Law Commons^™

The Business Judgment Rule, Disclosure, And Executive Compensation, D. A. Jeremy Telman

Law Faculty Publications

Despite its ubiquity in corporate law, the business judgment rule remains a doctrinal puzzle. Both courts and scholars offer different understandings of the Rule's role in litigation brought against corporate directors and different justifications for its deployment to insulate such directors from liability for breaches of fiduciary duties. This Article rejects all existing justifications for the Rule and argues that the Rule is no longer needed to protect directors from liability either because the justifications offered never made any sense or because directors are now protected by other, statutory means. Rather, the Rule is needed today not to protect directors, …