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Steve Bainbridge
Interests: Law, corporate governance, economics, politics, religion, education, books, food, and wine
Recent Activity
"Corporate Directors in the United Kingdom" by @ProfBainbridge @UCLA - https://t.co/6kYjR4KISb #corpgov #directors #UK — OBLB (@OxfordBLB) March 24, 2017 Continue reading
Posted 1 hour ago at ProfessorBainbridge.com
A new article by Kelvin Low addresses the titular debate: Of all the duties a law student encounters in the study of law, few will prove as bewildering as fiduciary duties. Whilst their core is supposed to be “relatively clear”,1 the wider content of fiduciary obligations continue to elude us. Whilst we know that fiduciaries are expected to avoid unauthorised profits and conflicts of interests, whether any fiduciary duties exist beyond this core remains controversial. Beyond a few established categories of fiduciary relationships such as trustee and beneficiary, 2 director and company,3 agent and principal,4 partners, 5 and solicitor and... Continue reading
Posted 1 hour ago at ProfessorBainbridge.com
From the Washington Legal Foundation: On March 24, 2017, WLF filed formal comments with the U.S. Securities and Exchange Commission in response to acting Chairman Michael S. Piwowar’s request for input on the implementation of the Pay-Ratio Disclosure Rule. SEC adopted the rule in August 2015, as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. In the interest of ensuring that SEC focuses on the integrity of financial markets, WLF maintained that SEC should avoid enforcing regulations that have no relation to the agency’s purpose. WLF also cautioned that the agency must carefully consider First Amendment protections... Continue reading
Posted 1 hour ago at ProfessorBainbridge.com
The Becket Fund has an update on an important trio of religious liberty cases pending before the Supreme Court: Advocate Healthcare Newtork v. Stapleton St. Peter’s Healthcare v. Kaplan Dignity Health v. Rollins Status: U.S. Supreme Court granted review, to hear case Spring 2017 Faith-based hospitals draw inspiration from their religious heritage. Driven by their faith to provide compassionate care, these hospitals treat people of all faiths and backgrounds, and their wellness services go beyond just providing medical care. For example, Saint Peter’s Family Health Center also serves juvenile victims of abuse, economically disadvantaged families and mentally disabled or violence-prone... Continue reading
Posted 1 hour ago at ProfessorBainbridge.com
Obviously, collusion with a foreign power is serious misconduct and, if it happened, should be punished. (<sarcasm>After all, only our CIA is allowed to interfere in foreign elections!</sarcasm>) But the fact remains that millions of people voted for someone other than Hillary because she was a lousy candidate with bad ideas--not because of anything Russia did. And what the left is doing here is yet another example of how they seek to demonize and delegitimize those people. They're trying to add Russian stooges to the list of everything else that makes those millions the "deplorables." (For context, go back and... Continue reading
Posted 2 days ago at ProfessorBainbridge.com
Mark Pulliam has a thoughtful review of Stephen presser's interesting new book that uses a series of biographical sketches of law professors (some of whom want on to bigger and better things, such as Barack Obama) to muse about the evolution of American legal thought: Law Professors is an exceptionally fine book—written in a sprightly style, well-illustrated, logically organized, and containing (as befits a scholarly tome) a detailed index. Displaying an easy but encyclopedic mastery of legal history, Presser covers American law from its English common law roots to the present, using as his pedagogical tool chapter-length sketches of influential... Continue reading
Posted 5 days ago at ProfessorBainbridge.com
I'm seeing a lot of empirical studies these days that purport to find positive correlations between corporate performance (variously measured) and progressive approved corporate "social responsibility" measures (diversity, sustainability, etc....). It's well known, of course, that it's hard to publish studies that find no result. But I wonder to whether there isn't a political bias here. Given the substantial tilt to the left in academia, one suspects that a lot of these number crunchers go into the problem with a preconceived notion of the "right" result and mine their data until they find one. One also suspects that editors of... Continue reading
Posted 5 days ago at ProfessorBainbridge.com
A recent CLS blog post by Martijn Cremers, Saura Masconale and Simone M. Sepe illustrates a recurring problem with empirical legal scholarship: First, it can only provide answers if the question involves something you can count. Second, how you count that something maters a lot. In the past 20 years, many corporate law scholars have come to the view that governance arrangements protecting incumbents from removal are what really matter for firm value, arguing that such arrangements help entrench managers and harm shareholders. A major factor supporting this view has been the rise of empirical studies using corporate governance indices... Continue reading
Posted 5 days ago at ProfessorBainbridge.com
Keith Paul Bishop notes a proposed amendment to the DGCL on how written consents are handled. In a later post, he elaborates his argument that the proposal does not save the basic problem. Continue reading
Posted 5 days ago at ProfessorBainbridge.com
Joshua Fershee reports on yet another case in which a court treats an LLC as a corporation for veil piercing purposes: The case is ACKISON SURVEYING, LLC, Plaintiff, v. FOCUS FIBER SOLUTIONS, LLC, et al., Defendants., No. 2:15-CV-2044, 2017 WL 958620, at *1 (S.D. Ohio Mar. 13, 2017). Here are the parties: the defendant is FTE Networks, Inc. (FTE), which filed a motion to dismiss claiming a failure to state a claim. FTE is the parent company of another defendant, Focus Fiber Solutions, LLC (Focus). The plaintiff, Ackison Surveying, LLC (Ackison) filed a number of claims against Focus, added an... Continue reading
Posted 7 days ago at ProfessorBainbridge.com
I have posted to SSRN a new paper, Corporate Directors in the United Kingdom (March 17, 2017). UCLA School of Law, Law-Econ Research Paper No. 17-04. Available at SSRN: https://ssrn.com/abstract=2935388 In the United States, state corporation law uniformly provides that only natural persons may serve as directors of corporations. Corporations, limited liability companies, and other entities otherwise recognized in the law as legal persons are prohibited from so serving. In contrast, the United Kingdom allowed legal entities to serve as directors of a company. In 2015, however, legislation came into force adopting a general prohibition of these so-called corporate directors,... Continue reading
Posted 7 days ago at ProfessorBainbridge.com
I recently presented my paper, Interest Group Analysis of Delaware Law: The Corporate Opportunity Doctrine as Case Study (available at SSRN: https://ssrn.com/abstract=2894577 ), at BYU's law school. Here's the slide deck for the presentation: Interest group analysis of Delaware law from Stephen Bainbridge Continue reading
Posted Mar 16, 2017 at ProfessorBainbridge.com
I was pleased to go out to Pepperdine today to give a talk based on my essay on The Parable of the Talents at their annual Nootbaar Conference on Law and Religion. Here's the slide deck: The Law and Economics of the Parable of the talents from Stephen Bainbridge Here's the abstract and link: On its surface, Jesus’ Parable of the Talents is a simple story with four key plot elements: (1) A master is leaving on a long trip and entrusts substantial assets to three servants to manage during his absence. (2) Two of the servants invested the assets... Continue reading
Posted Mar 9, 2017 at ProfessorBainbridge.com
Keith Paul Bishop responds here. Continue reading
Posted Mar 7, 2017 at ProfessorBainbridge.com
Only minor tweaks, but there you have it: On its surface, Jesus’ Parable of the Talents is a simple story with four key plot elements: (1) A master is leaving on a long trip and entrusts substantial assets to three servants to manage during his absence. (2) Two of the servants invested the assets profitably, earning substantial returns, but a third servant — frightened of his master’s reputation as a hard taskmaster — put the money away for safekeeping and failed even to earn interest on it. (3) The master returns and demands an accounting from the servants. (4) The... Continue reading
Posted Mar 7, 2017 at ProfessorBainbridge.com
I love being a professor. I love studying law. I love teaching law. And right now, I'm worried. I've always had to deal with the underrepresentation of people of faith and conservatives on faculties. I once dismissed that as a mere network effects problem, but now I'm not so sure. Like my fellow conservative law professors who sent that prophetic (in the correct sense of the word) letter to the AALS calling for affirmative efforts to promote intellectual diversity, I am increasingly persuaded that the problem is one of actual bias. But now things are going past the constant annoyance... Continue reading
Posted Mar 6, 2017 at ProfessorBainbridge.com
Congratulations to Paul Caron, the new dean of the Pepperdine law school. I hope he held out for one of those great on campus homes with the spectacular views of the Malibu. Continue reading
Posted Mar 6, 2017 at ProfessorBainbridge.com
Keith writes: I have never been reconciled to the Delaware Supreme Court’s pronouncement in Gantler v. Stephens, 965 A.2d 695, 709 (Del. 2009) that “the fiduciary duties of officers are the same as those of directors”. Officers are, as I’ve previously noted, agents of the corporation while directors are not. This means that an officer’s duties are sourced in agency law. Professor Deborah A. DeMott forcefully makes this point in a forthcoming paper: Making agency central to understanding officers’ positions and responsibilities helps to differentiate officers from directors. Like a director, an officer is a fiduciary, but distinctively so, not... Continue reading
Posted Mar 6, 2017 at ProfessorBainbridge.com
Joan writes: Last summer, at the National Business Law Scholars Conference at The University of Chicago Law School, I listened with some fascination to the presentation of an early-stage project by Todd Henderson (whose work always makes me think--and this was no exception). His thesis was a deceptively simple one: that the age-old disclosure debate could best be solved by creating a contextual market for disclosure (rather than by, e.g., continuing its the current system of "federal government mandates and issuer pays" or leaving market participants to their own devices as to what to disclose and punishing malfeasance merely through... Continue reading
Posted Mar 6, 2017 at ProfessorBainbridge.com
The NY Times reports that: Uber has for years engaged in a worldwide program to deceive the authorities in markets where its low-cost ride-hailing service was being resisted by law enforcement or, in some instances, had been outright banned. The program, involving a tool called Greyball, uses data collected from the Uber app and other techniques to identify and circumvent officials. Uber used these methods to evade the authorities in cities such as Boston, Paris and Las Vegas, and in countries like Australia, China, Italy and South Korea. ... Uber has long flouted laws and regulations to gain an edge... Continue reading
Posted Mar 3, 2017 at ProfessorBainbridge.com
The Washington Legal Foundation announced: On March 3, 2017, WLF asked the U.S. Supreme Court to overturn a Tenth Circuit decision that permitted the SEC to seek monetary penalties for securities law violations that occurred decades ago. In an amicus brief filed in the case, WLF argued that a strict five-year statute of limitations (28 U.S.C. § 2462) precludes such SEC enforcement actions. WLF reminded the appeals court that statutes of limitations serve important goals; they permit citizens to arrange their affairs secure in the knowledge that they won’t suddenly face sanctions based on long-ago events. WLF’s brief further contended... Continue reading
Posted Mar 3, 2017 at ProfessorBainbridge.com
I really like this new paper by Steven Davidoff Solomon and David Zaring: The Trump administration has promised to pursue policy through deals with the private sector, not as an extraordinary response to extraordinary events, but as part and parcel of the ordinary work of government. Jobs would be onshored through a series of deals with employers. Infrastructure would be built through joint ventures where the government would fund but private parties would own and operate public assets. We evaluate how this dealmaking state would work as a matter of law. Deals were the principal government response to the financial... Continue reading
Posted Mar 3, 2017 at ProfessorBainbridge.com
Randy Barnett wrote on February 25 that: ... for several years, a group of conservative and libertarian law professors from a variety of law schools has quietly been urging the Association of American Law Schools, which has taken a leadership role in addressing racial and gender diversity–including by establishing a Racial Diversity Task Force in 1999–to do the same with viewpoint or political diversity. Our complaint was not limited to the gross political one-sidedness of the Annual Meeting of the AALS, but primarily concerned the gross political imbalance of law faculties–especially in such subjects as public law where viewpoint most... Continue reading
Posted Mar 2, 2017 at ProfessorBainbridge.com
Lord Conrad Black, who is the largest shareholder and chairman of the board of directors of Hollinger International, has stepped down as CEO of Hollinger in the wake of charges that he and cronies received payments that had neither been approved by the board nor disclosed to the shareholders (see here). Black also is the author of a recent biography of Franklin Delano Roosevelt. Interestingly, one of the charges against Black is that he caused Hollinger to spend $8 million to buy FDR historical papers, which he presumably then used in writing his FDR biography. For a critique of Black's... Continue reading
Posted Mar 2, 2017 at ProfessorBainbridge.com
No. Keith Paul Bishop evaluates California law on the question: In the case of a California corporation, the answer is no. The power to remove directors is vested in the shareholders and the superior court pursuant to Corporations Code Section 303 and 304. While technically not a removal, one option may be available to a board. Section 302 provides that the board may declare vacant the office of a director who has been declared of unsound mind by an order of court or convicted of a felony. Under Delaware law, the board may remove its chairman from that office. But... Continue reading
Posted Mar 2, 2017 at ProfessorBainbridge.com