Wednesday, April 23, 2014

Racial Identities of Corporations

In March, the Fourth Circuit held in Carnell Construction Corp. v. Danville Redevelopment & Housing Authority, that racial identity can be imputed to a corporation for purposes of standing under Title VI, citing to case precedent from the several circuits allowing 1981 claims to be raised by corporations. 

“[W]e observe that several other federal appellate courts have considered this question, and have declined to bar on prudential grounds race discrimination claims brought by minority-owned corporations that meet constitutional standing requirements.” 

The Fourth Circuit had to deal with the following language in Arlington Heights, 429 U.S. 252, 263 (1977): “As a corporation, MHDC has no racial identity and cannot be the direct target of the petitioners' alleged discrimination. In the ordinary case, a party is denied standing to assert the rights of third persons.” In Arlington Heights, the Supreme Court however did not need to “decide whether the circumstances of this case would justify departure from that prudential limitation and permit MHDC to assert the constitutional rights of its prospective minority tenants. For we have at least one individual plaintiff who has demonstrated standing to assert these rights as his own.” (citations omitted).  The dicta in Arlington Heights was not a barrier to imputing a racial identity to the corporation in the Fourth Circuit case.

In a clear statement, the Fourth Circuit concluded that:

“We agree with the Ninth Circuit that a minority-owned corporation may establish an “imputed racial identity” for purposes of demonstrating standing to bring a claim of race discrimination under federal law. We hold that a corporation that is minority-owned and has been properly certified as such under applicable law can be the direct object of discriminatory action and establish standing to bring an action based on such discrimination.”

Chief Justice Roberts was concerned about the connection of racial identities for corporations and corporate free exercise of religion as raised in the Hobby Lobby and related cases.   Note that fellow BLPB blogger Josh Fershee wrote about the racial identity of a corporation on BLPB here arguing why religious discrimination claims by corporations should be allowed and how the analysis would work.  Professor Bainbridge weighed in on the issue as well.

Here is my best response as to why holding that corporations can have a racial identity is not necessarily fatal to the claim that corporations cannot have a religious identity for purposes of free exercise under the 1st Amendment, and why religious discrimination cases for corporations may also be more difficult than racial discrimination cases.  

Line drawing.  In the Carnell case as well as in others, the corporations at issue had been certified as a minority/women owned business at the state level, which is treated as a form of pre-requisite for such standing to assert a racial discrimination claim.  There is no similar bright line test or religious entity process for a for-profit corporations.  Indeed the very process of such a certification may implicate other 1st Amendment protections for freedom of speech and association.

Third Parties & Equity. Second, imputing the racial identity to the corporation for purposes of a Title VI claim of racial discrimination upholds the minimum anti-discrimination standard against third parties.  So in the race cases, the identity of the owners is imputed to the corporation to prevent third parties from evading a legal standard.  In the corporate free exercise of religion context, the owners are requesting that their individual religious beliefs be imputed to the corporation to allow it to evade compliance with a law.  Anti-discrimination laws are applied generally and don’t allow a person to discriminate whether it is with an individual or through a corporation rather than exempting a corporation from a neutrally-applied, generally applicable law. 

This last points get to the debate, in part, about the relevance of reverse veil piercing (RVP) on which Professor Stephen Bainbridge has advocated as a framework to resolve the mandate issue in Hobby Lobby. The corporate veil is rejected in both CVP and RVP when equity requires and that is usually dependent upon a third party interest that is best protected by rejecting the legal fiction of a separate corporate form.  In the anti-discrimination/racial identity there is an equitable argument that the third party cannot discriminate against the corporation simply because it is owned by minorities.  What is the equitable argument in Hobby Lobby?  The fairness rationale is weakened here, especially in light of the interests of the 13.5K employees receiving health care coverage as a form of compensation for their work for the company.  Instead RVP, it must rest, if at all, on the public policy justification advanced by Professor Bainbridge.   But again, the public policy argument cuts both for and against RVP.  There is a public policy argument in protecting/promoting religious freedom as there is in facilitating access to health care, including forms of health care that Congress has determined to be necessary for women (and families) under the ACA.

 -Anne Tucker

April 23, 2014 in Business Associations, Anne Tucker, Constitutional Law, Corporations, Current Affairs, Joshua P. Fershee | Permalink | Comments (0)

Monday, April 14, 2014

D.C. Circuit Court Invalidates SEC Conflict Mineral Disclosures

In an opinion released earlier today, the D.C. Circuit Court struck down the SEC's Dodd-Frank Conflict Mineral Rule under the compelled speech doctrine for failing the least restrictive alternative prong.  

We therefore hold that 15 U.S.C. § 78m(p)(1)(A)(ii) & (E), and the Commission’s final rule, 56 Fed. Reg. at 56,362-65, violate the First Amendment to the extent the statute and rule require regulated entities to report to the Commission and to state on their website that any of their products have “not been found to be ‘DRC conflict free.’”

Not striking down the need for information about conflict minerals, but rather the required approach, the Court suggested that: 

[A] centralized list compiled by the Commission in one place may even be more convenient or trustworthy to investors and consumers. The Commission has failed to explain why (much less provide evidence that) the Association’s intuitive alternatives to regulating speech would be any less effective.

In August, 2012, the SEC released final Dodd-Frank rules for conflict minerals "requir[ing] companies to publicly disclose their use of conflict minerals that originated in the Democratic Republic of the Congo (DRC) or an adjoining country."


April 14, 2014 in Anne Tucker, Corporate Governance, Current Affairs, Securities Regulation | Permalink | Comments (0)

Thursday, April 10, 2014

JURIFY: Transactional Resources Pt. 2 (Hybrid Sources)

Earlier this spring, I posted about transactional resources  (the current source list is available here: Download Transactional Law Resources).

Continuing with the theme, I want to highlight a new hybrid resource, JURIFY, which is a mostly-free, online transactional law resource. 

“Jurify provides instant access to high-credibility, high-relevance legal content, including forms and precedent in Microsoft Word® format written by the world’s best lawyers, white papers and webinars from top-tier law firms, articles in prestigious law journals, reliable blog posts and current versions of statutory, regulatory and case law, all organized by legal issue.”

Here are the stats:  Jurify, launched in 2012, covers 5 broad transactional areas:  General Corporate, Governance, Mergers & Acquisitions, Securities and Startup Companies.  The 11,000+ sources that the website currently contains have been verified by transactional attorneys and generated from free on-line platforms or submitted by private attorneys who are voluntarily sharing their work.  Documents are organized according to 586 tags.  Three transactional attorneys started this website (husband/wife duo and their former law-firm colleague); none take compensation from editors, publishers or law firms. 

Jurify is a unique transactional law resource for the following reasons: 

  • FREE (mostly). Website contents including primary law, secondary sources and template agreements and forms.  All content is searchable; most is free; some templates/forms, available in Microsoft word version, require either a fee or a paid membership. In the future, Jurify founders hope to generate revenue by providing performance metrics and career services components. 
  • Emphasis on Primary Sources—collecting the most current and complete versions of governing statutes, and here is the important part—putting relevant sources together.  Want to find out registration obligations?  A search on Jurify will pull from several different sources to give you a comprehensive look at the governing law.
  • Organization.  The website resources are organized in a consumer-friendly, vertically integrated platform (like the searching functions on YouTube).  If you search for one term of art, (the example used was break-up fees), the search results pull all related terms of art (i.e., termination fees, reverse break-up fees, etc.).  The data base has been encoded with 1600 corporate law synonyms in the platform to facilitate more robust natural language searches.
  • Multiple search modes (i.e., accessible for the novice).  Non-experts can search for information using tags and drop down boxes to sort information by source type (news articles, videos, journals, statutes and regs, etc.).   The site also includes a glossary of terms, and those terms serve as searchable categories that have documents associated with them. 
  • Narrowing the field.  You don’t need every document- you just need the right document.  Researchers can narrow search results through subcategories, which include definitions on all of the subcategories to assist the non-expert (i.e., students, generalist attorneys like some in-house teams). Within general categories, researchers can also conduct granular searches within a topic and can narrow by specific fields (i.e., M&A).
  • Sorting the results.  Search results are displayed in order of relevance.  Relevance, in Jurify, is determined by the tags assigned by Jurify attorneys reviewing and labeling each document in the database.  While a document may have 15 tags, 2 or 3 tags will be the primary tag, and the document will be flagged as “noteworthy” for that particular topic.  The idea is that you review the most relevant documents first not just any document that contains any reference to your search fields.
  • Networking Component.  Some of the documents are voluntarily provided by practicing attorneys and their names remain associated with the document(s). If an attorney wants to establish herself as an expert in an area, she may do so in part, by contributing high-quality documents on that topic.  Top contributors are highlighted on the website, using in part, a Credibility Score. In the future, a ranking/review feature will be added so that users can provide feedback on the quality/relevance of a document as well.

Erik Lopez, co-founder of Jurify, contacted the BLPB editors earlier this spring.  As a result, I test drove the site with Erik a few weeks ago, which formed the basis of my comments above.  Thanks Erik!  (Note: Neither BLPB nor I, individually, received any compensation as a result of this post. I am passing it along because I genuinely am intrigued by the platform, business model, and potential for the website to be a valuable transactional resource.)

If anyone currently uses Jurify, or test drives the site after reading this post, please share your experience in the comments.

-Anne Tucker

April 10, 2014 in Business Associations, Anne Tucker, Corporations, Law School, LLCs, Merger & Acquisitions, Securities Regulation, Teaching, Web/Tech | Permalink | Comments (0)

Wednesday, April 9, 2014

Questioning the Right to Proxy: Commission Gallagher’s Remarks on the Shareholder Proposal Process

On March 27th, SEC commissioner Daniel M. Gallagher’s delivered the keynote address at the 26th Annual Corporate Law Institute  at Tulane University Law School.  Addressing the intersection of governance and securities disclosure, Commissioner’s Gallagher’s remarks (available here) are summarized below:

Dodd Frank increased the federalization of corporate law.

“This mandated intrusion into corporate governance will impose substantial compliance costs on companies, along with a one-size-fits-all approach that will likely result in a one-size-fits-none model instead.”

Shareholder proposals are costly, problematic and used by only a small group of shareholders with particular interests and agendas that may not be alligned with other shareholders. Citing first to the 41% increase in shareholder proposals post Dodd-Frank, and the meager 7% passage rate, Commission Gallagher outlined which shareholders use the proposal process and the punch line is that only 1% are brought by ordinary institutional investors.

  • 34% are from organized labor;
  • 25% are from social, policy or religious institutions; and
  • 24% of the proposals were brought by just two individuals whom the Commissioner described as “corporate gadflies.”

The shareholder proposal process should be reformed by narrowing the scope of those eligible to bring proposals and the subject matter of the proposals.

  • Increase holding amounts and time (specifics not provided);
  • Clarify the application guidelines for the “ordinary business operations” exclusion and the “significant policy issue” exception to the exclusion;
  • Have commissioners vote on exclusions, not leave it to the staff;
  • Create greater authority to exclude misstatements; and
  • Substantially strengthen resubmission thresholds (suggesting a three strikes you are out rule).

While not a heading of the remarks, another clear take away is the Commissioner’s stance against viewing climate change as a serious policy issue and that conflict mineral reports do not “provide investors with the information they need to make informed investment decisions.” To further this point, he discredited third parties, like the Sustainability Accounting Standards Board, as having no role in shaping disclosure requirements.

You should read the full remarks, if nothing else, for this line: “Mike D. of the Beastie Boys—who, by helping to bring the proposal to a vote, at least succeeded in his fight for the right to proxy.”


April 9, 2014 in Business Associations, Anne Tucker, Corporate Governance, Corporations, Securities Regulation | Permalink | Comments (0)

Wednesday, April 2, 2014


Fellow BLPB contributor and friend, Haskell Murray, bravely posted his view of FOMA and Family yesterday.  I am contributing to the conversation with my own view of the issues he raised.  Both of our posts are born of conversations we have been having off line for the past several months.


We are approaching (if not there already) the point in the semester when I typically feel overloaded by remaining materials for class and year-end administrative responsibilities, fatigue from spring writing deadlines and travel, and a little puzzled by how a summer that isn’t even here yet, already feels “full”.   I know that I haven’t struck the right balance, especially not with an infant at home.  And yet, if the phone rang tomorrow with an opportunity that I couldn’t pass up, I would instantly add it into the mix subtracting from “free” time and further bloating the scheduled column.  I know that I am not alone. 

 I want to explore two ideas:  “opportunities that can’t be passed up” and “free time”.

The bottom line is that I am grateful to have a job that is rewarding, engaging, flexible, and ultimately fun.  I look at the pool of candidates we bring in each fall and consider myself immeasurably lucky to be on this side of the vote.  At the base of my gratitude is a sneaking suspicion that maybe I don’t belong and that a mistake or an oversight was made in hiring me.  So I work very hard to hide that unscratchable itch of doubt in myself and to allay it, should it arise, in any colleagues.  From this place of uncertainty all opportunities, any opportunity, can look like one that can’t be passed up or turned down.  I have confessed to Haskell that I feel like if I say no that it will turn the tide of good fortune against me, and I will lose all of the good luck that brought me to this profession, and to my school.  And so I say yes.  To everything.

I want to adopt a lens that helps me view opportunities as what they are—a potential path, not a destination.  Opportunities and invitations are not things to be hoarded, gobbling up as many as I can count.  Invitations are not validation.  [Note that as I write this, I am gripped with the fear that someone reading this was thinking about inviting me to something and now they won’t…is it too contradictory to ask that you still consider inviting me?].  Invitations to present or to collaborate are an opportunity to move in a direction.  But we can’t move in all directions at once: we must focus on where it is we actually want to go.

And this brings me to free time. Leaving  personal free time aside (and my desire to spend one morning a week with my son over the summer), I want to focus on something even less discussed:  professional free time. I want to carve out space to be contemplative about my direction and the steps that I need to take in order to develop my scholarship. I don’t mean setting a writing deadline for my next article, but I mean thinking broadly about what I want to do with my research.  Of course we all want to do good work, and outside of tenure standards, individually we make our own value judgments about what “good work” means.  Instead of writing the next article as an act of self-propelling force driven by submission cycles and symposiums, I want to revisit the notion of a scholarly agenda like the ones provided by candidates each fall.  I want to map out where I need to go and the skills necessary to get there.  I think that if I let my FOMA drive me to commit to everything that I will remain a slave to the schedule and fail to stake out my own path, set my own course, and pick the right opportunities to take me where I want to go.  Only if I regain a bit of control over my schedule, can I ever hope to strike the right balance professionally and for my family.

So I turn the question to you—do you experience professional FOMA and how do you counter it? 

 -Anne Tucker

April 2, 2014 in Anne Tucker | Permalink | Comments (0)

Wednesday, March 19, 2014

Hershey Section 220 Suit: A New Era in Issue Activism

A hearing in the Delaware Court of Chancery highlights the question raised in my earlier post of institutional shareholder activism and provides a timely example of one brand of shareholder activism:  issue activism.

Yesterday, Vice Chancellor J. Travis Laster denied Hershey's motion to dismiss a books-and-records suit brought by shareholder Louisiana Municipal Police Employees' Retirement System. The suit seeks inspection of corporate books to investigate claims that the chocolate company knowingly used suppliers violating international child labor laws.  A full description of the hearing is available here.

UPDATE, Kent Greenfield who has been involved in the case, provided me with a copy of the Hershey hearing & ruling ( Download Hershey Ruling) as well as some context for the case.  Yesterday's hearing did two things. First, it clarified the standard of review for motions to dismiss section 220 books and records demands. Citing to Seinfeld v. Verizon Commc'ns, Inc., 909 A.2d 117, 118 (Del. Supr. 2006), the proper standard is whether a shareholder has provided "some evidence to suggest a 'credible basis' from which a court can infer that mismanagement, waste or wrongdoing may have occurred."    Second, the books and record request was brought on the novel theory that corporate violations of law (domestic and international) are ultra vires and within the scope of shareholder enforcement. The ultra vires corporate enforcement theory is discussed in more detail in this 2005 article by Professors Greenfield and Sulkowski. 

-Anne Tucker


March 19, 2014 in Business Associations, Anne Tucker, Corporate Governance, Corporations, Current Affairs, Social Enterprise | Permalink | Comments (1)

Thursday, February 20, 2014

Facebook, LinkedIn, and Twitter- Who needs them?

Our BLPB group has had a number of email discussions recently about the use of social media including blogs, Facebook, LinkedIn and Twitter for professional purposes. My home institution has discussed the same topic and even held a “training” session on technology in and outside of the classroom.  Because I am a heavy user, I volunteered to blog about how I use social media as a lawyer and academic in the hopes of spurring discussion or at least encouraging others to take a dip in the vast pool of social media.

Although I have been on Facebook for years, I don’t use that professionally at all. I also don’t allow my students to friend me, although I do know a number of professors who do. I often see lawyer friends discussing their clients or cases in a way that borders on violations of the rules of professional conduct, and I made sure to discuss those pitfalls when I was teaching PR last year.

I have also used LinkedIn for several years, mainly for professional purposes to see what others in my profession (at the time compliance and privacy work) were thinking about.  I still belong to a number of LinkedIn groups and have found that academics from other countries tend to use LinkedIn more than US professors. I have received a number of invitations to collaborate on research just from posts on LinkedIn. I also encourage all of my law students to join LinkedIn not only for networking purposes, but also so that they can attract recruiters, who now use LinkedIn almost as often as they use headhunters.  When I blog, I link my posts to LinkedIn, which in turn automatically posts to Twitter.

I admit that I did not like Twitter at first. I now have three Twitter accounts- follow me at @mlnarine.  I started using Twitter when I was a deputy general counsel and compliance officer and I followed law firms and every government agency that was online that regulated my industry. The government agencies were very early to the Twitter game and I once learned about a delay in the rollout of a regulation via Twitter a full week before my outside counsel who was working on the project informed me.

I also use the hashtag system (#) to see what others are saying on topics that hold my interest such as #csr (corporate social responsibility and unfortunately also customer service rep), #socent for social enterprise, #corpgov for corporate governance, and #Dodd-Frank  and #climatechange (self explanatory). 

I make an effort to tweet daily and am now an expert in trying to say something useful in 140 characters or less (being on yearbook staff in high school and counting characters for headlines made this a breeze for me). I re-tweet other tweets that I believe may be of interest to my followers or links to articles, and often gain new followers based on what I have chosen to tweet, largely because of my use of hashtags. In fact, after a marathon tweeting session following the Dodd-Frank conflict minerals oral argument before the DC Circuit Court of Appeals, I received four calls from the press for interviews, a nice, unexpected benefit of trying to educate my followers.  Often when I attend conferences, such as last week’s ABA meeting or the UN’s Business and Human Rights Forum, the organizers develop a hashtag so that those who cannot attend in person can follow the proceedings through tweets and the attachments to those tweets.

The best part of twitter is that I met fellow blogger, Haskell Murray because of one his tweets and that led to an invitation to speak at a conference.  Haskell has published a useful  list of business law professors on Twitter so if you’re not on his list, let us know and we will update it.

Next week I will post about the benefits or perils of blogging, especially for someone new to academia.    

February 20, 2014 in Business Associations, Anne Tucker, Conferences, Corporate Governance, Corporations, Current Affairs, Entrepreneurship, Ethics, Haskell Murray, Marcia L. Narine, Social Enterprise, Stefan J. Padfield, Teaching, Web/Tech | Permalink | Comments (0)

Wednesday, February 5, 2014

Transactional Law Resources pt. 1

If you practiced as a transactional attorney before law teaching, chances are that you looked at form agreements provided in treatises, saved on your law firm database, handed to you by partners from past deals, or saved in your own template archives.  This is no different from what litigators do either—they look for model existing memos, complaints, document requests, etc. that guide the first draft and let you start somewhere past “zero”.  The rapidly changing legal environment and unique needs of each client in each deal limits the shelf life of form agreements and saddles them with all sort of potential downsides if they aren’t used thoughtfully, verified by research, or tailored to the specific deal.  This disclaimer aside, I am curious about how we teach students about the role of exemplars, and as a starting point, where to find exemplars.  Students and junior attorneys, if not given the right tools to find the best models, will use bad model forms.  If you don’t believe me, see what you get when you search for “standard asset purchase agreement”. 

This raises the question of where should students, attorneys, law professors wanting to incorporate experiential learning exercise modules into their courses look for these resources. 

 This post will be the first in a series that will highlight these resources.  If you have suggestions for a source, please leave a comment or email me at [email protected].  I will compile a list of sources and link a word document in the final post.  If there is interest, I will be happy to update the list over time.  For now, the first installment of free, publically available resources.  Paid sources will be next.

-Anne Tucker

February 5, 2014 in Business Associations, Anne Tucker, Merger & Acquisitions, Partnership, Teaching | Permalink | Comments (4)

Wednesday, January 29, 2014

Contracts Content

I recently discovered that YouTube hosts a collection of content related to contracts. If you teach this first year course, it is at least worth browsing through the options to see if you can include something in class, a follow-up email to students, or linking through your course website.  These videos are silly and hard to believe that one could devote so much time to a task like "contracts" songs, but bless those who do.  

Collection of Contracts Songs #1: 

Collection of Contracts Songs #2

If you use other content in your first year contracts course, please leave a comment or send me an email. I will update the post with your suggestions.


January 29, 2014 in Anne Tucker, Teaching | Permalink | Comments (2)

Wednesday, January 22, 2014


Today marks the 4 year anniversary of the Citizens United decision and tomorrow marks the 41st anniversary of Roe v. Wade.  Corporations, the First Amendment, and Reproductive choice/freedom may have seemed like odd bed-fellows, but all three issues come together in the upcoming Hobby Lobby case challenging the application of access to birth control required under the health care law to a corporation whose owners oppose the extension on the grounds of religious freedom. 

Consider this a teaser on the issues offered up in the Hobby Lobby case.    Law professors are filing amicus briefs on this case coming down on either side of the issue.  One group arguing that religious views of the owners should not protect the corporation from complying and another arguing that the religious views of the owners can be imputed to the corporation and thus exempt it from compliance.  This is set to be a fantastically interesting issue, and hopefully one that will generate some healthy debate on this blog.  There will be more to come from me on this issue, but for now...consider this a teaser (or a place holder).

And if you crave more substance and internet sleuthing this afternoon, let me refer you to a list of 7 charts that is making its rounds in the blogosphere today. These charts detail the consequences of Citizens United in the last four years.  The results are not surprising and include:increased outside spending, conservative spending outpacing liberal spending 2:1, more political ads and occurring earlier, and decreased disclosures.  You can see the version posted by the Washington Post here.

-Anne Tucker

January 22, 2014 in Business Associations, Anne Tucker, Constitutional Law, Religion | Permalink | Comments (0)

Thursday, January 16, 2014

1 Report, 4 Issues

(1) Corporate Disclosures, (2) Indirect Advocacy, (3) Climate Change, and (4) Institutional Investors 

The Union of Concerned Scientists, an alliance of more than 400,000 citizens and scientists, released a report today: Tricks of the Trade: How Companies Influence Climate Policy Through Business and Trade Associations.  The report is based on data collected by CDP, an international not-for-profit that “works with investors, companies and governments to drive environmental disclosure”.  CDP administers an annual climate reporting questionnaire to more than 5,000 companies worldwide with the support of various institutional investors (722 institutional investors with over $87 trillion in capital). The 2013 questionnaire asked companies about climate policy influence, including board membership in trade associations, lobbying, and donations to research organizations.

Tricks of the Trade highlights outsourced political influence through the use of trade associations and interest groups that lobby on behalf of their members rather than the members engaging in these activities in their own name.  The report highlights 3 main issues:  (1) lack of transparency, (2) incongruence with the outsourced message among responding companies, and (3) the continued role that the Citizens United decision has on corporate spending and political discourse.


  • Of the 5,557 companies that received the climate change questionnaire (through either CDP’s request or their voluntary participation), 2,323 responded, and only 1,824 (33 percent) of them replied publicly.
  • Ninety-seven Global 500 companies—the top 500 companies in the world by revenue—including Apple, Amazon, and Facebook, did not participate.  
  • In the Standard & Poor’s (S&P) 500—a market value index of large U.S. companies—166 companies, including Comcast and the Southern Company, did not participate.

The report highlights that proposed rules before the SEC for corporate political spending disclosures would address some transparency concerns and notes that the SEC has no plans to address this issue in 2014.  This is no small issue considering the number of institutional investors and amount of invested capital ($87 trillion, with a "T"!!) behind this initiatve.  CDP sends its survey to corporations on behalf of the signatory institutional investors who are shareholders.

These shareholder requests for information encourage companies to account for and be transparent about environmental risk. Transparency of this data throughout the global market place ensures the financial community has access to the best available corporate climate change information to help drive investment flows towards a low carbon and more sustainable economy


  • Ninety-five companies noted that at least one of their trade groups had a climate policy position that was partially or wholly inconsistent with their own, for a total of 172 such responses across all trade groups.

The 2013 questionnaire, while focused on climate change issues, is relevant to broader questions of corporate political influence and spending, the SEC’s agenda for 2014, and the role of corporate disclosures.   If you are teaching corporations/BA this semester, this 12 page report raises several issues that, in my opinion, would elicit a great classroom discussion when you get to the role and purpose of corporations,  sections on the disclosure regime of our securities markets, and even on shareholder rights to information.

-Anne Tucker

January 16, 2014 in Business Associations, Anne Tucker, Constitutional Law, Corporate Governance, Corporations, Financial Markets, Securities Regulation, Teaching | Permalink | Comments (0)

Wednesday, January 15, 2014

Delaware 2013 Corporate Law Round Up

Francis G.X. Pileggi and Kevin F. Brady at Delaware Corporate & Commercial Litigation Blog closely track Chancery and Supreme Court cases out of Delaware.  Their annual Delaware round up, is always a top-notch, quick  and dirty summary of the year. If you haven't kept up with the major cases, or want a quick reference when thinking about what developments to include in your classes this spring or next fall--then this list is for you.

Here are 2 additional cases that I have found noteworthy for some combination of scholarship, teaching and practice reasons:

1.  Chevron forum selection clause enforceability

Chancellor Strine’s opinion in Boilermakers Local 154 Retirement Fund v. Chevron Corp.,et al, upheld the enforceability of a Delaware forum selection clause unilaterally adopted by corporate boards of directors of Defendants.  Plaintiffs dismissed their appeal, and moved to dismiss their remaining claims in Chancery Court leaving intact Chancellor Strine strong support of forum selection clauses.  Chevron was preceded Chevron was preceded by National Industries Group (Holding) v. Carlyle Investment Managements LLC and TC Group LLC, a 2013 Delaware Supreme Court opinion, which addressed the contractual enforceability of forum selection clauses. 

2.  Huatacu Upholding waiver of dissolution rights when not “reasonably practicable” to carry on the business of the LCC.

VC Glasscock reaffirmed Delaware’s commitment to contractual freedom in LLCs by upholding an express waiver of statutory dissolution rights for LLC members.  The case enforced an LLC operating agreement that “rejected all default provisions, and expressly limited members’ rights to those provided in the LLC Agreement.”  The Chancery Court found that dissolution rights, were waivable by LLC members, but that the members remained subject to the non-waivable duty of good faith and fair dealing.  The Chancery Court also left open the possibility that members of an LLC may not divest the Court of all of its equitable authority to order dissolution, but where the parties presented no unusual facts giving rise to such equities, the waiver is enforceable.

-Anne Tucker

January 15, 2014 in Business Associations, Anne Tucker, Corporate Governance, Corporations, LLCs, Teaching, Unincorporated Entities | Permalink | Comments (1)

Tuesday, January 7, 2014

Citizens United 4 Year Anniversary Symposium: February 28, 2014

The following information was shared with me by my friend, Professor Ciara Torres-Spelliscy at Stetson Law.  On February 28, 2014, Stetson Law in Gulfport, FLorida, will host: 

Taking Stock of Citizens United: How the Law Has (and Has Not) Changed Four Years Later.

Panel One: Quantifying the Problem of Money in Politics
Citizens United opened a new avenue for corporations and unions to spend in politics by purchasing political ads. This ability to spend was added to older avenues of political activity such as corporate and union segregated funds (SSFs or PACs), lobbying and direct contributions in certain states. The question of what political spenders get in return for this largess remains an open one.
Panel Two: The Risk of Corruption Collides with Free Speech
From a Constitutional law perspective, the courts have long wrestled with the placing political spending into a single paradigm. On one hand, courts have recognized that running for political office is costly and fundraising implicates First Amendment concerns such as the freedom of speech and association. On the other hand, campaign spending can be a corrupting force in the democratic process. Layered on top of this is an impulse by the courts to treat different political spenders in distinct ways: state contractors, corporations, unions, nonprofits, political parties, PACs and individuals may find themselves subject to distinct legal rules in the same election.

Panel Three: Making New Rules that Help Taxpayers, Voters, Investors, Employees and Members
While Citizens United limited the scope of solutions that are available for campaign finance legislation, the decision leaves ample room for a wide range of reforms in the realm of tax law, employment law, corporate law and securities law. And the barriers to reform that Citizens United has constructed has inspired several legal and grassroots groups to work on a Constitutional Amendment to overturn the decision.

Registration is available online.

Before joining the academy, Professor Torres-Spelliscy worked as counsel in the Democracy Program of the Brennan Center for Justice at NYU School of Law.  The symposium line up contains a who's who of corporate political spending and first amendment scholars (include John Coates & Lawrence Lessig from Harvard) and industry experts.  The panels will provide balanced and in-depth discussions of the impact of Citizens United 4 years later.

 -Anne Tucker

January 7, 2014 in Business Associations, Anne Tucker, Constitutional Law, Current Affairs | Permalink | Comments (0)

Tuesday, December 31, 2013

Delaware Business Judgment Rule and Corporate Purpose Revisted

Lyman Johnson, Robert O. Bently Professor of Law at Washington & Lee, has a new article out in the Delaware Journal of Corporate Law titled, Unsettledness in Delaware Corporate Law: Business Judgment Rule, Corporate Purpose.

Abstract:  This Article revisits two fundamental issues in corporate law. One — the central role of the business judgment rule in fiduciary litigation — involves a great deal of seemingly settled law, while the other — is there a mandated corporate purpose — has very little law. Using the emergent question of whether the business judgment rule should be used in analyzing officer and controlling shareholder fiduciary duties, the latter issue having recently been addressed by Chancellor Strine in the widely-heralded MFW decision, this Article proposes a fundamental rethinking of the rule’s analytical preeminence. For a variety of reasons, it is suggested that fiduciary duties should be made more prominent and the business judgment rule should be dramatically deemphasized. The policy rationales for the rule are sound, but they have no relevance for shareholders and introduce needless complexity. For directors, those rationales do not apply in the loyalty setting, and in the care setting, can be achieved by recalling simply that there is no substance to judicial review in that context.

As to the corporate purpose, the Article advocates that Delaware law permit a pluralistic approach in the for-profit corporate sector. Long agnostic about ultimate corporate objective, Delaware law may have turned unnecessarily toward a strict shareholder primacy focus in the 2010 eBay decision. To bring clarification and to foster flexibility, Professor Johnson recommends a legislative default provision, with an opt-out feature. This feature should be in the business corporation statute itself. Delaware’s new benefit corporation law laudably advances the goal of institutional pluralism, but does so at the ironic risk of reinforcing a belief that business corporations themselves are legally permitted only to maximize profits. Judges in a democratic society should not dictate institutional goals.

Happy New Year!

-Anne Tucker

December 31, 2013 in Anne Tucker, Corporate Governance, Corporations | Permalink | Comments (0)

Wednesday, December 18, 2013

Year End Wrap up of Corporate/Campaign Finance Issues

In 13 Things We Learned about Money in Politics in 2013, written by Stetson Professor Ciara Torres-Spelliscy, numbers 9 and 10 highlight the intersection of corporate and campaign finance laws.

10. Disappointing nearly 700,000 members of the public who had asked for more transparency from public companies, the Securities and Exchange Commission (SEC) refused to require transparency for corporate political spending — for now.

9. Shareholder suits over corporate political spending bookended the year. In January, the Comptroller of New York sued Qualcomm, as a shareholder under Delaware law, to get their books and records of political spending. In December, the insurance giant Aetna was suedby a shareholder represented by Citizens for Responsibility and Ethics in Washington (CREW) for hiding its political spending.

To access the rest of the list and other campaign finance information provided by the Brennan Center for Justice, click here.

-Anne Tucker

December 18, 2013 in Anne Tucker, Constitutional Law, Corporate Governance, Corporations, Current Affairs | Permalink | Comments (0)

End of an Era: Federal Reserve Chairman Ben Bernanke's Last Press Conference Today

The main question is whether or not the Fed will begin tappering its current bond buying policy which has been in place since 2008.  NPR did a quick and accessible print and radio story on the Fed and the issue of tappering.  Both versions of the story are available here.  I've also posted on this blog before on the issues facing the Fed as leadership is about to change hands.

Watch it live at 2:30 pm today here.  

[editted today at 3:15]-- Summary of Fed Policy Announcements:

  • Fed will reduce (tapper) its bond buying program from $85 billion to $75 billion per month, with additional tapering expected as the economy continues to strengthen.


  • The policy at the Fed is dependent, in part, upon the rate of inflation, which has been running below the 2% benchmark.  “The [Fed] recognizes that inflation persistently below its 2 percent objective could pose risks to economic performance, and it is monitoring inflation developments carefully for evidence that inflation will move back toward it objective over the medium term.”


  • Short-term interest rates are expected to hold steady through 2014 with some anticipated increase in 2015, especially if the unemployment rate falls below 6.5% (as it is expected to do in 2014).


  • Today’s announcements are consistent with the policy outlined in the September meeting of the Fed, and indicate a gradually strengthening economy with a rising gross domestic product and falling jobless rate.

-Anne Tucker

December 18, 2013 in Anne Tucker, Current Affairs, Financial Markets | Permalink | Comments (0)

Friday, December 13, 2013

Call for Papers: National Business Law Scholars Conference

The National Business Law Scholars Conference (NBLSC) will be held on Thursday, June 19th and Friday, June 20th at Loyola Law School, Los Angeles. This is the fifth annual meeting of the NBLSC, a conference which annually draws together dozens of legal scholars from across the United States and around the world. We welcome all scholarly submissions relating to business law. Presentations should focus on research appropriate for publication in academic journals, especially law reviews, and should make a contribution to the existing scholarly literature. We will attempt to provide the opportunity for everyone to actively participate. Junior scholars and those considering entering the legal academy are especially encouraged to participate.

To submit a presentation, email Professor Eric C. Chaffee at [email protected] with an abstract or paper by April 4, 2014. Please title the email “NBLSC Submission – {Name}”. If you would like to attend, but not present, email Professor Chaffee with an email entitled “NBLSC Attendance.” Please specify in your email whether you are willing to serve as a commentator or moderator. A conference schedule will be circulated in late May.  More information is available here:,81539,en.html


Conference Organizers

Barbara Black (The University of Cincinnati College of Law)
Eric C. Chaffee (The University of Toledo College of Law)
Steven M. Davidoff (The Ohio State University Moritz College of Law)
Kristin N. Johnson (Seton Hall University School of Law)
Elizabeth Pollman (Loyola Law School, Los Angeles)
Margaret V. Sachs (University of Georgia Law)


December 13, 2013 in Business Associations, Anne Tucker, Corporate Governance, Corporations, Financial Markets, Merger & Acquisitions, Securities Regulation, Unincorporated Entities | Permalink | Comments (0)

Wednesday, December 11, 2013

AALS as an excuse to share a comic on conference presentations...

With winter break nearly upon us this means grading, writing projects, and possibly some conference travel with the upcoming AALS annual meeting.  I plan on putting together my AALS talk (on incorporating experiential exercises in teaching LLCs) next week, and have drawn inspiration from the following image:

Conference Image

The Business Law programs are on Saturday, January 4th and are listed below. If you would like to highlight other programs, please respond in the comments, and I will add to the list.


  • 2:00 pm - 3:45 pm Business Associations
    The Value Proposition for Business Associations in Tomorrow’s Legal Education
    • The panel will be exploring: How does business associations teaching and scholarship contribute to the U.S. program of legal education?  How could or should it contribute?  What role does the basic law school course on business associations play in an optimized law school curriculum?  What course content, pedagogy, and teaching tools best support that role?  How does business associations scholarship inform and support that role?    


  • 4:00 pm - 5:45 pm Transactional Law and Skills
    Value Creation By Business Lawyers in the 21st Century
    •  On the thirtieth anniversary of the influential article by Professor Ronald Gilson’s “Value Creation by Business Lawyers” this program will re-examine Professor Gilson’s thesis, evaluate the impact of the article, and discuss the prospects for business lawyers creating value in the 21st Century.  The panel will feature Professor Gilson, invited participants, and scholarly works selected from a call for papers.

This is my first year attending the AALS conference, and am going whole hog with plans to also attend the mid-year meeting in June, which will be a workshop on Blurring Boundaries in Financial and Corporate Law. The call for papers (expired)  includes a program description and is available here: 

-Anne Tucker



December 11, 2013 in Business Associations, Anne Tucker, LLCs, Teaching, Unincorporated Entities | Permalink | Comments (0)

Wednesday, December 4, 2013

SEC Excludes Political Spending Disclosures from 2014 Rule Making Agenda

Earlier this week the SEC released its 2014 rulemaking agenda and excluded from the list is a proposal for public companies to disclose political spending.  In 2011, the Committee on Disclosure of Corporate Political Spending, comprised of 10 leading corporate and securities academics, petitioned the SEC to adopt a political spending disclosure rule.  This petition has received a historic number of comments—over 640,000—which can be found here.

The Washington Post reported that after the petition was filed,

A groundswell of support followed, with retail investors, union pension funds and elected officials at the state and federal levels writing to the agency in favor of such a requirement. The idea attracted more than 600,000 mostly favorable written comments from the public — a record response for the agency.

Omitting corporate political spending from the 2014 agenda has received steep criticism from the NYT editorial board in an opinion piece written yesterday declaring the decision unwise “even though the case for disclosure is undeniable.” Proponents of corporate political spending disclosure like Public Citizen are “appalled” and “shocked” by the SEC’s decision, while the Chamber of Commerce declares the SEC’s omission a coup that appropriately avoids campaign finance reform.

Included in the 2014 agenda are Dodd-Frank and JOBS Act measures, as well as a proposal to enhance the fiduciary duties owed by broker-dealers.  More on the agenda in future posts….

-Anne Tucker

December 4, 2013 in Anne Tucker, Corporate Governance, Corporations, Current Affairs, Financial Markets, Securities Regulation | Permalink | Comments (0)

Tuesday, November 26, 2013

MIDAS-- Market Data by the SEC

For those of you interested in empirical research now or in the future, keep in mind the new MIDAS (Market Information Data Analytics System) data sets available from the SEC.

Every day MIDAS collects about 1 billion records from the proprietary feeds of each of the 13 national equity exchanges time-stamped to the microsecond. MIDAS allows us to readily perform analyses of thousands of stocks and over periods of six months or even a year, involving 100 billion records at a time.

MIDAS collects posted orders and quotes, modifications/cancellations, and trade executions on national exchanges, as well as off-exchange trade executions. 

SEC Midas

The methodology for MIDAS is available here.

Happy Thanksgiving BLPB readers!  

-Anne Tucker

November 26, 2013 in Anne Tucker, Financial Markets | Permalink | Comments (0)