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Business Strategists And Election Commissioners: How The Meaning Of Loyalty Varies With The Board’S Distinct Fiduciary Roles, Ethan G. Stone

Ethan G. Stone

For twenty years, Delaware courts have been developing special standards to review board decisions that interfere with hostile bids for control or the exercise of the shareholder franchise. These “Unocal” and “Blasius” doctrines seem to fit uneasily with theories of the board’s role in corporate governance, constraining board discretion too little for shareholder primacy theories and too much for board autonomy theories. Nor have the Delaware courts succeeded in fitting Unocal and Blasius comfortably with their treatment of board decisions in other contexts. In this article, I propose that these special doctrines reflect the difference between two separate functions of …