Business Organizations Law Commons^™

Corporate And Business Law, Laurence V. Parker Jr.

University of Richmond Law Review

No abstract provided.

Revising Federal Securityholder Communication Rules To Respond To Pension Funds' Increasing Market Presence, Kenneth R. Lehman

Pepperdine Law Review

No abstract provided.

Interpreting Nonshareholder Constituency Statutes, Stephen M. Bainbridge

Pepperdine Law Review

No abstract provided.

Regulatory Conflicts: International Tender And Exchange Offers In The 1990s, John C. Maguire

Pepperdine Law Review

No abstract provided.

Corporate Governance: Some Unasked Questions A Personal Commentary, Henry Lesser

Pepperdine Law Review

No abstract provided.

Striking The Wrong Balance: Constituency Statutes And Corporate Governance , Edward D. Rogers

Pepperdine Law Review

No abstract provided.

How Long Can This Go On? The Controversy Over The Application Of The Statute Of Limitations To S Corporations And Their Shareholders, J. Marcus Sommers

Pepperdine Law Review

No abstract provided.

Post-Citizens United: Using Shareholder Derivative Claims Of Corporate Waste To Challenge Corporate Independent Political Expenditures, William Alan Nelson Ii, Esq.

Nevada Law Journal

No abstract provided.

Investors Beware: Assessing Shareholder Derivative Litigation In India And China, Ann M. Scarlett

All Faculty Scholarship

In response to the 2008 financial crisis, the United States government bailed out many business entities in exchange for equity and debt interests in such entities. It also dramatically increased the regulations imposed on businesses. This level of government ownership and intervention in corporations is rare in free-market capitalist systems such as the United States. Government ownership and control, however, are common among historically socialist countries such as India or communist countries such as China. Yet, the United States’ recent actions stand in stark contrast to the trend in India and China, which have both been moving toward more capitalist …

Shotgun Weddings: Director And Officer Fiduciary Duties In Government-Controlled And Partially-Nationalized Corporations, David M. Barnes

Vanderbilt Law Review

Corporate law considers the affairs of a corporation to be private activity. The prevailing concept of the firm is a nexus of private contract rights among participants in an economic enterprise. But for many U.S. auto and financial services corporations, the events of the fall of 2008 and the winter of 2009 turned this presumption on its head. The U.S. government's $700 billion bailout injected an alien actor-the United States Treasury-into this once-private enterprise. The bailout enabled the Treasury to take a direct equity stake in many of the nation's struggling auto and financial services corporations. In the fall of …

Corporate And Business Law, Laurence V. Parker

University of Richmond Law Review

No abstract provided.

Evaluating The Mission: A Critical Review Of The History And Evolution Of The Sec Enforcement Program, Paul S. Atkins, Bradley J. Bondi

Fordham Journal of Corporate & Financial Law

No abstract provided.

The False Promise Of One Share, One Vote, Grant M. Hayden, Matthew T. Bodie

All Faculty Scholarship

Shareholder democracy has blossomed. The once moribund shareholder franchise is now critical in takeover contests, merger decisions, and board oversight. However, the mechanisms of this vote remain largely under theorized. In this Article, we use voting rights and social choice theory to develop a new approach to the corporate franchise. Political democracies typically tie the right to vote to the level of a person's interest in the outcome of the election. Corporate democracies, on the other hand, tend to define the requisite institutional interest quite narrowly, and thus restrict the right to vote to shareholders alone. This restriction has found …

One Share, One Vote And The False Promise Of Shareholder Homogeneity, Grant M. Hayden, Matthew T. Bodie

Faculty Journal Articles and Book Chapters

Shareholder democracy has blossomed. The once moribund shareholder franchise is now critical in takeover contests, merger decisions, and board oversight. However, the mechanisms of this vote remain largely undertheorized. In this Article, we use voting rights and social choice theory to develop a new approach to the corporate franchise. Political democracies typically tie the right to vote to the level of a person's interest in the outcome of the election. Corporate democracies, on the other hand, tend to define the requisite institutional interest quite narrowly, and thus restrict the right to vote to shareholders alone. This restriction has found its …

The Dialectical Regulation Of Rule 14a-8: Intersystemic Governance In Corporate Law, Robert B. Ahdieh

Faculty Scholarship

In recent years, Rule 14a-8 of the Securities Exchange Act - first adopted more than sixty years ago to increase shareholder participation in corporate governance - has been the subject of a flurry of litigation, scholarly analysis, and SEC rulemaking. Most recently, following several years of debate, the SEC issued a significant clarification of the rule, reversing the Second Circuit's hotly contested interpretation of it in AFSCME v. AIG. For the most part, the debates surrounding Rule 14a-8 - including in the latter case - have focused on the scope of the rule's exceptions. This paper, selected for reprinting in …

Managers’ Fiduciary Duties In Financially Distressed Corporations: Chaos In Delaware (And Elsewhere), Rutheford B. Campbell Jr., Christopher W. Frost

Law Faculty Scholarly Articles

The inherent conflict between creditors and shareholders has long occupied courts and commentators interested in corporate governance. Creditors holding fixed claims to the corporation's assets generally prefer corporate decision making that minimizes the risk of firm failure. Shareholders, in contrast, have a greater appetite for risk, because, as residual owners, they reap the rewards of firm success while sharing the risk of loss with creditors.

Traditionally, this conflict is mediated by a governance structure that imposes a fiduciary duty on the corporation's managers-its officers and directors-to maximize the value of the shareholders' interests in the firm. In this traditional view, …

Curbing Shareholder Voting Groups With A New Philosophy For Washington's Business Corporation Act, Tilman Larson

Seattle University Law Review

This Comment explores Washington's changing philosophy of shareholder voting and how the current developments to Washington's corporate law have impacted shareholder voting group rights. In light of Washington's corporate law history, the underlying reasons for the amendments, and case law, this Comment argues that the recent amendments have altered, rather than preserved, what has been historically the true philosophy underlying Washington corporate law: minority shareholder rights. Part II of this Comment tracks the evolution of voting group rights through past Washington law and until the present Washington Business Corporation Act. Part III discusses the underlying reasons for the amendments, addresses …

Leo Strine's Third Way: Responding To Agency Capitalism, Ronald J. Gilson

Faculty Scholarship

Ten years ago, Tony Blair's "New Labour" government sought an agenda that replaced ideology with a pragmatic focus on both the creation of wealth and its distribution. Not surprisingly, part of this effort involved proposals to bridge the gap between capital and labor through refraining corporate governance. A "third way" as it was then styled, would walk a fine line between privileging markets and allocational efficiency at the cost of social justice on the one hand, and accepting less for everyone as long as the distribution was fair on the other. Motivated by changes in how we save for retirement …

Reconciling Shareholder Limited Liability With Vicarious Copyright Liability: Holding Parent Corporations Liable For The Copyright Infringement Of Subsidiaries, Joshua M. Siegel

University of Richmond Law Review

No abstract provided.

Constraining Dominant Shareholders' Self-Dealing: The Legal Framework In France, Germany, And Italy , Pierre-Henri Conac, Luca Enriques, Martin Gelter

Faculty Scholarship

All jurisdictions supply corporations with legal tools to prevent or punish asset diversion by those, whether managers or dominant shareholders, who are in control. As previous research has shown, these rules, doctrines and remedies are far from uniform across jurisdictions, possibly leading to significant differences in the degree of investor protection they provide. Comparative research in this field is wrought with difficulty. It is tempting to compare corporate laws by taking one benchmark jurisdiction, typically the US, and to assess the quality of other corporate law systems depending on how much they replicate some prominent features. We take a different …

Executive Certification Requirements In The Sarbanes-Oxley Act Of 2002: A Case For Criminalizing Executive Recklessness, Christopher Wyant

Seattle University Law Review

This Comment focuses on sections 302 and 906 of the Sarbanes-Oxley Act. Section 302 requires Chief Executive Officers (CEOs) and Chief Financial Officers (CFOs), or their equivalents, to personally certify the accuracy of financial disclosure filings required by the SEC and to vouch for the reliability of the internal corporate controls that produce that information.'4 Section 906 contains an additional certification requirement and provides specific criminal penalties for willful or knowing violations of that requirement.'" An efficiency-based analysis of these two sections of the Sarbanes-Oxley Act suggests that including a recklessness standard of intent would be more likely to increase …

Bag Wars And Bank Wars, The Gucci And Banque National De Paris Hostile Bids: European Culture Responds To Active Shareholders, Ernesto Hernández-López

Fordham Journal of Corporate & Financial Law

No abstract provided.

To Know A Veil, Douglas C. Michael

Law Faculty Scholarly Articles

Lawyers, judges, law students, and law professors have a love-hate relationship with the doctrine of “piercing the corporate veil”—the idea that shareholders might sometimes be personally liable for the debts of the corporation. It is the subject covered more than all others in courses on corporation law. It is widely litigated, being the subject of thousands of opinions. Yet, for all this attention, it is routinely vilified by the experts. Most commentators recognize that it is jurisprudence without substance.

This Article is an attempt to form a basis for rigorous analysis of virtually every veil-piercing case and to rid the …

Shareholder Oppression In Close Corporations: The Unanswered Question Of Perspective, Douglas K. Moll

Vanderbilt Law Review

The doctrine of shareholder oppression protects the close corporation minority stockholder from the improper exercise of majority control.! Nevertheless, when a close corporation minority shareholder asserts that the majority shareholder has acted "oppressively" towards him, the minority's chance of success may very well depend on the perspective from which shareholder oppression is viewed. Consider the following two decisions:

In Priebe v. O'Malley, the controlling shareholders of a close corporation terminated the employment of Myron Priebe, a minority shareholder, for "unsatisfactory" work performance.! Priebe sued, asserting that the termination amounted to oppressive conduct! The trial court noted that "Priebe was not …

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 …

Corporations - Amendment Of Articles Of Incorporation - Power Of Majority To Require Holders Of Redeemable Preferred Stock To Accept Bonds Instead Of Money In Redemption, Clayton R. Smalley

Michigan Law Review

Plaintiffs owned 6 percent cumulative convertible prior preferred stock in defendant corporation. The stock had a stated value of $100 per share, and was redeemable at the option of the corporation at $115 per share plus accumulated dividends. By vote of more than two-thirds of the outstanding shares of each class of stock issued, defendant's articles of incorporation were amended to authorize its board of directors to redeem the prior stock at $120 per share, payable in the company's 5 percent 30-year debentures. Interest on the debentures was to be cumulative, paid out of earnings, and subordinated to the other …

Federal Taxation - Tax Aspects Of Corporate Buy And Sell Agreement, Joel D. Tauber S.Ed.

Michigan Law Review

It is the purpose of this comment to consider the tax problems connected with both types of "conventional" corporate buy and sell agreements. It should be recognized, however, that there are many questions of local law and business necessity that also exert influence on the use of such agreements.

Corporations - Charter - Change Of Voting Right By Amendment, Dale W. Van Winkle S.Ed.

Michigan Law Review

Defendant, incorporated in 1938 with an authorized capital stock of 500 shares, amended its articles of incorporation in 1940 to increase the common stock to 2,000 shares, and to authorize the issue of preferred stock. By the amendment, the voting power was vested exclusively in the common stock, with the exception that the holders of preferred stock would acquire temporary voting power upon default of four semi-annual dividends. Default in payment of dividends occurred and the preferred stockholders exercised the right to vote from 1943 on. In 1953, a second amendment was proposed and passed by a majority in interest …

Corporations - Sale Of Assets As A Means Of Avoiding State Constitutional Limitation On Corporate Life, Judson M. Werbelow

Michigan Law Review

Defendant, a Michigan corporation, was incorporated in 1923 for a term of thirty years, the maximum term permitted by the Michigan constitution. Shortly before this thirty-year term was to expire, majority and minority stockholders engaged in unsuccessful negotiations, each group attempting to purchase the other's interest in the corporation. A special stockholders' meeting was then called to consider a proposed renewal of the corporate term. This proposal failed to gamer the vote of two-thirds of the outstanding shares which was required for approval. The attorneys representing the majority shareholders proceeded to organize a dummy corporation, which in tum offered the …