Monday, January 26, 2015

Law Review Submission Season - Spring 2015

PrawfsBlawg has posted its Submission Angsting thread, which prompted me to write this post to ask our readers (including my co-bloggers) two questions:

  1. In your opinion, what is the ideal date to submit a spring law review article?
  2. When deciding between offers, how do you evaluate specialty law reviews?

Ideal Submission Date. When I first started as a professor, I heard that March 1 was the date most people thought was the best for spring submissions. The ideal date seems to be moving earlier and earlier, and I have heard February 1 or February 15 mentioned with increasing frequency. Some might suggest not worrying about the submission date -- just submit when your article when it is ready. While I agree that you should wait to submit an article until it is ready (whenever "ready" is...), I have had colleagues who seemed to seriously under-place articles because they submitted at a poor time. Admittedly, most of these professors submitted well outside of the traditional windows.

Evaluating Specialty Law Reviews. The question about how to evaluate specialty law reviews reoccurs every time I submit an article. The conventional wisdom is - find out how your P&T committee values those journals and follow their lead. That is good advice, though I imagine some readers would like to hear how the market, in general, values specialty law reviews. Personally, I have published in a number of specialty law reviews -- for two main reasons -- (1) readership (e.g., I used to see the Delaware Journal of Corporate Law on my judge's desk regularly) and (2) name recognition (the Harvard Business Law Review is probably going to go much further with many readers (and my P&T committee) than many flagship law reviews). I've heard formulas to rank specialty journals like -- take ~25 spots [the PrawfsBlawg post in the update below says +25 to +50] off the publishing school's rank if it is a specialty journal (this doesn't work well when a top journal in your area is published by a low-ranked school) OR the top 10% or so specialty journals in your area are roughly equal to a 31-100 ranked flagship journal; and you should take a top-30 flagship journal over virtually any specialty journal. I know different schools will treat the question of specialty journals differently, and ideally we wouldn't have to play this game (because the articles all end up on WestLaw), but I am truly interested in the different approaches.

Update: On the second question I found this helpful post on PrawfsBlawg from 2011, but I am still interested in other thoughts. 

Feel free to share thoughts in the comments, or e-mail me directly. 

January 26, 2015 in Law Reviews, Haskell Murray, Law School | Permalink | Comments (2)

Friday, January 23, 2015

Social Enterprise Resources Updated - January 2015

I recently updated my research chart entitled Corporate Forms of Social Enterprise: Comparing the State Statutes. Always open to suggestions on how to improve the chart.

As the number of corporation-based social enterprise state statutes has grown, the chart has become a bit unwieldy. Previous versions of the chart went state by state, detailing the differences from the Model statute. I think the new format (a short summary chart with details in the footnotes) is better for comparing/contrasting the state statutes, but is still far from perfect. For example, some of the abbreviations used in the summary chart require going to the footnotes for explanation, but it is difficult to remedy that and keep the summary chart short.  

Also, here is a link to the latest report of Delaware Public Benefit Corporations ("PBCs"). [This is my first time linking to an outside Excel sheet, but it worked for me by saving to my Desktop and then opening.]  The number of Delaware PBCs has grown to 234 entities. This is still tiny in comparison to the more than 1 million total entities in Delaware, but it is still early.

January 23, 2015 in Business Associations, Haskell Murray, Social Enterprise | Permalink | Comments (0)

Friday, January 16, 2015

An Effective Professor: Students' Views

Every semester, in an attempt to learn my students' names and a bit about them, I ask my students to fill out a student information form with a few questions. This semester I added the question: "What do you think makes a professor effective?"

The vast majority of the responses fell into one of the four categories below (listed in order, from most to least responses):

  1. Real world experience/real world examples
  2. Fairness in grading 
  3. Clarity in teaching 
  4. Approachability and accessibility 

I am teaching over 100 total students (undergraduate and MBA) this semester, and nearly every student mentioned something that would fall into at least one of those four categories.

Perhaps these responses do not surprise readers, and they were not incredibly surprising to me. The ordering, however, was a bit surprising, and I am not sure I would have expected to see "approachability" in the responses as much as I did. In any event, the responses were helpful in confirming that my time "staying current," meeting with local attorneys/business people, and consulting is well spent - at least in the eyes of my students. 

Is there anything in the students' responses that is surprising to readers? Is there anything missing from the list? (There were plenty of other answers but most of the repeated answers fell into one of the four categories.)

January 16, 2015 in Business School, Haskell Murray, Teaching | Permalink | Comments (1)

Friday, January 9, 2015

A Few Recent Delaware Cases

There are many Delaware cases from 2014 that are worth reading, but below are three relatively recent Delaware cases that I found worthwhile.  I provide the case name, my very short takeaway, and links to the case and additional commentary for those who wish to dive deeper.

In re Zhongpin Inc. Stockholders Litigation, controlling stockholders, decided Nov. 26, 2014. In denying a motion to dismiss, the Delaware Court of Chancery found a reasonable inference that a 17.3% stockholder/CEO could be a “controlling stockholder.” I have not done an exhaustive search on this issue, but this is a lower percentage of ownership for a “controlling stockholder” than I have seen in most cases, though (of course) the analysis is case specific. Additional commentary by Toby Myerson (Paul Weiss).

C.J. Energy Services, Inc. et al v. City of Miami General Employees’ and Sanitation Employees’ Retirement Trust, M&A/Revlon, decided Dec. 19, 2014. The Delaware Court of Chancery held that “there was a ‘plausible’ violation of the board’s Revlon duties because the board did not affirmatively shop the company either before or after signing.” (pg. 3). The Delaware Court of Chancery enjoined the shareholder vote on the transaction at issue for 30-days and “required [the defendant] to shop itself in violation of the merger agreement . . . which prohibited [the defendant] from soliciting other bids.” Id.  In this case, the Delaware Supreme Court reserved, stating that the Court of Chancery did not fulfill the stringent requirements for issuing a mandatory injunction, reminding that there are various ways to satisfy Revlon, and mentioning that this case did not have evidence of “defensive, entrenching motives,” as seen in Revlon and QVC. Note that the 38-page opinion was cranked out in just two days after the case was submitted. The handling of these expedited cases by the Delaware courts is one of the things that make Delaware attractive to corporations. Additional commentary by Brian Quinn (Boston College).

United Technologies Corp. v. Lawrence Treppel, books and records, decided Dec. 23, 2014.  The Delaware Supreme Court reversed the Delaware Court of Chancery’s holding that the Court of Chancery did not have authority to restrict documents produced in a books and records inspection to use only in cases filed in Delaware courts. The Delaware Supreme Court remanded to the Delaware Court of Chancery to decide whether the Court of Chancery will exercise its discretion to so restrict the use of the information obtained in the books and records inspection. In this case, United Technologies insisted that Treppel sign a confidentiality agreement when he sought to inspect books and records, which is fairly common, but the confidentiality agreement also limited the forum, of any claim brought using the information inspected, to Delaware courts. At the time of the inspection request, United Technologies did not have a forum selection clause in its bylaws, but it later adopted one. As the broader forum selection debates continue, it will be interesting to see how the Delaware Court of Chancery handles this case in the books and records context, especially because the Delaware Court of Chancery has been encouraging plaintiffs to use the “tools at hand,” such as books and records requests, before filing derivative lawsuits.  Beyond the substance, one remarkable thing about this decision is that Chief Justice Leo Strine authored an opinion that was only 14 pages. When he was on the Court of Chancery he would author 100+ page opinions with some regularity. Granted, the Court of Chancery is a trial court and their opinions tend to be a good bit longer than the Delaware Supreme Court opinions, regardless of the judge. Additional commentary by Celia Taylor (Denver Law).  

For reading beyond these three cases, former Delaware Supreme Court Justice Jack Jacobs comments on two additional recent Delaware cases here (M&A related). 

January 9, 2015 in Business Associations, Corporate Governance, Corporations, Delaware, Haskell Murray, M&A | Permalink | Comments (3)

Friday, January 2, 2015

E-mail Fasts

One of my new year's resolutions for 2015 is to fast from e-mail every Saturday. Now that I have posted this, my co-bloggers and readers can keep me accountable. Currently, I probably check my e-mail 20+ times a day, every day -- a habit formed during law firm life.  

I thought about fasting from the internet/electronics entirely on Saturdays, and I am still going to try to avoid the internet/electronics on Saturdays as much as possible, but I wanted to set a realistic goal. 

An acquaintance of mine in New York City, Paul Miller, went without the internet for an entire year (with less promising results than he had hoped). While I remember a time before the internet -- and a time when the internet was so slow it was almost useless -- it is hard for me to imagine going without the internet for a week, much less for a year.  That said, I think it healthy to loosen the electronic leash a bit every once in a while.  

I'd also like to cut back the number of times I check e-mail and the amount of time I spend responding to e-mails in general. If any readers, have suggestions on the appropriate amount of time on e-mail (for a professor), I would be interested. Obviously, it may vary a bit from week to week, but I am thinking about moving to checking e-mail twice a day during the week for 15 minutes each. I think this will allow me to continue being "responsive" to students and colleagues,  but will also free up a great deal of time. Most of the longer e-mails I write could probably be much shorter or would be better as conference calls or in-person meetings. 

What are your 2015 resolutions, or are you among the roughly 55% who do not set new year's resolutions?

Sadly, according to one study, only about 8% of people keep their new year's resolutions. For those of you who have set new year's resolutions, here is Professor Cass Sunstein with advice for keeping resolutions. Also, StickK.com (co-created by Yale University economics professor Dean Karlan) is a website where you can create commitment contracts, appoint a referee, and set the stakes for achieving or failing to reach your goals.    

January 2, 2015 in Business School, Haskell Murray, Law School, Technology, Web/Tech | Permalink | Comments (0)

Tuesday, December 30, 2014

Courts and the LLC, End of the Year Edition

I continue to document how courts (and lawyers) continue to conflate (and thus confuse) LLCs and corporations, so I did a quick look at some recent cases to see if anything of interest was recently filed. Sure enough, there are more than few references to "limited liability corporations" (when the court meant "limited liability companies."  That's annoying, but not especially interesting at this point.  

One case did grab my eye, though, because because of the way the court lays out and resolves the plaintiffs' claim.  The case is McKee v. Whitman & Meyers, LLC, 13-CV-793-JTC, 2014 WL 7272748 (W.D.N.Y. Dec. 18, 2014).  In McKee, theplaintiff filed a complaint claiming several violations of the Fair Debt Collection Practices Act against defendants Whitman & Meyers, LLC and Joseph M. Goho, who failed to appear and defend this action, leading to a default judgment. After the default judgment was entered, defense counsel finally responded.  

This case has all sorts of good lessons.  Lesson 1: don't forget that all named parties matter.  Get this: 

Defense counsel admits that he was under the mistaken assumption that default was to be taken against the corporate entity only. See Item 17. However, default was entered as to both the corporate and individual defendants on July 3, 2014 (Item 9). Defense counsel did not move to vacate the default and in fact did not respond in any way until the default judgment was entered on September 17, 2014. Item 12. Even then, the defense motion was framed as one for an extension of time in which to file an answer (Item 14), rather than a motion to vacate the default or default judgment. Inexplicably, in his papers, defense counsel states that a default judgment has not been entered. See Item 17. Since good cause is to be construed generously and doubts resolved in favor of the defaulting party, see Enron Oil Corp., 10 F.3d at 96, the court will accept the explanation of defense counsel as evidence of a careless lack of attention to procedural detail rather than an egregious and willful default on the part of defendant Goho [the individual and apparent owner of the LLC].
McKee v. Whitman & Meyers, LLC, No. 13-CV-793-JTC, 2014 WL 7272748, at *1 (W.D.N.Y. Dec. 18, 2014).  A link to a free version of the case is here.
 
Wow.  I concede there are some procedural details here, but this sure sounds substantive to me, as well.  
 
Lesson 2: if you name someone in the caption, you probably want to have some allegations about them as a defendant.  Fortunately for defense counsel, the plaintiff's counsel was not on the ball, either.  Though Goho was named in the caption, the complaint did not describe Goho as a party or contain allegations about Goho's individual liability for the FDCPA violations. The defendant's Prayer for Relief also only sought judgment from the Whitman & Myers, LLC. (The court conveniently skips the fact that court probably should have noticed these deficiencies the first time around, before entering default judgment against Goho.)  

Finally, the moment regular readers (see, e.g.,  here, hereherehere, and here) saw coming:
 
Lesson 3: You Can’t Pierce the Corporate Veil of an LLC Because It Doesn't Have One.  The plaintiff argued that "the court should pierce the corporate veil and hold defendant Goho personally liable." The court's response: "[T]here is nothing on the face of the complaint or in the record that would support individual liability for defendant Goho on the basis of corporate veil-piercing . . ."  
 
The court is, of course, correct. However, the sentence should be followed by one that says, "This is because there is no corporation named as a party to this case, so there is no corporate veil to pierce."  Obviously, the court could have gone on to note that even if the plaintiffs meant for the court to pierce the limited liability veil of the LLC, the allegations were insufficient for that, too.
 
As a side note, it would have been interesting to see how the court would have dealt with the argument that Goho and his LLC were so intertwined that they share legal counsel and that even his own counsel did not immediately recognize the individual and the entity as separate until after default judgment was entered.  (I don't see that as a winning argument, but it's better than what was argued.) 
 
Moving forward, I'd like to see courts tell plaintiffs that a request to "pierce the corporate veil" of an LLC amounts to a failure to state a claim.  The court should allow counsel to amend the complaint to get the language right. Until there is a consequence, even a minor one, for merging LLCs and corporations, attorneys and courts will continue to get it wrong.  
 
Thus, a New Year's Resolution for Courts:  "We will treat corporations and LLCs as separate entity types."  And, please, after making sure to always call LLCs "limited liability companies," move on to creating separate veil piercing language.  

December 30, 2014 in Business Associations, Corporations, Haskell Murray, Joshua P. Fershee, LLCs, Unincorporated Entities | Permalink | Comments (2)

Entrepreneurship Books by Jason Gordon

This week I received the notice below from Professor Jason Gordon. Professor Gordon is a legal studies and management professor at Georgia Gwinnett College, School of Business. As explained below, he is offering copies of two entrepreneurship books that he thought might be useful to BLPB readers.  

Dear Colleagues,

 

I recently published two texts entitled Business Plans for Growth-Based Ventures and Understanding Business Entities for Entrepreneurs and Managers. These books are designed for use by clinical law professors and as a supplement in entrepreneurship courses. The second text concerns entity selection considerations, but includes entity funding and conversion considerations and specific considerations for startup ventures.

 

The texts also contain supplemental electronic material available for free at TheBusinessProfessor.com.

 

If any of you would like a free copy of either text in Amazon e-book format, please send me your email address at jgordon10 [at] ggc [dot] edu.

 

A preview of the Business Plans E-Book is available here.

 

A preview of the Business Entities E-Book is available here

 

December 30, 2014 in Business Associations, Books, Business School, Entrepreneurship, Haskell Murray, Law School, Teaching | Permalink | Comments (0)

Friday, December 26, 2014

Law Firm Alumni Networks

Over the past few months, I have received a number of e-mails from the alumni associations of each of my two former law firms.  

In theory, I think these alumni networks are good ideas. They could help us keep in touch and could introduce us to people with common ties to those law firms. They could also help the law firms maintain ties with alums who could become clients.  

In practice, however, I rarely use any of the alumni services offered.

One of the main reasons is that my former firms do not have offices where I currently live (in Nashville) and they rarely, if ever, have events here.  If I still lived in Atlanta or New York City, I would probably attend some of the offered alumni CLE events, but I am probably never going to travel for them. 

As to the online alumni networks on the law firms' websites, I think the contact information for alums probably stays relatively out of date (as people choose to update their information on major social networks, but may forget about the ones at the law firms).  LinkedIn law firm alumni groups are probably the most useful thing that the law firms do, but I find the content posted there is generally not that helpful and can be dominated by some desperate group member salesperson.  (I also think LinkedIn is the least user friendly of the major social networks, but that is a topic for another post). 

What law firm alumni network efforts have you seen be successful? Are they worth the effort that major law firms seem to be putting into them?

December 26, 2014 in Haskell Murray, Jobs, Web/Tech | Permalink | Comments (2)

Friday, December 19, 2014

Social Subsidiaries

This week I had nice conversations with Brad Edmondson (Author of Ice Cream Social: The Struggle for the Soul of Ben & Jerry’s) and Michael Pirron (CEO of ImpactMakers, a certified benefit corporation).*

Both conversations turned to a topic that has been on my mind recently – that of social businesses that are acquired by large conglomerates that do not seem to have a similar mission.

A few of the parent/sub relationships that spring to mind (or that were discussed) include:

  • Campbell Soup / Plum Organics
  • Coca-Cola / Honest Tea
  • Colgate-Palmolive / Tom’s of Maine
  • Clorox / Burt’s Bees
  • Group Danone / Stonyfield Farm   
  • Unilever / Ben & Jerry’s

I may update this list from time to time, so feel free to suggest additions in the comments. 

At The Guardian, Kyle Westaway argues that Burt Bees worked from within Clorox to make the entire company more sustainable. Similarly, some argue that Unilever has become more sustainable after (and maybe because of) their acquisition of Ben & Jerry’s.

I have heard others argue that social businesses like Burt's Bees and Ben & Jerry’s “sold out,” and that the acquiring large conglomerates tend to cut many socially beneficial initiatives. The conglomerates, these folks argue, are only doing enough for society to keep the customer goodwill and the resulting profits. 

While each acquisition is different, I imagine both sides of the argument can find some support in the facts.

As someone interested in corporate governance, I hope to explore the governance issues involved when a conglomerate owns a social subsidiary in future articles. In Ben & Jerry’s case, I know they put a number of interesting clauses into the acquisition agreement, such as restricting certain action by Unilever regarding employees and local operations (for a period of time) and establishing an independent (and I believe self-perpetuating) board of directors for Ben & Jerry’s.  I am still investigating exactly how much power the Ben & Jerry’s board of directors has, and Unilever did eventually lay off some Ben & Jerry’s employees and close some local plants. In addition, Unilever and Ben & Jerry’s have not always agreed and have taken different, public stances on issues like GMO labeling. But Unilever has become a champion of sustainability among larger companies.  

Personally, I am not sure whether social businesses will tend to have more impact as independent businesses or as social subsidiaries of larger companies – and it may be impossible to generalize – but I will continue to watch future acquisitions and development in this area with interest. 

* My co-bloggers Joan Heminway and Marcia Narine may remember Michael Pirron from a Regent Law symposium they spoke at on social enterprise law. That was a fun conference and it was good to catch up with Micheal and hear how much his company has grown in the past year and a half. 

December 19, 2014 in Business Associations, Corporate Governance, Corporations, CSR, Haskell Murray, Social Enterprise | Permalink | Comments (2)

Friday, December 12, 2014

Challenge to Termination Fee Survives Motion to Dismiss

The Delaware Court of Chancery recently denied a motion to dismiss in In re Comverge, Inc. Shareholders Litigation. In this case, the plaintiff claimed bad faith by the board of directors that approved an allegedly unreasonable termination fee in a merger agreement. Transactional attorneys and professors who teach M&A will want to read this case.  

I am deep into grading my business associations exams, so I will outsource to a nice client alert on the case by Steven Haas at Hunton & Williams. A bit of the alert is below, and you can access the entire alert here.

The court then found that the termination fees of 5.55% of equity value (or 5.2% of enterprise value) during the go-shop period and 7% of equity value (or 6.6% enterprise value) after the go-shop period “test the limits of what this Court has found to be within a reasonable range for termination fees.” The court also analyzed the termination fee in connection with the convertible note held by the buyer in connection with the bridge financing. The plaintiff alleged that the conversion feature in the note, which allowed the buyer to purchase common stock at a price below the merger consideration, would significantly increase the cost to a topping bidder of acquiring the company. Factoring in that cost to the existing termination fee, the plaintiff argued, would result in a total payment equal to 11.6% of the deal’s equity value during the go-shop period and 13.1% of the deal’s equity value after the go-shop period.

The court concluded that, for purposes of surviving a motion to dismiss, it was “reasonably conceivable that the Convertible Notes theoretically could have worked in tandem with the termination fees effectively to prevent a topping bid” from a buyer that might otherwise offer greater value to the company’s stockholders. Perhaps more importantly, the court found that the plaintiff adequately alleged that the board of directors acted in bad faith in approving these terms....

Despite the amount of litigation challenging M&A transactions, there are not many Delaware rulings that have upheld challenges to deal protections such as termination fees, matching rights, and no-shop provisions. This is because the Delaware courts have generally created a body of precedent that provides helpful guidance to buyers and sellers and also recognized the value of such terms. In Comverge, the parties appear to have deviated from this precedent, but more importantly, the court looked to the bridge loan to view the aggregate effect of the various terms on the ability of a third party to make a topping bid. 

December 12, 2014 in Business Associations, Corporate Governance, Delaware, Haskell Murray, M&A | Permalink | Comments (0)

Friday, December 5, 2014

Data on Social Enterprises

An early, brief look at some of the social enterprise data I have been collecting with Kate Cooney (Yale School of Management), Justin Koushyar (Emory University, PHD student) and Matthew Lee (INSEAD, Singapore Campus), is up on the Stanford Social Innovation Review (SSIR)

The charts produced over at SSIR include the number of social enterprise statutes passed per year, total number of L3Cs and benefit corporations formed, and -- the most difficult data to track down -- the number of social enterprises formed by state.

We are still working to refine the state-by-state data, hope to continue to update it, and may use it for future empirical work. 

December 5, 2014 in Business Associations, Entrepreneurship, Haskell Murray, Social Enterprise | Permalink | Comments (0)

Law, Entrepreneurship, and Shark Tank

I watch a lot of Shark Tank episodes. Like most “reality shows,” Shark Tank is somewhat artificial. The show does not purport to be an accurate portrayal of how entrepreneurs typically raise capital, but I still think the show can be instructive. From time to time, mostly in my undergraduate classes, I show clips from the show that are available online.

Shark Tank
(creative commons image, no attribution requested)

After the break I share some of the lessons I think entrepreneurs (and lawyers advising entrepreneurs) can learn from Shark Tank. After this first list of lessons, I share a second list -- things folks should not take from the show. 

Continue reading

December 5, 2014 in Business Associations, Business School, Entrepreneurship, Haskell Murray, Law School, Television | Permalink | Comments (2)

Friday, November 28, 2014

Education and Aesthetics

Earlier this week, I watched Ivory Tower: Is College Worth the Cost? on CNN, which was a somewhat depressing documentary for someone who hopes to spend the next 30+ years in higher education.

One of the things the documentary decries is the construction of more and more extravagant buildings and amenities on college campuses.

While the extent and type of building that should occur can be reasonably debated – and my own institution has almost doubled the number of buildings on campus in the past decade – I want to make a relatively modest claim here: aesthetics matter in higher education.

Belmont University

(Photo of a Belmont University building and fountain from my iPhone).

Perhaps some schools have gone overboard in creating beautiful campuses. However, at institutions that exist to illuminate for students something much more important than mere financial returns, I think it is fitting to invest in beautiful campuses, for their own sake.

Again, perhaps most schools do not need student recreation centers than costs hundreds of millions of dollars, but there is something inspiring about going to a school, and teaching at a school, that is breathtakingly beautiful. 

This post may surprise some people who know me because I tend to be a pretty practical person, and I still believe that campus buildings should be functional over fancy, if you have to choose. But I think we need to widen the lens when we look at the benefits college and graduate school experiences provide. Yes, the financial benefits are quite important, and most schools need to be actively looking at increasing the financial benefits and/or reducing the financial costs.

Hopefully, however, college is about much more than just paying money now for an opportunity to earn more money later. Hopefully, college is about building relationships, learning independence, learning to think critically, being inspired, being mentored, creating and appreciating beauty. Maybe this is wishful thinking from a professor, but I do regularly see students who seem to capture much more from college than just better job prospects. Granted, many students do not take full advantage of the meaningful opportunities available, but those meaningful opportunities exist and they are hard to capture on a balance sheet.

I don’t know what a beautiful building is worth. I guess we could measure its worth by counting the number of additional students it attracts to the school, but that seems cynical and narrow. Beautiful buildings may inspire. Inspiration is tough to quantify, but, nonetheless, I think it has value. Personally, I am thankful I work on a beautiful campus, and hope the campus inspires our students not only while they study here, but after they leave as well.     

November 28, 2014 in Business School, Film, Haskell Murray, Law and Economics | Permalink | Comments (0)

Thursday, November 27, 2014

Can a socially responsible person shop on Thanksgiving or Black Friday?

As regular readers know, I research and write on business and human rights. For this reason, I really enjoyed the post about corporate citizenship on Thanksgiving by Ann Lipton, and Haskell Murray’s post about the social enterprise and strategic considerations behind a “values” message for Whole Foods, in contrast to the low price mantra for Wal-Mart. Both posts garnered a number of insightful comments.

As I write this on Thanksgiving Day, I’m working on a law review article, refining final exam questions, and meeting with students who have finals starting next week (being on campus is a great way to avoid holiday cooking, by the way). Fortunately, I gladly do all of this without complaint, but many workers are in stores setting up for “door-buster” sales that now start at Wal-Mart, JC Penney, Best Buy, and Toys R Us shortly after families clear the table on Thanksgiving, if not before. As Ann pointed out, a number of protestors have targeted these purportedly “anti-family” businesses and touted the “values” of those businesses that plan to stick to the now “normal” crack of dawn opening time on Friday (which of course requires workers to arrive in the middle of the night). The United Auto Workers plans to hold a series of protests at Wal-Mart in solidarity with the workers, and more are planned around the country.

I’m not sure what effect these protests will have on the bottom line, and I hope that someone does some good empirical research on this issue. On the one hand, boycotts can be a powerful motivator for firms to change behavior. Consumer boycotts have become an American tradition, dating back to the Boston Tea Party. But while boycotts can garner attention, my initial research reveals that most boycotts fail to have any noticeable impact for companies, although admittedly the negative media coverage that boycotts generate often makes it harder for a companies to control the messages they send out to the public. In order for boycotts to succeed there needs to be widespread support and consumers must be passionate about the issue.

In this age of “hashtag activism” or “slacktivism,” I’m not sure that a large number of people will sustain these boycotts. Furthermore, even when consumers vocalize their passion, it has not always translated to impact to lower revenue. For example, the CEO of Chick-Fil-A’s comments on gay marriage triggered a consumer boycott that opened up a platform to further political and social goals, although it did little to hurt the company’s bottom line and in fact led proponents of the CEO’s views to develop a campaign to counteract the boycott.

Similarly, I’m also not sure of the effect that socially responsible investors can have as it relates to these labor issues. In 2006, the Norwegian Pension Fund divested its $400 million position (over 14 million shares in the US and Mexico operations) in Wal-Mart. In fact, Wal-Mart constitutes two of the three companies excluded for “serious of systematic” human rights violations. Pension funds in Sweden and the Netherlands followed the Fund’s lead after determining that Wal-Mart had not done enough to change after meetings on its labor practices. In a similar decision, Portland has become the first major city to divest its Wal-Mart holdings. City Commissioner Steve Novick cited the company’s labor, wage and hour practices, and recent bribery scandal as significant factors in the decision. Yet, the allegations about Wal-Mart’s labor practices persist, notwithstanding a strong corporate social responsibility campaign to blunt the effects of the bad publicity. Perhaps more important to the Walton family, the company is doing just fine financially, trading near its 52-week high as of the time of this writing.

I will be thinking of these issues as I head to Geneva on Saturday for the third annual UN Forum on Business and Human Rights, which had over 1700 companies, NGOs, academics, state representatives, and civil society organizations in attendance last year. I am particularly interested in the sessions on the financial sector and human rights, where banking executives and others will discuss incorporation of the UN Guiding Principles on Business and Human Rights into the human rights policies of major banks, as well as the role of the socially responsible investing community. Another panel that I will attend with interest relates to the human rights impacts in supply chains. A group of large law firm partners and professors will also present on a proposal for an international tribunal to adjudicate business and human rights issues. I will blog about these panels and others that may be of interest to the business community next Thursday. Until then enjoy your holiday and if you participate in or see any protests, send me a picture.

November 27, 2014 in Ann Lipton, Conferences, Corporate Finance, Corporate Governance, Corporations, CSR, Current Affairs, Ethics, Financial Markets, Haskell Murray, International Business, Marcia Narine, Securities Regulation, Social Enterprise | Permalink | Comments (0)

Friday, November 21, 2014

Prices versus Process

PP

Whole Foods recently launched its first national advertising campaign around the theme “Values Matter.” Some outlets claim that the campaign is a response to weak comparable store sales. Supposedly, Whole Foods is spending between $15 million and $20 million on this campaign in an attempt to convince customers that “value and values go hand in hand.” You can see some of the videos here.

Whole Foods has long been known for its high prices and healthy food. Whole Foods has been actively fighting the high price reputation, but at least in the places I have lived, Whole Foods is usually close to the richest neighborhoods, is entirely absent in less affluent areas, and still seems to have higher prices than most competitors. Whole Foods seems to use a premium product, sold mostly to the upper-class, to fund its commitment to employees, its purchasing from smaller local vendors, and its care for the environment.

Whole Foods seems to focus on impacting society and the environment mostly through the process by which they sell their products and distribute the profits to stakeholders.

Walmart seems to have a very different model. Walmart seems to care much more about low prices than about treating their non-customer stakeholders well. Walmart’s extreme pressuring of suppliers, often contentious relationships with the communities around its stores, and low wages/limited benefits for many of its employees [updated] has been widely reported. Walmart seems to be trying to fight its reputation, and it has certainly engaged in some positive activities for society, but its reputation remains.

In contrast to Whole Foods, Walmarts can be found in rural and less affluent areas, and Super-Walmarts are bringing fresh produce to former food deserts at prices that appear to be more affordable. Walmart could argue that it makes a positive impact on society through its low prices.

In short, Whole Food’s strategy seems to be – proper process, high prices – while Walmart may allow a poor process to obtain low prices. 

Should corporate law, especially social enterprise law such as the recent benefit corporation law, encourage one strategy over the other?  The benefit corporation laws appear flexible enough to embrace either, though a more traditional understanding of social enterprise might exclude both on the ground that the companies’ primary purpose does not seem to be producing products that serve the disadvantaged. Social enterprise’s definition, however, has become much broader over time, though there is currently no consensus.    

This struggle with process and prices can be a difficult one, and I am just glad more companies are attempting to find appropriate solutions. 

November 21, 2014 in Business Associations, Current Affairs, Haskell Murray, Social Enterprise | Permalink | Comments (6)

Friday, November 14, 2014

Curiosity and Obedience

As a relatively new parent, I have been amazed at the insatiable curiosity of our son (19-months old). Like most parents, I think my son is special, but I see this curiosity in most children around his age. These young children want to investigate everything and will try anything. They make a lot of mistakes, but they are constantly learning and they seem to love learning.

Curiosity comes quite naturally. Obedience, however, needs to be taught. 

As a professor, I wish I could bottle my son’s curiosity and feed it to my students.

As a parent, I wish my young son obeyed as well as (most of) my students do. 

But I wonder, do we sometimes trade curiosity for obedience? Sir Ken Robinson has spoken about the problem of schools killing creativity. (Creativity and curiousity are related, I think). As a parent and as a professor, his talk is challenging.

If you are not prepared to be wrong you will never come up with anything original…we are now running national education systems where mistakes are the worst things you can make. We are educating people out of their creative capacities…Picasso once said this, he said that “all children are born artists; the challenge is to remain an artist as we grow up”…we don’t grow into creativity, we grow out of it, or rather we get educated out of it.   

Sir Ken Robinson's talk is somewhat depressing, because much of it rings true. His talk has been watched over 29 million times. Unfortunately, I couldn’t clearly identify his proposed solution. Maybe I need to dig into his more detailed work.

How do we teach discipline (which may be a better goal than mere obedience) without killing curiosity and creativity? I do not think discipline and curiosity are mutually exclusive, but they seem to be in tension a fair bit. As a parent, I am already terrified that my son will lose his curiosity. As a professor, I want to help my students recapture theirs.   

Any thoughts would be appreciated. 

November 14, 2014 in Business School, Haskell Murray, Law School, Teaching | Permalink | Comments (2)

Sunday, November 9, 2014

USC-Upstate, Southern Miss, and Truman State Positions

I have updated my list of legal studies professor openings with USC-Upstate, University of Southern Mississippi, and Truman State University. 

Details about those positions are available after the break.

Continue reading

November 9, 2014 in Business School, Haskell Murray, Jobs | Permalink | Comments (0)

Friday, November 7, 2014

A Few Law Listservs

 I subscribe to a few helpful law-related listservs:

All of these listservs provide useful information, through the helpful e-mails from the participants. Especially for those of us at business schools, where we do not have many legally trained colleagues, access to the collective wisdom of those on the listserv is invaluable. Occasionally, however, the listservs produce an avalanche of uninteresting e-mails. The LLC listserv allows the option of getting a single weekly digest of the discussion, which I prefer, though the Yahoo! formatting of the digest is unattractive and cumbersome.

What law-related listservs do you enjoy? Any thoughts on the best (free) platform for listservs?

November 7, 2014 in Business School, Haskell Murray, Law School, LLCs, Negotiation | Permalink | Comments (0)

Saturday, November 1, 2014

Two More Professor Postings

SFA                                   DePaul

I have updated my list of law professor positions at business schools with recent postings by Stephen F. Austin State University (legal studies) and DePaul University (ethics).

Details about both positions are available after the break.

Continue reading

November 1, 2014 in Business School, Ethics, Haskell Murray, Jobs | Permalink | Comments (0)

Friday, October 31, 2014

Two Law Review Exclusive Submission Windows

At least two law reviews currently have exclusive submission windows. See below for details.

Exclusive submission windows seem like a good idea, in general, and more law reviews seem to be using them recently. Most of the traditional peer reviewed journals already require exclusive submissions and it is nice to see some law reviews following along. The exclusivity requirement should cut down, substantially, on the number of submissions, allowing for a more thorough review. Exclusivity will also likely lead to some helpful self-selection because professors will not want to submit to a journal that is either too far above their target (unlikely to be accepted, which will delay their process) or below their target (may be accepted and they will be prevented from trading up). 

I still think more law journals should move to blind review, which these exclusive submission window announcements do not promise, but the fact that exclusive submission windows cut submissions to a manageble number is important as well. While law review websites usually say the editors review each submitted article carefully, I find that unlikely when some of those law reviews get 2,000 or more submissions. The editors don't even have time to read each abstract carefully. 

The promised information about the exclusive submission windows is below.

The University of Memphis Law Review:

The University of Memphis Law Review has 3 immediate openings for submissions for publication in issue 3 of this year's volume, which will be published in April 2015. The Editorial Board is looking for authors willing to submit exclusively to The University of Memphis Law Review in return for a guaranteed quick and thorough review and response (not later than four days after receipt). This expedited, exclusive review will be open until November 8, 2014.  Articles may be submitted after this date, however there is not guarantee of an expedited response and open slots will be filled on a first-come basis.

 

Please direct submissions to Nick Margello at lawreview_editorinchief@memphis.edu and include the subject line “Exclusive Review.” No specific topics are requested, but the Law Review seeks timely, relevant articles between 7,000-18,000 words in the text. The University of Memphis Law Review  has an excellent staff that works professionally with authors and consistently meets its own strict deadlines.  If you have an article looking for a placement, please consider sending it along. Thanks for your interest.

The Kentucky Law Journal (h/t Faculty Lounge):

The Kentucky Law Journal is opening an exclusive submission window for articles until November 14, 2014, at 5:00 PM EDT. All papers submitted during this window will be reviewed for publication in Volume 103, Issue 4, set for publication in Spring 2015. By submitting your article during this window, you agree to accept a publication offer, should one be extended. This window is available for articles on all topics, including articles previously submitted to the Kentucky Law Journal, though resubmission will be required. Submissions should be between 15,000 and 25,000 words with citations meeting the requirements of The Bluebook.

 

Submissions should be sent via email to chrisheld.klj@gmail.com. Please include your article, a copy of your C.V. and a short abstract or cover letter.

October 31, 2014 in Call for Papers, Haskell Murray, Law School | Permalink | Comments (0)