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Full-Text Articles in Law
The Separation Of Voting And Control: The Role Of Contract In Corporate Governance, Gabriel V. Rauterberg
The Separation Of Voting And Control: The Role Of Contract In Corporate Governance, Gabriel V. Rauterberg
Articles
The default rules of corporate law make shareholders’ control rights a function of their voting power. Whether a director is elected or a merger is approved depends on how shareholders vote. Yet, in private corporations shareholders routinely alter their rights by contract. This phenomenon of shareholder agreements—contracts among the owners of a firm— has received far less attention than it deserves, mainly because detailed data about the actual contents of shareholder agreements has been lacking. Private companies disclose little, and shareholder agreements are thought to play a trivial or nonexistent role in public companies. I show that this is false—fifteen …
Contracting Out Of The Fiduciary Duty Of Loyalty: An Empirical Analysis Of Corporate Opportunity Waivers, Gabriel Rauterberg, Eric Talley
Contracting Out Of The Fiduciary Duty Of Loyalty: An Empirical Analysis Of Corporate Opportunity Waivers, Gabriel Rauterberg, Eric Talley
Articles
For centuries, the duty of loyalty has been the hallowed centerpiece of fiduciary obligation, widely considered one of the few “mandatory” rules of corporate law. That view, however, is no longer true. Beginning in 2000, Delaware dramatically departed from tradition by granting incorporated entities a statutory right to waive a crucial part of the duty of loyalty: the corporate opportunities doctrine. Other states have since followed Delaware’s lead, similarly permitting firms to execute “corporate opportunity waivers.” Surprisingly, more than fifteen years into this reform experiment, no study has attempted to either systematically measure the corporate response to these reforms or …
Understanding Noncompetition Agreements: The 2014 Noncompete Survey Project, J. J. Prescott, Norman D. Bishara, Evan Starr
Understanding Noncompetition Agreements: The 2014 Noncompete Survey Project, J. J. Prescott, Norman D. Bishara, Evan Starr
Articles
In recent years, scholars and policymakers have devoted considerable attention to the potential consequences of employment noncompetition agreements and to whether legislatures ought to reform the laws that govern the enforcement of these controversial contractual provisions. Unfortunately, much of this interest—and the content of proposed reforms—derives from anecdotal tales of burdensome noncompetes among low-wage workers and from scholarship that is either limited to slivers of the population (across all studies, less than 1%) or relies on strong assumptions about the incidence of noncompetition agreements. Better understanding of the use of noncompetes and effective noncompetition law reform requires a more complete …
Demand For Breach, Tess Wilkinson-Ryan
Demand For Breach, Tess Wilkinson-Ryan
All Faculty Scholarship
These studies elicit behavioral evidence for how people weigh monetary and non-monetary incentives in efficient breach. Study 1 is an experimental game designed to capture the salient features of the efficient breach decision. Subjects in a behavioral lab were offered different amounts of money to break the deal they had made with a partner. 18.6% of participants indicated willingness to break a deal for any amount of profit, 27.9% were unwilling to breach for the highest payout, and the remaining subjects identified a break-point in between. Study 2 is an online questionnaire asking subjects to take the perspectives of buyers …
Sex Matters: Considering Gender In Consumer Contracts, Amy J. Schmitz
Sex Matters: Considering Gender In Consumer Contracts, Amy J. Schmitz
Faculty Publications
We hear about the so-called “War on Women” and persisting salary gaps between men and women in the popular media, but contracts scholars and policymakers rarely discuss gender. Instead, dominant voices in the contracts field often reflect classical and economics-driven theories built on assumptions of gender neutral and economically rational actors. Furthermore, many mistakenly assume that market competition and antidiscrimination legislation address any improper biases in contracting. This Article therefore aims to shed light on gender’s importance by distilling data from my own e-survey of Colorado consumers along with others’ research regarding gender differences in contract outcomes, interests and behaviors. …
Access To Consumer Remedies In The Squeaky Wheel System, Amy J. Schmitz
Access To Consumer Remedies In The Squeaky Wheel System, Amy J. Schmitz
Faculty Publications
This article explores the “Squeaky Wheel System” (“SWS”) in business-to-consumer (“B2C”) contexts, referring to merchants’ reservation of purchase remedies and other contract benefits for only the relatively few “squeaky wheel” consumers who have the requisite information and resources to persistently seek assistance. The article uncovers how this system fosters contractual discrimination and hinders consumers’ awareness and access with respect to contract remedies. It also adds empirical insights from my recent e-survey, and offers suggestions for using the internet to empower consumers of all economic and status levels with efficient and accessible means for learning about their purchase rights and asserting …
Contract Law In Modern Commercial Transactions, An Artifact Of Twentieth Century Business Life?, James J. White
Contract Law In Modern Commercial Transactions, An Artifact Of Twentieth Century Business Life?, James J. White
Articles
Diligent first year law students study contract law with a passion previously reserved for romantic objects and religious idols. Their professors lead them in extensive and difficult intellectual explorations of the wilds of contract law. There are careful analyses of why damage recovery X will stimulate performance Y, why recovery A is appropriate to encourage the aggrieved party to return to the market, and so on and so forth. Lurking behind this year long analysis are several inarticulate hypotheses: that they make rational evaluations of the threat of legal sanctions; that they respond in other varied and subtle ways to …