Law Commons^™

Texas Gulf Sulphur And The Genesis Of Corporate Liability Under Rule 10b-5, Adam C. Pritchard, Robert B. Thompson

Articles

This Essay explores the seminal role played by SEC v. Texas Gulf Sulphur Co. in establishing Rule 10b-5’s use to create a remedy against corporations for misstatements made by their officers. The question of the corporation’s liability for private damages loomed large for the Second Circuit judges in Texas Gulf Sulphur, even though that question was not directly at issue in an SEC action for injunctive relief. The judges considered both, construing narrowly “in connection with the purchase or sale of any security,” and the requisite state of mind required for violating Rule 10b-5. We explore the choices of the …

The Elephant In The Room: Helping Delaware Courts Develop Law To End Systemic Short-Term Bias In Corporate Decision-Making, Kenneth Mcneil, Keith Johnson

Michigan Business & Entrepreneurial Law Review

Short-termism in corporate decision-making is as problematic for long-term investors as relying on a three-mile radar on a supertanker. It is totally inadequate for handling the long-term risks and opportunities faced by the modern corporation. Yet recent empirical research shows that up to 85% of the S&P 1500 have no long-term planning. This is costing pension funds and other long-term investors dearly. For instance, the small minority of companies that do long-term planning and risk management had a long-term profitability that was 81% higher than their peers during the 2001–2014 period—with less stock volatility that costs investors dearly as well. …

The Suitability Of South Africa's Business Rescue Procedure In The Reorganization Of Small-To-Medium-Sized Enterprises: Lessons From Chapter 11 Of The United States Bankruptcy Code., Mikovhe Maphiri

Michigan Business & Entrepreneurial Law Review

South African small- to medium-sized enterprises (“SMEs”) are the bread and butter of our economy. Providing much-needed employment and developing the skills of historically disadvantaged persons formally and informally are some of the most significant benefits of SMEs in a developing country such as South Africa. However, despite these significant contributions to the socioeconomic development of the country, SMEs generally have the lowest survival rates in the world as compared to large enterprises globally, resulting in high rates of business failure and the loss of jobs which these entities create. The Companies Act of 2008 replaces the previous judicial management …

The Persistent Appeal Of S Corporations: How Tax Cuts Might Not Help Small Corporations, Manas Kumar

Michigan Business & Entrepreneurial Law Review

This Note will first review the tax preferences for entity choice under the old tax regime for the sake of context. It will then compare the tax benefits of electing to C and S corporation status under the regime created by the Act. The Note will conclude with an analysis of the factors sustaining the tax appeal of pass-through firms for lower-earning businesses with special attention to the largely unaltered state of tax law and business entity choice. It proposes that the Act did not sufficiently reform the Internal Revenue Code to close up the tax advantage that high-earning corporations …

The Pharma Barons: Corporate Law's Dangerous New Race To The Bottom In The Pharmaceutical Industry, Eugene Mccarthy

Michigan Business & Entrepreneurial Law Review

In this Article, I argue that drug companies have created a highly profitable but dangerous business model by employing the same legal tactics as the nineteenth-century “robber barons,” the group of financiers who orchestrated corporate law’s infamous race to the bottom. Like these historical financiers, drug company executives have captured the legal apparatus and regulatory bodies that oversee them. In so doing, they have transformed the law from a system of governance into a set of enabling doctrines. The pharmaceutical industry has turned legislation intended to protect the public into a legal justification for marketing ineffective and unsafe prescription drugs. …

Space, The Final Frontier Of Enterprise: Incentivizing Asteroid Mining Under A Revised International Framework, Jack Heise

Michigan Journal of International Law

This Note argues that the Outer Space Treaty (the “OST”) should be modified to provide explicit permission for private entities to engage in asteroid mining while maintaining the principles of international peace and cooperation that the treaty espouses as the core of the framework governing outer space. Part I explores the current state of asteroid mining with reference to the current objectives of companies conducting missions in this realm. Part II examines the OST as applied to the enterprise of asteroid mining by private companies. Part III considers the benefits and drawbacks of various regulatory schemes to govern asteroid mining. …

Solely Beneficial: How Benefit Corporations May Change The Duty Of Care Analysis For Traditional Corporate Directors In Delaware, Dustin Womack

Michigan Business & Entrepreneurial Law Review

Rather than adding to the voluminous literature assessing the necessity of benefit corporations themselves or the possible liability of their directors, this Note concerns itself only with how benefit corporations will impact the fiduciary duty of care analysis for the directors of traditional corporations constituted in the state of Delaware. Further, this Note is only concerned with liability arising from claims alleging that a day-to-day directorial decision resulted in a breach of the duty of care. As such, this Note does not address any other potential liability predicated on other situations or duties. Finally, this Note provides general background information …

Book Review: Prosecuting Corporations For Genocide, Sarah Federman

Genocide Studies and Prevention: An International Journal

No abstract provided.

Antitrust's Unconventional Politics, Daniel A. Crane

Articles

Antitrust law stands at its most fluid and negotiable moment in a generation. The bipartisan consensus that antitrust should solely focus on economic efficiency and consumer welfare has quite suddenly come under attack from prominent voices calling for a dramatically enhanced role for antitrust law in mediating a variety of social, economic, and political friction points, including employment, wealth inequality, data privacy and security, and democratic values. To the bewilderment of many observers, the ascendant pressures for antitrust reforms are flowing from both wings of the political spectrum, throwing into confusion a conventional understanding that pro-antitrust sentiment tacked left and …

Holding U.S. Corporations Accountable: Toward A Convergence Of U.S. International Tax Policy And International Human Rights, Jacqueline Laínez Flanagan

Pepperdine Law Review

International human rights litigation underscores the inverse relationship between corporate power and corporate accountability, with recent Supreme Court decisions demonstrating increased judicial protections of corporate rights and decreased corporate accountability. This article explores these recent decisions through a tax justice framework and argues that the convergence of international human rights law and U.S. international tax policy affords alternate methods to hold corporations accountable for violations of international law norms. This article specifically proposes higher scrutiny of foreign tax credits and an anti-deferral regime targeting the international activity of U.S. corporations that use subsidiaries to shelter income and decrease taxation while …

Unilateral Corporate Regulation, William Magnuson

William J. Magnuson

Corporations today wield unprecedented power in politics and society, and they have a tremendous effect on human welfare around the globe. At the same time, they are increasingly difficult to regulate. Corporations are savvy and mobile, and they can relocate to avoid burdensome domestic regulation with surprising ease. The agility of corporations creates a dilemma for government decisionmakers seeking to balance the need to attract the wealth that corporations create with the desire to pursue other policy priorities. One potential approach that governments have used to address this dilemma is international cooperation, and a growing number of scholars have argued …

Theoretical And Practical Issues Of Introducing The Institution Of Financial Responsibility Of Legal Entities, A. Umarov, A. Ibragimova

Review of law sciences

This article describes theoretical and practical issues of introducing the institution of financial and corporate responsibility of legal entities, an analysis of foreign and national legislation in the field of regulation of liability of legal entities, and gives suggestions and recommendations aimed at improving the legal norms of corporate legislation.

Proxy Access Voting: Evaluating Proxy Access And The Recent Phenomenon Of Corporations Adopting Shareholder Protective Policies, Danielle Vukovich

San Diego International Law Journal

Shareholders hold a financial stake in a corporation, and therefore are often viewed as owners of the corporation and believed to be in control for all corporate actions. However, their powers are circumscribed. Board of directors committees nominate directors to serve the corporation and these directors have the power to select the corporation’s officers. The committees provide shareholders a slate of proposed directors that are voted on and approved at the annual shareholder meeting. Shareholders may also propose their own slate of directors, but this typically requires a proxy contest, which can be expensive due to the costs both associated …

Benefit Corporations And The Separation Of Benefit And Control, Emily R. Winston

Faculty Publications

Scholars, activists, and other observers have expressed concern about the social effects of corporate activity in the United States since as early as the nineteenth century. A recurring theme in this debate has been whether corporations’ focus on shareholder interests causes them to neglect and harm the interests of other constituencies affected by corporate activity. A recent and prominent effort to address this concern is the social enterprise movement, which is unique because it has resulted in the creation of entirely new business entities designed specifically for for-profit businesses devoted to pursuing social missions. One of the most widely adopted …

Creating Stability In The International Fashion Industry By Using Corporate Structures And Conglomerates, Joyce Boland-Devito Esq.

DePaul Business & Commercial Law Journal

Abstract:

This paper will analyze the challenges currently facing the global fashion industries as consumers change their shopping habits. During these tumultuous times, retailers should re-evaluate their organizational structures. According to the Forbes Global 2000, apparel companies make up 29 of those top businesses. For instance, a corporate structure helps businesses like TJX Companies (headquartered in Framingham, Massachusetts) – which owns TJ Maxx, Marshalls, HomeGoods and Sierra Trading Post – to operate efficiently and maintain over 1000 stores in the U.S., Canada, U.K., Ireland, Germany, Poland, Austria, The Netherlands and Australia. It sells apparel and home fashions (sheets, pillows, …

Do Institutional Owners Monitor? Evidence From Voting On Connected Transaction Proposals In Hong Kong-Listed Companies, Félix E. Mezzanotte, Simon Fung

Michigan Business & Entrepreneurial Law Review

The conventional view in Hong Kong has been that institutional owners tend to be passive owners and that they do little to monitor the companies’ management. We investigated whether the presence of institutional owners in Hong Kong-listed companies was associated with greater monitoring of management through dissent voting by hand-collecting information for a sample (n= 96) of connected transaction proposals (“CT proposals”) and of their voting outcomes, as announced in the Stock Exchange of Hong Kong during the period from 2012–14. Our study shows that voting approval rates on CT proposals were lower (i.e. greater dissent voting) when institutional owners …

How Meyer V. Uber Could Demonstrate That Uber And The Sharing Economy Fit Into Antitrust Law, Nicholas Andrew Passaro

Michigan Business & Entrepreneurial Law Review

Recently, Uber driver (and former Uber CEO) Travis Kalanick has been sued under antitrust laws. The plaintiffs argue that Mr. Kalanick and the other Uber drivers have engaged in a price fixing arrangement that violates §1 of the Sherman Act. The case, Meyer v. Uber (originally Meyer v. Kalanick), is still being litigated. This Comment will analyze each side’s potential arguments and will ultimately conclude that the court should find Uber drivers not guilty of a Sherman Act violation. This determination will be based on: the merits of the various arguments, how such a holding would fit within the …

Does The United States Still Care About Complying With Its Wto Obligations?, Reuven S. Avi-Yonah

Articles

The Tax Cuts and Jobs Act of 2017 (“TCJA”) contains a provision that on its face appears to be a blatant violation of the WTO’s Subsidies and Countervailing Measures (SCM) rules. New IRC section 250 applies a reduced 13.125% tax rate to “foreign derived intangible income” (FDII), which is defined as income derived in connection with (1) property that is sold by the taxpayer to any foreign person for a foreign use or (2) services to any foreign person or with respect to foreign property. In other words, this category comprises exports for property and services, including royalties from the …

Tax Havens As Producers Of Corporate Law, William J. Moon

Michigan Law Review

A review of Christopher M. Bruner, Re-Imagining Offshore Finance: Market-Dominant Small Jurisdictions in a Globalizing Financial World.

Incentivizing Corporate America To Eradicate Transnational Bribery Worldwide: Federal Transparency And Voluntary Disclosure Under The Foreign Corrupt Practice Act, Peter Reilly

Peter R. Reilly

In 1977, it was discovered that hundreds of U.S. companies had spent hundreds of millions of dollars in bribes to improve business overseas. In response, Congress passed the Foreign Corrupt Practices Act (FCPA), thereby making it illegal to bribe foreign officials to obtain a business advantage. A major tension has emerged between the federal agencies charged with enforcing the FCPA (i.e., the DOJ and SEC), and the corporate entities trying to stay within the legal and regulatory bounds of the statute. Specifically, while the government appears to be trying to maximize discretion and flexibility in carrying out its enforcement duties, …

The Profit And Loss Report On Animal Rights: How Profit Maximization Has Driven The Stagnation Of The Legal Identification Of Animals As Property, Anthony M. Doss

University of Massachusetts Law Review

The concern for the wellbeing and humane treatment of animals continues to grow in the United States. However, while public opinion on how animals should be treated has largely changed, the legal classification for animals has not. Nonhuman animals today, just as in centuries past, keep only a property classification in the law. This classification, which we humans assign to furniture, jewelry, and paper plates, comes with a set of legal rights held exclusively by the owner of the property. These rights bestow upon the owner the abilities to sell, use, and destroy the property as they see fit with …

Law Library Blog (February 2018): Legal Beagle's Blog Archive, Roger Williams University School Of Law

Law Library Newsletters/Blog

No abstract provided.

Beyond Intermediary Liability: The Future Of Information Platforms - Workshop Report, Tiffany Li

Faculty Scholarship

On February 13, 2018, WIII hosted the workshop, “Beyond Intermediary Liability: The Future of Information Platforms.” Leading experts from industry, civil society, and academia convened at Yale Law School for a series of non-public, guided discussions. The roundtable of experts considered pressing questions related to intermediary liability and the rights, roles, and responsibilities of information platforms in society. Based on conversations from the workshop, WIII published a free, publicly available report detailing the most critical issues necessary for understanding the role of information platforms, such as Facebook and Google, in law and society today. The report highlights insights and questions …

Holding U.S. Corporations Accountable: The Convergence Of U.S. International Tax Policy And Human Rights, Jacqueline Lainez Flanagan

Journal Articles

International human rights litigation underscores the inverse relationship between corporate power and corporate accountability, with recent Supreme Court decisions demonstrating increased judicial protections of corporate rights and decreased corporate accountability. This article explores these recent decisions through a tax justice framework and argues that the convergence of international human rights law and U.S. international tax policy affords alternate methods to hold corporations accountable for violations of international law norms. The article specifically proposes higher scrutiny of foreign tax credits and an anti-deferral regime targeting the international activity of U.S. corporations that use subsidiaries to shelter income and decrease taxation while …

Brand As Information Intermediary, Kishanthi Parella

Case Western Reserve Journal of International Law

The article describes the function of transnational corporations in many global supply chains as information intermediaries, which carries with it responsibilities and opportunities for incentivization.

The Shifting Tides Of Merger Litigation, Matthew D. Cain, Jill E. Fisch, Steven Davidoff Solomon, Randall S. Thomas

All Faculty Scholarship

In 2015, Delaware made several important changes to its laws concerning merger litigation. These changes, which were made in response to a perception that levels of merger litigation were too high and that a substantial proportion of merger cases were not providing value, raised the bar, making it more difficult for plaintiffs to win a lawsuit challenging a merger and more difficult for plaintiffs’ counsel to collect a fee award.

We study what has happened in the courts in response to these changes. We find that the initial effect of the changes has been to decrease the volume of merger …

International Lobbying Law, Melissa J. Durkee

Scholarly Works

An idiosyncratic array of international rules allows nonstate actors to gain special access to international officials and lawmakers. Historically, many of these groups were public-interest associations like Amnesty International. For this reason, the access rules have been celebrated as a way to democratize international organizations, enhancing their legitimacy and that of the rules they produce. But a focus on the classic public-law virtues of democracy and legitimacy produces a theory at odds with the facts: The international rules rules also offer access to industry and trade associations like the World Coal Association, whose principal purpose is to lobby for their …

Climate Change Litigation In The Federal Courts: Jurisdictional Lessons From California V. Bp, Gil Seinfeld

Michigan Law Review Online

On March 21 of this year, something unusual took place at a U.S. courthouse in San Francisco: a group of scientists and attorneys provided Federal District Judge William H. Alsup with a crash course in climate science. The five-hour tutorial was ordered by Judge Alsup in connection with a lawsuit that had been filed by the cities of Oakland and San Francisco (“the Cities”) against the world’s five largest producers of fossil fuels. The central issue in the case is whether the energy companies can be held liable for continuing to market fossil fuels long after they learned that such …

Corporations As Conduits: A Cautionary Note About Regulating Hypotheticals, Douglas M. Spencer

Publications

No abstract provided.

Corporate Personhood And The History Of The Rights Of Corporations: A Reflection On Adam Winkler’S Book We The Corporations: How American Businesses Won Their Civil Rights, Jack M. Beermann

Faculty Scholarship

Adam Winkler’s book We the Corporations: How American Businesses Won Their Civil Rights is an impressive work on several different levels. Because so much of the development of American constitutional law over the centuries has involved businesses, the book is a nearly comprehensive legal history of federal constitutional law. It certainly would be worthwhile reading for anyone interested in the constitutionality of economic regulation in the United States, spanning the controversies over the first and second Banks of the United States, through the Lochner era and present-day clashes over corporate campaign spending, and religiously-based exemptions to generally applicable laws such …