Business Organizations Law Commons^™

Are Corporate Officers Advised About Fiduciary Duties, Lyman P.Q. Johnson

Scholarly Articles

This Article reports the results of an empirical study of whether and how in-house corporate counsel advise corporate officers about fiduciary duties. The fiduciary duties of officers long have been neglected by courts, scholars, and lawyers, as the Introduction explains, even though executives play a central role in corporate success and failure. The study’s findings, organized by type of company (public or private), size, and attorney position within the firm, show several interesting patterns in advice-giving practices. For example, fewer than half of all respondents provided advice to officers below the senior-most rank. The results raise the possibility that, unlike …

Corporate Law Professors As Gatekeepers, Lyman P. Q. Johnson

Scholarly Articles

None available.

Counter-Narrative In Corporate Law: Saints And Sinners, Apostles And Epistles, Lyman P.Q. Johnson

Scholarly Articles

Corporate law is bi-vocal. On the one hand, liberating and amoral statutes permit a master narrative of business persons eagerly pursuing the good life as they see it. The mixture of such lax law and human frailty frequently leads to the unleashing of boundless ambition, vanity, avarice, duplicity, and much mischief. On the other hand, another voice in corporate law occasionally moves into the foreground to interrupt and tell its own story – a counter-narrative demanding a measure of self-restraint – when those who direct or manage company affairs press self-gain (or sloth) to the point of intolerable excess. The …

Option Backdating And Its Implications, Jesse M. Fried

Washington and Lee Law Review

Thousands of U.S. companies appear to have secretly backdated stock options. This Article analyzes three forms of secret option backdating: (1) the backdating of executives' option grants; (2) the backdating of nonexecutive employees' option grants; and (3) the backdating of executives' option exercises. It shows that each type of backdating less likely reflects arm's length contracting than a desire to inflate and camouflage executive pay. Secret backdating thus provides further evidence that pay arrangements have been shaped by executives' influence over their boards. The fact that so many firms continued to secretly backdate after the Sarbanes-Oxley Act, in blatant violation …

A Fresh Look At Director "Independence": Mutual Fund Fee Litigation And Gartenberg At Twenty-Five, Lyman P.Q. Johnson

Scholarly Articles

This article contrasts how a robust conception of director independence plays a central role in the corporate law world while, in the mutual fund industry, independence is a shrunken conception playing only a marginal role. Over the last twenty-five years, director independence in corporate law has gained wide acceptance as being desirable and it has become a critical component of fiduciary duty analysis. Within the mutual fund industry, however, independence remains fiercely contested. The more obvious battle over independence has occurred in response to the Securities and Exchange Commission's ("SEC's") rulemaking effort to alter the standard for granting certain regulatory …

Show Me The Money: The Thompson Memo, Stein, And An Employee's Right To The Advancement Of Legal Fees Under The Mcnulty Memo, John Power

Washington and Lee Law Review

No abstract provided.

Piercing The Corporate Veil, Financial Responsibility, And The Limits Of Limited Liability, David K. Millon

Scholarly Articles

Veil-piercing is the most heavily litigated issue in corporate law, yet legal doctrine in this area is notoriously incoherent. In this article, I argue that the only way to make sense of veil-piercing is through an accurate understanding of the policy underlying limited liability. Once that is appreciated it then becomes possible to make sense of the appropriate limits on limited liability. Piercing the corporate veil can then serve the useful function of distinguishing legitimate from illegitimate reliance on statutory limited liability.

After surveying efficiency rationales for limited liability and finding them unpersuasive, I propose that the best way to …

Criminalization Of Corporate Law: The Impact On Shareholders And Other Constituents, David K. Millon

Scholarly Articles

None available.

(Not) Advising Corporate Officers About Fiduciary Duties, Lyman P.Q. Johnson, Robert V. Ricca

Scholarly Articles

This Article explores the intersection of an important, unresolved corporate law issue and an overlooked professional responsibility issue persistently arising in the corporate milieu. The corporate law question currently unaddressed in Delaware law is whether the fiduciary duties of corporate officers, as agents, are the same as, or different from, the fiduciary duties of corporate directors. A related question is whether, in reviewing officer conduct, courts will apply the business judgment rule in the same broad (and protective) manner in which it is applied to assessing director behavior.

The professional responsibility issue concerns whether, and how well, lawyers are advising …

Having The Fiduciary Duty Talk: Model Advice For Corporate Officers (And Other Senior Agents), Lyman P.Q. Johnson

Scholarly Articles

Countless legal materials address the fiduciary duties of corporate directors. These include extensive decisional law, numerous institutes and continuing legal education seminars, several treatises and casebooks, and the well-known Corporate Director's Guidebook, recently released in its fifth edition. By contrast, legal materials on the fiduciary duties of corporate officers - key actors and agents in any company - are quite sparse. Case law is meager and undeveloped, with even such a baseline issue as the applicability of the business judgment rule lacking resolution. Treatises, institutes, and other legal materials frequently lump officer fiduciary duties with those of directors or treat …

Comment On Brian R. Cheffins, Dividends As A Substitute For Corporate Law: The Separation Of Ownership And Control In The United Kingdom, Lynne L. Dallas

Washington and Lee Law Review

No abstract provided.

Dividends As A Substitute For Corporate Law: The Separation Of Ownership And Control In The United Kingdom, Brian R. Cheffins

Washington and Lee Law Review

No abstract provided.

The Seductive Comparison Of Shareholder And Civic Democracy, Usha Rodrigues

Washington and Lee Law Review

No abstract provided.

Shareholder Democracy And The Economic Purpose Of The Corporation, Donald J. Smythe

Washington and Lee Law Review

No abstract provided.

Personification In Three Legal Cultures: The Case Of The Conception Of The Corporate Unit, Gregory A. Mark

Washington and Lee Law Review

No abstract provided.

The Transplantation Of The Legal Discourse On Corporate Personality Theories: From German Codification To British Political Pluralism And American Big Business, Ron Harris

Washington and Lee Law Review

No abstract provided.

The Relevance Of Corporate Theory To Corporate And Economic Development: Comment On The Transplantation Of The Legal Discourse On Corporate Personality Theories, Lawrence E. Mitchell

Washington and Lee Law Review

No abstract provided.

Comment: Corporate Governance And The "D-Word", Thomas W. Joo

Washington and Lee Law Review

No abstract provided.

Shareholders As Proxies: The Contours Of Shareholder Democracy, Dalia Tsuk Mitchell

Washington and Lee Law Review

No abstract provided.

The Separation Of Ownership And Control In Modem Corporations: Shareholder Democracy Or Shareholder Republic? A Commentary On Dalia Tsuk Mitchell's Shareholders As Proxies. The Contours Of Shareholder Democracy, Lucas E. Morel

Washington and Lee Law Review

No abstract provided.

Social Conceptions Of The Corporation: Insights From The History Of Shareholder Voting Rights, Colleen A. Dunlavy

Washington and Lee Law Review

The diversity of voting rules in today's corporations indicates that power is distributed among shareholders in a great variety of ways, but current theories of the corporation have little to say about this diversity. For insight into the significance of different ways of distributing power among shareholders and the social conceptions of the corporation that they imply, this Article develops a historically-groundedframeworfko r evaluating the political import of shareholder voting rights. Sketching out the history of shareholder voting rights since the early nineteenth century, it shows how the distinctive meaning of the twentieth-century term "shareholder democracy" grew out of the …

Take It Slow: A Novel Concept In The Life Of Sarbanes-Oxley, D. Skylar Rosenbloom

Washington and Lee Law Review

No abstract provided.

Faith And Faithfulness In Corporate Theory, Lyman P.Q. Johnson

Scholarly Articles

No abstract provided.

The Audit Committee's Ethical And Legal Responsibilities: The State Law Perspective, Lyman P.Q. Johnson

Scholarly Articles

This paper provides a state law perspective on the post-scandal, post-reform audit committee. Federal law, along with NYSE and Nasdaq (together, "SRO") rules, recently have made sweeping changes in corporate governance, including numerous provisions that bear on audit committees. These changes are unprecedented and dramatic, and rightly have received wide attention and careful study. Certain basic principles underlying the governance functions and duties of audit committees, however, originate in, and are still determined by, state law. Moreover, state law applies to all corporations; federal law and SRO rules on audit committees apply only to those companies coming under federal law …

Corporate Officers And The Business Judgment Rule, Lyman P.Q. Johnson

Scholarly Articles

This article argues that the business judgment rule - a cornerstone concept in corporate law - does not and should not extend to corporate officers in the same broad manner in which it is applied to directors. The argument proceeds along both descriptive and normative lines. After first reviewing judicial decisions, the article concludes that, notwithstanding frequent, broad assertions to the contrary, application of the rule to corporate officers is not firmly established in case law. The article next examines the policy case by assessing three conventional rationales for applying the rule to directors and concluding, on balance, that the …

Recalling Why Corporate Officers Are Fiduciaries, Lyman P.Q. Johnson, David K. Millon

Scholarly Articles

For all the recent federal attention to regulating - and differentiating - corporate officer and director functions, a curious fact remains: state fiduciary duty law makes no distinction between the fiduciary duties of these two groups. Instead, courts and commentators routinely describe the duties of directors and officers together, and in identical terms. To lump officers and directors together as generic fiduciaries with no distinction being made between them, suggests - as patently is not the case - that their institutional function and legal roles within the corporation are the same. Such a view, consequently, undermines efforts more sharply to …

"We Are An Equal Opportunity Employer": Diversity Doublespeak, Cheryl L. Wade

Washington and Lee Law Review

There are too few discussions about race and race relations among corporate managers and directors. The rhetoric used in these infrequent discussions revolves around the idea of diversity in the workplace. In recent years, when speaking about employees and race issues, corporate actors have become curiously silent about discrimination and racism. This Article provides several examples of the rhetorical devices used by corporate spokespersons that ignore persisting problems with discrimination and racism by focusing solely on diversity efforts. Diversity rhetoric allows corporate managers to avoid responsibility for enduring discrimination in the workplace. Diversity efforts, without antidiscrimination efforts, increase the likelihood …

Games Ceos Play And Interest Convergence Theory: Why Diversity Lags In America's Boardrooms And What To Do About It, Steven A. Ramirez

Washington and Lee Law Review

No abstract provided.

Overcoming Resistance To Diversity In The Executive Suite: Grease, Grit, And The Corporate Promotion Tournament, Donald C. Langevoort

Washington and Lee Law Review

No abstract provided.

Race To The Top Of The Corporate Ladder: What Minorities Do When They Get There, Devon W. Carbado, Mitu Gulati

Washington and Lee Law Review

Racing to the top of the corporate hierarchy is difficult, no matter how qualified or capable the candidate. Producing more widgets than one's competitors is not enough. Negotiating the political landscape of the institution is also required. More specifically, individual corporate officers have to be appeased, powerful interest groups have to be co-opted and made allies, and competitors have to be undermined or eliminated. The more bureaucratic the organization and the more opaque the promotion process, the more important this institutional game to climbing the corporate ladder. This Article identifies the kind of racial minorities or racial types who are …