memoranda) are issued by IPM generally to announce policy and MBS Guide changes accessed by Issuers, Document Custodians, and other participants in Ginnie Mae programs

10.Other well-known issuers of Ginnie Mae guarantees include securities that consist of mortgages underwritten by the VA and RHS, respectively.)

11. Charles Schwab, Vanguard, and Fidelity all offer Ginnie Maes via their regular brokerages.

12. ‘REIT Industry Timeline.’ REIT Industry Timeline | Nareit, www.reit.com/investing/reit-basics/reit-industry-timeline#0. 

13. REITs own many types of commercial real estate, ranging from office and apartment buildings to warehouses, hospitals, shopping centers, hotels, and commercial forests. Some REITs engage in financing real estate.

14. 451 7th St., SW

Room B-133

Washington, DC 20410

15.  Natural Resources Defense Council, Inc. v. Tennessee Val. Authority, 459 F.2d 255 (2d Cir. 1972);

16. Fed. R. Civ. P. 4(i)(2); 28 U.S.C. § 1391(e)(3). In addition, 28 U.S.C. § 1391(e)(3) permits the service of an officer or agency by certified mail beyond the territorial limits of the jurisdiction in which the action is brought, notwithstanding Fed. R. Civ. P. 4(k), if the official issuable in the District of Columbia

HOW TO SERVE LEGAL PAPERS ON MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC.

Undisputed Legal | New York City Process Service

Mortgage Electronic Registration System is a privately owned company based in the United States. MERS is a separate and distinct corporation that acts as a nominee on mortgages after the turn of the century.  The entity is controlled by holding company MERSCORP Holdings, Inc., which currently owns the MERS system.

The MERS System exists as an automated registration system that is used to monitor and control servicing rights and ownership of mortgages in the United States. According to the Treasury Department, the Federal Reserve Board of Governors, the Federal Deposit Insurance Corporation, and the Federal Housing Finance Agency, MERS serves as an agent for lenders without making any reference to MERS as a principal.

HOW DOES MORTGAGE ELECTRONIC REGISTRATION SYSTEM  WORK

Mortgage Electronic Registration System essentially functions as a repository developed by the mortgage banking sector. It subsists in the capacity of a secure computerized register for mortgages issued in the United States that monitors transfers and changes to servicing rights and loan ownership. The real estate finance sector uses it to register and trade residential and commercial mortgage loans.

MERS– which is also the name of the privately held company that manages the database– has been approved by government-sponsored enterprises such as the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac), and the Government National Mortgage Association (Ginnie Mae), as well as government agencies such as the Federal Housing Administration (FHA) and the Federal Reserve. Additionally, it is used by the California and Utah Housing Finance Agencies, as well as all major Wall Street credit rating agencies.

Every occasion wherein a bank sells a mortgage to another, an assignment—a document indicating the transference of the mortgage—is ideally produced and registered in the county property records. The assignment transfers to the banking institution all of the previous lender’s interest in the mortgage. By electronically monitoring loan transfers, MERS removes the lender’s long-standing need to register an assignment with the county recorder each time the loan is transferred from one bank to another.

Mortgage originators, servicers, warehouse lenders, wholesale lenders, and retail lenders, as well as document custodians, settlement agents, title firms, insurers, investors, and county recorders, all utilize the MERS system. County and regulatory authorities, as well as homeowners, have unfettered access to MERS. Homeowners may access data according to the individual mortgages that have been recognized by the platform.

HOW TO USE ELECTRONIC TRACING WITH MERS

When using the feature of electronic tracing, the mortgage servicer must first assign the loan a mortgage identification number (MIN) and afterward enroll this with the MERS database. Occasionally, MERS is identified as the mortgagee; the term used in the mortgage papers to refer to the original lender. This kind of loan is referred to as an original mortgagee loan. Following thereon, the seller may initiate the mortgage involving MERS as the lender’s nominee (the beneficiary), and afterward allocate or register the loan to MERS in the county land records. As a result, MERS would become the mortgagee of record.

It should be known that MERS in its capacity as a mortgagee of record has come under major legal scrutiny. The Nevada United States District Court in Mortgage Electronic Registration Systems, Inc. v. Lisa Marie Chong, et al.  mentioned in its 2009 caselaw that ‘MERS provided no evidence that it was the agent or nominee for the current owner of the beneficial interest in the note, it has failed to meet its burden of establishing that it is a real party in interest with standing.’ 

HISTORY OF MORTGAGE ELECTRONIC REGISTRATION SYSTEM

Mortgage Electronic Registration Systems, Inc. is the third iteration of a legacy of businesses formed with the same name on the 1st of January, 1999. In 1995, the abbreviation ‘MERS’ stood for Mortgage Electronic Registration Systems, Inc. Mortgage Electronic Registration Systems, Inc. registered the term ‘MERS’ as a service mark with the United States Patent and Trademark Office (USPTO) in 1997 for use in connection with their mortgage loan registry system. The original company was subsequently amalgamated with additional companies established by its management and board of directors.

Even though the 1995 Mortgage Electronic Registration Systems, Inc. (the first version) developed the MERS service mark and system, it disintegrated after being renamed MERSCORP, Inc. on 1st January 1999 and then went on to MERSCORP Holdings, Inc. on 27th February 2012, where it is the owner and manager of the registry but is not divulged in mortgages.

In the United States of America, real estate law and transactions are regulated by state statutes and county-level recording laws. In the early 1980s, this made it very difficult for financial firms to establish a market based on mortgages that operated smoothly. This is because whenever a financial instrument containing mortgages is sold, various state laws may require that the sale of each such mortgage (or deed of trust) be recorded in the county courts in order to preserve certain rights, triggering an obligation to pay corresponding recording fees.

As a result, the banking sector, eager to trade mortgage-backed securities, sought to find a way around these recordation regulations, which is how the MERS system was created to substitute public recordation with private recordation.  Nonetheless, MERS portrays its operations as supplementing existing public land-registration systems. 

Mortgage Electronic Registration Systems, Inc. is the record owner (or the record owner’s nominee) of the security interest created by mortgages issued by lenders, investors, and loan servicers and registered in county property records. By utilizing MERS, lenders, and investors who are the true parties in interest avoid the need to file assignments in county land records, thereby lowering costs for lenders and, they claim, consumers by reducing county recording fee expenses associated with real estate transfers. MERS also serves as a central repository of information and tracking for mortgage loans.  

MERSCORP Holdings, Inc.’s position in enabling mortgage trading was largely uncontroversial in its early years, but the ongoing repercussions from the subprime mortgage crisis have placed the business at the heart of numerous court challenges contesting the corporation’s authority to start foreclosures. If these challenges are successful, the US banking sector may find itself in need of more capital.

A QUESTION OF WHERE THE MERS SYSTEM FALLS

The ownership of the MERS system is muddled amongst the organizations to the extent that courts often mistake the registry system with the nominee due to their shared usage of the term ‘MERS.’

 The MERS system is alleged to have complied with the ‘Safe Harbor’ provisions of the state-led Uniform Electronic Transactions Act (UETA) and E-SIGN (Electronic Signatures in Global and National Commerce Act of 2000) as reflected in documents filed with the United States Trademark and Patent Office by MERSCORP, Inc. However, how the MERS system gets the papers from Mortgage Electronic Registration Systems, Inc. (the third iteration of the 1999 version) remains unknown.

MERSCORP HOLDINGS, INC.

MERSCORP Holdings, Inc. is typified as a foreign business corporation from Delaware with the initial Department of State filing as done in New York being on 14th October 1997, rendering it Delaware jurisdiction. MERSCORP Holdings originally was formed on 16th October 1996. The entity retains its address New York City Process Service via its registered agent for accepting New York Process Service. In this case, the responsibility for New York Process Service would fall to CT Corporation System. CT Corporation System functions as the registered agent for New York Process Service. A Statement of Information is due every year beginning five months before and through the end of October.

If New York City Process Service is not levied upon the registered agent, it may also be provided to the officer in charge. This would be the Chief Executive Officer or some other individual with similar designated authority. MERSCORP Holdings, Inc. is a privately held corporation that owns and manages the MERS System and all other MERS products. It is a member-based organization made up of more than five thousand lenders, servicers, sub-servicers, investors, and government institutions.  MERS, MERSCORP Holdings, or the MERS System are not document custodians and do not hold promissory notes or mortgage documents on behalf of lenders, servicers, or investors. The entity is not responsible for keeping mortgage records—the servicer maintains the loan files and must be considered in issues of New York Process Service.

MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC.

Mortgage Electronic Registration Systems, Inc..is typified as a foreign business corporation from Delaware with the initial Department of State filing as done in New York being on 4th May 1999, rendering it Delaware jurisdiction. The initial date of foreign formation has been recorded on 1st January 1999 for the entity. The entity retains its address for New York City Process Service via its registered agent for accepting New York Process Service, CT Corporation System. CT Corporation System functions as the registered agent for New York Process Service. MERS is a nominee for the lender and subsequent buyers (‘beneficial owners’) of a mortgage loan and serves as a common agent for the mortgage industry.

As the mortgagee of record, MERS receives New York Process Service, legal notices, and other mail regarding the mortgaged properties. MERSCORP Holdings, Inc., on behalf of MERS, sorts, scans, and transmits documents electronically to the appropriate MERS System Member. Because MERS is a common agent for its members, recording an assignment of the mortgage is eliminated when ownership of the promissory note or servicing rights transfer between members. This reduces work and cost. The MERS System also provides information on undisclosed liens, which reduces fraud.

If New York City Process Service is not levied upon the registered agent, it may also be provided to the officer in charge. This would be the Chief Executive Officer or some other individual with similar designated authority to accept New York Process Service. Mortgage Electronic Registration Systems, Inc. (MERS) is a wholly-owned subsidiary of MERSCORP Holdings, and its sole purpose is to serve as mortgagee in the land records for loans registered on the MERS System. 

MERS TECHNOLOGIES CORPORATION

MERS Technologies Corporation is an entity of the Mortgage Electronic Registration Systems more recently incorporated under New York’s Department of State. MERS Technologies Corporation was established with the Department of State of New York subsequent to the acquisition, having its initial filing completed on September 22nd, 2010. The entity is entirely New York-based, filing for incorporation in New York County for the purposes of New York City Process Service.

A MERS Technologies Corporation is wholly subject to the regulations of New York City Process Service, is a domestic business entity for legal purposes. The steps required to incorporate a company are outlined in the section of the Business Corporation Law pertaining to incorporating business corporations. Additionally, the organization retains a registered agent for New York City Process Service which is different from most other MERS entities, which is The Corporation.  However, when the Secretary of State is served, New York City Process Service is frequently considered to be completed. The Department of State will then ship a copy of the New York Process Service to the company with a certified mail with the specified address to MERS Technologies Corporation, made available while giving the Certificate of Incorporation, which is on file with the other MERS Technologies Corporation in the Department of State.

MERS USA, INC.

MERS USA, Inc. came into being as a subsidiary of MERS corporation. After the company settled into its property in New York, it had to form an entity with the state and file an initial filing for New York Process Service, which occurred on 31st January 2007. For New York Process Service purposes in New York, the company was formed in New York County and is under New York City jurisdiction.

MERS USA, Inc .is a New York City Process Service domestic business corporation that is regulated by New York City Process Service and is thus entirely subject to the laws of the state. As described in the law on creating business companies,  Business Corporation Law, there are the stages that must be completed to incorporate a business. Additionally, as a result, when New York City Process Service completes the process required for adequate service with the Secretary of State, the Secretary is deemed to have received notice. After sending the relevant firm details to MERS USA, INC via certified mail, the Department of State will send the whole New York Process Service to MERS USA, INC. This is made available while giving the Certificate of Incorporation, which is on file with the other MERS USA Inc documents in the Department of State as per the stipulations of New York Process Service.

MERS may also be served via their registered agent or an official who is vested with the appropriate authority to receive New York City Process Service.

As an electronic mortgage repository, MERS drastically streamlines the mortgage process. MERS saves money because of the mortgagee service, which reduces the costs of documenting the transfer of a mortgage. The benefit of having the loan recorded in MERS’ name is that when the loan changes ownership, recording expenses and time are saved by not having to record a new assignment every time.

Critics claim that the database has problems. A quagmire arose in the 2008 housing crisis because of complications related to differentiating who had mortgages. Homeowners in foreclosure or wishing to get debt relief were faced with an additional hurdle, as they were required to identify who owned their mortgages in order to begin solving the problem.

For more information on serving legal papers, contact Undisputed Legal our New York City Process Service department at (800) 774-6922. Representatives are available Monday-Friday 8 am – 8 pm EST.  If you found this article helpful, please consider donating.  Thank you for following our blog, A space dedicated to bringing you news on breaking legal developments, interesting articles for law professionals, and educational material for all. We hope that you enjoy your time on our blog and revisit us!  We also invite you to check out our Frequently Asked Questions About Process Servers.

Sources

1. MERS and Intercontinental Exchange announced the acquisition of MERS by ICE on October 5, 2018.  

2. Kate Pickert Monday, Jul. 14. ‘A Brief History of Fannie Mae and Freddie Mac.’ A Brief History of Fannie Mae and Freddie Mac – TIME, 14 July 2008, web.archive.org/web/20081006011833/www.time.com/time/business/article/0,8599,1822766,00.html. 

3. ‘MERS.’ MERS INC, www.mersinc.org/join-mers-docman/1502-jltebadi3uth/file. 

4. MERS® SERVICERID, www.mers-service rid.org/sis/common/search;MERSSESSIONID=824C1A92DF8A51E1453812F606826CBB?searchType=&min=&fn=&ln=&cn=&num=&street=&unit=&city=&state=&zip=&exp=&cert=. 

5. Countrywide Home Loans, Inc., 656 F.3d 1034

6. ‘MORTGAGE ELECTRONIC REGISTRATION Systems, INC. V Lisa MARIE Chong, Lenard E Schwartzer, Bankruptcy TRUSTEE, Et Al.’ Livinglies’s Weblog, 14 Dec. 2009, living lies.me/2009/12/13/mortgage-electronic-registration-systems-Inc-v-Lisa-Marie-Chong-Lenard-e-Schwartzer-bankruptcy-trustee-et-al/. 

7. He issued his decision in 5 of the 18 cases (In re Chong, In re Pilatich, In re Cortes, In re Medina and In re O’Dell) on appeal but declined to hold that ‘MERS would not be able to establish itself as a real party in interest had it identified the holder of the note or provided sufficient evidence of the source of its authority

8. Premo, Grant A. ‘Fifth Circuit Court of Appeals Upholds Mers’ Authority to Assign Mortgages.’ Financial Services Perspectives, 22 Oct. 2015, www.financialservicesperspectives.com/2015/10/fifth-circuit-court-of-appeals-upholds-mers-authority-to-assign-mortgages/. 

9. ‘Faqs: Eclosings & Emortgages.’ FAQs: EClosings & EMortgages | Fannie Mae, singlefamily.fanniemae.com/learning-center/delivering/faqs-eclosings-emortgages. 

10. See, the right to foreclose non-judicially [‘5.12.4 Judicial/Non-Judicial Foreclosures: Internal Revenue Service.’ 5.12.4 Judicial/Non-Judicial Foreclosures | Internal Revenue Service, www.irs.gov/irm/part5/irm_05-012-004. ]

11. ‘The MERS® System is the only nationwide database that offers open public access to servicer information for registered house mortgages, complementing centuries-old public land recordation systems.’  By 2007, MERSCORP Holdings, Inc. had accounted for about two-thirds of all home loans in the United States.

12. The Uniform Electronic Transactions Act (UETA) is one of the several United States Uniform Acts proposed by the National Conference of Commissioners on Uniform State Laws (NCCUSLnIts purpose is to harmonize state laws concerning the retention of paper records (especially checks) and the validity of electronic signatures.

13. The Electronic Signatures in Global and National Commerce Act (E-Sign Act), 1 signed into law on June 30, 2000, provides a general rule of validity for electronic records and signatures for transactions in or affecting interstate or foreign commerce.

14. C T CORPORATION SYSTEM

Address:28 LIBERTY ST., NEW YORK, NY, United States, 10005

15. CHRIS McEntee

Address:5660 NEW NORTHSIDE DR, 3RD FLOOR, ATLANTA, GA, United States, 30328

16. C T CORPORATION SYSTEM

Address:28 LIBERTY ST., NEW YORK, NY, United States, 10005

17. THE CORPORATION

Address:244 E 60TH ST. #4A, NEW YORK, NY, United States, 10022

18. SOLOMON A TORRES

Address:622 WEST 168TH STREET, PH 14-105, NEW YORK, NY, 10032 – 3784

19. SYBRAND ROELLE

Address:102 PHILLIPS AVENUE, ROCKPORT, MA, United States, 01966

 

HOW TO SERVE LEGAL PAPERS ON TESLA MOTORS

Tesla Motors

Undisputed Legal | California Process Service

Tesla Inc. (TSLA) mainly develops and produces completely electric high-performance cars. The electric car manufacturer also offers energy production and storage technologies and services for its products. Tesla was established in 2003. The objective was to create automobiles that would be less dependent on fossil fuels yet as fast and enjoyable to drive as gasoline-fuelled vehicles. The firm debuted its Roadster in 2008 and Model S, Model X, and Model 3 were followed. Tesla has extended its electric vehicle range over the past few years to include the Model Y SUV and two distinct kinds of trucks – the Tesla Semi and the Cyber car. 

Tesla is a very young business, but its fast development into the most valuable carmaker was backed by a number of significant acquisitions in recent years, in particular. The main purpose of these purchases was to increase production capacity, improve operating speed and efficiency and reduce costs. The corporation does not show how much profit or revenue each purchase generates now. 

BACKGROUND

Tesla, Inc. is a California-based electric car and renewable energy business headquartered in Palo Alto. Tesla develops and produces electric vehicles, household and grid-scale battery energy storage, solar panels, and solar roof tiles, as well as associated goods and services. Tesla sold the most battery-electric and plug-in electric cars in 2020. The business designs and installs solar systems in the United States via its subsidiary Tesla Energy. Tesla Energy is also a leading worldwide provider of battery energy storage systems, with plans to deploy 3 gigawatt-hours (GWh) by 2020.

Tesla Motors was founded in July 2003 by Martin Eberhard and Marc Tarpenning as a homage to inventor and electrical engineer Nikola Tesla. Elon Musk, the co-founder of X.com, became the company’s biggest shareholder and chairman in February 2004 with a USD 6.5 million investment. Since 2008, Musk has served as CEO. According to Musk, Tesla’s mission is to accelerate the transition to sustainable transportation and energy through electric cars and solar energy. Tesla started manufacturing the Roadster, the company’s first automobile, in 2009. Tesla Model S sedan was introduced in 2012, Tesla Model X SUV in 2015, Tesla Model 3 sedan in 2017, and Tesla Model Y crossover in 2020. 

Tesla has been involved in a number of lawsuits and disputes stemming from CEO Elon Musk’s comments and actions, as well as accusations of creative accounting, whistleblower retaliation, labor rights abuses, and unsolved and hazardous technical issues with their vehicles.

HOW DOES TESLA’S MODEL WORK

When Tesla was founded in 2003, electric cars were prohibitively costly.  Elon Musk said in 2006 that Tesla’s approach will be, to begin with high-priced, low-volume vehicles, such as sports cars, for which consumers are less price sensitive. This would enable them to gradually reduce the cost of batteries, allowing them to provide more affordable and high-volume vehicles.  Tesla’s first car, the Roadster, was manufactured in small quantities (fewer than 2,500 units) and was priced at more than USD 100,000. The Model S and Model X follow as more economical but still luxurious cars. The most current versions, the Model 3 and Model Y, are even more affordable and targeted at a larger market.  Each quarter, the company sells over 100,000 cars. In contrast to almost every other automaker, Tesla upgrades the hardware of its vehicles on a continual basis rather than waiting for a new model year.

Unlike other manufacturers, Tesla does not sell its cars via franchised dealerships. Rather than that, the business sells cars directly via its website and a network of company-owned locations. Certain countries, most notably the United States, ban automobile manufacturers from selling directly to customers. Tesla operates facilities dubbed galleries in these regions that, according to the firm, ‘teach and enlighten consumers about our products, but such venues do not engage in the selling of cars.’   Rather than being situated near other car dealerships, these sites are usually in retail shopping areas or inside shopping malls. Tesla does not promote directly.  The business informs clients via its showrooms located in malls and other high-traffic areas and sells its cars directly to consumers rather than through a traditional dealer network. The business is the country’s first to sell automobiles directly to customers.

Tesla has a high degree of vertical integration, having reached an all-time high of 80% in 2016.

The business manufactures car components and also develops unique charging stations for clients’ automobiles. Vertical integration is uncommon in the automobile industry, as firms generally outsource about 80% of component production to suppliers and concentrate on engine manufacturing and final assembly.

Tesla usually licenses its technology to rivals, saying that it wants to assist competitors in accelerating the world’s adoption of sustainable energy. Licensing agreements include clauses requiring the receiver to promise not to sue Tesla for patent infringement or to directly duplicate its designs. Tesla maintains ownership of its other intellectual property, including trademarks and trade secrets, in order to protect its technology from direct imitation.

SUBSIDIARIES OF TESLA INC

TESLA, INC. WHICH WILL DO BUSINESS IN CALIFORNIA AS TESLA MOTORS, INC.

Tesla has officially changed its name to Tesla, Inc. from its prior official Tesla Motors, Inc. corporate name. The change of name probably reflects the expansion of its business as SolarCity owns, and develops battery packages for both residential and commercial applications, elements of the firm which Tesla’s CEO, Elon Musk, has stated, would become more important in its total operation.

In late 2016, Tesla, Inc. acquired SolarCity, a solar power business established by Musk’s cousins, where he was also the board chairman. Tesla also launched last year its Powerwall second-generation residential energy battery storage technology as well as its commercial solar power storage solution Powerpack 2.0. The firm has also disclosed plans to develop solar roof panels which appear as regular roof tiles and started delivering to consumers shortly thereafter.

Tesla Inc. is typified as a foreign stock corporation in California with the initial Department of State filing as done in Delaware being on 2nd September 2003, rendering it Delaware jurisdiction. The entity retains its address for California Process Service in Palo Alto, California.  California Process Service may be levied on a registered agent for accepting California Process Service, in this case, Corporation Trust Company functions as the registered agent for California Process Service. A Statement of Information is due every year beginning five months before and through the end of September.

A business entity can be formed in California by filing the applicable document or form (as described below) with the Secretary of State. 

TESLA ELECTRIC INC

Tesla Electric Inc. is a Californian domestic stock business company with the first filing on 8th January 2021 and does come under the jurisdiction of California. The entity retains an address in Glendale, California, and has retained Tadeh Alexander as a registered agent. 

A business entity can be formed in California by filing the applicable document or form (as described below) with the Secretary of State. It is thus necessary to file Articles of Incorporation and the forms must have been drafted to meet the minimum statutory and California Process Service requirements.

The company has to first qualify or register with the California Secretary of State prior to conducting intrastate business in California. California Corporations Code defines intrastate transactions as recurring and consecutive transactions of its activities in that state other than international or foreign trade.  It should be noted that a foreign corporation shall not be considered to be transacting intrastate business merely because its subsidiary transacts intrastate business. Once the business entity is formed or registered with the California Secretary of State it must obtain the necessary licenses and permits according to California Process Service requisites. However, the Secretary of State does not issue licenses or permits for business entities.

A Statement of Information is due every year beginning five months before and through the end of January. The Office of the Secretary of State cannot advise the entity whether the company has to qualify or register in California to do business.

TESLA ENERGY OPERATIONS, INC.

Tesla Energy Operations Inc. is typified as a foreign stock corporation in California with the initial Department of State filing done in Delaware. The entity was registered on 7th September 2006. Tesla Energy Operations Inc does not come under California jurisdiction, with the incorporation in Delaware specifying a General Domestic Corporation. However, the entity retains CT Corporation as their agent for California Process Service as well as retains their principal office in Palo Alto, California. California levies two taxes on companies that do business in the state or earn revenue there: [A.] the franchise tax and [B.] the income tax.

Additionally, a foreign company (a corporation, organization, or other legal body not organized in California) doing intrastate commerce in California must acquire a Certificate of Qualification to do business in California. Any company, regardless of where it is incorporated, that ‘carries on business in California’ or ‘derives revenue from sources inside California’ is usually liable to California’s tax rules.

Thus, foreign corporations that are either [A.] ’doing business in California or [B.] generate revenue from California sources are liable to California taxation. Additionally, if a foreign company earns revenue both inside and outside of California (for example, California, Texas, and Mexico), an income allocation between the states is required to determine the precise amount of the California tax.

TESLA INSURANCE SERVICES, INC.

Based in Palo Alto, California Tesla already sells car insurance in California and is in the process of obtaining approval from state authorities to do so in Illinois, Texas, and Washington. Musk said on Tesla’s October earnings call that insurance might eventually account for 30% to 40% of Tesla’s car revenue. He claims that Tesla is constructing ‘a major insurance company.’ Tesla’s chief finance officer, Zachary Kirkhorn, has said that the firm would ultimately provide countrywide car insurance.

Musk and Kirkhorn stated during last year’s earnings calls that Tesla’s car insurance would be directly linked to a Tesla vehicle, allowing the business to evaluate a motorist’s risk based on their driving history and then set monthly rates appropriately. This kind of insurance is referred to as pay-as-you-drive or usage-based insurance. Tesla, on the other hand, claims it presently sets tariffs using anonymized, aggregated data from its cars, not data based on an individual’s behavior. Tesla presently provides car insurance to purchasers of its vehicles exclusively in California. Tesla Model S, Model X, Model 3, Model Y, and Roadster owners are covered. Tesla began offering insurance in California in 2019. Tesla’s California insurance is underwritten by State National Insurance Co.

Tesla Insurance Services Inc is a domestic stock entity that is registered for California Process Service within the state of California. The entity is currently active in Fremont, California, and has registered for the same on 22nd June 2017, retaining the CT Corporation system as their registered agent for California Process Service. A Statement of Information is due every year beginning five months before and through the end of June.

DEEP SCALE

DeepScale, Inc. is an American technology company headquartered in Mountain View, California, that develops perceptual system technologies for automated vehicles. On October 1, 2019, the company was purchased by Tesla. Forrest Iandola and Kurt Keutzer co-founded DeepScale in September 2015. DeepScale received USD 15 million in Series A financing in 2018. In 2018, the company established key collaborations with Visteon and Hella Aglaia Mobile Vision GmbH, among others. On October 1, 2019, Tesla acquired the company, which specializes in driverless car technology.

MAXWELL TECHNOLOGIES INC.

Maxwell Laboratories Inc. was established in 1965. In 1983, it became public, and in 1996, the company changed its name to Maxwell Technologies Inc. The entity is a foreign stock company in California, coming under Delaware jurisdiction since its incorporation on 26th December 1986. However, the entity retains its principal office in Palo Alto, California with Corporation Trust Company as its registered agent for California Process Service.  The energy storage and power delivery solutions company specializes in ultracapacitors, which are devices that can store several times the energy of ordinary capacitors. Its products are utilized in a variety of industries, including transportation, manufacturing, and grid energy storage.

Tesla bought Maxwell in May 2019. Musk previously said that ultracapacitors will be a game-changer in terms of electric car manufacturing. He was particularly enthusiastic about Maxwell’s efficient method for manufacturing electric battery components, which may significantly decrease Tesla’s manufacturing costs.

As of December 2020, Tesla and Musk were named in over 1,000 lawsuits. Several of Tesla’s significant legal issues stem from Musk’s August 7, 2018 tweet, ‘I’m considering taking Tesla private at $420. Funding secured ‘, as the tweet first boosted the stock but then fell when it was proven to be fake. Musk resolved fraud charges with the United States Securities and Exchange Commission (SEC) in September 2018 for his misleading claims. Musk agreed to have his tweets examined by Tesla’s in-house counsel, was temporarily removed from his chairman position at Tesla, and two new independent members were added to the company’s board of directors. Tesla and Musk also paid USD20 million in civil fines. A civil class-action shareholder complaint was also filed against Musk and the members of Tesla’s board of directors as they were then constituted in connection with comments made and acts taken in connection with a possible going-private transaction.

Numerous questions have been raised regarding Tesla’s financial reporting. Bloomberg News questioned Tesla’s financial reporting in 2013 for allegedly violating generally accepted accounting principles (‘GAAP’) rules. Tesla was accused by Fortune magazine in 2016 of using clever accounting to demonstrate positive cash flow and quarterly profits. Analysts raised worry over Tesla’s accounts receivables level in 2018. Tesla CFO Zach Kirkhorn was questioned by the SEC in September 2019 regarding Tesla’s warranty reserves and lease accounting. David Einhorn, a hedge fund manager, accused Elon Musk of ‘serious fraud’ in November 2019 and publicly questioned Tesla’s accounting procedures, telling Musk he was ‘starting to doubt if your accounts receivable exist.’

For more information on serving legal papers, contact Undisputed Legal our California Process Service department at (800) 774-6922. Representatives are available Monday-Friday 8 am – 8 pm EST.  If you found this article helpful, please consider donating.  Thank you for following our blog, A space dedicated to bringing you news on breaking legal developments, interesting articles for law professionals, and educational material for all. We hope that you enjoy your time on our blog and revisit us!  We also invite you to check out our Frequently Asked Questions About Process Servers.

Sources

1. Accounting for 16% of the plug-in market (which includes plug-in hybrids) and 23% of the battery-electric (pure electric) market

2. Last year the Firm updated its internet URL from Teslamotors.com to Tesla.com and defines itself on its formal ‘About’ page as ‘Not just a car manufacturer, but also a technology and design company focused on innovation in energy.’

3. Entity Mailing Address:

3500 DEER CREEK ROAD
PALO ALTO CA 94304

Entity Address:

3500 DEER CREEK ROAD
PALO ALTO CA 94304

4. THE CORPORATION TRUST COMPANY

CORPORATION TRUST CENTER 1209 ORANGE ST

WILMINGTON County: New Castle

DE Postal Code: 19801

302-658-7581

5. TADEH ALEXANDI
1164 ALLEN AVE APT 6
GLENDALE CA 91201

6. Required Articles of Incorporation:

    • Articles of Incorporation of a General Stock Corporation (Form ARTS–GS)
    • Articles of Incorporation of a Close Corporation (Form ARTS–CL)
    • Articles of Incorporation of a Professional Corporation (Form ARTS–PC)
    • Articles of Incorporation of a Nonprofit Mutual Benefit Corporation (Form ARTS–MU)
    • Articles of Incorporation of a Nonprofit Public Benefit Corporation (Form ARTS–PB–501(c)(3))
    • Articles of Incorporation of a Nonprofit Religious Corporation (Form ARTS–RE)
    • Articles of Incorporation of a Common Interest Development Association (Form ARTS–CID)

7. Entity Address:

1164 ALLEN AVE APT 6
GLENDALE CA 91201

Entity Mailing Address:

1164 ALLEN AVE APT 6
GLENDALE CA 91201

8. Entity Address:

3500 DEER CREEK ROAD
PALO ALTO CA 94304

Entity Mailing Address:

3500 DEER CREEK ROAD
PALO ALTO CA 94304

9. Egan, John. ‘Tesla Insurance Plans Surge into Three New States.’ Forbes, Forbes Magazine, 22 June 2021, www.forbes.com/advisor/car-insurance/tesla-insurance/. 

Tesla intends to ‘use the technology in vehicles to lower costs and improve the customer experience through automated underwriting, rating, and claims, including direct data, feeds with customer permission, that eliminate frictional costs and inefficiencies inherent in traditional insurance processes,’ according to a regulatory filing in Texas. ‘The digital approach to purchasing insurance by the consumer will streamline and enhance the user experience throughout the policy lifecycle; beginning with the quote through online bind, renewal, and in the event of a claim.’

10. Entity Address:

45500 FREMONT BLVD
FREMONT CA 94538

Entity Mailing Address:

45500 FREMONT BLVD
FREMONT CA 94538

11. 970 TERRA BELLA AVE #9
MOUNTAIN VIEW CA 94043

Entity Address:

970 TERRA BELLA AVE #9
MOUNTAIN VIEW CA 94043

Entity Mailing Address:

970 TERRA BELLA AVE #9
MOUNTAIN VIEW CA 9404

 
12. Entity Address:

3500 DEER CREEK ROAD
PALO ALTO CA 94304

Entity Mailing Address:

3500 DEER CREEK ROAD
PALO ALTO CA 94304

13. Osborne, Charlie. ‘The $40 million tweet: Elon Musk settles with SEC, Tesla bears the brunt. ZDNet.

14. Eidelson, Josh (September 27, 2019). ‘Tesla Labor Practices and Musk Tweet Broke the Law, Judge Rules. Bloomberg News.

15. Tully, Shawn. ‘Why Tesla’s Cash CRUNCH May Be Worse than You Think.’ Fortune, Fortune, 25 Apr. 2021, fortune.com/2016/09/02/elon-musk-tesla-cash-crunch-worse-than-you-think/.