Business Organizations Law Commons^™

Asadi: Renegade Or Precursor Of Who Is A Whistleblower Under The Dodd-Frank Act?, Mystica M. Alexander, John O. Hayward, David Missirian

Pace Law Review

Whistleblowers have a long and honorable history. From Ralph Nader blowing the whistle on the hazards of GM’s Corvair in Unsafe at Any Speed1 in the 1960’s to Jeffrey Wigand in 1996 exposing the duplicity of the tobacco industry, whistleblowers have put conscience ahead of career and personal success to expose corporate fraud and wrongdoing. Not surprisingly, they have had to endure ridicule and ostracism as well as financial hardship. Legislation has sought to protect them from retribution, often with mixed success. The most recent legislative effort is the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) that allows …

An Approach To The Regulation Of Spanish Banking Foundations, Miguel Martínez

Miguel Martínez

The purpose of this paper is to analyze the legal framework governing banking foundations as they have been regulated by Spanish Act 26/2013, of December 27th, on savings banks and banking foundations. Title 2 of this regulation addresses a construct that is groundbreaking for the Spanish legal system, still of paramount importance for the entire financial system insofar as these foundations become the leading players behind certain banking institutions given the high interest that foundations hold in the share capital of such institutions.

Public Actors In Private Markets: Toward A Developmental Finance State, Robert Hockett, Saule Omarova

Saule T. Omarova

The recent financial crisis brought into sharp relief fundamental questions about the social function and purpose of the financial system, including its relation to the “real” economy. This Article argues that, to answer these questions, we must recapture a distinctively American view of the proper relations among state, financial market, and development. This programmatic vision – captured in what we call a “developmental finance state” – is based on three key propositions: (1) that economic and social development is not an “end-state” but a continuing national policy priority; (2) that the modalities of finance are the most potent means of …

An Efficiency-Based Explanation For Current Corporate Reorganization Practice, Kenneth M. Ayotte, David A. Skeel Jr.

Kenneth Ayotte

No abstract provided.

Bankruptcy Law As A Liquidity Provider, Kenneth Ayotte, David Skeel

Kenneth Ayotte

Since the outset of the recent financial crisis, liquidity problems have been cited as the cause behind the bankruptcies and near bankruptcies of numerous firms, ranging from Bear Stearns and Lehman Brothers in 2008 to Kodak more recently. This paper expands the prevailing normative theory of corporate bankruptcy — the Creditors’ Bargain theory — to include a role for bankruptcy as a provider of liquidity. The Creditors’ Bargain theory argues that bankruptcy law should be limited to solving problems caused by multiple, uncoordinated creditors, but focuses almost exclusively on the problem of creditor runs. We argue that two well-known problems …

Bankruptcy Or Bailouts?, Kenneth Ayotte, David Skeel

Kenneth Ayotte

The usual reaction if one mentions bankruptcy as a mechanism for addressing a financial institution’s default is incredulity. Those who favor the rescue of troubled financial institutions, and even those who prefer that their assets be promptly sold to a healthier institution, treat bankruptcy as anathema. Everyone seems to agree that nothing good can come from bankruptcy. Indeed, the Chapter 11 filing by Lehman Brothers has been singled out by many the primary cause of the severe economic and financial contraction that followed, and proof that bankruptcy is disorderly and ineffective. As a result, ad-hoc rescue lending to avoid bankruptcy …

Legal Entities As Transferable Bundles Of Contracts, Kenneth Ayotte, Henry Hansmann

Kenneth Ayotte

The large, modern business corporation is frequently organized as a complex cluster of hundreds of corporate subsidiaries under the common control of a single corporate parent. Our Article provides new theory and supportive evidence to help explain this structure. We focus, in particular on the advantages of subsidiary entities in providing the option to transfer some or all of the firm's contractual rights and obligations in the future. The theory not only sheds light on corporate subsidiaries but also illuminates a basic function of all types of legal entities, from partnerships to nonprofit corporations. We show that when, as is …

Avenues To Foreign Investment In China’S Shipping Industry—Have Lease Financing Arrangements And The Free Trade Zones Opened Markets For Foreign Non-Bank Investment?, Rick Beaumont

Rick Beaumont

No abstract provided.

Killing Conscience: The Unintended Behavioral Consequences Of "Pay For Performance", Lynn A. Stout

Lynn A. Stout

Contemporary lawmakers and reformers often argue that ex ante incentive contracts providing for large material rewards are the best and possibly only way to motivate corporate executives and other employees to serve their firms' interests. This Article offers a critique of the "pay for performance" approach. In particular, it explores why, for a variety of mutually reinforcing reasons, workplaces that rely on ex ante incentive contracts suppress unselfish prosocial behavior (conscience) and promote selfishness and opportunism. The end result may not be more efficient, but more uncooperative, unethical, and illegal employee behavior.

The Macroprudential Turn: From Institutional 'Safety And Soundness' To Systematic 'Financial Stability' In Financial Supervision, Robert C. Hockett

Robert C. Hockett

Since the global financial dramas of 2008-09, authorities on financial regulation have come increasingly to counsel the inclusion of macroprudential policy instruments in the standard ‘toolkit’ of finance-regulatory measures employed by financial supervisors. The hallmark of this perspective is its focus not simply on the safety and soundness of individual financial institutions, as is characteristic of the traditional ‘microprudential’ perspective, but also on certain structural features of financial systems that can imperil such systems as wholes. Systemic ‘financial stability’ thus comes to supplement, though not to supplant, institutional ‘safety and soundness’ as a regulatory desideratum. The move from primarily micro- …

Responses To Corporate Versus Individual Wrongdoing, Valerie P. Hans, M. David Ermann

Valerie P. Hans

For many years, researchers assumed that the public was indifferent to corporate wrongdoing, but recent surveys have discovered evidence to the contrary. Taking insights from these data a step further, this study employed an experimental design to examine whether people responded differently to corporate versus individual wrongdoers. We varied the identity of the central actor in a scenario involving harm to workers. Half the respondents were informed that a corporation caused the harm; the remainder were told that an individual did so. Respondents applied a higher standard of responsibility to the corporate actor. For identical actions, the corporation was judged …

The Contested Role Of The Civil Jury In Business Litigation, Valerie P. Hans

Valerie P. Hans

According to a recent study, several of the most frequent criticisms of the jury in business cases--that it is pro-plaintiff, that its decisions are based more on sympathy and prejudice than facts, and that it focuses on the defendant's deep pockets--appear to be unfounded.

The Jury's Response To Business And Corporate Wrongdoing, Valerie P. Hans

Valerie P. Hans

Some of the most vociferous criticisms of the jury relate to its performance in cases involving business and corporate wrongdoing. The jury's competence in such cases is assaulted on a variety of fronts. Critics question the jury's factfinding ability in cases with business and corporate parties, and doubt whether lay jurors can understand the often complex and esoteric evidence of business wrongdoing. Others claim that bias and prejudice, rather than evidence, determine jury decisions about businesses and corporations. The presumed biases cut both ways. The generally positive regard in which the public holds business is credited with creating leniency toward …

Judges, Prosecutors, Jurors, And Organized Labor: Four Perspectives Of Corporate Citizenship, Noel Beasley, Janine P. Geske, Valerie P. Hans, E. Michael Mccann, Frank Daily

Valerie P. Hans

Some people argue that the civil jury is in decline. They argue that it's not really so important to be focusing on jurors and jurors' views about corporate responsibility as it might have been in prior times. I want to raise some arguments in favor of the continuing importance of the civil jury. First of all, the cases that juries try may be very important cases in terms of the company and in terms of the role of the company vis-a-vis government regulation. Jurors are symbolic representatives of the public in the courtroom. Finding out what juries do when they …

How "Bad Law, Bad Economics And Bad Policy" Positively Shaped Corporate Behavior, Megan Wischmeier Shaner

Akron Law Review

This article begins by briefly discussing the factual background of the Omnicare decision and the majority’s opinion. Second, this article analyzes the criticism that followed, which generally falls into two broad categories: the doctrinal shortcomings in the majority’s reasoning and the negative practical implications of banning precommitment strategies. Third, this article briefly explores whether the concerns about Omnicare’s impact on merger and acquisition activity came to fruition in the ten years since the decision was issued, concluding that many did not. This article also reviews post-Omnicare case law noting that subsequent decisions of the Delaware Court of Chancery addressing Omnicare-based …

Making Sense Of Successor Liability, Marie T. Reilly

Marie T. Reilly

A firm that buys assets from another firm ordinarily does not acquire liability to the seller's creditors simply by buying its assets. This ordinary rule is subject to important exceptions. The buyer's consent triggers an exception. If a buyer agrees to assume the seller's liability to third parties, it is for that reason liable. This article considers a more controversial exception - successor liability. When a court decides that an asset acquirer should be treated as a "successor" to the transferor, it is liable for the transferor's debts as though it were the transferor.

Slides: Restoring The Acequias: Fixing What Wasn't Broken, Will Davidson

Innovations in Managing Western Water: New Approaches for Balancing Environmental, Social and Economic Outcomes (Martz Summer Conference, June 11-12)

Presenter: Will Davidson, Acequia Assistance Project

26 slides

Agenda: Innovations In Managing Western Water: New Approaches For Balancing Environmental, Social, And Economic Outcomes, University Of Colorado Boulder. Getches-Wilkinson Center For Natural Resources, Energy, And The Environment

Innovations in Managing Western Water: New Approaches for Balancing Environmental, Social and Economic Outcomes (Martz Summer Conference, June 11-12)

Many aspects of western water allocation and management are the product of independent and uncoordinated actions, several occurring a century or more ago. However, in this modern era of water scarcity, it is increasingly acknowledged that more coordinated and deliberate decision-making is necessary for effectively balancing environmental, social, and economic objectives. In recent years, a variety of forums, processes, and tools have emerged to better manage the connections between regions, sectors, and publics linked by shared water systems. In this event, we explore the cutting edge efforts, the latest points of contention, and the opportunities for further progress.

James A. Pritchard Iii, Order And Judgment On Plaintiff's Motion For Partial Summary Judgment As To Defendant Morris, Schneider, Wittstadt, Llc, Melvin K. Westmoreland

Georgia Business Court Opinions

No abstract provided.

Aereo, In-Line Linking, And A New Approach To Copyright Infringement For Emerging Technologies, Shannon Mcgovern

Catholic University Law Review

In an ever-changing technological landscape, strictly adhering to the language and definitions of the Copyright Act in cases involving emerging technologies may contravene the purpose and intent of copyright law. However, the Supreme Court’s 2014 opinion in American Broadcasting Cos. v. Aereo Inc. puts forth a commercial interest rationale that suggests copyright infringers may no longer be able to avoid liability based on perceived technological loopholes that have typically absolved online infringers of infringement liability. This Note argues that Aereo’s commercial interest rationale paves the way for a new approach to technologically complex copyright cases, particularly where in-line linking …