Partnering With Law Departments To Meet Their Compliance Needs

Wednesday, December 1, 2004 - 00:00

The Editor interviews Jennifer A. Kenton, Vice President, Sales & Marketing, CSC. Ms. Kenton has more than 18 years of corporate services industry experience and direct contact with top corporate and law firm customers.

Editor: When corporate counsel think of their compliance and governance role, they tend to think first about their role in advising and monitoring the activities of other functions in the company. Doesn't the legal department itself have essential functions that also involve compliance and governance issues?

Kenton: Yes, with the passage of Sarbanes-Oxley, legal departments have devoted considerable time to the compliance and governance obligations of corporate activities outside the legal department. However, the legal department does have essential tasks that must be carried out effectively to assure compliance with applicable laws and regulations.

The proper implementation of these legal department tasks is also a concern of a company's legal compliance system. These tasks include creating and assuring the continued existence and good standing of the corporation and other entities that are the vehicles for conducting the company's business; conducting reliable and timely due diligence; proper litigation management, including handling service of process effectively; maintaining board and committee records and facilitating effective communication with board members; and assuring that the company's domain names, trademarks, patents and the security interests in its property are appropriately protected.

These are just a few of the important areas in which CSC assists a legal department to carry out its functions in a way that meets the company's overall legal compliance standards and requirements.

Editor: First, tell us about CSC.

Kenton: To qualify to do business in a particular state within the United States, and many countries throughout the world, a company must designate, and maintain, a registered agent within that jurisdiction. The registered agent receives service of process (lawsuits and other legal documents) on behalf of the company and transmits them to designated legal executives within the company or outside counsel or both. CSC is the largest domestically owned registered agent in the world. It acquired Prentice Hall in 1995 and LexisNexisTM Document Solutions in 2003. The Company's clients range from numerous Fortune 500 company legal departments, top law firms and accounting firms to small businesses, start-ups and small law firms and accounting firms throughout the United States and internationally. Since 2001, CSC has averaged twenty new Fortune 500 clients per year, the most of any registered agent worldwide.

CSC differentiates itself from its competition through its development of leading technology in the registered agent services industry, including the first-ever fully integrated web-based technology that electronically forwards service of process documents to clients. Through its RecordsCenter technology, CSC also uses existing client information, already provided through the registered agent process, to simplify highly complex and critical legal processes relating to corporate governance and compliance, entity management, intellectual property, litigation management and other areas of corporate legal practice. Its technology enables its clients to access and manage their own secure data from their own facilities without the need for special software. The Company maintains large industrial servers and vaults for critical backup information in the event of an emergency or catastrophe.

CSC also partnered with the State of Delaware, Division of Corporations to build the state's pipeline for e-filing of corporate annual reports. Presently, about half of the thousands of e-filings done in the State of Delaware are through CSC.

Editor: You mentioned a variety of important services that CSC provides that are supportive of a legal department's compliance obligations. Perhaps you could describe some of these services in more detail as well as how CSC has used technology to make access to the information generated by these services user friendly.

In your role as registered agent for so many companies, handling service of process has traditionally been one of your most important services. How have you used technology to enhance the value of this service as well as to generally serve corporate counsel's litigation and matter management needs?

Kenton: As I mentioned, service of process is CSC's heritage. For more than a century, we've received service of process documents on behalf of corporate clients and distributed them to legal departments and their outside counsel. We now combine this history of service with the latest technology to provide our corporate clients with the ability to manage their litigation documents online.

CSC allows its clients to receive e-mail notification of process; next day delivery; custom notification, delivery and processing; online access to service of process details and history, online acknowledgement of document delivery, real time electronic tracking; and e-mail alerts of newly filed court cases.

We recognize that teams of inside and outside counsel may work on litigation matters. You no longer have to waste time and money transferring litigation documents from your registered agent to critical members of these teams; we make it possible for you to get imaged service of process delivered and circulated among team members within minutes of the original service of process.

CSC scans and uploads all service of process and attached pleadings into our electronic, web-based tool for immediate on-line access. The result is an instant reduction in the paper flow, and less time and money spent on dealing with all that paper.

Importantly, if you have an internal litigation and matter management system, CSC can integrate a secured, seamless stream of data into existing systems, eliminating time-consuming data entry and reducing your costs.

CSC provides a highly secured, confidential Web-based solution called PowerBrief that enables in-house counsel to collaborate with other lawyers on legal documents real-time. It also allows in-house counsel to bank expensive legal work product, such as briefs, memos and opinion letters in a searchable database.

Editor: As a general corporate practitioner, I have always associated your company with corporate filings. Would you describe that service?

Kenton: We assist legal departments with the filing and retrieval of the full gamut of documents required to keep the various entities used in a company's business in compliance. For example, we prepare and file essential corporate documents, such as certificates of incorporation and other formation documents, the documents necessary to qualify or register an entity to do business in other states, amendments to its formation document; and withdrawal and dissolution documents. We also obtain tax clearances and prepare and file assumed name certificates.

Editor: I understand that another important service is doing searches and assisting legal departments in asset-related filings.

Kenton: We make it possible for you to access Delaware's official entity records online - in real time - for status searches. We can check the exact name, incorporation/qualification date, registered agent information and good standing status of a corporation wherever incorporated, whether in the U.S. or Canada. Where third party access is permissible, we can search for outstanding tax reports and tax balances. We can also search trademark and patent records - as well as assumed name records for companies doing business under another name.

CSC also offers Uniform Commercial Code (UCC) filings and searches for lenders and lawyers who want to register secured interests in assets designated as collateral for business loans, or who want to confirm clear title of assets in the context of mergers and acquisitions. In June of 2003, CSC acquired LexisNexis Document Solutions (former number one provider of UCC searching and filing services), enabling CSC to offer the industry's most comprehensive UCC, motor vehicle, real estate lien, mortgage and deed and title search and filing services. As the largest provider of secured transaction services, we can serve as a single source to meet all asset-related document searching and filing needs across the U.S. and Canada.

Editor: One of the principal compliance concerns of corporate counsel is protecting a corporation's intellectual property. How can CSC help?

Kenton: Intellectual property management is becoming increasingly critical to effective operations and revenue generation among corporations today. Domain name lapse, IP theft, trademark infringement and brand encroachment are among the most serious and growing threats to businesses and their brands. An ICANN-accredited domain name registrar, CSC is the registrar of choice for large companies with complex domain name business requirements. Through RecordsCenter, CSC provides easy domain name management that prevents inadvertent lapsing of domain names, and enables customers to protect their names, trademarks and brands from cybersquatters, phishers, undesirable Web site associations and online traffic diversions, among other threats.

Editor: Tell us about CSC's virtual boardroom?

Kenton: This is a web-based application specifically designed to streamline document management and communication among board of directors or team members. It includes among its many features centralized access to documents for authorized users, a secure private location for board books and sensitive data, private document storage for individual board members, online scheduling of meetings, e-mail notification of upcoming annual meetings, and centralization of minute books and other corporate documents in a paperless environment. Being able to communicate rapidly and securely with the board and key members of management is increasingly important today when a quick response of a company to a crisis situation may be essential to mitigate its effect.

Editor: Keeping track of important corporate information and compliance requirements can be a challengingly complex task. Have you found a way to help?

Kenton: Yes. Through RecordsCenter, CSC enables clients to securely hold critical entity information necessary to overseeing and managing their company records, entities, board members and records, domain names and trademark registrations. It is the only fully integrated system in the industry. It allows real-time monitoring of the status of business entities and provides tools to assist with keeping entities in good standing and ensuring corporate compliance as required by the directors, shareholders and the law. Our revolutionary "Compliance Calendar" was the first Web-based compliance management application designed to help ensure good standing at the Secretary of State level. It includes, among other services, quick identification of annual report due dates and filing requirements in all 51 jurisdictions, an e-mail notification option that provides advance notice of required annual report and franchise tax filings and real time updates of jurisdictional changes in annual report and franchise tax filings.