March 2016

It has been a crazy busy couple of weeks, and one thing I rely on the keep sane (or sane-ish) is music. This morning I was listening to the most recent Public Enemy album, Man Plans God Laughs, which includes a song called “Corplantationopoly.”  (The album is solid, and while it will never top Nation of Millions or Fear of a Black Planet, Chuck D is still powerful to hear.)  This got me to thinking about songs that reference business as part of their lyrics and/or theme.

With the availability of the internet, of course several such lists have already been compiled. Here is a sampling:

  1. 30 Best Songs About Business and Money
  2. Songs About Money, Business, Finance and Economics
  3. Top 10 Business Songs of All Time | Veritas Prep
  4. The Top 25 Entrepreneur Theme Songs | Addicted 2 Success
  5. 10 Famous Rap Songs About Money
I didn’t go to those, though.  Following is my quick list of my five best business songs.  “Best” in this context is the songs that came to mind that talked about business or money.  No voting. No quality assurance.  Pure memory and impulse.  So here you go, my five “best.”  I welcome thoughts and other suggestions

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Let Feeling, Passion, Reason, Sense appear—
But mark you! Let us have some Nonsense too!
    -Goethe

Whatever happened to humor in law reviews?

In the past, leading law reviews had no qualms about including legal humor. Yale, for example, published Jim Gordon’s How Not to Succeed in Law School, 100 YALE L. J. 1679 (1991). Northwestern published my The Gettysburg Address as Written by Law Students Taking an Exam, 86 Nw. U. L. REV. 1094 (1992). Michigan published Dennis Arrow’s incredible tome, Pomobabble: Postmodern Newspeak and Constitutional “Meaning” for the Uninitiated, 96 MICH. L. REV. 461 (1997).

At least two law reviews in the nineties published symposia on legal humor: BYU (Symposium on Humor and the Law, 1992 B.Y.U. L. REV. 313-558) and Nova (Nova [Humor in the] Law Review, 17 NOVA l. REV. 661-1001 (1993)). The BYU symposium even includes an excellent bibliography of legal humor: James D. Gordon, III, A Bibliography of Humor and the Law, 1992 B.Y.U. L. REV. 427.

The era of law review humor seems to have passed. There isn’t much legal humor in law reviews anymore. There are exceptions: Green Bag and the Journal of Legal…

The Wall Street Journal reports on a growing phenomenon – in the wake of cases like RBC Capital Mkts., LLC v. Jervis, 2015 Del. LEXIS 629 (Del. Nov. 30, 2015), corporate boards considering M&A deals are rooting out investment banking conflicts by turning to smaller boutique firms to advise them.

My off the cuff reactions –

First, I find this notable if only because board directors are shielded from personal liability both by exculpatory clauses in corporate charters, and by D&O insurance. Scholars frequently argue that the lack of personal liability blunts the potential deterrent effects of shareholder lawsuits; I am fascinated to see a real-world demonstration that the lawsuit threat remains potent. It’s particularly striking in this instance because ultimately it is the conflicted banks – not the directors – who risk liability, and yet the directors are the ones who are exhibiting concern. This is a salutary result: the directors, of course, are the ones who have a fiduciary duty to protect shareholders. (But cf. Andrew F. Tuch, Banker Loyalty in Mergers and Acquisitions) But it’s not necessarily what one would have expected given the liability regime. The WSJ piece suggests that boards’ concerns…

For those of you who talk about the recent problems at Volkswagen in your classes, this recently posted article may be useful. I connected with Charles Elson briefly when I lived in Delaware, and he is certainly an authority on corporate governance. The article is available here and the abstract is posted below. 

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Although the primary cause of the emissions scandal at Volkswagen appears to have been misfeasance and malfeasance on a corporate-wide scale, we argue that such a problematic culture existed at Volkswagen because of the composition of the board itself in combination with the unique governance structure known as “co-determination,” that defines many German companies, including VW. There are three major problems from a corporate governance standpoint with the Volkswagen board. First, is the interest-conflicting nature of the dual-class stock held by the dominant shareholding Porsche and Piech families. Second, is the presence of a government as a major shareholder. And third is the organization of its characteristically German “two-tier” board around the principle of co-determination, which mandated significant labor representation. We argue that each of these elements of the VW ownership and governance structure contributed in varying degrees to the board failure of oversight that led…

Christopher Bruner recently posted a book chapter entitled The Corporation’s Intrinsic Attributes. I try to read everything Christopher writes, including his excellent Cambridge University Press book, Corporate Governance in the Common Law World, and I am looking forward to reading this new book chapter over spring break next week. The book chapter’s abstract is reproduced below for interested readers:

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Numerous treatises, casebooks, and other resources commonly present concise lists of attributes said to be intrinsic to the modern corporation and/or essential to its economic utility. Such descriptions of the corporate form often constitute introductory matter, conditioning how students, professionals, and public officials alike approach corporate law by presenting a straightforward framework to distinguish the corporate form from other types of business entities. There are two significant problems with such frameworks, however, from a pedagogic perspective. First, these frameworks describe the corporation by reference to purportedly fixed intrinsic attributes, conflicting sharply with the flux and dynamism that have in fact characterized the history of corporate law. Second, these frameworks differ markedly from each other in how they characterize the corporation’s attributes, each embodying a contestable perspective on the nature of the corporate form.

The diversity of perspectives that such inquiry…

Presidential candidate Donald Trump has repeatedly stated that he never plans to eat Oreo cookies again because the Nabisco plant is closing and moving to Mexico. Trump, who has starred in an Oreo commercial in the past, is actually wrong about the nature of Nabisco’s move, and it’s unlikely that he will affect Nabisco’s sales notwithstanding his tremendous popularity among some in the electorate right now. Mr. Trump has also urged a boycott of Apple over how that company has handled the FBI’s request over the San Bernardino terrorist’s cell phone.

Strangely, I haven’t heard a call for a boycott of Apple products following shareholders’ rejection of a proposal to diversify the board last week. I would think that Reverend and former candidate Al Sharpton, who called for the boycott of the Oscars due to lack of diversity would call for a boycott of all things Apple. But alas, for now Trump seems to be the lone voice calling for such a move (and not because of diversity). In fact, I’ve never walked past an Apple Store without thinking that there must be a 50% off sale on the merchandise. There are times when the lines are literally…

It’s fun when students are interested in your scholarship.  Yesterday, one of my students engaged me to talk about my work on limited liability operating agreements as contracts.  (I have mentioned this work in class, and the student also is a regular reader of this blog, where I have referenced this work a number of times, including most prominently here.)  He began the exchange with something akin to the following question: “Why is it that we take two full semesters of contract law during the first year of law school and then all but ignore the connection of contract law to business entities once we get to Business Associations?”

I think I know what he means.  While the segregation of legal doctrine by subject matter in law schools enables instructors to focus students narrowly on a single–often new–body of law, it also tends to obscure the interconnections between and among applicable bodies of law, including connections between contract law and the law of business entities.  Admittedly (and I pointed this out to the student), the typical Business Associations course does typically address contracts at several points.  These junctures include, among others, the course segment in which sole proprietorships are distinguished from statutory forms of business…

I have long followed the trials and tribulations of Chesapeake Energy and founder Aubrey McClendon, and I had been planning to write about yesterday’s indictment of McClendon for bid rigging in a couple weeks, after I gathered more information.  About an hour ago, though, reports broke that former Chesapeake CEO Aubrey McClendon died today.  According to CNBC:

Aubrey McClendon, a founder and former chief executive of Chesapeake Energy, died in a single-car crash Wednesday at age 56, a day after he was charged with conspiring to rig bids for oil and natural gas leases.

McClendon crashed into an embankment while traveling at a “high rate of speed” in Oklahoma City just after 9 a.m. Wednesday morning, said Capt. Paco Balderrama of the Oklahoma City Police Department. Flames engulfed McClendon’s vehicle “immediately,” and it was burnt so badly that police could not tell if he was wearing a seatbelt, he said.

Before going any further, my thoughts go out to his friends and family.  Regardless of how anything else comes together, their loss is real, and I feel badly for them.  

In years past, I have questioned how Chesapeake conducted some of their business, including their use of entities and

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It’s super Tuesday and in the spirit of this big primary day, let’s look at corporate spending in the election.  

First, let’s talk about someone who isn’t in the race anymore, Jeb Bush.  Ciara Torres-Spelliscy, law professor at Stetson University College of Law, and Brennan Center Fellow, wrote piece highlighting the role of corporate money in Jeb Bush’s Super Pac.  Corporate money was big business for Jeb.  Torres-Spelliscy discusses a $10 million donation from CV Starr with former AIG CEO Maruice Raymond “Hank” Greenberg at the helm, several private company donations over $1M and a multi-million dollar donation from publicly traded, NextEra Energy Inc (NYSE ticker: NEE).  Torres-Spelliscy writes “If anyone ever tries to sell you the bill of goods that corporations are not taking advantage of their Citizens United rights to spend in American politics, remember this: the top donor to Jeb! Bush’s Super PAC was a corporation.”  Read her full account here.

The failure of Jeb Bush’s well-moneyed campaign has generated debate about the “real impact” of money in politics if it can’t produce a certain result. Rick Hasen, election law professor at University of California Irvine and prolific writer behind the Election Law Blog…