Business Law Prof Blog

Why I'm Having More Fun Teaching Business Associations Than Ever Before

I didn't really think it through. I actually thought that teaching Business Associations (BA) online, would mean that I would have fewer students. I'm teaching online because I have two immunocompromised parents and I don't want to take any risks. But alas, I have 90 students this semester.

Not to brag, but I'm pretty good at teaching online. I haves some students who have taken three or four classes with me online and none of them are required. But I have never taught ninety online. That number is completely contrary to best practices for online teaching and learning. 

I even tried to scare some students away. Before every semester, I ask all students to complete a Google form that helps me understand them a bit better. This lets me know how to pronounce their names, what experience they have in business, where they have worked, what classes they are taking, and what they are most interested in learning about. This survey helped me understand how many of them were taking BA and Evidence at the same time. Some masochists are taking BA, Evidence, and our Transactional Skills I course, which is incredibly time consuming. But alas, only two dropped.

I always count class participation and professionalism for 25% of the grade because I try to teach this class as a hybrid between skills and doctrinal. How do you do that with so many students? Here's what has helped so far. 

• Yes, the students do case briefs. But I require them to brief the case as though they were talking to a business person in plain English. As they prepare to brief the case and consider what facts to include, I ask them to consider why a business person would care if they will never see this same fact pattern again? What does the jargon mean? What are the key takeaways? I tell them that if they can't explain it to a lay person, then they don't truly understand it.
• I also allow them to have co-counsel if they can't answer a question. I give the person discussing the case the chance to answer my curveball questions first and if they can't, I ask for volunteers as "co-counsel." This helps others stay involved and it gives them the chance to shine as well. 
• The students now also explain the problem sets from the book that I used to go through with the class with me as the sage on the stage. The textbook I use is light on cases by design. In addition to reading cases, my students spend time looking at simplified agreements and answering questions about whether the parties involved can take certain actions based on the agreement and the relevant state statutes. It's painstaking sometimes, but it's more in line with what business lawyers will do. The more the students feel like they are doing "real work," the more engaged they are. Now they lead those discussions and I add more facts and steer them in the right direction when they don't get it. Statutory interpretation is hard for them, so I take the lead on that part. 
• Even if we went through every case and problem in the book, I still wouldn't be able to have all students speak so I've now added a current events component. Students have to pick an item in the news that relates to what we are covering that week or something we have already covered. This requires them to read the news and apply what they have learned. They can also use a scene from a show like Billions, Succession, or some other show or movie and explain what the writers got right and what they got wrong based on what they've learned in class. 
• I am also giving a midterm for the first time in a long time. Although the midterm will have multiple choice questions, I will have students look at past essay questions and issue spot for the class. I will do the same with past final exam questions when we do that review. When students "teach," they learn twice. 
• As one credit of this four-credit class, my students must watch videos and answer questions in the videos prior to class because I used a flipped classroom method. I do most of the videos myself and draft the multiple choice and short answer questions so I have a good idea of what students do and don't understand. At the end of most of the videos, there is a discussion board where students can post questions about topics that they still don't understand. Rather than answering the questions myself, I now offer the opportunity for other students to answer them on a Google sheet. This gives students the chance to earn additional class participation points, especially those who don't like to raise their hands in class. And it saves me a ton of time.
• Another thing that saves me time? For the second half of the semester, I use videos from HotShot, a company that provides training videos to law firms and law schools. HotShot has videos from practicing lawyers, short quizzes, and cheat sheets so the students can learn the information in a different way from someone else. It also gives the students a leg up on some of their peers when they do internships and post-graduation jobs.
• I also use breakout rooms for students to brainstorm as though they are advising a fictional business. Each week so far, I've been adding new facts to the fact pattern so the students can apply what they have learned. And every time they use legalese, I tell them I don't understand. It's very hard to visit 20 breakout rooms, so I jump around. I also encourage them to email me with the names of their peers who provide particularly helpful insights in these sessions. Students have sent me lovely notes about their peers and this also helps them get to know each other. Breakout rooms help build community with such a large class.
•  I also open the Zoom room 15 minutes before class for office hours. Some students come in just to hear what others say and sometimes we just sit there and talk about non-BA topics. I also hold office hours on weekends and at several times during the week so the students can build a relationship with me.
• I use the chat feature on Zoom a lot. Students answer a question of the day each class when they come in. Sometimes it relates to a case. Sometimes it relates to their other classes and what they are finding difficult. It's a nice way to get them engaged as soon as they enter the Zoom room. I also encourage them to use the chat during class. Some students raise their hands to answer questions before I even finish the sentence like it's Family Feud. Others are more comfortable answering the questions in the chat. Some are more comfortable asking questions in the chat. The chat feature is the great equalizer and I save them all. 
• As an AI enthusiast and GC to an AI startup, I am a huge proponent of teaching students how to use generative AI. Some future assignments will have students show up to class and I will simulate a partner asking them to draft a short email to a client answering a question from our fictional client. Some of the students will be able to use AI and some will not. Then the class will point out what legal principles the students who used AI missed or got incorrect. The first time they use the AI, I won't give them any guidance. Throughout the semester, I will show them the best ways to use prompts to arrive at a better answer. 
• Law students are often competitive. In the past, I have divided the students up into teams, and they have worked on projects as firms. As part of the final exam review, I do BA Jeopardy, where the teams answer multiple choice, short answer, and fill in the blank questions in a rapid fire style. If the team can't answer, I quickly move to the next team. And if they don't answer, then I answer. The team with the most points gets extra points toward their final grade. With ninety students, I will have students earn points as individuals. This will ensure that they are all prepared and have the chance to raise their grades in a fun way. 

How are you making teaching more fun for yourself and more impactful for your students?

 

Texas Tech Law Hiring - Business Law

The School of Law at Texas Tech University invites applications for a full-time, 9-month tenure-track Professor of Law position to begin in August of 2025.  The position is open to both entry-level candidates and candidates who are on the tenure-track or tenured at another school.  Candidates who satisfy Texas Tech University’s requirements to be hired with tenure will also be eligible to hold the Frank McDonald Endowed Professorship in business law.

Required Qualifications

In line with TTU’s strategic priorities to engage and empower a diverse student body, enable innovative research and creative activities, and transform lives and communities through outreach and engaged scholarship, applicants should have experience or demonstrated potential for working with diverse student populations at the undergraduate and/or graduate levels within individual or across the areas of teaching, research/creative activity, and service.

Specific required qualifications are:

1. Candidates should have a J.D.;
2. Candidates should have a demonstrated potential for excellence in research, teaching, and service; and
3. Candidates should have demonstrated potential for excellence in the areas of Contracts and in corporate/business law, such as Business Entities, Securities Regulation, Mergers & Acquisitions, and related courses.

Preferred Qualifications

In addition to the required qualifications, individuals with the following preferred qualifications are strongly encouraged to apply:  Experience teaching corporate/business law courses and scholarly publications in corporate/business law areas.

About the University and School of Law

Established in 1923, Texas Tech University is a Carnegie R1 (very high research activity) Doctoral/Research-Extensive, Hispanic Serving, and state-assisted institution. Located on a beautiful 1,850-acre campus in Lubbock, a city in West Texas with a growing metropolitan-area population of over 300,000, the university enrolls over 40,000 students with 33,000 undergraduate and 7,000 graduate students.  As the primary research institution in the western two-thirds of the state, Texas Tech University is home to 10 colleges, the Schools of Law and Veterinary Medicine, and the Graduate School.  The flagship of the Texas Tech University System, Texas Tech is dedicated to student success by preparing learners to be ethical leaders for a diverse and globally competitive workforce.  It is committed to enhancing the cultural and economic development of the state, nation, and world.

The School of Law has approximately 440 students and 38 full-time faculty members.  The School of Law is an integral part of the University and offers 10 dual-degree programs with other Texas Tech schools and colleges. The School of Law has a strong focus on students and is committed to a practical education to produce practice-ready graduates.

About Lubbock

Referred to as the “Hub City” because it serves as the educational, cultural, economic, and health care hub of the South Plains region, Lubbock boasts a diverse population and a strong connection to community, history, and land.  With a mild climate, highly rated public schools, and a low cost of living, Lubbock is a family-friendly community that is ranked as one of the best places to live in Texas.  Lubbock is home to a celebrated and ever-evolving music scene, a vibrant arts community, and is within driving distance of Dallas, Austin, Santa Fe, and other major metropolitan cities.  Lubbock’s Convention & Visitors Bureau provides a comprehensive overview of the Lubbock community and its resources, programs, events, and histories.

Equal Opportunity Statement

All qualified applicants will receive consideration for employment without regard to race, color, religion, sex, sexual orientation, gender identity, gender expression, national origin, age, disability, genetic information or status as a protected veteran.

To Apply for this Position

Please include the following documents in your application at the Texas Tech Jobs website  https://www.depts.ttu.edu/hr/workattexastech/

• Curriculum Vitae
• Cover Letter
• List of references

Questions about this position should be directed to Jarod Gonzalez, J. Hadley and Helen Edgar Professor of Law and Chair, Faculty Appointments Committee at [email protected]. For your application to be considered, you must submit it at the Texas Tech Jobs website. If you need assistance with the application process, contact Human Resources, Talent Acquisition at [email protected] or 806-742-3851.

Application Process

Submission of applications is preferred by September 16, 2024. To ensure full consideration, please complete an online application at https://www.depts.ttu.edu/hr/workattexastech/ Requisition # 38114BR.

The Value of Relationships in Business Lawyering

Transactions: The Tennessee Journal of Business Law recently published the proceedings of the 2023 Business Law Prof Blog symposium, held at UT Law in Knoxville back in October.  The proceedings can be found here.  As is customary, the issue includes articles written by the principal presenters—bloggers from here at the BLPB—and related commentary from UT Law faculty and students.

My contribution to the symposium was a piece called Business Lawyer Leadership: Valuing Relationships.  The abstract is set forth below.

Business lawyers are surrounded by relationships because of the nature of their work. Businesses are relational; business associations law is relational; business lawyering is relational. Business lawyering, in all its manifestations, is a practice steeped in the lawyer’s awareness and management of, as well as their participation in, the layered sets of relationships found in businesses and business associations law.

This article recognizes these important connections between business law practice and relationships. It approaches each of them in turn. The substantial take-away is that a business lawyer can best lead by understanding the inherent value of relationships to business lawyering and leveraging that understanding through focused effort that includes the employment of, among other things, relationship management skills. Relationship management—together with the other components of emotional intelligence and other relational traits, skills, and practices—affords business lawyers important tools for building and sustaining healthy relationships.

Those who know me well will recognize a lot of "me" in this piece.  Relationship building and relationship management are high priorities for me.  Through this article, I attempt to unravel some of the reasons why all business lawyers may want to place a premium on relationship building and management.  Relationships truly are deeply connected to business, business law, and business law practice in ways that make relational leadership skills valuable.

Teaching Transactional Business Law through Campus and Community Partnerships

At Emory Law's Eighth Biennial Conference on the Teaching of Transactional Skills back in the fall of 2023, I had the privilege of presenting with my UT Law clinical teaching colleague, Brian Krumm.  (Congratulations are due to Brian, who was recently appointed the Interim Director of our Clayton Center for Entrepreneurial Law!)  The title of this post is also the title of our presentation.  An edited transcript of the presentation was recently published by Transactions: The Tennessee Journal of Business Law and can be found here. The abstract is as follows:

In this edited transcript, we explain how each of us--a doctrinal law professor and a clinician--use members of our campus and local communities to help instruct transactional business law students. We each have independently realized that there is a value to sharing these outside business and legal experts with our students. Among other things, we have found that we can bring unique areas of legal and business expertise into our teaching and, at the same time, introduce our students to real-life practice experiences and related simulations. All of this is foundational to law practice. In addition, experiences of this kind are, in our view, increasingly useful and important as we look toward preparing students for the concepts, principles, and skills that will be tested on the NextGen Bar.

Please contact me or Brian if you have questions about the teaching we describe in this transcript.  We are happy to provide more information and relevant teaching materials.  Jyst ask.

A collection of the presentations from the Emory Law conference is available here.

Fiduciary Duties: A Tale of Two Families

Check out the third issue of volume 73 of the DePaul Law Review!  It includes a series of papers emanating from the HBO series Succession.  As you may recall, I posted a call for papers for this issue about a year ago.  Most of the papers in the issue came from a venture originated and organized by Susan Bandes and Diane Kemker called the Waystar Royco School of Law.  I wrote about that enterprise here.  

I participated in the Waystar Royco School of Law Zoom meetings as the “Roy/Demoulas Distinguished Professor of Law and Business.”  I presented on fiduciary duty issues comparing the principals of two family businesses--The Demoulas family from Northern Massachusetts and Succession's Roy family from New York.  You can find my Zoom session here (Passcode: #hN+7J5N).  That presentation resulted in an essay that I wrote for the DePaul Law Review issue as well as an advanced business associations course based on the Succession series. I finish teaching that course this week.  I also presented on the topic of my Succession essay at the Popular Culture Association conference back in March.  I include a screenshot of my cover slide below.

I just posted the essay to SSRN.  The piece is entitled What the Roys Should Learn from the Demoulas Family (But Probably Won’t).  The SSRN abstract is set forth below.

This essay offers a comparison of the actions taken by members of two families: the Demoulas family, best known as owner-operators of northeastern regional supermarkets, and the Roy family featured in HBO's series "Succession." The comparative appraisal focuses principally on the selfish pursuit of individualized financial, social, and familial status by key members of both the Demoulas and Roy families as they relate to the law of business associations (principally corporate law). At the heart of the matter is the legal concept of fiduciary duty. A comparison of the two families’ exploits reveals that lessons earlier learned by the Demoulas family (and observers of the multifaceted, multi-year litigation involving them and their business undertakings) fail to positively impact the destiny and legacy of Succession’s Roy family—at least as far as the Roy family story has been told to date. Although hope may be limited, there is still time for the remaining Roy family members to take heed and make changes.

To execute and comment on the comparison of these two families, the essay starts by outlining relevant information concerning legally recognized fiduciary duties in the corporate (and, to a lesser degree, partnership) contexts. Next, the essay offers background information about the Demoulas and Roy families and their respective businesses (both organized as corporations) and selected business dealings and governance, noting actual and potential breaches of fiduciary duty in each case. A brief conclusion offers comparative observations about the actions taken by members of the Demoulas and Roy families that contravene or challenge applicable fiduciary duties and the opportunity for general reflection. Of particular note is the observation that the ability of corporate directors and officers to comply with their fiduciary duties may become more difficult and complicated when integrating family dynamics and business succession issues into business decisions in a family business context.

I have enjoyed the research and teaching I have done in this area over the past year.  It always is nice to take a fresh approach to familiar concepts.  I daresay my students have felt the same way in covering business associations topics through the lens of the happenings in the series.  They certainly have been attentive and communicative, which is what I had been shooting for in teaching corporate and other business associations law through the course.  I am happy to answer questions about the course and provide my syllabi to anyone who wants to see what I assigned and did for the course.  Just ask.

Are Lawyers, Lawmakers, and Law Professors Really Ready for AI in 2024?

We just finished our second week of the semester and I’m already exhausted, partly because I just submitted the first draft of a law review article that’s 123 pages with over 600 footnotes on a future-proof framework for AI regulation to the University of Tennessee Journal of Business Law. I should have stuck with my original topic of legal ethics and AI.

But alas, who knew so much would happen in 2023? I certainly didn’t even though I spent the entire year speaking on AI to lawyers, businesspeople, and government officials. So, I decided to change my topic in late November as it became clearer that the EU would finally take action on the EU AI Act and that the Brussels effect would likely take hold requiring other governments and all the big players in the tech space to take notice and sharpen their own agendas.

But I’m one of the lucky ones because although I’m not a techie, I’m a former chief privacy officer, and spend a lot of time thinking about things like data protection and cybersecurity, especially as it relates to AI. And I recently assumed the role of GC of an AI startup. So, because I’m tech-adjacent, I’ve spent hours every day immersed in the legal and tech issues related to large and small language models, generative AI (GAI), artificial general intelligence (AGI), APIs, singularity, the Turing test, and the minutiae of potential regulation around the world. I’ve become so immersed that I actually toggled between listening to the outstanding Institute for Well-Being In Law virtual conference and the FTC’s 4-hour tech summit yesterday with founders, journalists, economists, and academics. Adding more fuel to the fire, just before the summit kicked off, the FTC announced an inquiry into the partnerships and investments of  Alphabet, Inc., Amazon.com, Inc., Anthropic PBC, Microsoft Corp., and OpenAI, Inc. Between that and the NY Times lawsuit against OpenAI and Microsoft alleging billions in damages for purported IP violations, we are living in interesting times.

If you’ve paid attention to the speeches at Davos, you know that it was all AI all the time. I follow statements from the tech leaders like other people follow their fantasy football stats or NCAA brackets. Many professors, CEOs, and general consumers, on the other hand, have been caught by surprise by the very rapid acceleration of the developments, particularly related to generative AI.

However, now more members of the general public are paying attention to the concept of deepfakes and demanding legislation in part because the supernova that is Taylor Swift has been victimized by someone creating fake pornographic images of her. We should be even more worried about the real and significant threat to the integrity of the fifty global elections and occurring in 2024 where members of the public may be duped into believing that political candidates have said things that they did not, such as President Biden telling people not to vote in the New Hampshire primary and to save their votes for November.

For those of us who teach in law schools in the US and who were either grading or recovering from grading in December, we learned a few days before Christmas that Lexis was rolling out its AI solution for 2Ls and 3Ls. Although I had planned to allow and even teach my students the basics of prompt engineering and using AI as a tool (and not a substitute for lawyering) in my business associations, contract drafting, and business and human rights class, now I have to also learn Lexis’ solution too. I feel for those professors who still ban the use of generative AI or aren’t equipped to teach students how to use it ethically and effectively.

Even so, I’m excited and my students are too. The legal profession is going to change dramatically over the next two years, and it’s our job as professors to prepare our students. Thompson Reuters, the ABA, and state courts have made it clear that we can’t sit by on the sidelines hoping that this fad will pass.

Professionally, I have used AI to redraft an employee handbook in my client’s voice (using my employment law knowledge, of course), prepare FAQs for another client’s code of conduct in a very specialized industry, prepare interview questions for my podcast, and draft fact patterns for simulations for conferences and in class. I’ve also tested its ability to draft NDAs and other simple agreements using only ChatGPT. It didn’t do so well there, but that’s because I know what I was looking for. And when I gave additional instructions, for example, about drafting a mutual indemnification clause and then a separate supercap, it did surprisingly well. But I know what should be in these agreements. The average layperson does not, something that concerns Chief Justice Roberts and should concern us all.

How have you changed your teaching with the advent of generative AI? If you’re already writing or teaching about AI or just want more resources, join the 159 law professors in a group founded by Professors April Dawson and Dan Linna. As for my law review article, I’m sure a lot of it will be obsolete by the time it’s published, but it should still be an interesting, if not terrifying, read for some.

Of Directorships: Reconfiguring the Theory of the Firm

It always is a great pleasure to pass along and promote the work of a colleague.  And today, I get to post about the work of a UT Law colleague!  Many of you know Tomer Stein, who came to join us at UT Law back in the summer.  He is such an ideal colleague and, like many of us, has broad interests across business finance and governance.

This post supports a recent draft governance piece, the title of which is the same as this post--Of Directorships: Reconfiguring the Theory of the Firm.  You can find the draft here.  The abstract is included below.

This Article develops a novel account of directorships and then uses it to reconfigure the theory of the firm. This widely accepted theory holds that firms emerge to satisfy the economic need for carrying out vertically integrated business activities under a fiduciary contract that substitutes for the owners’ multiple agreements with contractors and suppliers. As per this theory, the fiduciary contract is inherently incomplete, yet often preferable: while it cannot address all future contingencies in the firm, it will effectively direct all unaccounted-for firm events by placing them under the owners’ purview as a matter of default, or residual right. Under this contractual mechanism, firm owners, such as corporate shareholders, acquire the status of residual claimants who have the power to decide on all contractually unenumerated contingencies.

This view of the firm is conceptually flawed and normatively mistaken. Firms do carry vertically integrated business activities managed by their fiduciaries, but those fiduciaries—agents, trustees, and directors—are not functional equivalents from either the legal or economic standpoint. Unlike agents and trustees who receive commands from principals and settlors, respectively, directors manage the firm’s business by exercising decisional autonomy. Conceptually, shareholders who hire directors do not run the firm’s business as residual claimants. Rather, it is the directors who manage the firm as residual obligors—all contractually unaccounted for contingencies are placed under the fiduciary’s purview as a matter of obligation. This feature makes directorship an attractive management mechanism that often outperforms other fiduciary mechanisms, and the residual-claimant structure that stands behind them, in a broad variety of contexts. By developing this critical insight, the Article proposes not only to reconfigure the prevalent theory of the firm, but also to redesign both federal and state laws in a way that will facilitate directorships not only in corporations, but also across several indispensable dimensions of our financial, communal, and familial organizations.

As someone who understands both the central role of the director in corporate governance and the incomplete and inaccurate principal/agent relationship between shareholders and directors, I have enthusiasm for this project!  But I also am intrigued by the thought that the ideas in the paper can be translated to non-business institutions and groups.

Read on, and enjoy!

Governance, Finance, and HBO Max's Succession

The title of this post is the name of the advanced business associations law course I will teach in the spring.  I got the idea for this course after talking to students about decreasing enrollments in advanced business law courses.  Although they attributed much of the decrease to grade shopping, they also noted that they and their peers often base course registration decisions on course names (from which they make assumptions) without reading the course descriptions.  So, a course named "Advanced Business Associations," no matter how creatively it is taught (and I teach it as a discussion seminar), is not likely to attract positive attention.  When I floated using the HBO Max series Succession as a jumping off point for a discussion seminar on business law, they responded favorably.  The rest is, as they say, history. The proof of the pudding will be in the registration numbers.

The idea for the Succession-oriented course came to me quite naturally. I already was writing an essay on fiduciary duties relating to the series--forthcoming in the DePaul Law Review in a special volume focusing on Succession.  So, it was only a small jump to think about teaching more broadly from the many business law situations in the four seasons of the show.

Some of my friends from West Publishing heard about my teaching plans when they were visiting UT Law recently.  They mentioned the course to their colleague, Leslie Y. Garfield Tenzer, who produces a podcast for West Academic, Legal Tenzer: Casual Conversations on Noteworthy Legal Topics.  Leslie reached out and asked me to record an episode with her on the series and my course, which I recently did.  The podcast was released last week.  You can find it here.

My Succession course syllabus is still under construction.  If you have a favorite episode that you would like me to include--one that illustrates concepts from business governance or finance--let me know.  I admit that I am excited to teach from the material in Succession, a series that I enjoyed watching.

Connecting the Threads VII: This Coming Friday!

I am pleased to report that Connecting the Threads is back for another year--our seventh!  As readers will recall, this annual symposium features the work of your Business Law Prof Blog editors (sometimes with coauthors), with commentary from Tennessee Law faculty members and students.  Every year, my colleagues and I offer up a variety of presentation topics covering developing theory, policy, doctrine, pedagogy, and practice trends in various areas of business law.

This year’s panels include:

“Algorithms to Advocacy: How Emerging Technologies Impact Legal Practice and Ethics”
Marcia Narine Weldon

“The Road and Corporate Purpose”
William P. Murray and J. Haskell Murray

“Is the SEC Proposing a ‘Loaded Questions’ Climate Disclosure Regime?”
John P. Anderson

“Business Lawyer Leadership: Valuing Relationships”
Joan Heminway

“Metals Derivatives Markets and the Energy Transition”
Colleen Baker and James Coleman

If you are in the Knoxville area, please come join us on Friday for the day.  The program runs from 8:30 am (registration) to 3:00 pm.  Registration for CLE credit can be accessed here.

New York Law School Faculty Openings!

Full-Time Tenure Track Faculty Positions

New York Law School (NYLS), located in the heart of Tribeca, invites applications for full-time faculty tenure-track or lateral positions. Although we welcome applications from candidates in all fields, we are particularly interested in hearing from those who focus on business law (all areas), intellectual property law, technology and privacy law, and teaching basic first-year courses in torts and contracts. 

NYLS is deeply committed to fostering a diverse and inclusive community. We warmly welcome applications from any and all candidates whose background, lived experiences, and viewpoints will contribute to an exceptional learning environment. To view NYLS's Strategic Plan, visit www.nyls.edu/strategy, and for information on the School's commitment to diversity and inclusion, see www.nyls.edu/diversity.

Compensation

The salary range is from $150,000 to $210,000, expressed in annual terms.

How to Apply

Please submit a detailed curriculum vitae listing relevant legal practice and law school experience, a cover letter expressing your interest and describing your qualifications, and a list of references, to William P. LaPiana, Dean of Faculty, at [email protected].

New York Law School is an Equal Opportunity Employer

All qualified candidates will receive consideration for employment without regard to of race, color, religion, sex, sexual orientation, gender identity, gender expression, national or ethnic origin, age, disability, or veteran status, or any other characteristic protected by law.

New Paper: An LLC By Any Other Name Is Still Not A Corporation

It's been little while since I posted here, but long-time readers of theis blog will not be surprised by the topic.  I am happy to say that, after a lot of work with an exceptional co-author who shares my concerns, Professor Samantha Prince from Penn State Dickinson Law, we have an article documenting the problems with mislabeling LLCs and providing a variety of solutions.  I have been writing on this for nearly 15 years, and unfortunately, not a lot has changed. 

The article, An LLC By Any Other Name Is Still Not A Corporation, is now available on SSRN, here, and has been submitted for publication. In the meantime, we welcome thoughts and comments.  

Here is the abstract: 

Business entities have their own unique characteristics. Entrepreneurs and lawyers who represent them select an entity structure based on the business’s current and projected needs. The differing needs of each business span across myriad topics such as capital requirements, taxation, employee benefits, and personal liability protection. These choices present advantages and disadvantages many of which are built into the type of entity chosen.

It is critically important that people, especially lawyers, recognize the difference between entities such as corporations and limited liability companies (LLCs). It is an egregious, nearly unforgivable, error in our view to call an LLC a “limited liability corporation.” In part, this is because lawyers should try to get things right, but it is also because conflating the two entity types can lead to unpredictable outcomes. Perhaps more important, it could lead to incorrect and unjust outcomes. A prime example lies within the veil piercing context.

Lest you think that this is not a prevalent occurrence, there are nearly 9,000 references to the phrase “limited liability corporation” in court cases. Practicing attorneys are not the only people messing this up. Judges, legislators, federal and state agency officials, and media pundits are also getting it wrong. Most recently, Justice Samuel Alito scribed an op-ed that was published in the Wall Street Journal where he misused the term. Even the TV show Jeopardy! allowed as correct the answer, “What is a limited liability corporation?,” during one episode.

Enter artificial intelligence. AI relies on information it can find, and therefore AI generators, like ChatGPT, replicate the incorrect term. With a proliferation of users and programs using ChatGPT and other AI, the use of incorrect terminology will balloon and exacerbate the problem. Perhaps one day, AI can be used to correct this problem, but that cannot happen until there is widespread understanding of the distinct nature of LLCs and a commitment to precise language when talking about them.

This article informs of the looming harms of misidentifying and conflating LLCs with corporations. Additionally, it presents a warning together with ideas on how to assist with correcting the use of incorrect terminology in all contexts surrounding LLCs.

Quotables: Lipton & Edwards on TripAdvisor

Friend-of-the-BLPB Tom Rutledge alerted me earlier today to a Thomson Reuters piece on the TripAdvisor reincorporation litigation that quotes not one but two of our blogger colleagues: Ann Lipton and Ben Edwards (in that order).  Ann is quoted (after a mention and quotation of one of her recent, more entertaining tweets) on the Delaware judicial aspects of the case.  Ben is quoted on the Nevada corporate law piece.  So great to see these two offering their legal wisdom on this interesting claim.

Ann's tweet (perhaps predictably) offers a different "take" on Nevada law than Ben's press statements.

Ann: “I tell my students, Nevada is where you incorporate if you want to do frauds . . . .” 

Ben: “The folks here are people acting in good faith, trying to do what’s right – not cynically racing to the bottom . . . .”

And then Ben gets the last word: “Nevada . . . has become a home for billionaires leaving Delaware in a huff.”

Beautiful.

University of Washington Law is Seeking a Visiting Lecturer to Teach Business and Entrepreneurship Law-Related Courses

This just in from Mary Fan at the University of Washington School of Law:

The University of Washington School of Law invites applications for a visiting lecturer to teach courses in business law and entrepreneurship.  The University of Washington is a major research university in the dynamic hub of Seattle with numerous connections to innovative business and entrepreneurial activity.  Courses that the lecturer may teach include Business Organizations, Entrepreneurial Law, Law and Technology, Intellectual Property Survey, and Nonprofit Organizations. The successful candidate will have a track record of teaching and practical experience in these areas.  Please apply soon because applications are reviewed on a rolling basis.

More information and the application upload site is here:

https://apply.interfolio.com/122716.

Thanks to Mary for sharing this opportunity.

LSU Law is Seeking a Visitor or Adjunct for Business Associations Courses

This just in from friend-of-the-BLPB Christina Sautter:

The Louisiana State University Paul M. Hebert Law Center seeks visiting or adjunct professors for the 2023-2024 academic year to teach Business Associations I (fall and spring) and Business Associations II (spring).  Additional courses, such as Mergers & Acquisitions or Securities Regulation will also be considered. Interested individuals should email Pamela Hancock at [email protected] for more information, as well as to obtain a link and instructions for uploading a CV and cover letter.

LSU is committed to providing equal opportunity for all qualified persons in admission to, participation in, or employment in the programs and activities which the University operates without regard to race, creed, color, marital status, sexual orientation, gender identity, gender expression, religion, sex, national origin, age, mental or physical disability, or veteran's status. LSU is committed to diversity and is an equal opportunity/ equal access employer. LSU believes diversity, equity, and inclusion enrich the educational experience of our students, faculty, and staff, and are necessary to prepare all people to thrive personally and professionally in a global society.

Heminway on Fiduciary Duties and Succession - Tonight!!

As I noted in a post a few weeks ago, I am presenting on corporate fiduciary duties tonight as the Roy/Demoulas Distinguished Professor of Law and Business at the Waystar/ROYCO School of Law.  The title of my presentation is: What the Roys Should Learn from the Demoulas Family (But Probably Won't).  The presentation will run from 9:00 pm to 10:00 pm Eastern on Zoom at the following link:  https://us02web.zoom.us/j/86783560319?pwd=cTJza2N6elFyVGhBUFVjdk1Gb2oxQT09.

If you do not know about the Demoulas family and their fiduciary duty tangles up in Massachusetts, my presentation will inform you (and may even get you interested).  Members of the family were locked in litigation with each other for over 20 years.  Much of that litigation relates to alleged breaches of corporate and trust fiduciary duties.  And for those who have not watched the HBO Max series Succession, I will offer a window on some of the characters and plot lines, tying them in to observations about the Demoulas family.  

I welcome your attendance and participation!

Carney & Sharfman: Whither Judicial Valuation?

I teach a unit on the legal aspects of valuation in my Corporate Finance planning and drafting seminar every year.   I have often been able to secure as a guest speaker on one day during that unit a friend of mine who is a seasoned valuation expert (and was the expert whose opinion carried the day in the most recent Tennessee Supreme Court case on valuation in an M&A context).  

There is a relatively large body of academic literature on appraisal (a/k/a dissenters') rights and, more generally, the history of valuation law and practices in the M&A context.  In the Business Associations textbook of which I am a coauthor, I excerpt from Mary Siegel's 1995 article, Back to the Future: Appraisal Rights in the Twenty-First Century (32 Harv. J. on Legis. 79).  Her 2011 follow-on article, An Appraisal of the Model Business Corporation Act's Appraisal Rights Provisions (74 Law & Contemp. Probs 231 (2011)), also is a good read on appraisal rights history.  Other legal academics who have dipped their toes into these waters include George Geis, Bayless Manning, Brian JM Quinn, Randall Thomas, and Barry Wertheimer (who is no longer a law professor), and many more. 

I am excited to report that there is a new kid (really, two coauthor new kids) on the block.  Bill Carney has coauthored a new article on appraisal rights with Keith Sharfman entitled: The Exit Theory of Judicial Appraisal (28 Fordham J. Corp. & Fin. L 1 (2023)).  The SSRN abstract follows.

For many years, we and other commentators have observed the problem with allowing judges wide discretion to fashion appraisal awards to dissenting shareholders on the basis of widely divergent, expert valuation evidence submitted by the litigating parties. The results of this discretionary approach to valuation have been to make appraisal litigation less predictable and therefore more costly and likely. While this has been beneficial to professionals who profit from corporate valuation litigation, it has been harmful to shareholders, making deals costlier and less likely to complete.

In this Article, we propose to end the problem of discretionary judicial valuation by tracing the origins of the appraisal remedy and demonstrating that its true purpose has always been to protect the exit rights of minority shareholders when a cash exit is otherwise unavailable, and not to judge the value of the deal. So understood, judicial appraisal should not be a remedy for dissenting shareholders when a market exit or equivalent protection is otherwise available.

While such reform would be costly to valuation litigation professionals, their loss would be more than offset by the benefit of such reforms to shareholders involved in future corporate transactions. Shareholders presently have adequate protections, both from private arrangements and legal doctrines involving fiduciary duties.

I am grateful that Bill passed a copy of the article along to me yesterday.  This is a topic that generates significant interest in a variety of business law courses that I teach/have taught (including, in addition to Corporate Finance, Advanced Business Associations, Business Associations, and Mergers & Acquisitions).  Students love puzzling through the issues, asking, e.g.:

• Why do appraisal rights exist? 
• Why do we not see many reported appraisal rights opinions?
• How do planners and drafter address the existence of appraisal rights in practice?

Based on a quick peek at the table of contents of Bill's and Keith's article, I sense their work will offer the reader some answers to these and other related questions.

Can The Next Generation of Lawyers Save the World?

An ambitious question, yes, but it was the title of the presentation I gave at the Society for Socio-Economists Annual Meeting, which closed yesterday. Thanks to Stefan Padfield for inviting me.

In addition to teaching Business Associations to 1Ls this semester and running our Transactional Skills program, I'm also teaching Business and Human Rights. I had originally planned the class for 25 students, but now have 60 students enrolled, which is a testament to the interest in the topic. My pre-course surveys show that the students fall into two distinct camps. Most are interested in corporate law but didn't know even know there was a connection to human rights. The minority are human rights die hards who haven't even taken business associations (and may only learn about it for bar prep), but are curious about the combination of the two topics. I fell in love with this relatively new legal  field twelve years ago and it's my mission to ensure that future transactional lawyers have some exposure to it.

It's not just a feel-good way of looking at the world. Whether you love or hate ESG, business and human rights shows up in every factor and many firms have built practice areas around it. Just last week, the EU Corporate Sustainability Reporting Directive came into force. Like it or not, business lawyers must know something about human rights if they deal with any company that has or is part of a supply or value chain or has disclosure requirements. 

At the beginning of the semester, we discuss the role of the corporation in society. In many classes, we conduct simulations where students serve as board members, government officials, institutional investors, NGO leaders, consumers, and others who may or may not believe that the role of business is business. Every year, I also require the class to examine the top 10 business and human rights topics as determined by the Institute of Human Rights and Business (IHRB). In 2022, the top issues focused on climate change:

1. State Leadership-Placing people at the center of government strategies in confronting the climate crisis
2. Accountable Finance- Scaling up efforts to hold financial actors to their human rights and environmental responsibilities
3. Dissenting Voices- Ensuring developmental and environmental priorities do not silence land rights defenders and other critical voices
4. Critical Commodities- Addressing human rights risks in mining to meet clean energy needs
5. Purchasing Power- Using the leverage of renewable energy buyers to accelerate a just transition
6. Responsible Exits- Constructing rights-based approaches to buildings and infrastructure mitigation and resilience
7. Green Building- Building and construction industries must mitigate impacts while avoiding corruption, reducing inequality, preventing harm to communities, and providing economic opportunities
8. Agricultural Transitions- Decarbonising the agriculture sector is critical to maintaining a path toward limiting global warming to 1.5 degrees
9. Transforming Transport- The transport sector, including passenger and freight activity, remains largely carbon-based and currently accounts for approximately 23% total energy-related CO2 global greenhouse gas emissions
10. Circular Economy- Ensure “green economy” is creating sustainable jobs and protecting workers

The 2023 list departs from the traditional type of list and looks at the people who influence the decisionmakers in business. That's the basis of the title of this post and yesterday's presentation. The 2023 Top Ten are:

1. Strategic Enablers- Scrutinizing the role of management consultants in business decisions that harm communities and wider society. Many of our students work outside of the law as consultants or will work alongside consultants. With economic headwinds and recessionary fears dominating the headlines, companies and law firms are in full layoff season. What factors should advisors consider beyond financial ones, especially if the work force consists of primarily lower-paid, low-skilled labor, who may not be able to find new employment quickly? Or should financial considerations prevail?
2. Capital Providers- Holding investors to account for adverse impacts on people- More than 220 investors collectively representing US$30 trillion in assets under management  have signed a public statement acknowledging the importance of human rights impacts in investment and global prosperity. Many financial firms also abide by the Equator Principles, a benchmark that helps those involved in project finance to determine environmental and social impacts from financing. Our students will serve as counsel to banks,  financial firms, private equity, and venture capitalists. Many financial institutions traditionally focus on shareholder maximization but this could be an important step in changing that narrative. 
3. Legal Advisors- Establishing norms and responsible performance standards for lawyers and others who advise companies. ABA Model Rule 2.1 guides lawyers to have candid conversations that "may refer not only to law but to other considerations such as moral, economic, social and political factors, that may be relevant to the client's situation." Business and human rights falls squarely in that category. Additionally, the ABA endorsed the United Nations Guiding Principles on Business and Human Rights ten years ago and released model supply chain contractual clauses related to human rights in 2021. Last Fall, the International Bar Association's Annual Meeting had a whole track directed to business and human rights issues. Our students advise on sanctions, bribery, money laundering, labor relations, and a host of other issues that directly impact human rights. I'm glad to see this item on the Top 10 list. 
4. Risk Evaluators- Reforming the role of credit rating agencies and those who determine investment worthiness of states and companies. Our students may have heard of S&P, Moody's, & Fitch but may not know of the role those entities played in the 2008 financial crisis and the role they play now when looking at sovereign debt.  If the analysis from those entities  are flawed or laden with conflicts of interest or lack of accountability, those ratings can indirectly impact the government's ability to provide goods and services for the most vulnerable citizens.
5. Systems Builders- Embedding human rights considerations in all stages of computer technology. If our students work in house or for governments, how can they advise tech companies working with AI, surveillance, social media, search engines and the spread of (mis)nformation? What ethical responsibilities do tech companies have and how can lawyers help them wrestle with these difficult issues?
6. City Shapers-  Strengthening accountability and transformation in real estate finance and construction. Real estate constitutes 60% of global assets. Our students need to learn about green finance, infrastructure spending, and affordable housing and to speak up when there could be human rights impacts in the projects they are advising on. 
7. Public Persuaders- Upholding standards so that advertising and PR companies do not undermine human rights. There are several legal issues related to advertising and marketing. Our students can also play a role in advising companies, in accordance with ethical rule 2.1, about persuaders presenting human rights issues and portraying controversial topics related to gender, race, indigenous peoples, climate change in a respectful and honest manner. 
8. Corporate Givers- Aligning philanthropic priorities with international standards and the realities of the most vulnerable. Many large philanthropists look at charitable giving as investments (which they are) and as a way to tackle intractable social problems. Our students can add a human rights perspective as advisors, counsel, and board members to ensure that organizations give to lesser known organizations that help some of the forgotten members of society. Additionally, Michael Porter and Mark Kramer note that a shared-value approach, "generat[es] economic value in a way that also produces value for society by addressing its challenges. A shared value approach reconnects company success with social progress. Firms can do this in three distinct ways: by reconceiving products and markets, redefining productivity in the value chain, and building supportive industry clusters at the company's locations." Lawyers can and should play a role in this. 
9. Business Educators- Mainstreaming human rights due diligence into management, legal, and other areas of academic training. Our readers teaching in business and law schools and focusing on ESG can discuss business and human rights under any of the ESG factors. If you don't know where to start, the ILO has begun signing MOUs with business schools around the world to increase the inclusion of labor rights in business school curricula. If you're worried that it's too touchy feely to discuss or that these topics put you in the middle of the ESG/anti-woke debate, remember that many of these issues relate directly to enterprise risk management- a more palatable topic for most business and legal leaders. 
10. Information Disseminators- Ensuring that journalists, media, and social media uphold truth and public interest. A couple of years ago, "fake news" was on the Top 10 and with all that's going on in the world with lack of trust in the media and political institutions, lawyers can play a role in representing reporters and media outlets. Similarly, lawyers can explain the news objectively and help serve as fact checkers when appearing in news outlets.

If you've made it to the end of this post, you're either nodding in agreement or shaking your head violently in disagreement. I expect many of my students will feel the same, and I encourage that disagreement. But it's my job to expose students to these issues. As they learn about ESG from me and the press, it's critical that they disagree armed with information from all sides.

So can the next generation of lawyers save the world? Absolutely yes, if they choose to. 

Zhaoy Li Compares the U.S. and China on Judicial Review of Directors' Duty of Care

Zhaoyi Li, Visiting Assistant Profoessor of Law at the Univeristy of Pittsburgh School of Law, has published a new article, Judicial Review of DIrectors' Duty of Care: A Comparison Between U.S. & China. Here's the abstract:

Articles 147 and 148 of the Company Law of the People’s Republic of China (“Chinese Company Law”) establish that directors owe a duty of care to their companies. However, both of these provisions fail to explain the role of judicial review in enforcing directors’ duty of care. The duty of care is a well-trodden territory in the United States, where directors’ liability is predicated on specific standards. The current American standard, adopted by many states, requires directors to “discharge their duties with the care that a person in a like position would reasonably believe appropriate under similar circumstances.” However, both the business judgment rule and Delaware General Corporate Law (“DGCL”) Section 102(b)(7) shield directors from responsibility for their actions, which may weaken the impact of the duty of care requirement on directors’ behavior.

To better allocate the responsibility for directors’ violations of the duty of care and promote the corporations’ development, it is essential that Chinese company law establish a unified standard of review governing the duty of care owed by directors to companies. The majority of Chinese legal scholars agreed that a combination of subjective and objective standards would function best. Questions remain regarding how to combine such standards and implement them. In order to promote the development of China’s duty of care, these controversial issues need to be solved. This article argues that China’s Company Law should hold a first-time violator of the duty of care liable only in cases of gross negligence but hold directors liable in the cases of ordinary negligence if they have violated the duty of care in the past.

 

How Generation, Nationality, and Expertise Influence Stakeholder Prioritization of Tech Social Issues- Pt. 2

Last month, I posted about an experiment I conducted with students and international lawyers. I’ve asked my law student, Kaitlyn Jauregui to draft this post summarizing the groups’ reasoning and provide her insights. Next week, I’ll provide mine in light of what I’m hearing at various conferences, including this week’s International Bar Association meeting. This post is in her words.

After watching The Social Dilemma, participants completed a group exercise by deciding which social issues were a priority in the eyes of different tech industry stakeholders. The Social Dilemma is a 2020 docudrama that exposes how social media controls that influences the behavior, mental health, and political views of users by subjecting them to various algorithms. Director Jeff Orlowski interviewed founding and past tech employees of some of the biggest companies in Silicon Valley to bring awareness to viewers.  

Groups of primarily American college students, primarily American law students, one group of Latin American lawyers, and one group of international lawyers completed the exercise. Each of the groups deliberated from the perspective of a CEO, investor, consumer, or NGO.  Acting as that stakeholder, the team then ranked the following issues in order of importance: Incitements to violence, Labor Issues, Suppression of Speech, Mental Health, Surveillance, and Fake News. 

How The Groups Performed

The college students attend an American law school, but they are not necessarily all American. The groups’ logic behind their rankings could not be provided. I provided the rankings in the last post.

Law Students

The law students attend and American law school, but they are not necessarily all American. They considered six social issues.

Team CEO: Law Students

1.    Labor Issues in the Supply Chain

2.    Surveillance

3.    Mental Health

4.    Fake News

5.    Suppression of Speech

6.    Incitements to Violence

The law students assigned to view the issues as a CEO based their rankings on an internal to external approach. They believed the CEO is responsible for the operations of the company so would first try to solve internal issues such as labor issues because that would directly affect the bottom line. Surveillance and mental health ranked #2 because the team assumed that these issues directly related to customer satisfaction and retention. Because this group took on the role as a tech CEO and not a social media CEO, they did not view 4-6 as important. Fake news was only relevant if it was about the company. Suppression of speech was not problematic to them because it would not directly impact their business. Finally, they did not view incitement to violence as relevant to the business operations so ranked it last.

Team Investor: Law Students

1.    Labor Issues in the Supply Chain

2.    Incitements to Violence

3.    Surveillance

4.    Suppression of Speech

5.    Fake News

6.    Mental Health

The law students who prioritized social issues as if they were an Investor approached the task considering market forces. They chose labor issues first because it poses challenges to business operations. Whatever looks bad for revenue generation such as incitement to violence and surveillance means their investment would look bad as well. It is important to note they viewed this assignment as an institutional investor. The remaining factors were not imperative to the success of the tech company so were ranked lower.

Team NGO: Law Students

1.    Fake News

2.    Incitement to Violence

3.    Mental Health

4.    Labor Issues in Supply Chain

5.    Surveillance

6.    Suppression of Speech

The law students who took on a role as an NGO based their sense of urgency on the danger and risks the involved in each issue. At the top was fake news because they thought misinformation when taken as fact was unhealthy for making decisions and forming opinions. Incitement to violence closely followed because political polarization can lead to hateful actions outside of social media. They found mental health to be important because of statistics showing teens committing self-harm or worse as a result of social media use. Although labor Issues are abroad, the NGO team could not ignore it. Surveillance was not key to them because they believed platforms are already taking measures against it. And lastly, suppression of speech was not as important to them as deleting hate speech and fake news.

Team Consumer: Law Students

1.    Surveillance

2.    Mental Health

3.    Incitement to Violence

4.    Suppression of Speech

5.    Fake News

6.    Labor Issues in Supply Chain

The law students who took on their natural roles as consumers found social issues more important than financial forces. They referred to the many advertisements that tech companies like Apple and Google are posting against surveillance. The effects of social media on mental health and even physical health also stood out to them. As a group of law students, they are informed individuals who can spot fake news so did not see that as a priority. Lastly, labor issues are not in the consumers’ sight so are out of mind and therefore not a priority.

Latin American Lawyers

*The Latin American Lawyers did not consider Fake News or Incitements to Violence.

Team CEO: Latin American Lawyers

1.    Labor Issues in the Supply Chain

2.    Surveillance

3.    Suppression of Speech

4.    Mental Health

5.    -

6.    -

The Latin American lawyers ranked the social issues regarding business success and long-term goals. Labor issues were their top concern because it influences the legal challenges faced by the company and the costs of production. “Information is power” so surveillance restrictions would greatly decrease money earned from selling data gathered. They did not see suppression of speech as an issue because the company itself is not limited. Mental health was ultimately last because it does not impair business operations.

Team Investor: Latin American Lawyers

1.    Mental Health

2.    Surveillance

3.    Labor Issues in the Supply Chain

4.    Suppression of Speech

5.    -

6.    -

The Latin American lawyers listed their priorities as a socially responsible Investor. Mental health triggered the most urgency for them because the negative influence of social media on users is growing and is not slowing down. Heavy surveillance conflicts with the rights of persons like themselves so it is a great risk for them. Although labor issues were important, they did not think of it as a widespread issue affecting large populations of people. Lastly, suppression of speech was not a concern at all for them.

Team NGO: Latin American Lawyers

1.    Surveillance

2.    Suppression of Speech / Fake News

3.    Mental Health

4.    Labor Issues in Supply Chain

5.    -

6.    -

The Latin American lawyers who participated as an NGO focused their efforts on user experience and rights. They found surveillance to be a growing concern and a human right violation for users. Suppression of speech was also very important to them, especially in the scope of the team’s nationality because of political distress in their home countries. For countries with political instability, their citizens are more conscious of infringed rights through social media. Fake news and censorship on virtual platforms can ultimately destroy the democracy of countries in their point of view. The team preferred life over work so chose to rank mental health higher than labor issues.

Team Consumer: Latin American Lawyers

1.    Surveillance

2.    Suppression of Speech / Fake News

3.    Mental Health

4.    Labor Issues in Supply Chain

5.    -

6.    -

The Latin American lawyers used their personal perspective as consumers to rank in accordance with social concerns. Surveillance was seen as a major problem because it makes users uncomfortable knowing that their activity is tracked and sold as data. Suppression of speech was grouped with fake news as an important issue regarding the rights and freedom of the consumers. The gatekeeping of information from mainstream media in general was a concern for these consumers because they feel as if they are being controlled and concealed from the truth. Although the negative mental health results on teens from social media is important, the consumers thought this was the responsibility of parents and not of other consumers. Labor issues were of no concern because the consumers felt as if they have no control over the matter. 

International Lawyers

The International Group comprised of participants from Bolivia, Brazil, Bulgaria, Canada, Colombia, Ecuador, Egypt, Ethiopia, India, Iran, Jamaica, Mexico, Nepal, Sweden, Switzerland, and Ukraine. The group was not assigned to rank Mental Health as a social issue. The groups’ logic behind their rankings could not be provided.

Team CEO: International Lawyers

1.    Fake News

2.    Labor Issues in the Supply Chain

3.    Surveillance

4.    Incitement to Violence

5.    Suppression of Speech

6.    -

Team Investor: International Lawyers (Socially Responsible)

1.    Incitement to Violence

2.    Fake News

3.    Labor Issues in the Supply Chain

4.    Surveillance

5.    Suppression of Speech

6.    -

Team Investor: International Lawyers (Institutional)

1.    Labor Issues in the Supply Chain

2.    Incitements to Violence

3.    Suppression of Speech

4.    Fake News

5.    Surveillance

6.    -

Team NGO: International Lawyers

1.    Fake News

2.    Labor Issues in Supply Chain

3.    Suppression of Speech

4.    Incitements to Violence

5.    Surveillance

6.    -

 

Team Consumer: International Lawyers

1.    Incitements to Violence

2.    Suppression of Speech

3.    Fake News

4.    Labor Issues in Supply Chain

5.    Surveillance

6.    -

 Insights

When given a business or financial oriented role, the teams ranked the social issues by focusing on whether it impacts company performance. Teams with community or advocate roles tended to rank the social issues according to impact on society. Team CEO prioritized labor issues and surveillance the most. Labor issues along with incitements to violence were of top concern for Team Investor. Fake news was the number one issue for Team NGO. Team Consumer, which reflects the average personal view of the participants, believed incitements to violence and surveillance were the most pressing social issues in the tech industry. Labor issues were the least important to the consumer participants, which is interesting in scope of consumer purchase decisions overall and not just in tech.

The Team Consumer data is reflective of each of the groups’ personal beliefs because all participants are also consumers. The College Students prioritized mental health. Both the law students and the Latin American lawyers found surveillance the most important tech issue. International lawyers instead thought incitement to violence more pressing. A possible explanation is that people in the U.S. and Latin America are trying to protect their privacy from intrusive technology. Because the international lawyers had participants from countries where incitement to violence are occurring, that may be why it was important to them.

Suppression of speech closely followed for Latin American Lawyers and International Lawyers whereas Mental Health was the second priority for the primarily American law Students. Many citizens of countries around the globe face oppressive governments that censor speech which may be influential in why Suppression of Speech was ranked highly. In the United States, citizens are guaranteed freedom of speech and press which is why this issue may not be as concerning for them. American teens also suffer from more mental illness as a result of social media use, possibly why it is second place.

Practices in corporate culture and opinions on social issues are influenced by the ethnic makeup of the employees. Although the stakeholder roles the groups took are the most determinative factor, their nationality is naturally a bias in their decision-making.

The Lewis Model is a triangular spectrum that identifies the prominent features of different cultures. Richard Lewis spoke 10 languages, visited 135 countries, and work in over 20 of them to find observable variability in social behavior. He recognized that stereotypes are unfair, but also emphasized that social norms are standards in each country. There are three defined points of culture: Linear Active, Multi-active, and Reactive.

• Linear actives — those who plan, arrange, organize, do one thing at a time, follow action chains. They are truthful rather than diplomatic and do not fear confrontation. Their work and as well as personal life is based on logic rather than emotions. Linear actives like facts, fixed agenda and they are very job oriented. They are able to separate social-private and professional life.

• Multi-actives — people belonging to this cultural category are able to do many things at once, planning their priorities not according to a time schedule, but according to the relative thrill or importance that each appointment brings with it. These cultures are very talkative and impulsive. These characteristics predict their orientation on people. They feel uncomfortable in silence. Multi-active people prefer face to face sessions.

• Reactives — member of this group has in the priority list courtesy and respect on the top. This group is best listening culture. Listening quietly, reacting calmly and carefully to the other side's proposals are their traits as well. Reactive cultures are the world’s best listeners in as much as they concentrate on what the speaker is saying, do not interrupt a speaker while the discourse or presentation is on-going. Reactive people have large reserves of energy. Reactives tend to use names less frequently than other cultural categories.

How does the Lewis Model explain the results?

The primarily American college and law students fall under linear-active with their priorities aligned with individual rights and performance.

The Latin American lawyers are multi-active, think about the social issues in terms of impact on the community and on building relationships.

The International lawyers are comprised of participants all over the world, bringing in aspects from all over the spectrum.

The Lewis Model most likely plays a part in how each participant individually arrived at their own rankings and how they then communicated to agree on a reflective ranking together. The conversations guiding to the final result would have probably shown more insight as to how and why these social issues are important.

Age

The age of the participants is another influential factors because of the generational variation in trust in surveilling technologies. Generation Z, Millennials, and Generation X+ were asked in a survey how comfortable they felt with programs like Alexa or Siri on a scale from 1 to 10, 1 being very and 10 being not.

Generation Z: 7.73

Millennials: 8.28

Generation X+: 8.90

Older generations are more uneasy about virtual assistant technology.

With age comes more experience and better foresight. Researchers in Texas found that “older adults use the experience in decision-making accumulated over their lifetime to determine the long-term utility and not just the immediate benefit before making a choice. However, younger adults tend to focus their decision-making on instant gratification.”

How does age explain the results?

The majority of the college and law students were Generation Z or Millennials whereas the practicing attorneys were mostly Millennials or more senior.

As generations progress, younger people are more comfortable with surveillance technology than older people.

Expertise

Expertise of the participants surely impacted how they ranked social issues. The knowledge of experts in comparison to novices gives them a wider and practical approach to business and social issues. Here are some key aspects:

1. Experts notice features and meaningful patterns of information that are not noticed by novices.
2. Experts have acquired a great deal of content knowledge that is organized in ways that reflect a deep understanding of their subject matter.
3. Experts’ knowledge cannot be reduced to sets of isolated facts or propositions but, instead, reflects contexts of applicability: that is, the knowledge is “conditionalized” on a set of circumstances.
4. Experts are able to flexibly retrieve important aspects of their knowledge with little attentional effort.
5. Though experts know their disciplines thoroughly, this does not guarantee that they are able to teach others.
6. Experts have varying levels of flexibility in their approach to new situations.

Perhaps the practicing attorneys foresaw further down the line as to why one social issue was more pressing than another.

Thank you, Kaitlyn for providing your analysis of the results. Next week, I’ll provide mine.

Launching Business Associations 2022 - Course Objectives

I am back in the classroom teaching Business Associations (year 23 of teaching) on Wednesday.  As I was reviewing my course objective for the course this year, I wondered how different my learning objectives for my students are from those of others.  So, I decided I would share mine here and ask for comments.  Here it is:

*          *          *

Course objective:  The doctrinal content of this course is calibrated to prepare you for the business associations portion of the bar exam.  More specifically, the course is designed to enable you to:

• compare and contrast core legal rules relating to the existence, structure, governance, liability, and financing of basic forms of for-profit business entity (and distinguish these forms of entity from sole proprietorships governed by common law principles, including those found in agency law, as well as contract, tort, and property law) through the review and analysis of state statutory and decisional law;
• become familiar with basic concepts addressed in U.S. federal securities regulation, including the definition of a security, the registration of securities offerings, public company registration and reporting, proxy regulation, and securities fraud;
• understand the framework of business entity regulation and key business law tools, concepts, and principles at the intersection of theory, policy, doctrine, and practice;
• observe how economic, social, and political dynamics impact and are impacted by the law governing for-profit businesses; and
• apply, both in writing and through oral expression, basic principles of state business entity law and U.S. federal securities law through legal analysis in advocacy, transactional, and other legal advisory settings.

In this course, you are required to act as legal decision-makers, advocates, and advisors—both individually and as part of a group—and your performance will be assessed both individually and in a group context (with all members of the group being collectively responsible for the group’s performance, as lawyers are in law practice).  As a result, oral and written skills of various kinds (reading and listening closely and critically, analyzing methodically, persuading effectively and efficiently, self-assessing and peer assessing constructively, etc.) will be at a premium in all that we do.  Group dynamics also will play a role.  As the course permits, we will engage in contextual discussions about these kinds of skills and other aspects of lawyering (including legal ethics and professional responsibility, which pervade the course material).

*           *          *

I suspect that those of us who teach the course all have a core set of substantially similar objectives,  However, I also suspect that there is a lot of variance beyond that as to the scope of doctrine (how far beyond bar exam basics one goes) and the nature of other expectations.  Let me know in the comments or by private message if you have any comments or other reactions.  I remain curious . . . .