I had to be out-of-town (at an AALS/ABA sabbatical site review) when all of the key news about law firm settlements with the executive branch of the federal government started to become public. As a former Skadden lawyer, I watched with interest to see what my former firm would do. Now, we all know.

In those early days of reporting on the issue, I determined to change my class plan for one of the class sessions I had to miss that week to offer an out-of-class activity related to fiduciary duty law in the context of the law firm settlements. At the time, we were reading about and discussing the fiduciary duties of corporate directors and officers. Set forth below is the assignment I gave, in relevant part.

Yesterday, The New York Times published the attached article. [this one, on the Paul, Weiss settlement] Many of you may have read about the referenced brokered deal between the Paul, Weiss firm and the Trump administration. But did you consider the related firm decision making as a matter of business associations law? I want us to engage with that in lieu of today’s class, using our knowledge of partnership law and the readings to date on corporate law. We will do this preliminarily through a class discussion forum I have set up on TWEN for that purpose titled “Partnership and Corporate Fiduciary Duties.” You will find it on the TWEN site in the toolbar under the “General Discussion” forum. I am asking each of you to publish a post to that forum in accordance with the instructions below.

Paul, Weiss is an LLP–a limited liability partnership (Paul, Weiss, Rifkind, Wharton & Garrison LLP). Accordingly, it is governed by its partners under partnership law. We do not know what the partnership agreement provides, but we do know from press reports that the firm has a managing partner. But we also could imagine it being organized as a corporation, with a corporate charter and bylaws, under the law of Delaware or a state adopting the Model Business Corporation Act.

With all of that in mind, please publish a post in the Partnership and Corporate Fiduciary Duties forum that answers one of the following two sets of questions , either through a primary post or through a reply to a classmate’s post:

1. Can the decision of Paul, Weiss, made by its managing partner or by partners in the firm, be justified as a matter of the law governing partnership fiduciary duties under the RUPA and the decisional law we have read? If so, why? If not, why not?
2. Assuming Paul, Weiss were organized as a corporation, same question: can the decision of Paul, Weiss, made by its board of directors and implemented by its officers, be justified as a matter of the law governing corporate fiduciary duties under (a) Delaware law or (b) the MBCA and the decisional law we have read to date? If so, why? If not, why not?

Your answer can be “yes, but . . .” or “no, unless . . .” or something similar. But you must use and cite to supporting law from our class assignments to answer the set of question you choose to answer.

In your post, please clearly indicate and label the specific fiduciary duty you are addressing and cite to relevant authority .

I must say that I was happy with (and even impressed by some of) the posts. Most students located the appropriate sources of law and cited to them. They endeavored to label the fiduciary duties properly in the different statutory and decisional law contexts, and they applied the law in the decision-making context presented. Overall, the project tied together work we had done on partnership fiduciary duties and helped develop understandings of the corporate law material. We also were able to compare and contrast the different laws and labels for fiduciary duties in partnerships and corporations and add to the discussion the notion that decision makers in this context also would have to wrestle with possible competing duties from other sources (e.g., those from professional responsibility rules/norms and moral philosophy/morality).

While not every experiment like this works well to illuminate law consistent with the learning objectives we set for students in our courses (as those of us with significant teaching experience well recognize), this one did, from my perspective. I share the exercise here as an example and food for thought. I truly appreciated the thoughtfulness of my students’ submissions and the ensuing class discussions.