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Business & Company Information: Sources & Strategies

Research RefresherLaura M. ScottMarch 27, 2009

Goals for today

Cover the basics of company research in law practice

Strategies and favorite sources

P id l f il bl li Provide examples of available online tools and their featuresDiscuss the kinds of information you can (and can’t) expect to find

Why research companies?

Marketing and business developmentConflicts checkingLitigationDue diligenceCompetitive intelligence: research other law firms

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Scope of factual research

Depends on:reason for the researchtime constraintsfi i l t i tfinancial constraints

Internet research tools

Free & fee-based toolsSome free tools require registrationSome free partial accessLots of fee-based (per search & Lots of fee based (per search & subscription) sources

Don’t forget outside resourcese.g., Local public and university business libraries, government libraries, private subscription libraries

Researching Companies

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Scenario

You’re preparing to visit a potential corporate client. What do you want to know?

Info about the people you’re meeting p p y gwithInfo about the company’s businessAny recent legal issues they’ve hadTheir competitorsTrends in their industry

General tips for company research

Know whether the company is public or private.Kinds & sources of info may differ

Public - SEC filingsPrivate - D&B, other private company reports, Secretary of State’s office

What if you don’t know?Try Hoover’s

Good example of a combination pfree and fee-based source.

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General tips, cont.

Start with the company website…Especially the “About us,” “Investor relations,” and “Company history” sectionssections...but do your own research, too.

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Earnings conference call

News of potential legal interest

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General tips, cont.

Consider whether a fee-based source would add value to your research.

Save timeSave timeThe only source?Nicely formatted outputSupportBetter search and navigation functionality

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Specific kinds of company information

General backgroundCompany info, general industry info and competitorsWhy?

Marketing & good client service – important to understand client’s business.

Sources (examples): SEC filings and annual reports to shareholdersSEC filings and annual reports to shareholdersIndustry-specific journalsCompany reports

Hoover’sBusiness Source Complete (Datamonitor company reports; industry journals; market reports)Mergent OnlineBloomberg, Lexis, and WestlawYahoo! Finance

Finding Business Source Complete & Mergent

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Includes many scholarly business journals and useful profiles and reports

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Report is based mostly on SEC filings, butprovides a quick executive summary.

Another useful fee-based sourcefor company info. (Find it the sameway you’d find Business Source Complete.)

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Good for a quick overviewAnother cool feature: Variety of output options -simple “tear sheet” to complex customized reports.

Different amounts of info, depending on your subscription

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Lots of search options

“Westlaw Business,” an example ofa fee-based source for securities filings

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Business & Legal News

News about the company, including management changes, legal issues, trends affecting its industryWhy? – Understand the client’s business and industry and potential legal needsSources

LexisNexis (or Westlaw)BloombergBusiness journals (e.g., WSJ.com,)Local/regional business newspapers

e.g., Bizjournals.com

Industry-specific trade journalsTry Business Source Complete or Dialog

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Great for local/regionalbusiness news.

Lots of cities/regions

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Corporate structureFamily trees/subsidiariesWhy?

Conflicts checkingMarketingDue diligence

Tools:Tools:SEC Form 10-K, Ex. 21Directory of Corporate Affiliations (Lexis)Dun & Bradstreet Family Tree FinderMergent OnlineIndustry-specific sources

e.g., Best’s Company Reports (insurance/reinsurance)

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Public company, simple research task:use free SEC filings

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List of exhibits to 10-K

List of subsidiaries is always in the same exhibit

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Private company: May have touse a fee-based source

Corporate family tree,useful formatting.

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Bonus: Nice privatecompany report

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Not much financial data

Important people

Identification and biographical information about officers, directors, insiders, general counselWhy?

Marketing – do we know someone at this Marketing do we know someone at this company?

Tools:Company website (“About us”)SEC filings (public) – 10-K, among othersPrivate company reports

e.g., Dun & BradstreetSecretary of State (sometimes)

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Dun & Bradstreet

Too small for private company reports on Lexis or Business Source Complete

Range of reports $ $$$$$Range of reports $-$$$$$

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State of Incorporation

Not always the same as corporate HQ locationWhy do you need to know?

Often stated in complaintsOften stated in complaintsDiversity jurisdiction

Tools:Public companies: Cover sheet of SEC filingsPrivate companies: Secretary of State

FreeFee-based source: (CTAdvantage.com)

Again, free is fine for this task…

…and fine here, too.

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Registered agent

a.k.a. “agent for service of process”Why?

Serve papers

Tools:Secretary of StateCT Corp. (CTAdvantage.com)

Corporate documents

Company by-laws, articles of incorp.Why?

Amendment of by-laws, etc.Due diligence

Tools:Public companies:

SEC filings - 10-K Ex. 3Old filings - commercial SEC sources

Private companies: Secretary of State

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Financial data

Why?Due diligenceIs this party judgment-proof?

Tools:Tools:Public companies: SEC filings (10-K audited, 10-Q unaudited)Private companies: Dun & Bradstreet Business Information Reports

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Legal agreements

Why?Due diligence – Existing contracts might affect your deal.Forms for other dealsForms for other deals

Tools:Exhibits to 10-Ks and 10-Qs

Use a fee-based service

Recent or ongoing legal activity

Litigation, labor disputes, recent deals, environmental issues, real estate transactions, permitting issuesWhy?

Due diligenceMarketing

Tools:SEC Filings - 10-Q or 10-K “Legal proceedings” section (“material” litigation only); recent 8-Ks News searchesCase and docket searches

Other law firms representing them

Why?MarketingCompetitive intelligence

Tools:Tools:SEC Filings – ‘33 Act “S” forms, sometimes 8-KsCourtlink Strategic ProfilesCase & docket searchesSurveys (ALM & local legal press)

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Courtlink Strategic Profiles

Federal courts andsome state courts

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AIG’s outside counsel infederal civil cases for1st Q 2009

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Formatting options

American Lawyer Media

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Must subscribe for fullreport and data

Similar kind of survey at thelocal/regional level

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Historical stock prices

Why?Litigation

ToolsFree sources

WSJ/Big ChartsWSJ/Big ChartsYahoo! FinanceGoogle Finance

Fee-based sourcesLexis, Westlaw, some fee-based SEC databasesUse for: additional data, older prices, delisted companies

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Questions?