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Joan Heminway

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Professor Heminway brought nearly 15 years of corporate practice experience to the University of Tennessee College of Law when she joined the faculty in 2000. She practiced transactional business law (working in the areas of public offerings, private placements, mergers, acquisitions, dispositions, and restructurings) in the Boston office of Skadden, Arps, Slate, Meagher & Flom LLP from 1985 through 2000.

She has served as an expert witness and consultant on business entity and finance and federal and state securities law matters and is a frequent academic and continuing legal education presenter on business law issues. Professor Heminway also has represented pro bono clients on political asylum applications, landlord/tenant appeals, social security/disability cases, and not-for-profit incorporations and related business law issues. Read More

As on-campus interviews slow down, a lot of students now are coming to me looking for cover letter advice.  Since co-blogger Haskell Murray more-or-less asked me to write on this topic in response to a comment on his super post on resumes and interviews, I thought I would take the bait.  My principal thoughts on the subject are set forth below the fold.  Some of my observations and elements of my advice are conservative and anally compulsive, I know.  But consider the source:  I worked in Big Law for fifteen years before I started teaching law and served on a number of office hiring committees over that time. 

Thee are many good websites out there on cover letter drafting.  Most of the advice they give is good, but it is somewhat varied.  There are some things common and traditional in law job cover letters that may help students sift through the Internet prattle and settle on specific approaches.  That’s the overlay I hope to offer here.

In recent blog posts, two of my favorite bloggers, Keith Paul Bishop and Steve Bainbridge, have highlighted for our attention Delaware and California statutes providing (differently in each case) that an LLC and, at least in Delaware, its managers and members, are bound by the LLC’s operating agreement even if they do not sign that agreement.  Bishop notes in his post that the California “RULLCA creates an odd situation in which LLCs are bound by contracts that they did not execute and to which they seemingly are not parties.”  In his post Bainbridge cites to the Bishop post and another post by Francis Pileggi.  Certainly, they all have a point.  For students of contract law, the conclusion that a non-party is bound by a contract does not seem to be an obvious result . . . .

The flap in the blogosphere has its genesis in a recent Delaware Chancery Court decision, Seaport Village Ltd. v. Seaport Village Operating Company, LLC, et al. C.A. No. 8841-VCL.  The limited liability company defendant in that case raised as its only defense that it was not a party to the limited liability company agreement and therefore was not bound.  Unsurprisingly in light of applicable Delaware law, Chancellor Laster found the defense wanting as a matter of law.

This issue has more history than my brother bloggers point out, some of which is included in the brief Seaport Village opinion.  I probably don’t have all the details, but set forth below is some additional background information that may be useful in thinking about the binding nature of LLC operating agreements.  Others may care to fill in any missing information by leaving comments to this post.

Omnicare is back in court.  This time, it is petitioning the Supreme Court for relief in a legal battle under Section 11 of the Securities Act of 1933, as amended.  The question presented (as quoted from the cert petition) is:

For purposes of a Section 11 claim, may a plaintiff plead that a statement of opinion was “untrue” merely by alleging that the opinion itself was objectively wrong, as the Sixth Circuit has concluded, or must the plaintiff also allege that the statement was subjectively false—requiring allegations that the speaker’s actual opinion was different from the one expressed—as the Second, Third, and Ninth Circuits have held?

If this case sounds familiar to you, that may be because co-blogger Ann Lipton already has written about the case here on the BLPB.  As it turns out, Ann and I each have signed onto amicus briefs in the case supporting the same side–the respondents.  The brief that Ann is on can be found here.  The question addressed in that brief is “[w]hether an objectively incorrect statement of opinion is actionable under Section 11 . . . only if it was subjectively disbelieved by the defendant.”  Jay Brown‘s brief, of which I am a named co-author (together with Lyman Johnson and Celia Taylor), is here.  We address “[w]hether, for purposes of issuer liability under Section 11 . . . a statement in a registration statement attempting to characterize a verifiable, present fact about the legal validity of contracts as a ‘belief’ rather than a fact can shield an issuer from liability.”

I am passing on the English translation of a call for book chapters issued by a friend and colleague in Dijon, France.  The book is international and has a broad business management focus.

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As the editor of a forthcoming book, it is my greatest pleasure to invite you to submit articles as chapters. The tentative title is: Strategic Managerial Approaches to Crowdfunding Online. The book will be published by IGI Global publishers in the USA, within the series “Advances in Business Strategy and Competitive Advantage (ABSCA).”

Please read carefully the following guidelines for submission:

The context

The emerging crowdfunding phenomenon is a collective effort by individuals who network and pool their money together, usually via the internet and without any specific conventional financial intermediation, in order to invest in and support for-profit, artistic, and cultural ventures initiative undertaken by other people or organizations. The spontaneous interactions and transactions between individuals allow relatively considerable fund raisings by drawing on small contributions from a relatively large number of individuals using the Internet, without standard financial intermediaries.

The advent of crowdfunding coincides with the democratization of information technologies that enable people to contact, interact, collaborate and exchange at lowest costs, if not for free. In fact, information technologies have allowed the drastic reduction of transaction costs and by the same the revival of ancient forms of transactions such as auctions, barter, tenders, recycling, and direct transactions between individuals.

Many platforms encourage crowdfunding such as Kiva, Babyloan, MyC4 in lending to the poor entrepreneurs, Prosper, Kapipal and Zopa in P2P social lending, Kickstarter, MyMajorCompany in entrepreneurial projects, SellaBand in music, etc.

Call for Papers

ITEM 6 – Tunis, Tunisia

Microfinance: Coaching, Counting, and Crowding

The Banque Populaire Chair in Microfinance of the Burgundy School of Business (France) and l’École supérieure du commerce de Tunis jointly organize the 6th edition of the annual conference “Institutional and Technological Environment of Microfinance” (ITEM) in March 2015 (17, 18, 19) in Tunis, Tunisia.

The 6th edition brings together–but not limited to-three major issues, which are shaping the sector of microfinance: Coaching, Counting, and Crowding.

Coaching in microfinance provides training in business and soft skills (attributes enhancing an individual’s interactions and self-performance) that the poor micro-entrepreneurs rarely have. Increasingly, microfinance academics and practitioners consider building the human capital of micro-entrepreneurs a critical ingredient of moving out of poverty.

Counting and tracking the microfinance clients and prospects with the information technologies not only lessen information asymmetry, but also lower the transaction cost of financial intermediation. Corollary: information technologies can open ways for offering financial services to the poor as a normal way of doing and extending normal business, and accelerate their social integration. 

Crowding, based on the Web 2.0 technologies, enables direct interactions between millions of lending and borrowing people. Through crowdfunding, micro and…

Crowdfunding site GoFundMe recently removed the funding page for a person looking to crowdfund her abortion.  Past crowdfunding campaigns have funded fertility treatments, gender confirmation surgeries, organ transplants, and other medical procedures and treatments.  Watsi is an entire crowdfnding platform dedicated to financing medical care for patients through donations.  While I usually research and write about crowdfunding business entities and projects, the crowdfunding of medical procedures and treatments has gotten more and more traction with those needing or wanting financial assistance for expensive medical care.  It seemed like a good time to say something about it . . . .  But what to say?

Last week, I posted my observations (musings?) relating to a colloquy that I had with Tennessee Governor Bill Haslam at an event sponsored by the C. Warren Neel Corporate Governance Center on The University of Tennessee’s Knoxville campus.  At almost the same time, and not at all related to my attendance at that event, I picked up a reprint of a recent article, CEOs and Presidents, authored by Tom Lin at Temple.  Tom and I often work in overlapping fields.  In particular, both of us have shown interest, from different perspectives, in substantially similar issues relating to corporate executives. 

I commend Tom’s article to you.  It provides a lucid and engaging comparison of CEOs and Presidents (as the title suggests).  (His analysis is, of course,  significantly more rich and nuanced than the reflections I shared in my earlier post.)  But Tom’s piece doesn’t stop there.  It goes on to critique the desirability of the “President as CEO” model based on the harms posed to both corporations and democracies and also highlights some important lessons we can learn from his study.

I do want to challenge Tom on one provocative statement that he makes in the article, however.  After critically commenting on the dangers of (among other things) government reliance on private industry and values in the accomplishment of its objectives, he observes that “[g]overnment and corporations are not actual or conceptual substitutes for one another, but are complements of one another.”  He lists examples and avows that both government and private industry are optimized when they collaborate.  

Larry Cunningham has a further post on his forthcoming book, Berkshire Beyond Buffett: The Enduring Value of Values, over at Concurring Opinions.  The post includes an excerpt from Chapter 8 of the book, Autonomy, and links to the full text of the chapter, available on SSRN for free (!) download.  Larry’s and my earlier posts on the book here on the BLPB can be found here, here, here, and here.

Here’s a slice of the excerpt included in the Concurring Opinions post:

. . . Berkshire corporate policy strikes a balance between autonomy and authority. Buffett issues written instructions every two years that reflect the balance. The missive states the mandates Berkshire places on subsidiary CEOs: (1) guard Berkshire’s reputation; (2) report bad news early; (3) confer about post-retirement benefit changes and large capital expenditures (including acquisitions, which are encouraged); (4) adopt a fifty-year time horizon; (5) refer any opportunities for a Berkshire acquisition to Omaha; and (6) submit written successor recommendations. Otherwise, Berkshire stresses that managers were chosen because of their excellence and are urged to act on that excellence. 

Cool stuff . . . .

On Friday, Bill Haslam, the Governor of the State of Tennessee, spoke at a session sponsored by the C. Warren Neel Corporate Governance Center on The University of Tennessee’s Knoxville campus.  He is our former city mayor and a hometown favorite for many.  I always enjoy his talks.

His talk on Friday focused on how Tennessee is attracting businesses and jobs and how education–including higher education–plays a role.  But before he honed in on that topic, he asked an intriguing, albeit basic, question that operates on theoretical, political, and practical planes.  That question: How is government similar to and different from private enterprise?  He wanted audience participation.  I waited to see how everyone would react.  He got lots of good answers that cut across economics, management, finance, and governance.

Provocatively (at least for me), he characterized his gubernatorial role as akin to the role of a chief executive officer in a corporation.  He has served as a corporate manager (president of his family’s firm and the CEO of a division of another firm), and his vision of the state gubernatorial role is clearly framed by that experience.  He actually called the legislature his “board of directors” in his role as governor. 

Well, after that analogy, I just had to contribute to the discussion with a comment.  I endorsed the governor’s view of his position, but I also noted that the executive, as the head of a separate branch of a government of three branches, has power independent of the power afforded to the legislature.  That is when things got interesting, at least for me.

Thanks for your informative post, Anne.  I started drafting this post as a comment to yours, and then I realized it was its own post.   [sigh]

It seems to me that the U.S. Department of HHS and any commentators must grapple with what has been a difficult, fact-based question in determining how to define “closely held” to effectuate the Supreme Court’s intent in as expressed in the Hobby Lobby opinion.  That question?  What “control” means in this context.

The Court said in the Hobby Lobby opinion:  “The companies in the cases before us are closely held corporations, each owned and controlled by members of a single family, and no one has disputed the sincerity of their religious beliefs.”  More specifically, the Court notes that the Hahns (owners of shares in Conestoga) “control its board of directors and hold all of its voting shares” and notes that Hobby Lobby and Mardel “remain closely held, and David, Barbara, and their children retain exclusive control of both companies.”  [Emphasis has been added by me in each quote.]

The definition of “control” primarily has been a question of fact in business law, making the task of defining it here somewhat difficult.  Some questions and considerations to grapple with are set forth below the fold.  I am sure that others can come up with more.  I am posting these as a way of getting the collective juices flowing.