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Full-Text Articles in Law

Direct Versus Derivative And The Law Of Limited Liability Companies, Daniel S. Kleinberger Jan 2006

Direct Versus Derivative And The Law Of Limited Liability Companies, Daniel S. Kleinberger

Faculty Scholarship

The hybrid nature of limited liability companies causes us to re-invent, or at least re-examine, many doctrinal wheels. This Article will reexamine one of the most practical of those wheels-the distinction between direct and derivative claims in the context of a closely-held limited liability company.

Case law concerning the direct/derivative distinction is still overwhelmingly from the law of corporations, although LLC cases are now being reported with some frequency. LLC cases routinely analogize to, or borrow from, the corporate law. This Article encompasses that law, analyzes LLC developments, and argues that courts should (i) avoid the "special injury" rule ...


Senior Corporate Officers And The Duty Of Candor: Do The Ceo And Dfo Have A Duty To Inform?, Z. Jill Barclift Jan 2006

Senior Corporate Officers And The Duty Of Candor: Do The Ceo And Dfo Have A Duty To Inform?, Z. Jill Barclift

Faculty Scholarship

This article focuses on the duty to inform as a framework to assess liability of senior officers of public companies who withhold information from directors. The broadening of the definition of the duty to inform that senior officers owe directors to include an underlying affirmative duty to provide information, even when director or shareholder action is not requested, offers an opportunity for greater monitoring of corporate governance by focusing on those often most culpable. Currently, the plain language of Delaware’s delegation of authority statute protects directors who reasonably rely in good faith on the reports of corporate officers. However ...