Agency Commons^™

Promoting Corporate Diversity: The Uncertain Role Of Institutional Investors, Jill Fisch

Seattle University Law Review

Two developments are having an impact on corporate decisions. One is the increased engagement by institutional intermediaries and a shift in the focus of that engagement from corporate governance to environmental and social issues. The other is a heightened societal awareness of diversity, equity, and inclusion (DEI) issues, particularly the importance of diversity in corporate leadership. This Article considers the intersection between the two. It describes how institutional investors have focused their attention on increasing diversity in corporate leadership, the potential motivations for that focus, and the impact of that focus, to date. It highlights the tensions that result from …

America’S Hidden Citizens: The Untold Stories Of The Unconscionable Deportations Of Its International Adoptees, Halley Cody

Seattle University Law Review

This Note addresses how the U.S. should rectify the harms it has perpetrated on non-citizen adoptees by amending the current deportation statutes to prevent their deportation. Part I addresses the history of adoption in the U.S. and related effects on immigration law. Part II highlights the stories of Adam Crapser and Philip Clay, who were adopted by American families who failed to naturalize them as minors, and who were subsequently deported after they sustained criminal records. Part III examines the policy goals behind deportation as a consequence of criminal convictions, as well as remedies instituted to prevent unwarranted deportation and …

Inadequate Privacy: The Necessity Of Hipaa Reform In A Post-Dobbs World, Katherine Robertson

Seattle University Law Review

Part I of this Comment will provide an overview of HIPAA and the legal impacts of Dobbs. Part II will discuss the anticipatory response to the impacts of Dobbs on PHI by addressing the response from (1) the states, (2) the Biden Administration, and (3) the medical field. Part III will discuss the loopholes that exist in HIPAA and further address the potential impacts on individuals and the medical field if reform does not occur. Finally, Part IV will argue that the reform of HIPAA is the best avenue for protecting PHI related to reproductive healthcare.

Universal Forms Of Influence: Support For Women On Boards, Cindy A. Schipani, Paula J. Caproni

Seattle University Law Review

There are various efforts underway to increase gender diversity on corporate boards, including legislation in California, a recent SEC approved comply or explain rule for companies listed on the Nasdaq stock exchange, and efforts by institutional investors such as State Street and BlackRock to recognize the value diversity brings to corporate decisionmaking. Although some of these efforts are being contested in the courts, many companies have begun to comply with these initiatives.

This Article is organized as follows. Part I provides an overview of several efforts to increase gender diversity on boards along with numerous research studies showcasing the benefits …

“Statistics Are Human Beings With The Tears Wiped Away”: Utilizing Data To Develop Strategies To Reduce The Number Of Native Americans Who Go Missing, Lori Mcpherson, Sarah Blazucki

Seattle University Law Review

On New Year’s Eve night, 2019, sixteen-year-old Selena Shelley Faye Not Afraid attended a party in Billings, Montana, about fifty miles west of her home in Hardin, Montana, near the Crow Reservation. A junior at the local high school, she was active in her community. The party carried over until the next day, and she caught a ride back toward home with friends in a van the following afternoon. When the van stopped at an interstate rest stop, Selena got out but never made it back to the van. The friends reported her missing to the police and indicated they …

Nestlé V. Doe: A Death Knell To Corporate Human Rights Accountability?, Phillip Ayers

Seattle University Law Review

The Supreme Court in Nestlé v. Doe held that foreign plaintiffs who claimed to be victims of overseas tortious conduct by corporate defendants had no jurisdiction to sue in federal courts using the Alien Tort Statute. This Comment looks at the history of the Alien Tort Statute, from its inspiration, long dormancy, and recent reinvigoration beginning in the 1980s. The Comment then explores the background of Nestlé and its issues with child slavery in its cocoa supply chain. From there, the Comment analyzes the Nestlé v. Doe decision, and posits an alternative outcome. Finally, this Comment looks for a new …

Corporate Governance And Gender Equality: A Study Of Comply-Or-Explain Disclosure Regulation, Aaron A. Dhir, Sarah Kaplan, Maria Arabella Robles

Seattle University Law Review

In 2020, the Nasdaq Stock Market filed a proposal with the U.S. Securities and Exchange Commission seeking permission to adopt a board diversity-related disclosure requirement for its listed companies. In 2021, the SEC approved the proposal, thus entrenching Nasdaq’s position as the most significant stock exchange to date to mandate listing rules that reflect the intention of diversifying corporate boardrooms. Nasdaq’s movement into the diversity space is not the first attempt to address homogeneous boards in the U.S. In 2009, the SEC adopted a rule requiring publicly traded firms to report on whether they consider diversity in identifying director nominees. …

Judicial Ethics And The Eradication Of Racism, Dontay Proctor-Mills

Seattle University Law Review

In 2020, the Washington Supreme Court entrusted the legal community with working to eradicate racism from its legal system. Soon after, Washington’s Commission on Judicial Conduct (hereinafter the Commission) received a complaint about a bus ad for North Seattle College featuring King County Superior Court Judge David Keenan. Along with a photo of Judge Keenan’s face, the ad included the following language: “A Superior Court Judge, David Keenan got into law in part to advocate for marginalized communities. David’s changing the world. He started at North.” The Commission admonished Judge Keenan for violating the Code of Judicial Conduct, in part …

Table Of Contents, Seattle University Law Review

Seattle University Law Review

Table of Contents

Why Corporate Boards Should Include Lgbtq+ People, Jeremy Mcclane, Darren Rosenblum

Seattle University Law Review

Corporate boardrooms sit at the heart of most of society’s most consequential decisions but fall far short of the diversity of our society. The current movement toward board diversification aims to remedy the underrepresentation of marginalized groups on corporate boards. More recently, some efforts have included LGBTQ+ people, even though the basis for their inclusion on corporate boards remains largely unstated. This Article examines both the normative and instrumental bases for LGBTQ+ inclusion in board diversity initiatives, articulating unspoken assumptions and linking LGBTQ+ people to the broader inclusion effort. In so doing, it begins to surface the unique issues LGBTQ+ …

Hidden Agendas In Shareholder Voting, Scott Hirst, Adriana Z. Robertson

Faculty Scholarship

Nothing in either corporate or securities law requires companies to notify investors what they will be voting on before the record date for a shareholder meeting. We show that, overwhelmingly, they do not. The result is “hidden agendas”: for 88% of shareholder votes, investors cannot find out what they will be voting on before the record date. This poses an especially serious problem for investors who engage in securities lending: they must decide whether the expected benefit of voting exceeds the expected benefit of continuing to lend their shares (or making them available for lending) without knowing what they will …

The Sec’S Climate Disclosure Rule: Critiquing The Critics, George S. Georgiev

Faculty Articles

Climate change is an existential phenomenon, which entails a wide variety of physical risks as well as sizeable but underappreciated economic risks. In March 2022, the U.S. Securities and Exchange Commission (SEC) moved to address some of the information gaps related to the effects of climate change on firms by proposing a rule that requires public companies to report detailed and standardized information about important climate-related matters for the benefit of investors and markets. Though the rule proposal was welcomed by many market participants, it was also met with a level of opposition that was unusual in both its intensity …

Table Of Contents, Seattle University Law Review

Seattle University Law Review

Table of Contents and Special Thanks.

The Seventh Circuit Missed The Bullseye In Walleye, Peter Rosenberg

Fordham Journal of Corporate & Financial Law

The structure of agency relationships in a transaction should have no bearing on the outcome when the only difference between two hypothetical transactions is solely the facial structure. In the same vein, investor protection is at the forefront of the securities laws; commonly used limiting language for market announcements should not be enough to absolve a company from fraudulent disclosures, e.g., “preliminary results.”

In Walleye Trading LLC v. AbbVie, Inc., a Seventh Circuit decision, the Court did the opposite and found that, based on pleadings at the motion to dismiss stage, an issuer is not liable for the misstatements …

Table Of Contents, Seattle University Law Review

Seattle University Law Review

Table of Contents

Shareholder Primacy And The Moral Obligation Of Directors, Mark J. Loewenstein, Jay Geyer

Publications

One of the most written-about and important topics in corporate law is the fiduciary obligations of corporate directors. Increasingly, critics of American capitalism have urged that corporations, and implicitly, corporate directors, act in a more socially responsible fashion and thus eschew the notion that shareholder primacy is the exclusive guide to a director’s fiduciary duty. Under this view, directors must consider the effect of their actions on “stakeholders” other than shareholders and be guided by morality—doing the right thing—when making business judgments.

When directors move away from shareholder primacy, however, decision-making becomes more difficult and problematic. This article analyzes the …

A False Sense Of Security: How Congress And The Sec Are Dropping The Ball On Cryptocurrency, Tessa E. Shurr

Dickinson Law Review (2017-Present)

Today, companies use blockchain technology and digital assets for a variety of purposes. This Comment analyzes the digital token. If the Securities and Exchange Commission (SEC) views a digital token as a security, then the issuer of the digital token must comply with the registration and extensive disclosure requirements of federal securities laws.

To determine whether a digital asset is a security, the SEC relies on the test that the Supreme Court established in SEC v. W.J. Howey Co. Rather than enforcing a statute or agency rule, the SEC enforces securities laws by applying the Howey test on a fact-intensive …

Table Of Contents, Seattle University Law Review

Seattle University Law Review

Table of Contents

The Law And Practice Of Shareholder Inspection Rights: A Comparative Analysis Of China And The United States, Randall S. Thomas, Robin Hui Huang

Vanderbilt Law School Faculty Publications

Shareholder inspection rights allow a shareholder to access the relevant documents of the company in which they hold an interest, so as to address the problem of information asymmetry and reduce the agency costs inherent in the corporate structure. While Chinese corporate governance and American corporate governance face different sets of agency cost problems, this Article shows that shareholder inspection rights play an important role in both China and the United States. On the books, while shareholder inspection rights in both countries are broadly similar, there are some important differences on issues such as the proper purpose requirement. The empirical …

Table Of Contents, Seattle University Law Review

Seattle University Law Review

Table of Contents

In Memory Of Professor James E. Bond, Janet Ainsworth

Seattle University Law Review

Janet Ainsworth, Professor of Law at Seattle University School of Law: In Memory of Professor James E. Bond.

Tepoel Lecture: Bond Trustees And The Rising Challenge Of Activist Investors, Steven L. Schwarcz

Faculty Scholarship

No abstract provided.

Competing For Votes, Kobi Kastiel, Yaron Nili

Faculty Scholarship

Shareholder voting matters. It can directly shape a corporation’s governance, operational and social policies. But voting by shareholders serves another important function—it produces a marketplace for votes where management and dissidents compete for the votes of the shareholder base. The competition over shareholder votes generates ex ante incentives for management to perform better, to disclose information to shareholders in advance, and to engage with large institutional investors.

Traditional corporate law has looked to a variety of “market forces” as a means of curbing the agency costs of public corporations. Yet, for various reasons, these market forces are, at best, an …

Table Of Contents, Seattle University Law Review

Seattle University Law Review

No abstract provided.

Activist Shareholders At De Facto Controlled Companies, Gaia Balp

Brooklyn Journal of Corporate, Financial & Commercial Law

Activist campaigns are likely to increasingly target controlled companies. Studies concerning activism at controlled companies focus on shareholder-empowering tools, such as the right to nominate and elect minority directors on the board, as a pathway for limiting the principal-principal agency problem. However, not enough attention has been paid to the distinction between de jure and de facto controlled companies. Building on a recent case concerning a leading Italian corporation, this Article analyzes the possible unexpected corporate governance consequences of successful activist intervention at de facto controlled companies, showing that, where minority shareholders are granted the right to appoint directors on …

Table Of Contents, Seattle University Law Review

Seattle University Law Review

No abstract provided.

The Regulatory Accountability Act Loses Steam But The Trump Executive Order On Alj Selection Upturned 71 Years Of Practice, Jeffrey Lubbers

Scholarly Articles in Law Reviews & Journals

No abstract provided.

Mandatory Disclosure In Primary Markets, Andrew A. Schwartz

Publications

Mandatory disclosure—the idea that companies must be legally required to disclose certain, specified information to public investors—is the first principle of modern securities law. Despite the high costs it imposes, mandatory disclosure has been well defended by legal scholars on two theoretical grounds: ‘Agency costs’ and ‘information underproduction.’ While these two concepts are a good fit for secondary markets (where investors trade securities with one another), this Article shows that they are largely irrelevant in the context of primary markets (where companies offer securities directly to investors). The surprising result is that primary offerings—such as an IPO—may not require mandatory …

The Conflicted Advice Problem: A Response To Conflicts & Capital Allocation, Gina-Gail S. Fletcher

Faculty Scholarship

No abstract provided.

The Market For Corporate Control In The Zone Of Insolvency: Symposium Introduction, Edward J. Janger

Brooklyn Journal of Corporate, Financial & Commercial Law

No abstract provided.