Today, we’ve got a guest post from David Lourie at the University of Detroit Mercy School of Law. He will present the teaching exercise below at the Transactional Law and Skills Pedagogy Panel at AALS this year. Some of the other presenters may also post write ups of their teaching exercises as well. I’ll aim to link them all to each other as this goes on so readers can find interesting teaching exercises. — BPE

On the first day of my Transactional Skills course, I have students engage in an active, experiential exercise where they apply diverse aspects of transactional skills to a relatable problem.   Later in the semester, when students have greatly enhanced their technical expertise, I assign students a related, out-of-class, multi-part exercise where they are graded.  In both exercises, students have three main tasks: thinking strategically, negotiating, and drafting. 

In the first exercise, I use a problem from Sepinuck’s Transactional Skills textbook as a starting point, but I greatly expand what the students must do so that I can preview the entire course and showcase the broad skills the students will utilize as transactional lawyers.  First, I divide the students into groups of four.  I then provide them with a scenario where they are moving into an apartment together for the law school academic year and provide background on each student, including their budget and social preferences such as quiet hours, cleanliness, and preferences on guest policies.  I also present information about the “real” apartment, that I choose from listings of apartments in downtown Detroit where our school is located, such as the total rent, different room options, garage space, and campus location. 

The students are first tasked to strategically discuss the issues that should be addressed in a “Roommate Agreement” among the four roommates (e.g., rent, social issues) and to prioritize those issues.  I then ask each group to share the issues they believe should be in the Roommate Agreement with the entire class.  Next, I facilitate an all-class discussion where we analyze the similarities and differences between the issues each group identified.  As a class, we decide on the issues to address in the Roommate Agreement.  This prepares students for what’s to come in the course: although students do not yet know the technical details of clauses such as a merger or indemnity clause, they begin to think strategically about the type of clauses that should be included and what those clauses should accomplish – so, for example, without using the word “merger clause,” a student may understand that they want to protect the integrity of the writing.

Next, I pick a particular clause the class has agreed should be in the Roommate Agreement – such as how the security deposit will be apportioned and who will be responsible if any issues limit the return of the deposit from the landlord, and have each group conduct an internal four-person negotiation of that clause, with each student representing their interests.  Once the groups have negotiated the parameters of the clause, I have them work as a team of four to draft it for the Roommate Agreement.  This previews for students the technical drafting skills they will learn during the semester: students often realize it is easier to “talk out” a contract clause than to draft it.  Once each group has drafted its clause, I return to an all-class discussion.  I put each group’s clause on a slide, and the class discusses the strengths and weaknesses of the clause.  This allows me to introduce concepts such as covenants, conditions, and declarations and how they should be utilized when drafting.

This exercise effectively engages students by taking a holistic approach to transactional skills.  Students have three main tasks: thinking strategically, negotiating, and drafting.  It simulates what students will be doing as transactional lawyers and the skills they will learn throughout the semester through an experiential exercise that is relatable and accessible.  This is not just a theoretical exercise but a practical simulation of the future work students will be doing, reinforcing the relevance of the course to their future careers.

As the semester progresses and the students’ technical knowledge of contract drafting and strategy grows, we perform an enhanced multi-part exercise where the expectations are higher (students draft the entire contract), most of the work takes place outside of class, and the assignment is graded.  Here, I divide students into groups of four, with one group representing the law school’s Student Bar Association (“SBA”) and the other representing a downtown Detroit venue where the SBA is hosting a Halloween party.  I provide the two sides with different instructions – describing what their side is seeking to obtain in a written contract to have a successful event. 

There are three parts to this assignment.  First, the groups of four meet internally to discuss their strategy and the clauses they believe should be in a final written agreement and turn in a written “strategy memo” that documents this.  Next, I give the groups one week to negotiate the full agreement terms with their counterparts (i.e., price, cancellation, venue logistics, etc.).  Once complete, each group turns in a “negotiation memo” that discusses the results of their negotiations and assesses how it went – what went well and what they would look to improve on.  Lastly, I give each group one week to draft the final written agreement between the SBA and the venue.  At this point in the course, the students are experienced in the technical aspects of contract drafting and can draft a contract as they will as associate attorneys at their future jobs.

My second “jot” was published on Jotwell last week. Titled “Digital Engagement and the Retail Investor,” the jot summarizes and comments on Sergio Alberto Gramitto Ricci & Christina M. Sautter, Wireless Investors & Apathy Obsolescence, 100 Wash. U. L. Rev. 1653 (2023). The meat of the jot is set forth below.

The article’s insights (and embedded take-aways from Gramitto Ricci and Sautter’s earlier work) are relevant to several large-scale business law topics. Two are most salient for me: shareholder primacy and the reasonable investor standard. Each area of inquiry and debate connects with the composition or behaviors of corporate shareholders.

Whether addressing shareholder primacy as a matter of the locus of corporate governance power as among the corporation’s internal constituents (through, e.g., voting or derivative litigation) or in terms of the objective of board decision making, shareholder apathy and coordination may be important to analyses and judgments. In shareholder primacy debates, assumptions often are made about the nature and interests of corporate shareholders. Changes in the identity and engagement of shareholders may alter those assumptions.

Similarly, the reasonable investor standard (which is incorporated in materiality definitions used in, among other things, federal securities regulation) is rooted in an understanding of investor (including shareholder) identity and conduct. The standard is intended to be objective. But investment markets and investors evolve over time. Thus, objective assessments of them also must evolve. Wireless Investors & Apathy Obsolescence, taken alone or together with Gramitto Ricci and Sautter’s related work, provides evidence of changes in equity investment markets and shareholder behavior patterns that may be significant to applications of the reasonable investor standard.

If I must say so myself, the entire jot is worth a read! But more importantly, the article itself is important to many current (and likely future) conversations in corporate finance.

A few years ago and before I had tenure, one of my more senior UNLV colleagues asked me to write a short piece for the ABA’s Human Rights Magazine on corporate political spending. As this isn’t my primary focus, I benefited enormously from reading work from Dorothy Shapiro Lund and Leo Strine as well as Tom Lin. The format didn’t allow for citations so I try to just use their names whenever I talk about it so it’s clear their ideas influenced me.

I made the time to write it and the essay has resulted in a decent amount of outreach to talk about the topic. Last week, a portion of an interview I gave to Marketplace ran. They reached out because of that short piece in the ABA magazine. Since then, I’ve heard from classmates I haven’t talked to for some time calling and texting to tell me they heard the interview. Apparently, I’m friends with an NPR-listening crowd.

If you want your work to reach larger audiences, you really have to write short pieces in addition to law review articles. On a few occasions, I’ve had op-eds follow law review articles. It’s a challenge to distill a complex law review article into an op-ed, but I find it helps to remember that you don’t need to give them the full argument–just make your case in a fair way.

When you reach a broader audience, you also see a broader range of reactions. Some hostile email has come in from offended stockbrokers or lawyers from time to time, but overall I think the benefits outweigh the blowback.

Now that I’m on the other side of the tenure divide, I’d probably still want to write that small piece, but I wouldn’t feel any pressure to do it. If it makes sense for you, I’d encourage you to do some short form writing as well. We often measure ourselves by our law review footprints, but I don’t know how much that will always matter. As institutions get better at measuring other forms of scholarly impact, you might see surprising returns from shorter-form work. You might also independently decide that doing some things with broader distribution matters to you even if your institution isn’t skilled at counting and quantifying that impact.

Hi, everyone – welcome to BLPB at the new place! As you can see, we’ve imported our old posts over here but in the process, the authors got scrambled for a lot of the older ones … we’ll work that out eventually. So! Moving on –

OpenAI’s been in the news, again, and there are some interesting things to talk about.

First, apparently both OpenAI, and Anthropic before it, have been raising funds through SPVs.  The SPV formally invests in the company; the SPV raises the funds from the real investors.

The purpose of that is the securities laws. If OpenAI/Anthropic have too many investors, they’ll have to make public filings.  But each SPV counts as a single investor.  So, by taking investment through SPVs, OpenAI and Anthropic can keep their formal investor count below the threshold of becoming a public company, while in fact raising capital from a dispersed group.

That said, it only works if OpenAI/Anthropic are not the ones organizing the SPVs. If they are, they’re evading the statutory limit on the number of investors a private company can take on.  The SEC’s view is that this trick only works if the SPVs are organized independently of the issuer.  I had a blog post on this way back when it was relevant to Uber.

When Uber did this, the impression I got was that investment banks created the SPVs to please clients who wanted access to a hot startup, and who were wealthy but didn’t, individually, have the kind of cash that attracts the attention of venture-backed companies.  But OpenAI’s SPVs are not being organized by investment banks; they’re being organized by large venture capital firms, who have preexisting investments in OpenAI. 

According to Anat Alon-Beck and John Livingston, this is becoming increasingly common, suggesting we’ve come a long way from investment banks trying to please clients who want access, and now this is just an alternative way to meet the capital raising needs of startup companies while allowing them to stay private.  OpenAI, we know, has enormous need for capital.

Point being, I wonder in these situations just how “independent” the SPV capital raises are, which is supposed to be a precondition to avoid counting their investors as investors in the issuer.  After all, VC firms often get governance rights along with their investments, they provide counseling/guidance to their portfolio firms, so in some sense they “are” the issuer, potentially going out and organizing an SPV so that they can funnel money to the firm while staying under the securities laws’ radar.  That whole process not only exposes perhaps smaller investors to increased risks, but also permits large and societally important firms to stay dark, without exposing their operations to public scrutiny.

But that’s not the only interesting OpenAI news!  There are also reports that it may abandon its current structure – an LLC, where investors can receive only a capped profit, operated by a nonprofit – in favor of a public benefit corporation.

That fact itself tells you something about the toothlessness of the public benefit corporation structure, but one of the weirder things is that apparently they’re claiming the public benefit form will help fend off activist attacks.

As I’ve previously discussed, there’s nothing about the benefit corporation form that, in fact, does prevent activism. OpenAI is still a private company, and I imagine is quite a long ways from going public, which means it’s insulated from activist attacks currently.  Even if it does go public, I find it difficult to imagine it wouldn’t have a multi-class share structure that would be sufficient to fend off activists, and since the benefit corporation form itself doesn’t do that work, I view the choice of the benefit corporation form as greenwashing, i.e., an attempt to put a happier face on the fact that the company is abandoning the nonprofit mission that was supposed to protect humanity, or whatever.

But maybe I’m wrong about that.  This is an interesting question, we could ask, post Coster v. UIP Cos. In Coster, the Delaware Supreme Court laid out the framework for assessing defenses that interfere with shareholder voting:

When a stockholder challenges board action that interferes with the election of directors or a stockholder vote in a contest for corporate control, the board bears the burden of  proof. First, the court should review whether the board faced a threat “to an important corporate interest or to the achievement of a significant corporate benefit.” The threat must be real and not pretextual, and the board’s motivations must be proper and not selfish or disloyal. As Chancellor Allen stated long ago, the threat cannot be justified on the grounds that the board knows what is in the best interests of the stockholders.

Second, the court should review whether the board’s response to the threat was reasonable in relation to the threat posed and was not preclusive or coercive to the stockholder franchise. To guard against unwarranted interference with corporate elections or stockholder votes in contests for corporate control, a board that is properly motivated and has identified a legitimate threat must tailor its response to only what is necessary to counter the threat. The board’s response to the threat cannot deprive the stockholders of a vote or coerce the stockholders to vote a particular way.

Is there an argument that benefit corporation directors have more leeway to interfere with shareholder voting, say, if an activist wants to run a proxy contest, than they would in an ordinary corporation?  After all, Coster says a defense cannot be motivated by the directors’ belief they know what is best for stockholders – but what if the defense were motivated by the directors’ belief that the stockholders’ interests must not be permitted to overwhelm a stakeholder’s interest in a corporation established to advance that interest?

My suspicion is, it shouldn’t matter.  The form itself represents a choice by investors to pursue a social mission; which means that ultimately the mission rests in their hands.  Plus, Delaware amended its statute to permit conversion to, and away from, the benefit corporation form with a mere 50-percent vote (rather than a supermajority), and also removed statutory provisions that would have granted shareholders in ordinary corporations appraisal rights upon conversion to a benefit corporation.  All of which suggests that the principle that the “shareholder franchise is the ideological underpinning upon which the legitimacy of directorial power rests” remains just as intact in a benefit corporation as it does with any other corporation, which means there should be no special license to interfere with shareholder voting.  I mean, if shareholders can convert to ordinary corporation status with a mere 50% vote, surely directors can’t interfere with shareholders’ choice to do that kind of thing.

Plus, given how weak the enforcement rights are in benefit corporations alleged to have strayed from their social missions, I suspect that if Delaware courts were to rule that the form grants directors more leeway to fend off activists, suddenly corporate America would discover a new love of social purpose.

But, I suppose this is an issue lurking around that Delaware may one day have to confront.

And another thing.  New Shareholder Primacy podcast is up!  This time, me and Mike Levin talk SEC climate change rules, and the activist attack at Pfizer. Available at Apple, Spotify, and YouTube.

I’m super excited to attend and moderate a panel on How to Improve Your Contract Skills with Gen AI Tools and Products at the ContractsCon in Las Vegas from January 22-23, 2025. As the GC for a startup and a nonprofit, and someone who directs the Transactional Skills Program for a law school, I have to stay up to date on the future of contracts for my clients and to prepare our students for a world that will be completely different from the one they expected.

This is not the typical boring CLE. How to Contract Founder, Laura Frederick describes it as “practical training for the work you do all the time.For every mega M&A transaction or financing, there are thousands of regular contracts that companies handle day-in and day-out. This training helps you learn how to do those BETTER with strategies based on best practices used by top lawyers with solid real-world in-house experience. Have a ton of experience already? This event is perfect for lawyers and professionals with 10+ years of contract experience too. We’ve added a whole day of training built to teach advanced contract skills. Plus you can connect with your peers and help out the ones earlier on the training path.” 

Below are the options for the in person sessions.

And if you can’t make it to Vegas, there’s a virtual option available as well.

Buy your tickets asap because the rates go up soon. And I promise you that other than the substantive legal concepts, what happens in Vegas stays in Vegas.

I’ve covered the The Trade Desk proxy here before and how controlled companies might benefit from redomesticating away from Delaware. In his memorandum accompanying the proxy statement, Steven Davidoff Solomon points out that his own analysis does not show any negative premium associated with incorporating away from Delaware. This is how he put it:

As I noted above in Section IV, recent academic studies have found no premium associated with Delaware incorporation, and in some cases, such a premium may even be negative for controlled companies. To provide further information on this issue to the Board, I conducted case studies of the five reincorporations out of Delaware involving companies with a market capitalization of at least $200 million. These companies are Tesla, Inc., Fidelity National Financial, Inc., TripAdvisor, Inc., Cannae Holdings, Inc., and Rezolute, Inc.

Evidence for a possible negative premium for controlled companies incorporated in Delaware comes from an article by Edward Fox, that “finds, surprisingly, that controlled Delaware firms are actually slightly less valuable than similar companies incorporated elsewhere.” (emphasis in original).

Given that recent redomestication announcements for companies with market capitalizations of over $200 million have already been examined, I thought it might be interesting to take a crude peek at market reactions for companies reincorporating to Nevada with under $200 million in market capitalization.

These firms sit in a different position because the fees and expenses associated with maintaining a Delaware domicile may be more material to them. As best I can tell, the recent Nevada reincorporations include Laird Superfood, Inc. (LSF); Save Foods, Inc. (NITO); Augusta Gold Corp. (AUGG); LogicMark, Inc.(LGMK); and Dragonfly Energy Holdings Corp. (DFLI).

Let’s start with Laird Superfood. It currently has a market cap of about $63 million. It announced an intention to redomesticate to Nevada on Saturday, September 23, 2023 in a preliminary proxy. The stock price did not seem to react much when trading resumed on Monday, September 25, 2023. Of course, this is a small firm and probably not the most efficient market.

Save Foods offers another example, but probably one of only marginal utility. The company is now known as N2OFF, Inc. It appears to have announced on Monday, July 31, 2023 with a preliminary proxy. The proxy sought approval for reincorporation and a reverse split at the same time. The trade volume seems remarkably low through this period–likely indicating that nobody really cared. This is unlikely to be an efficiently traded firm, so it’s hard to draw any real conclusions.

Our next small firm data point is Augusta Gold Corp. It announced its plans on Tuesday, July 18, 2023 in a preliminary proxy. It also didn’t seem to have any large impact. Again, this is such a small firm that it’s hard to draw any real conclusions.

LogicMark is another example of limited utility. It currently has about $1 million in market cap. It took two shots at reincorporating to Nevada. It first declared its intentions on Friday, June 17, 2022 in a preliminary proxy. The proposal was not approved. It tried again about six months later, announcing its intentions in a preliminary proxy on Wednesday, January 4, 2023. Again, the stock price does not appear to be reacting–which isn’t surprising given the market cap. This second time the proposal was approved.

Finally, Dragonfly Energy Holdings offers another example with a current market cap of about $37 million. It announced a plan to reincorporate on Thursday, January 12, 2023 in a preliminary proxy. Here, I pulled a slightly different chart because it appears Dragonfly’s stock price was declining all through that month. I don’t see any change in the overall trend right around the reincorporation.

So what to take away from these data points? I don’t see any great evidence, on my limited, unsophisticated look that reincorporations affect the stock price significantly for these small firms. It’s hard to draw any firm conclusions because: (1) these are not event studies; (2) I’m not comparing to similar firms; and (3) this chunk of the market does not appear to be efficiently traded.

For firms where there only real asset is their status as a public company, it probably makes sense to reincorporate to the cheapest jurisdiction if they don’t have a merger partner.

One of the more interesting topics that I have been following under the Corporate Transparency Act (CTA) is the debate about the reporting status of limited liability partnerships (LLPs).  Are LLPs reporting companies under the CTA?  A recent Business Law Today article written by friends-of the-BLPB Bob Keatinge and Tom Rutledge argues they are not.

As the article notes, the debate centers around whether an LLP is an “entity” similar to a corporation or limited liability company that is “created by the filing of a document with a secretary of state or a similar office under the law of a State.”  Certainly, an LLP is created by a secretary of state filing.  However, is a new entity created by that filing, or is an LLP merely a type or status of partnership created by that filing?

I have read much on this debate over the past year and had conversations with many intelligent, experienced practitioners on both sides of the matter.  A textualist approach supports the conclusion reached by Bob and Tom in their article–that LLPs are not new entities.  Yet, detractors note that Bob and Tom’s conclusion, well supported by the history and interpretations of partnership law they present, seems a bit too cute. 

The missing link relates to the policy intended to be served by the CTA through its reporting company definition.  In general, the CTA is designed to provide government law enforcement agents with beneficial ownership information to help preempt, discover, and punish misconduct occurring in business organizations. Given that policy, we might ask whether Congress and FinCEN intended to establish reporting company status based on the concept of a legal entity (the focus of Bob and Tom’s article) or, instead, on the governmental recognition and regulation of an organization through a filing process that brings a business firm and certain information about it into the public realm.  Ultimately, if the federal government desires to ensure that LLPs file reports under the CTA, Congress should act to clarify the matter. 

In any case, I appreciate the analysis Bob and Tom have provided and am happy to be able to share it here.

Although FINRA has changed its rules to deal with abuse of the expungement process, the new rules only apply to claims filed after October 16, 2023.  There are still claims in the pipeline that were filed before then.  For example, an award recommending expungement of twenty nine different complaints recently appeared on FINRA’s website.  That case was filed on October 13, 2023–three days before the reforms designed to stop abuse went into effect.

Because he already had a pending expungement claim, the broker, Matthew S. Buchsbaum, may have been able to expunge a customer complaint arriving after the deadline.   The award also explains that the arbitrator, Laura Carraher, granted an unopposed Motion to Amend the Statement of Claim on July 18, 2024.  The amendment added an additional occurrence to the long list of claims being expunged.  The award itself is fairly sparse on details.  It doesn’t reveal when the additional customer complaint arrived or the details of it.  Given the ability of counsel to identify so many prior customer disputes on the broker’s record, it was probably a customer complaint that emerged after October 16, 2023.  But the award doesn’t give that level of detail, so there is no way to know.

As far as I know, this is probably the new record holder for the most claims expunged in a single arbitration award.  I covered this process in a law review article published in 2020.  At that time, the record holder was Gregory Brian VanWinkle who managed to expunge 24 complaints in a single hearing.  So, congratulations to Mr. Buchsbaum and UBS Financial Services Inc. for taking the title with an award expunging 29 complaints at once.  Someone should create a plaque to memorialize the achievement.

The award illustrates so many problems with the expungement process.  None of the customers whose complaints were up for review participated in the expungement hearing.  It’s not clear exactly how much notice the customers had or what form it arrived in.  All the award says is that on August 13, 2024 the claimant told the arbitrator that they had been served with the Amended Statement of Claim and notice of the date and time of the expungement hearing.  The hearing occurred on September 5, 2024.  That’s less than 30 days after August 13th.  Now, the award does not reveal how much time the customers actually had–it just states that the claimant told the arbitrator that customers had been served on August 13th.  

There is no reason to think anything approaching an adversarial process occurred in this expungement hearing.  Bressler, Amery & Ross, the firm that represented Matthew Buchsbaum against UBS regularly represents UBS.  The award says that UBS did not participate and did not oppose the award.  Maybe a state regulator using its investigative powers could figure out whether UBS paid the bill for Bressler’s services in connection with the hearing.  Indeed, a different Bressler, Amery & Ross lawyer previously represented both a claimant and UBS at the same time in a FINRA expungement proceeding.  I assume UBS paid the bill for that one.  

Were these expungements righteous?  There is no way to know and no reason to have confidence that these kinds of arbitration awards are reliable ways to figure out the truth.  If all you know about a broker is that they have had an expungement, you know that they are 3.3 times as likely to attract future customer complaints as a random broker.  It would be much better if these expungement questions were handled outside of arbitration and in a way that allowed FINRA and the SEC to review what happens.

Yesterday, the Department of Justice unsealed indictments of several cryptocurrency exchange operators for various forms of market manipulation, in coordination with SEC complaints targeting the same conduct.  It turns out there was an elaborate FBI sting operation involved, whereby the FBI actually created a token for the targeted individuals to manipulate.  The FBI set up a website and everything – the website is actually hilarious, because it describes the token with every bit of crypto-futurish-gibberish you can imagine.  To wit:

It almost reads like it was written by AI as a parody, but I hope a real human person got to draft this.  They must be so proud.

Anyhoo, that’s not the only interesting thing.  Here’s what’s also interesting.

Often, when DOJ comes for crypto, it just charges wire fraud.  That way – unlike the SEC – it can avoid getting into a fight about whether a particular token was or was not a security.  But market manipulation, specifically, is a security-related offense.  And the DOJ wanted to get at market manipulation.  By creating its own token, DOJ could be sure that the token satisfied the definition of a “security.”  It designed it to be a security! 

For example, one argument often made in these cases is that it can’t be a security unless there’s some kind of contractual or quasi-contractual claim that investors can make on the corporate assets.  And that’s just what NexFundAI promises:

So, this Law360 article has all the indictments/complaints and you can see – the SEC goes into detail about why their creation, the NexFundAI token (of course it’s AI) was a security. 

To be sure, both agencies bring securities manipulation claims against a few of the defendants who apparently were not involved with NexFundAI – so they will have to prove the security-status of some additional tokens.  But NexFundAI is sure going to make everything easier across the board.

And another thing… New Shareholder Primacy podcast up.  This time, I talk about one-person special committees and Mike Levin talks about how activist investors do their thing.  Available at Apple, Spotify, and Youtube.

In a short Memorandum Opinion and Order signed late last month, the U.S. District Court for the Northern District of West Virginia struck down a West Virginia constitutional provision prohibiting churches from incorporating.  The case concerned Article VI, Section 47 of the West Virginia Constitution, which provides that “[n]o charter of incorporation shall be granted to any church or religious denomination.” The Court determined the West Virginia constitutional prohibition “is not neutral or generally applicable, and it does not further a compelling government interest” and therefore offends the U.S. Constitution.  Specifically, the court found that:

  • the West Virginia state constitution’s proscription of church incorporation is not neutral because “it denies incorporation to a defined class of individuals solely based upon their religion” and
  • “the State has not advanced any governmental interest, much less a compelling one, and the Court finds no compelling interest exists in prohibiting ‘any church or religious denomination’ from seeking incorporation. 

The court concludes that the provision “violates the Church’s First Amendment rights to the free exercise of religion, which is applicable to the States through the Fourteenth Amendment.”

The case is Hope Community Church v. Warner.  You can find a copy of the court’s Memorandum Opinion and Order here.  The court notes at the outset that the State of West Virginia did not oppose the plaintiff church’s Motion for Judgment on the Pleadings and shares in the recitation of facts the state’s checkered history of enforcement of the offending constitutional provision following an earlier decision striking down as unconstitutional a “nearly identical” provision in the Commonwealth of Virginia’s constitution.  See Falwell v. Miller, 203 F. Supp. 2d 624, 633 (W.D. Va. 2002).  According to the court, West Virginia is the last state to include in its constitution a prohibition on church incorporation.

Hat tip to friend-of-the-BLPB Tom Rutledge for flagging this development.