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Causation And Injury In Corporate Control Transactions: Cede & Co. V. Technicolor, Inc., Jacqueline M. Veneziani
Causation And Injury In Corporate Control Transactions: Cede & Co. V. Technicolor, Inc., Jacqueline M. Veneziani
Washington Law Review
In Cede & Co. v. Technicolor, Inc., the Delaware Supreme Court held that shareholders are not required to prove injury from corporate directors' failure to exercise due care in approving a merger transaction. Tort principles, the court stated, have no role in a business judgment rule analysis. Therefore, once shareholders prove a violation of the directors' duty of care, the burden is shifted to the directors to prove the entire fairness of the transaction despite the absence of a breach of the duty of loyalty. This Note argues that the entire fairness review of a disinterested board transaction is unworkable. …
Director Conflict Of Interest Under The Model Business Corporation Act: A Model For All States?, Peter E. Kay
Director Conflict Of Interest Under The Model Business Corporation Act: A Model For All States?, Peter E. Kay
Washington Law Review
The American Bar Association has adopted a new model director conflict of interest statute based on bright-line definitions and a rigid preclusion of judicial review. This Comment examines the statute and provides revisions that are necessary for the statute to operate as the drafters intended. The Comment also challenges the merits of the statute by arguing that its reliance on disinterested director approval procedures is an inadequate safeguard for shareholders and its emphasis on large corporations renders the statute unsuitable for the majority of corporations.