Law Commons^™

Cancellazione Delle Società Di Capitali E Responsabilità Di Soci E Liquidatori, Valerio Sangiovanni

Valerio Sangiovanni

No abstract provided.

"Because That's Where The Money Is": A Theory Of Corporate Legal Compliance, William Bradford

william bradford

Upon his capture in 1934, the legendary bank robber Willie Sutton was asked by FBI agents, Why do you rob banks, Willie? Sutton, who believed the question to be rhetorical, replied, dryly, Because that's where the money is. In other words, Sutton understood his interrogator to be inquiring as to why he robbed banks rather than, say, homes, or gas stations, or church offering plates. Had he understood the query as intended - i.e., what was it about Willie Sutton the impelled Willie Sutton to crime when many others, struggling to survive the Great Depression, were not? - Sutton could …

Where Did My Privilege Go? Congress And Its Discretion To Ignore The Attorney-Client Privilege, Don Berthiaume, Jeffrey Ansley

Don R Berthiaume

“The right to counsel is too important to be passed over for prosecutorial convenience or executive branch whimsy. It has been engrained in American jurisprudence since the 18th century when the Bill of Rights was adopted... However, the right to counsel is largely ineffective unless the confidential communications made by a client to his or her lawyer are protected by law.”[1] So said Senator Arlen Specter on February 13, 2009, just seven months before Congress chose to ignore the very privilege he lauded. Why then, if the right to counsel is as important as Senator Specter articulated, does Congress maintain …

Guilty By Proxy: Expanding The Boundaries Of Responsibility In The Face Of Corporate Crime, Amy J. Sepinwall

Amy J. Sepinwall

The BP oil spill and financial crisis share in common more than just profound tragedy and massive clean-up costs. In both cases, governmental commissions have revealed widespread wrongdoing by individuals and the entities for which they work. The public has demanded justice, yet the law enforcement response in both cases has been underwhelming. In particular, no criminal indictments have been sought for any of the corporations responsible for the Macondo oil rig explosion or the Wall Street banks involved in the financial meltdown.

This governmental restraint reflects a deep-seated ambivalence about corporate criminal liability. Though scholars have been debating the …

Corporate Governance And Accountability, Renee M. Jones

Renee Jones

This book chapter on Corporate Governance and Accountability is a contribution to the book CORPORATE GOVERNANCE - SYNTHESIS OF THEORY, RESEARCH, AND PRACTICE (Wiley, forthcoming 2010), edited by Ronald Anderson and H. Kent Baker. This chapter describes the sources of corporate governance standards for American corporations and analyzes the accountability mechanisms designed to ensure that corporate officials act faithfully in their management of corporate affairs. The chapter focuses on the financial reporting system under the U.S. securities laws which forms the foundation of the accountability system, and discusses structures and rules designed to ensure the integrity of financial reporting. The …

Legitimacy And Corporate Law: The Case For Regulatory Redundancy, Renee M. Jones

Renee Jones

This article provides a democratic assessment of the corporate law making structure in the United States. It draws upon the basic democratic principle that those affected by legal rules should have a voice in determining the substance of those rules. Although other commentators have noted certain undemocratic aspects of corporate law, this Article is the first to present a comprehensive assessment of the corporate regulatory structure from the perspective of democracy. It departs from prior accounts by looking past the states' role to consider the ways that federal regulation shores up the legitimacy of the overarching structure. This focus on …

The Role Of Good Faith In Delaware: How Open-Ended Standards Help Delaware Preserve Its Edge, Renee M. Jones

Renee Jones

This Article traces the development of the good faith doctrine in Delaware and links shifts in the doctrine to events occurring in the national economy and in Washington. It shows that in 2003 Delaware judges seemed open to the possibility of imposing liability on directors in a case (Disney) where facts suggested that the directors were overly passive in approving the terms of an employment contract for a senior corporate executive. After the 2001-2002 corporate governance scandals faded, however, the courts abandoned this course. A trio of decisions in Disney, Stone v. Ritter, and Lyondell reiterated what had long been …

Corporate Law And The Rhetoric Of Choice, Kent Greenfield

Kent Greenfield

Rhetorically, the notion of choice has always been a powerful one in politics and law. This essay is intended to offer a note of caution about its use. Despite its progressive hue of individual freedom, the rhetoric of choice increasingly tends to be a notion used to defend and uphold existing matrices of economic and social power. This is because the rhetoric of choice is an excellent way to support exiting power relationships. The assertion that people acting within such power relationships are simply choosing their current situation undermines efforts to change those relationships. The powerful stay powerful; the weak …

Reclaiming Corporate Law In A New Gilded Age, Kent Greenfield

Kent Greenfield

Corporate law matters. Traditionally seen as the narrow study of the relationship between managers and shareholders, corporate law has frequently been relegated to the margins of legal discussion and political debate. The marginalization of corporate law has been especially prevalent among those who count themselves as progressives. While this has not always been true, in the last generation or so progressives have focused on constitutional law and other areas of so-called public law, and have left corporate law to adherents of neoclassical law and economics. To the extent that the behavior of businesses has been a matter of concern, that …

The Secret Of Growth Is Financing Secrets: Corporate Law And Growth Economics, Robert D. Cooter, Hans Bernd Schaefer

Robert Cooter

Innovative businesses unite capital and new ideas, which requires overcoming the double trust dilemma -- investors fear losing their wealth and innovators fear losing their ideas. To overcome this dilemma, 17th century spice traders invented the joint stock company with an essential feature of modern corporations: entitlements to marketable shares of future profits. Using the corporate form, innovative business ventures can often be organized so that innovators expect to earn more from their share of profits than from stealing the investors’ money, and investors expect to earn more by preserving the company’s secrets than disseminating them. The corporation thus provides …

The Moral Hazard Problem In Global Economic Regulation, Frank J. Garcia

Frank J. Garcia

Global regulation of international business transactions presents a particular form of the moral hazard problem. Global firms use economic and political power to manipulate state and state-controlled multilateral regulation to preserve their opportunity to externalize the social costs of global economic activity with impunity. Unless other actors can effectively counter this at the national and global regulatory levels, globalization re-creates the conditions for under-regulated or “robber baron” capitalism at the global level. This model of economic activity has been rejected at the national level by the same modern democratic capitalist states which currently dominate globalization, creating a crisis of legitimacy …

Save The Economy: Break Up The Big Banks And Shape Up The Regulators, Charles W. Murdock

Charles W. Murdock

Save the Economy: Break Up the Big Banks and Shape Up the Regulators

The U.S. economy is still reeling from the financial crisis that exploded in the fall of 2008. This article asserts that the big banks were major culprits in causing the crisis, by funding the non-bank lenders that created the toxic mortgages which the big banks securitized and sold to unwary investors. Paradoxically, banks which were then too big to fail are even larger today.

The article briefly reviews the history of banking from the Founding Fathers to the deregulatory mindset that has been present since 1980. It …

The Misuse Of Tax Incentives To Align Management-Shareholder Interests, James R. Repetti

James R. Repetti

The U.S. tax system contains many provisions which are intended to align management of large publicly traded companies more closely to stockholders. This article shows that many of the tax provisions that have been adopted are of questionable effectiveness because they fail to address the complexities of stockholder-management relations in attempting to motivate management to act in the best interests of stockholders. The article proposes that rather than Congress attempting to identify the best way that it can use the tax system to motivate management, Congress should eliminate tax provisions which subsidize management's inefficiencies in order to encourage stockholders, themselves, …

Understanding Csr: An Empirical Study Of Private Self-Regulation, Benedict Sheehy

Benedict Sheehy

Abstract: The article is a study of an important burgeoning form of regulation—private self-regulation—in the area of Corporate Social Responsibility (CSR). Rather than taking a purely theoretical approach or a social scientific study relying publicly reported data, the article addresses the issue by way of interview based case studies. As a study in regulation it clarifies the difference between various types of self-regulation, trade associations’ codes as private self-regulation and government sponsored self-regulation. This distinction hampers efforts to understand the important aspects of motivation and compliance. This study provides empirical examination of compliance in private self-regulation. Given the impact and …

Fiduciary Relationships Are Not Contracts, Scott Fitzgibbon

Scott T. FitzGibbon

No abstract provided.

Fannie Mae And Freddie Mac; Legal Implications For A Successor Cooperative, Michael E. Murphy

Michael E Murphy

A financial cooperative of mortgage originators is capable of assuming the core securitization functions of Fannie Mae and Freddie Mac as part of a scheme to dismantle these institutions. Such a cooperative would offer advantages in maintaining adequate capitalization and in providing an effective governance structure. A federally chartered, Subchapter T cooperative appears preferable for this purpose.

Fannie Mae And Freddie Mac; Legal Implications For A Successor Cooperative, Michael E. Murphy

Michael E Murphy

A financial cooperative of mortgage originators is capable of assuming the core securitization functions of Fannie Mae and Freddie Mac as part of a scheme to dismantle these institutions. Such a cooperative would offer advantages in maintaining adequate capitalization and in providing an effective governance structure. A federally chartered, Subchapter T cooperative appears preferable for this purpose.

Fannie Mae And Freddie Mac: Legal Implications Of A Successor Cooperative, Michael E. Murphy

Michael E Murphy

A financial cooperative of mortgage originators is capable of assuming the core securitization functions of Fannie Mae and Freddie Mac as part of a scheme to dismantle these institutions. Such a cooperative would offer advantages in maintaining adequate capitalization and in providing an effective governance structure. A federally chartered, Subchapter T cooperative appears preferable for this purpose.

Checking The Staats: How Long Is Too Long To Give Adequate Public Notice In Broadening Reissue Patent Applications?, David M. Longo

David M. Longo

No abstract provided.

Does Shareholder Proxy Access Damage Share Value In Publicly Traded Companies?, J.W. Verret, Thomas Stratmann

John W Verret

The field of corporate governance has long considered the costs of the separation of ownership from control in publicly traded corporations and the regulatory and market structures designed to limit those costs. The debate over the efficiency of regulations designed to limit agency costs has recently focused on the SEC’s new rule requiring companies to include shareholder nominees on the company financed proxy statement to facilitate insurgent challengers to incumbent board members in board elections. A recent vein of empirical literature has examined the stock price effects of events surrounding the new proxy access rule. We present a study that …

The Myth Of Investor Protection: The Dodd-Frank Act And The Office Of The Investor Advocate, Chelsea Ferrette

Chelsea P. Ferrette

Are security investors protected when investor advocacy is a form of regulation? This article asks that question and answers “no.” This article looks at the SEC’s Office of the Investor Advocate (“OIA”) mandated by the Dodd-Frank Act of 2010. The OIA’s prime-objective is the advocacy and protection of investors. The OIA plans to meet its objective by ensuring retail investors’ interests are adequately represented, assisting them in conflict resolution, and identifying areas where regulatory changes benefit investors. This article posits, however, that the OIA cannot achieve its goals, because, first, the ever-increasing complexity of financial securities; second, the conflicts of …

Strategic Management And The Role Of Legal Norms In Creating Corporate Value, Nadelle Grossman

Nadelle Grossman

Delaware corporate law currently requires that directors oversee their firm’s systems to monitor risk so that they can limit their firm’s losses from such risks. Corporate law does not, however, require either directors or officers to oversee the interrelated process of managing that firm’s strategy for gains. Yet managing both risk and strategy are essential to a firm in creating value. In fact, as I argue in the paper, the current focus by business courts and academic commentators only on risk management oversight to prevent losses could actually undermine a firm’s management of its strategy for gains. I therefore propose …

The Practical Soul Of Business Ethics: The Corporate Manager's Dilemma And The Social Teaching Of The Catholic Church, Leo L. Clarke, Bruce P. Frohnen, Edward C. Lyons

Edward C. Lyons

This Article focuses on and attempts to dispel an overly narrow view of the moral responsibilities of corporations and their managers. Many businessmen and lawyers, relying on prevailing approaches to business ethics, labor under the misperception that the moral ladder in the business world has only one rung: "Be honest." Americans, however, should, can and do expect more from the managers of our large corporations, and virtually every Fortune 100 company publicly espouses a "social responsibility" far exceeding mere honesty. Further, as is demonstrated, American jurisprudence is consistent with those expectations. This Article's thesis is that Catholic Social Teaching provides …

Codifying Bankruptcy Law's Fastpass: New Value And The Absolute Priority Rule, David P. Hamm Jr

David P Hamm Jr

The notion behind the absolute priority rule is not novel to any of us. We all learned at a very young age that if someone is in front of you in line—they get served first. This basic notion of fairness affects our lives in several everyday contexts—including bankruptcy. The people in the “bankruptcy” line are the holders of interests in the debtor. If the interest held by party A is “senior” to that of party B, then party A is in front of party B in line. The absolute priority rule essentially provides that the party A must be paid …

Fannie Mae And Freddie Mac: Legal Implications Of A Successor Cooperative, Michael E. Murphy

Michael E Murphy

A financial cooperative of mortgage originators is capable of assuming the core securitization functions of Fannie Mae and Freddie Mac as part of a scheme to dismantle these institutions. Such a cooperative would offer advantages in maintaining adequate capitalization and in providing an effective governance structure. A federally chartered, Subchapter T cooperative appears preferable for this purpose.

Strategic Management And The Role Of Legal Norms In Creating Corporate Value, Nadelle Grossman

Nadelle Grossman

Delaware corporate law currently requires that directors oversee their firm’s systems to monitor risk so that they can limit their firm’s losses from such risks. Corporate law does not, however, require either directors or officers to oversee the interrelated process of managing that firm’s strategy for gains. Yet managing both risk and strategy are essential to a firm in creating value. In fact, as I argue in the paper, the current focus by business courts and academic commentators only on risk management oversight to prevent losses could actually undermine a firm’s management of its strategy for gains. I therefore propose …

Held Hostage: How The Banking Sector Has Distorted Financial Regulation And Destroyed Technological Progress, Aaron Greenspan

Aaron Greenspan

In 2008, a global financial crisis second only to the Great Depression shed light on the utterly dysfunctional system of financial regulation governing the United States. A cacophony of laws and agencies, charged with regulating retail and investment banks, ultimately failed to prevent (and ultimately accelerated) an epic economic disaster that required enormous taxpayer bailouts of private enterprise, sunk two investment banks (Lehman Brothers and Bear Stearns), imploded an enormous insurance provider (A.I.G.), leveled the American auto industry (General Motors and Chrysler), and destroyed the student loan and mortgage industries, among many, many others. Drafted quickly amidst the wreckage, the …

Eliminating Wall Street's Safety Net: How A Systemic Risk Premium Can Solve "Too Big To Fail", Jason Rudderman

Jason Rudderman

Eliminating Wall Street’s Safety Net: How a Systemic Risk Premium Can Solve “Too Big to Fail” The financial crisis of 2007 – 2009 sent the United States and the global economy into its worst recession since the great depression. Large, interconnected financial and non-financial institutions were at the center of the financial crisis. The institutions highly leveraged positions during the crisis led the government to take extreme measures, including bailing out some of these “too big to fail,” but failing institutions. The crisis led the United States Congress to pass the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank …

Criminal Affirmance: Going Beyond The Deterrence Paradigm To Examine The Social Meaning Of Declining Prosecution Of Elite Crime, Mary Kreiner Ramirez

mary k ramirez

Recent financial scandals and the relative paucity of criminal prosecutions in response suggest a new reality in the criminal law system: some wrongful actors appear above the law and immune from criminal prosecution. As such, the criminal prosecutorial system affirms much of the wrongdoing giving rise to the crisis. This leaves the same elites undisturbed at the apex of the financial sector, and creates perverse incentives for any successors. Their position of power results in massive deadweight losses for the entire economy as a result of their crimes. Further, this undermines the legitimacy of the rule of law and encourages …

Fannie Mae And Freddie Mac: Legal Implications Of A Successor Cooperative, Michael E. Murphy

Michael E Murphy

A financial cooperative of mortgage originators is capable of assuming the core securitization functions of Fannie Mae and Freddie Mac as part of a scheme to dismantle these institutions. Such a cooperative would offer advantages in maintaining adequate capitalization and could provide an effective governance structure. A federally chartered, Subchapter T cooperative appears preferable for this purpose.