In Plain Sight: Corporations and Public Records
Clients are often surprised to learn how much corporate information is on the public record. Of course, public companies are forced to disclose a lot more data than private ones, but it's still possible to learn about private companies using smart and thorough public records searches.
And there’s more to learn than just what assets a company holds. For example, determining what the organizational chart is at a corporation, including who reported to whom and on what projects they collaborated may help an attorney trying to create a witness list for a case. A law firm doing due diligence for an acquisition may want to know if a company has been sued, and by whom. They will also want to hear what current and former company insiders have to say about the company’s ins and outs. A non-profit interested in naming a corporate executive to its board of directors may want to make sure that the company the executive works at doesn’t have any skeletons in its closet in the form of embarrassing litigation, financial irregularities or regulatory failures.
So what can a client expect from a public records search for a corporation? Below is a list of just some of the available information:
- Secretary of State corporation records: Corporate record filings from individual Secretary of State offices will sometimes include information on where the company was originally registered, the names and addresses affiliated with the company, including any parent company or any other companies doing business under different names (knows as “DBAs” for “Doing Business As”). These records will indicate if the company is still in good standing in the state, having paid all the necessary fees and provided updated copies of appropriate paperwork, perhaps including any important changes in leadership. Public records of the state where a company is doing business will help identify where it was originally registered. Incorporation records are often publically available for a small fee and detail the company’s original structure and its key players.
- Real property records: A search of property records (usually at the county level) using the corporation’s official name, or, if relevant, any of its DBAs, may help determine the corporation’s real property. In addition, property records usually detail mortgages and whether there are any liens pending.
- Personal property rolls: Some state and local governments tax businesses on their personal property, requiring corporations to declare their assets to determine how much they owe. In some cases, these financial records are publically available.
- UCCs: Companies file Uniform Commercial Code (UCC) records when they enter into a secured borrowing transaction with another company or an individual. The records detail the transaction, including what the borrower declared as collateral. This information may help determine what assets a company holds. UCCs are filed at the state and local levels.
- Intellectual property: The U.S. Trademark and Patent Office databases detail any trademarks and patents a company has filed with the federal government. In addition, company copyrights can be searched via the U.S. Copyright Office databases.
- Securities and Exchange Commission filings: If the company is a public company, SEC filings will provide information on the company’s financials, as well as any accounting issues or regulatory concerns that have to be addressed or explained. Also, records may list current or former employees, executives or board members worth interviewing.
- Litigation: There should be a criminal and civil litigation search on the federal level, as well as any state where the company does business. Such searches may be time consuming if the company has various locations, but it is worth being thorough. Litigation searches will also help expose if there are any judgments against the company, and trial records may help uncover individuals at odds with the company who may be willing to shed light on any potentially damaging company information. They could be former employees or simply adversaries whose litigation uncovered important company information. In many cases, we also find it helpful to search lower courts as well at the county or city levels.
- Former employees: Former employees of a corporation are often worth interviewing. Some databases provide names of all employees their records indicate are somehow affiliated with a particular company. The results may require some culling, but better too much than too little.
- Media searches: Learning what sort of press coverage a company has received is invaluable. Any press coverage that ranks the corporation in relation to its competitors may prove helpful in anticipating problems or concerns. Pay close attention to how the company’s financial standing is represented in the press—whether these analyses are correct or not, public perception of a company is valuable information. Similarly, it is important to review local press coverage of the city and state where a company is based or headquartered. Local coverage can be a lot more thorough, and in some cases, more critical than national coverage. Furthermore, any articles that quote company employees and executives, or press releases about the company may provide leads on people worth tracking down to learn more about the company’s inner workings.
- Regulatory and licensing records: If a company is in a business regulated by the state or federal government (or even a municipal government), the inspection certificates and any records of regulatory violations may be available to the public. This could entail filing a Freedom of Information request on the state and federal level, which may be time-consuming, but helpful nonetheless.
- Fire inspection records: City governments may have on file fire inspection certificates detailing when a company was last inspected and whether any fire code regulations were found.
- Political contributions: While corporate political contributions are not always transparent, at a bare minimum contribution search engines may provide information on the politicians and causes companies have supported.
- Security/Terrorism sanctions: Make sure to run all the company names through the U.S. Treasury’s Office of Foreign Assets Control list, as well as Interpol, the International Financial Action Task Force and UN Sanctions lists.