Corporations Code section 3503

Any officers, directors, employees, or agents of a social purpose corporation who do any of the following shall be liable jointly and severally for all the damages resulting therefrom to the social purpose corporation or any person injured by those actions who relied on those actions or to both:

(a)

Make, issue, deliver, or publish any prospectus, report, including the reports required pursuant to Section 3500 and 3501, circular, certificate, financial statement, balance sheet, public notice, or document respecting the social purpose corporation or its shares, assets, liabilities, capital, dividends, business, earnings, or accounts which is false in any material respect, knowing it to be false, or participate in the making, issuance, delivery, or publication thereof with knowledge that the same is false in a material respect.

(b)

Make or cause to be made in the books, minutes, records, or accounts of a social purpose corporation any entry that is false in any material particular knowing it to be false.

(c)

Remove, erase, alter, or cancel any entry in any books or records of the social purpose corporation, with intent to deceive.

(d)

With respect to the reports required pursuant to subdivision (b) of Section 3500 and Section 3501, omit to state any material fact necessary in order to make the statements contained therein, in light of the circumstances under which those statements were made, not misleading in a material respect, knowing the omission to be misleading.

Source: Section 3503, https://leginfo.­legislature.­ca.­gov/faces/codes_displaySection.­xhtml?lawCode=CORP§ionNum=3503.­ (accessed May 13, 2025).

Last Updated

May 12, 2025

§ 3503’s source at ca​.gov