Business Organizations Law Commons^™

What's Your Water Worth? Why We Need Federal Fine Guidelines For Corporate Environmental Crime , Mark H. Allenbaugh

American University Law Review

No abstract provided.

Corporate Officer And Director Liability: Atherton V. Federal Deposit Insurance Corporation: A Final Resolution Of The Issues Surrounding Section 1821(K) Of Firrea, Tiffany Z. Stuart

Oklahoma Law Review

No abstract provided.

For-Profit Corporations That Perform Public Functions: Politics, Profit, And Poverty, Cheryl L. Wade

Faculty Publications

In this Article, Professor Wade argues that the corporate law shareholder-primacy paradigm fails to adequately account for individuals who depend upon for-profit corporations for the educational, medical, correctional, and social services traditionally provided by government. These for-profit corporations, termed "Public Function Companies" by Professor Wade, have two distinct constituencies: shareholders who expect wealth maximization to guide corporate action and "Corporate Dependents" who rely upon the essential services administered by these corporations. Because corporate law generally requires officers and directors to act only in the interest of shareholders, Corporate Dependents may be left with inadequate services and no mechanism to influence …

Theories Of The Corporation And The Limited Liability Company: How Should Courts And Legislatures Articulate Rules For Piercing The Veil, Fiduciary Responsibility And Securities Regulation For The Limited Liability Company, David L. Cohen

Oklahoma Law Review

No abstract provided.

Asset Securitization And Corporate Risk Allocation, Christopher W. Frost

Law Faculty Scholarly Articles

Asset securitization is a financial innovation in which corporations sell financial assets to a specially formed entity that in turn taps financial markets for the purchase price. The device provides firms an alternative to raising capital through traditional debt and equity markets. Practitioners of the approach tout securitization as a means through which a firm can lower its overall cost of capital by limiting the risk facing investors in the securitized assets. Commentators have described asset securitization as "one of the most important financing vehicles in the United States." Interest in the device is increasing dramatically as more companies see …

A New Direction For State Corporate Codes, Mark J. Loewenstein

Publications

No abstract provided.

Corporate Fiduciary Principles For The Post-Contractarian Era, Rutheford B. Campbell Jr.

Law Faculty Scholarly Articles

The impact of the law and economics movement on legal scholarship, legal analysis, and, ultimately, on the rules under which our society operates is substantial. The proponents of this movement ("Contractarians") articulate their positions skillfully and apply their principles broadly across the entire spectrum of our laws, including, of course, the area of corporate law.

The purpose of this Article is to propose, explain, and defend broad and unifying principles to guide the development of fiduciary duties of corporate managers in the post-Contractarian period. These principles are based on Pareto criteria, which are demonstrably appealing to society and provide workable …

Corporate Pro-Choice: New York Assumes An Anti-Takover Position, Paula Walter

Touro Law Review

No abstract provided.

Renegotiating Transnational Investment Agreements: Lessons For Develping Countries From The Ghana-Valco Experience, Paul Kuruk

Michigan Journal of International Law

This article describes the use of the renegotiation process to resolve problems that arise in the relations between participants in transnational investment. It draws conclusions from the successful renegotiation of an agreement executed in 1962 under which the Ghanaian government guaranteed bauxite and hydroelectric power supplies to support the smelting operations of the Volta Aluminium Company, Limited (Valco) in return for revenues from taxes and from payments for electricity, water, and use of the country's port facilities. The agreement between Ghana and Valco was entered into as part of the Volta River Project (VRP). This project was an investment scheme …

Piercing The Corporate Veil—The Undercapitalization Factor, Harvey Gelb

Chicago-Kent Law Review

No abstract provided.

Intracorporate Plurality In Criminal Conspiracy Law, Sarah N. Welling

Law Faculty Scholarly Articles

The concept of conspiracy currently plays a significant role in three areas of substantive law: antitrust, civil rights, and criminal law. Although the role of conspiracy in these substantive areas of law differs in many ways, all three require that the conspiracy consist of a plurality of actors. Determining what constitutes a plurality of actors when all the alleged conspirators are agents of a single corporation poses a continuing problem.

This problem raises two distinct questions. The first is whether, when one agent acts alone within the scope of corporate business, the agent and the corporation constitute a plurality. The …

Definition Of Control In Secondary Distributions, Rutheford B. Campbell Jr.

Law Faculty Scholarly Articles

Section 2(11) of the Securities Act of 1933 (Act) generally subjects the sale of securities by a person "controlling an issuer" to the same rules that govern the sale of securities by an issuer. Accordingly, before a "control" person may sell the securities he holds in the controlled corporation he must either register them with the Securities and Exchange Commission (Commission) or qualify for an exemption from the registration requirement. While the Act clearly requires that a "control" person either register or qualify for an exemption, it fails to define "control." Thus, the task of defining has fallen to the …

Derivative Suits: Director Demand Under Rule 23.1 And Section 36(B) Of The Investment Company Act, Archie E. Williams, Jr.

Fordham Urban Law Journal

In 1882, the Supreme Court first established the conditions precedent to an ordinary derivative action by the shareholders of a corporation. Now after over nine decades of common law development, the present conditions are embodied in Rule 23.1 of the Federal Rules of Civil Procedure. Of relatively recent interest, however, is the relationship between that Rule and section 36(b) of the Investment Act of 1940 (Act), which authorizes a derivative action by the shareholders of a registered investment company. This Note will focus on one aspect of that relationship--the requirement that a plaintiff make a demand upon the corporation's directors …

Limited Liability For Corporate Shareholders: Myth Or Matter-Of-Fact, Rutheford B. Campbell Jr.

Law Faculty Scholarly Articles

One of the most important and firmly entrenched concepts of modern corporate law is the concept of limited liability. The digests abound with ringing phrases granting the owners of corporations immunity from liability beyond their initial investment. There are, however, numerous cases in which the courts have denied the owners of corporations the protection of limited liability and have held the owners liable for an obligation incurred by the corporation. It is the purpose of this paper to examine the theories under which the owners of corporations have been held liable for the contractual obligation of corporations.

Frey, Morris, Jr. & Choper: Cases And Materials On Corporations, Stanley Siegel

Michigan Law Review

A Review of Cases and Materials on Corporations By Alexander H. Frey, C. Robert Morris, Jr., and Jesse H. Choper

May A Corporation Act As Its Own Attorney, Timothy G. Cotner

Cleveland State Law Review

The question involved here is the right of a "person," not an attorney, to bring action or defend in a court of law. If a natural person may represent himself, why cannot a corporation choose to represent itself in court without the aid of an attorney? The question is posed with the thought in mind that in the eyes of the law a corporation is a legal entity and, therefore, should be permitted to appear in state and federal courts solely through the representation of an agent. This kind of a court appearance, whether by a natural person or by …

Actions By A Sole Stockholder Of A Corporation, Julius E. Kovacs

Cleveland State Law Review

The law regarding sole shareholders' actions appears to be very clear. In most cases the corporate wrong can only be redressed by the corporation itself and in the corporate name. The few exceptions appear to have been allowed in good conscience by courts of equity, with each case being decided on its own merits. While other areas of the law are constantly changing, the law with respect to sole shareholders' actions has remained stable, with no indications that any changes will take place in the immediate future.

Corporations- Allocation Of Subsidiary's Tax Benefit From Consolidated Return, Thomas B. Ridgley

Michigan Law Review

Defendant parent corporation received from its subsidiary 3,556,992 dollars in tax benefits which had accrued to the subsidiary from filing a consolidated income tax return. By agreement between parent and subsidiary, the profit-making corporation was to pay the losing corporation the savings created by the consolidated return. The working relationship of the two assured the subsidiary profits and the parent losses. Consequently, nearly all tax benefit inevitably flowed to the parent. Plaintiffs, the subsidiary's minority stockholders, sought a refunding of benefits allocated to defendant, claiming that the agreement was unfair and alleging that the defendant, as the subsidiary's majority shareholder, …

Changing A Partnership Into A Corporation, Daniel J. Gifford

Vanderbilt Law Review

The present essay will deal only with those businesses which possess unlimited growth potential in respect of the amount of assets which they can profitably employ in the production of income. If such businesses grow sufficiently, they will probably ultimately reach the stage of publicly held corporations. The reasons for this will vary, although it would seem that once the growth process has picked up momentum, the business may require capital at a rate faster than earnings can be accumulated or funds can be obtained from lenders.

Notes: Director’S Statutory Action In New York, Sidney Kwestel

Scholarly Works

No abstract provided.

Forming A Subsidiary In The European Common Market, Alfred F. Conard

Michigan Law Review

The appearance of a new market which is open to free enterprise and contains almost as many customers as the United States has opened immense opportunities to American enterprises, with their unique experience in mass production and mass marketing. General counsel for large American enterprises are confronted with a new need for some understanding of the problems of organizing subsidiary companies in this new market. The present article is written to supply an introduction to the legal factors which bear on solutions of these problems.

Revival Of Corporation Terminates Agent's Liability On Post Forfeiture Contract - Marsh Furniture Company V. Solomon, Stephen M. Ehudin

Maryland Law Review

No abstract provided.

Corporations - Stock Transfer - Enforceability Of Restrictions On Right Of Transfer When Not Stated On Certificate, L. Ronald Modlin

Michigan Law Review

A by-Iaw of defendant corporation provided that no stockholder could sell his shares unless he first offered them for sale to the corporation or its directors. The by-law also stated that this restriction should be printed on the stock certificates and would thereupon bind all present or future owners or holders. The corporation never complied with this latter provision. Plaintiff, having knowledge of the by-law restriction, purchased two shares of the corporation's stock, but these shares were not first offered for sale to the corporation or its directors. When the corporation refused to transfer the shares, plaintiff sued to compel …

Corporations - Officers And Directors - Indemnification Of Expenses Incurred In Defense Of Contract Of Employment, John P. Williams

Michigan Law Review

Plaintiff, Sorenson, contracted with defendant, Overland Corporation, to become one of its directors, and the contract was approved by Overland's stockholders. After he began to serve as a director, Sorenson was made a party defendant to a stockholder's derivative suit attacking the propriety of his contract of employment with Overland. The derivative suit terminated in favor of Sorenson and he then brought an action for reimbursement of the counsel fees incurred by him in defending the stockholder's action. Plaintiff's action was under a corporate by-law providing that the corporation shall indemnify directors and officers against expenses incurred by them in …

Corporations - Liabilites - Inadequate Capitalization As Ground For Disregarding Corporate Entity, Lewis L. Clum

Michigan Law Review

Defendant Resnick, meeting minimum statutory incorporation requirements, organized a corporation and thereafter persuaded defendants Cowan to join him in operating a used car enterprise under the corporate name. No stock was issued, nor capital paid in, although a checking account was opened for use by the business. Car purchases were financed through loans made or guaranteed by the elder Cowan, who held title until resale. Proceeds from resale transactions were deposited in the checking account, from which defendant Resnick reimbursed Cowan for money advanced. Sales volume averaged from $100,000 to $150,000 monthly. Assured that the elder Cowan was "backing" the …

Corporations - Capital And Stock - Applicability Of Restrictions On Transfer Of Stock To Transfer Caused By Death, Robert P. Luciano

Michigan Law Review

The stock of the Taylor Trunk Company, with the exception of the two shares now in controversy, was divided equally between two brothers, the remaining two shares having been held by a third brother now deceased. A by-law provided: "That no transfer or sale of the stock of the Company can be made without first offering said stock for sale to the remaining stockholders. . . ." The administrator with will annexed and the legatee of the decedent sought in this action to have the two shares of stock owned by decedent at his death transferred on the books of …

Corporations - Promotion - Discharge Of Promoter's Liability As Bidder At A Bankruptcy Sale, John Morrow

Michigan Law Review

On October 1, defendant made the high bid at a bankruptcy sale of hotel properties as "Mr. Ash, trustee." Later that same day a certificate of incorporation was executed for a corporation with Ash as treasurer. On October 4 the proper corporate papers were filed with the secretary of state. On October 4 the receivers receipted for the earnest money deposit, the instrument acknowledging, as interpreted by the court, that the receivers would look to the corporation to complete the contract and would not look to Mr. Ash personally. On October 14, the referee confirmed the sale to "Mr. Ash, …

Business Associations - Uniform Limited Partnership Act - Corporation As A Limited Partner, Richard Singer

Michigan Law Review

The Port Arthur Trust Co., a Texas corporation, sought to enter into a limited partnership agreement as a limited partner. Its capital contribution was to be three trusts established by the prospective general partner wherein the trust company had been named trustee. The secretary of state refused to file the instrument creating the limited partnership on the grounds "that it was necessary for a corporation to have express charter powers" before it can, enter into a limited partnership, and that "a corporation is not a 'person' " within the meaning of the Texas Uniform Limited Partnership Act. The corporation then …

Corporations - Stockholders - Availability Of Federal Remedy As Basis For Denial Of Attorney Fees In Derivative Action, Jerome Prewoznik

Michigan Law Review

Defendants were directors of Merritt, Chapman and Scott Corporation and of Montgomery Ward & Co., Inc. simultaneously. Plaintiff, a stockholder in Merritt, instituted a derivative suit to compel the resignation of defendants from their positions with Ward on the ground that an interlocking directorate existed making Merritt subject to criminal and civil prosecution under federal law. Defendants resigned before judgment. Plaintiff, arguing that its suit was the cause of the resignations and that Merritt was thereby benefited, moved for an award of counsel fees to be assessed against Merritt. Held, application for counsel fee denied. Plaintiff could have achieved …

Corporations - Officers And Directors - Agreement Interfering With Management By Board Of Directors, Edward H. Hoenicke S.Ed.

Michigan Law Review

Plaintiffs, minority stockholders in a closely held corporation, asked that the court declare invalid an agreement between the majority stockholders and their "agent-directors" for the management of the business. The agreement provided that for ten years the stock of the parties to the agreement would be voted as a unit as any seven of the agents should direct or, if they could not agree, as directed by an arbitrator chosen by them. The agents were to be elected to the board of directors by the stockholders who appointed them. Under a cumulative voting provision, the parties to the agreement had …