Showing archive for: “Corporate Governance”
Creditor derivative suits in Delaware LLCs
The ever-helpful Francis Pileggi thoroughly discusses an interesting and important recent Delaware opinion by VC Laster, CML V, LLC v. Bax, C.A. No. 5373-VCL (Del.Ch. Nov. 3, 2010) which holds a creditor lacks standing under the Delaware LLC act to sue an insolvent LLC derivatively. The following builds on Mr. Pileggi’s excellent analysis. The court interpreted ... Creditor derivative suits in Delaware LLCs
Business Law and the Austrian Theory of the Firm
My Missouri colleague, Peter Klein, of Organizations and Markets fame (and, like Larry, a proud non-voter), has been asked to contribute a book chapter on the Austrian theory of the firm and the law. Peter, who has written extensively on the Austrian theory of the firm and maintains an online bibliography on the subject, is ... Business Law and the Austrian Theory of the Firm
Stanford Law School Panel: The Constitution in the Financial Crisis
I am privileged to have the opportunity to travel to Palo Alto next week alongside my senior colleague Prof. Todd Zywicki to participate in a conference on The Constitution in the Financial Crisis organized by the Stanford Constitutional Law Center. I will in large part be discussing my work in this area, including Treasury Inc.: ... Stanford Law School Panel: The Constitution in the Financial Crisis
A new argument against federal proxy access
Dodd-Frank included new federal rules regarding proxy access, which have significant problems. Now a new paper by Becker, Bergstresser and Subramanian provides an additional argument against these rules, Does Shareholder Proxy Access Improve Firm Value? Evidence from the Business Roundtable Challenge. Here’s the abstract: We measure the value of shareholder proxy access by using a ... A new argument against federal proxy access
Indoors and outdoors whistleblowing
Today’s WSJ notes criticism of Dodd-Frank’s bounty provision for whistleblowers on the ground that it undermines the internal reporting provisions of the previous financial law, Sarbanes-Oxley. The WSJ notes that plaintiffs lawyers eager to handle complaints on behalf of whistleblowers are getting the word out, issuing press releases and publishing articles about the new law ... Indoors and outdoors whistleblowing
The limits of fiduciary duties: tomorrow at B.U.
Tomorrow at Boston University I’ll be joining a distinguished group to discuss the Role of Fiduciary Law and Trust in the 21st Century, inspired by the work of Professor Tamar Frankel. Those who have followed my work will not be surprised that I’m going to focus on the limits of fiduciary duties, and their inappropriate ... The limits of fiduciary duties: tomorrow at B.U.
Proxy advisors as regulatory spawn
John Carney comments on the rise of proxy advisory firms. He attributes this partly to increasing complexity caused by the securities industry. He notes the irony that “[r]eforms to securities regulations that were ostensibly intended to empower shareholders or further ‘shareholder democracy’ have instead resulted in increasing domination of proxy questions by a small clique ... Proxy advisors as regulatory spawn
Citizens United and the shareholder protection gambit
Last January in Citizens United the Supreme Court delivered a blow to the opponents of corporate speech by enabling corporations to spend directly on political campaigns rather than relying on PACs and lobbying. A majority of the Court concluded that public debate could be best promoted by protecting all speech, regardless of speaker. A sizable ... Citizens United and the shareholder protection gambit
Put-backs: How much are the banks worth?
BoA is trading around $11. Its book value is $21.45. The difference has a lot to do with whether investors in mortgage-backed securities will be able to get BoA (and other banks) to repurchase hundreds of billions of dollars of mortgage-backed securities because the bonds didn’t meet representations and warranties in the bond contracts. Here’s ... Put-backs: How much are the banks worth?
Agents Prosecuting Agents, at Overcriminalization 2.0.
Tomorrow in D.C. I’m joining a distinguished group for a program called “Overcriminalization 2.0” (agenda) presented by GMU’s Journal of Law, Economics & Policy and Law & Economics Center, the National Association of Criminal Defense Lawyers, and the Foundation for Criminal Justice. According to the program, “[t]his symposium will capture the broad consensus on the ... Agents Prosecuting Agents, at Overcriminalization 2.0.
Say on Pay
A late Monday press release from the Securities and Exchange Commission announces a rule proposal to implement the say on pay requirements of the Dodd-Frank Act. I testified before both houses of Congress against the legislative authorizing language in Dodd-Frank that the SEC uses to promulgate the rule. My testimony before the House Financial Services ... Say on Pay
Another unintended consequence of SOX: preliminary earnings
We know that Sarbanes-Oxley imposed significant costs on firms in the interests of more accurate disclosures. Maybe this is a cost worth bearing. But what if one of these costs is actually less accurate disclosures? Scott N. Bronson, Chris Hogan and Marilyn Johnson of Michigan State have written The Unintended Consequences of PCAOB Auditing Standards ... Another unintended consequence of SOX: preliminary earnings
