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Full-Text Articles in Law

Crowdfunding In Arkansas? Yes, You Can!, Carol Goforth Jan 2019

Crowdfunding In Arkansas? Yes, You Can!, Carol Goforth

Arkansas Law Notes

Following enactment of the Jumpstart Our Business Startups Act (also known as the JOBS Act) in 2012, the SEC expanded the options for issuers seeking an exemption from the registration requirement for the sale of securities under federal law, while simultaneously preempting inconsistent state law. One such innovation was Regulation Crowdfunding, generally referred to as Reg. CF, which currently allows compliant issuers to raise up to $1,070,000 in any 12-month period by seeking relatively small investments from a large number of investors.


Corporate Law And The Myth Of Efficient Market Control, William W. Bratton, Simone Sepe Jan 2019

Corporate Law And The Myth Of Efficient Market Control, William W. Bratton, Simone Sepe

Faculty Scholarship at Penn Law

In recent times, there has been an unprecedented shift in power from managers to shareholders, a shift that realizes the long-held theoretical aspiration of market control of the corporation. This Article subjects the market control paradigm to comprehensive economic examination and finds it wanting.

The market control paradigm relies on a narrow economic model that focuses on one problem only, management agency costs. With the rise of shareholder power, we need a wider lens that also takes in market prices, investor incentives, and information asymmetries. General equilibrium theory (GE) provides that lens. Several lessons follow from reference to this higher-order ...


Veil Piercing And The Untapped Power Of State Courts, Catherine A. Hardee Jan 2019

Veil Piercing And The Untapped Power Of State Courts, Catherine A. Hardee

Faculty Scholarship

The U.S. Supreme Court in recent years has embraced an anti-majoritarian trend toward providing constitutional protections for the elite who own or control corporations. This trend is especially troubling as it threatens to undermine the balance found in state corporate law between private ordering for internal corporate matters and government regulation to police the negative externalities of the corporate form. The Court's interventions also have the potential to leave vulnerable groups without the protection of religiously-neutral laws designed to prevent discrimination, protect workers, or provide essential services such as health care. While the U.S. Supreme Court has ...


The Futility Of Walls: How Traveling Corporations Threaten State Sovereignty, Darren Rosenblum Jan 2019

The Futility Of Walls: How Traveling Corporations Threaten State Sovereignty, Darren Rosenblum

Pace Law Faculty Publications

Inversions--mergers in which one firm merges with another abroad to avoid taxes in its home country--have spread as globalization has reduced many of the transactional costs associated with relocating. As firms acquire the power to choose the laws that govern them, they challenge the sovereignty of nation-states, who find their ability to tax and regulate firms depleted. States and firms compete in a game of cat and mouse to adapt to this new global reality. The subversion of state power by these firms reveals the futility of walls, both literal and regulatory. This Essay describes the phenomenon of these “traveling ...


The Problem Of Sunsets, Jill E. Fisch, Steven Davidoff Solomon Jan 2019

The Problem Of Sunsets, Jill E. Fisch, Steven Davidoff Solomon

Faculty Scholarship at Penn Law

An increasing percentage of corporations are going public with dual class stock in which the shares owned by the founders or other corporate insiders have greater voting rights than the shares sold to public investors. Some commentators have criticized the dual class structure as unfair to public investors by reducing the accountability of insiders; others have defended the value of dual class in encouraging innovation by providing founders with insulation from market pressure that enables them to pursue their idiosyncratic vision.

The debate over whether dual class structures increase or decrease corporate value is, to date, unresolved. Empirical studies have ...


Corporations And Businesses - Finding Info, Cleveland-Marshall College Of Law Library Jan 2019

Corporations And Businesses - Finding Info, Cleveland-Marshall College Of Law Library

Law Library Research Guides - Archived

No abstract provided.


Justice Kavanaugh, Lorenzo V. Sec, And The Post-Kennedy Supreme Court, Matthew C. Turk, Karen E. Woody Jan 2019

Justice Kavanaugh, Lorenzo V. Sec, And The Post-Kennedy Supreme Court, Matthew C. Turk, Karen E. Woody

Faculty Scholarship

This Article analyzes a recent Supreme Court case, Lorenzo v. Securities and Exchange Commission, and explains why it provides a valuable window into the Court's future now that Justice Kennedy has retired and his seat filled by Justice Brett Kavanaugh. Lorenzo is an important case that raises fundamental interpretative questions about the reach of federal securities statutes. But most significant is its unique procedural posture: when the Supreme Court issues its decision on Lorenzo in 2019, Justice Kavanaugh will be recused while the other eight Justices rule on a lower court opinion from the D.C. Circuit in which ...


Teaching Communication Skills In Transactional Simulations, Eric J. Gouvin, Katherine M. Koops, James E. Moliterno, Carol E. Morgan, Carol D. Newman Jan 2019

Teaching Communication Skills In Transactional Simulations, Eric J. Gouvin, Katherine M. Koops, James E. Moliterno, Carol E. Morgan, Carol D. Newman

Faculty Scholarship

This Article describes the role of communication exercises in transactional law and skills education, and provides several examples of such exercises. After a discussion of fundamental differences between communication in the context of litigation and transactional law, the Article discusses exercises designed to improve written communication skills, including the use of e-mail, in the context of transactional law. It follows with a similar discussion of exercises focusing on oral communication skills, including listening, interviewing, counseling, negotiation, and presentations. The Article concludes with examples of exercises combining oral and written communication skills in the context of simulated transactions.


Corporations As Semi-States, Jay Butler Jan 2019

Corporations As Semi-States, Jay Butler

Faculty Publications

When Ebola came to West Africa in 2014, Liberia could not cope. The State’s already fragile public health infrastructure was largely ineffective in responding to the illness and preventing its spread. And, the World Health Organization’s support was slow and stilted. By contrast, Firestone, a tire company that operates a vast rubber plantation in Liberia and runs its own hospital for 80,000 employees, family dependents, and persons in neighboring localities, responded to the virus much more effectively.

This Article uses Firestone’s Ebola response as an entry point to study a phenomenon too frequently overlooked. Many for-profit ...


Regulating Offshore Finance, William J. Moon Jan 2019

Regulating Offshore Finance, William J. Moon

Faculty Scholarship

From the Panama Papers to the Paradise Papers, massive document leaks in recent years have exposed trillions of dollars hidden in small offshore jurisdictions. Attracting foreign capital with low tax rates and environments of secrecy, a growing number of offshore jurisdictions have emerged as major financial havens hosting thousands of hedge funds, trusts, banks, and insurance companies.

While the prevailing account has examined offshore financial havens as “tax havens” that facilitate the evasion or avoidance of domestic tax, this Article uncovers how offshore jurisdictions enable corporations to evade domestic regulatory law. Specifically, recent U.S. Supreme Court cases restricting the ...


Cybersecurity Oversight Liability, Benjamin P. Edwards Jan 2019

Cybersecurity Oversight Liability, Benjamin P. Edwards

Scholarly Works

A changing cybersecurity environment now poses a significant corporate-governance challenge. Although some cybersecurity data breaches may be inevitable, courts now increasingly consider when a corporation's officers and directors may be held liable on theories that they acted in bad faith and failed to adequately oversee the corporation's affairs. This short essay reviews recent derivative decisions and encourages corporate boards to recognize that in an environment filled with increasing threats, a reasonable response will require devoting real resources and attention to cybersecurity issues.


Explaining Choice-Of-Entity Decisions By Silicon Valley Start-Ups, Gregg Polsky Jan 2019

Explaining Choice-Of-Entity Decisions By Silicon Valley Start-Ups, Gregg Polsky

Scholarly Works

Perhaps the most fundamental role of a business tax advisor is to recommend the optimal entity choice for nascent business enterprises. Nevertheless, even in 2018, the choice-of-entity analysis remains highly muddled. Most tax practitioners across the United States consistently recommend flow-through entities, such as LLCs and S corporations, to their clients. In contrast, a discrete group of highly sophisticated tax professionals, those who advise start-ups in Silicon Valley and other hotbeds of start-up activity, prefer C corporations.

Prior commentary has described and tried to explain this paradox without finding an adequate explanation. These commentators have noted a host of superficially ...


The Compliance Process, Veronica Root Martinez Jan 2019

The Compliance Process, Veronica Root Martinez

Journal Articles

Even as regulators and prosecutors proclaim the importance of effective compliance programs, failures persist. Organizations fail to ensure that they and their agents comply with legal and regulatory requirements, industry practices, and their own internal policies and norms. From the companies that provide our news, to the financial institutions that serve as our bankers, to the corporations that make our cars, compliance programs fail to prevent misconduct each and every day. The causes of these compliance failures are multifaceted and include general enforcement deficiencies, difficulties associated with overseeing compliance programs within complex organizations, and failures to establish a culture of ...


Learning To Be More Than A Lawyer, Carol Morgan Jan 2019

Learning To Be More Than A Lawyer, Carol Morgan

Scholarly Works

No abstract provided.


Reconstructing The Corporation: A Mutual-Control Model Of Corporate Governance, Grant M. Hayden, Matthew T. Bodie Jan 2019

Reconstructing The Corporation: A Mutual-Control Model Of Corporate Governance, Grant M. Hayden, Matthew T. Bodie

All Faculty Scholarship

The consensus around shareholder primacy is crumbling. Investors, long assumed to be uncomplicated profit-maximizers, are looking for ways to express a wider range of values in allocating their funds. Workers are agitating for greater voice at their workplaces. And prominent legislators have recently proposed corporate law reforms that would put a sizable number of employee representatives on the boards of directors of large public companies. These rumblings of public discontent are echoed in recent corporate law scholarship, which has cataloged the costs of shareholder control, touted the advantages of nonvoting stock, and questioned whether activist holders of various stripes are ...


Social License And Publicness, Hillary A. Sale Jan 2019

Social License And Publicness, Hillary A. Sale

Georgetown Law Faculty Publications and Other Works

This article deploys the sociological theory of social license, or the acceptance of a business or organization by the relevant communities and stakeholders, in the context of the board of directors and corporate governance. Corporations are generally regulated and treated as “private” actors, and corporate law falls into the zone of “private” law. The construct of the corporation as “private” allows for considerable latitude. Yet, corporate decision makers are the beneficiaries of economic and political power and, the decisions they make have impacts that extend well beyond the boundaries of the entities they represent. Using Wells Fargo and Uber as ...


California Dreaming?, Darren Rosenblum Jan 2019

California Dreaming?, Darren Rosenblum

Pace Law Faculty Publications

Over the past few years, California became the setting for shocking tales of sex inequality and abuse in Hollywood and Silicon Valley. Decades after women achieved educational parity. men still run the corporate world. In response to these stories exposed by the #MeToo movement, California joined the transnational corporate board quota movement by converting its voluntary quota into a hard one. Will California's first mover status overcome constitutional objections and inspire other jurisdictions to act. Or is just Utopian dreaming, California-style? This Essay argues that despite its many flaws, the quota may succeed in curbing male over-representation on corporate ...


A One-Size-Fits-All Approach To Corporate Governance Codes And Compliance By Smaller Listed Firms: An Examination Of Companies Listed In Hong Kong And Singapore, Christopher C. H. Chen Jan 2019

A One-Size-Fits-All Approach To Corporate Governance Codes And Compliance By Smaller Listed Firms: An Examination Of Companies Listed In Hong Kong And Singapore, Christopher C. H. Chen

Research Collection School Of Law

This article examines the impact of aone-size-fits-all corporate governance code on smaller listed firms, which shouldhave fewer resources to hire more qualified independent directors for theirboards and board committees. After examining data from a sample of companieslisted in Hong Kong and Singapore, we find some limited support for these resources-basedarguments. While smaller firms do not necessarily have a lower proportion ofboard members who are independent directors, some evidence suggests that smallerfirms do pay less to independent directors and that these directors have toserve on multiple board committees. Although many larger firms also share theproblem of overloading their independent directors, the ...


The Dark Side Of Implementing Basel Capital Requirements: Theory, Evidence, And Policy, Aurelio Gurrea-Martinez, Nydia Remolina Jan 2019

The Dark Side Of Implementing Basel Capital Requirements: Theory, Evidence, And Policy, Aurelio Gurrea-Martinez, Nydia Remolina

Research Collection School Of Law

Most fnancial systems around the world have imposed new capital requirements for banks in the past years. This policy seems to be justifed on two powerful economic grounds. First, better capitalized banks promote fnancial stability by reducing banks' incentives to take risks and increasing banks' buffers against losses. Second, lack of compliance with a set of rules established by the Basel Committee may harm confdence on a country's fnancial system. While acknowledging these potential benefts, this paper makes the ofen overlooked point that the full implementation of Basel capital requirements may be socially undesirable for poorer countries seeking to ...


Mens Rea Reform And Its Discontents, Benjamin Levin Jan 2019

Mens Rea Reform And Its Discontents, Benjamin Levin

Articles

This Article examines the debates over recent proposals for “mens rea reform.” The substantive criminal law has expanded dramatically, and legislators have criminalized a great deal of common conduct. Often, new criminal laws do not require that defendants know they are acting unlawfully. Mens rea reform proposals seek to address the problems of overcriminalization and unintentional offending by increasing the burden on prosecutors to prove a defendant’s culpable mental state. These proposals have been a staple of conservative-backed bills on criminal justice reform. Many on the left remain skeptical of mens rea reform and view it as a deregulatory ...


Innovating Inclusion: The Impact Of Women On Private Company Boards, Jennifer S. Fan Jan 2019

Innovating Inclusion: The Impact Of Women On Private Company Boards, Jennifer S. Fan

Articles

Eight percent—that is the percentage of women who serve on the boards of directors of private high technology companies. Private companies, particularly high technology companies, have transformed citizens’ daily lives, while the unprecedented availability of private capital has allowed those companies to remain private longer. This rise, however, has also obscured some of the weaknesses of private companies, which are not subject to public disclosure and regulatory oversight: rampant sexual harassment, the lack of women leaders in technology companies, the relative absence of female venture capitalists, and the dearth of female board members, to name a few. Yet thus ...


Being True To Trulia: Do Disclosure-Only Settlements In Merger Objection Lawsuits Harm Shareholders?, Eric L. Talley, Giuseppe Dari‐Mattiacci Jan 2019

Being True To Trulia: Do Disclosure-Only Settlements In Merger Objection Lawsuits Harm Shareholders?, Eric L. Talley, Giuseppe Dari‐Mattiacci

Faculty Scholarship

A significant debate within mergers and acquisitions law concerns the explosive popularity of the “merger objection lawsuit” (MOL), a shareholder action seeking to enjoin an announced deal on fiduciary duty grounds. MOLs blossomed during the Financial Crisis, becoming popularly associated with “shareholder shakedowns,” whereby quick-triggered plaintiff attorneys would file against – and then rapidly settle with – acquirers, typically on non-monetary terms containing modest added disclosures in exchange for blanket class releases and attorney fee awards. This practice unleashed a torrent of criticism from lawyers, commentators, academics, and (ultimately) judges, culminating in a doctrinal shift in Delaware law in the January 2016 ...


Negotiating The Lender Of Last Resort: The 1913 Federal Reserve Act As A Debate Over Credit Distribution, Nadav Orian Peer Jan 2019

Negotiating The Lender Of Last Resort: The 1913 Federal Reserve Act As A Debate Over Credit Distribution, Nadav Orian Peer

Articles

“Lending of last resort” is one of the key powers of central banks. As a lender of last resort, the Federal Reserve (the “Fed”) famously supports commercial banks facing distressed liquidity conditions, thereby mitigating destabilizing bank runs. Less famously, lender-of-last-resort powers also influence the distribution of credit among different groups in society and therefore have high stakes for economic inequality. The Fed’s role as a lender of last resort witnessed an unprecedented expansion during the 2007–2009 Crisis when the Fed invoked emergency powers to lend to a new set of borrowers known as “shadow banks”. The decision proved ...


Long-Term Bias, Eric L. Talley, Michal Barzuza Jan 2019

Long-Term Bias, Eric L. Talley, Michal Barzuza

Faculty Scholarship

An emerging consensus in certain legal, business, and scholarly communities maintains that corporate managers are pressured unduly into chasing short-term gains at the expense of superior long-term prospects. The forces inducing managerial myopia are easy to spot, typically embodied by activist hedge funds and Wall Street gadflies with outsized appetites for next quarter’s earnings. Warnings about the dangers of “short termism” have become so well established, in fact, that they are now driving changes to mainstream practice, as courts, regulators and practitioners fashion legal and transactional constraints designed to insulate firms and managers from the influence of investor short-termism ...


Board 3.0 – An Introduction, Ronald J. Gilson, Jeffrey N. Gordon Jan 2019

Board 3.0 – An Introduction, Ronald J. Gilson, Jeffrey N. Gordon

Faculty Scholarship

This paper sketches out the case for a new board model, Board 3.0, as an option for public company boards. The goal is to develop a model of thickly informed, well-resourced, and highly motivated directors who could credibly monitor managerial strategy and operational skill in cases where this would be particularly valuable. Unlike the present board model of thinly informed, under-resourced, and boundedly motivated directors, Board 3.0 directors could credibly defend management against shareholder activist incursions, where appropriate, with institutional investor owners. Similarly, such directors could find a place in extremely complex enterprise, such as finance, where the ...


Soft And Hard Strategies: The Role Of Business In The Crafting Of International Commercial Law, Susan Block-Lieb Jan 2019

Soft And Hard Strategies: The Role Of Business In The Crafting Of International Commercial Law, Susan Block-Lieb

Faculty Scholarship

Part I returns to the classic definition of hard international law initially put forward by Kenneth Abbott and Duncan Snidal and related IR scholars and analyzes existing commercial law treaties in light of this definition. It concludes that virtually none of these commercial law treaties constitute “hard” international law because nearly all commercial law treaties rely on national courts for enforcement. But Abbott and Snidal’s focus on the extent to which international law is legalized—and especially the extent to which it is enforced by international actors—may matter less with commercial than other more public international lawmaking. This ...


Aliera Healthcare, Inc., Order Entering Temporary Restraining Order, Alice D. Bonner Dec 2018

Aliera Healthcare, Inc., Order Entering Temporary Restraining Order, Alice D. Bonner

Georgia Business Court Opinions

No abstract provided.


Fiduciary Blind Spot: The Failure Of Institutional Investors To Prevent The Illegitimate Use Of Working Americans' Savings For Corporate Political Spending, Leo E. Strine Jr. Dec 2018

Fiduciary Blind Spot: The Failure Of Institutional Investors To Prevent The Illegitimate Use Of Working Americans' Savings For Corporate Political Spending, Leo E. Strine Jr.

Faculty Scholarship at Penn Law

For decades, American workers have been subjected to increasing pressure to become forced capitalists, in the sense that to provide for retirement for themselves, and to pay for college for their children, they must turn part of their income every month over to mutual funds who participate in 401(k) and 529 programs. These “Worker Investors” save for the long term, often hold portfolios that are a proxy for the entire economy, and depend on the economy’s ability to generate good jobs and sustainable growth in order for them to be able to have economic security. In recent years ...


Nancy Johnson Order On Certain Discovery Related Motions, Objections And Requests, Melvin Westmoreland Dec 2018

Nancy Johnson Order On Certain Discovery Related Motions, Objections And Requests, Melvin Westmoreland

Georgia Business Court Opinions

No abstract provided.


Marc Mccord, Order On Pending Discovery Motions, Alice D. Bonner Dec 2018

Marc Mccord, Order On Pending Discovery Motions, Alice D. Bonner

Georgia Business Court Opinions

No abstract provided.