Law Commons^™

A Conflict Primacy Model Of The Public Board, Usha Rodrigues

Scholarly Works

e board of directors is the theoretical fulcrum of the corporate form: Statutes task the board with managing the corporation. Yet in the twentieth century, CEOs and other executives came to dominate the real-world control of the corporation. In light of this transformation, in the 1970s Melvin E. Eisenberg proposed reconceiving the board as an independent monitor. Eisenberg’s monitoring board is now the dominant regulatory model of the board. Recently two different visions of the board of directors have emerged. Stephen Bainbridge’s “director primacy” model calls directors “Platonic guardians,” and Margaret Blair and Lynn Stout’s “team production model” characterizes them …

Corporate Culture And Erm, Michelle M. Harner

Faculty Scholarship

The attitudes and actions of those viewed as leaders within a company (commonly referred to as “tone at the top”) help to define corporate culture and are critical to implementing a successful enterprise risk management (ERM) program. This paper explores the challenges and benefits of creating a risk-aware corporate culture, including the potential legal implications for boards of directors.

Leveling The International Playing Field With The Marketplace Fairness Act, Richard Thompson Ainsworth, Boryana Madzharova

Faculty Scholarship

Quill v. North Dakota unbalanced the American retail market with its preference for out-of-state over in-state sellers. The preference under Quill is that sellers without physical presence in a state cannot be compelled to collect the sales tax. If the buyer does not voluntarily remit the complementary use tax, the purchase is effectively tax-free. As a result, Quill is seen as facilitating tax avoidance and driving business to sellers who have no in-state nexus, notably e-businesses. Revenue losses are estimated in excess of $10 billion per year.

The reach of the Quill decision is international. Preferred sellers can reside just …

Arguments For And Against Territoriality, Reuven S. Avi-Yonah

Articles

The tax on dividends from the active income of controlled foreign corporations meets the criteria for a bad tax: It raises little revenue but significantly affects taxpayer behavior in undesirable ways.

Territoriality: For And Against, Reuven S. Avi-Yonah

Articles

The tax on dividends from the active income of controlled foreign corporations meets the criteria for a bad tax: It raises little revenue but significantly affects taxpayer behavior in undesirable ways.

Order On Defendants' Motion To Dismiss (Zelby), Elizabeth E. Long

Georgia Business Court Opinions

No abstract provided.

Securities Law's Dirty Little Secret, Usha Rodrigues

Scholarly Works

Securities law’s dirty little secret is that rich investors have access to special kinds of investments—hedge funds, private equity, private companies—that everyone else does not. This disparity stems from the fact that, from its inception, federal securities law has jealously guarded the manner in which firms can sell shares to the general public. Perhaps paternalistically, the law assumes that the average investor needs the protection of the full panoply of securities regulation and thus should be limited to buying public securities. In contrast, accredited—i.e., wealthy— investors, who it is presumed can fend for themselves, have the luxury of choosing between …

The Shareholder Value Myth, Lynn A. Stout

Cornell Law Faculty Publications

No abstract provided.

E-Verify Can Stop Refund Fraud, Richard Thompson Ainsworth, Andrew Shact

Faculty Scholarship

Two issues in the current Washington debates need to be linked. E-Verify, the Internet-based database that allows employers to verify an employee’s work eligibility that is at the center of the immigration debate, is the ideal tool for stopping tax refund fraud. All that is needed is a digital signature of the E-Verify result, and the mandatory inscription of this signature on tax documents to make them self-authenticating.

The central features of this proposal have been made before. The technology it requires is tried and proven. The processes and procedure it advocates are in place and effectively deployed in foreign …

Should Angel-Backed Start-Ups Reject Venture Capital?, Darian M. Ibrahim

Faculty Publications

The conventional wisdom is that entrepreneurs seek financing for their high-growth, high-risk start-up companies in a particular order. They begin with friends, family, and "bootstrapping" (e.g., credit card debt). Next they turn to angel investors, or accredited investors (and usually ex-entrepreneurs) who invest their own money in multiple, early-stage start-ups. Finally, after angel funds run dry, entrepreneurs seek funding from venture capitalists (VCs), whose deep pockets and connections lead the startup to an initial public offering (IPO) or sale to a larger company in the same industry (trade sale).

That conventional wisdom may have been the model for start-up success …

Financial System Engineering, Manuel A. Utset

Scholarly Publications

No abstract provided.

Towards A Moral Agency Theory Of The Shareholder Bylaw Power, Jay B. Kesten

Scholarly Publications

Corporate bylaws are the new leading edge of a decades-long struggle between shareholders and managers over the allocation of decision-making authority in public companies. Bylaws are the only method by which shareholders can unilaterally restrict the powers and discretion of the board. Yet the scope of this statutory authority remains notoriously uncertain. Corporate law scholars generally agree that there is a limited domain in which shareholders can restrict managerial authority, but disagree on the appropriate boundary. The Delaware Supreme Court recently confronted this issue for the first time in CA, Inc. v. AFSCME Employees Pension Plan, but that decision …

Striking The Right Balance: Investor And Consumer Protection In The New Financial Marketplace: Introduction, Lisa Fairfax, Arthur E. Wilmarth Jr

All Faculty Scholarship

On March 2, 2012, The George Washington University Law School's Center for Law, Economics & Finance and The George Washington Law Review jointly hosted a symposium entitled "Striking the Right Balance: Investor and Consumer Protection in the New Financial Marketplace."' The symposium focused on two principal topics. First, participants analyzed the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank") on investors and consumers in three areas of federal regulation-securities markets, derivatives markets, and consumer financial products. Second, the symposium evaluated the Sarbanes-Oxley Act of 2002 ("Sarbanes-Oxley") on its tenth anniversary and considered whether Sarbanes-Oxley's legacy might …

Methods For Multicountry Studies Of Corporate Governance (And Evidence From The Brikt Countries), Bernard S. Black, Antonio Gledson De Carvalho, Vikramaditya Khanna, Woochan Kim, B. Burcin Yurtoglu

Law & Economics Working Papers

We discuss the perils in multicountry studies of corporate governance (CG), focusing on emerging markets. The existing studies are massively multicountry studies, which cover many firms across many countries, but rely on the same limited governance elements in each countries, have few firm-level control variables, and use pure-cross-sectional data. This paper discusses the severe data and construct validity issues in these studies, proposes methods to respond to those issues, and applies those methods through a study of five major emerging markets (Brazil, India, Korea, Russia, and Turkey). We develop unique time-series datasets on governance in each country. We address construct …

A Reconsideration Of The Shareholder's Remedy For Oppression In Singapore, Pearlie Koh

Research Collection Yong Pung How School Of Law

The statutory remedy for oppression plays an important role in minority shareholder protection in Singapore. Both the scope of its application and the court's jurisdiction to make remedial orders must necessarily be wide in order for the remedy to be effective. Nevertheless, the remedy is not without limits. Indeed, it is crucial that the boundaries of the remedy be made clear so that legitimate rule of the majority is not too often, and erroneously, equated with tyranny by the majority. This paper considers a number of issues as to the scope of the oppression remedy in Singapore through a careful …

The Potential Cost And Value Of Erm, Michelle M. Harner

Faculty Scholarship

The concept of enterprise risk managment (ERM) as a holistic approach to managing a company's risk profile has tremendous appeal. However, companies are frequently skeptical about its value and whether the results will justify the cost, effort, and challenges of implementing a meaningful ERM process. This report considers some of those concerns and highlights the governance, compliance, and cultural value of ERM.

Trust In Beer, Andy Brunner-Brown

GGU Law Review Blog

No abstract provided.

Should The Us Dictate World Tax Policy? Reflections On Ppl, Reuven S. Avi-Yonah

Articles

The U.S. Supreme Court’s decision to grant certiorari in PPL offers it a unique opportunity to change the law regarding foreign tax credits that has significantly impeded the ability of other countries to engage in meaningful tax reform. In 1938 the Court said in dicta that to qualify for the FTC a tax had to be an income or excess profits tax (or a tax imposed in lieu thereof) under U.S. tax principles. This statement has led to an elaborate set of regulations defining what is an income tax, which has significantly hampered the ability of foreign countries to adopt …

Zappers & Employment Tax Fraud, Richard Thompson Ainsworth

Faculty Scholarship

Beyond the grey area of worker misclassifications and general employment tax irregularities there are darker employment relationships where workers are intentionally paid in cash “off-the-books” or “under-the-table.” Grey employment relationships present civil enforcement issues that may become criminal; darker-relationships are criminal from the beginning. Zappers are found on the dark side.

Zappers are fraud-technologies that automatically (and remotely) skim cash from electronic cash registers (ECRs) or back room point of sales (POS) systems. Globally, tax auditors are finding that Zappers frequently provide the cash that is used to compensate “under-the-table” workers. In fact, a Zapper appears to be at the …

Deconstructing Corporate Governance: The Mechanics Of Trusting, René Reich-Graefe

Faculty Scholarship

The phenomenon of trust among firm participants is a much neglected academic inquiry in corporate governance research and the theory of the firm. This Article elaborates on the comparatively small sample of existing legal research on the intersection of trust and corporate governance and tries to interrupt the selective (in-)attention given to the philosophical, psychological, political, sociological, economic, and legal phenomenon that is our individual as well as collective, everyday trust (or distrust) in the functionality and explainability of the world tomorrow in accordance with our preferences of today and our experiences of the past. Trust—as a phenomenon—is a concrete …

Removing Revlon, Franklin A. Gevurtz

McGeorge School of Law Scholarly Articles

This Article advocates the abolition of the Revlon doctrine— the junior partner in Delaware’s corporate takeover jurisprudence, which governs certain contests involving auctions and sales of control. Revlon arose in the twilight zone created by the overlap between defenses to hostile tender offers and efforts by directors to avoid or coerce a shareholder vote on corporate mergers and sales (shotgun corporate marriages). The narrow holding of the case stands for the common sense proposition that if directors decide to sell their corporation by choosing between two bids, both of which will pay all of the shareholders cash for all of …

'Quack Corporate Governance' As Traditional Chinese Medicine – The Securities Regulation Cannibalization Of China's Corporate Law And A State Regulator's Battle Against State Political Economic Power, Nicholas C. Howson

Law & Economics Working Papers

From the start of the PRC’s “corporatization” project in the late 1980s, a Chinese corporate governance regime subject to increasingly enabling legal norms has been determined by mandatory regulations imposed by the PRC securities regulator, the CSRC. Indeed, the Chinese corporate law system has been cannibalized by allencompassing securities regulation directed at corporate governance, at least for companies with listed stock. This article traces the path of that sustained intervention, and makes a case – wholly contrary to the “quack corporate governance” critique much aired in the U.S. – that for the PRC this phenomenon is necessary and appropriate, and …

Book Review: "Bishop & Zucker On Nevada Corporations And Llcs", Rachel J. Anderson

Scholarly Works

In this piece written for The Writ, the official publication of the Washoe County Bar Association, Prof. Rachel Anderson reviews Bishop and Zucker on Nevada Corporations & LLCs.

Responsible Shares And Shared Responsibility: In Defense Of Responsible Corporate Officer Liability, Amy J. Sepinwall

Studio for Law and Culture

When a corporation commits a crime, whom may we hold criminally liable? One obvious set of defendants consists of the individuals who perpetrated the crime on the corporation’s behalf. But according to the responsible corporate officer (RCO) doctrine – a doctrine that is growing more widespread – the state may also prosecute and punish those corporate executives who, although perhaps lacking “consciousness of wrongdoing,” nonetheless have “a responsible share in the furtherance of the transaction which the statute outlaws.” In other words, the RCO doctrine imposes criminal liability on the executive who need not have participated in her corporation’s crime; …

Conscience, Incorporated, James D. Nelson

Ira M. Millstein Center for Global Markets and Corporate Ownership

Do business corporations have free exercise rights? This question has become critically important in recent challenges to the Affordable Care Act’s so-called “contraception mandate.” A host of businesses selling ordinary goods and services claim that they cannot be compelled to provide employees with insurance that covers contraception. Courts have divided over whether corporations can assert rights of conscience, and existing theoretical accounts fail to provide guidance on this question.

This Article offers a new normative framework for evaluating corporate claims of conscience. Drawing on theories of conscience and collective rights, it develops a “social theory” of conscience that explains how …

Mickey Goes To France: A Case Study Of The Euro Disneyland Negotiations, Lauren A. Newell

Scholarly Works

No abstract provided.

Preparing "Main Street" Lawyers: Practicing Without Big Firm Experience, Lisa Reel Schmidt, Steve Garland, Robert Statchen

Faculty Scholarship

This Article is the transcript of a panel presented at Emory’s Third Biennial Conference on Transactional Education. The panelists advance two premises: First, that law schools need to teach transactional skills because many students will either focus on transactional law or practice general law where transactional skills are necessary; and second, that some of the transactional skills the schools teach should be specific to main street lawyering because a number of students will be main street lawyers. The panelists explain how the transactional skills necessary for main street lawyering differ from skills needed in litigation and big law firms. They …

The Lawyer's Toolbox: Teaching Students About Risk Allocation, Dana Malkus, Scott Stevenson, Eric J. Gouvin, Usha Rodriques

Faculty Scholarship

This Article is the transcript of a panel presented at Emory’s Third Biennial Conference on Transactional Education. The panel focuses on techniques for teaching risk allocation as part of transactional skills classes. The panelists describe their approaches to teaching risk allocation, from syllabus design to final evaluations. How can a professor help students to understand the basic concepts of risk, the role risk plays in business and legal decisions, and how they can help clients manage risk. The techniques for teaching risk allocation include hypotheticals, visual aids, and hands-on assignments. The panelists each take their students down a different path …

Transnational Business Governance Interaction And Competition Between Standard-Setting Initiatives: Labor Standards In Garment, Toys And Agriculture, Nicole Helmerich, Christopher Kaan

Transnational Business Governance Interactions Working Papers

This paper analyzes interactions within standard-setting networks in the area of social and labor rights. We examine the shape of transnational business governance interactions (TBGI), pathways, and interaction mechanisms in three sectors: garments, toys and agriculture. Our comparative analysis of each of these sectors reveals meaningful differences in both the organization of regulation networks and the resulting level of competition among participants. Overall, we find that the creation of a more inclusive and more coherent standard in a whole business sector comes with the cost of weaker rules and less monitoring. These industry-specific observations provide a springboard for future studies …

Public-Private Regime Interactions In Global Food Safety Governance, Ching-Fu Lin

Transnational Business Governance Interactions Working Papers

In response to an apparent decline in global food safety, numerous public and private regulatory initiatives have emerged to restore public confidence. This trend has been particularly marked by the growing influence of private regulators such as multinational food companies, supermarket chains and non-governmental organizations (NGOs), who employ private standards, certification protocols, third-party auditing, and transnational contracting practices. This paper explores how the structure and processes of private food safety governance interact with traditional public governance regimes, focusing on Global Good Agricultural Practices (GlobalGAP) as a primary example of the former. Due to the inefficiency and ineffectiveness of public regulation …